EXHIBIT 10.2.6
CREDIT AGREEMENT
dated as of March 8, 2002,
among
CALPINE CORPORATION,
as the Borrower,
CERTAIN COMMERCIAL LENDING INSTITUTIONS,
as the Lenders,
THE BANK OF NOVA SCOTIA
and
BAYERISCHE LANDESBANK GIROZENTRALE,
as Lead Arrangers and Bookrunners on the Revolving Facility
XXXXXXX XXXXX XXXXXX INC.
and
DEUTSCHE BANC ALEX. XXXXX INC.,
as Lead Arrangers and Bookrunners on the Term B Facility
and as Lead Arrangers on the Revolving Facility,
THE BANK OF NOVA SCOTIA
and
CITICORP USA, INC.,
as Joint Administrative Agents,
THE BANK OF NOVA SCOTIA,
as Funding Agent,
BANK OF AMERICA, NATIONAL ASSOCIATION,
as Lead Arranger and Syndication Agent of the Revolving Facility,
CREDIT SUISSE FIRST BOSTON, CAYMAN ISLANDS BRANCH,
as Lead Arranger and Syndication Agent for the
Revolving Facility
and as Lead Arranger on the Term B Facility,
and
TD SECURITIES (USA) INC.,
as Lead Arranger for the Revolving Facility.
CREDIT AGREEMENT
THIS CREDIT AGREEMENT, dated as of March 8, 2002, among CALPINE
CORPORATION, a Delaware corporation (together with its successors, the
"Borrower"), the various financial institutions as are or may become parties
hereto (collectively, the "Lenders"), various lead arrangers, THE BANK OF NOVA
SCOTIA ("Scotiabank") as joint administrative agent and funding agent (in such
capacity, the "Agent") and CITICORP USA, INC. ("CUSA"), as Joint Administrative
Agent (in such capacity, together with Scotiabank, the "Administrative Agents").
W I T N E S S E T H:
WHEREAS, the Borrower is engaged directly and through its various
Subsidiaries and Joint Ventures in the business of acquiring, developing, owning
and operating power generation facilities, purchasing, developing and selling
electricity and steam (including geothermal steam and fluids) and purchasing,
developing and selling natural gas and other fuels and related marketing
activities; and
WHEREAS, the Borrower desires to obtain Commitments from the Lenders
pursuant to which
(a) Revolving Loans will be made to the Borrower from time to time
prior to the Revolving Loan Commitment Termination Date;
(b) Letters of Credit will be issued by an Issuer for the account of
the Borrower and under the several responsibilities of the Revolving
Lenders from time to time prior to the Revolving Loan Commitment
Termination Date; and
(c) Term B Loans will be made to the Borrower on a single
date prior to the Term B Loan Commitment Termination Date;
WHEREAS, the Lenders are willing, on the terms and subject to the
conditions hereinafter set forth (including Article VI), to extend such
Commitments, make such Loans to the Borrower and issue and participate in such
Letters of Credit;
WHEREAS, in order to facilitate the extension of such Commitments, the
making of such Loans and the issuance of such Letters of Credit, Calpine's
Wholly Owned Subsidiary, CNGH is acquiring Calpine Calgary Inc. which owns the
Canadian Gas Reserves, thereby providing additional security for this financing,
as requested by the Lenders;
WHEREAS, the Letters of Credit and the proceeds of such Loans will be
used for general corporate purposes of the Borrower and its Subsidiaries,
including, capital expenditures; provided, that no Loans or Letters of Credit
may be used to finance acquisitions (other than the acquisition of equipment,
sites and property in the ordinary course of the Borrower and its Subsidiaries'
business and the refinancing of acquisitions made on or before the date hereof,
but in no event may Loans or Letters of Credit be used to finance new
acquisitions of power projects,
reserves of geothermal steam and fluids and natural gas reserves) or make new
Investments in any third parties (other than investments in Subsidiaries);
NOW, THEREFORE, the parties hereto agree as follows:
ARTICLE I
DEFINITIONS AND ACCOUNTING TERMS
SECTION 1.1. Defined Terms. The following terms (whether or not
underscored) when used in this Agreement, including its preamble and recitals,
shall, except where the context otherwise requires, have the following meanings
(such meanings to be equally applicable to the singular and plural forms
thereof):
"Acquisition" means an acquisition by the Borrower or any of its
Subsidiaries of power projects, reserves of geothermal steam and fluids, natural
gas reserves, and other assets within the scope of its existing business.
"Additional Assets" means (i) any property or assets related to the
ownership, acquisition, development, construction, improvement and operation of
Facilities, including any related fuel reserves, which will be owned and used by
the Borrower or a Subsidiary; (ii) the capital stock of a Person that becomes a
Subsidiary as a result of the acquisition of such capital stock by the Borrower
or another Subsidiary or (iii) capital stock constituting a minority interest in
any Person that at such time is a Subsidiary.
"Administrative Agents" is defined in the preamble.
"Affiliate" of any Person means any other Person which, directly or
indirectly, controls, is controlled by or is under common control with such
Person (excluding any trustee under, or any committee with responsibility for
administering, any Plan). A Person shall be deemed to be "controlled by" any
other Person if such other Person possesses, directly or indirectly, power
(a) to vote 10% or more of the securities (on a fully diluted basis)
having ordinary voting power for the election of directors or managing
general partners; or
(b) to direct or cause the direction of the management and policies
of such Person whether by contract or otherwise.
"Agent" is defined in the preamble and includes each other Person as shall
have subsequently been appointed as the successor Agent pursuant to Section
10.4.
"Aggregate Percentage" means, relative to any Lender, the percentage
set forth opposite its name on Schedule II under the caption "Aggregate
Percentage" or as set forth in its Lender Assignment Agreement, as such
percentage may be adjusted from time to time pursuant to Sections 2.7 or 2.8 or
pursuant to Lender Assignment Agreement(s) executed by such Lender and its
Assignee Lender(s) and delivered pursuant to Section 11.11.
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"Agreement" means, on any date, this Credit Agreement as originally in
effect on the Effective Date and as thereafter from time to time amended,
supplemented, amended and restated, or otherwise modified and in effect on such
date.
"Alternate Base Rate" means, on any date and with respect to all Base Rate
Loans, a fluctuating rate of interest per annum equal to the higher of
(a) the rate of interest most recently established by Scotiabank at
its Domestic Office as its base rate; and
(b) the Federal Funds Rate most recently determined by Scotiabank
plus 1/2 of 1%.
The Alternate Base Rate is not necessarily intended to be the lowest rate of
interest determined by the Agent in connection with extensions of credit.
Changes in the rate of interest on that portion of any Loans maintained as Base
Rate Loans or any L/C Advances will take effect simultaneously with each change
in the Alternate Base Rate. The Agent will give notice promptly to the Borrower
and the Lenders of changes in the Alternate Base Rate.
"Applicable LIBO Rate Margin" is the rate per annum in respect of any Loan
or L/C Advance determined by reference to the relevant "Applicable LIBO Rate
Margin" for such Loan or L/C Advance in the definition of the term "Applicable
Margin."
"Applicable Margin" means, in the case of any Base Rate Loan, LIBO Rate
Loan or L/C Advance maintained under the Revolving Loan Commitment, a rate per
annum determined by reference to the Borrower's Credit Rating as follows:
Revolving Loans
---------------
Applicable Base Applicable LIBO
Borrower's Credit Rating Rate Margin Rate Margin
------------------------ ----------- -----------
Xxxxx 0 0.50% 1.50%
Xxxxx 0 0.75% 1.75%
Xxxxx 0 1.00% 2.00%
Xxxxx 0 1.25% 2.25%
Xxxxx 0 1.75% 2.75%
The applicable Level for the Borrower shall be determined by reference to the
definition of the term "Borrower's Credit Rating." The Applicable Margin for any
Term B Loan maintained as a LIBO Rate Loan shall be 2.75% and the Applicable
Margin for any Term B Loan maintained as a Base Rate Loan shall be 1.75%.
Notwithstanding anything to the contrary herein, if at the time of the Borrowing
of Term B Loans hereunder, the Applicable Margin for any Term B Loan shall have
been increased or decreased from the rates set forth in the preceding sentence
in accordance with Section 11.1, the Applicable Margin for Revolving Loans as
set forth above shall be increased or decreased by a corresponding amount. For
example, if at the time of the Borrowing
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of Term B Loans, the Applicable Margin for Term B Loans maintained as LIBO Rate
Loans shall be reset at 3.5%, the Applicable Margin for all Revolving Loans
shall be increased by .75% in all circumstances. Notwithstanding the foregoing,
from the Effective Date through the earlier of (i) the date the Loans have
received a rating from S&P or Moody's or (ii) September 8, 2002, the Borrower's
credit rating shall be deemed to be Level 3.
"Arranger" or "Arrangers" means, individually or collectively as the case
may be, each of Scotiabank, BayernLB, Deutsche, Xxxxxxx Xxxxx Xxxxxx Inc., Bank
of America, National Association, Credit Suisse First Boston, Cayman Islands
Branch and TD Securities (USA) Inc.
"Asset Sale" means any sale, transfer, lease or other disposition described
in Section 8.2.10(b).
"Assignee Lender" is defined in Section 11.11.1.
"Assignment Agreement" means that certain Assignment and Security Agreement
executed and delivered by the Borrower pursuant to Section 6.1.8, substantially
in the form of Exhibit J hereto, as amended, supplemented, amended and restated
or otherwise modified from time to time.
"Attributable Debt" means, with respect to a Sale/Leaseback Transaction,
the present value as of the date of determination (discounted at the weighted
average interest rate borne by the Senior Notes, compounded annually) of the
total obligations of the lessee for rental payments for the remaining term of
the lease included in such Sale/Leaseback Transaction (including any period for
which such lease has been extended).
"Authorized Officer" means, relative to any Obligor, the president, any
executive vice president, any senior vice president, the vice president -
finance, the chief financial officer and the treasurer, in each case for whom a
signature and incumbency certificate has been delivered to the Agent.
"Base Rate Loan" means a Loan bearing interest at a fluctuating rate
determined by reference to the Alternate Base Rate.
"BayernLB" means Bayerische Landesbank Girozentrale.
"Borrower" is defined in the preamble.
"Borrower EBITDA" means, for any period, the consolidated EBITDA of the
Borrower and its Subsidiaries, minus that portion of Consolidated Interest
Expense payable by the consolidating Subsidiaries, minus the principal payments
of the consolidating Subsidiaries, minus the consolidated non-discretionary
Capital Expenditures (i.e., Capital Expenditures which are expressly required to
be made under any agreement, contract, instrument, permit, license, law,
regulation, judgment or other arrangement (other than those arrangements and
contracts that relate to the performance of the work for which the Capital
Expenditure is being made) binding on the Borrower or any Subsidiary) of the
Borrower and its Subsidiaries, plus, without duplication, cash and Cash
Equivalent Investments of the Borrower's Wholly Owned Subsidiaries and Cogen
America that are legally and contractually available to each such
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Subsidiary for the payment of dividends, but only to the extent the source of
such cash and Cash Equivalent Investments is from such Subsidiary's EBITDA or
from repayments to such Subsidiary of loans made by such Subsidiary.
"Borrower Interest Expense" means, for any period, as applied to the
Borrower, the sum of (a) the total interest expense of the Borrower for such
period as determined in accordance with GAAP, including, without limitation, all
interest paid by the Borrower under its subordinated debt securities issued to a
Trust, plus (b) all but the principal component of rentals in respect of
Capitalized Lease Liabilities paid, accrued, or scheduled to be paid or accrued
by the Borrower, plus (c) one-third of all operating lease obligations paid,
accrued and/or scheduled to be paid by the Borrower, plus (d) capitalized
interest plus (e) dividends paid in respect of preferred stock of the Borrower
held by Persons other than the Borrower, plus (f) cash contributions to any
employee stock ownership plan to the extent such contributions are used by such
employee stock ownership plan to pay interest or fees to any person (other than
Borrower) in connection with loans incurred by such employee stock ownership
plan to purchase capital stock of the Borrower.
"Borrower's Credit Rating" means, at any time that the Loans shall have
been rated by Standard & Poor's Ratings Group ("S&P") or Xxxxx'x Investor
Service, Inc. ("Moody's"), a level determined in accordance with the following
standards: the Borrower's Credit Rating shall be "Level 1" if the Loans have (a)
an S&P Loan Rating of BBB or better or (b) a Moody's Loan Rating of Baa2 or
better. The Borrower's Credit Rating shall be "Level 2" if the Loans do not meet
the standards for a "Level 1" rating set forth above and have (a) an S&P Loan
Rating of BBB- or better or (b) a Moody's Loan Rating of Baa3 or better. The
Borrower's Credit Rating shall be "Level 3" if the Loans do not meet the
standards for a "Level 1" or "Level 2" rating set forth above and have (a) an
S&P Loan Rating of BB+ or better or (b) a Moody's Loan Rating of Ba1 or better.
The Borrower's Credit Rating shall be "Level 4" if the Loans do not meet the
standards for a "Level 1", "Level 2" or "Level 3" rating set forth above and
have (a) an S&P Loan Rating of BB or better or (b) a Moody's Loan Rating of Ba2
or better. If the Loans do not meet the standards for "Level 1", "Level 2",
"Level 3" or "Level 4" set forth above or fail to have either an S&P Loan Rating
or a Moody's Loan Rating, then the Borrower's Credit Rating shall be "Level 5".
Notwithstanding the foregoing, if the Borrower's S&P Loan Rating and Moody's
Loan Rating shall differ by two or more Levels, the applicable Level shall be
one level numerically higher than the numerically lower of such Levels. As used
herein, "S&P Loan Rating" means the debt rating given to the Loans from time to
time by S&P and "Xxxxx'x Loan Rating" means the debt rating given to the Loans
from time to time by Moody's. In the event the Loans have an S&P Loan Rating or
a Moody's Loan Rating but not both, the Borrower's Credit Rating shall be
determined on the basis of the single rating that is available without reference
to the other rating. At all times after September 8, 2002, if the Loans shall
not have a rating from S&P or Moody's, the Borrower's Credit Rating shall be
"Level 5". Changes in the Borrower's Credit Rating shall take effect (i) in the
case of Applicable LIBO Rate Margin for LIBO Rate Loans, at the beginning of the
following Interest Period, and (ii) otherwise, as of the date of public
announcement by either S&P or Moody's.
"Borrowing" means the Loans of the same type and, in the case of LIBO
Rate Loans, having the same Interest Period made by all Lenders on the same
Business Day and pursuant to the same Borrowing Request in accordance with
Section 2.1.
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"Borrowing Request" means a loan request and certificate duly executed by
an Authorized Officer of the Borrower, substantially in the form of Exhibit B.
"Business Day" means
(a) any day which is neither a Saturday or Sunday nor a legal
holiday on which banks are authorized or required to be closed in San
Francisco or New York; and
(b) relative to the making, continuing, prepaying or repaying of any
LIBO Rate Loans, any day on which dealings in Dollars are carried on in the
London interbank market.
"Calpine Gilroy" means Calpine Gilroy Cogen, L.P., a Delaware limited
partnership.
"Calpine Holdings" means Calpine CCFC Holdings, Inc., a Wholly Owned
Subsidiary of the Borrower.
"Canadian Dollars" and the sign "Cdn$" shall each mean freely transferable
lawful money of Canada.
"Canadian Gas Reserves" means the gas reserves of the Borrower's Canadian
Subsidiaries.
"Capital Expenditures" means, for any period, the aggregate amount of all
expenditures of the Borrower and its Subsidiaries for fixed or capital assets
made during such period which, in accordance with GAAP, would be classified as
capital expenditures.
"Capitalized Lease Liabilities" means all rental obligations of the
Borrower or any of its Subsidiaries under any leasing or similar arrangement
which, in accordance with GAAP, would be classified as capitalized leases, and,
for purposes of this Agreement and each other Loan Document, the amount of such
obligations shall be the capitalized amount thereof, determined in accordance
with GAAP, and the stated maturity thereof shall be the date of the last payment
of rent or any other amount due under such lease prior to the first date upon
which such lease may be terminated by the lessee without payment of a penalty.
"Cash Equivalent Investment" means, at any time:
(a) any evidence of Indebtedness, maturing not more than one year
after such time, issued or guaranteed by the United States government or
an agency or instrumentality thereof;
(b) commercial paper, maturing not more than nine months from the
date of issue, which is issued by
(i) a corporation (excluding Affiliates of the Borrower)
organized under the laws of any state of the United States or of the
District of Columbia and rated at least A-l by S&P or P-l by Moody's,
or
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(ii) any Lender (or its holding company or Affiliates);
(c) any certificate of deposit or bankers acceptance, maturing not
more than one year after such time, which is issued by either
(i) a commercial banking institution that is a member of the
Federal Reserve System and has a combined capital and surplus and
undivided profits of not less than $500,000,000, or
(ii) any Lender;
(d) money market mutual funds registered with the Securities and
Exchange Commission;
(e) corporate evidences of indebtedness rated A or better by S&P or
A2 or better by Moody's;
(f) any repurchase agreement entered into with any Lender (or other
commercial banking institution of the stature referred to in clause (c)
(i)) which
(i) is secured by a fully perfected security interest in any
obligation of the type described in any of clauses (a) through (e);
and
(ii) has a market value at the time such repurchase agreement
is entered into of not less than 100% of the repurchase obligation of
such Lender (or other commercial banking institution) thereunder; or
(g) any other investment approved by the Required Lenders.
"CCEC" means Calpine Canada Energy Ltd., a Nova Scotia limited liability
company.
"CCEF" means Calpine Canada Energy Finance ULC, a Nova Scotia unlimited
liability company, and a direct Wholly Owned Subsidiary of QCH.
"CCFCI" means Calpine Construction Finance Company, LP a Delaware limited
partnership and an indirect, Wholly Owned Subsidiary of the Borrower.
"CERCLA" means the Comprehensive Environmental Response, Compensation and
Liability Act of 1980, as amended.
"CERCLIS" means the Comprehensive Environmental Response Compensation
Liability Information System List.
"Change in Control" means (i) the acquisition by any Person, or two or
more Persons acting in concert, of beneficial ownership (within the meaning of
Rule 13d-3 of the Securities and Exchange Commission under the Securities
Exchange Act of 1934) of 30% or more of the outstanding shares of voting stock
of the Borrower and/or (ii) any "Change of Control" under (and as defined in)
the Xxx-0000 Xxxxxxxxxx.
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"CNGC" means Calpine Natural Gas Company LP, a Delaware limited
partnership, the 99% limited partner of which is CNGH and the 1% general partner
of which is CNGGP.
"CNGGP" means Calpine Natural Gas GP, Inc., a Delaware corporation and a
direct, Wholly Owned Subsidiary of the Borrower.
"CNGH" means Calpine Natural Gas Holdings, Inc., a Delaware corporation and
a direct, Wholly Owned Subsidiary of the Borrower.
"Code" means the Internal Revenue Code of 1986, as amended, reformed or
otherwise modified from time to time.
"Cogen America" means Calpine Cogeneration Corporation (previously named
Cogeneration Corporation of America), a Delaware corporation of which the
Borrower owns not less than 50% of the outstanding voting stock.
"Commitment" means, relative to any Term B Lender, its Term B Loan
Commitment and relative to any Revolving Lender, its Revolving Loan Commitment.
"Commitment Amount" means, as the context may require, either the Term
B Loan Commitment Amount or the Revolving Commitment Amount.
"Commitment Termination Date" means, as the context may require, either
the Revolving Loan Commitment Termination Date or the Term B Loan Commitment
Termination Date.
"Commitment Termination Event" means
(a) the occurrence of any Default described in clauses (a) through
(d) of Section 9.1.9 with respect to the Borrower or any Significant
Subsidiary; or
(b) the occurrence and continuance of any other Event of Default and
either
(i) the declaration of the Loans to be due and payable
pursuant to Section 9.3, or
(ii) in the absence of such declaration, the giving of notice
by the Agent, acting at the direction of the Required Lenders, to the
Borrower that the Commitments have been terminated.
"Consolidated Income Tax Expense" means, for any period, as applied to the
Borrower, the provision for local, state, federal or foreign income taxes on a
consolidated basis for such period determined in accordance with GAAP.
"Consolidated Interest Expense" means, for any period, as applied to the
Borrower, the sum of (a) the total interest expense of the Borrower and its
consolidated Subsidiaries for such period as determined in accordance with GAAP,
plus (b) all but the principal component of rentals in respect of Capitalized
Lease Liabilities paid, accrued, or scheduled to be paid or
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accrued by the Borrower or its consolidated Subsidiaries, plus (c) one-third of
all operating lease obligations paid, accrued, and/or scheduled to be paid by
the Borrower and its consolidated Subsidiaries, plus (d) capitalized interest,
plus (e) dividends paid in respect of preferred stock of the Borrower or any
Subsidiary held by Persons other than the Borrower or a Wholly Owned
Subsidiary, including, without limitation, but without duplication of payments
by the Borrower to a Trust, all payments by a Trust of dividends and
distributions with respect to the Guaranteed Preferred Securities, plus (f)
cash contributions to any employee stock ownership plan to the extent such
contributions are used by such employee stock ownership plan to pay interest or
fees to any Person (other than the Borrower or a Subsidiary) in connection with
loans incurred by such employee stock ownership plan to purchase capital stock
of the Borrower.
"Consolidated Net Income (Loss)" means, for any period, as applied to the
Borrower, the Consolidated Net Income (loss) of the Borrower and its
consolidated Subsidiaries for such period, determined in accordance with GAAP,
adjusted by excluding (without duplication), to the extent included in such net
income (loss), the following: (i) all extraordinary gains or losses; (ii) any
net income of any Person if such Person is not incorporated or organized in the
United States, a state thereof or the District of Columbia, except that (A) the
Borrower's equity in the net income of any such Person for such period shall be
included in Consolidated Net Income (Loss) up to the aggregate amount of cash
actually distributed by such Person during such period to the Borrower or a
Subsidiary incorporated or organized in the United States, a state thereof or
the District of Columbia, as a dividend or other distribution and (B) the equity
of the Borrower or a Subsidiary in a net loss of any such Person for such period
shall be included in determining Consolidated Net Income (Loss); (iii) the net
income of any Subsidiary to the extent that the declaration or payment of
dividends or similar distributions by such Subsidiary of such income is not at
the time thereof permitted, directly or indirectly, by operation of the terms of
its charter or by-laws or any agreement, instrument, judgment, decree, order,
statute, rule or governmental regulation applicable to such Subsidiary or its
stockholders; (iv) any net income (or loss) of any Person combined with the
Borrower or any of its Subsidiaries on a "pooling of interests" basis
attributable to any period prior to the date of such combination; (v) any gain
(but not loss) realized upon the sale or other disposition of any property,
plant or equipment of the Borrower or its Subsidiaries (including pursuant to
any sale-and-leaseback arrangement) which is not sold or otherwise disposed of
in the ordinary course of business and any gain (but not loss) realized upon the
sale or other disposition by the Borrower or any Subsidiary of any capital stock
of any Person, provided that losses shall be included on an after-tax basis; and
(vi) the cumulative effect of a change in accounting principles; and further
adjusted by subtracting from such net income the tax liability of any parent of
the Borrower to the extent of payments made to such parent by the Borrower
pursuant to any tax sharing agreement or other arrangement for such period.
"Contingent Liability" means any agreement, undertaking or arrangement by
which any Person guarantees, endorses or otherwise becomes or is contingently
liable upon (by direct or indirect agreement, contingent or otherwise, to
provide funds for payment, to supply funds to, or otherwise to invest in, a
debtor, or otherwise to assure a creditor against loss) the indebtedness,
obligation or any other liability of any other Person (other than by
endorsements of instruments in the course of collection), or guarantees the
payment of dividends or other distributions upon the shares of any other Person.
The amount of any Person's obligation under any Contingent Liability shall be
calculated on a net basis (i.e., after taking into effect agreements,
undertakings and other arrangements between the Person whose obligations are
being guaranteed and the
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counterparty to such Person's obligations) and shall (subject to any limitation
set forth therein) be deemed to be the outstanding net principal amount (or
maximum net principal amount, if larger) of the debt, obligation or other
liability guaranteed thereby, or, if the principal amount is not stated or
determinable, the maximum reasonably anticipated net liability in respect
thereof as determined by the Person in good faith, provided that (y) the amount
of any Contingent Liability arising out of any indebtedness, obligation or
liability other than the items described in clauses (a), (b) and (c) of the
definition of "Indebtedness" and (z) the amount of any Contingent Liability
consisting of a "keep-well", "make well" or other similar arrangement shall be
deemed to be zero unless and until the Borrower is required to make any payment
with respect thereto (and shall thereafter be deemed to be the amount required
to be paid).
"Continuation/Conversion Notice" means a notice of continuation or
conversion and certificate duly executed by an Authorized Officer of the
Borrower, substantially in the form of Exhibit C.
"Controlled Group" means all members of a controlled group of corporations
and all members of a controlled group of trades or businesses (whether or not
incorporated) under common control which, together with the Borrower, are
treated as a single employer under Section 414(b) or 414(c) of the Code or
Section 4001 of ERISA.
"Convertible Senior Notes" means the $1,200,000,000 of 4% Convertible
Senior Notes Due 2006 issued by the Borrower pursuant to the Shelf Indenture.
"Credit Extension" means and includes (a) the advancing of any Loans by
the applicable Lenders in connection with a Borrowing, and (b) any issuance or
extension by an Issuer of a Letter of Credit.
"CSFB" means Credit Suisse First Boston, Cayman Islands Branch.
"CUSA" is defined in the preamble.
"Debt" means the outstanding principal amount of all Indebtedness of the
Borrower and its consolidated Subsidiaries of the nature referred to in clauses
(a), (b), (c) and (f) of the definition of "Indebtedness," and (without
duplication) all Contingent Liabilities in respect of any of the foregoing.
"Dedicated Assets" means, collectively, the Domestic Gas Reserves, the
Canadian Gas Reserves, all property owned by Calpine Holdings and any of its
Subsidiaries, all property owned by CCEC and any of its Subsidiaries (other than
Calpine Canada Power Holdings Ltd. and its Subsidiaries), the final 25% of the
Borrower's indirect equity ownership interest in the holding company which owns
the Xxxxxxx Energy Centre, the Island Energy Centre and the Calgary Energy
Centre, the property subject to the Pledge Agreements, the Deeds of Trust, the
Assignment Agreement and all other property and interests pledged as collateral
security for the Obligations. The Dedicated Assets shall be ratably available to
secure the Obligations under this Agreement and the Existing Credit Agreement.
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"Dedicated Subsidiary" means CCEC and each of its Subsidiaries, Calpine
Holdings (and any successor thereto) and each of its Subsidiaries, CNGGP and
each of its Subsidiaries and CNGH and each of its Subsidiaries.
"Deed of Trust" means each mortgage, deed of trust, or other real property
collateral security instrument in a form reasonably satisfactory to the Agent,
executed and delivered pursuant to Section 8.1.8 as amended, supplemented,
restated or otherwise modified from time to time.
"Default" means any Event of Default or any condition, occurrence or event
which, after notice or lapse of time or both, would constitute an Event of
Default.
"Deutsche" means Deutsche Banc Alex. Xxxxx Inc.
"Disbursement" is defined in Section 4.5.
"Disbursement Date" is defined in Section 4.5.
"Disclosure Schedule" means the Disclosure Schedule attached hereto as
Schedule 1, as it may be amended, supplemented or otherwise modified from time
to time by the Borrower with the written consent of the Agent and the Required
Lenders.
"Dollar" and the sign "$" mean lawful money of the United States.
"Domestic Gas Reserves" means the gas reserves of the Borrower and its
Subsidiaries located in the United States.
"Domestic Office" means, relative to any Lender, the office of such Lender
designated as such below its signature hereto or designated in the Lender
Assignment Agreement or such other office of a Lender (or any successor or
assign of such Lender) within the United States as may be designated from time
to time by notice from such Lender, as the case may be, to each other Person
party hereto. A Lender may have separate Domestic Offices for purposes of
making, maintaining or continuing Base Rate Loans.
"EBITDA" means, for any period, as applied to the Borrower, the sum of
Consolidated Net Income (Loss) (but without giving effect to adjustments,
accruals, deductions or entries resulting from purchase accounting,
extraordinary losses or gains and any gains or losses from any Asset Sales),
plus the following to the extent included in calculating Consolidated Net Income
(Loss): (a) Consolidated Income Tax Expense, (b) Consolidated Interest Expense,
(c) depreciation expense, (d) amortization expense and (e) all other non-cash
items reducing Consolidated Net Income, less all non-cash items increasing
Consolidated Net Income, in each case for such period; provided that, if the
Borrower has any Subsidiary that is not a Wholly Owned Subsidiary, EBITDA shall
be reduced (to the extent not otherwise reduced by GAAP) by an amount equal to
(A) the consolidated net income (loss) of such Subsidiary (to the extent
included in Consolidated Net Income (Loss)) multiplied by (B) the quotient of
(1) the number of shares of outstanding common stock of such Subsidiary not
owned on the last day of such period by the Borrower or any Wholly Owned
Subsidiary of the Borrower divided by (2) the total number of shares of
outstanding common stock of such Subsidiary on the last day of such period.
11
"8 1/4% Senior Notes" means the $250,000,000 of 8 1/4% Senior Notes due
2005 issued by the Borrower pursuant to the Shelf Indenture.
"8 1/2% Senior Notes" means the $2,000,000,000 of 8 1/2% Senior Notes due
2011 issued by the Borrower pursuant to the Shelf Indenture.
"8 3/4% Senior Note Indenture" means that certain Indenture dated as of
July 8, 1997, as supplemented by the First Supplemental Indenture dated as of
September 10, 1997 and the Second Supplemental Indenture dated as of July 31,
2000, between the Borrower and The Bank of New York, as Trustee.
"8 3/4% Senior Notes" means the $275,000,000 of 8 3/4% Senior Notes due
2007 issued by the Borrower pursuant to the 8 3/4% Senior Note Indenture.
"8 5/8% Senior Notes" means the $750,000,000 of 8 5/8% Senior Notes due
2010 issued by the Borrower pursuant to the Shelf Indenture.
"Effective Date" means the date on or before March 15, 2002, specified
in a written notice from the Agent on which this Agreement becomes effective
pursuant to Section 11.8.
"Environmental Laws" means all applicable federal, state or local statutes,
laws, ordinances, codes, rules, regulations and guidelines (including consent
decrees and administrative orders) relating to public health and safety and
protection of the environment.
"Equivalent Amount" means, on any date, and in respect of any Foreign
Currency Letter of Credit, the equivalent amount in U.S. Dollars of the Stated
Amount of any such Foreign Currency Letter of Credit (or any related
Reimbursement Obligations or Disbursements) denominated in either Canadian
Dollars or Sterling, as the case may be, determined by using the quoted spot
rate at which the Issuer of such Letter of Credit offers to exchange Dollars for
such Canadian Dollars or Sterling at the opening of business on such date.
"ERISA" means the Employee Retirement Income Security Act of 1974, as
amended, and any successor statute of similar import, together with the
regulations thereunder, in each case as in effect from time to time. References
to sections of ERISA also refer to any successor sections.
"Event of Default" is defined in Section 9.1.
"Excepted Prospects" is defined in Section 6.1.14.
"Existing Credit Agreement" means that certain Second Amended and Restated
Credit Agreement dated as of May 23, 2000, among the Borrower, various lenders
and Scotiabank, as administrative agent, as the same may be amended from time
to time.
"Existing Letters of Credit" means the letters of credit and bank guarantee
described in Schedule 4.10.
12
"Facility" means a power generation facility or energy producing
facility and all related assets and facilities, including any related fuel
reserves.
"Federal Funds Rate" means, for any period, a fluctuating interest rate
per annum equal for each day during such period to
(a) the weighted average of the rates on overnight federal funds
transactions with members of the Federal Reserve System arranged by federal
funds brokers, as published for such day (or, if such day is not a Business
Day, for the next preceding Business Day) by the Federal Reserve Bank of
New York; or
(b) 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 Scotiabank from three federal funds brokers of recognized
standing selected by it.
"Fee Letter" means the fee letter agreement described in Section 3.3.2.
"Fiscal Quarter" means any period of three consecutive months ending on
March 31, June 30, September 30 or December 31 of any year.
"Fiscal Year" means any period of twelve consecutive calendar months
ending on December 31; references to a Fiscal Year with a number corresponding
to any calendar year (e.g. the "2002 Fiscal Year") refer to the Fiscal Year
ending on the December 31 occurring during such calendar year.
"Foreign Currency Letter of Credit" means any Letter of Credit denominated
in either Canadian Dollars or Sterling.
"Foreign Currency Letter of Credit Commitment Amount" means $200,000,000.
"Foreign Currency Letter of Credit Outstandings" means any Letter of Credit
Outstandings in respect of Foreign Currency Letters of Credit.
"F.R.S. Board" means the Board of Governors of the Federal Reserve System
or any successor thereto.
"GAAP" is defined in Section 1.4.
"Guaranteed Preferred Securities" means the preferred securities issued by
one of the Trusts, from time to time, including, without limitation the
$276,000,000 of principal amount of such securities issued in October, 1999,
the $300,000,000 of principal amount of such securities issued in January,
2000, the $60,000,000 of principal amount of such securities issued in
February, 2000, and the $517,500,000 of principal amount of such securities
issued in August, 2000.
"Guarantors" means, collectively, QM, JOQ and QCH and any other Subsidiary
of the Borrower that executes a joinder to the Guaranty and becomes a party
thereto.
13
"Guaranty" means the guaranty executed and delivered by the Guarantors
pursuant to Section 6.1.3, which shall be substantially in the form of Exhibit H
hereto, as amended, supplemented or otherwise modified from time to time.
"Hazardous Material" means
(a) any "hazardous substance", as defined by CERCLA;
(b) any "hazardous waste", as defined by the Resource Conservation
and Recovery Act, as amended;
(c) any petroleum product; or
(d) any pollutant or contaminant or hazardous, dangerous or toxic
chemical, material or substance within the meaning of any other applicable
federal, state or local law, regulation, ordinance or requirement
(including consent decrees and administrative orders) relating to or
imposing liability or standards of conduct concerning any hazardous, toxic
or dangerous waste, substance or material, all as amended or hereafter
amended.
"Hazardous Materials Indemnity" means that certain Hazardous Materials
Indemnity executed and delivered by the Borrower pursuant to Section 8.1.8, in a
form satisfactory to the Administrative Agents, as amended, supplemented,
restated or otherwise modified from time to time.
"Hedging Obligations" means, with respect to any Person, the net
liabilities of such Person under (a) interest rate swap agreements, interest
rate cap agreements and interest rate collar agreements, foreign exchange
contracts, currency swap agreements and all other agreements or arrangements
designed to protect such Person against fluctuations in interest rates or
currency exchange rates and (b) commodity or power swap or exchange agreements.
"herein", "hereof", "hereto", "hereunder" and similar terms contained in
this Agreement or any other Loan Document refer to this Agreement or such other
Loan Document, as the case may be, as a whole and not to any particular
Section, paragraph or provision of this Agreement or such other Loan Document.
"Impermissible Qualification" means, relative to the opinion or
certification of any independent public accountant as to any financial statement
of any Obligor, any qualification or exception to such opinion or certification
(a) which is of a "going concern" or similar nature;
(b) which relates to the limited scope of examination of matters
relevant to such financial statement; or
(c) which relates to the treatment or classification of any item in
such financial statement and which, as a condition to its removal, would
require an adjustment
14
to such item the effect of which would be to cause such Obligor to be in
default of any of its obligations under Section 8.2.4.
"including" means including without limiting the generality of any
description preceding such term, and, for purposes of this Agreement and each
other Loan Document, the parties hereto agree that the rule of ejusdem generis
shall not be applicable to limit a general statement, which is followed by or
referable to an enumeration of specific matters, to matters similar to the
matters specifically mentioned.
"Increasing Lender" is defined in Section 2.7.
"Indebtedness" of any Person means, without duplication:
(a) all obligations of such Person for borrowed money and all
obligations of such Person evidenced by bonds, debentures, notes or other
similar instruments (excluding the Borrower's subordinated debt securities
issued to a Trust and the Guaranteed Preferred Securities or any similar
securities);
(b) all obligations, contingent or otherwise, relative to the stated
amount of all letters of credit, whether or not drawn, and banker's
acceptances issued for the account of such Person; provided, however, that
if a letter of credit or banker's acceptance has been issued to support or
secure any other form of Indebtedness, only the greater of the stated
amount of such letter of credit or banker's acceptance or the outstanding
principal amount of Indebtedness supported or secured, but not both, will
be considered Indebtedness hereunder;
(c) all obligations of such Person as lessee under leases which have
been or should be, in accordance with GAAP, recorded as Capitalized Lease
Liabilities;
(d) all other items other than deferred taxes, deferred revenue and
deferred leases which, in accordance with GAAP, would be included as
liabilities on the liability side of the balance sheet of such Person as of
the date at which Indebtedness is to be determined;
(e) net liabilities of such Person under all Hedging Obligations;
(f) whether or not so included as liabilities in accordance with
GAAP, all net obligations of such Person to pay the deferred purchase price
of property or services (excluding accounts payable incurred in the
ordinary course of business), and indebtedness (excluding prepaid interest
thereon) secured by a Lien on property owned or being purchased by such
Person (including indebtedness arising under conditional sales or other
title retention agreements), whether or not such indebtedness shall have
been assumed by such Person or is limited in recourse, but excluding any
royalties or similar payments to be made by such Person which are based on
production or performance; and
(g) all Contingent Liabilities of such Person in respect of any of
the foregoing.
15
For all purposes of this Agreement, the Indebtedness of any Person shall include
the Indebtedness of any partnership or joint venture in which such Person is a
general partner or a joint venturer, unless the indebtedness of such partnership
or joint venture is expressly nonrecourse to such Person.
"Indemnified Liabilities" is defined in Section 11.4.
"Indemnified Parties" is defined in Section 11.4.
"Interest Coverage Ratio" means, for any period of four Fiscal Quarters,
the ratio of (x) the consolidated EBITDA of the Borrower and its Subsidiaries
during such period to (y) the Consolidated Interest Expense of the Borrower and
its Subsidiaries (excluding from Consolidated Interest Expense for purposes of
this clause (y) interest capitalized in connection with the construction of a
new Facility which interest is capitalized during the construction of such
Facility) incurred during such period. This ratio shall be calculated after
giving pro forma effect to any Acquisition based upon the historical audited
financial statements of the project that was the subject of the Acquisition. It
is agreed that for purposes of clause (f) of Section 8.2.2 only, the Interest
Coverage Ratio shall be calculated in conformity in all respects with the
calculation of "Consolidated Coverage Ratio" under the Xxx-0000 Xxxxxxxxxx.
"Interest Coverage Ratio (Parent Only)" means, for any period of four
Fiscal Quarters, the ratio of (x) the Borrower EBITDA during such period to (y)
the Borrower Interest Expense (excluding from Borrower Interest Expense for
purposes of this clause (y) interest capitalized in connection with the
construction of a new Facility which interest is capitalized during the
construction of such Facility) during such period; provided, however, that if
the Interest Coverage Ratio (Parent Only) as so calculated falls below 1.70 to
1.00, then for purposes of Section 6.3.4, the Interest Coverage Ratio (Parent
Only) shall be calculated as of the end of any calendar month on a rolling
twelve month basis until the Interest Coverage Ratio (Parent Only) equals or
exceeds 1.70 to 1.00, at which time such ratio shall again be tested quarterly.
This ratio shall be calculated after giving pro forma effect to any Acquisition.
"Interest Period" means, relative to any LIBO Rate Loans, the period
beginning on (and including) the date on which such LIBO Rate Loan is made or
continued as, or converted into, a LIBO Rate Loan pursuant to Section 2.3 or 2.4
and ending on (but excluding) the day which numerically corresponds to such date
one, three or six months thereafter (or, if such month has no numerically
corresponding day, on the last Business Day of such month), in each case as the
Borrower may select in its relevant notice pursuant to Section 2.3 or 2.4;
provided, however, that
(a) the Borrower shall not be permitted to select Interest Periods
to be in effect at any one time which have expiration dates occurring on
more than five different dates;
(b) Interest Periods commencing on the same date for Loans
comprising part of the same Borrowing shall be of the same duration;
(c) if such Interest Period would otherwise end on a day which is
not a Business Day, such Interest Period shall end on the next following
Business Day (unless, if such Interest Period applies to LIBO Rate Loans,
such next following Business Day is
16
the first Business Day of a calendar month, in which case such Interest
Period shall end on the Business Day next preceding such numerically
corresponding day); and
(d) no Interest Period may end later than the date set forth in
clause (a) of the definition of "Commitment Termination Date".
"Investment" means, relative to any Person, without duplication,
(a) any loan or advance made by such Person to any other Person
(excluding commission, travel and similar advances to officers and
employees made in the ordinary course of business and prepaid expenses);
(b) any Contingent Liability of such Person; and
(c) any ownership or similar interest held by such Person in any
other Person.
The amount of any Investment shall be the original principal or capital amount
thereof less all returns of principal or equity thereon (and without adjustment
by reason of the financial condition of such other Person) and shall, if made by
the transfer or exchange of property other than cash, be deemed to have been
made in an original principal or capital amount equal to the fair market value
of such property.
"Investment Joint Venture" means, with respect to any Person, any
corporation, partnership or other Person of which 25% or more of the outstanding
capital stock or other comparable ownership interest having ordinary voting
power to elect not less than 25% of the board of directors of such corporation
(irrespective or whether at the time capital stock of any other class or classes
of such corporation shall or might have voting power upon the occurrence of any
contingency) is at the time directly or indirectly owned by such Person, by such
Person and one or more other Subsidiaries of such Person, or by one or more
other Subsidiaries of such Person.
"Issuance Request" means a request and certificate duly executed by the
chief executive, accounting or financial Authorized Officer of the Borrower, in
substantially the form of Exhibit D (with such changes thereto as may be agreed
upon from time to time by the Agent and the Borrower), together with a properly
completed application for a Letter of Credit on an Issuer's standard form,
executed by an Authorized Officer of the Borrower. In the event of a conflict
between the terms of an application for a Letter of Credit and the terms of this
Agreement, the terms of this Agreement shall prevail.
"Issuer" means BayernLB, so long as the Letter of Credit Outstandings in
respect of Letters of Credit issued by BayernLB and any Affiliate thereof do
not exceed $700,000,000 in the aggregate immediately after any such issuance
(or such greater amount as may be agreed by BayernLB and the Borrower), Bankers
Trust Company, so long as the Letter of Credit Outstandings in respect of
Letters of Credit issued by Bankers Trust Company and any Affiliate thereof do
not exceed $300,000,000 in the aggregate immediately after any such issuance
(or such greater amount as may be agreed by Bankers Trust Company and the
Borrower), or any Affiliate, unit of agency of any of the foregoing, any other
Lender acceptable to the Borrower and the Agent, and any successor to any of
the foregoing Persons.
17
"Joint Venture" means, with respect to any Person, any corporation,
partnership or other Person of which 50% of the outstanding capital stock or
other comparable ownership interest having ordinary voting power to elect not
less than 50% of the board of directors of such corporation (irrespective or
whether at the time capital stock of any other class or classes of such
corporation shall or might have voting power upon the occurrence of any
contingency) is at the time directly or indirectly owned by such Person, by such
Person and one or more other Subsidiaries of such Person, or by one or more
other Subsidiaries of such Person.
"JOQ" means JOQ Canada, Inc., a Delaware corporation and indirect, Wholly
Owned Subsidiary of CNGH.
"knowledge" or "to the Borrower's knowledge" means the knowledge of or to
the knowledge of the president, any vice president, the general counsel, the
secretary, the chief financial officer, the controller or the vice
president-finance of the Borrower.
"L/C Advance" is defined in Section 4.5.
"Lender Assignment Agreement" means a Lender Assignment Agreement
substantially in the form of Exhibit E.
"Lenders" is defined in the preamble.
"Letter of Credit" is defined in Section 4.1.
"Letter of Credit Outstandings" means, at any time, an amount equal to the
sum of (a) the aggregate Stated Amount at such time of all Letters of Credit
then outstanding and undrawn (as such aggregate Stated Amount shall be adjusted,
from time to time, as a result of drawings, the issuance of Letters of Credit,
or otherwise) after converting the aggregate Stated Amounts of all Foreign
Currency Letters of Credit to the Equivalent Amount thereof, plus (b) the then
aggregate amount of all unpaid and outstanding Reimbursement Obligations (after
converting the aggregate Reimbursement Obligations with respect to Disbursements
made in either Canadian Dollars or Sterling to the Equivalent Amount thereof).
"Leverage Ratio" means the ratio of (a) Debt to (b) Debt plus Tangible Net
Worth.
"LIBO Rate" is defined in Section 3.2.1.
"LIBO Rate Loan" means a Loan bearing interest, at all times during an
Interest Period applicable to such Loan, at a fixed rate of interest determined
by reference to the LIBO Rate (Reserve Adjusted).
"LIBO Rate (Reserve Adjusted)" is defined in Section 3.2.1.
"LIBOR Office" means, relative to any Lender, the office of such Lender
designated as such below its signature hereto or designated in the Lender
Assignment Agreement or such other office of a Lender (or any successor or
assign of such Lender) as designated from time to time by notice from such
Lender to the Borrower and the Agent, whether or not outside the United States,
which shall be making or maintaining LIBO Rate Loans of such Lender hereunder.
18
"LIBOR Reserve Percentage" is defined in Section 3.2.1.
"Lien" means any security interest, mortgage, pledge, hypothecation,
assignment for security, deposit arrangement, encumbrance, lien (statutory or
otherwise), charge against or interest in property to secure payment of a debt
or performance of an obligation or other priority or preferential arrangement of
any kind or nature whatsoever.
"Loan" means, as the context may require, either a Term B Loan or a
Revolving Loan.
"Loan Document" means this Agreement, the Notes, the Pledge Agreements,
the Guaranty, the Deeds of Trust, the Assignment Agreement, the Hazardous
Materials Indemnity, the Fee Letter, and each other relevant agreement, document
or instrument delivered in connection therewith.
"Material Adverse Effect" means (a) a material adverse change in, or a
material adverse effect upon, the financial condition, operations, assets
(including power projects), business or prospects of the Borrower and its
Significant Subsidiaries taken as a whole; or (b) a material adverse change in
the ability of the Borrower or any other Obligor to perform under any Loan
Document.
"Monthly Payment Date" means the last day of each calendar month or, if
any such day is not a Business Day, the next succeeding Business Day.
"Xxxxx'x" is defined in the definition of the term "Borrower's Credit
Rating".
"Net Available Cash" means, (a) with respect to any Asset Sale, the
cash or cash equivalent payments received by the Borrower or any of its
Subsidiaries in connection with such Asset Sale (including any cash received by
way of deferred payment of principal pursuant to a note or installment
receivable or otherwise, but only as or when received and also including the
proceeds of other property received when converted to cash or cash equivalents)
net of the sum of, without duplication, (i) all reasonable legal, title and
recording tax expenses, reasonable commissions, and other reasonable fees and
expenses incurred directly relating to such Asset Sale, (ii) all local, state,
federal and foreign taxes required to be paid or accrued as a liability by the
Borrower or any of its Subsidiaries as a consequence of such Asset Sale, (iii)
payments made to repay Indebtedness which is secured by any assets subject to
such Asset Sale in accordance with the terms of any Lien upon or other security
agreement of any kind with respect to such assets, or which must by its terms,
or by applicable law, be repaid out of the proceeds from such Asset Sale and
(iv) all distributions required by any contract entered into other than in
contemplation of such Asset Sale to be paid to any holder of a minority equity
interest in such Subsidiary as a result of such Asset Sale, so long as such
distributions do not exceed such minority holder's pro rata portion (based on
such minority holder's proportionate equity interest) of the cash or cash
equivalent payments described above, net of the amounts set forth in clauses
(i)-(iii) above and (b) all cash insurance proceeds received by the Borrower or
any of its Subsidiaries from any condemnation awards or casualty losses in
respect of any of the Dedicated Assets, net of all payments made to repay
Indebtedness which is secured by the assets which were the subject of such
condemnation or casualty; provided, however, so long as no Event of Default
shall have occurred and be continuing, upon the Borrower's request within ninety
days
19
after the date of such occurrence, such proceeds shall be retained by the
Borrower or such Subsidiary or delivered to the Borrower or such Subsidiary to
repair or replace the property subject to such casualty so long as the Borrower
or such Subsidiary has undertaken and is diligently pursuing the repair of such
property; provided, however, that if such repairs cease or if, after such
repairs are completed, the Borrower or such Subsidiary retains any of such
proceeds, such proceeds shall thereupon be applied as provided in Section 2.2.2.
"Net Equity Proceeds" means, with respect to any issuance by the Borrower
or a Trust of any equity securities (including the Guaranteed Preferred
Securities), the gross consideration received by or for the account of the
issuer minus underwriting and brokerage commissions, discounts and fees
relating to such issuance that are payable by the issuer.
"New Lender" is defined in Section 2.7.
"Nonmaterial Subsidiary Default" means any Default (excluding any Event
of Default) arising or resulting from the default or potential default by a
Subsidiary (other than a Significant Subsidiary) under any obligation or
condition under Section 8.1 of this Agreement (but not any other Section of this
Agreement) or under any other agreement, contract or undertaking binding on such
Subsidiary other than (i) the failure by such Subsidiary to make a required
payment under any Indebtedness of such Subsidiary having a principal amount in
excess of $10,000,000 and (ii) a default in the performance or observance of any
obligation or condition with respect to any Indebtedness of such Subsidiary
having a principal amount in excess of $10,000,000 and, as a result thereof, the
holder or holders of such Indebtedness, or any trustee or agent for such
holders, causes such Indebtedness to be repaid more quickly than theretofore
scheduled, whether through the introduction of a "cash sweep," the increase of
an existing "cash sweep" or otherwise.
"Note" means, as the context may require, either a Revolving Note or a
Term Note.
"Notes" means the Revolving Notes and the Term Notes.
"Obligations" means all obligations (monetary or otherwise) of the Borrower
and each other Obligor arising under or in connection with this Agreement, the
Notes and each other Loan Document.
"Obligor" means the Borrower, each Guarantor or any other Person (other
than the Agent or any Lender) obligated under, or otherwise a party to, any Loan
Document.
"Organic Document" means, relative to any Obligor, its certificate of
incorporation, partnership agreement, or similar organizational document, its
by-laws and all shareholder agreements, voting trusts and similar arrangements
applicable to any of its authorized shares of capital stock or other ownership
interests.
"Participant" is defined in Section 11.11.2.
"PBGC" means the Pension Benefit Guaranty Corporation and any entity
succeeding to any or all of its functions under ERISA.
20
"Pension Plan" means a "pension plan", as such term is defined in section
3(2) of ERISA, which is subject to Title IV of ERISA (other than a
multiemployer plan as defined in section 4001(a)(3) of ERISA), and to which the
Borrower or any corporation, trade or business that is, along with the
Borrower, a member of a Controlled Group, may have liability, including any
liability by reason of having been a substantial employer within the meaning of
section 4063 of ERISA at any time during the preceding five years, or by reason
of being deemed to be a contributing sponsor under section 4069 of ERISA.
"Percentage" means, as the context may require, a Lender's Revolving
Percentage, Term Percentage or Aggregate Percentage.
"Person" means any natural person, corporation, partnership, limited
liability company, firm, association, trust, government, governmental agency or
any other entity, whether acting in an individual, fiduciary or other capacity.
"Plan" means any Pension Plan or Welfare Plan.
"Pledge Agreements" means the pledge agreements executed and delivered
pursuant to Section 6.1.4, as such agreements may be amended, supplemented,
restated or otherwise modified from time to time, which will be in substantially
the form of Exhibit I hereto and which will cover all equity interests in
Calpine Holdings, CNGGP and CNGH held by the Borrower and all of the equity
interests of QCH in CCEC and such portion of the equity interests of QM and JOQ
in CCEC sufficient to pledge to the Agent an aggregate amount of 65% of the
total equity interests of CCEC.
"Pre-2000 Indentures" means the Senior Note Indentures other than the
Shelf Indenture and the Zero-Coupon Indenture.
"pro forma" or "pro forma basis" means, for any period, that if the
Borrower or any Subsidiary shall have made any acquisition or disposition of
assets or capital stock (occurring by merger or otherwise) since the beginning
of such period (including any acquisition or disposition of assets or capital
stock occurring in connection with a transaction causing a calculation to be
made hereunder), subject to the qualifications set forth in the definitions
thereof, the Interest Coverage Ratio and Interest Coverage Ratio (Parent Only)
calculated for such period shall be calculated after giving pro forma effect to
such acquisition or disposition, based upon the historical audited financial
statements covering the assets or stock so acquired or disposed.
"QCH" means Xxxxxxxx Canada Holdings, LLC, a Delaware limited liability
company and indirect, Wholly Owned Subsidiary of CNGH.
"QM" means Xxxxxxxx Minerals (USA), Inc., a Delaware corporation and
indirect, Wholly Owned Subsidiary of CNGH.
"Quarterly Payment Date" means the last day of each March, June, September,
and December or, if any such day is not a Business Day, the next succeeding
Business Day.
"Reimbursement Obligation" is defined in Section 4.6.
21
"Release" means a "release", as such term is defined in CERCLA.
"Required Lenders" means, at any time, Lenders owed or holding (a) if the
Revolving Loan Commitments shall not have been terminated, at least 51% of the
aggregate of all Term B Loans and Revolving Loan Commitments then outstanding
or (b) if the Revolving Loan Commitments shall have been terminated, at least
51% of the aggregate amount of all Loans and L/C Advances then outstanding.
"Required Revolving Lenders" means, at any time, Revolving Lenders having
Revolving Percentages aggregating at least 51%.
"Required Term B Lenders" means, at any time, Term B Lenders owed or
holding (a) if the Term B Loan Commitments shall not have been terminated, at
least 51% of the Term Percentages or (b) if the Term B Loan Commitments shall
have been terminated, at least 51% of the aggregate amount of all Term B Loans
then outstanding.
"Reset Date" is defined in Section 4.12.
"Resource Conservation and Recovery Act" means the Resource Conservation
and Recovery Act, 42 U.S.C. Section 6901, et seq., as in effect from time to
time.
"Restricted Subsidiary" has the meaning given in the Xxx-0000 Xxxxxxxxxx.
"Revolving Commitment Amount" means, on any date, $1,000,000,000, as such
amount may be reduced from time to time pursuant to Section 2.2 or increased
pursuant to Section 2.7.
"Revolving Commitment Availability" means, on any date, the excess of (a)
the then Revolving Commitment Amount, over (b) the sum of (i) the outstanding
principal amount of all Revolving Loans on such date plus (ii) the Letter of
Credit Outstandings on such date.
"Revolving Lead Arrangers" means Scotiabank, BayernLB, Deutsche, CSFB, CUSA
and Bank of America, National Association.
"Revolving Lender" means each Lender that holds a Revolving Loan Commitment
or a Revolving Loan.
"Revolving Loan" means each Loan made by the Revolving Lenders pursuant to
the Revolving Loan Commitment.
"Revolving Loan Commitment" is defined in Section 2.1.2.
"Revolving Loan Commitment Termination Date" means the earliest of
(a) May 24, 2003;
(b) the date on which the Revolving Loan Commitments of the
Revolving Lenders are terminated in full or reduced to zero pursuant to
Section 2.2; and
(c) the date on which any Commitment Termination Event occurs.
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Upon the occurrence of any event described in clause (b) or (c), the Revolving
Loan Commitments shall terminate automatically and without any further action.
"Revolving Note" means a promissory note of the Borrower payable to the
order of any Revolving Lender, in the form of Exhibit A-1 (as such promissory
note may be amended, endorsed or otherwise modified from time to time),
evidencing the aggregate Indebtedness of the Borrower to such Revolving Lender
resulting from its outstanding Revolving Loans and L/C Advances, and also means
all other promissory notes accepted from time to time in substitution therefor
or renewal thereof.
"Revolving Percentage" means, relative to any Revolving Lender, the
percentage set forth opposite its name on Schedule II under the caption
"Revolving Percentage" or as set forth in its Lender Assignment Agreement, as
such percentage may be adjusted from time to time pursuant to Section 2.7 or
pursuant to Lender Assignment Agreement(s) executed by such Lender and its
Assignee Lender(s) and delivered pursuant to Section 11.11. After the Revolving
Loan Commitment Termination Date, relative to any Revolving Lender, at any time,
such Revolving Lender's "Revolving Percentage" shall be as in effect immediately
prior to the Revolving Commitment Termination Date and after giving effect to
any Lender Assignment Agreement(s) of such Lender executed by such Lender and
its Assignee Lender(s) and delivered pursuant to Section 11.11 at or prior to
such time.
"S&P" is defined in the definition of the term "Borrower's Credit Rating".
"Sale/Leaseback Transaction" means an arrangement relating to property now
owned or hereafter acquired whereby the Borrower or a Subsidiary transfers such
property to a Person and leases it back from such Person, other than leases for
a term of not more than 36 months or between the Borrower and a Wholly Owned
Subsidiary or between Wholly Owned Subsidiaries. "Sale/Leaseback Transactions"
shall not include any arrangements or transactions constituting Capitalized
Lease Liabilities.
"Scotiabank" is defined in the preamble.
"Senior Note Indentures" means, collectively, the 7 3/4% Senior Note
Indenture, the 7 5/8% Senior Note Indenture, the 7 7/8% Senior Note Indenture,
the 8 3/4% Senior Note Indenture, the Shelf Indenture (to the extent relating
solely to the Senior Notes), the 10 1/2% Senior Note Indenture and the Zero
Coupon Indenture.
"Senior Notes" means, collectively, the 7 3/4% Senior Notes, the 7 5/8%
Senior Notes, the 7 7/8% Senior Notes, the 8 1/4% Senior Notes, the 8 1/2%
Senior Notes, the 8 3/4% Senior Notes, the 8 5/8% Senior Notes, the 10 1/2%
Senior Notes, the Convertible Senior Notes and the Zero-Coupon Debentures.
"7 5/8% Senior Note Indenture" means that certain Indenture dated as of
March 29, 1999, as supplemented by the First Supplemental Indenture dated as of
July 31, 2000, between the Borrower and The Bank of New York, as Trustee.
"7 5/8% Senior Notes" means the $250,000,000 of 7 5/8% Senior Notes due
2006 issued by the Borrower pursuant to the 7 5/8% Senior Note Indenture.
23
"7 7/8% Senior Note Indenture" means that certain Indenture dated as of
March 31, 1998, as supplemented by the First Supplemental Indenture dated as of
July 24, 1998 and the Second Supplemental Indenture dated as of July 31, 2000,
between the Borrower and The Bank of New York, as Trustee.
"7 7/8% Senior Notes" means the $400,000,000 of 7 7/8% Senior Notes due
2008 issued by the Borrower pursuant to the 7 7/8% Senior Note Indenture.
"7 3/4% Senior Note Indenture" means that certain Indenture dated as of
March 29, 1999, as supplemented by the First Supplemental Indenture dated as of
July 31, 2000, between the Borrower and The Bank of New York, as Trustee.
"7 3/4% Senior Notes" means the $350,000,000 of 7 3/4% Senior Notes due
2009 issued by the Borrower pursuant to the 7 3/4% Senior Note Indenture.
"Shelf Indenture" means that certain Indenture dated as of August 10,
2000, as supplemented from time to time, between the Borrower and Wilmington
Trust Company, as Trustee.
"Significant Subsidiary" means each Subsidiary of the Borrower that
(a) accounted for at least 10% of consolidated revenues of the
Borrower and its Subsidiaries or 10% of consolidated earnings of the
Borrower and its Subsidiaries before interest and taxes, in each case for
the last four full Fiscal Quarters immediately preceding the date as of
which any such determination is made; or
(b) has assets which represent at least 10% of the consolidated
assets of the Borrower and its Subsidiaries as of the last day of the
last Fiscal Quarter of the Borrower immediately preceding the date as of
which any such determination is made,
all of which shall be as reflected on the financial statements of the Borrower
for the period, or as of the date, in question.
"Solvency Certificates" means the solvency certificates to be executed
and delivered to the Agent for the benefit of the Lenders by the chief financial
officer or an Authorized Representative of each of CCEC, CCEF and QCH in a form
reasonably acceptable to the Agent.
"Solvent" means, as to any Person at any time, that (i) the fair value of
the property of such Person is greater than the amount of such Person's
liabilities (whether subordinated, contingent, unmatured, unliquidated or
otherwise); (ii) the present fair saleable value of the property of such Person
is not less than the amount that will be required to pay the probable liability
of such Person on its debts as they become absolute and matured; (iii) such
Person is able to pay its debts and other liabilities as they mature in the
normal course of business; (iv) such Person does not intend to, and does not
believe that it will, incur debts or liabilities beyond such Person's ability
to pay as such debts and liabilities mature; and (v) such Person is not engaged
in business or a transaction, and is not about to engage in business or a
transaction, for which such Person's property would constitute unreasonably
small capital.
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"Special Purpose Subsidiary" is defined in Section 8.2.2(e).
"Stated Amount" of each Letter of Credit means the "Stated Amount" as
defined therein.
"Stated Expiry Date" is defined in Section 4.1(b).
"Stated Maturity Date" means, in the case of Revolving Loans, May 24,
2003 and, in the case of Term B Loans, the 24 month anniversary of the date of
the Borrowing thereof (or if the Term B Loans are not borrowed, of the date
hereof).
"Sterling" and the sign "[pound]"shall mean freely transferable lawful
money of the United Kingdom.
"Subordinated Debt" means all unsecured Indebtedness of the Borrower for
money borrowed which is subordinated, upon terms satisfactory to the Agent and
the Required Lenders, in right of payment to the payment in full in cash of all
Obligations.
"Subsidiary" means, with respect to any Person, any corporation,
partnership or other Person of which at least 50% of the outstanding capital
stock or other comparable ownership interest having ordinary voting power to
elect a majority of the board of directors of such corporation, partnership or
other Person (irrespective of whether at the time capital stock of any other
class or classes of such corporation, partnership or other Person shall or might
have voting power upon the occurrence of any contingency) is at the time
directly or indirectly owned by such Person, by such Person and one or more
other Subsidiaries of such Person, or by one or more other Subsidiaries of such
Person.
"Tangible Net Worth" means the consolidated net worth of the Borrower and
its Subsidiaries, including the aggregate outstanding face amount of the
Guaranteed Preferred Securities, after subtracting therefrom the aggregate
amount of any intangible assets of the Borrower and its Subsidiaries, including
goodwill, franchises, licenses, patents, trademarks, trade names, copyrights,
service marks and brand names.
"Taxes" is defined in Section 5.6.
"10 1/2% Senior Note Indenture" means that certain Indenture dated as of
May 16, 1996, as supplemented by the First Supplemental Indenture dated as of
August 1, 2000, between Borrower and State Street Bank and Trust Company (as
successor trustee to Fleet National Bank), as Trustee.
"10 1/2% Senior Notes" means the $180,000,000 of 10 1/2% Senior Notes due
2006 issued by the Borrower pursuant to the 10 1/2% Senior Note Indenture.
"Term B Lead Arrangers" means Xxxxxxx Xxxxx Xxxxxx Inc. and/or CUSA,
Deutsche and CSFB.
"Term B Lender" means each Lender that holds a Term B Loan Commitment or
a Term B Loan.
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"Term B Loan" is defined in Section 2.1.1.
"Term B Loan Commitment" is defined in Section 2.1.1.
"Term B Loan Commitment Amount" means, on any date, $600,000,000, as such
amount may be reduced from time to time pursuant to Section 2.2 or increased
pursuant to Section 2.8.
"Term B Loan Commitment Termination Date" means the earliest of
(a) June 8, 2002;
(b) the date of the initial Borrowing of Term B Loans;
(c) the date on which the Term B Loan Commitments of the Term B
Lenders are terminated in full or reduced to zero in accordance with
Section 2.2; and
(d) the date on which any Commitment Termination Event occurs.
Upon the occurrence of any event described above, the Term B Loan
Commitments shall terminate automatically and without any further action.
"Term Note" means a promissory note of the Borrower payable to the order
of any Term B Lender, in the form of Exhibit A-2 hereto (as such promissory
note may be amended, endorsed or otherwise modified from time to time),
evidencing the aggregate Indebtedness of the Borrower to such Term B Lender
resulting from its outstanding Term B Loan, and also means all other promissory
notes accepted from time to time in substitution therefor or renewal thereof.
"Term Percentage" means, relative to any Term B Lender, the percentage set
forth opposite its name on Schedule II under the caption "Term Percentage" or
as set forth in its Lender Assignment Agreement, as such percentage may be
adjusted from time to time pursuant to Section 2.8 or pursuant to Lender
Assignment Agreement(s) executed by such Lender and its Assignee Lender(s) and
delivered pursuant to Section 11.11.
"Trust" means Calpine Capital Trust, Calpine Capital Trust II and Calpine
Capital Trust III, each a Delaware business trust.
"type" means, relative to any Loan, the portion thereof, if any, being
maintained as a Base Rate Loan or a LIBO Rate Loan.
"United States" or "U.S." means the United States of America, its fifty
States and the District of Columbia.
"U.S. Dollars" and the sign "$" shall each mean freely transferable lawful
money of the United States of America.
"Welfare Plan" means a "welfare plan", as such term is defined in section
3(1) of ERISA.
"Wholly Owned Subsidiary" means a Subsidiary all the capital stock of which
(other than directors' qualifying shares) is owned by the Borrower or another
Wholly Owned Subsidiary.
26
"Zero-Coupon Debentures" means the outstanding Zero-Coupon Convertible
Debentures due 2021 issued by the Borrower pursuant to the Zero-Coupon
Indenture.
"Zero-Coupon Indenture" means that certain Indenture dated as of April 30,
2001 between the Borrower and Wilmington Trust Company as Trustee.
SECTION 1.2. Use of Defined Terms. Unless otherwise defined or the
context otherwise requires, terms for which meanings are provided in this
Agreement shall have such meanings when used in the Disclosure Schedule and in
each Note, Borrowing Request, Continuation/Conversion Notice, Loan Document,
notice and other communication delivered from time to time in connection with
this Agreement or any other Loan Document.
SECTION 1.3. Cross-References. Unless otherwise specified, references in
this Agreement and in each other Loan Document to any Article or Section are
references to such Article or Section of this Agreement or such other Loan
Document, as the case may be, and, unless otherwise specified, references in
any Article, Section or definition to any clause are references to such clause
of such Article, Section or definition.
SECTION 1.4. Accounting and Financial Determinations. Unless otherwise
specified, all accounting terms used herein or in any other Loan Document shall
be interpreted, all accounting determinations and computations hereunder or
thereunder (including under Section 8.2.4) shall be made, and all financial
statements required /to be delivered hereunder or thereunder shall be prepared
in accordance with, generally accepted accounting principles ("GAAP") in effect
in the United States from time to time.
ARTICLE II
COMMITMENTS, BORROWING PROCEDURES AND NOTES
SECTION 2.1. Commitments. On the terms and subject to the conditions of
this Agreement (including Article VI), each Lender severally agrees to make
Loans pursuant to the Commitments described in this Section 2.1.
SECTION 2.1.1. Term B Loan Commitment. On a date prior to the Term B Loan
Commitment Termination Date, each Term B Lender severally will make loans in
U.S. Dollars (relative to such Lender, its "Term B Loan") to the Borrower equal
to such Lender's Term Percentage of the aggregate amount of the Borrowing of
Term B Loans requested by the Borrower to be made on such day. The Commitment of
each Term B Lender described in this Section 2.1.1 is herein referred to as its
"Term B Loan Commitment". On the date of the initial Borrowing of Term B Loans
hereunder, the Term B Loan Commitment shall terminate, and any portion of the
Term B Loan Commitment Amount that is not borrowed on such date shall be
extinguished. No amounts paid or prepaid with respect to Term B Loans may be
reborrowed.
SECTION 2.1.2. Revolving Loan Commitment. From time to time on any
Business Day occurring prior to the Revolving Loan Commitment Termination Date,
each Revolving Lender severally will make loans in U.S. Dollars (relative to
such Lender, its "Revolving Loans") to the Borrower equal to such Lender's
Revolving Percentage of the aggregate amount of the Borrowing of Revolving
Loans requested by the Borrower to be made on such day. On the terms
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and subject to the conditions hereof, the Borrower may from time to time
borrow, prepay and reborrow Revolving Loans.
SECTION 2.1.3. Commitment to Issue Letters of Credit. From time to time
on any Business Day, an Issuer will issue, and each Revolving Lender will
participate in, the Letters of Credit, in accordance with Article IV.
SECTION 2.1.4. Lenders Not Permitted or Required To Make Loans or Issue
or Participate in Letters of Credit Under Certain Circumstances. No Lender or
Issuer, as the case may be, shall be permitted or required to
(a) make its Term B Loan if, after giving effect thereto,
(i) the aggregate outstanding principal amount of all Term B
Loans of all Lenders would exceed the Term B Loan Commitment Amount,
or
(ii) the aggregate outstanding principal amount of the Term B
Loans of such Lender would exceed such Lender's Term Percentage of
the Term B Loan Commitment Amount;
(b) make any Revolving Loan if, after giving effect thereto,
(i) the aggregate outstanding principal amount of all
Revolving Loans of all Lenders, together with all Letter of Credit
Outstandings, would exceed the Revolving Commitment Amount, or
(ii) the aggregate outstanding principal amount of all
Revolving Loans of such Lender, together with its Revolving Percentage of
all Letter of Credit Outstandings, would exceed such Lender's Revolving
Percentage of the Revolving Commitment Amount; or
(c) issue (in the case of an Issuer) or participate in (in the case
of each Revolving Lender) any Letter of Credit prior to the Revolving Loan
Commitment Termination Date, if, after giving effect thereto
(i) all Letter of Credit Outstandings together with the
aggregate outstanding principal amount of all Revolving Loans of all
Lenders would exceed the Revolving Commitment Amount,
(ii) in the case of the issuance of any Foreign Currency Letter
of Credit, the Equivalent Amount of all Foreign Currency Letter of Credit
Outstandings would exceed the Foreign Currency Letter of Credit Commitment
Amount, or
(iii) such Lender's Revolving Percentage of all Letter of
Credit Outstandings together with the aggregate outstanding principal
amount of all Revolving Loans of such Lender would exceed such Lender's
Revolving Percentage of the Revolving Commitment Amount.
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SECTION 2.2. Reduction of Commitment Amounts. The Commitment Amounts
are subject to reduction from time to time pursuant to this Section 2.2.
SECTION 2.2.1. Optional Reduction. The Borrower may, from time to time
on any Business Day voluntarily reduce any Commitment Amount; provided,
however, that all such reductions shall require at least three Business Days'
prior notice to the Agent and be permanent reductions of such Commitment
Amount, and any partial reduction of any Commitment Amount shall be in a
minimum amount of $2,000,000 and in an integral multiple of $500,000.
SECTION 2.2.2. Mandatory Reductions.
(a) There shall be a mandatory reduction of the Term B Loan
Commitment Amount, the Revolving Commitment Amount and the commitments
under the Existing Credit Agreement by an amount equal to one hundred
percent (100%) of Net Available Cash from any Asset Sale of any Dedicated
Assets; provided, however, that the Borrower may, at its discretion retain
(and, as a consequence of such retention, these shall be excluded from such
mandatory reduction) up to an aggregate of $75,000,000 of such Net
Available Cash so long as such Net Available Cash is applied by the
Borrower in accordance with Section 8.2.10(b) hereof.
(b) Upon the conversion of any non-cash proceeds realized from any
transaction described in clause (a) above (whether received by the Borrower
or any Subsidiary) to cash, the principal amount of such proceeds and any
interest attributable thereto shall be deemed to be Net Available Cash and
applied by the Agent as hereinafter provided.
(c) Any reduction of the Commitment Amounts described in clauses (a)
and (b) shall be effective on the first Business Day following the
Borrower's receipt of any related Net Available Cash. All such amounts
shall be applied to the ratable reduction of the Term B Loan Commitment
Amount, the Revolving Commitment Amount and the commitments under the
Existing Credit Agreement. To that end, such amounts shall first be applied
to ratably prepay the Term B Loans, Revolving Loans and the loans under
the Existing Credit Agreement, and the corresponding cancellation of the
Revolving Commitment Amount and the commitments under the Existing Credit
Agreement by the respective amount of such prepayments and to the
cancellation of the unused portion of the Revolving Commitment Amount and
the commitments under the Existing Credit Agreement and finally to ratably
cash collaterize outstanding Letter of Credit and letters of credit under
the Existing Credit Agreement.
(d) To the extent that prior to the Revolving Loan Commitment
Termination Date the Revolving Commitment Amount is less than the aggregate
amount of the Letter of Credit Outstandings and Revolving Loans on any date
prior to the Revolving Loan Commitment Termination Date, then the Borrower
must deposit with the Agent cash collateral in accordance with Section 4.7
hereof.
(e) Notwithstanding anything to the contrary in this Section 2.2.2
(but subject to the terms of Section 2.2.3), if the Term B Lead Arrangers
shall demand a mandatory
29
prepayment of the Term B Loans pursuant to the terms of the Fee Letter,
all Term B Loans shall be due and payable, and any payment in respect
thereof shall be applied as a mandatory reduction of the Term B Loan
Commitment Amount.
SECTION 2.2.3. Post Default Application. After the occurrence and during
the continuance of an Event of Default, all optional and mandatory reductions
of Commitment Amounts under Section 2.2.1 and Section 2.2.2 shall be applied to
the pro rata reduction of all outstanding Revolving Loans, Term B Loans and
outstanding loans under the Existing Credit Agreement and the
cash-collateralization of any letters of credit outstanding under the Existing
Credit Agreement and any Letters of Credit outstanding hereunder.
SECTION 2.3. Borrowing Procedure. By delivering a Borrowing Request to
the Agent on or before 10:00 a.m., San Francisco time, on a Business Day, an
Authorized Officer of the Borrower may from time to time irrevocably request,
on not less than three days, in the case of LIBO Rate Loans, or one day in the
case of Base Rate Loans, nor more than five Business Days' notice, that a
Borrowing be made in a minimum amount of $2,000,000 or in the unused amount of
the applicable Commitment. The Agent shall promptly transmit the information in
the Borrower's request to each applicable Lender. On the terms and subject to
the conditions of this Agreement, each Borrowing shall be comprised of the type
of Loans, and shall be made on the Business Day, specified in such Borrowing
Request. On or before 11:00 a.m. (San Francisco time) on the Business Day
specified in such Borrowing Request each applicable Lender shall deposit with
the Agent same day funds in an amount equal to such Lender's applicable
Percentage of the requested Borrowing. Such deposit will be made to an account
which the Agent shall specify from time to time by notice to the Lenders. To
the extent funds are received from the applicable Lenders, the Agent shall make
such funds available to the Borrower by wire transfer to the accounts the
Borrower shall have specified in its Borrowing Request. No Lender's obligation
to make any Loan or L/C Advance shall be affected by any other Lender's failure
to make any Loan or L/C Advance.
SECTION 2.4. Continuation and Conversion Elections. By delivering a
Continuation/Conversion Notice to the Agent on or before 10:00 a.m., San
Francisco time, on a Business Day, an Authorized Officer of the Borrower may
from time to time irrevocably elect, on not less than three nor more than five
Business Days' notice that all, or any portion in an aggregate minimum amount of
$2,000,000 of any Loans be, in the case of Base Rate Loans, converted into LIBO
Rate Loans or, in the case of LIBO Rate Loans, be converted into a Base Rate
Loan or continued as a LIBO Rate Loan (in the absence of delivery of a
Continuation/ Conversion Notice with respect to any LIBO Rate Loan at least
three Business Days before the last day of the then current Interest Period with
respect thereto, such LIBO Rate Loan shall, on such last day, automatically
convert to a Base Rate Loan); provided, however, that (i) each such conversion
or continuation shall be pro rated among the applicable outstanding Loans of all
Lenders, and (ii) no portion of the outstanding principal amount of any Loans
may be continued as, or be converted into, LIBO Rate Loans when any Default has
occurred and is continuing. The Agent shall promptly transmit the information in
each Continuation/Conversion Notice to each Lender.
SECTION 2.5. Funding. Each Lender may, if it so elects, fulfill its
obligation to make, continue or convert LIBO Rate Loans hereunder by causing
one of its foreign branches or
30
Affiliates (or an international banking facility created by such Lender) to
make or maintain such LIBO Rate Loan; provided, however, that such LIBO Rate
Loan shall nonetheless be deemed to have been made and to be held by such
Lender, and the obligation of the Borrower to repay such LIBO Rate Loan shall
nevertheless be to such Lender for the account of such foreign branch,
Affiliate or international banking facility; provided, further, that each
Lender shall use reasonable efforts in making any such election to minimize the
costs payable by the Borrower hereunder with respect to any Loan, Commitment or
Letter of Credit. In addition, the Borrower hereby consents and agrees that,
for purposes of any determination to be made for purposes of Section 5.1, 5.2,
5.3 or 5.4, it shall be conclusively assumed that each Lender elected to fund
all LIBO Rate Loans by purchasing Dollar deposits in its LIBOR Office's
interbank eurodollar market.
SECTION 2.6. Notes; Register. Unless the Agent shall have been advised by
a Lender that it does not want to receive a Note, each Lender's Loans under
each of its Commitments shall be evidenced by a Note payable to the order of
such Lender in a maximum principal amount equal to such Lender's applicable
Percentage of the original applicable Commitment Amount. Whether or not a Loan
is evidenced by a Note, the Borrower hereby designates Agent to serve as its
agent, solely for the purposes of this Section, to maintain a register (the
"Register") on which Agent will record the name and address of each Lender, the
Commitments and Loans and each repayment in respect of the principal amount of
the Loans of each Lender from time to time. No payment with respect to the
outstanding principal and interest applicable for each of the Loans shall be
made to any Person other than the Person identified in such Register as the
Lender. Failure to make any such recordation or any errors in such recordation
shall not affect the Borrower's obligations in respect of such Loans. The
entries in the Register shall be conclusive and binding on the Borrower absent
manifest error. Upon reasonable notice and during normal business hours,
representatives of the Borrower may from time to time inspect the Register. The
Borrower hereby irrevocably authorizes each Lender to make (or cause to be
made) appropriate notations on the grid attached to such Lender's Notes (or on
any continuation of such grid), which notations, if made, shall evidence, inter
alia, the date of, the outstanding principal of, and the interest rate and
Interest Period applicable to the Loans and L/C Advances evidenced thereby.
Such notations shall be conclusive and binding on the Borrower absent manifest
error; provided, however, that the failure of any Lender to make any such
notations shall not limit or otherwise affect any Obligations of the Borrower
or any other Obligor.
SECTION 2.7. Increase in Revolving Commitment Amount.
(a) Provided that no Default then exists, the Borrower may, on any
Business Day prior to May 24, 2003, request in writing that the then
effective Revolving Commitment Amount be increased in accordance with the
provisions of this Section. The Borrower may make only one request under
this Section and in no event may the aggregate amount of such increase
exceed $400,000,000. Any request under this Section to increase the
Revolving Commitment Amount shall be submitted by the Borrower to the
Revolving Lead Arrangers, and shall specify the proposed effective date
(which date shall be not less than 5 days after the date of such request)
and the amount of such increase (which shall be in integral multiples of
$1,000,000). No Lender shall have any obligation, express or implied, to
offer to increase its Revolving Loan Commitment. Only the consent of the
Revolving Lead Arrangers and those Lenders that have increased
31
their Revolving Loan Commitments (the "Increasing Lenders") shall be
required for an increase in the Revolving Commitment Amounts pursuant to
this Section.
(b) The Borrower may accept some or all of the offered amounts from
the then-current Lenders or designate new lenders which are reasonably
acceptable to the Revolving Lead Arrangers and each Issuer as additional
Lenders hereunder in accordance with clause (c) of this Section (each, a
"New Lender"), which New Lender may assume all or a portion of the
increase in the Revolving Commitment Amount. The Revolving Lead Arrangers
and the Borrower shall have discretion to adjust the allocation of the
increased Revolving Commitment Amount among Increasing Lenders and New
Lenders.
(c) Each New Lender designated by the Borrower and reasonably
acceptable to the Revolving Lead Arrangers and each Issuer shall become
an additional party hereto as a New Lender concurrently with the
effectiveness of the proposed increase in the Revolving Commitment Amount
upon its execution of an instrument of joinder to this Agreement which is
in form and substance reasonably acceptable to the Revolving Lead
Arrangers and each Issuer and which, in any event, contains the
representations, warranties, indemnities and other protections afforded
to the Revolving Lead Arrangers, the Agent and the other Lenders.
(d) Concurrently with the effectiveness of any increase in the
Revolving Commitment Amount pursuant to this Section 2.7, all obligations
of the Borrower under the Existing Credit Agreement shall be repaid or
otherwise terminated and the commitments of all lenders and letter of
credit issuers thereunder terminated. Subject to the foregoing, any
increase requested by the Borrower shall be effective as of the date
proposed by the Borrower and shall be in the principal amount equal to
(i) the amount which Increasing Lenders are willing to assume as
increases to the amount of their Commitments plus (ii) the amount offered
by any New Lender, in either case as adjusted by the Revolving Lead
Arrangers and the Borrower pursuant to Section 2.7(b). Upon the
effectiveness of any such increase, if requested by a Lender, the
Borrower shall issue replacement Notes to each Increasing Lender and new
Notes to each New Lender, and the applicable Percentages of each Lender
will be adjusted to give effect to the increase in the Revolving
Commitment Amount as set forth in a new Schedule II issued by the Agent.
To the extent that the adjustment of Percentages results in loss or
expenses to any Lender as a result of the prepayment of any LIBO Rate
Loan on a date other than the scheduled last day of the Interest Period
applicable thereto, the Borrower shall be responsible for such loss or
expenses pursuant to Section 5.4.
SECTION 2.8. Increase in Term B Loan Commitment Amount. Provided that no
Default then exists, on any Business Day prior to the Term B Loan Commitment
Termination Date, the Borrower, with the prior written consent of the Term B
Lead Arrangers, may increase the Term B Loan Commitment Amount in accordance
with the provisions of this Section. No Lender shall have any obligation,
express or implied, to offer to increase its Term B Loan Commitment.
Concurrently with the effectiveness of any increase in the Term B Loan
Commitment Amount pursuant to this Section 2.8, there shall be a corresponding
reduction of the Revolving Commitment Amount. Upon the effectiveness of any
such increase, the applicable Percentages of each Lender will be adjusted to
give effect to the increase in the
32
Term B Loan Commitment Amount and corresponding reduction of the Revolving
Commitment Amount as set forth in a new Schedule II issued by the Agent. To the
extent that the adjustment of Percentages results in loss or expenses to any
Lender as a result of the prepayment of any LIBO Rate Loan on a date other than
the scheduled last day of the Interest Period applicable thereto, the Borrower
shall be responsible for such loss or expenses pursuant to Section 5.4.
ARTICLE III
REPAYMENTS, PREPAYMENTS, INTEREST AND FEES
SECTION 3.1. Repayments and Prepayments. The Borrower shall repay in full
the unpaid principal amount of each Loan upon the applicable Stated Maturity
Date therefor.
SECTION 3.1.1. Payment Terms. Prior to the Stated Maturity Date of each
Loan, the Borrower
(a) may, from time to time on any Business Day, make a voluntary
prepayment, in whole or in part, of the outstanding principal amount of
any Loans; provided, however, that
(i) any such prepayment shall be made pro rata among Loans of
the same type and, if applicable, having the same Interest Period,
of all Lenders;
(ii) no such prepayment of any LIBO Rate Loan may be made on
any day other than the last day of the Interest Period for such
Loan, unless the Borrower also pays all losses and expenses (for
which the Borrower has received written notice, including
calculations in reasonable detail) as a result of such prepayment as
provided in Section 5.4;
(iii) all such voluntary prepayments shall require at least
three but no more than five Business Days' prior written notice to
the Agent; and
(iv) all such voluntary partial prepayments shall be in an
aggregate minimum amount of $2,000,000; and
(b) shall, on each date when any reduction in a Commitment Amount
shall become effective, make a mandatory prepayment (which, in the case
of the Revolving Loan Commitment, shall be applied (or held for
application, as the case may be) as set forth in Section 2.2.2(c);
(c) shall, immediately upon any acceleration of the Commitment
Termination Date of any Loans pursuant to Section 9.2 or Section 9.3,
repay all Loans, unless, pursuant to Section 9.3, only a portion of all
Loans is so accelerated;
(d) shall, on each Quarterly Payment Date, deliver cash collateral
to the Agent in an amount equal to the excess, if any, of the sum of (i)
the outstanding principal amount of all Loans plus (ii) all Letter of
Credit Outstandings over the Revolving Commitment Amount;
33
(e) shall, if a Default shall have occurred and be continuing on any
date that the Borrower gives notice of the purchase, redemption or
prepayment of the Zero Coupon Debentures in cash, or if an Event of
Default shall have occurred and be continuing on any date that the
Borrower purchases, redeems or prepays the Zero Coupon Debentures, make a
mandatory prepayment in an amount equal to the outstanding principal
amount of all Revolving Loans then outstanding and deposit with the
Agent, cash collateral in an amount equal to the outstanding Term B Loans
and outstanding Letters of Credit; and
(f) shall, if any non-cash proceeds from any Asset Sale of any
Dedicated Assets shall be received by a Subsidiary that is not directly
or indirectly owned by a Dedicated Subsidiary, thereupon make a mandatory
prepayment, and corresponding reduction of Commitments pursuant to
Section 2.2.2 in an amount equal to the fair market value of such
proceeds, as reasonably determined by the Agent.
Each prepayment of any Loans made pursuant to this Section shall be without
premium or penalty, except as may be required by Section 5.4. No voluntary
prepayment of principal of any Revolving Loans shall cause a reduction in the
Revolving Commitment Amount. No mandatory prepayment of principal of any
Revolving Loans under paragraph (e) shall cause a reduction in the Revolving
Commitment Amount.
SECTION 3.1.2. Post Default Application of Payments. Notwithstanding any
provision of Sections 2.2.2 or 3.1.1 to the contrary, after the occurrence and
during the continuance of an Event of Default, all optional and mandatory
payments under Section 3.1.1 shall be applied first to pay any fees and expenses
then due and owing hereunder and under the Existing Credit Agreement, second to
the pro rata payment of accrued and unpaid interest on all Loans hereunder and
under the Existing Credit Agreement and third as set forth in Section 2.2.2(c).
SECTION 3.2. Interest Provisions. Interest on the outstanding principal
amount of Loans shall accrue and be payable in accordance with this Section 3.2.
SECTION 3.2.1. Rates. Pursuant to an appropriately delivered Borrowing
Request or Continuation/Conversion Notice, the Borrower may elect that Loans
comprising a Borrowing accrue interest at a rate per annum:
(a) on that portion maintained from time to time as a Base Rate
Loan, equal to the sum of the Alternate Base Rate from time to time in
effect plus the Applicable Margin; and
(b) on that portion maintained as a LIBO Rate Loan, during each
Interest Period applicable thereto, equal to the sum of the LIBO Rate
(Reserve Adjusted) for such Interest Period plus the Applicable Margin.
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The "LIBO Rate (Reserve Adjusted)" means, relative to any Loan to be
made, continued or maintained as, or converted into, a LIBO Rate Loan for any
Interest Period, a rate per annum (rounded upwards, if necessary, to the
nearest 1/16 of 1%) determined pursuant to the following formula:
= LIBO Rate
LIBO Rate -------------------------------
(Reserve Adjusted) 1.00 - LIBOR Reserve Percentage
The LIBO Rate (Reserve Adjusted) for any Interest Period for LIBO Rate Loans
will be determined by the Agent on the basis of the LIBOR Reserve Percentage in
effect on, and the applicable rates furnished to and received by the Agent from
Scotiabank, two Business Days before the first day of such Interest Period.
"LIBO Rate" means, relative to any Interest Period for LIBO Rate Loans,
the rate of interest equal to the average (rounded upwards, if necessary, to
the nearest 1/16 of 1%) of the rates per annum at which Dollar deposits in
immediately available funds are offered to Scotiabank's LIBOR Office in the
London interbank market as at or about 11:00 a.m. London time two Business Days
prior to the beginning of such Interest Period for delivery on the first day of
such Interest Period, and in an amount approximately equal to the amount of
Scotiabank's LIBO Rate Loan and for a period approximately equal to such
Interest Period.
"LIBOR Reserve Percentage" means, for each day of any Interest Period for
LIBO Rate Loans, the reserve percentage (expressed as a decimal) equal to the
maximum aggregate reserve requirements (including all basic, emergency,
supplemental, marginal and other reserves and taking into account any
transitional adjustments or other scheduled changes in reserve requirements)
specified from time to time under regulations issued from time to time by the
F.R.S. Board and then applicable to assets or liabilities consisting of and
including "Eurocurrency Liabilities", as currently defined in Regulation D of
the F.R.S. Board.
All LIBO Rate Loans shall bear interest from and including the first day
of the applicable Interest Period to (but not including) the last day of such
Interest Period at the interest rate determined as applicable to such LIBO Rate
Loan.
SECTION 3.2.2. Post-Maturity Rates. After the date any principal amount
of any Loan is due and payable (whether on the Stated Maturity Date, upon
acceleration or otherwise), or after any other monetary Obligation of the
Borrower shall have become due and payable, the Borrower shall pay, but only to
the extent permitted by law, interest (after as well as before judgment) on
such amounts at a rate per annum equal to the Alternate Base Rate plus the
Applicable Margin plus a margin of 2%.
SECTION 3.2.3. Payment Dates. Interest accrued on each Loan shall be
payable, without duplication:
(a) on the Stated Maturity Date therefor;
(b) on the date of any optional or required payment or prepayment,
in whole or in part, of principal outstanding on such Loan being prepaid;
35
(c) with respect to Base Rate Loans, on each Quarterly Payment Date
occurring after the Effective Date;
(d) with respect to LIBO Rate Loans, on the last day of each
applicable Interest Period (and, if such Interest Period shall exceed
three months, at the end of the third month of such Interest Period);
(e) with respect to any Base Rate Loans converted into LIBO Rate
Loans on a day when interest would not otherwise have been payable
pursuant to clause (c), on the date of such conversion; and
(f) on that portion of any Loans the Stated Maturity Date of which is
accelerated pursuant to Section 9.2 or Section 9.3, immediately upon
such acceleration.
Interest accrued on Loans or other monetary Obligations arising under this
Agreement or any other Loan Document after the date such amount is due and
payable (whether on the applicable Stated Maturity Date, upon acceleration or
otherwise) shall be payable upon demand.
SECTION 3.3. Fees. The Borrower agrees to pay the fees set forth in this
Section 3.3. All such fees shall be non-refundable.
SECTION 3.3.1. Commitment Fees. The Borrower agrees to pay to the Agent
for the account of each Revolving Lender, for the period (including any portion
thereof when any of its Commitments are suspended by reason of the Borrower's
inability to satisfy any condition of Article VI) commencing on the Effective
Date and continuing through the Revolving Loan Commitment Termination Date, a
commitment fee at the rate of 0.50% per annum, calculated on such Lender's
Revolving Percentage of the average daily unused portion of the Revolving
Commitment Amount. Such commitment fees shall be payable by the Borrower in
arrears on each Quarterly Payment Date, commencing with the first such day
following the Effective Date, and on the Revolving Loan Commitment Termination
Date.
SECTION 3.3.2. Lead Arrangers' Fees. The Borrower agrees to pay to the
lead arrangers identified on the cover page for their own account the fees
described in the Fee Letter, at the times required in such letter.
SECTION 3.3.3. Letter of Credit Fee. The Borrower agrees to pay to the
Agent, for the account of the Revolving Lenders, for each Letter of Credit for
the period from and including the date of the issuance of such Letter of Credit
to (and including) the date upon which (or on the next succeeding Business Day
upon which) such Letter of Credit expires or is returned to the Issuer that
issued such Letter of Credit, a fee, in Dollars, on the average daily stated
amount of such Letter of Credit (or the Equivalent Amount thereof with respect
to Foreign Currency Letters of Credit) calculated at a per annum rate equal to
the Applicable LIBO Rate Margin for Revolving Loans in effect from time to
time; provided, however, that for each day after the Stated Maturity Date for
Revolving Loans that any Letter of Credit shall be outstanding, the fees on
such Letter of Credit shall accrue at the Applicable LIBO Rate Margin for Term
B Loans in effect from time to time. Such fee shall be payable by the Borrower
in arrears on each Quarterly Payment Date, and on the date of termination or
expiry of the last Letter of Credit outstanding
36
hereunder (for any period then ending for which such fee shall not theretofore
have been paid), commencing on the first such date after the issuance of such
Letter of Credit.
SECTION 3.3.4. Letter of Credit Issuing Fee. The Borrower agrees to pay
to the Agent, for the account of each Issuer, an issuing fee, in Dollars, for
each Letter of Credit issued by such Issuer for the period from and including
the date of issuance of such Letter of Credit to (and including) the date upon
which such Letter of Credit expires or is returned to the Issuer that issued
such Letter of Credit at such rates as may be agreed in writing by the Borrower
and the Issuers from time to time. Such fee shall be payable by the Borrower in
arrears on each Quarterly Payment Date and on the date of termination or expiry
of the last Letter of Credit outstanding hereunder for any period then ending
for which such fee shall not theretofore have been paid, commencing on the
first such date after the issuance of such Letter of Credit.
ARTICLE IV
LETTERS OF CREDIT
SECTION 4.1. Issuance Requests. By delivering to the Agent and an Issuer
an Issuance Request on or before 12:00 noon, New York time, the Borrower may
request, from time to time prior to the Revolving Loan Commitment Termination
Date and on not less than three nor more than ten Business Days' notice, that
such Issuer issue an irrevocable standby letter of credit, in Dollars, Canadian
Dollars or Sterling (provided that the Equivalent Amount of the aggregate
Stated Amount of all Foreign Currency Letters of Credit after giving effect to
such issuance shall not exceed the Foreign Currency Letter of Credit Commitment
Amount) and in such form as may be requested by the Borrower and approved by
such Issuer (each, together with the Existing Letters of Credit and any Foreign
Currency Letters of Credit, a "Letter of Credit"), in support of the general
corporate purposes of the Borrower (including credit support by the Borrower
for gas and power contracts for Calpine Energy Services, L.P., Calpine Energy
Services Canada Partnership and Calpine Energy Services UK Limited) and which
are described in such Issuance Request, provided that no Letter of Credit may
be used to finance acquisitions (other than acquisitions of equipment, sites
and property in the ordinary course of the Borrower and its Subsidiaries'
business, but in no event may Letters of Credit be used to finance acquisitions
of power projects, reserves of geothermal steam and fluids and material gas
reserves) or make any Investments in any third parties (other than
Subsidiaries), directly or indirectly, through the Borrower or any of its
Subsidiaries or Affiliates and provided, further, that Letters of Credit shall
only be used to secure or support obligations (other than for the deferred
purchase price of property) entered into in the ordinary course of business of
the Company and its Restricted Subsidiaries. Upon receipt of an Issuance
Request, the Agent shall promptly notify the Revolving Lenders thereof. Each
Letter of Credit shall by its terms:
(a) be issued in a Stated Amount which
(i) is at least the Equivalent Amount of $500,000 or such
lesser amount as may be agreed by the Agent;
(ii) does not exceed (or would not exceed) the then Revolving
Commitment Availability;
37
(b) be stated to expire on a date (its "Stated Expiry Date") no later
than the earlier of one year from its date of issuance and May 24, 2003
(which date may, with the written consent of the Borrower, ING (U.S.)
Capital LLC and the Revolving Lead Arrangers, be extended to a date no
later than five Business Days prior to the Stated Maturity Date for Term
B Loans); provided, however, that a Letter of Credit may provide that if
it is not renewed prior to its Stated Expiry Date, it may be drawn by the
beneficiary thereof; and
(c) on or prior to its Stated Expiry Date
(i) terminate immediately upon notice to the Issuer thereof
from the beneficiary thereunder that all obligations covered thereby
have been terminated, paid, or otherwise satisfied in full and
surrender by the beneficiary of the Letter of Credit to such Issuer,
and
(ii) reduce in part immediately and to the extent the
beneficiary thereunder has notified the Issuer thereof that the
obligations covered thereby have been paid or otherwise satisfied
in part and that the Letter of Credit may be reduced.
So long as no Default (other than a Nonmaterial Subsidiary Default) has occurred
and is continuing by delivery to the Issuer thereof and the Agent of an Issuance
Request at least three but not more than ten Business Days prior to the Stated
Expiry Date of any Letter of Credit, the Borrower may request such Issuer on any
date prior to the Stated Maturity Date for Revolving Loans to extend the Stated
Expiry Date of such Letter of Credit for an additional period not to exceed the
earlier of one year from its date of extension or May 24, 2003 (which date may,
with the written consent of the Borrower, ING (U.S.) Capital LLC and the
Revolving Lead Arrangers, be extended to a date no later than five Business Days
prior to the Stated Maturity Date for Term B Loans).
SECTION 4.2. Issuances and Extensions. On the terms and subject to the
conditions of this Agreement (including Article VI), the Issuer to whom notice
was given under Section 4.1 shall issue Letters of Credit, and extend the Stated
Expiry Dates of outstanding Letters of Credit, in accordance with the Issuance
Requests made therefor. Such Issuer will make available the original of each
Letter of Credit which it issues in accordance with the Issuance Request
therefor to the beneficiary thereof (and will notify the Agent of any issuance
or amendment and such notice will be accompanied by a copy of each Letter of
Credit issued and any amendment thereto) and will notify the beneficiary under
any Letter of Credit of any extension of the Stated Expiry Date thereof. The
Agent will promptly notify the Revolving Lenders of issuances and amendments
and, if requested in a writing by a Revolving Lender, will provide copies of
issuances and amendments to such requesting Revolving Lender.
SECTION 4.3. Expenses. The Borrower agrees to pay to the Agent for the
account of each Issuer the standard charges of such Issuer in connection with
the issuance, maintenance, modification (if any) and administration of each
Letter of Credit issued by such Issuer upon demand from time to time.
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SECTION 4.4. Other Revolving Lenders' Participation. Each Letter of
Credit issued pursuant to Section 4.2 shall, effective upon its issuance and
without further action, be issued on behalf of all Revolving Lenders (including
the Issuer thereof) pro rata according to their respective Revolving
Percentages. Each Revolving Lender shall, to the extent of its Revolving
Percentage, be deemed irrevocably to have participated in the issuance of such
Letter of Credit and shall be responsible to pay promptly to the Issuer thereof
such Lender's Revolving Percentage of any unreimbursed drawings under a Letter
of Credit which have not been reimbursed by the Borrower in accordance with
Section 4.5, or which have been reimbursed by the Borrower but must be
returned, restored or disgorged by the Issuer thereof for any reason, and each
Revolving Lender shall, to the extent of its Revolving Percentage, be entitled
to receive from the Agent a ratable portion of the letter of credit fees
received by the Agent pursuant to Section 3.3.3, with respect to each Letter of
Credit. Each Revolving Lender acknowledges and agrees that its obligation to
acquire participations pursuant to this Section 4.4 in respect of Letters of
Credit issued or amended while such Revolving Lender remains a party to this
Agreement is absolute and unconditional and shall not be affected by any
circumstance whatsoever, including any amendment of any Letter of Credit or the
occurrence and continuation of a Default or Event of Default or reduction or
termination of the Revolving Loan Commitments, and that each such payment shall
be made without any offset, abatement, withholding or reduction whatsoever. In
the event that the Borrower shall fail to reimburse the Issuer thereof, or if
for any reason Revolving Loans shall not be made to fund any Reimbursement
Obligation, all as provided in Section 4.5 and in an amount equal to the amount
of any drawing honored by such Issuer under a Letter of Credit issued by it, or
in the event such Issuer must for any reason return or disgorge such
reimbursement, such Issuer shall promptly notify each Revolving Lender of the
unreimbursed amount of such drawing and of such Revolving Lender's respective
participation therein. Each Revolving Lender shall make available to such
Issuer, whether or not any Default shall have occurred and be continuing, an
amount equal to its respective participation in same day or immediately
available funds at the office of such Issuer specified in such notice not later
than 2:00 p.m., New York time, on the Business Day (under the laws of the
jurisdiction of such Issuer) after the date notified by such Issuer. In the
event that any Revolving Lender fails to make available to an Issuer the amount
of such Revolving Lender's participation in such Letter of Credit as provided
herein, such Issuer shall be entitled to recover such amount on demand from
such Revolving Lender together with interest at the daily average Federal Funds
Rate for three Business Days and thereafter at the Alternate Base Rate plus 2%.
Nothing in this Section shall be deemed to prejudice the right of any Revolving
Lender to recover from any Issuer any amounts made available by such Revolving
Lender to an Issuer pursuant to this Section in the event that it is determined
by a court of competent jurisdiction that the payment with respect to a Letter
of Credit by the Issuer thereof in respect of which payment was made by such
Revolving Lender constituted gross negligence or willful misconduct on the part
of such Issuer. Each Issuer shall distribute to each Revolving Lender which has
paid all amounts payable by it under this Section with respect to any Letter of
Credit issued by such Issuer such Lender's Revolving Percentage of all payments
received by such Issuer from the Borrower in reimbursement of drawings honored
by such Issuer under such Letter of Credit when such payments are received.
SECTION 4.5. Disbursements. Each Issuer will notify the Borrower and the
Agent promptly of the presentment for payment of any Letter of Credit issued by
it, together with notice of the date (a "Disbursement Date") such payment shall
be made (each such payment, a
39
"Disbursement"). Unless otherwise agreed by the applicable Issuer and the
Borrower, drawings under any Letter of Credit issued under Section 4.1 shall be
made on sight. Subject to the terms and provisions of such Letter of Credit,
each Issuer shall make such payment to the beneficiary (or its designee) of
such Letter of Credit. Prior to 2:00 p.m., New York time, on the Disbursement
Date, the Borrower will reimburse each Issuer for all amounts in the currency
which it has disbursed under the Letter of Credit or will notify such Issuer
that it elects to make such reimbursement by requesting the Revolving Lenders
to make a Revolving Loan in the Equivalent Amount of such required
reimbursement. If Borrower elects to make such reimbursement by requesting a
Revolving Loan in such amount and the conditions precedent in Article VI shall
have been satisfied, the Revolving Lenders shall fund such Reimbursement
Obligation by making Base Rate Loans in the appropriate Equivalent Amounts in
accordance with Section 2.3. To the extent an Issuer is not reimbursed in full
on the date payment is made under a Letter of Credit, the Borrower's
Reimbursement Obligation shall accrue interest at the Alternate Base Rate plus
the Applicable Base Rate Margin for two Business Days and thereafter at the
Post Maturity Rate described in Section 3.2.2, payable on demand, until
reimbursed in full. In the event an Issuer is not reimbursed by the Borrower on
any Disbursement Date, or if an Issuer must for any reason return or disgorge
such reimbursement, the Revolving Lenders (including such Issuer) shall fund
the Reimbursement Obligation therefor by making, on the next Business Day,
Loans (or, if the Revolving Loan Commitments shall no longer then be in effect,
advances ("L/C Advances") that are payable on demand and have the same
characteristics as Loans and which shall be Obligations hereunder) in the
appropriate Equivalent Amounts which are Base Rate Revolving Loans (or L/C
Advances bearing interest by reference to the Base Rate) (except that such
Revolving Loans or L/C Advances shall be made upon demand by the Agent rather
than upon notice by the Borrower and shall be made, notwithstanding anything in
this Agreement to the contrary, without regard to the satisfaction of the
conditions precedent to the making of Revolving Loans set forth in Article VI
of this Agreement and notwithstanding any termination of the Commitments). Each
Revolving Lender's obligation to make Revolving Loans or L/C Advances in the
amount of its Revolving Percentage of any unreimbursed amounts outstanding
under a Letter of Credit pursuant hereto is several, and not joint or joint and
several. Except as specifically noted herein, all terms and provisions that are
applicable to Revolving Loans under this Agreement shall be equally applicable
to L/C Advances. For example, and without limitation, the provisions of
Sections 3.1(e), 3.2.2, 3.2.3, 5.5, 5.6, 5.8, 5.9, 7.13, 8.2.10(b)(iii), 9.1.1,
10.5, 11.1(c), 11.4(a) and 11.11 shall equally apply to L/C Advances as well as
Loans.
SECTION 4.6. Reimbursement. The Borrower's obligation (a "Reimbursement
Obligation") under Section 4.5 to reimburse an Issuer with respect to each
disbursement (including interest thereon), and each Revolving Lender's
obligation to make participation payments in each drawing which has not been
reimbursed by the Borrower, shall be absolute and unconditional under any and
all circumstances and irrespective of any setoff, counterclaim, or defense to
payment which the Borrower may have or have had against any Revolving Lender or
any beneficiary of a Letter of Credit, including any defense based upon the
occurrence of any Default, any draft, demand or certificate or other document
presented under a Letter of Credit proving to be forged, fraudulent, invalid or
insufficient, the failure of any disbursement to conform to the terms of the
applicable Letter of Credit (if, in such Issuer's good faith opinion, such
disbursement is determined to be appropriate) or any non-application or
misapplication by the beneficiary of the proceeds of such disbursement, or the
legality, validity, form, regularity, or
40
enforceability of such Letter of Credit; provided, however, that nothing herein
shall adversely affect the right of the Borrower to commence any proceeding
against an Issuer for any wrongful disbursement made by such Issuer under a
Letter of Credit as a result of acts or omissions constituting gross negligence
or willful misconduct on the part of such Issuer.
SECTION 4.7. Cash Collateral. Upon the occurrence and during the
continuation of any Event of Default described in Section 9.1.9 or upon notice
to the Borrower after the occurrence and during the continuation of any other
Event of Default, at the election of the Agent acting on instructions from the
Required Revolving Lenders, an amount equal to that portion of Letter of Credit
Outstandings attributable to outstanding and undrawn Letters of Credit shall be
deemed to have been paid or disbursed by the Issuers under the Letters of
Credit (notwithstanding that such amount may not in fact have been paid or
disbursed), and, upon notification by the Issuers to the Agent and the Borrower
of its obligations under this Section, the Borrower shall be immediately
obligated to reimburse the Agent the amount deemed to have been so paid or
disbursed by the Issuers. Any amounts so received by the Agent from the
Borrower pursuant to this Section shall be held as collateral security for the
repayment of the Borrower's obligations in connection with the Letters of
Credit. At any time when such a Letter of Credit shall terminate and all L/C
Advances and Obligations of the Borrower to the Issuers in respect of such
Letter of Credit are either terminated or paid or reimbursed to the Revolving
Lenders and the Issuers in full, the Obligations of the Borrower under this
Section with respect to such Letter of Credit shall also terminate (subject,
however, to reinstatement in the event any payment in respect of such Letter of
Credit is recovered in any manner from any Issuer or Revolving Lender), and the
Agent will return to the Borrower the aggregate amount deposited by the
Borrower with the Agent in respect of such Letter of Credit and not theretofore
applied by the Agent to any Reimbursement Obligation.
At such time when all Events of Default shall have been cured or waived,
the Agent shall return to the Borrower all amounts then on deposit with it
pursuant to this Section. All amounts on deposit pursuant to this Section
shall, until their application to any Reimbursement Obligation or their return
to the Borrower, as the case may be, bear interest at the daily average Federal
Funds Rate from time to time in effect (net of the costs of any reserve
requirements, in respect of amounts on deposit pursuant to this Section,
pursuant to F.R.S. Board Regulation D), which interest shall be held by the
Agent as additional collateral security for the repayment of the Borrower's
Obligations in connection with the Letters of Credit issued by the Issuers.
SECTION 4.8. Nature of Reimbursement Obligations. The Borrower shall
assume all risks of the acts, omissions, or misuse of any Letter of Credit by
the beneficiary thereof. Neither any Issuer (except to the extent of its own
gross negligence or willful misconduct) nor any Revolving Lender shall be
responsible for:
(a) the form, validity, sufficiency, accuracy, genuineness, or legal
effect of any document submitted by any party in connection with the
application for and issuance of a Letter of Credit, even if it should in
fact prove to be in any or all respects invalid, insufficient,
inaccurate, fraudulent, or forged;
(b) the form, validity, sufficiency, accuracy, genuineness, or legal
effect of any instrument transferring or assigning or purporting to
transfer or assign a Letter of
41
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;
(c) failure of the beneficiary to comply fully with conditions
required in order to demand payment under a Letter of Credit;
(d) errors, omissions, interruptions, or delays in transmission or
delivery of any messages, by mail, cable, telegraph, telex, or otherwise;
(e) any error, omission, interruption, loss or delay in the
transmission or delivery of any draft, notice or other communication
under or relating to any Letter of Credit (including any document
required in order to make a Disbursement thereunder) or of the proceeds
thereof;
(f) any error in interpretation of technical terms;
(g) the performance of any transaction which underlies any Letter of
Credit;
(h) any act or omission of any Person other than the Issuer and the
Revolving Lenders;
(i) loss or destruction of any draft, demand, or document in transit
or in the possession of others;
(j) lack of knowledge of any particular trade usage (other than
standard United States and Western European banking usage as used in the
normal course of business); or
(k) any consequence arising from causes beyond the control of the
Issuer and the Revolving Lenders.
None of the foregoing shall affect, impair, or prevent the vesting of any of the
rights or powers granted any Issuer or any Revolving Lender hereunder. In
furtherance and extension, and not in limitation or derogation, of any of the
foregoing, any action taken or omitted to be taken by an Issuer in good faith
and which is not grossly negligent shall be binding upon the Borrower and shall
not put such Issuer under any resulting liability to the Borrower; provided,
however, that nothing herein shall relieve any Issuer, the Agent or any
Revolving Lender for any liability for its gross negligence or willful
misconduct.
SECTION 4.9. Increased Costs; Indemnity. If by reason of
(a) any change after the Effective Date in applicable law,
regulation, rule, decree or regulatory requirement or any change after
the Effective Date in the interpretation or application by any judicial
or regulatory authority of any law, regulation, rule, decree or
regulatory requirement, or
(b) compliance by any Issuer or any Revolving Lender with any new or
modified (after the Effective Date) direction, request or requirement
(whether or not
42
having the force of law) of any governmental or monetary authority,
including Regulation D of the F.R.S. Board:
(i) any Issuer or any Revolving Lender shall be subject to any
tax (other than franchise taxes or taxes measured by net income or
receipts), levy, charge or withholding of any nature or to any
variation thereof or to any penalty with respect to the maintenance
or fulfillment of its obligations under this Article IV, whether
directly or by such being imposed on or suffered by any Issuer or
any Revolving Lender;
(ii) any reserve, deposit or similar requirement is or shall be
applicable, imposed or modified in respect of any Letters of Credit
issued by any Issuer or participations therein purchased by any
Revolving Lender; or
(iii) there shall be imposed on any Issuer or any Revolving
Lender any other condition regarding this Article IV, any Letter of
Credit or any participation therein;
and the result of the foregoing is directly or indirectly to increase the cost
to an Issuer or such Revolving Lender of issuing, making or maintaining any
Letter of Credit or of purchasing or maintaining any participation therein, or
to reduce any amount receivable in respect thereof by such Issuer or such
Revolving Lender, then and in any such case such Issuer or such Revolving Lender
may, at any time after the additional cost is incurred or the amount received is
reduced, notify the Borrower thereof and provide Borrower with data and
calculations supporting such costs, and the Borrower shall pay such amounts as
such Issuer or Revolving Lender may specify to be necessary to compensate such
Issuer or Revolving Lender for such additional cost or reduced receipt within
ten (10) Business Days after receiving such notice, together with interest on
such amount from the date of receipt of such notice until payment in full
thereof at a rate equal at all times to the Alternate Base Rate plus the
Applicable Margin; provided, however, that Section 5.6, rather than this Section
4.9 shall govern Borrower's obligations with respect to Taxes relating to
payments by the Borrower described in the first sentence of Section 5.6(a). The
good faith determination by an Issuer or Revolving Lender, as the case may be,
of any amount due pursuant to this Section, as set forth in a statement setting
forth the calculation thereof in reasonable detail, shall, in the absence of
manifest error, be final and conclusive and binding on all of the parties
hereto. In addition to amounts payable as elsewhere provided in this Article IV,
the Borrower hereby agrees to protect, indemnify, pay and save the Issuers and
the Revolving Lenders harmless from and against any and all claims, demands,
liabilities, damages, losses, costs, charges and expenses (including reasonable
attorneys' fees) which any Issuer or any Revolving Lender may incur or be
subject to as a consequence, direct or indirect, of
(x) the issuance of the Letters of Credit, other than as a result of
the gross negligence or willful misconduct of an Issuer as determined by
a court of competent jurisdiction, or
(y) the failure of an Issuer to honor a drawing under any Letter of
Credit as a result of any act or omission, whether rightful or wrongful,
of any present or future de jure or de facto government or governmental
authority.
43
SECTION 4.10. Existing Letters of Credit. On the Effective Date, the
Existing Letters of Credit shall be deemed for all purposes to be Letters of
Credit outstanding under this Agreement and entitled to the benefits of this
Agreement and the other Loan Documents, and shall be governed by the
applications and agreements pertaining thereto and by this Agreement. Each
Revolving Lender shall be deemed to, and hereby irrevocably and unconditionally
agrees to, purchase from the Issuers on the Effective Date a participation in
each such Letter of Credit and each drawing thereunder in an amount equal to
the product of (i) such Lender's Revolving Percentage times (ii) the maximum
amount available to be drawn under such Letter of Credit and the amount of such
drawing, respectively. For purposes of Section 2.1.2, the Existing Letters of
Credit shall be deemed to utilize pro rata the Revolving Loan Commitment of
each Revolving Lender.
SECTION 4.11. Equivalent Amount Determinations. For purposes of
determining the amount of Foreign Currency Letter of Credit Outstandings and
for purposes of calculating fees payable under Section 3.3.3 with respect to
Foreign Currency Letter of Credit Outstandings, the principal amount of such
Foreign Currency Letter of Credit Outstandings shall be deemed to be, as of any
date of determination, the Equivalent Amount thereof at such date. The initial
Equivalent Amount of any Foreign Currency Letter of Credit shall be determined
by the Issuer of such Letter of Credit and notified by such Issuer in writing
to the Agent and the Borrower on the date of issuance thereof. If a
Disbursement is made by an Issuer under any Foreign Currency Letter of Credit,
the Equivalent Amount of such Disbursement shall be determined by the relevant
Issuer on the Disbursement Date related thereto, and such Issuer shall notify
the Agent and the Borrower promptly of such Equivalent Amount.
SECTION 4.12. Currency Fluctuations, etc. Not later than 12:00 p.m., New
York time, on each Quarterly Payment Date, each Issuer shall determine the
Equivalent Amount as of such Quarterly Payment Date with respect to each
Foreign Currency for which there are at such time outstanding Foreign Currency
Letters of Credit issued by such Issuer or in respect thereof (after giving
effect to any Loans to be made or repaid or Letters of Credit to be issued or
Reimbursement Obligations to be repaid on such date). Each Issuer shall notify
the Borrower, the Revolving Lenders and the Agent of such Equivalent Amount.
The Equivalent Amount so determined shall become effective on the first
Business Day immediately following the relevant Quarterly Payment Date (each, a
"Reset Date") and shall remain effective until the next succeeding Reset Date.
ARTICLE V
CERTAIN LIBO RATE AND OTHER PROVISIONS
SECTION 5.1. LIBO Rate Lending Unlawful. If any Lender shall determine in
good faith (which good faith determination shall, upon notice thereof to the
Borrower and the Lenders, be conclusive and binding on the Borrower) that the
introduction of or any change in or in the interpretation of any law makes it
unlawful, or any central bank or other governmental authority asserts that it
is unlawful, for such Lender to make, continue or maintain any Loan as, or to
convert any Loan into, a LIBO Rate Loan, the obligations of all Lenders to
make, continue, maintain or convert into any such Loans shall, upon such
determination, forthwith be suspended until such Lender shall notify the Agent
that the circumstances causing such suspension no
44
longer exist, and all LIBO Rate Loans of such type shall automatically convert
into Base Rate Loans at the end of the then current Interest Periods with
respect thereto or sooner, if required by such law or assertion. Until such
time as such Lender's obligation to make, continue and maintain LIBO Rate Loans
is reinstated, the Borrower shall have the right (with the prior written
consent of the Agent, which consent shall not be unreasonably withheld) to
replace such affected Lender by obtaining another financial institution that is
willing to purchase such affected Lender's interest herein for the full amount
of any outstanding Loans, Reimbursement Obligations and other amounts owed
hereunder (including principal, accrued interest, breakage costs and any other
unreimbursed costs and expenses owed to such Lender), to assume such affected
Lender's obligations under this Agreement and to become a Lender hereunder. In
such event, the affected Lender shall, upon ten (10) Business Days notice from
Borrower, assign one hundred percent (100%) of its interest hereunder to such
replacement lender for the price described in the previous sentence.
SECTION 5.2. Deposits Unavailable. If the Agent shall have determined
that
(a) Dollar deposits in the relevant amount and for the relevant
Interest Period are not available to the Agent or any Lender in its
relevant market; or
(b) by reason of circumstances affecting the Agent's or any Lender's
relevant market, adequate means do not exist for ascertaining the
interest rate applicable hereunder to LIBO Rate Loans,
then, upon notice from the Agent to the Borrower and the Lenders, the
obligations of all Lenders under Section 2.3 and Section 2.4 to make or continue
any Loans as, or to convert any Loans into, LIBO Rate Loans shall forthwith be
suspended (at the end of the applicable Interest Period, in the case of
outstanding LIBO Rate Loans) until the Agent shall notify the Borrower and the
Lenders that the circumstances causing such suspension no longer exist.
SECTION 5.3. Increased LIBO Rate Loan Costs, etc. The Borrower agrees to
reimburse each Lender for any increase in the cost to such Lender of, or any
reduction in the amount of any sum receivable by such Lender in respect of,
making, continuing or maintaining (or of its obligation to make, continue or
maintain) any Loans as, or of converting (or of its obligation to convert) any
Loans into, LIBO Rate Loans as a result in any change after the Effective Date,
in applicable law, regulation, rule, decree or regulatory requirement or in the
interpretation or application by any judicial or regulatory authority of any
law, regulation, rule, decree or regulatory requirement. Such Lender shall
promptly notify the Agent and the Borrower in writing of the occurrence of any
such event, such notice to state, in reasonable detail, the reasons therefor and
the additional amount required fully to compensate such Lender for such
increased cost or reduced amount. Such additional amounts shall be payable by
the Borrower directly to such Lender within five Business Days of its receipt of
such notice, and such notice shall, in the absence of manifest error and if
given in good faith, be conclusive and binding on the Borrower. If such
increased costs do not affect all of the Lenders, the Borrower shall have the
right (with the prior written consent of the Agent, which consent shall not be
unreasonably withheld) to replace the affected Lender by obtaining another
financial institution that is willing to purchase such affected Lender's
interest herein for the full amount of any outstanding Loans and Reimbursement
Obligations (principal and accrued interest), to assume such affected Lender's
45
obligations under this Agreement and to become a Lender hereunder. In such
event, the affected Lender shall, upon five (5) Business Days notice from
Borrower, assign one hundred percent (100%) of its interests hereunder to such
replacement lender for the price described in the previous sentence and
thereafter such Lender shall have no further obligations hereunder.
SECTION 5.4. Funding Losses. In the event any Lender shall incur any loss
or expense (including any loss or expense incurred by reason of the liquidation
or reemployment of deposits or other funds acquired by such Lender to make,
continue or maintain any portion of the principal amount of any Loan as, or to
convert any portion of the principal amount of any Loan into, a LIBO Rate Loan)
as a result of
(a) any conversion or repayment or prepayment of the principal amount
of any LIBO Rate Loans on a date other than the scheduled last day of the
Interest Period applicable thereto;
(b) any Loans not being made as LIBO Rate Loans in accordance with
the Borrowing Request therefor other than as a result of any act or
omission by such Lender;
(c) any Loans not being continued as, or converted into, LIBO Rate
Loans in accordance with the Continuation/ Conversion Notice therefor
other than as a result of any act or omission by such Lender; or
(d) any LIBO Rate Loan not being prepaid in accordance with a notice
of prepayment,
then, upon the written notice of such Lender to the Borrower (with a copy to the
Agent), the Borrower shall, within five Business Days of its receipt thereof,
pay directly to such Lender such amount as will (in the reasonable determination
of such Lender) reimburse such Lender for such loss or expense. Such written
notice (which shall include calculations in reasonable detail and all
information and documentation reasonably necessary to support such calculations)
shall, in the absence of manifest error, be conclusive and binding on the
Borrower.
SECTION 5.5. Increased Capital Costs. If any change in, or the
introduction, adoption, effectiveness, interpretation, reinterpretation or
phase-in of, any law or regulation, directive, guideline, decision or request
(whether or not having the force of law) of any court, central bank, regulator
or other governmental authority causes the amount of capital required or
expected to be maintained by any Lender or any Person controlling such Lender
attributable to or based upon the Loans, the Letters of Credit or Commitments
hereunder to be increased, and such Lender determines (in its reasonable
discretion) that the rate of return on its or such controlling Person's capital
as a consequence of its Commitments, issuance of or participation in Letters of
Credit or the Loans made by such Lender is reduced to a level below that which
such Lender or such controlling Person could have achieved but for the
occurrence of any such circumstance, then, in any such case upon notice from
time to time by such Lender to the Borrower, the Borrower shall immediately pay
directly to such Lender additional amounts sufficient to compensate such Lender
or such controlling Person for such reduction in rate of return. A statement of
such Lender as to any such additional amount or amounts (including calculations
thereof in reasonable detail) shall, in the absence of manifest error and if
made in good faith, be conclusive and
46
binding on the Borrower. In determining such amount, such Lender may use any
method of averaging and attribution that it (in its good faith discretion)
shall deem applicable.
SECTION 5.6. Taxes. (a) Subject to each Lender's compliance with Section
5.6, all payments by the Borrower of principal of, and interest on, the Loans
and all other amounts payable hereunder shall be made free and clear of and
without deduction for any present or future income, excise, stamp or franchise
taxes and other taxes, fees, duties, withholdings or other charges of any
nature whatsoever imposed by any taxing authority, but excluding franchise
taxes and taxes imposed on or measured by any Lender's net income or receipts
(such non-excluded items being called "Taxes"). In the event that any
withholding or deduction from any payment to be made by the Borrower hereunder
is required in respect of any Taxes pursuant to any applicable law, rule or
regulation, then the Borrower will
(i) pay directly to the relevant authority the full amount
required to be so withheld or deducted;
(ii) promptly forward to the Agent an official receipt or other
documentation satisfactory to the Agent evidencing such payment to
such authority; and
(iii) pay to the Agent for the account of the Lenders such
additional amount or amounts as is necessary to ensure that the net
amount actually received by each Lender will equal the full amount
such Lender would have received had no such withholding or deduction
been required.
Moreover, if any Taxes are directly asserted against the Agent or any
Lender with respect to any payment received by the Agent or such Lender
hereunder, the Agent or such Lender may pay such Taxes and the Borrower
will promptly pay such additional amounts (including any penalties,
interest or expenses) as is necessary in order that the net amount
received by such person after the payment of such Taxes (including any
Taxes on such additional amount) shall equal the amount such person would
have received had not such Taxes been asserted.
If the Borrower fails to pay any Taxes when due to the appropriate
taxing authority or fails to remit to the Agent, for the account of the
respective Lenders, the required receipts or other required documentary
evidence, the Borrower shall indemnify the Lenders for any incremental
Taxes, interest or penalties that may become payable by any Lender as a
result of any such failure. For purposes of this Section 5.6, a
distribution hereunder by the Agent or any Lender to or for the account
of any Lender shall be deemed a payment by the Borrower.
(b) Upon the request of the Borrower or the Agent, each Lender
(including, any participant or Assignee Lender) that is (a) organized
under the laws of the United States or a state thereof shall execute and
deliver to the Borrower and the Agent one or more (as the Borrower or the
Agent may reasonably request) appropriately completed United States
Internal Revenue Service Forms W-9 (or any successor forms or documents)
and (b) organized under the laws of a jurisdiction other than the United
States
47
shall, prior to the due date of and as a condition to any payments
hereunder or under the Notes, execute and deliver to the Borrower and the
Agent one or more (as the Borrower or the Agent may reasonably request)
United States Internal Revenue Service Forms W-8ECI or Forms W-8BEN or
such other forms or documents (or successor forms or documents),
appropriately completed, as may be applicable to establish that such
Lender (or participant or Assignee Lender) is entitled to receive
payments under this Agreement without deduction or withholding of any
United States federal income taxes.
The Borrower shall not be required to pay any additional amounts to
any Lender (or participant or Assignee Lender) in respect of Taxes
pursuant to this Section 5.6 if the obligation to pay such additional
amounts would not have arisen but for a failure by such Lender (or
participant or Assignee Lender) to comply with the provisions of this
Section 5.6 unless such failure results from (a) a change in applicable
treaty, law or regulation or interpretation thereof or (b) an amendment,
modification or revocation of any applicable tax treaty or a change in
official position regarding the application or interpretation thereof, in
each case after the date such Lender (or participant or Assignee Lender)
becomes a party to this Agreement.
SECTION 5.7. Payments, Computations, etc. Unless otherwise expressly
provided, all payments by the Borrower pursuant to this Agreement, the Notes or
any other Loan Document shall be made by the Borrower to the Agent for the pro
rata account of the Lenders entitled to receive such payment. All such payments
required to be made to the Agent shall be made, without setoff, deduction or
counterclaim, not later than 11:00 a.m., San Francisco time, on the date due,
in same day or immediately available funds, to such account as the Agent shall
specify from time to time by notice to the Borrower. Funds received after that
time shall be deemed to have been received by the Agent on the next succeeding
Business Day. The Agent shall promptly remit in same day funds to each Lender
its share, if any, of such payments received by the Agent for the account of
such Lender. All interest and fees shall be computed on the basis of the actual
number of days (including the first day but excluding the last day) occurring
during the period for which such interest or fee is payable over a year
comprised of 360 days (or, in the case of interest on a Base Rate Loan (other
than when calculated with respect to the Federal Funds Rate), 365 days or, if
appropriate, 366 days). Whenever any payment to be made shall otherwise be due
on a day which is not a Business Day, such payment shall (except as otherwise
required by clause (c) of the definition of the term "Interest Period" with
respect to LIBO Rate Loans) be made on the next succeeding Business Day and
such extension of time shall be included in computing interest and fees, if
any, in connection with such payment.
SECTION 5.8. Sharing of Payments. If any Lender shall obtain any payment
or other recovery (whether voluntary, involuntary, by application of setoff or
otherwise) on account of any Loan (other than pursuant to the terms of Sections
5.3, 5.4 and 5.5) or Letter of Credit in excess of its pro rata share of
payments then or therewith obtained by all Lenders, such Lender shall purchase
from the other Lenders such participations in Loans made by them and/or Letters
of Credit as shall be necessary to cause such purchasing Lender to share the
excess payment or other recovery ratably with each of them; provided, however,
that if all or any portion of the excess payment or other recovery is
thereafter recovered from such purchasing Lender, the purchase shall be
rescinded and each Lender which has sold a participation to the purchasing
Lender shall repay to the purchasing Lender the purchase price to the ratable
extent of such
48
recovery together with an amount equal to such selling Lender's ratable share
(according to the proportion of (a) the amount of such selling Lender's
required repayment to the purchasing Lender to (b) 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 may, to the fullest extent permitted by law,
exercise all its rights of payment (including pursuant to Section 5.9) with
respect to such participation as fully as if such Lender were the direct
creditor of the Borrower in the amount of such participation. If under any
applicable bankruptcy, insolvency or other similar law, any Lender receives a
secured claim in lieu of a setoff to which this Section applies, such Lender
shall, to the extent practicable, exercise its rights in respect of such
secured claim in a manner consistent with the rights of the Lenders entitled
under this Section to share in the benefits of any recovery on such secured
claim.
SECTION 5.9. Use of Proceeds. The Borrower shall apply the proceeds of
each Borrowing in accordance with the fourth recital; without limiting the
foregoing, no Letter of Credit or proceeds of any Loan will be used to (i)
acquire any equity security of a class which is registered pursuant to Section
12 of the Securities Exchange Act of 1934 or any "margin stock", as defined in
F.R.S. Board Regulation U, (ii) finance acquisitions (other than the
acquisition of equipment, sites and property in the ordinary course of the
Borrower and its Subsidiaries' business, but in no event may Loans or Letters
of Credit be used to finance acquisitions of power projects, reserves of
geothermal steam and fluids and natural gas reserves), or (iii) make
Investments in any third parties (other than Investments in Subsidiaries),
directly or indirectly, through the Borrower or any of its Subsidiaries or
Affiliates.
ARTICLE VI
CONDITIONS PRECEDENT
SECTION 6.1. Initial Credit Extension. The obligation of each Lender to
make its initial Credit Extension shall be subject to the prior or concurrent
satisfaction of each of the conditions precedent set forth in this Section 6.1.
SECTION 6.1.1. Resolutions, etc. The Agent shall have received from each
Obligor a certificate, dated the date of the initial Borrowing, of its
Secretary or Assistant Secretary, as to
(a) resolutions of its Board of Directors then in full force and
effect authorizing the execution, delivery and performance of this
Agreement, the Notes and each other Loan Document to be executed by it;
and
(b) the incumbency and signatures of those of its officers authorized
to act with respect to this Agreement, the Notes and each other Loan
Document executed by it,
upon which certificate each Lender may conclusively rely until it shall have
received a further certificate of the Secretary of such Obligor canceling or
amending such prior certificate.
SECTION 6.1.2. Delivery of Revolving Notes. The Agent shall have
received, for the account of each Revolving Lender requesting same, its
Revolving Note duly executed and delivered by the Borrower.
49
SECTION 6.1.3. Guaranty. The Agent shall have received the Guaranty,
dated the date hereof, duly executed by the Guarantors.
SECTION 6.1.4. Pledge Agreements. The Agent shall have received executed
counterparts of the Pledge Agreements, dated as of the date hereof, together
with the certificates evidencing 100% of the issued and outstanding capital
stock of Calpine Holdings, CNGGP and CNGH and 65% of the issued and outstanding
capital stock of CCEC, all of which certificates shall in each case be
accompanied by undated stock powers duly executed in blank.
SECTION 6.1.5. Amendment to Existing Credit Agreement. The Agent shall
have received executed counterparts of an amendment to the Existing Credit
Agreement (a) increasing the pricing thereunder to the pricing set forth
hereunder, (b) amending the definition of the term "Issuer" to provide for
letters of credit to be issued both by Scotiabank and other to-be-determined
lenders thereunder, (c) permitting the creation of the security interest in
favor of the Lenders pursuant to the Assignment Agreement and the ratable
sharing of the proceeds of such security among the Lenders and the lenders
under the Existing Credit Agreement, and (d) addressing such other matters as
the Lead Arrangers may reasonably request.
SECTION 6.1.6. Termination of Master Reimbursement Agreement. The Agent
shall have received evidence satisfactory to it of the termination of the
Master Reimbursement Agreement for Letters of Credit dated as of August 23,
2001 among the Borrower, Scotiabank and BayernLB.
SECTION 6.1.7. Termination of Bank One Credit Facility. The Agent shall
have received evidence satisfactory to it of (a) the repayment of all
obligations under, and the termination of the commitments under, that certain
Credit Agreement dated as of January 1, 2000 among CNGC, Bank One N.A., as
agent, and each of the financial institutions party thereto from time to time,
as amended by the First Amendment dated September 28, 2000, the Second
Amendment dated March 30, 2001, the Third Amendment dated April 20, 2001 and
the Fourth Amendment dated August 13, 2001 (as so amended, the "Bank One
Agreement") or (b) the purchase by the Borrower of the Indebtedness under the
Bank One Agreement and the pledge of such Indebtedness to the Agent.
SECTION 6.1.8. Assignment Agreement. The Agent shall have received
executed counterparts of the Assignment Agreement duly executed by the
Borrower, together with
(a) acknowledgment copies of properly filed Uniform Commercial Code
financing statements (Form UCC-1) or such other evidence of filing as
may be acceptable to the Agent, naming the Borrower as the debtor and the
Agent as the secured party, or other similar instruments or documents,
filed under the Uniform Commercial Code of all jurisdictions as may be
necessary or, in the opinion of the Agent, desirable to perfect the
security interest of the Agent pursuant to the Assignment Agreement;
(b) executed copies of proper Uniform Commercial Code Form UCC-3
termination statements, if any, necessary to release all Liens and other
rights of any Person in any collateral described in the Assignment
Agreement previously granted by any Person; and
50
(c) certified copies of Uniform Commercial Code Requests for
Information or Copies (Form UCC-11), or a similar search report certified
by a party acceptable to the Agent, dated as of a date reasonably near to
the date of the initial Borrowing, listing all effective financing
statements which name Calpine Gilroy or the Borrower as the debtor and
which are filed in the jurisdictions in which filings were made pursuant
to clause (a) above, together with copies of such financing statements
(none of which (other than those described in clause (a), if such Form
UCC-11 or search report, as the case may be, is current enough to list
such financing statements described in clause (a)) shall cover any
collateral described in the Assignment Agreement); and
(d) a consent, in form and substance satisfactory to the Agent, from
PG&E to the assignment by Calpine Gilroy to the Borrower of its rights
under the agreement that is the subject of the Assignment Agreement and
the execution and delivery by the Borrower of the Assignment Agreement.
SECTION 6.1.9. Solvency. The Agent shall have received duly executed
Solvency Certificates from each of CCEC, CCEF and the Guarantors, dated as of
Effective Date.
SECTION 6.1.10. Compliance Certificate. The Agent shall have received a
certificate, executed by an Authorized Officer of the Borrower, showing
compliance with the financial covenants in Sections 6.3.4 and 8.2.4 as of
December 31, 2001.
SECTION 6.1.11. Fee Letter. The Agent shall have received the Fee Letter
duly executed by all parties thereto.
SECTION 6.1.12. Opinions of Counsel. The Agent shall have received
opinions, dated the date of the Effective Date and addressed to the Agent and
all Lenders, from
(a) Xxxx Xxxxxxxxxxxx, Esq., general counsel of the Borrower, and
Xxxxxxxxx & Xxxxxxx, special counsel to the Borrower, substantially in
the form of Exhibits F-1 and F-2.
(b) Mayer, Brown, Xxxx & Maw, counsel to the Agent, substantially in
the form of Exhibit G.
(c) XxXxxxxx Xxxxxxxx, special Canadian counsel to the Borrower,
substantially in the form of Exhibit L.
(d) Xxxxxxx XxXxxxxx Stirling Scales, special Canadian counsel to
the Borrower, substantially in the form of Exhibit M.
(e) Xxxxxx Xxxx & Priest, counsel to the Borrower, substantially in
the form of Exhibit N.
(f) Stoel Rives, counsel to the Borrower, substantially in the form
of Exhibit O.
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SECTION 6.1.13. Closing Fees, Expenses, etc. The Agent shall have
received for its own account, or for the account of each Lender, as the case
may be, all fees, costs and expenses due and payable pursuant to Sections 3.3
and 11.3, if then invoiced.
SECTION 6.1.14. No Material Adverse Effect. Except for those matters
described to the Lenders in Item 6.1.10 of the Disclosure Schedule that could
affect the prospects of the Borrower (the "Excepted Prospects"), no Material
Adverse Effect shall have occurred since December 31, 2000.
SECTION 6.1.15. Canadian Restructure. The contractual arrangements
described on Schedule 6.15 among CCEC, QCH and CCEF in respect of the term
debentures dated April 25, 2001, August 14, 2001 and August 23, 2001 between
CCEC and CCEF and the documentation executed in connection therewith shall have
been amended on terms reasonably satisfactory to the Revolving Lead Arrangers
and Term B Lead Arrangers.
SECTION 6.2. Term B Loan Borrowing. The obligations of the Term B Lenders
to fund the Term B Loans shall be subject to the prior or concurrent
satisfaction of each of the conditions precedent set forth in this Section 6.2;
provided, that if the initial Borrowing of Term B Loans is not funded by the
Term B Loan Commitment Termination Date, the Term B Loan Commitments shall then
expire.
SECTION 6.2.1. Syndication of Term B Commitments. The Term B Lead
Arrangers shall have completed the syndication of the Term B Loan Commitments
on terms to their reasonable satisfaction; provided, however, that
notwithstanding the foregoing the Borrower may make the Borrowing of Term B
Loans on the Term B Loan Commitment Termination Date.
SECTION 6.2.2. Term B Notes. The Agent shall have received, for the
account of each Term B Lender requesting the same, a Term B Note duly executed
and delivered by the Borrower.
SECTION 6.2.3. Deeds of Trust, etc. The Agent and Term B Lead Arrangers
shall have received confirmation that all of the Domestic Gas Reserves shall
have been transferred to the Borrower and that the other requirements of
Section 8.1.8 shall have been satisfied on or before the date of the requested
Borrowing.
SECTION 6.2.4. CCFCI. The Agent and Term B Lead Arrangers shall have
received confirmation that all of the requirements of Section 8.1.9 shall have
been satisfied on or before the date of the requested Borrowing.
SECTION 6.2.5. Senior Debt Rating. The Agent and Term B Lead Arrangers
shall have received confirmation that the debt rating given to the Loans and
then in effect from Xxxxx'x shall be Ba3 or better and the debt rating from S&P
shall be BB- or better.
SECTION 6.2.6. Market Disruption. The Term B Lead Arrangers, in their
good faith judgment, shall have determined that there has not occurred any
disruption of, or adverse change in, financial, banking or capital market
conditions since the date of this Agreement that could materially impair the
satisfactory syndication of the Term B Credit Facility.
52
SECTION 6.2.7. Canadian Undertakings. The Borrower shall cause to be
delivered to the Agent and the Lenders such solvency opinions in respect of
each of CCEC, CCEF and QCH from Houlihan, Lokey, Xxxxxx & Zukin in a form and
as of such dates as may be reasonably satisfactory to the Revolving Lead
Arrangers and Term B Lead Arrangers.
SECTION 6.3. All Credit Extensions. The obligation of each Lender to make
any Credit Extension (including the initial Credit Extension) shall be subject
to the satisfaction of each of the conditions precedent set forth in this
Section 6.3.
SECTION 6.3.1. Compliance with Warranties, No Default, etc. Both before
and after giving effect to any Credit Extension (but, if any Default of the
nature referred to in Section 9.1.5 shall have occurred with respect to any
other Indebtedness, without giving effect to the application, directly or
indirectly, of the proceeds of any Borrowing) the following statements shall be
true and correct
(a) the representations and warranties set forth in Article VII
(excluding, however, those contained in Section 7.7) and in each other
Loan Document shall be true and correct in all material respects with the
same effect as if then made (unless stated to relate solely to an early
date, in which case such representations and warranties shall be true and
correct as of such earlier date);
(b) except as disclosed by the Borrower to the Agent and the Lenders
pursuant to Section 7.7
(i) no labor controversy, litigation, arbitration or
governmental investigation or proceeding shall be pending or, to the
knowledge of the Borrower, threatened against the Borrower or any of
its Significant Subsidiaries which would reasonably be expected to
cause a Material Adverse Effect or which purports to materially and
adversely affect the legality, validity or enforceability of this
Agreement, the Notes or any other Loan Document; and
(ii) no development shall have occurred in any labor
controversy, litigation, arbitration or governmental investigation
or proceeding disclosed pursuant to Section 7.7 which might have a
Material Adverse Effect; and
(c) no Default (other than a Nonmaterial Subsidiary Default) shall
have then occurred and be continuing, and neither the Borrower, any other
Obligor, nor any of its Significant Subsidiaries are in material
violation of any law or governmental regulation or court order or decree
which would reasonably be expected to cause a Material Adverse Effect.
SECTION 6.3.2. Credit Request. The Agent shall have received a Borrowing
Request or Issuance Request, as the case may be, for such Credit Extension.
Each of the delivery of a Borrowing Request or an Issuance Request and the
acceptance by the Borrower of the proceeds of the Borrowing or the issuance of
the Letter of Credit, as applicable, shall constitute a representation and
warranty by the Borrower that on the date of such Borrowing (both immediately
before and after giving effect to such Borrowing and the application of the
proceeds
53
thereof) or the issuance of the Letter of Credit, as applicable, the statements
made in Section 6.3.1 are true and correct.
SECTION 6.3.3. Satisfactory Legal Form. All documents executed or
submitted pursuant hereto by or on behalf of the Borrower or any of its
Subsidiaries or any other Obligors shall be satisfactory in form and substance
to the Agent and its counsel; the Agent and its counsel shall have received all
information, approvals, opinions, documents or instruments as the Agent or its
counsel may reasonably request.
SECTION 6.3.4. Interest Coverage Ratio (Parent Only). The Interest
Coverage Ratio (Parent Only), calculated as of the end of the most recently
ended Fiscal Quarter or, if the Interest Coverage Ratio (Parent Only) had
previously fallen below 1.70 to 1.00 and had not subsequently returned to 1.70
to 1.00 or better, calculated as of the end of the most recently ended calendar
month, shall be at least 1.70 to 1.00 for the previous 12 months.
SECTION 6.3.5. Indentures. (a) The Borrower shall have certified to the
Agent that its incurrence of the Indebtedness under such Borrowing is permitted
under the terms of Section 3.4 of the Xxx-0000 Xxxxxxxxxx. To the extent that
the Borrower is relying on clause (a) of Section 3.4 of the Xxx-0000
Xxxxxxxxxx, the Borrower shall have delivered to the Agent a certificate
demonstrating its compliance with the incurrence test set forth therein.
(b) The Borrower shall have certified to the Agent that the
incurrence of Liens in respect of such Borrowing is permitted under the
terms of Section 3.7 of the Xxx-0000 Xxxxxxxxxx and Section 3.4 of the
Shelf Indenture. To the extent the Borrower is relying on Section
3.7(f)(1) of each of the Xxx-0000 Xxxxxxxxxx and on Section 3.4(a)(i) of
the Shelf Indenture, the Borrower shall have delivered to the Agent a
certificate demonstrating its compliance with the provision thereof. To
the extent that the Borrower is relying on the proviso to Section 3.7 of
each of the Xxx-0000 Xxxxxxxxxx and the proviso to Section 3.4 of the
Shelf Indenture, the Borrower shall have delivered to the Agent a
certificate demonstrating its compliance with the incurrence tests set
forth therein.
SECTION 6.3.6. Solvency. Both before and after giving effect to any
Borrowing of Loans or issuance of any Letter of Credit hereunder, the Borrower
and its Subsidiaries, on a consolidated basis, shall be Solvent.
ARTICLE VII
REPRESENTATIONS AND WARRANTIES
In order to induce the Lenders and the Agent to enter into this
Agreement and to make Loans or L/C Advances and issue Letters of Credit
hereunder, the Borrower represents and warrants unto the Agent and each Lender
as set forth in this Article VII.
SECTION 7.1. Organization, etc. The Borrower and each of its Significant
Subsidiaries is a corporation, partnership, limited liability company or similar
entity validly organized and existing and in good standing under the laws of the
State of its organization, is duly qualified to do business and is in good
standing as a foreign organization in each jurisdiction where the
54
nature of its business requires such qualification and where the failure to so
qualify would have a material adverse effect on the Borrower's or any Obligor's
ability to perform its obligations under the Loan Documents to which it is a
party, and has full power and authority and holds all requisite governmental
licenses, permits and other approvals to enter into and perform its Obligations
under this Agreement, the Notes and each other Loan Document to which it is a
party and to own or hold under lease its property and to conduct its business
substantially as currently conducted by it.
SECTION 7.2. Due Authorization, Non-Contravention, etc. The execution,
delivery and performance by the Borrower of this Agreement, the Notes and each
other Loan Document executed or to be executed by it, and the execution,
delivery and performance by each other Obligor of each Loan Document executed
or to be executed by it are within the Borrower's and each such Obligor's
corporate powers, have been duly authorized by all necessary corporate action,
and do not
(a) contravene the Borrower's or any such Obligor's Organic
Documents;
(b) contravene any contractual restriction (including, without
limitation, the Senior Note Indentures), law or governmental regulation
or court decree or order binding on or affecting the Borrower or any such
Obligor; or
(c) result in, or require the creation or imposition of, any Lien on
any of the Borrower's or any other Obligor's properties.
SECTION 7.3. Government Approval, Regulation, etc. No authorization or
approval or other action by, and no notice to or filing with, any governmental
authority or regulatory body or other Person is required for the due execution,
delivery or performance by the Borrower or any other Obligor of this Agreement,
the Notes or any other Loan Document to which it is a party. Neither the
Borrower nor any of its Significant Subsidiaries is an "investment company"
within the meaning of the Investment Company Act of 1940, as amended, or a
"holding company", or a "subsidiary company" of a "holding company", or an
"affiliate" of a "holding company" or of a "subsidiary company" of a "holding
company", within the meaning of the Public Utility Holding Company Act of 1935,
as amended.
SECTION 7.4. Validity, etc. This Agreement constitutes, and the Notes
and each other Loan Document executed by the Borrower will, on the due
execution and delivery thereof, constitute, the legal, valid and binding
obligations of the Borrower enforceable in accordance with their respective
terms except as enforceability may be subject to or limited by (i) bankruptcy,
insolvency, reorganization, arrangement, moratorium or other similar laws
affecting the rights of creditors or (ii) general principles of equity,
including the possible unavailability of specific performance or injunctive
relief; and each Loan Document executed pursuant hereto by each other Obligor
will, on the due execution and delivery thereof by such Obligor, be the legal,
valid and binding obligation of such Obligor enforceable in accordance with its
terms except as enforceability may be subject to or limited by (i) bankruptcy,
insolvency, reorganization, arrangement, moratorium or other similar laws
affecting the rights of creditors or (ii) general principles of equity,
including the possible unavailability of specific performance or injunctive
relief.
55
SECTION 7.5. Financial Information. The balance sheets of the Borrower
and each of its Subsidiaries as at December 31, 2000 and the related statements
of earnings and cash flow of the Borrower and each of its Subsidiaries, copies
of which have been furnished to the Agent and each Lender, have been prepared
in accordance with GAAP consistently applied, and present fairly the
consolidated financial condition of the corporations covered thereby as at the
date thereof and the results of their operations for the period then ended.
SECTION 7.6. No Material Adverse Effect. Except for Excepted Prospects,
(a) since December 31, 2000, there has been no Material Adverse Effect and (b)
since the date hereof, there has been no material adverse development in the
matters set forth as Excepted Prospects that could have a material adverse
effect upon the financial condition, operations, assets (including power
projects), business or prospects of the Borrower and its Significant
Subsidiaries taken as a whole.
SECTION 7.7. Litigation, Labor Controversies, etc. There is no pending
or, to the knowledge of the Borrower, threatened litigation, action,
proceeding, investigation, or labor controversy affecting the Borrower or any
of its Significant Subsidiaries, or any of their respective properties,
businesses, assets or revenues, which would reasonably be expected to have a
Material Adverse Effect or which purports to materially and adversely affect
the legality, validity or enforceability of this Agreement, the Notes or any
other Loan Document, except as disclosed in Item 7.7 ("Litigation") of the
Disclosure Schedule.
SECTION 7.8. Subsidiaries. The Borrower has no Significant Subsidiaries,
except those Significant Subsidiaries
(a) which are identified in Item 7.8 ("Existing Significant
Subsidiaries") of the Disclosure Schedule; or
(b) which are permitted to have been acquired in accordance with
Section 8.2.5 or 8.2.9.
The organizational chart attached hereto as Schedule III accurately
reflects the ownership structures of the Borrower's equity interests in its
Foreign Subsidiaries as of the Closing Date.
SECTION 7.9. Ownership of Properties. The Borrower and each of its
Significant Subsidiaries owns good and marketable title to all of its material
properties and assets, real and personal, tangible and intangible, of any
nature whatsoever (including patents, trademarks, trade names, service marks
and copyrights), free and clear of all Liens, charges or claims (including
infringement claims with respect to patents, trademarks, copyrights and the
like) except as permitted pursuant to Section 8.2.3. As of the Effective Date,
the Borrower owns all of the equity interests in Calpine Holdings, CNGGP and
CNGH, CNGGP and CNGH own all of the partnership interests of CNGC, the Canadian
Gas Reserves are owned by Calpine Canada Natural Gas Partnership, the Domestic
Gas Reserves are owned by CNGC and Calpine Holdings indirectly owns all of the
partnership interests of CCFCI, the Saltend project is indirectly owned by CCEC
and the receivable that is the subject of the Assignment Agreement is owned by
the Borrower or Calpine Gilroy. Once the financing statements referred to in
Section 6.1.8(a) have been duly filed with the Secretaries of State of the
States of California and Delaware, all
56
governmental filings necessary to perfect and protect, and establish and, so
long as continuation statements are duly filed with the Secretaries of State of
the States of California and Delaware within the time periods required under
the Uniform Commercial Code, maintain the priority of, such Liens have been
duly effected or taken.
SECTION 7.10. Taxes. The Borrower and each of its Significant
Subsidiaries has filed all tax returns and reports required by law to have been
filed by it and has paid all taxes and governmental charges thereby shown to be
owing, except any such taxes or charges which are being diligently contested in
good faith by appropriate proceedings and for which adequate reserves in
accordance with GAAP shall have been set aside on its books.
SECTION 7.11. Pension and Welfare Plans. No steps have been taken to
terminate any Pension Plan, and no contribution failure has occurred with
respect to any Pension Plan sufficient to give rise to a Lien under section
302(f) of ERISA. No condition exists or event or transaction has occurred with
respect to any Pension Plan which might result in the incurrence by the
Borrower or any member of the Controlled Group of any material liability, fine
or penalty. Except as disclosed in Item 7.11 ("Employee Benefit Plans") of the
Disclosure Schedule, neither the Borrower nor any member of the Controlled
Group has any contingent liability with respect to any post-retirement benefit
under a Welfare Plan, other than liability for continuation coverage described
in Part 6 of Title I of ERISA.
SECTION 7.12. Environmental Warranties. Except as set forth in Item 7.12
("Environmental Matters") of the Disclosure Schedule:
(a) all facilities and property (including underlying groundwater)
owned or leased by the Borrower or any of its Significant Subsidiaries
have been, and continue to be, owned or leased by the Borrower and its
Significant Subsidiaries in material compliance with all Environmental
Laws;
(b) there have been no past, and there are no pending or, to the
Borrower's knowledge, threatened
(i) claims, complaints, notices or requests for information
received by the Borrower or any of its Significant Subsidiaries
with respect to any alleged violation of any Environmental Law that,
singly or in the aggregate, may reasonably be expected to result in
a Material Adverse Effect, or
(ii) complaints, notices or inquiries to the Borrower or any of
its Significant Subsidiaries regarding potential liability under any
Environmental Law that, singly or in the aggregate, may reasonably
be expected to result in a Material Adverse Effect;
(c) there are no unremediated Releases of Hazardous Materials at,
on or under any property now or previously owned or leased by the
Borrower or any of its Significant Subsidiaries that, singly or in the
aggregate, result in, or may reasonably be expected to result in, a
Material Adverse Effect;
57
(d) the Borrower and its Significant Subsidiaries have been issued
and are in material compliance with all permits, certificates, approvals,
licenses and other authorizations relating to environmental matters and
necessary for their businesses;
(e) no property now or previously owned or leased by the Borrower or
any of its Significant Subsidiaries is listed or proposed for listing
(with respect to owned property only) on the National Priorities List
pursuant to CERCLA, on the CERCLIS or on any similar state list of sites
requiring investigation or clean-up;
(f) there are no underground storage tanks, active or abandoned,
including petroleum storage tanks, on or under any property now or
previously owned or leased by the Borrower or any of its Significant
Subsidiaries that, singly or in the aggregate, result in, or may
reasonably be expected to result in, a Material Adverse Effect;
(g) neither Borrower nor any Significant Subsidiary of the Borrower
has directly transported or directly arranged for the transportation of
any Hazardous Material to any location which is listed or proposed for
listing on the National Priorities List pursuant to CERCLA, on the
CERCLIS or on any similar state list or which is the subject of federal,
state or local enforcement actions or other investigations which may lead
to material claims against the Borrower or such Significant Subsidiary
thereof for any remedial work, damage to natural resources or personal
injury, including claims under CERCLA;
(h) there are no polychlorinated biphenyls or friable asbestos
present at any property now or previously owned or leased by the Borrower
or any Significant Subsidiary of the Borrower that, singly or in the
aggregate, result in, or may reasonably be expected to result in, a
Material Adverse Effect; and
(i) no conditions exist at, on or under any property now or
previously owned or leased by the Borrower which, with the passage of
time, or the giving of notice or both, would give rise to liability under
any Environmental Law which would reasonably be expected to result in a
Material Adverse Effect.
SECTION 7.13. Regulations U and X. The Borrower is not engaged in the
business of extending credit for the purpose of purchasing or carrying margin
stock, and no proceeds of any Loans will be used for a purpose which violates
F.R.S. Board Regulation U or X. Terms for which meanings are provided in F.R.S.
Board Regulation U or X or any regulations substituted therefor, as from time
to time in effect, are used in this Section with such meanings.
SECTION 7.14. Accuracy of Information. All factual information (which
shall not include projections) heretofore or contemporaneously furnished by or
on behalf of the Borrower in writing to the Agent, any Issuer or any Lender for
purposes of or in connection with this Agreement or any transaction
contemplated hereby is, and all other such factual information hereafter
furnished by or on behalf of the Borrower to the Agent or any Lender will be,
true and accurate in every material respect on the date as of which such
information is dated or certified (except with respect to the financial
statements of Borrower and its Subsidiaries, which will fairly present the
financial condition of the entities covered thereby as of the date thereof)
and,
58
with respect to information provided prior to the execution of this
Agreement, as of the date of execution and delivery of this Agreement by the
Agent and such Lender, and such information is not, or shall not be, as the
case may be, incomplete by omitting to state any material fact necessary to
make such information not misleading.
SECTION 7.15. Protection under Pledge Agreements and Deeds of Trust.
Subject to the exceptions agreed to in the agreed form of such documents, the
Pledge Agreements constitute a valid perfected first priority security interest
in the property subject thereto and the Deeds of Trust, when executed, together
with the financing statements (if any) filed with respect thereto, will
constitute valid, first mortgage liens on, the property subject thereto.
SECTION 7.16. Indebtedness of Certain Subsidiaries. As of the Effective
Date, the only outstanding Indebtedness of any of Calpine Holdings and its
Subsidiaries, CNGGP, CNGH, QM, JOQ, QCH and CCEC and its Subsidiaries is as set
forth on Item 7.16 of the Disclosure Schedule.
SECTION 7.17. Designation of Subsidiaries. As of the Effective Date,
CCEC and each of its Subsidiaries is an Unrestricted Subsidiary, as such term
is defined in the Xxx-0000 Xxxxxxxxxx.
ARTICLE VIII
COVENANTS
SECTION 8.1. Affirmative Covenants. The Borrower agrees with the Agent
and each Lender that, from and after the Effective Date, until all Commitments
have terminated and all Obligations have been paid and performed in full, the
Borrower will perform the obligations set forth in this Section 8.1.
SECTION 8.1.1. Financial Information, Reports, Notices, etc. The Borrower
will furnish, or will cause to be furnished, to each Lender and the Agent
copies of the following financial statements, reports, notices and information:
(a) as soon as available and in any event within 60 days after the
end of each of the first three Fiscal Quarters of each Fiscal Year of the
Borrower, (i) the consolidated balance sheet, statement of earnings and
cash flow statement of the Borrower and its Subsidiaries for such Fiscal
Quarter and for the period commencing at the end of the previous Fiscal
Year and ending with the end of such Fiscal Quarter, certified by an
Authorized Officer of the Borrower and (ii) a consolidating balance sheet
and a consolidating statement of earnings of the Borrower and its
Subsidiaries for such Fiscal Quarter and for the period commencing at the
end of the previous Fiscal Year and ending with the end of such Fiscal
Quarter, certified by an Authorized Officer of the Borrower;
(b) as soon as available and in any event within 120 days after
the end of each Fiscal Year of the Borrower, (i) a copy of the annual
audit report for such Fiscal Year for the Borrower and its Subsidiaries,
including therein the consolidated balance sheet, statement of earnings
and cash flow statement of the Borrower and its Subsidiaries as of the
end of such Fiscal Year, in each case certified (without any
Impermissible
59
Qualification) in a manner acceptable to the Agent and the Required
Lenders by Xxxxxx Xxxxxxxx & Company or other independent public
accountants acceptable to the Agent and the Required Lenders and (ii) a
consolidating balance sheet and a consolidating statements of earnings of
the Borrower and its Subsidiaries as of the end of such Fiscal Year,
certified by an Authorized Officer of the Borrower;
(c) as soon as available and in any event within 60 days after the
end of each of the first three Fiscal Quarters of each Fiscal Year and
within 120 days after the end of each Fiscal Year, a certificate,
executed by an Authorized Officer of the Borrower, showing (in reasonable
detail and with appropriate calculations and computations in all respects
satisfactory to the Agent) compliance with the financial covenants set
forth in Sections 6.3.4 and 8.2.4;
(d) as soon as available and in any event within ninety days after
the end of each Fiscal Year of the Borrower, a consolidated budget for the
Borrower and its Subsidiaries for the following Fiscal Year, in form and
substance satisfactory to the Agent;
(e) if the Interest Coverage Ratio (Parent Only), calculated as of
the end of the most recently ended Fiscal Quarter, had previously fallen
below 1.70 to 1.00 and had not subsequently returned to 1.70 to 1.00 or
better, as soon as available and in any event within 30 days after the end
of each calendar month thereafter, a certificate, executed by an
Authorized Officer of the Borrower, showing (in reasonable detail and with
appropriate calculations and computations in all respect satisfactory to
the Agent) the calculation of the Interest Coverage Ratio (Parent Only) as
of the end of such calendar month;
(f) as soon as possible and in any event within three days after the
Borrower obtains knowledge of each Default, a statement of an Authorized
Officer of the Borrower setting forth details of such Default and the
action which the Borrower has taken and proposes to take with respect
thereto;
(g) as soon as possible and in any event within five days after (x)
the Borrower obtains knowledge of any adverse development with respect to
any litigation, action, proceeding, or labor controversy described in
Section 7.7, (y) the commencement of any labor controversy, litigation,
action, proceeding of the type described in Section 7.7, or (z) any other
Material Adverse Effect, notice thereof and copies of all documentation
relating thereto;
(h) promptly after the sending or filing thereof, copies of all
reports which the Borrower sends to any of its securityholders, and all
reports and registration statements which the Borrower or any of its
Significant Subsidiaries files with the Securities and Exchange
Commission or any national securities exchange;
(i) immediately upon the Borrower's knowledge of the institution
of any steps by the Borrower or any member of its Controlled Group to
terminate any Pension Plan, or the failure to make a required
contribution to any Pension Plan if such failure is
60
sufficient to give rise to a Lien under section 302(f) of ERISA, or the
taking of any action with respect to a Pension Plan which could result in
the requirement that the Borrower furnish a bond or other security to the
PBGC or such Pension Plan, or the occurrence of any event with respect to
any Pension Plan which could result in the incurrence by the Borrower of
any material liability, fine or penalty, or any material increase in the
contingent liability of the Borrower with respect to any post-retirement
Welfare Plan benefit, notice thereof and copies of all documentation
relating thereto; and
(j) such other information respecting the condition or operations,
financial or otherwise, of the Borrower or any of its Significant
Subsidiaries as any Lender through the Agent may from time to time
reasonably request and which the Borrower is legally permitted to provide
to such Lender.
The Borrower may provide some or all of the information required in clauses (a)
and (b) above by providing copies of its Forms 10-Q and/or 10-K filed with the
Securities and Exchange Commission.
SECTION 8.1.2. Compliance with Laws, etc. The Borrower will, and will
cause each of its Subsidiaries to, comply in all material respects with all
applicable laws, rules, regulations and orders, such compliance to include
(without limitation):
(a) the maintenance and preservation of its corporate existence and,
if applicable, qualification as a foreign corporation; and
(b) the payment, before the same become delinquent, of all taxes,
assessments and governmental charges imposed upon it or upon its
property except to the extent being diligently contested in good faith by
appropriate proceedings and for which adequate reserves in accordance
with GAAP shall have been set aside on its books.
SECTION 8.1.3. Maintenance of Properties. The Borrower will, and will
cause each of its Subsidiaries to, maintain, preserve, protect and keep its
material properties in good repair, working order and condition, and make
necessary and proper repairs, renewals and replacements so that its business
carried on in connection therewith may be properly conducted at all times
unless the Borrower determines in good faith that the continued maintenance of
any of its properties is no longer economically desirable.
SECTION 8.1.4. Insurance. The Borrower will, and will cause each of its
Subsidiaries to, maintain or cause to be maintained with responsible insurance
companies insurance with respect to its properties and business (including
business interruption insurance) against such casualties and contingencies and
of such types and in such amounts as is customary in the case of similar
businesses and will, upon request of the Agent, furnish to each Lender at
reasonable intervals a certificate of an Authorized Officer of the Borrower
setting forth the nature and extent of all insurance maintained by the Borrower
and its Subsidiaries in accordance with this Section.
SECTION 8.1.5. Books and Records. The Borrower will, and will cause each
of its Subsidiaries to, keep books and records which accurately reflect all of
its business affairs and transactions and permit the Agent or any of its
representatives or any Lender, at reasonable times and intervals, to visit all
of its offices, to discuss its financial matters with its officers and
61
independent public accountant (and the Borrower hereby authorizes such
independent public accountant to discuss the Borrower's financial matters with
either Administrative Agent or its representatives whether or not any
representative of the Borrower is present) and to examine (and, at the expense
of the Borrower, photocopy extracts from) any of its books or other corporate
records. The Borrower shall pay any fees of such independent public accountant
incurred in connection with the exercise by either Administrative Agent of its
rights pursuant to this Section; provided, however, after the occurrence and
during the continuance of any Default, the Borrower shall pay for all fees of
such independent accountants incurred with each exercise by the Administrative
Agents or any Lender of its rights pursuant to this Section.
SECTION 8.1.6. Environmental Covenant. The Borrower will, and will cause
each of its Significant Subsidiaries to,
(a) use and operate all of its facilities and properties in material
compliance with all Environmental Laws, keep all necessary permits,
approvals, certificates, licenses and other authorizations relating to
environmental matters in effect and remain in material compliance
therewith, and handle all Hazardous Materials in material compliance with
all applicable Environmental Laws;
(b) immediately notify the Agent and provide copies upon receipt of
all material written claims, complaints, notices or inquiries relating to
the condition of its facilities and properties or compliance with
Environmental Laws; and
(c) provide such information and certifications which the Agent may
reasonably request from time to time to evidence compliance with this
Section 8.1.6.
SECTION 8.1.7. Dividends of Subsidiaries. Promptly upon (but in no case
more than five (5) Business Days after) the occurrence of an Event of Default,
the Borrower shall cause each of its Wholly Owned Subsidiaries to declare and
pay dividends on, or to make payments or distributions on account of, the
shares of all classes of stock of such entity in an amount equal to (x) all
funds legally and contractually available at such time to such Subsidiary for
the payment of dividends minus (y) without duplication, such Wholly Owned
Subsidiary's budgeted working capital and budgeted cash requirements for the
following six months.
SECTION 8.1.8. Domestic Gas Reserves. The Borrower will use commercially
reasonable efforts to cause the Domestic Gas Reserves to be transferred to it as
soon as possible. In any event, on or before May 25, 2002, all or substantially
all of the Domestic Gas Reserves shall have been transferred to the Borrower
pursuant to a transaction reasonably satisfactory to the Administrative Agents
and Agent shall have contemporaneously received executed counterparts of Deeds
of Trust with respect to each Domestic Gas Reserve, duly executed by each of the
owners of such Domestic Gas Reserve, together with
(a) evidence of the completion (or satisfactory arrangements for the
completion) of all recordings and filings of each of the Deeds of Trust
as may be necessary or, in the reasonable opinion of the Agent, desirable
effectively to record the Deeds of Trust as valid, perfected Liens against
the Domestic Gas Reserves, which Liens
62
are subject to no outstanding monetary Liens recorded against the
Domestic Gas Reserves;
(b) title opinions (collectively, the "title opinions") in form and
substance reasonably satisfactory to the Agent and issued by Persons
reasonably acceptable to the Agent, with respect to not less than 90%
of the value of properties subject to the Deeds of Trust;
(c) such other approvals, opinions, or documents (including, without
limitation, environmental reports) in connection with the foregoing
as the Agent may reasonably request; and
(d) the Hazardous Materials Indemnity duly executed by the Borrower,
together with a legal opinion in a form reasonably satisfactory to
the Administrative Agents in respect thereof.
SECTION 8.1.9. CCFCI. On or before June 8, 2002, the stock of Calpine
Holdings shall have been transferred to CNGH pursuant to a transaction
reasonably satisfactory to the Administrative Agents. Upon completion of such
transfer, CCFCI shall be an indirect, Wholly-Owned Subsidiary of CNGH.
Concurrently with the effectiveness of such transfer, the Agent shall release
its pledge of the stock of Calpine Holdings obtained pursuant to the terms of
one of the Pledge Agreements.
SECTION 8.1.10. Intercompany Notes. The Borrower will, promptly upon the
creation of any Indebtedness owing from any of its Dedicated Subsidiaries,
cause such Indebtedness to be evidenced by a promissory note and pledged to the
Agent, on terms reasonably acceptable to the Agent, as collateral security for
the Obligations.
SECTION 8.1.11. Ownership Interests. The Borrower shall at all times
directly or indirectly own 100% of all equity interests of CCEC, which shall,
in turn, directly or indirectly own 100% of the equity interests in Calpine
Canada Natural Gas Partnership and Calpine Saltend Energy Centre, PLC. Calpine
Canada Natural Gas Partnership shall at all times own all of the Canadian Gas
Reserves. The Borrower shall at all times own 100% of the equity interests of
CNGGP and CNGH, and CNGGP and CNGH shall own 100% of the equity interests of
CNGC until CNGC is dissolved. Calpine Holdings shall at all times own 100% of
the equity interests of CCFCI.
SECTION 8.2. Negative Covenants. The Borrower agrees with the Agent and
each Lender that, from and after the Effective Date until all Commitments have
terminated and all Obligations have been paid and performed in full, the
Borrower will perform the obligations set forth in this Section 8.2.
SECTION 8.2.1. Business Activities. The Borrower will not, and will not
permit any of its Subsidiaries or Joint Ventures to, engage in any business
activity, except those described in the first recital and such activities as
may be incidental or related thereto; provided, however, that up to ten percent
(10%) of the consolidated net assets of the Borrower and its Subsidiaries may
be used for unrelated businesses.
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SECTION 8.2.2. Indebtedness. The Borrower will not, and will not permit
any of its Subsidiaries to, create, incur, assume or suffer to exist or
otherwise become or be liable in respect of any Indebtedness, other than,
without duplication, the following:
(a) Indebtedness created in connection with any Loan Document and
any Indebtedness existing as of the Effective Date which is identified in
Item 8.2.2(a) ("Ongoing Indebtedness") of the Disclosure Schedule;
(b) Indebtedness which is incurred by the Borrower or any of the
Borrower's Subsidiaries to a vendor of any assets to finance the
acquisition of such assets so long as the only recourse of such
vendor is to some or all of the assets so financed and, in the case
of a Special Purpose Subsidiary that has acquired such assets, to
the stock or other ownership interests of such Special Purpose
Subsidiary;
(c) unsecured Indebtedness incurred in the ordinary course of
business (including open accounts extended by suppliers on normal trade
terms in connection with purchases of goods and services, but
excluding Indebtedness incurred through the borrowing of money or
Contingent Liabilities);
(d) Indebtedness of the Borrower which is owed to and held by a
Restricted Subsidiary (it being understood and agreed that the
obligations of the Borrower under its subordinated debt securities
issued to a Trust in connection with the Guaranteed Preferred
Securities are not considered Indebtedness for purposes of this
Agreement) and Indebtedness of a Restricted Subsidiary which is
owed to and held by the Borrower or a Restricted Subsidiary;
provided, however, that any subsequent transfer of such
Indebtedness (other than to the Borrower or a Restricted
Subsidiary) shall be deemed, in each case, to constitute the
incurrence of such Indebtedness by the Borrower or by a Restricted
Subsidiary, as the case may be;
(e) Indebtedness of one or more Subsidiaries of the Borrower
incurred solely to finance the development, construction or purchase of,
or repairs, expansions, enhancements, improvements or additions to,
the assets of such Subsidiaries so long as (i) the principal amount
of any such Indebtedness (x) for development of existing gas
reserves does not exceed an aggregate of $50,000,000 for any such
existing reserves or (y) for expansions, enhancements, improvements
or additions to an existing asset which has already achieved
commercial operation does not exceed an aggregate of $60,000,000
for any single financing or series of related financings for such
asset (exclusive of up to $250,000,000 of Indebtedness for the
expansion of the energy center at Zion, Illinois) and (ii) recourse
for any such Indebtedness is limited solely (A) to the asset or
assets being financed, (B) to such Subsidiaries themselves, where
the asset or assets being financed constitute all or substantially
all of the assets of such Subsidiaries (each, a "Special Purpose
Subsidiary"), and/or (C) to the stock or other ownership
interests in such Special Purpose
Subsidiaries;
(f) Indebtedness in respect of Capitalized Lease Liabilities,
unsecured Subordinated Debt of the Borrower and other unsecured
Indebtedness of the Borrower or a Subsidiary if, after giving effect to
the issuance thereof, the Interest Coverage Ratio
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calculated as of the end of the most recent Fiscal Quarter on a pro forma
basis is equal to or greater than 2.00 to 1.00;
(g) Indebtedness secured by property or assets acquired by, or owned
by any Person acquired by, the Borrower or any of its Subsidiaries
that was in existence at the time such property, assets or Person
are acquired so long as such Indebtedness was not incurred in
contemplation of such acquisition; provided, however, that the
Borrower would have been able to incur such Indebtedness at the
time of incurrence thereof pursuant to clause (f) above (assuming
for purposes of this proviso that such Indebtedness was unsecured);
(h) unsecured Indebtedness of the Borrower or any of its
Subsidiaries arising from the endorsements of instruments for collection
in the ordinary course of business;
(i) unsecured Indebtedness of the Borrower or any of its
Subsidiaries with respect to surety, appeal, indemnity, performance or
other similar bonds in the ordinary course of business;
(j) unsecured Hedging Obligations and unsecured Contingent
Liabilities of the Borrower or any of its Subsidiaries, in the ordinary
course of business and consistent with applicable risk management
guidelines established by the Borrower from time to time;
(k) Indebtedness in respect of commercial paper issued and sold in
the commercial paper market in an aggregate principal or stated amount
not to exceed the sum of (i) the stated amount of any letters of
credit issued under the Existing Credit Agreement to support or
secure such commercial paper plus (ii) the unused availability
under this Agreement;
(l) Indebtedness under the Existing Credit Agreement; and
(m) extensions, renewals and refinancings of any of the foregoing
permitted Indebtedness (except with respect to the Loans and other
Obligations referred to in clause (j) above); provided that the
outstanding principal amount of such Indebtedness is not increased,
no obligor under such Indebtedness is liable for any such
Indebtedness except to the extent it was liable for the
Indebtedness so renewed or refinanced and if the Indebtedness being
refinanced is subordinated to the Indebtedness of any obligor, such
Indebtedness shall be subordinated at least to the same extent;
provided, further, that the limitations set forth in this clause
(m) shall not apply to Indebtedness which is otherwise permitted
under this Section 8.2.2, even if such Indebtedness is used to
repay or refinance other existing Indebtedness.
provided, however, that no Indebtedness otherwise permitted by clauses (d),
(f), (g), (j) or (k) shall be permitted if, after giving effect to the
incurrence thereof, any Default (other than a Nonmaterial Subsidiary Default)
shall have occurred and be continuing and provided further that in no event
shall Calpine Holdings, QM, JOQ or QCH or any of their respective Subsidiaries
(except Calpine Canada Power Holdings Ltd. and its Subsidiaries) create, incur,
assume or suffer to exist or otherwise become or be liable in respect of any
Indebtedness other than, without
65
duplication, (x) Indebtedness permitted by clauses (a), (b), (c), (h), (i) and
(m) of this Section 8.2.2, (y) $85,000,000 of unsecured Indebtedness of Calpine
Saltend Energy Centre, PLC and (z) up to $15,000,000 of other unsecured
Indebtedness. Notwithstanding the foregoing, in no event shall QM, JOQ, QCH or
CCEC incur any Indebtedness of any type whatsoever after the Effective Date,
other than Indebtedness pursuant to the Loan Documents.
SECTION 8.2.3. Liens. The Borrower will not, and will not permit any of its
Subsidiaries to, create, incur, assume or suffer to exist any Lien upon any of
its property, revenues or assets, whether now owned or hereafter acquired,
except:
(a) Liens securing payment of the Obligations granted pursuant to any
Loan Document and Liens securing payment of the obligations granted
pursuant to the loan documents relating to the Existing Credit
Agreement;
(b) Liens granted prior to the Effective Date to secure payment of
Indebtedness of the type permitted and described in clause (a) of
Section 8.2.2;
(c) Liens granted to secure payment of Indebtedness of the type
permitted and described in clause (b) of Section 8.2.2 where
recourse is limited as described in clause (b) of Section 8.2.2;
(d) Liens for taxes, assessments or other governmental charges or
levies not at the time delinquent or thereafter payable without
penalty or being diligently contested in good faith by appropriate
proceedings and for which adequate reserves in accordance with GAAP
shall have been set aside on its books;
(e) Liens of carriers, warehousemen, mechanics, materialmen and
landlords incurred in the ordinary course of business for sums not
overdue or being diligently contested in good faith by appropriate
proceedings and for which adequate reserves in accordance with GAAP
shall have been set aside on its books;
(f) Liens incurred in the ordinary course of business in connection
with workmen's compensation, unemployment insurance or other forms
of governmental insurance or benefits, or to secure performance of
tenders, statutory obligations, leases and contracts (other than
for borrowed money) entered into in the ordinary course of business
or to secure obligations on surety or appeal bonds;
(g) judgment Liens in existence less than 15 days after the entry
thereof or with respect to which execution has been stayed or the
payment of which is covered in full (subject to a customary
deductible) by insurance maintained with responsible insurance
companies;
(h) Liens granted to secure payment of Indebtedness of the type
permitted and described in clauses (e) and (g) of Section 8.2.2
where recourse is limited as described in clauses (e) or (g), as
applicable, of Section 8.2.2;
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(i) Zoning restrictions, easements, rights of way, title
irregularities and other similar encumbrances which alone or in the
aggregate do not materially detract from the value of the property subject
thereto;
(j) Liens on the property or assets of any Subsidiary of the
Borrower in favor of the Borrower;
(k) Banker's Liens and similar Liens (including set-off rights) in
respect of bank deposits;
(l) Landlord's Liens and similar Liens in respect of leased property;
(m) Liens securing Attributable Debt with respect to outstanding
leases entered into pursuant to Sale/Leaseback Transactions so long as,
with respect to Sale/Leaseback Transactions closing after January 1,
2002, the amount thereof does not exceed 10% of the consolidated tangible
assets of the Borrower and its Subsidiaries; and
(n) Liens incurred in connection with the extension, renewal or
refinancing of Indebtedness secured by Liens permitted and described in
clauses (b), (c) and (h) of this Section 8.2.3; provided, however, that
(x) such new Lien shall be limited to all or part of the same property
that secured the original Lien and (y) the Indebtedness secured by such
Lien at such time is not increased (other than by an amount necessary to
pay fees and expenses, including premiums, related to the refinancing,
refunding, extension, renewal or replacement of such Indebtedness);
provided, further, that the limitations set forth in this clause (n)
shall not apply to Liens which are otherwise permitted under this Section
8.2.3, even if such Liens secure Indebtedness issued to repay or
refinance existing Indebtedness permitted and described in clauses (b),
(c) and (h) of this Section 8.2.3.
Without limitation of the foregoing, in no event shall Calpine Holdings,
QM, JOQ, QCH or any of their Subsidiaries (except Calpine Canada Power
Holdings Ltd. and its Subsidiaries) create, incur, assume or suffer to
exist a Lien upon any of its property, revenues, or assets, whether now
owned or hereafter acquired, except for Liens permitted by clauses (a)
through (g), (i) through (l) and (n) of this Section 8.2.3, and in no
event shall QM, JOQ, QCH or CCEC create any Liens of any type whatsoever
after the Effective Date, except for Liens created pursuant to Loan
Documents.
SECTION 8.2.4. Financial Condition. The Borrower will not permit:
(a) Its Tangible Net Worth to be less than (i) $820,699,000 plus (ii)
50% of the Consolidated Net Income of the Borrower and its
Subsidiaries (without giving effect to any losses) for each Fiscal
Quarter ending on or after December 31, 1999 plus (iii) 100% of the Net
Equity Proceeds from any equity offering by the Borrower after May 23,
2000.
(b) Its Leverage Ratio to be greater than .85 to 1.00 as of the end
of any Fiscal Quarter.
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(c) Its Interest Coverage Ratio as of the end of any Fiscal Quarter,
to be less than 1.75 to 1.00 for the twelve (12) month period comprising
the four previous Fiscal Quarters.
(d) Its Interest Coverage Ratio (Parent Only) as of the end of any
Fiscal Quarter, to be less than 1.60 to 1.00 for the twelve (12) month
period comprising the four previous Fiscal Quarters.
SECTION 8.2.5. Investments. The Borrower will not, and will not permit any
of its Subsidiaries to, make, incur, assume or suffer to exist any Investment
in any other Person, except:
(a) Investments existing on the Effective Date;
(b) Cash Equivalent Investments or Investments (as defined in the
Xxx-0000 Xxxxxxxxxx) by a Restricted Subsidiary in the Borrower or any
other Restricted Subsidiary;
(c) Investments by the Borrower in any of its Subsidiaries or in any
Investment Joint Venture of the Borrower or Investments by the Borrower's
Subsidiaries in other Subsidiaries or in any Investment Joint Venture of
the Borrower, whether now existing or hereafter organized in permitted
lines of business of the Borrower and its Subsidiaries and lines of
business related thereto by way of contributions to capital or loans or
advances (including guarantees and other forms of Contingent Liabilities
to the extent that the occurrence of the obligations being guaranteed or
supported would otherwise be permitted hereunder); and
(d) from and after the Effective Date, in the ordinary course of
business, Investments by the Borrower or any of its Subsidiaries in
Persons that are not Subsidiaries of the Borrower or Investment Joint
Ventures of the Borrower so long as such Persons are engaged only in
permitted lines of business of the Borrower and its Subsidiaries and
lines of business related thereto and so long as no such single
Investment (or series of related Investments) exceeds 5% of the
Borrower's consolidated tangible assets as of the end of the most recent
Fiscal Quarter for which the Borrower has delivered the financial
statements required under Section 8.1.1 hereof and the aggregate of all
such Investments at any time outstanding does not exceed 10% of the
Borrower's consolidated tangible assets as of the end of the most recent
Fiscal Quarter for which the Borrower has delivered the financial
statements required under Section 8.1.1 hereof;
provided, however, that
(e) any Investment which when made complies with the requirements of
the definition of the term "Cash Equivalent Investment" may continue to
be held notwithstanding that such Investment if made thereafter would not
comply with such requirements; and
(f) no Investment otherwise permitted by clauses (c) or (d) shall be
permitted to be made if, immediately before or after giving effect
thereto, any Material Adverse
68
Effect or any Default (other than a Nonmaterial Subsidiary Default) shall
have occurred and be continuing.
SECTION 8.2.6. Restricted Payments, etc. On and at all times after the
Effective Date:
(a) the Borrower will not declare, pay or make any dividend or
distribution (in cash, property or obligations) on any shares of any
class of capital stock (now or hereafter outstanding) of the Borrower or
on any warrants, options or other rights with respect to any shares of
any class of capital stock (now or hereafter outstanding) of the Borrower
(other than dividends or distributions payable in its common stock or
warrants to purchase its common stock or splitups or reclassifications of
its stock into additional or other shares of its common stock) or apply,
or permit any of its Subsidiaries (other than Restricted Subsidiaries) to
apply, any of its funds, property or assets to the purchase, redemption,
sinking fund or other retirement of, or agree or permit any of its
Subsidiaries (other than Restricted Subsidiaries) to purchase or redeem,
any shares of any class of capital stock (now or hereafter outstanding)
of the Borrower, or warrants, options or other rights with respect to any
shares of any class of capital stock (now or hereafter outstanding) of
the Borrower;
(b) the Borrower will not, and will not permit any of its
Subsidiaries to
(i) make any payment or prepayment of principal of, or make
any payment of interest on, any Senior Notes or any Subordinated
Debt on any day other than the stated date for such payment or
prepayment set forth in the documents and instruments memorializing
any Senior Notes or such Subordinated Debt, or which would violate
the subordination provisions of any such Subordinated Debt;
provided, that the Borrower may pay or prepay all or a portion of
the Senior Notes if both before and after giving effect thereto, no
Default shall have occurred or be continuing and there are no Loans
outstanding hereunder; and provided further, that the Borrower may
make optional purchases, redemptions or prepayments of the Zero
Coupon Debentures if both before and after giving effect thereto, no
Default shall have occurred and be continuing; or
(ii) redeem, purchase or defease any Senior Notes or any
Subordinated Debt unless the effect of such redemption, purchase or
defeasance is to make a payment or prepayment permitted under clause
(b)(i);
(c) the Borrower will not, and will not permit any Subsidiary to,
make any deposit for any of the foregoing purposes except to the
extent a payment or prepayment would be otherwise permitted
hereunder; and
(d) the Borrower will not, and will not permit any of its
Subsidiaries to, make any voluntary prepayment of principal of any
Indebtedness (other than payments by any Subsidiary on Indebtedness owed
to the Borrower or any Restricted Subsidiary), if either before or after
giving effect thereto, there shall exist a Default (other than a
Nonmaterial Subsidiary Default) or an Event of Default.
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SECTION 8.2.7. Capital Expenditures and Investments. The Borrower will
not make or commit to make Capital Expenditures for or Investments in, or
in connection with, any new project (other than Capital Expenditures or
Investments (as defined in the Xxx-0000 Xxxxxxxxxx) made through one or more
Restricted Subsidiaries) if a Default (other than a Nonmaterial Subsidiary
Default) or Event of Default shall have occurred and be continuing; provided,
however, that if on the date of any such Default, the Borrower is contractually
obligated to make such a Capital Expenditure or Investment, the Borrower shall
be permitted to make such Capital Expenditure or Investment.
SECTION 8.2.8. Rental Obligations. The Borrower will not enter into at
any time any arrangement which does not create a Capitalized Lease
Liability or a Sale/Leaseback Transaction and which involves the leasing by the
Borrower from any lessor of any real or personal property (or any interest
therein), except arrangements which, together with all other such arrangements
which shall then be in effect, will not require the payment of an aggregate
amount of rentals by the Borrower in excess of (excluding escalations resulting
from a rise in the consumer price or similar index) $25,000,000 in any Fiscal
Year; provided, however, that any calculation made for purposes of this Section
shall exclude any amounts required to be expended for maintenance and repairs,
insurance, taxes, assessments, and other similar charges.
SECTION 8.2.9. Consolidation, Merger, etc. The Borrower will not, and
will not permit any of its Subsidiaries to, liquidate or dissolve, consolidate
with, or merge into or with, any other corporation, or purchase or otherwise
acquire all or substantially all of the assets of any Person (or of any
division thereof) except
(a) the Borrower or a Wholly Owned Subsidiary may merge with another
Person if (i) (A) Borrower or such Subsidiary is the continuing Person
following such merger or (B) in the case of a merger by the Borrower, the
Person (if other than the Borrower) formed by such merger (including a
consolidation effected by a sale or transfer of all or substantially all
of the assets of a Person) is a corporation organized and existing under
the laws of the United States or any State thereof or the District of
Columbia and expressly assumes the obligations of the Borrower under this
Agreement, (ii) such merger or consolidation is otherwise permitted under
the Senior Note Indentures, (iii) no Default (other than a Nonmaterial
Subsidiary Default) has occurred and is continuing or would occur after
giving effect thereto and (iv) after giving effect thereto, (x) the S&P
Rating of the Borrower shall not be reduced below BB- and Xxxxx'x Rating
of the Borrower shall not be reduced below Ba3 or, (y) if the Borrower
shall not be the survivor, the S&P Rating of such survivor shall not be
below BBB- and Xxxxx'x Rating of such survivor shall not be below Baa3;
(b) any such Subsidiary may liquidate or dissolve voluntarily into,
and may merge with and into, the Borrower or any other Subsidiary, and
the assets or stock of any Subsidiary may be purchased or otherwise
acquired by the Borrower or any other Subsidiary; provided, however, in
no event may a Subsidiary that holds a direct interest in a power
generating facility merge with any other Subsidiary that holds a direct
or indirect interest in any other power generating facility or other
business;
70
(c) so long as no Default (other than a Nonmaterial Subsidiary
Default) has occurred and is continuing or would occur after giving
effect thereto, the Borrower or any of its Subsidiaries may purchase all
or substantially all of the assets or stock of any Person if permitted
(without duplication) by Section 8.2.5 and Section 8.2.7; and
(d) a Restricted Subsidiary may consolidate with, or merge into or
with, or purchase or otherwise acquire all or substantially all the
assets of, another Restricted Subsidiary.
SECTION 8.2.10. Asset Dispositions, etc. The Borrower will not, and will
not permit any of its Subsidiaries to, sell, transfer, lease, contribute or
otherwise convey, or grant options, warrants or other rights with respect to,
all or any substantial part of its assets (including accounts receivable and
capital stock of Subsidiaries) to any Person other than to the Borrower or a
Restricted Subsidiary, unless
(a) such sale, transfer, lease, contribution or conveyance is in the
ordinary course of its business or is permitted by Section 8.2.9; or
(b) such sale, transfer, lease, contribution or conveyance is not
covered by clause (a) above and (i) the Borrower or its Subsidiary
receives consideration at the time of such sale, transfer, lease,
contribution or conveyance at least equal to the fair market value of
assets being sold, transferred, leased, contributed or conveyed (ii) at
least sixty percent (60%) of the consideration received by the Borrower
or such Subsidiary is in the form of cash or cash equivalents, and (iii)
an amount equal to 100% of Net Available Cash is either reinvested in
Additional Assets within 365 days of such asset sale or applied by the
Borrower pursuant to Section 2.2.2(a) to prepay the Loans and the loans
outstanding under the Existing Credit Agreement, so long as any Net
Available Cash from Dedicated Assets is applied by the Borrower pursuant
to Section 2.2.2(a).
SECTION 8.2.11. Modification of Certain Agreements. The Borrower will not
consent to any amendment, supplement or other modification of any of the terms
or provisions contained in, or applicable to, the Senior Notes or the Senior
Note Indentures, or any document or instrument evidencing or applicable to any
Subordinated Debt, other than any amendment, supplement or other modification
which extends the date, reduces the amount of any required repayment or
redemption, or cures any ambiguity, omission, defect or inconsistency in any
Senior Notes issued thereunder so long as such a cure is not adverse to the
interests of the Lenders.
SECTION 8.2.12. Transactions with Affiliates. Except for transactions
between the Borrower and its Wholly Owned Subsidiaries or Cogen America or
between one Wholly Owned Subsidiary and another Wholly Owned Subsidiary or
Cogen America, the Borrower will not, and will not permit any of its
Subsidiaries to, enter into, or cause, suffer or permit to exist any
arrangement or contract with any of its other Affiliates unless such
arrangement or contract is fair and equitable to the Borrower or such
Subsidiary and is an arrangement or contract of the kind which would be entered
into by a prudent Person in the position of the Borrower or such Subsidiary
with a Person which is not one of its Affiliates.
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SECTION 8.2.13. Negative Pledges, Restrictive Agreements, etc. The Borrower
will not, and will not permit any of its Subsidiaries to, enter into any
agreement (excluding this Agreement, any other Loan Document and any agreement
governing any Indebtedness permitted either by clauses (a), (b), (e), (f), (g)
and (l) of Section 8.2.2 (and refinancings, extensions and renewals of such
Indebtedness permitted under clause (m) of Section 8.2.2) or any agreements in
respect of Sale/Leaseback Transactions permitted by clause (m) of Section
8.2.3) prohibiting
(a) the creation or assumption of any Lien upon its properties,
revenues or assets, whether now owned or hereafter acquired, or the
ability of the Borrower or any other Obligor to amend or otherwise modify
this Agreement or any other Loan Document; or
(b) the ability of any Subsidiary to make any payments, directly or
indirectly, to the Borrower by way of dividends, advances, repayments of
loans or advances, reimbursements of management and other intercompany
charges, expenses and accruals or other returns on investments, or any
other agreement or arrangement which restricts the ability of any such
Subsidiary to make any payment, directly or indirectly, to the Borrower.
SECTION 8.2.14. Amendments to Canadian Documentation. The Borrower will
not, and will not permit CCEC, CCEF or QCH, to amend the contractual
arrangements among CCEC, QCH and CCEF in respect of the term debentures dated
April 25, 2001, August 14, 2001 and August 23, 2001 between CCEC and CCEF and
the documentation executed in connection therewith or the memorandum of
association or articles of association of CCEC without the prior written
consent of the Administrative Agents and the Term B Lead Arrangers, which
consent shall not be unreasonably withheld or delayed. The Borrower will not
permit any amendments to be made to the articles of incorporation of any
Guarantor without the prior written consent of the Administrative Agents and
the Term B Lead Arrangers, which consent shall not be unreasonably withheld or
delayed.
SECTION 8.3. No Restriction on Payments to the Borrower. Nothing herein
shall restrict the ability of any Subsidiary of the Borrower to make any
payment by way of dividends, advances, repayments of loans or advances,
reimbursements of management and other intercompany charges, expenses and
accruals or other returns on investments or any other payment, directly or
indirectly, to the Borrower.
ARTICLE IX
EVENTS OF DEFAULT
SECTION 9.1. Listing of Events of Default. Each of the following events
or occurrences described in this Section 9.1 shall constitute an "Event of
Default".
SECTION 9.1.1. Non-Payment of Obligations. The Borrower shall default in
the payment or prepayment when due of any principal of any Loan, the Borrower
shall default in the payment when due of any Reimbursement Obligation, or the
Borrower shall default (and such
72
default shall continue unremedied for a period of five days) in the payment
when due of interest on any Loan, any fee or of any other Obligation.
SECTION 9.1.2. Breach of Warranty. Any representation or warranty of the
Borrower or any other Obligor made or deemed to be made hereunder or in any
other Loan Document executed by it or any other writing or certificate
furnished by or on behalf of the Borrower or any other Obligor to the Agent or
any Lender for the purposes of or in connection with this Agreement or any such
other Loan Document (including any certificates delivered pursuant to Article
VI) is or shall be incorrect when made in any material respect.
SECTION 9.1.3. Non-Performance of Certain Covenants and Obligations. The
Borrower shall default in the due performance and observance of any of its
obligations under Section 8.2 or the Fee Letter and such default shall continue
unremedied for a period of 10 days after the earlier of (i) actual knowledge
thereof by the Borrower or (ii) notice thereof has been given to the Borrower
by the Agent or by any Lender.
SECTION 9.1.4. Non-Performance of Other Covenants and Obligations. Any
Obligor shall default in the due performance and observance of any other
agreement contained herein or in any other Loan Document executed by it, and
such default shall continue unremedied for a period of 30 days after notice
thereof shall have been given to the Borrower by the Agent or any Lender (or
such longer period as the Required Lenders in their discretion, may agree,
provided that such Obligor has commenced such cure within such 30 day period
and thereafter diligently pursues such cure to completion).
SECTION 9.1.5. Default on Other Indebtedness. A default shall occur in
the payment when due (subject to any applicable grace period), whether by
acceleration or otherwise, of any Indebtedness (other than Indebtedness
described in Section 9.1.1) of the Borrower or any of its Significant
Subsidiaries or any other Obligor having a principal amount, individually or in
the aggregate, in excess of $10,000,000, or a default shall occur in the
performance or observance of any obligation or condition with respect to such
Indebtedness if the effect of such default is to accelerate the maturity of any
such Indebtedness or, in the case of the Borrower only, such default shall
continue unremedied for any applicable period of time sufficient to permit the
holder or holders of such Indebtedness, or any trustee or agent for such
holders, to cause such Indebtedness to become due and payable prior to its
expressed maturity or a default shall occur in the performance or observance of
any obligation or condition with respect to the Borrower's debt securities
issued to a Trust or to any Indebtedness of any Significant Subsidiary or
Obligor, in each case having a principal amount in excess of $10,000,000, and,
as a result thereof, the holder or holders of such debt securities or such
Indebtedness, or any trustee or agent for such holders, causes such securities
or Indebtedness to be repaid more quickly than theretofore scheduled, whether
through the introduction of a "cash sweep," the increase of an existing "cash
sweep" or otherwise.
SECTION 9.1.6. Judgments. Any final judgment or order (not covered by
insurance) for the payment of money shall be rendered against the Borrower or
any Significant Subsidiary or any other Obligor in an amount in excess of
$25,000,000 (or its foreign currency equivalent) (treating any deductibles,
self-insurance or retention as not so covered) which is not stayed or
discharged within 30 days after entry of such final judgment or order, and
there shall be any
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period of more than 30 consecutive days following entry of the final judgment
or order in excess of $25,000,000 (or its foreign currency equivalent) during
which a stay of enforcement of such final judgment or order, by reason of a
pending appeal or otherwise, shall not be in effect.
SECTION 9.1.7. Pension Plans. Any of the following events shall occur with
respect to any Pension Plan
(a) the institution of any steps by the Borrower, any member of its
Controlled Group or any other Person to terminate a Pension Plan if, as a
result of such termination, the Borrower or any such member could be
required to make a contribution to such Pension Plan, or could reasonably
expect to incur a liability or obligation to such Pension Plan, in excess
of $10,000,000; or
(b) a contribution failure occurs with respect to any Pension Plan
sufficient to give rise to a Lien under Section 302(f) of ERISA.
SECTION 9.1.8. Control of the Borrower. Any Change in Control shall
occur.
SECTION 9.1.9. Bankruptcy, Insolvency, etc. The Borrower or any of its
Significant Subsidiaries or any other Obligor shall
(a) become insolvent or generally fail to pay, or admit in writing
its inability or unwillingness to pay, debts as they become due;
(b) apply for, consent to, or acquiesce in, the appointment of a
trustee, receiver, sequestrator or other custodian for the Borrower or
any of its Significant Subsidiaries or any other Obligor or any property
of any thereof, or make a general assignment for the benefit of creditors;
(c) in the absence of such application, consent or acquiescence,
permit or suffer to exist the appointment of a trustee, receiver,
sequestrator or other custodian for the Borrower or any of its
Significant Subsidiaries or any other Obligor or for a substantial part
of the property of any thereof, and such trustee, receiver, sequestrator
or other custodian shall not be discharged within 60 days, provided that
the Borrower, each Significant Subsidiary and each other Obligor hereby
expressly authorizes the Agent and each Lender to appear in any court
conducting any relevant proceeding during such 60-day period to preserve,
protect and defend their rights under the Loan Documents;
(d) permit or suffer to exist the commencement of any bankruptcy,
reorganization, debt arrangement or other case or proceeding under any
bankruptcy or insolvency law, or any dissolution, winding up or
liquidation proceeding, in respect of the Borrower or any of its
Significant Subsidiaries or any other Obligor, and, if any such case or
proceeding is not commenced by the Borrower or such Significant
Subsidiary or such other Obligor, such case or proceeding shall be
consented to or acquiesced in by the Borrower or such Significant
Subsidiary or such other Obligor or shall result in the entry of an order
for relief or shall remain for 60 days undismissed, provided that the
Borrower, each Significant Subsidiary and each other Obligor hereby
expressly authorizes the Agent and each Lender to appear in any court
conducting any such case or proceeding during
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such 60-day period to preserve, protect and defend their rights under the
Loan Documents; or
(e) take any action authorizing any of the foregoing.
SECTION 9.1.10. Impairment of Security, etc. Any Loan Document, or any
Lien granted thereunder, shall (except in accordance with its terms), in whole
or in part, terminate, cease to be effective or cease to be the legally valid,
binding and enforceable obligation of any Obligor party thereto; or the
Borrower, any other Obligor or any Subsidiary shall, directly or indirectly,
contest in any manner such effectiveness, validity, binding nature or
enforceability; or any Lien securing any Obligation shall, in whole or in part,
cease to be a perfected first priority Lien, subject only to those exceptions
expressly permitted by such Loan Document.
SECTION 9.2. Action if Bankruptcy. If any Event of Default described in
clauses (a) through (d) of Section 9.1.9 shall occur with respect to the
Borrower or any Significant Subsidiary or any other Obligor, the Commitments
(if not theretofore terminated) shall automatically terminate and the
outstanding principal amount of all outstanding Loans and all other Obligations
shall automatically be and become immediately due and payable, without notice
or demand.
SECTION 9.3. Action if Other Event of Default. If any Event of Default
(other than any Event of Default described in clauses (a) through (d) of
Section 9.1.9 with respect to the Borrower or any Significant Subsidiary or any
other Obligor) shall occur for any reason, whether voluntary or involuntary,
and be continuing, the Agent, upon the direction of the Required Lenders, shall
by notice to the Borrower declare all or any portion of the outstanding
principal amount of the Loans and other Obligations to be due and payable
and/or the Commitments (if not theretofore terminated) to be terminated,
whereupon the full unpaid amount of such Loans and other Obligations which
shall be so declared due and payable shall be and become immediately due and
payable, without further notice, demand or presentment, and/or, as the case may
be, the Commitments shall terminate and the Agent may thereupon exercise any
and all remedies available under the Loan Documents and applicable law.
ARTICLE X
THE AGENT AND ADMINISTRATIVE AGENTS
SECTION 10.1. Actions. Each Lender hereby appoints Scotiabank as its
Agent and Scotiabank and Citibank as its Administrative Agents under and for
purposes of this Agreement, the Notes and each other Loan Document. Each Lender
authorizes the Agent and Administrative Agents to act on behalf of such Lender
under this Agreement, the Notes and each other Loan Document and, in the
absence of other written instructions from the Required Lenders received from
time to time by such Person (with respect to which such Person agrees that it
will comply, except as otherwise provided in this Section or as otherwise
advised by counsel), to exercise such powers hereunder and thereunder as are
specifically delegated to or required of the Agent and Administrative Agents by
the terms hereof and thereof, together with such powers as may be reasonably
incidental thereto. Each Lender hereby indemnifies (which indemnity shall
survive any termination of this Agreement) the Agent, each Arranger and the
Administrative Agents, pro
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rata according to such Lender's Aggregate Percentage, from and against any and
all liabilities, obligations, losses, damages, claims, costs or expenses of any
kind or nature whatsoever which may at any time be imposed on, incurred by, or
asserted against, the Agent, any Arranger or an Administrative Agent in any way
relating to or arising out of this Agreement, the Notes and any other Loan
Document, including reasonable attorneys' fees, and as to which the Agent, any
Arranger or such Administrative Agent is not reimbursed by the Borrower;
provided, however, that no Lender shall be liable for the payment of any
portion of such liabilities, obligations, losses, damages, claims, costs or
expenses which are determined by a court of competent jurisdiction in a final
proceeding to have resulted from the Agent's, any Arranger's or an
Administrative Agent's, as the case may be, gross negligence or willful
misconduct. The Agent, each Arranger and the Administrative Agent shall not be
required to take any action hereunder, under the Notes or under any other Loan
Document, or to prosecute or defend any suit in respect of this Agreement, the
Notes or any other Loan Document, unless they are indemnified hereunder to its
satisfaction. If any indemnity in favor of the Agent, any Arranger or an
Administrative Agent shall be or become, in such Person's determination,
inadequate, such Person may call for additional indemnification from the
Lenders and cease to do the acts indemnified against hereunder until such
additional indemnity is given.
SECTION 10.2. Funding Reliance, etc. Unless the Agent shall have been
notified by telephone, confirmed in writing, by any Lender by 5:00 p.m., San
Francisco time, on the day prior to a Borrowing that such Lender will not make
available the amount which would constitute its applicable Percentage of such
Borrowing on the date specified therefor, the Agent may assume that such Lender
has made such amount available to the Agent and, in reliance upon such
assumption, make available to the Borrower a corresponding amount. If and to
the extent that such Lender shall not have made such amount available to the
Agent, such Lender and the Borrower severally agree to repay the Agent
forthwith on demand such corresponding amount together with interest thereon,
for each day from the date the Agent made such amount available to the Borrower
to the date such amount is repaid to the Agent, at the interest rate applicable
at the time to Loans comprising such Borrowing.
SECTION 10.3. Exculpation. Neither the Agent, either Administrative
Agent nor any of their respective directors, officers, employees or agents
shall be liable to any Lender for any action taken or omitted to be taken by it
under this Agreement or any other Loan Document, or in connection herewith or
therewith, except for its own willful misconduct or gross negligence, nor
responsible for any recitals or warranties herein or therein, nor for the
effectiveness, enforceability, validity or due execution of this Agreement or
any other Loan Document, nor for the creation, perfection or priority of any
Liens purported to be created by any of the Loan Documents, or the validity,
genuineness, enforceability, existence, value or sufficiency of any collateral
security, nor to make any inquiry respecting the performance by the Borrower of
its obligations hereunder or under any other Loan Document. Any such inquiry
which may be made by the Agent or the Administrative Agents shall not obligate
them to make any further inquiry or to take any action. The Agent and the
Administrative Agents shall be entitled to rely upon advice of counsel
concerning legal matters and upon any notice, consent, certificate, statement
or writing which they believe to be genuine and to have been presented by a
proper Person.
SECTION 10.4. Successor. The Agent or any Administrative Agent may
resign as such at any time upon at least 30 days' prior notice to the Borrower
and all Lenders. If the Agent or
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any Administrative Agent at any time shall resign, the Required Lenders may
appoint another Lender as a successor thereto which shall thereupon become the
Agent or an Administrative Agent, as applicable, hereunder. If no successor
shall have been so appointed by the Required Lenders, and shall have accepted
such appointment, within 30 days after the retiring Agent's or Administrative
Agent's giving notice of resignation, then the retiring Person may, on behalf
of the Lenders, appoint a successor, which shall be one of the Lenders or a
commercial banking institution organized under the laws of the U.S. (or any
State thereof) or a U.S. branch or agency of a commercial banking institution,
and having a combined capital and surplus of at least $500,000,000. Upon the
acceptance of any appointment as Agent or Administrative Agent hereunder by a
successor Agent or Administrative Agent, such successor shall be entitled to
receive from the retiring Agent or Administrative Agent such documents of
transfer and assignment as such successor may reasonably request, and shall
thereupon succeed to and become vested with all rights, powers, privileges and
duties of the retiring Agent or Administrative Agent, as applicable, and the
retiring Agent or Administrative Agent shall be discharged from its duties and
obligations under this Agreement. After any retiring Agent's or Administrative
Agent's resignation hereunder as the Agent or Administrative Agent, the
provisions of
(a) this Article X shall inure to its benefit as to any actions
taken or omitted to be taken by it while it was the Agent or
Administrative Agent under this Agreement; and
(b) Section 11.3 (with respect to expenses incurred prior to
resignation) and Section 11.4 shall continue to inure to its benefit.
SECTION 10.5. Loans or Letters of Credit Issued by Agent, either
Administrative Agent or any Issuer.
(a) The Agent and each Administrative Agent shall have the same
rights and powers with respect to (x) the Loans made by it or any of its
Affiliates, (y) the Notes held by it or any of its Affiliates, and (z) its
participating interests in the Letters of Credit as any other Lender and
may exercise the same as if it were not the Agent. The Agent, each
Administrative Agent and their Affiliates may accept deposits from, lend
money to, and generally engage in any kind of business with the Borrower
or any Subsidiary or Affiliate of the Borrower as if such Person were not
the Agent or Administrative Agent hereunder.
(b) Each Issuer shall have the same rights and powers with respect
to (x) the Loans made by it or any of its Affiliates, (y) the Notes held
by it or any of its Affiliates, and (z) its participating interests in the
Letters of Credit as any other Lender and may exercise the same as if it
were not an Issuer. Each Issuer and its Affiliates may accept deposits
from, lend money to, and generally engage in any kind of business with the
Borrower or any Subsidiary or Affiliate of the Borrower as if it were not
an Issuer hereunder.
SECTION 10.6. Credit Decisions. Each Lender acknowledges that it has,
independently of the Agent, the Administrative Agents and each other Lender,
and based on such Lender's review of the financial information of the Borrower,
this Agreement, the other Loan Documents (the terms and provisions of which
being satisfactory to such Lender) and such other documents,
77
information and investigations as such Lender has deemed appropriate, made its
own credit decision to extend its Commitments. Each Lender also acknowledges
that it will, independently of the Agent, the Administrative Agents and each
other Lender, and based on such other documents, information and investigations
as it shall deem appropriate at any time, continue to make its own credit
decisions as to exercising or not exercising from time to time any rights and
privileges available to it under this Agreement or any other Loan Document.
SECTION 10.7. Copies, etc. The Agent shall give prompt notice to each
Lender of each notice or request required or permitted to be given to the Agent
by the Borrower pursuant to the terms of this Agreement (unless concurrently
delivered to the Lenders by the Borrower). The Agent will distribute to each
Lender each document or instrument received for its account and copies of all
other communications received by the Agent from the Borrower for distribution
to the Lenders by the Agent in accordance with the terms of this Agreement.
SECTION 10.8. Other Agents; Lead Arrangers. None of the Lenders
identified on the facing page or signature pages of this Agreement as a
"bookrunner," or "lead arranger" shall have any right, power, obligation,
liability, responsibility or duty under this Agreement other than those
applicable to all Lenders as such. Without limiting the foregoing, none of the
Lenders so identified shall have or be deemed to have any fiduciary
relationship with any Lender. Each Lender acknowledges that it has not relied,
and will not rely, on any of the Lenders so identified in deciding to enter
into this Agreement or in taking or not taking action hereunder.
ARTICLE XI
MISCELLANEOUS PROVISIONS
SECTION 11.1. Waivers, Amendments, etc. The provisions of this Agreement
and of each other Loan Document may from time to time be amended, modified or
waived, if such amendment, modification or waiver is in writing and consented
to by the Borrower and the Required Lenders; provided, however, that no such
amendment, modification or waiver which would:
(a) modify this Section 11.1 or modify any requirement hereunder that
any particular action be taken by all the Lenders or by the Required
Lenders shall be effective unless consented to by each Lender;
(b) modify any requirement hereunder that any particular action be
taken by the Required Revolving Lenders or change the definition of
"Required Revolving Lenders" shall be effective unless consented to by
each Revolving Lender;
(c) modify any requirement hereunder that any particular action be
taken by the Required Term B Lenders or change the definition of "Required
Term B Lenders" shall be effective unless consented to by each Term B
Lender;
(d) increase the Revolving Commitment Amount of any Revolving Lender
or the Revolving Percentage of any Revolving Lender shall be made without
the consent of such Lender or extend the Revolving Loan Commitment
Termination Date or change any
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provision expressly requiring the consent of all Revolving Lenders shall
be made without the consent of each Revolving Lender;
(e) increase the Term B Loan Commitment Amount of any Term B Lender
or the Term Percentage of any Term B Lender shall be made without the
consent of such Lender or extend the Term B Loan Commitment Termination
Date or change any provision expressly requiring the consent of all Term B
Lenders shall be made without the consent of each Term B Lender;
(f) reduce any fees described in Article III shall be made without
the consent of each Lender affected thereby or extend the due date for, or
reduce the amount of, any scheduled payment of principal, interest or fees
on any Loan (or reduce the principal amount of or rate of interest on any
Loan) shall be made without the consent of the Lender holding the Note
evidencing such Loan;
(g) release the Dedicated Assets subject to the Assignment Agreement
shall be effective without the consent of the Required Lenders unless the
proceeds thereof shall be applied as provided in Section 2.2.2(c) hereof
or release any of the other Dedicated Assets shall be effective without
the consent of all Lenders unless the proceeds of such Dedicated Assets
shall be applied as provided in Section 2.2.2(c) hereof;
(h) modify the application of payments specified under Section 2.2.2
shall be effective without the consent of all Lenders;
(i) release any Guarantor shall be effective without the consent of
all Lenders;
(j) extend the due date for, or reduce the amount of, any
Reimbursement Obligation for a Letter of Credit which has been drawn shall
be made without the consent of the Issuer thereof and each Revolving
Lender;
(k) affect adversely the interests, rights or obligations of an
Issuer qua an Issuer shall be made without the consent of such Issuer;
(l) affect adversely the interests, rights or obligations of the
Agent qua the Agent shall be made without consent of the Agent; or
(m) affect adversely the interests, rights or obligations of the
Administrative Agents qua the Administrative Agents without the consent of
the Administrative Agents.
Notwithstanding the foregoing, (a) prior to completion of the syndication of
the Term B Loans, the Term B Lead Arrangers may exercise their rights under the
Fee Letter and (b) prior to the completion of the syndication of the Revolving
Commitment Amount, the Revolving Lead Arrangers may exercise their rights under
the Fee Letter; provided that in no event may such Persons release any
Dedicated Assets or reduce the fees payable to any Lender or extend the due
date for, or reduce any scheduled payment of principal, interest or fees on any
Loan (or reduce the principal amount of or rate of interest on any Loan)
without the consent of the affected Lender. In addition, Section 10.3 shall not
be amended without the consent of the Agent and the
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Administrative Agents. No failure or delay on the part of the Agent, any Lender
or the holder of any Note in exercising any power or right under this Agreement
or any other Loan Document shall operate as a waiver thereof, nor shall any
single or partial exercise of any such power or right preclude any other or
further exercise thereof or the exercise of any other power or right. No notice
to or demand on the Borrower in any case shall entitle it to any notice or
demand in similar or other circumstances. No waiver or approval by the Agent,
any Lender or the holder of any Note under this Agreement or any other Loan
Document shall, except as may be otherwise stated in such waiver or approval,
be applicable to subsequent transactions. No waiver or approval hereunder shall
require any similar or dissimilar waiver or approval thereafter to be granted
hereunder.
SECTION 11.2. Notices. All notices and other communications provided to
any party hereto under this Agreement or any other Loan Document shall be in
writing or by facsimile and addressed, delivered or transmitted to such party
at its address or facsimile number set forth below its signature hereto or set
forth in the Lender Assignment Agreement or at such other address or facsimile
number as may be designated by such party in a notice to the other parties. Any
notice, if mailed and properly addressed with postage prepaid or if properly
addressed and sent by pre-paid courier service, shall be deemed given when
received; any notice, if transmitted by facsimile, shall be deemed given when
transmitted.
SECTION 11.3. Payment of Costs and Expenses. The Borrower agrees to pay
on demand all reasonable expenses of the Agent and the Administrative Agents
(including the reasonable fees and out-of-pocket expenses of a single counsel
to the Agent and the Administrative Agents, of local counsel, if any, who may
be retained by counsel to the Agent and the Administrative Agents and of
Houlihan, Lokey, Xxxxxx & Xxxxx) in connection with
(a) the negotiation, preparation, execution, delivery or
administration of this Agreement and of each other Loan Document,
including schedules and exhibits, and any amendments, waivers, consents,
supplements or other modifications to this Agreement or any other Loan
Document as may from time to time hereafter be required, whether or not
the transactions contemplated hereby are consummated,
(b) the filing, recording, refiling or rerecording of any Uniform
Commercial Code financing statements relating to the Assignment Agreement
and all amendments, supplements and modifications to any thereof and any
and all other documents or instruments of further assurance required to be
filed or recorded or refiled or rerecorded by the terms hereof or of the
Assignment Agreement, and
(c) the preparation and review of the form of any document or
instrument relevant to this Agreement or any other Loan Document.
If the Agent, either Administrative Agent or their counsel shall be
precluded from undertaking the duties described in clause (b) above due to a
conflict of interest, the Lenders may appoint another Lender and/or counsel to
discharge such duties and the Borrower shall be responsible for the reasonable
expenses of such Lender and counsel. The Borrower further agrees to pay, and to
save the Agent, the Administrative Agents, each Issuer and the Lenders harmless
from all liability for, any stamp or other taxes (other than income taxes)
which may be
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payable in connection with the execution or delivery of this Agreement, the
borrowings hereunder, the issuance of the Notes, the issuance of the Letters of
Credit, or any other Loan Documents. The Borrower also agrees to reimburse the
Agent and the Administrative Agents, each Issuer and each Lender upon demand
for all reasonable out-of-pocket expenses (including attorneys' fees and legal
expenses) incurred by the Agent or such Lender in connection with (x) the
negotiation of any restructuring or "work-out", whether or not consummated, of
any Obligations and (y) the enforcement of any Obligations upon and during the
continuing of an Event of Default.
SECTION 11.4. Indemnification. In consideration of the execution and
delivery of this Agreement by each Lender and the extension of the Commitments,
the Borrower hereby indemnifies, exonerates and holds the Agent, each Arranger,
the Administrative Agents, the Issuers and each Lender and each of their
respective officers, directors, employees and agents, and each other person
controlling any of the foregoing within the meaning of either Section 15 of the
Securities Act of 1933, as amended, or Section 20 of the Securities Exchange
Act of 1934, as amended (collectively, the "Indemnified Parties") free and
harmless from and against any and all actions, causes of action, suits, losses,
costs, liabilities and damages, and expenses incurred by any Indemnified Party
in connection therewith (irrespective of whether any such Indemnified Party is
a party to the action for which indemnification hereunder is sought), including
reasonable attorneys' fees and disbursements (collectively, the "Indemnified
Liabilities"), incurred by the Indemnified Parties or any of them as a result
of, or arising out of, or relating to
(a) any transaction financed or to be financed in whole or in part,
directly or indirectly, with the proceeds of any Loan or the use of any
Letter of Credit;
(b) the entering into and performance of this Agreement and any other
Loan Document by any of the Indemnified Parties (including any action
brought by or on behalf of the Borrower as the result of the Required
Lenders' refusal to make any Credit Extension as a result of the
Borrower's failure to satisfy the conditions in Article VI hereof but not
including any breach of this Agreement or any other Loan Document by the
Agent or any of the Lenders);
(c) any investigation, litigation or proceeding related to any
acquisition or proposed acquisition by the Borrower or any of its
Subsidiaries of all or any portion of the stock or assets of any Person,
whether or not the Agent or such Lender is party thereto;
(d) any investigation, litigation or proceeding related to any
environmental cleanup, audit, compliance or other matter relating to the
protection of the environment or the Release by the Borrower or any of its
Subsidiaries of any Hazardous Material; or
(e) the presence on or under, or the escape, seepage, leakage,
spillage, discharge, emission, discharging or releases from, any real
property owned or operated by the Borrower or any Subsidiary thereof of
any Hazardous Material (including any losses, liabilities, damages,
injuries, costs, expenses or claims asserted or arising under any
Environmental Law), regardless of whether caused by, or within the control
of, the Borrower or such Subsidiary,
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except for any such Indemnified Liabilities resulting from, arising out of or
relating to the relevant Indemnified Party's gross negligence or willful
misconduct. If and to the extent that the foregoing undertaking may be
unenforceable for any reason, the Borrower hereby agrees to make the maximum
contribution to the payment and satisfaction of each of the Indemnified
Liabilities which is permissible under applicable law. In addition to the
foregoing, the Borrower hereby waives any and all rights to seek or obtain
consequential damages from any Indemnified Party.
The Lenders agree to indemnify each Issuer with respect to any acts taken
or omissions suffered by the Issuer in connection with each Letter of Credit
issued by it or proposed to be issued by it and the related Issuance Request
(to the extent not reimbursed by the Borrower), ratably according to their
respective Aggregate Percentages, from and against any and all claims, damages,
losses, liabilities and expenses (including without limitation, reasonable fees
and disbursements of counsel) of any kind or nature whatsoever which may be
imposed on, incurred by, or asserted against any Issuer in any way relating to
or arising out of any of the Loan Documents or the Letters of Credit or any
action taken or omitted by such Issuer under the Loan Documents or the Letters
of Credit (EXPRESSLY INCLUDING ANY SUCH CLAIM, DAMAGE, LOSS, LIABILITY OR
EXPENSE ATTRIBUTABLE TO THE ORDINARY, SOLE OR CONTRIBUTORY NEGLIGENCE OF THE
ISSUER, BUT EXCLUDING ANY SUCH CLAIM, DAMAGE, LOSS, LIABILITY OR EXPENSE
ATTRIBUTABLE TO THE GROSS NEGLIGENCE OR WILLFUL MISCONDUCT OF THE ISSUER). IT
IS THE INTENT OF THE PARTIES HERETO THAT THE ISSUER SHALL, TO THE EXTENT
PROVIDED IN THIS SECTION 11.4, BE INDEMNIFIED FOR ITS OWN ORDINARY, SOLE OR
CONTRIBUTORY NEGLIGENCE. Without limitation of the foregoing, each Lender
agrees to reimburse each Issuer promptly upon demand for such Lender's ratable
share of any reasonable out-of-pocket expenses (including reasonable counsel
fees) incurred by such Issuer 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 or the Letters
of Credit, or any of them, to the extent that the Issuer is not reimbursed for
such expenses by the Borrower.
SECTION 11.5. Survival. The obligations of the Borrower under Sections
5.3, 5.4, 5.5, 5.6, 11.3 and 11.4, and the obligations of the Lenders under
Section 10.1, shall in each case survive any termination of this Agreement, the
payment in full of all Obligations and the termination of all Commitments. The
representations and warranties made by each Obligor in this Agreement and in
each other Loan Document shall survive the execution and delivery of this
Agreement and each such other Loan Document.
SECTION 11.6. Severability. Any provision of this Agreement or any other
Loan Document which is prohibited or unenforceable in any jurisdiction shall,
as to such provision and such jurisdiction, be ineffective to the extent of
such prohibition or unenforceability without invalidating the remaining
provisions of this Agreement or such Loan Document or affecting the validity or
enforceability of such provision in any other jurisdiction.
SECTION 11.7. Headings. The various headings of this Agreement and of
each other Loan Document are inserted for convenience only and shall not affect
the meaning or interpretation of this Agreement or such other Loan Document or
any provisions hereof or thereof.
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SECTION 11.8. Execution in Counterparts, Effectiveness, etc. This
Agreement may be executed by the parties hereto in several counterparts, each
of which shall be executed by the Borrower and the Agent and be deemed to be an
original and all of which shall constitute together but one and the same
agreement. This Agreement shall become effective when counterparts hereof
executed on behalf of the Borrower and each Lender (or notice thereof
satisfactory to the Agent) shall have been received by the Agent.
SECTION 11.9. Governing Law; Entire Agreement. THIS AGREEMENT, THE NOTES
AND EACH OTHER LOAN DOCUMENT SHALL EACH BE DEEMED TO BE A CONTRACT MADE UNDER
AND GOVERNED BY AND CONSTRUED IN ACCORDANCE WITH THE INTERNAL LAWS OF THE STATE
OF NEW YORK. This Agreement, the Notes and the other Loan Documents constitute
the entire understanding among the parties hereto with respect to the subject
matter hereof and supersede any prior agreements, written or oral, with respect
thereto.
SECTION 11.10. Successors and Assigns. This Agreement shall be binding
upon and shall inure to the benefit of the parties hereto and their respective
successors and assigns; provided, however, that:
(a) the Borrower may not assign or transfer its rights or obligations
hereunder without the prior written consent of the Agent and all Lenders;
and
(b) the rights of sale, assignment and transfer of the Lenders are
subject to Section 11.11.
SECTION 11.11. Sale and Transfer of Loans and Notes; Participations in
Loans and Notes. Each Lender may assign, or sell participations in, its Loans
and Commitments to one or more other Persons in accordance with this Section
11.11.
SECTION 11.11.1. Assignments. Any Lender,
(a) with the written consents of the Borrower, the Agent and each
Issuer (which consents shall not be unreasonably withheld and which
consents shall be deemed to have been given in the absence of a written
notice delivered by the Borrower, the Agent or such Issuer to the Agent,
on or before the fifth Business Day after receipt by such Person of such
Lender's request for consent, stating, in reasonable detail, the reasons
why such Person proposes to withhold such consent and which consent shall
not be required from the Borrower after the occurrence and during the
continuance of an Event of Default or during the primary syndication of
the Revolving Loan Commitment) may at any time assign and delegate to one
or more commercial banks or other financial institutions its Revolving
Loans and Revolving Loan Commitments, and
(b) with notice to the Borrower, the Agent and the Issuers may
assign and delegate any of its Loans to any of its Affiliates or to any
other Lender, and
(c) with notice to the Borrower and the Agent may assign and
delegate its Term Loans to any other Person.
83
(each Person described in either of the foregoing clauses as being the Person
to whom such assignment and delegation is to be made, being hereinafter
referred to as an "Assignee Lender"), all or a fraction of such Lender's total
Loans, Commitments or other interests of such Lender hereunder (which
assignment and delegation shall be of a constant, and not a varying, percentage
of all the assigning Lender's Loans, Commitments and other interests) in a
minimum aggregate amount of $5,000,000 in the case of Revolving Loan
Commitments or $1,000,000 in the case of Term B Loans or, if less, the amount
of such Lender's Commitment; provided, however, that any such Assignee Lender
will comply, if applicable, with the provisions contained in Section 5.6 and
further, provided, however, that, the Borrower, each other Obligor and the
Agent shall be entitled to continue to deal solely and directly with such
Lender in connection with the interests so assigned and delegated to an
Assignee Lender until
(i) written notice of such assignment and delegation,
together with payment instructions, addresses and related information
with respect to such Assignee Lender, shall have been given to the
Borrower and the Agent by such Lender and such Assignee Lender,
(ii) such Assignee Lender shall have executed and delivered to
the Borrower and the Agent a Lender Assignment Agreement, and to the
extent and on the terms required herein, such agreement shall have
been accepted by the Agent and the Borrower, and
(iii) the processing fees described below shall have been paid.
From and after the date that the Agent accepts such Lender Assignment
Agreement, (x) the Assignee Lender thereunder shall be deemed automatically to
have become a party hereto and to the extent that rights and obligations
hereunder have been assigned and delegated to such Assignee Lender in
connection with such Lender Assignment Agreement, shall have the rights and
obligations of a Lender hereunder and under the other Loan Documents, and (y)
the assignor Lender, to the extent that rights and obligations hereunder have
been assigned and delegated by it in connection with such Lender Assignment
Agreement, shall be released from its obligations hereunder and under the other
Loan Documents with respect to obligations arising after the date of
assignment. Within five Business Days after its receipt of notice that the
Agent has received an executed Lender Assignment Agreement, the Borrower shall
execute and deliver to the Agent (for delivery to the relevant Assignee Lender)
new Notes evidencing such Assignee Lender's assigned Loans and Commitments and,
if the assignor Lender has retained Loans and Commitments hereunder,
replacement Notes in the principal amount of the Loans and Commitments retained
by the assignor Lender hereunder (such Notes to be in exchange for, but not in
payment of, those Notes then held by such assignor Lender). Each such Note
shall be dated the date of the predecessor Notes. The assignor Lender shall
xxxx the predecessor Notes "exchanged" and deliver them to the Borrower.
Accrued interest on that part of the predecessor Notes evidenced by the new
Notes, and accrued fees, shall be paid as provided in the Lender Assignment
Agreement. Accrued interest on that part of the predecessor Notes evidenced by
the replacement Notes shall be paid to the assignor Lender. Accrued interest
and accrued fees shall be paid at the same time or times provided in the
predecessor Notes and in this Agreement. Such assignor Lender or such Assignee
Lender must also pay a processing fee to the Agent upon delivery of any Lender
Assignment Agreement in the amount of $3,000; provided, however that
84
such processing fee shall not be charged in the case of assignments by the
Administrative Agents. Any attempted assignment and delegation not made in
accordance with this Section 11.11.1 shall be null and void. In addition to the
foregoing, and notwithstanding any other provision hereof, (i) any Lender may
at any time without notice to or consent by any other Person assign its rights
under this Agreement to any Federal Reserve Bank and (ii) the Agent shall
provide notice to the Lenders of any assignments by it under this Section
11.11.1.
SECTION 11.11.2. Participations. Any Lender may at any time sell to one
or more commercial banks or other Persons (each of such commercial banks and
other Persons being herein called a "Participant") participating interests (or
a sub-participating interest, in the case of a Lender's participating interest
in a Letter of Credit) in any of the Loans, Commitments, or other interests of
such Lender hereunder; provided, however, that
(a) no participation or sub-participation contemplated in this
Section 11.11 shall relieve such Lender from its Commitments or its other
obligations hereunder or under any other Loan Document,
(b) such Lender shall remain solely responsible for the performance
of its Commitments and such other obligations,
(c) the Borrower and each other Obligor and the Agent shall continue
to deal solely and directly with such Lender in connection with such
Lender's rights and obligations under this Agreement and each of the other
Loan Documents,
(d) no Participant, unless such Participant is an Affiliate of such
Lender, or is itself a Lender, shall be entitled to require such Lender to
take or refrain from taking any action hereunder or under any other Loan
Document, except that such Lender may agree with any Participant that such
Lender will not, without such Participant's consent, take any actions of
the type described in clause (b) or (c) of Section 11.1, and
(e) the Borrower shall not be required to pay any amount under
Section 5.6 that is greater than the amount which it would have been
required to pay had no participating interest been sold.
The Borrower acknowledges and agrees that each Participant, for purposes of
Sections 5.3, 5.4, 5.5, 5.6, 5.8, 5.9, 11.3 and 11.4, shall be considered a
Lender.
SECTION 11.11.3. Special Funding Vehicles. Notwithstanding anything to
the contrary contained herein, any Lender (a "Granting Lender") may grant to a
special purpose funding vehicle (a "SPC"), identified as such in writing from
time to time by the Granting Lender to the Agent and the Borrower, the option
to provide to the Borrower all or any part of any Loan that such Granting
Lender is obligated to make to the Borrower pursuant to this Agreement;
provided that (i) nothing herein shall constitute a commitment by any SPC to
make any Loan, (ii) if an SPC elects not to exercise such option or otherwise
fails to provide all or any part of such Loan, the Granting Lender shall remain
obligated to make such Loan pursuant to the terms hereof, (iii) the Borrower
shall not be required to pay any amount under Section 5.6 that is greater than
the amount which it would have been required to pay had there been no grant to
an SPC and any SPC (or assignee of an SPC) will comply, if applicable, with the
provisions contained in
85
Section 5.6. No grant by any Granting Lender to an SPC agreeing to provide a
Loan or making of such Loan by any SPC shall operate to relieve such Granting
Lender of its liabilities and obligations hereunder, except to the extent of
the making of such Loan by such SPC. The making of a Loan by an SPC hereunder
shall utilize the Commitment of the Granting Lender to the same extent, and as
if, such Loan were made by such Granting Lender. Each party hereto hereby
agrees that no SPC shall be liable for any indemnity or similar payment
obligation under this Agreement (all liability for which shall remain with the
Granting Lender). In addition, each party hereto hereby agrees (which agreement
shall survive the termination of this Agreement) that, any SPC may (i) with
notice to, but without the prior written consent of, the Borrower and the Agent
and without paying any processing fee therefore, assign all or a portion of its
interests in any Loans to the Granting Lender or to any financial institutions
(consented to by the Borrower and Agent, each in its sole discretion) providing
liquidity and/or credit support to or for the account of such SPC to support
the funding or maintenance of Loans and (ii) disclose on a confidential basis
any non-public information relating to its Loans to any rating agency,
commercial paper dealer or provider of any surety, guarantee or credit or
liquidity enhancement to such SPC. This Section may not be amended without the
written consent of any SPC that holds an option to provide Loans. No recourse
under any obligation, covenant, or agreement of the SPC contained in this
Agreement shall be had against any shareholder, officer, agent or director of
the SPC as such, by the enforcement of any assessment or by any proceeding, by
virtue of any statute or otherwise; it being expressly agreed and understood
that this Agreement is a corporate obligation of the SPC and no personal
liability shall attach to or be incurred by any officer, agents or member of
the SPC as such, or any of them under or by reason of any of the obligations,
covenants or agreements of the SPC contained in this Agreement, or implied
therefrom, and that any and all personal liability for breaches by the SPC of
any such obligations, covenants or agreements, either at law or by statute or
constitution, of every such shareholder, officer, agent or director is hereby
expressly waived by all parties to this Agreement as a condition of and
consideration for the SPC entering into this Agreement; provided, however, that
the foregoing shall not relieve any such person or entity of any liability they
might otherwise have as a result of fraudulent actions or omissions taken by
them. All parties to this Agreement acknowledge and agree that the SPC shall
only be liable for any claims that each of them may have against the SPC only
to the extent of the SPC's assets. The provisions of this clause shall survive
the termination of this Agreement.
SECTION 11.12. Other Transactions. Nothing contained herein shall
preclude the Agent or any other Lender from engaging in any transaction, in
addition to those contemplated by this Agreement or any other Loan Document,
with the Borrower or any of its Affiliates in which the Borrower or such
Affiliate is not restricted hereby from engaging with any other Person.
SECTION 11.13. Forum Selection and Consent to Jurisdiction. ANY
LITIGATION BASED HEREON, OR ARISING OUT OF, UNDER, OR IN CONNECTION WITH, THIS
AGREEMENT OR ANY OTHER LOAN DOCUMENT, OR ANY COURSE OF CONDUCT, COURSE OF
DEALING, STATEMENTS (WHETHER VERBAL OR WRITTEN) OR ACTIONS OF THE AGENT, THE
LENDERS OR THE BORROWER SHALL BE BROUGHT AND MAINTAINED EXCLUSIVELY IN THE
COURTS OF THE STATE OF NEW YORK OR IN THE UNITED STATES DISTRICT COURT FOR THE
SOUTHERN DISTRICT OF NEW YORK; PROVIDED, HOWEVER, THAT ANY
86
SUIT SEEKING ENFORCEMENT AGAINST ANY COLLATERAL OR OTHER PROPERTY MAY BE
BROUGHT, AT THE AGENT'S OPTION, IN THE COURTS OF ANY JURISDICTION WHERE SUCH
COLLATERAL OR OTHER PROPERTY MAY BE FOUND. THE BORROWER HEREBY EXPRESSLY AND
IRREVOCABLY SUBMITS TO THE JURISDICTION OF THE COURTS OF THE STATE OF NEW YORK
AND OF THE UNITED STATES DISTRICT COURT FOR THE SOUTHERN DISTRICT OF NEW YORK
FOR THE PURPOSE OF ANY SUCH LITIGATION AS SET FORTH ABOVE AND IRREVOCABLY
AGREES TO BE BOUND BY ANY JUDGMENT RENDERED THEREBY IN CONNECTION WITH SUCH
LITIGATION. THE BORROWER FURTHER IRREVOCABLY CONSENTS TO THE SERVICE OF PROCESS
BY PERSONAL SERVICE WITHIN OR WITHOUT THE STATE OF NEW YORK OR IN ANY MANNER
PROVIDED BY LAW. THE BORROWER HEREBY EXPRESSLY AND IRREVOCABLY WAIVES, TO THE
FULLEST EXTENT PERMITTED BY LAW, ANY OBJECTION WHICH IT MAY HAVE OR HEREAFTER
MAY HAVE TO THE LAYING OF VENUE OF ANY SUCH LITIGATION BROUGHT IN ANY SUCH
COURT REFERRED TO ABOVE AND ANY CLAIM THAT ANY SUCH LITIGATION HAS BEEN BROUGHT
IN AN INCONVENIENT FORUM. TO THE EXTENT THAT THE BORROWER HAS OR HEREAFTER MAY
ACQUIRE ANY IMMUNITY FROM JURISDICTION OF ANY COURT OR FROM ANY LEGAL PROCESS
(WHETHER THROUGH SERVICE OR NOTICE, ATTACHMENT PRIOR TO JUDGMENT, ATTACHMENT IN
AID OF EXECUTION OR OTHERWISE) WITH RESPECT TO ITSELF OR ITS PROPERTY, THE
BORROWER HEREBY IRREVOCABLY WAIVES SUCH IMMUNITY IN RESPECT OF ITS OBLIGATIONS
UNDER THIS AGREEMENT AND THE OTHER LOAN DOCUMENTS.
SECTION 11.14. Waiver of Jury Trial. THE AGENT, THE LENDERS AND THE
BORROWER HEREBY KNOWINGLY, VOLUNTARILY AND INTENTIONALLY WAIVE ANY RIGHTS THEY
MAY HAVE TO A TRIAL BY JURY IN RESPECT OF ANY LITIGATION AMONG ANY OF THE
AGENT, THE LENDERS AND THE BORROWER BASED HEREON, OR ARISING OUT OF, UNDER, OR
IN CONNECTION WITH, THIS AGREEMENT OR ANY OTHER LOAN DOCUMENT, OR ANY COURSE OF
CONDUCT, COURSE OF DEALING, STATEMENTS (WHETHER VERBAL OR WRITTEN) OR ACTIONS
OF THE AGENT, THE LENDERS OR THE BORROWER. THE BORROWER ACKNOWLEDGES AND AGREES
THAT IT HAS RECEIVED FULL AND SUFFICIENT CONSIDERATION FOR THIS PROVISION (AND
EACH OTHER PROVISION OF EACH OTHER LOAN DOCUMENT TO WHICH IT IS A PARTY) AND
THAT THIS PROVISION IS A MATERIAL INDUCEMENT FOR THE AGENT AND THE LENDERS
ENTERING INTO THIS AGREEMENT AND EACH SUCH OTHER LOAN DOCUMENT.
SECTION 11.15. Confidentiality. The Lenders shall hold all non-public
information (which has been identified as such by the Borrower) obtained
pursuant to the requirements of this Agreement in accordance with their
customary procedures for handling confidential information of this nature and
in accordance with safe and sound banking practices and in any event may make
disclosure to any of their examiners, their Affiliates, outside auditors,
counsel and other professional advisors in connection with this Agreement or as
reasonably required by
87
any bona fide transferee, participant or assignee or as required or requested
by any governmental agency or representative thereof or pursuant to legal
process; provided, however, that
(a) unless specifically prohibited by applicable law or court order,
each Lender shall notify the Borrower of any request by any governmental
agency or representative thereof (other than any such request in
connection with an examination of the financial condition of such Lender
by such governmental agency) for disclosure of any such non-public
information prior to disclosure of such information;
(b) prior to any such disclosure pursuant to this Section 11.15,
each Lender shall require any such bona fide transferee, participant and
assignee receiving a disclosure of non-public information to agree in
writing
(i) to be bound by this Section 11.15;
(ii) to require such Person to require any other Person to
whom such Person discloses such non-public information to be
similarly bound by this Section 11.15; and
(c) except as may be required by an order of a court of competent
jurisdiction and to the extent set forth therein, no Lender shall be
obligated or required to return any materials furnished by the Borrower or
any Subsidiary.
SECTION 11.16. Judgment Currency. The Obligations of the Borrower and
any other Obligor in respect of any sum due to any Lender or the Agent
hereunder, under the Notes or under or in respect of any other Loan Document
shall, notwithstanding any judgment in a currency (the "Judgment Currency")
other than the currency in which such sum was originally denominated (the
"Original Currency"), be discharged only to the extent that on the Business Day
following receipt by such Lender or the Agent of any sum adjudged to be so due
in the Judgment Currency, such Lender or the Agent, in accordance with normal
banking procedures, purchases the Original Currency with the Judgment Currency.
If the amount of Original Currency so purchased is less than the sum originally
due to such Lender or the Agent, the Borrower agrees as a separate obligation
and notwithstanding any such judgment, to indemnify each Lender and the Agent,
as the case may be, against such loss, and if the amount of Original Currency
so purchased exceeds the sum originally due to such Lender and the Agent, as
the case may be, each Lender and the Agent agree to remit any excess to the
applicable Obligor. If, for the purpose of obtaining judgment in any court, it
is necessary to convert a sum due under any Loan Document in another currency
into Dollars, Canadian Dollars or Sterling, as the case may be, the parties
hereto agree, to the fullest extent that they may effectively do so, that the
rate of exchange used shall be that at which, in accordance with normal banking
procedures, the applicable Lender could purchase such other currency with
Dollars, Canadian Dollars or Sterling, as the case may be, in New York, at the
close of business on the Business Day immediately preceding the day on which
final judgment is given, together with any premiums and costs of exchange
payable in connection with such purchase.
88
IN WITNESS WHEREOF, the parties hereto have caused this Agreement to be
executed by their respective officers thereunto duly authorized as of the day
and year first above written.
CALPINE CORPORATION
By:______________________________________________
Name: Xxxxxxx Xxxxxx
Title: Senior Vice President - Finance
Address: 00 Xxxx Xxx Xxxxxxxx Xxxxxx
Xxx Xxxx, XX 00000
Facsimile No.: (000) 000-0000
Attention: Senior Vice President-Finance
THE BANK OF NOVA SCOTIA,
as Agent and Administrative Agent
By:______________________________________________
Name:
Title:
Address: 000 Xxxxxxxxxx Xxxxxx
Xxxxx 0000
Xxx Xxxxxxxxx, XX 00000
Facsimile No.: (000) 000-0000
Attention: Xxx Xxxxxxx
with a copy to:
The Bank of Nova Scotia
000 Xxxxxxxxx Xxxxxx X.X.
Xxxxx 0000
Xxxxxxx, XX 00000
Attention: Xxxxx Xxxxxxxx
Administrative Agent -
Loan Administration
Facsimile No.: (000) 000-0000
CITICORP USA, INC.,
as Administrative Agent
By:______________________________________________
Name:
Title:
Address: 000 Xxxxxxxxx Xxxxxx
Xxx Xxxx, XX 00000
Facsimile No.: (000) 000-0000
Attention: Xxxx Xxxxxxx
LENDERS
THE BANK OF NOVA SCOTIA
By:______________________________________________
Name:
Title:
Address: 000 Xxxxxxxxxx Xxxxxx
Xxxxx 0000
Xxx Xxxxxxxxx, XX 00000
Facsimile No.: (000) 000-0000
Attention: Xxx Xxxxxxx
with a copy to:
The Bank of Nova Scotia
000 Xxxxxxxxx Xxxxxx X.X.
Xxxxx 0000
Xxxxxxx, XX 00000
Attention: Xxxxx Xxxxxxxx
Administrative Agent -
Loan Administration
Facsimile No.: (000) 000-0000
CITICORP USA, INC.
By:______________________________________________
Name:
Title:
Address: 000 Xxxxxxxxx Xxxxxx
Xxx Xxxx, XX 00000
Facsimile No.: (000) 000-0000
Attention: Xxxxxx X. Xxxxxxx
BAYERISCHE LANDESBANK GIROZENTRALE
By:______________________________________________
Name:
Title:
By:______________________________________________
Name:
Title:
Address: 000 Xxxxxxxxx Xxxxxx
Xxx Xxxx, XX 00000
Facsimile No.: (000) 000-0000
Attention: Xxxxxxxxxxx Xxxxxxxxx
with a copy to:
Bayerische Landesbank Girozentrale
000 Xxxxxxxxx Xxxxxx
Xxx Xxxx, XX 00000
Facsimile No.: (000) 000-0000
Attention: Xxxxxxxx Xxxxxxx
Loan Administration
BANK OF AMERICA, NATIONAL ASSOCIATION
By:______________________________________________
Name:
Title:
Address: CA5-705-12-10
000 Xxxxxxxxxx Xxxxxx, 00xx Xxxxx
Xxx Xxxxxxxxx, XX 00000
Facsimile No.: (000) 000-0000
Attention: Xxxxxxx Xxxxx
with a copy to:
Bank of America Plaza
TX1-492-14-05
000 Xxxx Xxxxxx
Xxxxxx, Xxxxx 00000
Attention: Xxxxx Xxxxxxx
Facsimile No. (000) 000-0000
CREDIT SUISSE FIRST BOSTON, CAYMAN ISLANDS BRANCH
By:______________________________________________
Name:
Title:
By:______________________________________________
Name:
Title:
Address: Eleven Xxxxxxx Xxxxxx
Xxx Xxxx, Xxx Xxxx 00000
Facsimile No.: (000) 000-0000
Attention: Loan Department
TORONTO DOMINION (TEXAS) INC.
By:______________________________________________
Name:
Title:
Address: 000 Xxxxxx Xxxxxx
00xx Xxxxx
Xxxxxxx, Xxxxx 00000
Facsimile No.: (000) 000-0000
Attention: Xxxx X. Xxxxx
BANKERS TRUST COMPANY
By:______________________________________________
Name:
Title:
Address: __________________________________
__________________________________
__________________________________
Facsimile No.: __________________________________
Attention: ______________________________________
ING (U.S.) CAPITAL LLC
By:______________________________________________
Name:
Title:
By:______________________________________________
Name:
Title:
Address: 0000 Xxxxxx xx xxx Xxxxxxxx
Xxx Xxxx, XX 00000
Facsimile No.: (000) 000-0000 or (000) 000-0000
Attention: Xxxxxxx Xxxxx (000) 000-0000
SCHEDULE I
DISCLOSURE SCHEDULE*
ITEM 6.1.10 Prospects.
ITEM 7.7 Litigation.
Description of Proceeding Action or Claim Sought
ITEM 7.8 Existing Significant Subsidiaries.
State of Ownership Business
Name Incorporation % Description
ITEM 7.11 Employee Benefit Plans.
ITEM 7.12 Environmental Matters.
ITEM 7.15 Indebtedness.
ITEM 8.2.2(a) Ongoing Indebtedness.
Creditor Outstanding Principal Amount
____________________________
* Item numbers are keyed to refer to Sections where the item is principally
referred to and will have to be revised as such Sections are renumbered.
SCHEDULE II
PERCENTAGES
Revolving Revolving Term B Term B Aggregate
Lender Commitment Percentage Commitment Percentage Percentage
------ ---------- ---------- ---------- ---------- ----------
The Bank of Nova Scotia $143,333,333 14.333% 0 0 8.958%
Citicorp USA, Inc. $143,333,333 14.333% $200,000,000 33.333% 21.458%
Bayerische Landesbank $143,333,333 14.333% 0 0 8.958%
Girozentrale
Bankers Trust Company $143,333,333 14.333% $200,000,000 33.333% 21.458%
Credit Suisse First Boston, $143,333,333 14.333% $200,000,000 33.333% 21.458%
Cayman Islands Branch
Bank of America, National $143,333,333 14.333% 0 0 8.958%
Association
Toronto Dominion (Texas) $100,000,000 10% 0 0 6.250%
Inc.
ING (U.S.) Capital LLC $40,000,000 4% 0 0 2.500%
1
SCHEDULE 4.10
EXISTING LETTERS OF CREDIT
POUND STERLING LCS AND BANK GUARANTEES FOR THE SALTEND COGENERATION PROJECT
BAYERISCHE LANDESBANK AS ISSUER
BVL L/C # Beneficiary [pound] Amount Expiry Date
--------- ----------- -------------- -----------
BPG0801-001 BP Gas Marketing Limited Standby LC [pound]35,000,000 August 22, 2002
N/A National Grid Company Bank Performance [pound] 7,142,000 March 31, 2002
Guarantee
BPG0801-003 Elexon Clear Limited Standby LC [pound] 6,120,000 August 22, 2002
TBD National Grid Company Standby LC [pound] 758,131 August 22, 2002
Saltend Subtotals: [pound]49,020,131
1
EXHIBIT A-1
REVOLVING NOTE
$____________ March 8, 2002
FOR VALUE RECEIVED, the undersigned, CALPINE CORPORATION, a Delaware
corporation (the "Borrower"), promises to pay to the order of
____________________ (the "Lender") on the Revolving Loan Commitment
Termination Date, the principal sum of _________________ DOLLARS ($________)
or, if less, the aggregate unpaid principal amount of all Revolving Loans made
by the Lender pursuant to that certain Credit Agreement, dated as of March 8,
2002 (together with all amendments and other modifications, if any, from time
to time thereafter made thereto, the "Credit Agreement"), among the Borrower,
THE BANK OF NOVA SCOTIA, as Agent, and the various financial institutions
(including the Lender) as are, or may from time to time become, parties
thereto. This Note also evidences the obligation of the Borrower to reimburse
each Lender for such Lender's Revolving Percentage of all outstanding L/C
Advances under the Credit Agreement.
The Borrower also promises to pay interest on the unpaid principal amount
hereof from time to time outstanding from the date hereof until maturity
(whether by acceleration or otherwise) and, after maturity, until paid, at the
rates per annum and on the dates specified in the Credit Agreement.
Payments of both principal and interest are to be made in lawful money of
the United States of America in same day or immediately available funds to the
account designated by the Agent pursuant to the Credit Agreement.
This Note is one of the Revolving Notes referred to in, and evidences
Indebtedness incurred under, the Credit Agreement, to which reference is made
for a description of the security for this Note and for a statement of the
terms and conditions on which the Borrower is permitted and required to make
prepayments and repayments of principal of the Indebtedness evidenced by this
Note and on which such Indebtedness may be declared to be immediately due and
payable. Unless otherwise defined, terms used herein have the meanings provided
in the Credit Agreement.
All parties hereto, whether as makers, endorsers, or otherwise, severally
waive presentment for payment, demand, protest and notice of dishonor.
A-1-1
THIS NOTE SHALL BE DEEMED TO BE MADE UNDER AND GOVERNED BY AND CONSTRUED
IN ACCORDANCE WITH THE INTERNAL LAWS OF THE STATE OF NEW YORK.
CALPINE CORPORATION
By______________________________________________
Name:
Title:
A-1-2
LOANS AND PRINCIPAL PAYMENTS
==========================================================================================================================
Amount of Revolving Interest Amount of Principal Unpaid Principal
Loan Made Period Repaid Balance Notation
Date (If Applicable) Total Made By
---- ------------------- --------------- ------------------- ---------------- ----- --------
==========================================================================================================================
Base LIBO Base LIBO Base LIBO
Rate Rate Rate Rate Rate Rate
---- ---- ---- ---- ---- ----
--------------------------------------------------------------------------------------------------------------------------
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X-0-0
XXXXXXX X-0
XXXX NOTE
$[______________________] _________, 2002
FOR VALUE RECEIVED, the undersigned, CALPINE CORPORATION, a Delaware
corporation (the "Borrower"), promises to pay to the order of [ ] (the
"Lender") on the Term Loan B Commitment Termination Date, the principal sum of
[ ($ )] or, if less, the aggregate unpaid principal amount of all Loans made by
the Lender pursuant to that certain Credit Agreement, dated as of March 8, 2002
(together with all amendments and other modifications, if any, from time to
time thereafter made thereto, the "Credit Agreement"), among the Borrower, THE
BANK OF NOVA SCOTIA, as Agent, and the various financial institutions
(including the Lender) as are, or may from time to time become, parties thereto.
The Borrower also promises to pay interest on the unpaid principal amount
hereof from time to time outstanding from the date hereof until maturity
(whether by acceleration or otherwise) and, after maturity, until paid, at the
rates per annum and on the dates specified in the Credit Agreement.
Payments of both principal and interest are to be made in lawful money of
the United States of America in same day or immediately available funds to the
account designated by the Agent pursuant to the Credit Agreement.
This Term Note is one of the Term Notes referred to in, and evidences
Indebtedness incurred under, the Credit Agreement, to which reference is made
for a description of the security for this Term Note and for a statement of the
terms and conditions on which the Borrower is permitted and required to make
prepayments and repayments of principal of the Indebtedness evidenced by this
Term Note and on which such Indebtedness may be declared to be immediately due
and payable. Unless otherwise defined, terms used herein have the meanings
provided in the Credit Agreement.
All parties hereto, whether as makers, endorsers, or otherwise, severally
waive presentment for payment, demand, protest and notice of dishonor.
A-2-1
THIS TERM NOTE SHALL BE DEEMED TO BE MADE UNDER AND GOVERNED BY AND
CONSTRUED IN ACCORDANCE WITH THE INTERNAL LAWS OF THE STATE OF NEW YORK.
CALPINE CORPORATION
By:______________________________________________
Name:____________________________________________
Title:___________________________________________
A-2-2
TERM LOANS AND PRINCIPAL PAYMENTS
=========== ===================== ============== ====================== ====================== ========= ==============
Interest
Amount of Term Period (If Amount of Unpaid Principal Notation
Date Loan Made Applicable) Principal Repaid Balance Total Made By
---- --------- ----------- ---------------- ------- ----- -------
=======================================================================================================================
Base LIBO Base LIBO Base LIBO
Rate Rate Rate Rate Rate Rate
---- ---- ---- ---- ---- ----
----------- -------- -- --------- -------------- -------- ---- -------- --------- --- -------- --------- --------------
----------- -------- -- --------- -------------- -------- ---- -------- --------- --- -------- --------- --------------
----------- -------- -- --------- -------------- -------- ---- -------- --------- --- -------- --------- --------------
----------- -------- -- --------- -------------- -------- ---- -------- --------- --- -------- --------- --------------
----------- -------- -- --------- -------------- -------- ---- -------- --------- --- -------- --------- --------------
----------- -------- -- --------- -------------- -------- ---- -------- --------- --- -------- --------- --------------
----------- -------- -- --------- -------------- -------- ---- -------- --------- --- -------- --------- --------------
----------- -------- -- --------- -------------- -------- ---- -------- --------- --- -------- --------- --------------
----------- -------- -- --------- -------------- -------- ---- -------- --------- --- -------- --------- --------------
----------- -------- -- --------- -------------- -------- ---- -------- --------- --- -------- --------- --------------
----------- -------- -- --------- -------------- -------- ---- -------- --------- --- -------- --------- --------------
----------- -------- -- --------- -------------- -------- ---- -------- --------- --- -------- --------- --------------
X-0-0
XXXXXXX X
XXXXXXXXX XXXXXXX
Xxx Xxxx xx Xxxx Xxxxxx
000 Xxxxxxxxx Xxxxxx X.X.
Xxxxx 0000
Xxxxxxx, XX 00000
Attention: [Xx. Xxxxx Xxxxxxxx]
CALPINE CORPORATION
Gentlemen and Ladies:
This Borrowing Request is delivered to you pursuant to Section 2.3 of the
Credit Agreement, dated as of March 8, 2002 (together with all amendments, if
any, from time to time made thereto, the "Credit Agreement"), among Calpine
Corporation, a Delaware corporation (the "Borrower"), certain financial
institutions and The Bank of Nova Scotia, as agent (the "Agent"). Unless
otherwise defined herein or the context otherwise requires, terms used herein
have the meanings provided in the Credit Agreement.
The Borrower hereby requests that a [Revolving/Term B] Loan be made in the
aggregate principal amount of $________________________________________ on
__________, ____ as a [LIBO Rate Loan having an Interest Period of ______
months] [Base Rate Loan].
The Borrower hereby certifies that its Xxxxx'x Loan Rating is _____ and
that its S&P Loan Rating is _____. The Borrower hereby further certifies that
its incurrence of the Indebtedness evidenced by the Loans is permitted under
the terms of the Xxx-0000 Xxxxxxxxxx pursuant to Sections 3.4[_] thereof. If
the Borrower is relying on clause (a) of Section 3.4 of the Xxx-0000
Xxxxxxxxxx, the Borrower has attached hereto a certificate demonstrating its
compliance with the incurrence test set forth therein.
The Borrower hereby certifies to the Agent that the incurrence of Liens in
respect of such Borrowing is permitted under the terms of Section 3.7 of the
Xxx-0000 Xxxxxxxxxx and Section 3.4 of the Shelf Indenture. To the extent the
Borrower is relying on Section 3.7(f)(1) of each of the Xxx-0000 Xxxxxxxxxx and
on Section 3.4(a)(i) of the Shelf Indenture, the Borrower has attached a
certificate demonstrating its compliance with the provisions thereof. To the
extent that the Borrower is relying on the proviso to Section 3.7 of each of
the Xxx-0000 Xxxxxxxxxx and the proviso to Section 3.4 of the Shelf Indenture,
the Borrower has attached a certificate demonstrating its compliance with the
incurrence tests set forth therein.
The Borrower hereby acknowledges that, pursuant to Section 6.3.2 of the
Credit Agreement, each of the delivery of this Borrowing Request and the
acceptance by the Borrower of the proceeds of the Loans requested hereby
constitute a representation and warranty by the Borrower that, on the date of
such Loans, and before and after giving effect thereto and to the
B-1
application of the proceeds therefrom, all statements set forth in Section
6.3.1 are true and correct in all material respects.
The Borrower agrees that if prior to the time of the Borrowing requested
hereby any matter certified to herein by it will not be true and correct at
such time as if then made, it will immediately so notify the Agent. Except to
the extent, if any, that prior to the time of the Borrowing requested hereby
the Agent shall receive written notice to the contrary from the Borrower, each
matter certified to herein shall be deemed once again to be certified as true
and correct at the date of such Borrowing as if then made.
Please wire transfer the proceeds of the Borrowing to the accounts of
the following persons at the financial institutions indicated respectively:
Amount to be Transferred Name, Address, etc. of
------------
Lender Name Account No. Transferred
------ -----------
$
--------------------- --------------------- ------------------ ----------------------
----------------------
Attention: ----------------------
$
--------------------- --------------------- ------------------ ----------------------
----------------------
Attention: ----------------------
Balance of such proceeds The Borrower
------------------ ----------------------
----------------------
Attention: ----------------------
The Borrower has caused this Borrowing Request to be executed and
delivered, and the certification and warranties contained herein to be made, by
its duly Authorized Officer this ____ day of ___________, 200_.
CALPINE CORPORATION
By______________________________________________
Name:
Title:
X-0
XXXXXXX X
XXXXXXXXXXXX/XXXXXXXXXX XXXXXX
Xxx Xxxx xx Xxxx Xxxxxx
000 Xxxxxxxxx Xxxxxx X.X.
Xxxxx 0000
Xxxxxxx, XX 00000
Attention: [Xx. Xxxxx Xxxxxxxx]
CALPINE CORPORATION
Gentlemen and Ladies:
This Continuation/Conversion Notice is delivered to you pursuant to
Section 2.4 of the Credit Agreement, dated as of March 8, 2002 (together with
all amendments, if any, from time to time made thereto, the "Credit
Agreement"), among Calpine Corporation, a Delaware corporation (the
"Borrower"), certain financial institutions and The Bank Of Nova Scotia, as
agent (the "Agent"). Unless otherwise defined herein or the context otherwise
requires, terms used herein have the meanings provided in the Credit Agreement.
The Borrower hereby requests that on ___________, 200_,
(1) $___________ of the presently outstanding principal amount of
the Loans originally made on _________, 200_ [and $___________ of the
presently outstanding principal amount of the Loans originally made on
___________, 200_],
(2) and all presently being maintained as *[Base Rate Loans] [LIBO
Rate Loans],
(3) be [converted into] [continued as],
(4) **[LIBO Rate Loans having an Interest Period of _______
months] [Base Rate Loans].
The Borrower hereby:
(a) certifies and warrants that no Default has occurred and is
continuing; and
____________________________
* Select appropriate interest rate option.
** Insert appropriate interest rate option.
C-1
(b) agrees that if prior to the time of such continuation or
conversion any matter certified to herein by it will not be true and
correct at such time as if then made, it will immediately so notify the
Agent.
Except to the extent, if any, that prior to the time of the continuation or
conversion requested hereby the Agent shall receive written notice to the
contrary from the Borrower, each matter certified to herein shall be deemed to
be certified at the date of such continuation or conversion as if then made.
The Borrower has caused this Continuation/Conversion Notice to be executed
and delivered, and the certification and warranties contained herein to be
made, by its Authorized Officer this ___ day of__________, 200_.
CALPINE CORPORATION
By______________________________________________
Name:
Title:
C-2
EXHIBIT D
ISSUANCE REQUEST
The Bank of Nova Scotia,
acting as agent (the "Agent")
for the Lenders (defined below)
000 Xxxxxxxxx Xxxxxx X.X.
Xxxxx 0000
Xxxxxxx, XX 00000
Attention: [Xx. Xxxxx Xxxxxxxx]
Re: Credit Agreement, dated as of March 8, 2002 (together with all
amendments, if any, thereafter from time to time made thereto,
the "Credit Agreement"), among Calpine Corporation, (the
"Borrower"), various financial institutions (the "Lenders")
and the Agent.
Gentlemen/Ladies:
This Issuance Request is delivered to you pursuant to Section 4.1 of the
Credit Agreement. Unless otherwise defined herein, terms used herein have the
meanings assigned to them in the Credit Agreement. In the event of a conflict
between the terms and conditions of any application for a Letter of Credit and
the terms and conditions of the Credit Agreement, then the terms and conditions
of the Credit Agreement will control.
The Borrower hereby requests that on _________, 200_ (the "Date of
Issuance") [_____________] (the "Issuer") *[issue a [Foreign Currency] Letter
of Credit on ______________, 200_ in the initial Stated Amount of
[$_______________][Cdn $____________][[pound]____________] with a Stated Expiry
Date (as defined therein) of ______________, 200_] [extend the Stated Expiry
Date (as defined under Irrevocable Letter of Credit No.__, issued on
__________________________, 200_, in the initial Stated Amount of
[$______________][Cdn $____________][[pound]____________]) to a revised Stated
Expiry Date (as defined therein) of _________________, 200_].
Attached hereto is a duly executed application for [the issuance] [the
extension] of a [Foreign Currency] Letter of Credit on your standard form. Such
[Foreign Currency] Letter of Credit will be in support of
**________________________________.
____________________________
* Insert as appropriate.
** Insert description of supported Indebtedness or other obligations and name
of agreement to which it relates.
D-1
The Borrower hereby acknowledges that, pursuant to Section 6.3.2 of the
Credit Agreement, each of the delivery of this Issuance Request and the
[issuance][extension] of the [Foreign Currency] Letter of Credit requested
hereby constitutes a representation and warranty by the Borrower that, on such
date of [issuance] [extension] all statements set forth in Section 6.3.1 are
true and correct in all material respects.
The Borrower agrees that if, prior to the time of the *[issuance]
[extension] of the [Foreign Currency] Letter of Credit requested hereby, any
matter certified to herein by it will not be true and correct at such time as
if then made, it will immediately so notify the Agent. Except to the extent, if
any, that prior to the time of the issuance or extension requested hereby the
Agent and the Issuer shall receive written notice to the contrary from the
Borrower, each matter certified to herein shall be deemed to be certified at
the date of such issuance or extension.
IN WITNESS WHEREOF, the Borrower has caused this request to be executed
and delivered by its duly Authorized Officer this ___day of _____________, 200_.
CALPINE CORPORATION
By_______________________________________________
Name:
Title:
____________________________
* Complete as appropriate.
D-2
LENDER ASSIGNMENT AGREEMENT
To: Calpine Corporation
To: The Bank of Nova Scotia,
as the Agent
[Bayerische Landesbank Girozentrale,
as Issuer]
[Bankers Trust Company,
as Issuer]
CALPINE CORPORATION
Gentlemen and Ladies:
We refer to Section 11.11.1 of the Credit Agreement, dated as of March 8,
2002 (together with all amendments and other modifications, if any, from time
to time thereafter made thereto, the "Credit Agreement"), among Calpine
Corporation, a Delaware corporation (the "Borrower"), the various financial
institutions (the "Lenders") as are, or shall from time to time become, parties
thereto, and The Bank of Nova Scotia, as agent (the "Agent") for the Lenders.
Unless otherwise defined herein or the context otherwise requires, terms used
herein have the meanings provided in the Credit Agreement.
This agreement is delivered to you pursuant to Section 11.11.1 of the
Credit Agreement and also constitutes notice to each of you, pursuant to
Section 11.11.1 of the Credit Agreement, of the assignment and delegation to
_______________ (the "Assignee") of ___% of the [Revolving] [Term B] Loans and
[Revolving] [Term B] Loan Commitments of _____________ (the "Assignor")
outstanding under the Credit Agreement on the date hereof. After giving effect
to the foregoing assignment and delegation, the Assignor's and the Assignee's
[Revolving] [Term B] Percentages for the purposes of the Credit Agreement are
set forth opposite such Person's name on the signature pages hereof.
[Add paragraph dealing with accrued interest and fees with respect to
Loans assigned.]
The Assignee hereby acknowledges and confirms that it has received a copy
of the Credit Agreement and the exhibits related thereto, together with copies
of the documents which were required to be delivered under the Credit Agreement
as a condition to the making of the Credit Extensions thereunder. The Assignee
further confirms and agrees that in becoming a Lender and in making its
Commitments and Loans under the Credit Agreement, such actions have and will be
made without recourse to, or representation or warranty by the Agent.
E-1
Except as otherwise provided in the Credit Agreement, effective as of the
date of acceptance hereof by the Agent
(a) the Assignee
(i) shall be deemed automatically to have become a party to
the Credit Agreement, have all the rights and obligations of a
"Lender" under the Credit Agreement and the other Loan Documents as
if it were an original signatory thereto to the extent specified in
the second paragraph hereof; and
(ii) agrees to be bound by the terms and conditions set forth
in the Credit Agreement and the other Loan Documents as if it were an
original signatory thereto; and
(b) the Assignor shall be released from its obligations under the
Credit Agreement and the other Loan Documents to the extent specified in
the second paragraph hereof with respect to obligations arising after the
effective date of this assignment.
The Assignor and the Assignee hereby agree that the [Assignor] [Assignee]
will pay to the Agent the processing fee referred to in Section 11.11.1 of the
Credit Agreement upon the delivery hereof.
The Assignee hereby advises each of you of the following administrative
details with respect to the assigned Loans and Commitments and requests the
Agent to acknowledge receipt of this document:
(A) Address for Notices:
Institution Name:
Attention:
Domestic Office:
Telephone:
Facsimile:
LIBOR Office:
Telephone:
Facsimile:
(B) Payment Instructions:
The Assignee agrees to furnish the tax form required by the last sentence
of Section 5.6 (if so required) of the Credit Agreement no later than the date
of acceptance hereof by the Agent.
E-2
This Agreement may be executed by the Assignor and Assignee in separate
counterparts, each of which when so executed and delivered shall be deemed to
be an original and all of which taken together shall constitute one and the
same agreement.
Adjusted [Revolving] [Term] Percentage [ASSIGNOR]
[Revolving] [Term B] Loan Commitment
and Loans: __%
[Letters of Credit: __%] By ___________________________
Title:
[Revolving] [Term] Percentage [ASSIGNEE]
[Revolving] [Term B] Loan Commitment
and Loans: __%
[Letters of Credit: __%] By ___________________________
Title:
Accepted and Acknowledged
this ______ day of _________, 200_
The Bank of Nova Scotia,
as Agent
By___________________________________
Title:
[Bayerische Landesbank Girozentrale,
as Issuer
By___________________________________
Title:
Bankers Trust Company,
as Issuer
By___________________________________
Title:]
E-3
Consented to and acknowledged
this _____ day of __________, 200_
Calpine Corporation
By___________________________________
Title:
E-4
EXHIBIT F
[Opinions of Counsel to the Borrower]
F-1
EXHIBIT G
March 8, 2002
To the Agent and Banks party to
the hereinafter described
Credit Agreement
Re: Calpine Corporation
Gentlemen:
We have participated in the preparation of the Credit Agreement dated as
of March 8, 2002 (the "Credit Agreement") among Calpine Corporation
("Borrower"), the banks listed on the signature pages thereof (the "Banks") and
The Bank of Nova Scotia, as agent (the "Agent"), and have acted as special
counsel for the Agent for purposes of rendering this opinion. Terms defined in
the Credit Agreement are used herein as therein defined.
We have examined originals or copies, certified to our satisfaction, of
such documents, corporate records, certificates of public officials and other
instruments and have conducted such other investigations of fact and law as we
have deemed necessary or advisable for purposes of this opinion.
Upon the basis of the foregoing, we are of the opinion that the documents
delivered to the Agent by the Borrower pursuant to Sections 6.1.1 through
6.1.10 of the Credit Agreement are substantially responsive to the requirements
of said Sections and the delivery of such documents satisfies the conditions
precedent set forth therein.
We are members of the Bar of the State of California, and the foregoing
opinion is limited to the laws of the State of California and the federal laws
of the United States of America.
This opinion is rendered solely to you in connection with the above
matter. This opinion may not be relied upon by you for any other purpose or
relied upon by or furnished to any other person without our prior written
consent.
Very truly yours,
MAYER, BROWN, XXXX & MAW
By______________________________________________
Its Partner
G-1
TABLE OF CONTENTS
PAGE
ARTICLE I DEFINITIONS AND ACCOUNTING TERMS ................................................................. 2
SECTION 1.1. Defined Terms............................................................... 2
SECTION 1.2. Use of Defined Terms........................................................ 27
SECTION 1.3. Cross-References............................................................ 27
SECTION 1.4. Accounting and Financial Determinations..................................... 27
ARTICLE II COMMITMENTS, BORROWING PROCEDURES AND NOTES............................................... 27
SECTION 2.1. Commitments................................................................. 27
SECTION 2.2. Reduction of Commitment Amounts............................................. 29
SECTION 2.3. Borrowing Procedure......................................................... 30
SECTION 2.4. Continuation and Conversion Elections....................................... 30
SECTION 2.5. Funding..................................................................... 30
SECTION 2.6. Notes; Register............................................................. 31
SECTION 2.7. Increase in Revolving Commitment Amount..................................... 31
SECTION 2.8. Increase in Term B Loan Commitment Amount................................... 32
ARTICLE III REPAYMENTS, PREPAYMENTS, INTEREST AND FEES................................................ 33
SECTION 3.1. Repayments and Prepayments.................................................. 33
SECTION 3.2. Interest Provisions......................................................... 34
SECTION 3.3. Fees........................................................................ 36
ARTICLE IV LETTERS OF CREDIT......................................................................... 37
SECTION 4.1. Issuance Requests........................................................... 37
SECTION 4.2. Issuances and Extensions.................................................... 38
SECTION 4.3. Expenses.................................................................... 38
SECTION 4.4. Other Revolving Lenders' Participation...................................... 39
SECTION 4.5. Disbursements............................................................... 39
SECTION 4.6. Reimbursement............................................................... 40
SECTION 4.7. Cash Collateral............................................................. 41
SECTION 4.8. Nature of Reimbursement Obligations......................................... 41
SECTION 4.9. Increased Costs; Indemnity.................................................. 42
SECTION 4.10. Existing Letters of Credit.................................................. 44
SECTION 4.11. Equivalent Amount Determinations............................................ 44
i
TABLE OF CONTENTS
(continued)
PAGE
SECTION 4.12. Currency Fluctuations, etc.................................................. 44
ARTICLE V CERTAIN LIBO RATE AND OTHER PROVISIONS ............................................................ 44
SECTION 5.1. LIBO Rate Lending Unlawful.................................................. 44
SECTION 5.2. Deposits Unavailable........................................................ 45
SECTION 5.3. Increased LIBO Rate Loan Costs, etc......................................... 45
SECTION 5.4. Funding Losses.............................................................. 46
SECTION 5.5. Increased Capital Costs..................................................... 46
SECTION 5.6. Taxes....................................................................... 47
SECTION 5.7. Payments, Computations, etc................................................. 48
SECTION 5.8. Sharing of Payments......................................................... 48
SECTION 5.9. Use of Proceeds............................................................. 49
ARTICLE VI CONDITIONS PRECEDENT...................................................................... 49
SECTION 6.1. Initial Credit Extension.................................................... 49
SECTION 6.2. Term B Loan Borrowing....................................................... 52
SECTION 6.3. All Credit Extensions....................................................... 53
ARTICLE VII REPRESENTATIONS AND WARRANTIES............................................................ 54
SECTION 7.1. Organization, etc........................................................... 54
SECTION 7.2. Due Authorization, Non-Contravention, etc................................... 55
SECTION 7.3. Government Approval, Regulation, etc........................................ 55
SECTION 7.4. Validity, etc............................................................... 55
SECTION 7.5. Financial Information....................................................... 55
SECTION 7.6. No Material Adverse Effect. Except for Excepted Prospects, since
December 31, 2000, there has been no Material Adverse Effect and no
material adverse development in the matters set forth as Excepted
Prospects that could have a material adverse effect upon the
financial condition, operations, assets (including power projects),
business or prospects of the Borrower and its Significant
Subsidiaries taken as a whole............................................... 56
SECTION 7.7. Litigation, Labor Controversies, etc........................................ 56
SECTION 7.8. Subsidiaries................................................................ 56
SECTION 7.9. Ownership of Properties..................................................... 56
ii
TABLE OF CONTENTS
(continued)
PAGE
SECTION 7.10. Taxes....................................................................... 57
SECTION 7.11. Pension and Welfare Plans................................................... 57
SECTION 7.12. Environmental Warranties.................................................... 57
SECTION 7.13. Regulations U and X......................................................... 58
SECTION 7.14. Accuracy of Information..................................................... 58
SECTION 7.15. Protection under Pledge Agreements and Deeds of Trust....................... 59
SECTION 7.16. Indebtedness of Certain Subsidiaries........................................ 59
SECTION 7.17. Designation of Subsidiaries................................................. 59
ARTICLE VIII COVENANTS................................................................................. 59
SECTION 8.1. Affirmative Covenants....................................................... 59
SECTION 8.2. Negative Covenants.......................................................... 63
SECTION 8.3. No Restriction on Payments to the Borrower.................................. 72
ARTICLE IX EVENTS OF DEFAULT......................................................................... 72
SECTION 9.1. Listing of Events of Default................................................ 72
SECTION 9.2. Action if Bankruptcy........................................................ 75
SECTION 9.3. Action if Other Event of Default............................................ 75
ARTICLE X THE AGENT AND ADMINISTRATIVE AGENTS....................................................... 75
SECTION 10.1. Actions..................................................................... 75
SECTION 10.2. Funding Reliance, etc....................................................... 76
SECTION 10.3. Exculpation................................................................. 76
SECTION 10.4. Successor................................................................... 76
SECTION 10.5. Loans or Letters of Credit Issued by Agent, either Administrative
Agent or any Issuer......................................................... 77
SECTION 10.6. Credit Decisions............................................................ 77
SECTION 10.7. Copies, etc................................................................. 78
SECTION 10.8. Other Agents; Lead Arrangers................................................ 78
ARTICLE XI MISCELLANEOUS PROVISIONS.................................................................. 78
SECTION 11.1. Waivers, Amendments, etc.................................................... 78
SECTION 11.2. Notices..................................................................... 80
SECTION 11.3. Payment of Costs and Expenses............................................... 80
SECTION 11.4. Indemnification............................................................. 81
iii
TABLE OF CONTENTS
(continued)
PAGE
SECTION 11.5. Survival.................................................................... 82
SECTION 11.6. Severability................................................................ 82
SECTION 11.7. Headings.................................................................... 82
SECTION 11.8. Execution in Counterparts, Effectiveness, etc............................... 82
SECTION 11.9. Governing Law; Entire Agreement............................................. 83
SECTION 11.10. Successors and Assigns...................................................... 83
SECTION 11.11. Sale and Transfer of Loans and Notes; Participations in Loans and
Notes....................................................................... 83
SECTION 11.12. Other Transactions.......................................................... 86
SECTION 11.13. Forum Selection and Consent to Jurisdiction................................. 86
SECTION 11.14. Waiver of Jury Trial........................................................ 87
SECTION 11.15. Confidentiality............................................................. 87
SECTION 11.16. Judgment Currency........................................................... 88
iv
SCHEDULE I - Disclosure Schedule
SCHEDULE II - Percentages
SCHEDULE 4.10 - Existing Letters of Credit
EXHIBIT A-1 - Form of Revolving Note
EXHIBIT A-2 - Form of Term Note
EXHIBIT B - Form of Borrowing Request
EXHIBIT C - Form of Continuation/Conversion Notice
EXHIBIT D - Form of Issuance Request
EXHIBIT E - Form of Lender Assignment Agreement
EXHIBIT F - Form of Opinion of Counsel to the Borrower
EXHIBIT G - Form of Opinion of Counsel to the Agent
EXHIBIT H - Form of Guaranty
EXHIBIT I - Form of Pledge Agreements
EXHIBIT J - Form of Hazardous Materials Indemnity
EXHIBIT K - Form of Assignment Agreement
v
