CREDIT SUISSE FIRST BOSTON XXXXXX COMMERCIAL PAPER INC.
August 6, 1997
CalEnergy Company, Inc.
000 Xxxxx 00xx Xxxxxx
Xxxxx 000
Xxxxx, Xxxxxxxx 00000
Re: Commitment Letter
Dear Gentlemen:
CalEnergy Company, Inc., a Delaware corporation (the
"Company"), intends to amend and restate the Amended and Restated Credit
Agreement, dated as of July 8, 1996 (as currently in effect, the "Existing
Credit Agreement") among the Company, the banks and other financial
institutions parties thereto, Credit Suisse First Boston ("CSFB") and National
Westminster Bank PLC ("NatWest") as L/C Issuers, NatWest, as Documentation
Agent, CSFB, as Administrative Agent and CSFB and NatWest as Co-Arrangers, as
described herein. You have requested CSFB and Xxxxxx Commercial Paper Inc
("LB") to commit to provide the entirety of such amended and restated facility
which will be in the form of a 3-year revolving loan and standby letter of
credit facility in the amount of U.S. $250 million (such amended and restated
facility, the "Credit Facility"). A summary of the terms and conditions of the
Credit Facility will be the same as those set forth in the Existing Credit
Agreement with only such changes as are set forth in the attached Summary of
Terms and Conditions (the "Term Sheet").
We are pleased to confirm that CSFB and LB each hereby
commits (the "Commitments") to provide one-half of the entire Credit Facility
on the terms and conditions set forth herein and in the Term Sheet. Those
matters that are not covered or made clear herein or in the Term Sheet are
subject to mutual agreement of the parties. In addition, the commitment of
CSFB and LB is subject to: (a) the preparation, execution and delivery of
mutually acceptable loan documentation, including a credit agreement
incorporating substantially the terms and conditions outlined herein and in
the Term Sheet; (b) the absence of any material adverse change in the
business, assets, operations, properties, prospects or condition (financial or
otherwise) of the Company and its subsidiaries, taken as a whole, since
December 31, 1996; (c) our not becoming aware after
CalEnergy Company, Inc.
August 6, 1997
Page 2
the date hereof of any information or other matter which is inconsistent in a
material manner with any information or other matter disclosed to us prior to
the date hereof; (d) prior to December 31, 1997, the absence of any competing
bank credit for, or debt securities of, the Company, being arranged, offered
or placed, other than the facilities described in separate letters among us,
unless the syndication has been completed as agreed among the parties prior to
such date; (e) the Co-Arrangers shall be satisfied with the financial
projections concerning the Company and its subsidiaries which have been or
will be prepared and delivered to the Co-Arrangers in connection with the
Credit Facility and (f) the other conditions set forth in the Term Sheet.
In connection with the Credit Facility, CSFB shall act as
sole administrative agent, CSFB and LB shall act as co-arrangers and LB shall
act as documentation agent. You agree that no other entity shall have any
title with respect to the Credit Facility or shall be appointed in the
capacity of agent, co-agent or arranger without the consent of the Company,
CSFB and LB. We reserve the right, prior to or after execution of the
definitive documentation for the Credit Facility, to syndicate all or part of
our commitment to one or more financial institutions or other "accredited
investors" (as defined in Regulation D of the Securities Act of 1933, as
amended) reasonably acceptable to the Company, CSFB and LB (collectively, the
"Lenders" and each a "Lender") that will become parties to such definitive
documentation pursuant to a syndication to be managed and controlled in all
respects by CSFB and LB (including, without limitation, as to the timing of
all offers to potential Lenders and acceptance of commitments, the amounts
offered and the compensation provided to potential Lenders) and that CSFB
would act as the sole and exclusive administrative agent for such Lenders (in
such capacity, the "Agent"). By your acceptance hereof, you agree both before
and after the closing of the Credit Facility to actively assist us in
achieving a syndication that is satisfactory to us, which assistance shall
include but not be limited to: (a) making senior management and
representatives of the Company and its affiliates available to participate in
one or more meetings with potential Lenders at such times and places as CSFB
and LB may reasonably request; (b) using all reasonable efforts to ensure that
the syndication efforts benefit from the Company's and its affiliates'
existing banking relationships; and (c) providing CSFB and LB with information
reasonably deemed necessary to complete the syndication successfully,
including, without limitation, the preparation of such offering materials as
CSFB and LB may reasonably request.
The Company hereby represents, warrants and covenants that
(x) all information (other than projections) and data concerning the Company
and its subsidiaries which has been or is hereafter furnished or otherwise
made available to CSFB and LB by the Company or any of its representatives in
connection with the transactions contemplated hereby is and will be complete
and correct in all material respects and does not and will
CalEnergy Company, Inc.
August 6, 1997
Page 3
not contain any untrue statement of a material fact or omit to state a
material fact necessary in order to make the statements contained therein not
misleading in light of the circumstances under which such statements are made
and (y) all financial projections concerning the Company and its subsidiaries
which have been or are hereafter made available to CSFB and LB or any Lender
have been or will be prepared based upon reasonable assumptions and will
constitute the Company's good faith estimate of the items projected. In
issuing this commitment and undertaking, CSFB and LB relying on the accuracy
of the information furnished by the Company and on the Company's behalf.
To induce us to issue this letter, the Company hereby agrees
to pay on demand, whether or not the Credit Facility is closed or signed, all
reasonable costs and expenses (including the reasonable fees and expenses of
Skadden, Arps, Slate, Xxxxxxx & Xxxx LLP as counsel to the Agent, any local
counsel retained to represent the Agent and all of the out-of-pocket expenses
of CSFB, LB and their respective affiliates) incurred by CSFB and LB in
connection with the preparation, execution and delivery of this letter and the
definitive financing agreements for the Credit Facility (and our due diligence
and syndication efforts in connection therewith). In addition, you hereby
agree to pay when and as due the fees described in the Fee Letter referred to
below. You further agree to indemnify and hold harmless CSFB, LB, each Lender
and each director, officer, employee and affiliate thereof (each an
"indemnified person") in connection with any losses, claims, damages,
liabilities or other expenses to which any such indemnified person may become
subject, insofar as such losses, claims, damages, liabilities (or actions or
other proceedings commenced or threatened in respect thereof) or other
expenses arise out of or in any way relate to or result from this letter (or
any element thereof) or the extension of the Credit Facility contemplated by
this letter, or in any way arise from any use or intended use of this letter
or the proceeds of any of the Credit Facility contemplated by this letter, and
you agree to reimburse each indemnified person for any reasonable legal or
other expenses incurred in connection with investigating, defending or
participating in any such loss, claim, damage, liability or action or other
proceeding (whether or not such indemnified person is a party to any action or
proceeding out of which any such expenses arise), provided that you shall have
no obligation hereunder to indemnify any indemnified person for any loss,
claim, damage, liability or expense to the extent it is determined by final
judgment of a court of competent jurisdiction to have resulted from the gross
negligence or willful misconduct of such indemnified person. This letter is
furnished for your benefit, and may not be relied upon by any other person or
entity. Neither CSFB, LB, any Lender nor any of their respective affiliates
shall be responsible or liable to you or any other person for consequential
damages which may be alleged as a result of this letter.
CSFB and LB each reserves the right to employ the services
of their respective affiliates in providing the services contemplated by this
letter and to allocate,
CalEnergy Company, Inc.
August 6, 1997
Page 4
in whole or in part, to such affiliates certain fees payable to CSFB and LB in
such manner as CSFB and LB and their respective affiliates may agree in their
sole discretion. You acknowledge that CSFB and LB may share with any of their
respective affiliates, and such affiliates may share with CSFB and LB, any
information relating to the Company and its respective subsidiaries and
affiliates (including, without limitation, any non-public information
regarding the Company and its subsidiaries and affiliates), subject to CSFB's
and LB's maintaining the confidential treatment of such confidential
information.
The provisions of the two immediately preceding paragraphs
shall survive any termination of this letter.
The provisions of this letter are supplemented as set forth
in a separate fee letter dated the date hereof from us to you (the "Fee
Letter") and are subject to the terms of such Fee Letter. By executing this
letter, you acknowledge that this letter, the Term Sheet and the Fee Letter
are the only agreements between you, CSFB and LB with respect to the Credit
Facility and set forth the entire understanding of the parties with respect
thereto. None of this letter, the Term Sheet nor the Fee Letter may be changed
except pursuant to a writing signed by each of the parties hereto.
You agree that this letter is for your confidential use only
and you are not authorized to show or disclose this letter or the contents
thereof in any public filing or announcement or to any other person or entity
(other than your legal and financial advisors in connection with your
evaluation hereof and on a confidential basis) provided that after such time
as you have accepted this letter and the Fee Letter as provided below you may
make such disclosure of this letter (but not the Fee Letter) as is required by
law or regulation in the opinion of your counsel. If this letter is not
accepted by you as provided below, you are directed to immediately return this
letter (and any copies hereof) to CSFB.
Our commitment pursuant to this letter shall terminate at
5:00 p.m. (New York time) on August 6, 1997 unless you shall have accepted
this letter and the enclosed fee letter on or prior to such date and shall in
any event terminate at 5:00 p.m. (New York time) on October 15, 1997 unless
definitive credit documentation acceptable to each of us has been executed and
delivered.
If you are in agreement with the foregoing, please sign and
return to CSFB the two enclosed copies of this letter, together with two
executed copies of the accompanying fee letter fully executed by the parties
thereto. This letter may be executed in any number of counterparts and by the
different parties hereto on separate counterparts, each
CalEnergy Company, Inc.
August 6, 1997
Page 5
of which when executed and delivered shall be an original, but all of which
shall together constitute one and the same instrument. This letter, the Term
Sheet and the Fee Letter shall be governed by and construed in accordance with
the laws of the State of New York. the Company hereby irrevocably waives all
rights to trial by jury of any actions, proceeding or counterclaim (whether
based on contract, tort or otherwise) arising out of or relating to this
letter, the transactions contemplated hereby or the actions of CSFB or LB in
negotiation, performance or enforcement hereof.
CalEnergy Company, Inc.
August 6, 1997
Page 6
We are pleased to have been given the opportunity to assist
you in connection with the Credit Facility.
Very truly yours,
CREDIT SUISSE FIRST BOSTON
By: /s/ Xxxxxxx Xxxxx
---------------------------
Title: Director
By: /s/ Xxxxx Xxxxx
---------------------------
Title: Director
XXXXXX COMMERCIAL PAPER INC.
By: /s/ Xxxxxx X. Xxx
------------------------------
Title: Authorized Signatory
Agreed to and Accepted this 6th day of August, 1997.
CALENERGY COMPANY, INC.
By: /s/ Xxxxxx X. XxXxxxxx
--------------------------
Title: Senior Vice President,
General Counsel and
Secretary
SUMMARY OF TERMS AND CONDITIONS
Borrower: CalEnergy Company, Inc. ("CalEnergy"). CalEnergy is
referred to herein as "Borrower."
Purpose: Borrowings shall be used for general corporate
purposes, including permitted new business
developments and acquisitions.
Amount: $250,000,000 (the "Credit Facility").
Co-Arrangers: Credit Suisse First Boston and Xxxxxx Commercial
Paper Inc.
Administrative
Agent: Credit Suisse First Boston (in such capacity, the
"Agent").
Documentation
Agent: Xxxxxx Commercial Paper Inc.
Letter of Credit
Issuer: Credit Suisse First Boston.
Banks: A syndicate of financial institutions acceptable to
Borrower and the Co-Arrangers.
Facility
Description: A fully revolving credit facility with a final
maturity on the third anniversary of the Closing
Date. On the second and third anniversary of
closing, the Credit Facility may be extended for
a one-year period at the request of Borrower,
subject to the consent of all of the Banks.
Borrower may utilize up to $100,000,000 of the
Credit Facility to request Letters of Credit.
The Credit Agreement will provide that: (1) for at
least one period of 30 consecutive days or at least
three periods of 15 consecutive days each in each
12-month period, there shall
be no outstanding Loans or unreimbursed drawings
under Letters of Credit, and (2) Letters of Credit
may not be used to fund, directly or indirectly,
any debt service reserve.
Rank: The Credit Facility will be pari passu with all
existing and future senior indebtedness of the
Borrower, subject to permitted liens set forth in
the covenant relating to negative pledge of the
Borrower described below.
Borrowing Options: Eurodollar Rate and Base Rate.
Eurodollar Rate will be adjusted for reserves and
other regulatory requirements.
Base Rate means the higher of Credit Suisse First
Boston's prime rate or the federal funds rate
+0.50%.
Commitment Fee: See attached pricing schedule - A per annum
fee calculated on a 360-day basis payable on the
unused portion of the facility quarterly in arrears
and on termination of the Credit Facility.
Margins on Loans: See attached pricing schedule -
Calculated on a 360-day basis (in the case of
Eurodollar Rate Loans) or a 365 or 366 day basis
(as applicable, in the case of Base Rate Loans).
Letters of
Credit Fee: See attached pricing schedule - A per annum
fee calculated on a 360-day basis payable on
Letters of Credit issued and outstanding quarterly
in arrears and on termination of the facility.
Interest Payments: Eurodollar Rate Loans, at the end of each applicable
Interest Period or quarterly, if earlier. Base Rate
Loans, on the last business day of each calendar
quarter.
Interest Periods: Eurodollar Rate Loans - 1, 2, 3 or 6 months, and,
if available, 9 or 12 months. Letters of Credit -
maximum term - 12 months.
2
Drawdowns: Minimum amounts of $1 million with additional
increments of $1 million. Drawdowns are at the
Borrower's option with one business day's notice
for Base Rate Loans and three business days' notice
for Eurodollar Rate Loans.
Letters of Credit: Issuance on ten business days' notice.
Prepayments: Loans may be prepaid at the option of Borrower at
any time on at least three business days' notice in
whole or in part in minimum amounts of $1 million
and integral multiples thereof; provided that
Borrower shall be required to indemnify the Banks
for funding losses resulting from any prepayment
other than at the end of an Interest Period.
Mandatory
Repayments: Borrower is required to repay outstanding Loans or
cash collateralize outstanding Letters of Credit to
the extent that outstanding Loans and Letters of
Credit exceed the aggregate Commitments (including
by reason of any reduction of Commitments as
provided below).
Termination or
Reduction of
Commitments: CalEnergy may terminate or reduce the Commitments
in amounts of at least $5 million at any time on at
least three business days' notice.
In the event that Borrower or any of its
Subsidiaries shall at any time, or from time to
time, receive any net proceeds in excess of
$100,000,000 from Asset Dispositions made during
any fiscal year, Borrower shall give prompt written
notice thereof to the Agent, and the Commitments of
the Banks shall, at the election of Majority Banks,
be ratably reduced (pro rata with the revolving
credit facility in the maximum principal amount of
$150 million (the "Other Facility") as contemplated
by that separate commitment letter among the
Borrower and the Co-Arrangers, provided that the
Commitments, together with the commitments under
the Other Facility, shall not be reduced to an
aggregate amount less than $250 million) by such
amounts up to
3
such excess and at such times as the Agent or
Majority Banks may direct.
Representations
and Warranties: Same as set forth in the Existing Credit Agreement
(except for changes indicated by *), and updated as
appropriate, as follows:
1. Organization.
2. Authorization of Credit Documents.
3. Consents.
4. No Conflicts.
5. Enforceability of Credit Documents.
6. Title to Property; Sufficiency of Assets.
7. Compliance with Law.
8. No Litigation.
9. Events of Default.
10. Financial Condition.
11. No Material Adverse Effect.
12. No Default.
13. No Burdensome Restrictions.
14. Taxes.
15. ERISA and IRC Compliance Liability.
16. Funding.
4
17. Prohibited Transactions and Payments.
18. No Termination Event.
19. ERISA Litigation.
20. No Other Obligations.
21. Margin Regulations.
22. Investment Company Act and Public Utility
Holding Company Act of 1935.
23. Environmental Matters.
24. Disclosure.
25. Insurance.
26. SEC Filings of Borrower.
27. Projections (to conform to requirements
set forth therefor in the Commitment
Letter)*.
28. Patents, Licenses, Franchises and Formulas.
Conditions
Precedent
to Closing: Same as set forth in the Existing Credit Agreement
(except for changes indicated by *), and updated as
appropriate, as follows:
1. Certificate of Incorporation or
Organizational Documents.
2. Certificate of Good Standing.
3. Certificate of Qualification.
4. By-laws and Resolutions.
5
5. Incumbency Certificate.
6. Opinions of Counsel.
7. Fees.
8. Notes.
9. Notice of Borrowing or Request for Letter
of Credit Issuance.
10. Officer's Certificate.
11. Confirmation of Agent for Service.
12. Financial Statements.
13. Performance of Agreements.
14. Government Approvals and Litigation.
15. Material Adverse Effect.
16. Projections.
17. Compliance with Margin Regulations.*
Conditions to
all Borrowings
and Issuance: 1. Accuracy of representations and warranties,
including absence of material adverse
change to the Borrower.
2. Absence of default.
3. The sum of all Loans and Letters of Credit
obligations shall not exceed the total
amount of all Commitments.
Covenants: Same as set forth in the Existing Credit Agreement
(except for changes indicated by *), as follows:
6
1. Payment of Taxes.
2. Maintenance of Insurance.
3. Preservation of Corporate Existence.
4. Compliance with Laws.
5. Inspection Rights.
6. Keeping of books by Borrower and its
Subsidiaries in accordance with GAAP.
7. Maintenance of Properties.
8. Reporting Requirements.
9. Use of Proceeds.
10. Use of Net Cash Proceeds from Asset
Dispositions. In the event that the Borrower's
senior unsecured debt rating established by
Standard and Poors Inc. or Xxxxx'x Investor
Services Inc. is at least BB- or Ba3, respectively,
Borrower shall use the Net Cash Proceeds from any
Asset Disposition within 365 days of such Asset
Disposition or receipt of the Net Cash Proceeds
thereof to either (i) invest in the business of
Borrower, any of its Restricted Subsidiaries or any
Eligible Joint Venture or (ii) apply such Net Cash
Proceeds to the payment of any Debt of Borrower or
any of its Restricted Subsidiaries or any Eligible
Joint Venture (or as otherwise required under the
terms of such Debt), provided that, no such payment
of Debt (A) under the Credit Agreement evidencing
the Credit Facility or any other revolving credit
agreement shall count for this purpose unless the
related loan commitment, standby facility or the
like shall be permanently reduced by an amount
equal to the principal amount so repaid and (B)
owed to Borrower, a Restricted Subsidiary thereof
or an Eligible Joint Venture shall count for this
purpose. If in the case of any sale of assets
located outside the United States, repatriation of
proceeds is prohib-
7
ited or delayed under applicable law, or such
registration would result in material adverse tax
consequences to Borrower, Borrower's obligations in
respect of the applicable net proceeds may be
returned outside the United States until such
prohibition, delay or adverse consequence no longer
continues.*
Remainder of this covenant shall be the same as set
forth in the Existing Credit Agreement.
11. Negative pledge with respect to Borrower
with customary exceptions.
12. Negative pledge with respect to Restricted
Subsidiaries and Eligible Joint Ventures with
customary exceptions.
13. Limitations on Fundamental Changes.
14. Nature of business.
15. Fiscal Year.
16. Limitations on transactions with
affiliates.
17. Restricted Payments.
18. Limitations on Debt. Borrower shall not
create, incur, assume or otherwise become or remain
directly or indirectly liable with respect to any
Debt, except:
(i) subject to clean-up periods, the
Obligations under the Credit
Agreement; and
(ii) other Debt the incurrence of which
was permitted under the
following proviso;
provided that no Debt may be incurred by Borrower,
unless after giving effect thereto, (i) no Default
or Event of Default would exist or be created
thereby, (ii) the Borrower's senior unsecured debt
is rated at least both BB- by Standard &
8
Poors Inc. and Ba3 by Xxxxx'x Investor Services
Inc., and (iii) either (after giving effect to such
incurrence, the use of the proceeds thereof and
giving pro forma effect to acquisitions and
dispositions as of the beginning of the measurement
period) (A) the Cash Flow Coverage Ratio is not
less than 2.00 to 1.00 as of the date of incurrence
of such Debt or (B) the Borrower's senior unsecured
debt rating shall not be downgraded below BB or
Ba2, as the case may be.*
Other provisions of this covenant shall be as set
forth in the Existing Credit Agreement.
19. Subordinated Debt.
20. Compliance with ERISA.
21. No Restrictions on Distributions.
22. Limitation on Certain Sale-Leasebacks.
23. Limitation on Sale of Subsidiary Preferred
Stock.
24. Restrictions on Acquisitions, Etc.*
Borrower shall not, and shall not permit any of its
Restricted Subsidiaries or any Eligible Joint
Venture to, in any fiscal year, make any
acquisition of any capital stock or equity interest
of any person or entity (other than investments in
Restricted Subsidiaries or Eligible Joint Ventures
made in connection with the development,
construction, design, operation, servicing or
management of one or more newly developed or
constructed or existing Permitted Facilities), or
the purchase or acquisition of all or a substantial
part of the assets or business of, any person or
entity unless, after giving effect to any such
purchase or acquisition, the equity contribution
component of any such purchase or acquisition price
to be paid in such cash therefor, together with the
equity contribution component of any such cash
purchase or acquisition price of all other
purchases and acquisitions during such year
(excluding the acquisition of New York State
Electric & Gas Corporation or any equity interests
therein), does not
9
exceed 5.00 times the Parent Net Operating Cash
Flow (defined as the sum of dividends from any
Subsidiary, management fees, royalty fees, net
proceeds from exercise of options granted to
purchase capital stock of Borrower, tax sharing
payments, consulting service revenues, interest
income on cash held by Borrower, and all other cash
flows from Subsidiaries to Borrower other than the
proceeds of any material disposition of any
interest therein other than in connection with a
recapitalization, minus corporate overhead,
development costs, royalty payments of Borrower,
taxes of Borrower and its Subsidiaries and all
distributions to Subsidiaries (whether in the form
of loans, advances, capital contributions,
management fees, or otherwise)) for such year.
25. Cash Flow Coverage Ratio.
26. Total Debt to Cash Flow Ratio.
27.* Consolidated EBITDA to Consolidated
Interest Expense. On a trailing four quarters
basis, the ratio of Consolidated EBITDA (defined as
earnings before interest, taxes, depreciation and
amortization on a consolidated basis) to
Consolidated Interest Expense (defined as total
interest expense of the Borrower on a consolidated
basis) shall not be greater than the levels to be
mutually agreed upon.
28.* Consolidated Debt to Capital. On a trailing
four quarters basis, the ratio of Consolidated
Total Debt to Capital (defined as the sum of
Consolidated Total Debt of the Borrower plus
stockholders' equity of the Borrower and its
Subsidiaries shall not be greater than the levels
to be mutually agreed upon.
Events of Default: Same as set forth in the Existing Credit Agreement
(except for changes indicated by *) as follows:
1. Failure to pay any interest, principal, or
fees payable under the Credit Agreement when due.
10
2. Violation of any covenant or agreement in
the Credit Agreement (subject to grace periods and
cure rights, where appropriate).
3. Representations or warranties false in any
material respect when made.
4. Borrower shall fail to make any payment of
principal of $1 million or more with respect to
debt, within any applicable grace period, whose
aggregate principal amount is $50 million or more
or any interest or premium thereon, when due.
5. Change of ownership or control. Triggers
if a person or group, other than the Kiewit
Entities, acquires more than 35% of the voting
stock of Borrower.*
6. An event of default shall have occurred
under the Indenture, dated as of March 24, 1994,
between the Borrower and IBJ Xxxxxxxx Bank & Trust
Company, relating to Borrower's 10 1/4% Senior
Discount Notes due 2004, in the aggregate amount of
$529,640,000, in the Indenture, dated as of
September 20, 1996, between the Borrower and IBJ
Xxxxxxxx Bank & Trust Company, relating to
Borrower's 9 1/2% Senior Notes due 2006, in the
aggregate amount of $225,000,000 or in respect of
any other agreement evidenc ing debt with an
aggregate original principal amount of $100,000,000
or more.*
7. Other usual defaults with respect to
Borrower and its Subsidiaries, relating to taxes,
insolvency, bankruptcy, ERISA, judgment defaults
and invalidity of any provision of any credit
document (if such invalidity is reasonably expected
to have a Material Adverse Effect (as defined in
the Existing Credit Agreement).
11
Increased Costs/
Change of
Circumstances: The Credit Agreement will contain provisions the
same as set forth in the Existing Credit Agreement
with respect to protecting the Banks in the event
of unavailability of funding, illegality, increased
costs and funding losses.
Indemnification: Borrower will indemnify the Banks the same as set
forth in the Existing Credit Agreement with respect
to all losses, liabilities, claims, damages, or
expenses relating to their Loans, the Letters of
Credit, the Credit Agreement, Borrower's use of
Loan proceeds or the Commitments, including but not
limited to reasonable attorneys' fees and
settlement costs.
Assignments and
Participation: Banks will have the right to transfer or sell
participations in their Loans, Letter of Credit
participations or Commitments, the same as set
forth in the Existing Credit Agreement with
respect to with the transferability of voting
rights limited to changes in principal, rate, fees
and term. Assignments, which must be in amounts
of at least $5 million, will be allowed with the
consent of Borrower and the Agent, provided that no
such consent shall be required for assignment
within the Bank group, to Banks' affiliates or to
the Federal Reserve Bank.
Co-Arrangers'
Counsel: Skadden, Arps, Slate, Xxxxxxx & Xxxx LLP.
Governing Law: State of New York.
12
PRICING SCHEDULE
The "Applicable Margin," "Applicable Commitment Fee Rate"
and "Applicable L/C Fee Rate" for any day are the respective percentages set
forth below in the applicable row under the column corresponding to the Status
that exists on such day:
---------------------------------------------------------------------------------------------------------------------
Status Level I Level II Level III Level IV Level V
---------------------------------------------------------------------------------------------------------------------
Applicable Margin -
Eurodollar Rate Loans 0.75% 1.25% 1.50% 1.75% 2.25%
---------------------------------------------------------------------------------------------------------------------
Applicable Margin -
Base Rate Loans 0.00% 0.00% 0.25% 0.50% 1.00%
---------------------------------------------------------------------------------------------------------------------
Applicable Commit-
ment Fee Rate 0.25% 0.30% 0.30% 0.375% 0.50%
---------------------------------------------------------------------------------------------------------------------
Applicable L/C Fee
Rate 0.75% 1.25% 1.50% 1.75% 2.25%
---------------------------------------------------------------------------------------------------------------------
For purposes of this Schedule, the following terms have the
following meanings:
"Level I Status" exists at any date if, at such date,
Borrower's senior unsecured long-term debt is rated both BBB- or higher by S&P
and Baa3 or higher by Xxxxx'x.
"Level II Status" exists at any date if, at such date (i)
Borrower's senior unsecured long-term debt is rated both BB+ or higher by S&P
and Ba1 or higher by Xxxxx'x and (ii) Level I Status does not exist.
"Level III Status" exists at any date if, at such date (i)
Borrower's senior unsecured long-term debt is rated both BB or higher by S&P
and Ba2 or higher by Xxxxx'x and (ii) neither Level I Status nor Level II
Status exists.
"Level IV Status" exists at any date if, at such date (i)
Borrower's senior unsecured long-term debt is rated both BB- or higher by S&P
and Ba3 or higher by Xxxxx'x and (ii) none of Level I Status, Level II Status
and Level III Status exists.
13
"Level V Status" exists at any date if, at such date, no
other Status exists.
"Status" refers to the determination which of Level I
Status, Level II Status, Level III Status, Level IV Status or Level V Status
exists at any date.
The credit ratings to be utilized for purposes of this Schedule are those
assigned to the senior unsecured long-term debt securities of Borrower
(including, if no senior unsecured long-term debt securities of Borrower are
outstanding, any such ratings that Xxxxx'x or S&P has explicitly stated may be
implied from the ratings it has assigned to Borrower's outstanding
subordinated unsecured long-term debt securities) without third-party credit
enhancement, and any rating assigned to any other debt security of Borrower
shall be disregarded. The rating in effect at any date is that in effect at
the close of business on such date.
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