Exhibit 10.0
===========================================================================
LETTER OF CREDIT REIMBURSEMENT AGREEMENT
Dated as of September 28, 2000
between
THE PREMCOR REFINING GROUP INC.,
as Applicant
and
BANKERS TRUST COMPANY,
as Issuing Bank
===========================================================================
i
NY/302199.3
TABLE OF CONTENTS
Page
Article I. DEFINITIONS....................................................1
1.01 Certain Defined Terms............................................1
Article II. LETTERS OF CREDIT...............................................6
2.01 Issuance of Letters of Credit....................................6
2.02 Terms of Letters of Credit.......................................7
2.03 Notice of Issuance...............................................7
2.04 Payment of Amounts Drawn Under Letters of Credit.................8
2.05 Nature of BT's Duties............................................8
2.06 Obligations Absolute.............................................8
2.07 Uniform Customs and Practice and Uniform Commercial Code.........9
2.08 Voluntary Reduction of Commitment................................9
Article III. INTEREST, FEES AND EXPENSES, ETC...............................10
3.01 Reimbursement of Expenses.......................................10
3.02 Letter of Credit Fees and Commitment Fees.......................10
3.03 Indemnification in Certain Events...............................11
3.04 Net Payments....................................................12
3.06 Calculations....................................................13
Article IV. CONDITIONS PRECEDENT............................................13
4.01 Conditions of Effectiveness.....................................13
4.02 Conditions to All Letters of Credit.............................16
Article V. REPRESENTATIONS AND WARRANTIES..................................17
Article VI. COVENANTS.......................................................17
Article VII. EVENTS OF DEFAULT..............................................18
7.01 Event of Default................................................18
7.02 Remedies........................................................19
7.03 Rights Not Exclusive............................................19
Article VIII. MISCELLANEOUS.................................................19
8.01 Amendments and Waivers..........................................19
8.02 Notices.........................................................20
8.03 No Waiver: Cumulative Remedies..................................20
8.04 Indemnity.......................................................20
8.05 Marshaling; Payments Set Aside..................................21
8.06 Assignments.....................................................21
8.07 Confidentiality.................................................21
8.08 Set-off.........................................................22
8.09 Counterparts....................................................22
8.10 Severability....................................................22
8.11 No Third Parties Benefitted.....................................22
8.12 Governing Law and Jurisdiction..................................22
8.13 Waiver of Jury Trial............................................23
8.14 Entire Agreement................................................23
EXHIBITS
Exhibit A...Form of L/C Application
Exhibit B Form of Security Agreement
Exhibit C Form of Legal Opinion of Company's Counsel
<PAGE>
NY/302199.3 23
NY/302199.3
LETTER OF CREDIT REIMBURSEMENT AGREEMENT
This LETTER OF CREDIT REIMBURSEMENT AGREEMENT (the "Agreement")
is entered into as of September 28, 2000 by and between The Premcor Refining
Group Inc., a Delaware corporation (the "Company") and Bankers Trust Company,
a New York banking corporation ("BT"), as an Issuing Bank .
WHEREAS, the Company has requested that BT issue standby letters
of credit upon the terms and conditions set forth herein.
NOW, THEREFORE, in consideration of the mutual agreements,
provisions and covenants contained herein, the parties agree as follows:
Article I.
DEFINITIONS
1.01 Certain Defined Terms. The following terms have the following meanings:
"Affiliate" means, as to any Person, any other Person which,
directly or indirectly, is in control of, is controlled by, or is under
common control with, such Person. A Person shall be deemed to control another
Person if the controlling Person possesses, directly or indirectly, the power
to direct or cause the direction of the management and policies of the other
Person, whether through the ownership of voting securities, by contract, or
otherwise.
"BT-Related Persons" means BT, together with its Affiliates and
the officers, directors, employees, agents and attorneys-in-fact of BT and
its Affiliates.
"Agreement" means this Letter of Credit Reimbursement Agreement,
as amended, amended and restated, supplemented or otherwise modified from
time to time.
"Bank Credit Agreement" means that certain Amended and Restated
Credit Agreement, dated as of November 19, 1999, by and among the Company, BT
as Administrative Agent and Collateral Agent, Bank Boston, N.A. as
Documentation Agent, The Toronto Dominion Bank, as Syndication Agent and the
financial institutions party thereto, as such agreement may be amended,
amended and restated, supplemented or otherwise modified from time to time in
accordance with its terms; provided that if the Bank Credit Agreement is
terminated, "Bank Credit Agreement" shall mean the Bank Credit Agreement in
effect immediately prior to such termination.
"Bankruptcy Code" means the Federal Bankruptcy Reform Act of 1978
(11 U.S.C. 101, et seq.).
"BT" has the meaning specified in the introductory clause to this
Agreement.
"Business Day" means any 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.
"Cash" means Dollars or a credit deposit in a deposit account
denominated in Dollars that is available for withdrawal.
"Code" means the Internal Revenue Code of 1986, and regulations
promulgated thereunder.
"Collateral" means all property and interests in property and
proceeds thereof now owned or hereafter acquired by the Company in or upon
which a Lien now or hereafter exists in favor of BT, whether under this
Agreement, under any Collateral Document, or under any other documents
executed by the Company and delivered to BT in connection with this Agreement.
"Collateral Account" means that certain collateral account
maintained by BT, as Collateral Agent, the terms and conditions of which are
set forth in the Security Agreement.
"Collateral Documents" means, collectively, (i) the Security
Agreement and all other security agreements, guarantees and other similar
agreements between the Company and BT pursuant to or in connection with the
transactions contemplated hereby, and all financing statements (or comparable
documents now or hereafter filed in accordance with the UCC or comparable
law) against the Company as debtor in favor of BT, as Collateral Agent, in
connection with this Agreement, and (ii) any amendments, supplements,
modifications, renewals, replacements, consolidations, substitutions and
extensions of any of the foregoing.
"Commitment" means the amount of seventy-five million dollars
($75,000,000).
"Company" has the meaning specified in the introductory clause to
this Agreement.
"Default" means any event or circumstance which, with the giving
of notice, the lapse of time, or both, would (if not cured or otherwise
remedied during such time) constitute an "Event of Default."
"Dollars", "dollars" and "$" each mean lawful money of the United
States.
"Effective Amount" means with respect to any outstanding L/C
Obligations on any date, the amount of such Obligations on such date after
giving effect to any Issuances of Letters of Credit occurring on such date
and any other changes in the aggregate amount of the L/C Obligations as of
such date, including as a result of any reimbursements of outstanding unpaid
drawings under any Letters of Credit or any reductions in the maximum amount
available for drawing under Letters of Credit taking effect on such date.
"Effective Date" means September 28, 2000.
"Event of Default" means any of the events or circumstances
specified in Section~7.01.
Expenses means all reasonable present and future expenses
incurred by or on behalf of BT in connection with this Agreement, any other
Facility Document or otherwise related thereto, whether incurred heretofore
or hereafter, which expenses shall include, without being limited to, the
cost of record searches, the reasonable fees and expenses of attorneys and
paralegals, all costs and expenses incurred by BT in opening bank accounts,
receiving and transferring funds, and any charges imposed with respect to or
in connection with the early redemption of certificates of deposits or other
investments, fees and taxes relative to the filing or recording of financing
statements and other Collateral Documents, costs of recording Collateral
Documents, all expenses, costs and fees set forth in Article III of this
Agreement, reasonable fees and expenses incurred in connection with the
negotiation, preparation, review, execution and delivery of the Facility
Documents, irrespective of whether the transactions contemplated hereby are
consummated, including any amendments, supplements, waivers or consents
executed and delivered in connection therewith, and with the administration,
collection, enforcement and termination (including termination of any Liens)
of the Facility Documents. In addition, Expenses shall include all costs and
expenses (including the reasonable fees and disbursements of counsel and
other professionals, including internal counsel) paid or incurred by BT in
(i) enforcing or defending its rights under or in respect of any Facility
Document or any other document or instrument now or hereafter executed and
delivered in connection herewith, (ii) reimbursement obligations under the
Letters of Credit, (iii) foreclosing or otherwise collecting upon the
Collateral or any part thereof, and (iv) obtaining any legal, accounting or
other advice in connection with any of the foregoing, including in a "work
out", restructuring or similar scenario.
"Facility Documents" means this Agreement, the Collateral
Documents, the L/C-Related Documents (and the agreements executed and
delivered in connection therewith) and all other documents delivered to BT in
connection herewith or therewith.
"Facility Expiry Date" means the earliest of (a) the occurrence
of an Event of Default pursuant to Section 7.01 and demand by BT for payment
under Section 7.02(a), (b) June 30, 2001 and (c) any other termination of
this Agreement.
"Fees" means, collectively, fees referred to in Section 3.02.
"FRB" means the Board of Governors of the Federal Reserve System,
and any successor Governmental Authority.
"Governmental Authority" means any nation or government, any
state or other political subdivision thereof, any interstate or multistate
authority, any central bank (or similar monetary or regulatory authority)
thereof, any entity exercising executive, legislative, judicial, regulatory
or administrative functions of or pertaining to government, and any
corporation or other entity owned or controlled, through stock or capital
ownership or otherwise, by any of the foregoing.
"Holdings" means Premcor USA Inc., a Delaware corporation.
"Indemnified Liabilities" has the meaning specified in Section
8.04.
"Indemnified Person" has the meaning specified in Section 8.04.
"Insolvency Proceeding" means (a) any case, action or proceeding
before any Governmental Authority relating to bankruptcy, reorganization,
insolvency, liquidation, receivership, dissolution, winding-up or relief of
debtors, or (b) any general assignment for the benefit of creditors,
composition, marshaling of assets for creditors, or other, similar
arrangement in respect of its creditors generally or any substantial portion
of its creditors; undertaken under U.S. Federal, state or foreign law,
including the Bankruptcy Code.
"Issue" means, with respect to any Letter of Credit, to issue or
to extend the expiry of, or to renew or increase the amount of, such Letter
of Credit; and the terms "Issued," "Issuing" and "Issuance" have
corresponding meanings.
"Issuing Bank" means BT, its successors and affiliates, and any
other banks or financial institutions to which BT may assign its obligations
hereunder pursuant to Section 8.06.
"L/C Application" means the L/C Application substantially in the
form of Exhibit A.
"L/C Obligations" means, at any time, without duplication, the
sum of (i) the aggregate undrawn stated amount of all Letters of Credit
outstanding at such time, plus (ii) with respect to determinations of whether
a Letter of Credit shall be issued, the aggregate undrawn stated amount of
all Letters of Credit requested by the Company the issuance of which has been
authorized by BT but which have not yet been issued, plus (iii) the aggregate
amount of all drawings under Letters of Credit for which BT has not at such
time been reimbursed.
"L/C-Related Documents" means the Letters of Credit, the L/C
Application and any other document relating to the Letters of Credit,
including any of BT's standard form documents for Letter of Credit Issuances.
"Lending Office" means, the office or offices of BT specified as
its "Lending Office" on the signature page of BT attached to this Agreement,
or such other office or offices as BT may from time to time notify the
Company.
"Letters of Credit" means the standby letters of credit Issued by
BT pursuant to Article II hereof and in a form satisfactory to BT.
"Lien" means any security interest, mortgage, deed of trust,
pledge, hypothecation, assignment, charge or deposit arrangement, encumbrance
or lien (statutory or other) of any kind or nature whatsoever in respect of
any property (including those created by, arising under or evidenced by any
conditional sale or other title retention agreement, the interest of a lessor
under a capital lease, any financing lease having substantially the same
economic effect as any of the foregoing, or the filing of any financing
statement naming the owner of the asset to which such lien relates as debtor,
under the UCC or any comparable law) and any contingent or other agreement to
provide any of the foregoing, but not including the interest of a lessor
under an operating lease.
"Margin Stock" means "margin stock" as such term is defined in
Regulation T, U or X of the FRB.
"Material Contracts" means each contract, agreement and
commitment (other than the other Facility Documents) to which the Company or
any of the Restricted Subsidiaries will be a party after giving effect to the
transactions contemplated by the Facility Documents, and that will be or are
material to the business, assets or operations of the Company and the
Restricted Subsidiaries, taken as a whole.
"Obligations" means all advances, debts, liabilities,
obligations, Fees and Expenses, covenants and duties arising under any
Facility Document owing by the Company to BT, any Indemnified Person, or any
other BT-Related Persons whether direct or indirect (including those acquired
by assignment), absolute or contingent, due or to become due, now existing or
hereafter arising.
"Organization Documents" means, for any corporation, the
certificate or articles of incorporation, the bylaws, any certificate of
designations or instrument relating to the rights of preferred shareholders
of such corporation, any shareholder rights agreement, and all applicable
resolutions of the board of directors (or any committee thereof) of such
corporation.
"Other Taxes" means any present or future stamp or documentary
taxes or any other excise or property taxes, charges or similar levies which
arise from any payment made hereunder or from the execution, delivery or
registration of, or otherwise with respect to any Facility Document.
"Permitted Liens" means the liens described in Section~8.01(c),
(g) and (l) under the Bank Credit Agreement.
"Person" means an individual, partnership, corporation, business
trust, joint stock company, trust, unincorporated association, joint venture
or Governmental Authority.
"Prime Rate" means, for any day, the higher of: (a) 0.50% per
annum above the latest Federal Funds Rate; and (b) the rate of interest in
effect for such day as publicly announced from time to time by BT, as its
"prime lending rate." (The "prime lending rate" is a reference rate and does
not necessarily represent the lowest or best rate actually charged to any
customer of BT and BT may make loans at rates of interest at, above or below
the "prime lending rate).
"Requirement of Law" means, as to any Person, any law (statutory
or common), treaty, rule or regulation or determination of an arbitrator or
of a Governmental Authority, in each case applicable to or binding upon the
Person or any of its property or to which the Person or any of its property
is subject.
"Responsible Officer" means the chief executive officer, the
president, any executive vice president, the treasurer, the controller or the
secretary of the Company, or any other officer having substantially the same
authority and responsibility designated by the Company.
"Restricted Subsidiaries" has the meaning assigned to such term
in the Bank Credit Agreement.
"Security Agreement" means the Security and Collateral Account
Agreement executed by the Company and BT, as Collateral Agent, substantially
in the form of Exhibit B.
"Solvent" means, as to any Person at any time, that (a) the fair
value of the property of such Person is greater than the amount of such
Person's liabilities (including disputed, contingent and unliquidated
liabilities) as such value is established and liabilities evaluated for
purposes of Section 101(31) of the Bankruptcy Code and, in the alternative,
for purposes of the applicable Uniform Fraudulent Transfer Act; (b) the
present fair saleable value of the property of such Person is not less than
the amount that will be required to pay the probable liability of such Person
on its debts as they become absolute and matured; (c) such Person is able to
realize upon its property and pay its debts and other liabilities (including
disputed, contingent and unliquidated liabilities) as they mature in the
normal course of business; (d) such Person does not intend to, and does not
believe that it will, incur debts or liabilities beyond such Person's ability
to pay as such debts and liabilities mature; and (e) such Person is not
engaged in business or a transaction, and is not about to engage in business
or a transaction, for which such Person's property would constitute
unreasonably small capital.
"Subsidiaries" has the meaning assigned to such term in the Bank
Credit Agreement.
"Taxes" means any federal, state, local or foreign income, gross
receipts, license, payroll, employment, excise, severance, stamp, occupation,
premium, windfall profits, environmental (including tax under Section 59A of
the Code), customs duties, capital stock, franchise, profits, withholding,
social security (or similar), unemployment, disability, real property,
personal property, sales, use, transfer registration, value added,
alternative or add-on minimum, estimated, or other tax of any kind
whatsoever, including any interest, penalty, or addition thereto, whether
disputed or not, excluding such taxes (including income taxes or franchise
taxes) as are imposed on or measured by BT's net income by the jurisdiction
(or any political subdivision thereof) under the laws of which BT is
organized, maintains the lending office through which it has entered into
this agreement or its principal office.
"UCC" means the Uniform Commercial Code as in effect in the State
of New York.
"United States" and "U.S." each means the United States of
America.
"Unrestricted Subsidiaries" has the meaning assigned to such term
in the Bank Credit Agreement.
Article II.
LETTERS OF CREDIT
2.01 Issuance of Letters of Credit. Subject to the terms and conditions of
this Agreement and in reliance upon the representations and warranties of the
Company set forth herein, BT shall issue Letters of Credit at the request of
the Company and for the Company's account. BT shall not issue any Letters of
Credit for the account of the Company if at the time of such requested
Issuance:
(a) the Effective Amount of the L/C Obligations exceeds the lesser of (a)
the amount held in or for the benefit of the Collateral Account less $500,000
and (b) the Commitment; or
(b) any order, judgment or decree of any Governmental Authority or
arbitrator shall purport by its terms to enjoin or restrain BT from issuing
such Letter of Credit or any Requirement of Law applicable to BT or any
request or directive (whether or not having the force of law) from any
Governmental Authority with jurisdiction over BT shall prohibit, or request
that BT refrain from, the issuance of letters of credit generally or such
Letter of Credit in particular or shall impose upon BT with respect to such
Letter of Credit any restriction or reserve or capital requirement (for which
BT is not otherwise compensated) not in effect as of the Effective Date, or
any unreimbursed loss, cost or expense which was not applicable, in effect or
known to BT as of the Effective Date and which BT deems in good faith to be
material to it.
2.02 Terms of Letters of Credit. The Letters of Credit shall be in such
form as has been approved by BT. All Letters of Credit issued hereunder
shall expire no later than the date that is three (3) calendar days prior to
the Facility Expiry Date. Any Letter of Credit containing an automatic
renewal provision shall also contain a provision pursuant to which,
notwithstanding any other provisions thereof, it shall expire no later than
the date that is three (3) calendar days prior to the Facility Expiry Date
and a provision pursuant to which BT may, by notice to the beneficiary of
such Letter of Credit at least forty-five days (45) prior to the expiration
of its term, elect not to renew such Letter of Credit for an additional term.
2.03 Notice of Issuance. Whenever the Company desires the Issuance of a
Letter of Credit, the Company shall deliver to BT an application and request
for such Issuance substantially in the form of Exhibit A hereto (an "L/C
Application") no later than 2:00 P.M., New York City time, at least one (1)
Business Day (or such shorter period as may be agreed to by BT) in advance of
the proposed date of Issuance. The transmittal by the Company of each L/C
Application shall be deemed to be a representation and warranty by the
Company that (i) such Letter of Credit may be Issued in accordance with and
will not violate any of the requirements of Sections 2.01 or 2.02, (ii) all
conditions to the proposed Issuance set forth herein and in each other
Facility Document have been fulfilled and (iii) the Company has performed in
all material respects all agreements in the Facility Documents and there does
not exist any Default or Event of Default and no Default or Event of Default
would result from such proposed Issuance. Prior to the Issuance of each
Letter of Credit, the Company shall provide to BT a precise description of
the documents and the text of any certificate to be presented by the
beneficiary of such Letter of Credit which, if presented by such beneficiary
on or prior to the expiration date of such Letter of Credit, would require BT
to make payment under such Letter of Credit. BT, in its reasonable judgment,
may require changes in any such documents and certificates. An L/C
Application may be given in writing or electronically and, if requested by
BT, with prompt confirmation in writing. Any electronic L/C Application
shall be deemed to have been prepared by, or under the supervision of a
Responsible Officer of the Company.
2.04 Payment of Amounts Drawn Under Letters of Credit. In the event of a
drawing under any Letter of Credit by the beneficiary thereof, BT shall
notify the Company of such drawing on the day BT receives such request for
drawing. Unless the Company shall, at the time of such drawing, have posted
funds with BT sufficient to reimburse such drawing in full in Cash, BT shall
be permitted, in its sole discretion, to withdraw from the Collateral Account
funds sufficient to reimburse such drawing. Notwithstanding anything herein
to the contrary, BT will not withdraw funds from the Collateral Account
unless it has given the Company at least one Business Day's prior notice of
its intention to make such withdrawal. Unless BT notifies the Company
otherwise, delivery of notice under Section 2.04 shall constitute notice of
BT's intention to withdraw and shall satisfy the notice requirement hereunder.
2.05 Nature of BT's Duties. In determining whether to pay under a Letter of
Credit, BT shall be responsible only to determine that the documents and
certificates required to be delivered under such Letter of Credit have been
delivered and that they comply on their face with the requirements of such
Letter of Credit. As between the Company and BT, the Company assumes all
risks of the acts and omissions of BT (except to the extent that it is
finally judicially determined by a court of competent jurisdiction that such
acts or omissions were the result of BT's gross negligence or willful
misconduct) or misuse of such Letter of Credit by the beneficiary of such
Letter of Credit. In furtherance and not in limitation of the foregoing, BT
shall not be responsible (i) for the form, validity, sufficiency, accuracy,
genuineness or legal effects of any document submitted by any party in
connection with the application for and Issuance of or any drawing honored
under any Letter of Credit even if it should in fact prove to be in any or
all respects invalid, insufficient, inaccurate, fraudulent or forged, (ii)
for the validity or sufficiency of any instrument transferring or assigning
or purporting to transfer or assign such Letter of Credit, or the rights or
benefits thereunder or proceeds thereof, in whole or in part, which may prove
to be invalid or ineffective for any reason, (iii) for failure of the
beneficiary of such Letter of Credit to strictly comply with conditions
required in order to draw upon such Letter of Credit, (iv) for errors,
omissions, interruptions or delays in transmission or delivery of any
messages, by mail, cable, telegraph, telex, facsimile or otherwise, whether
or not they be in cipher, (v) for errors in interpretation of technical
terms, (vi) for any loss or delay in the transmission or otherwise of any
document required in order to make a drawing under such Letter of Credit, or
of the proceeds thereof, (vii) for the misapplication by the beneficiary of
such Letter of Credit of the proceeds of any drawing honored under such
Letter of Credit, and (viii) for any consequences arising from causes beyond
the control of BT. BT shall not be obligated to and shall not pay against
any non-conforming documents presented to it in connection with any Letter of
Credit without the prior written consent of the Company. None of the above
shall affect, impair, or prevent the vesting of any of BT's rights or powers
hereunder. Any action taken or omitted to be taken by BT under or in
connection with any Letter of Credit, if taken or omitted in the absence of
gross negligence or willful misconduct, as judicially determined by a court
of competent jurisdiction, shall not create for BT any liability to the
Company.
2.06 Obligations Absolute. The obligations of the Company to reimburse BT
for drawings honored under any Letter of Credit shall be absolute,
unconditional and irrevocable and shall be paid strictly in accordance with
the terms of this Agreement under all circumstances including, without
limitation, the following circumstances:
(a) any lack of validity or enforceability of any Letter of Credit;
(b) the existence of any claim, setoff, defense or other right which the
Company or any Affiliate of the Company may have at any time against a
beneficiary or any transferee of a Letter of Credit (or any Persons or
entities for whom any such beneficiary or transferee may be acting), BT or
any other Person, whether in connection with this Agreement, the transactions
contemplated herein or any unrelated transaction;
(c) any draft, demand, certificate or any other documents presented under
any Letter of Credit proving to be forged, fraudulent, invalid or
insufficient in any respect or any statement therein being untrue or
inaccurate in any respect;
(d) the surrender or impairment of any security for the performance or
observance of any of the terms of any of the Facility Documents;
(e) payment by BT under any Letter of Credit against presentation of a
demand, draft or certificate or other document which does not comply with the
terms of such Letter of Credit;
(f) failure of any drawing under any Letter of Credit or any nonapplication
or misapplication by the beneficiary of the proceeds of any drawing; or
(g) the fact that a Default or an Event of Default shall have occurred and
be continuing;
provided, however, that the Company shall have no obligation to reimburse BT
in the event of BT's willful misconduct or gross negligence, as judicially
determined by a court of competent jurisdiction, in determining whether
documents presented under any Letter of Credit comply with the terms of such
Letter of Credit.
2.07 Uniform Customs and Practice and Uniform Commercial Code. The Uniform
Customs and Practice for Documentary Credits as published by the
International Chamber of Commerce ("UCP") most recently at the time of
Issuance of each Letter of Credit shall (unless otherwise expressly provided
in such Letter of Credit) apply to such Letter of Credit. Without limiting
the foregoing, to the extent not addressed in the UCP, the UCC shall (unless
otherwise expressly provided in a Letter of Credit) apply to such Letters of
Credit.
2.08 Voluntary Reduction of Commitment. The Company may reduce or terminate
the Commitment at any time and from time to time in whole or in part (a
"Voluntary Reduction"). Each such Voluntary Reduction must be in an amount
not less than $5,000,000 (and in increments of $1,000,000 in excess
thereof). If the Company seeks to implement a Voluntary Reduction of the
Commitment to an amount less than [$25,000,000], then the Commitment shall be
deemed reduced to zero and, at the option of BT, all amounts hereunder shall
be immediately due and payable, provided that the amount of each such
Voluntary Reduction may not reduce the Commitment to an amount less than the
Effective Amount of all L/C Obligations plus $500,000. Once reduced, no
portion of the Commitment may be reinstated.
Article III.
INTEREST, FEES AND EXPENSES, ETC.
3.01 Reimbursement of Expenses.
(a) From and after the Effective Date, the Company shall reimburse BT
within five (5) Business Days after demand (subject to Section 4.01(e)) for
all reasonable Expenses of BT incurred by BT and upon receipt of invoices
therefor and, if requested by the Company, such reasonable backup materials
and information as the Company shall reasonably request.
(b) The Company shall promptly reimburse BT upon furnishing of an invoice
for all costs and fees and Expenses incurred by it in connection with the
enforcement, attempted enforcement or preservation of any rights or remedies
under any Facility Document and in connection with any workout,
restructuring, renegotiation or refinancing of the Obligations under this
Agreement and the other Facility Documents.
(c) BT is entitled to withdraw from the Collateral Account funds sufficient
to reimburse BT for the amounts owing under clauses (a) and (b) above if the
Company fails to pay such amounts when due.
(d) Any amounts owing hereunder (including, without limitation, amounts
owing under Section~2.04) and not paid when due shall incur interest at the
Prime Rate.
3.02 Letter of Credit Fees and Commitment Fees.
(a) The Company shall pay to BT a commitment fee on the average daily
unused portion of the Commitment, for the period commencing on the Effective
Date and continuing thereafter, and computed on a monthly basis in arrears as
of the last Business Day of each calendar month based upon the daily
utilization for that month as calculated by BT, in an amount equal to the
average daily unused portion of the Commitment times 0.15% per annum
calculated for the relevant period for which payment is required to be made.
Except as set forth above, such commitment fee shall accrue from the
Effective Date to the Facility Expiry Date and shall be due and payable
monthly in arrears upon calculation by BT; provided that, in connection with
any termination of the Commitment under Section 2.08, the accrued commitment
fee calculated for the period ending on such date shall also be paid on the
date of such termination. BT is entitled to withdraw funds from the
Collateral Account in the amount of such fees if the Company fails to pay
such fees when due. (b) The Company shall pay to BT, a Letter of Credit
fee in an amount equal to 0.40% per annum of the average daily maximum amount
available to be drawn under all Letters of Credit while outstanding, computed
on a monthly basis in arrears as of the last Business Day of each calendar
month based upon the Letters of Credit outstanding for that month as
calculated by BT. Such Letter of Credit fees shall be due and payable
monthly in arrears upon calculation by BT. BT is entitled to withdraw funds
from the Collateral Account in the amount of such fees if the Company fails
to pay such fees when due.
(b) The Company shall pay to BT from time to time on demand,
upon the furnishing of an invoice therefor, the normal issuance, payment,
amendment and other processing fees and commissions, and other standard costs
and charges, of BT relating to the Letters of Credit.
(c) Notwithstanding anything herein to the contrary, BT will not withdraw
funds from the Collateral Account unless it has given the Company at least
one Business Day's prior notice of its intention to make such withdrawal.
3.03 Indemnification in Certain Events.
(a) If after the date hereof, either (i) any change in or in the
interpretation of any law or regulation is introduced, including, without
limitation, with respect to reserve requirements, applicable to BT or any
Affiliate controlling BT or (ii) BT or such Affiliate complies with any
future guideline or request from any central bank or other Governmental
Authority and in the case of any event described in clause (i) or (ii) such
event increases the cost to BT of issuing, making or maintaining the Letters
of Credit or complying with its obligations under this Agreement or reduces
the amount receivable in respect thereof by BT or such Affiliate or (iii) BT
or such Affiliate determines that the adoption of any applicable law, rule or
regulation regarding capital adequacy, or any change therein, or any change
in the interpretation or administration thereof by any Governmental
Authority, central bank or comparable agency charged with the interpretation
or administration thereof has or would have the effect described below or, BT
or such Affiliate complies with any request or directive regarding capital
adequacy (whether or not having the force of law) of any such authority,
central bank or comparable agency, and in the case of any event set forth in
this clause (iii), such adoption, change or compliance has or would have the
direct or indirect effect of reducing the rate of return on any of the
capital as a consequence of its obligations hereunder to a level below that
which BT or such Affiliate could have achieved but for such adoption, change
or compliance (taking into consideration BT's or such Affiliate's policies as
the case may be with respect to capital adequacy) by an amount deemed by BT
or such Affiliate to be material, then in any such case, the Company shall,
upon demand by BT or such Affiliate pay to BT or such Affiliate additional
amounts sufficient to indemnify BT or such Affiliate against such increase in
cost or reduction in amount receivable. A certificate as to the amount of
such increased cost or reduction in amounts and setting forth in reasonable
detail the calculation thereof shall be submitted to the Company by BT or the
applicable Affiliate and shall be conclusive, absent manifest error. In the
event BT is entitled to payment hereunder in respect of such increased cost
or reduction in amounts, BT shall use reasonable efforts to designate a
different Lending Office to the extent such designation could reduce or
eliminate such payment and such designation is not, in BT's reasonable
judgment, otherwise disadvantageous to BT.
(b) It is understood that (i) Section 3.03(a) does not relate to any
changes in the rate of tax on the net income of BT or any Affiliate
controlling BT imposed by the jurisdiction in which it is organized,
maintains a lending office or its principal office, or has any other contacts
or connections that would subject it to taxation therein (excluding any
connection or contact arising solely from BT or such Affiliate having
executed, delivered, performed its obligations or received a payment under,
or enforced this Agreement or any other Facility Document) and (ii) any
payment made under this Section 3.03 shall be made without duplication for
any item that is covered by Section 3.04.
3.04 Net Payments.
(a) All payments by the Company hereunder or under any other Facility
Document to or for the benefit of BT shall be made without set-off,
counterclaim or other defense and shall be made free and clear of, and
without deduction or withholding for, any Taxes. In addition, the Company
shall pay all Other Taxes.
(b) The Company agrees to indemnify and hold harmless BT for the full
amount of Taxes or Other Taxes (including any additional Taxes or Other Taxes
imposed by any jurisdiction on amounts payable under this Section 3.04(b))
paid by BT, in respect of any sum payable hereunder or under any other
Facility Document (including penalties, interest, additions to tax and any
reasonable expenses). Payment under this indemnification shall be made
within 30 days after the date BT makes written demand therefor.
(c) If the Company shall be required by law to deduct or withhold any Taxes
or Other Taxes from or in respect of any sum payable hereunder (or under any
other Facility Document) to BT, then:
(i) the sum payable shall be increased as necessary so that after making
all such required deductions and withholdings of Taxes or Other Taxes
(including deductions and withholdings applicable to additional sums
payable under this Section 3.04), BT receives an amount equal to the
sum it would have received had no such deductions or withholdings been
made;
(ii) the Company shall make such deductions and withholdings; and
(iii) the Company shall pay the full amount deducted or withheld to the
relevant taxing authority or other authority in accordance with
applicable law.
(d) Within 30 days after the date of any payment by the Company of Taxes or
Other Taxes, the Company shall furnish to BT the original or a certified copy
of a receipt evidencing payment thereof, or other evidence of payment
satisfactory to BT if available from the appropriate taxing authority.
(e) If the Company would be required to pay additional amounts to BT
pursuant to paragraph (b) or (c) of this Section 3.04, then BT shall use
reasonable efforts (consistent with legal and regulatory restrictions) to
change the jurisdiction of its lending office so as to eliminate the
obligation of the Company to pay any such additional amounts which may
thereafter accrue or to indemnify BT in the future, if such change in the
reasonable judgment of BT is not otherwise disadvantageous to BT.
(f) The Company shall not be required to pay any additional amounts
pursuant to this Section 3.04 to the extent that such additional amounts
relate to Taxes or Other Taxes (including obligations to deduct or withhold
amounts with respect thereto) for any period that are attributable to U.S.
withholding taxes imposed (i) on the date hereof or (ii) other than as a
result of a change in law, regulation or treaty. If BT becomes subject to
Taxes because of its failure to deliver a form required hereunder, the
Company shall take such steps as BT shall reasonably request to assist BT to
recover such Taxes.
3.05 Bank Participations. BT may sell participations (without the consent
of the Company) to one or more parties in or to all or a portion of its
rights and obligations under this Agreement. Notwithstanding BT's sale of a
participation interest, its obligations hereunder shall remain unchanged.
The Company shall continue to deal solely and directly with BT.
3.06 Calculations. All calculations of per annum fees shall be made by BT,
on the basis of a year of 360 days, or, if such computation would cause the
interest and fees chargeable hereunder to exceed the highest rate allowed by
applicable law, 365/366 days, for the actual number of days elapsed
(including the first day but excluding the last day) occurring in the period
for which such fees are payable. Each determination by BT of a payment
hereunder shall be conclusive and binding for all purposes, absent manifest
error.
Article IV.
CONDITIONS PRECEDENT
4.01 Conditions of Effectiveness. The obligations of BT hereunder and the
effectiveness of this Agreement are subject to the fulfillment of the
following conditions precedent and the prior receipt by BT of all of the
following dated the date hereof or such other date as is satisfactory to BT,
in form and substance satisfactory to BT:
(a) Agreement and L/C Application. This Agreement and the L/C Application
for any Letter of Credit to be issued on the date of effectiveness shall be
executed by each party hereto and thereto;
(b) Resolutions; Incumbency.
(i) Copies of the resolutions of the board of directors of the Company
authorizing the execution, delivery and performance of the Facility
Documents and any other documents, instruments and certificates
required to be executed by the Company in connection herewith or
therewith and the transactions contemplated hereby and thereby,
certified as of the date hereof by the Secretary or an Assistant
Secretary of the Company; and
(ii) A certificate of the Secretary or Assistant Secretary of the Company,
certifying the names and true signatures of the officers of the Company
authorized to execute, deliver and perform the Facility Documents to be
delivered by it hereunder;
(c) Organization Documents; Good Standing. Each of the following documents:
(i) the certificate of incorporation of the Company, certified by the
Secretary of State of the State of Delaware dated as of a recent date
prior to the date hereof, dated the date hereof, and the bylaws of the
Company as in effect on the date hereof, certified by the Secretary or
an Assistant Secretary of the Company as of a recent date; and
(ii) a good standing and tax good standing certificate for the Company from
the Secretary of State of the state of Delaware dated as of a recent
date;
(d) Legal Opinions. an opinion of Simpson Thacher & Bartlett, counsel to
the Company, addressed to BT, substantially in the form of Exhibit C hereto;
(e) Payment of Fees and Expenses. Evidence of payment by the Company of
all accrued and unpaid Fees and Expenses to the extent then due and payable
on the date hereof, together with any reasonable estimate of fees and
expenses of outside counsel incurred or to be incurred by it through the
closing proceedings (provided that such estimate shall not thereafter
preclude final settling of accounts between the Company and such Person);
including, without limitation, any such costs, fees, commissions and expenses
arising under or referenced in Section~3.01 or in Section 3.02;
(f) Collateral Documents.
(i) the Collateral Documents executed by the Company and each of the
parties thereto in appropriate form for filing or recording where
necessary, together with:
(ii) executed copies of all UCC-1 financing statements in proper form for
filing to perfect the security interests of BT or other evidence
satisfactory to BT that there has been delivered to BT for filing,
registration or recordation all financing statements and other filings,
registrations and recordings necessary and advisable to perfect the
Liens of BT in accordance with applicable law;
(iii) all certificates, instruments or documents representing or evidencing
any Collateral in suitable form for transfer by delivery or accompanied
by duly executed instruments of transfer or assignment in blank, all in
form and substance satisfactory to BT;
(iv) written advice relating to such Lien searches as BT shall have
requested, and such termination statements or other documents as may be
necessary to confirm that the Collateral is subject to no other Liens
in favor of any Persons;
(v) funds sufficient to pay any filing or recording tax or fee in
connection with any and all UCC financing statements;
(vi) evidence that the Security Agreement is in full force and effect and
that the cash collateral account has been credited with funds equal to
the aggregate face amount of all Letters of Credit requested by the
Company as of the Closing Date plus $500,000 and is otherwise in form
and substance satisfactory to BT; and
(vii) evidence that all other actions necessary or desirable to perfect the
first priority Lien created by the Collateral Documents, and to enhance
BT's ability to preserve its interests in and access to the Collateral,
have been taken;
(g) Certificate. A certificate signed by a Responsible Officer, dated as
of the date hereof, stating that:
(i) the representations and warranties contained in Article V are true and
correct on and as of such date, as though made on and as of such date;
(ii) no Default or Event of Default exists on the Effective Date, or would
result from the execution and performance of the Facility Documents;
(iii) there is no litigation, proceeding, inquiry or other action seeking an
injunction or other restraining order, damages or other relief, pending
or threatened, with respect to any Facility Document; and
(iv) there exists no judgment, order, injunction, decree or other restraint
or a hearing seeking injunctive relief or other restraint pending or
noticed with respect to any transaction contemplated by any Facility
Documents;
(h) Corporate Proceedings. Evidence satisfactory to BT that all corporate
and other proceedings taken or to be taken in connection with the
transactions contemplated by the Facility Documents and all documents
incidental to this Agreement and thereto shall be in form and substance
satisfactory to BT and that BT shall have received all counterpart originals
or certified copies of such documents;
(i) Consents, Approvals, Etc. All necessary orders, permits, licenses,
authorizations, approvals, consents and waivers by any Governmental Authority
or other Person (including, without limitation, the consent of certain
customers, if required, under any Material Contracts) in connection with the
transactions contemplated hereby and by any of the other Facility Documents.
Each of the aforementioned orders, permits, licenses, authorizations,
approvals, consents and waivers by Governmental Authorities or other Persons
shall be in full force and effect and shall be in form and substance
satisfactory to BT;
(j) Material Contracts and Other Documents. Copies of all Material
Contracts in effect as of the date hereof, which are set forth on Schedule
5.01(j) to the Bank Credit Agreement and include the Supply and Terminalling
Agreement among the Company, Equiva Trading Company ("ETC"), Equilon
Enterprises LLC ("Equilon") and Motiva Enterprises LLC ("Motiva"), the Asset
Purchase Agreement among the Company, Clark Port Arthur Pipeline Company and
Motiva, the Asset Purchase Agreement between the Company and Equilon and the
Interim Terminalling Agreement among the Company, ETC, Equilon and Motiva,
copies of the Holdings Note Indenture and the Holdings Notes (in each case as
defined in the Bank Credit Agreement and including all schedules and exhibits
thereto), which shall be in full force and effect, and copies of all
commodities account agreements in effect;
(k) No Litigation. There shall not be any litigation, proceeding, inquiry
or other action seeking an injunction or other restraining order, damages or
other relief, pending or threatened, with respect to any Facility Document;
and there shall not exist any judgment, order, injunction, decree or other
restraint or a hearing seeking injunctive relief or other restraint pending
or noticed with respect to any transaction contemplated by any Facility
Documents;
4.02 Conditions to All Letters of Credit. The issuance of any Letter of
Credit hereunder is subject to the following conditions precedent:
(a) Notice of Issuance of Letter of Credit. On or before the date of
Issuance of such Letter of Credit, BT shall have received from the Company,
in accordance with the provisions of Sections 2.01 and 2.02, an L/C
Application, together with all other information specified in Article III and
such other documents or information as BT may require in connection with the
Issuance of such Letter of Credit;
(b) Continuation of Representations and Warranties; No Default or Event of
Default. After giving effect to such Issuance, the representations and
warranties in Article V shall be true and correct on and as of such Issuance
date with the same effect as if made on and as of such Issuance date (except
as provided in Section 5.05(b) of the Bank Credit Agreement, with the
references to "Banks" and "Majority Banks" therein being references to BT)
and there shall not exist any Default or Event of Default;
(c) Deposit of Collateral; No Future Advance Notice. The Cash Collateral
Account shall have been credited with funds equal to the Effective Amount
plus $500,000. BT shall not have received from the Company any notice that
any Collateral Document will no longer secure on a first priority basis
future Letters of Credit to be issued under this Agreement;
(d) Performance of Agreements. The Company shall have performed in all
material respects all agreements and satisfied all conditions which the
Facility Documents provide shall be performed or satisfied by it on or before
the relevant Issuance date;
(e) No Judgments. No order, judgment or decree of any arbitrator or
Governmental Authority shall purport to enjoin or restrain BT from Issuing
any Letter of Credit to be Issued by it on the relevant Issuance Date;
(f) Regulation T, U and X. The Issuance of any Letter of Credit requested
on the relevant Issuance Date shall not violate any law including, without
limitation, Regulation T, U or X of FRB; and
(g) No Litigation. There shall not be pending or, to the knowledge of the
Company, threatened, any action, suit, proceeding, governmental investigation
or arbitration against or affecting the Company or any of its Subsidiaries or
any property of the Company or any of its Subsidiaries that has not been
disclosed by the Company in writing pursuant to Article VI prior to the
Issuance of the last preceding Letter of Credit, and there shall have
occurred no development not so disclosed in any such action, suit,
proceeding, governmental investigation or arbitration so disclosed, that, in
either event, would reasonably be expected to have a Material Adverse Effect
(as defined in the Bank Credit Agreement, with the references to the "Loan
Documents" therein being references to the "Facility Documents"); and no
injunction or other restraining order shall have been issued and no hearing
to cause an injunction or other restraining order to be issued shall be
pending or noticed with respect to any action, suit or proceeding seeking to
enjoin or otherwise prevent the consummation of, or to recover any damages or
obtain relief as a result of, the transactions contemplated by any Facility
Document or the issuance of any Letter of Credit.
Each L/C Application submitted by the Company hereunder shall constitute a
representation and warranty by the Company hereunder, as of the date of such
L/C Application and as of the date on which the applicable Letter of Credit
is Issued, that the conditions in this Section 4.02 are satisfied.
Article V.
REPRESENTATIONS AND WARRANTIES
The Company hereby makes to BT each of the representations and
warranties set forth in Article VI of the Bank Credit Agreement and each such
representation and warranty (and all definitions relevant thereto) is hereby
incorporated by reference in its entirety mutatis mutandis, including,
without limitation, changes to effect the following: (i) all references to
the "Administrative Agent" and/or the "Banks" and/or "Bank Swap Parties" (as
such terms are used in the Bank Credit Agreement) shall refer to BT, (ii) all
references to the "Agreement", the "Loan Documents" and the "Collateral
Documents" (as such terms are used in the Bank Credit Agreement) shall refer
to the Agreement, the Facility Documents and the Collateral Documents and
(iii) all references to sections and paragraphs shall refer to the
corresponding sections and/or paragraphs hereunder.
Article VI.
COVENANTS
So long as any Letter of Credit shall remain outstanding or any
other Obligation shall remain unpaid or unsatisfied the Company agrees to
perform or refrain from performing, as the case may be, the Affirmative
Covenants set forth in Article VII of the Bank Credit Agreement and the
Negative Covenants set forth in Article VIII of the Bank Credit Agreement and
each such covenant (and all definitions relevant thereto) is hereby
incorporated by reference in entirety mutatis mutandis, including, without
limitation, changes to effect the following: (i) all references to the
"Administrative Agent" and/or the "Banks" and/or "Bank Swap Parties" (as such
terms are used in the Bank Credit Agreement) shall refer to BT, (ii) all
references to the "Agreement", the "Loan Documents" and the "Collateral
Documents" (as such terms are used in the Bank Credit Agreement) shall refer
to the Agreement, the Facility Documents and the Collateral Documents and
(iii) all references to sections and paragraphs shall refer to the
corresponding sections and/or paragraphs hereunder. Notwithstanding the
foregoing, the second and third sentences of Section 7.06 of the Bank Credit
Agreement shall not be incorporated herein. So long as BT continues to be
Administrative Agent under the Bank Credit Agreement, covenants requiring
delivery of information shall be satisfied if delivery of such information is
made under the Bank Credit Agreement pursuant to the terms thereof.
Article VII.
EVENTS OF DEFAULT
7.01 Event of Default. Any of the following shall constitute an "Event of
Default":
(a) Non-Payment. The Company fails to pay when and as required to be paid
herein, any interest, fee or any other amount payable under any Facility
Document; or
(b) Representation or Warranty. Any representation or warranty by the
Company or any of its Restricted Subsidiaries made or deemed made, in any
Facility Document, or which is contained in any certificate, document or
financial or other written statement by the Company, any such Restricted
Subsidiary, or any Responsible Officer or any other officer or employee,
furnished at any time under any Facility Document, is incorrect in any
material respect on or as of the date made or deemed made; or
(c) Default under the Bank Credit Agreement. An "Event of Default" (as
such term is defined in the Bank Credit Agreement) occurs and is continuing;
or
(d) Insolvency; Voluntary Proceedings. Holdings, the Company or any of
their respective subsidiaries (other than any Restricted Subsidiary with
total assets of less than $1,000,000 and other than any Unrestricted
Subsidiary) (i) ceases or fails to be Solvent, or generally fails to pay, or
admits in writing its inability to pay, its debts as they become due, subject
to applicable grace periods, if any, whether at stated maturity or otherwise;
(ii) voluntarily ceases to conduct its business in the ordinary course; (iii)
commences any Insolvency Proceeding with respect to Holdings, the Company or
any Restricted Subsidiary with total assets of at least $1,000,000; or (iv)
takes any action to effectuate or authorize any of the foregoing; or
(e) Involuntary Proceedings. (i) Any involuntary Insolvency Proceeding is
commenced or filed against Holdings, the Company or any of their respective
Subsidiaries (other than any Restricted Subsidiary with total assets of less
than $1,000,000 and other than any Unrestricted Subsidiary), or any writ,
judgment, warrant of attachment, execution or similar process, is issued or
levied against a substantial part of Holdings', the Company's or such
Restricted Subsidiary's properties, and any such proceeding or petition shall
not be dismissed, or such writ, judgment, warrant of attachment, execution or
similar process shall not be released, vacated or fully bonded within 60 days
after commencement, filing or levy; (ii) Holdings, the Company or any of
their respective Subsidiaries (other than any Restricted Subsidiaries with
total assets of less than $1,000,000 and other than any Unrestricted
Subsidiary) admits the material allegations of a petition against it in any
Insolvency Proceeding, or an order for relief (or similar order under non-US.
law) is ordered in any Insolvency Proceeding; or (iii) Holdings, the Company
or any of their respective Subsidiaries (other than any Restricted
Subsidiaries with total assets of less than $1,000,000 and other than any
Unrestricted Subsidiary) acquiesces in the appointment of a receiver,
trustee, custodian, conservator, liquidator, mortgagee in possession (or
agent therefor), or other similar Person for itself or a substantial portion
of its property or business; or
(f) Collateral.
(i) Any provision of any Collateral Document shall for any reason cease to
be valid and binding on or enforceable against the Company and the
effect thereof is to prevent BT from realizing the practical benefits
afforded by or purported to be afforded by such Collateral Document or
the Company shall so state in writing or bring an action to limit its
obligations or liabilities thereunder; or
(ii) Any Collateral Document shall for any reason (other than pursuant to
the terms thereof) cease to create a valid security interest in the
Collateral purported to be covered thereby or such security interest
shall for any reason cease to be a perfected and first priority
security interest (other than solely due to the action or inaction of
BT with respect to matters involving priority or perfection).
7.02 Remedies.
If any Event of Default occurs, BT may
(a) declare an amount equal to the maximum aggregate amount that is or at
any time thereafter may become available for drawing under any or all Letters
of Credit (whether or not any beneficiary shall have presented, or shall be
entitled at such time to present, the drafts or other documents required to
draw under such Letters of Credit) to be immediately due and payable, and
declare all other amounts owing or payable hereunder or under any other
Facility Document to be immediately due and payable, without presentment,
demand, protest or other notice of any kind, all of which are hereby
expressly waived by the Company; and
(b) exercise all rights and remedies available to it under the Facility
Documents or applicable law;
provided, however, that upon the occurrence of any event specified in Section
(d) or (e) of Section 7.01 (in the case of clause (i) of Section (e) upon the
expiration of the 60- day period mentioned therein), all amounts as aforesaid
shall automatically become due and payable without further act of BT.
7.03 Rights Not Exclusive. The rights provided for in this Agreement and
the other Facility Documents are cumulative and are not exclusive of any
other rights, powers, privileges or remedies provided by law or in equity, or
under any other instrument, document or agreement now existing or hereafter
arising.
Article VIII.
MISCELLANEOUS
8.01 Amendments and Waivers No amendment or waiver of any provision of any
Facility Document, and no consent with respect to any departure by the
Company or any of its subsidiaries therefrom, shall be effective unless the
same shall be in writing and signed by the BT.
8.02 Notices.
(a) All notices, requests and other communications shall be in writing
(including, unless the context expressly otherwise provides, by facsimile
transmission) or, in the case of any Letter of Credit, electronically,
provided that any matter transmitted by the Company by facsimile (i) shall be
immediately confirmed by a telephone call to the recipient at the number
specified on the signature page of BT attached to this Agreement, and (ii)
shall be followed promptly by delivery of a hard copy original thereof and
mailed, faxed or delivered, to the address or facsimile number specified for
notices on the signature page of BT attached to this Agreement; or, as
directed to the Company, to such other address as shall be designated by such
party in a written notice to the other parties, and as directed to any other
party, at such other address as shall be designated by such party in a
written notice to the Company.
(b) All such notices, requests and communications shall, when transmitted
by overnight delivery or electronically, or faxed, be effective when
delivered for overnight (next-day) delivery, transmitted electronically or
transmitted in legible form by facsimile machine, respectively, or if mailed,
upon the third Business Day after the date deposited into the U.S. mail, or
if delivered, upon delivery; except that notices pursuant to Article II shall
not be effective until actually received (by overnight delivery,
electronically, fax or mail) by BT at the address specified.
(c) Any agreement of BT to receive certain notices by telephone or
facsimile is solely for the convenience and at the request of the Company.
BT shall be entitled to rely on the authority of any Person purporting to be
a Person authorized by the Company to give such notice and BT shall not have
any liability to the Company or other Person on account of any action taken
or not taken by BT in reliance upon such telephonic or facsimile notice. The
obligation of the Company to repay the Obligations shall not be affected in
any way or to any extent by any failure by BT to receive written confirmation
of any telephonic or facsimile notice or the receipt by BT of a confirmation
which is at variance with the terms understood by BT to be contained in the
telephonic or facsimile notice.
8.03 No Waiver: Cumulative Remedies. No failure to exercise and no delay in
exercising, on the part of BT, any right, remedy, power or privilege
hereunder, shall operate as a waiver thereof; nor shall any single or partial
exercise of any right, remedy, power or privilege hereunder preclude any
other or further exercise thereof or the exercise of any other right, remedy,
power or privilege.
8.04 Indemnity.
(a) Whether or not the transactions contemplated hereby are consummated,
the Company shall indemnify, defend and hold BT, the BT-Related Persons, and
each of their respective officers, directors, employees, counsel, agents and
attorneys-in-fact (each, an "Indemnified Person") harmless from and against
any and all liabilities, obligations, losses, damages, penalties, actions,
judgments, suits, costs, charges, expenses and disbursements (including fees
and expenses of any law firm or external counsel) of any kind or nature
whatsoever which may at any time (including at any time following the
termination of the Letter of Credit and the termination, resignation or
replacement of BT) be imposed on, incurred by or asserted against any such
Person in any way relating to or arising out of this Agreement or any
document contemplated by or referred to herein, or the transactions
contemplated hereby, or any action taken or omitted by any such Person under
or in connection with any of the foregoing, including with respect to any
investigation, litigation or proceeding (including any Insolvency Proceeding
or appellate proceeding) related to or arising out of any Facility Document
or the Letter of Credit or the use of the proceeds thereof, whether or not
any Indemnified Person is a party thereto (all the foregoing, collectively,
the "Indemnified Liabilities"); provided that the Company shall have no
obligation hereunder to any Indemnified Person with respect to Indemnified
Liabilities resulting primarily from the gross negligence or willful
misconduct of such Indemnified Person.
(b) The obligations in this Section~8.04 shall survive payment of all other
Obligations. At the election of any Indemnified Person, the Company shall
defend such Indemnified Person using legal counsel satisfactory to such
Indemnified Person in such Person's sole discretion, at the sole cost and
expense of the Company. All amounts owing under this Section 8.04 shall be
paid within 30 days after demand.
8.05 Marshaling; Payments Set Aside. BT shall not be under any obligation
to marshal any assets in favor of the Company or any other Person or against
or in payment of any or all of the Obligations. To the extent that the
Company makes a payment to BT or BT exercises its right of set-off, and such
payment or the proceeds of such set-off or any part thereof are subsequently
invalidated, declared to be fraudulent or preferential, set aside or required
(including pursuant to any settlement entered into by BT in its discretion)
to be repaid to a trustee, receiver or any other party, in connection with
any Insolvency Proceeding or otherwise, then, to the extent of such recovery
the obligation or part thereof originally intended to be satisfied shall be
revived and continued in full force and effect as if such payment had not
been made or such set-off had not occurred.
8.06 Assignments. The Company may not assign its rights or obligations
hereunder without the prior written consent of BT. BT may assign its rights
to receive payments hereunder to a third party. BT may not assign its
obligations hereunder without the prior written consent of the Company, which
consent will not be unreasonably withheld.
8.07 Confidentiality. Except as otherwise provided in this Section 8.07, BT
agrees that it will not disclose without the prior consent of the Company,
any information with respect to the Company or any of its Subsidiaries which
is furnished pursuant to this Agreement and which is designated by the
Company to BT in writing as confidential, provided, that BT may disclose any
such information (a) to its Affiliates, employees, auditors or counsel,
provided that each such person will be advised of the confidential nature of
such information, (b) as has become generally available to the public, (c) as
may be required or appropriate in any report, statement or testimony
submitted to any Governmental Authority having or claiming to have
jurisdiction over BT, (d) as may be required or appropriate in response to
any summons or subpoena or in connection with any litigation, and (e) in
order to comply with any Requirement of Law.
8.08 Set-off. In addition to any rights and remedies of BT provided by law,
if an Event of Default exists, BT is authorized at any time and from time to
time, without prior notice to the Company, any such notice being waived by
the Company to the full extent permitted by law, to set off and apply any and
all deposits (general or special, time or demand, provisional or final) at
any time held by, and other indebtedness at any time owing by, BT to or for
the credit or the account of the Company against any and all Obligations
owing to BT, now or hereafter existing, irrespective of whether or not BT
shall have made demand under this Agreement or any Facility Document and
although such Obligations may be contingent or unmatured or fully secured.
BT agrees promptly to notify the Company after any such set-off and
application made by BT; provided, however, that the failure to give such
notice shall not affect the validity of such set-off and application.
8.09 Counterparts. This Agreement may be executed in any number of separate
counterparts, each of which, when so executed, shall be deemed an original,
and all of said counterparts taken together shall be deemed to constitute but
one and the same instrument.
8.10 Severability. The illegality or unenforceability of any provision of
this Agreement or any instrument or agreement required hereunder shall not in
any way affect or impair the legality or enforceability of the remaining
provisions of this Agreement or any instrument or agreement required
hereunder.
8.11 No Third Parties Benefitted. This Agreement is made and entered into
for the sole protection and legal benefit of the Company, BT and the
BT-Related Persons, and their permitted successors and assigns, and no other
Person shall be a direct or indirect legal beneficiary of, or have any direct
or indirect cause of action or claim in connection with, this Agreement or
any of the other Facility Documents.
8.12 Governing Law and Jurisdiction.
(a) THIS AGREEMENT SHALL BE GOVERNED BY, AND CONSTRUED IN ACCORDANCE WITH,
THE LAW OF THE STATE OF NEW YORK; PROVIDED THAT BT SHALL RETAIN ALL RIGHTS
ARISING UNDER FEDERAL LAW.
(b) ANY LEGAL ACTION OR PROCEEDING WITH RESPECT TO ANY FACILITY DOCUMENT
MAY BE BROUGHT IN THE COURTS OF THE STATE OF NEW YORK OR OF THE UNITED STATES
FOR THE SOUTHERN DISTRICT OF NEW YORK, AND BY EXECUTION AND DELIVERY OF THIS
AGREEMENT, EACH OF THE COMPANY AND BT CONSENTS, FOR ITSELF AND IN RESPECT OF
ITS PROPERTY, TO THE NON-EXCLUSIVE JURISDICTION OF THOSE COURTS. EACH OF THE
COMPANY AND BT IRREVOCABLY WAIVES ANY OBJECTION, INCLUDING ANY OBJECTION TO
THE LAYING OF VENUE OR BASED ON THE GROUNDS OF FORUM NON CONVENIENS, WHICH IT
MAY NOW OR HEREAFTER HAVE TO THE BRINGING OF ANY ACTION OR PROCEEDING IN SUCH
JURISDICTION IN RESPECT OF THIS AGREEMENT OR ANY DOCUMENT RELATED TO THIS
AGREEMENT. THE COMPANY AND BT EACH WAIVES PERSONAL SERVICE OF ANY SUMMONS,
COMPLAINT OR OTHER PROCESS, WHICH MAY BE MADE BY ANY OTHER MEANS PERMITTED BY
NEW YORK LAW.
8.13 Waiver of Jury Trial. THE COMPANY AND BT EACH WAIVES ITS RIGHT TO A
TRIAL BY JURY OF ANY CLAIM OR CAUSE OF ACTION BASED UPON OR ARISING OUT OF OR
RELATED TO THE FACILITY DOCUMENTS, OR THE TRANSACTIONS CONTEMPLATED HEREBY OR
THEREBY, IN ANY ACTION, PROCEEDING OR OTHER LITIGATION OF ANY TYPE BROUGHT BY
ANY OF THE PARTIES AGAINST ANY OTHER PARTY OR ANY BT-RELATED PERSON,
PARTICIPANT OR ASSIGNEE, WHETHER WITH RESPECT TO CONTRACT CLAIMS, TORT
CLAIMS, OR OTHERWISE. THE COMPANY AND BT EACH AGREE THAT ANY SUCH CLAIM OR
CAUSE OF ACTION SHALL BE TRIED BY A COURT TRIAL WITHOUT A JURY. WITHOUT
LIMITING THE FOREGOING, THE PARTIES FURTHER AGREE THAT THEIR RESPECTIVE RIGHT
TO A TRIAL BY JURY IS WAIVED BY OPERATION OF THIS SECTION AS TO ANY ACTION,
COUNTERCLAIM OR OTHER PROCEEDING WHICH SEEKS, IN WHOLE OR IN PART, TO
CHALLENGE THE VALIDITY OR ENFORCEABILITY OF THE FACILITY DOCUMENTS OR ANY
PROVISION THEREOF. THIS WAIVER SHALL APPLY TO ANY SUBSEQUENT AMENDMENTS,
RENEWALS, SUPPLEMENTS OR MODIFICATIONS TO THE FACILITY DOCUMENTS.
8.14 Entire Agreement. This Agreement, together with the other Facility
Documents, embodies the entire agreement and understanding between the
Company and BT and supersedes all prior or contemporaneous agreements and
understandings of such Persons, verbal or written, relating to the subject
matter of this Agreement and thereof.
================================================================================
IN WITNESS WHEREOF, the parties to this Agreement have caused
this Agreement to be duly executed and delivered by their proper and duly
authorized officers as of the day and year first above written.
THE PREMCOR REFINING GROUP INC.
/s/ Jeffrey S. Beyersdorfer
----------------------------------
NAME: JEFFREY S. BEYERSDORFER
TITLE: VICE PRESIDENT - CORPORATE FINANCE
Address for notices:
The Premcor Refining Group Inc.
8182 Maryland Avenue
St. Louis, Missouri 63105
Telephone: (314) 854-1469
Fax: (314) 854-1570
<PAGE>
ISSUING BANK
BANKERS TRUST COMPANY
as Issuing Bank
/s/ Marcus M. Tarkington
----------------------------------
NAME: MARCUS M. TARKINGTON
TITLE: DIRECTOR
Address for notices:
Marcus M. Tarkington
Bankers Trust Company
130 Liberty Street
Mailstop 2344
New York, NY 10006
Telephone: (212) 250-7684
Fax: (212) 250-8693
With a copy to:
Robert Hilliard
Marco Orlando
Bankers Trust Company
130 Liberty Street
14th Floor
New York, NY 10006
Telephone: (212) 250-4365/4361
Fax: (212) 250-5817
