CREDIT AGREEMENT
Dated as of November 17, 2000
THIS CREDIT AGREEMENT is made by and among:
(i) Northeast Utilities, an unincorporated voluntary business association
organized under the laws of the Commonwealth of Massachusetts ("NU" or the
"Borrower");
(ii) The financial institutions (the "Banks") listed on the signature pages
hereof and the other Lenders (as hereinafter defined) from time to time party
hereto;
(iii) UNION BANK OF CALIFORNIA, N.A. ("Union Bank"), as Administrative
Agent for the Lenders hereunder; and
(iv) BANK ONE, NA, as Fronting Bank.
PRELIMINARY STATEMENT
The Borrower has requested the Banks and the Fronting Bank to provide
the credit facility hereinafter described in the amounts and on the terms and
conditions set forth herein. The Banks and the Fronting Bank have so agreed
on the terms and conditions set forth herein, and the Administrative Agent
has agreed to act as agent for the Lenders on such terms and conditions.
Based upon the foregoing and subject to the terms and conditions set
forth in this Agreement, the parties hereto hereby agree as follows:
ARTICLE I
DEFINITIONS AND ACCOUNTING TERMS
SECTION I.01. Certain Defined Terms. As used in this Agreement, the
following terms shall have the following meanings (such meanings to be
applicable to the singular and plural forms of the terms defined):
"Account Party" has the meaning set forth in Section 2.02(a).
"Administrative Agent" means Union Bank, in its capacity as
administrative agent hereunder, or any successor thereto as provided herein.
"Advance" means a Contract Advance.
"Affiliate" means, with respect to any Person, any other Person directly
or indirectly controlling (including, but not limited to, all directors and
officers of such Person), controlled by, or under direct or indirect common
control with such Person. A Person shall be deemed to control another entity
if such Person possesses, directly or indirectly, the power to direct or
cause the direction of the management and policies of such entity, whether
through the ownership of voting securities, by contract or otherwise.
"Agreement" means this Credit Agreement, as the same may be modified,
amended and/or supplemented pursuant to the terms hereof.
"Applicable Commitment Fee Rate" means, for any day, the percentage per
annum set forth below in effect on such day, determined on the basis of the
Applicable Rating Level of the Borrower:
Applicable Commitment Fee Rate
Applicable Rating Level Percentage (%)
Level I 0.125
Level II 0.150
Level III 0.200
Level IV 0.375
Level V 0.500
Any change in the Applicable Commitment Fee Rate caused by a change in the
Applicable Rating Level shall take effect at the time such change in the
Applicable Rating Level shall occur.
"Applicable Lending Office" means, with respect to each Lender:
(i) in the case of any Contract Advance, (A) such Lender's "Eurodollar
Lending Office" in the case of a Eurodollar Rate Advance or (B) such Lender's
"Domestic Lending Office" in the case of a Base Rate Advance, in each case as
specified opposite such Lender's name on Schedule I hereto or in the Lender
Assignment pursuant to which it became a Lender; or
(ii) in each case, such other office of such Lender as such Lender may
from time to time specify in writing to the Borrower and the Administrative
Agent.
"Applicable Margin" means, for any day for any outstanding Contract
Advance, the percentage per annum set forth below in effect on such day,
determined on the basis of the Applicable Rating Level for the Borrower:
Applicable Margin (Percentage %)
Rating Level Eurodollar Utilization Base Rate Utilization
Rate Advances Margin for Advances Margin for
Eurodollar Base Rate
Rate Advances Advances
Level I 0.750 0.125 0.000 0.000
Level II 0.875 0.125 0.000 0.000
Level III 1.125 0.125 0.125 0.125
Level IV 1.750 0.000 0.750 0.000
Level V 2.250 0.000 1.250 0.000
provided, that (x) the Applicable Margin for Eurodollar Rate Advances shall
be increased by the rate per annum set forth above under the caption
"Utilization Margin for Eurodollar Rate Advances" that corresponds to the
Applicable Rating Level used to determine such Applicable Margin and (y) the
Applicable Margin for Base Rate Advances shall be increased by the rate per
annum set forth above under the caption "Utilization Margin for Base Rate
Advances" that corresponds to the Applicable Rating Level used to determine
such Applicable Margin, in any case, during any period in which the total
principal amount of Outstanding Credits is greater than one-third of the
Total Commitment. Any change in the Applicable Margin caused by a change in
the Applicable Rating Level shall take effect at the time such change in the
Applicable Rating Level shall occur.
"Applicable Rate" means, with respect to any Advance made to the
Borrower, either of (i) the Base Rate from time to time applicable to such
Advance plus the Applicable Margin, or (ii) the Eurodollar Rate from time to
time applicable to such Advance plus the Applicable Margin.
"Applicable Rating Level" shall be determined at any time and from time
to time on the basis of the ratings assigned by S&P and Moody's to the
senior, unsecured, non-credit enhanced long-term Debt of the Borrower (the
"Rated Debt") in accordance with the following:
Applicable Rating Level
S&P Moody's
Level I BBB+ or higher Baa1 or higher
Level II BBB Baa2
Level III BBB- Baa3
Level IV BB+ Ba1
Level V lower than BB+ lower than Ba1
In the event that the rating assigned by S&P to the Rated Debt and the
rating assigned by Moody's to the Rated Debt do not correspond to the same
Applicable Rating Level, then the lower of the two ratings shall determine
the Applicable Rating Level. The Applicable Rating Level shall be
redetermined as and when any change in the ratings used in the determination
thereof shall be announced by S&P or Moody's, as the case may be. If either
Moody's or S&P shall cease to issue or maintain a rating on the Rated Debt,
then the Applicable Rating Level shall be Level V.
"Available Commitment" means, for each Lender, the excess of such
Lender's Commitment over such Lender's Percentage of the Outstanding Credits.
"Available Commitments" shall refer to the aggregate of the Lenders'
Available Commitments hereunder.
"Banks" has the meaning assigned to that term in the caption to this
Agreement.
"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 highest of:
(a) the rate of interest announced publicly by the Administrative Agent
in its principal place of business from time to time as the Administrative
Agent's base rate;
(b) 1/2 of one percent per annum above the latest three-week moving
average of secondary market morning offering rates in the United States for
three-month certificates of deposit of major United States money market
banks, adjusted to the nearest 1/32 of one percent (the "CD Rate"); and
(c) 1/2 of one percent per annum above the Federal Funds Rate in effect
from time to time.
If the Administrative Agent shall have determined (which determination
shall be conclusive absent manifest error) that it is unable to ascertain the
CD Rate or the Federal Funds Rate for any reason, including the inability or
failure of the Administrative Agent to obtain sufficient quotations in
accordance with the terms thereof, the Base Rate shall be determined without
regard to clause (b) of the first sentence of this definition, in the event
the Administrative Agent is unable to ascertain the CD Rate, and clauses (c)
and (d) of the first sentence of this definition, in the event the
Administrative Agent is unable to ascertain the Federal Funds Rate, until the
circumstances giving rise to such inability no longer exist. Any change in
the Base Rate due to a change in the Administrative Agent's base rate, the CD
Rate or the Federal Funds Rate shall be effective on the effective date of
such change in the Administrative Agent's base rate, the CD Rate or the
Federal Funds Rate, respectively.
"Base Rate Advance" means a Contract Advance in respect of which the
Borrower has selected in accordance with Article III hereof, or this
Agreement provides for, interest to be computed on the basis of the Base
Rate.
"Beneficiary" means any Person designated by an Account Party to whom
the Fronting Bank is to make payment, or on whose order payment is to be
made, under a Letter of Credit.
"Borrower" has the meaning assigned to that term in the caption to this
Agreement.
"Borrowing" means a Contract Borrowing.
"Borrowing Sublimit" means $300,000,000.
"Business Day" means a day of the year on which banks are not required
or authorized to close in New York City and, if the applicable Business Day
relates to any Eurodollar Rate Advances, on which dealings are carried on in
the London interbank market.
"Cash Collateral Account" means an account maintained at the principal
domestic office of the Administrative Agent for the purpose, and subject to
the terms and conditions, set forth in Section 2.02(k).
"Change of Control" means (a) any Person or "group" (within the meaning
of Section 13(d) or 14(d) of the Securities Exchange Act of 1934, as
amended), other than Consolidated Edison, Inc., shall either (1) acquire
beneficial ownership of more than 50% of any outstanding class of common
stock of NU having ordinary voting power in the election of directors of NU
or (2) obtain the power (whether or not exercised) to elect a majority of
NU's directors or (b) except as a result of the acquisition of NU by
Consolidated Edison, Inc., the Board of Directors of NU shall not consist of
a majority of Continuing Directors. For purposes of this definition, the
term "Continuing Directors" means directors of NU on the Closing Date and
each other director of NU, if such other director's nomination for election
to the Board of Directors of NU is recommended by a majority of the then
Continuing Directors.
"CL&P" means The Connecticut Light and Power Company, a corporation
organized under the laws of the State of Connecticut.
"CL&P Indenture" has the meaning assigned to that term in
Section 7.02(a)(ii) hereof.
"Closing Date" has the meaning assigned to that term in Section 5.01
hereof.
"Commitment" means, for each Lender, the aggregate amount set forth
opposite such Lender's name on the signature pages hereof or, if such Lender
has entered into one or more Lender Assignments, set forth for such Lender in
the Register maintained by the Administrative Agent pursuant to
Section 10.07(c), in each such case as such amount may be reduced from time
to time pursuant to Section 2.04 hereof. "Commitments" shall refer to the
aggregate of the Lenders' Commitments hereunder.
"Common Equity" means, at any date for the Borrower, an amount equal to
the sum of the aggregate of the par value of, or stated capital represented
by, the outstanding common shares of the Borrower and its Subsidiaries and
the surplus, paid-in, earned and other capital, if any, of the Borrower and
its Subsidiaries, in each case as determined on a consolidated basis in
accordance with generally accepted accounting principles.
"Confidential Information" has the meaning assigned to that term in
Section 10.08 hereof.
"Consolidated EBIT" means, for any period (as determined on a
consolidated basis in accordance with generally accepted accounting
principles), the Borrower's and its Subsidiaries' net income for such period,
adjusted as follows:
(i) increased by the amount of federal and state income taxes to the extent
deducted in the computation of such Borrower's and/or its Subsidiaries'
consolidated net income for such period;
(ii) increased by the amount of Consolidated Interest Expense deducted in
the computation of the Borrower's and/or its Subsidiaries' consolidated net
income for such period;
(iii) increased by the amount of dividends on preferred stock deducted in
the computation of the Borrower's and/or its Subsidiaries' consolidated net
income for such period;
(iv) decreased (increased) by the gain (loss) on asset sales done outside
the ordinary course of business by the Borrower and/or its Subsidiaries to
the extent such gains (losses) are not offset by increases (decreases) in
amortization of regulatory assets, and to the extent such gain (loss) is
included in the computation of the Borrower's and/or its Subsidiaries'
consolidated net income for such period;
(v) decreased by the amount of revenues accrued by the Borrower and/or its
Subsidiaries related to interest on Stranded Cost Recovery Obligations of
Subsidiaries of the Borrower, and increased by the amount of operating
expenses accrued by the Borrower and/or its Subsidiaries related to interest
on Stranded Cost Recovery Obligations of Subsidiaries of the Borrower, in
each case to the extent included in the computation of the Borrower's and/or
its Subsidiaries' consolidated net income for such period; and
(vi) increased by the amount of the non-cash write-offs associated with the
September 8, 2000 PSNH restructuring settlement (PUC order no. 23,549) to the
extent included in the computation of the Borrower's and/or its Subsidiaries'
consolidated net income for such period.
"Consolidated Interest Expense" means, for any period, the aggregate
amount of any interest required to be paid during such period by the Borrower
and its Subsidiaries on Debt (including the current portion thereof) (as
determined on a consolidated basis in accordance with generally accepted
accounting principles), excluding interest required to be paid on the
Stranded Cost Recovery Obligations of any Subsidiary of the Borrower.
"Contract Advance" means an advance by a Lender to the Borrower pursuant
to Article III hereof, and refers to a Eurodollar Rate Advance or a Base Rate
Advance (each of which shall be a "Type" of Contract Advance). For purposes
of this Agreement, all Contract Advances of a Lender (or portions thereof) of
the same Type and Interest Period, if any, made or converted on the same day
to the Borrower shall be deemed to be a single Advance by such Lender until
repaid.
"Contract Borrowing" means a borrowing consisting of one or more
Contract Advances of the same Type and Interest Period, if any, made to the
Borrower on the same Business Day by the Lenders, ratably in accordance with
their respective Commitments. A Contract Borrowing may be referred to herein
as being a "Type" of Contract Borrowing, corresponding to the Type of
Contract Advances comprising such Borrowing. For purposes of this Agreement,
all Contract Advances of the same Type and Interest Period, if any, made or
converted on the same day to the Borrower shall be deemed a single Contract
Borrowing hereunder until repaid.
"Contract Note" means a promissory note of the Borrower payable to the
order of a Lender, in substantially the form of Exhibit 1.01A hereto,
evidencing the aggregate indebtedness of the Borrower to such Lender
resulting from the Contract Advances made by such Lender to the Borrower.
"Date of Issuance" means the date of issuance by the Fronting Bank of a
Letter of Credit under this Agreement.
"Debt" means, for any Person, without duplication, (i) indebtedness of
such Person for borrowed money, including but not limited to obligations of
such Person evidenced by bonds, debentures, notes or other similar
instruments (excluding Stranded Cost Recovery Obligations which are non-
recourse to such Person), (ii) obligations of such Person to pay the deferred
purchase price of property or services (excluding any obligation of such
Person to the United States Department of Energy or its successor with
respect to disposition of spent nuclear fuel burned prior to April 3, 1983),
(iii) obligations of such Person as lessee under leases which shall have been
or should be, in accordance with generally accepted accounting principles,
recorded as capital leases, (iv) 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 (iii), above, including all Parent Support
Obligations, (v) letters of credit, guaranties and other forms of credit
enhancement issued to support power sales and trading activities, and
(vi) liabilities in respect of unfunded vested benefits under ERISA Plans.
"Disclosure Documents" means for the Borrower and each Principal
Subsidiary: (i) such Person's Annual Report on Form 10-K for the fiscal year
ended December 31, 1999; (ii) its Quarterly Reports on Form 10-Q for the
fiscal quarters ended March 31 and June 30, 2000; (iii) each Current Report
on Form 8-K of such Person filed after June 30, 2000 and on or prior to
October 1, 2000; and (iv) the Information Memorandum.
"Drawing" means a drawing by a Beneficiary under any Letter of Credit.
"ERISA" means the Employee Retirement Income Security Act of 1974, as
amended from time to time.
"ERISA Affiliate" means, with respect to any Person, any trade or
business (whether or not incorporated) which is a "commonly controlled
entity" of such Person within the meaning of the regulations under
Section 414 of the Internal Revenue Code of 1986, as amended from time to
time.
"ERISA Multiemployer Plan" means a "multiemployer plan" subject to
Title IV of ERISA.
"ERISA Plan" means an employee benefit plan (other than a ERISA
Multiemployer Plan) maintained for employees of the Borrower or any ERISA
Affiliate of the Borrower and covered by Title IV of ERISA.
"ERISA Plan Termination Event" means (i) a Reportable Event described in
Section 4043 of ERISA and the regulations issued thereunder (other than a
Reportable Event not subject to the provision for 30-day notice to the PBGC
under such regulations) with respect to an ERISA Plan or an ERISA
Multiemployer Plan, or (ii) the withdrawal of the Borrower or any of its
ERISA Affiliates from an ERISA Plan or an ERISA Multiemployer Plan during a
plan year in which it was a "substantial employer" as defined in
Section 4001(a)(2) of ERISA, or (iii) the filing of a notice of intent to
terminate an ERISA Plan or an ERISA Multiemployer Plan or the treatment of an
ERISA Plan amendment as a termination or of an ERISA Multiemployer Plan
amendment as a termination under Section 4041 of ERISA, or (iv) the
institution of proceedings to terminate an ERISA Plan or an ERISA
Multiemployer Plan by the PBGC, or (v) any other event or condition which
might constitute grounds under Section 4042 of ERISA for the termination of,
or the appointment of a trustee to administer, any ERISA Plan or ERISA
Multiemployer Plan.
"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 Rate" means, for each Interest Period for each Eurodollar
Rate Advance comprising 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 rates
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 the amount of $1,000,000 and
for a period equal to such Interest Period. The Eurodollar Rate for the
Interest Period for each Eurodollar Rate Advance comprising 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 Sections 3.05(d) and 4.03(g).
"Eurodollar Rate Advance" means a Contract Advance in respect of which
the Borrower has selected in accordance with Article III hereof, or this
Agreement provides for, interest to be computed on the basis of the
Eurodollar Rate.
"Eurodollar Reserve Percentage" of any Lender or its subparticipant, for
each Interest Period for each 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 Regulation D or other 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, without benefit of or credit for proration, exemptions or
offsets) for such Lender or its subparticipant with respect to liabilities or
assets consisting of or including Eurocurrency Liabilities having a term
equal to such Interest Period.
"Event of Default" has the meaning specified in Section 8.01 hereof.
"Existing Credit Facility" means the credit facility provided under the
Credit Agreement, dated as of November 19, 1999, among NU, the lenders party
thereto, Union Bank, as administrative agent for the lenders thereunder, and
Bank One, NA, as fronting bank thereunder.
"Existing LCs" means letters of credit (i) issued under the Existing
Credit Facility; (ii) outstanding and available to be drawn as of the Closing
Date; and (iii) identified on Schedule III hereto.
"Expiration Date" means, with respect to a Letter of Credit, its stated
expiration date.
"Extension of Credit" means the making of any Advance or the issuance or
amendment (including, without limitation, an extension or renewal) of a
Letter of Credit.
"Extraordinary Proceeds" shall mean, for any Person for any period, net
proceeds received by such Person during such period from (i) issuances of
stranded cost recovery bonds plus (ii) sales of assets by such Person or any
of its Subsidiaries not in the ordinary course of business plus (iii) the
sale or disposition (by way of merger, sale of capital stock, sale of assets
or otherwise) of any Subsidiary of such Person. For purposes of the
foregoing, all cash received by such Person from, or as a result of the sale
or disposition of, a Subsidiary shall be deemed to constitute "Extraordinary
Proceeds" up to the amount of proceeds received by, or as a result of the
sale or disposition of, such Subsidiary from such issuances and sales during
the relevant period, net of underwriting discounts and commissions, costs of
sale and other, similar transaction costs.
"Federal Funds Rate" means, for any period, a fluctuating interest rate
per annum equal to, for each day during such period, the weighted average of
the rates on overnight Federal funds transactions with members of the Federal
Reserve System arranged by Federal funds brokers, as published on the next
succeeding Business Day by the Federal Reserve Bank of New York, or, if such
rate is not so published for any day which is a Business Day, the average of
the quotations for such day on such transactions received by the
Administrative Agent from three Federal funds brokers of recognized standing
selected by it.
"Fee Letter" means that certain Fee Letter dated November 13, 2000 among
NU, CL&P, WMECO, Barclays Bank PLC, Union Bank, Banc One Capital Markets,
Inc., Xxxxxxx Xxxxx Barney Inc. and Citibank, N.A.
"FERC" means the Federal Energy Regulatory Commission.
"Financial Statements" means, with respect to the Borrower and each
Principal Subsidiary, (i) the audited consolidated balance sheet of such
Person as at December 31, 1999, (ii) the unaudited consolidated balance sheet
of such Person as at June 30, 2000, (iii) the audited consolidated statements
of income and cash flows of such Person for the Fiscal Year ended
December 31, 1999 and (iv) the unaudited consolidated statements of income
and cash flows of such Person for the 6-month period ended June 30, 2000, in
each case as included in such Person's Annual Report on Form 10-K for the
Fiscal Year ended December 31, 1999 or Quarterly Report on Form 10-Q for the
Fiscal Quarter ended June 30, 2000.
"First Mortgage Bonds" means any bond, however designated, entitled to
the benefits of a First Mortgage Indenture.
"First Mortgage Indenture" means, with respect to CL&P, the CL&P
Indenture or any successor thereto or replacement thereof; with respect to
WMECO, the WMECO Indenture or any successor thereto or replacement thereof;
and with respect to any other Person, an indenture or similar instrument
pursuant to which such Person may issue bonds, notes or similar instruments
secured by a lien on all or substantially all of such Person's fixed assets.
"Fiscal Quarter" means a period of three calendar months ending on the
last day of March, June, September or December, as the case may be.
"Fiscal Year" means a period of twelve calendar months ending on the
last day of December.
"Fixed Charges" shall mean, for any period, the sum of the following
amounts: (a) dividends paid by NU to common and preferred stockholders during
such period; (b) interest expense for NU for such period; and (c) income
taxes paid by NU during such period.
"Fronting Bank" means Bank One, NA and any other Lender having a long-
term credit rating acceptable to the Borrower that delivers an instrument in
form and substance satisfactory to the Borrower and the Administrative Agent
whereby such other Lender agrees to act as "Fronting Bank" hereunder.
"Governmental Approval" means any authorization, consent, approval,
license, permit, certificate, exemption of, or filing or registration with,
any governmental authority or other legal or regulatory body (including,
without limitation, the Securities and Exchange Commission, the FERC, the
Nuclear Regulatory Commission, the Connecticut Department of Public Utility
Control and the Massachusetts Department of Telecommunications and Energy,
required in connection with either (i) the execution, delivery or performance
of any Loan Document, or (ii) the nature of the Borrower's or any
Subsidiary's business as conducted or the nature of the property owned or
leased by it.
"Hazardous Substance" means any waste, substance or material identified
as hazardous, dangerous or toxic by any office, agency, department,
commission, board, bureau or instrumentality of the United States of America
or of the State or locality in which the same is located having or exercising
jurisdiction over such waste, substance or material.
"HWP" means Holyoke Water Power Company, a corporation organized under
the laws of the Commonwealth of Massachusetts.
"Indemnified Person" has the meaning assigned to that term in
Section 10.04(b) hereof.
"Information Memorandum" means the confidential Information Memorandum,
dated October 2000, regarding the credit facility to be provided to the
Borrower hereunder, as distributed to the Administrative Agent and the
Lenders, including, without limitation, all schedules and attachments hereto.
"Interest Period" has the meaning assigned to that term in
Section 3.05(a) hereof.
"L/C Commitment Amount" equals $200,000,000, as the same may be reduced
permanently from time to time pursuant to Section 2.04 hereof.
"Lender Assignment" means an assignment and acceptance entered into by a
Lender and an assignee, and accepted by the Administrative Agent, in
substantially the form of Exhibit 10.07 hereto.
"Lenders" means the financial institutions listed on the signature pages
hereof, and each assignee that shall become a party hereto pursuant to
Section 10.07.
"Letter of Credit" has the meaning set forth in Section 2.02(a).
"Letter of Credit Request" has the meaning set forth in Section 2.02(d).
"Lien" means, with respect to any asset or property, any mortgage, lien,
pledge, charge, security interest or encumbrance of any kind in respect of
such asset or property. For the purposes of this Agreement, a Person or any
of its Subsidiaries shall be deemed to own subject to a Lien any asset which
it has acquired or holds subject to the interest of a vendor or lessor under
any conditional sale agreement, capital lease or other title retention
agreement relating to such asset.
"Loan Documents" means this Agreement and the Notes.
"Majority Lenders" means on any date of determination, Lenders who,
collectively, on such date (i) have Percentages in the aggregate of at least
66-2/3% and (ii) if the Commitments have been terminated, hold at least
66-2/3% of the then aggregate Outstanding Credits of the Lenders.
Determination of those Lenders satisfying the criteria specified above for
action by the Majority Lenders shall be made by the Administrative Agent and
shall be conclusive and binding on all parties absent manifest error.
"Moody's" means Xxxxx'x Investors Service, Inc., or any successor
thereto.
"NAEC" means North Atlantic Energy Corporation, a corporation organized
under the laws of the State of New Hampshire.
"Named Debt" means Debt of HWP under (i) the Reimbursement and Security
Agreement (1988 Series), dated as of November 3, 1999, as amended or extended
from time to time, between HWP and The Toronto-Dominion Bank and (ii) the
Reimbursement and Security Agreement (1990 Series), dated as of November 3,
1999, as amended or extended from time to time, between HWP and The Toronto-
Dominion Bank.
"Note" means a Contract Note, as may be amended, supplemented or
otherwise modified from time to time.
"Notice of Contract Borrowing" has the meaning assigned to that term in
Section 3.01 hereof.
"NU" has the meaning assigned to that term in the caption to this
Agreement.
"NU System Money Pool" means the money pool described in the
application/declaration, as amended, of NU and certain of its Subsidiaries,
filed with the Securities and Exchange Commission in File No. 70-8875, as
amended from time to time.
"NUSCO" means Northeast Utilities Service Company, a Connecticut
corporation.
"Operating Cash Flow" shall mean, for any period, the sum of the
following amounts: (1) dividends paid to the Borrower by a Subsidiary thereof
during such period; (2) consulting and management fees paid to the Borrower
for such period; (3) tax sharing payments made to the Borrower during such
period; (4) interest and other distributions paid to the Borrower during such
period with respect to cash (e.g., NU System Money Pool) and other Permitted
Investments of the Borrower; and (5) other cash payments made to the Borrower
by its Subsidiaries other than (A) returns of invested capital, (B) payments
of the principal on Debt of any such Subsidiary to the Borrower (to the
extent permitted hereunder) and (C) Extraordinary Proceeds. If at any time
there shall exist an event or condition which permits any holder to
accelerate the maturity date of any Debt of, or terminate its commitment to
extend credit to any Subsidiary, then the contributions of such Subsidiary to
Operating Cash Flow for any period ending at or prior to such time shall be
eliminated and Operating Cash Flow shall be calculated after giving effect to
such elimination.
"Outstanding Credits" mean, on any date of determination, an amount
equal to (i) the aggregate principal amount of all Contract Advances
outstanding on such date plus (ii) the aggregate Stated Amount of all issued
but undrawn Letters of Credit outstanding on such date plus (iii) the
aggregate amount of Reimbursement Obligations outstanding on such date
(exclusive of Reimbursement Obligations which, on such date of determination,
are repaid with the proceeds of a Contract Advance made in accordance with
Section 2.02(i)(ii), to the extent the principal amount of such Contract
Advance is included in the determination of the aggregate principal amount of
all outstanding Contract Advances as provided in clause (i) of this
definition). The "Outstanding Credits" of a Lender on any date of
determination shall be an amount equal to the outstanding Advances made by
such Lender plus the amount of such Lender's participatory interest in
outstanding Letters of Credit and Reimbursement Obligations.
"Parent Support Obligation" means, without duplication, any obligation
of the Borrower 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 (iii)
of the definition of "Debt", including any reimbursement obligation in
respect of a letter of credit, any recourse obligation in respect of a surety
or similar bond or other, similar obligation of the Borrower other than a
construction completion or similar performance guaranty as permitted
hereunder issued on behalf of HEC Inc. The amount of each Parent Support
Obligation shall be computed in good faith in accordance with the Borrower's
then applicable xxxx-to-market and other risk management methods.
"Payment Date" means the date on which payment of a Drawing is made by
the Fronting Bank.
"PBGC" means the Pension Benefit Guaranty Corporation (or any successor
entity) established under ERISA.
"Percentage" means, in respect of any Lender on any date of
determination, the percentage obtained by dividing such Lender's Commitment
on such day by the total of the Commitments on such day, and multiplying the
quotient so obtained by 100%.
"Permitted Investments" means (i) securities issued or directly and
fully guaranteed or insured by the United States or any agency or
instrumentality thereof (provided that the full faith and credit of the
United States is pledged in support thereof) having maturities of not more
than six (6) months from the date of acquisition by such Person; (ii) time
deposits and certificates of deposit, with maturities of not more than six
(6) months from the date of acquisition by such Person, of any international
commercial bank of recognized standing having capital and surplus in excess
of $500,000,000 and having a rating on its commercial paper of at least A-1
or the equivalent thereof by S&P or at least P-1 or the equivalent thereof by
Moody's; (iii) commercial paper issued by any Person, which commercial paper
is rated at least A-1 or the equivalent thereof by S&P or at least P-1 or the
equivalent thereof by Moody's and matures not more than six (6) months after
the date of acquisition by such Person; (iv) investments in money market
funds substantially all the assets of which are comprised of securities of
the types described in clauses (i) and (ii) above and (v) United States
Securities and Exchange Commission registered money market mutual funds
conforming to Rule 2a-7 of the Investment Company Act of 1940 in effect in
the United States, that invest primarily in direct obligations issued by the
United States Treasury and repurchase obligations backed by those
obligations, and rated in the highest category by S&P and Moody's.
"Person" means an individual, partnership, corporation (including a
business trust), limited liability company, joint stock company, trust,
unincorporated association, joint venture or other entity, or a government or
any political subdivision or agency thereof.
"Principal Subsidiary" shall mean CL&P, WMECO, PSNH, HWP, NAEC, Select
Energy, Inc., HEC Inc., Northeast Generation Company, Mode One
Communications, Inc., Yankee Gas Services Company, and any other Subsidiary,
whether owned directly or indirectly by the Borrower, which, with respect to
the Borrower and its Subsidiaries taken as a whole, represents at least ten
percent (10%) of such Borrower's consolidated assets or such Borrower's
consolidated net income (or loss).
"PSNH" means Public Service Company of New Hampshire, a corporation duly
organized under the laws of the State of New Hampshire.
"Recipient" has the meaning assigned to that term in Section 10.08
hereof.
"Reference Banks" means Union Bank, Barclays Bank PLC and Bank One, NA,
and any other bank or financial institution designated by the Borrower and
the Administrative Agent with the approval of the Majority Lenders to act as
a Reference Bank hereunder.
"Regulatory Asset" means, with respect to CL&P or WMECO, an intangible
asset established by statute, regulation or regulatory order or similar
action of a utility regulatory agency having jurisdiction over CL&P or WMECO,
as the case may be, and included in the rate base of CL&P or WMECO, as the
case may be, with the intention that such asset be amortized by rates over
time.
"Reimbursement Obligation" means the absolute and unconditional
obligation of the Borrower to reimburse the Fronting Bank for any Drawing
pursuant to Section 2.02(h).
"Restricted Payment" shall mean any dividend, payment or other
distribution of assets, properties, cash, rights, obligations or securities
on account of any share of any class of capital stock of NU (other than as a
result of a stock split and dividends payable solely in equity securities of
NU), or the purchase, redemption, retirement or other acquisition for value
of any shares of any class of capital stock of NU or any warrants, rights, or
options to acquire any such shares, now or hereafter outstanding.
"S&P" means Standard and Poor's Ratings Services, a division of The
XxXxxx-Xxxx Companies, Inc., or any successor thereto.
"Stated Amount" means the maximum amount available to be drawn by a
Beneficiary under a Letter of Credit.
"Stranded Cost Recovery Obligations" means, with respect to any Person,
such Person's obligations to make principal, interest or other payments to
the issuer of stranded cost recovery bonds pursuant to a loan agreement or
similar arrangement whereby the issuer has loaned the proceeds of such bonds
to such Person.
"Subsidiary" shall mean, with respect to any Person (the "Parent"), any
corporation, association or other business entity of which securities or
other ownership interests representing 50% or more of the ordinary voting
power are, at the time as of which any determination is being made, owned or
controlled by the Parent or one or more Subsidiaries of the Parent or by the
Parent and one or more Subsidiaries of the Parent.
"Termination Date" means the earliest to occur of (i) November 16, 2001,
or such later date to which the Termination Date shall be extended in
accordance with Section 2.05, (ii) the date of termination or reduction in
whole of the Commitments pursuant to Section 2.04 or 8.02 or (iii) the date
of acceleration of all amounts payable hereunder pursuant to Section 8.02.
"Total Capitalization" means, at any date, the sum of (i) the aggregate
principal amount of all long-term and short-term Debt (including the current
portion thereof) of the Borrower and its Subsidiaries, (ii) the aggregate of
the par value of, or stated capital represented by, the outstanding shares of
all classes of common and preferred shares of the Borrower and its
Subsidiaries and (iii) the consolidated surplus of the Borrower and its
Subsidiaries, paid-in, earned and other capital, if any, in each case as
determined on a consolidated basis in accordance with generally accepted
accounting principles consistent with those applied in the preparation of the
Borrower's Financial Statements.
"Total Commitment" means $400,000,000, or such lesser amount from time
to time as shall equal the sum of the Commitments.
"Type" has the meaning assigned to such term (i) in the definition of
"Contract Advance" when used in such context and (ii) in the definition of
"Contract Borrowing" when used in such context.
"Union Bank" has the meaning assigned to that term in the caption to
this Agreement.
"Unmatured Default" means the occurrence and continuance of an event
which, with the giving of notice or lapse of time or both, would constitute
an Event of Default.
"WMECO" has the meaning assigned to that term in the caption to this
Agreement.
"WMECO Indenture" has the meaning assigned to that term in
Section 7.02(a)(iii) hereof.
SECTION I.02. Computation of Time Periods. In the computation of
periods of time under this Agreement, any period of a specified number of
days or months shall be computed by including the first day or month
occurring during such period and excluding the last such day or month. In
the case of a period of time "from" a specified date "to" or "until" a later
specified date, the word "from" means "from and including" and the words "to"
and "until" each means "to but excluding".
SECTION I.03. Accounting Terms; Financial Statements. All accounting
terms not specifically defined herein shall be construed in accordance with
generally accepted accounting principles applied on a basis consistent with
the application employed in the preparation of the Financial Statements. All
references contained herein to the Borrower's or a Principal Subsidiary's
Annual Report on Form 10-K in respect of a Fiscal Year or Quarterly Report on
Form 10-Q in respect of a Fiscal Quarter shall be deemed to include any
exhibits and schedules thereto, including without limitation in the case of
any Annual Report on Form 10-K, any "Annual Report" of the Borrower or such
Principal Subsidiary referred to therein.
SECTION I.04. Computations of Outstandings. Whenever reference is made
in this Agreement to the principal amount of Outstanding Credits under this
Agreement on any date, such reference shall refer to the aggregate principal
amount of all Outstanding Credits on such date after giving effect to (i) all
Extensions of Credit to be made on such date and the application of the
proceeds thereof and (ii) any repayment or prepayment of Advances, and any
payment of Reimbursement Obligations, on such date by the Borrower.
ARTICLE II
COMMITMENTS
SECTION II.01. The Commitments
.
(a) 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 Closing Date until the
Termination Date, in an aggregate amount not to exceed on any day such
Lender's Available Commitment. Within the limits of such Lender's Available
Commitment and the Borrowing Sublimit, the Borrower may request Advances
hereunder, repay or prepay Advances and utilize the resulting increase in the
Available Commitments for further Advances in accordance with the terms
hereof.
(b) In no event shall the Borrower be entitled to request or receive
any Advance under subsection (a) that would cause the aggregate principal
amount advanced pursuant thereto to exceed the Available Commitments. In no
event shall the Borrower be entitled to request or receive any Advance that
would cause the total principal amount of all Outstanding Credits to exceed
the Total Commitment, or that would cause the aggregate principal amount of
all Advances outstanding to or requested by the Borrower to exceed the
Borrowing Sublimit.
SECTION II.02. Letters of Credit
(a) Agreement of Fronting Bank. Subject to the terms and conditions
of this Agreement, the Fronting Bank agrees to issue and amend (including,
without limitation, to extend or renew) for the account of the Borrower or
any Subsidiary thereof (each such Person, an "Account Party") one or more
standby letters of credit (individually, a "Letter of Credit" and
collectively, the "Letters of Credit") from and including the Closing Date to
the Termination Date, up to a maximum aggregate Stated Amount at any one time
outstanding equal to the L/C Commitment Amount minus Reimbursement
Obligations outstanding at such time, each having an Expiration Date on or
prior to 364 days after the Date of Issuance of such Letter of Credit;
provided, however, that the Fronting Bank will not issue or amend a Letter of
Credit if, immediately following such issuance or amendment, (i) the Stated
Amount of such Letter of Credit would (A) exceed the Available Commitments or
(B) when aggregated with (1) the Stated Amounts of all other outstanding
Letters of Credit and (2) the outstanding Reimbursement Obligations, exceed
the L/C Commitment Amount, or (ii) the total principal amount of all
Outstanding Credits would exceed the Total Commitment.
(b) Termination. The terms of each Letter of Credit shall permit
unilateral termination of such Letter of Credit by the Fronting Bank on not
more than 30 days' notice to the Beneficiary thereof or, if the Expiration
Date of such Letter of Credit is later than the Termination Date, on not more
than 20 days' notice to the Beneficiary thereof. The Fronting Bank shall not
terminate any Letter of Credit, however, except upon the occurrence and
during the continuation of an Event of Default, and then the Fronting Bank
shall terminate such Letter of Credit if directed to do so by the Majority
Lenders. Each Letter of Credit shall also provide that upon its receipt of
notice of such unilateral early termination, the Beneficiary thereof shall be
entitled to make a Drawing for the Stated Amount thereof prior to the
effective date of such early termination.
(c) Forms. Each Letter of Credit shall be in a form customarily used
by the Fronting Bank or in such other form as has been approved by the
Fronting Bank. At the time of issuance or amendment, subject to the terms
and conditions of this Agreement, the amount and the terms and conditions of
each Letter of Credit shall be subject to approval by the Fronting Bank and
the Borrower.
(d) Notice of Issuance; Application. The Borrower shall give the
Fronting Bank and the Administrative Agent written notice (or telephonic
notice confirmed in writing) at least three Business Days prior to the
requested Date of Issuance of a Letter of Credit, such notice to be in
substantially the form of Exhibit 2.02 hereto (a "Letter of Credit Request").
The Borrower shall also execute and deliver such customary letter of credit
application forms as requested from time to time by the Fronting Bank. Such
application forms shall indicate the identity of the Account Party and that
the Borrower is the "Applicant" or shall otherwise indicate that the Borrower
is the obligor in respect of any Letter of Credit to be issued thereunder.
If the terms or conditions of the application forms conflict with any
provision of this Agreement, the terms of this Agreement shall govern.
(e) Issuance. Provided the Borrower has given the notice prescribed
by Section 2.02(d) and subject to the other terms and conditions of this
Agreement, including the satisfaction of the applicable conditions precedent
set forth in Article V, the Fronting Bank shall issue the requested Letter of
Credit on the requested Date of Issuance as set forth in the applicable
Letter of Credit Request for the benefit of the stipulated Beneficiary and
shall deliver the original of such Letter of Credit to the Beneficiary at the
address specified in the notice. At the request of the Borrower, the
Fronting Bank shall deliver a copy of each Letter of Credit to the Borrower
within a reasonable time after the Date of Issuance thereof. Upon the
request of the Borrower, the Fronting Bank shall deliver to the Borrower a
copy of any Letter of Credit proposed to be issued hereunder prior to the
issuance thereof.
(f) Notice of Drawing. The Fronting Bank shall promptly notify the
Borrower by telephone, facsimile or other telecommunication of any Drawing
under a Letter of Credit.
(g) Payments. The Borrower hereby agrees to pay to the Fronting Bank,
in the manner provided in subsection (h) below:
(i) on each Payment Date, an amount equal to the amount paid by the
Fronting Bank under any Letter of Credit; and
(ii) if any Drawing shall be reimbursed to the Fronting Bank after
12:00 noon (New York time) on the Payment Date, interest on any and all
amounts required to be paid pursuant to clause (i) of this subsection (g)
from and after the due date thereof until payment in full, payable on demand,
at an annual rate of interest equal to 2.00% above the Administrative Agent's
base rate as in effect from time to time.
(h) Method of Reimbursement. The Borrower shall reimburse the
Fronting Bank for each Drawing under any Letter of Credit pursuant to
subsection (g) above in the following manner:
(i) the Borrower shall immediately reimburse the Fronting Bank in the
manner described in Section 4.01; or
(ii) if (A) the Borrower has not reimbursed the Fronting Bank pursuant
to clause (i) above, (B) the applicable conditions to the making of a
Contract Advance set forth in Articles II, III and V have been fulfilled, and
(C) the Available Commitments in effect at such time exceed the amount of the
Drawing to be reimbursed, the Borrower may reimburse the Fronting Bank for
such Drawing with the proceeds of a Base Rate Advance or, if the conditions
specified in the foregoing clauses (A), (B) and (C) have been satisfied and a
Notice of Contract Borrowing requesting a Eurodollar Rate Advance has been
given in accordance with Section 3.01 three Business Days prior to the
relevant Payment Date, with the proceeds of a Eurodollar Rate Advance.
(i) Nature of Fronting Bank's Duties. In determining whether to honor
any Drawing under any Letter of Credit, the Fronting Bank shall be
responsible only to determine that the documents and certificates required to
be delivered under that Letter of Credit have been delivered and that they
comply on their face with the requirements of that Letter of Credit. The
Borrower otherwise assumes all risks of the acts and omissions of, or misuse
of the Letters of Credit issued by the Fronting Bank by, the respective
Beneficiaries of such Letters of Credit. In furtherance and not in
limitation of the foregoing, but consistent with applicable law, the Fronting
Bank shall not be responsible (i) for the form, validity, sufficiency,
accuracy, genuineness or legal effects of any document submitted by any party
in connection with the application for and issuance of any drawing honored
under a Letter of Credit, even if it should in fact prove to be in any or all
respects invalid, insufficient, inaccurate, fraudulent or forged; (ii) for
the validity or sufficiency of any instrument transferring or assigning or
purporting to transfer or assign any such Letter of Credit, or the rights or
benefits thereunder or proceeds thereof, in whole or in part, which may prove
to be invalid or ineffective for any reason; (iii) for errors, omissions,
interruptions or delays in transmission or delivery of any messages, by mail,
cable, telegraph, telex, facsimile or otherwise, whether or not they be in
cipher; (iv) for errors in interpretation of technical terms; (v) for any
loss or delay in the transmission or otherwise of any document required in
order to make a drawing under any such Letter of Credit, or the proceeds
thereof; (vi) for the misapplication by the Beneficiary of any such Letter of
Credit or of the proceeds of any drawing honored under such Letter of Credit;
and (vii) for any consequences arising from causes beyond the control of the
Fronting Bank. None of the above shall affect, impair or prevent the vesting
of any of the Fronting Bank's rights or powers hereunder. Not in limitation
of the foregoing, any action taken or omitted to be taken by the Fronting
Bank under or in connection with any Letter of Credit shall not create
against the Fronting Bank any liability to the Borrower or any Lender, except
for actions or omissions resulting from the gross negligence or willful
misconduct of the Fronting Bank or any of its agents or representatives.
(j) Obligations of Borrower Absolute. The obligation of the Borrower
to reimburse the Fronting Bank for Drawings honored under the Letters of
Credit issued by it shall be unconditional and irrevocable and shall be paid
strictly in accordance with the terms of this Agreement under all
circumstances including, without limitation, the following circumstances:
(i) any lack of validity or enforceability of any Letter of Credit;
(ii) the existence of any claim, set-off, defense or other right which
the Borrower, any Account Party or any Affiliate of the Borrower or any
Account Party may have at any time against a Beneficiary or any transferee of
any Letter of Credit (or any Persons or entities for whom any such
Beneficiary or transferee may be acting), the Fronting Bank or any other
Person, whether in connection with this Agreement, the transactions
contemplated herein or any unrelated transaction;
(iii) any draft, demand, certificate or any other documents presented
under any Letter of Credit proving to be forged, fraudulent, invalid or
insufficient in any respect or any statement therein being untrue or
inaccurate in any respect;
(iv) the surrender or impairment of any security for the performance
or observance of any of the terms of any of the Loan Documents;
(v) any non-application or misapplication by the Beneficiary of the
proceeds of any Drawing under a Letter of Credit; or
(vi) the fact that an Unmatured Default or Event of Default shall have
occurred and be continuing.
No payment made under this Section shall be deemed to be a waiver of any
claim the Borrower may have against the Fronting Bank or any other Person.
(k) Expiration or Maturity Date of Letters of Credit. If the
Termination Date is scheduled to occur prior to the Expiration Date of any
Letter of Credit outstanding hereunder, the Borrower shall, on or prior to
the twentieth day prior to the Termination Date or, if later, the Date of
Issuance of such Letter of Credit, deposit cash in immediately available
funds in the Cash Collateral Account an amount equal to the Stated Amount of
such Letter of Credit. If a Drawing pursuant to such Letter of Credit occurs
on or prior to the Expiration Date of such Letter of Credit, the Borrower
authorizes the Administrative Agent to permit the Fronting Bank to use the
monies deposited in the Cash Collateral Account to make a payment to the
Beneficiary with respect to such Drawing. If no Drawing occurs on or prior
to the Expiration Date of such Letter of Credit, the Fronting Bank shall
instruct the Administrative Agent to (whereupon the Administrative Agent
shall) promptly return to the Borrower the monies deposited in the Cash
Collateral Account with respect to such outstanding Letter of Credit. The
Borrower hereby collaterally assigns, and grants to the Administrative Agent,
for the pro-rata benefit of the Fronting Bank or Fronting Banks and the
Lenders, a security interest in, all funds held in the Cash Collateral
Account from time to time and proceeds thereof, as security for the payment
of all amounts due and to become due from the Borrower to the Fronting Bank
under this Agreement. The Cash Collateral Account shall be in the name of
the Borrower and the Administrative Agent, for the benefit of the Fronting
Bank or Fronting Banks (as the case may be) and the Lenders, as a cash
collateral account but the Administrative Agent shall have sole dominion and
control over, and sole access to, the Cash Collateral Account. Neither the
Borrower nor any Person claiming on behalf of or through the Borrower shall
have any right to withdraw any of the funds held in the Cash Collateral
Account. The Borrower agrees that it will not (i) sell or otherwise dispose
of any interest in the Cash Collateral Account or any funds held therein, or
(ii) create or permit to exist any Lien upon or with respect to the Cash
Collateral Account or any funds held therein. The Administrative Agent shall
exercise reasonable care in the custody and preservation of any funds held in
the Cash Collateral Account and shall be deemed to have exercised such care
if such funds are accorded treatment substantially equivalent to that which
the Administrative Agent accords other funds deposited with the
Administrative Agent in like accounts, it being understood that the
Administrative Agent shall not have any responsibility for taking any
necessary steps to preserve rights against any parties with respect to any
funds held in the Cash Collateral Account.
At the direction of the Borrower, provided, that no Unmatured Default or
Event of Default shall have occurred and be continuing, the Administrative
Agent shall invest funds on deposit in the Cash Collateral Account in
certificates of deposit or other bank deposits of Union Bank at such rates
and for such periods as the Borrower and the Administrative Agent shall
agree. The Borrower shall bear all risks and costs associated with such
investments and the liquidation thereof and shall make additional deposits in
the Cash Collateral Account to the extent necessary to ensure that the
amounts on deposit therein at all times equal or exceed the amounts required
to be deposited therein pursuant to the subsection (k). Upon the later to
occur of (i) the Termination Date and (ii) the date of payment in full of all
amounts due hereunder and the expiration or termination of all Letters of
Credit, the Administrative Agent shall pay to the Borrower the proceeds of
any investments remaining in the Cash Collateral Account.
Nothing in this subsection (k) shall limit or otherwise affect the
participatory interests of the Lenders in the outstanding Letters of Credit.
(l) Participations by Lenders. By the issuance of a Letter of Credit
and without any further action on the part of the Fronting Bank or any Lender
in respect thereof, the Fronting Bank shall hereby be deemed to have granted
to each Lender, and each Lender shall hereby be deemed to have acquired from
the Fronting Bank, an undivided interest and participation in such Letter of
Credit (including any letter of credit issued by the Fronting Bank in
substitution or exchange for such Letter of Credit pursuant to the terms
thereof) equal to such Lender's Percentage of the Stated Amount of such
Letter of Credit, effective upon the issuance of such Letter of Credit. In
consideration and in furtherance of the foregoing, each Lender hereby
absolutely and unconditionally agrees to pay to the Fronting Bank, in
accordance with this subsection (l), such Lender's Percentage of each payment
made by the Fronting Bank in respect of an unreimbursed Drawing under a
Letter of Credit. The Fronting Bank shall notify the Administrative Agent of
the amount of such unreimbursed Drawing honored by it not later than
(x) 12:00 noon (New York time) on the date of payment of a draft under a
Letter of Credit, if such payment is made at or prior to 11:00 a.m. (New York
time) on such day, and (y) the close of business (New York time) on the date
of payment of a draft under a Letter of Credit, if such payment is made after
11:00 a.m. (New York time) on such day, and the Administrative Agent shall
notify each Lender of the date and amount of such unreimbursed Drawing under
such Letter of Credit honored by the Fronting Bank and the amount of such
Lender's Percentage therein no later than (1) 1:00 p.m. (New York time) on
such day, if such payment is made at or prior to 11:00 a.m. (New York time)
on such day, and (2) 11:00 a.m. (New York time) on the next following
Business Day, if such payment is made after 11:00 a.m. (New York time) on
such day. Not later than 2:00 p.m. (New York time) on the date of receipt of
a notice of an unreimbursed Drawing by a Lender, such Lender agrees to pay to
the Fronting Bank an amount equal to the product of (A) such Lender's
Percentage and (B) the amount of the payment made by the Fronting Bank in
respect of such unreimbursed Drawing.
If payment of the amount due pursuant to the preceding sentence from a
Lender is received by the Fronting Bank after the close of business on the
date it is due, such Lender agrees to pay to the Fronting Bank, in addition
to (and along with) its payment of the amount due pursuant to the preceding
sentence, interest on such amount at a rate per annum equal to (i) for the
period from and including the date such payment is due to but excluding the
second succeeding Business Day, the Federal Funds Rate, and (ii) for the
period from and including the second Business Day succeeding the date such
payment is due to but excluding the date on which such amount is paid in
full, the Federal Funds Rate plus 2.00%.
(m) Obligations of Lenders Absolute. Each Lender acknowledges and
agrees that (i) its obligation to acquire a participation in the Fronting
Bank's liability in respect of the Letters of Credit and (ii) its obligation
to make the payments specified herein, and the right of the Fronting Bank to
receive the same, in the manner specified herein, are absolute and
unconditional and shall not be affected by any circumstances whatsoever,
including, without limitation, (A) the occurrence and continuance of any
Event of Default or any Unmatured Default; (B) any other breach or default by
the Borrower, the Administrative Agent or any Lender hereunder; (C) any lack
of validity or enforceability of any Letter of Credit or this Agreement; (D)
the existence of any claim, setoff, defense or other right which the Lender
may have at any time against the Borrower, any other Account Party, any
Beneficiary, the Fronting Bank or any other Lender; (E) the existence of any
claim, setoff, defense or other right which the Borrower may have at any time
against any Beneficiary, the Fronting Bank, the Administrative Agent, any
Lender or any other Person, whether in connection with this Agreement or any
other documents contemplated hereby or any unrelated transactions; (F) any
amendment or waiver of, or consent to any departure from, all or any of the
Letters of Credit or this Agreement; (G) any statement or any document
presented under any Letter of Credit proving to be forged, fraudulent,
invalid or insufficient in any respect or any statement therein being untrue
or inaccurate in any respect; (H) payment by the Fronting Bank under any
Letter of Credit against presentation of a draft or certificate that does not
comply with the terms of such Letter of Credit, so long as such payment is
not the consequence of the Fronting Bank's gross negligence or willful
misconduct in determining whether documents presented under a Letter of
Credit comply with the terms thereof; (I) the occurrence of the Termination
Date; or (J) any other circumstance or happening whatsoever, whether or not
similar to any of the foregoing. Nothing herein shall prevent the assertion
by any Lender of a claim by separate suit or compulsory counterclaim, nor
shall any payment made by a Lender under Section 2.02 hereof be deemed to be
a waiver of any claim that a Lender may have against the Fronting Bank or any
other Person.
(n) Proceeds of Reimbursements. Upon receipt of a payment from the
Borrower pursuant to subsection (g) hereof, the Fronting Bank shall promptly
transfer to each Lender such Lender's pro rata share (determined in
accordance with such Lender's Percentage) of such payment based on such
Lender's pro rata share (determined as aforesaid) of amounts previously paid
pursuant to subsection (l), above, and not previously transferred by the
Fronting Bank pursuant to this subsection (n); provided, however, that if a
Lender shall fail to pay to the Fronting Bank any amount required by
subsection (l) above by the close of business on the Business Day following
the date on which such payment was due from such Lender, and the Borrower
shall not have reimbursed the Fronting Bank for such amount pursuant to
subsection (g) hereof (such unreimbursed amount being hereinafter referred to
as a "Transferred Amount"), the Fronting Bank shall be deemed to have
purchased, on such following Business Day (a "Participation Transfer Date")
from such Lender (a "Defaulting Lender"), a participation in such Transferred
Amount and shall be entitled, for the period from and including the
Participation Transfer Date to the earlier of (i) the date on which the
Borrower shall have reimbursed the Fronting Bank for such Transferred Amount
and (ii) the date on which such Lender shall have reimbursed the Fronting
Bank for such Transferred Amount (the "Participation Transfer Period"), to
the rights, privileges and obligations of a "Lender" under this Agreement
with respect to such Transferred Amount, and such Defaulting Lender shall not
be deemed to be a Lender hereunder, and shall not have any rights or
interests of a Lender hereunder, with respect to such Transferred Amount, and
its Percentage shall be reduced accordingly with the amount by which such
Percentage is reduced deemed held by the Fronting Bank during the
Participation Transfer Period; and provided further, however, that if, at any
time after the occurrence of a Participation Transfer Date with respect to
any Lender and prior to the reimbursement by such Lender of the Fronting Bank
with respect to the related Transferred Amount pursuant to subsection (l)
above, the Fronting Bank shall receive any payment from the Borrower pursuant
to subsection (g) hereof, the Fronting Bank shall not be obligated to pay any
amounts to such Lender, and the Fronting Bank shall retain such amounts
(including, without limitation, interest payments due from the Borrower
pursuant to subsection (g) hereof) for its own account as a Lender, provided
that all such amounts shall be applied in satisfaction of the unpaid amounts
(including, without limitation, interest payments due from such Lender
pursuant to subsection (l), above) due from such Lender with respect to such
Transferred Amount.
If at any time after the occurrence of a Participation Transfer Date
with respect to any Lender, the Administrative Agent shall receive any
payment from the Borrower for the account of such Lender pursuant to this
Agreement, if at the time of receipt of such amounts by the Administrative
Agent such Lender shall not have reimbursed the Fronting Bank with respect to
the related Transferred Amount pursuant to subsection (l) above, the
Administrative Agent shall not pay any such amounts to such Lender but shall
pay all such amounts to the Fronting Bank and the Fronting Bank shall retain
such amounts for its own account as a Lender and apply such amounts in
satisfaction of the unpaid amounts (including, without limitation, interest
payments due from such Lender pursuant to subsection (l) above) due from such
Lender with respect to such Transferred Amount.
All payments due to the Lenders from the Fronting Bank pursuant to this
subsection (n) shall be made to the Lenders if, as, and, to the extent
possible, when the Fronting Bank receives payments in respect of Drawings
under the Letters of Credit pursuant to subsection (g) hereof, and in the
same funds in which such amounts are received; provided that if any Lender to
whom the Fronting Bank is required to transfer any such payment (or any
portion thereof) pursuant to this subsection (n) does not receive such
payment (or portion thereof) prior to (i) the close of business on the
Business Day on which the Fronting Bank received such payment from the
Borrower, if the Fronting Bank received such payment prior to 1:00 p.m. (New
York time) on such day, or (ii) 1:00 p.m. (New York time) on the Business Day
next succeeding the Business Day on which the Fronting Bank received such
payment from the Borrower, if the Fronting Bank received such payment after
1:00 p.m. (New York time) on such day, the Fronting Bank agrees to pay to
such Lender, along with its payment of the portion of such payment due to
such Lender, interest on such amount at a rate per annum equal to (1) for the
period from and including the Business Day when such payment was required to
be made to the Lenders to but excluding the second succeeding Business Day,
the Federal Funds Rate and (ii) for the period from and including the second
Business Day succeeding the Business Day when such payment was required to be
made to the Lenders to but excluding the date on which such amount is paid in
full, the Federal Funds Rate plus 2.00%. The provisions of this subsection
(n) shall not affect or impair any of the obligations under this Agreement of
any Defaulting Lender to the Fronting Bank, all of which shall remain
unaffected by any default in payment by the Fronting Bank to such Defaulting
Lender.
If, in connection with any case or other proceeding seeking liquidation,
reorganization or other relief with respect to the Borrower or its debts
under any bankruptcy, insolvency or other similar law now or hereafter in
effect, or if for any other reason whatsoever, the Fronting Bank shall be
required to return to the Borrower or to a trustee, receiver, liquidator,
custodian or other similar official all or any portion of any payments to the
Lenders pursuant to this subsection (n) or interest thereon (a "Returned
Payment"), each Lender shall, upon demand of the Fronting Bank, forthwith
return to the Fronting Bank any amounts transferred to such Lender by the
Fronting Bank in respect thereof pursuant to this subsection (n) plus such
Lender's pro rata share (determined in accordance with such Lender's
Percentage) of interest (if any) that the Fronting Bank is required to pay to
such trustee, receiver, liquidator, custodian or other similar official with
respect to any Returned Payment.
(o) Concerning the Fronting Bank. The Fronting Bank will exercise and
give the same care and attention to the Letters of Credit as it gives to its
other letters of credit and similar obligations, and each Lender agrees that
the Fronting Bank's sole liability to each Lender shall be (i) to distribute
promptly, as and when received by the Fronting Bank, and in accordance with
the provisions of subsection (n) above, such Lender's pro rata share
(determined in accordance with such Lender's Percentage) of any payments to
the Fronting Bank by the Borrower pursuant to subsection (g) above in respect
of Drawings under the Letters of Credit, (ii) to exercise or refrain from
exercising any right or to take or to refrain from taking any action under
this Agreement or any Letter of Credit as may be directed in writing by the
Majority Lenders (or, when expressly required by the terms of this Agreement,
all of the Lenders) or the Administrative Agent acting at the direction and
on behalf of the Majority Lenders (or, when expressly required by the terms
of this Agreement, all of the Lenders), except to the extent required by the
terms hereof or thereof or by applicable law, and (iii) as otherwise
expressly set forth in this Section 2.02. The Fronting Bank shall not be
liable for any action taken or omitted at the request or with approval of the
Majority Lenders (or, when expressly required by the terms of this Agreement,
all of the Lenders) or of the Administrative Agent acting on behalf of the
Majority Lenders (or, when expressly required by the terms of this Agreement,
all of the Lenders) or for the nonperformance of the obligations of any other
party under this Agreement, any Letter of Credit or any other document
contemplated hereby or thereby. Without in any way limiting any of the
foregoing, the Fronting Bank may rely upon the advice of counsel concerning
legal matters and upon any written communication or any telephone
conversation that it believes to be genuine or to have been signed, sent or
made by the proper Person and shall not be required to make any inquiry
concerning the performance by the Borrower, any Beneficiary or any other
Person of any of their respective obligations and liabilities under or in
respect of this Agreement, any Letter of Credit or any other documents
contemplated hereby or thereby. The Fronting Bank shall not have any
obligation to make any claim, or assert any Lien, upon any property held by
the Fronting Bank or assert any offset thereagainst in satisfaction of all or
any part of the obligations of the Borrower hereunder; provided that the
Fronting Bank shall, if so directed by the Majority Lenders or the
Administrative Agent acting on behalf of and with the consent of the Majority
Lenders, have an obligation to make a claim, or assert a Lien, upon property
held by the Fronting Bank in connection with this Agreement, or assert an
offset thereagainst.
The Fronting Bank may accept deposits from, make loans or otherwise
extend credit to, and generally engage in any kind of banking or trust
business with the Borrower or any of its Affiliates, or any other Person, and
receive payment on such loans or extensions of credit and otherwise act with
respect thereto freely and without accountability in the same manner as if
this Agreement and the transactions contemplated hereby were not in effect.
The Fronting Bank makes no representation or warranty and shall have no
responsibility with respect to: (i) the genuineness, legality, validity,
binding effect or enforceability of this Agreement or any other documents
contemplated hereby; (ii) the truthfulness, accuracy or performance of any of
the representations, warranties or agreements contained in this Agreement or
any other documents contemplated hereby; (iii) the collectibility of any
amounts due under this Agreement; (iv) the financial condition of the
Borrower or any other Person; or (v) any act or omission of any Beneficiary
with respect to its use of any Letter of Credit or the proceeds of any
Drawing under any Letter of Credit.
(p) Indemnification of Fronting Bank by Lenders. To the extent that
the Fronting Bank is not reimbursed and indemnified by the Borrower under
Section 10.04 hereof, each Lender agrees to reimburse and indemnify the
Fronting Bank on demand, pro rata in accordance with such Lender's
Percentage, for and against any and all liabilities, obligations, losses,
damages, penalties, actions, judgments, suits, costs, expenses or
disbursements of any kind or nature whatsoever that may be imposed on,
incurred by or asserted against the Fronting Bank, in any way relating to or
arising out of this Agreement, any Letter of Credit or any other document
contemplated hereby or thereby, or any action taken or omitted by the
Fronting Bank under or in connection with this Agreement, any Letter of
Credit or any other document contemplated hereby or thereby; provided,
however, that such Lender shall not be liable for any portion of such
liabilities, obligations, losses, damages, penalties, actions, judgments,
suits, costs, expenses or disbursements resulting from the Fronting Bank's
gross negligence or willful misconduct; and provided further, however, that
such Lender shall not be liable to the Fronting Bank or any other Lender for
the failure of the Borrower to reimburse the Fronting Bank for any drawing
made under a Letter of Credit with respect to which such Lender has paid the
Fronting Bank such Lender's pro rata share (determined in accordance with
such Lender's Percentage), or for the Borrower's failure to pay interest
thereon. Each Lender's obligations under this subsection (p) shall survive
the payment in full of all amounts payable by such Lender under subsection
(l), above, and the termination of this Agreement and the Letters of Credit.
Nothing in this subsection (p) is intended to limit any Lender's
reimbursement obligation contained in subsection (l), above.
(q) Representations of Lenders. As between the Fronting Bank and the
Lenders, by its execution and delivery of this Agreement each Lender hereby
represents and warrants solely to the Fronting Bank that (i) it is duly
organized and validly existing in good standing under the laws of the
jurisdiction of its formation, and has full corporate power, authority and
legal right to execute, deliver and perform its obligations to the Fronting
Bank under this Agreement; and (ii) this Agreement constitutes its legal,
valid and binding obligation enforceable against it in accordance with the
terms hereof, except as such enforceability may be limited by applicable bank
organization, moratorium, conservatorship or other laws now or hereafter in
effect affecting the enforcement of creditors rights in general and the
rights of creditors of banks, and except as such enforceability may be
limited by general principles of equity (whether considered in a proceeding
at law or in equity).
(r) Multiple Fronting Banks. If there shall be more than one Fronting
Bank holding Outstanding Credits at any time hereunder, each such Fronting
Bank shall, with respect to the Letters of Credit issued by it and the
Reimbursement Obligations owing to it, be regarded hereunder as the "Fronting
Bank" and shall have all the rights, interests, protections and obligations
of the "Fronting Bank" hereunder with respect to such Letters of Credit and
Reimbursement Obligations and all matters relating thereto. Whenever any
action may be, or is required to be, taken by the Fronting Bank hereunder,
each Fronting Bank may, or shall, take such action only in respect of the
Letters of Credit issued by it and the Reimbursement Obligations owing to it.
Whenever the consent of the Fronting Bank is required hereunder with respect
to any proposed action, the consent of each Fronting Bank holding Outstanding
Credits shall be required for such proposed action to be taken. Any notice
to be provided to the Fronting Bank shall be provided to each Fronting Bank
holding Outstanding Credits, and each such Fronting Bank shall have the right
to request any information, and take any other action, as the Fronting Bank
is permitted to do hereunder. If at any time no Letters of Credit and no
Reimbursement Obligations are outstanding, then Bank One, NA, in its capacity
as Fronting Bank, shall have the sole right and/or obligation to take any
action or issue any consent that the Fronting Bank may, or is required to,
take or issue hereunder. The protections accorded the Fronting Bank
hereunder shall inure to the benefit of each Fronting Bank holding
Outstanding Credits from time to time hereunder, regardless of whether the
same are outstanding at the time as the benefits of such protections are
asserted.
(s) Existing Letters of Credit. The Borrower hereby acknowledges and
agrees that each of the Existing LCs shall, from and after the Closing Date,
be deemed to be a "Letter of Credit" issued under this Agreement for the
account of the Borrower, and the reimbursement obligations in respect of any
drawing made by the beneficiary with respect to any Existing LC shall, from
and after the Closing Date, constitute "Reimbursement Obligations" of the
Borrower under this Agreement, and the Outstanding Credits shall be
increased, and the Available Commitments shall be decreased, by an amount
equal to the stated amounts of the Existing LCs upon the Closing Date. Each
of the Lenders acknowledges and consents to the terms of this subsection (s).
SECTION II.03. Fees.
(a) The Borrower agrees to pay to the Administrative Agent for the
account of each Lender a commitment fee (the "Commitment Fee") on the amount
of such Lender's Available Commitment at the Applicable Commitment Fee Rate,
from the date of this Agreement, in the case of each Bank, and from the
effective date specified in the Lender Assignment pursuant to which it became
a Lender, in the case of each other Lender, until the Termination Date. The
Commitment Fee payable by the Borrower shall be calculated and accrued daily
and shall be payable quarterly in arrears on the last day of each December,
March, June and September, commencing the first such date following the
Closing Date, with final payment payable on the Termination Date.
(b) The Borrower further agrees to pay the fees specified in the Fee
Letter (including the "Fronting Fee" referred to therein) that are for its
account to the parties entitled thereto, together with such other fees as may
be separately agreed to by the Borrower and the other parties thereto or
their respective Affiliates.
(c) The Borrower shall pay to the Administrative Agent, for the account
of the Lenders, a fee in an amount equal to the then Applicable Margin for
outstanding Eurodollar Advances multiplied by the Stated Amount of each
Letter of Credit, in each case for the number of days that such Letter of
Credit is issued but undrawn, payable quarterly in arrears on the last day of
each December, March, June and September, commencing the first such date
following the Closing Date, with final payment payable on the Termination
Date.
SECTION II.04. Reduction of the Commitments. The Borrower may, at
any time, by providing at least three Business Days' prior written notice to
the Administrative Agent, terminate in whole or reduce in part the
Commitments on a pro rata basis with respect to each Lender; provided, that
any such partial reduction shall be in a minimum aggregate amount of
$5,000,000 or an integral multiple of $1,000,000 in excess thereof; provided,
further, that the Commitments may not be reduced to an amount that is less
than the aggregate Stated Amount of outstanding Letters of Credit. Subject
to the foregoing, any reduction of the Commitments by an amount in excess of
the Borrowing Sublimit shall result in a reduction of the L/C Commitment
Amount to the extent of such excess. Each such notice of termination or
reduction shall be irrevocable.
SECTION II.05. Extension of the Termination Date. Unless the
Termination Date shall have previously occurred in accordance with its terms,
at least 45 days but not more than 60 days before the Termination Date, as
then in effect, the Borrower may, by notice to the Administrative Agent (any
such notice being irrevocable), request the Administrative Agent, the
Fronting Bank and the Lenders to extend the Termination Date for a period of
364 days. If the Borrower shall make such request, the Administrative Agent
shall promptly inform the Fronting Bank and the Lenders thereof and, no later
than 30 days prior to the Termination Date as then in effect, the
Administrative Agent shall notify the Borrower in writing if the Fronting
Bank and the Lenders consent to such request and the conditions of such
consent (including conditions relating to legal documentation and evidence of
the obtaining of all necessary governmental approvals). The granting of any
such consent shall be in the sole and absolute discretion of the Fronting
Bank and each Lender, and, if the Fronting Bank or any Lender shall not so
notify the Administrative Agent or, if the Administrative Agent shall not so
notify the Borrower, such lack of notification shall be deemed to be a
determination not to consent to such request. No such extension shall occur
unless the Fronting Bank and all of the Lenders consent in writing thereto
(or, in the case of the Lenders, if less than all the Lenders consent
thereto, unless one or more other existing Lenders, or one or more other
banks and financial institutions acceptable to the Borrower and the
Administrative Agent, agree to assume all of the Commitments of the non-
consenting Lenders).
ARTICLE III
CONTRACT ADVANCES
SECTION III.01. Contract Advances. More than one Contract Borrowing
may be made on the same Business Day. Each Contract Borrowing shall consist
of Contract Advances of the same Type and Interest Period made to the
Borrower on the same Business Day by the Lenders ratably according to their
respective Commitments. Each Contract Borrowing shall be made on notice in
substantially the form of Exhibit 3.01 hereto (a "Notice of Contract
Borrowing"), delivered by the Borrower to the Administrative Agent, by hand
or facsimile, not later than 11:00 a.m. (New York City time) (i) in the case
of Eurodollar Rate Advances, on the third Business Day prior to the date of
the proposed Borrowing and (ii) in the case of Base Rate Advances, on the day
of the proposed Borrowing. Upon receipt of a Notice of Contract Borrowing,
the Administrative Agent shall notify the Lenders thereof promptly on the day
so received. Each Notice of Contract Borrowing shall specify therein:
(i) the requested (A) date of such Borrowing, (B) principal amount and Type
of Advances comprising such Borrowing and (C) initial Interest Period for
such Advances; and (ii) the aggregate amount of Outstanding Credits on such
date after giving effect to such proposed Borrowing. Each proposed Borrowing
shall be subject to the satisfaction of the conditions precedent thereto as
set forth in Article V hereof.
SECTION III.02. Terms Relating to the Making of Contract Advances
.
Notwithstanding anything in Section 3.01 above to the contrary:
(i) at no time shall more than twelve different Contract Borrowings be
outstanding hereunder;
(ii) each Contract Borrowing hereunder which is to be comprised of Base
Rate Advances shall be in an aggregate principal amount of not less than
$5,000,000 or an integral multiple of $1,000,000 in excess thereof, or such
lesser amount as shall be equal to the total amount of the Available
Commitments on such date, after giving effect to all other Contract
Borrowings to be made to, or repaid or prepaid by, the Borrower on such date;
and
(iii) each Contract Borrowing hereunder which is to be comprised of
Eurodollar Rate Advances shall be in an aggregate principal amount of not
less than $5,000,000 or an increment of $1,000,000 in excess thereof.
(a) Each Notice of Borrowing shall be irrevocable and binding on the
Borrower.
SECTION III.03. Making of Advances
.
(a) Each Lender shall, before 1:00 p.m. (New York City time) on the
date of such Borrowing, make available for the account of its Applicable
Lending Office to the Administrative Agent at the Administrative Agent's
address referred to in Section 10.02, in same day funds, such Lender's
portion of such Borrowing. Contract Advances shall be made by the Lenders
ratably in accordance with their several Commitments. After the
Administrative Agent's receipt of such funds and upon fulfillment of the
applicable conditions set forth in Article V, the Administrative Agent will
make such funds available to the Borrower at the Administrative Agent's
aforesaid address.
(b) Unless the Administrative Agent shall have received notice from a
Lender prior to the time 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 3.03, and the
Administrative Agent may, in reliance upon such assumption, make available to
the Borrower a corresponding amount on such date. If and to the extent that
any such Lender (a "non-performing Lender") shall not have so made such
ratable portion available to the Administrative Agent, the non-performing
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 comprising such Borrowing and (ii) in the case of such Lender, the
Federal Funds Rate. Nothing herein shall in any way limit, waive or
otherwise reduce any claims that any party hereto may have against any non-
performing Lender.
(c) 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.
SECTION III.04. Repayment of Advances; Contract Notes
.
(a) The Borrower shall repay the principal amount of each Advance made
to it hereunder on the Termination Date.
(b) Any Lender may request that the Contract Advances made by it be
evidenced by a Contract Note. Promptly upon receipt of such request, the
Borrower shall prepare, execute and deliver to such Lender (or, if requested
by such Lender, to such Lender and its assignees) a Contract Note.
Thereafter, the Contract Advances evidenced by such Contract Note and
interest thereon shall at all times (including after assignment pursuant to
Section 10.07) be represented by one or more Contract Notes payable to the
order of the payee named therein.
SECTION III.05. Interest
.
(a) Interest Periods.
(i) The period commencing on the date of each Advance and ending on the
last day of the period selected by the Borrower with respect to such Advance
pursuant to the provisions of this Section 3.05 is referred to herein as an
"Interest Period". The duration of each Interest Period shall be (i) in the
case of any Eurodollar Rate Advance, one, two or three months and (ii) in the
case of any Base Rate Advance, the period of time beginning on the date of
the making of, or the conversion of an outstanding Advance into, such Advance
and ending on the last day of March, June, September or December next
following the date on which such Advance was made; provided, however, that no
Interest Period may be selected by the Borrower if such Interest Period would
end after the Termination Date.
(ii) Subject to the terms and conditions of this Agreement, the initial
Interest Period for any Advance made to the Borrower shall be determined by
the Borrower as set forth in its Notice of Contract Borrowing with respect to
such Advance. The Borrower may elect to continue or convert one or more
Advances of any Type and having the same Interest Period to one or more
Advances of the same or any other Type and having the same or a different
Interest Period on the following terms and subject to the following
conditions:
(A) Each continuation or conversion shall be made as to all Advances
comprising a single Borrowing upon written notice given by the Borrower to
the Administrative Agent not later than 11:00 a.m. (New York City time) on
the third Business Day prior to the date of the proposed continuation of or
conversion, in the case of a continuation or conversion to a Eurodollar Rate
Advance, or on the day of the proposed continuation of or conversion to a
Base Rate Advance. The Administrative Agent shall notify each Lender of the
contents of such notice promptly after receipt thereof. Each such notice
shall specify therein the following information: (1) the date of such
proposed continuation or conversion (which in the case of Eurodollar Rate
Advances shall be the last day of the Interest Period then applicable to such
Advances to be continued or converted), (2) the Type of, and Interest Period
applicable to the Advances proposed to be continued or converted, (3) the
aggregate principal amount of Advances proposed to be continued or converted,
and (4) the Type of Advances to which such Advances are proposed to be
continued or converted and the Interest Period to be applicable thereto.
(B) During the continuance of an Unmatured Default, the right of the
Borrower to continue or convert Advances to Eurodollar Rate Advances shall be
suspended, and all Eurodollar Rate Advances then outstanding shall be
converted to Base Rate Advances on the last day of the Interest Period then
in effect, if, on such day, an Unmatured Default shall be continuing.
(C) During the continuance of an Event of Default, the right of the
Borrower to continue or convert Advances to Eurodollar Rate Advances shall be
suspended, and upon the occurrence of an Event of Default, all Eurodollar
Rate Advances then outstanding shall immediately, without further act by the
Borrower, be converted to Base Rate Advances.
(D) If no notice of continuation or conversion is received by the
Administrative Agent as provided in paragraph (A), above, with respect to any
outstanding Advances on or before the third Business Day prior to the last
day of the Interest Period then in effect for such Advances, the
Administrative Agent shall treat such absence of notice as a deemed notice of
continuation or conversion providing for such Advances to be continued as or
converted to Base Rate Advances with an Interest Period of three months
commencing on the last day of such Interest Period.
(b) Interest Rates. The Borrower shall pay interest on the unpaid
principal amount of each Advance owing by the Borrower from the date of such
Advance until such principal amount shall be paid in full, at the Applicable
Rate for such Advance (except as otherwise provided in this subsection (b)),
payable as follows:
(i) Eurodollar Rate Advances. If such Advance is a Eurodollar Rate
Advance, interest thereon shall be payable on the last day of the Interest
Period applicable thereto and on the Termination Date; provided that during
the continuance of any Event of Default, such Advance shall bear interest at
a rate per annum equal at all times to 2% per annum above the Applicable Rate
for such Advance for such Interest Period, or, if higher, the Applicable
Margin plus 2.0% per annum above the Applicable Rate in effect from time to
time for Base Rate Advances.
(ii) Base Rate Advances. If such Advance is a Base Rate Advance,
interest thereon shall be payable quarterly on the last day of each March,
June, September and December and on the date such Base Rate Advance shall be
paid in full; provided that during the continuance of any Event of Default,
such Advance shall bear interest at a rate per annum equal at all times to 2%
per annum above the Applicable Rate for such Advance for such Interest
Period.
(c) Other Amounts. Except as otherwise provided in Section
2.02(g)(ii), any other amounts payable hereunder that are not paid when due
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 2.0%
per annum above the Applicable Rate in effect from time to time for Base Rate
Advances, payable on demand.
(d) Interest Rate Determinations. The Administrative Agent shall give
prompt notice to the Borrower and the Lenders of the Applicable Rate
determined from time to time by the Administrative Agent for each Contract
Advance. Each Reference Bank agrees to furnish to the Administrative Agent
timely information for the purpose of determining the Eurodollar Rate for any
Interest Period. If any one Reference Bank shall not furnish such timely
information, the Administrative Agent shall determine such interest rate on
the basis of the timely information furnished by the other two Reference
Banks.
ARTICLE IV
PAYMENTS
SECTION IV.01. Payments and Computations
.
(a) The Borrower shall make each payment hereunder not later than
12:00 noon (New York City time) on the day when due in U.S. Dollars to the
Administrative Agent or, with respect to payments made in respect of
Reimbursement Obligations, the Fronting Bank, at its address referred to in
Section 10.02 hereof, in same day funds. The Administrative Agent or the
Fronting Bank, as the case may be, will promptly thereafter cause to be
distributed like funds relating to the payment of principal, interest, fees
or other amounts payable to the Lenders, to the respective Lenders to whom
the same are payable, for the account of their respective Applicable Lending
Offices, in each case to be applied in accordance with the terms of this
Agreement. Upon its acceptance of a Lender Assignment and recording of the
information contained therein in the Register pursuant to Section 10.07, from
and after the effective date specified in such Lender Assignment, the
Administrative Agent or the Fronting Bank, as the case may be, shall make all
payments hereunder in respect of the interest assigned thereby to the Lender
assignee thereunder, and the parties to such Lender Assignment shall make all
appropriate adjustments in such payments for periods prior to such effective
date directly between themselves.
(b) The Borrower hereby authorizes the Administrative Agent, the
Fronting Bank and each Lender, if and to the extent payment owed to the
Administrative, the Fronting Bank Agent or such Lender, as the case may be,
is not made when due hereunder, to charge from time to time against any or
all of the Borrower's accounts with the Administrative Agent, the Fronting
Bank or such Lender, as the case may be, any amount so due.
(c) All computations of interest based on the Base Rate (except when
determined on the basis of the Federal Funds Rate) shall be made on the basis
of a year of 365 or 366 days, as the case may be. All computations of
interest and other amounts payable pursuant to Section 4.03 shall be made by
the Lender claiming such interest or other amount on the basis of a year of
360 days. All other computations of interest, including computations of
interest based on the Eurodollar Rate, the Base Rate (when and if determined
on the basis of the Federal Funds Rate), and all computations of fees and
other amounts payable hereunder, shall be made on the basis of a year of 360
days. In each such case, such computation shall be made for the actual
number of days (including the first day but excluding the last day) occurring
in the period for which such interest, fees or other amounts are payable.
Each such determination by the Administrative Agent, the Fronting Bank or a
Lender shall be conclusive and binding for all purposes, absent manifest
error.
(d) Whenever any payment under any Loan Document shall be stated to be
due, or the last day of an Interest Period hereunder shall be stated to
occur, on a day other than a Business Day, such payment shall be made, and
the last day of such Interest Period shall occur, on the next succeeding
Business Day, and such extension of time shall in such case be included in
the computation of payment of interest and fees hereunder; provided, however,
that if such extension would cause payment of interest on or principal of
Eurodollar Rate Advances to be made, or the last day of an Interest Period
for a Eurodollar Rate Advance to occur, in the next following calendar month,
such payment shall be made on the next preceding Business Day and such
reduction of time shall in such case be included in the computation of
payment of interest hereunder.
(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 the Borrower shall not have so made such payment in full to the
Administrative Agent, such 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.
SECTION IV.02. Prepayments
.
(a) The Borrower shall not have any right to prepay any Contract
Advances except in accordance with subsections (b) and (c), below.
(b) The Borrower may, (i) in the case of Eurodollar Rate Advances, upon
at least three Business Day's written notice to the Administrative Agent
(such notice being irrevocable) and (ii) in the case of Base Rate Advances,
upon notice not later than 11:00 a.m. on the date of the proposed prepayment
to the Administrative Agent (such notice being irrevocable), stating the
proposed date and aggregate principal amount of the prepayment, and if such
notice is given, the Borrower shall, prepay Contract Advances comprising 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 and
any amounts owing in connection therewith pursuant to Section 4.03(d);
provided, however, that each partial prepayment shall be in an aggregate
principal amount not less than $5,000,000 or an integral multiple of
$1,000,000 in excess thereof.
(c) If at any time, the aggregate principal amount of Outstanding
Credits shall exceed the Total Commitment, the Borrower shall forthwith
prepay Advances and/or deposit funds in the Cash Collateral Account in a
principal amount equal to such excess. If at any time, the aggregate
principal amount of Advances outstanding to the Borrower shall exceed the
Borrowing Sublimit, the Borrower shall forthwith prepay Advances in a
principal amount equal to such excess. All prepayments pursuant to this
subsection (c) shall be effected from outstanding Contract Advances
comprising part of the same Borrowing or Borrowings and shall be accompanied
by payment of accrued interest to the date of such prepayment on the
principal amount prepaid and any amounts owing in connection therewith
pursuant to Section 4.03(d).
SECTION IV.03. Yield Protection
.
(a) Change in Circumstances. Notwithstanding any other provision
herein, if after the date hereof; the adoption of or any change in applicable
law or regulation or in the interpretation or administration thereof by any
governmental authority charged with the interpretation or administration
thereof (whether or not having the force of law) shall (i) change the basis
of taxation of payments to the Fronting Bank or any Lender of the principal
of or interest on any Eurodollar Rate Advance made by such Lender or any fees
or other amounts payable hereunder (other than changes in respect of taxes
imposed on the overall net income of the Fronting Bank or such Lender, or its
Applicable Lending Office, by the jurisdiction in which the Fronting Bank or
such Lender has its principal office or in which such Applicable Lending
Office is located or by any political subdivision or taxing authority
therein), or (ii) shall impose, modify or deem applicable any reserve,
special deposit or similar requirement against letters of credit (or
participatory interests therein) issued by, commitments or assets of,
deposits with or for the account of, or credit extended by, the Fronting Bank
or such Lender, or (iii) shall impose on the Fronting Bank or such Lender any
other condition affecting this Agreement, the Letters of Credit or
participatory interests therein or Eurodollar Rate Advances, and the result
of any of the foregoing shall be (A) to increase the cost to the Fronting
Bank or such Lender of issuing, maintaining or participating in this
Agreement or the Letter of Credit or of agreeing to make, making or
maintaining any Advance or (B) to reduce the amount of any sum received or
receivable by the Fronting Bank or such Lender hereunder (whether of
principal, interest or otherwise), then the Borrower will pay to the Fronting
Bank or such Lender, upon demand, such additional amount or amounts as will
compensate the Fronting Bank or such Lender for such additional costs
incurred or reduction suffered.
(b) Capital. If the Fronting Bank or any Lender shall have determined
that any change after the date hereof in any law, rule, regulation or
guideline adopted pursuant to or arising out of the July 1988 report of the
Basle Committee on Banking Regulations and Supervisory Practices entitled
"International Convergence of Capital Measurement and Capital Standards", or
the adoption after the date hereof of any law, rule, regulation or guideline
regarding capital adequacy, or any change in any of the foregoing or in the
interpretation or administration of any of the foregoing by any governmental
authority, central bank or comparable agency charged with the interpretation
or administration thereof, or compliance by the Fronting Bank or any Lender
(or any Applicable Lending Office of the Fronting Bank or such Lender), or
any holding company of any such entity, with any request or directive
regarding capital adequacy (whether or not having the force of law) of any
such authority, central bank or comparable agency, has or would have the
effect (i) of reducing the rate of return on such entity's capital or on the
capital of such entity's holding company, if any, as a consequence of this
Agreement, the Letters of Credit or such entity's participatory interest
therein, any Commitment hereunder or the portion of the Advances made by such
entity pursuant hereto to a level below that which such entity or such
entity's holding company could have achieved, but for such applicability,
adoption, change or compliance (taking into consideration such entity's
policies and the policies of such entity's holding company with respect to
capital adequacy), or (ii) of increasing or otherwise determining the amount
of capital required or expected to be maintained by such entity or such
entity's holding company based upon the existence of this Agreement, the
Letters of Credit or such entity's participatory interest therein, any
Commitment hereunder, the portion of the Advances made by such entity
pursuant hereto and other similar such credits, participations, commitments,
agreements or assets, then from time to time the Borrower shall pay to the
Fronting Bank or such Lender, upon demand, such additional amount or amounts
as will compensate such entity or such entity's holding company for any such
reduction or allocable capital cost suffered.
(c) Eurodollar Reserves. The Borrower shall pay to each Lender upon
demand, 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 to the Borrower, from the date of such
Advance until such principal amount is paid in full, 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 Reserve Percentage of such Lender for such Interest Period.
Such additional interest shall be determined by such Lender and notified to
the Borrower and the Administrative Agent.
(d) Breakage Indemnity. The Borrower shall indemnify each Lender
against any loss, cost or reasonable expense which such Lender may sustain or
incur as a consequence of (i) any failure by the Borrower to fulfill on the
date of any Borrowing or conversion of Advances hereunder the applicable
conditions precedent set forth in Articles III and V, (ii) any failure by the
Borrower to borrow any, or convert any outstanding Advance into a, Eurodollar
Rate Advance hereunder after a Notice of Contract Borrowing has been
delivered pursuant to Section 3.01 hereof or after delivery of a notice of
conversion pursuant to Section 3.05(a)(ii) hereof, (iii) any payment,
prepayment or conversion of a Eurodollar Rate Advance required or permitted
by any other provision of this Agreement or otherwise made or deemed made on
a date other than the last day of the Interest Period applicable thereto,
(iv) any default in payment or prepayment of the principal amount of any
Eurodollar Rate Advance made to the Borrower or any part thereof or interest
accrued thereon, as and when due and payable (at the due date thereof, by
irrevocable notice of prepayment or otherwise) or (v) the occurrence of any
Event of Default, including, in each such case, any loss or reasonable
expense sustained or incurred or to be sustained or incurred in liquidating
or employing deposits from third parties acquired to effect or maintain such
Advance or any part thereof as a Eurodollar Rate Advance. Such loss, cost or
reasonable expense shall include an amount equal to the excess, if any, as
reasonably determined by such Lender, of (A) its cost of obtaining the funds
for the Eurodollar Rate Advance being paid, prepaid, converted or not
borrowed for the period from the date of such payment, prepayment, conversion
or failure to borrow to the last day of the Interest Period for such Advance
(or, in the case of a failure to borrow, the Interest Period for such Advance
which would have commenced on the date of such failure) over (B) the amount
of interest (as reasonably determined by such Lender) that would be realized
by such Lender in reemploying the funds so paid, prepaid, converted or not
borrowed for such period or Interest Period, as the case may be. For
purposes of this subsection (d), it shall be presumed that in the case of any
Eurodollar Rate Advance, each Lender shall have funded each such Advance with
a fixed-rate instrument bearing the rates and maturities designated in the
determination of the Applicable Rate for such Advance.
(e) Notices. A certificate of the Fronting Bank or any Lender setting
forth such entity's claim for compensation hereunder and the amount necessary
to compensate such entity or its holding company pursuant to subsections (a)
through (d) of this Section 4.03 shall be submitted to the Borrower and the
Administrative Agent and shall be conclusive and binding for all purposes,
absent manifest error. The Borrower shall pay the Fronting Bank or such
Lender directly the amount shown as due on any such certificate within
10 days after its receipt of the same. The failure of any entity to provide
such notice or to make demand for payment under this Section 4.03 shall not
constitute a waiver of such entity's rights hereunder; provided that such
entity shall not be entitled to demand payment pursuant to subsections (a)
through (d) of this Section 4.03 in respect of any loss, cost, expense,
reduction or reserve, if such demand is made more than one year following the
later of such entity's incurrence or sufferance thereof or such entity's
actual knowledge of the event giving rise to such entity's rights pursuant to
such subsections. The Fronting Bank and each Lender shall use reasonable
efforts to ensure the accuracy and validity of any claim made by it
hereunder, but the foregoing shall not obligate any such entity to assert any
possible invalidity or inapplicability of the law, rule, regulation,
guideline or other change or condition which shall have occurred or been
imposed.
(f) Change in Legality. Notwithstanding any other provision herein, if
the adoption of or any change in any law or regulation or in the
interpretation or administration thereof by any governmental authority
charged with the administration or interpretation thereof shall make it
unlawful for any Lender to make or maintain any Eurodollar Rate Advance or to
give effect to its obligations as contemplated hereby with respect to any
Eurodollar Rate Advance, then, by written notice to the Borrower and the
Administrative Agent, such Lender may:
(i) declare that Eurodollar Rate Advances will not thereafter be made
by such Lender hereunder, whereupon the right of the Borrower to select
Eurodollar Rate Advances for any Borrowing or conversion shall be forthwith
suspended until such Lender shall withdraw such notice as provided
hereinbelow or shall cease to be a Lender hereunder pursuant to
Section 10.07(g) hereof; and
(ii) require that all outstanding Eurodollar Rate Advances be converted
to Base Rate Advances, in which event all Eurodollar Rate Advances shall be
automatically converted to Base Rate Advances as of the effective date of
such notice as provided herein below.
Upon receipt of any such notice, the Administrative Agent shall promptly
notify the other Lenders. Promptly upon becoming aware that the
circumstances that caused such Lender to deliver such notice no longer exist,
such Lender shall deliver notice thereof to the Borrower and the
Administrative Agent withdrawing such prior notice (but the failure to do so
shall impose no liability upon such Lender). Promptly upon receipt of such
withdrawing notice from such Lender (or upon such Lender assigning all of its
Commitments, Advances, participation and other rights and obligations under
the Loan Documents in accordance with Section 10.07(g)), the Administrative
Agent shall deliver notice thereof to the Borrower and the Lenders and such
suspension shall terminate. Prior to any Lender giving notice to the
Borrower under this subsection (f), such Lender shall use reasonable efforts
to change the jurisdiction of its Applicable Lending Office, if such change
would avoid such unlawfulness and would not, in the sole determination of
such Lender, be otherwise disadvantageous to such Lender. Any notice to the
Borrower by any Lender shall be effective as to each Eurodollar Rate Advance
on the last day of the Interest Period currently applicable to such
Eurodollar Rate Advance; provided that if such notice shall state that the
maintenance of such Advance until such last day would be unlawful, such
notice shall be effective on the date of receipt by the Borrower and the
Administrative Agent.
(g) Market Rate Disruptions. If (i) fewer than two Reference Banks
furnish timely information to the Administrative Agent for determining the
Eurodollar Rate for Eurodollar Rate Advances in connection with any proposed
Borrowing or (ii) if the Majority Lenders shall notify the Administrative
Agent that the Eurodollar Rate will not adequately reflect the cost to such
Majority Lenders of making, funding or maintaining their respective
Eurodollar Rate Advances, the right of the Borrower to select or receive
Eurodollar Rate Advances for any Borrowing shall be forthwith suspended until
the Administrative Agent shall notify the Borrower and the Lenders that the
circumstances causing such suspension no longer exist, and until such
notification from the Administrative Agent, each requested Borrowing of
Eurodollar Rate Advances hereunder shall be deemed to be a request for Base
Rate Advances.
(h) Rights of Participants. Any participant in a Lender's interests
hereunder may assert any claim for yield protection under Section 4.03 that
it could have asserted if it were a Lender hereunder. If such a claim is
asserted by any such participant, it shall be entitled to receive such
compensation from the Borrower as a Lender would receive in like
circumstances; provided, however, that with respect to any such claim, the
Borrower shall have no greater liability to the Lender and its participant,
in the aggregate, than it would have had to the Lender alone had no such
participation interest been created.
SECTION IV.04. 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, but excluding any proceeds received by
assignments or sales of participation in accordance with Section 10.07 hereof
to a Person that is not an Affiliate of the Borrower) on account of the
Advances owing to it (other than pursuant to Section 4.03 hereof) 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
participation in the Advances owing to 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 4.04 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.
Notwithstanding the foregoing, if any Lender shall obtain any such excess
payment involuntarily, such Lender may, in lieu of purchasing participation
from the other Lenders in accordance with this Section 4.04, on the date of
receipt of such excess payment, return such excess payment to the
Administrative Agent for distribution in accordance with Section 4.01(a).
SECTION IV.05. Taxes
.
(a) All payments by or on behalf of the Borrower under any Loan
Document shall be made in accordance with Section 4.01, free and clear of and
without deduction for all present or future taxes, levies, imposts,
deductions, charges or withholdings, and all liabilities with respect
thereto, excluding, in the case of each Lender, the Fronting Bank and the
Administrative Agent, taxes imposed on its overall net income, and franchise
taxes imposed on it, by the jurisdiction under the laws of which such Lender,
the Fronting Bank 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 overall net 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 under any Loan Document to any Lender,
the Fronting Bank 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 4.05) such Lender, the Fronting Bank 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 that arise from any payment made by the Borrower under any
Loan Document or from the execution, delivery or registration of, or
otherwise with respect to, any Loan Document (hereinafter referred to as
"Other Taxes").
(c) The Borrower hereby indemnifies each Lender, the Fronting Bank and
the Administrative Agent for the full amount of Taxes and Other Taxes
(including, without limitation, any Taxes and any Other Taxes imposed by any
jurisdiction on amounts payable under this Section 4.05) paid by such Lender,
the Fronting Bank or the Administrative Agent (as the case may be) and any
liability (including penalties, interest and expenses) arising therefrom or
with respect thereto, whether or not such Taxes or Other Taxes were correctly
or legally asserted. A claim for such indemnification shall be set forth in
a certificate of such Lender, the Fronting Bank or the Administrative Agent
(as the case may be) setting forth in reasonable detail the amount necessary
to indemnify such Person pursuant to this subsection (c) and shall be
submitted to the Borrower and the Administrative Agent and shall be
conclusive and binding for all purposes, absent manifest error. The Borrower
shall pay such Lender, the Fronting Bank or the Administrative Agent (as the
case may be) directly the amount shown as due on any such certificate within
30 days after the receipt of same. If any Taxes or Other Taxes for which a
Lender, the Fronting Bank or the Administrative Agent has received payments
from the Borrower hereunder shall be finally determined to have been
incorrectly or illegally asserted and are refunded to such Lender, the
Fronting Bank or the Administrative Agent, such Lender, the Fronting Bank or
the Administrative Agent, as the case may be, shall promptly forward to the
Borrower any such refunded amount. The Borrower's, the Administrative
Agent's, the Fronting Bank's and each Lender's obligations under this
Section 4.05 shall survive the payment in full of the Outstanding Credits.
(d) Within 30 days after the date of any payment of Taxes, the Borrower
will furnish to the Administrative Agent, at its address referred to in
Section 10.02, the original or a certified copy of a receipt evidencing
payment thereof.
(e) Each Lender that is not incorporated under the laws of the United
States of America or any state thereof shall, on or prior to the date it
becomes a Lender hereunder, deliver to the Borrower and the Administrative
Agent such certificates, documents or other evidence, as required by the
Internal Revenue Code of 1986, as amended from time to time (the "Code"), or
treasury regulations issued pursuant thereto, including Internal Revenue
Service Form W-8BEN or Form W-8ECI and any other certificate or statement of
exemption required by Treasury Regulation Section 1.1441-1(a) or
Section 1.1441-6(c) or any subsequent version thereof, properly completed and
duly executed by such Lender establishing that it is (i) not subject to
withholding under the Code or (ii) totally exempt from United States of
America tax under a provision of an applicable tax treaty. Each Lender shall
promptly notify the Borrower and the Administrative Agent of any change in
its Applicable Lending Office and shall deliver to the Borrower and the
Administrative Agent together with such notice such certificates, documents
or other evidence referred to in the immediately preceding sentence. Each
Lender will use good faith efforts to apprise the Borrower and the
Administrative Agent as promptly as practicable of any impending change in
its tax status that would give rise to any obligation by the Borrower to pay
any additional amounts pursuant to this Section 4.05. Unless the Borrower and
the Administrative Agent have received forms or other documents satisfactory
to them indicating that payments under the Loan Documents are not subject to
United States of America withholding tax or are subject to such tax at a rate
reduced by an applicable tax treaty, 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 of America. Each Lender represents
and warrants that each such form supplied by it to the Administrative Agent
and the Borrower pursuant to this Section 4.05, and not superseded by another
form supplied by it, is or will be, as the case may be, complete and
accurate.
(f) Any Lender claiming any additional amounts payable pursuant to this
Section 4.05 shall use reasonable efforts (consistent with legal and
regulatory restrictions) to file any certificate or document requested by the
Borrower or to change the jurisdiction of its Applicable Lending Office if
the making of such a filing or change would avoid the need for or reduce the
amount of any such additional amounts which may thereafter accrue and would
not, in the sole determination of such Lender, be otherwise disadvantageous
to such Lender.
ARTICLE V
CONDITIONS PRECEDENT
SECTION V.01. Conditions Precedent to Effectiveness. The obligations
of the Fronting Bank and the Lenders to make Extensions of Credit hereunder
shall not become effective until the date (the "Closing Date") on which each
of the following conditions is satisfied:
(a) The Administrative Agent shall have received on or before the
Closing Date the following, each dated the Closing Date, in form and
substance satisfactory to the Administrative Agent and in sufficient copies
for the Fronting Bank and each Lender:
(i) Counterparts of this Agreement, duly executed by the Borrower.
(ii) A certificate of the Secretary or Assistant Secretary of the
Borrower certifying:
(A) the names and true signatures of the officers of the Borrower
authorized to sign the Loan Documents;
(B) that attached thereto are true and correct copies of: (1) the
Declaration of Trust of the Borrower, together with all amendments thereto,
as in effect on such date; (2) the resolutions of the Borrower's Board of
Trustees approving the execution, delivery and performance by the Borrower of
the Loan Documents; (3) all documents evidencing other necessary corporate or
other similar action, if any, with respect to the execution, delivery and
performance of the Loan Documents by the Borrower; and (4) true and correct
copies of all Governmental Approvals referred to in clause (i) of the
definition of "Governmental Approval" required to be obtained by the Borrower
in connection with the execution, delivery and performance by the Borrower of
the Loan Documents (including the order of the Securities and Exchange
Commission); and
(C) that the resolutions referred to in the foregoing clause (B)(2)
have not been modified, revoked or rescinded and are in full force and effect
on such date.
(iii) A certificate signed by the Treasurer or Assistant Treasurer of
the Borrower, certifying as to:
(A) the delivery to the Fronting Bank and each of the Lenders, prior to
the Closing Date, of true, correct and complete copies (other than exhibits
thereto) of all of the Disclosure Documents; and
(B) the absence of any material adverse change in the financial
condition, operations, properties or prospects of the Borrower or the
Borrower and its Principal Subsidiaries, taken as a whole, since June 30,
2000, except as disclosed in the Disclosure Documents.
(iv) A certificate of a duly authorized officer of the Borrower stating
that (i) the representations and warranties of the Borrower contained in
Section 6.01 are correct, in all material respects, on and as of the Closing
Date before and after giving effect to any Extensions of Credit to be made on
such date and the application of the proceeds thereof, and (ii) no event has
occurred and is continuing which constitutes an Event of Default or Unmatured
Default, or would result from such initial Extensions of Credit or the
application of the proceeds thereof.
(v) Such financial, business and other information regarding the
Borrower and its Principal Subsidiaries, as the Fronting Bank or any Lender
shall have reasonably requested.
(vi) Favorable opinions of:
(A) Day, Xxxxx & Xxxxxx, counsel to the Borrower, in substantially the
form of Exhibit 5.01A hereto and as to such other matters as the Fronting
Bank or any Lender may reasonably request;
(B) Xxxxxxx X. Xxxxxx, Assistant General Counsel of NUSCO, in
substantially the form of Exhibit 5.01B hereto; and as to such other matters
as the Fronting Bank or any Lender may reasonably request; and
(C) King & Spalding, special New York counsel to the Administrative
Agent, in substantially the form of Exhibit 5.01C hereto and as to such other
matters as the Fronting Bank or any Lender may reasonably request.
(vii) Irrevocable notice to the administrative agent under the Existing
Credit Facility notifying such Person of the termination of the commitments
of the lenders thereunder, effective on or before the Closing Date.
(A) The commitments or commitment under the Existing Credit Facility
shall have been terminated and all amounts outstanding thereunder shall have
been (or will have been, upon the first Advance and the application of the
proceeds thereof on the Closing Date) paid in full.
(B) All fees and other amounts payable pursuant to Section 2.03 hereof
or pursuant to the Fee Letter shall have been paid (to the extent then due
and payable).
(C) The Administrative Agent shall have received such other approvals,
opinions and documents as the Fronting Bank or the Majority Lenders, through
the Administrative Agent, shall have reasonably requested as to the legality,
validity, binding effect or enforceability of this Agreement or the financial
condition, operations, properties or prospects of the Borrower and its
Principal Subsidiaries.
SECTION V.02. Conditions Precedent to All Extensions of Credit. The
obligation of the Fronting Bank or any Lender to make any Extension of
Credit, including the initial Extension of Credit, shall be subject to the
conditions precedent that, on the date of such Extension of Credit and after
giving effect thereto:
(a) the following statements shall be true (and each of the giving of
he applicable Notice of Contract Borrowing or Letter of Credit Request with
respect to such Extension of Credit and the acceptance of the proceeds of
such Extension of Credit by the Borrower or the acceptance of a Letter of
Credit by the Beneficiary thereof, as the case may be, shall constitute a
representation and warranty by the Borrower that on the date of such
Extension of Credit such statements are true):
(i) the representations and warranties of the Borrower contained in
Section 6.01 of this Agreement are correct, in all material respects, on and
as of the date of such Extension of Credit, before and after giving effect to
such Extension of Credit and to the application of the proceeds therefrom, as
though made on and as of such date;
(ii) no Event of Default or Unmatured Default has occurred and is
continuing on or as of the date of such Extension of Credit or would result
from such Extension of Credit or from the application of the proceeds
thereof;
(iii) the making of such Extension of Credit, when aggregated with all
other Outstanding Credits, would not cause the aggregate amount of
Outstanding Credits to exceed the Total Commitment; and
(iv) if such Extension of Credit is (A) the making of an Advance, such
Advance, when aggregated with all other Advances outstanding to or requested
by the Borrower, would not cause the Borrowing Sublimit to be exceeded, or
(B) the issuance of a Letter of Credit, the Stated Amount thereof, when
aggregated with (1) the Stated Amount of each other Letter of Credit that is
outstanding or with respect to which a Letter of Credit Request has been
received and (2) the outstanding Reimbursement Obligations, would not cause
the L/C Commitment Amount to be exceeded; and
(b) the Borrower shall have furnished to the Administrative Agent such
other approvals, opinions or documents as the Fronting Bank or any Lender may
reasonably request through the Administrative Agent as to the legality,
validity, binding effect or enforceability of any Loan Document.
SECTION V.03. Reliance on Certificates. The Fronting Bank, the Lenders
and the Administrative Agent shall be entitled to rely conclusively upon the
certificates delivered from time to time by officers of the Borrower as to
the names, incumbency, authority and signatures of the respective persons
named therein until such time as the Administrative Agent may receive a
replacement certificate, in form acceptable to the Administrative Agent, from
an officer of the Borrower identified to the Administrative Agent as having
authority to deliver such certificate, setting forth the names and true
signatures of the officers and other representatives of the Borrower
thereafter authorized to act on behalf of the Borrower and, in all cases, the
Fronting Bank, the Lenders and the Administrative Agent may rely on the
information set forth in any such certificate.
ARTICLE VI
REPRESENTATIONS AND WARRANTIES
SECTION VI.01. Representations and Warranties of the Borrower. The
Borrower represents and warrants as follows:
(a) The Borrower is a voluntary association organized under a
Declaration of Trust, and each of its Principal Subsidiaries is a
corporation, in each case duly organized, validly existing and in good
standing under the laws of the jurisdiction of its organization, has the
requisite corporate power (or in the case of the Borrower, power under its
Declaration of Trust) and authority to own its property and assets and to
carry on its business as now conducted and is qualified to do business in
every jurisdiction where, because of the nature of its business or property,
such qualification is required, except where the failure so to qualify would
not have a material adverse effect on the financial condition, properties,
prospects or operations of the Borrower or of the Borrower and its Principal
Subsidiaries taken as a whole. The Borrower has the requisite power to
execute, deliver and perform its obligations under the Loan Documents and to
borrow hereunder.
(b) The execution, delivery and performance of the Loan Documents by
the Borrower are within the Borrower's powers under its Declaration or Trust,
have been duly authorized by all necessary action under its Declaration of
Trust and applicable law, and do not and will not contravene (i) the
Borrower's Declaration of Trust or any law or legal restriction or (ii) any
contractual restriction binding on or affecting the Borrower or its
properties or its Principal Subsidiaries or their respective properties.
(c) Except as disclosed in the Disclosure Documents, none of the
Borrower or any of its Principal Subsidiaries is in violation of any law or
in default with respect to any judgment, writ, injunction, decree, rule or
regulation (including any of the foregoing relating to environmental laws and
regulations) of any court or governmental agency or instrumentality where
such violation or default would reasonably be expected to have a material
adverse effect on the financial condition, properties, prospects or
operations of the Borrower or of the Borrower and its Principal Subsidiaries,
taken as a whole.
(d) There has been no material adverse development with respect to (i)
the proceedings of CL&P or WMECO to divest its generating assets, (ii) any
orders, plans or authorizations for recovery of the stranded assets of CL&P
or WMECO, or (iii) the September 8, 2000 PSNH restructuring settlement (PUC
order no. 23,549), where any such development results, or would reasonably be
expected to result, in a material adverse effect on the financial condition,
properties, prospects or operations of the Borrower or of the Borrower and
its Principal Subsidiaries, taken as a whole, other than as described in the
Disclosure Documents.
(e) All Governmental Approvals referred to in clause (i) of the
definition of "Governmental Approvals" have been duly obtained or made, and
all applicable periods of time for review, rehearing or appeal with respect
thereto have expired, except as described below. If the period for appeal of
the order of the Securities and Exchange Commission approving the
transactions contemplated hereby has not expired, the filing of an appeal of
such order will not affect the validity of said transactions, unless such
order has been otherwise stayed or any of the parties hereto has actual
knowledge that any of such transactions constitutes a violation of the Public
Utility Holding Company Act of 1935 or any rule or regulation thereunder. No
such stay exists and the Borrower has no reason to believe that any of such
transactions constitutes any such violation. The Borrower and each
Subsidiary thereof has obtained or made all Governmental Approvals referred
to in clause (ii) of the definition of "Governmental Approvals", except
(A) those which are not yet required but which are obtainable in the ordinary
course of business as and when required, (B) those the absence of which would
not materially adversely affect the financial condition, properties,
prospects or operations of the Borrower or of the Borrower and its Principal
Subsidiaries, taken as a whole, and (C) those which the Borrower or any such
Subsidiary, as the case may be, is diligently attempting in good faith to
obtain, renew or extend, or the requirement for which the Borrower or any
such Subsidiary, as the case may be, is contesting in good faith by
appropriate proceedings or by other appropriate means, in each case described
in the foregoing clause (C), except as is disclosed in the Disclosure
Documents, such attempt or contest, and any delay resulting therefrom, is not
reasonably expected to have a material adverse effect on the financial
condition, properties, prospects or operations of the Borrower or of the
Borrower and its Principal Subsidiaries, taken as a whole, or to magnify to
any significant degree any such material adverse effect that would reasonably
be expected to result from the absence of such Governmental Approval.
(f) The Loan Documents are legal, valid and binding obligations of the
Borrower enforceable against the Borrower in accordance with their respective
terms; subject to the qualification, however, that the enforcement of the
rights and remedies herein and therein is subject to bankruptcy and other
similar laws of general application affecting rights and remedies of
creditors and the application of general principles of equity (regardless of
whether considered in a proceeding in equity or at law).
(g) The Financial Statements, copies of which have been provided to the
Administrative Agent, the Fronting Bank and each of the Lenders, fairly
present in all material respects the consolidated financial condition and
results of operations of the Borrower and each of its Principal Subsidiaries
at and for the period ended on the dates thereof, and have been prepared in
accordance with generally accepted accounting principles consistently
applied. Since June 30, 2000, there has been no material adverse change in
the consolidated financial condition, operations, properties or prospects of
the Borrower or of the Borrower and its Principal Subsidiaries, taken as a
whole, except as disclosed in the Disclosure Documents.
(h) There is no pending or known threatened action or proceeding
(including, without limitation, any action or proceeding relating to any
environmental protection laws or regulations) affecting the Borrower, any
Principal Subsidiary thereof or any of their respective properties, before
any court, governmental agency or arbitrator (i) which affects or purports to
affect the legality, validity or enforceability of any Loan Document or
(ii) as to which there is a reasonable possibility of an adverse
determination and which, if adversely determined, would materially adversely
affect the financial condition, properties, prospects or operations of the
Borrower or of the Borrower and its Principal Subsidiaries, taken as a whole,
except, for purposes of this clause (ii) only, such as is described in the
Disclosure Documents or in Schedule II hereto.
(i) No ERISA Plan Termination Event has occurred nor is reasonably
expected to occur with respect to any ERISA Plan which would materially
adversely affect the financial condition, properties, prospects or operations
of the Borrower or of the Borrower and its Principal Subsidiaries, taken as a
whole, except as disclosed to the Lenders and consented to by the Majority
Lenders in writing. Since the date of the most recent Schedule B (Actuarial
Information) to the annual report of each such ERISA Plan (Form 5500 Series),
there has been no material adverse change in the funding status of the ERISA
Plans referred to therein, and no "prohibited transaction" (as defined in
Section 4975 of the Internal Revenue Code of 1986, as amended, and in ERISA)
has occurred with respect thereto that, singly or in the aggregate with all
other "prohibited transactions" and after giving effect to all likely
consequences thereof, would be reasonably expected to have a material adverse
effect on the financial condition, properties, prospects or operations of the
Borrower or of the Borrower and its Principal Subsidiaries, taken as a whole.
Neither the Borrower nor any of its ERISA Affiliates has incurred nor
reasonably expects to incur any material withdrawal liability under ERISA to
any ERISA Multiemployer Plan, except as disclosed to and consented by the
Majority Lenders in writing.
(j) The Borrower and each Principal Subsidiary thereof has good and
marketable title (or, in the case of personal property, valid title) or valid
leasehold interests in its assets, except for (i) minor defects in title that
do not materially interfere with the ability of the Borrower or such
Principal Subsidiary to conduct its business as now conducted and (ii) other
defects that, either individually or in the aggregate, do not materially
adversely affect the financial condition, properties, prospects or operations
of the Borrower or of the Borrower and its Principal Subsidiaries, taken as a
whole. All such assets and properties are free and clear of any Lien, other
than Liens permitted under Section 7.02(a) hereof. No Liens exist on the
stock of CL&P, WMECO or PSNH.
(k) All outstanding shares of capital stock having ordinary voting
power for the election of directors of each Principal Subsidiary have been
validly issued and are fully paid and nonassessable and are owned
beneficially by NU, free and clear of any Lien. NU is a "holding company"
(as defined in the Public Utility Holding Company Act of 1935, as amended).
(l) The Borrower and each of its Principal Subsidiaries has filed all
tax returns (Federal, state and local) required to be filed and paid taxes
shown thereon to be due, including interest and penalties, or, to the extent
the Borrower or such Principal Subsidiary is contesting in good faith an
assertion of liability based on such returns, has provided adequate reserves
in accordance with generally accepted accounting principles for payment
thereof.
(m) No exhibit, schedule, report or other written information provided
by or on behalf of the Borrower or its agents to the Administrative Agent,
the Fronting Bank or the Lenders in connection with the negotiation,
execution and closing of the Loan Documents (including, without limitation,
the Financial Statements and the Information Memorandum (but excluding the
projections contained in the Information Memorandum)) knowingly contained
when made any material misstatement of fact or knowingly omitted to state any
material fact necessary to make the statements contained therein not
misleading in light of the circumstances under which they were made. Except
as has been disclosed to the Administrative Agent, the Fronting Bank and each
Lender, the projections delivered concurrently with the Information
Memorandum were prepared in good faith on the basis of assumptions reasonable
as of the date of the Information Memorandum, it being understood that such
projections do not constitute a warranty or binding assurance of future
performance. Except as has been disclosed to the Administrative Agent, the
Fronting Bank and each Lender, nothing has come to the attention of the
responsible officers of the Borrower that would indicate that any of such
assumptions, to the extent material to such projections, has ceased to be
reasonable in light of subsequent developments or events.
(n) All proceeds of the Advances shall be used (i) for the general
corporate purposes of the Borrower, including to provide liquidity support
for the Borrower's commercial paper, and (ii) to provide liquidity to the NU
System Money Pool. The Letters of Credit shall be used for the general
corporate purposes of the Borrower and its Subsidiaries. No proceeds of any
Advance will be used in violation of, or in any manner that would result in a
violation by any party hereto of, Regulation T, U or X promulgated by the
Board of Governors of the Federal Reserve System or any successor
regulations. Neither the Borrower nor any Subsidiary thereof (A) is an
"investment company" within the meaning ascribed to that term in the
Investment Company Act of 1940 and (B) is engaged in the business of
extending credit for the purpose of buying or carrying margin stock.
(o) The Borrower and each Principal Subsidiary thereof has obtained the
insurance specified in Section 7.01(c) hereof and the same is in full force
and effect.
ARTICLE VII
COVENANTS
SECTION VII.01. Affirmative Covenants. On and after the Closing Date,
so long as any obligation hereunder shall remain unpaid or any Lender shall
have any Commitment hereunder, the Borrower shall, unless the Majority
Lenders shall otherwise consent in writing:
(a) Use of Proceeds. Apply the proceeds of each Advance, and use, and
cause its Subsidiaries to use, the Letters of Credit, solely as specified in
Section 6.01(n) hereof.
(b) Payment of Taxes, Etc. Pay and discharge, and cause each of its
Principal Subsidiaries to pay and discharge, before the same shall become
delinquent, all taxes, assessments and governmental charges, royalties or
levies imposed upon it or upon its property except to the extent the Borrower
or such Principal Subsidiary is contesting the same in good faith by
appropriate proceedings and has set aside adequate reserves in accordance
with generally accepted accounting principles for the payment thereof.
(c) Maintenance of Insurance. Maintain or cause to be maintained, and
cause each of its Principal Subsidiaries to maintain or cause to be
maintained, insurance (including appropriate plans of self-insurance)
covering the Borrower, the Principal Subsidiaries and their respective
properties, in effect at all times in such amounts and covering such risks as
may be required by law and, in addition, as is usually carried by companies
engaged in similar businesses and owning similar properties as the Borrower
and such Principal Subsidiaries.
(d) Preservation of Existence, Etc.; Disaggregation.
(i) Except as permitted by Section 7.02(b) hereof, preserve and
maintain, and cause each of its Principal Subsidiaries to preserve and
maintain, its existence, corporate or otherwise, material rights (statutory
and otherwise) and franchises except where the failure to maintain and
preserve such rights and franchises would not materially adversely affect the
financial condition, properties, prospects or operations of the Borrower or
of the Borrower and its Principal Subsidiaries, taken as a whole.
(ii) In furtherance of the foregoing, and notwithstanding Section
7.02(b), the Borrower agrees that it will not, and will cause each of its
Principal Subsidiaries not to, except in accordance with one or more
restructuring plans approved by the appropriate regulatory authorities, sell,
transfer or otherwise dispose of (by lease or otherwise, and whether in one
or a series of related transactions) any portion of its generation,
transmission or distribution assets in excess of 10% of the net utility plant
assets of the Borrower and its Principal Subsidiaries, taken as a whole, in
each case as determined on a cumulative basis from the date of this Agreement
through the Termination Date by reference to the published balance sheets of
the Borrower and its Principal Subsidiaries.
(e) Compliance with Laws, Etc. Comply, and cause each of its Principal
Subsidiaries to comply, in all material respects with the requirements of all
applicable laws, rules, regulations and orders of any governmental authority,
including, without limitation, any such laws, rules, regulations and orders
issued by the Securities and Exchange Commission or relating to zoning,
environmental protection, use and disposal of Hazardous Substances, land use,
construction and building restrictions, ERISA and employee safety and health
matters relating to business operations, except to the extent (i) that the
Borrower or any such Principal Subsidiary is contesting the same in good
faith by appropriate proceedings or (ii) that any such non-compliance, and
the enforcement or correction thereof, would not materially adversely affect
the financial condition, properties, prospects or operations of the Borrower
or of the Borrower and its Principal Subsidiaries, taken as a whole.
(f) Inspection Rights. At any time and from time to time upon
reasonable notice, permit, and cause each of its Principal Subsidiaries to
permit, the Administrative Agent and its agents and representatives to
examine and make copies of and abstracts from the records and books of
account of, and the properties of, the Borrower and each Principal Subsidiary
and to discuss the affairs, finances and accounts of the Borrower and each
Principal Subsidiary (i) with the Borrower, each Principal Subsidiary and
their respective officers and directors and (ii) with the consent of the
Borrower and/or its Principal Subsidiaries, as the case may be (which consent
shall not be unreasonably withheld or delayed), with the accountants of the
Borrower or any such Principal Subsidiary.
(g) Keeping of Books. Keep, and cause each Principal Subsidiary to
keep, proper records and books of account, in which full and correct entries
shall be made of all financial transactions of the Borrower and each
Principal Subsidiary and the assets and business of the Borrower and each
Principal Subsidiary, in accordance with generally accepted accounting
practices consistently applied.
(h) Conduct of Business. Except as permitted by Section 7.02(b) but
subject in all respects to Section 7.01(d)(ii), conduct, and cause each
Principal Subsidiary to conduct, its primary business in substantially the
same manner and in substantially the same fields as such business is
conducted on the Closing Date.
(i) Maintenance of Properties, Etc. (i) As to properties of the type
described in Section 6.01(j) hereof, maintain, and cause each Principal
Subsidiary to maintain, title of the quality described therein and preserve,
maintain, develop, and operate, and cause each Principal Subsidiary to
preserve, maintain, develop and operate, in substantial conformity with all
laws, material contractual obligations and prudent practices prevailing in
the industry, all of its properties which are used or useful in the conduct
of its businesses in good working order and condition, ordinary wear and tear
excepted, except (A) as permitted by Section 7.02(b), but subject
nevertheless to Section 7.01(d)(ii), (B) as disclosed in the Disclosure
Documents or otherwise in writing to the Administrative Agent, the Fronting
Bank and the Lenders on or prior to the date hereof, and (C) to the extent
such non-conformity would not materially adversely affect the financial
condition, properties, prospects or operations of the Borrower or of the
Borrower and its Principal Subsidiaries, taken as a whole; provided, however,
that neither the Borrower nor any Principal Subsidiary will be prevented from
discontinuing the operation and maintenance of any such properties if such
discontinuance is, in the judgment of the Borrower or such Principal
Subsidiary, desirable in the operation or maintenance of its business and
would not materially adversely affect the financial condition, properties,
prospects or operations of the Borrower or of the Borrower and its Principal
Subsidiaries, taken as a whole.
(j) Governmental Approvals. Duly obtain, and cause each Principal
Subsidiary to duly obtain, on or prior to such date as the same may become
legally required, and thereafter maintain, and cause each Principal
Subsidiary to maintain, in effect at all times, all Governmental Approvals on
its part to be obtained, except in the case of those Governmental Approvals
referred to in clause (ii) of the definition of "Governmental Approvals",
(i) those the absence of which would not materially adversely affect the
financial condition, properties, prospects or operations of the Borrower or
of the Borrower and its Principal Subsidiaries, taken as a whole, and
(ii) those which the Borrower or such Principal Subsidiary is diligently
attempting in good faith to obtain, renew or extend, or the requirement for
which the Borrower or such Principal Subsidiary is contesting in good faith
by appropriate proceedings or by other appropriate means; provided, however,
that the exception afforded by clause (ii), above, shall be available only if
and for so long as such attempt or contest, and any delay resulting
therefrom, does not have a material adverse effect on the financial
condition, properties, prospects or operations of the Borrower or of the
Borrower and its Principal Subsidiaries, taken as a whole, and does not
magnify to any significant degree any such material adverse effect that would
reasonably be expected to result from the absence of such Governmental
Approval.
(k) Further Assurances. Promptly execute and deliver all further
instruments and documents, and take all further action, that may be necessary
or that any Lender or the Fronting Bank through the Administrative Agent may
reasonably request in order to fully give effect to the interests and
properties purported to be covered by the Loan Documents.
SECTION VII.02. Negative Covenants. On and after the Closing Date,
and so long as any obligation hereunder shall remain unpaid or any Lender
shall have any Commitment hereunder, the Borrower shall not, or permit any
Principal Subsidiary to, without the written consent of the Majority Lenders:
(a) Liens, Etc. Create incur, assume or suffer to exist any Lien upon
any of its properties or assets (including the stock of its Subsidiaries),
whether now owned or hereafter acquired, except:
(i) any Liens existing on the Closing Date;
(ii) in the case of CL&P, Liens created by the Indenture of Mortgage
and Deed of Trust dated as of May 1, 1921, from CL&P to Bankers Trust
Company, as trustee, as previously and hereafter amended and supplemented
(the "CL&P Indenture");
(iii) in the case of WMECO, Liens created by the First Mortgage
Indenture and Deed of Trust dated as of August 1, 1954, from WMECO to State
Street Bank and Trust Company, as successor trustee, as previously and
hereafter amended and supplemented (the "WMECO Indenture");
(iv) in the case of PSNH, Liens created by the General and Refunding
Mortgage Indenture, dated as of August 15, 1978, between PSNH and New England
Merchants National Bank, as trustee, and to which First Union National Bank
is successor trustee, as previously and hereafter amended and supplemented
(the "PSNH Indenture");
(v) in the case of NAEC, Liens created by the First Mortgage Indenture
and Deed of Trust, dated as of June 1, 0000, xxxxxxx XXXX xxx Xxxxxx Xxxxxx
Trust Company of New York, as trustee, as previously and hereafter amended
and supplemented (the "NAEC Indenture");
(vi) as permitted by Section 7.02(f) hereof;
(vii) Liens on the interests of CL&P and WMECO in (A) the Millstone Unit
No. 1 created by (1) the Open-End Mortgage and Trust Agreement dated as of
October 1, 1986, as previously and hereafter amended, made by CL&P in favor
of State Street Bank and Trust Company, as successor trustee, and (2) the
Open-End Mortgage and Trust Agreement dated as of October 1, 1986, as
previously and hereafter amended, made by WMECO in favor of State Street Bank
and Trust Company, as successor trustee, to the extent of the Debt from time
to time secured by such Open-End Mortgages and Trust Agreements, and (B)
Millstone Xxxx Xx. 0 xxx Xxxxxxxxx Xxxx Xx. 0 created by (1) the Open-End
Mortgage, dated as of November 17, 2000, made by CL&P in favor of Citibank,
N.A., as collateral agent, and (2) the Open-End Mortgage, dated as of
November 17, 2000, made by WMECO in favor of Citibank, N.A., as collateral
agent, to the extent of the Debt secured by such Open-End Mortgages;
(viii) "Permitted Liens" or "Permitted Encumbrances" under the CL&P
Indenture (in the case of CL&P), the WMECO Indenture (in the case of WMECO),
the PSNH Indenture (in the case of PSNH) or the NAEC Indenture (in the case
of NAEC), in each case as such terms are defined on the date hereof, to the
extent such Liens do not secure Debt of the Borrower or any Principal
Subsidiary;
(ix) any purchase money Lien or construction mortgage on assets
hereafter acquired or constructed by the Borrower or any Principal Subsidiary
and any Lien on any assets existing at the time of acquisition thereof by the
Borrower or such Principal Subsidiary or created within 180 days from the
date of completion of such acquisition or construction; provided that such
Lien shall at all times be confined solely to the assets so acquired or
constructed and any additions thereto;
(x) any existing Liens on assets now owned by the Borrower or any
Principal Subsidiary and Liens existing on assets of a corporation or other
going concern when it is merged into or with the Borrower or such Principal
Subsidiary or when substantially all of its assets are acquired by the
Borrower or such Principal Subsidiary; provided that such Liens shall at all
times be confined solely to such assets, or if such assets constitute a
utility system, additions to or substitutions for such assets;
(xi) Liens resulting from legal proceedings being contested in good
faith by appropriate legal or administrative proceedings by the Borrower or
any Principal Subsidiary, and as to which the Borrower or such Principal
Subsidiary, to the extent required by generally accepted accounting
principles applied on a consistent basis, shall have set aside on its books
adequate reserves;
(xii) Liens created in favor of the other contracting party in connection
with advance or progress payments;
(xiii) any Liens in favor of any state of the United States or any
political subdivision of any such state, or any agency of any such state or
political subdivisions, or trustee acting on behalf of holders of obligations
issued by any of the foregoing or any financial institutions lending to or
purchasing obligations of any of the foregoing, which Lien is created or
assumed for the purpose of financing all or part of the cost of acquiring or
constructing the property subject thereto;
(xiv) Liens resulting from conditional sale agreements, capital leases
or other title retention agreements including, without limitation, Liens
arising under leases of nuclear fuel from the Niantic Bay Fuel Trust;
(xv) with respect to pollution control bond financings, Liens on
funds, accounts and other similar intangibles of the Borrower or any
Principal Subsidiary created or arising under the relevant indenture, pledges
of the related loan agreement with the relevant issuing authority and pledges
of the Borrower's or such Principal Subsidiary's interest, if any, in any
bonds issued pursuant to such financings to a letter of credit bank or bond
issuer or similar credit enhancer;
(xvi) Liens granted on accounts receivable and Regulatory Assets in
connection with financing transactions, whether denominated as sales or
borrowings;
(xvii) Liens on the assets of, or the stock issued by, Northeast
Generation Company or any other Subsidiary of the Borrower created to hold
generating assets if such Liens are created to secure nonrecourse Debt
incurred to acquire, construct or otherwise develop such generating assets;
(xviii) Liens on assets of HWP permitted to exist by the terms of
agreements governing the Named Debt;
(xix) any other Liens incurred in the ordinary course of business
otherwise than to secure Debt; and
(xx) any extension, renewal or replacement of Liens permitted by
clauses (i), (vii) through (x) and (xii) through (xvii); provided, however,
that the principal amount of Debt secured thereby shall not, at the time of
such extension, renewal or replacement, exceed the principal amount of Debt
so secured and that such extension, renewal or replacement shall be limited
to all or a part of the property which secured the Lien so extended, renewed
or replaced or to other property of no greater value than the property which
secured the Lien so extended, renewed or replaced.
(b) Mergers, Acquisitions, Sales of Assets, Etc. Merge with or into or
consolidate with or into, any Person, or purchase or otherwise acquire
(whether directly or indirectly) all or substantially all of the assets or
stock of any class of, or any partnership or joint venture interest in, any
other Person, or sell, transfer, convey, lease or otherwise dispose of all or
any substantial part of its assets; except for the following, and then only
after receipt of all necessary corporate and governmental or regulatory
approvals and provided that, before and after giving effect to any such
merger, consolidation, purchase, acquisition, sale, transfer, conveyance,
lease or other disposition, no Event of Default or Unmatured Default shall
have occurred and be continuing:
(A) NU may merge with or into Consolidated Edison, Inc. or a wholly
owned Subsidiary thereof;
(B) NU or any Subsidiary thereof may enter into such transactions with
third parties if the aggregate consideration involved in all such
transactions does not exceed $25,000,000 and if NU or such Subsidiary is the
surviving legal entity of any such transaction;
(C) any purchase or acquisition of a joint venture interest in a mutual
insurance company providing nuclear liability or nuclear property or
replacement power insurance;
(D) any sale of accounts receivable on reasonable commercial terms
(including a commercially reasonable discount) to obtain funding for CL&P and
WMECO, as the case may be;
(E) any sale or purchase of generating assets or Regulatory Assets on
an arms-length basis, subject to approval by the appropriate regulatory
authorities;
(F) any sale of transmission assets on an arms-length basis as required
by the appropriate regulatory authorities; and
(G) the sale of the Borrower's or any Principal Subsidiary's assets in
the ordinary course of business on customary terms and conditions.
For purposes of this subsection (b), any sale of assets by the Borrower or
any Principal Subsidiary (in one or a series of transactions) will be deemed
to be a "substantial part" of its assets if (i) the book value of such assets
exceeds 7.5% of the total book value of the assets (net of Regulatory Assets)
of such Person, as reflected in the most recent financial statements of the
Borrower or such Principal Subsidiary delivered to the Administrative Agent
pursuant to Section 7.04 hereof (or, if no such financial statements have
been delivered to the Administrative Agent as of the relevant date of
determination, the Financial Statements of such Person), or (ii) the gross
revenue associated with such assets accounts for more than 7.5% of the total
gross revenue of the Borrower or such Principal Subsidiary for the four
proceeding fiscal quarters, as reflected in the most recent financial
statements of the Borrower or such Principal Subsidiary delivered to the
Administrative Agent pursuant to Section 7.04 hereof (or, if no such
financial statements have been delivered to the Administrative Agent as of
the relevant date of determination, the Financial Statements of such Person).
(c) Compliance with ERISA. (i) Terminate, or permit any of its ERISA
Affiliates to terminate, any ERISA Plan so as to result in any liability of
the Borrower or any Principal Subsidiary to the PBGC in an amount greater
than $1,000,000, or (ii) permit to exist any occurrence of any Reportable
Event (as defined in Title IV of ERISA) which, alone or together with any
other Reportable Event with respect to the same or another ERISA Plan, has a
reasonable possibility of resulting in liability of the Borrower or any
Principal Subsidiary to the PBGC in an aggregate amount exceeding $1,000,000,
or any other event or condition which presents a material risk of such a
termination by the PBGC of any ERISA Plan or has a reasonable possibility of
resulting in a liability of the Borrower or any Principal Subsidiary to the
PBGC in an aggregate amount exceeding $1,000,000.
(d) Accounting Changes. Make any change in its accounting policies or
reporting practices except as required or permitted by the Securities and
Exchange Commission, the Financial Accounting Standards Board or any other
generally recognized accounting authority.
(e) ransactions with Affiliates. Engage in any transaction with any
Affiliate except (i) in accordance with the Public Utility Holding Company
Act of 1935, to the extent applicable thereto or (ii) on terms no less
favorable to the Borrower or the Principal Subsidiary party thereto than if
the transaction had been negotiated in good faith on an arms-length basis
with a non-Affiliate and on commercially reasonable terms or pursuant to a
binding agreement in effect on the Closing Date.
(f) Issuance of First Mortgage Bonds. In the case of Principal
Subsidiaries only, issue any First Mortgage Bonds on or after the Closing
Date, whether in addition to First Mortgage Bonds outstanding on the Closing
Date or in replacement of First Mortgage Bonds redeemed, retired, defeased,
repaid or prepaid on or after the Closing Date; provided, that (i) Yankee Gas
Services Company may issue First Mortgage Bonds, the proceeds of which are
used to refinance not more than $200,000,000 of Debt incurred by NU in
connection with the acquisition by NU of Yankee Energy System Inc., and
(ii) Northeast Generation Company may issue First Mortgage Bonds for the
purpose of refinancing up to $416,000,000 of its secured Debt outstanding on
the Closing Date, to the extent that the principal amount of any such First
Mortgage Bonds is less than or equal to the principal amount of the Debt so
refinanced plus up to six months of accrued interest on such Debt, determined
at the time of the refinancing; provided, that in no event shall the amount
of First Mortgage Bonds issued by Northeast Generation Company exceed
$440,000,000.
(g) Interests in Nuclear Plants. Acquire any nuclear plant or any
interest therein not held on the Closing Date, other than so-called "power
entitlements" acquired for use in the ordinary course of business.
(h) Debt. Create, incur, assume or suffer to exist, any Debt of NU, NU
Enterprises, Inc. or any Subsidiary of NU Enterprises, Inc., other than
(i) Debt under the Loan Documents; (ii) other Debt in existence on the
Closing Date, and any renewal or replacement thereof by the debtor thereunder
so long as such renewal or replacement does not result in an increase in the
amount of such Debt or require, when compared to the Debt being renewed or
replaced, additional credit support or credit support of a different
character (including, without limitation, any collateral) that has not been
first offered to the Lenders; (iii) Parent Support Obligations in an amount
not to exceed $500,000,000 at any one time outstanding; (iv) Debt incurred by
HEC Inc. in an aggregate principal amount not to exceed $35,000,000; (v) in
the case of NU Enterprises, Inc. and its Subsidiaries, Debt owing to NU, NU
Enterprises, Inc. or the NU System Money Pool; and (vi) as permitted by
Section 7.02(f) above.
(i) Investments. With respect to the Borrower only, purchase, hold or
acquire any capital stock, evidences of indebtedness or other securities
(including any option, warrant or other right to acquire any of the
foregoing) of, make or permit to exist any loans or advances to, guarantee
any obligations of, or make or permit to exist any investment or any other
interest in, any other Person, or purchase or otherwise acquire (in one
transaction or a series of transactions) any assets of any other Person
constituting a business unit (each of the foregoing, an "Investment"), except
(i) equity and debt investments in (including NU System Money Pool advances
to) Select Energy Inc. in an aggregate amount not to exceed $200,000,000;
(ii) NU System Money Pool advances (other than to Select Energy Inc.) in an
aggregate amount not to exceed $100,000,000 at any one time outstanding;
(iii) other debt and equity investments in Subsidiaries of the Borrower
(other than NU System Money Pool advances and other than in Select Energy
Inc.) in an aggregate amount not to exceed $100,000,000 from and after the
Closing Date; (iv) the issuance of up to $35,000,000 in construction
completion and similar performance guaranties on behalf of HEC Inc. from and
after the Closing Date; (v) Investments permitted by subsections (b) and (h)
above; (vi) Investments other than (A) those enumerated in clauses (i)
through (v) above and (B) NU System Money Pool Advances, in each case, made
prior to the Closing Date; and (vii) Permitted Investments.
(j) Restricted Payments. With respect to the Borrower only, declare or
make, or agree to pay or make, directly or indirectly, any Restricted
Payment, except that the Borrower may (i) pay dividends to its common
stockholders in an aggregate amount not to exceed $60,000,000 during any 12-
month period beginning or ending on the Closing Date or any day thereafter
until and including the Termination Date, and (ii) redeem or repurchase
capital stock for an aggregate amount not in excess of $215,000,000 in
connection with the acquisition of Yankee Energy System Inc..
(k) Financing Agreements. With respect to the Borrower only, permit
any Principal Subsidiary to enter into any agreement, contract, indenture or
similar obligation, or issue any security (all of the foregoing being
referred to as "Financing Agreements"), that is not in effect on the Closing
Date, or amend or modify any existing Financing Agreement, if the effect of
such Financing Agreement (or amendment or modification thereof) is to impose
any additional restriction not in effect on the Closing Date on the ability
of such Principal Subsidiary to pay dividends to the Borrower; provided, that
the foregoing shall not restrict the right of Northeast Generation Company,
or any other Subsidiary of the Borrower created to hold generating assets, to
enter into any such Financing Agreement in connection with the incurrence of
nonrecourse Debt to acquire, construct or otherwise develop generating
assets.
SECTION VII.03. Financial Covenants. On and after the Closing Date,
so long as any obligation hereunder shall remain unpaid or any Lender shall
have any Commitment hereunder, the Borrower shall, unless the Majority
Lenders shall otherwise consent in writing:
(a) Common Equity Ratio. Maintain at all times a ratio of Common
Equity to Total Capitalization of at least 0.30:1:00.
(b) Interest Coverage Ratio. Maintain, as of the end of each Fiscal
Quarter, with respect to the four Fiscal Quarters then ended, a ratio of
Consolidated EBIT to Consolidated Interest Expense of at least (i) 2.00:1:00
with respect to the four Fiscal Quarters ending December 31, 2000 and
March 31, 2001, and (ii) 2.20:1.00 with respect to any period of four Fiscal
Quarters ending after March 31, 2001.
(c) Cash Flow Ratio. Maintain, as of the end of each Fiscal Quarter,
with respect to the four Fiscal Quarters then ended, a ratio of Operating
Cash Flow to Fixed Charges of at least 1.50:1.00.
SECTION VII.04. Reporting Obligations. So long as any obligation
hereunder shall remain unpaid or any Lender shall have any Commitment
hereunder, the Borrower shall, unless the Majority Lenders shall otherwise
consent in writing, furnish or cause to be furnished to the Administrative
Agent in sufficient copies for each Lender, the following:
(i) as soon as possible and in any event within ten days after the
occurrence of each Event of Default or Unmatured Default continuing on the
date of such statement, a statement of the Chief Financial Officer, Treasurer
or Assistant Treasurer of the Borrower setting forth details of such Event of
Default or Unmatured Default and the action which the Borrower proposes to
take with respect thereto;
(ii) (A) as soon as available, and in any event within fifty (50) days
after the end of each of the first three Fiscal Quarters of each Fiscal Year
of the Borrower, a copy of the Borrower's and each of its Principal
Subsidiary's Quarterly Reports on Form 10-Q submitted to the Securities and
Exchange Commission with respect to such quarter, or, if the Borrower or
Select Energy, Inc. ceases to be required to submit such report, consolidated
and unconsolidated balance sheets of the Borrower or Select Energy, Inc., as
the case may be, as of the end of such Fiscal Quarter and consolidated and
unconsolidated statements of income and retained earnings and of cash flows
of the Borrower or Select Energy, Inc., as the case may be, for the period
commencing at the end of the previous Fiscal Year and ending with the end of
such Fiscal Quarter, all in reasonable detail and duly certified (subject to
year-end audit adjustments) by the Chief Financial Officer, Treasurer,
Assistant Treasurer or Comptroller of the Borrower or Select Energy, Inc., as
the case may be, as having been prepared in accordance with generally
accepted accounting principles consistent with those applied in the
preparation of the Financial Statements; and
(B) concurrently with the delivery of the financial statements
described in the foregoing clause (a), a certificate of the Chief Financial
Officer, Treasurer, Assistant Treasurer or Comptroller of the Borrower:
(1) to the effect that such financial statements were prepared in
accordance with generally accepted accounting principles consistent with
those applied in the preparation of the Financial Statements,
(2) stating that no Event of Default or Unmatured Default has occurred
and is continuing or, if an Event of Default or Unmatured Default has
occurred and is continuing, describing the nature thereof and the action
which the Borrower proposes to take with respect thereto, and
(3) demonstrating the Borrower's compliance with the covenants set
forth in Section 7.03 hereof, for and as of the end of such Fiscal Quarter,
in each case such demonstrations to be in form satisfactory to the
Administrative Agent and to set forth in reasonable detail the computations
used in determining such compliance;
(iii) (A) 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 and
each of its Principal Subsidiary's Annual Reports on Form 10-K submitted to
the Securities and Exchange Commission with respect to such Fiscal Year, or,
if the Borrower or Select Energy, Inc. ceases to be required to submit such
report, a copy of the annual audit report for such year for the Borrower or
Select Energy, Inc., as the case may be, including therein consolidated and
unconsolidated balance sheets of the Borrower or Select Energy, Inc., as the
case may be, as of the end of such Fiscal Year and consolidated and
unconsolidated statements of income and retained earnings and of cash flows
of the Borrower or Select Energy, Inc., as the case may be, for such Fiscal
Year, all in reasonable detail and certified by a nationally-recognized
independent public accountant; and
(B) concurrently with the delivery of the financial statements
described in the foregoing clause (A), a certificate of the Chief Financial
Officer, Treasurer, Assistant Treasurer or Comptroller of the Borrower:
(1) to the effect that such financial statements were prepared in
accordance with generally accepted accounting principles consistent with
those applied in the preparation of the Financial Statements, and
(2) stating that no Event of Default or Unmatured Default has occurred
and is continuing, or if an Event of Default or Unmatured Default has
occurred and is continuing, describing the nature thereof and the action
which the Borrower proposes to take with respect thereto, and
(3) demonstrating the Borrower's compliance with the covenants set
forth in Section 7.03 hereof, for and as of the end of such Fiscal Year, in
each case such demonstrations to be in form satisfactory to the
Administrative Agent and to set forth in reasonable detail the computations
used in determining such compliance;
(iv) upon the reasonable request of the Administrative Agent, but not
more than once per Fiscal Quarter, copies of any or all filings or
registrations with, or notices or reports to, any regulatory authority by the
Borrower or any Principal Subsidiary;
(v) as soon as possible and in any event (A) within 30 days after the
Chief Financial Officer, Treasurer or any Assistant Treasurer of the Borrower
knows or has reason to know that any ERISA Plan Termination Event described
in clause (i) of the definition of ERISA Plan Termination Event with respect
to any ERISA Plan or ERISA Multiemployer Plan has occurred and (B) within 10
days after the Borrower knows or has reason to know that any other ERISA Plan
Termination Event with respect to any ERISA Plan or ERISA Multiemployer Plan
has occurred, a statement of the Chief Financial Officer, Treasurer or
Assistant Treasurer of the Borrower describing such ERISA Plan Termination
Event and the action, if any, which the Borrower proposes to take with
respect thereto;
(i) promptly after receipt thereof by the Borrower or any of its ERISA
Affiliates from the PBGC, copies of each notice received by the Borrower or
any such ERISA Affiliate of the PBGC's intention to terminate any ERISA Plan
or ERISA Multiemployer Plan or to have a trustee appointed to administer any
ERISA Plan or ERISA Multiemployer Plan;
(ii) promptly after receipt thereof by the Borrower or any of its ERISA
Affiliates from an ERISA Multiemployer Plan sponsor, a copy of each notice
received by the Borrower or any of its ERISA Affiliates concerning the
imposition or amount of withdrawal liability in an aggregate principal amount
of at least $10,000,000 pursuant to Section 4202 of ERISA in respect of which
the Borrower may be liable;
(iii) promptly after the Borrower becomes aware of the commencement
thereof, notice of all actions, suits, proceedings or other events of the
type described in Section 6.01(h) hereof (including, without limitation, any
action or proceeding relating to any environmental protection laws or
regulations);
(iv) promptly after the filing thereof, copies of each prospectus
(excluding any prospectus contained in any Form S-8) and Current Report on
Form 8-K, if any, which the Borrower or any Principal Subsidiary files with
the Securities and Exchange Commission or any successor governmental
authority; and
(v) promptly after requested, such other information respecting the
financial condition, operations, properties or prospects of the Borrower or
its Subsidiaries as the Administrative Agent, or the Majority Lenders or
Fronting Bank through the Administrative Agent, may from time to time
reasonably request in writing.
ARTICLE VIII
DEFAULTS
SECTION VIII.01. Events of Default. The following events shall each
constitute an "Event of Default":
(a) The Borrower shall fail to pay any principal of any Advance or any
Reimbursement Obligation when due or shall fail to pay any interest on any
Advance or fees or other amounts payable under the Loan Documents within two
days after the same becomes due; or
(b) Any representation or warranty made by the Borrower (or any of its
officers or agents) in any Loan Document, any certificate or other writing
delivered pursuant hereto or thereto shall prove to have been incorrect in
any material respect when made or deemed made; or
(c) The Borrower shall fail to perform or observe any term or covenant
on its part to be performed or observed contained in Section 2.02(k),
7.01(d), Section 7.02, Section 7.03 or Section 7.04(i) hereof; or
(d) The Borrower shall fail to perform or observe any other term or
covenant on its part to be performed or observed contained in any Loan
Document and any such failure shall remain unremedied for a period of 30 days
after the earlier of (i) written notice of such failure having been given to
the Borrower by the Administrative Agent or (ii) the Borrower having obtained
actual knowledge of such failure; or
(e) The Borrower or any Principal Subsidiary shall fail to pay any of
its Debt when due (including any interest or premium thereon but excluding
Outstanding Credits and excluding other Debt (except for Named Debt)
aggregating in no event more than $10,000,000 in principal amount at any one
time) whether by scheduled maturity, required prepayment, acceleration,
demand or otherwise, and such failure shall continue after the applicable
grace period, if any, specified in any agreement or instrument relating to
such Debt; or any other default under any agreement or instrument relating to
any such Debt, or any other event, shall occur and shall continue after the
applicable grace period, if any, specified in such agreement or instrument,
if the effect of such default or event 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 or as a result of the Borrower's or
such Principal Subsidiary's exercise of a prepayment option) prior to the
stated maturity thereof; or
(f) The Borrower or any Principal 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 an assignment for the benefit of
creditors; or any proceeding shall be instituted by or against the Borrower
or any Principal Subsidiary seeking to adjudicate it a bankrupt or insolvent,
or seeking liquidation, winding up, reorganization, arrangement, adjustment,
protection, relief, or composition of 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,
or other similar official for it or for any substantial part of its property
and, in the case of a proceeding instituted against the Borrower or any
Principal Subsidiary, the Borrower or such Principal Subsidiary shall consent
thereto or such proceeding shall remain undismissed or unstayed for a period
of 90 days or any of the actions sought in such proceeding (including without
limitation the entry of an order for relief against the Borrower or such
Principal Subsidiary or the appointment of a receiver, trustee, custodian or
other similar official for the Borrower or such Principal Subsidiary or any
of its property) shall occur; or the Borrower or any Principal Subsidiary
shall take any corporate or other action to authorize any of the actions set
forth above in this subsection (f); or
(g) Any judgments or orders for the payment of money in excess of
$10,000,000 (or aggregating more than $10,000,000 at any one time) shall be
rendered against the Borrower or its properties or any Principal Subsidiary
or its properties, and either (A) enforcement proceedings shall have been
commenced by any creditor upon such judgment or order and shall not have been
stayed or (B) there shall be any period of 15 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
(h) Any material provision of any Loan Document shall at any time for
any reason cease to be valid and binding on the Borrower, or shall be
determined to be invalid or unenforceable by any court, governmental agency
or authority having jurisdiction over the Borrower, or the Borrower shall
deny that it has any further liability or obligation under any Loan Document;
or
(i) A Change of Control shall have occurred; or
(j) The Borrower shall cease to own at least 85% of the outstanding
common stock of any Principal Subsidiary, free and clear of all Liens except
for Liens permitted by Section 7.02(a) hereof; or
(k) Any legal restriction that is not in existence on the Closing Date
shall materially adversely affect the ability of any Principal Subsidiary to
pay dividends or make other distributions to the Borrower.
SECTION VIII.02. Remedies Upon Events of Default. Upon the occurrence
and during the continuance of any Event of Default, the Administrative Agent
shall at the request, or may with the consent, of the Lenders entitled to
make such request, upon notice to the Borrower (i) declare the obligation of
each Lender to make Advances to the Borrower, and the obligation of the
Fronting Bank to issue Letters of Credit, to be terminated, whereupon such
obligations of the Lenders and the Fronting Bank shall forthwith terminate,
provided, that any such request or consent pursuant to this clause (i) shall
be made solely by Lenders having Percentages in the aggregate of not less 66-
2/3%; (ii) declare the Advances, all interest thereon, an amount equal to the
aggregate Stated Amount of all issued but undrawn Letters of Credit and all
other amounts payable by the Borrower under this Agreement and the other Loan
Documents to be forthwith due and payable, whereupon such Advances, 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, that any such
request or consent pursuant to this clause (ii) shall be made solely by the
Lenders holding at least 66-2/3% of the then aggregate Outstanding Credits;
and (iii) instruct the Fronting Bank to (whereupon the Fronting Bank shall)
furnish to each Beneficiary written notice of its intention to terminate such
Letter of Credit pursuant to the terms thereof, provided, that any such
request or consent pursuant to this clause (iii) shall be made solely by the
Lenders holding Percentages in the aggregate of not less that 66-2/3% or, if
the Commitments shall then have been terminated, Lenders holding at least 66-
2/3% of the then aggregate Outstanding Credits; provided, however, that if
such Event of Default is an Event of Default pursuant to subsection (f) of
Section 8.01, then (A) the obligation of each Lender to make Advances to the
Borrower, and the obligation of the Fronting Bank to issue Letters of Credit,
shall automatically be terminated and (B) the Advances, all interest thereon,
an amount equal to the aggregate Stated Amount of all issued but undrawn
Letters of Credit and all other amounts payable by the Borrower under this
Agreement and the other Loan Documents shall automatically become and be due
and payable, without presentment, demand, protest or any notice of any kind,
all of which are hereby expressly waived by the Borrower.
ARTICLE IX
THE ADMINISTRATIVE AGENT AND THE FRONTING BANK
SECTION IX.01. Authorization and Action. Each Lender hereby 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. As to any matters not expressly provided
for by the Loan Documents (including, without limitation, enforcement or
collection thereof), 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; provided, however, that
the Administrative Agent shall not be required to take any action which
exposes the Administrative Agent to personal liability or which is contrary
to the Loan Documents or applicable law. The Administrative Agent agrees to
deliver promptly to each Lender notice of each notice given to it by the
Borrower pursuant to the terms of this Agreement.
SECTION IX.02. Administrative Agent's 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 any Loan Document, except for its or their own
gross negligence or willful misconduct. Without limitation of the generality
of the foregoing, the Administrative Agent: (i) may treat each Lender party
hereto as a "Lender" hereunder and for all purposes hereof until the
Administrative Agent receives and accepts a Lender Assignment entered into by
such Lender, as assignor, and an assignee, as provided in Section 10.07;
(ii) 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) makes no warranty or representation to any Lender and shall not be
responsible to any Lender for the Information Memorandum or any other
statements, warranties or representations made in or in connection with any
Loan Document; (iv) 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
any Loan Document on the part of the Borrower to be performed or observed, or
to inspect any property (including the books and records) of the Borrower;
(v) shall not be responsible to any Lender for the due execution, legality,
validity, enforceability, genuineness, sufficiency or value of any Loan
Document or any other instrument or document furnished pursuant hereto; and
(vi) shall incur no liability under or in respect of any Loan Document by
acting upon any notice, consent, certificate or other instrument or writing
(which may be by facsimile) believed by it to be genuine and signed or sent
by the proper party or parties.
SECTION IX.03. Union Bank, Bank One, NA and Affiliates. With respect
to its Commitment and the Advances made by it, each of Union Bank and Bank
One, NA (and/or any other Lender then acting as "Fronting Bank") shall have
the same rights and powers under the Loan Documents as any other Lender and
may exercise the same as though it were not the Administrative Agent or the
Fronting Bank, as the case may be, and the term "Lender" or "Lenders" shall,
unless otherwise expressly indicated, include Union Bank and Bank One, NA
(and/or any other Lender then acting as "Fronting Bank") in its individual
capacity. Union Bank, Bank One, NA (and/or any other Lender acting as
"Fronting Bank") and their respective 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 Union Bank were not the Administrative Agent and Bank
One, NA (and/or any other Lender then acting as "Fronting Bank") were not the
Fronting Bank and without any duty to account therefor to the Lenders.
SECTION IX.04. Lender Credit Decision. Each Lender acknowledges that
it has, independently and without reliance upon the Administrative Agent, the
Fronting Bank or any other Lender and based on the Information Memorandum and
the Financial Statements 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, the Fronting Bank 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 IX.05. Indemnification. The Lenders agree to indemnify the
Administrative Agent (to the extent not reimbursed by the Borrower), ratably
according to their respective Commitments (or, if the Commitments have been
terminated, ratably according to the respective principal amounts of
Outstanding Credits held by them (provided, that if any Commitments or
Outstanding Credits are held by the Borrower or any Affiliate thereof, any
ratable apportionment hereunder shall exclude their respective Commitments
hereunder or the principal amounts of Outstanding Credits held by the
Borrower or such Affiliate)), 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 the Administrative Agent in its
capacity as such in any way relating to or arising out of any Loan Document
or any action taken or omitted by the Administrative Agent in its capacity as
such under any Loan Document, 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
the Administrative Agent's gross negligence or willful misconduct. Without
limitation of the foregoing, each Lender agrees to reimburse the
Administrative Agent promptly upon demand for such Lender's ratable share of
any out-of-pocket expenses (including counsel fees) incurred by the
Administrative 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, the Loan Documents to the extent that
the Administrative Agent is entitled to reimbursement for such expenses
pursuant to Section 10.04 but is not reimbursed for such expenses by the
Borrower.
SECTION IX.06. Successor Administrative Agent. The Administrative
Agent may resign at any time by giving written notice thereof to the Lenders
and the Borrower, with any such resignation to become effective only upon the
appointment of a successor Administrative Agent pursuant to this Section
9.06. Upon any such resignation, the Majority Lenders shall have the right
to appoint a successor Administrative Agent, which shall be a Lender or
another commercial bank or trust company reasonably acceptable to the
Borrower organized or licensed under the laws of the United States, or of any
State thereof. 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, then the retiring Administrative Agent may, on behalf of the
Lenders, appoint a successor Administrative Agent, which shall be Lender or
shall be another commercial bank or trust company organized or licensed under
the laws of the United States or of any State thereof reasonably acceptable
to the Borrower. In addition to the foregoing right of the Administrative
Agent to resign, the Majority Lenders may remove the Administrative Agent at
any time, with or without cause, concurrently with the appointment by the
Majority Lenders of a successor Administrative Agent. 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 IX shall
inure to its benefit as to any actions taken or omitted to be taken by it
while it was Administrative Agent under the Loan Documents.
ARTICLE X
MISCELLANEOUS
SECTION X.01. Amendments, Etc. No amendment or waiver of any provision
of any Loan Document, 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, do any of the following:
(a) waive, modify or eliminate any of the conditions specified in Article V,
(b) increase the Commitment of any Lender hereunder or increase the
Commitments of the Lenders that may be maintained hereunder or increase the
Borrowing Sublimit or subject the Lenders to any additional obligations,
(c) reduce the principal of, or interest on, the Advances, any Applicable
Margin or any fees or other amounts payable hereunder (other than fees
payable to the Administrative Agent pursuant to Section 2.03(b) hereof),
(d) postpone any date fixed for any payment of principal of, or interest on,
the Advances or any fees or other amounts payable under the Loan Documents
(other than fees payable to the Administrative Agent pursuant to
Section 2.03(b) hereof), (e) change the percentage of the Commitments or of
the aggregate unpaid principal amount of the Outstanding Credits, or the
number of Lenders which shall be required for the Lenders or any of them to
take any action under the Loan Documents, (f) amend any Loan Document in a
manner intended to prefer one or more Lenders over any other Lenders, or
(g) amend this Section 10.01; provided, that any waiver of, or consent to a
departure from, the requirements of Section 2.02(b) shall be effective if
authorized in writing by the Majority Lenders and the Fronting Bank, unless
the effect of such waiver or consent would be to permit the issuance of a
Letter of Credit without any right of unilateral termination on the part of
the Fronting Bank, in which case the effectiveness of such waiver or consent
shall require the written authorization of all of the Lenders and the
Fronting Bank; and provided, further, that no amendment, waiver or consent
shall, unless in writing and signed by the Administrative Agent or the
Fronting Bank, as the case may be, in addition to the Lenders required above
to take such action, affect the rights or duties of the Administrative Agent
or the Fronting Bank, as the case may be, under any Loan Document.
SECTION X.02. Notices, Etc. Except as otherwise expressly provided
herein, all notices and other communications provided for under the Loan
Documents shall be in writing (including facsimile communication) and mailed,
sent by facsimile or hand delivered:
(i) if to the Borrower, to it in care of NUSCO at 000 Xxxxxx Xxxxxx, Xxxxxx,
Xxxxxxxxxxx 00000, Attention: Assistant Treasurer, facsimile number: (860)
665-5457, confirm number: (000) 000-0000;
(ii) if to any Bank, at its Domestic Lending Office specified opposite its
name on Schedule I hereto;
(iii) if to any Lender other than a Bank, at its Domestic Lending Office
specified in the Lender Assignment pursuant to which it became a Lender;
(iv) if to the Administrative Agent, at its address at 000 Xxxxx Xxxxxxxx
Xxxxxx, Xxx Xxxxxxx, Xxxxxxxxxx 00000, Attention: Xx. Xxxxxxxx Xxxxxxxx,
Energy Capital Services, facsimile number: (000) 000-0000, confirm number:
(000) 000-0000; and
(v) if to the Fronting Bank, at its address at 000 Xxxxx Xxxxxxxxx, Xxxxx 0,
Xxxxx 0000, Xxxxxxx, Xxxxxxxx 00000, Attention: Xx. Xxxx Xxxxxxxxx,
facsimile number: (000) 000-0000, confirm number: (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, sent by facsimile or hand delivered, be
effective five days after when deposited in the mails, or when sent by
facsimile, or when delivered, respectively, except that notices and
communications to the Administrative Agent pursuant to Article II, III, IV or
IX shall not be effective until received by the Administrative Agent. With
respect to any telephone notice given or received by the Administrative Agent
pursuant to Section 3.03 hereof, the records of the Administrative Agent
shall be conclusive for all purposes.
SECTION X.03. No Waiver of Remedies. No failure on the part of the
Administrative Agent, the Fronting Bank or any Lender to exercise, and no
delay in exercising, any right under any Loan Document 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 X.04. Costs, Expenses and Indemnification
.
(a) The Borrower agrees to pay when due, in accordance with the terms
hereof: (i) all costs and expenses of the Administrative Agent in connection
with the preparation, negotiation, execution and delivery of the Loan
Documents, the administration of the Loan Documents, and any proposed
modification, amendment, or consent relating thereto (including, in each
case, the reasonable fees and expenses of counsel to the Administrative
Agent); (ii) all customary and reasonable charges, costs and expenses of the
Fronting Bank in connection with the issuance, transfer, modification or
amendment of any Letter of Credit (including, in each case, the reasonable
fees and expenses of counsel to the Fronting Bank); and (iii) all costs and
expenses of the Administrative Agent, the Fronting Bank and each Lender
(including all fees and expenses of counsel) in connection with the
enforcement, whether through negotiations, legal proceedings or otherwise, of
the Loan Documents.
(b) The Borrower hereby agrees to indemnify and hold the Administrative
Agent, the Fronting Bank and each Lender, and its officers, directors,
employees, professional advisors and affiliates (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 investigation or is otherwise subjected to judicial or legal
process arising from any such proceeding or investigation) which any of them
may incur or which may be claimed against any of them by any person or entity
(except to the extent such claims, damages, losses, liabilities, costs or
expenses arise from the gross negligence or willful misconduct of the
Indemnified Person):
(i) by reason of or in connection with the execution, delivery or
performance of the Loan Documents or any transaction contemplated thereby,
or the use by the Borrower of the proceeds of any Advance, or the issuance
of, or the use by the Borrower of, or the use by any Beneficiary of the
proceeds of, any Letter of Credit;
(ii) in connection with or resulting from the utilization, storage,
disposal, treatment, generation, transportation, release or ownership of any
Hazardous Substance (A) at, upon or under any property of the Borrower or any
of its Affiliates or (B) by or on behalf of the Borrower or any of its
Affiliates at any time and in any place; or
(iii) in connection with any documentary taxes, assessments or charges
made by any governmental authority by reason of the execution and delivery of
the Loan Documents.
(c) The Borrower's obligations under this Section 10.04 shall survive
the assignment by any Lender pursuant to Section 10.07 hereof and shall
survive as well the repayment of all amounts owing to the Lenders and the
Fronting Bank under the Loan Documents and the termination of the
Commitments. If and to the extent that the obligations of the Borrower under
this Section 10.04 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.
(d) The Borrower's obligations under this Section 10.04 are in addition
to and shall not be deemed to supersede its indemnification and similar
obligations set forth in that certain Commitment Letter dated as of
November 13, 2000 among the Borrower, Union Bank, Barclays Bank PLC and Bank
One, NA.
SECTION X.05. Right of Set-off
.
(a) 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 8.02 to authorize the Administrative Agent to declare
the Advances due and payable pursuant to the provisions of Section 8.02, 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 the Loan Documents held by such
Lender, irrespective of whether or not such Lender shall have made any demand
under the Loan Documents 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 are in addition to other rights and
remedies (including, without limitation, other rights of set-off) which such
Lender may have.
(b) The Borrower agrees that it shall have no right of off-set,
deduction or counterclaim in respect of its obligations under the Loan
Documents, and that the obligations of the Lenders hereunder are several and
not joint. Nothing contained herein shall constitute a relinquishment or
waiver of the Borrower's rights to any independent claim that the Borrower
may have against the Administrative Agent, the Fronting Bank or any Lender,
but no Lender shall be liable for the conduct of the Administrative Agent,
the Fronting Bank or any other Lender, and neither the Administrative Agent
nor the Fronting Bank shall be liable for the conduct of the other or any
Lender.
SECTION X.06. Binding Effect. This Agreement shall become effective
when it shall have been executed by the Borrower, the Administrative Agent
and the Fronting Bank 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 Administrative
Agent, the Fronting Bank and each Lender and their respective successors and
assigns, except that the Borrower shall not have the right to assign its
rights under the Loan Documents or any interest herein without the prior
written consent of the Lenders.
SECTION X.07. Assignments and Participation
.
(a) Each Lender may assign to one or more banks or other entities all
or a portion of its rights and obligations under the Loan Documents,
including, without limitation, all or a portion of its Commitment, the
Advances owing to it and its participatory interest in Letters of Credit
(with the prior written consent of the Borrower, the Fronting Bank and the
Administrative Agent if the assignee thereunder is not then a Lender or an
Affiliate of a Lender, which consent shall not be unreasonably withheld);
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 the Loan Documents, (ii) if the assignee thereunder is not
then a Lender or an Affiliate of a Lender, the amount of the Commitment,
Advance or participatory interest in Letters of Credit being assigned
pursuant to each such assignment shall in no event be less than the lesser of
the amount of the assigning Lender's Commitment and $5,000,000, and (iii) 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 in substantially the form of Exhibit 10.07 hereto
(the "Lender Assignment"), together with a processing and recordation fee of
$3,500. Upon such execution, delivery, acceptance and recording, from and
after the effective date specified in each Lender Assignment, which effective
date shall be at least five Business Days after the execution thereof,
(x) the assignee thereunder shall be a party hereto and, to the extent that
rights and obligations under the Loan Documents have been assigned to it
pursuant to such Lender Assignment, have the rights and obligations of a
Lender under the Loan Documents and (y) the Lender assignor thereunder shall,
to the extent that rights and obligations under the Loan Documents have been
assigned by it to an assignee pursuant to such Lender Assignment, relinquish
its rights and be released from its obligations under the Loan Documents
(and, in the case of a Lender Assignment covering all or the remaining
portion of an assigning Lender's rights and obligations under the Loan
Documents, such Lender shall cease to be a party to the Loan Documents);
provided, however, if an Event of Default shall have occurred and be
continuing a Lender may assign all or a portion of its rights and obligations
without the prior written consent of the Borrower but otherwise in accordance
with this Section.
(b) By executing and delivering a Lender Assignment, 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 Lender Assignment, 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 the
Loan Documents or the execution, legality, validity, enforceability,
genuineness, sufficiency or value of the Loan Documents or any other
instrument or document furnished pursuant thereto; (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 the Loan Documents
or any other instrument or document furnished pursuant thereto; (iii) such
assignee confirms that it has received a copy of the Loan Documents, together
with copies of the Financial Statements, or the latest financial statements
delivered by the Borrower to the Administrative Agent pursuant to
Section 7.04 hereof, and such other documents and information as it has
deemed appropriate to make its own credit analysis and decision to enter into
such Lender Assignment; (iv) such assignee will, independently and without
reliance upon the Administrative Agent, the Fronting Bank, 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 the Loan Documents; (v) such assignee
appoints and authorizes the Administrative Agent to take such action as agent
on its behalf and to exercise such powers under the Loan Documents as are
delegated to the Administrative Agent by the terms thereof, together with
such powers as are reasonably incidental thereto; and (vi) such assignee
agrees that it will perform in accordance with their terms all of the
obligations which by the terms of the Loan Documents are required to be
performed by it as a Lender.
(c) The Administrative Agent shall maintain at its address referred to
in Section 10.02 a copy of each Lender Assignment 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, the Fronting Bank and the Lenders may
treat each Person whose name is recorded in the Register as a Lender
hereunder for all purposes of the Loan Documents. 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 a Lender Assignment executed by an assigning
Lender and an assignee, the Administrative Agent shall, if such Lender
Assignment has been completed and is in substantially the form of Exhibit
10.07 hereto, (i) accept such Lender Assignment, (ii) record the information
contained therein in the Register and (iii) give prompt notice thereof to the
Borrower.
(e) Each Lender may sell Participations to one or more banks or other
entities in or to all or a portion of its rights and obligations under the
Loan Documents (including, without limitation, all or a portion of its
Commitment, the Advances owing to it and its participatory interest in
Letters of Credit); provided, however, that (i) such Lender's obligations
under the Loan Documents (including, without limitation, its Commitment
hereunder and its obligations under Section 2.02(l) hereof) 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 a "Lender" hereunder and for all purposes of the Loan Documents,
(iv) the Borrower, the Administrative Agent, the Fronting Bank and the other
Lenders shall continue to deal solely and directly with such Lender in
connection with such Lender's rights and obligations under the Loan
Documents, and (v) the holder of any such participation, other than an
Affiliate of such Lender, shall not be entitled to require such Lender to
take or omit to take any action under the Loan Documents, except action
(A) reducing the principal of, or interest on, the Advances, any Applicable
Margin or any fees or other amounts payable under the Loan Documents (other
than fees payable pursuant to Section 2.03(b) hereof), or (B) postponing any
date fixed for any payment of principal of, or interest on, the Advances or
any fees or other amounts payable under the Loan Documents (other than fees
payable pursuant to Section 2.03(b) hereof).
(f) Any Lender may, in connection with any assignment or participation
or proposed assignment or proposed participation pursuant to this
Section 10.07, disclose to the assignee or participant or proposed assignee
or proposed 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, in accordance with the terms of Section 10.08, to
preserve the confidentiality of any Confidential Information received by it
from such Lender.
(g) If any Lender shall have delivered a notice to the Administrative
Agent described in Section 4.03(a), (b), (c) or (f) hereof, or shall become a
non-performing Lender under Section 3.03(b) hereof, and if and so long as
such Lender shall not have withdrawn such notice or corrected such non-
performance in accordance with Section 3.03(b), the Borrower may demand that
such Lender assign, in accordance with Section 10.07 hereof, to one or more
assignees designated by the Borrower or the Administrative Agent (and
reasonably acceptable to the other), all (but not less than all) of such
Lender's Commitment, Advances, participatory and other rights and obligations
under the Loan Documents; provided that any such demand by the Borrower
during the continuance of an Event of Default or an Unmatured Default shall
be ineffective without the consent of the Majority Lenders. If, within 30
days following any such demand by the Borrower, any such assignee so
designated shall fail to tender such assignment on terms reasonably
satisfactory to the Borrower and the Borrower and the Administrative Agent
shall have failed to designate any such assignee, then such demand by the
Borrower shall become ineffective, it being understood for purposes of this
provision that such assignment shall be conclusively deemed to be on terms
reasonably satisfactory to such Lender, and such Lender shall be compelled to
tender such assignment forthwith, if (i) such assignee (A) shall agree to
such assignment in substantially the form of the Lender Assignment and
(B) shall tender payment to such Lender in an amount equal to the full
outstanding dollar amount accrued in favor of such Lender hereunder (as
computed in accordance with the records of the Administrative Agent) and
(ii) in the event the Borrower demanded such assignment, the Borrower shall
tender payment to the Administrative Agent of the processing and recording
fee specified in Section 10.07(a) for such assignment.
(h) Anything in this Section 10.07 to the contrary notwithstanding, any
Lender may assign and pledge all or any portion of its Commitment and the
Advances owing to it to any Federal Reserve Bank (and its transferees) as
collateral security pursuant to Regulation A of the Board of Governors of the
Federal Reserve System and any Operating Circular issued by such Federal
Reserve Bank. No such assignment shall release the assigning Lender from its
obligations hereunder.
SECTION X.08. Confidentiality. In connection with the negotiation and
administration of the Loan Documents, the Borrower has furnished or caused to
have furnished and will from time to time furnish or cause to be furnished to
the Administrative Agent, the Fronting Bank and the Lenders (each, a
"Recipient") written information which when delivered to the Recipient will
be deemed to be confidential (such information, other than any such
information which (i) was publicly available, or otherwise known to the
Recipient, at the time of disclosure, (ii) subsequently becomes publicly
available other than through any act or omission by the Recipient or
(iii) otherwise subsequently becomes known to the Recipient other than
through a Person whom the Recipient knows to be acting in violation of his or
its obligations to the Borrower, being hereinafter referred to as
"Confidential Information"). The Recipient will not knowingly disclose any
such Confidential Information to any third party (other than to those Persons
who have a confidential relationship with the Recipient), and will take all
reasonable steps to restrict access to such information in a manner designed
to maintain the confidential nature of such information, in each case until
such time as the same ceases to be Confidential Information or as the
Borrower may otherwise instruct. It is understood, however, that the
foregoing will not restrict the Recipient's ability to freely exchange such
Confidential Information with prospective participants in or assignees of the
Recipient's position herein, but the Recipient's ability to so exchange
Confidential Information shall be conditioned upon any such prospective
participant's entering into an understanding as to confidentiality similar to
this provision. It is further understood that the foregoing will not
prohibit the disclosure of any or all Confidential Information if and to the
extent that such disclosure may be required (i) by a regulatory agency or
otherwise in connection with an examination of the Recipient's records by
appropriate authorities, (ii) pursuant to court order, subpoena or other
legal process or (iii) otherwise, as required by law; in the event of any
required disclosure under clause (ii) or (iii), above, the Recipient agrees
to use reasonable efforts to inform the Borrower as promptly as practicable
unless the Lender is prohibited from doing so by court order, subpoena or
other legal process.
SECTION X.09. Waiver of Jury Trial. The Borrower, the Administrative
Agent, the Fronting Bank and each of the Lenders hereby irrevocably waives
all right to trial by jury in any action, proceeding or counterclaim arising
out of or relating to the Loan Documents, or any other instrument or document
delivered hereunder or thereunder.
SECTION X.10. Governing Law. The Loan Documents shall be governed by,
and construed in accordance with, the laws of the State of New York. The
Borrower, each of the Lenders, the Fronting Bank and the Administrative
Agent: (i) irrevocably submits to the jurisdiction of any New York State
Court or Federal court sitting in New York City in any action arising out of
or relating to the Loan Documents, (ii) agrees that all claims in such action
may be decided in such court, (iii) waives, to the fullest extent it may
effectively do so, the defense of an inconvenient forum and (iv) consents to
the service of process by mail. A final judgment in any such action shall be
conclusive and may be enforced in other jurisdictions. Nothing herein shall
affect the right of any party to serve legal process in any manner permitted
by law or affect its right to bring any action in any other court.
SECTION X.11. Relation of the Parties; No Beneficiary. No term,
provision or requirement, whether express or implied, of any Loan Document,
or actions taken or to be taken by any party thereunder, shall be construed
to create a partnership, association, or joint venture between such parties
or any of them. No term or provision of any Loan Document shall be construed
to confer a benefit upon, or grant a right or privilege to, any Person other
than the parties hereto.
SECTION X.12. Execution in Counterparts. 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.
SECTION X.13. Limitation of Liability. No shareholder or trustee of NU
shall be held to any liability whatever for the payment of any sum of money
or for damages or otherwise under any Loan Document, and such Loan Documents
shall not be enforceable against any such trustee in their or his or her
individual capacities or capacity and such Loan Documents shall be
enforceable against the trustees of NU only as such, and every person, firm,
association, trust or corporation having any claim or demand arising under
such Loan Documents and relating to NU, its shareholders or trustees shall
look solely to the trust estate of NU for the payment or satisfaction
thereof.
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.
NORTHEAST UTILITIES
By:
Name:
Title:
UNION BANK OF CALIFORNIA, N.A.,
as Administrative Agent
By:
Name:
Title:
BANK ONE, NA, as Fronting Bank
(Main Office - Chicago)
By:
Name:
Title:
The Banks:
Commitment: $32,083,334.00 UNION BANK OF CALIFORNIA, N.A.
By
Name:
Title:
Commitment: $32,083,334.00 BANK ONE, NA
By
Name:
Title:
Commitment: $32,083,334.00 BARCLAYS BANK PLC
By
Name:
Title:
Commitment: $32,083,334.00 CITIBANK, N.A.
By
Name:
Title:
Commitment: $32,000,000.00 FLEET NATIONAL BANK
By:
Name:
Title:
Commitment: $32,000,000.00 TORONTO DOMINION (TEXAS), INC.
By:
Name:
Title:
Commitment: $29,333,333.00 THE BANK OF NEW YORK
By:
Name:
Title:
Commitment: $29,333,333.00 THE BANK OF NOVA SCOTIA
By:
Name:
Title:
Commitment: $29,333,333.00 THE CHASE MANHATTAN BANK
By:
Name:
Title:
Commitment: $21,333,333.00 BNP PARIBAS
By:
Name:
Title:
By:
Name:
Title:
Commitment: $21,333,333.00 CIBC, INC.
By:
Name:
Title:
Commitment: $21,333,333.00 THE INDUSTRIAL BANK OF JAPAN,
LIMITED
By:
Name:
Title:
Commitment: $21,333,333.00 CITIZENS BANK OF MASSACHUSETTS
By:
Name:
Title:
Commitment: $21,333,333.00 BAYERISCHE HYPO-UND VEREINSBANK AG, NEW YORK
BRANCH
By:
Name:
Title:
By:
Name:
Title:
Commitment: $13,000,000.00 MELLON BANK, N.A.
By:
Name:
Title:
Total of Commitments: $400,000,000
SCHEDULE I
APPLICABLE LENDING OFFICES
Name of Bank
Barclays Bank PLC
Domestic Lending Xxxxxx
00 Xxxx Xxxxxx, 00XX Xxxxx
Xxx Xxxx, XX 00000
Eurodollar Lending Xxxxxx
00 Xxxx Xxxxxx, 00xx Xxxxx
Xxx Xxxx, XX 00000
Name of Bank
Citibank, NA
Domestic Lending Office
One Court Square
7th Floor, Zone 0
Xxxx Xxxxxx Xxxx, XX 00000
Eurodollar Lending Xxxxxx
Xxx Xxxxx Xxxxxx
0xx Xxxxx, Xxxx 0
Xxxx Xxxxxx Xxxx, XX 00000
Name of Bank
Bank One, NA
Domestic Lending Xxxxxx
0 Xxxx Xxx Xxxxx
Xxxxxxx, XX 00000
Eurodollar Lending Xxxxxx
0 Xxxx Xxx Xxxxx
Xxxxxxx, XX 00000
Name of Bank
Union Bank of California, N.A.
Domestic Lending Xxxxxx
000 Xxxxx Xxxxxxxx Xxxxxx
00xx Xxxxx
Xxx Xxxxxxx, XX 00000
Eurodollar Lending Xxxxxx
000 Xxxxx Xxxxxxxx Xxxxxx
00xx Xxxxx
Xxx Xxxxxxx, XX 00000
Name of Bank
The Bank of New York
Domestic Lending Xxxxxx
Xxx Xxxx Xxxxxx
Xxx Xxxx, XX 00000
Eurodollar Lending Xxxxxx
Xxx Xxxx Xxxxxx
Xxx Xxxx, XX 00000
Name of Bank
The Bank of Nova Scotia
Domestic Lending Xxxxxx
00 Xxxxx Xxxxxx
Xxxxxx, XX 00000
Eurodollar Lending Xxxxxx
00 Xxxxx Xxxxxx
Xxxxxx, XX 00000
Name of Bank
CIBC, Inc.
Domestic Lending Xxxxxx
000 Xxxxxxxxx Xxxxxx
Xxx Xxxx, XX 00000
Eurodollar Lending Xxxxxx
000 Xxxxxxxxx Xxxxxx
Xxx Xxxx, XX 00000
Name of Bank
The Chase Manhattan Bank
Domestic Lending Xxxxxx
000 Xxxx Xxxxxx
Xxx Xxxx, XX 00000
Eurodollar Lending Xxxxxx
000 Xxxx Xxxxxx
Xxx Xxxx, XX 00000
Name of Bank
Fleet National Bank
Domestic Lending Xxxxxx
Xxx Xxxxxxx Xxxxxx
Xxxxxx, XX 00000
Eurodollar Lending Xxxxxx
Xxx Xxxxxxx Xxxxxx
Xxxxxx, XX 00000
Name of Bank
The Industrial Bank of Japan, Limited
Domestic Lending Xxxxxx
0000 Xxxxxx xx xxx Xxxxxxxx
Xxx Xxxx, XX 00000-0000
Eurodollar Lending Xxxxxx
0000 Xxxxxx xx xxx Xxxxxxxx
Xxx Xxxx, XX 00000-0000
Name of Bank
Mellon Bank, N.A.
Domestic Lending Xxxxxx
Xxx Xxxxxx Xxxx Xxxxxx
Xxxxxxxxxx, XX 00000
Eurodollar Lending Xxxxxx
Xxx Xxxxxx Xxxx Xxxxxx
Xxxxxxxxxx, XX 00000
Name of Bank
BNP Paribas
Domestic Lending Xxxxxx
000 Xxxxxxx Xxxxxx
Xxx Xxxx, XX 00000
Eurodollar Lending Xxxxxx
000 Xxxxxxx Xxxxxx
Xxx Xxxx, XX 00000
Name of Bank
Toronto Dominion (Texas), Inc.
Domestic Lending Xxxxxx
00 Xxxx 00xx Xxxxxx
Xxx Xxxx, XX 00000
Eurodollar Lending Xxxxxx
00 Xxxx 00xx Xxxxxx
Xxx Xxxx, XX 00000
Name of Bank
Bayerische Hypo-und Vereinsbank AG, New York Branch
Domestic Lending Xxxxxx
000 Xxxx 00xx Xxxxxx
Xxx Xxxx, XX 00000
Eurodollar Lending Office
Grand Cayman Branch
c/o New York Branch
000 Xxxx 00xx Xxxxxx
Xxx Xxxx, XX 00000
Name of Bank
Citizens Bank of Massachusetts
Domestic Lending Xxxxxx
00 Xxxxx Xxxxxx
Xxxxxx, XX 00000
Eurodollar Lending Xxxxxx
00 Xxxxx Xxxxxx
Xxxxxx, XX 00000
SCHEDULE II
PENDING ACTIONS
None.
SCHEDULE III
EXISTING LETTERS OF CREDIT
Beneficiary Amount Number Issue Date Expiration
Date
1. FPL Energy Power
Marketing, Inc. $9,500,000.00 00322057 3/13/00 1/31/01
2. Portland Natural Gas $525,000.00 322058 3/13/00 3/12/01
Transmission System
3. American Electric Power $3,000,000.00 322797 9/26/00 12/31/00
Services Corporation
and/or AEP Energy
Services, Inc.
4. Boston Edison Company, $10,000,000.00 322498 7/11/00 2/1/01
Commonwealth Electric
Company or Cambridge
Electric Company
5. Central Maine Power $2,200,000.00 00321718 12/20/99 10/15/01
Company
6. EnergyUSA-TPC Corp. $7,000,000.00 00322999 11/1/00 3/31/01
TABLE OF CONTENTS
Page
ARTICLE I
DEFINITIONS AND ACCOUNTING TERMS
SECTION 1.01. Certain Defined Terms
SECTION 1.02. Computation of Time Periods
SECTION 1.03. Accounting Terms; Financial Statements
SECTION 1.04. Computations of Outstandings
ARTICLE II
COMMITMENTS
SECTION 2.01. The Commitments
SECTION 2.02. Letters of Credit
SECTION 2.03. Fees
SECTION 2.04. Reduction of the Commitments
SECTION 2.05. Extension of the Termination Date
ARTICLE III
CONTRACT ADVANCES
SECTION 3.01. Contract Advances
SECTION 3.02. Terms Relating to the Making of Contract Advances
SECTION 3.03. Making of Advances
SECTION 3.04. Repayment of Advances; Contract Notes
SECTION 3.05. Interest
ARTICLE IV
PAYMENTS
SECTION 4.01. Payments and Computations
SECTION 4.02. Prepayments
SECTION 4.03. Yield Protection
SECTION 4.04. Sharing of Payments, Etc
SECTION 4.05. Taxes
ARTICLE V
CONDITIONS PRECEDENT
SECTION 5.01. Conditions Precedent to Effectiveness
SECTION 5.02. Conditions Precedent to All Extensions of Credit.
SECTION 5.03. Reliance on Certificates
ARTICLE VI
REPRESENTATIONS AND WARRANTIES
SECTION 6.01. Representations and Warranties of the Borrower
ARTICLE VII
COVENANTS
SECTION 7.01. Affirmative Covenants
SECTION 7.02. Negative Covenants
SECTION 7.03. Financial Covenants
SECTION 7.04. Reporting Obligations
ARTICLE VIII
DEFAULTS
SECTION 8.01. Events of Default
SECTION 8.02. Remedies Upon Events of Default
ARTICLE IX
THE ADMINISTRATIVE AGENT AND THE FRONTING BANK
SECTION 9.01. Authorization and Action
SECTION 9.02. Administrative Agent's Reliance, Etc.
SECTION 9.03. Union Bank, Bank One, NA and Affiliates
SECTION 9.04. Lender Credit Decision
SECTION 9.05. Indemnification
SECTION 9.06. Successor Administrative Agent
ARTICLE X
MISCELLANEOUS
SECTION 10.01. Amendments, Etc.
SECTION 10.02. Notices, Etc.
SECTION 10.03. No Waiver of Remedies
SECTION 10.04. Costs, Expenses and Indemnification
SECTION 10.05. Right of Set-off
SECTION 10.06. Binding Effect
SECTION 10.07. Assignments and Participation
SECTION 10.08. Confidentiality
SECTION 10.09. Waiver of Jury Trial
SECTION 10.10. Governing Law
SECTION 10.11. Relation of the Parties; No Beneficiary
SECTION 10.12. Execution in Counterparts
SECTION 10.13. Limitation of Liability
SCHEDULES
Schedule I - Applicable Lending Offices
Schedule II - Pending Actions
Schedule III - Existing Letters of Credit
EXHIBITS
Exhibit 1.01A - Form of Contract Note
Exhibit 2.02 - Form of Letter of Credit Request
Exhibit 3.01 - Form of Notice of Contract Borrowing
Exhibit 5.01A - Form of Opinion of Day, Xxxxx & Xxxxxx, Counsel to the
Borrower
Exhibit 5.01B - Form of Opinion of Xxxxxxx X. Xxxxxx, Assistant
General Counsel of NUSCO
Exhibit 5.01C - Form of Opinion of King & Spalding, Special New
York Counsel to the Administrative Agent
Exhibit 10.07 - Form of Lender Assignment
EXECUTION COPY
CREDIT AGREEMENT
Dated as of November 17, 2000
among
NORTHEAST UTILITIES
as Borrower
THE BANKS NAMED HEREIN
UNION BANK OF CALIFORNIA, N.A.
as Administrative Agent
and
BANK ONE, NA
as Fronting Bank
BARCLAYS CAPITAL
UNION BANK OF CALIFORNIA, N.A.
and
BANC ONE CAPITAL MARKETS, INC.
as Joint Lead Arrangers
BARCLAYS BANK PLC THE BANK OF NEW YORK
as Syndication Agent THE BANK OF NOVA SCOTIA
BANK ONE, NA and
as Documentation Agent
THE CHASE MANHATTAN BANK
as Co-Agents
