$450,000,000
364-DAY CREDIT AGREEMENT
dated as of September 15, 1999
among
PECO ENERGY COMPANY
as Borrower
THE BANKS NAMED HEREIN
as Banks
THE FIRST NATIONAL BANK OF CHICAGO
as Administrative Agent
CITIBANK, N.A.
as Documentation Agent
and
BANC ONE CAPITAL MARKETS, INC.
as Lead Arranger
TABLE OF CONTENTS
Section Page
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ARTICLE I
DEFINITIONS AND ACCOUNTING TERMS
1.01 Certain Defined Terms................................................ 1
1.02 Computation of Time Periods.......................................... 9
1.03 Accounting Principles................................................ 9
ARTICLE II
AMOUNTS AND TERMS OF THE ADVANCES
2.01 The Advances.........................................................10
2.02 Making the Advances..................................................10
2.03 Fees.................................................................11
2.04 Reduction of the Commitments.........................................11
2.05 Repayment of Advances................................................11
2.06 Interest on Advances.................................................12
2.07 Additional Interest on Advances......................................12
2.08 Interest Rate Determination..........................................12
2.09 Conversion of Advances...............................................13
2.10 Prepayments..........................................................13
2.11 Increased Costs......................................................14
2.12 Illegality...........................................................15
2.13 Payments and Computations............................................15
2.14 Taxes................................................................16
2.15 Sharing of Payments, Etc.............................................18
2.16 Extension of Termination Date........................................18
2.17 Additional Lenders...................................................19
ARTICLE III
CONDITIONS OF LENDING
3.01 Conditions Precedent to Initial Advances.............................20
3.02 Conditions Precedent to Certain Borrowings...........................21
ARTICLE IV
REPRESENTATIONS AND WARRANTIES
4.01 Representations and Warranties of the Borrower.......................21
ARTICLE V
COVENANTS OF THE BORROWER
5.01 Affirmative Covenants................................................23
5.02 Negative Covenants...................................................25
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ARTICLE VI
EVENTS OF DEFAULT
6.01 Events of Default....................................................27
ARTICLE VII
THE AGENTS
7.01 Authorization and Action.............................................28
7.02 Agents' Reliance, Etc................................................29
7.03 Agents and Affiliates................................................29
7.04 Lender Credit Decision...............................................29
7.05 Indemnification......................................................29
7.06 Successor Administrative Agent.......................................30
7.07 Documentation Agent and Lead Arranger................................30
ARTICLE VIII
MISCELLANEOUS
8.01 Amendments, Etc......................................................30
8.02 Notices, Etc.........................................................30
8.03 No Waiver; Remedies..................................................31
8.04 Costs and Expenses; Indemnification..................................31
8.05 Right of Set-off.....................................................32
8.06 Binding Effect.......................................................32
8.07 Assignments and Participations.......................................32
8.08 Governing Law........................................................35
8.09 Consent to Jurisdiction..............................................35
8.10 Execution in Counterparts; Integration...............................35
Schedule I List of Applicable Lending Offices
Exhibit A Form of Note
Exhibit B Notice of a Borrowing
Exhibit C Assignment and Acceptance
Exhibit D Form of Opinion of Special Counsel for the Borrower
Exhibit E Form of Opinion of Counsel to the Administrative Agent
Exhibit F Form of Annual and Quarterly Compliance Certificate
Exhibit G Form of Additional Lender Supplement
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364-DAY CREDIT AGREEMENT
dated as of September 15, 1999
PECO Energy Company, a Pennsylvania corporation (the "Borrower"), the
banks listed on the signature pages hereof (the "Banks"), The First National
Bank of Chicago ("First Chicago"), as administrative agent for the Lenders
hereunder (in such capacity, the "Administrative Agent"), Citibank, N.A., as
documentation agent for the Lenders hereunder (in such capacity, the
"Documentation Agent"), and Banc One Capital Markets, Inc. ("Banc One Capital
Markets"), as lead arranger hereunder (in such capacity, the "Lead Arranger"),
hereby agree as follows:
ARTICLE I
DEFINITIONS AND ACCOUNTING TERMS
SECTION 1.01. Certain Defined Terms. As used in this Agreement, each of
the following terms shall have the meaning set forth next to such term below
(each such meaning to be equally applicable to both the singular and plural
forms of the term defined):
"Additional Lender" has the meaning specified in Section 2.17.
"Administrative Agent" means First Chicago in its capacity as
administrative agent for the Lenders pursuant to Article VII, and not in its
individual capacity as a Lender, and any successor Administrative Agent
appointed pursuant to Article VII.
"Advance" means an advance by a Lender to the Borrower as part of a
Borrowing and refers to a Base Rate Advance or a Eurodollar Rate Advance, each
of which shall be a "Type" of Advance.
"Affiliate" means, as to any Person, any other Person that, directly or
indirectly, controls, is controlled by or is under common control with such
Person or is a director or officer of such Person.
"Agents" means the Administrative Agent, the Documentation Agent and
the Lead Arranger, collectively.
"Applicable Commitment Fee Rate" means (i) during any Xxxxx 0 Rating
Period, 0.08% per annum, (ii) during any Level 2 Rating Period, 0.100% per
annum, (iii) during any Level 3 Rating Period, 0.125% per annum, (iv) during any
Level 4 Rating Period, 0.1625% per annum and (v) during any Level 5 Rating
Period, 0.275% per annum. The Applicable Commitment Fee Rate shall change when
and as the Rating Period changes.
"Applicable Lending Office" means, with respect to each Lender, such
Lender's Domestic Lending Office in the case of a Base Rate Advance, and such
Lender's Eurodollar Lending Office in the case of a Eurodollar Rate Advance.
"Applicable Margin" means, on any date, for a Base Rate Advance or a
Eurodollar Rate Advance, the interest rate per annum set forth below in the
column entitled "Base Rate" or "Eurodollar Rate", as appropriate, opposite the
applicable Rating Period in effect on such date:
Rating Period Base Rate Eurodollar Rate
------------- --------- ---------------
Xxxxx 0 0 .000%
Xxxxx 0 0 .000%
Xxxxx 0 0 .600%
Level 4 0 .750%
Level 5 0 1.00%
provided, that the Applicable Margin for Eurodollar Advances shall be increased
by .10% for any day when the unused portion of the Commitments is less than or
equal to 50% of the aggregate Commitments. The Applicable Margin applicable to
an outstanding Advance shall change when and as the Rating Period changes, and
when and as the unused portion of the Commitments changes.
"Assignment and Acceptance" means an assignment and acceptance entered
into by a Lender and an Eligible Assignee, and accepted by the Administrative
Agent, in substantially the form of Exhibit C hereto.
"Base Rate" means, for any period, a fluctuating interest rate per
annum as shall be in effect from time to time which rate per annum shall at all
times be equal to the higher of:
(a) the rate of interest announced by First Chicago, from time to
time, as its corporate base rate; and
(b) the sum of 1/2 of 1% per annum plus the Federal Funds Rate in
effect from time to time.
"Base Rate Advance" means an Advance that bears interest as provided in
Section 2.06(a).
"Benchmark Debt" means the Borrower's senior secured long-term debt or,
in the event that the Borrower has no senior secured long-term debt rated by S&P
(or by a generally recognized successor to S&P) or by Moody's (or by a generally
recognized successor to Moody's), the Borrower's senior unsecured long-term
debt.
"Borrowing" means a borrowing consisting of simultaneous Advances of
the same Type and, if such Borrowing comprises Eurodollar Rate Advances, having
Interest Periods of the same duration, made by each of the Lenders pursuant to
Section 2.01 or Converted pursuant to Section 2.10.
"Business Day" means a day of the year on which banks are not required
or authorized to close in Philadelphia, Pennsylvania, Chicago, Illinois or New
York, New York, and, if the applicable Business Day relates to any Eurodollar
Rate Advances, on which dealings are carried on in the London interbank market.
"Closing Date" shall mean the date of the initial Advances hereunder.
"Code" means the Internal Revenue Code of 1986, and the regulations
promulgated thereunder, in each case as amended, reformed or otherwise modified
from time to time.
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"Commitment" has the meaning specified in Section 2.01.
"Consolidated Adjusted Total Capitalization" on any date shall mean the
sum, without duplication, of the following with respect to the Borrower and its
consolidated Subsidiaries (exclusive, in each case, of Nonrecourse Transition
Bond Debt, to the extent Nonrecourse Transition Bond Debt would otherwise be
included in such item): (a) total capitalization as of such date, as determined
in accordance with GAAP, (b) the current portion of liabilities which as of such
date would be classified in whole or part as long-term debt in accordance with
GAAP (it being understood that the noncurrent portion of such liabilities is
included in the total capitalization referred to in clause (a)), (c) all
obligations as lessee which, in accordance with GAAP, are capitalized as
liabilities (including the current portion thereof), and (d) all other
liabilities which would be classified as short-term debt in accordance with GAAP
(including, without limitation, all liabilities of the types classified as
"Notes Payable, Bank" on the Borrower's audited balance sheet for December 31,
1998).
"Consolidated Adjusted Total Debt" on any date shall mean the sum,
without duplication, of the following with respect to the Borrower and its
consolidated Subsidiaries (exclusive, in each case, of Nonrecourse Transition
Bond Debt, to the extent Nonrecourse Transition Bond Debt would otherwise be
included in such item): (a) all liabilities which as of such date would be
classified in whole or in part as long-term debt in accordance with GAAP
(including the current portion thereof), (b) all obligations as lessee which, in
accordance with GAAP, are capitalized as liabilities (including the current
portion thereof), and (c) all other liabilities which would be classified as
short-term debt in accordance with GAAP (including, without limitation, all
liabilities of the types classified as "Notes Payable, Bank" on the Borrower's
audited balance sheet for December 31, 1998).
"Controlled Group" means all members of a controlled group of
corporations and all trades or businesses (whether or not incorporated) under
common control that, together with the Borrower or any Subsidiary, are treated
as a single employer under Section 414(b) or 414(c) of the Code.
"Convert", "Conversion" and "Converted" each refers to a conversion of
Advances of one Type into Advances of another Type or the selection of a new, or
the renewal of the same, Interest Period for Eurodollar Rate Advances pursuant
to Section 2.09.
"Debt" means (i) indebtedness for borrowed money, (ii) obligations
evidenced by bonds, debentures, notes or other similar instrument, (iii)
obligations to pay the deferred purchase price of property or services (other
than trade payables incurred in the ordinary course of business), (iv)
obligations as lessee under leases that shall have been or are required to be,
in accordance with GAAP, recorded as capital leases, (v) obligations (contingent
or otherwise) under reimbursement or similar agreements with respect to the
issuance of letters of credit (other than obligations in respect of documentary
letters of credit opened to provide for the payment of goods or services
purchased in the ordinary course of business) and (vi) obligations under direct
or indirect guaranties in respect of, and obligations (contingent or otherwise)
to purchase or otherwise acquire, or otherwise to assure a creditor against loss
in respect of, indebtedness or obligations of others of the kinds referred to in
clauses (i) through (v) above.
"Documentation Agent" means Citibank, N.A., in its capacity as
Documentation Agent.
"Domestic Lending Office" means, with respect to any Lender, the office
of such Lender specified as its "Domestic Lending Office" opposite its name on
Schedule I hereto or in the Assignment and Acceptance pursuant to which it
became a Lender, or such other office of such Lender as such Lender may from
time to time specify to the Borrower and the Administrative Agent.
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"Eligible Assignee" means (i) a commercial bank organized under the
laws of the United States, or any State thereof; (ii) a commercial bank
organized under the laws of any other country that is a member of the OECD or
has concluded special lending arrangements with the International Monetary Fund
associated with its General Arrangements to Borrow, or a political subdivision
of any such country, provided that such bank is acting through a branch or
agency located in the United States; (iii) a finance company, insurance company
or other financial institution or fund (whether a corporation, partnership or
other entity) engaged generally in making, purchasing or otherwise investing in
commercial loans in the ordinary course of its business; or (iv) the central
bank of any country that is a member of the OECD; provided, however, that (A)
any such Person described in clause (i), (ii) or (iii) above shall also (x) have
outstanding unsecured long-term debt that is rated BBB- or better by S&P and
Baa3 or better by Moody's (or an equivalent rating by another nationally
recognized credit rating agency of similar standing if either such corporation
is no longer in the business of rating unsecured indebtedness of entities
engaged in such businesses) and (y) have combined capital and surplus (as
established in its most recent report of condition to its primary regulator) of
not less than $100,000,000 (or its equivalent in foreign currency), and (B) any
Person described in clause (ii), (iii) or (iv) above shall, on the date on which
it is to become a Lender hereunder, be entitled to receive payments hereunder
without deduction or withholding of any United States Federal income taxes (as
contemplated by Section 2.14(e)).
"Eligible Successor" means a Person which (i) is a corporation duly
incorporated, validly existing and in good standing under the laws of one of the
states of the United States or the District of Columbia, (ii) is qualified to do
business in Pennsylvania, (iii) as a result of the contemplated acquisition,
consolidation or merger, will succeed to all or substantially all of the
consolidated business and assets of the Borrower and its Subsidiaries, (iv) upon
giving effect to the contemplated acquisition, consolidation or merger, will
have all or substantially all of its consolidated business and assets conducted
and located in the United States and (v) is acceptable to the Majority Lenders
as a credit matter.
"ERISA" means the Employee Retirement Income Security Act of 1974, as
amended from time to time, and the regulations promulgated and rulings issued
thereunder, each as amended and modified from time to time.
"Eurocurrency Liabilities" has the meaning assigned to that term in
Regulation D of the Board of Governors of the Federal Reserve System, as in
effect from time to time.
"Eurodollar Lending Office" means, with respect to any Lender, the
office of such Lender specified as its "Eurodollar Lending Office" opposite its
name on Schedule I hereto or in the Assignment and Acceptance pursuant to which
it became a Lender (or, if no such office is specified, its Domestic Lending
Office), or such other office of such Lender as such Lender may from time to
time specify to the Borrower and the Administrative Agent.
"Eurodollar Rate" means, for the Interest Period for each Eurodollar
Rate Advance made as part of the same Borrowing, an interest rate per annum
equal to the average (rounded upward to the nearest whole multiple of 1/16 of 1%
per annum, if such average is not such a multiple) of the rate per annum at
which deposits in U.S. dollars are offered by the principal office of each of
the Reference Banks in London, England, to prime banks in the London interbank
market at 11:00 A.M. (London time) two Business Days before the first day of
such Interest Period in an amount substantially equal to such Reference Bank's
Eurodollar Rate Advance made as part of such Borrowing and for a period equal to
such Interest Period. The Eurodollar Rate for the Interest Period for each
Eurodollar Rate Advance made as part of the same Borrowing shall be determined
by the Administrative Agent on the basis of applicable rates furnished to and
received by the Administrative Agent from the Reference Banks two Business Days
before the first day of such Interest Period, subject, however, to the
provisions of Section 2.08.
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"Eurodollar Rate Advance" means an Advance that bears interest as
provided in Section 2.06(b).
"Eurodollar Rate Reserve Percentage" of any Lender for the Interest
Period for any Eurodollar Rate Advance means the reserve percentage applicable
during such Interest Period (or if more than one such percentage shall be so
applicable, the daily average of such percentages for those days in such
Interest Period during which any such percentage shall be so applicable) under
regulations issued from time to time by the Board of Governors of the Federal
Reserve System (or any successor) for determining the maximum reserve
requirement (including, without limitation, any emergency, supplemental or other
marginal reserve requirement) for such Lender with respect to liabilities or
assets consisting of or including Eurocurrency Liabilities having a term equal
to such Interest Period.
"Events of Default" has the meaning specified in Section 6.01.
"Exchange Act" means the Securities Exchange Act of 1934, as amended
and modified from time to time.
"Existing Credit Agreements" shall mean (i) the $450,000,000 364-Day
Credit Agreement dated as of October 7, 1997, among the Borrower, the banks
named therein, certain banks specified therein as lead managers, certain banks
specified therein as co-agents, First Chicago Capital Markets, Inc., Mellon
Bank, N.A., and Citicorp Securities, Inc, as syndication agents, First Chicago
Capital Markets, Inc. and Mellon Bank, N.A., as arrangers, The First National
Bank of Chicago, as Administrative Agent, and Mellon Bank, N.A., as
Documentation Agent, and (ii) the $450,000,000 Credit Agreement dated as of
October 7, 1997, among the Borrower, the banks named therein, certain specified
banks, as lead arrangers, certain specified banks, as co-agents, First Chicago
Capital Markets, Inc., Mellon Bank, N.A., and Citicorp Securities, Inc., as
syndication agents, First Chicago Capital Markets, Inc. and Mellon Bank, N.A.,
as arrangers, The First National Bank of Chicago, as Administrative Agent, and
Mellon Bank, N.A., as Documentation Agent, in each case as amended, modified or
supplemented from time to time.
"Federal Funds Rate" means, for any period, a fluctuating interest rate
per annum equal for each day during such period to the weighted average of the
rates on overnight Federal funds transactions with members of the Federal
Reserve System arranged by Federal funds brokers, as published for such day (or,
if such day is not a Business Day, for the next preceding Business Day) by the
Federal Reserve Bank of New York, or, if such rate is not so published for any
day which is a Business Day, the average of the quotations for such day on such
transactions received by the Administrative Agent from three Federal funds
brokers of recognized standing selected by it.
"FERC" means the Federal Energy Regulatory Commission.
"FERC Application" has the meaning assigned to that term in Section
3.01(a)(iii).
"FERC Authorization" has the meaning assigned to that term in Section
3.01(a)(iii).
"GAAP" shall have the meaning given that term in Section 1.03.
"Granting Bank" shall have the meaning given that term in Section
8.07(h).
"Interest Period" means, for each Advance, the period commencing on the
date of such Advance or the date of the Conversion of any Advance into such an
Advance and ending on the last day of the period selected by the Borrower
pursuant to the provisions below and, thereafter, each subsequent period
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commencing on the last day of the immediately preceding Interest Period and
ending on the last day of the period selected by the Borrower pursuant to the
provisions below. The duration of each such Interest Period shall be 1, 2, 3 or
6 months in the case of a Eurodollar Rate Advance, as the Borrower may select in
accordance with Section 2.02 or 2.09; provided, however, that:
(i) the Borrower may not select any Interest Period that ends after
the Termination Date then in effect;
(ii) Interest Periods commencing on the same date for Advances made
as part of the same Borrowing shall be of the same duration, and
(iii) whenever the last day of any Interest Period would otherwise
occur on a day other than a Business Day, the last day of such Interest
Period shall be extended to occur on the next succeeding Business Day,
provided, in the case of any Interest Period for a Eurodollar Rate
Advance, that if such extension would cause the last day of such
Interest Period to occur in the next following calendar month, the last
day of such Interest Period shall occur on the next preceding Business
Day.
"Lead Arranger" means Banc One Capital Markets in its capacity as Lead
Arranger.
"Lenders" means the Banks listed on the signature pages hereof and each
Eligible Assignee that shall become a party hereto pursuant to Section 2.17 or
8.07.
"Level 1 Rating Period" means any period during which the Benchmark
Debt is rated A- or higher by S&P (or a comparable rating from any generally
recognized successor to S&P) or A3 or higher by Moody's (or a comparable rating
from any generally recognized successor to Moody's) (it being understood that,
for this purpose, such ratings shall be subject to the Split Rating Adjustment).
"Level 2 Rating Period" means any period which does not qualify as a
Level 1 Rating Period during which the Benchmark Debt is rated BBB+ or higher by
S&P (or a comparable rating from any generally recognized successor to S&P) or
Baa1 or higher by Moody's (or a comparable rating from any generally recognized
successor to Moody's) (it being understood that, for this purpose, such ratings
shall be subject to the Split Rating Adjustment).
"Level 3 Rating Period" means any period which does not qualify as a
Level 1 or Level 2 Rating Period during which the Benchmark Debt is rated BBB or
higher by S&P (or a comparable rating from any generally recognized successor to
S&P) or Baa2 or higher by Moody's (or a comparable rating from any generally
recognized successor to Moody's) (it being understood that, for this purpose,
such ratings shall be subject to the Split Rating Adjustment).
"Level 4 Rating Period" means any period which does not qualify as a
Xxxxx 0, Xxxxx 0 or Level 3 Rating Period during which the Benchmark Debt is
rated BBB- or higher by S&P (or a comparable rating from any generally
recognized successor to S&P) or Baa3 or higher by Moody's (or a comparable
rating from any generally recognized successor to Moody's) (it being understood
that, for this purpose, such ratings shall be subject to the Split Rating
Adjustment).
"Level 5 Rating Period" means any period which does not qualify as a
Xxxxx 0, Xxxxx 0, Xxxxx 0 or Level 4 Rating Period (it being understood that,
for this purpose, such ratings shall be subject to the Split Rating Adjustment).
"Lien" means any lien (statutory or other), mortgage, pledge, security
interest or other charge or encumbrance, or any other type of preferential
arrangement (including, without limitation, the interest of a vendor or lessor
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under any conditional sale, capitalized lease or other title retention
agreement).
"Majority Lenders" means, at any time prior to the Termination Date,
Lenders having at least 51% of the Commitments, and, at any time on or after the
Termination Date, Lenders having at least 51% of the Advances outstanding
(provided that, for purposes hereof, neither the Borrower, nor any of its
Affiliates, if a Lender, shall be included in (i) the Lenders having such amount
of the Commitments or the Advances or (ii) determining the total amount of the
Commitments or the Advances).
"Material Adverse Change" and "Material Adverse Effect" each means,
relative to any occurrence, fact or circumstances of whatsoever nature
(including, without limitation, any determination in any litigation, arbitration
or governmental investigation or proceeding), (i) any materially adverse change
in, or materially adverse effect on, the financial condition, operations, assets
or business of the Borrower and its consolidated Subsidiaries, taken as a whole
or (ii) any materially adverse effect on the validity or enforceability of this
Agreement or any of the Notes.
"Moody's" means Xxxxx'x Investors Service, Inc.
"Mortgage" means the First and Refunding Mortgage, dated as of May 1,
1923, between The Counties Gas & Electric Company (to which the Borrower is
successor) and Fidelity Trust Company, Trustee (to which First Union National
Bank is successor), as amended, supplemented or refinanced from time to time,
provided, that no effect shall be given to any amendment, supplement or
refinancing after the date of this Agreement that would broaden the definition
of "excepted encumbrances" as defined in the Mortgage as constituted on the date
of this Agreement.
"Multiemployer Plan" means a Plan maintained pursuant to a collective
bargaining agreement or any other arrangement to which the Borrower or any
member of the Controlled Group is a party to which more than one employer is
obligated to make contributions.
"Non-Consenting Lender" has the meaning specified in Section 2.16(a).
"Nonrecourse Transition Bond Debt" means obligations evidenced by
"transition bonds" (as defined in 66 Pa. Cons. Stat. Xxx. ss. 2812(g) (West
Supp. 1997), or any successor provision of similar import), rated AA or higher
by S&P (or a comparable rating from a generally recognized successor to S&P) or
Aa2 or higher by Moody's (or a comparable rating from a generally recognized
successor to Moody's), representing a securitization of "intangible transition
property" (as defined in the foregoing statute), as to which obligations neither
the Borrower nor any Subsidiary of the Borrower (other than a Special Purpose
Subsidiary) has any direct or indirect liability (whether as primary obligor,
guarantor, or surety, provider of collateral security, put option, asset
repurchase agreement or capital maintenance agreement, debt subordination
agreement, or through other right or arrangement of any nature providing direct
or indirect assurance of payment or performance of any such obligations in whole
or in part), except for liability to repurchase "intangible transition property"
conveyed to the securitization vehicle, on terms and conditions customary in
receivables securitizations, in the event such "intangible transition property"
violates representations and warranties of scope customary in receivables
securitizations. "Special Purpose Subsidiary" means a direct or indirect
wholly-owned corporate Subsidiary of the Borrower, substantially all of the
assets of which are "intangible transition property" and proceeds thereof,
formed solely for the purpose of holding such assets and issuing such
"transition bonds," and which complies with the requirements customarily imposed
on bankruptcy-remote corporations in receivables securitizations.
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"Note" means a promissory note of the Borrower payable to the order of
any Lender, in substantially the form of Exhibit A hereto, evidencing the
aggregate indebtedness of the Borrower to such Lender resulting from the
Advances made by such Lender, including any Notes delivered pursuant to Section
2.16.
"Notice of a Borrowing" has the meaning specified in Section 2.02(a).
"OECD" means the Organization for Economic Cooperation and Development.
"PBGC" means the Pension Benefit Guaranty Corporation and any entity
succeeding to any or all of its functions under ERISA.
"Person" means an individual, partnership, corporation (including a
business trust), joint stock company, trust, unincorporated association, joint
venture, limited liability company or other entity, or a government or any
political subdivision or agency thereof.
"Plan" means an employee pension benefit plan that is covered by Title
IV of ERISA or subject to the minimum funding standards under Section 412 of the
Code as to which the Borrower or any member of the Controlled Group may have any
liability.
"Principal Subsidiary" means (i) each Utility Subsidiary and (ii) from
and after the date on which the aggregate book value of the assets of the
Subsidiaries of the Borrower that are not Utility Subsidiaries exceeds
$250,000,000, each such Subsidiary the assets of which exceeded $75,000,000 in
book value at any time during the preceding 24-month period.
"Rating Period" means a Level 1 Rating Period, a Level 2 Rating Period,
a Level 3 Rating Period, a Level 4 Rating Period or a Level 5 Rating Period, as
the case may be.
"Reference Banks" means First Chicago and Citibank, N.A.
"Register" has the meaning specified in Section 8.07(c).
"Reportable Event" means a reportable event as defined in Section 4043
of ERISA and regulations issued under such section with respect to a Plan,
excluding, however, such events as to which the PBGC by regulation waived the
requirement of Section 4043(a) of ERISA that it be notified within 30 days of
the occurrence of such event, provided that a failure to meet the minimum
funding standard of Section 412 of the Code and Section 302 of ERISA shall be a
Reportable Event regardless of the issuance of any such waivers in accordance
with either Section 4043(a) of ERISA or Section 412(d) of the Code.
"Revolving Credit Agreement" means that certain Revolving Credit
Agreement, dated as of the date hereof, among the Borrower, the banks named
therein, First Chicago, as administrative agent for the lenders thereunder,
Citibank, N.A., as documentation agent, and Banc One Capital Markets, as lead
arranger, as the same may be amended, modified or supplemented from time to
time.
"S&P" means Standard & Poor's Ratings Services, a division of The
XxXxxx-Xxxx Companies, Inc.
"Single Employer Plan" means a Plan maintained by the Borrower or any
member of the Controlled Group for employees of the Borrower or any member of
the Controlled Group.
"SPC" shall have the meaning assigned to that term in Section 8.07(h).
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"Special Purpose Subsidiary" has the meaning assigned to that term in
the definition of "Nonrecourse Transition Bond Debt."
"Split Rating Adjustment": For the purpose of determining the
appropriate Rating Period, the rating of the Benchmark Debt shall be subject to
adjustment as follows. In the event that the Benchmark Debt is rated at
equivalent rating levels or not more than one rating level apart by S&P (or any
generally accepted successor to S&P) and Moody's (or any generally accepted
successor to Moody's), then no adjustment shall apply. Otherwise, the higher of
the two ratings shall be deemed to be reduced to the next lower rating level.
For this purpose, (i) determination of the rating level shall take into account
"+" and "-" modifiers to S&P ratings and numerical modifiers to Moody's ratings
(so that, for example, an S&P rating of A- shall be deemed equivalent to a
Xxxxx'x rating of A3, an S&P rating of BBB+ shall be deemed equivalent to a
Xxxxx'x rating of Baa1, an S&P rating of BBB shall be deemed equivalent to a
Xxxxx'x rating of Baa2, an S&P rating of BBB- shall be deemed equivalent to a
Xxxxx'x rating of Baa3, and so on), and (ii) by way of clarification, in the
event the Benchmark Debt is rated by only one of the two referenced rating
agencies, such rating shall be deemed to be reduced to the next lower rating
level.
"Subsidiary" means, with respect to any Person, any corporation or
unincorporated entity of which more than 50% of the outstanding capital stock
(or comparable interest) having ordinary voting power (irrespective of whether
or not at the time capital stock, or comparable interests, of any other class or
classes of such corporation or entity shall or might have voting power upon the
occurrence of any contingency) is at the time directly or indirectly owned by
such Person (whether directly or through one or more other Subsidiaries).
"Termination Date" means the earlier of (i) September 13, 2000 (or, if
such date is not a Business Day, the next preceding Business Day) or such later
date that may be established pursuant to Section 2.16(a) or (ii) the date of
termination in whole of the Commitments pursuant to Section 2.04 or Section
6.01.
"Unfunded Liabilities" means, (i) in the case of any Single Employer
Plan, the amount (if any) by which the present value of all vested
nonforfeitable benefits under such Plan exceeds the fair market value of all
Plan assets allocable to such benefits, all determined as of the then most
recent evaluation date for such Plan, and (ii) in the case of any Multiemployer
Plan, the withdrawal liability that would be incurred by the Controlled Group if
all members of the Controlled Group completely withdrew from such Multiemployer
Plan.
"Utility Subsidiary" means each Subsidiary of the Borrower that is
engaged principally in the generation, transmission, or distribution of
electricity or gas and is subject to regulation as a public utility by federal
or state regulatory authorities.
"Year 2000 Problem" shall mean that the computer hardware, software or
equipment containing embedded microchips of the Borrower or any of its
Subsidiaries which is essential to its business or operation will, as a result
of processing dates or time periods occurring after December 31, 1999,
malfunction, causing a system failure or miscalculations resulting in
disruptions of operations, including, among other things, a temporary inability
to process transactions, send bills, operate generation stations, or engage in
similar normal business activities.
SECTION 1.02. Computation of Time Periods. In this Agreement in the
computation of periods of time from a specified date to a later specified date,
the word "from" means "from and including" and the words "to" and "until" each
means "to but excluding".
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SECTION 1.03. Accounting Principles. As used in this Agreement, "GAAP"
shall mean generally accepted accounting principles in the United States,
applied on a basis consistent with the principles used in preparing the
Borrower's audited consolidated financial statements as of December 31, 1998 and
for the fiscal year then ended. In this Agreement, except to the extent, if any,
otherwise provided herein, all accounting and financial terms shall have the
meanings ascribed to such terms by GAAP, and all computations and determinations
as to accounting and financial matters shall be made in accordance with GAAP. In
the event that the financial statements generally prepared by the Borrower apply
accounting principles other than GAAP, the compliance certificate delivered
pursuant to Section 5.01(b)(iv) accompanying such financial statements shall
include information in reasonable detail reconciling such financial statements
to GAAP to the extent relevant to the calculations set forth in such compliance
certificate.
ARTICLE II
AMOUNTS AND TERMS OF THE ADVANCES
SECTION 2.01. The Advances. Each Lender severally agrees, on the terms
and conditions hereinafter set forth, to make Advances to the Borrower from time
to time on any Business Day during the period from the date hereof until (but
excluding) the Termination Date in an aggregate amount not to exceed at any time
outstanding the amount set forth opposite such Lender's name on the signature
pages hereof or, if such Lender has entered into any Assignment and Acceptance
or Additional Lender Supplement, set forth for such Lender in the Register
maintained by the Administrative Agent pursuant to Section 8.07(c), as such
amount may be reduced pursuant to Section 2.04 or 2.16 (such Lender's
"Commitment"). Each Borrowing shall consist of Advances of the same Type made or
Converted on the same day by the Lenders ratably according to their respective
Commitments. Each Borrowing comprising Base Rate Advances shall be in an
aggregate amount not less than $5,000,000, and each Borrowing comprising
Eurodollar Rate Advances shall be in an aggregate amount not less than
$10,000,000. Within the limits of each Lender's Commitment, the Borrower may
from time to time borrow, prepay pursuant to Section 2.10 and reborrow under
this Section 2.01.
SECTION 2.02. Making the Advances. (a) Each Borrowing (other than
pursuant to a Conversion) shall be made on notice, given not later than 10:00
A.M. (Chicago time) on the third Business Day prior to the date of any proposed
Borrowing comprising Eurodollar Rate Advances, and on the date of any proposed
Borrowing comprising Base Rate Advances, by the Borrower to the Administrative
Agent, which shall give to each Lender prompt notice thereof. Each such notice
of a Borrowing (a "Notice of a Borrowing") shall be sent by telecopier, telex or
cable, confirmed immediately in writing, in substantially the form of Exhibit B
hereto, specifying therein the requested (i) date of such Borrowing, (ii) Type
of Advances to be made in connection with such Borrowing, (iii) aggregate amount
of such Borrowing, and (iv) in the case of a Borrowing comprising Eurodollar
Rate Advances, initial Interest Period for the Advances to be made in connection
with such Borrowing. Each Lender shall, before 12:00 Noon (Chicago time) on the
date of such Borrowing, make available for the account of its Applicable Lending
Office to the Administrative Agent at its address referred to in Section 8.02,
in same day funds, such Lender's ratable portion of such Borrowing. After the
Administrative Agent's receipt of such funds and upon fulfillment of the
applicable conditions set forth in Article III, the Administrative Agent will
make such funds available to the Borrower at the Administrative Agent's
aforesaid address.
(b) Each Notice of a Borrowing shall be irrevocable and binding on the
Borrower. In the case of any Borrowing that the related Notice of a Borrowing
specifies is to comprise Eurodollar Rate Advances, the Borrower shall indemnify
each Lender against any loss, cost or expense incurred by such Lender as a
result of any failure to fulfill on or before the date specified in such Notice
of a Borrowing for such Borrowing the applicable conditions set forth in Article
III, including, without limitation, any loss, cost or expense incurred by reason
of the liquidation or reemployment of deposits or other funds acquired by such
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Lender to fund the Advance to be made by such Lender as part of such Borrowing
when such Advance, as a result of such failure, is not made on such date.
(c) Unless the Administrative Agent shall have received notice from a
Lender prior to the date of any Borrowing that such Lender will not make
available to the Administrative Agent such Lender's ratable portion of such
Borrowing, the Administrative Agent may assume that such Lender has made such
portion available to the Administrative Agent on the date of such Borrowing in
accordance with subsection (a) of this Section 2.02 and the Administrative Agent
may, in reliance upon such assumption, make available to the Borrower on such
date a corresponding amount. If and to the extent that such Lender shall not
have so made such ratable portion available to the Administrative Agent, such
Lender and the Borrower severally agree to repay to the Administrative Agent
forthwith on demand such corresponding amount together with interest thereon,
for each day from the date such amount is made available to the Borrower until
the date such amount is repaid to the Administrative Agent, at (i) in the case
of the Borrower, the interest rate applicable at the time to Advances made in
connection with such Borrowing and (ii) in the case of such Lender, the Federal
Funds Rate. If such Lender shall repay to the Administrative Agent such
corresponding amount, such amount so repaid shall constitute such Lender's
Advance as part of such Borrowing for purposes of this Agreement.
(d) The failure of any Lender to make the Advance to be made by it as
part of any Borrowing shall not relieve any other Lender of its obligation, if
any, hereunder to make its Advance on the date of such Borrowing, but no Lender
shall be responsible for the failure of any other Lender to make the Advance to
be made by such other Lender on the date of any Borrowing.
(e) Notwithstanding anything to the contrary contained herein, no more
than sixteen (16) Borrowings comprising Eurodollar Rate Advances may be
outstanding at any time.
SECTION 2.03. Fees. (a) The Borrower agrees to pay to the
Administrative Agent for the account of each Lender a commitment fee on the
average daily unused portion of such Lender's Commitment from the date on which
the Administrative Agent determines the conditions set forth in Section 3.01 are
satisfied in the case of each Bank, and from the effective date specified in the
Assignment and Acceptance or the Additional Lender Supplement pursuant to which
it became a Lender in the case of each other Lender, until the Termination Date,
and, in the case of the termination in whole of a Lender's Commitment pursuant
to Section 2.04 or 2.16, the date of such termination, payable on the last day
of each March, June, September and December during such period, and on the
Termination Date, and, in the case of the termination in whole of a Lender's
Commitment pursuant to Section 2.04 or 2.16, the date of such termination, at a
percentage rate per annum equal to the Applicable Commitment Fee Rate in effect
from time to time, changing when and as the Applicable Commitment Fee Rate
changes.
(b) The Borrower agrees to pay to the Administrative Agent for the
account of each Bank a facility fee in an amount equal to .075% of such Bank's
Commitment as in effect on the Closing Date, payable on the Closing Date.
(c) The Borrower agrees to pay to the Administrative Agent and the Lead
Arranger for their respective accounts, such additional fees, in such amounts
and payable on such dates as may be agreed to in writing from time to time
between the Borrower and the Administrative Agent or the Lead Arranger, as the
case may be.
SECTION 2.04. Reduction of the Commitments. The Borrower shall have the
right, upon at least two Business Days' notice to the Administrative Agent, to
terminate in whole or reduce ratably in part the unused portions of the
respective Commitments of the Lenders; provided, that the aggregate amount of
the Commitments of the Lenders shall not be reduced to an amount that is less
than the aggregate principal amount of the Advances then outstanding; and
provided, further, that each partial reduction shall be in the aggregate amount
of $10,000,000 or an integral multiple thereof.
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SECTION 2.05. Repayment of Advances. The Borrower shall repay the
principal amount of each Advance made by each Lender in accordance with the Note
to the order of such Lender.
SECTION 2.06. Interest on Advances. The Borrower shall pay interest on
the unpaid principal amount of each Advance made by each Lender from the date of
such Advance until such principal amount shall be paid in full, at the following
rates per annum:
(a) Base Rate Advances. If such Advance is a Base Rate Advance, a rate
per annum equal at all times to the Base Rate in effect from time to time,
payable quarterly on the last day of each March, June, September and December
during such periods and on the date such Base Rate Advance shall be Converted or
paid in full.
(b) Eurodollar Rate Advances. Subject to Section 2.07, if such Advance
is a Eurodollar Rate Advance, a rate per annum equal at all times during the
Interest Period for such Advance to the sum of the Eurodollar Rate for such
Interest Period plus the Applicable Margin for such Eurodollar Rate Advance in
effect from time to time, payable on the last day of the Interest Period for
such Eurodollar Rate Advance (or, if the Interest Period for such Advance is six
months, accrued interest shall be payable on the day that is three months and on
the day that is six months from the date such Advance was made) or, if earlier,
on the date such Eurodollar Rate Advance shall be Converted or paid in full.
SECTION 2.07. Additional Interest on Advances. The Borrower shall pay
to each Lender, so long as such Lender shall be required under regulations of
the Board of Governors of the Federal Reserve System to maintain reserves with
respect to liabilities or assets consisting of or including Eurocurrency
Liabilities, additional interest on the unpaid principal amount of each
Eurodollar Rate Advance of such Lender, from the date of such Advance until such
principal amount is paid in full or Converted, at an interest rate per annum
equal at all times to the remainder obtained by subtracting (i) the Eurodollar
Rate for the Interest Period for such Advance from (ii) the rate obtained by
dividing such Eurodollar Rate by a percentage equal to 100% minus the Eurodollar
Rate Reserve Percentage of such Lender for such Interest Period, payable on each
date on which interest is payable on such Advance; provided, that no Lender
shall be entitled to demand such additional interest more than 90 days following
the last day of the Interest Period in respect of which such demand is made;
provided further, however, that the foregoing proviso shall in no way limit the
right of any Lender to demand or receive such additional interest to the extent
that such additional interest relates to the retroactive application of the
reserve requirements described above if such demand is made within 90 days after
the implementation of such retroactive reserve requirements. Such additional
interest shall be determined by such Lender and notified to the Borrower through
the Administrative Agent, and such determination shall be conclusive and binding
for all purposes, absent manifest error.
SECTION 2.08. Interest Rate Determination. (a) Each Reference Bank
agrees to furnish to the Administrative Agent timely information for the purpose
of determining each Eurodollar Rate. If any one of the Reference Banks shall not
furnish such timely information to the Administrative Agent for the purpose of
determining any such interest rate, the Administrative Agent shall determine
such interest rate on the basis of timely information furnished by the remaining
Reference Banks.
(b) The Administrative Agent shall give prompt notice to the Borrower
and the Lenders of the applicable interest rate determined by the Administrative
Agent for purposes of Section 2.06(a) or (b), and the applicable rate, if any,
furnished by each Reference Bank for the purpose of determining the applicable
interest rate under Section 2.06(b).
(c) If either or both Reference Banks fail to furnish timely
information to the Administrative Agent for determining the Eurodollar Rate for
any Eurodollar Rate Advances,
(i) the Administrative Agent shall forthwith notify the Borrower
and the Lenders that the interest rate cannot be determined for such
Eurodollar Rate Advances,
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(ii) each such Advance will automatically, on the last day of the
then existing Interest Period therefor, Convert into a Base Rate
Advance (or if such Advance is then a Base Rate Advance, will continue
as a Base Rate Advance), and
(iii) the obligation of the Lenders to make, or to Convert
Advances into, Eurodollar Rate Advances shall be suspended until the
Administrative Agent shall notify the Borrower and the Lenders that the
circumstances causing such suspension no longer exist.
(d) If, with respect to any Eurodollar Rate Advances, the Majority
Lenders notify the Administrative Agent that the Eurodollar Rate for any
Interest Period for such Advances will not adequately reflect the cost to such
Majority Lenders of making, funding or maintaining their respective Eurodollar
Rate Advances for such Interest Period, the Administrative Agent shall forthwith
so notify the Borrower and the Lenders, whereupon
(i) each Eurodollar Rate Advance will automatically, on the last
day of the then existing Interest Period therefor (unless prepaid or
Converted to any Type of Advance other than a Eurodollar Rate Advance
prior to such date), Convert into a Base Rate Advance, and
(ii) the obligation of the Lenders to make, or to Convert Advances
into, Eurodollar Rate Advances shall be suspended until the
Administrative Agent shall notify the Borrower and the Lenders that the
circumstances causing such suspension no longer exist.
SECTION 2.09. Conversion of Advances. (a) Voluntary. The Borrower may
on any Business Day, upon notice given to the Administrative Agent not later
than 10:00 A.M. (Chicago time) on the third Business Day prior to the date of
any proposed Conversion into Eurodollar Rate Advances, and on the date of any
proposed Conversion into Base Rate Advances, and subject to the provisions of
Sections 2.08 and 2.12, Convert all Advances of one Type made in connection with
the same Borrowing into Advances of another Type or Types or Advances of the
same Type having the same or a new Interest Period; provided, however, that any
Conversion of Eurodollar Rate Advances into Base Rate Advances or Eurodollar
Advances having the same or new Interest Periods shall be made on, and only on,
the last day of an Interest Period for such Eurodollar Rate Advances, unless the
Borrower shall also reimburse the Lenders in respect thereof pursuant to Section
8.04(b) on the date of such Conversion. Each such notice of a Conversion shall,
within the restrictions specified above, specify (i) the date of such
Conversion, (ii) the Advances to be Converted, and (iii) if such Conversion is
into, or with respect to, Eurodollar Rate Advances, the duration of the Interest
Period for each such Advance.
(b) Automatic. If the Borrower shall fail to select the Type of any
Advance or the duration of any Interest Period for any Borrowing comprising
Eurodollar Rate Advances in accordance with the provisions contained in the
definition of "Interest Period" in Section 1.01 and Section 2.09(a), the
Administrative Agent will forthwith so notify the Borrower and the Lenders and
such Advances will automatically, on the last day of the then existing Interest
Period therefor, Convert into Base Rate Advances.
SECTION 2.10. Prepayments. The Borrower may, upon at least three
Business Days' notice in the case of any prepayment of Eurodollar Advances or
one Business Day's notice in the case of any prepayment of Base Rate Advances,
to the Administrative Agent stating the proposed date and aggregate principal
amount of the prepayment, and if such notice is given the Borrower shall, prepay
the outstanding principal amounts of the Advances made as part of the same
Borrowing in whole or ratably in part, together with accrued interest to the
date of such prepayment on the principal amount prepaid; provided, however, that
(i) each partial prepayment shall be in an aggregate principal amount not less
than $10,000,000 in the case of any prepayment of Eurodollar Advances or
$5,000,000 in the case of any prepayment of Base Rate Advances, or any integral
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multiple of $1,000,000 in excess thereof, and (ii) in the case of any such
prepayment of a Eurodollar Rate Advance, the Borrower shall be obligated to
reimburse the Lenders in respect thereof pursuant to Section 8.04(b) on the date
of such prepayment.
SECTION 2.11. Increased Costs. (a) If on or after the date of this
Agreement, any Lender determines that (i) the introduction of or any change
(other than any change by way of imposition or increase of reserve requirements,
in the case of Eurodollar Rate Advances, included in the Eurodollar Rate Reserve
Percentage) in or in the interpretation of any law or regulation or (ii) the
compliance with any guideline or request from any central bank or other
governmental authority (whether or not having the force of law) shall increase
the cost to such Lender of agreeing to make or making, funding or maintaining
Eurodollar Rate Advances, then the Borrower shall from time to time, upon demand
by such Lender (with a copy of such demand to the Administrative Agent), pay to
the Administrative Agent for the account of such Lender additional amounts
(without duplication of any amount payable pursuant to Section 2.14) sufficient
to compensate such Lender for such increased cost; provided, that no Lender
shall be entitled to demand such compensation more than 90 days following the
last day of the Interest Period in respect of which such demand is made;
provided further, however, that the foregoing proviso shall in no way limit the
right of any Lender to demand or receive such compensation to the extent that
such compensation relates to the retroactive application of any law, regulation,
guideline or request described in clause (i) or (ii) above if such demand is
made within 90 days after the implementation of such retroactive law,
interpretation, guideline or request. A certificate as to the amount of such
increased cost, submitted to the Borrower and the Administrative Agent by such
Lender, shall be conclusive and binding for all purposes, absent manifest error.
(b) If any Lender determines that, after the date of this Agreement,
compliance with any law or regulation or any guideline or request from any
central bank or other governmental authority (whether or not having the force of
law) regarding capital adequacy requirements affects or would affect the amount
of capital required or expected to be maintained by such Lender or any
corporation controlling such Lender (including, in any event, any determination
after the date of this Agreement by any such governmental authority or central
bank that, for purposes of capital adequacy requirements, any Lender's
Commitment hereunder does not constitute a commitment with an original maturity
of one year or less) and that the amount of such capital is increased by or
based upon the existence of such Lender's commitment to lend hereunder and other
commitments of this type or the Advances made by such Lender, then, upon demand
by such Lender (with a copy of such demand to the Administrative Agent), the
Borrower shall immediately pay to the Administrative Agent for the account of
such Lender, from time to time as specified by such Lender, additional amounts
sufficient to compensate such Lender or such corporation in the light of such
circumstances, to the extent that such Lender determines such increase in
capital to be allocable to the existence of such Lender's commitment to lend
hereunder or the Advances made by such Lender; provided, that no Lender shall be
entitled to demand such compensation more than one year following the payment to
or for the account of such Lender of all other amounts payable hereunder and
under any Note held by such Lender and the termination of such Lender's
Commitment; provided further, however, that the foregoing proviso shall in no
way limit the right of any Lender to demand or receive such compensation to the
extent that such compensation relates to the retroactive application of any law,
regulation, guideline or request described above if such demand is made within
one year after the implementation of such retroactive law, interpretation,
guideline or request. A certificate as to such amounts submitted to the Borrower
and the Administrative Agent by such Lender shall be conclusive and binding, for
all purposes, absent manifest error.
(c) Any Lender claiming compensation pursuant to this Section 2.11
shall use its best efforts (consistent with its internal policy and legal and
regulatory restrictions) to change the jurisdiction of its Applicable Lending
Office if the making of such a change would avoid the need for, or reduce the
amount of, any such compensation that may thereafter accrue and would not, in
the reasonable judgment of such Lender, be otherwise disadvantageous to such
Lender.
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SECTION 2.12. Illegality. Notwithstanding any other provision of this
Agreement, if any Lender shall notify the Administrative Agent that the
introduction of or any change in or in the interpretation of any law or
regulation makes it unlawful, or any central bank or other governmental
authority asserts that it is unlawful, for such Lender or its Eurodollar Lending
Office to perform its obligations hereunder to make Eurodollar Rate Advances or
to fund or maintain Eurodollar Rate Advances hereunder, (i) the obligation of
such Lender to make, or to Convert Advances into, Eurodollar Rate Advances shall
be suspended (subject to the following paragraph of this Section 2.12) until the
Administrative Agent shall notify the Borrower and the Lenders that the
circumstances causing such suspension no longer exist and (ii) all Eurodollar
Rate Advances of such Lender then outstanding shall, on the last day of then
applicable Interest Period (or such earlier date as such Lender shall designate
upon not less than five Business Days prior written notice to the Administrative
Agent), be automatically Converted into Base Rate Advances.
If the obligation of any Lender to make, fund or maintain Eurodollar
Rate Advances has been suspended pursuant to the preceding paragraph, then,
unless and until the Administrative Agent shall notify the Borrower and the
Lenders that the circumstances causing such suspension no longer exist (i) all
Advances that would otherwise be made by such Lender as Eurodollar Rate Advances
shall instead be made as Base Rate Advances and (ii) to the extent that
Eurodollar Rate Advances of such Lender have been Converted into Base Rate
Advances pursuant to the preceding paragraph or made instead as Base Rate
Advances pursuant to the preceding clause (i), all payments and prepayments of
principal that would have otherwise been applied to such Eurodollar Rate
Advances of such Lender shall be applied instead to such Base Rate Advances of
such Lender.
SECTION 2.13. Payments and Computations. (a) The Borrower shall make
each payment hereunder and under the Notes not later than 10:00 A.M. (Chicago
time) on the day when due in U.S. dollars to the Administrative Agent at its
address referred to in Section 8.02 in same day funds without setoff,
counterclaim or other deduction. The Administrative Agent will promptly
thereafter cause to be distributed like funds relating to the payment of
principal or interest or commitment and facility fees ratably (other than
amounts payable pursuant to Section 2.02(c), 2.07, 2.11, 2.14, 2.16(a) or
8.04(b)) to the Lenders for the account of their respective Applicable Lending
Offices, and like funds relating to the payment of any other amount payable to
any Lender to such Lender for the account of its Applicable Lending Office, in
each case to be applied in accordance with the terms of this Agreement. Upon its
acceptance of an Assignment and Acceptance and recording of the information
contained therein in the Register pursuant to Section 8.07(d), from and after
the effective date specified in such Assignment and Acceptance, the
Administrative Agent shall make all payments hereunder and under the Notes in
respect of the interest assigned thereby to the Lender assignee thereunder, and
the parties to such Assignment and Acceptance shall make all appropriate
adjustments in such payments for periods prior to such effective date directly
between themselves.
(b) The Borrower hereby authorizes each Lender, if and to the extent
payment owed to such Lender is not made when due hereunder or under any Note
held by such Lender, to charge from time to time against any or all of the
Borrower's accounts with such Lender any amount so due.
(c) All computations of interest based on the Base Rate shall be made
by the Administrative Agent on the basis of a year of 365 or 366 days, as the
case may be, and all computations of interest based on the Eurodollar Rate or
the Federal Funds Rate and of commitment fees shall be made by the
Administrative Agent, and all computations of interest pursuant to Section 2.07
shall be made by a Lender, on the basis of a year of 360 days, in each case for
the actual number of days (including the first day but excluding the last day)
occurring in the period for which such interest or commitment fees are payable.
Each determination by the Administrative Agent (or, in the case of Section 2.07,
by a Lender) of an interest rate hereunder shall be conclusive and binding for
all purposes, absent manifest error.
(d) Whenever any payment hereunder or under the Notes shall be stated
to be due on a day other than a Business Day, such payment shall be made on the
next succeeding Business Day, and such extension of time shall in such case be
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included in the computation of payment of interest or commitment fee, as the
case may be; provided, however, if such extension would cause payment of
interest on or principal of Eurodollar Rate Advances to be made in the next
following calendar month, such payment shall be made on the next preceding
Business Day.
(e) Unless the Administrative Agent shall have received notice from the
Borrower prior to the date on which any payment is due to the Lenders hereunder
that the Borrower will not make such payment in full, the Administrative Agent
may assume that the Borrower has made such payment in full to the Administrative
Agent on such date and the Administrative Agent may, in reliance upon such
assumption, cause to be distributed to each Lender on such due date an amount
equal to the amount then due such Lender. If and to the extent that the Borrower
shall not have so made such payment in full to the Administrative Agent, each
Lender shall repay to the Administrative Agent forthwith on demand such amount
distributed to such Lender together with interest thereon, for each day from the
date such amount is distributed to such Lender until the date such Lender repays
such amount to the Administrative Agent, at the Federal Funds Rate.
(f) Notwithstanding anything to the contrary contained herein, any
amount payable by the Borrower hereunder or under any Note that is not paid when
due (whether at stated maturity, by acceleration or otherwise) shall (to the
fullest extent permitted by law) bear interest from the date when due until paid
in full at a rate per annum equal at all times to the Base Rate plus 2%, payable
upon demand.
SECTION 2.14. Taxes. (a) Any and all payments by the Borrower hereunder
or under the Notes shall be made, in accordance with Section 2.13, free and
clear of and without deduction for any and all present or future taxes, levies,
imposts, deductions, charges or withholdings, and all liabilities with respect
thereto, excluding, in the case of each Lender and the Administrative Agent,
taxes imposed on its income, and franchise taxes imposed on it, by the
jurisdiction under the laws of which such Lender or the Administrative Agent (as
the case may be) is organized or any political subdivision thereof and, in the
case of each Lender, taxes imposed on its income, and franchise taxes imposed on
it, by the jurisdiction of such Lender's Applicable Lending Office or any
political subdivision thereof (all such non-excluded taxes, levies, imposts,
deductions, charges, withholdings and liabilities being hereinafter referred to
as "Taxes"). If the Borrower shall be required by law to deduct any Taxes from
or in respect of any sum payable hereunder or under any Note to any Lender or
the Administrative Agent, (i) the sum payable shall be increased as may be
necessary so that after making all required deductions (including deductions
applicable to additional sums payable under this Section 2.14) such Lender or
the Administrative Agent (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 taxation authority or other authority in accordance
with applicable law.
(b) In addition, the Borrower agrees to pay any present or future stamp
or documentary taxes or any other excise or property taxes, charges or similar
levies to the extent arising from the execution, delivery or registration of
this Agreement or the Notes (hereinafter referred to as "Other Taxes").
(c) No Lender may claim or demand payment or reimbursement in respect
of any Taxes or Other Taxes pursuant to this Section 2.14 if such Taxes or Other
Taxes, as the case may be, were imposed solely as the result of a voluntary
change in the location of the jurisdiction of such Lender's Applicable Lending
Office.
(d) The Borrower will indemnify each Lender and the Administrative
Agent for the full amount of Taxes or Other Taxes (including, without
limitation, any Taxes or Other Taxes imposed by any jurisdiction on amounts
payable under this Section 2.14) paid by such Lender or the Administrative Agent
(as the case may be) and any liability (including penalties, interest and
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expenses) arising therefrom or with respect thereto, whether or not such Taxes
or Other Taxes were correctly or legally asserted. This indemnification shall be
made within 30 days from the date such Lender or the Administrative Agent (as
the case may be) makes written demand therefor.
(e) Prior to the date of the initial Borrowing in the case of each
Bank, and on the date of the Assignment and Acceptance or Additional Lender
Supplement pursuant to which it became a Lender in the case of each other
Lender, and from time to time thereafter within 30 days from the date of request
if requested by the Borrower or the Administrative Agent, each Lender organized
under the laws of a jurisdiction outside the United States shall provide the
Administrative Agent and the Borrower with the forms prescribed by the Internal
Revenue Service of the United States certifying that such Lender is exempt from
United States withholding taxes with respect to all payments to be made to such
Lender hereunder and under the Notes. If for any reason during the term of this
Agreement, any Lender becomes unable to submit the forms referred to above or
the information or representations contained therein are no longer accurate in
any material respect, such Lender shall notify the Administrative Agent and the
Borrower in writing to that effect. Unless the Borrower and the Administrative
Agent have received forms or other documents satisfactory to them indicating
that payments hereunder or under any Note are not subject to United States
withholding tax, the Borrower or the Administrative Agent shall withhold taxes
from such payments at the applicable statutory rate in the case of payments to
or for any Lender organized under the laws of a jurisdiction outside the United
States and no Lender may claim or demand payment or reimbursement for such
withheld taxes pursuant to this Section 2.14.
(f) Any Lender claiming any additional amounts payable pursuant to this
Section 2.14 shall use its best efforts (consistent with its internal policy and
legal and regulatory restrictions) to change the jurisdiction of its Applicable
Lending Office if the making of such a change would avoid the need for, or
reduce the amount of, any such additional amounts which may thereafter accrue
and would not, in the reasonable judgment of such Lender, be otherwise
disadvantageous to such Lender.
(g) If the Borrower makes any additional payment to any Lender pursuant
to this Section 2.14 in respect of any Taxes or Other Taxes, and such Lender
determines that it has received (i) a refund of such Taxes or Other Taxes or
(ii) a credit against or relief or remission for, or a reduction in the amount
of, any tax or other governmental charge attributable solely to any deduction or
credit for any Taxes or Other Taxes with respect to which it has received
payments under this Section 2.14, such Lender shall, to the extent that it can
do so without prejudice to the retention of such refund, credit, relief,
remission or reduction, pay to the Borrower such amount as such Lender shall
have determined to be attributable to the deduction or withholding of such Taxes
or Other Taxes. If, within one year after the payment of any such amount to the
Borrower, such Lender determines that it was not entitled to such refund,
credit, relief, remission or reduction to the full extent of any payment made
pursuant to the first sentence of this Section 2.14(g), the Borrower shall upon
notice and demand of such Lender promptly repay the amount of such overpayment.
Any determination made by such Lender pursuant to this Section 2.14(g) shall in
the absence of bad faith or manifest error be conclusive, and nothing in this
Section 2.14(g) shall be construed as requiring any Lender to conduct its
business or to arrange or alter in any respect its tax or financial affairs
(except as required by Section 2.14(f)) so that it is entitled to receive such a
refund, credit or reduction or as allowing any person to inspect any records,
including tax returns, of any Lender.
(h) Without prejudice to the survival of any other agreement of the
Borrower or any Lender hereunder, the agreements and obligations of the Borrower
and the Lenders contained in this Section 2.14 shall survive the payment in full
of principal and interest hereunder and under the Notes; provided, that no
Lender shall be entitled to demand any payment under this Section 2.14 more than
one year following the payment to or for the account of such Lender of all other
amounts payable hereunder and under any Note held by such Lender and the
termination of such Lender's Commitment; provided further, however, that the
foregoing proviso shall in no way limit the right of any Lender to demand or
receive any payment under this Section 2.14 to the extent that such payment
relates to the retroactive application of any Taxes or Other Taxes if such
demand is made within one year after the implementation of such Taxes or Other
Taxes.
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SECTION 2.15. Sharing of Payments, Etc. If any Lender shall obtain any
payment (whether voluntary, involuntary, through the exercise of any right of
set-off, or otherwise) on account of the Advances made by it (other than
pursuant to Section 2.02(c), 2.07, 2.11, 2.14, 2.16(a) or 8.04(b)) in excess of
its ratable share of payments on account of the Advances obtained by all the
Lenders, such Lender shall forthwith purchase from the other Lenders such
participations in the Advances made by them as shall be necessary to cause such
purchasing Lender to share the excess payment ratably with each of them,
provided, however, that if all or any portion of such excess payment is
thereafter recovered from such purchasing Lender, such purchase from each Lender
shall be rescinded and such Lender shall repay to the purchasing Lender the
purchase price to the extent of such recovery together with an amount equal to
such Lender's ratable share (according to the proportion of (i) the amount of
such Lender's required repayment to (ii) the total amount so recovered from the
purchasing Lender) of any interest or other amount paid or payable by the
purchasing Lender in respect of the total amount so recovered. The Borrower
agrees that any Lender so purchasing a participation from another Lender
pursuant to this Section 2.15 may, to the fullest extent permitted by law,
exercise all its rights of payment (including the right of set-off) with respect
to such participation as fully as if such Lender were the direct creditor of the
Borrower in the amount of such participation.
SECTION 2.16. Extension of Termination Date. (a) Unless the Termination
Date shall have occurred, the Borrower may request the Lenders, by written
notice to the Administrative Agent not more than 90 days and not less than 60
days prior to the then effective Termination Date, to consent to extension of
the Termination Date to the date which is 364 days after the then effective
Termination Date (or, if such date is not a Business Day, the next preceding
Business Day). Each Lender shall, in its sole discretion, determine whether to
consent to such request and shall notify the Administrative Agent of its
determination not more than 45 days and not less than 30 days prior to the
then-effective Termination Date. Any Lender which fails to give such notice to
the Administrative Agent shall be deemed to have not consented to such request.
If any Lender shall not have consented to such request 30 days prior to the then
effective Termination Date (such Lender being referred to herein as a
"Non-Consenting Lender"), the Administrative Agent shall promptly so notify the
Borrower and the other Lenders, whereupon each other Lender may, not more than
30 days and not less than 25 days prior to the then effective Termination Date,
revoke any consent to such extension previously given by such Lender (in which
case such Lender shall be deemed a Non-Consenting Lender). If such request shall
have been consented to by the Majority Lenders (as determined after giving
effect to the replacement of any Non-Consenting Lender pursuant to Section
8.07(g)), the Administrative Agent shall notify the Borrower and the Lenders in
writing of such consent, and such extension shall become effective (other than
with respect to any Non-Consenting Lender) upon the delivery by the Borrower to
the Administrative Agent and each Lender, on or prior to the then-effective
Termination Date, of (i) a certificate of a duly authorized officer of the
Borrower, dated such date, as to the accuracy, both before and after giving
effect to such proposed extension, of the representations and warranties set
forth in Section 4.01 and as to the absence, both before and after giving effect
to such proposed extension, of any Event of Default or event that with the
giving of notice or the passage of time or both would constitute an Event of
Default, (ii) certified copies of all corporate and governmental approvals, if
any, required to be obtained by the Borrower in connection with such proposed
extension , (iii) new Notes dated such date, substantially in the form of
Exhibit A hereto with the blanks appropriately completed, payable to the order
of each Lender (other than a Non-Consenting Lender) in the principal amount of
such Lender's Commitment and (iv ) an opinion of counsel to the Borrower (who
shall be satisfactory to the Administrative Agent) as to the matters set forth
in Exhibit D, upon giving effect to the extension of the Termination Date and
the new Notes, and such other matters as any Lender, through the Administrative
Agent, may reasonably request, all of the foregoing to be satisfactory in form
and substance to the Administrative Agent. In the event of any such extension of
the Termination Date, the Commitment of each Non-Consenting Lender that has not
been replaced pursuant to Section 8.07(g) shall be terminated in whole as of
such former Termination Date, the aggregate principal amount of all Advances
made by each Non-Consenting Lender, together with accrued and unpaid interest,
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commitment fees and facility fees, and all other amounts payable hereunder to or
for the account of each Non-Consenting Lender shall be due and payable on such
former Termination Date, and upon such reduction and payment of such amounts
each Non-Consenting Lender shall cease to be a party to this Agreement (although
each Non-Consenting Lender shall continue to be entitled to indemnification
pursuant to Section 8.04(c)).
(b) Upon the effectiveness of any extension of the Termination Date
pursuant to subsection (a) above, each reference in Section 4.01(e) and Exhibit
D to (i) the year-end financial statements of the Borrower, (ii) December 31 of
any year, (iii) the quarter-end financial statements of the Borrower and (iv)
the last day of any fiscal quarter (other than December 31) of any year, shall
be deemed to be amended to be references to (A) the year-end financial
statements of the Borrower included in the Borrower's Annual Report on Form 10-K
most recently delivered to the Lenders pursuant to Section 5.01(b)(iii), (B)
December 31 of the year of the financial statements described in clause (A)
above, (C) the fiscal quarter-end financial statements of the Borrower included
in the Borrower's Quarterly Report on Form 10-Q most recently delivered to the
Lenders pursuant to Section 5.01(b)(ii) and (D) the last day of the fiscal
quarter of the financial statements described in clause (C) above, respectively.
SECTION 2.17. Additional Lenders. (a) For a period of 60 days after
extension of a Termination Date pursuant to Section 2.16(a) that has resulted in
a reduction of the aggregate Commitments of the Lenders, the Borrower may
request that one or more additional banks or other Persons (each, an "Additional
Lender") become party to this Agreement as Lenders and that the aggregate amount
of the Commitments of the Lenders be increased to reflect the Commitments
allocated to each such Additional Lender; provided, that the aggregate
Commitments of the Lenders after giving effect to such increase shall not exceed
the aggregate Commitments of the Lenders immediately prior to such former
Termination Date. Addition of an Additional Lender shall be made only with the
written consent of the Administrative Agent (which consent shall not be
unreasonably withheld or delayed) and with the written consent of the Borrower
(which consent may be granted or withheld in its absolute discretion). Each
Additional Lender must be an Eligible Assignee and, without the consent of the
Administrative Agent, the initial Commitment of each Additional Lender shall not
be less than $10,000,000.
(b) Addition of an Additional Lender shall be effected by the
Additional Lender executing and delivering to the Administrative Agent, for its
acceptance and recording in the Register, a duly completed Additional Lender
Supplement in substantially the form of Exhibit G attached hereto. The Borrower
shall execute and deliver to the Administrative Agent for transmittal to such
Additional Lender a Note in substantially the form of Exhibit A attached hereto
in the amount of the Commitment of such Additional Lender. Acceptance by the
Administrative Agent of an Additional Lender is subject to the conditions that
the Administrative Agent shall have received, with a counterpart for each
Lender, (i) a certificate of a duly authorized officer of the Borrower, dated
the effective date of such Additional Lender Supplement, as to the accuracy,
both before and after giving effect to such proposed addition, of the
representations and warranties set forth in Section 4.01 and as to the absence,
both before and after giving effect to such proposed extension, of any Event of
Default or event that with the giving of notice or the passage of time or both
would constitute an Event of Default, (ii) certified copies of all corporate and
governmental approvals, if any, required to be obtained by the Borrower in
connection with such proposed addition, (iii) an opinion of counsel to the
Borrower (who shall be satisfactory to the Administrative Agent) as to the
matters set forth in Exhibit D (appropriately modified to include, in addition
to the other matters set forth therein, such Additional Lender Supplement and
the new Note), and such other matters as any Lender, through the Administrative
Agent, may reasonably request, and (iv) such other certificates and documents as
the Administrative Agent may reasonably request, all of the foregoing to be
satisfactory in form and substance to the Administrative Agent. Upon execution
and delivery of the Additional Lender Supplement, acceptance by the
Administrative Agent and recording in the Register, from and after the effective
date specified in such Additional Lender Supplement, such Additional Lender
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shall be a party hereto and shall, to the extent of the Commitment specified in
such Additional Lender Supplement, have the rights and obligations of a Lender
hereunder.
(c) If, at the time an Additional Lender is to become party to this
Agreement, the continuing Lenders have any outstanding Advances, such Additional
Lender shall offer to purchase from each continuing Lender, effective as of the
date such Additional Lender becomes party to this Agreement, a portion of each
continuing Lender's outstanding Advances, in such amounts as will have the
result that, immediately after giving effect to such Additional Lender becoming
party to this Agreement and to such purchases, each Lender (including the
Additional Lender) shall share in the outstanding Advances in the same
proportion as their respective Commitments. The Additional Lender shall offer in
writing to purchase the requisite portion of each continuing Lender's
outstanding Advances, at a price equal to the outstanding principal amount
thereof together with accrued and unpaid interest thereon to the date of
purchase, and a continuing Lender shall not unreasonably decline to accept such
offer. Each such purchase shall be made in accordance with Section 8.07 (with
the related Assignment and Acceptance modified, mutatis mutandis, to reflect
that such purchase is not a purchase of any portion of the Commitment of the
continuing Lender). Such purchases shall not be subject to the provisions of
clause (ii) of Section 8.07(a), and the Borrower shall be responsible for all
amounts payable to the Administrative Agent pursuant to clause (iv) of Section
8.07(a). The Borrower shall pay to each continuing Lender on demand any amount
that would be payable to such continuing Lender pursuant to Section 8.04(b)
(which for this purpose shall be applied as if such assignment were a prepayment
of the Advances assigned by such continuing Lender), and shall reimburse each
continuing Lender on demand for all reasonable fees and expenses (including
reasonable fees and expenses of counsel) incurred by it in connection with such
assignment.
ARTICLE III
CONDITIONS OF LENDING
SECTION 3.01. Conditions Precedent to Initial Advances. The obligation
of each Lender to make its initial Advance is subject to the satisfaction, prior
to or concurrently with, the making of such initial Advance, of each of the
following conditions precedent:
(a) Documents and Other Agreements. The Administrative Agent shall have
received on or before the day of the initial Borrowing the following, each dated
the same date, in form and substance satisfactory to the Administrative Agent
and (except for the Notes) with one copy for each Lender:
(i) The Notes payable to the order of each of the Lenders,
respectively;
(ii) Certified copies of the resolutions of the Board of Directors
of the Borrower approving the transactions contemplated by this
Agreement and the Notes, and of all documents evidencing other
necessary corporate action with respect to this Agreement and the
Notes;
(iii) A certificate of the Secretary or an Assistant Secretary of
the Borrower certifying (A) the names and true signatures of the
officers of the Borrower authorized to sign this Agreement and the
Notes and the other documents to be delivered hereunder; (B) that
attached thereto are true and correct copies of the Restated Articles
of Incorporation and the By-laws of the Borrower, in each case in
effect on such date; and (C) that attached thereto are true and correct
copies of all governmental and regulatory authorizations and approvals
required for the due execution, delivery and performance of this
Agreement and the Notes, including, without limitation, the Application
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for Authorization filed with FERC by the Borrower (the "FERC
Application") and the Authorization issued by FERC approving the FERC
Application (the "FERC Authorization");
(iv) Copies of the financial statements referred to in Section
4.01(e);
(v) A certificate signed by either the chief financial officer,
principal accounting officer or treasurer of the Borrower stating that
(A) the representations and warranties contained in Section 4.01 are
correct on and as of the date of such certificate as though made on and
as of such date, (B) no event has occurred and is continuing on the
date of such certificate that constitutes an Event of Default or would
constitute an Event of Default but for the requirement that notice be
given or time elapse or both and (C) stating the specific provision of
the FERC Application or the FERC Authorization pursuant to which this
Agreement is authorized and stating that the Borrower is in compliance
with such provision;
(vi) A favorable opinion of Xxxxxxx Xxxxx Xxxxxxx & Xxxxxxxxx,
special counsel for the Borrower, substantially in the form of Exhibit
D hereto; and
(vii) A favorable opinion of Xxxx Xxxxx Xxxx & XxXxxx LLP, counsel
for the Administrative Agent, substantially in the form of Exhibit E
hereto.
(b) Termination of Prior Credit Facility. The Administrative Agent
shall have received evidence of (i) the payment in full of all obligations of
the Borrower under the Existing Credit Agreements, and (ii) the termination of
the "Commitments" under the Existing Credit Agreements.
SECTION 3.02. Conditions Precedent to Certain Borrowings. The
obligation of each Lender to make an Advance on the occasion of each Borrowing
(including the initial Borrowing) that would increase the aggregate amount of
Advances outstanding shall be subject to the further conditions precedent that
on the date of such Borrowing the following statements shall be true, and each
of the giving of the applicable Notice of a Borrowing and the acceptance by the
Borrower of the proceeds of such Borrowing shall constitute a representation and
warranty by the Borrower that on the date of such Borrowing such statements are
true:
(A) The representations and warranties contained in Section 4.01
are correct on and as of the date of such Borrowing, before and after
giving effect to such Borrowing and to the application of the proceeds
therefrom, as though made on and as of such date; and
(B) No event has occurred and is continuing, or would result from
such Borrowing or from the application of the proceeds therefrom, that
constitutes an Event of Default or would constitute an Event of Default
but for the requirement that notice be given or time elapse or both (it
being understood for clarification that (i) without limiting the
foregoing, it is a condition of this clause (B) that the Borrower shall
be in compliance with Section 5.01(a)(iv), Section 5.02(a) and Section
5.02(c) upon giving effect to such Borrowing and (ii) the conditions of
this clause (B) shall apply whether or not the respective Commitments
of the Lenders have been terminated pursuant to Section 6.01).
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ARTICLE IV
REPRESENTATIONS AND WARRANTIES
SECTION 4.01. Representations and Warranties of the Borrower. The
Borrower represents and warrants as follows:
(a) The Borrower is a corporation duly organized. validly existing and
in good standing under the laws of the Commonwealth of Pennsylvania.
(b) The execution, delivery and performance by the Borrower of this
Agreement and the Notes are within the Borrower's corporate powers, have been
duly authorized by all necessary corporate action, and do not and will not
contravene (i) the Borrower's Restated Articles of Incorporation or By-laws,
(ii) applicable law or (iii) any contractual or legal restriction binding on or
affecting the Borrower or its properties.
(c) No authorization or approval or other action by, and no notice to
or filing with, any governmental authority or regulatory body is required for
the due execution, delivery and performance by the Borrower of this Agreement or
the Notes except for the filing of the FERC Application with, and the final
approval of, and the FERC Authorization issued by, FERC, which filing has been
duly made and which final approval and FERC Authorization have been duly
obtained; such FERC Authorization is in full force and effect and is final; and
on and after the date of the initial Borrowing hereunder, the action of FERC
approving the FERC Application shall no longer be subject to appeal.
(d) This Agreement is, and the Notes when delivered hereunder will be,
legal, valid and binding obligations of the Borrower enforceable against the
Borrower in accordance with their respective terms, except as the enforceability
thereof may be limited by equitable principles or bankruptcy, insolvency,
reorganization, moratorium or similar laws affecting the enforcement of
creditors' rights generally.
(e) The consolidated balance sheet of the Borrower and its Subsidiaries
as at December 31, 1998, and the related statements of income and retained
earnings and of cash flows of the Borrower and its Subsidiaries for the fiscal
year then ended, certified by Pricewaterhouse Coopers LLP, and the unaudited
consolidated balance sheet of the Borrower and its Subsidiaries as at June 30,
1999, and the related unaudited statements of income for the six-month period
then ended, copies of which have been furnished to each Lender, fairly present
in all material respects (subject, in the case of such balance sheets and
statements of income for the period ended June 30, 1999, to year-end
adjustments) the consolidated financial condition of the Borrower and its
Subsidiaries as at such dates and the consolidated results of the operations of
the Borrower and its Subsidiaries for the periods ended on such dates, all in
accordance with GAAP, and since June 30, 1999, there has been no Material
Adverse Change.
(f) Except as disclosed in the Borrower's Annual, Quarterly or Current
Reports, each as filed with the Securities and Exchange Commission and delivered
to the Lenders (including reports filed prior to the date of execution and
delivery of this Agreement and reports delivered to the Lenders pursuant to
Section 5.01(b)), there is no pending or threatened action, investigation or
proceeding affecting the Borrower or any of its Subsidiaries before any court,
governmental agency or arbitrator that may reasonably be anticipated to have a
Material Adverse Effect. There is no pending or threatened action or proceeding
against the Borrower or its Subsidiaries that purports to affect the legality,
validity, binding effect or enforceability of this Agreement or any Note.
(g) No proceeds of any Advance have been or will be used directly or
indirectly in connection with the acquisition of in excess of 5% of any class of
equity securities that is registered pursuant to Section 12 of the Exchange Act
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or any transaction subject to the requirements of Section 13 or 14 of the
Exchange Act.
(h) The Borrower is not engaged in the business of extending credit for
the purpose of purchasing or carrying margin stock (within the meaning of
Regulation U issued by the Board of Governors of the Federal Reserve System),
and no proceeds of any Advance will be used to purchase or carry any margin
stock or to extend credit to others for the purpose of purchasing or carrying
any margin stock. Not more than 25% of the value of the assets of the Borrower
and its Principal Subsidiaries is represented by margin stock.
(i) The Borrower (i) is exempt from the provisions of the Public
Utility Holding Company Act of 1935, as amended, other than Section 9(a)(2)
thereof, pursuant to Section 3(a)(2) thereof, and (ii) 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.
(j) During the twelve consecutive month period prior to the date of the
execution and delivery of this Agreement and prior to the date of any Borrowing
under this Agreement, no steps have been taken to terminate any Plan, and no
contribution failure by the Borrower or any member of the Controlled Group has
occurred with respect to any Plan. No condition exists or event or transaction
has occurred with respect to any Plan (including any Multiemployer Plan) which
might result in the incurrence by the Borrower or any member of the Controlled
Group of any material liability, fine or penalty.
(k) The Borrower is reviewing its operations and those of its
Subsidiaries with a view to assessing whether its business, or the business of
any of its Subsidiaries (i) will be vulnerable to a Year 2000 Problem or (ii)
will be vulnerable to the effects of a Year 2000 Problem suffered by the
Borrower's or any of its Subsidiaries' major counterparties, in the case of (ii)
as described in the Borrower's Quarterly Report on Form 10-Q for the quarter
ended June 30, 1999. The Borrower represents and warrants that it does not
believe that any Year 2000 Problem will impair the Borrower's ability to pay
principal or interest on the Notes in accordance with their terms.
ARTICLE V
COVENANTS OF THE BORROWER
SECTION 5.01. Affirmative Covenants. So long as any Note or any amount
payable by the Borrower hereunder shall remain unpaid or any Lender shall have
any Commitment hereunder (except with respect to subsection (a)(iv), which shall
be applicable only as of the date hereof and at any time that any Advance is
outstanding hereunder), the Borrower will, and, in the case of Section 5.01(a),
will cause its Principal Subsidiaries to, unless the Majority Lenders shall
otherwise consent in writing:
(a) Keep Books; Corporate Existence; Maintenance of Properties;
Compliance with Laws; Insurance; Taxes.
(i) keep proper books of record and account, all in accordance with
generally accepted accounting principles;
(ii) subject to Section 5.02(b), preserve and keep in full force
and effect its existence;
(iii) maintain and preserve all of its properties (except such
properties the failure of which to maintain or preserve would not have,
individually or in the aggregate, a Material Adverse Effect) which are
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used or useful in the conduct of its business in good working order and
condition, ordinary wear and tear excepted;
(iv) comply in all material respects with the requirements of all
applicable laws, rules, regulations and orders (including those of any
governmental authority and including with respect to environmental
matters) to the extent the failure to so comply, individually or in the
aggregate, would have either a Material Adverse Effect or a material
adverse effect on the ability of the Borrower to perform its
obligations under this Agreement and the Notes;
(v) maintain insurance with responsible and reputable insurance
companies or associations, or self-insure, as the case may be, in each
case in such amounts and covering such contingencies, casualties and
risks as is customarily carried by or self-insured against by companies
engaged in similar businesses and owning similar properties in the same
general areas in which the Borrower and its Principal Subsidiaries
operate;
(vi) at any reasonable time and from time to time, pursuant to
prior notice delivered to the Borrower, permit any Lender, or any
agents or representatives of any thereof, to examine and, at such
Lender's expense, make copies of, and abstracts from the records and
books of account of, and visit the properties of, the Borrower and any
of its Principal Subsidiaries and to discuss the affairs, finances and
accounts of the Borrower and any of its Subsidiaries with any of their
respective officers; provided, that any non-public information (which
has been identified as such by the Borrower) obtained by any Lender, or
any of their respective agents or representatives pursuant to this
subsection (vi) shall be treated confidentially by such Person;
provided, further, that such Person may disclose such information to
any other party to this Agreement, its examiners, affiliates, outside
auditors, counsel or other professional advisors in connection with the
Agreement or if otherwise required to do so by law or regulatory
process;
(vii) use the proceeds of the Advances for general corporate
purposes (including, without limitation, the refinancing of its
commercial paper, the repayment of outstanding Advances, and the making
of acquisitions) but in no event for any purpose which would be
contrary to clause (g) or clause (h) of Section 4.01;
(viii) take the actions and commit the resources deemed necessary
by the National Electric Reliance Council ("NERC"), the Mid-Atlantic
Area Counsel, the Nuclear Regulatory Commission and the PUC to mitigate
against the Year 2000 Problem; and
(ix) at the request of the Administrative Agent, provide the
Administrative Agent with any reports submitted by the Borrower to NERC
relating to the Year 2000 Problem, within a reasonable time after such
request.
(b) Reporting Requirements. Furnish to the Lenders:
(i) as soon as possible, and in any event within 5 Business Days
after the occurrence of each Event of Default or each event which, with
the giving of notice or lapse of time, or both, would constitute an
Event of Default, continuing on the date of such statement, a statement
of an authorized officer of the Borrower setting forth details of such
Event of Default or event and the action which the Borrower proposes to
take with respect thereto;
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(ii) as soon as available and in any event within 60 days after the
end of each of the first three quarters of each fiscal year of the
Borrower, a copy of the Borrower's Quarterly Report on Form 10-Q filed
with the Securities and Exchange Commission with respect to such
quarter, together with a certificate of an authorized officer of the
Borrower stating that no Event of Default, or event which, with notice
or lapse of time or both, would constitute an Event of Default, has
occurred and is continuing or, if any Event of Default or such event
has occurred and is continuing, a statement as to the nature thereof
and the action which the Borrower proposes to take with respect
thereto;
(iii) as soon as available and in any event within 105 days after
the end of each fiscal year of the Borrower, a copy of the Borrower's
Annual Report on Form 10-K filed with the Securities and Exchange
Commission with respect to such fiscal year, together with a
certificate of an authorized officer of the Borrower stating that no
Event of Default, or event which, with notice of lapse of time or both,
would constitute an Event of Default, has occurred and is continuing
or, if any Event of Default or such event has occurred and is
continuing, a statement as to the nature thereof and the action which
the Borrower proposes to take with respect thereto;
(iv) concurrently with the delivery of the annual and quarterly
reports referred to in Sections 5.01(b)(ii) and 5.01(b)(iii), a
compliance certificate in substantially the form set forth in Exhibit
F, duly completed and signed by the Chief Financial Officer, Treasurer
or an Assistant Treasurer of the Borrower;
(v) except as otherwise provided in subsections (ii) and (iii)
above, promptly after the sending or filing thereof, copies of all
reports that the Borrower sends to any of its security holders, and
copies of all Reports on Form 10-K, 10-Q or 8-K, and registration
statements and prospectuses that the Borrower or any of its
Subsidiaries files with the Securities and Exchange Commission or any
national securities exchange (except to the extent that any such
registration statement or prospectus relates solely to the issuance of
securities pursuant to employee or dividend reinvestment plans of the
Borrower or such Subsidiary);
(vi) promptly upon becoming aware of the institution of any steps
by the Borrower or any other Person to terminate any Plan, or the
failure to make a required contribution to any Plan if such failure is
sufficient to give rise to a lien under section 302(f) of ERISA, or the
taking of any action with respect to a Plan which could result in the
requirement that the Borrower furnish a bond or other security to the
PBGC or such Plan, or the occurrence of any event with respect to any
Plan, which could result in the incurrence by the Borrower or any
member of the Controlled Group of any material liability, fine or
penalty; and
(vii) such other information respecting the condition, operations,
business or prospects, financial or otherwise, of the Borrower or any
of its Subsidiaries as any Lender, through the Administrative Agent,
may from time to time reasonably request.
SECTION 5.02. Negative Covenants. So long as any Note or any amount
payable by the Borrower hereunder shall remain unpaid or any Lender shall have
any Commitment hereunder (except with respect to subsection (a), which shall be
applicable only as of the date hereof and at any time any Advance is outstanding
hereunder), the Borrower will not, without the written consent of the Majority
Lenders:
(a) Limitation on Liens. Create, incur, assume or suffer to exist, or
permit any of its Principal Subsidiaries to create, incur, assume or suffer to
exist, any Lien on its respective property, revenues or assets, whether now
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owned or hereafter acquired except (i) Liens upon or in any property acquired by
the Borrower or any of its Principal Subsidiaries in the ordinary course of
business to secure the purchase price of such property or to secure any
obligation incurred solely for the purpose of financing the acquisition of such
property, (ii) Liens existing on such property at the time of its acquisition
(other than any such Lien created in contemplation of such acquisition unless
permitted by the preceding clause (i)), (iii) Liens granted under the Mortgage
and "excepted encumbrances" as defined in the Mortgage, (iv) Liens granted in
connection with any financing arrangement for the purchase of nuclear fuel or
the financing of pollution control facilities, limited to the fuel or facilities
so purchased or acquired, (v) Liens arising in connection with sales or
transfers of, or financing secured by, accounts receivable or related contracts,
(vi) Liens securing the Borrower's notes collateralized solely by mortgage bonds
of the Borrower issued under the terms of the Mortgage, (vii) Liens arising in
connection with sale and leaseback transactions, but only to the extent (x) the
proceeds received by the Borrower or such Principal Subsidiary from such sale
shall immediately be applied to retire mortgage bonds of the Borrower issued
under the terms of the Mortgage, or (y) the aggregate purchase price of assets
sold pursuant to such sale and leaseback transactions where such proceeds are
not so applied shall not exceed $1,000,000,000, (viii) Liens granted by a
Special Purpose Subsidiary to secure Nonrecourse Transition Bond Debt of such
Special Purpose Subsidiary, and (ix) Liens, other than those described in
clauses (i) through (viii) of this subsection granted by the Borrower or any of
its Principal Subsidiaries in the ordinary course of business securing Debt of
the Borrower and its Principal Subsidiaries in an amount not to exceed
$50,000,000 in the aggregate at any one time outstanding.
(b) Mergers and Consolidations; Disposition of Assets. Merge with or
into or consolidate with or into, or sell, assign, lease or otherwise dispose of
(whether in one transaction or in a series of transactions) all or substantially
all of its assets (whether now owned or hereafter acquired) to any Person or
permit any Principal Subsidiary to do so, except that (i) the Borrower or any
Principal Subsidiary may merge with or into or consolidate with or transfer
assets to any other Principal Subsidiary, (ii) any Principal Subsidiary may
merge with or into or consolidate with or transfer assets to the Borrower and
(iii) the Borrower may merge with or into or consolidate with or transfer assets
to any other Person; provided in each case, immediately thereafter in giving
effect thereto, no Event of Default or event that would, with the giving of
notice or the passage of time or both constitute an Event of Default shall have
occurred and be continuing and (A) in the case of any such merger, consolidation
or transfer of assets to which the Borrower is a party, either (x) the Borrower
shall be the surviving corporation or (y) the surviving corporation shall be an
Eligible Successor and shall have assumed all of the obligations of the Borrower
under this Agreement and the Notes pursuant to a written instrument in form and
substance satisfactory to the Administrative Agent and (B) subject to clause (A)
above, in the case of any such merger to which a Principal Subsidiary is a
party, a Principal Subsidiary shall be the surviving corporation.
(c) Financial Covenant. Permit Consolidated Adjusted Total Debt to
exceed 65% of Consolidated Adjusted Total Capitalization at any time.
(d) Continuation of Businesses.
(i) Generation Business. (A) Cease to own (through the Borrower or
wholly-owned Subsidiaries) the business of generating electricity, or
(B) reduce the net installed electric generating capacity (summer
rating) of the electricity generation business owned by the Borrower
and its wholly-owned Subsidiaries taken as a whole to less than 7821
Megawatts.
(ii) Distribution, Transmission and Gas Businesses. Cease to own
(directly by the Borrower, and not through Subsidiaries) the business
of distributing electricity to end-users, the business of transmitting
electricity, or the businesses of transmitting and distributing natural
gas, each substantially as conducted by the Borrower as of the date of
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this Agreement (and the Borrower warrants that as of the date of this
Agreement substantially all of such businesses conducted by the
Borrower on a consolidated basis, and the assets relating thereto, are
operated and owned by the Borrower directly and not through
Subsidiaries).
ARTICLE VI
EVENTS OF DEFAULT
SECTION 6.01. Events of Default. If any of the following events
("Events of Default") shall occur and be continuing:
(a) The Borrower shall fail to pay any principal of any Advance when
the same becomes due and payable, or interest thereon or any other amount
payable under this Agreement or any of the Notes within three Business Days
after the same becomes due and payable; or
(b) Any representation or warranty made by the Borrower herein or by
the Borrower (or any of its officers) pursuant to the terms of this Agreement
shall prove to have been incorrect or misleading in any material respect when
made; or
(c) The Borrower shall fail to perform or observe (i) any term,
covenant or agreement contained in Section 5.02, Section 5.01(a)(vii) or Section
5.01(b)(i), or (ii) any other term, covenant or agreement contained in this
Agreement on its part to be performed or observed if the failure to perform or
observe such other term, covenant or agreement shall remain unremedied for 30
days after written notice thereof shall have been given to the Borrower by the
Administrative Agent (which notice shall be given by the Administrative Agent at
the written request of any Lender); or
(d) The Borrower or any Principal Subsidiary shall fail to pay any
principal of or premium or interest on any Debt that is outstanding in a
principal amount in excess of $50,000,000 in the aggregate (but excluding Debt
evidenced by the Notes and Nonrecourse Transition Bond Debt) of the Borrower or
such Principal Subsidiary (as the case may be) when the same becomes due and
payable (whether by scheduled maturity, required prepayment, acceleration,
demand or otherwise), and such failure shall continue after the applicable grace
period, if any, specified in the agreement or instrument relating to such Debt;
or any other event shall occur or condition shall exist under any agreement or
instrument relating to any such Debt and shall continue after the applicable
grace period, if any, specified in such agreement or instrument, if the effect
of such event or condition is to accelerate, or to permit the acceleration of,
the maturity of such Debt; or any such Debt shall be declared to be due and
payable, or required to be prepaid (other than by a regularly scheduled required
prepayment), prior to the stated maturity thereof, other than any acceleration
of any Debt secured by equipment leases or fuel leases of the Borrower or a
Principal Subsidiary as a result of the occurrence of any event requiring a
prepayment (whether or not characterized as such) thereunder, which prepayment
will not result in a Material Adverse Change; or
(e) The Borrower or any Principal Subsidiary (other than a Special
Purpose Subsidiary) shall generally not pay its debts as such debts become due,
or shall admit in writing its inability to pay its debts generally, or shall
make a general assignment for the benefit of creditors; or any proceeding shall
be instituted by or against the Borrower or any Principal Subsidiary (other than
a Special Purpose Subsidiary) seeking to adjudicate it a bankrupt or insolvent,
or seeking liquidation, winding up, reorganization, arrangement, adjustment,
protection, relief, or composition of it or its debts under any law relating to
bankruptcy, insolvency or reorganization or relief of debtors, or seeking the
entry of an order for relief or the appointment of a receiver, trustee,
custodian or other similar official for it or for any substantial part of its
property and, in the case of any such proceeding instituted against it (but not
instituted by it), either such proceeding shall remain undismissed or unstayed
for a period of 60 days, or any of the actions sought in such proceeding
(including, without limitation, the entry of an order for relief against, or the
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appointment of a receiver, trustee, custodian or other similar official for, it
or for any substantial part of its property,) shall occur; or the Borrower or
any Principal Subsidiary (other than a Special Purpose Subsidiary) shall take
any corporate action to authorize or to consent to any of the actions set forth
above in this subsection (e); or
(f) One or more judgments or orders for the payment of money in an
aggregate amount exceeding $50,000,000 (excluding any such judgments or orders
which are fully covered by insurance, subject to any customary deductible, and
under which the applicable insurance carrier has acknowledged such full coverage
in writing) shall be rendered against the Borrower or any Principal Subsidiary
and either (i) enforcement proceedings shall have been commenced by any creditor
upon such judgment or order or (ii) there shall be any period of 30 consecutive
days during which a stay of enforcement of such judgment or order, by reason of
a pending appeal or otherwise, shall not be in effect; or
(g) (i) any Reportable Event that the Majority Lenders determine in
good faith might constitute grounds for the termination of any Plan or for the
appointment by the appropriate United States District Court of a trustee to
administer a Plan shall have occurred and be continuing 30 days after written
notice to such effect shall have been given to the Borrower by the
Administrative Agent or (ii) any Plan shall be terminated, or (iii) a Trustee
shall be appointed by an appropriate United States District Court to administer
any Plan or (iv) the PBGC shall institute proceedings to terminate any Plan or
to appoint a trustee to administer any Plan; provided, however that on the date
of any event described in clauses (i) through (iv) above the Unfunded
Liabilities of such Plan exceed $20,000,000; or
(h) any "Event of Default" shall occur under the Revolving Credit
Agreement;
then, and in any such event, the Administrative Agent (i) shall at the request,
or may with the consent, of the Majority Lenders, by notice to the Borrower,
declare the respective Commitments of the Lenders to be terminated, whereupon
the same shall forthwith terminate, and (ii) shall at the request, or may with
the consent, of the Majority Lenders, by notice to the Borrower, declare the
principal amount outstanding under the Notes, all interest thereon and all other
amounts payable under this Agreement to be forthwith due and payable, whereupon
the principal amount outstanding under the Notes, all such interest and all such
amounts shall become and be forthwith due and payable, without presentment,
demand, protest or further notice of any kind, all of which are hereby expressly
waived by the Borrower; provided, however, that in the event of an actual or
deemed entry of an order for relief with respect to the Borrower or any
Principal Subsidiary under the Federal Bankruptcy Code, (A) the obligation of
each Lender to make Advances shall automatically be terminated and (B) the
principal amount outstanding under the Notes, all such interest and all such
amounts shall automatically and immediately become due and payable, without
presentment, demand, protest or any notice of any kind, all of which are hereby
expressly waived by the Borrower.
ARTICLE VII
THE AGENTS
SECTION 7.01. Authorization and Action. Each Lender hereby appoints and
authorizes the Administrative Agent to take such action as administrative agent
on its behalf and to exercise such powers under this Agreement as are delegated
to the Administrative Agent by the terms hereof, together with such powers as
are reasonably incidental thereto. As to any matters not expressly provided for
by this Agreement (including, without limitation, enforcement or collection of
the Notes), 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 Majority Lenders, and such instructions shall be
binding upon all Lenders and all holders of Notes; provided, however, that the
Administrative Agent shall not be required to take any action which exposes the
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Administrative Agent to personal liability or which is contrary to this
Agreement or applicable law. The Administrative Agent agrees to give to each
Lender prompt notice of each notice given to it by the Borrower pursuant to the
terms of this Agreement.
SECTION 7.02. Agents' Reliance, Etc. Neither the Administrative Agent
nor any of its directors, officers, agents or employees shall be liable for any
action taken or omitted to be taken by it or them under or in connection with
this Agreement, except for its or their respective own gross negligence or
willful misconduct. Without limitation of the generality of the foregoing: (i)
the Administrative Agent may treat the payee of any Note as the holder thereof
until the Administrative Agent receives and accepts an Assignment and Acceptance
entered into by the Lender which is the payee of such Note, as assignor, and an
Eligible Assignee, as assignee, as provided in Section 8.07; (ii) the
Administrative Agent may consult with legal counsel (including counsel for the
Borrower), independent public accountants and other experts selected by it and
shall not be liable for any action taken or omitted to be taken in good faith by
it in accordance with the advice of such counsel, accountants or experts; (iii)
the Administrative Agent makes no warranty or representation to any Lender and
shall not be responsible to any Lender for any statements, warranties or
representations (whether written or oral) made in or in connection with this
Agreement; (iv) the Administrative Agent shall not have any duty to ascertain or
to inquire as to the performance or observance of any of the terms, covenants or
conditions of this Agreement on the part of the Borrower or to inspect the
property (including the books and records) of the Borrower; (v) the
Administrative Agent shall not be responsible to any Lender for the due
execution, legality, validity, enforceability, genuineness, sufficiency or value
of this Agreement or any other instrument or document furnished pursuant hereto;
and (vi) the Administrative Agent shall not incur any liability under or in
respect of this Agreement by acting upon any notice, consent, certificate or
other instrument or writing (which may be by telecopier, telegram, cable or
telex) believed by it to be genuine and signed or sent by the proper party or
parties.
SECTION 7.03. Agents and Affiliates. With respect to its Commitment,
Advances and Notes, each of First Chicago and Citibank, N.A. shall have the same
rights and powers under this Agreement as any other Lender and may exercise the
same as though it were not an Agent; and the term "Lender" or "Lenders" shall,
unless otherwise expressly indicated, include each of First Chicago and
Citibank, N.A. in its individual capacity. Each of First Chicago and Citibank,
N.A. and their affiliates may accept deposits from, lend money to, act as
trustee under indentures of, and generally engage in any kind of business with,
the Borrower, any of its subsidiaries and any Person who may do business with or
own securities of the Borrower or any such subsidiary, all as if it were not an
Agent and without any duty to account therefor to the Lenders.
SECTION 7.04. Lender Credit Decision. Each Lender acknowledges that it
has, independently and without reliance upon the Administrative Agent or any
other Lender and based on the financial statements referred to in Section
4.01(e) and such other documents and information as it has deemed appropriate,
made its own credit analysis and decision to enter into this Agreement. Each
Lender also acknowledges 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
credit decisions in taking or not taking action under this Agreement.
SECTION 7.05. Indemnification. The Lenders agree to indemnify each
Agent (to the extent not reimbursed by the Borrower), ratably according to the
respective principal amounts of the Notes then held by each of the Lenders (or
if no Notes are at the time outstanding, ratably according to the respective
amounts of their Commitments), from and against any and all liabilities,
obligations, losses, damages, penalties, actions, judgments, suits, costs,
expenses or disbursements of any kind or nature whatsoever which may be imposed
on, incurred by, or asserted against any such Agent in any way relating to or
arising out of this Agreement or any action taken or omitted by any such Agent
under this Agreement, provided that no Lender shall be liable for any portion of
such liabilities, obligations, losses, damages, penalties, actions, judgments,
suits, costs, expenses or disbursements resulting from such Agent's gross
negligence or willful misconduct. Without limitation of the foregoing, each
Lender agrees to reimburse each such Agent promptly upon demand for its ratable
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share of any out-of-pocket expenses (including reasonable counsel fees) incurred
by such Agent in connection with the preparation, execution, delivery,
administration, modification, amendment or enforcement (whether through
negotiations, legal proceedings or otherwise) of, or legal advice in respect of
rights or responsibilities under, this Agreement, to the extent that such
expenses are reimbursable by the Borrower but for which such Agent is not
reimbursed by the Borrower.
SECTION 7.06. Successor Administrative Agent. The Administrative Agent
may resign at any time by giving written notice thereof to the Lenders and the
Borrower and may be removed at any time with or without cause by the Majority
Lenders. Upon any such resignation or removal, the Majority Lenders shall have
the right to appoint a successor Administrative Agent. If no successor
Administrative Agent shall have been so appointed by the Majority Lenders, and
shall have accepted such appointment, within 30 days after the retiring
Administrative Agent's giving of notice of resignation or the Majority Lenders'
removal of the retiring Administrative Agent, then the retiring Administrative
Agent may, on behalf of the Lenders, appoint a successor Administrative Agent,
which shall be a commercial bank described in clause (i) or (ii) of the
definition of "Eligible Assignee" and having a combined capital and surplus of
at least $150,000,000. Upon the acceptance of any appointment as Administrative
Agent hereunder by a successor Administrative Agent, such successor
Administrative Agent shall thereupon succeed to and become vested with all the
rights, powers, privileges and duties of the retiring Administrative Agent, and
the retiring Administrative Agent shall be discharged from its duties and
obligations under this Agreement. After any retiring Administrative Agent's
resignation or removal hereunder as Administrative Agent, the provisions of this
Article VII shall inure to its benefit as to any actions taken or omitted to be
taken by it while it was Administrative Agent under this Agreement.
Notwithstanding the foregoing, if no Event of Default, and no event that with
the giving of notice or the passage of time, or both, would constitute an Event
of Default, shall have occurred and be continuing, then no successor
Administrative Agent shall be appointed under this Section 7.06 without the
prior written consent of the Borrower, which consent shall not be unreasonably
withheld or delayed.
SECTION 7.07. Documentation Agent and Lead Arranger. The titles
"Documentation Agent" and "Lead Arranger" are purely honorific, and the
"Documentation Agent" and the "Lead Arranger" shall have no duties or
responsibilities in such capacity.
ARTICLE VIII
MISCELLANEOUS
SECTION 8.01. Amendments, Etc. No amendment or waiver of any provision
of this Agreement or the Notes, nor consent to any departure by the Borrower
therefrom, shall in any event be effective unless the same shall be in writing
and signed by the Majority Lenders, and then such waiver or consent shall be
effective only in the specific instance and for the specific purpose for which
given; provided, however, that no amendment, waiver or consent shall, unless in
writing and signed by all the Lenders (other than any Lender that is the
Borrower or an Affiliate of the Borrower), do any of the following: (a) waive
any of the conditions specified in Section 3.01 or 3.02, (b) increase the
Commitments of the Lenders or subject the Lenders to any additional obligations,
(c) reduce the principal of, or interest on, the Notes or any fees or other
amounts payable hereunder, (d) postpone any date fixed for any payment of
principal of, or interest on, the Notes or any fees or other amounts payable
hereunder, (e) change the percentage of the Commitments or of the aggregate
unpaid principal amount of the Notes, or the number of Lenders, that shall be
required for the Lenders or any of them to take any action hereunder, or (f)
amend this Section 8.01; provided, further, that no amendment, waiver or consent
shall, unless in writing and signed by the Administrative Agent, in addition to
the Lenders required above to take such action, affect the rights or duties of
the Administrative Agent under this Agreement or any Note.
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SECTION 8.02. Notices, Etc. All notices and other communications
provided for hereunder shall be in writing (including telecopier, telegraphic,
telex or cable communication) and mailed, telecopied, telegraphed, telexed,
cabled or delivered, if to the Borrower, at its address at 0000 Xxxxxx Xxxxxx,
Xxxxxxxxxxxx, Xxxxxxxxxxxx 00000, Attention: Vice President-Finance and
Treasurer, S21-1, Telecopy: (000) 000-0000; if to any Bank, at its Domestic
Lending Office specified opposite its name on Schedule I hereto; if to any other
Lender, at its Domestic Lending Office specified in the Assignment and
Acceptance or Additional Lender Supplement pursuant to which it became a Lender;
and if to the Administrative Agent, at its address at One First National Plaza,
Mail Suite 0634, 1FPN-10, Xxxxxxx, Xxxxxxxx 00000, Attention: Xx. Xxx Xxxxxx,
Telecopy: (000) 000-0000 or, as to each party, at such other address as shall be
designated by such party in a written notice to the other parties. All such
notices and communications shall, when mailed, telecopied, telegraphed, telexed
or cabled, be effective when deposited in the mails, telecopied, delivered to
the telegraph company, confirmed by telex answerback or delivered to the cable
company, respectively, except that notices and communications to the
Administrative Agent pursuant to Article II or VII shall not be effective until
received by the Administrative Agent.
SECTION 8.03. No Waiver; Remedies. No failure on the part of any Lender
or the Administrative Agent to exercise, and no delay in exercising, any right
hereunder or under any Note shall operate as a waiver thereof; nor shall any
single or partial exercise of any such right preclude any other or further
exercise thereof or the exercise of any other right. The remedies herein
provided are cumulative and not exclusive of any remedies provided by law.
SECTION 8.04. Costs and Expenses; Indemnification. (a) The Borrower
agrees to pay on demand all costs and expenses incurred by the Administrative
Agent and the Lead Arranger in connection with the preparation, execution,
delivery, administration, syndication, modification and amendment of this
Agreement, the Notes and the other documents to be delivered hereunder,
including, without limitation, the reasonable fees, internal charges and
out-of-pocket expenses of counsel (including, without limitation, in-house
counsel) for such Agents with respect thereto and with respect to advising such
Agents as to their respective rights and responsibilities under this Agreement.
The Borrower further agrees to pay on demand all costs and expenses, if any
(including, without limitation, counsel fees and expenses of outside counsel and
of internal counsel), incurred by the any Agent or any Lender in connection with
the collection and enforcement (whether through negotiations, legal proceedings
or otherwise) of this Agreement, the Notes and the other documents to be
delivered hereunder, including, without limitation, reasonable counsel fees and
expenses in connection with the enforcement of rights under this Section
8.04(a).
(b) If any payment of principal of, or Conversion of any Eurodollar
Rate Advance is made other than on the last day of the Interest Period for such
Advance, as a result of a payment or Conversion pursuant to Section 2.09 or 2.12
or acceleration of the maturity of the Notes pursuant to Section 6.01 or for any
other reason, the Borrower shall, upon demand by any Lender (with a copy of such
demand to the Administrative Agent), pay to the Administrative Agent for the
account of such Lender any amounts required to compensate such Lender for any
additional losses, costs or expenses which it may reasonably incur as a result
of such payment or Conversion, including, without limitation, any loss, cost or
expense incurred by reason of the liquidation or reemployment of deposits or
other funds acquired by any Lender to fund or maintain such Advance.
(c) The Borrower hereby agrees to indemnify and hold each Lender, each
Agent and each of their respective Affiliates, officers, directors and employees
(each, an "Indemnified Person") harmless from and against any and all claims,
damages, losses, liabilities, costs or expenses (including reasonable attorney's
fees and expenses, whether or not such Indemnified Person is named as a party to
any proceeding or is otherwise subjected to judicial or legal process arising
from any such proceeding) that any of them may pay or incur arising out of or
relating to this Agreement, the Notes or the transactions contemplated thereby,
or the use by the Borrower or any of its subsidiaries of the proceeds of any
Advance, provided that the Borrower shall not be liable for any portion of such
claims, damages, losses, liabilities, costs or expenses resulting from such
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Indemnified Person's gross negligence or willful misconduct. The Borrower's
obligations under this Section 8.04(c) shall survive the repayment of all
amounts owing to the Lenders and the Administrative Agent under this Agreement
and the Notes and the termination of the Commitments. If and to the extent that
the obligations of the Borrower under this Section 8.04(c) are unenforceable for
any reason, the Borrower agrees to make the maximum contribution to the payment
and satisfaction thereof which is permissible under applicable law.
SECTION 8.05. Right of Set-off. Upon (i) the occurrence and during the
continuance of any Event of Default and (ii) the making of the request or the
granting of the consent specified by Section 6.01 to authorize the
Administrative Agent to declare the Notes due and payable pursuant to the
provisions of Section 6.01, each Lender 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 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 and
any Note held by such Lender, whether or not such Lender shall have made any
demand under this Agreement or such Note 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 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 8.05 are in addition to other rights
and remedies (including, without limitation, other rights of set-off) that such
Lender may have.
SECTION 8.06. Binding Effect. This Agreement shall become effective
when it shall have been executed by the Borrower and the Agents and when the
Administrative Agent shall have been notified by each Bank that such Bank has
executed it and thereafter shall be binding upon and inure to the benefit of the
Borrower, the Agents and each Lender and their respective successors and
assigns, except that the Borrower shall not have the right to assign its rights
hereunder or any interest herein without the prior written consent of the
Lenders.
SECTION 8.07. Assignments and Participations. (a) Each Lender may, with
the prior written consent of the Borrower and the Administrative Agent (neither
of which consents shall be unreasonably withheld or delayed), and if demanded by
the Borrower pursuant to subsection (g) hereof shall to the extent required by
such subsection (g), assign to one or more banks or other entities all or a
portion of its rights and obligations under this Agreement (including, without
limitation, all or a portion of its Commitment, the Advances owing to it and the
Note or Notes held by it); provided, however, that (i) each such assignment
shall be of a constant, and not a varying, percentage of all of the assigning
Lender's rights and obligations under this Agreement, (ii) the amount of the
Commitment of the assigning Lender being assigned pursuant to each such
assignment (determined as of the date of the Assignment and Acceptance with
respect to such assignment) shall in no event be less than $10,000,000 or, if
less, the entire amount of such Lender's Commitment, and shall be an integral
multiple of $1,000,000 or such Lender's entire Commitment, (iii) each such
assignment shall be to an Eligible Assignee, (iv) the parties to each such
assignment shall execute and deliver to the Administrative Agent, for its
acceptance and recording in the Register, an Assignment and Acceptance, together
with any Note or Notes subject to such assignment and a processing and
recordation fee of $3,500 (which shall be payable by one or more of the parties
to the Assignment and Acceptance, and not by the Borrower, and shall not be
payable if the assignee is a Bank, any Affiliate of any Bank or the Federal
Reserve Bank), and (v) the consent of the Borrower shall not be required after
the occurrence and during the continuance of any Event of Default. Upon such
execution, delivery, acceptance and recording, from and after the effective date
specified in each Assignment and Acceptance, (x) the assignee thereunder shall
be a party hereto and, to the extent that rights and obligations hereunder have
been assigned to it pursuant to such Assignment and Acceptance, have the rights
and obligations of a Lender hereunder and (y) the Lender assignor thereunder
shall, to the extent that rights and obligations hereunder have been assigned by
it pursuant to such Assignment and Acceptance, relinquish its rights and be
released from its obligations under this Agreement and, in the case of an
Assignment and Acceptance covering all or the remaining portion of an assigning
Lender's rights and obligations under this Agreement, such Lender shall cease to
-32-
be a party hereto (although an assigning Lender shall continue to be entitled to
indemnification pursuant to Section 8.04(c)). Notwithstanding anything contained
in this Section 8.07(a) to the contrary, (A) the consent of the Borrower and the
Administrative Agent shall not be required with respect to any assignment by any
Lender to an Affiliate of such Lender or to another Lender and (B) any Lender
may at any time, without the consent of the Borrower or the Administrative
Agent, and without any requirement to have an Assignment and Acceptance
executed, assign all or any part of its rights under this Agreement and its
Notes to a Federal Reserve Bank, provided that such assignment does not release
the transferor Lender from any of its obligations hereunder.
(b) By executing and delivering an Assignment and Acceptance, the
Lender assignor thereunder and the assignee thereunder confirm to and agree with
each other and the other parties hereto as follows: (i) other than as provided
in such Assignment and Acceptance, such assigning Lender makes no representation
or warranty and assumes no responsibility with respect to any statements,
warranties or representations made in or in connection with this Agreement or
the execution, legality, validity, enforceability, genuineness, sufficiency or
value of this Agreement or any other instrument or document furnished pursuant
hereto; (ii) such assigning Lender makes no representation or warranty and
assumes no responsibility with respect to the financial condition of the
Borrower or the performance or observance by the Borrower of any of its
obligations under this Agreement or any other instrument or document furnished
pursuant hereto; (iii) such assignee confirms that it has received a copy of
this Agreement, together with copies of the financial statements referred to in
Section 4.01(e) and such other documents and information as it has deemed
appropriate to make its own credit analysis and decision to enter into such
Assignment and Acceptance; (iv) such assignee will, independently and without
reliance upon the Administrative Agent, such assigning Lender 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 this Agreement; (v) such assignee confirms that it is an Eligible
Assignee; (vi) such assignee appoints and authorizes the Administrative Agent to
take such action as agent on its behalf and to exercise such powers under this
Agreement as are delegated to the Administrative Agent by the terms hereof,
together with such powers as are reasonably incidental thereto; and (vii) such
assignee agrees that it will perform in accordance with their terms all of the
obligations which by the terms of this Agreement are required to be performed by
it as a Lender.
(c) The Administrative Agent shall maintain at its address referred to
in Section 8.02 a copy of each Assignment and Acceptance and each Additional
Lender Supplement delivered to and 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 Advances 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 Administrative 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.
(d) Upon its receipt of an Assignment and Acceptance executed by an
assigning Lender and an assignee representing that it is an Eligible Assignee,
together with any Note or Notes subject to such assignment, the Administrative
Agent shall, if such Assignment and Acceptance has been completed and is in
substantially the form of Exhibit C hereto, (i) accept such Assignment and
Acceptance, (ii) record the information contained therein in the Register and
(iii) give prompt notice thereof to the Borrower. Within five Business Days
after its receipt of such notice, the Borrower, at its own expense, shall
execute and deliver to the Administrative Agent in exchange for the surrendered
Note or Notes a new Note to the order of such Eligible Assignee in an amount
equal to the Commitment assumed by it pursuant to such Assignment and Acceptance
and, if the assigning Lender has retained a Commitment hereunder, a new Note to
the order of the assigning Lender in an amount equal to the Commitment retained
by it hereunder. Such new Note or Notes shall be in an aggregate principal
amount equal to the aggregate principal amount of such surrendered Note or
Notes, shall be dated the effective date of such Assignment and Acceptance and
shall otherwise be in substantially the form of Exhibit A hereto.
-33-
(e) Each Lender may sell participations to one or more banks or other
entities (each, a "Participant") in or to all or a portion of its rights and/or
obligations under this Agreement (including, without limitation, all or a
portion of its Commitment, the Advances owing to it and the Note or Notes held
by it); provided, however, that (i) such Lender's obligations under this
Agreement (including, without limitation, its Commitment to the Borrower
hereunder) shall remain unchanged, (ii) such Lender shall remain solely
responsible to the other parties hereto for the performance of such obligations,
(iii) such Lender shall remain the holder of any such Note for all purposes of
this Agreement, (iv) the Borrower, the Administrative Agent and the other
Lenders shall continue to deal solely and directly with such Lender in
connection with such Lender's rights and obligations under this Agreement and
(v) such Lender shall retain the sole right to approve, without the consent of
any Participant, any amendment, modification or waiver of any provision of this
Agreement or the Note or Notes held by such Lender, other than any such
amendment, modification or waiver with respect to any Advance or Commitment in
which such Participant has an interest that forgives principal, interest or fees
or reduces the interest rate or fees payable with respect to any such Advance or
Commitment, postpones any date fixed for any regularly scheduled payment of
principal of, or interest or fees on, any such Advance or Commitment, releases
any guarantor of any such Advance or releases any substantial portion of
collateral, if any, securing any such Advance.
(f) Any Lender may, in connection with any assignment or participation
or proposed assignment or participation pursuant to this Section 8.07, disclose
to the assignee or participant or proposed assignee or participant, any
information relating to the Borrower furnished to such Lender by or on behalf of
the Borrower; provided that, prior to any such disclosure, the assignee or
participant or proposed assignee or participant shall agree to preserve the
confidentiality of any confidential information relating to the Borrower
received by it from such Lender (subject to customary exceptions regarding
regulatory requirements, compliance with legal process and other requirements of
law).
(g) If (i) any Lender shall make demand for payment under Section
2.11(a), 2.11(b) or 2.14, or (ii) shall deliver any notice to the Administrative
Agent pursuant to Section 2.12 resulting in the suspension of certain
obligations of the Lenders with respect to Eurodollar Rate Advances or (iii)
shall fail to consent to, or shall revoke its consent to, the extension of any
Termination Date pursuant to Section 2.16 or (iv) shall fail to consent to, or
shall revoke its consent to, any extension of the "Termination Date" (as defined
in the Revolving Credit Agreement) requested by the Borrower pursuant to Section
2.16 of the Revolving Credit Agreement as originally constituted (or any
successor provision of similar import), then (in the case of clause (i)) within
60 days after such demand (if, but only if, such payment demanded under Section
2.11(a), 2.11(b) or 2.14 has been made by the Borrower), or (in the case of
clause (ii)) within 60 days after such notice (if such suspension is still in
effect), or (in the case of clauses (iii) and (iv)) no later than 10 days prior
to the then effective Termination Date, as the case may be, the Borrower may
demand that such Lender assign in accordance with this Section 8.07 to one or
more Eligible Assignees designated by the Borrower and reasonably acceptable to
the Administrative Agent all (but not less than all) of such Lender's Commitment
and the Advances owing to it within the next succeeding 30 days (in the case of
clause (i) or clause (ii)), or within the next succeeding 5 days (in the case of
clauses (iii) and (iv)) . If any such Eligible Assignee designated by the
Borrower shall fail to consummate such assignment on terms acceptable to such
Lender, or if the Borrower shall fail to designate any such Eligible Assignee
for all of such Lender's Commitment or Advances, then such Lender may (but shall
not be required to) assign such Commitment and Advances to any other Eligible
Assignee in accordance with this Section 8.07 during such period.
(h) Notwithstanding anything to the contrary contained herein, any
Lender (a "Granting Bank") may grant to a special purpose funding vehicle (an
"SPC"), identified as such in writing from time to time by the Granting Bank to
the Administrative Agent and the Borrower, the option to provide to the Borrower
all or any part of any Advance that such Granting Bank would otherwise be
-34-
obligated to make to the Borrower pursuant to this Agreement; provided that (i)
nothing herein shall constitute a commitment by any SPC to make any Advance,
(ii) if an SPC elects not to exercise such option or otherwise fails to provide
all or any part of such Advance, the Granting Bank shall be obligated to make
such Advance pursuant to the terms hereof. The making of an Advance by an SPC
hereunder shall utilize the Commitment of the Granting Bank to the same extent,
and as if, such Advance were made by such Granting Bank. Each party hereto
hereby agrees that no SPC shall be liable for any indemnity or similar payment
obligation under this Agreement (all liability for which shall remain with the
Granting Bank). In furtherance of the foregoing, each party hereto hereby agrees
(which agreement shall survive the termination of this Agreement) that, prior to
the date that is one year and one day after the payment in full of all
outstanding commercial paper or other senior indebtedness of any SPC, it will
not institute against, or join any other person in instituting against, such SPC
any bankruptcy, reorganization, arrangement, insolvency or liquidation
proceedings under the laws of the United States or any State thereof. In
addition, notwithstanding anything to the contrary contained in this Section
8.07(h), any SPC may (i) with notice to, but without the prior written consent
of, the Borrower and the Administrative Agent and without paying any processing
fee therefor, assign all or a portion of its interests in any Advances to the
Granting Bank or to any financial institutions (consented to by the Borrower and
Administrative Agent) providing liquidity and/or credit support to or for the
account of such SPC to support the funding or maintenance of Advances and (ii)
disclose on a confidential basis any non-public information relating to its
Advances to any rating agency, commercial paper dealer or provider of any
surety, guarantee or credit or liquidity enhancement to such SPC. This Section
may not be amended without the written consent of the Granting Bank.
SECTION 8.08. Governing Law. THIS AGREEMENT AND THE NOTES SHALL BE
GOVERNED BY, AND CONSTRUED IN ACCORDANCE WITH, THE LAWS OF THE COMMONWEALTH OF
PENNSYLVANIA.
SECTION 8.09. Consent to Jurisdiction. THE BORROWER HEREBY IRREVOCABLY
SUBMITS TO THE NON-EXCLUSIVE JURISDICTION OF THE COURTS OF THE COMMONWEALTH OF
PENNSYLVANIA AND ANY UNITED STATES DISTRICT COURT SITTING IN THE COMMONWEALTH OF
PENNSYLVANIA IN ANY ACTION OR PROCEEDING ARISING OUT OF OR RELATING TO THIS
AGREEMENT OR THE NOTES AND THE BORROWER HEREBY IRREVOCABLY AGREES THAT ALL
CLAIMS IN RESPECT OF SUCH ACTION OR PROCEEDING MAY BE HEARD AND DETERMINED IN
ANY SUCH COURT AND IRREVOCABLY WAIVES ANY OBJECTION IT MAY NOW OR HEREAFTER HAVE
AS TO THE VENUE OF ANY SUCH SUIT, ACTION OR PROCEEDING BROUGHT IN SUCH A COURT
OR THAT SUCH COURT IS AN INCONVENIENT FORUM. NOTHING HEREIN SHALL LIMIT THE
RIGHT OF THE ADMINISTRATIVE AGENT OR ANY LENDER TO BRING PROCEEDINGS AGAINST THE
BORROWER IN THE COURTS OF ANY OTHER JURISDICTION.
SECTION 8.10. Execution in Counterparts; Integration. This Agreement
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. This Agreement constitutes the entire agreement and understanding
among the parties hereto and supersedes all prior and contemporaneous agreements
and understandings, oral or written, relating to the subject matter hereof.
[Remainder of the page intentionally left blank]
-35-
IN WITNESS WHEREOF, the parties hereto have caused this Agreement to be
executed by their respective officers thereunto duly authorized, as of the date
first above written.
[SEAL] PECO ENERGY COMPANY
PECO ENERGY COMPANY
By /s/ X. X. Xxxxxxxx
--------------------------------------------
Name: X. X. Xxxxxxxx
Title: Vice President - Finance and Treasurer
/s/ Xxxx X. Xxxxxx
-------------------
Xxxx X. Xxxxxx
Assistant Secretary
THE FIRST NATIONAL BANK OF CHICAGO,
as Administrative Agent
By /s/ Xxxxxxx X. Xxxxx
------------------------------------
Name: Xxxxxxx X. Xxxxx
Title: Authorized Agent
CITIBANK, N.A.,
as Documentation Agent
By: /s/ Xxxxxx X. Xxxxxxx, Xx.
----------------------------------------
Title: Managing Director
BANC ONE CAPITAL MARKETS, INC.,
as Lead Arranger
By /s/ Xxxxxxx X. Xxxxx
------------------------------------
Name: Xxxxxxx X. Xxxxx
Title: Vice President/Senior Banker
This is a signature page to the 364-Day Credit Agreement, dated as of September
15, 1999, among PECO Energy Company, as Borrower, the banks named therein, as
Banks, The First National Bank of Chicago, as Administrative Agent, Citibank,
N.A., as Documentation Agent, and Banc One Capital Markets, Inc., as Lead
Arranger.
-36-
THE BANKS
Commitment
$60,000,000
THE FIRST NATIONAL BANK OF CHICAGO, as
Administrative Agent and as Bank
By /s/ Xxxxxxx X. Xxxxx
-----------------------------------
Name: Xxxxxxx X. Xxxxx
Title: Authorized Agent
This is a signature page to the 364-Day Credit Agreement, dated as of September
15, 1999, among PECO Energy Company, as Borrower, the banks named therein, as
Banks, The First National Bank of Chicago, as Administrative Agent, Citibank,
N.A., as Documentation Agent, and Banc One Capital Markets, Inc., as Lead
Arranger.
-37-
Commitment
$60,000,000
CITIBANK, N.A., as Documentation Agent
and as Bank
By: /s/ Xxxxxx X. Xxxxxxx, Xx.
--------------------------------
Name: Xxxxxx X. Xxxxxxx, Xx.
Title: Managing Director
This is a signature page to the 364-Day Credit Agreement, dated as of September
15, 1999, among PECO Energy Company, as Borrower, the banks named therein, as
Banks, The First National Bank of Chicago, as Administrative Agent, Citibank,
N.A., as Documentation Agent, and Banc One Capital Markets, Inc., as Lead
Arranger.
-38-
Commitment
$50,000,000
BANK OF AMERICA, N.A.
as Bank
By /s/ Xxxxxxxx Xxxxxxxx, Xx.
-------------------------------
Name: Xxxxxxxx Xxxxxxxx, Xx.
Title: Managing Director
This is a signature page to the 364-Day Credit Agreement, dated as of September
15, 1999, among PECO Energy Company, as Borrower, the banks named therein, as
Banks, The First National Bank of Chicago, as Administrative Agent, Citibank,
N.A., as Documentation Agent, and Banc One Capital Markets, Inc., as Lead
Arranger.
-39-
Commitment
$50,000,000
THE BANK OF NEW YORK, as Bank
By /s/ Xxxx X. Xxxx
-------------------------------
Name: Xxxx X. Xxxx
Title: Vice President
This is a signature page to the 364-Day Credit Agreement, dated as of September
15, 1999, among PECO Energy Company, as Borrower, the banks named therein, as
Banks, The First National Bank of Chicago, as Administrative Agent, Citibank,
N.A., as Documentation Agent, and Banc One Capital Markets, Inc., as Lead
Arranger.
-40-
Commitment
$50,000,000
CREDIT SUISSE FIRST BOSTON, as Bank
By /s/ Xxxxxxx X. Xxxxx
------------------------------
Name: Xxxxxxx X. Xxxxx
Title: Vice President
This is a signature page to the 364-Day Credit Agreement, dated as of September
15, 1999, among PECO Energy Company, as Borrower, the banks named therein, as
Banks, The First National Bank of Chicago, as Administrative Agent, Citibank,
N.A., as Documentation Agent, and Banc One Capital Markets, Inc., as Lead
Arranger.
-41-
Commitment
$50,000,000
FIRST UNION NATIONAL BANK, as Bank
By /s/ Xxx X. Xxxxxx
-------------------------------
Name: Xxx X. Xxxxxx
Title: Vice President
This is a signature page to the 364-Day Credit Agreement, dated as of September
15, 1999, among PECO Energy Company, as Borrower, the banks named therein, as
Banks, The First National Bank of Chicago, as Administrative Agent, Citibank,
N.A., as Documentation Agent, and Banc One Capital Markets, Inc., as Lead
Arranger.
-42-
Commitment
$50,000,000
MELLON BANK, N.A., as Bank
By /s/ Xxxx X. Xxxxxx
----------------------------
Name: Xxxx X. Xxxxxx
Title: Vice President
This is a signature page to the 364-Day Credit Agreement, dated as of September
15, 1999, among PECO Energy Company, as Borrower, the banks named therein, as
Banks, The First National Bank of Chicago, as Administrative Agent, Citibank,
N.A., as Documentation Agent, and Banc One Capital Markets, Inc., as Lead
Arranger.
-43-
Commitment
$25,000,000
UNION BANK OF CALIFORNIA, N.A.,
as Bank
By /s/ Xxxxxx X. Xxxx
------------------------------
Name: Xxxxxx X. Xxxx
Title: Vice President
This is a signature page to the 364-Day Credit Agreement, dated as of September
15, 1999, among PECO Energy Company, as Borrower, the banks named therein, as
Banks, The First National Bank of Chicago, as Administrative Agent, Citibank,
N.A., as Documentation Agent, and Banc One Capital Markets, Inc., as Lead
Arranger.
-44-
Commitment
$25,000,000
TORONTO DOMINION (TEXAS), INC.,
as Bank
By /s/ Xxxxx Xxxxxx
---------------------------------
Name: Xxxxx Xxxxxx
Title: Vice President
This is a signature page to the 364-Day Credit Agreement, dated as of September
15, 1999, among PECO Energy Company, as Borrower, the banks named therein, as
Banks, The First National Bank of Chicago, as Administrative Agent, Citibank,
N.A., as Documentation Agent, and Banc One Capital Markets, Inc., as Lead
Arranger.
-45-
Commitment
$17,500,000
COMMERCE BANK, N.A., as Bank
By /s/ Xxxx X. Xxxxx
-------------------------------
Name: Xxxx X. Xxxxx
Title: Vice President
This is a signature page to the 364-Day Credit Agreement, dated as of September
15, 1999, among PECO Energy Company, as Borrower, the banks named therein, as
Banks, The First National Bank of Chicago, as Administrative Agent, Citibank,
N.A., as Documentation Agent, and Banc One Capital Markets, Inc., as Lead
Arranger.
-46-
Commitment
$12,500,000
BARCLAYS BANK PLC, as Bank
By /s/ Sydney X. Xxxxxx
---------------------------------
Name: Sydney X. Xxxxxx
Title: Director
This is a signature page to the 364-Day Credit Agreement, dated as of September
15, 1999, among PECO Energy Company, as Borrower, the banks named therein, as
Banks, The First National Bank of Chicago, as Administrative Agent, Citibank,
N.A., as Documentation Agent, and Banc One Capital Markets, Inc., as Lead
Arranger.
-47-
SCHEDULE I
364-Day Credit Agreement, dated as of September 15, 1999, among PECO Energy
Company, as Borrower, the banks named therein, as Banks, The First National Bank
of Chicago, as Administrative Agent, Citibank, N.A., as Documentation Agent, and
Banc One Capital Markets, Inc., as Lead Arranger.
Domestic Eurodollar
Name of Bank Lending Office Lending Office
------------ -------------- --------------
The First National Bank of One First National Plaza Same
Chicago Mail Suite 0634, 1FNP-10
Xxxxxxx, XX 00000
Attn: Xxxxxxxxx Xxxxxx
Phone: (000) 000-0000
Fax: (000) 000-0000
The Bank of New York One Wall Street, 19th Floor Same
Energy Industries Division
Xxx Xxxx, XX 00000
Attn: Xxxxxxx X. Xxxxx
Phone: (000) 000-0000
Fax: (000) 000-0000
Citibank, N.A. 000 Xxxx Xxxxxx Same
0xx Xxxxx, Xxxx 00
Xxx Xxxx, XX 00000
Attn: Xxxxx Xxxxx
Phone: (000) 000-0000
Fax: (000) 000-0000
Credit Suisse First Boston 00 Xxxxxxx Xxxxxx Same
00xx Xxxxx
Xxx Xxxx, XX 00000-0000
Attn: Xxxxxx Xxxxxxxx
Phone: (000) 000-0000
Fax: (000) 000-0000/0576
First Union National Bank 000 Xxxxx Xxxxxxx Xxxxxx Same
00xx Xxxxx
Xxxxxxxxx, XX 00000-0000
Attn: Xxxxx Xxxxxx
Phone: (000) 000-0000
Fax: (000) 000-0000
Mellon Bank, N.A. Three Mellon Bank Center Room Same
2303 (Loan Administration)
Xxxxxxxxxx, XX 00000-0000
Attn: Xxxxx Xxxx
Phone: (000) 000-0000
Fax: (000) 000-0000, 2028
Union Bank of Energy Capital Services Same
California, N.A. 000 X. Xxxxxxxx Xxxxxx
00xx Xxxxx
Xxx Xxxxxxx, XX 00000
Attn: Xxxxxxx X. Xxxxxx
Phone: (000) 000-0000
Fax: (000) 000-0000
Commerce Bank, N.A. 0000 Xxxxxx Xxxxxx Same
Xxx Xxxxxxxx Xxxxxx
0xx Xxxxx
Xxxxxxxxxxxx, XX 00000
Attn: Xxx Xxxxx
AIM #000-00-00
Phone: (000) 000-0000 Ext. 8570
Fax: (000) 000-0000
Toronto Dominion (Texas) Inc. 000 Xxxxxx, Xxxxx 0000 Xxxx
Xxxxxxx, XX 00000
Attn: Xxxxxxx Xxxxxx
Phone: (000) 000-0000
Fax: (000) 000-0000
Barclays Bank PLC 000 Xxxxxxxx Xxxx
Xxx Xxxx, XX 00000
Attn: Xxxxxx X. Xxxxxxxx
Phone: (000) 000-0000
Fax: (000) 000-0000
Bank of America, N.A. 0000 Xxxxxxxxx Xxxxx Same
0xx Xxxxx
Xxxxxxxx, XX 00000
Attn: Xxxxx Xxxxx
Phone: (000) 000-0000
Fax: (000) 000-0000
-2-
EXHIBIT A
FORM OF NOTE
$____________________ Dated: [ ], 1999
FOR VALUE RECEIVED, the undersigned, PECO Energy Company, a
Pennsylvania corporation (the "Borrower"), HEREBY PROMISES TO PAY to the order
of (the "Lender") for the account of its Applicable Lending Office (such term
and other capitalized terms herein being used as defined in the Credit Agreement
referred to below) on [insert then effective Termination Date] the principal sum
of U.S.$[amount of the Lender's Commitment in figures] or, if less, the
aggregate principal amount of the Advances made by the Lender to the Borrower
pursuant to the Credit Agreement outstanding on [insert then effective
Termination Date].
The Borrower promises to pay interest on the unpaid principal amount of
each Advance from the date of such Advance until such principal amount is paid
in full, at such interest rates, and payable at such times, as are specified in
the Credit Agreement.
Both principal and interest are payable in lawful money of the United
States of America to The First National Bank of Chicago, as Administrative
Agent, at Xxx Xxxxx Xxxxxxxx Xxxxx, Xxxxxxx, Xxxxxxxx 00000, in same day funds.
Each Advance made by the Lender to the Borrower pursuant to the Credit
Agreement, and all payments made on account of principal thereof, shall be
recorded by the Lender and, prior to any transfer hereof, endorsed on the grid
attached hereto which is part of this Promissory Note.
This Promissory Note is one of the Notes referred to in, and is
entitled to the benefits of, the 364-Day Credit Agreement, dated as of September
15, 1999 among PECO Energy Company, as Borrower, the banks named therein, as
Banks, The First National Bank of Chicago, as Administrative Agent, Citibank,
N.A., as Documentation Agent, and Banc One Capital Markets, Inc., as Lead
Arranger (as amended, modified or supplemented from time to time, the "Credit
Agreement"). The Credit Agreement, among other things, (i) provides for the
making of Advances by the Lender to the Borrower from time to time in an
aggregate amount not to exceed at any time outstanding the U.S. dollar amount
first above mentioned, the indebtedness of the Borrower resulting from each such
Advance being evidenced by this Promissory Note, and (ii) contains provisions
for acceleration of the maturity hereof upon the happening of certain stated
events and also for prepayments on account of principal hereof prior to the
maturity hereof upon the terms and conditions therein specified.
The Borrower hereby waives presentment, demand, protest and notice of
any kind. No failure to exercise, and no delay in exercising, any rights
hereunder on the part of the holder hereof shall operate as a waiver of such
rights.
THIS PROMISSORY NOTE SHALL BE GOVERNED BY, AND CONSTRUED IN ACCORDANCE
WITH, THE LAWS OF THE COMMONWEALTH OF PENNSYLVANIA.
PECO ENERGY COMPANY
By_______________________________
Name:
Title:
-2-
ADVANCES, MATURITIES, AND PAYMENTS OF PRINCIPAL
---------------------------------------------------------------------------------------------------------------
Amount of
Maturity Principal Unpaid
Amount of of Paid or Principal Notation
Date Advance Advance Prepaid Balance Made By
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EXHIBIT B
NOTICE OF A BORROWING
The First National Bank of Chicago, as Administrative Agent for the Lenders
parties to the Credit Agreement referred to below
Xxx Xxxxx Xxxxxxxx Xxxxx
Xxxxxxx, Xxxxxxxx 00000
[Date]
Attention: Utilities Department
North American Finance Group
Ladies and Gentlemen:
The undersigned, PECO Energy Company, refers to the 364-Day Credit
Agreement, dated as of September 15, 1999, among PECO Energy Company, as
Borrower, the banks named therein, as Banks, The First National Bank of Chicago,
as Administrative Agent, Citibank, N.A., as Documentation Agent, and Banc One
Capital Markets, Inc., as Lead Arranger (as amended, modified or supplemented
from time to time, the "Credit Agreement"), and hereby gives you notice,
irrevocably, pursuant to Section 2.02 of the Credit Agreement that the
undersigned hereby requests a Borrowing under the Credit Agreement, and in that
connection sets forth below the information relating to such Borrowing (the
"Proposed Borrowing") as required by Section 2.02(a) of the Credit Agreement:
(i) The Business Day of the Proposed Borrowing is _____, 19/20__.
(ii) The Type of Advances to be made in connection with the
Proposed Borrowing is [Base Rate Advances] [Eurodollar Rate Advances].
(iii) The aggregate amount of the Proposed Borrowing is $_______.
(iv) The Interest Period for each Advance made as part of the
Proposed Borrowing is [____days] [___ month[s]].
The undersigned hereby certifies that the following statements are true
on the date hereof, and will be true on the date of the Proposed Borrowing:
(A) the representations and warranties contained in Section 4.01
are correct, before and after giving effect to the Proposed Borrowing
and to the application of the proceeds therefrom, as though made on and
as of such date; and
(B) no event has occurred and is continuing, or would result from
such Proposed Borrowing or from the application of the proceeds
therefrom, that
constitutes an Event of Default or would constitute an Event of Default
but for the requirement that notice be given or time elapse or both.
Very truly yours,
PECO ENERGY COMPANY
By__________________________________________
Name:
Title:
-2-
EXHIBIT C
ASSIGNMENT AND ACCEPTANCE
Dated _________, 19/20__
Reference is made to the 364-Day Credit Agreement, dated as of
September 15, 1999 among PECO Energy Company, as Borrower, the banks named
therein, as Banks, The First National Bank of Chicago, as Administrative Agent,
Citibank, N.A., as Documentation Agent, and Banc One Capital Markets, Inc., as
Lead Arranger (as amended, modified or supplemented from time to time, the
"Credit Agreement"). Terms defined in the Credit Agreement are used herein with
the same meaning.
_____________ (the "Assignor") and _____________ (the "Assignee") agree
as follows:
1. The Assignor hereby sells and assigns to the Assignee, and the
Assignee hereby purchases and assumes from the Assignor, that interest in and to
all of the Assignor's rights and obligations under the Credit Agreement as of
the date hereof which represents the percentage interest specified on Schedule 1
of all outstanding rights and obligations under the Credit Agreement, including,
without limitation, such interest in the Assignor's Commitment, the Advances
owing to the Assignor, and the Note[s] held by the Assignor. After giving effect
to such sale and assignment, the Assignee's Commitment and the amount of the
Advances owing to the Assignee will be as set forth in Section 2 of 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; (iii) makes no representation or warranty and assumes no
responsibility with respect to the financial condition of the Borrower or the
performance or observance by the Borrower of any of its obligations under the
Credit Agreement or any other instrument or document furnished pursuant thereto;
and (iv) attaches the Note[s] referred to in paragraph 1 above and requests that
the Administrative Agent exchange such Note[s] for a new Note payable to the
order of the Assignee in an amount equal to the Commitment assumed by the
Assignee pursuant hereto or new Notes payable to the order of the Assignee in an
amount equal to the Commitment assumed by the Assignee pursuant hereto and the
Assignor in an amount equal to the Commitment retained by the Assignor under the
Credit Agreement, respectively as specified on Schedule 1 hereto.
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 4.01 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 under the Credit Agreement as are
delegated to the Administrative Agent by the terms thereof, together with such
powers as are reasonably incidental thereto; (v) agrees that it will perform in
accordance with their terms all of the obligations which by the terms of the
Credit Agreement are required to be performed by it as a Lender; (vi) none of
the consideration used to make the purchase being made by the Assignee hereunder
are "plan assets" as defined under ERISA and the rights and interests of the
Assignee in and under the Credit Agreement will not be "plan assets" under ERISA
[and] (vii) specifies as its, Domestic Lending Office (and address for notices)
and Eurodollar Lending Office the offices set forth beneath its name on the
signature pages hereof [and (viii) attaches the forms prescribed by the Internal
Revenue Service of the United States certifying that it is exempt from United
States withholding taxes with respect to all payments to be made to the Assignee
under the Credit Agreement and the Notes].(1)
4. Following the execution of this Assignment and Acceptance by the
Assignor and the Assignee, it will be delivered to the Administrative Agent for
acceptance and recording by the Administrative Agent. The effective date of this
Assignment and Acceptance shall be the date of acceptance thereof by the
Administrative Agent, unless otherwise specified on Schedule 1 hereto (the
"Effective Date").
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 and the Notes 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
and the Notes 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 COMMONWEALTH OF PENNSYLVANIA.
--------------
(1) If the Assignee is organized under the laws of a jurisdiction outside the
United States.
-2-
IN WITNESS WHEREOF, the parties hereto have caused this Assignment and
Acceptance to be executed by their respective officers thereunto duly
authorized, as of the date first above written, such execution being made on
Schedule 1 hereto.
[NAME OF ASSIGNOR]
By________________________________
Name:
Title:
[NAME OF ASSIGNEE]
By________________________________
Name:
Title:
Domestic Lending Office (and
address for notices):
[Address]
Eurodollar Lending Office:
[Address]
Consented to this ___ day
of _________________, 19/20
PECO ENERGY COMPANY
By_________________________
Name:
Title:
Consented to and Accepted this __ day
of ____________, 19/20
[NAME OF ADMINISTRATIVE AGENT]
By_________________________
Name:
Title:
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Schedule 1
to
Assignment and Acceptance
Dated _______, 19/20__
Section 1.
Percentage Interest: __%
Section 2.
Assignee's Commitment: $___________
Aggregate Outstanding Principal
Amount of Advances
owing to the Assignee: $___________
A Note payable to the
order of the Assignee
Dated _______, 19/20__
Principal amount: $___________
A Note payable to the
order of the Assignor
Dated _______, 19/20__
Principal amount: $___________
Section 3.
Effective Date(2): _______, 19/20__
---------------
(2) This date should be no earlier than the date of acceptance by the
Administrative Agent.
EXHIBIT D
FORM OF OPINION OF XXXXXXX XXXXX
XXXXXXX & XXXXXXXXX
_______, 19/20__
To each of the Banks, the Administrative Agent, and the Lead
Arranger party to the 364-Day Credit Agreement, dated as of
September 15, 1999, among PECO Energy Company, as Borrower, the
banks named therein, as Banks, The First National Bank of
Chicago, as Administrative Agent, Citibank, N.A., as
Documentation Agent, and Banc One Capital Markets, Inc., as
Lead Arranger
Re: PECO Energy Company
Ladies and Gentlemen:
This opinion is furnished to you pursuant to Section 3.01(a)(vi) of the
364-Day Credit Agreement, dated as of September 15, 1999, among PECO Energy
Company, as Borrower, the banks named therein, as Banks, The First National Bank
of Chicago, as Administrative Agent, Citibank, N.A., as Documentation Agent, and
Banc One Capital Markets Inc, as Lead Arranger (as amended, modified or
supplemented from time to time, the "Credit Agreement"). Unless otherwise
specified, terms defined in the Credit Agreement are used herein as therein
defined.
We have acted as special counsel for the Borrower in connection with
the preparation, execution and delivery of the Credit Agreement. In that
capacity we have examined the following:
(i) The Credit Agreement and the Notes;
(ii) The documents furnished by the Borrower pursuant to Section
3.01 of the Credit Agreement;
(iii) The Amended and Restated Articles of Incorporation of the
Borrower and all amendments thereto (the "Charter");
(iv) The by-laws of the Borrower and all amendments thereto (the
"By-laws"); and
(v) A certificate of the Secretary of State of the Commonwealth
of Pennsylvania, dated , 1999, attesting to the continued subsistence
of the Borrower in Pennsylvania.
We have also examined the originals, or copies certified to our
satisfaction, of such other corporate records of the Borrower, certificates of
public officials and of officers of the Borrower, and agreements, instruments
and documents, as we have deemed necessary as a basis for the opinions
hereinafter expressed. We have assumed the legal capacity and competence of
natural persons, the genuineness of all signatures, the authenticity of all
documents submitted to us as originals and the conformity to original documents
of documents submitted to us as certified, conformed or photostatic copies. We
have assumed that the Agents and the Banks have duly executed and delivered,
with all necessary power and authority (corporate and otherwise), the Credit
Agreement.
When an opinion or confirmation is given to our knowledge or with
reference to matters of which we are aware or which are known to us, or with
another similar qualification, the relevant knowledge or awareness is limited to
the actual knowledge or awareness of the lawyer who is the current primary
contact for the Borrower and the individual lawyers in this firm who have
participated in the specific transaction to which this opinion relates and
without any special or additional investigation undertaken for the purposes of
this opinion, except as otherwise noted herein. Based upon the foregoing and
subject to the exceptions, limitations and qualifications set forth herein, we
are of the following opinion:
1. The Borrower is a corporation duly incorporated and validly
subsisting under the laws of the Commonwealth of Pennsylvania.
2. The execution, delivery and performance by the Borrower of the
Credit Agreement and the Notes are within the Borrower's corporate
powers, have been duly authorized by all necessary corporate action, do
not contravene (i) the Charter or the By-laws or (ii) any law of the
United States or the Commonwealth of Pennsylvania (including, without
limitation, any order, rule or regulation of the PPUC or (iii) to the
best of our knowledge, any agreement or instrument to which the
Borrower is a party or by which it is bound, and do not result in or
require the creation of any lien, security interest or other charge or
encumbrance upon or with respect to any of its properties.
3. No authorization, approval or other action by, and no notice
to or filing with, any governmental authority or regulatory body of the
United States or the Commonwealth of Pennsylvania is required for the
due execution, delivery and performance by the Borrower of the Credit
Agreement or the Notes except for the filing of the FERC Application
with, and the final approval of, and the FERC Authorization issued by,
FERC, which filing has been duly made and which final approval and FERC
Authorization have been duly obtained; such FERC Authorization is in
full force and effect and is final; and the action of FERC approving
the FERC Application is no longer subject to appeal.
4. The Credit Agreement and the Notes have been duly executed and
delivered by the Borrower, and the Credit Agreement and the Notes are
the legal, valid and binding obligations of the Borrower enforceable
against the Borrower in accordance with their respective terms.
5. The Borrower (i) is exempt from the provisions of the Public
Utility Holding Company Act of 1935, as amended, other than Section
9(a)(2) thereof, pursuant to Section 3(a)(2) thereof, and (ii) 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. We confirm to you that to our knowledge, after inquiry of each
lawyer who is the current primary contact for the Borrower or who has
devoted substantive attention to matters on behalf of the Borrower
during the preceding twelve months and who is still currently employed
by or a member of this firm, except as disclosed in the Borrower's
Annual Report on Form 10-K for the year ended December 31, 1998 and the
Borrower's Quarterly Report on Form 10-Q for the quarter ended June 30,
1999, no litigation or governmental proceeding is pending or threatened
in writing against the Borrower (i) with respect to the Credit
Agreement or the Notes, or (ii) which is likely to have a material
-2-
adverse effect upon the financial condition, business, properties or
prospects of the Borrower and its subsidiaries taken as a whole.
We draw to your attention the existence of the following two
Pennsylvania statutes in connection with the fact that the Advances bear
floating rates of interest:
(i) Section 911 of the Pennsylvania "Crime Code," 18 Pa. C.S.A.
ss.911, enacted by the Act of December 6, 1972, P.L. 1482. Section 911
of the Crime Code bears a close resemblance to certain of the
provisions of the Federal Racketeer Influenced and Corrupt
Organizations Act of 1970, 18 U.S.C. ss.ss.1961-1968, commonly known as
RICO, and is referred to hereinafter as the "Pennsylvania RICO Act."
The Pennsylvania RICO Act provides, among other things, that it is a
criminal offense, punishable as a felony, to "use or invest, directly
or indirectly ... in the acquisition of any interest in, or the
establishment or operation of, any enterprise" any income collected in
full or partial satisfaction of a loan made "at a rate of interest
exceeding 25% per annum... ."
(ii) The Act of December 29, 1982, P.L. 1671, 18 Pa.
C.S.A.ss.4806.1 et seq. (superseded volume) (the "Criminal Usury
Statute"). The Criminal Usury Statute provides, among other things,
that it is a criminal offense, punishable as a felony, to engage in,
"charging, taking or receiving any money ... on the loan ... of any
money ... at a rate exceeding thirty-six percent per annum... ."
The Criminal Usury Statute may have been repealed, but the manner in
which the repeal was enacted leaves the matter subject to uncertainty.
Both the Pennsylvania RICO Act and the Criminal Usury Statute appear to
be intended by the legislature to apply only to racketeering and loan sharking
type activities, and not to the type of commercial loan transaction evidenced by
the Loan Document. Nevertheless, in view of the plain language of the
Pennsylvania courts, we cannot say that the ultimate resolution of this issue is
free from doubt.
The foregoing opinions are subject to the following exceptions,
limitations and qualifications:
(a) Our opinion is subject to the effect of applicable
bankruptcy, insolvency, reorganization, moratorium, fraudulent
conveyance, fraudulent transfer or similar laws affecting creditors'
rights and remedies generally, 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); and limitations on
enforceability of rights to indemnification by federal or state
securities laws or regulations or by public policy.
(b) We express no opinion as to the application or requirements
of the Pennsylvania Securities Act or federal or state securities,
patent, trademark, copyright, antitrust and unfair competition, pension
or employee benefit, labor, environmental health and safety or tax laws
in respect of the transactions contemplated by or referred to in the
Credit Agreement.
(c) We express no opinion as to the validity or enforceability of
any provision of the Credit Agreement or the Notes which (i) permits
the Lenders to increase the rate of interest in the event of
delinquency or default if such increase would be deemed a penalty under
applicable law; (ii) purports to be a waiver by Borrower of any right
or benefit except to the extent permitted by applicable law; (iii)
-3-
purports to require that waivers must be in writing to the extent that
an oral agreement or implied agreement by trade practice or course of
conduct modifying provisions of the Credit Agreement or the Notes has
been made; or (iv) purports to exculpate any party from its own
negligent acts.
We express no opinion as to the law of any jurisdiction other than the
law of the Commonwealth of Pennsylvania and the federal law of the United
States.
The foregoing opinion is solely for your benefit in connection with the
consummation of the transaction described herein and may not be used or relied
upon by you or any other Person without our express written consent for any
other purpose other than (i) any Eligible Assignee that may become a Lender
under the Credit Agreement after the date hereof and (ii) Xxxx Xxxxx Xxxx &
XxXxxx LLP, which may rely upon this opinion in rendering their opinion
furnished pursuant to Article III of the Credit Agreement. The opinions given
herein are as of the date hereof, and we assume no obligation to update or
supplement this opinion to reflect facts or circumstances which may hereafter
come to our attention or any changes in laws which may hereafter occur.
Very truly yours,
XXXXXXX XXXXX
XXXXXXX & INGERSOLL
-4-
EXHIBIT E
FORM OF OPINION OF XXXX XXXXX XXXX & XxXXXX LLP
__________, 1999
To each of the Banks, the Administrative Agent, and the Lead
Arranger party to the 364-Day Credit Agreement, dated as of
September 15, 1999 among PECO Energy Company, as Borrower, the
banks named therein, as Banks, The First National Bank of
Chicago, as Administrative Agent, Citibank, N.A., as
Documentation Agent, and Banc One Capital Markets, Inc., as
Lead Arranger
Re: PECO Energy Company
Ladies and Gentlemen:
We have acted as counsel to The First National Bank of Chicago,
individually and as Administrative Agent, in connection with the preparation,
execution and delivery of the 364-Day Credit Agreement, dated as of September
15, 1999, among PECO Energy Company, as Borrower, the banks named therein, as
Banks, The First National Bank of Chicago, as Administrative Agent, Citibank,
N.A., as Documentation Agent, and Banc One Capital Markets, Inc., as Lead
Arranger (as amended, modified or supplemented from time to time, the "Credit
Agreement"). We are delivering this opinion pursuant to Section 3.01(a)(vii) of
the Credit Agreement. Unless otherwise defined herein, terms defined in the
Credit Agreement are used herein as therein defined.
In that connection, we have examined (i) counterparts of the Credit
Agreement, executed by the Borrower, the Banks, the Administrative Agent and the
Lead Arranger, (ii) the Notes, executed by the Borrower and (iii) the other
documents listed on Exhibit A hereto, including the opinion of Xxxxxxx Xxxxx
Xxxxxxx & Ingersoll, counsel to the Borrower (the "Opinion"), furnished to the
Administrative Agent pursuant to Section 3.01(a) of the Credit Agreement.
In our examination of the documents referred to above, we have assumed
the authenticity of all such documents submitted to us as originals, the
genuineness of all signatures, the due authority of the parties executing such
documents and the conformity to the originals of all such documents submitted to
us as copies. We have also assumed that the Banks, the Administrative Agent and
the Lead Arranger have duly executed and delivered, with all necessary power and
authority (corporate and otherwise), the Credit Agreement. As to matters of
fact, we have relied solely upon the documents we have examined.
Based upon the foregoing, we are of the opinion that, while we have not
independently considered the matters covered by the Opinion to the extent
necessary to enable us to express the conclusions stated therein, each of the
Opinion and the other documents listed in Exhibit A hereto are substantially
responsive to the corresponding requirements set forth in Section 3.01 of the
Credit Agreement pursuant to which the same have been delivered.
Please note that Xxxxxxx X. Xxxxxxx, Esquire, a partner in this firm,
is a director of PECO Energy Company. We have rendered and continue to render
legal services to PECO Energy Company.
The foregoing opinion is solely for your benefit and may not be relied
upon by any other Person other than any Person that may become a lender under
the Credit Agreement after the date hereof.
Very truly yours,
NJS:RKM
EXHIBIT F
FORM OF ANNUAL AND QUARTERLY COMPLIANCE CERTIFICATE
______________________, 19/20__
Pursuant to the 364-Day Credit Agreement, dated as of September 15,
1999, among PECO Energy Company, as Borrower, the banks named therein, as Banks,
The First National Bank of Chicago, as Administrative Agent, Citibank, N.A., as
Documentation Agent, and Banc One Capital Markets, Inc., as Lead Arranger (as
amended, modified or supplemented from time to time, the "Credit Agreement"),
the undersigned, being ______________________ of the Borrower, hereby certifies
on behalf of the Borrower as follows:
1. Delivered herewith are the financial statements prepared pursuant to
Section 5.01(b)(ii) and Section 5.01(b)(iii) of the Credit Agreement, for the
fiscal ________ ended ___________, 19/20__. All such financial statements comply
with the applicable requirements of the Credit Agreement.
2. Schedule I hereto sets forth in reasonable detail the information
and calculations necessary to establish compliance with the provisions of
Section 5.02(c) of the Credit Agreement as of the end of the fiscal period
referred to in paragraph 1 above.
3. (Check one and only one:)
__ No Event of Default, or event which with notice or lapse of time or
both would constitute an Event of Default, has occurred and is continuing or
exists.
__ An Event of Default, or event which with notice or lapse of time or
both would constitute an Event of Default, has occurred and is continuing or
exists, and the document(s) attached hereto as Schedule II specify in detail the
nature and period of existence of such Event of Default or such other event as
well as any and all actions with respect thereto taken or contemplated to be
taken by the Borrower.
4. The undersigned has personally reviewed the Credit Agreement, and
this certificate was based on an examination made by or under the supervision of
the undersigned sufficient to assure that this certificate is accurate.
5. Capitalized terms used in this certificate and not otherwise defined
shall have the meanings given in the Credit Agreement.
PECO ENERGY COMPANY
By_______________________________________
Name:____________________________________
Title:___________________________________
Date:__________________
EXHIBIT G
FORM OF ADDITIONAL LENDER SUPPLEMENT
THIS SUPPLEMENT, dated as of ____________, 19/20_____, by the
undersigned.
Recitals:
A. This Supplement is being executed and delivered in accordance with
Section 2.17 of the 364-Day Credit Agreement, dated as of September 15, 1999,
among PECO Energy Company, as Borrower, the banks named therein, as Banks, The
First National Bank of Chicago, as Administrative Agent, Citibank, N.A., as
Documentation Agent, and Banc One Capital Markets, Inc., as Lead Arranger (as
amended, modified or supplemented from time to time, the "Credit Agreement").
Capitalized terms used herein without definition have the meanings specified in
the Credit Agreement.
B. The undersigned wishes to become a Lender party to the Credit
Agreement, as an Additional Lender.
NOW, THEREFORE, the undersigned, intending to be legally bound, hereby
agrees as follows:
1. The undersigned hereby becomes party to the Credit Agreement as
Lender thereunder, and shall be subject to and bound by all of the provisions
thereof.
2. The Commitment of the undersigned shall be $_____________.
3. The undersigned (i) confirms that it has received a copy of the
Credit Agreement, together with copies of the financial statements referred to
in Section 4.01 thereof and such other documents and information as it has
deemed appropriate to make its own credit analysis and decision to enter into
this Additional Lender Supplement; (ii) agrees 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 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 under the Credit Agreement as are
delegated to the Administrative Agent by the terms thereof, together with such
powers as are reasonably incidental thereto; (v) agrees that it will perform in
accordance with their terms all of the obligations which by the terms of the
Credit Agreement are required to be performed by it as a Lender; (vi) none of
the consideration used to make the purchase being made by the undersigned
hereunder are "plan assets" as defined under ERISA and the rights and interests
of the undersigned in and under the Credit Agreement will not be "plan assets"
under ERISA [and] (vii) specifies as its Domestic Lending Office (and address
for notices) and Eurodollar Lending Office the offices set forth beneath its
name on the signature pages hereof [and (viii) attaches the forms prescribed by
the Internal Revenue Service of the United States certifying that it is exempt
from United States withholding taxes with respect to all payments to be made to
the undersigned under the Credit Agreement and the Notes].(3)
---------------------
(3) If the undersigned is organized under the laws of a jurisdiction outside the
United States.
4. This Supplement shall be effective upon the date of acceptance
thereof by the Administrative Agent, unless otherwise specified under the
undersigned's name signature below.
5. THIS SUPPLEMENT SHALL BE GOVERNED BY, AND CONSTRUED IN ACCORDANCE
WITH, THE LAWS OF THE COMMONWEALTH OF PENNSYLVANIA.
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.
[NAME OF ADDITIONAL LENDER]
By:_________________________________
Name:_______________________________
Title:______________________________
Domestic Lending Office (and
address for notices): [Address]
Eurodollar Lending Office: [Address]
Effective Date(4):________, 19/20__
CONSENTED TO:
[NAME OF ADMINISTRATIVE AGENT]
By:_________________________________
Name:_______________________________
Title:______________________________
CONSENTED TO:
PECO ENERGY COMPANY
By:_________________________________
Name:_______________________________
Title:______________________________
-----------------
(4) This date should be no earlier than the date of acceptance by the
Administrative Agent.
