<PAGE>
UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, D.C. 20549
FORM 10-Q
X QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE
SECURITIES EXCHANGE ACT OF 1934
For the quarterly period ended September 30, 1997
OR
____ TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE
SECURITIES EXCHANGE ACT OF 1934
For the transition period from ________________ to _____________
______________________________________________
Commission file number 1-10053
ORYX ENERGY COMPANY
(Exact name of registrant as specified in its charter)
DELAWARE 23-1743284
(State or other jurisdiction of (I.R.S. Employer
incorporation or organization) Identification Number)
13155 NOEL ROAD, DALLAS, TEXAS 75240-5067
(Address of principal executive offices) (Zip code)
(972) 715-4000
(Registrant's telephone number, including area code)
_________________________________
Indicate by check mark whether the registrant (1) has filed
all reports required to be filed by Section 13 or 15(d) of the
Securities Exchange Act of 1934 during the preceding 12 months
(or for such shorter period that the registrant was required to
file such reports), and (2) has been subject to such filing
requirements for the past 90 days. Yes X No
________________________________
The number of shares of common stock, $1 par value,
outstanding on November 1, 1997 was 105,720,071.
<PAGE>
<PAGE> 2
ORYX ENERGY COMPANY
________________________________
INDEX
Page
PART I. FINANCIAL INFORMATION
Item 1. Financial Statements
Condensed Consolidated Statements of Income
for the Three and Nine Months Ended
September 30, 1997 and 1996 3
Condensed Consolidated Balance Sheets at
September 30, 1997 and December 31, 1996 4
Condensed Consolidated Statements of Cash
Flows for the Nine Months Ended
September 30, 1997 and 1996 5
Notes to Condensed Consolidated Financial
Statements 6
Report of Independent Accountants 9
Item 2. Management's Discussion and Analysis of
Financial Condition and Results of Operations10
PART II. OTHER INFORMATION
Item 6. Exhibits and Reports on Form 8-K 14
SIGNATURE 15
<PAGE>
<PAGE> 3
PART I
FINANCIAL INFORMATION
Item 1. Financial Statements
ORYX ENERGY COMPANY
CONDENSED CONSOLIDATED STATEMENTS OF INCOME
<TABLE>
<CAPTION>
For the Three Months For the Nine Months
(Millions of Dollars, Ended September 30 Ended September 30
Except per Share Amounts) 1997 1996 1997 1996
(Unaudited)
<C> <C> <C> <C>
<S>
Revenues
Oil and gas (Note 3) $294 $ 293 $ 912 $ 797
Other (7) (4) (16) (8)
---- ----- ----- -----
287 289 896 789
---- ----- ----- -----
Costs and Expenses
Operating costs 60 58 196 173
Production taxes 41 41 121 103
Exploration costs 18 16 49 41
Depreciation, depletion
and amortization 78 71 231 200
General and administrative
expense 14 14 44 43
Interest and debt
expense 28 28 83 84
Interest capitalized (4) (5) (12) (12)
---- ----- ----- -----
235 223 712 632
---- ----- ----- -----
Income Before Provision for
Income Taxes 52 66 184 157
Provision for Income
Taxes (Note 4) 12 26 57 57
Remeasurement of Foreign
Deferred Tax (Note 4) (2) - (4) -
---- ----- ----- -----
Net Income $ 42 $ 40 $131 $ 100
==== ===== ===== =====
Net Income Per Share
of Common Stock $.40 $ .38 $1.24 $ .95
==== ===== ===== =====
Weighted Average Number
of Common Shares
Outstanding
(in millions) 106.0 105.1 105.8 104.9
===== ===== ===== =====
</TABLE>
(See Accompanying Notes)
<PAGE>
<PAGE> 4
ORYX ENERGY COMPANY
CONDENSED CONSOLIDATED BALANCE SHEETS
<TABLE>
<CAPTION>
September 30 December 31
(Millions of Dollars) 1997 1996
(Unaudited)
<C> <C>
<S>
Assets
Current Assets
Cash and cash equivalents $ 13 $ 9
Accounts receivable and other
current assets 241 241
------ ------
Total Current Assets 254 250
Properties, Plants and Equipment
(net) (Note 5) 1,801 1,627
Deferred Charges and Other Assets 57 58
------ ------
Total Assets $2,112 $1,935
====== ======
Liabilities and Shareholders' Deficit
Current Liabilities
Accounts payable $ 161 $ 130
Accrued liabilities 274 251
Current portion of long-term debt 4 4
------ ------
Total Current Liabilities 439 385
Long-Term Debt (Note 6) 1,180 1,183
Deferred Income Taxes 236 248
Deferred Credits and Other
Liabilities 149 156
Shareholders' Equity (Deficit) (Note 7)
Common stock, par value $1 per
share 124 124
Additional paid-in capital 1,821 1,821
Accumulated deficit (770) (895)
------ ------
1,175 1,050
Less: Common stock in treasury,
at cost (970) (988)
Loan to ESOP (97) (99)
------ ------
Shareholders' Equity (Deficit) 108 (37)
------ ------
Total Liabilities and Shareholders'
Equity (Deficit) $2,112 $1,935
====== ======
</TABLE>
The successful efforts method of accounting is followed.
(See Accompanying Notes)
<PAGE>
<PAGE> 5
ORYX ENERGY COMPANY
CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS
<TABLE>
<CAPTION>
For the Nine Months
Ended September 30
(Millions of Dollars) 1997 1996
(Unaudited)
<C> <C>
<S>
Cash and Cash Equivalents From Operating
Activities
Net income $ 131 $ 100
Adjustments to reconcile net income
to net cash from operating activities:
Depreciation, depletion and
amortization 231 200
Dry hole costs and leasehold impairment 18 15
Loss on sale of assets, net of taxes 3 1
Deferred income taxes 21 37
Remeasurement of foreign deferred tax (4) -
Other 6 8
----- -----
406 361
Changes in working capital:
Accounts receivable and other current
assets (2) (29)
Accounts payable and accrued
liabilities 55 153
----- -----
Net Cash Flow Provided From Operating
Activities 459 485
----- -----
Investing Activities
Capital expenditures (410) (394)
Proceeds from divestments, net of current
taxes 1 4
Other (45) (19)
----- -----
Net Cash Flow Used For Investing Activities (454) (409)
----- -----
Financing Activities
Proceeds from borrowings 75 177
Repayments of long-term debt (78) (266)
ESOP loan repayment 2 -
----- -----
Net Cash Flow Used For
Financing Activities (1) (89)
Changes In Cash and Cash Equivalents 4 (13)
Cash and Cash Equivalents at Beginning
of Period 9 20
----- -----
Cash and Cash Equivalents at End of Period $ 13 $ 7
===== =====
</TABLE>
(See Accompanying Notes)
<PAGE>
<PAGE> 6
ORYX ENERGY COMPANY
NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS
1. Basis of Presentation
The accompanying condensed consolidated financial
statements and related notes of Oryx Energy Company and its
subsidiaries (hereinafter, unless the context otherwise
requires, being referred to as the Company) are presented
in accordance with the requirements of Form 10-Q and do not
include all disclosures normally required by generally
accepted accounting principles or those normally made in
annual reports on Form 10-K. In management's opinion, all
adjustments necessary for a fair presentation of the
results of operations for the periods shown have been made
and are of a normal recurring nature. The results of
operations of the Company for the nine months ended
September 30, 1997 are not necessarily indicative of the
results for the full year 1997.
Statements of Cash Flows
Amounts paid for interest and income taxes were as follows:
<TABLE>
<CAPTION>
Nine Months Ended September 30
1997 1996
(Millions of Dollars)
<C> <C>
<S>
Interest paid (net of
capitalized amounts) $ 77 $ 74
Income taxes paid $ 42 $ 2
</TABLE>
2. Provision for Restructuring
In the fourth quarter of 1995, the Company recognized a net
$25 million ($16 million after-tax) charge for restructuring
comprised of a $4 million adjustment to the 1994
restructuring provision and a $29 million restructuring
provision for a plan to achieve further cost reductions.
An analysis of the 1995 restructuring liability follows:
<TABLE>
<CAPTION>
1997 1997 1997
Balance First Second Third Balance
at Quarter Quarter Quarter at
12/31/96 Activity Activity Activity 9/30/97
(Millions of Dollars)
<C> <C> <C> <C> <C>
<S>
Office lease
obligation* $13 $(1) $(1) $ - $ 11
=== ==== ==== ==== ====
</TABLE>
* Represents contractual obligations existing
prior to the commitment date that will continue with
no economic benefit to the Company.
<PAGE>
<PAGE> 7
ORYX ENERGY COMPANY
NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS
(continued)
3. The Company utilizes collar, swap and put contracts to hedge
crude oil and natural gas prices.
4. Income Taxes
The Company's provisions for income taxes for the three and
nine months ended September 30, 1997 reflect provisions of
$12 million and $57 million. The Company's provisions for
income taxes for the three and nine months ended September
30, 1996 reflect provisions of $26 million and $57 million.
Foreign income tax provisions included within the Company's
consolidated provisions are determined based upon the
appropriate foreign statutory rates which differ from the
U.S. statutory rate.
Deferred income taxes are provided to reflect the tax
consequences in future periods of differences between
financial statements and tax basis of assets and liabilities
at period end in accordance with Statement of Financial
Accounting Standards No. 109, "Accounting for Income Taxes"
(SFAS No. 109). The remeasurement provisions of SFAS No.
109 have affected the reported earnings of the Company.
Earnings for the three and nine months ended September 30,
1997 increased $2 million and $4 million while reported
earnings for the three and nine months ended September 30,
1996 were unaffected. Management believes that such non-
cash remeasurements distort current period economic results
and should be disregarded in analyzing the Company's current
business. Future economic results may also be distorted
because payment of the deferred tax liability is not
expected to occur in the near-term and it is likely that
exchange rates will fluctuate prior to the eventual
settlement of the liability.
5. Properties, Plants and Equipment
At September 30, 1997 and December 31, 1996, the Company's
properties, plants and equipment; and related accumulated
depreciation, depletion and amortization were as follows:
<TABLE>
<CAPTION>
September 30, December 31,
1997 1996
(Millions of Dollars)
<C> <C>
<S>
Gross investment $ 5,561 $ 5,354
Less accumulated depreciation,
depletion and amortization 3,760 3,727
------- -------
Net investment $ 1,801 $ 1,627
======= =======
</TABLE>
<PAGE>
<PAGE> 8
ORYX ENERGY COMPANY
NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS
(continued)
6. Long-Term Debt
On July 3, 1997, the Board of Directors of the Company
authorized a plan to repurchase up to $50 million of its 7 1/2
percent Convertible Subordinated Debentures Due 1999 through
2014. The purchases, if and when made, will be in the open
market from time to time depending on market conditions.
There is no specific deadline for the program.
7. Shareholders' Equity (Deficit)
Shares of the Company's preferred and common stocks
authorized, issued, outstanding and in treasury at September
30, 1997 and December 31, 1996 were as follows:
<TABLE>
<CAPTION>
Authorized Issued Outstanding In Treasury
(Thousands of Shares)
<C> <C> <C> <C>
<S>
September 30, 1997
Preferred stock 15,000 - - -
Preference stock 7,741 - - -
Common stock 250,000 126,704 105,623 (18,079)
December 31, 1996
Preferred stock 15,000 - - -
Preference stock 7,741 - - -
Common stock 250,000 126,704 104,983 (18,719)
</TABLE>
8. Subsequent Events
Effective October 17, 1997, the Company replaced its $500
million borrowing-base credit facility with a new $500
million corporate credit facility which matures on October
17, 2002. The new credit facility provides the Company with
increased financial flexibility and less restrictive
covenants, while lowering interest expense.
<PAGE>
<PAGE> 9
REPORT OF INDEPENDENT ACCOUNTANTS
To the Shareholders and Board of Directors, Oryx Energy Company:
We have reviewed the accompanying condensed consolidated balance
sheet of Oryx Energy Company and its Subsidiaries as of September
30, 1997, the related condensed consolidated statements of income
for the three and nine months ended September 30, 1997 and 1996,
and the related condensed consolidated statements of cash flows
for the nine months ended September 30, 1997 and 1996. These
financial statements are the responsibility of the Company's
management.
We conducted our review in accordance with standards established
by the American Institute of Certified Public Accountants. A
review of interim financial information consists principally of
applying analytical review procedures to financial data and
making inquiries of persons responsible for financial and
accounting matters. It is substantially less in scope than an
audit conducted in accordance with generally accepted auditing
standards, the objective of which is the expression of an opinion
regarding the financial statements taken as a whole.
Accordingly, we do not express such an opinion.
Based on our review, we are not aware of any material
modifications that should be made to the accompanying condensed
consolidated financial statements for them to be in conformity
with generally accepted accounting principles.
We have previously audited, in accordance with generally accepted
auditing standards, the consolidated balance sheet of Oryx Energy
Company and its Subsidiaries as of December 31, 1996, and the
related consolidated statements of income and cash flows for the
year then ended (not presented herein); and in our report dated
February 19, 1997, we expressed an unqualified opinion on those
consolidated financial statements. In our opinion, the
information set forth in the accompanying condensed consolidated
balance sheet as of December 31, 1996 is fairly stated, in all
material respects, in relation to the consolidated balance sheet
from which it has been derived.
/s/ COOPERS & LYBRAND L.L.P.
Dallas, Texas
November 4, 1997
<PAGE>
<PAGE> 10
Item 2. Management's Discussion and Analysis of Financial
Condition and Results of Operations
FINANCIAL CONDITION
The Company's cash and cash equivalents increased by $4 million
over the nine months ended September 30, 1997. The increase was
comprised of $459 million of net cash flow provided from
operating activities, $454 million of net cash flow used for
investing activities and $1 million of net cash flow used for
financing activities. The $459 million in net cash flow provided
from operating activities consisted of $406 million in net cash
flow provided from operating activities before changes in current
assets and liabilities and $53 million provided from changes in
current assets and liabilities. The $406 million in net cash
flow provided from operating activities before changes in current
assets and liabilities was primarily impacted by increased crude
oil and U.S. natural gas volumes, an increase in natural gas
prices, offset in part, by a decrease in crude oil prices. The
$53 million of net cash flow provided from changes in current
assets and liabilities consisted of a $2 million increase in
accounts receivable and other current assets and a $55 million
increase in accounts payable and accrued liabilities.
The $454 million in net cash flow used for investing activities
is primarily due to $410 million of capital expenditures.
In the fourth quarter of 1995, the Company incurred a net $25
million ($16 million after-tax) provision for restructuring
comprised of a $4 million adjustment to the 1994 restructuring
provision and a $29 million restructuring provision for a plan to
achieve further cost reductions. For an analysis of the
restructuring provision, see Note 2 to the Condensed Consolidated
Financial Statements.
During February 1997, the Financial Accounting Standards Board
(FASB) issued Statement of Financial Accounting Standard (SFAS)
No. 128, "Earnings per Share" and SFAS No. 129, "Disclosure
of Information about Capital Structure," effective for fiscal years
beginning after December 15, 1997. The impact of these statements
when adopted, will not be material. In June 1997, the FASB
issued SFAS No. 130, "Reporting Comprehensive Income," and SFAS
No. 131, "Disclosures about Segments of an Enterprise and Related
Information," effective for fiscal years beginning after December
15, 1997. The impact of these statements when adopted, will not
be material.
On July 3, 1997, the Board of Directors of the Company authorized
a plan to repurchase up to $50 million of its 7 1/2 percent
Convertible Subordinated Debentures Due 1999 through 2014. The
purchases, if and when made, will be in the open market from time
to time depending on market conditions. There is no specific
deadline for the program.
<PAGE>
<PAGE> 11
Item 2. Management's Discussion and Analysis of Financial
Condition and Results of Operations - continued
FINANCIAL CONDITION (continued)
Effective October 17, 1997, the Company replaced its $500 million
borrowing-base credit facility with a new $500 million corporate
credit facility which matures on October 17, 2002. The new credit
facility provides the Company with increased financial
flexibility and less restrictive covenants, while lowering
interest expense.
RESULTS OF OPERATIONS - NINE MONTHS
The Company's net income for the nine months ended September 30,
1997 was $131 million, or $1.24 per share, as compared to net
income of $100 million, or $.95 per share for the first nine
months of 1996. Revenues for the nine months were $896 million
in 1997 versus $789 million in 1996. Year-to-date results for
1997 include a $3 million net loss on the sale of assets, a $5
million benefit associated with a change in the U.K. income tax
rate and a $4 million benefit from remeasurement of foreign
deferred taxes.
Average worldwide net production of crude oil and condensate for
the nine months ended September 30, 1997 was 116 thousand barrels
daily compared to average net production for the nine months
ended September 30, 1996 of 103 thousand barrels daily. Average
net production of crude oil and condensate was 46 thousand
barrels daily in the United States and 70 thousand barrels daily
from foreign locations during the nine months ended September 30,
1997, compared to 43 thousand barrels daily in the United States
and 60 thousand barrels daily from foreign locations during the
nine months ended September 30, 1996. The worldwide crude oil
and condensate price for the first nine months of 1997 was $18.58
per barrel compared to $18.75 per barrel for the first nine
months of 1996.
<PAGE>
<PAGE> 12
Item 2. Management's Discussion and Analysis of Financial
Condition and Results of Operations - continued
RESULTS OF OPERATIONS - NINE MONTHS (continued)
Average worldwide net production of natural gas was 508 million
cubic feet daily for the nine months ended September 30, 1997,
compared to 487 million cubic feet in the nine months ended
September 30, 1996. Average net production of natural gas was
497 million cubic feet daily in the United States and 11 million
cubic feet daily from the United Kingdom in the first nine months
of 1996, compared to 479 million cubic feet daily in the United
States and 8 million cubic feet daily in the United Kingdom in
the first nine months of 1996. The worldwide price of natural
gas for the first nine months of 1997 and 1996 was $2.35 and
$2.01 per thousand cubic feet.
RESULTS OF OPERATIONS - THREE MONTHS
The Company reported net income of $42 million, or $.40 per
share, for the quarter ended September 30, 1997, compared to net
income of $40 million, or $.38 per share, for the same quarter
last year. Revenues for the 1997 third quarter were $287 million
versus $289 million for the 1996 third quarter.
The 1997 third quarter includes a $2 million benefit for the
remeasurement of foreign deferred taxes and a $2 million benefit
primarily from a change in the U.K. income tax rate. By
comparison, the 1996 third quarter included $8 million resulting
from insurance refunds.
Compared to the same quarter last year, worldwide oil prices
decreased by $1.75 per barrel and U.S. natural gas prices
increased by $.17 per mcf. Crude oil volumes increased by 8,000
barrels per day, or 7 percent, and natural gas volumes decreased
14 million cubic feet per day.
The Company anticipates a much higher rate of exploration
activity in the fourth quarter, which could translate to higher
dry hole expense than the current quarter. However, currently
higher oil and gas prices are expected to more then offset this
additional expense.
Average worldwide net production of crude oil and condensate for
the three months ended September 30, 1997 was 117 thousand
barrels daily compared to average net production for the three
months ended September 30, 1996 of 109 thousand barrels daily.
Average net production of crude oil and condensate was 49
thousand barrels daily in the United States and 68 thousand
barrels daily from foreign locations during the three months
ended September 30, 1997, compared to 42 thousand barrels daily
in the United States and 67 thousand
<PAGE>
<PAGE> 13
Item 2. Management's Discussion and Analysis of Financial
Condition and Results of Operations - continued
RESULTS OF OPERATIONS - THREE MONTHS (continued)
barrels daily from foreign locations in the third quarter of
1996. The worldwide crude oil and condensate price in the third
quarter of 1997 was $18.01 per barrel compared to $19.76 per
barrel in the third quarter of 1996.
Average worldwide net production of natural gas was 488 million
cubic feet daily for the three months ended September 30, 1997,
compared to 502 million cubic feet daily in the three months
ended September 30, 1996. Average net production of natural gas
was 475 million cubic feet daily in the United States and 13
million cubic feet daily from the United Kingdom in the third
quarter of 1997, compared to 494 million cubic feet daily in the
United States and 8 million cubic feet daily from the United
Kingdom in the third quarter of 1996. The worldwide price of
natural gas for the third quarter of 1997 was $2.22 per thousand
cubic feet compared to $2.05 per thousand cubic feet in the third
quarter of 1996.
<PAGE>
<PAGE> 14
PART II
OTHER INFORMATION
Item 6. Exhibits and Reports on Form 8-K
(a) Exhibits:
10 Oryx Energy Company $500,000,000
Revolving Credit and Competitive Bid
Facility dated October 17, 1997.
12 Computation of Consolidated Ratio of
Earnings to Fixed Charges and Earnings
to Fixed Charges and Preferred Stock
Dividend Requirements.
15 Accountant's letter regarding
unaudited interim financial information.
27 Financial Data Schedule.
(b) Reports on Form 8-K:
The Company did not file any reports on Form
8-K during the quarter ended September 30, 1997.
<PAGE>
<PAGE> 15
SIGNATURE
Pursuant to the requirements of the Securities Exchange Act of
1934, the registrant has duly caused this report to be signed on
its behalf by the undersigned thereunto duly authorized.
ORYX ENERGY COMPANY
BY /s/ E. W. Moneypenny
E. W. Moneypenny
(Executive Vice President, Finance and
Chief Financial Officer)
DATE: November 4, 1997
<PAGE>
<TABLE> <S> <C>
<ARTICLE> 5
<LEGEND>
This schedule contains summary financial information extracted from SEC
Form 10-Q and is qualified in its entirety by reference to such financial
statements.
</LEGEND>
<MULTIPLIER> 1,000,000
<S> <C>
<PERIOD-TYPE> 9-MOS
<FISCAL-YEAR-END> DEC-31-1997
<PERIOD-END> SEP-30-1997
<CASH> 13
<SECURITIES> 0
<RECEIVABLES> 241
<ALLOWANCES> 0
<INVENTORY> 3
<CURRENT-ASSETS> 254
<PP&E> 5561
<DEPRECIATION> (3760)
<TOTAL-ASSETS> 2112
<CURRENT-LIABILITIES> 439
<BONDS> 1180
0
0
<COMMON> 1945
<OTHER-SE> 108
<TOTAL-LIABILITY-AND-EQUITY> 2112
<SALES> 912
<TOTAL-REVENUES> 896
<CGS> 548
<TOTAL-COSTS> 548
<OTHER-EXPENSES> 93
<LOSS-PROVISION> 0
<INTEREST-EXPENSE> 71
<INCOME-PRETAX> 184
<INCOME-TAX> 57
<INCOME-CONTINUING> 131
<DISCONTINUED> 0
<EXTRAORDINARY> 0
<CHANGES> 0
<NET-INCOME> 131
<EPS-PRIMARY> 1.24
<EPS-DILUTED> 1.24
</TABLE>
CONFORMED COPY
CREDIT AGREEMENT
dated as of
October 17, 1997
among
ORYX ENERGY COMPANY,
as Borrower
The Lenders Party Hereto,
NATIONSBANK OF TEXAS, N.A.,
as Administrative Agent
NATIONSBANC MONTGOMERY SECURITIES, INC.,
as Arranger
CHASE SECURITIES INC.,
as Syndication Agent
and
BARCLAYS BANK PLC,
as Documentation Agent
$500,000,000 REVOLVING CREDIT AND COMPETITIVE BID FACILITY
<PAGE>
TABLE OF CONTENTS
Page
ARTICLE I
Definitions 1
SECTION 1.01. Defined Terms 1
SECTION 1.02. Classification of Loans and
Borrowings 17
SECTION 1.03. Terms Generally 17
SECTION 1.04. Accounting Terms; GAAP 17
ARTICLE II
The Credits 17
SECTION 2.01. Commitments 18
SECTION 2.02. Loans and Borrowings 18
SECTION 2.03. Requests for Revolving Borrowings 19
SECTION 2.04. Competitive Bid Procedure 19
SECTION 2.05. Swingline Loans 22
SECTION 2.06. Letters of Credit 23
SECTION 2.07. Funding of Borrowings 29
SECTION 2.08. Interest Elections 29
SECTION 2.09. Termination and Reduction of
Commitments 31
SECTION 2.10. Repayment of Loans; Evidence of
Debt 31
SECTION 2.11. Prepayment of Loans 32
SECTION 2.12. Fees 33
SECTION 2.13. Interest 34
SECTION 2.14. Alternate Rate of Interest 35
SECTION 2.15. Increased Costs 35
SECTION 2.16. Break Funding Payments 37
SECTION 2.17. Taxes 38
SECTION 2.18. Payments Generally; Pro Rata
Treatment; Sharing of Set-offs 38
SECTION 2.19. Mitigation Obligations; Replacement
of Lenders 40
SECTION 2.20. Commitment Increases 41
ARTICLE III
Representations and Warranties 43
SECTION 3.01. Corporate Status 43
SECTION 3.02. Corporate Power and Authority 43
SECTION 3.03. No Violation 43
i
<PAGE>
SECTION 3.04. Litigation 43
SECTION 3.05. Financial Statements 44
SECTION 3.06. Governmental Approvals 44
SECTION 3.07. Use of Proceeds; Regulation U 44
SECTION 3.08. Investment Company Act 44
SECTION 3.09. Public Utility Holding Company Act 45
SECTION 3.10. True and Complete Disclosure 45
SECTION 3.11. No Default 45
SECTION 3.12. Ownership of Property 45
SECTION 3.13. ERISA 45
SECTION 3.14. Continuing Letters of Credit 45
ARTICLE IV
Conditions 46
SECTION 4.01. Effective Date 46
SECTION 4.02. Each Credit Event 47
ARTICLE V
Affirmative Covenants 48
SECTION 5.01. Financial Statements and Other
Information 48
SECTION 5.02. Notices of Material Events 49
SECTION 5.03. Existence; Conduct of Business 49
SECTION 5.04. Payment of Obligations 49
SECTION 5.05. Maintenance of Properties;
Insurance 50
SECTION 5.06. Compliance with Laws 50
ARTICLE VI
Negative Covenants 50
SECTION 6.01. Indebtedness of Subsidiaries 50
SECTION 6.02. Financial Covenants 50
SECTION 6.03. Liens 51
SECTION 6.04. Fundamental Changes 51
SECTION 6.05. Limitation on Affiliate
Transactions 51
SECTION 6.06. Energy Partners and SOLP 52
SECTION 6.07. Restrictions Affecting Subsidiaries 52
SECTION 6.08. Limitation on Sales and Leasebacks 52
ARTICLE VII
Events of Default 52
ii
<PAGE>
ARTICLE VIII
The Administrative Agent 55
SECTION 8.01. Appointment, Powers, and Immunities 55
SECTION 8.02. Reliance by Administrative Agent 56
SECTION 8.03. Defaults 56
SECTION 8.04. Rights as Lender 56
SECTION 8.05. Indemnification 57
SECTION 8.06. Non-Reliance on Administrative
Agent and Other Lenders 57
SECTION 8.07. Resignation of Administrative Agent 57
SECTION 8.08. Agents and Co-Agents 58
ARTICLE IX
Miscellaneous 58
SECTION 9.01. Notices 58
SECTION 9.02. Waivers; Amendments 59
SECTION 9.03. Expenses; Indemnity 60
SECTION 9.04. Successors and Assigns 61
SECTION 9.05. Survival 63
SECTION 9.06. Counterparts; Integration;
Effectiveness 63
SECTION 9.07. Severability 63
SECTION 9.08. Right of Setoff 64
SECTION 9.09. GOVERNING LAW; SUBMISSION TO
JURISDICTION; VENUE 64
SECTION 9.10. WAIVER OF JURY TRIAL 66
SECTION 9.11. Headings 66
SECTION 9.12. Confidentiality 66
SECTION 9.13. Interest 67
SECTION 9.14. Existing Credit Agreement 68
SECTION 9.15. Judgment in a Currency Other Than
Dollars 69
SCHEDULES:
Schedule 2.01 -- Commitments
Schedule 3.01 -- Subsidiaries
Schedule 3.14 -- Continuing Letters of Credit
EXHIBITS:
Exhibit A -- Form of Assignment and Acceptance
Exhibit B-1 -- Form of Opinion of Cravath, Swaine & Moore
Exhibit B-2 -- Form of Opinion of William C. Lemmer
iii
<PAGE>
Exhibit C -- Form of New Lender Supplement
Exhibit D -- Form of Commitment Increase Supplement
iv
<PAGE>
CREDIT AGREEMENT, dated as of October 17, 1997 (this
"Agreement"), among ORYX ENERGY COMPANY, a Delaware corporation
(the "Borrower"), the LENDERS party hereto (each a "Lender" and,
collectively, the "Lenders"), NATIONSBANC MONTGOMERY SECURITIES,
INC., as Arranger (the "Arranger"), CHASE SECURITIES INC., as
Syndication Agent (the "Syndication Agent"), BARCLAYS BANK PLC,
as Documentation Agent (the "Documentation Agent", and the
Arranger, Syndication Agent and Documentation Agent,
collectively, the "Agents") and NATIONSBANK OF TEXAS, N.A., as
Administrative Agent (in such capacity, the "Administrative
Agent").
W I T N E S S E T H :
WHEREAS, subject to and upon the terms and conditions
herein set forth, the Lenders are willing to make available to
the Borrower the credit facility provided for herein to meet the
Borrower's financing needs as of the date of this Agreement by
providing a revolving credit commitment in the amount of
$500,000,000 (the "Credit Facility");
WHEREAS, the Borrower, certain of the Lenders
("Original Lenders") and the Administrative Agent are parties to
that certain Revolving Credit Agreement dated as of June 1, 1995
(as amended to the Effective Date (as defined herein), the
"Existing Credit Agreement"), and certain of the Lenders ("New
Lenders") are not parties to the Existing Credit Agreement;
WHEREAS, the New Lenders have agreed, subject to the
terms and conditions contained herein, to enter into this
Agreement to make available to the Borrower the credit facility
provided for herein; and
WHEREAS, the Original Lenders have agreed, subject to
the terms and conditions herein (which are different from the
terms and conditions of the Existing Credit Agreement), to make
available to the Borrower the credit facility provided for
herein;
NOW, THEREFORE, in consideration of the premises and
the mutual covenants herein contained, the parties to this
Agreement hereby agree as follows:
ARTICLE I
Definitions
SECTION .01. Defined Terms. As used in this
Agreement, the following terms have the meanings specified below:
<PAGE>
<PAGE> 2
"Absolute Rate" means, with respect to any Competitive
Loan (other than a Eurodollar Competitive Loan), the fixed rate
of interest per annum specified by the Lender making such
Competitive Loan in its related Competitive Bid.
"Absolute Rate Loan" means a Competitive Loan bearing
interest at an Absolute Rate.
"Adjusted LIBO Rate" means, with respect to any
Eurodollar Borrowing for any Interest Period, an interest rate
per annum (rounded upwards, if necessary, to the next 1/100 of
1%) equal to (a) the LIBO Rate for such Interest Period
multiplied by (b) the Statutory Reserve Rate.
"Administrative Agent" means NationsBank of Texas,
N.A., in its capacity as administrative agent for the Lenders
hereunder.
"Affiliate" of any Person shall mean (a) any Person
(other than a Subsidiary of such Person) that, directly or
indirectly, is in control of, is controlled by, or is under
common control with, such Person or (b) any Person who is a
director or officer of (i) such Person, (ii) any Subsidiary of
such Person or (iii) any Person described in clause (a) above.
For purposes of this definition, control of a Person shall mean
the power, direct or indirect, to direct or cause the direction
of the management and policies of such Person whether by contract
or otherwise.
"Alternate Currency" shall mean the lawful currency of
the United Kingdom.
"Alternate Currency Letter of Credit" shall have the
meaning set forth in Section 2.06(k).
"Applicable Percentage" means, with respect to any
Lender, the percentage of the total Commitments represented by
such Lender's Commitment. If the Commitments have terminated or
expired, the Applicable Percentages shall be determined based
upon the Commitments most recently in effect, giving effect to
any assignments.
"Applicable Period" shall mean (i) in the case of a
judgment entered by a U.S. Federal or state court, 60 days and
(ii) in the case of a judgment entered by any other court, 90
days.
"Applicable Rate" means, for any day, with respect to
any Base Rate Loan or Eurodollar Revolving Loan, or with respect
to the commitment fees payable hereunder, as the case may be, the
applicable rate per annum set forth below under the caption "Base
Rate Spread", "Eurodollar Spread" or "Commitment Fee Rate", as
the case may be, based upon the ratings by Moody's and S&P,
respectively, applicable on such date to the Index Debt:
<PAGE>
<PAGE> 3
Base Rate Eurodollar Commitment
Index Debt Ratings: Spread Spread Fee
Rate
Category 1
>BBB+ or Baa1 0.0% 0.2500% 0.0900%
Category 2
> BBB or Baa2 0.0% 0.3250% 0.1200%
Category 3
> BBB- or Baa3 0.0% 0.4500% 0.1350%
Category 4
> BB+ or Ba1 0.0% 0.5500% 0.1750%
Category 5
< BB+ or Ba1 0.0% 0.7500% 0.2500%
For purposes of the foregoing, (i) if either Moody's or
S&P shall not have in effect a rating for the Index Debt (other
than by reason of the circumstances referred to in the last
sentence of this definition), then such rating agency shall be
deemed to have established a rating in Category 5; (ii) if the
ratings established or deemed to have been established by Moody's
and S&P for the Index Debt shall fall within different
Categories, the Applicable Rate shall be based on the higher of
the two ratings unless one of the two ratings is two or more
Categories lower than the other, in which case the Applicable
Rate shall be determined by reference to the Category next below
that of the higher of the two ratings; and (iii) if the ratings
established or deemed to have been established by Moody's and S&P
for the Index Debt shall be changed (other than as a result of a
change in the rating system of Moody's or S&P), such change shall
be effective as of the date on which it is first announced by the
applicable rating agency. Each change in the Applicable Rate
shall apply during the period commencing on the effective date of
such change and ending on the date immediately preceding the
effective date of the next such change. If the rating system of
Moody's or S&P shall change, or if either such rating agency
shall cease to be in the business of rating corporate debt
obligations, the Borrower and the Lenders shall negotiate in good
faith to amend this definition to reflect such changed rating
system or the unavailability of ratings from such rating agency
and, pending the effectiveness of any such amendment, the
Applicable Rate shall be determined by reference to the rating
most recently in effect prior to such change or cessation.
"Assignment and Acceptance" means an assignment and
acceptance entered into by a Lender and an assignee (with the
consent of any party whose
<PAGE>
<PAGE> 4
consent is required by Section 9.04), and accepted by the
Administrative Agent, in the form of Exhibit A or any other form
approved by the Administrative Agent.
"Availability Period" means the period from and
including the Effective Date to but excluding the earlier of the
Maturity Date and the date of termination of the Commitments.
"Base Rate" means, for any day, the rate per annum
equal to the higher of (a) the Federal Funds Rate for such day
plus one-half of one percent (.5%) and (b) the Prime Rate for
such day. Any change in the Base Rate due to a change in the
Prime Rate or the Federal Funds Rate shall be effective on the
effective date of such change in the Prime Rate or Federal Funds
Rate. "Base Rate", when used in reference to any Loan or
Borrowing, refers to whether such Loan, or the Loans comprising
such Borrowing, are bearing interest at a rate determined by
reference to the Base Rate.
"Board" means the Board of Governors of the Federal
Reserve System of the United States of America.
"Borrower" means Oryx Energy Company, a Delaware
corporation.
"Borrowing" means (a) Revolving Loans of the same Type,
made, converted or continued on the same date and, in the case of
Eurodollar Loans, as to which a single Interest Period is in
effect, (b) a Competitive Loan or group of Competitive Loans of
the same Type made on the same date and as to which a single
Interest Period is in effect or (c) a Swingline Loan.
"Borrowing Request" means a request by the Borrower for
a Revolving Borrowing in accordance with Section 2.03.
"Business Day" means any day that is not a Saturday,
Sunday or other day on which commercial banks in New York City or
in the State of Texas are authorized or required by law to remain
closed; provided that, when used in connection with a Eurodollar
Loan, the term "Business Day" shall also exclude any day on which
banks are not open for dealings in dollar deposits in the London
interbank market.
"Cash Exploration Expenses" means, for any period, the
aggregate amount of (a) costs for geological and geophysical
studies and associated activities, (b) administrative expenses
associated with exploration activities and (c) lease rentals
payable by the Borrower and its Subsidiaries for such period
accrued in connection with the search for oil and/or gas
reserves.
"Change in Law" means (a) the adoption of any law, rule
or regulation after the date of this Agreement, (b) any change in
any law, rule or regulation or in the interpretation or
application thereof by any Governmental Authority after the date
of this Agreement or (c) compliance by any Lender or the Issuing
Bank (or, for purposes of Section 2.15(b), by any
<PAGE>
<PAGE> 5
lending office of such Lender or by such Lender's or the Issuing
Bank's holding company, if any) with any request, guideline or
directive (whether or not having the force of law) of any
Governmental Authority made or issued after the date of this
Agreement.
"Class", when used in reference to any Loan or
Borrowing, refers to whether such Loan, or the Loans comprising
such Borrowing, are Revolving Loans, Competitive Loans or
Swingline Loans.
"Code" means the Internal Revenue Code of 1986, as
amended from time to time.
"Commitment" means, with respect to each Lender, the
commitment of such Lender to make Revolving Loans and to acquire
participations in Letters of Credit and Swingline Loans
hereunder, expressed as an amount representing the maximum
aggregate amount of such Lender's Revolving Credit Exposure
hereunder, as such commitment may be (a) reduced from time to
time pursuant to Section 2.09, (b) reduced or increased from time
to time pursuant to assignments by or to such Lender pursuant to
Section 9.04 or (c) increased from time to time pursuant to
Section 2.20. The initial amount of each Lender's Commitment is
set forth on Schedule 2.01, or in the Assignment and Acceptance
pursuant to which such Lender shall have assumed its Commitment,
as applicable.
"Competitive Bid" means an offer by a Lender to make a
Competitive Loan in accordance with Section 2.04.
"Competitive Bid Rate" means, with respect to any
Competitive Bid, the Margin or the Absolute Rate, as applicable,
offered by the Lender making such Competitive Bid.
"Competitive Bid Request" means a request by the
Borrower for Competitive Bids in accordance with Section 2.04.
"Competitive Loan" means a Loan made pursuant to
Section 2.04.
"Consolidated Debt" shall mean, as of any date, the sum
of the amounts that would be included as long-term debt or
current portion of long-term debt on a consolidated balance sheet
of the Borrower and its consolidated Subsidiaries prepared as of
such date in accordance with GAAP.
"Consolidated Total Indebtedness" shall mean, at any
particular date, the outstanding principal amount of Indebtedness
of the Borrower and its Subsidiaries, determined on a
consolidated basis, as of the end of the most recent fiscal
quarter ending prior to such date for which quarterly or annual
financial statements have been delivered pursuant to Section
5.01.
<PAGE>
<PAGE> 6
"Contingent Obligation" shall mean, as to any Person,
any obligation of such Person guaranteeing or intended to
guarantee any Indebtedness or dividends ("primary obligations")
of any other Person (the "primary obligor") in any manner,
whether directly or indirectly, including, without limitation,
any obligation of such 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 (x) for the purchase or payment of any such primary
obligation or (y) to maintain working capital or equity capital
of the primary obligor or otherwise to maintain the net worth or
solvency of the primary obligor 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, (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 holder of such primary obligation against loss in respect
thereof; provided, however, that the term Contingent Obligation
shall not include endorsements of instruments for deposit or
collection in the ordinary course of business. The amount of any
Contingent Obligation shall be deemed to be an amount equal to
the lesser of (A) the stated or determinable amount of the
primary obligation in respect of which such Contingent Obligation
is made or, if not stated or determinable, the maximum reasonably
anticipated liability in respect thereof (assuming such Person is
required to perform thereunder) as determined by such Person in
good faith or (B) the maximum stated amount of such Person's
liability in respect of the primary obligation.
"Continuing Letters of Credit" shall have the meaning
set forth in Section 3.14.
"Contractual Obligation" shall mean, as to any Person,
any provision of any security issued by such Person or of any
agreement, instrument or other undertaking to which such Person
is a party or by which it or any of its property is bound.
"Control" means the possession, directly or indirectly,
of the power to direct or cause the direction of the management
or policies of a Person, whether through the ability to exercise
voting power, by contract or otherwise. "Controlling" and
"Controlled" have meanings correlative thereto.
"Default" means any event or condition which
constitutes an Event of Default or which upon notice, lapse of
time or both would, unless cured or waived, become an Event of
Default.
"Disclosed Matters" means the actions, suits and
proceedings and the environmental matters disclosed in
Schedule 3.04.
"Discretionary Cash Flow" shall mean Net Cash Flow From
Operating Activities before working capital changes, plus Cash
Exploration Expenses.
<PAGE>
<PAGE> 7
"Dollar Equivalent" shall mean, on or as of a
particular date, with respect to LC Exposures in respect of
Alternate Currency Letters of Credit, the amount of Dollars, as
conclusively determined by the Administrative Agent, which is
required by the Administrative Agent to purchase the Alternate
Currency amount of such LC Exposures on or as of such date on the
basis of the spot exchange rate therefor in the interbank
currency market where the foreign currency and exchange
operations of the Administrative Agent are customarily conducted
with respect to the Alternate Currency as at 10:00 A.M. (or as
near thereto as may be practicable), New York City time, on or as
of such date.
"Dollars" or "$" refers to lawful money of the United
States of America.
"Effective Date" means the date on which the conditions
specified in Section 4.01 are satisfied (or waived in accordance
with Section 9.02).
"Eligible Assignee" means (i) a Lender, (ii) an
affiliate of a Lender, and (iii) any other Person approved by the
Agent and the Borrower, such approval not to be unreasonably
withheld; provided, however, that neither the Borrower nor an
affiliate of the Borrower shall qualify as an Eligible Assignee.
"Energy Partners" shall mean Sun Energy Partners, L.P.,
a Delaware limited partnership.
"Environmental Laws" means all laws, rules,
regulations, codes, ordinances, orders, decrees, judgments,
injunctions, notices or binding agreements issued, promulgated or
entered into by any Governmental Authority, relating in any way
to the environment, preservation or reclamation of natural
resources, the management, release or threatened release of any
Hazardous Material or to health and safety matters.
"Environmental Liability" means any liability,
contingent or otherwise (including any liability for damages,
costs of environmental remediation, fines, penalties or
indemnities), of the Borrower or any Subsidiary directly or
indirectly resulting from or based upon (a) violation of any
Environmental Law, (b) the generation, use, handling,
transportation, storage, treatment or disposal of any Hazardous
Materials, (c) exposure to any Hazardous Materials, (d) the
release or threatened release of any Hazardous Materials into the
environment or (e) any contract, agreement or other consensual
arrangement pursuant to which liability is assumed or imposed
with respect to any of the foregoing.
"ERISA" means the Employee Retirement Income Security
Act of 1974, as amended from time to time.
"ERISA Affiliate" means any trade or business (whether
or not incorporated) that, together with the Borrower, is treated
as a single employer under Section 414(b) or (c) of the Code or,
solely for purposes of
<PAGE>
<PAGE> 8
Section 302 of ERISA and Section 412 of the Code, is treated as a
single employer under Section 414 of the Code.
"ERISA Event" means (a) any "reportable event", as
defined in Section 4043 of ERISA or the regulations issued
thereunder with respect to a Plan (other than an event for which
the 30-day notice period is waived); (b) the existence with
respect to any Plan of an "accumulated funding deficiency" (as
defined in Section 412 of the Code or Section 302 of ERISA),
whether or not waived; (c) the filing pursuant to Section 412(d)
of the Code or Section 303(d) of ERISA of an application for a
waiver of the minimum funding standard with respect to any Plan;
(d) the incurrence by the Borrower or any of its ERISA Affiliates
of any liability under Title IV of ERISA with respect to the
termination of any Plan; (e) the receipt by the Borrower or any
ERISA Affiliate from the PBGC or a plan administrator appointed
under Section 4042(b) of ERISA of any notice relating to an
intention to terminate any Plan or Plans or to appoint a trustee
under said Section 4042(b) to administer any Plan; (f) the
incurrence by the Borrower or any of its ERISA Affiliates of any
liability with respect to the withdrawal or partial withdrawal
from any Plan pursuant to Section 4063 of ERISA or Multiemployer
Plan; or (g) the receipt by the Borrower or any ERISA Affiliate
of any notice, or the receipt by any Multiemployer Plan from the
Borrower or any ERISA Affiliate of any notice, concerning the
imposition of Withdrawal Liability or a determination that a
Multiemployer Plan is, or is expected to be, insolvent or in
reorganization, within the meaning of Title IV of ERISA.
"Eurodollar", when used in reference to any Loan or
Borrowing, refers to whether such Loan, or the Loans comprising
such Borrowing, are bearing interest at a rate determined by
reference to the Adjusted LIBO Rate (or, in the case of a
Competitive Loan, the LIBO Rate).
"Event of Default" has the meaning assigned to such
term in Article VII.
"Excluded Taxes" means, with respect to the
Administrative Agent, any Lender, the Issuing Bank or any other
recipient of any payment to be made by or on account of any
obligation of the Borrower hereunder, (a) income or franchise
taxes imposed on (or measured by) its net income by the United
States of America, or by the jurisdiction under the laws of which
such recipient is organized or in which its principal office is
located or, in the case of any Lender, in which its applicable
lending office is located, (b) any branch profits taxes imposed
by the United States of America or any similar tax imposed by any
other jurisdiction in which the Borrower is located and (c) in
the case of a Foreign Lender (other than an assignee pursuant to
a request by the Borrower under Section 2.19(b)), any withholding
tax that is imposed on amounts payable to such Foreign Lender at
the time such Foreign Lender becomes a party to this Agreement or
is attributable to such Foreign Lender's failure or inability to
comply with Section 2.17(e), except to the extent that such
Foreign Lender's assignor (if any) was entitled, at the time of
assignment, to
<PAGE>
<PAGE> 9
receive additional amounts from the Borrower with respect to such
withholding tax pursuant to Section 2.17(a).
"Federal Funds Rate" means, for any day, the weighted
average (rounded upwards, if necessary, to the next 1/100 of 1%)
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 that is a Business Day, the average (rounded upwards,
if necessary, to the next 1/100 of 1%) of the quotations for such
day for such transactions received by the Administrative Agent
from three Federal funds brokers of recognized standing selected
by it.
"Financial Officer" means the chief financial officer,
principal accounting officer or treasurer of the Borrower.
"Financing Lease" shall mean any lease of property,
real or personal, the obligations of the lessee in respect of
which are required in accordance with GAAP to be capitalized on a
balance sheet of the lessee.
"Foreign Lender" means any Lender that is organized
under the laws of a jurisdiction other than that in which the
Borrower is located. For purposes of this definition, the United
States of America, each State thereof and the District of
Columbia shall be deemed to constitute a single jurisdiction.
"GAAP" means generally accepted accounting principles
in the United States of America.
"Governmental Authority" means the government of the
United States of America, any other nation or any political
subdivision thereof, whether state or local, and any agency,
authority, instrumentality, regulatory body, court, central bank
or other entity exercising executive, legislative, judicial,
taxing, regulatory or administrative powers or functions of or
pertaining to government.
"Hazardous Materials" means all explosive or
radioactive substances or wastes and all hazardous or toxic
substances, wastes or other pollutants, including petroleum or
petroleum distillates, asbestos or asbestos containing materials,
polychlorinated biphenyls, radon gas, infectious or medical
wastes and all other substances or wastes of any nature regulated
pursuant to any Environmental Law.
"Highest Lawful Rate" shall mean, with respect to any
Indebtedness owed to any Lender hereunder, the maximum
nonusurious interest rate, if any, that at any time or from time
to time may be contracted for, taken, reserved, charged or
received by such Lender with respect to such Indebtedness under
applicable law. In the event that applicable law provides for an
interest ceiling under Texas Revised Civil Statutes Annotated
Article 5069-1.04, that ceiling shall be the Highest Lawful Rate.
As used in this definition the term
<PAGE>
<PAGE> 10
"applicable law" means, with respect to each Lender, whichever
laws allow the greater interest, as such laws now exist or may be
changed or amended or come into effect in the future.
"Indebtedness" shall mean, as to any Person, without
duplication, (i) all indebtedness of such Person for borrowed
money or for the deferred purchase price of property or services
(but excluding the deferred purchase price of property or
services to the extent that such deferments are taken in the
ordinary course of such Person's business consistent with prudent
business practices), (ii) the face amount of all letters of
credit issued for the account of such Person in respect of
liabilities of the type described in clauses (i), (iv) and (v) of
this definition and all drafts drawn thereunder, (iii) all
liabilities of the type described in clauses (i), (ii), (iv) and
(v) of this definition which are secured by any Lien on any
property owned by such Person, whether or not such liabilities
have been assumed by such Person (limited however to the lesser
of (a) the amount of its liability or (b) the value of such
property), (iv) all obligations of such Person under Financing
Leases, (v) all Contingent Obligations of such Person and (vi)
all Redeemable Preferred Stock of such Person; provided that for
the purposes of this Agreement, the term "Indebtedness" shall not
include any of the foregoing which (x) are owing to the Borrower
or any Wholly Owned Subsidiary of the Borrower (except for the
purposes of the proviso to Section 6.01), (y) are subject to
irrevocable legal defeasance in accordance with the terms thereof
or (z) arise out of the sale of receivables.
"Indemnified Taxes" means Taxes other than Excluded
Taxes.
"Index Debt" means senior, unsecured, long-term
indebtedness for borrowed money of the Borrower that is not
guaranteed by any other Person or subject to any other credit
enhancement.
"Interest Election Request" means a request by the
Borrower to convert or continue a Revolving Borrowing in
accordance with Section 2.08.
"Interest Payment Date" means (a) with respect to any
Base Rate Loan (other than a Swingline Loan), the last day of
each March, June, September and December, (b) with respect to any
Eurodollar Loan, the last day of the Interest Period applicable
to the Borrowing of which such Loan is a part and, in the case of
a Eurodollar Borrowing with an Interest Period of more than three
months' duration, each day prior to the last day of such Interest
Period that occurs at intervals of three months' duration after
the first day of such Interest Period, (c) with respect to any
Absolute Rate Loan, the last day of the Interest Period
applicable to the Borrowing of which such Loan is a part and, in
the case of a Absolute Rate Borrowing with an Interest Period of
more than 90 days' duration (unless otherwise specified in the
applicable Competitive Bid Request), each day prior to the last
day of such Interest Period that occurs at intervals of 90 days'
duration after the first day of such Interest Period, and any
other dates that are specified in the applicable Competitive Bid
Request as Interest Payment Dates with respect to
<PAGE>
<PAGE> 11
such Borrowing and (d) with respect to any Swingline Loan, the
day that such Loan is required to be repaid.
"Interest Period" means (a) with respect to any
Eurodollar Borrowing, the period commencing on the date of such
Borrowing and ending on the numerically corresponding day in the
calendar month that is one, two, three or six months (or, with
the consent of each Lender, nine or twelve months) thereafter, as
the Borrower may elect, (b) with respect to any Absolute Rate
Borrowing, the period (which shall not be less than 7 days or
more than 180 days) commencing on the date of such Borrowing and
ending on the date specified in the applicable Competitive Bid
Request; provided, that (i) if any Interest Period would end on a
day other than a Business Day, such Interest Period shall be
extended to the next succeeding Business Day unless, in the case
of a Eurodollar Borrowing only, such next succeeding Business Day
would fall in the next calendar month, in which case such
Interest Period shall end on the next preceding Business Day and
(ii) any Interest Period pertaining to a Eurodollar Borrowing
that commences on the last Business Day of a calendar month (or
on a day for which there is no numerically corresponding day in
the last calendar month of such Interest Period) shall end on the
last Business Day of the last calendar month of such Interest
Period. For purposes hereof, the date of a Borrowing initially
shall be the date on which such Borrowing is made and, in the
case of a Revolving Borrowing, thereafter shall be the effective
date of the most recent conversion or continuation of such
Borrowing.
"Issuing Bank" means NationsBank or such other Lender
as designated by the Borrower and agreed to by such Issuing Bank,
in its capacity as the issuer of Letters of Credit hereunder, and
its successors in such capacity as provided in Section 2.06(i).
"LC Disbursement" means a payment made by the Issuing
Bank pursuant to a Letter of Credit.
"LC Exposure" means, at any time, the sum of (a) the
aggregate undrawn amount of all outstanding Letters of Credit at
such time plus (b) the aggregate amount of all LC Disbursements
that have not yet been reimbursed by or on behalf of the Borrower
at such time. The LC Exposure of any Lender at any time shall be
its Applicable Percentage of the total LC Exposure at such time.
"Lenders" means the Persons listed on Schedule 2.01 and
any other Person that shall have become a party hereto pursuant
to an Assignment and Acceptance, other than any such Person that
ceases to be a party hereto pursuant to an Assignment and
Acceptance. Unless the context otherwise requires, the term
"Lenders" includes the Swingline Lender.
"Letter of Credit" means any letter of credit issued
pursuant to this Agreement and Continuing Letters of Credit.
<PAGE>
<PAGE> 12
"LIBO Rate" means, for any Eurodollar Borrowing for any
Interest Period therefor, the rate per annum (rounded upwards, if
necessary, to the nearest 1/100 of 1%) appearing on Telerate Page
3750 (or any successor page) as the London interbank offered rate
for deposits in Dollars at approximately 11:00 a.m. (London time)
two Business Days prior to the first day of such Interest Period
for a term comparable to such Interest Period. If for any reason
such rate is not available, the term "LIBO Rate" shall mean, for
any Eurodollar Borrowing for any Interest Period therefor, the
rate per annum (rounded upwards, if necessary, to the nearest
1/100 of 1%) appearing on Reuters Screen LIBO Page as the London
interbank offered rate for deposits in Dollars at approximately
11:00 a.m. (London time) two Business Days prior to the first day
of such Interest Period for a term comparable to such Interest
Period; provided, however, if more than one rate is specified on
Reuters Screen LIBO Page, the applicable rate shall be the
arithmetic mean of all such rates (rounded upwards, if necessary,
to the nearest 1/100 of 1%).
"Lien" shall mean any mortgage, pledge, security
interest, encumbrance, or lien of any kind (including any
agreement to give any of the foregoing, any conditional sale or
other title retention agreement or any lease in the nature
thereof); provided, that neither the sale of receivables nor any
filing of financing statements or other instruments made or given
in furtherance thereof shall be deemed to constitute a Lien.
"Loans" means the loans made by the Lenders to the
Borrower pursuant to this Agreement.
"Margin" means, with respect to any Competitive Loan
bearing interest at a rate based on the LIBO Rate, the marginal
rate of interest, if any, to be added to or subtracted from the
LIBO Rate to determine the rate of interest applicable to such
Loan, as specified by the Lender making such Loan in its related
Competitive Bid.
"Material Adverse Effect" shall mean a material adverse
effect on (a) the financial condition or results of operations of
the Borrower and its Subsidiaries taken as a whole or (b) the
ability of the Borrower to perform its obligations under this
Agreement.
"Material Subsidiary" shall mean at any particular
date, each Subsidiary of the Borrower the total assets of which
comprise ten percent (10%) or more of the consolidated total
assets of the Borrower.
"Maturity Date" means October 17, 2002.
"Moody's" means Moody's Investors Service, Inc.
"Multiemployer Plan" means a multiemployer plan as
defined in Section 4001(a)(3) of ERISA.
<PAGE>
<PAGE> 13
"NationsBank" means NationsBank of Texas, N.A.
"Net Cash Flow From Operating Activities" means, with
respect to any Person for any period, the net cash flow provided
from operating activities of such Person as shown in such
Person's statement of cash flows for such period, determined on a
consolidated basis in accordance with GAAP.
"Oil and Gas Interests" shall mean (i) leasehold or
other interests in or under oil, gas or other mineral leases, fee
interests, overriding royalty, royalty or other real property
interests in oil, gas or other liquid or gas hydrocarbons in
place, all licenses, permits or production sharing agreements
with respect to oil, gas and other liquid or gas hydrocarbons to
be produced, all plants, facilities, including without limitation
cogeneration facilities, pipelines, gathering systems and all
items of equipment or fixtures used in connection with the
production, gathering, processing or transportation of oil, gas
or other liquid or gas hydrocarbons, (ii) without duplication of
the foregoing, all Proved Reserves and (iii) the capital stock of
any Subsidiary of the Borrower whose assets are comprised
principally or in substantial part of assets described in the
foregoing clauses (i)-(ii).
"Other Taxes" means 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.
"PBGC" means the Pension Benefit Guaranty Corporation
referred to and defined in ERISA and any successor entity
performing similar functions.
"Permitted Liens" shall mean:
(a) Attachments or judgments which give rise to Liens
or other similar Liens arising in connection with litigation
or other legal proceedings (and not otherwise an Event of
Default hereunder);
(b) Liens on assets acquired by the Borrower or any of
its Subsidiaries and Liens on assets of entities that become
Subsidiaries of the Borrower, which Liens existed prior to
the date such assets are acquired or such entities become
Subsidiaries, as the case may be, provided that such Liens
were not incurred solely in contemplation of such
acquisitions;
(c) (i) purchase money security interests in real
property, interests therein, improvements thereto or
equipment acquired (or, in the case of improvements,
constructed) by the Borrower or any Subsidiary ("Purchase
Money Liens"), provided, that the aggregate principal amount
of Indebtedness secured by any Lien referred to in this
clause shall not exceed 80% of the purchase price or cost of
construction of the asset encumbered thereby and (ii)
Financing Leases; and
<PAGE>
<PAGE> 14
(d) Liens securing Indebtedness (excluding the amount
of all Indebtedness secured by Liens permitted by clauses
(a) through (c) above) the aggregate principal amount of
which does not exceed $100,000,000.
"Person" means any natural person, corporation, limited
liability company, trust, joint venture, association, company,
partnership, Governmental Authority or other entity.
"Petroleum" shall mean oil, gas and other liquid or
gaseous hydrocarbons, including, without limitation, all
liquefiable hydrocarbons and other products which may be
extracted from gas and gas condensate by the processing thereof
in a gas processing plant.
"Plan" means any employee pension benefit plan (other
than a Multiemployer Plan) subject to the provisions of Title IV
of ERISA or Section 412 of the Code or Section 302 of ERISA, and
in respect of which the Borrower or any ERISA Affiliate is (or,
if such plan were terminated, would under Section 4069 of ERISA
be deemed to be) an "employer" as defined in Section 3(5) of
ERISA.
"Prime Rate" means the per annum rate of interest
established from time to time by NationsBank as its prime rate,
which rate may not be the lowest rate of interest charged by
NationsBank to its customers.
"Proved Reserves" shall mean proved developed
producing, proved developed non-producing and proved undeveloped
Petroleum reserves of the Borrower and its Subsidiaries and its
50% owned Affiliates as determined in accordance with standards
established by The Society of Petroleum Engineers.
"Quality" shall mean as to any Petroleum reserves,
their nature as proved developed producing, proved developed
nonproducing, proved undeveloped or probable.
"Reimbursement Obligation" shall mean the obligation of
the Borrower to reimburse the Issuing Bank pursuant to
Section 2.06 for amounts drawn under Letters of Credit.
"Register" has the meaning set forth in Section 9.04.
"Related Parties" means, with respect to any specified
Person, such Person's Affiliates and the respective directors,
officers, employees, agents and advisors of such Person and such
Person's Affiliates.
"Required Lenders" means, at any time, Lenders having
Revolving Credit Exposures and unused Commitments representing at
least a majority of the sum of the total Revolving Credit
Exposure and unused Commitments at such time; provided that, for
purposes of declaring the Loans to be due and payable
<PAGE>
<PAGE> 15
pursuant to Article VII, and for all purposes after the Loans
become due and payable pursuant to Article VII or the Commitments
expire or terminate, the outstanding Competitive Loans of the
Lenders shall be included in their respective Revolving Credit
Exposures in determining the Required Lenders.
"Requirement of Law" shall mean, 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.
"Revolving Credit Exposure" means, with respect to any
Lender at any time, the sum of the outstanding principal amount
of such Lender's Revolving Loans and its LC Exposure and
Swingline Exposure at such time.
"Revolving Loan" means a Loan made pursuant to Section
2.03.
"S&P" means Standard & Poor's Ratings Services, a
Division of The McGraw-Hill Companies, Inc.
"SOLP" shall mean Sun Operating Limited Partnership, a
Delaware limited partnership.
"Statutory Reserve Rate" means a fraction (expressed as
a decimal), the numerator of which is the number one and the
denominator of which is the number one minus the aggregate of the
maximum reserve percentages (including any marginal, special,
emergency or supplemental reserves) expressed as a decimal
established by the Board to which the Administrative Agent is
subject with respect to the Adjusted LIBO Rate, for eurocurrency
funding (currently referred to as "Eurocurrency Liabilities" in
Regulation D of the Board). Such reserve percentages shall
include those imposed pursuant to such Regulation D. Eurodollar
Loans shall be deemed to constitute eurocurrency funding and to
be subject to such reserve requirements without benefit of or
credit for proration, exemptions or offsets that may be available
from time to time to any Lender under such Regulation D or any
comparable regulation. The Statutory Reserve Rate shall be
adjusted automatically on and as of the effective date of any
change in any reserve percentage.
"subsidiary" of any Person shall mean and include
(i) any corporation more than 50% of whose stock of any class or
classes having by the terms thereof ordinary voting power to
elect a majority of the directors of such corporation
(irrespective of whether or not at the time stock of any class or
classes of such corporation shall have or might have voting power
by reason of the happening of any contingency) is at the time
owned by such Person directly or indirectly through Subsidiaries
and (ii) any partnership, association, joint venture, trust or
other entity in which such Person
<PAGE>
<PAGE> 16
directly or indirectly through Subsidiaries, has more than a 50%
equity or beneficial ownership interest at the time.
"Subsidiary" means any subsidiary of the Borrower.
"Swingline Exposure" means, at any time, the aggregate
principal amount of all Swingline Loans outstanding at such time.
The Swingline Exposure of any Lender at any time shall be its
Applicable Percentage of the total Swingline Exposure at such
time.
"Swingline Lender" means NationsBank, in its capacity
as lender of Swingline Loans hereunder.
"Swingline Loan" means a Loan made pursuant to Section
2.05.
"Taxes" means any and all present or future taxes,
levies, imposts, duties, deductions, charges or withholdings
imposed by any Governmental Authority.
"Tangible Net Worth" means (a) shareholder's equity
(determined in accordance with GAAP), less (b) intangible net
assets, plus (c) the aggregate amount of any non-cash write-downs
during the Availability Period.
"Transactions" means the execution, delivery and
performance by the Borrower of this Agreement, the borrowing of
Loans, the use of the proceeds thereof and the issuance of
Letters of Credit hereunder.
"Type", when used in reference to any Loan or
Borrowing, refers to whether the rate of interest on such Loan,
or on the Loans comprising such Borrowing, is determined by
reference to the Adjusted LIBO Rate, the Base Rate or, in the
case of a Competitive Loan or Borrowing, the LIBO Rate or a
Absolute Rate.
"Wholly-Owned Subsidiary": shall mean, as to any
Person, any subsidiary of such Person to the extent all of the
capital stock or other ownership interest of such subsidiary,
other than directors' or nominees' qualifying shares or shares or
other ownership interests required by law, statute, rule or
regulation to be held by government entities or foreign nationals
to the extent not in excess of 5% of the issued and outstanding
capital stock or other ownership interest of such subsidiary, is
owned directly or indirectly by such Person, provided that with
respect to the Borrower, Energy Partners, SOLP and each of its
Subsidiaries shall be deemed to be a Wholly Owned Subsidiary for
so long as the Borrower has at least a 95% ownership interest
(directly or indirectly) in Energy Partners, SOLP or such
Subsidiary, as the case may be.
"Withdrawal Liability" means liability to a
Multiemployer Plan as a result of a complete or partial
withdrawal from such Multiemployer Plan, as such terms are
defined in Part I of Subtitle E of Title IV of ERISA.
<PAGE>
<PAGE> 17
SECTION 1.02. Classification of Loans and Borrowings.
For purposes of this Agreement, Loans may be classified and
referred to by Class (e.g., a "Revolving Loan") or by Type (e.g.,
a "Eurodollar Loan") or by Class and Type (e.g., a "Eurodollar
Revolving Loan"). Borrowings also may be classified and referred
to by Class (e.g., a "Revolving Borrowing") or by Type (e.g., a
"Eurodollar Borrowing") or by Class and Type (e.g., a "Eurodollar
Revolving Borrowing").
SECTION 1.03. Terms Generally. The definitions of
terms herein shall apply equally to the singular and plural forms
of the terms defined. Whenever the context may require, any
pronoun shall include the corresponding masculine, feminine and
neuter forms. The words "include", "includes" and "including"
shall be deemed to be followed by the phrase "without
limitation". The word "will" shall be construed to have the same
meaning and effect as the word "shall". Unless the context
requires otherwise (a) any definition of or reference to any
agreement, instrument or other document herein shall be construed
as referring to such agreement, instrument or other document as
from time to time amended, supplemented or otherwise modified
(subject to any restrictions on such amendments, supplements or
modifications set forth herein), (b) any reference herein to any
Person shall be construed to include such Person's successors and
assigns, (c) the words "herein", "hereof" and "hereunder", and
words of similar import, shall be construed to refer to this
Agreement in its entirety and not to any particular provision
hereof, (d) all references herein to Articles, Sections, Exhibits
and Schedules shall be construed to refer to Articles and
Sections of, and Exhibits and Schedules to, this Agreement and
(e) the words "asset" and "property" shall be construed to have
the same meaning and effect and to refer to any and all tangible
and intangible assets and properties, including cash, securities,
accounts and contract rights.
SECTION 1.04. Accounting Terms; GAAP. Except as
otherwise expressly provided herein, all terms of an accounting
or financial nature shall be construed in accordance with GAAP,
as in effect from time to time; provided that, if the Borrower
notifies the Administrative Agent that the Borrower requests an
amendment to any provision hereof to eliminate the effect of any
change occurring after the date hereof in GAAP or in the
application thereof on the operation of such provision (or if the
Administrative Agent notifies the Borrower that the Required
Lenders request an amendment to any provision hereof for such
purpose), regardless of whether any such notice is given before
or after such change in GAAP or in the application thereof, then
such provision shall be interpreted on the basis of GAAP as in
effect and applied immediately before such change shall have
become effective until such notice shall have been withdrawn or
such provision amended in accordance herewith.
ARTICLE II
The Credits
<PAGE>
<PAGE> 18
SECTION 2.01. Commitments. Subject to the terms and
conditions set forth herein, each Lender agrees to make Revolving
Loans to the Borrower from time to time during the Availability
Period in an aggregate principal amount that will not result in
(a) such Lender's Revolving Credit Exposure exceeding such
Lender's Commitment or (b) the sum of the total Revolving Credit
Exposures plus the aggregate principal amount of outstanding
Competitive Loans exceeding the total Commitments. Within the
foregoing limits and subject to the terms and conditions set
forth herein, the Borrower may borrow, prepay and reborrow
Revolving Loans.
SECTION 2.02. Loans and Borrowings. (a) Each
Revolving Loan shall be made as part of a Borrowing consisting of
Revolving Loans made by the Lenders ratably in accordance with
their respective Commitments. Each Competitive Loan shall be
made in accordance with the procedures set forth in Section 2.04.
The failure of any Lender to make any Loan required to be made by
it shall not relieve any other Lender of its obligations
hereunder; provided that the Commitments and Competitive Bids of
the Lenders are several and no Lender shall be responsible for
any other Lender's failure to make Loans as required.
(b) Subject to Section 2.14, (i) each Revolving
Borrowing shall be comprised entirely of Base Rate Loans or
Eurodollar Loans as the Borrower may request in accordance
herewith, and (ii) each Competitive Borrowing shall be comprised
entirely of Eurodollar Loans or Absolute Rate Loans as the
Borrower may request in accordance herewith. Each Lender at its
option may make any Eurodollar Loan by causing any domestic or
foreign branch or Affiliate of such Lender to make such Loan;
provided that any exercise of such option shall not affect the
obligation of the Borrower to repay such Loan in accordance with
the terms of this Agreement.
(c) At the commencement of each Interest Period for
any Eurodollar Revolving Borrowing, such Borrowing shall be in an
aggregate amount that is an integral multiple of $1,000,000 and
not less than $10,000,000. At the time that each Base Rate
Revolving Borrowing is made, such Borrowing shall be in an
aggregate amount that is an integral multiple of $1,000,000 and
not less than $10,000,000; provided that a Base Rate Revolving
Borrowing may be in an aggregate amount that is equal to the
entire unused balance of the total Commitments or that is
required to finance the reimbursement of an LC Disbursement as
contemplated by Section 2.06(e). Each Competitive Borrowing
shall be in an aggregate amount that is an integral multiple of
$1,000,000 and not less than $10,000,000. Each Swingline Loan
shall be in an amount that is an integral multiple of $100,000
and not less than $1,000,000. Borrowings of more than one Type
and Class may be outstanding at the same time; provided that
there shall not at any time be more than a total of six
Eurodollar Revolving Borrowings outstanding.
(d) Notwithstanding any other provision of this
Agreement, the Borrower shall not be entitled to request, or to
elect to convert or continue, any Borrowing if the Interest
Period requested with respect thereto would end after the
Maturity Date.
<PAGE>
<PAGE> 19
SECTION 2.03. Requests for Revolving Borrowings. To
request a Revolving Borrowing, the Borrower shall notify the
Administrative Agent of such request by telephone (a) in the case
of a Eurodollar Borrowing, not later than 11:00 a.m., Dallas
time, three Business Days before the date of the proposed
Borrowing or (b) in the case of a Base Rate Borrowing, not later
than 11:00 a.m., Dallas time, one Business Day before the date of
the proposed Borrowing; provided that any such notice of a Base
Rate Revolving Borrowing to finance the reimbursement of an LC
Disbursement as contemplated by Section 2.06(e) may be given not
later than 10:00 a.m., Dallas time, on the date of the proposed
Borrowing. Each such telephonic Borrowing Request shall be
irrevocable and shall be confirmed promptly by hand delivery or
telecopy to the Administrative Agent of a written Borrowing
Request in a form approved by the Administrative Agent and signed
by the Borrower. Each such telephonic and written Borrowing
Request shall specify the following information in compliance
with Section 2.02:
(i) the aggregate amount of the requested
Borrowing;
(ii) the date of such Borrowing, which shall be a
Business Day;
(iii) whether such Borrowing is to be a Base Rate
Borrowing or a Eurodollar Borrowing;
(iv) in the case of a Eurodollar Borrowing, the
initial Interest Period to be applicable thereto, which
shall be a period contemplated by the definition of the term
"Interest Period"; and
(v) the location and number of the Borrower's
account to which funds are to be disbursed, which shall
comply with the requirements of Section 2.07.
If no election as to the Type of Revolving Borrowing is
specified, then the requested Revolving Borrowing shall be a Base
Rate Borrowing. If no Interest Period is specified with respect
to any requested Eurodollar Revolving Borrowing, then the
Borrower shall be deemed to have selected an Interest Period of
one month's duration. Promptly following receipt of a Borrowing
Request in accordance with this Section, the Administrative Agent
shall advise each Lender of the details thereof and of the amount
of such Lender's Loan to be made as part of the requested
Borrowing.
SECTION 2.04. Competitive Bid Procedure. (a) Subject
to the terms and conditions set forth herein, from time to time
during the Availability Period the Borrower may request
Competitive Bids and may (but shall not have any obligation to)
accept Competitive Bids and borrow Competitive Loans; provided
that the sum of the total Revolving Credit Exposures plus the
aggregate principal amount of outstanding Competitive Loans at
any time shall not exceed the total Commitments. To request
Competitive Bids, the Borrower shall notify the Administrative
Agent of such request by telephone, in the case of a Eurodollar
Borrowing, not later than 11:00 a.m.,
<PAGE>
<PAGE> 20
Dallas time, four Business Days before the date of the proposed
Borrowing and, in the case of a Absolute Rate Borrowing, not
later than 10:00 a.m., Dallas time, one Business Day before the
date of the proposed Borrowing; provided that the Borrower may
submit up to (but not more than) three Competitive Bid Requests
on the same day. Each such telephonic Competitive Bid Request
shall be confirmed promptly by hand delivery or telecopy to the
Administrative Agent of a written Competitive Bid Request in a
form approved by the Administrative Agent and signed by the
Borrower. Each such telephonic and written Competitive Bid
Request shall specify the following information in compliance
with Section 2.02:
(i) the aggregate amount of the requested
Borrowing;
(ii) the date of such Borrowing, which shall be a
Business Day;
(iii) whether such Borrowing is to be a Eurodollar
Borrowing or a Absolute Rate Borrowing;
(iv) the Interest Period to be applicable to such
Borrowing, which shall be a period contemplated by the
definition of the term "Interest Period"; and
(v) the location and number of the Borrower's
account to which funds are to be disbursed, which shall
comply with the requirements of Section 2.07.
Promptly following receipt of a Competitive Bid Request in
accordance with this Section, the Administrative Agent shall
notify the Lenders of the details thereof by telecopy, inviting
the Lenders to submit Competitive Bids.
(b) Each Lender may (but shall not have any obligation
to) make one or more Competitive Bids to the Borrower in response
to a Competitive Bid Request. Each Competitive Bid by a Lender
must be in a form approved by the Administrative Agent and must
be received by the Administrative Agent by telecopy, in the case
of a Eurodollar Competitive Borrowing, not later than 9:30 a.m.,
Dallas time, three Business Days before the proposed date of such
Competitive Borrowing, and in the case of a Absolute Rate
Borrowing, not later than 9:30 a.m., Dallas time, on the proposed
date of such Competitive Borrowing. Competitive Bids that do not
conform substantially to the form approved by the Administrative
Agent may be rejected by the Administrative Agent, and the
Administrative Agent shall notify the applicable Lender as
promptly as practicable. Each Competitive Bid shall specify
(i) the principal amount (which shall be a minimum of $10,000,000
and an integral multiple of $1,000,000 and which may equal the
entire principal amount of the Competitive Borrowing requested by
the Borrower) of the Competitive Loan or Loans that the Lender is
willing to make, (ii) the Competitive Bid Rate or Rates at which
the Lender is prepared to make such Loan or Loans (expressed as
<PAGE>
<PAGE> 21
a percentage rate per annum in the form of a decimal to no more
than four decimal places) and (iii) the Interest Period
applicable to each such Loan and the last day thereof.
(c) The Administrative Agent shall promptly notify the
Borrower by telecopy of the Competitive Bid Rate and the
principal amount specified in each Competitive Bid and the
identity of the Lender that shall have made such Competitive Bid.
(d) Subject only to the provisions of this paragraph,
the Borrower may accept or reject any Competitive Bid. The
Borrower shall notify the Administrative Agent by telephone,
confirmed by telecopy in a form approved by the Administrative
Agent, whether and to what extent it has decided to accept or
reject each Competitive Bid, in the case of a Eurodollar
Competitive Borrowing, not later than 10:30 a.m., Dallas time,
three Business Days before the date of the proposed Competitive
Borrowing, and in the case of a Absolute Rate Borrowing, not
later than 10:30 a.m., Dallas time, on the proposed date of the
Competitive Borrowing; provided that (i) the failure of the
Borrower to give such notice shall be deemed to be a rejection of
each Competitive Bid, (ii) the Borrower shall not accept a
Competitive Bid made at a particular Competitive Bid Rate if the
Borrower rejects a Competitive Bid made at a lower Competitive
Bid Rate, (iii) the aggregate amount of the Competitive Bids
accepted by the Borrower shall not exceed the aggregate amount of
the requested Competitive Borrowing specified in the related
Competitive Bid Request, (iv) to the extent necessary to comply
with clause (iii) above, the Borrower may accept Competitive Bids
at the same Competitive Bid Rate in part, which acceptance, in
the case of multiple Competitive Bids at such Competitive Bid
Rate, shall be made pro rata in accordance with the amount of
each such Competitive Bid, and (v) except pursuant to clause (iv)
above, no Competitive Bid shall be accepted for a Competitive
Loan unless such Competitive Loan is in a minimum principal
amount of $10,000,000 and an integral multiple of $1,000,000;
provided further that if a Competitive Loan must be in an amount
less than $10,000,000 because of the provisions of clause (iv)
above, such Competitive Loan may be for a minimum of $1,000,000
or any integral multiple thereof, and in calculating the pro rata
allocation of acceptances of portions of multiple Competitive
Bids at a particular Competitive Bid Rate pursuant to clause (iv)
the amounts shall be rounded to integral multiples of $1,000,000
in a manner determined by the Borrower. A notice given by the
Borrower pursuant to this paragraph shall be irrevocable.
(e) The Administrative Agent shall promptly notify
each bidding Lender by telecopy whether or not its Competitive
Bid has been accepted (and, if so, the amount and Competitive Bid
Rate so accepted), and each successful bidder will thereupon
become bound, subject to the terms and conditions hereof, to make
the Competitive Loan in respect of which its Competitive Bid has
been accepted.
(f) If the Administrative Agent shall elect to submit
a Competitive Bid in its capacity as a Lender, it shall submit
such Competitive Bid directly to the Borrower at least one
quarter of an hour earlier than the
<PAGE>
<PAGE> 22
time by which the other Lenders are required to submit their
Competitive Bids to the Administrative Agent pursuant to
paragraph (b) of this Section.
SECTION 2.05. Swingline Loans. (a) Subject to the
terms and conditions set forth herein, the Swingline Lender
agrees to make Swingline Loans to the Borrower from time to time
during the Availability Period, in a minimum principal amount of
$1,000,000 and in an aggregate principal amount at any time
outstanding that will not result in (i) the aggregate principal
amount of outstanding Swingline Loans exceeding $50,000,000 or
(ii) the sum of the total Revolving Credit Exposures plus the
aggregate principal amount of outstanding Competitive Loans
exceeding the total Commitments; provided that the Swingline
Lender shall not be required to make a Swingline Loan to
refinance an outstanding Swingline Loan. Within the foregoing
limits and subject to the terms and conditions set forth herein,
the Borrower may borrow, prepay and reborrow Swingline Loans.
(b) To request a Swingline Loan, the Borrower shall
notify the Administrative Agent of such request by telephone
(confirmed by telecopy), not later than 12:00 noon, Dallas time,
on the day of a proposed Swingline Loan. Each such notice shall
be irrevocable and shall specify the requested date (which shall
be a Business Day) and amount of the requested Swingline Loan.
The Administrative Agent will promptly advise the Swingline
Lender of any such notice received from the Borrower. The
Swingline Lender shall make each Swingline Loan available to the
Borrower by means of a credit to the general deposit account of
the Borrower with the Swingline Lender (or, in the case of a
Swingline Loan made to finance the reimbursement of an LC
Disbursement as provided in Section 2.06(e), by remittance to the
Issuing Bank) by 3:00 p.m., Dallas time, on the requested date of
such Swingline Loan.
(c) The Swingline Lender may by written notice given
to the Administrative Agent not later than 10:00 a.m., Dallas
time, on any Business Day require the Lenders to acquire
participations on such Business Day in all or a portion of the
Swingline Loans outstanding. Such notice shall specify the
aggregate amount of Swingline Loans in which Lenders will
participate. Promptly upon receipt of such notice, the
Administrative Agent will give notice thereof to each Lender,
specifying in such notice such Lender's Applicable Percentage of
such Swingline Loan or Loans. Each Lender hereby absolutely and
unconditionally agrees, upon receipt of notice as provided above,
to pay to the Administrative Agent, for the account of the
Swingline Lender, such Lender's Applicable Percentage of such
Swingline Loan or Loans. Each Lender acknowledges and agrees
that its obligation to acquire participations in Swingline Loans
pursuant to this paragraph is absolute and unconditional and
shall not be affected by any circumstance whatsoever, including
the occurrence and continuance of a Default or reduction or
termination of the Commitments, and that each such payment shall
be made without any offset, abatement, withholding or reduction
whatsoever. Each Lender shall comply with its obligation under
this paragraph by wire transfer of immediately available funds,
in the same manner as provided in Section 2.07 with respect to
Loans made by such Lender (and Section 2.07 shall apply,
<PAGE>
<PAGE> 23
mutatis mutandis, to the payment obligations of the Lenders), and
the Administrative Agent shall promptly pay to the Swingline
Lender the amounts so received by it from the Lenders. The
Administrative Agent shall notify the Borrower of any
participations in any Swingline Loan acquired pursuant to this
paragraph, and thereafter payments in respect of such Swingline
Loan shall be made to the Administrative Agent and not to the
Swingline Lender. Any amounts received by the Swingline Lender
from the Borrower (or other party on behalf of the Borrower) in
respect of a Swingline Loan after receipt by the Swingline Lender
of the proceeds of a sale of participations therein shall be
promptly remitted to the Administrative Agent; any such amounts
received by the Administrative Agent shall be promptly remitted
by the Administrative Agent to the Lenders that shall have made
their payments pursuant to this paragraph and to the Swingline
Lender, as their interests may appear. The purchase of
participations in a Swingline Loan pursuant to this paragraph
shall not relieve the Borrower of any default in the payment
thereof.
SECTION 2.06. Letters of Credit. (a) General.
Subject to the terms and conditions set forth herein, the
Borrower may request the issuance of Letters of Credit
denominated in Dollars or in Alternate Currency in a minimum
amount of $100,000 or the Dollar Equivalent thereof for its own
account, in a form reasonably acceptable to the Administrative
Agent and the Issuing Bank, at any time and from time to time
during the Availability Period. In the event of any
inconsistency between the terms and conditions of this Agreement
and the terms and conditions of any form of letter of credit
application or other agreement submitted by the Borrower to, or
entered into by the Borrower with, the Issuing Bank relating to
any Letter of Credit, the terms and conditions of this Agreement
shall control.
(b) Notice of Issuance, Amendment, Renewal, Extension;
Certain Conditions. To request the issuance of a Letter of
Credit (or the amendment, renewal or extension of an outstanding
Letter of Credit), the Borrower shall hand deliver or telecopy
(or transmit by electronic communication, if arrangements for
doing so have been approved by the Issuing Bank) to the Issuing
Bank and the Administrative Agent (at least three Business Days
in advance of the requested date of issuance, amendment, renewal
or extension) a notice requesting the issuance of a Letter of
Credit, or identifying the Letter of Credit to be amended,
renewed or extended, the date of issuance, amendment, renewal or
extension, the date on which such Letter of Credit is to expire
(which shall comply with paragraph (c) of this Section), the
amount of such Letter of Credit, the name and address of the
beneficiary thereof and such other information as shall be
necessary to prepare, amend, renew or extend such Letter of
Credit. If requested by the Issuing Bank, the Borrower also
shall submit a letter of credit application on the Issuing Bank's
standard form in connection with any request for a Letter of
Credit. A Letter of Credit shall be issued, amended, renewed or
extended only if (and upon issuance, amendment, renewal or
extension of each Letter of Credit the Borrower shall be deemed
to represent and warrant that), after giving effect to such
issuance, amendment, renewal or extension (i) the LC Exposure
shall not exceed $200,000,000 (or the Dollar Equivalent thereof)
and (ii) the sum of
<PAGE>
<PAGE> 24
the total Revolving Credit Exposures plus the aggregate principal
amount of outstanding Competitive Loans shall not exceed the
total Commitments.
(c) Expiration Date. Each Letter of Credit shall
expire at or prior to the close of business on the earlier of
(i) the date one year after the date of the issuance of such
Letter of Credit (or, in the case of any renewal or extension
thereof, one year after such renewal or extension) and (ii) the
date that is five Business Days prior to the Maturity Date.
(d) Participations. By the issuance of a Letter of
Credit (or an amendment to a Letter of Credit increasing the
amount thereof) and without any further action on the part of the
Issuing Bank or the Lenders, the Issuing Bank hereby grants to
each Lender, and each Lender hereby acquires from the Issuing
Bank, a participation in such Letter of Credit equal to such
Lender's Applicable Percentage of the aggregate amount available
to be drawn under such Letter of Credit. In consideration and in
furtherance of the foregoing, each Lender hereby absolutely and
unconditionally agrees to pay to the Administrative Agent, for
the account of the Issuing Bank, such Lender's Applicable
Percentage of each LC Disbursement made by the Issuing Bank and
not reimbursed by the Borrower on the date due as provided in
paragraph (e) of this Section, or of any reimbursement payment
required to be refunded to the Borrower for any reason. Each
Lender acknowledges and agrees that its obligation to acquire
participations pursuant to this paragraph in respect of Letters
of Credit is absolute and unconditional and shall not be affected
by any circumstance whatsoever, including any amendment, renewal
or extension of any Letter of Credit or the occurrence and
continuance of a Default or reduction or termination of the
Commitments, and that each such payment shall be made without any
offset, abatement, withholding or reduction whatsoever.
(e) Reimbursement. If the Issuing Bank shall make any
LC Disbursement in respect of a Letter of Credit, the Borrower
shall reimburse such LC Disbursement by paying to the
Administrative Agent an amount equal to such LC Disbursement not
later than 12:00 noon, Dallas time, on the date that such LC
Disbursement is made, if the Borrower shall have received notice
of such LC Disbursement prior to 10:00 a.m., Dallas time, on such
date, or, if such notice has not been received by the Borrower
prior to such time on such date, then not later than 12:00 noon,
Dallas time, on (i) the Business Day that the Borrower receives
such notice, if such notice is received prior to 10:00 a.m.,
Dallas time, on the day of receipt, or (ii) the Business Day
immediately following the day that the Borrower receives such
notice, if such notice is not received prior to such time on the
day of receipt; provided that the Borrower may, subject to the
conditions to borrowing set forth herein, request in accordance
with Section 2.03 or 2.05 that such payment be financed with a
Base Rate Revolving Borrowing or Swingline Loan in an equivalent
amount and, to the extent so financed, the Borrower's obligation
to make such payment shall be discharged and replaced by the
resulting Base Rate Revolving Borrowing or Swingline Loan. If
the Borrower fails to make such payment when due, the
Administrative Agent shall notify each Lender of the applicable
LC
<PAGE>
<PAGE> 25
Disbursement, the payment then due from the Borrower in respect
thereof and such Lender's Applicable Percentage thereof.
Promptly following receipt of such notice, each Lender shall pay
to the Administrative Agent its Applicable Percentage of the
payment then due from the Borrower, in the same manner as
provided in Section 2.07 with respect to Loans made by such
Lender (and Section 2.07 shall apply, mutatis mutandis, to the
payment obligations of the Lenders), and the Administrative Agent
shall promptly pay to the Issuing Bank the amounts so received by
it from the Lenders. Promptly following receipt by the
Administrative Agent of any payment from the Borrower pursuant to
this paragraph, the Administrative Agent shall distribute such
payment to the Issuing Bank or, to the extent that Lenders have
made payments pursuant to this paragraph to reimburse the Issuing
Bank, then to such Lenders and the Issuing Bank as their
interests may appear. Any payment made by a Lender pursuant to
this paragraph to reimburse the Issuing Bank for any LC
Disbursement (other than the funding of Base Rate Revolving Loans
or a Swingline Loan as contemplated above) shall not constitute a
Loan and shall not relieve the Borrower of its obligation to
reimburse such LC Disbursement.
(f) Obligations Absolute. The Borrower's obligation
to reimburse LC Disbursements as provided in paragraph (e) of
this Section shall be absolute, unconditional and irrevocable,
and shall be performed strictly in accordance with the terms of
this Agreement under any and all circumstances whatsoever and
irrespective of:
(i) any lack of validity or enforceability of any
Letter of Credit or this Agreement, or any term or provision
therein;
(ii) any amendment or waiver of or any consent to
departure from all or any of the provisions of any Letter of
Credit or this Agreement;
(iii) the existence of any claim, setoff, defense
or other right that the Borrower, any other party
guaranteeing, or otherwise obligated with, the Borrower, any
Subsidiary or other Affiliate thereof or any other Person
may at any time have against the beneficiary under any
Letter of Credit, the Issuing Bank, the Administrative Agent
or any Lender or any other Person, whether in connection
with this Agreement or any other related or unrelated
agreement or transaction;
(iv) any draft or other document presented under a
Letter of Credit proving to be forged, fraudulent or invalid
in any respect or any statement therein being untrue or
inaccurate in any respect;
(v) payment by the Issuing Bank under a Letter of
Credit against presentation of a draft or other document
that does not comply with the terms of such Letter of
Credit; and
<PAGE>
<PAGE> 26
(vi) any other act or omission to act or delay of
any kind of the Issuing Bank, the Lenders, the
Administrative Agent or any other Person or any other event
or circumstance whatsoever, whether or not similar to any of
the foregoing, that might, but for the provisions of this
Section, constitute a legal or equitable discharge of the
Borrower's obligations hereunder.
Neither the Administrative Agent, the Lenders nor the Issuing
Bank, nor any of their Related Parties, shall have any liability
or responsibility by reason of or in connection with the issuance
or transfer of any Letter of Credit or any payment or failure to
make any payment thereunder, including any of the circumstances
specified in clauses (i) through (vi) above, as well as any
error, omission, interruption, loss or delay in transmission or
delivery of any draft, notice or other communication under or
relating to any Letter of Credit (including any document required
to make a drawing thereunder), any error in interpretation of
technical terms or any consequence arising from causes beyond the
control of the Issuing Bank; provided that the foregoing shall
not be construed to excuse the Issuing Bank from liability to the
Borrower to the extent of any direct damages (as opposed to
consequential damages, claims in respect of which are hereby
waived by the Borrower to the extent permitted by applicable law)
suffered by the Borrower that are caused by the Issuing Bank's
failure to exercise the agreed standard of care (as set forth
below) in determining whether drafts and other documents
presented under a Letter of Credit comply with the terms thereof.
The parties hereto expressly agree that the Issuing Bank shall
have exercised the agreed standard of care in the absence of
gross negligence or wilful misconduct on the part of the Issuing
Bank. Without limiting the generality of the foregoing, it is
understood that the Issuing Bank may accept documents that appear
on their face to be in substantial compliance with the terms of a
Letter of Credit, without responsibility for further
investigation, regardless of any notice or information to the
contrary, and may make payment upon presentation of documents
that appear on their face to be in substantial compliance with
the terms of such Letter of Credit; provided that the Issuing
Bank shall have the right, in its sole discretion, to decline to
accept such documents and to make such payment if such documents
are not in strict compliance with the terms of such Letter of
Credit.
(g) Disbursement Procedures. The Issuing Bank shall,
promptly following its receipt thereof, examine all documents
purporting to represent a demand for payment under a Letter of
Credit. The Issuing Bank shall promptly notify the
Administrative Agent and the Borrower by telephone (confirmed by
telecopy) of such demand for payment and whether the Issuing Bank
has made or will make an LC Disbursement thereunder; provided
that any failure to give or delay in giving such notice shall not
relieve the Borrower of its obligation to reimburse the Issuing
Bank and the Lenders with respect to any such LC Disbursement.
(h) Interim Interest. If the Issuing Bank shall make
any LC Disbursement, then, unless the Borrower shall reimburse
such LC Disbursement in full on the date such LC Disbursement is
made, the unpaid amount thereof shall bear interest, for each day
from and including the date such LC Disbursement is made to but
excluding the date that the Borrower reimburses
<PAGE>
<PAGE> 27
such LC Disbursement, at the rate per annum then applicable to
Base Rate Revolving Loans; provided that, if the Borrower fails
to reimburse such LC Disbursement when due pursuant to
paragraph (e) of this Section, then Section 2.13(e) shall apply.
Interest accrued pursuant to this paragraph shall be for the
account of the Issuing Bank, except that interest accrued on and
after the date of payment by any Lender pursuant to paragraph (e)
of this Section to reimburse the Issuing Bank shall be for the
account of such Lender to the extent of such payment.
(i) Replacement of the Issuing Bank. The Issuing Bank
may be replaced at any time by written agreement among the
Borrower, the Administrative Agent, the replaced Issuing Bank and
the successor Issuing Bank. The Administrative Agent shall
notify the Lenders of any such replacement of the Issuing Bank.
At the time any such replacement shall become effective, the
Borrower shall pay all unpaid fees accrued for the account of the
replaced Issuing Bank pursuant to Section 2.12(b). From and
after the effective date of any such replacement, (i) the
successor Issuing Bank shall have all the rights and obligations
of the Issuing Bank under this Agreement with respect to Letters
of Credit to be issued thereafter and (ii) references herein to
the term "Issuing Bank" shall be deemed to refer to such
successor or to any previous Issuing Bank, or to such successor
and all previous Issuing Banks, as the context shall require.
After the replacement of an Issuing Bank hereunder, the replaced
Issuing Bank shall remain a party hereto and shall continue to
have all the rights and obligations of an Issuing Bank under this
Agreement with respect to Letters of Credit issued by it prior to
such replacement, but shall not be required to issue additional
Letters of Credit.
(j) Cash Collateralization. If any Event of Default
shall occur and be continuing, on the Business Day that the
Borrower receives notice from the Administrative Agent or the
Required Lenders (or, if the maturity of the Loans has been
accelerated, Lenders with LC Exposure representing at least a
majority of the total LC Exposure) demanding the deposit of cash
collateral pursuant to this paragraph, the Borrower shall deposit
in an account with the Administrative Agent, in the name of the
Administrative Agent and for the benefit of the Lenders, an
amount in cash equal to the LC Exposure as of such date plus any
accrued and unpaid interest thereon; provided that the obligation
to deposit such cash collateral shall become effective
immediately, and such deposit shall become immediately due and
payable, without demand or other notice of any kind, upon the
occurrence of any Event of Default with respect to the Borrower
described in clause (g) or (h) of Article VII. Such deposit
shall be held by the Administrative Agent as collateral for the
payment and performance of the obligations of the Borrower under
this Agreement. The Administrative Agent shall have exclusive
dominion and control, including the exclusive right of
withdrawal, over such account. Other than any interest earned on
the investment of such deposits, which investments shall be made
at the option and sole discretion of the Administrative Agent and
at the Borrower's risk and expense, such deposits shall not bear
interest. Interest or profits, if any, on such investments shall
accumulate in such account. Moneys in such account shall be
applied by
<PAGE>
<PAGE> 28
the Administrative Agent to reimburse the Issuing Bank for LC
Disbursements for which it has not been reimbursed and, to the
extent not so applied, shall be held for the satisfaction of the
reimbursement obligations of the Borrower for the LC Exposure at
such time or, if the maturity of the Loans has been accelerated
(but subject to the consent of Lenders with LC Exposure
representing at least a majority of the total LC Exposure), be
applied to satisfy other obligations of the Borrower under this
Agreement. If the Borrower is required to provide an amount of
cash collateral hereunder as a result of the occurrence of an
Event of Default, such amount (to the extent not applied as
aforesaid) shall be returned to the Borrower within three
Business Days after all Events of Default have been cured or
waived.
(k) Alternate Currency. In the event that a Letter of
Credit denominated in the Alternate Currency (an "Alternate
Currency Letter of Credit") is issued pursuant to this Section
2.06, the following provisions shall apply so long as such
Alternate Currency Letter of Credit or any LC Exposure in respect
thereof is outstanding:
(i) Such Alternate Currency Letter of Credit shall
be a Letter of Credit for all purposes of this Agreement.
(ii) For purposes of determining Revolving Credit
Exposure, the amount of LC Exposures in respect of Alternate
Currency Letters of Credit shall be, as of any date of
determination, the Dollar Equivalent of the Alternate
Currency amount of such LC Exposures.
(iii) For purposes of determining participation fees
and fronting fees payable under Section 2.12, the LC
Exposure to be drawn under an Alternate Currency Letter of
Credit shall be the Dollar Equivalent of the Alternate
Currency amount available to be drawn under such Alternate
Currency Letter of Credit as of the first day of each month
(or, if later during such month, the date on which such
Alternate Currency Letter of Credit is issued) during the
period in respect of which such fees are payable.
(iv) The obligation of each Lender to pay its
Applicable Percentage of each LC Disbursement made by the
Issuing Bank in respect of an unreimbursed drawing under an
Alternate Currency Letter of Credit pursuant to Section
2.06(d) shall be to pay to the Issuing Bank an amount equal
to such Lender's Applicable Percentage of the Dollar
Equivalent (as determined pursuant to paragraph (vi) below)
of such unreimbursed drawing.
(v) The obligation of the Borrower to reimburse LC
Disbursements made by the Issuing Bank pursuant to Section
2.06(e) in respect of a drawing made under an Alternate Currency
Letter of Credit shall be to reimburse the Issuing Bank in
Dollars in an amount equal to the Dollar Equivalent on the date
of such drawing of the Alternate Currency amounts to be
reimbursed in respect of such drawing; interest payable under
Section 2.06(h) shall be payable in Dollars on the Dollar
Equivalent of any and all amounts
<PAGE>
<PAGE> 29
remaining unpaid by the Borrower in respect of LC
Disbursements paid under an Alternate Currency Letter of
Credit; and any Loan requested or deemed requested to be
made pursuant to Section 2.06(e) shall be in an amount equal
to the Dollar Equivalent (as determined pursuant to the
first clause of this paragraph) of the Alternate Currency
amount of the drawing in respect of which such Loan is so
requested.
(vi) In addition to its obligations under
Section 5.01, the Borrower shall from time to time, upon
request of the Administrative Agent, deliver to the
Administrative Agent a calculation in reasonable detail
showing the amount of the unused Commitments, utilizing in
such calculation the Dollar Equivalent of the LC Exposures
in respect of Alternate Currency Letters of Credit.
SECTION 2.07. Funding of Borrowings. (a) Each Lender
shall make each Loan to be made by it hereunder on the proposed
date thereof by wire transfer of immediately available funds by
12:00 noon, Dallas time, to the account of the Administrative
Agent most recently designated by it for such purpose by notice
to the Lenders; provided that Swingline Loans shall be made as
provided in Section 2.05. The Administrative Agent will make
such Loans available to the Borrower by promptly crediting the
amounts so received, in like funds, to an account of the Borrower
and designated by the Borrower in the applicable Borrowing
Request or Competitive Bid Request; provided that Base Rate
Revolving Loans made to finance the reimbursement of an LC
Disbursement as provided in Section 2.06(e) shall be remitted by
the Administrative Agent to the Issuing Bank.
(b) Unless the Administrative Agent shall have
received notice from a Lender prior to the proposed date of any
Borrowing that such Lender will not make available to the
Administrative Agent such Lender's share of such Borrowing, the
Administrative Agent may assume that such Lender has made such
share available on such date in accordance with paragraph (a) of
this Section and may, in reliance upon such assumption, make
available to the Borrower a corresponding amount. In such event,
if a Lender has not in fact made its share of the applicable
Borrowing available to the Administrative Agent, then the
applicable Lender and the Borrower severally agree to pay to the
Administrative Agent forthwith on demand such corresponding
amount with interest thereon, for each day from and including the
date such amount is made available to the Borrower to but
excluding the date of payment to the Administrative Agent, at (i)
in the case of such Lender, the Federal Funds Rate or (ii) in the
case of the Borrower, the interest rate applicable to Base Rate
Loans. If such Lender pays such amount to the Administrative
Agent, then such amount shall constitute such Lender's Loan
included in such Borrowing.
SECTION 2.08. Interest Elections. (a) Each Revolving
Borrowing initially shall be of the Type specified in the
applicable Borrowing Request and, in the case of a Eurodollar
Revolving Borrowing, shall have an initial Interest Period as
specified in such Borrowing Request. Thereafter, the
<PAGE>
<PAGE> 30
Borrower may elect to convert such Borrowing to a different Type
or to continue such Borrowing and, in the case of a Eurodollar
Revolving Borrowing, may elect Interest Periods therefor, all as
provided in this Section. The Borrower may elect different
options with respect to different portions of the affected
Borrowing, in which case each such portion shall be allocated
ratably among the Lenders holding the Loans comprising such
Borrowing, and the Loans comprising each such portion shall be
considered a separate Borrowing. This Section shall not apply to
Competitive Borrowings or Swingline Borrowings, which may not be
converted or continued.
(b) To make an election pursuant to this Section, the
Borrower shall notify the Administrative Agent of such election
by telephone by the time that a Borrowing Request would be
required under Section 2.03 if the Borrower were requesting a
Revolving Borrowing of the Type resulting from such election to
be made on the effective date of such election. Each such
telephonic Interest Election Request shall be irrevocable and
shall be confirmed promptly by hand delivery or telecopy to the
Administrative Agent of a written Interest Election Request in a
form approved by the Administrative Agent and signed by the
Borrower.
(c) Each telephonic and written Interest Election
Request shall specify the following information in compliance
with Section 2.02:
(i) the Borrowing to which such Interest Election
Request applies and, if different options are being elected
with respect to different portions thereof, the portions
thereof to be allocated to each resulting Borrowing (in
which case the information to be specified pursuant to
clauses (iii) and (iv) below shall be specified for each
resulting Borrowing);
(ii) the effective date of the election made
pursuant to such Interest Election Request, which shall be a
Business Day;
(iii) whether the resulting Borrowing is to be a
Base Rate Borrowing or a Eurodollar Borrowing; and
(iv) if the resulting Borrowing is a Eurodollar
Borrowing, the Interest Period to be applicable thereto
after giving effect to such election, which shall be a
period contemplated by the definition of the term "Interest
Period".
If any such Interest Election Request requests a Eurodollar
Borrowing but does not specify an Interest Period, then the
Borrower shall be deemed to have selected an Interest Period of
one month's duration.
(d) Promptly following receipt of an Interest Election
Request, the Administrative Agent shall advise each Lender of the
details thereof and of such Lender's portion of each resulting
Borrowing.
<PAGE>
<PAGE> 31
(e) If the Borrower fails to deliver a timely Interest
Election Request with respect to a Eurodollar Revolving Borrowing
prior to the end of the Interest Period applicable thereto, then,
unless such Borrowing is repaid as provided herein, at the end of
such Interest Period such Borrowing shall be converted to a Base
Rate Borrowing. Notwithstanding any contrary provision hereof,
if an Event of Default has occurred and is continuing and the
Administrative Agent, at the request of the Required Lenders, so
notifies the Borrower, then, so long as an Event of Default is
continuing (i) no outstanding Revolving Borrowing may be
converted to or continued as a Eurodollar Borrowing and (ii)
unless repaid, each Eurodollar Revolving Borrowing shall be
converted to a Base Rate Borrowing at the end of the Interest
Period applicable thereto.
SECTION 2.09. Termination and Reduction of
Commitments. (a) Unless previously terminated, the Commitments
shall terminate on the Maturity Date.
(b) The Borrower may at any time terminate, or from
time to time reduce, the Commitments; provided that (i) each
reduction of the Commitments shall be in an amount that is an
integral multiple of $5,000,000 and (ii) the Borrower shall not
terminate or reduce the Commitments if, after giving effect to
any concurrent prepayment of the Loans in accordance with Section
2.11, the sum of the Revolving Credit Exposures plus the
aggregate principal amount of outstanding Competitive Loans would
exceed the total Commitments.
(c) The Borrower shall notify the Administrative Agent
of any election to terminate or reduce the Commitments under
paragraph (b) of this Section at least three Business Days prior
to the effective date of such termination or reduction,
specifying such election and the effective date thereof.
Promptly following receipt of any notice, the Administrative
Agent shall advise the Lenders of the contents thereof. Each
notice delivered by the Borrower pursuant to this Section shall
be irrevocable; provided that a notice of termination of the
Commitments delivered by the Borrower may state that such notice
is conditioned upon the effectiveness of other credit facilities,
in which case such notice may be revoked by the Borrower (by
notice to the Administrative Agent on or prior to the specified
effective date) if such condition is not satisfied. Any
termination or reduction of the Commitments shall be permanent.
Each reduction of the Commitments shall be made ratably among the
Lenders in accordance with their respective Commitments.
SECTION 2.10. Repayment of Loans; Evidence of Debt.
(a) The Borrower hereby unconditionally promises to pay (i) to
the Administrative Agent for the account of each Lender the then
unpaid principal amount of each Revolving Loan on the Maturity
Date, (ii) to the Administrative Agent for the account of each
Lender making a Competitive Loan the then unpaid principal amount
of each Competitive Loan on the last day of the Interest Period
applicable to such Loan and (iii) to the Swingline Lender the
then unpaid principal amount of each Swingline Loan on the
earlier of the Maturity Date and the seventh day after such
Swingline Loan is made; provided that on each date that a
Revolving Borrowing or Competitive Borrowing is made, the
Borrower
<PAGE>
<PAGE> 32
shall repay all Swingline Loans that were outstanding on the date
such Revolving Loan or Competitive Loan was requested.
(b) Each Lender shall maintain in accordance with its
usual practice an account or accounts evidencing the indebtedness
of the Borrower to such Lender resulting from each Loan made by
such Lender, including the amounts of principal and interest
payable and paid to such Lender from time to time hereunder.
(c) The Administrative Agent shall maintain accounts
in which it shall record (i) the amount of each Loan made
hereunder, the Class and Type thereof and the 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) the amount of any sum received by
the Administrative Agent hereunder for the account of the Lenders
and each Lender's share thereof.
(d) The entries made in the accounts maintained
pursuant to paragraph (b) or (c) of this Section shall be prima
facie evidence of the existence and amounts of the obligations
recorded therein; provided that the failure of any Lender or the
Administrative Agent to maintain such accounts or any error
therein shall not in any manner affect the obligation of the
Borrower to repay the Loans in accordance with the terms of this
Agreement.
(e) Any Lender may request that Loans made by it be
evidenced by a promissory note. In such event, the Borrower
shall prepare, execute and deliver to such Lender a promissory
note payable to the order of such Lender (or, if requested by
such Lender, to such Lender and its registered assigns) and in a
form approved by the Administrative Agent. Thereafter, the Loans
evidenced by such promissory note and interest thereon shall at
all times (including after assignment pursuant to Section 9.04)
be represented by one or more promissory notes in such form
payable to the order of the payee named therein (or, if such
promissory note is a registered note, to such payee and its
registered assigns).
SECTION 2.11. Prepayment of Loans. (a) The Borrower
shall have the right at any time and from time to time to prepay
any Borrowing in whole or in part, subject to prior notice in
accordance with paragraph (b) of this Section; provided that the
Borrower shall not have the right to prepay any Competitive Loan
without the prior consent of the Lender thereof.
(b) The Borrower shall notify the Administrative
Agent (and, in the case of prepayment of a Swingline Loan, the
Swingline Lender) by telephone (confirmed by telecopy) of any
prepayment hereunder (i) in the case of prepayment of a
Eurodollar Revolving Borrowing, not later than 11:00 a.m., Dallas
time, three Business Days before the date of prepayment, (ii) in
the case of prepayment of a Base Rate Revolving Borrowing, not
later than 11:00 a.m., Dallas time, one Business Day before the
date of prepayment or (iii) in the case of prepayment of a
Swingline Loan, not later than 12:00 noon, Dallas time, on the
date of prepayment. Each such notice shall be irrevocable and
<PAGE>
<PAGE> 33
shall specify the prepayment date and the principal amount of
each Borrowing or portion thereof to be prepaid; provided that,
if a notice of prepayment is given in connection with a
conditional notice of termination of the Commitments as
contemplated by Section 2.09, then such notice of prepayment may
be revoked if such notice of termination is revoked in accordance
with Section 2.09. Promptly following receipt of any such notice
relating to a Revolving Borrowing, the Administrative Agent shall
advise the Lenders of the contents thereof. Each partial
prepayment of any Revolving Borrowing shall be in an amount that
would be permitted in the case of an advance of a Revolving
Borrowing of the same Type as provided in Section 2.02. Each
prepayment of a Revolving Borrowing shall be applied ratably to
the Loans included in the prepaid Borrowing. Prepayments shall
be accompanied by accrued interest to the extent required by
Section 2.13.
SECTION 2.12. Fees. (a) The Borrower agrees to pay
to the Administrative Agent for the account of each Lender a
commitment fee, which shall accrue at the Applicable Rate on the
daily amount of the unused Commitment of such Lender during the
period from and including the Effective Date to but excluding the
date on which such Commitment terminates, provided that for
purposes of calculating a Lender's unused Commitment under this
subsection 2.12(a), such Lender's Swingline Exposure shall be
zero. Accrued commitment fees shall be payable in arrears on the
last day of March, June, September and December of each year and
on the date on which the Commitments terminate, commencing on the
first such date to occur after the date hereof. All commitment
fees shall be computed on the basis of a year of 360 days and
shall be payable for the actual number of days elapsed (including
the first day but excluding the last day).
(b) The Borrower agrees to pay (i) to the
Administrative Agent for the account of each Lender a
participation fee with respect to its participations in Letters
of Credit, which shall accrue at a rate per annum equal to the
Applicable Rate applicable to interest on Eurodollar Revolving
Loans on the average daily amount of such Lender's LC Exposure
(excluding any portion thereof attributable to unreimbursed LC
Disbursements) during the period from and including the Effective
Date to but excluding the later of the date on which such
Lender's Commitment terminates and the date on which such Lender
ceases to have any LC Exposure, and (ii) to the Issuing Bank a
fronting fee, which shall be the greater of (A) $500 or (B) an
amount equal to .10% per annum on the average daily amount of the
LC Exposure (excluding any portion thereof attributable to
unreimbursed LC Disbursements) during the period from and
including the Effective Date to but excluding the later of the
date of termination of the Commitments and the date on which
there ceases to be any LC Exposure, as well as the Issuing Bank's
standard fees with respect to the issuance, amendment, renewal or
extension of any Letter of Credit or processing of drawings
thereunder. Participation fees and fronting fees accrued through
and including the last day of March, June, September and December
of each year shall be payable on the third Business Day following
such last day, commencing on the first such date to occur after
the Effective Date; provided that all such fees shall be payable
on the date on which the Commitments terminate and any such fees
accruing after the date on which the
<PAGE>
<PAGE> 34
Commitments terminate shall be payable on demand. Any other fees
payable to the Issuing Bank pursuant to this paragraph shall be
payable within 10 days after demand. All participation fees and
fronting fees shall be computed on the basis of a year of 360
days and shall be payable for the actual number of days elapsed
(including the first day but excluding the last day).
(c) The Borrower agrees to pay to the Agents, for
their own accounts, fees payable in the amounts and at the times
separately agreed upon between the Borrower and the Agents.
(d) All fees payable hereunder shall be paid on the
dates due, in immediately available funds, to the Administrative
Agent (or to the Issuing Bank, in the case of fees payable to it)
for distribution, in the case of commitment fees and
participation fees, to the Lenders. Fees paid shall not be
refundable under any circumstances.
SECTION 2.13. Interest. (a) The Loans comprising
each Base Rate Borrowing shall bear interest at a rate per annum
equal to the Base Rate.
(b) The Loans comprising each Eurodollar Borrowing
shall bear interest at a rate per annum equal to (i) in the case
of a Eurodollar Revolving Loan, the Adjusted LIBO Rate for the
Interest Period in effect for such Borrowing plus the Applicable
Rate, or (ii) in the case of a Eurodollar Competitive Loan, the
LIBO Rate for the Interest Period in effect for such Borrowing
plus (or minus, as applicable) the Margin applicable to such
Loan.
(c) Each Absolute Rate Loan shall bear interest at a
rate per annum equal to the Absolute Rate applicable to such
Loan.
(d) Each Swing Line Loan shall bear interest at a rate
per annum equal to the Federal Funds Rate plus the Applicable
Rate applicable to Eurodollar Loans.
(e) Notwithstanding the foregoing, if any principal of
or interest on any Loan or any fee or other amount payable by the
Borrower hereunder is not paid when due, whether at stated
maturity, upon acceleration or otherwise, such overdue amount
shall bear interest, after as well as before judgment, at a rate
per annum equal to (i) in the case of overdue principal of any
Loan, 2% plus the rate otherwise applicable to such Loan as
provided above or (ii) in the case of any other amount, 2% plus
the rate applicable to Base Rate Loans as provided above.
(f) Accrued interest on each Loan shall be payable in
arrears on each Interest Payment Date for such Loan; provided
that (i) interest accrued pursuant to paragraph (e) of this
Section shall be payable on demand, (ii) in the event of any
repayment or prepayment of any Loan (other than a prepayment of a
Base Rate Revolving Loan prior to the end of the Availability
Period), accrued interest on the principal amount repaid or
prepaid shall be payable on
<PAGE>
<PAGE> 35
the date of such repayment or prepayment, (iii) in the event of
any conversion of any Eurodollar Revolving Loan prior to the end
of the current Interest Period therefor, accrued interest on such
Loan shall be payable on the effective date of such conversion
and (iv) all accrued interest shall be payable upon termination
of the Commitments.
(g) All interest hereunder shall be computed on the
basis of a year of 360 days, except that interest computed by
reference to the Base Rate at times when the Base Rate is based
on the Prime Rate shall be computed on the basis of a year of 365
days (or 366 days in a leap year), and in each case shall be
payable for the actual number of days elapsed (including the
first day but excluding the last day). The applicable Base Rate,
Adjusted LIBO Rate or LIBO Rate shall be determined by the
Administrative Agent, and such determination shall be conclusive
absent manifest error.
SECTION 2.14. Alternate Rate of Interest. If prior
to the commencement of any Interest Period for a Eurodollar
Borrowing:
(a) the Administrative Agent determines (which
determination shall be conclusive absent manifest error)
that adequate and reasonable means do not exist for
ascertaining the Adjusted LIBO Rate or the LIBO Rate, as
applicable, for such Interest Period; or
(b) the Administrative Agent is advised by the
Required Lenders (or, in the case of a Eurodollar
Competitive Loan, the Lender that is required to make such
Loan) that the Adjusted LIBO Rate or the LIBO Rate, as
applicable, for such Interest Period will not adequately and
fairly reflect the cost to such Lenders (or Lender) of
making or maintaining their Loans (or its Loan) included in
such Borrowing for such Interest Period;
then the Administrative Agent shall give notice thereof to the
Borrower and the Lenders by telephone or telecopy as promptly as
practicable thereafter and, until the Administrative Agent
notifies the Borrower and the Lenders that the circumstances
giving rise to such notice no longer exist, (i) any Interest
Election Request that requests the conversion of any Revolving
Borrowing to, or continuation of any Revolving Borrowing as, a
Eurodollar Borrowing shall be ineffective, (ii) if any Borrowing
Request requests a Eurodollar Revolving Borrowing, such Borrowing
shall be made as a Base Rate Borrowing and (iii) any request by
the Borrower for a Eurodollar Competitive Borrowing shall be
ineffective; provided that (A) if the circumstances giving rise
to such notice do not affect all the Lenders, then requests by
the Borrower for Eurodollar Competitive Borrowings may be made to
Lenders that are not affected thereby and (B) if the
circumstances giving rise to such notice affect only one Type of
Borrowings, then the other Type of Borrowings shall be permitted.
SECTION 2.15. Increased Costs. (a) If any Change in
Law shall:
<PAGE>
<PAGE> 36
(i) impose, modify or deem applicable any
reserve, special deposit or similar requirement against
assets of, deposits with or for the account of, or credit
extended by, any Lender (except any such reserve requirement
reflected in the Adjusted LIBO Rate) or the Issuing Bank; or
(ii) impose on any Lender or the Issuing Bank or
the London interbank market any other condition affecting
this Agreement or Eurodollar Loans or Absolute Rate Loans
made by such Lender or any Letter of Credit or participation
therein;
and the result of any of the foregoing shall be to increase the
cost to such Lender of making or maintaining any Eurodollar Loan
or Absolute Rate Loan (or of maintaining its obligation to make
any such Loan) or to increase the cost to such Lender or the
Issuing Bank of participating in, issuing or maintaining any
Letter of Credit or to reduce the amount of any sum received or
receivable by such Lender or the Issuing Bank hereunder (whether
of principal, interest or otherwise), then the Borrower will pay
to such Lender or the Issuing Bank, as the case may be, such
additional amount or amounts as will compensate such Lender or
the Issuing Bank, as the case may be, for such additional costs
incurred or reduction suffered.
(b) If any Lender or the Issuing Bank determines that
any Change in Law regarding capital requirements has or would
have the effect of reducing the rate of return on such Lender's
or the Issuing Bank's capital or on the capital of such Lender's
or the Issuing Bank's holding company, if any, as a consequence
of this Agreement or the Loans made by, or participations in
Letters of Credit held by, such Lender, or the Letters of Credit
issued by the Issuing Bank, to a level below that which such
Lender or the Issuing Bank or such Lender's or the Issuing Bank's
holding company could have achieved but for such Change in Law
(taking into consideration such Lender's or the Issuing Bank's
policies and the policies of such Lender's or the Issuing Bank's
holding company with respect to capital adequacy), then from time
to time the Borrower will pay to such Lender or the Issuing Bank,
as the case may be, such additional amount or amounts as will
compensate such Lender or the Issuing Bank or such Lender's or
the Issuing Bank's holding company for any such reduction
suffered.
(c) A certificate of a Lender or the Issuing Bank
setting forth the amount or amounts necessary to compensate such
Lender or the Issuing Bank or its holding company, as the case
may be, as specified in paragraph (a) or (b) of this Section
shall be delivered to the Borrower and shall be conclusive absent
manifest error. The Borrower shall pay such Lender or the
Issuing Bank, as the case may be, the amount shown as due on any
such certificate within 10 days after receipt thereof.
(d) Failure or delay on the part of any Lender or the
Issuing Bank to demand compensation pursuant to this Section
shall not constitute a waiver of such Lender's or the Issuing
Bank's right to demand such compensation; provided that the
Borrower shall not be required to compensate a Lender or the
Issuing Bank pursuant to this Section for any increased costs or
<PAGE>
<PAGE> 37
reductions incurred more than six months prior to the date that
such Lender or the Issuing Bank, as the case may be, notifies the
Borrower of the Change in Law giving rise to such increased costs
or reductions and of such Lender's or the Issuing Bank's
intention to claim compensation therefor; provided further that,
if the Change in Law giving rise to such increased costs or
reductions is retroactive, then the six-month period referred to
above shall be extended to include the period of retroactive
effect thereof.
(e) Notwithstanding the foregoing provisions of this
Section, a Lender shall not be entitled to compensation pursuant
to this Section in respect of any Competitive Loan if the Change
in Law that would otherwise entitle it to such compensation shall
have been publicly announced prior to submission of the
Competitive Bid pursuant to which such Loan was made.
SECTION 2.16. Break Funding Payments. In the event
of (a) the payment of any principal of any Eurodollar Loan or
Absolute Rate Loan other than on the last day of an Interest
Period applicable thereto (including as a result of an Event of
Default), (b) the conversion of any Eurodollar Loan other than on
the last day of the Interest Period applicable thereto, (c) the
failure to borrow, convert, continue or prepay any Revolving Loan
on the date specified in any notice delivered pursuant hereto
(regardless of whether such notice is permitted to be revocable
under Section 2.11(b) and is revoked in accordance herewith),
(d) the failure to borrow any Competitive Loan after accepting
the Competitive Bid to make such Loan, or (e) the assignment of
any Eurodollar Loan or Absolute Rate Loan other than on the last
day of the Interest Period applicable thereto as a result of a
request by the Borrower pursuant to Section 2.19, then, in any
such event, the Borrower shall compensate each Lender for the
loss, cost and expense attributable to such event. In the case
of a Eurodollar Loan, the loss to any Lender attributable to any
such event shall be deemed to include an amount determined by
such Lender to be equal to the excess, if any, of (i) the amount
of interest that such Lender would pay for a deposit equal to the
principal amount of such Loan for the period from the date of
such payment, conversion, failure or assignment to the last day
of the then current Interest Period for such Loan (or, in the
case of a failure to borrow, convert or continue, the duration of
the Interest Period that would have resulted from such borrowing,
conversion or continuation) if the interest rate payable on such
deposit were equal to the Adjusted LIBO Rate for such Interest
Period, over (ii) the amount of interest that such Lender would
earn on such principal amount for such period if such Lender were
to invest such principal amount for such period at the interest
rate that would be bid by such Lender (or an affiliate of such
Lender) for dollar deposits from other banks in the eurodollar
market at the commencement of such period. A certificate of any
Lender setting forth any amount or amounts that such Lender is
entitled to receive pursuant to this Section shall be delivered
to the Borrower and shall be conclusive absent manifest error.
The Borrower shall pay such Lender the amount shown as due on any
such certificate within 10 days after receipt thereof.
<PAGE>
<PAGE> 38
SECTION 2.17. Taxes. (a) Any and all payments by or
an account of any obligation of the Borrower hereunder shall be
made free and clear of and without deduction for any Indemnified
Taxes or Other Taxes; provided that if the Borrower shall be
required to deduct any Indemnified Taxes or Other Taxes from such
payments, then (i) the sum payable shall be increased as
necessary so that after making all required deductions (including
deductions applicable to additional sums payable under this
Section) the Administrative Agent, Lender or Issuing Bank (as the
case may be) receives an amount equal to the sum it would have
received had no such deductions been made, (ii) the Borrower
shall make such deductions and (iii) the Borrower shall pay the
full amount deducted to the relevant Governmental Authority in
accordance with applicable law.
(b) In addition, the Borrower shall pay any Other
Taxes to the relevant Governmental Authority in accordance with
applicable law.
(c) The Borrower shall indemnify the Administrative
Agent, each Lender and the Issuing Bank, within 10 days after
written demand therefor, for the full amount of any Indemnified
Taxes or Other Taxes (including Indemnified Taxes or Other Taxes
imposed or asserted on or attributable to amounts payable under
this Section) paid by the Administrative Agent, such Lender or
the Issuing Bank, as the case may be, and any penalties, interest
and reasonable expenses arising therefrom or with respect
thereto, whether or not such Indemnified Taxes or Other Taxes
were correctly or legally imposed or asserted by the relevant
Governmental Authority. A certificate as to the amount of such
payment or liability delivered to the Borrower by a Lender or the
Issuing Bank, or by the Administrative Agent on its own behalf or
on behalf of a Lender or the Issuing Bank, shall be conclusive
absent manifest error.
(d) As soon as practicable after any payment of
Indemnified Taxes or Other Taxes by the Borrower to a
Governmental Authority, the Borrower shall deliver to the
Administrative Agent the original or a certified copy of a
receipt issued by such Governmental Authority evidencing such
payment, a copy of the return reporting such payment or other
evidence of such payment reasonably satisfactory to the
Administrative Agent.
(e) Any Foreign Lender that is entitled to an
exemption from or reduction of withholding tax under the law of
the jurisdiction in which the Borrower is located, or any treaty
to which such jurisdiction is a party, with respect to payments
under this Agreement shall deliver to the Borrower (with a copy
to the Administrative Agent), at the time or times prescribed by
applicable law or reasonably requested by the Borrower, such
properly completed and executed documentation prescribed by
applicable law as will permit such payments to be made without
withholding or at a reduced rate.
SECTION 2.18. Payments Generally; Pro Rata Treatment;
Sharing of Set-offs. (a) The Borrower shall make each payment
required to be made by it hereunder (whether of principal,
interest, fees or reimbursement of LC
<PAGE>
<PAGE> 39
Disbursements, or under Section 2.15, 2.16 or 2.17, or otherwise)
prior to 12:00 noon, Dallas time, on the date when due, in
immediately available funds, without set-off or counterclaim.
Any amounts received after such time on any date may, in the
discretion of the Administrative Agent, be deemed to have been
received on the next succeeding Business Day for purposes of
calculating interest thereon. All such payments shall be made to
the Administrative Agent at its offices at 901 Main Street, 14th
Floor, Dallas, Texas 75202, except payments to be made directly
to the Issuing Bank or Swingline Lender as expressly provided
herein and except that payments pursuant to Sections 2.15, 2.16,
2.17 and 9.03 shall be made directly to the Persons entitled
thereto. The Administrative Agent shall distribute any such
payments received by it for the account of any other Person to
the appropriate recipient promptly following receipt thereof. If
any payment hereunder shall be due on a day that is not a
Business Day, the date for payment shall be extended to the next
succeeding Business Day, and, in the case of any payment accruing
interest, interest thereon shall be payable for the period of
such extension. All payments hereunder shall be made in dollars.
(b) If at any time insufficient funds are received by
and available to the Administrative Agent to pay fully all
amounts of principal, unreimbursed LC Disbursements, interest and
fees then due hereunder, such funds shall be applied (i) first,
to pay interest and fees then due hereunder, ratably among the
parties entitled thereto in accordance with the amounts of
interest and fees then due to such parties, and (ii) second, to
pay principal and unreimbursed LC Disbursements then due
hereunder, ratably among the parties entitled thereto in
accordance with the amounts of principal and unreimbursed LC
Disbursements then due to such parties.
(c) If any Lender shall, by exercising any right of
set-off or counterclaim or otherwise, obtain payment in respect
of any principal of or interest on any of its Revolving Loans or
participations in LC Disbursements or Swingline Loans resulting
in such Lender receiving payment of a greater proportion of the
aggregate amount of its Revolving Loans and participations in LC
Disbursements and Swingline Loans and accrued interest thereon
than the proportion received by any other Lender, then the Lender
receiving such greater proportion shall purchase (for cash at
face value) participations in the Revolving Loans and
participations in LC Disbursements and Swingline Loans of other
Lenders to the extent necessary so that the benefit of all such
payments shall be shared by the Lenders ratably in accordance
with the aggregate amount of principal of and accrued interest on
their respective Revolving Loans and participations in LC
Disbursements and Swingline Loans; provided that (i) if any such
participations are purchased and all or any portion of the
payment giving rise thereto is recovered, such participations
shall be rescinded and the purchase price restored to the extent
of such recovery, without interest, and (ii) the provisions of
this paragraph shall not be construed to apply to any payment
made by the Borrower pursuant to and in accordance with the
express terms of this Agreement or any payment obtained by a
Lender as consideration for the assignment of or sale of a
participation in any of its Loans or participations in LC
Disbursements to any assignee or participant, other than to the
Borrower or any Subsidiary or Affiliate thereof (as to which the
provisions of this paragraph shall apply). The Borrower
<PAGE>
<PAGE> 40
consents to the foregoing and agrees, to the extent it may
effectively do so under applicable law, that any Lender acquiring
a participation pursuant to the foregoing arrangements may
exercise against the Borrower rights of set-off and counterclaim
with respect to such participation as fully as if such Lender
were a direct creditor of the Borrower in the amount of such
participation.
(d) Unless the Administrative Agent shall have
received notice from the Borrower prior to the date on which any
payment is due to the Administrative Agent for the account of the
Lenders or the Issuing Bank hereunder that the Borrower will not
make such payment, the Administrative Agent may assume that the
Borrower has made such payment on such date in accordance
herewith and may, in reliance upon such assumption, distribute to
the Lenders or the Issuing Bank, as the case may be, the amount
due. In such event, if the Borrower has not in fact made such
payment, then each of the Lenders or the Issuing Bank, as the
case may be, severally agrees to repay to the Administrative
Agent forthwith on demand the amount so distributed to such
Lender or Issuing Bank with interest thereon, for each day from
and including the date such amount is distributed to it to but
excluding the date of payment to the Administrative Agent, at the
Federal Funds Rate.
(e) If any Lender shall fail to make any payment
required to be made by it pursuant to Section 2.05(c), 2.06(d) or
(e), 2.07(b) or 2.18(d), then the Administrative Agent may, in
its discretion (notwithstanding any contrary provision hereof),
apply any amounts thereafter received by the Administrative Agent
for the account of such Lender to satisfy such Lender's
obligations under such Sections until all such unsatisfied
obligations are fully paid.
SECTION 2.19. Mitigation Obligations; Replacement of
Lenders. (a) If any Lender requests compensation under
Section 2.15, or if the Borrower is required to pay any
additional amount to any Lender or any Governmental Authority for
the account of any Lender pursuant to Section 2.17, then such
Lender shall use reasonable efforts to designate a different
lending office for funding or booking its Loans hereunder or to
assign its rights and obligations hereunder to another of its
offices, branches or affiliates, if, in the judgment of such
Lender, such designation or assignment (i) would eliminate or
reduce amounts payable pursuant to Section 2.15 or 2.17, as the
case may be, in the future and (ii) would not subject such Lender
to any unreimbursed cost or expense and would not otherwise be
disadvantageous to such Lender. The Borrower hereby agrees to
pay all reasonable costs and expenses incurred by any Lender in
connection with any such designation or assignment.
(b) If any Lender requests compensation under
Section 2.15, or if the Borrower is required to pay any
additional amount to any Lender or any Governmental Authority for
the account of any Lender pursuant to Section 2.17, or if any
Lender defaults in its obligation to fund Loans hereunder, then
the Borrower may, at its sole expense and effort, upon notice to
such Lender and the Administrative Agent, require such Lender to
assign and delegate, without recourse (in accordance with and
subject to the restrictions contained in Section 9.04), all its
interests, rights and obligations under this Agreement
<PAGE>
<PAGE> 41
(other than any outstanding Competitive Loans held by it) to an
assignee that shall assume such obligations (which assignee may
be another Lender, if a Lender accepts such assignment); provided
that (i) the Borrower shall have received the prior written
consent of the Administrative Agent (and, if a Commitment is
being assigned, the Issuing Bank and Swingline Lender), which
consent shall not unreasonably be withheld, (ii) such Lender
shall have received payment of an amount equal to the outstanding
principal of its Loans (other than Competitive Loans) and
participations in LC Disbursements and Swingline Loans, accrued
interest thereon, accrued fees and all other amounts payable to
it hereunder, from the assignee (to the extent of such
outstanding principal and accrued interest and fees) or the
Borrower (in the case of all other amounts) and (iii) in the case
of any such assignment resulting from a claim for compensation
under Section 2.15 or payments required to be made pursuant to
Section 2.17, such assignment will result in a reduction in such
compensation or payments. A Lender shall not be required to make
any such assignment and delegation if, prior thereto, as a result
of a waiver by such Lender or otherwise, the circumstances
entitling the Borrower to require such assignment and delegation
cease to apply.
SECTION 2.20. Commitment Increases. (a) In the event
that the Borrower wishes to increase the aggregate Commitments at
any time that no Event of Default has occurred and is continuing,
it shall notify the Administrative Agent in writing of the amount
(the "Offered Increase Amount") of such proposed increase (such
notice, a "Commitment Increase Notice"), provided that increases
in the aggregate Commitments shall be in increments of
$50,000,000 and the aggregate Commitments shall not be increased
to an amount exceeding $700,000,000. The Borrower may, at its
election, (i) offer one or more of the Lenders the opportunity to
participate in all or a portion of the Offered Increase Amount
pursuant to subsection (c) below and/or (ii) with the consent of
the Administrative Agent (which consent shall not be unreasonably
withheld), offer one or more additional banks, financial
institutions or other entities the opportunity to participate in
all or a portion of the Offered Increase Amount pursuant to
paragraph (b) below. Each Commitment Increase Notice shall
specify which Lenders and/or banks, financial institutions or
other entities the Borrower desires to participate in such
commitment increase. The Borrower or, if requested by the
Borrower, the Administrative Agent will notify such Lenders,
and/or banks, financial institutions or other entities of such
offer.
(b) Any additional bank, financial institution or
other entity which the Borrower selects to offer participation in
the increased Commitments, and which elects to become a party to
this Agreement and obtain a Commitment shall execute a New Lender
Supplement with the Borrower and the Administrative Agent,
substantially in the form of Exhibit C, whereupon such bank,
financial institution or other entity (for purposes of this
Section 2.20, herein called a "New Lender") shall become a Lender
for all purposes and to the same extent as if originally a party
hereto and shall be bound by and entitled to the benefits of this
Agreement, and Schedule 2.01 shall be deemed to be amended to add
the name and Commitments of such New Lender, provided
<PAGE>
<PAGE> 42
that the Commitment of any such New Lender shall be in an amount
not less than $10,000,000.
(c) Any Lender which accepts an offer to it by the
Borrower to increase its Commitment pursuant to subsection
2.20(a)(i) shall, in each case, execute a Commitment Increase
Supplement with the Borrower and the Administrative Agent,
substantially in the form of Exhibit D, whereupon such Lender
shall be bound by and entitled to the benefits of this Agreement
with respect to the full amount of its Commitment as so
increased, and Schedule 2.01 shall be deemed to be amended to so
increase the Commitment of such Lender.
(d) The effectiveness of any New Lender Supplement or
Commitment Increase Supplement shall be contingent upon receipt
by the Administrative Agent of such corporate resolutions of the
Borrower and legal opinions of counsel to the Borrower as it
shall reasonably request with respect thereto.
(e) If any bank, financial institution or other entity
becomes a New Lender pursuant to subsection 2.20(b) or any
Lender's Commitment is increased pursuant to subsection 2.20(c),
additional Loans made on or after the effectiveness thereof (the
"Re-Allocation Date") shall be made pro rata based on the
Applicable Percentages in effect on and after such Re-Allocation
Date (except to the extent that any such pro rata borrowings
would result in any Lender making an aggregate principal amount
of Loans in excess of its Commitment, in which case such excess
amount will be allocated to, and made by, such New Lenders and/or
Lenders with such increased Commitments to the extent of, and pro
rata based on, their respective Commitments otherwise available
for Loans), and continuations of Eurodollar Loans outstanding on
such Re-Allocation Date shall be effected by repayment of such
Eurodollar Loans on the last day of the Interest Period
applicable thereto and the making of new Eurodollar Loans pro
rata based on such new Applicable Percentages. In the event that
on any such Re-Allocation Date there is an unpaid principal
amount of Base Rate Loans, the Borrower shall make prepayments
thereof and borrowings of Base Rate Loans so that, after giving
effect thereto, the Base Rate Loans outstanding are held pro rata
based on such new Applicable Percentages. In the event that on
any such Re-Allocation Date there is an unpaid principal amount
of Eurodollar Loans, such Eurodollar Loans shall remain
outstanding with the respective holders thereof until the
expiration of their respective Interest Periods (unless the
Borrower elects to prepay any thereof in accordance with the
applicable provisions of this Agreement), and interest on and
repayments of such Eurodollar Loans will be paid thereon to the
respective Lenders holding such Eurodollar Loans pro rata based
on the respective principal amounts thereof outstanding.
(f) Notwithstanding anything to the contrary in this
subsection 2.20, (i) in no event shall any transaction effected
pursuant to this subsection 2.20 cause the aggregate Commitments
to exceed $700,000,000, and (ii) no Lender shall have any
obligation to increase its Commitment unless it agrees to do so
in its sole discretion.
<PAGE>
<PAGE> 43
ARTICLE III
Representations and Warranties
The Borrower represents and warrants to the Lenders
that:
SECTION 3.01. Corporate Status. Each of the Borrower
and each of its Subsidiaries (i) is a duly organized and validly
existing corporation or partnership in good standing under the
laws of its jurisdiction of organization, (ii) has all requisite
power and authority to own its property and assets and to
transact the business in which it is engaged and presently
proposes to engage, and (iii) if a corporation or a limited
partnership, is duly qualified and is authorized to do business
and is in good standing in all jurisdictions where the failure to
do so would have a Material Adverse Effect. As of the Effective
Date, the Subsidiaries listed on Schedule 3.01 hereto constitute
all of the Subsidiaries of the Borrower.
SECTION 3.02. Corporate Power and Authority. The
Borrower has the corporate power to execute, deliver and carry
out the terms and provisions of this Agreement and each other
agreement or instrument contemplated hereby to which it is or
will be a party and to borrow hereunder. The Borrower has taken
all necessary corporate action to authorize the execution,
delivery and performance of this Agreement and the borrowings and
other transactions contemplated hereby. This Agreement has been
duly executed and delivered by the Borrower and constitutes the
legal, valid and binding obligations of the Borrower enforceable
in accordance with their respective terms except as the
enforceability thereof may be limited by applicable bankruptcy,
insolvency, reorganization, receivership or other similar laws
affecting the enforcement of creditors' rights generally and by
general principles of equity.
SECTION 3.03. No Violation. Neither the execution,
delivery nor performance by the Borrower of this Agreement, nor
the consummation of the transactions herein contemplated, nor
compliance with the terms and provisions herein, (i) will
contravene any applicable provision of any law, statute, rule,
regulation, order, writ, injunction or decree of any court or
governmental instrumentality or (ii) will conflict or be
inconsistent with or result in any breach of, any of the terms,
covenants, conditions or provisions of, or constitute a default
under, or result in the creation or imposition of (or the
obligation to create or impose) any Lien upon any of the property
or assets of the Borrower or any of its Subsidiaries pursuant to
the terms of any indenture, mortgage, deed of trust, or other
material agreement or instrument to which the Borrower or any of
its Subsidiaries is a party or by which it or any of its property
or assets is bound or to which it may be subject, or (iii) will
violate any provision of the Certificate of Incorporation or
By-Laws or, in the case of any partnership, the applicable
partnership agreement or other organizational documents, of the
Borrower or any of its Subsidiaries.
SECTION 3.04. Litigation. Except as disclosed in the
Borrower's Annual Report on Form 10-K for the year ended December
31, 1996, there are no
<PAGE>
<PAGE> 44
actions, suits or proceedings pending or, to the best knowledge
of the Borrower, threatened against or affecting the Borrower or
any of its Subsidiaries before any court or before any
governmental or administrative body or agency that (individually
or in the aggregate) are reasonably likely to have a Material
Adverse Effect.
SECTION 3.05. Financial Statements. The audited
consolidated statement of financial condition of the Borrower and
its consolidated Subsidiaries at December 31, 1996 and the
related consolidated statements of income and retained earnings
and cash flows of the Borrower and its consolidated Subsidiaries
for the fiscal year ending December 31, 1996 and the unaudited
consolidated statement of financial condition of the Borrower and
its consolidated Subsidiaries at June 30, 1997 and the related
consolidated statements of income and retained earnings and cash
flows of the Borrower and its consolidated Subsidiaries for the
six months ending June 30, 1997 heretofore furnished to the
Lenders present fairly the consolidated financial condition of
the Borrower at the date of said statements for said periods,
subject to year-end audit adjustments in the case of such
unaudited statements. All such financial statements have been
prepared in accordance with GAAP consistently applied except for
such changes as have been concurred with by Coopers & Lybrand,
independent public accountants for the Borrower, and disclosed in
accordance with GAAP in such financial statements or the report
thereon by Coopers & Lybrand. Since June 30, 1997, there has
been no material adverse change in the financial condition or
results of operations of the Borrower and its Subsidiaries taken
as a whole or in the ability of the Borrower and its Subsidiaries
taken as a whole to satisfy their financial obligations.
SECTION 3.06. Governmental Approvals. No order,
consent, approval, license, authorization, or validation of, or
filing, recording or registration with, or exemption by, any
governmental or public body or authority, or any subdivision
thereof, is required to authorize, or is required in connection
with (i) the execution, delivery and performance by the Borrower
of this Agreement or (ii) the legality, validity, binding effect
or enforceability of this Agreement as against the Borrower.
SECTION 3.07. Use of Proceeds; Regulation U. The
proceeds of all incurrences of Loans, and the Letters of Credit,
will be used by the Borrower for general corporate purposes,
which may include, without limitation to provide funds for the
support and repayment of Commercial Paper. Neither the making of
any Loan hereunder, nor the use of the proceeds thereof, will
violate or be inconsistent with the provisions of Regulation G,
T, U or X of the Board of Governors of the Federal Reserve
System.
SECTION 3.08. Investment Company Act. The Borrower is
not an "investment company" or a company "controlled" by an
"investment company", within the meaning of the Investment
Company Act of 1940, as amended.
<PAGE>
<PAGE> 45
SECTION 3.09. Public Utility Holding Company Act.
Neither the Borrower nor any of its Subsidiaries is a "holding
company", or a "subsidiary company" of a "holding company", or an
"affiliate" of a "holding company" or of a "subsidiary company"
of a "holding company", within the meaning of the Public Utility
Holding Company Act of 1935, as amended.
SECTION 3.10. True and Complete Disclosure. All
factual information heretofore or contemporaneously furnished by
or on behalf of the Borrower in writing to any Lender, for
purposes of or in connection with this Agreement or any
transaction contemplated hereby is, and all other such factual
information hereafter furnished by or on behalf of the Borrower
in writing to any Lender will be, true and accurate in all
material respects on the date as of which such information is
dated or certified and not incomplete by omitting to state any
material fact necessary to make such information (taken as a
whole) not misleading at such time in light of the circumstances
under which such information was provided. There is no fact
known to the Borrower (other than matters of a general economic
nature) which is reasonably likely to have a Material Adverse
Effect, which has not been disclosed herein or in such other
documents, certificates and statements furnished to the Lenders
for use in connection with the transactions contemplated hereby.
SECTION 3.11. No Default. Neither the Borrower nor
any of its Subsidiaries is in default under or with respect to
any Contractual Obligation in any respect which (individually or
in the aggregate) is reasonably likely to have a Material Adverse
Effect. Neither the Borrower nor any of its Subsidiaries is in
default under any order, award or decree of any Governmental
Authority or arbitrator binding upon or affecting it or them or
by which any of its or their properties or assets may be bound or
affected in any respect which (individually or in the aggregate)
is reasonably likely to have a Material Adverse Effect. No
Default or Event of Default has occurred and is continuing.
SECTION 3.12. Ownership of Property. To the extent
customary in the oil and gas business for the type and location
of the relevant property and consistent with the past practices
of the Borrower in effect on the Effective Date, each of the
Borrower and its Subsidiaries has good title to all its material
Oil and Gas Interests.
SECTION 3.13. ERISA. No ERISA Event has occurred or
is reasonably expected to occur that, when taken together with
all other such ERISA Events for which liability is reasonably
expected to occur, could reasonably be expected to result in a
Material Adverse Effect.
SECTION 3.14. Continuing Letters of Credit. Schedule
3.14 is a true and complete list, by reference to the aggregate
face amounts of letters of credit issued under the Existing
Credit Agreement by the Persons listed thereon that are also
Lenders (but which are not designated as Issuing Banks
<PAGE>
<PAGE> 46
pursuant to the definition of Issuing Bank) of letters of credit
issued by such Persons outstanding as of the dates set forth in
such Schedule ("Continuing Letters of Credit").
ARTICLE IV
Conditions
SECTION 4.01. Effective Date. The obligation of each
Lender to make Loans to, and of the Issuing Bank to issue Letters
of Credit for the account of, the Borrower hereunder on or after
the Effective Date is subject to the satisfaction of the
following conditions on or prior to the Effective Date:
(a) On the Effective Date, there shall have been
delivered to the Administrative Agent for the account of each
Lender, this Agreement, executed and delivered by a duly
authorized officer of each party hereto.
(b) On the Effective Date, the Administrative Agent
shall have received a certificate dated the Effective Date, and
signed by a Financial Officer of the Borrower, stating that (to
the best of his knowledge) the conditions set forth in Section
4.01(g) exist as of such date.
(c) On the Effective Date, the Administrative Agent
shall have received an opinion, addressed to each Lender and
dated such date, from each of (i) Cravath, Swaine & Moore,
special counsel to the Borrower, covering the matters set forth
in Exhibit B-1 hereto and (ii) William C. Lemmer, Vice President,
General Counsel and Secretary of the Borrower, covering the
matters set forth in Exhibit B-2 hereto. Each such legal opinion
shall also cover such other matters incident to the transactions
contemplated herein as the Administrative Agent may reasonably
request.
(d) (i) On or prior to the Effective Date, the
Administrative Agent shall have received certified copies of the
Borrower's charter documents, by-laws, resolutions of the
Borrower's Board of Directors evidencing the Borrower's authority
to enter into this Agreement, and certificates of incumbency,
each in form and substance satisfactory to the Administrative
Agent.
(ii) On or prior to the Effective Date, the
Administrative Agent shall have received all information and
copies of all documents and papers, including records of
corporate proceedings and governmental approvals, if any, which
the Administrative Agent reasonably may have requested in
connection therewith, such documents and papers where appropriate
to be certified by proper corporate or governmental authorities.
(e) The Administrative Agent shall have received (or
shall have concurrently received) the fees to be received by it
for its account and the account of the Agents and Lenders on or
prior to the Effective Date referred to in Section 2.12(c).
<PAGE>
<PAGE> 47
(f) The Administrative Agent shall have received
evidence, in form and substance satisfactory to it, that no
Revolving Credit Loans (as defined in the Existing Credit
Agreement) are outstanding on the Effective Date and all fees,
interest, breakage costs and dollar amounts owing thereunder have
been paid in full; and
(g) On the Effective Date:
(i) Each of the representations and warranties
made by the Borrower in or pursuant to this Agreement shall
be true and correct in all material respects on and as of
such date as if made on and as of such date.
(ii) No Default or Event of Default shall have
occurred and be continuing on such date or after giving
effect to any Loans or Letters of Credit requested to be
made or issued on such date.
This Agreement and all of the certificates, legal opinions and
other documents and papers referred to in this Section 4 shall be
delivered to the Administrative Agent at the offices of Simpson
Thacher & Bartlett for the account of each of the Lenders.
SECTION 4.02. Each Credit Event. The agreement of
each Lender to make any Loan requested to be made by it on any
date after the Effective Date, and of the Issuing Bank to issue
any Letter of Credit on any date after the Effective Date, is
subject to the satisfaction of the following conditions
precedent:
(a) Representations and Warranties. Each of the
representations and warranties made by the Borrower in or
pursuant to this Agreement, other than the representations
and warranties contained in subsections 3.04, 3.05 and 3.13
provided that the Borrower has achieved a rating by Moody's
or S&P applicable on such date to its Index Debt of at least
either Baa2 or BBB, respectively, shall be true and correct
in all material respects on and as of the date of such Loan
or issuance of such Letter of Credit as if made on and as of
such date.
(b) No Default. No Default or Event of Default shall
have occurred and be continuing on the date of such Loan or
issuance of such Letter of Credit or after giving effect to
the Loans requested to be made or any Letter of Credit
requested to be issued, as the case may be, on such date.
Each borrowing of Loans by and issuance of a Letter of Credit for
the account of the Borrower hereunder shall constitute a
representation and warranty by the Borrower as of the date such
Loans are borrowed or such Letter of Credit is issued, as the
case may be, that the conditions contained in this Section 4.02
have been satisfied (except to the extent that, prior to or
concurrently with the delivery of the relevant Borrowing Request,
Competitive Bid Request or notice requesting issuance of a Letter
of Credit, as the case may be, the Borrower notifies the Lenders
in writing, through the Administrative Agent, that any such
conditions shall not be satisfied).
<PAGE>
<PAGE> 48
ARTICLE V
Affirmative Covenants
Until the Commitments have expired or been terminated
and the principal of and interest on each Loan and all fees
payable hereunder shall have been paid in full and all Letters of
Credit shall have expired or terminated and all LC Disbursements
shall have been reimbursed, the Borrower covenants and agrees
with the Lenders that:
SECTION 5.01. Financial Statements and Other
Information. The Borrower will deliver to the Administrative
Agent, with sufficient copies for each Lender:
(a) as soon as available and in any event within
60 days after the end of the relevant fiscal quarter, the
consolidated financial statements of each of (i) Energy
Partners and its consolidated Subsidiaries and (ii) the
Borrower and its consolidated Subsidiaries for each of the
first three fiscal quarters of each fiscal year of the
Borrower or Energy Partners, as the case may be, as filed
with the Securities and Exchange Commission ("SEC") on
Form 10-Q (or any form which replaces Form 10-Q), or if the
Borrower or Energy Partners is not required to file any such
form with the SEC, an unaudited report containing the
financial information that would be required to be contained
in such form, such report to be certified by a Financial
Officer of the Borrower or Energy Partners, as the case may
be;
(b) as soon as available and in any event within
120 days after the end of the relevant fiscal year, the
consolidated financial statements of each of (i) Energy
Partners and its consolidated Subsidiaries and (ii) the
Borrower and its consolidated Subsidiaries for each fiscal
year as filed with the SEC on Form 10-K (or any form which
replaces Form 10-K) containing financial statements
accompanied by the report thereon by Coopers & Lybrand or
other independent public accountants of recognized national
standing, or if the Borrower or Energy Partners is not
required to file any such form with the SEC, the financial
information that would be required to be contained in such
form accompanied by a report thereon by Coopers & Lybrand or
other independent public accountants of recognized national
standing;
(c) at the time of the delivery of the financial
statements provided for in this Section 5.01, a certificate
of a Financial Officer of the Borrower to the effect that,
to the best of his knowledge, no Default or Event of Default
has occurred and is continuing or, if any Default or Event
of Default has occurred and is continuing, specifying the
nature and extent thereof and what type of remedial action
is being taken with respect thereto and which certificate
shall set forth the
<PAGE>
<PAGE> 49
calculations required to establish whether the Borrower was
in compliance with the provisions of Sections 6.02;
(d) promptly after the sending or filing thereof,
copies of all reports which the Borrower or Energy Partners
sends to its stockholders or unitholders generally, as the
case may be, and copies of all reports and registration
statements which the Borrower or Energy Partners files with
the SEC; and
(e) with reasonable promptness, such further
information regarding the condition or operations, financial
or otherwise, of the Borrower and its Subsidiaries as any
Lender through the Administrative Agent may from time to
time reasonably request.
SECTION 5.02. Notices of Material Events. Promptly,
and in any event within three Business Days after an officer of
the Borrower obtains knowledge thereof, the Borrower will deliver
to the Administrative Agent (with sufficient copies for each
Lender) notice of (i) the occurrence of any event which
constitutes a Default or Event of Default, (ii) any litigation or
governmental proceeding pending (x) against the Borrower or any
of its Subsidiaries which (individually or in the aggregate) is
or becomes reasonably likely to have a Material Adverse Effect or
(y) with respect to this Agreement, (iii) the occurrence of any
ERISA Event that, alone or together with any other ERISA Events
that have occurred, could reasonably be expected to result in a
Material Adverse Effect, (iv) the incurrence of any Environmental
Liability which is or becomes reasonably likely to have a
Material Adverse Effect and (v) the occurrence of any other event
which (individually or in the aggregate) is or becomes reasonably
likely to have a Material Adverse Effect.
SECTION 5.03. Existence; Conduct of Business. The
Borrower and its consolidated Subsidiaries will continue to
engage primarily in the oil and gas business and the Borrower
will, and will cause each of its consolidated Subsidiaries to do
or cause to be done, all things necessary to preserve and keep in
full force and effect its existence and its material rights,
franchises, licenses and patents, except to the extent that
failure to do or cause to be done any of the foregoing
(individually or in the aggregate) is not reasonably likely to
have a Material Adverse Effect. Nothing in this Section 5.03
shall prevent the merger of Subsidiaries into the Borrower or
with or into another Subsidiary or the withdrawal by the Borrower
or any of its Subsidiaries of its qualification as a foreign
corporation in any jurisdiction, provided that such merger or
withdrawal could not reasonably be expected to have a Material
Adverse Effect.
SECTION 5.04. Payment of Obligations. The Borrower
shall pay and discharge, and cause each Subsidiary to pay and
discharge, all taxes, assessments and governmental charges or
levies imposed upon it or upon its income or profits, or upon any
properties belonging to it, shown to be due and payable by the
Borrower or such Subsidiary on its tax returns, prior to the date
on which penalties attach thereto, and all lawful claims which,
if unpaid, might become a Lien upon any properties of the
Borrower or any Subsidiary, or maintain adequate reserves with
respect thereto in accordance
<PAGE>
<PAGE> 50
with GAAP, except to the extent that failure to pay or discharge
or cause to be paid or discharged any of the foregoing
(individually or in the aggregate) is not reasonably likely to
have a Material Adverse Effect, provided that neither the
Borrower nor any Subsidiary shall be required to pay any such
tax, assessment, charge, levy or claim which is being contested
in good faith and by proper proceedings and for which adequate
reserves in accordance with GAAP have been provided.
SECTION 5.05. Maintenance of Properties; Insurance.
The Borrower shall, and shall cause each Subsidiary to, keep all
property useful or necessary in its business in good working
order and condition (ordinary wear and tear excepted). The
Borrower shall maintain, and cause each Subsidiary to maintain,
insurance on its property with responsible and reputable
insurance companies or associations covering such risks (but
including in any event property, general liability and
environmental liability), and in such amounts as are in
accordance with normal industry practice.
SECTION 5.06. Compliance with Laws. The Borrower
shall comply, and cause each Subsidiary to comply, with the
requirements of all applicable laws (including ERISA and
environmental laws), rules, regulations and orders of any
Governmental Authority, non-compliance with which (individually
or in the aggregate) is reasonably likely to have a Material
Adverse Effect.
ARTICLE VI
Negative Covenants
Until the Commitments have expired or terminated and
the principal of and interest on each Loan and all fees payable
hereunder have been paid in full and all Letters of Credit have
expired or terminated and all LC Disbursements shall have been
reimbursed, the Borrower covenants and agrees with the Lenders
that:
SECTION 6.01. Indebtedness of Subsidiaries. In no
event shall the aggregate principal amount of Indebtedness of the
Subsidiaries of the Borrower (other than any Indebtedness owing
to the Borrower or any other Subsidiary) exceed $200,000,000 at
any one time outstanding for all Subsidiaries; provided that all
Indebtedness of the Borrower to any Subsidiary and of any
Subsidiary to the Borrower or any other Subsidiary shall be
evidenced by a note (or other appropriate instrument) or an
account entry clearly identifying its character as a liability.
SECTION 6.02. Financial Covenants. (a) The Borrower
shall not permit the ratio of Consolidated Total Indebtedness to
Discretionary Cash Flow for the four consecutive fiscal quarters
of the Borrower most recently ended to be greater than 3.75 to
1.0.
<PAGE>
<PAGE> 51
(b) The Borrower shall not permit the Tangible Net
Worth of the Borrower and its Subsidiaries on a consolidated
basis as of the end of any fiscal quarter to be less than the sum
of (i) the Tangible Net Worth of the Borrower and its
Subsidiaries on a consolidated basis as stated in its unaudited
consolidated balance sheet for the fiscal quarter ended June 30,
1997, plus (ii) fifty percent of positive net income since June
30, 1997, plus (iii) fifty percent of the net cash proceeds of
any capital stock offering since June 30, 1997, minus (iv)
$200,000,000.
SECTION 6.03. Liens. The Borrower shall not, and
shall not permit any Subsidiary to, create, incur, assume or
suffer to exist, any Lien (other than Permitted Liens) upon or
with respect to any property or assets (real or personal,
tangible or intangible) now owned or hereafter acquired by the
Borrower or any of its Subsidiaries and securing any
Indebtedness.
SECTION 6.04. Fundamental Changes. (a) The Borrower
shall not enter into any merger, consolidation or amalgamation,
unless:
(i) the Borrower shall be the continuing Person;
(ii) no Default or Event of Default shall have
occurred and be continuing or would result therefrom; and
(iii) the Borrower shall have delivered to the
Administrative Agent (x) a certificate of an officer of the
Borrower and (y) a legal opinion from counsel reasonably
satisfactory to the Administrative Agent, in each case to
the effect that such transaction complies with the
requirements of this Section 6.04(a).
(b) None of the Borrower, Energy Partners or SOLP
shall liquidate, wind up or dissolve itself (or suffer any
liquidation or dissolution of itself), or convey, sell, lease,
assign, transfer or otherwise dispose of all or substantially all
of its property, business or assets; provided that, Energy
Partners or SOLP may engage in any of the foregoing transactions
so long as after giving effect thereto, the beneficial ownership
interest of the Borrower in the assets of Energy Partners or
SOLP, as the case may be, is not decreased.
SECTION 6.05. Limitation on Affiliate Transactions.
The Borrower shall not, nor shall it permit any of its
Subsidiaries to, enter into any transaction (including, without
limitation, any purchase, sale or exchange of property or the
rendering of any services) with any Subsidiary (other than a
Wholly Owned Subsidiary of the Borrower or of such Subsidiary) or
Affiliate of the Borrower, unless such transaction is not
otherwise prohibited under this Agreement and is upon fair and
reasonable terms no less favorable to the Borrower or such
Subsidiary than it would obtain in a comparable arm's-length
transaction with a Person not a Subsidiary or an Affiliate.
<PAGE>
<PAGE> 52
SECTION 6.06. Energy Partners and SOLP. The Borrower
shall at all times maintain a 95% or greater ownership interest
in each of Energy Partners (whether through general partnership
interests or limited partnership units or both) and SOLP;
provided, however, that the foregoing shall not be construed to
prevent the liquidation or dissolution of Energy Partners or SOLP
in accordance with Section 6.04(b).
SECTION 6.07. Restrictions Affecting Subsidiaries.
The Borrower shall not enter into with any Person, or suffer to
exist any agreement which prohibits or limits the ability of any
of its Subsidiaries to pay dividends, loans, tax payments or
other distributions or transfer assets to the Borrower, except
(a) as permitted by this Agreement and (b) the foregoing shall
not be construed to prohibit covenants concerning financial
condition or results of operations contained in any agreement
governing permitted Indebtedness of a Subsidiary if, at the time
such agreement is entered into, the Borrower reasonably
anticipates that such financial covenants will not impair the
ability of such Subsidiary to pay dividends from its net income
in the ordinary course.
SECTION 6.08. Limitation on Sales and Leasebacks. The
Borrower may not enter into any arrangement (a "Sale and
Leaseback Transaction") with any Person providing for the leasing
by the Borrower or any Subsidiary of real or personal property,
provided that the value of such assets when considered in the
aggregate would not constitute a material amount of the assets of
the Borrower, which has been or is to be sold or transferred by
the Borrower or such Subsidiary to such Person or to any other
Person to whom funds have been or are to be advanced by such
Person on the security of such property or rental obligations of
the Borrower or any Subsidiary, except a Sale and Leaseback
Transaction with respect to any property may be consummated
within 120 days after the initial acquisition of such property by
the Borrower or the applicable Subsidiary.
ARTICLE VII
Events of Default
If any of the following events ("Events of Default")
shall occur:
(a) The Borrower shall default in the payment when due
of any principal of any Loan or any Reimbursement
Obligation; or
(b) The Borrower shall default in the payment of
interest in respect of any Loan or any Reimbursement
Obligation or in the payment of any fees or other amounts
payable under or with respect to this Agreement, and such
default shall continue unremedied for 5 days after the date
when due; or
(c) Any representation or warranty made by the
Borrower herein or in any writing furnished pursuant to this
Agreement by the Borrower
<PAGE>
<PAGE> 53
shall prove to be untrue in any material respect on the date
as of which made or deemed made; or
(d) The Borrower shall default in the due performance
or observance by it of any term, covenant or agreement
contained in Sections 5.02, 6.01, 6.02, 6.03, 6.04, 6.06 and
6.07 and notice thereof shall have been given to the
Borrower by the Administrative Agent or the Required
Lenders; or
(e) The Borrower shall default in the due performance
or observance by it of any term, covenant or agreement
contained in this Agreement (other than those referred to in
paragraphs (a), (b), (c) and (d) above) and such default
shall continue unremedied for a period of 30 days after
notice thereof shall have been given to the Borrower by the
Administrative Agent or the Required Lenders; or
(f) (i) The Borrower or any of its Material
Subsidiaries shall (A) fail to pay any principal of or
interest on its outstanding Indebtedness (other than the
Loans) when due (or, if permitted by the terms of the
relevant documents, within any applicable grace period) in
an aggregate amount in excess of $25,000,000, or (B) default
in the observance or performance of any agreement or
condition relating to any Indebtedness in an aggregate
amount in excess of $25,000,000 (other than the Loans) or
any other event shall exist or occur the effect of which
default or other event is to accelerate, or to permit the
holders of such Indebtedness to accelerate, such
Indebtedness prior to its stated maturity, or (ii) any event
(in the nature of a default or an event of default or
relating to the altered financial condition or prospects of
the Borrower) shall exist or occur which would permit the
holder of any Indebtedness of the Borrower or any of its
Material Subsidiaries (other than the Loans) to require the
Borrower or any of its Material Subsidiaries to repay prior
to its stated maturity, repurchase or redeem $25,000,000 or
more of any such Indebtedness or result in $25,000,000 or
more of any such Indebtedness becoming due and payable or
subject to repurchase or redemption prior to the stated
maturity date thereof; provided that this paragraph (f)
shall not be construed to apply to Indebtedness that becomes
due or is required to be repaid, repurchased or redeemed as
a result of a voluntary transfer of assets so long as the
Borrower does not default in such repayment, repurchase or
redemption; or
(g) an involuntary proceeding shall be commenced or an
involuntary petition shall be filed seeking (i) liquidation,
reorganization or other relief in respect of the Borrower or
any Material Subsidiary or its debts, or of a substantial
part of its assets, under any Federal, state or foreign
bankruptcy, insolvency, receivership or similar law now or
hereafter in effect or (ii) the appointment of a receiver,
trustee, custodian, sequestrator, conservator or similar
official for the Borrower or any Material Subsidiary or for
a substantial part of its assets, and, in any such
<PAGE>
<PAGE> 54
case, such proceeding or petition shall continue undismissed
for 90 days or an order or decree approving or ordering any
of the foregoing shall be entered; or
(h) the Borrower or any Material Subsidiary shall
(i) voluntarily commence any proceeding or file any petition
seeking liquidation, reorganization or other relief under
any Federal, state or foreign bankruptcy, insolvency,
receivership or similar law now or hereafter in effect,
(ii) consent to the institution of, or fail to contest in a
timely and appropriate manner, any proceeding or petition
described in clause (g) of this Article, (iii) apply for or
consent to the appointment of a receiver, trustee,
custodian, sequestrator, conservator or similar official for
the Borrower or any Material Subsidiary or for a substantial
part of its assets, (iv) file an answer admitting the
material allegations of a petition filed against it in any
such proceeding, (v) make a general assignment for the
benefit of creditors or (vi) take any action for the purpose
of effecting any of the foregoing; or
(i) an ERISA Event shall have occurred that, in the
opinion of the Required Lenders, when taken together with
all other ERISA Events that have occurred, could reasonably
be expected to result in a Material Adverse Effect; or
(j) a final judgment which, together with other
outstanding final judgments against the Borrower and/or its
Material Subsidiaries, exceeds an aggregate of $25,000,000
(the "Judgment Amount") shall be entered against the
Borrower and/or any Material Subsidiary and (i) within the
Applicable Period after entry thereof such judgment or
judgments shall not have been discharged or execution
thereof stayed pending appeal or, within the Applicable
Period after the expiration of any such stay, such judgment
or judgments shall not have been discharged or (ii) any
enforcement proceeding shall have been commenced (and not
stayed) by any creditor upon such judgment or judgments; or
(k) (a) any Person (other than the Borrower, a
Subsidiary of the Borrower or any employee benefit plan of
the Borrower or any of its Subsidiaries) or group (as such
term is used in Section 13(d) or 14(d)(2) of the Securities
Exchange Act of 1934, as amended) shall acquire, directly or
indirectly, beneficial ownership of an aggregate of 35% or
more of the issued and outstanding common stock of the
Borrower or (b) during any period of two consecutive years,
the individuals (the "Initial Directors") who at the
beginning of such period constituted the Board of Directors
of the Borrower (together with any new directors of the
Borrower whose election or nomination was approved by a vote
of at least two-thirds of such Initial Directors or new
directors so approved, or whose election or nomination was
so approved prior to such period) shall cease for any reason
to constitute 50% or more of the Board of Directors of the
Borrower;
<PAGE>
<PAGE> 55
then, and in every such event (other than an event with respect
to the Borrower described in clause (g) or (h) of this Article),
and at any time thereafter during the continuance of such event,
the Administrative Agent may, and at the request of the Required
Lenders shall, by notice to the Borrower, take either or both of
the following actions, at the same or different
times: (i) terminate the Commitments, and thereupon the
Commitments shall terminate immediately, and (ii) declare the
Loans then outstanding to be due and payable in whole (or in
part, in which case any principal not so declared to be due and
payable may thereafter be declared to be due and payable), and
thereupon the principal of the Loans so declared to be due and
payable, together with accrued interest thereon and all fees and
other obligations of the Borrower accrued hereunder, shall become
due and payable immediately, without presentment, demand, protest
or other notice of any kind, all of which are hereby waived by
the Borrower; and in case of any event with respect to the
Borrower described in clause (g) or (h) of this Article, the
Commitments shall automatically terminate and the principal of
the Loans then outstanding, together with accrued interest
thereon and all fees and other obligations of the Borrower
accrued hereunder, shall automatically become due and payable,
without presentment, demand, protest or other notice of any kind,
all of which are hereby waived by the Borrower.
ARTICLE VIII
The Administrative Agent
SECTION 8.01. Appointment, Powers, and Immunities.
Each Lender hereby irrevocably appoints and authorizes the
Administrative Agent to act as its agent under this Agreement
with such powers and discretion as are specifically delegated to
the Administrative Agent by the terms of this Agreement, together
with such other powers as are reasonably incidental thereto. The
Administrative Agent (which term as used in this sentence shall
include its affiliates and its own and its affiliates' officers,
directors, employees, and agents): (a) shall not have any duties
or responsibilities except those expressly set forth in this
Agreement and shall not be a trustee or fiduciary for any Lender;
(b) shall not be responsible to the Lenders for any recital,
statement, representation, or warranty (whether written or oral)
made in or any certificate or other document referred to or
provided for in, or received by any of them under, this
Agreement, or for the value, validity, effectiveness,
genuineness, enforceability, or sufficiency of this Agreement, or
any other document referred to or provided for therein or for any
failure by the Borrower or any other Person to perform any of its
obligations hereunder; (c) shall not be responsible for or have
any duty to ascertain, inquire into, or verify the performance or
observance of any covenants or agreements by the Borrower or the
satisfaction of any condition or to inspect the property
(including the books and records) of the Borrower or any of its
Subsidiaries or affiliates; (d) shall not be required to initiate
or conduct any litigation or collection proceedings under this
Agreement; and (e) shall not be responsible for any action taken
or omitted to be taken by it under or in connection with this
Agreement, except for its own gross negligence or willful
misconduct. The Administrative Agent may employ agents and
<PAGE>
<PAGE> 56
attorneys-in-fact and shall not be responsible for the negligence
or misconduct of any such agents or attorneys-in-fact selected by
it with reasonable care.
SECTION 8.02. Reliance by Administrative Agent. The
Administrative Agent shall be entitled to rely upon any
certification, notice, instrument, writing, or other
communication (including, without limitation, any thereof by
telephone or telecopy) believed by it to be genuine and correct
and to have been signed, sent or made by or on behalf of the
proper Person or Persons, and upon advice and statements of legal
counsel (including counsel for the Borrower), independent
accountants, and other experts selected by the Administrative
Agent. The Administrative Agent may deem and treat the payee of
any note as the holder thereof for all purposes hereof unless and
until the Administrative Agent receives and accepts an Assignment
and Acceptance executed in accordance with Section 9.04 hereof.
As to any matters not expressly provided for by this Agreement,
the Administrative Agent shall not be required to exercise any
discretion or take any action, but shall be required to act or to
refrain from acting (and shall be fully protected in so acting or
refraining from acting) upon the instructions of the Required
Lenders, and such instructions shall be binding on all of the
Lenders; provided, however, that the Administrative Agent shall
not be required to take any action that exposes the
Administrative Agent to personal liability or that is contrary to
this Agreement or applicable law or unless it shall first be
indemnified to its satisfaction by the Lenders against any and
all liability and expense which may be incurred by it by reason
of taking any such action.
SECTION 8.03. Defaults. The Administrative Agent
shall not be deemed to have knowledge or notice of the occurrence
of a Default or Event of Default unless the Administrative Agent
has received written notice from a Lender or the Borrower
specifying such Default or Event of Default and stating that such
notice is a "Notice of Default". In the event that the
Administrative Agent receives such a notice of the occurrence of
a Default or Event of Default, the Administrative Agent shall
give prompt notice thereof to the Lenders. The Administrative
Agent shall take such action with respect to such Default or
Event of Default as shall reasonably be directed by the Required
Lenders, provided that, unless and until the Administrative Agent
shall have received such directions, the Administrative Agent may
(but shall not be obligated to) take such action, or refrain from
taking such action, with respect to such Default or Event of
Default as it shall deem advisable in the best interest of the
Lenders.
SECTION 8.04. Rights as Lender. With respect to its
Commitment and the Loans made by it, NationsBank (and any
successor acting as Administrative Agent) in its capacity as a
Lender hereunder shall have the same rights and powers hereunder
as any other Lender and may exercise the same as though it were
not acting as the Administrative Agent, and the term "Lender" or
"Lenders" shall, unless the context otherwise indicates, include
the Administrative Agent in its individual capacity. NationsBank
(and any successor acting as Administrative Agent) and its
affiliates may (without having to account therefor to any Lender)
accept deposits from, lend money to,
<PAGE>
<PAGE> 57
make investments in, provide services to, and generally engage in
any kind of lending, trust, or other business with the Borrower
or any of its Subsidiaries or affiliates as if it were not acting
as Administrative Agent, and NationsBank (and any successor
acting as Administrative Agent) and its affiliates may accept
fees and other consideration from the Borrower or any of its
Subsidiaries or affiliates for services in connection with this
Agreement or otherwise without having to account for the same to
the Lenders.
SECTION 8.05. Indemnification. The Lenders agree to
indemnify the Administrative Agent (to the extent not reimbursed
under Section hereof, but without limiting the obligations of the
Borrower under such Section) ratably in accordance with their
respective Commitments, for any and all liabilities, obligations,
losses, damages, penalties, actions, judgments, suits, costs,
expenses (including attorneys' fees), or disbursements of any
kind and nature whatsoever that may be imposed on, incurred by or
asserted against the Administrative Agent (including by any
Lender) in any way relating to or arising out of this Agreement
or the transactions contemplated hereby or any action taken or
omitted by the Administrative Agent under this Agreement;
provided that no Lender shall be liable for any of the foregoing
to the extent they arise from the gross negligence or willful
misconduct of the Person to be indemnified. Without limitation
of the foregoing, each Lender agrees to reimburse the
Administrative Agent promptly upon demand for its ratable share
of any costs or expenses payable by the Borrower under Section
9.03, to the extent that the Administrative Agent is not promptly
reimbursed for such costs and expenses by the Borrower. The
agreements contained in this Section shall survive payment in
full of the Loans and all other amounts payable under this
Agreement.
SECTION 8.06. Non-Reliance on Administrative Agent and
Other Lenders. Each Lender agrees that it has, independently and
without reliance on the Administrative Agent or any other Lender,
and based on such documents and information as it has deemed
appropriate, made its own credit analysis of the Borrower and its
Subsidiaries and decision to enter into this Agreement and that
it will, independently and without reliance upon the
Administrative Agent or any other Lender, and based on such
documents and information as it shall deem appropriate at the
time, continue to make its own analysis and decisions in taking
or not taking action under this Agreement. Except for notices,
reports, and other documents and information expressly required
to be furnished to the Lenders by the Administrative Agent
hereunder, the Administrative Agent shall not have any duty or
responsibility to provide any Lender with any credit or other
information concerning the affairs, financial condition, or
business of the Borrower or any of its Subsidiaries or affiliates
that may come into the possession of the Administrative Agent or
any of its affiliates.
SECTION 8.07. Resignation of Administrative Agent.
The Administrative Agent may resign at any time by giving notice
thereof to the Lenders and the Borrower. Upon any such
resignation, the Agents shall have the right to appoint a
successor Administrative Agent from among the Lenders acceptable
to the Required Lenders and the Borrower. If no successor
<PAGE>
<PAGE> 58
Administrative Agent shall have been so appointed by the Agents
and shall have accepted such appointment within thirty (30) days
after the retiring Administrative Agent's giving of notice of
resignation, then the retiring Administrative Agent may, on
behalf of the Lenders, appoint a successor Administrative Agent
which shall be a commercial bank organized under the laws of the
United States of America having combined capital and surplus of
at least $100,000,000. Upon the acceptance of any appointment as
successor Administrative Agent hereunder, such successor shall
thereupon succeed to and become vested with all the rights,
powers, discretion, privileges, and duties of the retiring
Administrative Agent, and the retiring Administrative Agent shall
be discharged from its duties and obligations hereunder. After
any retiring Administrative Agent's resignation hereunder as
Administrative Agent, the provisions of this Article 8 shall
continue in effect for its benefit in respect of any actions
taken or omitted to be taken by it while it was acting as
Administrative Agent.
SECTION 8.08. Agents and Co-Agents. Neither the
Agents nor the co-agents signatories hereto (the "Co-Agents")
shall have any duties or liabilities under this Agreement in
their capacities as such.
ARTICLE IX
Miscellaneous
SECTION 9.01. Notices. Except in the case of notices
and other communications expressly permitted to be given by
telephone, all notices and other communications provided for
herein shall be in writing and shall be delivered by hand or
overnight courier service, mailed by certified or registered mail
or sent by telecopy, as follows:
(a) if to the Borrower, to:
Oryx Energy Company
13155 Noel Road
Dallas, Texas 75240
Attention: Treasurer
Telecopy: 972-715-4304
Telephone: 972-715-4000;
(b) if to the Administrative Agent, the Issuing Bank,
or the Swingline Lender to:
NationsBank of Texas, N.A.
Agency Services
901 Main Street
14th Floor
Dallas, Texas 75202
Attention: Judy Schneidmiller
<PAGE>
<PAGE> 59
Telecopy: 214-508-2118
Telephone: 214-508-2135
(c) if for other notices, to:
NationsBank of Texas, N.A.
Energy Finance Division
901 Main Street
64th Floor
Dallas, Texas 75202
Attention: Denise Smith
Telecopy: 214-508-1285
Telephone: 214-508-1261; and
(d) if to any other Lender, to it at its address (or
telecopy number) set forth on Schedule 2.01.
Any party hereto may change its address or telecopy number for
notices and other communications hereunder by notice to the other
parties hereto. All notices and other communications given to
any party hereto in accordance with the provisions of this
Agreement shall be deemed to have been given on the date of
receipt.
SECTION 9.02. Waivers; Amendments. (a) No failure or
delay by the Administrative Agent, the Issuing Bank or any Lender
in exercising any right or power hereunder shall operate as a
waiver thereof, nor shall any single or partial exercise of any
such right or power, or any abandonment or discontinuance of
steps to enforce such a right or power, preclude any other or
further exercise thereof or the exercise of any other right or
power. The rights and remedies of the Administrative Agent, the
Issuing Bank and the Lenders hereunder are cumulative and are not
exclusive of any rights or remedies that they would otherwise
have. No waiver of any provision of this Agreement or consent to
any departure by the Borrower therefrom shall in any event be
effective unless the same shall be permitted by paragraph (b) of
this Section, and then such waiver or consent shall be effective
only in the specific instance and for the purpose for which
given. Without limiting the generality of the foregoing, the
making of a Loan or issuance of a Letter of Credit shall not be
construed as a waiver of any Default, regardless of whether the
Administrative Agent, any Lender or the Issuing Bank may have had
notice or knowledge of such Default at the time.
(b) Neither this Agreement nor any provision hereof
may be waived, amended or modified except pursuant to an
agreement or agreements in writing entered into by the Borrower
and the Required Lenders or by the Borrower and the
Administrative Agent with the consent of the Required Lenders;
provided that no such agreement shall (i) increase the
Commitment of any Lender without the written consent of such
Lender, (ii) reduce the principal amount of any Loan or LC
Disbursement or reduce the rate of interest thereon, or reduce
any fees payable hereunder, without the written consent of each
Lender affected thereby, (iii) postpone the scheduled date of
payment of
<PAGE>
<PAGE> 60
the principal amount of any Loan or LC Disbursement, or any
interest thereon, or any fees payable hereunder, or reduce the
amount of, waive or excuse any such payment, or postpone the
scheduled date of expiration of any Commitment, without the
written consent of each Lender affected thereby, (iv) change
Section 2.18(b) or (c) in a manner that would alter the pro rata
sharing of payments required thereby, without the written consent
of each Lender, or (v) change any of the provisions of this
Section or the definition of "Required Lenders" or any other
provision hereof specifying the number or percentage of Lenders
required to waive, amend or modify any rights hereunder or make
any determination or grant any consent hereunder, without the
written consent of each Lender; provided further that no such
agreement shall amend, modify or otherwise affect the rights or
duties of the Administrative Agent, the Issuing Bank or the
Swingline Lender hereunder without the prior written consent of
the Administrative Agent, the Issuing Bank or the Swingline
Lender, as the case may be.
SECTION 9.03. Expenses; Indemnity. (a) The Borrower
agrees to pay on demand all reasonable out-of-pocket costs and
expenses of the Agent in connection with the syndication,
preparation, execution, delivery, administration, modification,
and amendment of this Agreement and the other documents to be
delivered hereunder, including, without limitation, the
reasonable fees and expenses of counsel for the Agent (excluding
the cost of internal counsel) with respect thereto and with
respect to advising the Agent as to its rights and
responsibilities under this Agreement. The Borrower further
agrees to pay on demand all costs and expenses of the Agent and
the Lenders, if any (including, without limitation, reasonable
attorneys' fees and expenses, but excluding the cost of internal
counsel), in connection with the enforcement (whether through
negotiations, legal proceedings, or otherwise) of this Agreement
and the other documents to be delivered hereunder.
(b) The Borrower agrees to indemnify and hold harmless the
Agent and each Lender and each of their affiliates and their
respective officers, directors, employees, agents, and advisors
(each, an "Indemnified Party") from and against any and all
claims, damages, losses, liabilities, costs, and expenses
(including, without limitation, reasonable attorneys' fees) that
may be incurred by or asserted or awarded against any Indemnified
Party, in each case arising out of or in connection with or by
reason of (including, without limitation, in connection with any
investigation, litigation, or proceeding or preparation of
defense in connection therewith) this Agreement, any of the
transactions contemplated herein or the actual or proposed use of
the proceeds of the Loans, except to the extent such claim,
damage, loss, liability, cost, or expense results from such
Indemnified Party's gross negligence or willful misconduct or
claims by any of the Lenders against any other Lender (in any
capacity). In the case of an investigation, litigation or other
proceeding to which the indemnity in this Section 9.03 applies,
such indemnity shall be effective whether or not such
investigation, litigation or proceeding is brought by the
Borrower, its directors, shareholders or creditors or an
Indemnified Party or any other Person or any Indemnified Party is
otherwise a party thereto and whether or not the transactions
contemplated hereby are consummated. The Borrower agrees not to
assert any claim against the Agent,
<PAGE>
<PAGE> 61
any Lender, any of their affiliates, or any of their respective
directors, officers, employees, attorneys, agents, and advisers,
on any theory of liability, for special, indirect, consequential,
or punitive damages arising out of or otherwise relating to this
Agreement, any of the transactions contemplated herein or the
actual or proposed use of the proceeds of the Loans.
(c) Without prejudice to the survival of any other
agreement of the Borrower hereunder, the agreements and
obligations of the Borrower contained in this Section 9.03 shall
survive the payment in full of the Loans and all other amounts
payable under this Agreement.
SECTION 9.04. Successors and Assigns. (a) Each
Lender (and, in the case of an assignment of all or a portion of
a Commitment or any Lender's obligations in respect of its LC
Exposure or Swingline Exposure, the Issuing Bank and the
Swingline Lender) may assign to one or more Eligible Assignees
all or a portion of its rights and obligations under this
Agreement (including, without limitation, all or a portion of its
Loans and its Commitment); provided, however, that
(i) each such assignment shall be to an Eligible
Assignee;
(ii) except in the case of an assignment to another
Lender or an assignment of all of a Lender's rights and
obligations under this Agreement, any such partial assignment
shall be in an amount at least equal to $10,000,000; or an
integral multiple of $1,000,000 in excess thereof;
(iii) each such assignment by a Lender shall be of
a constant, and not varying, percentage of all of its rights and
obligations under this Agreement; and
(iv) the parties to such assignment shall execute and
deliver to the Agent for its acceptance an Assignment and
Acceptance in the form of Exhibit A hereto, together with any
note subject to such assignment and a processing fee of $3,500.
Upon execution, delivery, and acceptance of such Assignment and
Acceptance, the assignee thereunder shall be a party hereto and,
to the extent of such assignment, have the obligations, rights,
and benefits of a Lender hereunder and the assigning Lender
shall, to the extent of such assignment, relinquish its rights
and be released from its obligations under this Agreement. Upon
the consummation of any assignment pursuant to this Section, the
assignor, the Agent and the Borrower shall make appropriate
arrangements so that, if required, new notes are issued to the
assignor and the assignee. If the assignee is not incorporated
under the laws of the United States of America or a state
thereof, it shall deliver to the Borrower and the Agent
certification as to exemption from deduction or withholding of
taxes.
(b) The Agent shall maintain at its address referred
to in Section 9.01 a copy of each Assignment and Acceptance
delivered to and
<PAGE>
<PAGE> 62
accepted by it and a register for the recordation of the names
and addresses of the Lenders and the Commitment of, and principal
amount of the Loans owing to, each Lender from time to time (the
"Register"). The entries in the Register shall be conclusive and
binding for all purposes, absent manifest error, and the
Borrower, the Agent and the Lenders may treat each Person whose
name is recorded in the Register as a Lender hereunder for all
purposes of this Agreement. The Register shall be available for
inspection by the Borrower or any Lender at any reasonable time
and from time to time upon reasonable prior notice.
(c) Upon its receipt of an Assignment and Acceptance
executed by the parties thereto, together with any note subject
to such assignment and payment of the processing fee, the Agent
shall, if such Assignment and Acceptance has been completed and
is in substantially the form of Exhibit A hereto, (i) accept such
Assignment and Acceptance, (ii) record the information contained
therein in the Register and (iii) give prompt notice thereof to
the parties thereto.
(d) Each Lender may sell participations to one or more
Persons in all or a portion of its rights and obligations under
this Agreement (including all or a portion of its Commitment and
its Loans); provided, however, that (i) such Lender's obligations
under this Agreement shall remain unchanged, (ii) such Lender
shall remain solely responsible to the other parties hereto for
the performance of such obligations, (iii) the participant shall
be entitled to the benefit of the yield protection provisions
contained in Section 2.16, and (iv) the Borrower shall continue
to deal solely and directly with such Lender in connection with
such Lender's rights and obligations under this Agreement, and
such Lender shall retain the sole right to enforce the
obligations of the Borrower relating to its Loans and to approve
any amendment, modification, or waiver of any provision of this
Agreement (other than amendments, modifications, or waivers
decreasing the amount of principal of or the rate at which
interest is payable on such Loans, extending any scheduled
principal payment date or date fixed for the payment of interest
on such Loans, or extending its Commitment); and provided further
that the participant shall not be entitled to receive any greater
payment under Section 2.15 or 2.17 than the applicable Lender
would have been entitled to receive with respect to the
participation sold to such participant, unless the sale of the
participation to such participant is made with the Borrower's
prior written consent. A participant that would be a Foreign
Lender if it were a Lender shall not be entitled to the benefits
of Section 2.17 unless the Borrower is notified of the
participation sold to such participant and such participant
agrees, for the benefit of the Borrower, to comply with Section
2.17(e) as though it were a Lender.
(e) Notwithstanding any other provision set forth in
this Agreement, any Lender may at any time assign and pledge all
or any portion of its Loans to any Federal Reserve Bank as
collateral security pursuant to Regulation A and any Operating
Circular issued by such Federal Reserve Bank. No such assignment
shall release the assigning Lender from its obligations
hereunder.
<PAGE>
<PAGE> 63
(f) Any Lender may furnish any information concerning
the Borrower or any of its Subsidiaries in the possession of such
Lender from time to time to assignees and participants (including
prospective assignees and participants), subject, however, to the
provisions of Section 9.12 hereof.
SECTION 9.05. Survival. All covenants, agreements,
representations and warranties made by the Borrower herein and in
the certificates or other instruments delivered in connection
with or pursuant to this Agreement shall be considered to have
been relied upon by the other parties hereto and shall survive
the execution and delivery of this Agreement and the making of
any Loans and issuance of any Letters of Credit, regardless of
any investigation made by any such other party or on its behalf
and notwithstanding that the Administrative Agent, the Issuing
Bank or any Lender may have had notice or knowledge of any
Default or incorrect representation or warranty at the time any
credit is extended hereunder, and shall continue in full force
and effect as long as the principal of or any accrued interest on
any Loan or any fee or any other amount payable under this
Agreement is outstanding and unpaid or any Letter of Credit is
outstanding and so long as the Commitments have not expired or
terminated. The provisions of Sections 2.15, 2.16, 2.17 and 9.03
and Article VIII shall survive and remain in full force and
effect regardless of the consummation of the transactions
contemplated hereby, the repayment of the Loans, the expiration
or termination of the Letters of Credit and the Commitments or
the termination of this Agreement or any provision hereof.
SECTION 9.06. Counterparts; Integration;
Effectiveness. This Agreement may be executed in counterparts
(and by different parties hereto on different counterparts), each
of which shall constitute an original, but all of which when
taken together shall constitute a single contract. This
Agreement and any separate letter agreements with respect to fees
payable to the Administrative Agent constitute the entire
contract among the parties relating to the subject matter hereof
and supersede any and all previous agreements and understandings,
oral or written, relating to the subject matter hereof. Except
as provided in Section 4.01, this Agreement shall become
effective when it shall have been executed by the Administrative
Agent and when the Administrative Agent shall have received
counterparts hereof which, when taken together, bear the
signatures of each of the other parties hereto, and thereafter
shall be binding upon and inure to the benefit of the parties
hereto and their respective successors and assigns. Delivery of
an executed counterpart of a signature page of this Agreement by
telecopy shall be effective as delivery of a manually executed
counterpart of this Agreement.
SECTION 9.07. Severability. Any provision of this
Agreement held to be invalid, illegal or unenforceable in any
jurisdiction shall, as to such jurisdiction, be ineffective to
the extent of such invalidity, illegality or unenforceability
without affecting the validity, legality and enforceability of
the remaining provisions hereof; and the invalidity of a
particular provision in a particular jurisdiction shall not
invalidate such provision in any other jurisdiction.
<PAGE>
<PAGE> 64
SECTION 9.08. Right of Setoff. (a) Upon the
occurrence and during the continuance of any Event of Default,
each Lender (and, to the extent permitted by law, each of its
affiliates) is hereby authorized at any time and from time to
time, to the fullest 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 and other indebtedness at
any time owing by such Lender (or, to the extent permitted by
law, any of its affiliates) to or for the credit or the account
of the Borrower against any and all of the obligations of the
Borrower now or hereafter existing under this Agreement,
irrespective of whether such Lender shall have made any demand
under this Agreement and although such obligations may be
unmatured. Each Lender agrees promptly to notify the Borrower
after any such set-off and application made by such Lender;
provided, however, that the failure to give such notice shall not
affect the validity of such set-off and application. The rights
of each Lender under this Section are in addition to other rights
and remedies (including, without limitation, other rights of
set-off) that such Lender may have.
(b) If any Lender (a "benefitted Lender") shall at any
time receive any payment of all or part of the Loans owing to it,
or interest thereon, or receive any collateral in respect thereof
(whether voluntarily or involuntarily, by setoff, or otherwise),
in a greater proportion than any such payment to or collateral
received by any other Lender, if any, in respect of such other
Lender's Loans owing to it, or interest thereon, such benefitted
Lender shall purchase for cash from the other Lenders a
participating interest in such portion of each such other
Lender's Loans owing to it, or shall provide such other Lenders
with the benefits of any such collateral, or the proceeds
thereof, as shall be necessary to cause such benefitted Lender to
share the excess payment or benefits of such collateral or
proceeds ratably with each of the Lenders; provided, however,
that if all or any portion of such excess payment or benefits is
thereafter recovered from such benefitted Lender, such purchase
shall be rescinded, and the purchase price and benefits returned,
to the extent of such recovery, but without interest. The
Borrower agrees that any Lender so purchasing a participation
from a Lender pursuant to this Section may, to the fullest extent
permitted by law, exercise all of its rights of payment
(including the right of set-off) with respect to such
participation as fully as if such Person were the direct creditor
of the Borrower in the amount of such participation.
SECTION 9.09. GOVERNING LAW; SUBMISSION TO
JURISDICTION; VENUE. (A) THIS AGREEMENT AND THE RIGHTS AND
OBLIGATIONS OF THE PARTIES HEREUNDER SHALL BE CONSTRUED IN
ACCORDANCE WITH AND BE GOVERNED BY THE LAW OF THE STATE OF NEW
YORK. CHAPTER 15 OF TEXAS REVISED CIVIL STATUTES ARTICLE 5069
(WHICH REGULATES CERTAIN REVOLVING CREDIT LOAN ACCOUNTS AND
REVOLVING TRI-PARTY ACCOUNTS) SHALL NOT APPLY TO THIS AGREEMENT.
ANY LEGAL ACTION OR PROCEEDING AGAINST THE BORROWER WITH RESPECT
TO THIS AGREEMENT MAY BE BROUGHT IN THE COURTS OF THE STATE OF
NEW YORK OR OF THE UNITED STATES FOR THE SOUTHERN
<PAGE>
<PAGE> 65
DISTRICT OF NEW YORK AND APPELLATE COURTS FROM ANY THEREOF, AND,
BY EXECUTION AND DELIVERY OF THIS AGREEMENT, THE BORROWER HEREBY
IRREVOCABLY ACCEPTS FOR ITSELF AND IN RESPECT OF ITS PROPERTY,
GENERALLY AND UNCONDITIONALLY, THE JURISDICTION OF THE AFORESAID
COURTS. THE BORROWER HEREBY IRREVOCABLY DESIGNATES, APPOINTS AND
EMPOWERS CT CORPORATION SYSTEM, WITH OFFICES ON THE DATE HEREOF
AT 1633 BROADWAY, NEW YORK, NEW YORK 10019, AS ITS DESIGNEE,
APPOINTEE AND AGENT TO RECEIVE, ACCEPT AND ACKNOWLEDGE FOR AND ON
ITS BEHALF, AND IN RESPECT OF ITS PROPERTY, SERVICE OF ANY AND
ALL LEGAL PROCESS, SUMMONS, NOTICES AND DOCUMENTS WHICH MAY BE
SERVED IN ANY SUCH ACTION OR PROCEEDING. IF FOR ANY REASON SUCH
DESIGNEE, APPOINTEE AND AGENT SHALL CEASE TO BE AVAILABLE TO ACT
AS SUCH, THE BORROWER AGREES TO DESIGNATE A NEW DESIGNEE,
APPOINTEE AND AGENT IN NEW YORK CITY ON THE TERMS AND FOR THE
PURPOSES OF THIS PROVISION SATISFACTORY TO THE ADMINISTRATIVE
AGENT. THE BORROWER FURTHER IRREVOCABLY CONSENTS TO THE SERVICE
OF PROCESS OUT OF ANY OF THE AFOREMENTIONED COURTS IN ANY SUCH
ACTION OR PROCEEDING BY THE MAILING OF COPIES THEREOF BY
REGISTERED OR CERTIFIED MAIL, POSTAGE PREPAID, TO THE BORROWER AT
ITS ADDRESS SET FORTH OPPOSITE ITS SIGNATURE BELOW, SUCH SERVICE
TO BECOME EFFECTIVE 30 DAYS AFTER SUCH MAILING. NOTHING HEREIN
SHALL AFFECT THE RIGHT OF THE ADMINISTRATIVE AGENT, ANY CO-AGENT,
ANY BANK OR THE HOLDER OF ANY OBLIGATION OWING HEREUNDER TO SERVE
PROCESS IN ANY OTHER MANNER PERMITTED BY LAW OR TO COMMENCE LEGAL
PROCEEDINGS OR OTHERWISE PROCEED AGAINST THE BORROWER IN ANY
OTHER JURISDICTION.
(B) THE BORROWER HEREBY IRREVOCABLY WAIVES ANY
OBJECTION WHICH IT MAY NOW OR HEREAFTER HAVE TO THE LAYING OF
VENUE OF ANY OF THE AFORESAID ACTIONS OR PROCEEDINGS ARISING OUT
OF OR IN CONNECTION WITH THIS AGREEMENT BROUGHT IN THE COURTS
REFERRED TO IN CLAUSE (A) ABOVE AND HEREBY FURTHER IRREVOCABLY
WAIVES AND AGREES NOT TO PLEAD OR CLAIM IN ANY SUCH COURT THAT
ANY SUCH ACTION OR PROCEEDING BROUGHT IN ANY SUCH COURT HAS BEEN
BROUGHT IN AN INCONVENIENT FORUM.
(C) EACH PARTY HERETO HEREBY IRREVOCABLY WAIVES, TO
THE MAXIMUM EXTENT NOT PROHIBITED BY LAW, ANY RIGHT IT MAY HAVE
TO CLAIM OR RECOVER IN ANY LEGAL ACTION OR PROCEEDING REFERRED TO
IN THIS SECTION 9.09 ANY SPECIAL, EXEMPLARY, PUNITIVE OR
CONSEQUENTIAL DAMAGES.
<PAGE>
<PAGE> 66
SECTION 9.10. WAIVER OF JURY TRIAL. EACH PARTY
HERETO HEREBY WAIVES, TO THE FULLEST EXTENT PERMITTED BY
APPLICABLE LAW, ANY RIGHT IT MAY HAVE TO A TRIAL BY JURY IN ANY
LEGAL PROCEEDING DIRECTLY OR INDIRECTLY ARISING OUT OF OR
RELATING TO THIS AGREEMENT OR THE TRANSACTIONS CONTEMPLATED
HEREBY (WHETHER BASED ON CONTRACT, TORT OR ANY OTHER THEORY).
EACH PARTY HERETO (A) CERTIFIES THAT NO REPRESENTATIVE, AGENT OR
ATTORNEY OF ANY OTHER PARTY HAS REPRESENTED, EXPRESSLY OR
OTHERWISE, THAT SUCH OTHER PARTY WOULD NOT, IN THE EVENT OF
LITIGATION, SEEK TO ENFORCE THE FOREGOING WAIVER AND
(B) ACKNOWLEDGES THAT IT AND THE OTHER PARTIES HERETO HAVE BEEN
INDUCED TO ENTER INTO THIS AGREEMENT BY, AMONG OTHER THINGS, THE
MUTUAL WAIVERS AND CERTIFICATIONS IN THIS SECTION.
SECTION 9.11. Headings. Article and Section headings
and the Table of Contents used herein are for convenience of
reference only, are not part of this Agreement and shall not
affect the construction of, or be taken into consideration in
interpreting, this Agreement.
SECTION 9.12. Confidentiality. Each of the
Administrative Agent, the Issuing Bank and the Lenders agrees to
maintain the confidentiality of the Information (as defined
below), except that Information may be disclosed (a) to its and
its Affiliates' directors, officers, employees and agents,
including accountants, legal counsel and other advisors (it being
understood that the Persons to whom such disclosure is made will
be informed of the confidential nature of such Information and
instructed to keep such Information confidential), (b) to the
extent requested by any regulatory authority, (c) to the extent
required by applicable laws or regulations or by any subpoena or
similar legal process, (d) to any other party to this Agreement,
(e) in connection with the exercise of any remedies hereunder or
any suit, action or proceeding relating to this Agreement or the
enforcement of rights hereunder, (f) subject to an agreement
containing provisions substantially the same as those of this
Section, to any assignee of or Participant in, or any prospective
assignee of or Participant in, any of its rights or obligations
under this Agreement, (g) with the consent of the Borrower or
(h) to the extent such Information (i) becomes publicly available
other than as a result of a breach of this Section or
(ii) becomes available to the Administrative Agent, the Issuing
Bank or any Lender on a nonconfidential basis from a source other
than the Borrower. For the purposes of this Section,
"Information" means all information received from the Borrower
relating to the Borrower or its business, other than any such
information that is available to the Administrative Agent, the
Issuing Bank or any Lender on a nonconfidential basis prior to
disclosure by the Borrower; provided that, in the case of
information received from the Borrower after the date hereof,
such information is clearly identified at the time of delivery as
confidential. Any Person required to maintain the
confidentiality of Information as provided in this Section shall
be considered to have complied with its obligation to do so if
such Person has exercised the same degree of
<PAGE>
<PAGE> 67
care to maintain the confidentiality of such Information as such
Person would accord to its own confidential information.
SECTION 9.13. Interest. (a) It is the intention of
the parties hereto that each Lender shall conform strictly to
usury laws applicable to it. Accordingly, the parties hereto
stipulate and agree that none of the terms and provisions
contained in this Agreement shall ever be construed to create a
contract to pay to any Lender for the use, forbearance, or
dedentition of money at a rate in excess of the Highest Lawful
Rate applicable to such Lender, and that for purposes hereof,
"interest" shall include the aggregate of all charges or other
consideration which constitute interest under applicable laws and
are contracted for, taken, reserved, charged, or received under
this Agreement or otherwise in connection with the transactions
contemplated by this Agreement. Further, if the transactions
contemplated hereby would be usurious as to any Lender under laws
applicable to it, then, in that event, notwithstanding anything
to the contrary in this Agreement or any other agreement entered
into in connection with or as security for the Loans, it is
agreed as follows: the aggregate of all consideration which
constitutes interest under law applicable to each such Lender
that is contracted for, taken, reserved, charged, or received by
such Lender under this Agreement or under any of the other
aforesaid agreements or otherwise in connection with this
Agreement shall under no circumstances exceed the maximum amount
allowed by the law applicable to such Lender, and any excess
shall be credited by such Lender on the principal amount of the
Indebtedness of the Borrower owed to such Lender (or, if the
principal amount of such Indebtedness shall have been paid in
full, to the extent such interest has been received by a Lender
it shall be refunded by such Lender to the Borrower). The
provisions of this Section 9.13(a) shall control over all other
provisions of this Agreement which may be in apparent conflict
herewith. The parties further stipulate and agree that, without
limitation on the foregoing, all calculations of the rate or
amount of interest contracted for, taken, reserved, charged or
received under any of this Agreement which are made for the
purpose of determining whether such rate or amount exceed the
Highest Lawful Rate shall be made, to the extent permitted by
applicable law, by amortizing, prorating, allocating, and
spreading during the period of the full stated term of the
Indebtedness, and if longer and if permitted by applicable law,
until payment in full, all interest at any time so contracted
for, taken, reserved, charged, or received.
(b) If at any time the effective rate of interest
which would otherwise apply to any Indebtedness arising under
this Agreement would exceed the Highest Lawful Rate applicable to
any Lender (taking into account the interest rate applicable to
such Indebtedness pursuant to the other provisions of this
Agreement, plus all additional charges and consideration which
have been contracted for, taken, reserved, charged, or received
under this Agreement, or any of them, and which additional
charges or consideration (the "Additional Charges") constitute
interest with respect to such Indebtedness), the effective
interest rate to apply to such Indebtedness made by such Lender
shall be limited to the Highest Lawful Rate, but any subsequent
reductions in the interest rate applicable to such Indebtedness
owed to such Lender shall not reduce the effective interest rate
to apply to such Indebtedness owed to
<PAGE>
<PAGE> 68
such Lender below the Highest Lawful Rate applicable to such
Lender until the total amount of interest accrued on such
Indebtedness equals the amount of interest which would have
accrued if the interest rate from time to time applicable to such
Indebtedness owed to such Lender had at all times been in effect
with respect to such Indebtedness pursuant to other provisions of
this Agreement and if the Lenders had collected all Additional
Charges called for under this Agreement. If at maturity or final
payment of such Lender's Loans and all the amounts owed pursuant
to this Agreement, the total amount of interest accrued under
this Agreement on such Lender's Loans (including amounts
designated as "interest" plus any Additional Charges which
constitute interest with respect to amounts owed hereunder, and
taking into account the limitations of the first sentence of this
Section 9.13(b)) is less than the total amount of interest which
would have accrued if the interest rate or interest rates
applicable to the Indebtedness from time to time outstanding
hereunder had at all times been in effect pursuant to the other
provisions of this Agreement, then the Borrower agrees, to the
fullest extent permitted by the laws applicable to such Lender,
to pay to such Lender an amount equal to the difference between
(i) the lesser of (1) the amount of interest which would have
accrued hereunder on such Lender's Loans if the Highest Lawful
Rate had at all times been in effect (but excluding, for purposes
of calculating such amount of interest, any Additional Charges
which constitute interest with respect to such Lender's Loans) or
(2) the amount of interest which would have accrued hereunder on
such Lender's Loans if the interest rate or interest rates
applicable to the Indebtedness from time to time outstanding
hereunder had at all times been in effect pursuant to the other
provisions of this Agreement (including amounts designated as
"interest" plus any Additional Charges which constitute interest
with respect to this Agreement) less (ii) the amount of interest
actually accrued hereunder on such Lender's Loans (including
amounts designated as "interest" plus any Additional Charges
which constitute interest with respect to such Lender's Loans).
SECTION 9.14. Existing Credit Agreement. The
Borrower and each of the Original Lenders hereby agree that the
commitments under the Existing Credit Agreement shall, effective
upon the Effective Date, be automatically and immediately
terminated. In connection with the foregoing, each of the
Original Lenders (the Original Lenders constituting, in the
aggregate, the "Required Banks" under and as defined in the
Existing Credit Agreement) hereby agrees to waive the requirement
that the Borrower provide notice of such termination under
Section 2.02 of the Existing Credit Agreement. Notwithstanding
the foregoing, on the Effective Date, (i) all "Bid Loans" (under
and as defined in the Existing Credit Agreement) of an Original
Lender outstanding under the Existing Credit Agreement (A) shall
remain outstanding until the maturity of such Bid Loans in
accordance with the terms of such Bid Loans under the Existing
Credit Agreement, provided that such Bid Loans may not be
extended, renewed or reborrowed and no Bid Loan shall mature
later than October 27, 1997, and (B) shall remain subject to and
be payable under the terms of and in accordance with the Existing
Credit Agreement; provided, however, any Bid Loans remaining
outstanding under the Existing Credit Agreement shall be included
for purposes of determining the total Commitments under this
Agreement and (ii) any Continuing Letters of Credit listed on
Schedule 3.14 shall become Letters of Credit hereunder. From and
after the
<PAGE>
<PAGE> 69
Effective Date, no Original Lender which was party to the
Existing Credit Agreement but which will not become party to this
Agreement (each, an "Exiting Lender") shall have any obligations
or liabilities under this Agreement with respect to the
Continuing Letters of Credit and, without limiting the foregoing,
no Exiting Lender shall have any participating interest in any
such Continuing Letter of Credit. The Lenders hereby confirm
that, from and after the Effective Date, all participations of
the Lenders in respect of Letters of Credit (including Continuing
Letters of Credit) outstanding hereunder pursuant to subsection
2.06(d) shall be based upon the Applicable Percentages of the
Lenders.
SECTION 9.15. Judgment in a Currency Other Than
Dollars. The obligations of the Borrower hereunder to make
payments in Dollars shall not be discharged or satisfied by any
tender or recovery pursuant to any judgment expressed in or
converted into any currency other than Dollars except to the
extent to which such tender or recovery shall result in the
effective receipt by the Lenders of the full amount of the
Dollars expressed to be payable hereunder, and accordingly such
primary obligations of the Borrower shall be enforceable as an
alternative or additional cause of action for the purpose of
recovery in Dollars of the amount (if any) by which such
effective receipt shall fall short of the full amount of the
Dollars expressed to be payable hereunder and shall not be
effected by judgment being obtained for any other sums due under
this Agreement.
<PAGE>
<PAGE> 70
IN WITNESS WHEREOF, the parties hereto have caused this
Agreement to be duly executed by their respective authorized
officers as of the day and year first above written.
ORYX ENERGY COMPANY
By: /s/ Steven J. Flowers
Title: Vice President & Treasurer
NATIONSBANK OF TEXAS, N.A.,
Administrative Agent and as a Lender
By: /s/ Denise A. Smith
Title: Senior Vice President
NATIONSBANC MONTGOMERY
SECURITIES, INC., as Arranger
By: /s/ David E. Hunt
Title: Managing Director
BARCLAYS BANK PLC, as
Documentation Agent and as a Lender
By: /s/ Joseph Onischuk
Title: Associate Director
CHASE SECURITIES INC., as
Syndication Agent
By: /s/ Thomas H. Kozlark
Title: Vice President
<PAGE>
<PAGE> 71
THE CHASE MANHATTAN BANK, as a
Lender
By: /s/ Ronald Potter
Title: Managing Director
BANK OF AMERICA NT & SA, as
Co-Agent and as a Lender
By: /s/ Michael J. Dillon
Title: Managing Director
BANK OF MONTREAL, as Co-Agent and
as a Lender
By: /s/ Michael P. Stuckey
Title: Managing Director, U.S.
Corporate Banking
THE BANK OF NEW YORK, as
Co-Agent and as a Lender
By: /s/ John Watt
Title: Vice President
THE BANK OF TOKYO-MITSUBISHI,
LTD., HOUSTON AGENCY, as
Co-Agent and as a Lender
By: /s/ Michael Meiss
Title: Vice President
CITIBANK N.A., as Co-Agent
and as a Lender
By: /s/ David L. Harris
Title: Vice President
<PAGE>
<PAGE> 72
THE INDUSTRIAL BANK OF JAPAN,
LIMITED, as Co-Agent and as
a Lender
By: /s/ Kazutoshi Kuwahara
Title: Executive Vice President,
Houston Office
ROYAL BANK OF CANADA, as
Co-Agent and as a Lender
By: /s/ Gil Bernard
Title: Senior Manager
CAISSE NATIONALE DE CREDIT
AGRICOLE
By: /s/ Dean Balice
Title: Senior Vice President
DEN NORSKE BANK ASA
By: /s/ J. Morten Kreutz
Title: Vice President
DEN NORSKE BANK ASA
By: /s/ Byron L. Cooley
Title: Senior Vice President
THE FUJI BANK, LTD. HOUSTON
AGENCY
By: /s/ Yoshiaki Inoue
Title: Vice President & Manager
<PAGE>
<PAGE> 73
THE LONG-TERM CREDIT BANK
OF JAPAN, LIMITED
By: /s/ Sadao Muraoka
Title: Head of Southwest Region
WELLS FARGO BANK
By: /s/ Lester J. N. Keliher
Title: Vice President
BANK OF SCOTLAND
By: /s/ Annie Chin Tat
Title: Vice President
BANQUE PARIBAS
By: /s/ Michael H. Fiuzat
Title: Vice President
BANQUE PARIBAS
By: /s/ Larry Robinson
Title: Vice President
CREDIT LYONNAIS NEW YORK
BRANCH
By: /s/ Pascal Poupelle
Title: Executive Vice President
CREDIT SUISSE FIRST BOSTON
By: /s/ James Moran
Title: Director
<PAGE>
<PAGE> 74
CREDIT SUISSE FIRST BOSTON
By: /s/ Eric J. Eckholdt
Title: Associate
THE DAI-ICHI KANGYO BANK,
LIMITED
By: /s/ Masaaki Ishikura
Title: Vice President
MORGAN GUARANTY TRUST
COMPANY OF NEW YORK
By: /s/ John Kowalczuk
Title: Vice President
HSBC INVESTMENT BANK PLC
By: /s/ John A. Cleveland
Title: Managing Director
THE MITSUBISHI TRUST &
BANKING CORPORATION CHICAGO
BRANCH
By: /s/ Hachiro Hosoda
Title: Deputy General Manager
THE SANWA BANK, LIMITED
By: /s/ Matthew G. Patrick
Title: Vice President
THE SUMITOMO BANK, LIMITED
By: /s/ Reigi Sato
Title: Joint General Manager
<PAGE>
Schedule 2.01
Total Amount
Name and Address of Bank of Commitment
Nationsbank of Texas, N.A. $32,660,000.00
Credit Contact: Denise Smith
901 Main Street - 64th Floor
Dallas, Texas 75202
Telephone: 214-508-1261
Telecopy: 214-508-1285
Operations Contact: Judy Schneidmiller
Telephone: 214-508-2135
Telecopy: 214-508-2118
Barclays Bank Plc $32,660,000.00
Credit Contact: Darryl Neider
Director
222 Broadway
New York, New York 10038
Telephone: 212-412-1306
Telecopy: 212-412-7585
Operations Contact: Anand Chan-Sui
75 Wall Street, 12th Floor
New York, NY 10265
Telephone: 212-412-3702
Telecopy: 212-412-5306
The Chase Manhattan Bank, N.A. $32,660,000.00
Credit Contact: Donna German
Senior Vice President
2200 Ross Avenue
Dallax, TX 75201
Telephone: 214-965-2540
Telecopy: 214-965-2389
Operations Contact: Lynette Lang
1 Chase Manhattan Plaza
8th Floor
New York, NY 10081
Telephone: 212-552-7692
Telecopy: 212-552-5777
<PAGE>
<PAGE> 2
Total Amount
Name and Address of Bank of Commitment
CO-AGENTS
Bank of America NT & SA $26,000,000.00
Credit Contact: Mike Dillon
333 Clay Street, Suite 4550
Houston, Texas 77002
Telephone: 713-651-4903
Telecopy: 713-651-4808
Operations Contact: Debbie Aguilar
Account Administrator
231 South LaSalle
Chicago, IL 60697
Telephone: 312-828-3793
Telecopy: 312-974-9626
Bank of Montreal $26,000,000.00
Credit Contact: Anne Marie Goodwin
700 Louisiana
Suite 4400
Houston, Texas 77002
Telephone: 713-546-9724
Telecopy: 713-223-4007
Operations Contact: Charlo Chase
Client Services Officer
115 S. LaSalle
11th Floor West
Chicago, IL 60603
Telephone: 312-750-4326
Telecopy: 312-750-6061
The Bank of New York $26,000,000.00
Credit Contact: Raymond J. Palmer
One Wall Street - 19th Floor
New York, New York 10286
Telephone: 212-635-7834
Telecopy: 212-635-7923
Operations Contact: Kathy D'Elena
Telephone: 212-635-7550
Telecopy: 212-635-7923
<PAGE>
<PAGE> 3
Total Amount
Name and Address of Bank of Commitment
The Bank of Tokyo-Mitsubishi, $26,000,000.00
Ltd., Houston Agency
Credit Contact: Donna Breland
Assistant Vice President
1100 Louisiana St., Suite 2800
Houston, Texas 77002
Telephone: 713-655-3810
Telecopy: 713-655-3855
Operations Contact: Nadra Breir
Loan Assistant
Telephone: 713-655-3847
Telecopy: 713-655-0116
Citibank N.A. $26,000,000.00
Credit Contact: Don Miller
1200 Smith Street, Suite 2000
Houston, TX 77002
Telephone: 713-654-2962
Telecopy: 713-654-2849
Operations Contact: Kate Bohen
Loan Administrator
2 Penns Way
New Castle, DE
Telephone: 302-894-6077
Telecopy: 302-894-6120
The Industrial Bank of $26,000,000.00
Japan, Limited
Credit Contact: David Fox
Vice President
Three Allen Center
Suite 4850
333 Clay Street
Houston, TX 77002
Telephone: 713-651-9444 ext.102
Telecopy: 713-651-9202
Operations Contact: Atsushi Kawai
1251 Avenue of the Americas
New York, NY 10020-1104
Telephone: 212-282-4060
Telecopy: 212-282-4480/282-4250
<PAGE>
<PAGE> 4
Total Amount
Name and Address of Bank of Commitment
Royal Bank of Canada $26,000,000.00
Credit Contact: Gil J. Benard
12450 Greenspoint Dr., Suite 1450
Houston, TX 77060
Telephone: 281-874-5662
Telecopy: 281-874-0081
Operations Contact: Asst. Manager, Loan Processing
1 Financial Square, 23rd Floor
New York, NY 10005-3531
Telephone: 212-428-6321
Telecopy: 718-428-2372
PARTICIPANTS
Caisse Nationale de Credit $20,000,000.00
Agricole
Credit Contact: Brian D. Knezeak
600 Travis St., Suite 2340
Houston, TX 77002
Telephone: 713-223-7000
Telecopy: 713-223-7029
Operations Contact: Karen Bergstrom
55 E. Monroe, Suite 4700
Chicago, IL 60603
Telephone: 312-917-7420
Telecopy: 312-372-2628
Den Norske Bank ASA $20,000,000.00
Credit Contact: J. Morten Kreutz
Three Allen Center
333 Clay Street
Houston, Texas 77002
Telephone: 713-844-9254
Telecopy: 713-757-1167
Operations Contact: Alberto Caceda
Telephone: 212-681-3843
Telecopy: 212-681-4123
<PAGE>
<PAGE> 5
Total Amount
Name and Address of Bank of Commitment
The Fuji Bank, Ltd. Houston Agency $20,000,000.00
Credit Contact: Tommy Watts
Vice President
1 Houston Center
121 McKinney St., Suite 4100
Houston, Texas 77010
Telephone: 713-650-7868
Telecopy: 713-759-0048
Operations Contact: Frances Flores / Jenny Lin
Telephone: 713-650-7823 / 713-650-7821
Telecopy: 713-951-0590
The Long-Term Credit Bank of $20,000,000.00
Japan, Limited
Credit Contact: Doug Whiddon
2200 Ross Avenue
Suite 4700 West
Dallas, Texas 75201
Telephone: 214-969-5352
Telecopy: 214-969-5357
Operations Contact: Robert Pacifici
165 Broadway
New York, New York 10006
Telephone: 212-335-4801
Telecopy: 212-608-3452
Wells Fargo Bank $20,000,000.00
Credit Contact: Lester Kelliher
1445 Ross Avenue, Suite 400
Dallas, TX 75202
Telephone: 214-777-4025
Telecopy: 214-777-4044
Operations Contact: Same as above
<PAGE>
<PAGE> 6
Total Amount
Name and Address of Bank of Commitment
Bank of Scotland $12,000,000.00
Credit Contact: Janna Blanter
Vice President
1200 Smith Street
Suite 1750
Houston, Texas 77002
Telephone: 713-651-1870
Telecopy: 713-651-9714
Operations Contact: Janet Taffe
Assistant Vice President
565 Fifth Avenue
New York, New York 10017
Telephone: 212-450-0872
Telecopy: 212-557-9460
Banque Paribas $12,000,000.00
Credit Contact: Mike Fiuzar
Vice President
1200 Smith # 3100
Houston, TX 77002
Telephone: 713-659-4811
Telecopy: 713-659-6915
Operations Contact: Leah Evans-Hughes
Operations Officer
1200 Smith Street, Suite 3100
Houston, Texas 77002
Telephone: 713-659-4811
Telecopy: 713-659-5303
Credit Lyonnais New York Branch $12,000,000.00
Credit Contact: Christing Smith-Byerly
1000 Louisiana, Suite 5360
Houston, TX 77002
Telephone: 716-753-8720
Telecopy: 716-751-0307
Operations Contact: Bernadette Archie
Telephone: 713-753-8702
Telecopy: 713-751-0307
<PAGE>
<PAGE> 7
Total Amount
Name and Address of Bank of Commitment
Credit Suisse First Boston $12,000,000.00
Credit Contact: James Moran
Director
11 Madison Avenue
New York, NY 10010
Telephone: 212-325-9176
Telecopy: 212-325-8314
Operations Contact: Matthew Wilson
Telephone: 212-325-0303
Telecopy: 212-325-6508
The Dai-Ichi Kangyo Bank, $12,000,000.00
Limited
Credit Contact: Warren R. Ross
1100 Louisiana, Suite 4940
Houston, TX 77002
Telephone: 713-654-5055
Telecopy: 713-654-1667
Operations Contact: Christine Dell'Aira
Telephone: 212-432-8841
Telecopy: 212-912-1879
Morgan Guaranty Trust Company $12,000,000.00
of New York
Credit Contact: John Kowalczuk
Vice President
60 Wall Street
New York, New York 10260
Telephone: 212-648-7612
Telecopy: 212-648-5014
Operations Contact: Sandra Doherty
500 Stanton Christiana Road
3/OPS2 MCC
Newark, Delaware 19713-2107
Telephone: 302-634-8122
Telecopy: 302-634-1092
<PAGE>
<PAGE> 8
Total Amount
Name and Address of Bank of Commitment
HSBC Investment Bank plc $12,000,000.00
Credit Contact: John A. Cleveland
Executive Director
140 Broadway, 5th Floor
New York, New York 10005
Telephone: 212-658-2702
Telecopy: 212-658-2580
Operations Contact: Dennis Mason
Thames Exchange
10 Queen St. Place
London EC4R1BL
Telephone: 011 44 171 336 9292
Telecopy: 011 44 171 336 9293
The Mitsubishi Trust & $12,000,000.00
Banking Corporation Chicago Branch
Credit Contact: Chris Strike
Corporate Finance Officer
311 S. Wacker Dr., Suite 6300
Chicago, Illinois 60606
Telephone: 312-408-6015
Telecopy: 312-663-0863
Operations Contact: Carmen Lopez
Telephone: 312-408-6022
Telecopy: 312-408-0170
The Sanwa Bank, Limited $12,000,000.00
Credit Contact: Pamela Beal
Banking Officer
4100 W Texas Commerce Tower
2200 Ross Avenue
Dallas, TX 75202
Telephone: 214-665-0242
Telecopy: 214-953-3963
Operations Contact: Renko Hara
55 East 52nd Street
New York, NY 10055
Telephone: 212-339-3084
Telecopy: 212-754-3084
<PAGE>
<PAGE> 9
Total Amount
Name and Address of Bank of Commitment
The Sumitomo Bank, Limited $12,000,000.00
Credit Contact: Energy Group
700 Louisiana St., Suite 1750
Houston, TX 77002
Telephone: 713-238-8200
Telecopy: 713-759-0020
Operations Contact: Jessica Cueto
Telephone: 212-224-4132
Telecopy: 212-224-4537
_______________
Total Facility $500,000,000.00
<PAGE>
SCHEDULE 3.01
ORYX ENERGY COMPANY SUBSIDIARIES
<TABLE>
<C> <C>
Place of Percentage
<S> Incorporation/ Ownership by the
Company Name Registration Company or one of
its Subsidiaries
Antelope Insurance Co. Ltd. Bermuda 99.99%
Oryx Algerie Energy Company Cayman Islands 100%
Oryx Algerie (Mehaiguene) Company Cayman Islands 100%
Oryx Canada Energy Company Delaware 100%
Oryx Crude Trading & Transportation, Inc. Delaware 100%
Oryx Ecuador Energy Company Delaware 100%
Oryx Eurasian Pipeline Company Delaware 100%
Oryx Caspian Pipeline, L.L.C. Delaware 99.0%
Oryx Gas Marketing Company Delaware 100%
Oryx Indonesia Energy Company Delaware 100%
Oryx International Energy Company Cayman Islands 100%
Oryx Kazakhstan Energy Company Delaware 100%
Oryx Kazakhstan (Arman) Energy Company Delaware 100%
Oryx Mexico Energy Company Delaware 100%
Oryx NW Shelf Australia Energy Pty Ltd Western Australia 100%
Oryx Pipe Line Company Delaware 100%
Oryx Services Company Delaware 100%
Oryx U.K. Energy Company Delaware 100%
Oryx U.K. (Italy) Energy Limited United Kingdom 99.99%
Oryx (ZOC) Energy Pty Ltd Western Australia 100%
Sun Energy Partners, L.P. Delaware 98%
Oryx Crude Trading & Transportation
Limited Partnership Delaware *
Oryx Gas Marketing Limited Partnership Delaware *
Oryx Pipe Line Limited Partnership Delaware *
Sun Offshore Gathering Limited
Partnership Delaware *
Sun Operating Limited Partnership Delaware *
Oryx Development Limited
Partnership Delaware *
Oryx Development - II, L.P. Delaware *
Sun Pennsylvania Limited Partnership Delaware *
Sun Exploration and Production Company
of Pennsylvania, Inc. Pennsylvania 100%
Sun Offshore Gathering Company Delaware 100%
</TABLE>
* 99% limited partnership interest owned by Sun Energy Partners,
L.P., 1% general partnership interest owned by Oryx Energy
Company or one of its corporate subsidiaries.
<PAGE>
SCHEDULE 3.14
CONTINUING LETTERS OF CREDIT
Amount Issuing Bank Beneficiary
$26,055,720 Barclays Bank PLC Three Galleria Tower Venture
<PAGE>
EXHIBIT A
ASSIGNMENT AND ACCEPTANCE
Reference is made to the Credit Agreement dated as of
October __, 1997 (the "Credit Agreement") among ORYX ENERGY
COMPANY, a Delaware corporation (the "Borrower"), the several
banks and other financial institutions from time to time parties
thereto (the "Lenders"), NATIONSBANC CAPITAL MARKETS, INC., as
Arranger (in such capacity, the "Arranger"), CHASE SECURITIES
INC., as Syndication Agent (in such capacity, the "Syndication
Agent"), BZW, the investment banking division of Barclays Bank
PLC, as Documentation Agent (in such capacity, the "Documentation
Agent") and NATIONSBANK OF TEXAS, N.A., as administrative agent
for the Lenders (the "Administrative Agent"). Terms defined in
the Credit Agreement are used herein with the same meaning.
The "Assignor" and the "Assignee" referred to on Schedule 1
agree as follows:
1. The Assignor hereby sells and assigns to the Assignee,
without recourse and without representation or warranty except as
expressly set forth herein, and the Assignee hereby purchases and
assumes from the Assignor, an interest in and to the Assignor's
rights and obligations under the Credit Agreement as of the date
hereof equal to the percentage interest specified on Schedule 1
of all outstanding rights and obligations under the Credit
Agreement. After giving effect to such sale and assignment, the
Assignee's Commitment and the amount of the Loans owing to the
Assignee will be as set forth on Schedule 1.
2. The Assignor (i) represents and warrants that it is the
legal and beneficial owner of the interest being assigned by it
hereunder and that such interest is free and clear of any adverse
claim; (ii) makes no representation or warranty and assumes no
responsibility with respect to any statements, warranties or
representations made in or in connection with the Credit
Agreement or the execution, legality, validity, enforceability,
genuineness, sufficiency or value of the Credit Agreement or any
other instrument or document furnished pursuant thereto; and
(iii) makes no representation or warranty and assumes no
responsibility with respect to the financial condition of the
Borrower or any of its Subsidiaries or the performance or
observance by the Borrower or any of its Subsidiaries of any of
its obligations under the Credit Agreement or any other
instrument or document furnished pursuant thereto.
3. The Assignee (i) confirms that it has received a copy
of the Credit Agreement, together with copies of the financial
statements referred to in Section 5.01 thereof and such other
documents and information as it has deemed appropriate to make
its own credit analysis and decision to enter into this
Assignment and Acceptance; (ii) agrees that it will,
independently and without reliance upon the Administrative Agent,
the Assignor or any other Lender and based on such documents and
information as it shall deem appropriate at the time, continue to
make its own credit decisions in taking or not taking action
under the Credit Agreement; (iii) confirms that it is an Eligible
Assignee; (iv) appoints and authorizes the Administrative Agent
to take such action as agent on its behalf and to exercise such
powers and discretion under the Credit Agreement as are delegated
to the Administrative Agent by the terms thereof, together with
such powers and discretion as are
<PAGE>
<PAGE> 2
reasonably incidental thereto; (v) agrees that it will perform in
accordance with their terms all of the obligations that by the
terms of the Credit Agreement are required to be performed by it
as a Lender; and (vi) attaches any U.S. Internal Revenue Service
or other forms required under Section 2.17.
4. Following the execution of this Assignment and
Acceptance, it will be delivered to the Administrative Agent for
acceptance and recording by the Administrative Agent. The
effective date for this Assignment and Acceptance (the "Effective
Date") shall be the date of acceptance hereof by the
Administrative Agent, unless otherwise specified on Schedule 1.
5. Upon such acceptance and recording by the
Administrative Agent, as of the Effective Date, (i) the Assignee
shall be a party to the Credit Agreement and, to the extent
provided in this Assignment and Acceptance, have the rights and
obligations of a Lender thereunder and (ii) the Assignor shall,
to the extent provided in this Assignment and Acceptance,
relinquish its rights and be released from its obligations under
the Credit Agreement.
6. Upon such acceptance and recording by the
Administrative Agent, from and after the Effective Date, the
Administrative Agent shall make all payments under the Credit
Agreement in respect of the interest assigned hereby (including,
without limitation, all payments of principal, interest and
commitment fees with respect thereto) to the Assignee. The
Assignor and Assignee shall make all appropriate adjustments in
payments under the Credit Agreement for periods prior to the
Effective Date directly between themselves.
7. This Assignment and Acceptance shall be governed by,
and construed in accordance with, the laws of the State of New
York.
8. This Assignment and Acceptance may be executed in any
number of counterparts and by different parties hereto in
separate counterparts, each of which when so executed shall be
deemed to be an original and all of which taken together shall
constitute one and the same agreement. Delivery of an executed
counterpart of Schedule 1 to this Assignment and Acceptance by
telecopier shall be effective as delivery of a manually executed
counterpart of this Assignment and Acceptance.
IN WITNESS WHEREOF, the Assignor and the Assignee have
caused Schedule 1 to this Assignment and Acceptance to be
executed by their officers "hereunto duly authorized as of the
date specified thereon.
<PAGE>
<PAGE> 3
<TABLE>
<CAPTION>
SCHEDULE 1
to
ASSIGNMENT AND ACCEPTANCE
<C>
<S>
Percentage interest assigned: _________%
Assignee's Commitment: $_________
Aggregate outstanding principal amount of Loans
assigned: $_________
Principal amount of Note payable to Assignee: $_________
Principal amount of Note payable to Assignor: $_________
Effective Date (if other than date of acceptance
by Agent): *____, 19__
</TABLE>
[NAME OF ASSIGNOR], as Assignor
By:
_________________________________
Title:
Dated: _______________, 19 _
[NAME OF ASSIGNEE], as Assignee
By:
_________________________________
Title:
Domestic Lending Office:
Eurodollar Lending Office:
___________________
* This date should be no earlier than five Business Days after
the delivery of this Assignment and Acceptance to the Agent.
<PAGE>
<PAGE> 4
Accepted [and Approved] **
this ____ day of ____________, 19 _
NATIONSBANK OF TEXAS, N.A.
By: __________________________
Title:
[Approved this day
of ______________, 19_
ORYX ENERGY COMPANY
By: ____________________________]**
Title:
______________________________
** Required if the Assignee is an Eligible Assignee solely by
reason of clause (iii) of the definition of "Eligible
Assignee".
<PAGE>
EXHIBIT B-1
[FORM OF OPINION OF
CRAVATH, SWAINE & MOORE]
October __, 1997
Oryx Energy Company
Credit Agreement
Dear Sirs:
We have acted as special counsel for Oryx
Energy Company, a Delaware corporation (the
"Company"), in connection with the Credit
Agreement, dated as of October __, 1997 (the
"Credit Agreement"), among the Company, the
Lenders listed therein, the Agents identified
therein and NationsBank of Texas, N.A., as
administrative agent for the Lenders. Capitalized
terms defined in the Credit Agreement are used
herein as defined therein.
We have examined originals or copies,
certified or otherwise identified to our
satisfaction, of the Credit Agreement and such
other documents, corporate records, certificates
of public officials and other instruments and have
conducted such other investigations of fact and
law as we have deemed necessary or advisable for
purposes of this opinion. We have relied, with
respect to certain factual matters, on the
representations and warranties of the Company
contained in the Credit Agreement and have assumed
compliance by the Company with the terms of the
Credit Agreement. In rendering our opinion, we
also have assumed the due authorization, execution
and delivery of the Credit Agreement by all
parties thereto other than the Company.
Based upon the foregoing, we are of opinion
that:
1. The Company has the corporate power and authority to
execute, deliver and perform the terms and provisions of the
Credit Agreement and has taken all necessary corporate
action to authorize the execution, delivery and performance
by it of the Credit Agreement. The Credit Agreement has
been duly executed and delivered on behalf of the Company.
<PAGE>
<PAGE> 2
2. The Credit agreement constitutes a legal, valid and
binding agreement of the Company, enforceable against the
Company in accordance with its terms, except that (i) the
foregoing is subject to applicable bankruptcy,
reorganization, insolvency, fraudulent transfer, moratorium
and other similar laws affecting creditors' rights generally
from time to time in effect, (ii) the foregoing is also
subject to general principles of equity (including, without
limitation, concepts of materiality, reasonableness, good
faith and fair dealing), regardless of whether such
enforceability is considered in a proceeding in equity or at
law, (iii) insofar as provisions contained in the Credit
Agreement provide for indemnification, or provide that any
party is to be relieved of liability for its own negligence,
the enforcement thereof may be limited by public policy
considerations, and (iv) we express no opinion as to the
effect of the law of any jurisdiction other than the State
of New York wherein any Lender may be located or wherein
enforcement of the Credit Agreement may be sought which
limits the rates of interest legally chargeable or
collectible.
3. Neither the execution, delivery or performance by the
Company of the Credit Agreement, nor the consummation of the
transactions therein contemplated, nor compliance by it with
the terms and provisions thereof, will violate any provision
of the Articles of Incorporation or By-laws of the Company.
4. The execution, delivery and performance by the
Company of the Credit Agreement, compliance by it with the
terms and provisions thereof and the use of the proceeds
thereof in compliance with the Credit Agreement, will not
violate any applicable law or regulation of the State of New
York, the General Corporation Law of the State of Delaware
or the Federal laws of the United States of America
(including, without limitation, Regulations G, T, U and X of
the Board of Governors of the Federal Reserve System).
5. The execution, delivery and performance by the
Company of the Credit Agreement do not require any order,
consent, approval, license, authorization or validation of,
or filing, recording or registration with, or exemption by,
any governmental body, agency or official under the laws of
the State of New York, the General Corporation Law of the
State of Delaware or the Federal laws of the Untied States
of America.
We are members of the bar of the State of New York and do
not express any opinion as to any laws other than the laws of the
State of New York, the General Corporation Law of the State of
Delaware and the Federal laws of the Untied States of America.
<PAGE>
<PAGE> 3
This opinion is rendered solely to you in connection with
the above matter and may not be relied upon by you for any other
purpose or relied upon by any other person without our prior
written consent.
Very truly yours,
The Lender Parties to the
Credit Agreement referred to
above
In care of NationsBank of Texas, N.A.,
as Administrative Agent
901 Main Street
Dallas, Texas 75202
<PAGE>
EXHIBIT B-2
[FORM OF OPINION
OF WILLIAM C. LEMMER]
October __, 1997
The Lenders Parties to the Credit Agreement
referred to below
In care of NationsBank of Texas, N.A.
as Administrative Agent
901 Main Street
Dallas, Texas 75202
Oryx Energy Company
Credit Agreement
Dear Sirs:
I am Vice President, General Counsel and
Secretary of Oryx Energy Company, a Delaware
corporation (the "Company"), and have acted in
that capacity in connection with the Credit
Agreement, dated as of October __, 1997 (the
"Credit Agreement"), among the Company, the
Lenders listed therein and NationsBank of Texas,
N.A., as administrative agent for the Banks.
Capitalized terms defined in the Credit Agreement
are used herein as defined therein.
I or members of my staff have examined
originals or copies, certified or otherwise
identified to our satisfaction, of the Credit
Agreement and such other documents, corporate
records, certificates of public officials and
other instruments and have conducted such other
investigations of fact and law as we have deemed
necessary or advisable for purposes of this
opinion.
Based on the foregoing and on the
assumptions hereinafter set forth, and subject to
the exceptions, limitations and qualifications
hereinafter expressed, it is my opinion that:
1. The Company and each of the Material Subsidiaries of
the Company that is a corporation or a partnership organized
under the laws
<PAGE>
In care of NationsBank of Texas, N.A.
October __, 1997
Page 2
of any state of the United States of America (i) is a duly
organized and validly existing corporation or partnership,
as the case may be, in good standing under the laws of its
jurisdiction of organization, (ii) has the corporate or
partnership, as the case may be, power and authority to own
its property and assets and to transact the business in
which it is engaged and (iii) is duly qualified and is
authorized to do business and is in good standing in all
states of the United States of America where the failure to
do so would have a Material Adverse Effect.
2. The Company has the corporate power and authority to
execute, deliver and perform the terms and provisions of the
Credit Agreement and has taken all necessary corporate
action to authorize the execution, delivery and performance
by it of the Credit Agreement. The Credit Agreement has
been duly executed and delivered on behalf of the Company.
3. Except as disclosed in the Company's Annual Report on
Form 10-K for the year ended December 31, 1996, there are no
actions, suits or proceedings pending or, to the best of my
knowledge, threatened against or affecting the Company or
any Material Subsidiary before any court or before any
governmental or administrative body or agency that are
reasonably likely to have a Material Adverse Effect.
4. Neither the execution, delivery or performance by the
Company of the Credit Agreement, nor the consummation of the
transactions therein contemplated, nor compliance by it with
the terms and provisions thereof, (i) to the best of my
knowledge, will contravene any applicable provision of any
order, writ, injunction or decree of any court or government
instrumentality or (ii) to the best of my knowledge, will
conflict or be inconsistent with, or result in any breach
of, any of the terms, covenants, conditions or provisions
of, or constitute a default under, or result in the creation
or imposition of (or the obligation to create or impose) any
Lien upon any of the property or assets of the Company or
any of its Material Subsidiaries pursuant to the terms of,
any indenture, mortgage, deed of trust or other material
agreement or instrument to which the Company or any of its
Material Subsidiaries is a party or by which it or any of
its property or assets is bound or to which it may be
subject, or (iii) will violate any provision of the Articles
of Incorporation or By-laws of the Company or any of its
Material Subsidiaries. Based solely on matters brought to
my attention in the ordinary course of my position as Vice
President, General Counsel and Secretary of the Company, and
without any additional inquiry for purposes of rendering
this opinion, to the best of my knowledge, each of the
Company and its Subsidiaries is in compliance with all
Requirements of Law except to the extent that failure to
comply therewith (individually or in the aggregate) is not
reasonably likely to have a Material Adverse Effect.
<PAGE>
In care of NationsBank of Texas, N.A.
October __, 1997
Page 3
5. The Company is not an "investment company" or a
company "controlled" by an "investment company", within the
meaning of the Investment Company Act of 1940, as amended.
6. Neither the Company nor any Subsidiary is a "holding
company", or a "subsidiary company" of a "holding company",
or an "affiliate" of a "holding company" or of a "subsidiary
company" or a "holding company", within the meaning of the
Public Utility Holding Company Act of 1935, as amended.
I am a member of the bar of the State of New York and do
not express any opinion as to any laws other than the laws of the
State of New York, the General Corporation Law of the State of
Delaware and the Federal laws of the United States. This opinion
is rendered solely to you in connection with the above matter and
may not be relied upon by you for any other purpose or relied
upon by any other person without my prior written consent.
Very truly yours,
William C. Lemmer
WCL:lok
<PAGE>
EXHIBIT C
FORM OF NEW LENDER SUPPLEMENT
SUPPLEMENT, dated _________________ (this
"Supplement"), to the Credit Agreement, dated as of October __,
1997 (as amended from time to time, the "Credit Agreement"),
among ORYX ENERGY COMPANY, a Delaware corporation (the
"Borrower"), the several banks and other financial institutions
from time to time parties thereto (the "Lenders"), NATIONSBANC
CAPITAL MARKETS, INC., as Arranger (in such capacity, the
"Arranger"), CHASE SECURITIES INC., as Syndication Agent (in such
capacity, the "Syndication Agent"), BZW, the investment banking
division of Barclays Bank PLC, as Documentation Agent (in such
capacity, the "Documentation Agent") and NATIONSBANK OF TEXAS,
N.A., as administrative agent (in such capacity, the
"Administrative Agent").
W I T N E S S E T H:
WHEREAS, the Credit Agreement provides in Section 2.20
thereof that any bank, financial institution or other entity,
although not originally a party thereto, may become a party to
the Credit Agreement in accordance with the terms thereof by
executing and delivering to the Borrower and the Administrative
Agent a supplement to the Credit Agreement in substantially the
form of this Supplement; and
WHEREAS, the undersigned was not an original party to
the Credit Agreement but now desires to become a party thereto;
NOW, THEREFORE, the undersigned hereby agrees as
follows:
I. The undersigned agrees to be bound by the
provisions of the Credit Agreement, and agrees that it shall, on
the date this Supplement is accepted by the Borrower and the
Administrative Agent, become a Lender for all purposes of the
Credit Agreement to the same extent as if originally a party
thereto, with a Commitment of $__________________.
2. The undersigned (a) represents and warrants that it
is legally authorized to enter into this Supplement; (b) confirms
that it has received a copy of the Credit Agreement, together
with copies of the financial statements delivered pursuant to
Section 5.01 thereof and such other documents and information as
it has deemed appropriate to make its own credit analysis and
decision to enter into this Supplement; (c) agrees that it has
made and will, independently and without reliance upon the
Administrative Agent or any other Lender and based on such
documents and information as it shall deem appropriate at the
time, continue to make its own credit decisions in taking or not
taking action under the Credit Agreement or any instrument or
document furnished pursuant hereto or thereto; (d) appoints and
authorizes the Administrative Agent to take such action as
administrative agent on its behalf and to exercise such powers
and discretion under the Credit Agreement or any instrument or
document furnished pursuant hereto or thereto as are delegated to
the Administrative Agent by the terms thereof, together with such
powers as are incidental thereto; and (e) agrees that it will be
bound by the provisions of the Credit Agreement and will perform
in accordance with its terms all the
<PAGE>
<PAGE> 2
obligations which by the terms of the Credit Agreement are
required to be performed by it as a Lender including, without
limitation, if it is organized under the laws of a jurisdiction
outside the United States, its obligation pursuant to Section
2.17 of the Credit Agreement.
3. The undersigned's address for notices for the
purposes of the Credit Agreement is as follows:
4. Terms defined in the Credit Agreement shall have
their defined meanings when used herein.
IN WITNESS WHEREOF, the undersigned has caused this
Supplement to be executed and delivered by a duly authorized
officer on the date first above written.
[INSERT NAME OF LENDER]
By: _________________________
Name:
Title:
Accepted this _____ day of ______________, ____.
ORYX ENERGY COMPANY
By: _________________________
Name:
Title:
Accepted this _____ day of ______________, ____.
NATIONSBANK OF TEXAS, N.A.,
as Administrative Agent and as a Lender
By: _________________________
Name:
Title:
<PAGE>
EXHIBIT D
FORM OF COMMITMENT INCREASE SUPPLEMENT
SUPPLEMENT, dated _________________, to the Credit
Agreement, dated as of October __, 1997 (as amended from time to
time, the "Credit Agreement"), among ORYX ENERGY COMPANY, a
Delaware corporation (the "Borrower"), the several banks and
other financial institutions from time to time parties thereto
(the "Lenders"), NATIONSBANC CAPITAL MARKETS, INC., as Arranger
(in such capacity, the "Arranger"), CHASE SECURITIES INC., as
Syndication Agent (in such capacity, the "Syndication Agent"),
BZW, the investment banking division of Barclays Bank PLC, as
Documentation Agent (in such capacity, the "Documentation Agent")
and NATIONSBANK OF TEXAS, N.A., as administrative agent (in such
capacity, the "Administrative Agent").
W I T N E S S E T H:
WHEREAS, pursuant to the provisions of Section 2.20 of
the Credit Agreement, the undersigned may increase the amount of
its Commitment in accordance with the terms thereof by executing
and delivering to the Borrower and the Administrative Agent a
supplement to the Credit Agreement in substantially the form of
this Supplement; and
WHEREAS, the undersigned now desires to increase the
amount of its Commitment under the Credit Agreement;
NOW THEREFORE, the undersigned hereby agrees as
follows:
1. The undersigned agrees, subject to the terms and
conditions of the Credit Agreement, that on the date this
Supplement is accepted by the Borrower and the Administrative
Agent it shall have its Commitment increased by $______________,
thereby making the amount of its Commitment $______________.
2. Terms defined in the Credit Agreement shall have
their defined meanings when used herein.
<PAGE>
<PAGE> 2
IN WITNESS WHEREOF, the undersigned has caused this
Supplement to be executed and delivered by a duly authorized
officer on the date first above written.
[INSERT NAME OF LENDER]
By: _________________________
Name:
Title:
Accepted this _____ day of ______________, ____.
ORYX ENERGY COMPANY
By: _________________________
Name:
Title:
Accepted this _____ day of ______________, ____.
NATIONSBANK OF TEXAS, N.A.,
as Administrative Agent and as a Lender
By: _________________________
Name:
Title:
EXHIBIT 15
Securities and Exchange Commission
450 Fifth Street, Northwest
Washington, D.C. 20549
Attn.: Document Control
Re: Oryx Energy Company Form 10-Q
We are aware that our report dated November 4, 1997 on our review
of the interim condensed consolidated balance sheet of Oryx
Energy Company and its Subsidiaries as of September 30, 1997, the
related condensed consolidated statements of income for the three
and nine months ended September 30, 1997 and 1996, and the
related condensed consolidated statements of cash flows for the
nine months ended September 30, 1997 and 1996, included in this
Form 10-Q, is incorporated by reference in the following
registration statements:
Registration No.
On Form S-3 for:
Oryx Energy Company $500,000,000 Debt
Securities; Preferred Stock; and Common Stock 33-45611
Oryx Energy Company $600,000,000 Debt Securities 33-33361
Oryx Energy Company 7,259,394 shares of
Common Stock 33-36799
On Form S-8 for:
Oryx Energy Company 1992 Long-Term Incentive Plan 33-42695
Oryx Energy Company Long-Term Incentive Plan 33-25032
Oryx Energy Company Capital Accumulation Plan 33-24918
Oryx Energy Company Equity and Deferred
Compensation Plan for Non-Employee Directors 333-03075
Oryx Energy Company Executive Variable Incentive
Plan 333-03089
Oryx Energy Company 1997 Long-Term Incentive Plan 333-26563
Pursuant to Rule 436(c) under the Securities Act of 1933, this
report should not be considered a part of the registration
statement prepared or certified by us within the meaning of
Sections 7 and 11 of that Act.
/s/ COOPERS & LYBRAND L.L.P.
Dallas, Texas
November 4, 1997
EXHIBIT 12
ORYX ENERGY COMPANY
COMPUTATION OF CONSOLIDATED RATIO OF EARNINGS
TO FIXED CHARGES AND EARNINGS TO FIXED CHARGES AND PREFERRED
STOCK DIVIDEND REQUIREMENTS - UNAUDITED (a)
(Millions of Dollars)
<TABLE>
<CAPTION>
Three Months Nine Months
Ended Ended
September 30 September 30
1997 1997
<C> <C>
<S>
RATIO OF EARNINGS TO FIXED
CHARGES:
Fixed Charges:
Consolidated interest cost and debt
expense $ 28 $ 83
Interest allocable to rental expense (b) 4 7
----- -----
Total $ 32 $ 90
===== =====
Earnings:
Consolidated income before provision
for income taxes $ 52 $184
Fixed charges 32 90
Interest capitalized (4) (12)
Amortization of previously
capitalized interest 1 3
----- -----
Total $ 81 $265
===== =====
Ratio of Earnings to Fixed Charges 2.53 2.94
===== =====
RATIO OF EARNINGS TO FIXED CHARGES AND
PREFERRED STOCK DIVIDEND REQUIREMENTS:
Fixed Charges:
Consolidated interest cost and debt
expense $ 28 $ 83
Preferred stock dividend requirements - -
Interest allocable to rental expense (b) 4 7
----- -----
Total $ 32 $ 90
===== =====
Earnings:
Consolidated income before provision
for income taxes $ 52 $184
Fixed charges 32 90
Interest capitalized (4) (12)
Amortization of previously
capitalized interest 1 3
----- -----
Total $ 81 $265
===== =====
Ratio of Earnings to Fixed
Charges 2.53 2.94
===== =====
</TABLE>
<PAGE>
(a) The consolidated financial statements of Oryx Energy Company
include the accounts of all subsidiaries (more than 50
percent owned and/or controlled).
(b) Represents one-third of total operating lease rental expense
which is that portion deemed to be interest.
