CONFORMED COPY
_______________________________________________________________________________
CREDIT AGREEMENT
among
VIRGINIA ELECTRIC AND POWER COMPANY
The Several Lenders
from Time to Time Parties Hereto
and
CHEMICAL BANK,
as Administrative Agent
Dated as of September 1, 1995
_______________________________________________________________________________
TABLE OF CONTENTS
Page
SECTION 1. DEFINITIONS ....................................................... 1
1.1 Defined Terms ...................................................... 1
1.2 Other Definitional Provisions ...................................... 10
SECTION 2. AMOUNT AND TERMS OF THE CREDIT FACILITIES ......................... 11
2.1 The Commitments .................................................... 11
2.2 Procedure for Revolving Credit Borrowing ........................... 11
2.3 Facility Fee ....................................................... 11
2.4 Termination or Reduction of Commitments ............................ 12
2.5 Repayment of Loans; Evidence of Debt ............................... 12
2.6 Optional Prepayments ............................................... 13
2.7 Conversion and Continuation Options ................................ 13
2.8 Minimum Amounts and Maximum Number of Tranches ..................... 13
2.9 The Competitive Loans .............................................. 14
2.10 Procedure for and Payment of Competitive Loan Borrowing ............ 14
2.11 Interest Rates and Payment Dates ................................... 17
2.12 Computation of Interest and Fees ................................... 18
2.13 Inability to Determine Interest Rate ............................... 18
2.14 Pro Rata Treatment and Payments .................................... 19
2.15 Illegality ......................................................... 20
2.16 Additional Costs .................................................. 20
2.17 Taxes .............................................................. 21
2.18 Indemnity .......................................................... 24
2.19 Change of Lending Office ........................................... 24
2.20 Replacement of Lenders under Certain Circumstances ................. 24
SECTION 3. REPRESENTATIONS AND WARRANTIES .................................... 25
3.1 Financial Condition ................................................ 25
3.2 No Change .......................................................... 26
3.3 Corporate Existence; Compliance with Law ........................... 26
3.4 Corporate Power; No Legal Bar ...................................... 26
3.5 Authorization; Enforceability ...................................... 26
3.6 ERISA .............................................................. 26
3.7 No Material Litigation ............................................. 26
3.8 Taxes .............................................................. 27
3.9 Purpose of Loans ................................................... 27
SECTION 4. CONDITIONS PRECEDENT .............................................. 27
4.1 Conditions to Initial Loans ........................................ 27
4.2 Conditions to Each Loan ............................................ 28
SECTION 5. COVENANTS ......................................................... 28
5.1 Financial Statements ............................................... 28
5.2 Conduct of Business and Compliance ................................. 29
5.3 Books and Records .................................................. 29
5.4 Notices ............................................................ 30
5.5 Limitation on Liens ................................................ 30
5.6 Limitation on Fundamental Changes .................................. 30
5.7 Limitation on Guarantee Obligations ................................ 30
5.8 Maintenance of Net Worth ........................................... 31
SECTION 6. EVENTS OF DEFAULT ................................................. 31
SECTION 7. THE ADMINISTRATIVE AGENT .......................................... 33
7.1 Appointment ........................................................ 33
7.2 Delegation of Duties ............................................... 33
7.3 Exculpatory Provisions ............................................. 33
7.4 Reliance by Administrative Agent ................................... 34
7.5 Notice of Default .................................................. 34
7.6 Non-Reliance on Administrative Agent and Other Lenders ............. 34
7.7 Indemnification .................................................... 35
7.8 Administrative Agent in Its Individual Capacity .................... 35
7.9 Successor Administrative Agent ..................................... 35
SECTION 8. MISCELLANEOUS ..................................................... 36
8.1 Amendments and Waivers ............................................. 36
8.2 Notices ............................................................ 36
8.3 No Waiver; Cumulative Remedies ..................................... 37
8.4 Survival ........................................................... 37
8.5 Payment of Expenses ................................................ 37
8.6 Transfer Provisions ................................................ 38
8.7 Adjustments ........................................................ 39
8.8 Counterparts ....................................................... 40
8.9 Severability ....................................................... 40
8.10 Integration ........................................................ 40
8.11 GOVERNING LAW ...................................................... 40
8.12 WAIVERS OF JURY TRIAL .............................................. 40
8.13 Confidentiality .................................................... 40
SCHEDULES
I Lending Offices and Commitments
II Facility Fee/Applicable Margin
III Permitted Guarantee Obligations
EXHIBITS
A-1 Form of Revolving Credit Note
A-2 Form of Competitive Loan Note
B-1 Form of Competitive Loan Confirmation
B-2 Form of Competitive Loan Offer
B-3 Form of Competitive Loan Request
C Form of Closing Certificate
D-1 Form of Legal Opinion of General Counsel of the Borrower
D-2 Form of Legal Opinion of Xxxxxxx Xxxxxxx & Xxxxxxxx
E Form of Assignment and Acceptance
CREDIT AGREEMENT, dated as of September 1, 1995, among VIRGINIA
ELECTRIC AND POWER COMPANY, a Virginia public service corporation (the
"Borrower"), the several banks and other financial institutions from time to
time parties to this Agreement (the "Lenders") and Chemical Bank, a New York
banking corporation, as administrative agent for the Lenders hereunder (in such
capacity, the "Administrative Agent").
WITNESSETH:
The parties hereto hereby agree as follows:
SECTION 1. DEFINITIONS
1.1 Defined Terms. As used in this Agreement, the following terms
shall have the following meanings:
"ABR": for any day, a rate per annum (rounded upwards, if necessary,
to the next 1/16 of 1%) equal to the greater of (a) the Prime Rate in
effect on such day and (b) the Federal Funds Effective Rate in effect on
such day plus 1/2 of 1%. Any change in the ABR due to a change in the
Prime Rate or the Federal Funds Effective Rate shall be effective as of
the opening of business on the effective day of such change in the Prime
Rate or the Federal Funds Effective Rate.
"ABR Loans": Revolving Credit Loans the rate of interest applicable
to which is the ABR.
"Additional Costs": as defined in subsection 2.16(a).
"Affiliate": as to any Person, any other Person which, directly or
indirectly, is in control of, is controlled by, or is under common control
with, such Person. For purposes of this definition, "control" of a Person
means the power, directly or indirectly, either to (a) vote 10% or more of
the securities having ordinary voting power for the election of directors
of such Person or (b) direct or cause the direction of the management and
policies of such Person, whether by contract or otherwise.
"Agreement": this Credit Agreement, as amended, supplemented or
otherwise modified from time to time.
"Applicable Lending Office": each Lender's lending office designated
in Schedule I or such other office of such Lender notified to the
Administrative Agent and Borrower.
"Applicable Margin": the rate per annum set forth in Schedule II
under the applicable S&P Bond Rating and Moody's Bond Rating.
"Assignee": as defined in subsection 8.6(c).
"Board": the Board of Governors of the Federal Reserve System (or
any successor).
"Borrowing Date": any Business Day specified in a notice given by
the Borrower pursuant to subsection 2.2 or 2.10 as a date on which the
Loans are to be made hereunder.
"Business Day": a day other than a Saturday, Sunday or other day on
which commercial banks in New York City are authorized or required by law
to close, except that, when used in connection with a LIBOR Loan or LIBOR
Competitive Loan, the term "Business Day" shall mean any Business Day on
which dealings in foreign currencies and exchange between banks may be
carried on in London, England and New York, New York.
"CD Assessment Rate": for any day as applied to any CD Rate Loan,
the annual assessment rate in effect on such day which is payable by a
member of the Bank Insurance Fund maintained by the Federal Deposit
Insurance Corporation (the "FDIC") classified as well-capitalized and
within supervisory subgroup "B" (or a comparable successor assessment risk
classification) within the meaning of 12 C.F.R. (S) 327.4(a) (or any
successor provision) to the FDIC (or any successor) for the FDIC's (or such
successor's) insuring time deposits at offices of such institution in the
United States.
"CD Base Rate": with respect to each day during each Interest Period
pertaining to a CD Rate Loan, the rate of interest per annum determined by
the Agent to be the rate notified to the Agent by Chemical as the average
rate bid at 9:00 A.M., New York City time, or as soon thereafter as
practicable, on the first day of such Interest Period by a total of three
certificate of deposit dealers of recognized standing selected by Chemical
for the purchase at face value from Chemical of its certificates of deposit
in an amount comparable to the CD Rate Loan of Chemical to which such
Interest Period applies and having a maturity comparable to such Interest
Period.
"CD Rate": with respect to each day during each Interest Period
pertaining to a CD Rate Loan, a rate per annum determined for such day in
accordance with the following formula (rounded upward to the nearest
l/lOOth of 1%):
CD Base Rate + CD Assessment Rate
1.00 - CD Reserve Percentage
"CD Rate Loans": Loans the rate of interest applicable to which is
based upon the CD Rate.
"CD Reserve Percentage": for any day as applied to any CD Rate Loan,
that percentage (expressed as a decimal) which is in effect on such day, as
prescribed by the Board, for determining the maximum reserve requirement
for a Depositary Institution (as defined in Regulation D of the Board) in
respect of new non-personal time deposits in Dollars having a maturity
comparable to the Interest Period for such CD Rate Loan.
2
"Chemical": Chemical Bank.
"Closing Date": the date on which the conditions precedent set forth
in subsection 4.1 shall be satisfied or waived in accordance with
subsection 8.1.
"Code": the Internal Revenue Code of 1986, as amended from time to
time.
"Commitment": as to any Lender, the obligation of such Lender to
make Revolving Credit Loans in an aggregate principal amount at any one
time outstanding not to exceed the amount set forth opposite such Lender's
name on Schedule I, as such amount may be changed from time to time in
accordance with this Agreement.
"Commitment Percentage": as to any Lender at any time, the
percentage which such Lender's Commitment then constitutes of the aggregate
Commitments (or, at any time after the Commitments shall have expired or
terminated, the percentage which the aggregate principal amount of such
Lender's Loans then outstanding constitutes of the aggregate principal
amount of the Loans then outstanding).
"Commitment Period": the period from and including the Closing Date
to but not including the Termination Date or such earlier date on which the
Commitments shall terminate as provided herein.
"Commonly Controlled Entity": an entity, whether or not
incorporated, which is under common control with the Borrower within the
meaning of Section 4001 of ERISA or is part of a group which includes the
Borrower and which is treated as a single employer under Section 414 of the
Code.
"Competitive Loan Confirmation": each confirmation by the Borrower
of its acceptance of Competitive Loan Offers, which Competitive Loan
Confirmation shall be substantially in the form of Exhibit X-x and shall be
delivered to the Administrative Agent in writing or by facsimile
transmission.
"Competitive Loan Lender": each Lender that has agreed to offer to
make Competitive Loans hereunder and each other Lender that shall hereafter
become a Competitive Loan Lender in accordance with the provisions of
subsection 8.6
"Competitive Loan Maturity Date": as to any Competitive Loan, the
date specified by the Borrower pursuant to subsection 2.10(d)(ii) in its
acceptance of the related Competitive Loan Offer.
"Competitive Loan Note": as defined in subsection 2.10(i).
"Competitive Loan Offer": each offer by a Competitive Loan Lender to
make Competitive Loans pursuant to a Competitive Loan Request, which
Competitive Loan Offer shall contain the information specified in Exhibit
B-2 and shall be delivered to the Administrative Agent by telephone,
immediately confirmed by facsimile transmission.
3
"Competitive Loan Request": each request by the Borrower for
Competitive Loans, which request shall contain the information specified in
Exhibit B-3 and shall be delivered to the Administrative Agent in writing
or by facsimile transmission, or by telephone, immediately confirmed by
facsimile transmission.
"Competitive Loan": each loan made pursuant to subsection 2.9.
"Consolidated Net Worth": as of the date of determination, all items
which in conformity with GAAP would be included under stockholders' equity
on a consolidated balance sheet of the Borrower and its consolidated
Subsidiaries, if any, at such date, including preferred stock issued by the
Borrower.
"Default": any of the events specified in Section 6, whether or not
any requirement for the giving of notice, the lapse of time, or both, or
any other condition, has been satisfied.
"Dollars" and "$": dollars in lawful currency of the United States
of America.
"Dominion Resources": Dominion Resources, Inc., a Virginia
corporation.
"ERISA": the Employee Retirement Income Security Act of 1974, as
amended from time to time.
"Eurocurrency Reserve Requirements": for any day as applied to a
LIBOR Loan or a LIBOR Competitive Loan, as the case may be, the aggregate
(without duplication) of the rates (expressed as a decimal fraction) of
reserve requirements in effect on such day (including, without limitation,
basic, supplemental, marginal and emergency reserves under any regulations
of the Board or other Governmental Authority having jurisdiction with
respect thereto) dealing with reserve requirements prescribed for
eurocurrency funding (currently referred to as "Eurocurrency Liabilities"
in Regulation D of the Board) maintained by a member bank of the Federal
Reserve System.
"Event of Default": any of the events specified in Section 6,
provided that any requirement for the giving of notice, the lapse of time,
or both, or any other condition, has been satisfied.
"Facility Fee Rate": the rate per annum set forth in Schedule II
under the applicable S&P Bond Rating and Moody's Bond Rating.
"Federal Funds Effective Rate": for any day, the weighted average of
the rates on overnight federal funds transactions with members of the
Federal Reserve System arranged by federal funds brokers, as published on
the next succeeding Business Day by the Federal Reserve Bank of New York,
or, if such rate is not so published for any day which is a Business Day,
the average of the quotations for the day of such transactions received by
the Administrative Agent from three federal funds brokers of recognized
standing selected by it.
5
"First Mortgage Bond Indenture": the first mortgage bond indenture,
dated November 1, 1935, by and between the Company and Chase Manhattan Bank,
as supplemented and amended.
"Fixed Rate Competitive Loan Request": any Competitive Loan Request
requesting the Competitive Loan Lenders to offer to make Fixed Rate
Competitive Loans.
"Fixed Rate Competitive Loans": Competitive Loans the rate of
interest applicable to which is equal to a fixed percentage rate per annum
specified by the Competitive Loan Lender making such Loan in its Competitive
Loan Offer (as opposed to a rate composed of LIBOR plus or minus a margin).
"GAAP": generally accepted accounting principles in the United States
of America in effect from time to time.
"Governmental Authority": any nation or government, any state or
other political subdivision thereof and any entity exercising executive,
legislative, judicial, regulatory or administrative functions of or
pertaining to government.
"Guarantee Obligation": as to any Person (the "guaranteeing person"),
any obligation of:
(a) the guaranteeing person or
(b) another Person (including, without limitation, any bank under
any letter of credit), when the creation of such obligation was
induced by a reimbursement, counterindemnity or similar
obligation issued by the guaranteeing person,
in either case guaranteeing or in effect guaranteeing any Indebtedness,
leases, dividends or other obligations (the "primary obligations") of any
other third Person (the "primary obligor") in any manner, whether directly
or indirectly, including, without limitation, any obligation of the
guaranteeing person, whether or not contingent, (i) to purchase any such
primary obligation or any property constituting direct or indirect security
therefor, (ii) to advance or supply funds (1) for the purchase or payment
of any such primary obligation or (2) to maintain working capital or equity
capital of the primary obligor or otherwise to maintain the net worth or
solvency of the primary obligor, (iii) to purchase property, securities or
services primarily for the purpose of assuring the owner of any such
primary obligation of the ability of the primary obligor to make payment of
such primary obligation or (iv) otherwise to assure or hold harmless the
owner of any such primary obligation against loss in respect thereof;
provided, however, that the term Guarantee Obligation shall not include
endorsements of instruments for deposit or collection in the ordinary
course of business. The amount of any Guarantee Obligation of any
guaranteeing person shall be deemed to be the lower of (a) an amount equal
to the stated or determinable amount of the primary obligation in respect
of which such Guarantee Obligation is made and (b) the maximum amount for
which such guaranteeing person
6
may be liable pursuant to the terms of the instrument embodying such
Guarantee Obligation, unless such primary obligation and the maximum amount
for which such guaranteeing person may be liable are not stated or
determinable, in which case the amount of such Guarantee Obligation shall
be such guaranteeing person's maximum reasonably anticipated liability in
respect thereof as determined by the Borrower in good faith.
"Indebtedness": of any Person at any date, (a) all indebtedness of
such Person for borrowed money or for the deferred purchase price of
property or services (other than current trade liabilities incurred in the
ordinary course of business and payable in accordance with customary
practices), (b) any other indebtedness of such Person which is evidenced by
a note, bond, debenture or similar instrument, (c) all obligations of such
Person as lessee which are capitalized in accordance with GAAP, (d) all
obligations of such Person in respect of acceptances issued or created for
the account of such Person and (e) all liabilities secured by any Lien on
any property owned by such Person even though such Person has not assumed
or otherwise become liable for the payment thereof.
"Interest Payment Date": (a) as to any ABR Loan, the last day of
each March, June, September and December and the Termination Date, (b) as
to any LIBOR Loan having an Interest Period of three months or less and any
CD Rate Loan having an lnterest Period of 90 days or less, the last day of
such Interest Period, (c) as to any LIBOR Loan or CD Rate Loan having an
Interest Period longer than three months or 90 days, respectively, each day
which is three months or 90 days, respectively, or a whole multiple
thereof, after the first day of such Interest Period and the last day of
such Interest Period, (d) as to any Fixed Rate Competitive Loan, each
interest payment date specified by the Borrower for such Loan in the
related Competitive Loan Request (including, in any event, the applicable
Competitive Loan Maturity Date) and (e) as to any LIBOR Competitive Loan,
(i) the applicable Competitive Loan Maturity Date and (ii) each date (if
any) occurring prior to such Competitive Loan Maturity Date which is three
months, or a whole multiple thereof, after the Borrowing Date in respect of
such Loan
"Interest Period": (a) with respect to any LIBOR Loan:
(i) initially, the period commencing on the borrowing or
conversion date, as the case may be, with respect to such LIBOR Loan and
ending one, two, three, six or, to the extent available as
determined by the Administrative Agent, nine or twelve months
thereafter, as selected by the Borrower in its notice of borrowing or
notice of conversion, as the case may be, given with respect
thereto; and
(ii) thereafter, each period commencing on the last day
of the next preceding Interest Period applicable to such LIBOR Loan
and ending one, two, three, six or, to the extent available as
determined by the Administrative Agent, nine or twelve months
thereafter, as selected by the Borrower by irrevocable
7
notice to the Administrative Agent not less than three Business Days
prior to the last day of the then current Interest Period with respect
thereto;
and (b) with respect to any CD Rate Loan:
(i) initially, the period commencing on the borrowing or
conversion date, as the case may be, with respect to such CD Rate Loan
and ending 30, 60, 90 or 180 days thereafter, as selected by the
Borrower in its notice of borrowing or notice of conversion, as the
case may be, given with respect thereto; and
(ii) thereafter, each period commencing on the last day of
the next preceding Interest Period applicable to such CD Rate Loan and
ending 30, 60, 90 or 180 days thereafter, as selected by the Borrower
by irrevocable notice to the Agent not less than three Business Days
prior to the last day of the then current Interest Period with respect
thereto;
and (c) with respect to any LIBOR Competitive Loan, the period specified in
the Competitive Loan Request for the LIBOR Competitive Loan with the
maturity date corresponding to the LIBOR Competitive Loan accepted by the
Borrower in the Competitive Loan Confirmation;
provided that, all of the foregoing provisions relating to Interest Periods
are subject to the following:
(1) if any Interest Period pertaining to a LIBOR Loan would
otherwise end on a day that is not a Business Day, such Interest
Period shall be extended to the next succeeding Business Day unless
the result of such extension would be to carry such Interest Period
into another calendar month in which event such Interest Period shall
end on the immediately preceding Business Day;
(2) if any Interest Period pertaining to a CD Rate Loan would
otherwise end on a day that is not a Business Day, such Interest
Period shall be extended to the next succeeding Business Day;
(3) any Interest Period that would otherwise extend beyond the
Termination Date shall end on the Termination Date;
(4) any Interest Period pertaining to a LIBOR Loan that begins
on the last Business Day of a calendar month (or on a day for which
there is no numerically corresponding day in the calendar month at the
end of such Interest Period) shall end on the last Business Day of a
calendar month; and
(5) the Borrower shall select Interest Periods so as not to
require a payment or prepayment of any LIBOR Loan or CD Rate Loan
during an Interest Period for such Loan.
8
"LIBOR": with respect to each day during each Interest Period
pertaining to a LIBOR Loan or a LIBOR Competitive Loan, the rate per annum
equal to the rate at which Chemical is offered Dollar deposits at or about
11:00 A.M., London time, two Business Days prior to the beginning of such
Interest Period, in the London interbank eurodollar market where the
eurodollar and foreign currency and exchange operations in respect of its
LIBOR Loans are then being conducted, for delivery on the first day of such
Interest Period for the number of days comprised therein and in an amount
comparable to the amount of its LIBOR Loan (or, in the case of a LIBOR
Competitive Loan, an amount that would have been Chemical's portion of such
LIBOR Competitive Loan had such Loan been a LIBOR Loan) to be outstanding
during such Interest Period.
"LIBOR Competitive Loan": Competitive Loans the rate of interest
applicable to which is equal to LIBOR plus or minus a margin.
"LIBOR Competitive Loan Request": any Competitive Loan Request requesting
the Competitive Loan Lenders to offer to make LIBOR Competitive Loans.
"LIBOR Loans": Revolving Credit Loans the rate of interest applicable to
which is based upon LIBOR.
"Lien": any mortgage, pledge, hypothecation, assignment, deposit
arrangement, encumbrance, lien (statutory or other), charge or other
security interest or any preference, priority or other security agreement or
preferential arrangement of any kind or nature whatsoever (including, without
limitation, any conditional sale or other title retention agreement and any
capitalized lease obligation having substantially the same economic effect as
any of the foregoing).
"Loan": any Revolving Credit Loan or Competitive Loan made by any Lender
pursuant to this Agreement.
"Loan Documents": this Agreement and any Notes.
"Majority Lenders": at any time, Lenders the Commitment Percentages of
which aggregate more than 50%.
"Material Subsidiary": means a Subsidiary of the Borrower whose total
assets, as determined in accordance with GAAP, represent at least 20% of the
total assets of the Borrower, on a consolidated basis, as determined in
accordance with GAAP.
"Moody's Bond Rating" means for any day, the rating of the
Borrower's senior secured long-term debt or if there is no senior secured
debt, the Borrower's senior long-term unsecured debt by Xxxxx'x Investor
Service, Inc. in effect at 11:00 A.M., New York City time, on such day.
"Non-Excluded Taxes": as defined in subsection 2.17(a).
9
"Notes": the collective reference to the Revolving Credit Notes and the
Competitive Loan Notes.
"Participant": as defined in subsection 8.6(b).
"PBGC": the Pension Benefit Guaranty Corporation established pursuant to
Subtitle A of Title IV of ERISA.
"Person": an individual, partnership, corporation, business trust, joint
stock company, trust, unincorporated association, joint venture, Governmental
Authority or other entity of whatever nature.
"Plan": at a particular time, any employee benefit plan which is
covered by ERISA and in respect of which the Borrower or a Commonly
Controlled Entity is (or, if such plan were terminated at such time, would
under Section 4069 of ERISA be deemed to be) an "employer" as defined in
Section 3(5) of ERISA.
"Prime Rate": the rate of interest per annum publicly announced from time
to time by Chemical as its prime rate in effect at its principal office in
New York City (the Prime Rate not being intended to be the lowest rate of
interest charged by Chemical in connection with extensions of credit to
debtors).
"Register": as defined in subsection 8.6(d)
"Regulatory Change": shall mean, as to any Lender, any change
occurring or taking effect after the date of this Agreement in Federal,
state, local or foreign laws or regulations, or the adoption or making or
taking effect after such date of any interpretations, directives, or
requests applying to a class of lenders including the Lenders of or under any
Federal, state, local or foreign laws or regulations (whether or not having
the force of law) by any court or governmental or monetary authority charged
with the interpretation or administration thereof.
"Requirement of Law": as to any Person, the Certificate of
Incorporation and By-Laws or other organizational or governing documents of such
Person, and any law, treaty, rule or regulation or determination of an
arbitrator or a court or other Governmental Authority, in each case
applicable to or binding upon such Person or any of its property or to
which such Person or any of its property is subject.
"Responsible Officer": the President, any Vice President, the Treasurer
or any Assistant Treasurer of the Borrower.
"Revolving Credit Loans": as defined in subsection 2.1.
"Revolving Credit Note": as defined in subsection 2.5(e).
10
"S&P Bond Rating" means for any day, the rating of the Borrower's
senior secured long-term debt or if there is no senior secured debt, the
Borrower's senior long-term unsecured debt by Standard & Poor's Ratings
Group in effect at 11:00 A.M., New York City time, on such day.
"Subsidiary": as to any Person, a corporation, partnership or other
entity of which shares of stock or other ownership interests having
ordinary voting power (other than stock or such other ownership interests
having such power only by reason of the happening of a contingency) to
elect a majority of the board of directors or other managers of such
corporation, partnership or other entity are at the time owned, or the
management of which is otherwise controlled, directly or indirectly
through one or more intermediaries, or both, by such Person. Unless
otherwise qualified, all references to a "Subsidiary" or to
"Subsidiaries" in this Agreement shall refer to a Subsidiary or
Subsidiaries of the Borrower.
"Termination Date": July 31, 2000.
"Tranche": the collective reference to LIBOR Loans or CD Rate Loans
the then current Interest Periods with respect to all of which begin on
the same date and end on the same later date (whether or not such Loans
shall originally have been made on the same day); Tranches may be
identified as "LIBOR Tranches" or "CD Rate Tranches", as applicable.
"Transferee": as defined in subsection 8.6(f).
"Type": (a) as to any Revolving Credit Loan, its nature as an ABR Loan, a
CD Rate Loan or a LIBOR Loan and (b) as to any Competitive Loan, its nature as a
Fixed Rate Competitive Loan or a LIBOR Competitive Loan.
1.2 Other Definitional Provisions. (a) Unless otherwise specified
therein, all terms defined in this Agreement shall have the defined meanings
when used in the Notes or any certificate or other document made or delivered
pursuant hereto or thereto.
(b) As used herein and in the Notes and any certificate or other
document made or delivered pursuant hereto or thereto, accounting terms relating
to the Borrower and its Subsidiaries not defined in subsection 1.1 and
accounting terms partly defined in subsection 1.1, to the extent not defined,
shall have the respective meanings given to them under GAAP, and the parties
hereto agree that upon any change to GAAP that has the effect of materially
altering any of the terms herein, the parties hereto will negotiate in good
faith to amend the terms affected thereby to place the parties in a position as
nearly equivalent as possible to what existed prior to such change to GAAP.
(c) The words "hereof", "herein" and "hereunder" and words of
similar import when used in this Agreement shall refer to this Agreement as a
whole and not to any particular provision of this Agreement, and Section,
subsection Schedule and Exhibit references are to this Agreement unless
otherwise specified.
11
(d) The meanings given to terms defined herein shall be equally
applicable to both the singular and plural forms of such terms.
SECTION 2. AMOUNT AND TERMS OF THE CREDIT FACILITIES
2.1 The Commitments. (a) Subject to the terms and conditions
hereof, each Lender severally agrees to make revolving credit loans ("Revolving
Credit Loans") to the Borrower from time to time during the Commitment Period in
an aggregate principal amount at any one time outstanding not to exceed the
amount of such Lender's Commitment. During the Commitment Period the Borrower
may use the Commitments by borrowing, prepaying the Revolving Credit Loans in
whole or in part, and reborrowing, all in accordance with the terms and
conditions hereof, Notwithstanding anything to the contrary in this Agreement,
in no event may Revolving Credit Loans be borrowed under this Section 2 if,
after giving effect thereto, the aggregate principal amount of the Loans then
outstanding would exceed the aggregate Commitments then in effect.
(b) The Revolving Credit Loans may from time to time be (i) LIBOR
Loans, (ii) ABR Loans, (iii) CD Rate Loans or (iv) a combination thereof, as
determined by the Borrower and notified to the Agent in accordance with
subsections 2.2 and 2.7, provided that no Revolving Credit Loan shall be made as
a LIBOR Loan or a CD Rate Loan after the day that is one month or 30 days,
respectively, prior to the Termination Date.
2.2 Procedure for Revolving Credit Borrowing. The Borrower may
borrow under the Commitments during the Commitment Period on any Business Day,
provided that the Borrower shall give the Administrative Agent irrevocable
written notice, which notice must be received by the Administrative Agent prior
to (a) 12:00 P.M., New York City time, three Business Days prior to the
requested Borrowing Date, in the case of LIBOR Loans or CD Rate Loans, or (b)
10:30 A.M. New York City time, on the requested Borrowing Date, in the case of
ABR Loans. Each such notice shall specify (i) the amount to be borrowed, (ii)
the requested Borrowing Date, (iii) whether the borrowing is to be of ABR Loans,
CD Rate Loans, LIBOR Loans, or a combination thereof and (iv) if the borrowing
is to be entirely or partly of LIBOR Loans or CD Rate Loans, the respective
lengths of the initial Interest Periods therefor. Each borrowing under the
Commitments shall be in an amount equal to $10,000,000 or a whole multiple of
$1,000,000 in excess thereof. Upon receipt of any such notice from the Borrower,
the Administrative Agent shall promptly notify each Lender thereof. Each Lender
will make the amount of its pro rata share of each borrowing available to the
Administrative Agent for the account of the Borrower at the office of the
Administrative Agent specified in subsection 8.2 prior to 2:00 P.M., New York
City time, on the Borrowing Date requested by the Borrower in funds immediately
available to the Administrative Agent. Such borrowing will then be made
available to the Borrower by the Administrative Agent crediting the account of
the Borrower on the books of such office with the aggregate of the amounts made
available to the Administrative Agent by the Lenders and in like funds as
received by the Administrative Agent.
2.3 Facility Fee. The Borrower agrees to pay to the Administrative
Agent for the account of each Lender a facility fee for the period from and
including the first day of the
12
Commitment Period to the Termination Date, computed at the Facility Fee Rate on
the average daily amount of the Commitment (whether used or unused) of such
Lender during the period for which payment is made, payable quarterly in arrears
on the last day of each March, June, September and December and on the date on
which the Commitments shall terminate as provided herein, commencing on the
first of such dates to occur after the date hereof.
2.4 Termination or Reduction of Commitments. The Borrower may, upon
not less than three Business Days' written notice to the Administrative Agent,
terminate or reduce the unutilized amount of the Commitments. Any reduction of
the Commitments shall be in an amount equal to $10,000,000 or a whole multiple
of $1,000,000 in excess thereof and shall reduce permanently the Commitments
then in effect.
2.5 Repayment of Loans; Evidence of Debt. (a) The Borrower hereby
unconditionally promises to pay to the Administrative Agent for the account of
each Lender the then unpaid principal amount of each Revolving Credit Loan of
such Lender on the Termination Date (or such earlier date on which the Revolving
Credit Loans become due and payable pursuant to Section 6). The Borrower hereby
further agrees to pay interest on the unpaid principal amount of the Loans from
time to time outstanding from the date hereof until payment in full thereof at
the rates per annum, and on the dates, set forth in subsection 2.11.
(b) Each Lender shall maintain in accordance with its usual
practice an account or accounts evidencing indebtedness of the Borrower to such
Lender resulting from each Loan of such Lender from time to time, including the
amounts of principal and interest payable and paid to such Lender from time to
time under this Agreement.
(c) The Administrative Agent shall maintain the Register pursuant
to subsection 8.6(d), and a subaccount therein for each Lender, in which shall
be recorded (i) the amount of each Loan made hereunder, the Type thereof and
each Interest Period applicable thereto, (ii) the amount of any principal or
interest due and payable or to become due and payable from the Borrower to each
Lender hereunder and (iii) both the amount of any sum received by the
Administrative Agent hereunder from the Borrower and each Lender's share
thereof.
(d) The entries made in the Register and the accounts of each
Lender maintained pursuant to subsection 2.5(b) shall, to the extent permitted
by applicable law, be prima facie evidence of the existence and amounts of the
obligations of the Borrower therein recorded: provided, however, that the
failure of any Lender or the Administrative Agent to maintain the Register or
any such account, or any error therein, shall not in any manner affect the
obligation of the Borrower to repay (with applicable interest) the Loans made to
such Borrower by such Lender in accordance with the terms of this Agreement.
(e) The Borrower agrees that, upon the request to the
Administrative Agent by any Lender, the Borrower will execute and deliver to
such Lender a promissory note of the Borrower evidencing the Revolving Credit
Loans of such Lender, substantially in the form of Exhibit A-1 with appropriate
insertions as to date and principal amount (a "Revolving Credit Note").
13
2.6 Optional Prepayments. The Borrower may at any time and from
time to time prepay the Revolving Credit Loans, in whole or in part, without
premium or penalty, upon at least four Business Days' irrevocable notice to the
Administrative Agent. Each such notice shall specify the date and amount of
prepayment and whether the prepayment is of ABR Loans, CD Rate Loans, LIBOR
Loans, or a combination thereof, and, if of a combination thereof, the amount
allocable to each. Upon receipt of any such notice the Administrative Agent
shall promptly notify each Lender thereof. If any such notice is given, the
amount specified in such notice shall be due and payable on the date specified
therein, together with any amounts payable pursuant to subsection 2.18. Partial
prepayments shall be in an aggregate principal amount of $10,000,000 or a whole
multiple of $1,000,000 in excess thereof. Prepayments of the Competitive Loans
shall not be permitted.
2.7 Conversion and Continuation Options. (a) The Borrower may elect
from time to time to convert LIBOR Loans or CD Rate Loans to ABR Loans, by
giving the Administrative Agent at least one Business Day's prior irrevocable
notice of such election, provided that any such conversion of LIBOR Loans or CD
Rate Loans may only be made on the last day of an Interest Period with respect
thereto. The Borrower may elect from time to time to convert ABR Loans or CD
Rate Loans to LIBOR Loans, and/or to convert LIBOR Loans or ABR Loans to CD Rate
Loans, by giving the Administrative Agent at least three Business Days' prior
irrevocable notice of such election, provided that any such conversion of LIBOR
Loans or CD Rate Loans may only be made on the last day of an Interest Period
with respect thereto. Any such notice of conversion to LIBOR Loans or CD Rate
Loans shall specify the length of the initial Interest Period or Interest
Periods therefor. Upon receipt of any such notice the Administrative Agent shall
promptly notify each Lender thereof. All or any part of outstanding LIBOR Loans,
ABR Loans and CD Rate Loans may be converted as provided herein, provided that
(i) no Loan may be converted into a LIBOR Loan or a CD Rate Loan when any Event
of Default has occurred and is continuing and the Administrative Agent has or
the Majority Lenders have determined that such a conversion is not appropriate
and (ii) no Loan may be converted into a LIBOR Loan or a CD Rate Loan after the
date that is one month or 30 days, respectively, prior to the Termination Date.
(b) Any LIBOR Loans or CD Rate Loans may be continued as such upon
the expiration of the then current Interest Period with respect thereto by the
Borrower giving notice to the Administrative Agent, in accordance with the
applicable provisions of the term "Interest Period" set forth in subsection 1.1,
of the length of the next Interest Period to be applicable to such Loans,
provided that no LIBOR Loan or CD Rate Loan may be continued as such (i) when
any Event of Default has occurred and is continuing and the Agent has or the
Majority Lenders have determined that such a continuation is not appropriate or
(ii) after the date that is one month or 30 days prior to, respectively, the
Termination Date and provided, further, that if the Borrower shall fail to give
such notice or if such continuation is not permitted such Loans shall be
automatically converted to ABR Loans on the last day of such then expiring
Interest Period.
2.8 Minimum Amounts and Maximum Number of Tranches. All borrowings,
prepayments, conversions and continuations of Loans hereunder and all selections
of Interest Periods hereunder shall be in such amounts and be made pursuant to
such elections so that, after giving effect thereto, the aggregate principal
amount of the Loans comprising each LIBOR
14
Tranche or each CD Rate Tranche shall be equal to $10,000,000 or a whole
multiple of $1,000,000 in excess thereof. In no event shall there be more than 5
LIBOR Tranches or 5 CD Rate Tranches outstanding at any time.
2.9 The Competitive Loans. Subject to the terms and conditions of
this Agreement, the Borrower may borrow Competitive Loans in Dollars from time
to time on any Business Day during the period from the date hereof through the
date 14 days prior to the Termination Date; provided, that in no event may
Competitive Loans be borrowed hereunder if, after giving effect thereto the
aggregate principal amount of Loans then outstanding would exceed the aggregate
Commitments then in effect. Within the limits and on the conditions herein set
forth with respect to Competitive Loans, the Borrower from time to time may
borrow, repay and reborrow Competitive Loans.
2.10 Procedure for and Payment of Competitive Loan Borrowing. (a)
The Borrower shall request Competitive Loans by delivering a Competitive Loan
Request to the Administrative Agent, not later than 2:00 P.M. (New York City
time) four Business Days prior to the proposed Borrowing Date (in the case of a
LIBOR Competitive Loan Request), and not later than 1:00.P.M. (New York City
time) one Business Day prior to the proposed Borrowing Date (in the case of a
Fixed Rate Competitive Loan Request). Each Competitive Loan Request may solicit
bids for Competitive Loans in an aggregate principal amount of $10,000,000 or an
integral multiple of $1,000,000 in excess thereof and having not more than three
alternative maturity dates. The maturity date for each Fixed Rate Competitive
Loan shall be not less than 14 days nor more than 180 days after the Borrowing
Date therefor and the maturity date for each LIBOR Competitive Loan shall be not
less than one month nor more than six months after the Borrowing Date therefor,
and in any event shall be not later than the Termination Date. The
Administrative Agent shall notify each Competitive Loan Lender promptly by
facsimile transmission of the contents of each Competitive Loan Request received
by the Administrative Agent.
(b) In the case of a LIBOR Competitive Loan Request, upon receipt
of notice from the Administrative Agent of the contents of such Competitive Loan
Request, each Competitive Loan Lender may elect, in its sole discretion, to
offer irrevocably, subject to Section 4, to make one or more Competitive Loans
at LIBOR plus or minus a margin determined by such Competitive Loan Lender in
its sole discretion for each such Competitive Loan. Any such irrevocable offer
shall be made by delivering a Competitive Loan Offer to the Administrative
Agent, before 10:30 A.M. (New York City time) on the day that is three Business
Days before the proposed Borrowing Date, setting forth:
(i) the maximum amount of Competitive Loans for each maturity
date and the aggregate maximum amount of Competitive Loans for all maturity
dates which such Competitive Loan Lender would be willing to make (which
amounts may, subject to subsection 2.9, exceed such Competitive Loan
Lender's Commitment); and
(ii) the margin above or below LIBOR at which such Competitive
Loan Lender is willing to make each such Competitive Loan.
15
The Administrative Agent shall advise the Borrower before 11:00 A.M. (New York
City time) on the date which is three Business Days before the proposed
Borrowing Date of the contents of each such Competitive Loan Offer received by
it. If the Administrative Agent, in its capacity as a Competitive Loan Lender,
shall elect, in its sole discretion, to make any such Competitive Loan Offer, it
shall advise the Borrower of the contents of its Competitive Loan Offer before
10:15 A.M. (New York City time) on the date which is three Business Days before
the proposed Borrowing Date.
(c) In the case of a Fixed Rate Competitive Loan Request upon
receipt of notice from the Administrative Agent of the contents of such
Competitive Loan Request, each Competitive Loan Lender may elect, in its sole
discretion, to offer irrevocably, subject to Section 4, to make one or more
Competitive Loans at a rate of interest determined by such Competitive Loan
Lender in its sole discretion for each such Competitive Loan. Any such
irrevocable offer shall be made by delivering a Competitive Loan Offer to the
Administrative Agent before 9:30 A.M. (New York City time) on the proposed
Borrowing Date, setting forth:
(i) the maximum amount of Competitive Loans for each maturity
date, and the aggregate maximum amount for all maturity dates, which such
Competitive Loan Lender would be willing to make (which amounts may,
subject to subsection 2.9, exceed such Competitive Loan Lender's Revolving
Credit Commitment); and
(ii) the rate of interest at which such Competitive Loan Lender
is willing to make each such Competitive Loan.
The Administrative Agent shall advise the Borrower before 10:00 A.M. (New York
City time) on the proposed Borrowing Date of the contents of each such
Competitive Loan Offer received by it. If the Administrative Agent, in its
capacity as a Competitive Loan Lender, shall elect, in its sole discretion, to
make any such Competitive Loan Offer, it shall advise the Borrower of the
contents of its Competitive Loan Offer before 9:15 A.M. (New York City time) on
the proposed Borrowing Date.
(d) Before 12:00 P.M. (New York City time) three Business Days
before the proposed Borrowing Date (in the case of LIBOR Competitive Loans) and
before 10:30 A.M. (New York City time) on the proposed Borrowing Date (in the
case of Fixed Rate Competitive Loans), the Borrower, in its absolute discretion,
shall:
(i) cancel such Competitive Loan Request by giving the
Administrative Agent telephone notice to that effect, or
(ii) by giving telephone notice to the Administrative Agent
(immediately confirmed by delivery to the Administrative Agent of a
Competitive Loan Confirmation in writing or by facsimile transmission) (1)
subject to the provisions of subsection 2.10(e), accept one or more of the
offers made by any Competitive Loan Lender or Competitive Loan Lenders of
the amount of Competitive Loans for each relevant maturity date and (2)
reject any remaining offers made by Competitive Loan Lenders.
16
(e) The Borrower's acceptance of Competitive Loans in response to
any Competitive Loan Request shall be subject to the following limitations:
(i) The amount of Competitive Loans accepted for each maturity
date specified by any Competitive Loan Lender in its Competitive Loan Offer
shall not exceed the maximum amount for such maturity date specified in
such Competitive Loan Offer;
(ii) the aggregate amount of Competitive Loans accepted for all
maturity dates specified by any Competitive Loan Lender in its Competitive
Loan Offer shall not exceed the aggregate maximum amount specified in such
Competitive Loan Offer for all such maturity dates;
(iii) the Borrower may not accept offers for Competitive Loans
for any maturity date in an aggregate principal amount in excess of the
maximum principal amount requested in the related Competitive Loan Request;
and
(iv) if the Borrower accepts any of such offers, (1) it must
accept such offers based solely upon the lowest pricing for such relevant
maturity date (including any amounts which shall be payable to the relevant
Competitive Loan Lender in respect of the relevant Competitive Loans
pursuant to subsection 2.17) and upon no other criteria whatsoever and (2)
if (x) two or more Competitive Loan Lenders submit offers for any maturity
date at identical pricing and the Borrower accepts any of such offers but
does not wish to (or by reason of the limitations set forth in subsection
2.9 or in this subsection 2.10, cannot) borrow the total amount offered by
such Competitive Loan Lenders with such identical pricing, the Borrower
shall accept offers from all of such Competitive Loan Lenders in amounts
allocated among them pro rata according to the amounts offered by such
Competitive Loan Lenders (or as nearly pro rata as shall be practicable
after giving effect to the requirement that Competitive Loans made by a
Competitive Loan Lender on a Borrowing Date for each relevant maturity date
shall be in a principal amount of $10,000,000 or an integral multiple of
$1,000,000 in excess thereof) or (y) a Competitive Loan Lender submits
offers for multiple maturity dates specifying a maximum aggregate principal
amount for all maturity dates, and the Borrower accepts offers from such
Competitive Loan Lender for more than one maturity date, then the Borrower
shall instruct the Administrative Agent how to apportion the Borrower's
acceptances among such offers for different maturity dates to the extent,
if any, necessary to provide for acceptance of offers from such Competitive
Loan Lender equal to but not exceeding such specified maximum aggregate
amount.
(f) If the Borrower notifies the Administrative Agent that a
Competitive Loan Request is cancelled pursuant to subsection 2.10(d)(i), the
Administrative Agent shall give prompt telephone notice thereof to the
Competitive Loan Lenders.
(g) If the Borrower accepts pursuant to subsection 2.10(d)(ii) one
or more of the offers made by any one or more Competitive Loan Lenders, the
Administrative Agent promptly shall notify each Competitive Loan Lender which
has made such a Competitive Loan Offer of (i) the aggregate amount of such
Competitive Loans to be made on such Borrowing Date for each
17
maturity date, (ii) the acceptance or rejection of any offers to make such
Competitive Loans made by such Competitive Loan Lender and (iii) in the case of
LIBOR Competitive Loans, LIBOR in respect thereof. Before 12:30 P.M. (New York
City time) on the Borrowing Date specified in the applicable Competitive Loan
Request, each Competitive Loan Lender whose Competitive Loan Offer has been
accepted shall make available to the Administrative Agent at its office set
forth in subsection 8.2 the amount of Competitive Loans to be made by such
Competitive Loan Lender, in immediately available funds. The Administrative
Agent will make such funds available to the Borrower as soon as practicable on
such date at the Administrative Agent's aforesaid address. As soon as
practicable after each Borrowing Date, the Administrative Agent shall notify
each Competitive Loan Lender of the aggregate amount of Competitive Loans
advanced on such Borrowing Date, the respective maturity dates thereof and the
respective interest rates applicable thereto.
(h) The Borrower hereby unconditionally promises to pay to the
Administrative Agent for the account of each Competitive Loan Lender the then
unpaid principal amount of each Competitive Loan of such Competitive Loan Lender
on the applicable Competitive Loan Maturity Date. The Borrower hereby further
agrees to pay interest on the unpaid principal amount of the Competitive Loans
from time to time outstanding from the date hereof until payment in full thereof
at the rates per annum, and on the dates, set forth in subsection 2.11. Each
Competitive Loan Lender shall maintain accounts and the Administrative Agent
shall maintain the Register with respect to Competitive Loans as provided in
subsections 2.5(b), (c) and (d).
(i) The Borrower agrees that, upon the request to the
Administrative Agent by any Competitive Loan Lender, the Borrower will execute
and deliver to such Competitive Loan Lender a promissory note of the Borrower
evidencing the Competitive Loans of such Competitive Loan Lender, substantially
in the form of Exhibit A-2 with appropriate insertions as to date and principal
amount (a "Competitive Loan Note").
2.11 Interest Rates and Payment Dates. (a) Each LIBOR Loan shall
bear interest for each day during each Interest Period with respect thereto at a
rate per annum equal to LIBOR determined for such day plus the Applicable
Margin.
(b) Each ABR Loan shall bear interest at a rate per annum equal to
the ABR plus the Applicable Margin.
(c) Each CD Rate Loan shall bear interest for each day during each
Interest Period with respect thereto at a rate per annum equal to the CD Rate
determined for such day plus the Applicable Margin.
(d) Each Competitive Loan shall bear interest for each day from the
applicable Borrowing Date to (but excluding) the applicable Competitive Loan
Maturity Date at the rate of interest specified in the Competitive Loan Offer
accepted by the Borrower in connection with such Competitive Loan.
(e) If all or a portion of (i) the principal amount of any Loan,
(ii) any interest payable thereon or (iii) any fee or other amount payable
hereunder shall not be paid when due
18
(whether at the stated maturity, by acceleration or otherwise), such overdue
amount shall, to the extent permitted by applicable law, bear interest at a rate
per annum which is (x) in the case of overdue principal (except as otherwise
provided in clause (y) below), the rate that would otherwise be applicable
thereto pursuant to the foregoing provisions of this subsection 2.11 plus 2% or
(y) in the case of principal of any Competitive Loan which remains overdue past
the applicable Competitive Loan Maturity Date, or any overdue interest, fee or
other amount, the rate described in subsection 2.11(b) plus 2%, in each case
from the date of such non-payment until such overdue principal, interest, fee or
other amount is paid in full (as well after as before judgment).
(f) lnterest shall accrue from and including the first day of an
Interest Period to but excluding the last day of such Interest Period. Interest
shall be payable in arrears on each Interest Payment Date, provided that
interest accruing pursuant to paragraph (e) of this subsection shall be payable
from time to time on demand.
2.12 Computation of Interest and Fees. (a) Facility fees and,
whenever it is calculated on the basis of the ABR, interest shall be calculated
on the basis of a 365- (or 366-, as the case may be) day year for the actual
days elapsed; and, otherwise, interest shall be calculated on the basis of a
360-day year for the actual days elapsed. The Administrative Agent shall as soon
as practicable notify the Borrower and the Lenders of each determination of
LIBOR or of a CD Rate. Any change in the interest rate on a Loan resulting from
a change in the CD Assessment Rate or the CD Reserve Percentage shall become
effective as of the opening of business on the day on which such change becomes
effective. The Administrative Agent shall as soon as practicable notify the
Borrower and the Lenders of the effective date and the amount of each such
change in interest rate.
(b) Each determination of an interest rate by the Administrative
Agent pursuant to any provision of this Agreement shall be conclusive and
binding on the Borrower and the Lenders in the absence of manifest error. The
Administrative Agent shall, at the request of the Borrower, deliver to the
Borrower upon request a statement showing the quotations used by the
Administrative Agent in determining any interest rate pursuant to subsection 2.1
I(c).
2.13 Inability to Determine Interest Rate. If prior to the first
day of any Interest Period:
(a) the Administrative Agent shall have determined (which
determination shall be conclusive and binding upon the Borrower) that, by
reason of circumstances affecting the relevant market, adequate and
reasonable means do not exist for ascertaining LIBOR or the CD Rate for
such Interest Period, or
(b) the Administrative Agent shall have received notice from the
Majority Lenders that LIBOR or the CD Rate determined or to be determined
for such Interest Period will not adequately and fairly reflect the cost
to such Lenders (as conclusively certified by such Lenders) of making or
maintaining their affected Loans during such Interest Period,
19
the Administrative Agent shall give telecopy or telephonic notice thereof to the
Borrower and the Lenders as soon as practicable thereafter. If such notice is
given (x) any LIBOR Loans, CD Rate Loans or LIBOR Competitive Loans, as the case
may be, requested to be made on the first day of such Interest Period shall be
made as ABR Loans, (y) any Loans that were to have been converted on the first
day of such Interest Period to LIBOR Loans or CD Rate Loans, as the case may be,
shall be converted to or continued as ABR Loans and (z) any outstanding LIBOR
Loans or CD Rate Loans, as the case may be, shall be converted, on the first day
of such Interest Period, to ABR Loans. Until such notice has been withdrawn by
the Administrative Agent, no further LIBOR Loans, CD Rate Loans or LIBOR
Competitive Loans, as the case may be, shall be made or continued as such, nor
shall the Borrower have the right to convert Loans to LIBOR Loans or CD Rate
Loans, as the case may be.
2.14 Pro Rata Treatment and Payments. (a) Each borrowing by the
Borrower from the Lenders of a Revolving Credit Loan, each payment by the
Borrower on account of any facility fee hereunder and any reduction of the
Commitments of the Lenders shall be made pro rata according to the respective
Commitment Percentages of the Lenders. Each payment (including each prepayment)
by the Borrower on account of principal of and interest on the Loans shall be
made pro rata according to the respective outstanding principal amounts of the
Loans for which such payment is being made. All payments (including prepayments)
to be made by the Borrower hereunder, whether on account of principal, interest,
fees or otherwise, shall be made without set off or counterclaim and shall be
made prior to 2:00 P.M., New York City time, on the due date thereof to the
Administrative Agent, for the account of the Lenders, at the Administrative
Agent's office specified in subsection 8.2, in Dollars and in immediately
available funds. The Administrative Agent shall distribute such payments to the
Lenders promptly upon receipt in like funds as received. If any payment
hereunder becomes due and payable on a day other than a Business Day, such
payment shall be extended to the next succeeding Business Day, and, with respect
to payments of principal, interest thereon shall be payable at the then
applicable rate during such extension.
(b) Unless the Administrative Agent shall have been notified in
writing by any Lender prior to a borrowing that such Lender will not make the
amount that would constitute its share of such borrowing available to the
Administrative Agent, the Administrative Agent may assume that such Lender is
making such amount available to the Administrative Agent, and the Administrative
Agent may, in reliance upon such assumption, make available to the Borrower a
corresponding amount. If such amount is not made available to the Administrative
Agent by the required time on the Borrowing Date therefor, such Lender shall pay
to the Administrative Agent, on demand, such amount with interest thereon at a
rate equal to the daily average Federal Funds Effective Rate for the period
until such Lender makes such amount immediately available to the Administrative
Agent. A certificate of the Administrative Agent submitted to any Lender with
respect to any amounts owing under this subsection shall be conclusive in the
absence of manifest error. If such Lender's share of such borrowing is not made
available to the Administrative Agent by such Lender within three Business Days
of such Borrowing Date, the Administrative Agent shall also be entitled to
recover such amount with interest thereon at the rate per annum applicable to
ABR Loans hereunder, on demand, from the Borrower.
20
2.15 Illegality. Notwithstanding any other provision herein, if the
adoption of or any change in any Requirement of Law or in the interpretation or
application thereof shall make it unlawful for any Lender to make or maintain
LIBOR Loans or LIBOR Competitive Loans as contemplated by this Agreement (a)
such Lender shall promptly give notice thereof to the Borrower and the
Administrative Agent, (b) the commitment of such Lender hereunder to make LIBOR
Loans, continue LIBOR Loans as such and convert ABR Loans or CD Rate Loans to
LIBOR Loans shall forthwith be cancelled, (c) such Lender's outstanding LIBOR
Loans, if any, shall be converted automatically to ABR Loans on the respective
last days of the then current Interest Periods with respect to such Loans or
within such earlier period as required by law and (d) the Borrower shall, with
respect to any LIBOR Competitive Loan of such Lender, take such action as such
Lender may reasonably request. If any such conversion of a LIBOR Loan occurs on
a day which is not the last day of the then current Interest Period with respect
thereto, the Borrower shall pay to such Lender such amounts, if any, as may be
required pursuant to subsection 2.18.
2.16 Additional Costs. (a) If, as a result of any Regulatory Change:
(i) the basis of taxation of payments to any Lender of the
principal of or interest on any LIBOR Loans, any CD Rate Loans or LIBOR
Competitive Loans or any other amounts payable under this Agreement in
respect thereof (other than Non-Excluded Taxes covered by subsection 2.17
and taxes imposed on the overall net income of any Lender) is changed;
(ii) any reserve, special deposit, or capital adequacy, or similar
requirements relating to any extensions of credit or other assets of, or
any deposits with or other liabilities of, any Lender are imposed,
modified, or deemed applicable; or
(iii) any other condition affecting this Agreement or any LIBOR
Loans, any CD Rate Loans or LIBOR Competitive Loans is imposed on any
Lender after the date hereof; and
any Lender determines that, by reason thereof, the cost (or in the case of
clause (i) above, the actually incurred cost) to such Lender of making or
maintaining its Commitment or any of its LIBOR Loans, CD Rate Loans or LIBOR
Competitive Rate Loans to the Borrower is increased or any amount receivable by
such Lender hereunder in respect of any of such Loans is reduced, in each case
by an amount reasonably deemed by such Lender to be material (such increases in
cost and reductions in amounts receivable being herein called "Additional
Costs"), then the Borrower shall pay to such Lender upon its request the
additional amount or amounts as will compensate such Lender for such Additional
Costs within 15 Business Days after such written notice is received; provided,
however, that if all or any such Additional Costs would not have been payable
or incurred but for such Lender's voluntary decision to designate a new
Applicable Lending Office, the Borrower shall have no obligation under this
subsection 2.16 to compensate such Lender for such amount relating to such
Lender's decision; provided, further, that the Borrower shall not be required
to make any payments to such Lender for Additional Costs resulting from capital
adequacy requirements unless (A) such Lender has given at least 60 days' prior
written notice of its intent to request such payments and (B) such payments are
with respect
21
to Additional Costs which accrued and were incurred after the expiration of such
60-day notice period. Each Lender will notify the Borrower and the
Administrative Agent of any Regulatory Change occurring after the date of this
Agreement which will entitle such Lender to compensation pursuant to this
subsection 2.16(a) as promptly as practicable after it obtains knowledge thereof
and determines to request such compensation. If such Lender requests
compensation under this subsection 2.16(a) in respect of any Regulatory Change,
the Borrower may, by notice to such Lender, require that such Lender forward to
the Borrower a statement setting forth the basis for requesting such
compensation and the method for determining the amount thereof.
(b) Without limiting the effect of the provisions of subsection
2.16(a) (but without duplication thereof), the Borrower will pay to any Lender,
within 15 Business Days of receipt by the Borrower of notice from such Lender,
for each day such Lender is required to maintain reserves against "Eurocurrency
liabilities" under Regulation D of the Board as in effect on the date of this
Agreement, an additional amount determined by such Lender equal to the product
of the following:
(i) the principal amount of the LIBOR Loan or LIBOR Competitive
Loan, as the case may be;
(ii) the remainder of (x) a fraction the numerator of which is
LlBOR for such LIBOR Loan or LIBOR Competitive Loan, as the case may be,
and the denominator of which is one minus the rate at which such reserve
requirements are imposed on such Lender on such day minus (y) such
numerator; and
(iii) 1/360.
Such Lender shall request payment under this subsection 2.16(b) by giving
notice to the Borrower as of the last day of each Interest Period for each LIBOR
Loan and LIBOR Competitive Loan, as the case may be (and, if such Interest
Period exceeds three months' duration, also as of three months, or a whole
multiple thereof, after the first day of such Interest Period). Such notice
shall specify the basis for requesting such compensation and the method for
determining the amount thereof. Such Lender shall provide any evidence of such
requirement to maintain reserves as the Borrower may reasonably request.
(c) Determinations by any Lender for purposes of this subsection
2.16 of the effect of any Regulatory Change shall be conclusive, provided that
such determinations are made absent manifest error. The agreements in this
subsection shall survive the termination of this Agreement and the payment of
the Loans and all other amounts payable hereunder.
2.17 Taxes. (a) All payments made by the Borrower under this
Agreement and any Notes shall be made free and clear of, and without deduction
or withholding for or on account of, any present or future income, stamp or
other taxes, levies, imposts, duties, charges, fees, deductions or withholdings,
now or hereafter imposed, levied, collected, withheld or assessed by any
Governmental Authority, excluding net income taxes and franchise taxes (imposed
in lieu of net income taxes) imposed on the Administrative Agent, any Lender or
any
22
Applicable Lending Office as a result of a present or former connection between
the Administrative Agent, such Lender or Applicable Lending Office and the
jurisdiction of the Governmental Authority imposing such tax or any political
subdivision or taxing authority thereof or therein (other than any such
connection arising solely from the Administrative Agent or such Lender having
executed, delivered or performed its obligations or received a payment under, or
enforced, this Agreement or any Note). If any such non-excluded taxes, levies,
imposts, duties, charges, fees deductions or withholdings ("Non-Excluded Taxes")
are required to be withheld from any amounts payable to the Administrative Agent
or any Lender hereunder or under any Note, the amounts so payable to the
Administrative Agent or such Lender shall be increased to the extent necessary
so that the amount received by the Administrative Agent or such Lender (after
payment of all Non-Excluded Taxes) shall be equal to the interest or any such
other amounts it would have received had no such withholding been required,
provided, however, that the Borrower shall not be required to increase any such
amounts payable to any Lender that is not organized under the laws of the United
States of America or a state thereof if such Lender fails to comply with the
requirements of paragraph (b) of this subsection. Whenever any Non-Excluded
Taxes are payable by the Borrower, as promptly as practicable thereafter the
Borrower shall send to the Administrative Agent for its own account or for the
account of such Lender, as the case may be, evidence reasonably satisfactory to
the Administrative Agent or such Lender, as the case may be, of such payment. If
the Borrower fails to pay any Non-Excluded Taxes payable by the Borrower when
due to the appropriate taxing authority or fails to remit to the Administrative
Agent the receipts therefor or other required documentary evidence, the Borrower
shall indemnify the Administrative Agent and the Lenders for any incremental
taxes, interest or penalties that may become payable by the Administrative Agent
or any Lender as a result of any such failure. The agreements in this subsection
shall survive the termination of this Agreement and the payment of the Loans and
all other amounts payable hereunder.
(b) Each Lender that is not incorporated under the laws of the
United States of America or a state thereof shall:
(i) deliver to the Borrower and the Administrative Agent (A) two
duly completed copies of United States Internal Revenue Service Form 1001
or 4224, or successor applicable form, as the case may be, and (B) an
Internal Revenue Service Form W-8 or W-9, or successor applicable form, as
the case may be;
(ii) deliver to the Borrower and the Administrative Agent two
further copies of any such form or certification on or before the date that
any such form or certification expires or becomes obsolete and after the
occurrence of any event requiring a change in the most recent form
previously delivered by it to the Borrower; and
(iii) obtain such extensions of time for filing and complete
such forms or certifications as may reasonably be requested by the Borrower
or the Administrative Agent;
unless in any such case an event (including, without limitation, any change in
treaty, law or regulation) has occurred prior to the date on which any such
delivery would otherwise be required which renders all such forms inapplicable
or which would prevent such Lender from
23
duly completing and delivering any such form with respect to it and such Lender
so advises the Borrower and the Administrative Agent. Such Lender shall certify
(i) in the case of a Form 1001 or 4224, that it is entitled to receive payments
under this Agreement without deduction or withholding of any United States
federal income taxes and (ii) in the case of a Form W-8 or W-9, that it is
entitled to an exemption from United States backup withholding tax. Each Person
that shall become a Lender or a Participant pursuant to subsection 8.6 shall, no
later than the effectiveness of the related transfer, be required to provide all
of the forms and statements required pursuant to this subsection, provided that
in the case of a Participant such Participant shall furnish all such required
forms and statements to the Lender from which the related participation shall
have been purchased.
(c) Any Lender claiming any amount pursuant to this subsection 2.17
shall use reasonable efforts (consistent with legal and regulatory restrictions)
to file any certificate or document reasonably requested by the Borrower if such
a filing would avoid the need for or reduce the amount payable by the Borrower
under this subsection 2.17 and would not, in the good faith determination of
such Lender, be otherwise disadvantageous to such Lender.
(d) Refunds. If a Lender or the Administrative Agent (as the case
may be) shall become aware that it is entitled to claim a refund (or a refund in
the form of a credit) (each, a "Refund") from a Governmental Authority (as a
result of any error in the amount of Non-Excluded Taxes paid to such
Governmental Authority) of Non-Excluded Taxes which the Borrower has paid, or
with respect to which the Borrower has paid additional amounts, pursuant to this
subsection 2.17, it shall promptly notify the Borrower of the availability of
such Refund and shall, within 30 days after receipt of written notice by the
Borrower, make a claim to such Governmental Authority for such Refund at the
Borrower's expense if, in the judgment of such Lender or the Administrative
Agent (as the case may be), the making of such claim will not be otherwise
disadvantageous to it; provided that nothing in this subsection 2.17(d) shall be
construed to require any Lender or the Administrative Agent to institute any
administrative proceeding (other than the filing of a claim for any such Refund)
or judicial proceeding to obtain such Refund. If a Lender or the Administrative
Agent (as the case may be) receives a Refund from a Governmental Authority (as a
result of any error in the amount of Non-Excluded Taxes paid to such
Governmental Authority) of any Non-Excluded Taxes which have been paid by the
Borrower, or with respect to which the Borrower has paid additional amounts
pursuant to this subsection 2.17, it shall promptly pay to the Borrower the
amount so received (but only to the extent of payments made, or additional
amounts paid, by the Borrower under this subsection 2.17 with respect to
Non-Excluded Taxes giving rise to such Refund), net of all reasonable
out-of-pocket expenses (including the net amount of taxes, if any, imposed on
such Lender or the Administrative Agent with respect to such Refund) of such
Lender or the Administrative Agent, and without interest (other than interest
paid by the relevant Governmental Authority with respect to such Refund);
provided, however, that the Borrower, upon the request of such Lender or the
Administrative Agent, agrees to repay the amount paid over to the Borrower (plus
penalties, interest or other charges) to such Lender or the Administrative Agent
in the event such Lender or the Administrative Agent is required to repay such
Refund to such Governmental Authority. Nothing contained in this subsection 2.1
7(d) shall require any Lender or the Administrative Agent to make available any
of its tax returns (or any other information that it deems to be confidential or
proprietary).
24
(e) For purposes of this subsection 2.17, the term "Lender"
includes (i) an "Assignee" within the meaning of, and after compliance with the
requirements of, subsection 8.6(c), and (ii) a "Participant" within the meaning
of subsection 8.6(b); provided that such Participant shall have complied with
the requirements of subsection 2.17(c) to the extent applicable and provided,
further, that such Participant shall not be entitled to receive any greater
amount pursuant to this subsection 2.17 than the transferor Lender would have
been entitled to receive had no such transfer occurred.
2.18 Indemnity. The Borrower agrees to indemnify each Lender and to
hold each Lender harmless from any loss or expense which such Lender may sustain
or incur as a consequence of (a) default by the Borrower in making a borrowing
of LIBOR Loans, CD Rate Loans or Competitive Loans, or in the conversion into or
continuation of LIBOR Loans or CD Rate Loans, after the Borrower has given a
notice requesting or accepting the same in accordance with the provisions of
this Agreement, (b) default by the Borrower in making any prepayment after the
Borrower has given a notice thereof in accordance with the provisions of this
Agreement, or (c) the making of a prepayment of LIBOR Loans, CD Rate Loans or
Competitive Loans on a day which is not the last day of an Interest Period or
the applicable Competitive Loan Maturity Date, as the case may be, with respect
thereto. Such indemnification may include an amount equal to the excess, if any,
of (i) the amount of interest which would have accrued on the amount so prepaid,
or not so borrowed, converted or continued, for the period from the date of such
prepayment or of such failure to borrow, convert or continue to the last day of
the relevant Interest Period (or proposed Interest Period) or, in the case of
Competitive Loans, the applicable Competitive Loan Maturity Date (or proposed
Competitive Loan Maturity Date), in each case at the applicable rate of interest
for such Loans provided for herein (excluding, however, the Applicable Margin or
any positive margin applicable to LIBOR Competitive Loans included therein, if
any) over (ii) the amount of interest (as reasonably determined by such Lender)
which would have accrued to such Lender on such amount by placing such amount on
deposit for a comparable period with leading banks in the interbank eurodollar
market. The agreements in this subsection shall survive the termination of this
Agreement and the payment of the Loans and all other amounts payable hereunder.
2.19 Change of Lending Office. Each Lender agrees that if it makes
any demand for payment under subsection 2.16 or 2.17(a), or if any adoption or
change of the type described in subsection 2.15 shall occur with respect to it,
it will use reasonable efforts (consistent with its internal policy and legal
and regulatory restrictions and so long as such efforts would not be
disadvantageous to it, as determined in its sole discretion) to designate a
different Applicable Lending Office if the making of such a designation would
reduce or obviate the need for the Borrower to make payments under subsection
2.16 or 2.17(a), or would eliminate or reduce the effect of any adoption or
change described in subsection 2.15.
2.20 Replacement of Lenders under Certain Circumstances. The
Borrower shall be permitted to replace any Lender which (a) requests
reimbursement for amounts owing pursuant to subsection 2.16 or 2.17 (other than
with respect to LIBOR Competitive Loans), (b) is affected in the manner
described in subsection 2.15 (other than with respect to LIBOR Competitive
Loans) and as a result thereof any of the actions described in said subsection
is required to be taken or (c) defaults in its obligation to make Revolving
Credit Loans hereunder, with a
25
replacement bank or other financial institution; provided that (i) such
replacement does not conflict with any Requirement of Law, (ii) no Event of
Default shall have occurred and be continuing at the time of such replacement,
(iii) the Borrower shall repay (or the replacement bank or institution shall
purchase, at par) all Loans and other amounts owing to such replaced Lender
prior to the date of replacement, (iv) the Borrower shall be liable to such
replaced Lender under subsection 2.18 if any LIBOR Loan owing to such replaced
Lender shall be prepaid (or purchased) other than on the last day of the
Interest Period relating thereto or any Competitive Loan owing to such replaced
Lender shall be paid other than on the relevant Competitive Loan Maturity Date,
(v) the replacement bank or institution, if not already a Lender, shall be
reasonably satisfactory to the Administrative Agent, (vi) the replaced Lender
shall be obligated to make such replacement in accordance with the provisions of
subsection 8.6 (provided that the Borrower shall be obligated to pay the
registration and processing fee referred to therein), (vii) until such time as
such replacement shall be consummated, the Borrower shall pay all additional
amounts (if any) required pursuant to subsection 2.16 or 2.17, as the case may
be, and (viii) any such replacement shall not be deemed to be a waiver of any
rights which the Borrower, the Administrative Agent or any other Lender shall
have against the replaced Lender.
SECTION 3. REPRESENTATIONS AND WARRANTIES
To induce the Administrative Agent and the Lenders to enter into
this Agreement and to make the Loans, the Borrower hereby represents and
warrants to the Administrative Agent and each Lender that:
3.1 Financial Condition. The balance sheets of the Borrower as at
December 31, 1994 and the related statements of income, earnings reinvested in
business, and cash flows for the fiscal year then ended on such date, reported
on by Deloitte & Touche LLP, copies of which have heretofore been furnished to
each Lender, present fairly the financial condition of the Borrower as at such
date, and the results of its operations and its cash flows for the fiscal year
then ended. The unaudited balance sheet of the Borrower as at March 31, 1995 and
the related unaudited statements of income, earnings reinvested in business, and
cash flows for the three-month period ended on such date, certified by a
Responsible Officer, copies of which have heretofore been furnished to each
Lender, are complete and correct and present fairly the financial condition of
the Borrower as at such date, and the results of its operations and its cash
flows for the three-month period then ended (subject to normal year-end audit
adjustments) All such financial statements, including the related schedules and
notes thereto, have been prepared in accordance with GAAP applied consistently
throughout the periods involved (except as approved by such accountants or
Responsible Officer, as the case may be, and as disclosed therein). During the
period from December 31, 1994 to and including the date hereof there has been no
sale, transfer or other disposition by the Borrower of any material part of its
business or property and no purchase or other acquisition of any business or
property (including any capital stock of any other Person) material in relation
to the financial condition of the Borrower at December 31, 1994.
26
3.2 No Change. From December 31, 1994 through the date hereof there
has been no development or event which has had or could reasonably be expected
to have a material adverse effect on the financial position or business
operations of the Borrower.
3.3 Corporate Existence; Compliance with Law. Each of the Borrower
and its Material Subsidiaries, if any, (a) is duly organized, validly existing
and in good standing under the laws of the jurisdiction of its organization, (b)
has the corporate power and authority, and the legal right, to own and operate
its property, to lease the property it operates as lessee and to conduct the
business in which it is currently engaged, (c) is duly qualified as a foreign
corporation and in good standing under the laws of each jurisdiction where its
ownership, lease or operation of property or the conduct of its business
requires such qualification other than in such jurisdictions where the failure
so to qualify would not, individually or in the aggregate, have a material
adverse effect on the financial position or business operations of the Borrower
and (d) is in compliance with all Requirements of Law except to the extent that
the failure to comply therewith could not, in the aggregate, have a material
adverse effect on the financial position or business operations of the Borrower.
3.4 Corporate Power; No Legal Bar. The execution, delivery, and
performance by the Borrower of this Agreement and any Note are within its
corporate powers, have been duly authorized by all necessary corporate action,
and do not violate any provision of law or any agreement, indenture, note, or
other instrument binding upon or affecting it or its charter or by-laws or give
cause for acceleration of any of its Indebtedness.
3.5 Authorization; Enforceability. All authorizations, approvals,
and other actions by, and notices to and filings with all Governmental
Authorities required for the due execution, delivery and performance of this
Agreement and any Note have been obtained or made and are in full force and
effect. Each of this Agreement and each Note executed in connection herewith is
a legal, valid and binding obligation of the Borrower enforceable against the
Borrower in accordance with its terms, subject to the effects of bankruptcy,
insolvency, fraudulent conveyance, reorganization, moratorium or other similar
laws relating to or affecting creditors' rights generally, general equitable
principles (whether considered in a proceeding in equity or at law) and an
implied covenant of good faith and fair dealing.
3.6 ERISA. No "prohibited transaction" (as defined in Section 406
of ERISA or Section 4975 of the Code) or "accumulated funding deficiency" (as
defined in Section 022 of ERISA) or "reportable event" (herein defined as any of
the events set forth in Section 4043(b) of ERlSA or the regulations thereunder)
has occurred since July 1, 1974 with respect to any Plan which would materially
and adversely affect the financial condition of the Borrower. The present value
of all benefits vested under all Plans maintained by the Borrower or any
Commonly Controlled Entity (based on those assumptions used to fund the Plans)
did not, as of the last annual valuation date, exceed the value of the assets of
the Plan allocable to such vested benefits.
3.7 No Material Litigation. As of the date hereof, except as
heretofore disclosed pursuant to Section 13 of the Securities Exchange Act of
1934, as amended, there are no legal or arbitral proceedings or any proceedings
by or before any governmental or regulatory authority or agency, now pending or,
to the knowledge of the Borrower, threatened against the Borrower
27
or any of its Material Subsidiaries, which the Borrower would be required to
disclose pursuant to Section 13 of the Securities Exchange Act of 1934, as
amended.
3.8 Taxes. The Borrower (or Dominion Resources for years in which
the Borrower filed a consolidated return with Dominion Resources) and its
Material Subsidiaries have filed all United States Federal income tax returns
and all other tax returns which are required to be filed by them and have paid
all taxes due pursuant to such returns or pursuant to any assessment received by
the Borrower or any such Material Subsidiary. The charges, accruals and reserves
on the books of the Borrower and such Material Subsidiaries in respect of taxes
and other governmental charges are, in the opinion of the Borrower, adequate.
3.9 Purpose of Loans. The proceeds of the Loans shall be used by
the Borrower for general corporate purposes, including commercial paper back-up,
and no part of the proceeds of any Loans will be used in violation of
Regulations G, U or X of the Board as now and from time to time hereafter in
effect.
SECTION 4. CONDITIONS PRECEDENT
4.1 Conditions to Initial Loans. The effectiveness of this
Agreement is subject to the satisfaction of the following conditions precedent
on or prior to September 1, 1995:
(a) Execution of Agreement. (i) This Agreement shall have been
executed and delivered by a duly authorized officer of each of the
Borrower and the Administrative Agent and (ii) the Administrative Agent
shall have received an executed counterpart hereof (or a copy thereof by
facsimile transmission) from each Lender listed on Schedule I.
(b) Closing Certificate. The Administrative Agent shall have
received a certificate of the Borrower, dated the Closing Date,
substantially in the form of Exhibit C, executed by any Assistant
Treasurer and the Secretary or any Assistant Secretary of the Borrower,
and attaching the documents referred to in subsections 4.1(c), (d) and
(e).
(c) Corporate Proceedings. The Administrative Agent shall have
received a copy of the resolutions, in form and substance satisfactory to
the Administrative Agent, of the Board of Directors of the Borrower (or a
duly authorized committee thereof) authorizing (i) the execution, delivery
and performance of this Agreement and (ii) the borrowings contemplated
hereunder.
(d) Corporate Documents. The Administrative Agent shall have
received a copy of the articles of incorporation and by-laws of the
Borrower.
(e) Regulatory Approvals. The Administrative Agent shall have
received copies of any required orders of the Virginia State Corporation
Commission or any other state utilities commission approving the
Borrower's execution, delivery and performance of this Agreement and the
borrowings hereunder.
28
(f) Legal Opinions. The Administrative Agent shall have received the
following executed legal opinions, with a copy for each Lender:
(i) the executed legal opinion of Hunton & Xxxxxxxx, counsel to
the Borrower, substantially in the form of Exhibit D-l; and
(ii) the executed legal opinion of Xxxxxxx Xxxxxxx & Xxxxxxxx,
special counsel to the Administrative Agent, substantially in the
form of Exhibit D-2.
(g) Representations and Warranties; No Default. Each of the
representations and warranties made by the Borrower in or pursuant to the
Loan Documents shall be true and correct in all material respects on and
as of such date as if made on and as of such date and no Default or Event
of Default shall have occurred and be continuing on such date.
4.2 Conditions to Each Loan. The agreement of each Lender to make
any Loan requested to be made by it on any date (including, without limitation,
its initial Loan) is subject to the satisfaction of the following conditions
precedent:
(a) Representations and Warranties. Each of the representations and
warranties made by the Borrower in or pursuant to the Loan Documents shall
be true and correct in all material respects on and as of such date as if
made on and as of such date.
(b) No Default. No Default or Event of Default shall have occurred
and be continuing on such date or after giving effect to the Loans
requested to be made on such date.
Each borrowing by the Borrower hereunder shall constitute a representation and
warranty by the Borrower as of the date thereof that the conditions contained in
this subsection 4.2 have been satisfied.
SECTION 5. COVENANTS
The Borrower hereby agrees that, so long as the Commitments remain
in effect or any amount is owing to any Lender or the Administrative Agent
hereunder or under any other Loan Document:
5.1 Financial Statements. The Borrower shall furnish to the
Administrative Agent, who shall forward to each Lender:
(a) as soon as practicable, but in any event within 120 days after
the end of each fiscal year of the Borrower, a copy of the consolidated
balance sheet of the Borrower and its consolidated Subsidiaries, if any,
as at the end of such year and the related consolidated statements of
income, earnings reinvested in business, and cash flows for such year,
setting forth in each case in comparative form the figures for the
previous year,
29
reported on, by Deloitte & Touche LLP or other independent certified public
accountants of nationally recognized standing; and
(b) as soon as practicable, but in any event not later than 60 days
after the end of each of the first three quarterly periods of each fiscal
year of the Borrower, the unaudited consolidated balance sheet of the
Borrower and its consolidated Subsidiaries, if any, as at the end of such
quarter and the related unaudited consolidated statements of income,
earnings reinvested in business, and cash flows for such quarter and the
portion of the fiscal year through the end of such quarter, setting forth
in each case in comparative form the figures for the previous year
certified by a Responsible Officer as being fairly stated in all material
respects (subject to normal year-end audit adjustments);
(c) within fourteen days after the same are sent, copies of all
financial statements and reports which the Borrower sends to its
stockholders generally, and within fourteen days after the same are filed,
copies of all financial statements and reports which the Borrower may make
to, or file with, the Securities and Exchange Commission or any successor
or analogous Governmental Authority; and
(d) promptly, such additional financial and other information as the
Administrative Agent, or any Lender through the Administrative Agent, may
from time to time reasonably request.
All such financial statements in (a) and (b) shall be (i) complete
and correct in all material respects, (ii) prepared in reasonable detail and in
accordance with GAAP applied consistently throughout the periods reflected
therein and with prior periods (except as approved by such accountants or
officer, as the case may be, and disclosed therein) and (iii) accompanied by a
compliance certificate signed by a Responsible Officer of the Borrower setting
forth the Consolidated Net Worth of the Borrower as of the date of such
financial statements.
Unless accompanied by a statement of a Responsible Officer setting
forth the details of each Default which has occurred and is continuing and the
steps which the Borrower proposes to take to remedy such Default, each delivery
of financial statements pursuant to clauses (a) and (b) of this subsection 5.1
shall be deemed to constitute a certification by the Borrower that no Default
has occurred and is continuing.
5.2 Conduct of Business and Compliance. The Borrower will continue
to engage in business of the same general type as now conducted by it, and the
Borrower will, and will cause each of its Subsidiaries, if any, to comply with
all Requirements of Law except to the extent that failure to comply therewith
would not materially and adversely affect the ability of the Borrower to perform
its obligations hereunder.
5.3 Books and Records. The Borrower will, and will cause each of
its Material Subsidiaries, if any, to, keep proper books of records and account
in which full, true and correct entries in conformity with GAAP and all
Requirements of Law shall be made of all dealings and transactions in relation
to its business and activities.
30
5.4 Notices. The Borrower shall promptly give notice to the
Administrative Agent, and the Administrative Agent shall in turn give notice to
each Lender, of:
(a) the occurrence of any Default or Event of Default, which such
notice shall state that such notice is a "notice of default";
(b) the existence or imposition of any judgements against the
Borrower or any of its Material Subsidiaries in an amount in excess of
$25,000,000;
(c) the failure of the Borrower or any of its Material Subsidiaries
to pay any principal or interest in an aggregate amount of $25,000,000 or
more on any Indebtedness; and
(d) promptly following the Borrower's receipt, any change in the
Xxxxx'x Bond Rating or the S&P Bond Rating.
Each notice pursuant to clause (a) shall be accompanied by a
statement of a Responsible Officer setting forth details of the occurrence
referred to therein and stating what action the Borrower proposes to take with
respect thereto.
5.5 Limitation on Liens. The Borrower shall not, nor shall it
permit any of its Material Subsidiaries to, create, incur, assume or suffer to
exist any Lien upon any of its property, assets or revenues, whether now owned
or hereafter acquired, except for (i) Liens permitted by the First Mortgage Bond
Indenture and (ii) Liens created in the ordinary course of business.
5.6 Limitation on Fundamental Changes. The Borrower will not enter
into any merger, consolidation or amalgamation, or liquidate, wind up or
dissolve itself (or suffer any liquidation or dissolution), or convey, sell,
lease, assign, transfer or otherwise dispose of, a material part of its
property, business or assets, except the Borrower may be merged or consolidated
with another Person that is a corporation duly organized and existing under the
laws of any state in the United States provided that (i) the survivor shall
continue to use and operate the Borrower's public utility business, (ii) the
survivor shall assume the Borrower's obligations hereunder in accordance with
documentation acceptable to the Administrative Agent and the Majority Lenders
and (iii) after giving effect to such merger or consolidation no Default or
Event of Default shall have occurred or be continuing.
5.7 Limitation on Guarantee Obligations. The Borrower shall not
create, incur, assume or suffer to exist any Guarantee Obligation except for (a)
Guarantee Obligations in existence on the date hereof and listed on Schedule
III; (b) Guarantee Obligations made in the ordinary course of its business by
the Borrower of obligations of any of its Subsidiaries; and (c) Guarantee
Obligations guaranteeing securities issued by a corporation, partnership or
trust formed at the direction of the Borrower, provided that (i) the proceeds
from the issuance of such securities (other than to cover offering expenses)
were used solely by such corporation, partnership or trust to purchase from the
Borrower securities issued by the Borrower and (ii) the
31
Guarantee Obligations exist only so long as and only to the extent that such
corporation, partnership or trust holds such securities issued by the Borrower.
5.8 Maintenance of Net Worth. The Borrower will not permit
Consolidated Net Worth to be less than $3.75 billion.
SECTION 6. EVENTS OF DEFAULT
If any of the following events shall occur and be continuing:
(a) The Borrower shall fail to pay any principal of any Loan when due
in accordance with the terms hereof, or to pay any interest on any Loan, or
any other amount payable hereunder, within 5 Business Days after any such
amount becomes due in accordance with the terms hereof;
(b) Any representation or warranty made to the Administrative Agent
or any Lender in connection with the execution and delivery of this
Agreement or the making of Loans hereunder proves to have been incorrect in
any material respect when made, and the future financial position or
business operations of the Borrower could reasonably be expected to be
materially and adversely affected from what would be the case had such
representation and warranty not been incorrect;
(c) The Borrower shall default in the performance of any other term,
covenant, or provision contained in this Agreement (other than as provided
in paragraphs (a) and (b) of this Section) and such default shall continue
unremedied for 30 days;
(d) The Borrower or any of its Material Subsidiaries shall (i) apply
for or consent to the appointment of, or the taking of possession by, a
receiver, custodian, trustee, or liquidator of itself or of all or a
substantial part of its property, (ii) admit in writing its inability, or
be generally unable, to pay its debts as such debts become due, (iii) make
a general assignment for the benefit of its creditors, (iv) commence a
voluntary case under the federal bankruptcy laws (as now or hereafter in
effect), (v) file a petition seeking to take advantage of any other law
relating to bankruptcy, insolvency, reorganization, winding-up, or
composition or readjustment of debts, (vi) fail to controvert in a timely
and appropriate manner, or acquiesce in writing to, any petition filed
against the Borrower or any of its Material Subsidiaries in an involuntary
case under such federal laws, or (vii) take any corporate action for the
purpose of affecting any of the foregoing;
(e) A case or other proceeding shall be commenced (including
commencement of such case or proceeding by way of service of process on the
Borrower or any of its Material Subsidiaries), in any court of competent
jurisdiction, seeking (i) the liquidation, reorganization, dissolution or
winding-up, or the composition or readjustment of debts of the Borrower or
any of its Material Subsidiaries, (ii) the appointment of a trustee,
receiver, custodian, liquidator, or the like of the Borrower or any of its
Material Subsidiaries or of all or any substantial part of their respective
assets, (iii) similar relief
32
in respect of the Borrower or any of its Material Subsidiaries under any
law relating to bankruptcy, insolvency, reorganization, winding up, or
composition or readjustment of debts, or a warrant of attachment,
execution, or similar process shall be issued against a substantial part of
the property of the Borrower or any of its Material Subsidiaries and such
case, proceeding, warrant, or process shall continue undismissed or
unstayed and in effect for a period of 45 days, or an order, judgment, or
decree approving or ordering any of the foregoing shall be entered in an
involuntary case under such federal bankruptcy laws;
(f) A trustee shall be appointed to administer any Plan under Section
4042 of ERISA, or the PBGC shall institute proceedings to terminate, or to
have a trustee appointed to administer any Plan and such proceedings shall
continue undismissed or unstayed and in effect for a period of 30 days, and
any such event shall result in any liability which is material in relation
to the consolidated financial condition of the Borrower and its
consolidated Subsidiaries, if any;
(g) The Borrower or any of its Material Subsidiaries shall (i)
default in any payment of principal or interest in an aggregate amount of
$25,000,000 or more (or in the payment of any guarantee thereof) beyond
the period of grace, if any, provided in the instrument or agreement
under which such Indebtedness or guarantee thereof was created or (ii)
default beyond any applicable grace period in the observance or
performance of any other agreement or condition relating to any
Indebtedness in an aggregate amount of $25,000,000 or more or any guarantee
thereof or contained in any instrument or agreement evidencing, securing
or relating thereto, or any other event shall occur or condition exist,
the effect of which default or other event or condition is to cause, or to
permit the holder or holders of such Indebtedness to cause, with the
giving of notice if required, such Indebtedness to become due prior to its
stated maturity; provided, however, if such default shall be cured by the
Borrower or any Material Subsidiary or waived by the holders of such
Indebtedness and any acceleration of maturity having resulted from such
default shall be rescinded or annulled, in each case in accordance with
the terms of such agreement or instrument, without (i) any modification of
the terms of such Indebtedness requiring the Borrower or any such
Material Subsidiary to furnish additional or other security therefor,
reducing the average life to maturity thereof or increasing the principal
amount thereof or (ii) any agreement by the Borrower or any such Material
Subsidiary to furnish additional or other security therefor or to issue
in lieu thereof Indebtedness secured by additional or other collateral or
with a shorter average life to maturity or in a greater principal amount,
then any default hereunder by reason thereof shall be deemed likewise to
have been thereupon cured or waived; or
(h) There shall have been entered by a court of competent
jurisdiction within the United States and shall not have been vacated,
discharged or stayed within sixty (60) days from the entry thereof (or such
longer period as may be provided by law) one or more final judgments or
final decrees for payment of money against the Borrower or any of its
Material Subsidiaries involving in the aggregate a liability (to the extent
not paid or covered by insurance) in excess of $25,000,000;
33
then, and in any such event, (A) if such event is an Event of Default specified
in paragraph (d) or (e) of this Section with respect to the Borrower,
automatically the Commitments shall immediately terminate and the Loans
hereunder (with accrued interest thereon) and all other amounts owing under this
Agreement shall immediately become due and payable, and (B) if such event is any
other Event of Default, either or both of the following actions may be taken:
(i) with the consent of the Majority Lenders, the Administrative Agent may, or
upon the request of the Majority Lenders, the Administrative Agent shall, by
notice to the Borrower declare the Commitments to be terminated forthwith,
whereupon the Commitments shall immediately terminate; and (ii) with the consent
of the Majority Lenders, the Administrative Agent may, or upon the request of
the Majority Lenders, the Administrative Agent shall, by notice to the Borrower,
declare the Loans hereunder (with accrued interest thereon) and all other
amounts owing under this Agreement to be due and payable forthwith, whereupon
the same shall immediately become due and payable. Except as expressly provided
above in this Section, presentment, demand, protest and all other notices of any
kind are hereby expressly waived.
SECTION 7. THE ADMINISTRATIVE AGENT
7.1 Appointment. Each Lender hereby irrevocably designates and
appoints the Administrative Agent as the agent of such Lender under this
Agreement and the other Loan Documents, and each such Lender irrevocably
authorizes the Administrative Agent, in such capacity, to take such action on
its behalf under the provisions of this Agreement and the other Loan Documents;
and to exercise such powers and perform such duties as are expressly delegated
to the Administrative Agent by the terms of this Agreement and the other Loan
Documents, together with such other powers as are reasonably incidental thereto.
Notwithstanding any provision to the contrary elsewhere in this Agreement, the
Administrative Agent shall not have any duties or responsibilities, except those
expressly set forth herein, or any fiduciary relationship with any Lender, and
no implied covenants, functions, responsibilities, duties, obligations or
liabilities shall be read into this Agreement or any other Loan Document or
otherwise exist against the Administrative Agent.
7.2 Delegation of Duties. The Administrative Agent may execute any
of its duties under this Agreement and the other Loan Documents by or through
agents or attorneys-in-fact and shall be entitled to advice of counsel
concerning all matters pertaining to such duties. The Administrative Agent shall
not be responsible for the negligence or misconduct of any agents or attorneys
in-fact selected by it with reasonable care.
7.3 Exculpatory Provisions. Neither the Administrative Agent nor
any of its officers, directors, employees, agents, attorneys-in-fact or
Affiliates shall be (i) liable for any action lawfully taken or omitted to be
taken by it or such Person under or in connection with this Agreement or any
other Loan Document (except for its or such Person's own gross negligence or
willful misconduct) or (ii) responsible in any manner to any of the Lenders for
any recitals, statements, representations or warranties made by the Borrower or
any officer thereof contained in this Agreement or any other Loan Document or in
any certificate, report, statement or other document referred to or provided for
in, or received by the Administrative Agent under or in connection with, this
Agreement or any other Loan Document or for the value, validity,
34
effectiveness, genuineness, enforceability or sufficiency of this Agreement or
any other Loan Document or for any failure of the Borrower to perform its
obligations hereunder or thereunder. The Administrative Agent shall not be under
any obligation to any Lender to ascertain or to inquire as to the observance or
performance of any of the agreements contained in, or conditions of, this
Agreement or any other Loan Document, or to inspect the properties, books or
records of the Borrower.
7.4 Reliance by Administrative Agent. The Administrative Agent
shall be entitled to rely, and shall be fully protected in relying, upon any
Note, writing, resolution, notice, consent, certificate, affidavit, letter,
telecopy, telex or teletype message, statement, order or other document or
conversation believed by it to be genuine and correct and to have been signed,
sent or made by the proper Person or Persons and upon advice and statements of
legal counsel (including, without limitation, counsel to the Borrower),
independent accountants and other experts selected by the Administrative Agent.
The Administrative Agent may deem and treat the payee of any Note as the owner
thereof for all purposes unless a written notice of assignment, negotiation or
transfer thereof shall have been filed with the Administrative Agent. The
Administrative Agent shall be fully justified in failing or refusing to take any
action under this Agreement or any other Loan Document unless it shall first
receive such advice or concurrence of the Majority Lenders as it deems
appropriate or it shall first be indemnified to its satisfaction by the Lenders
against any and all liability and expense which may be incurred by it by reason
of taking or continuing to take any such action. The Administrative Agent shall
in all cases be fully protected in acting, or in refraining from acting, under
this Agreement and the other Loan Documents in accordance with a request of the
Majority Lenders, and such request and any action taken or failure to act
pursuant thereto shall be binding upon all the Lenders and all future holders of
the Loans.
7.5 Notice of Default. The Administrative Agent shall not be deemed
to have knowledge or notice of the occurrence of any Default or Event of Default
hereunder unless the Administrative Agent has received notice from a Lender or
the Borrower referring to this Agreement, describing such Default or Event of
Default and stating that such notice is a "notice of default". In the event that
the Administrative Agent receives such a notice, the Administrative Agent shall
give notice thereof to the Lenders. The Administrative Agent shall take such
action with respect to such Default or Event of Default as shall be reasonably
directed by the Majority Lenders; provided that unless and until the
Administrative Agent shall have received such directions, the Administrative
Agent may (but shall not be obligated to) take such action, or refrain from
taking such action, with respect to such Default or Event of Default as it shall
deem advisable in the best interests of the Lenders.
7.6 Non-Reliance on Administrative Agent and Other Lenders. Each
Lender expressly acknowledges that neither the Administrative Agent nor any of
its officers, directors, employees, agents, attorneys-in-fact or Affiliates has
made any representations or warranties to it and that no act by the
Administrative Agent hereafter taken, including any review of the affairs of the
Borrower, shall be deemed to constitute any representation or warranty by the
Administrative Agent to any Lender. Each Lender represents to the Administrative
Agent that it has, independently and without reliance upon the Administrative
Agent or any other Lender, and based on such documents and information as it has
deemed appropriate, made its own
35
appraisal of and investigation into the business, operations, property,
financial and other condition and creditworthiness of the Borrower and made its
own decision to make its Loans hereunder and enter into this Agreement. Each
Lender also represents that it will, independently and without reliance upon the
Administrative Agent or any other Lender, and based on such documents and
information as it shall deem appropriate at the time, continue to make its own
credit analysis, appraisals and decisions in taking or not taking action under
this Agreement and the other Loan Documents, and to make such investigation as
it deems necessary to inform itself as to the business, operations, property,
financial and other condition and creditworthiness of the Borrower. Except for
notices, reports and other documents expressly required to be furnished to the
Lenders by the Administrative Agent hereunder, the Administrative Agent shall
not have any duty or responsibility to provide any Lender with any credit or
other information concerning the business, operations, property, condition
(financial or otherwise), prospects or creditworthiness of the Borrower which
may come into the possession of the Administrative Agent or any of its officers,
directors, employees, agents, attorneys-in-fact or Affiliates.
7.7 Indemnification. The Lenders agree to indemnify the
Administrative Agent in its capacity as such (to the extent not reimbursed by
the Borrower and without limiting the obligation of the Borrower to do so),
ratably according to their respective Commitment Percentages in effect on the
date on which indemnification is sought (or, if indemnification is sought after
the date upon which the Commitments shall have terminated and the Loans shall
have been paid in full, ratably in accordance with their Commitment Percentages
immediately prior to such date), from and against any and all liabilities,
obligations, losses, damages, penalties, actions, judgments, suits, costs,
expenses or disbursements of any kind whatsoever which may at any time
(including, without limitation, at any time following the payment of the Loans)
be imposed on, incurred by or asserted against the Administrative Agent in any
way relating to or arising out of, the Commitments, this Agreement, any of the
other Loan Documents or any documents contemplated by or referred to herein or
therein or the transactions contemplated hereby or thereby or any action taken
or omitted by the Administrative Agent under or in connection with any of the
foregoing; provided that no Lender shall be liable for the payment of any
portion of such liabilities, obligations, losses, damages, penalties, actions,
judgments, suits, costs, expenses or disbursements resulting solely from the
Administrative Agent's gross negligence or willful misconduct. The agreements in
this subsection shall survive the payment of the Loans and all other amounts
payable hereunder.
7.8 Administrative Agent in Its Individual Capacity. The
Administrative Agent and its Affiliates may make loans to, accept deposits from
and generally engage in any kind of business with the Borrower as though the
Administrative Agent were not the Administrative Agent hereunder and under the
other Loan Documents. With respect to the Loans made by it, the Administrative
Agent shall have the same rights and powers under this Agreement and the other
Loan Documents as any Lender and may exercise the same as though it were not the
Administrative Agent, and the terms "Lender" and "Lenders" shall include the
Administrative Agent in its individual capacity.
7.9 Successor Administrative Agent. The Administrative Agent may
resign as Administrative Agent upon 10 days' notice to the Lenders. If the
Administrative Agent shall resign as Administrative gent under this Agreement
and the other Loan Documents, then the
36
Majority Lenders shall appoint from among the Lenders a successor agent for the
Lenders, which successor agent shall be approved by the Borrower, whereupon such
successor agent shall succeed to the rights, powers and duties of the
Administrative Agent, and the term "Administrative Agent" shall mean such
successor agent effective upon such appointment and approval, and the former
Administrative Agent's rights, powers and duties as Administrative Agent shall
be terminated, without any other or further act or deed on the part of such
former Administrative Agent or any of the parties to this Agreement or any
holders of the Loans. After any retiring Administrative Agent's resignation as
Administrative Agent, the provisions of this Section 7 shall inure to its
benefit as to any actions taken or omitted to be taken by it while it was
Administrative Agent under this Agreement and the other Loan Documents,
SECTION 8. MISCELLANEOUS
8.1 Amendments and Waivers. The Majority Lenders may, or, with the
written consent of the Majority Lenders, the Administrative Agent may, from time
to time, enter into with the Borrower written amendments, supplements,
modifications or waivers hereto and to the other Loan Documents provided,
however, that no such waiver and no such amendment, supplement or modification
shall (i) reduce the amount or extend the scheduled date of maturity of any
Loan, or reduce the stated rate of any interest or fee payable hereunder or
extend the scheduled date of any payment thereof or increase the amount or
extend the expiration date of any Lender's Commitment, in each case without the
consent of each Lender affected thereby, or (ii) amend, modify or waive any
provision of this subsection, the provision of Section 8.6(a) requiring the
written consent of each Lender for the assignment or transfer by the Borrower of
its rights and obligations under this Agreement, or reduce the percentage
specified in the definition of Majority Lenders, in each case without the
written consent of all the Lenders, or (iii) amend, modify or waive any
provision of Section 7 without the written consent of the then Administrative
Agent.
8.2 Notices. All notices, requests and demands to or upon the
respective parties hereto to be effective shall be in writing (including by
facsimile transmission) and, unless: otherwise expressly provided herein, shall
be deemed to have been duly given or made (a) in the case of delivery by hand,
when delivered, (b) in the case of delivery by mail, 5 days after being
deposited in the mails, postage prepaid, or (c) in the case of delivery by
facsimile transmission, when sent and receipt has been confirmed, addressed as
follows in the case of the Borrower and the Administrative Agent, and as set
forth in Schedule I in the case of the other parties hereto, or to such other
address as may be hereafter notified by the respective parties hereto:
The Borrower: Treasurer
Virginia Electric and Power Company
000 X. Xxxx Xxxxxx
X.X. Xxx 00000
Xxxxxxxx, XX 00000
Fax: (000) 000-0000
37
The Administrative Agent: Chemical Bank
000 Xxxx Xxxxxx
Xxx Xxxx, Xxx Xxxx 00000
Attention: Xxxxx Xxxxx
Fax: (000) 000-0000
Chemical Bank Agency Services
000 Xxxx 00xx Xxxxxx
Xxx Xxxx, Xxx Xxxx 00000
Attention: Xxxxxxx Xxxx
Fax: (000) 000-0000
provided that any notice, request or demand to or upon the Administrative Agent
or the Lenders pursuant to subsection 2.2, 2.4, 2.6, 2.7, 2.10 or 2.14 shall not
be effective until received.
8.3 No Waiver; Cumulative Remedies. No failure to exercise and no
delay in exercising, on the part of the Administrative Agent or any Lender, any
right, remedy, power or privilege hereunder or under the other Loan Documents
shall operate as a waiver thereof; nor shall any single or partial exercise of
any right, remedy, power or privilege hereunder preclude any other or further
exercise thereof or the exercise of any other right, remedy, power or privilege.
The rights, remedies, powers and privileges herein provided are cumulative and
not exclusive of any rights, remedies, powers and privileges provided by law.
8.4 Survival. All representations and warranties made hereunder, in
the other Loan Documents and in any document, certificate or statement delivered
pursuant hereto or in connection herewith or therewith shall survive the
execution and delivery of this Agreement and the making of the Loans hereunder.
8.5 Payment of Expenses. The Borrower agrees (a) to pay or
reimburse the Administrative Agent for all its reasonable out-of-pocket costs
and expenses incurred in connection with the development, preparation and
execution of, and any amendment, supplement or modification to, this Agreement
and the other Loan Documents including, without limitation, the reasonable fees
and disbursements of counsel to the Administrative Agent, (b) to pay or
reimburse each Lender and the Administrative Agent for all its costs and
expenses incurred in connection with the enforcement or preservation of any
rights under this Agreement or the other Loan Documents including, without
limitation, the fees and disbursements of counsel (and the allocated fees and
expenses of in-house counsel) to each Lender and of counsel to the
Administrative Agent and (c) to pay, indemnify, and hold each Lender and the
Administrative Agent harmless from and against any and all other liabilities,
obligations, losses, damages, penalties, actions, judgments, suits, costs,
expenses or disbursements of any kind or nature whatsoever with respect to the
execution, delivery, enforcement, performance and administration of this
Agreement and the other Loan Documents (all the foregoing in this clause (c),
collectively, the "indemnified liabilities"), provided, that the Borrower shall
have no obligation hereunder to the Administrative Agent or any Lender with
respect to indemnified liabilities arising from the gross negligence or willful
misconduct of the Administrative Agent or any such Lender or the failure of the
Administrative Agent or any such Lender to comply with this
38
Agreement. The agreements in this subsection shall survive repayment of the
Loans and all other amounts payable hereunder.
8.6 Transfer Provisions. (a) Successors and Assigns. This Agreement
shall be binding upon and inure to the benefit of the Borrower, the Lenders, the
Administrative Agent and their respective successors and assigns, except that
the Borrower may not assign or transfer any of its rights or obligations under
this Agreement without the prior written consent of each Lender.
(b) Participations. Any Lender may, in the ordinary course of its
commercial banking business and in accordance with applicable law, at any time
sell to one or more banks or other entities ("Participants") participating
interests in any Loan owing to such Lender, any Commitment of such Lender or any
other interest of such Lender hereunder and under the other Loan Documents. In
the event of any such sale by a Lender of a participating interest to a
Participant, such Lender's obligations under this Agreement to the other parties
to this Agreement shall remain unchanged, such Lender shall remain solely
responsible for the performance thereof, such Lender shall remain the holder of
any such Loan for all purposes under this Agreement and the other Loan
Documents, and the Borrower and the Administrative Agent shall continue to deal
solely and directly with such Lender in connection with such Lender's rights and
obligations under this Agreement and the other Loan Documents.
(c) Assignments. Any Lender may, in the ordinary course of its
commercial banking business and in accordance with applicable law, at any time
and from time to time assign to any Lender or any affiliate thereof or, with the
consent of the Borrower and the Administrative Agent (which in each case shall
not be unreasonably withheld), to an additional bank or financial institution
("an Assignee") all or any part of its rights and obligations under this
Agreement and the other Loan Documents pursuant to an Assignment and Acceptance,
substantially in the form of Exhibit E, executed by such Assignee, such
assigning Lender (and, in the case of an Assignee that is not then a Lender or
an affiliate thereof, by the Borrower and the Administrative Agent) and
delivered to the Administrative Agent for its acceptance and recording in the
Register, provided that, (i) in the case of any such assignment to an additional
bank or financial institution, the sum of the aggregate principal amount of the
Commitment being assigned shall not be less than $10,000,000 (or such lesser
amount as may be agreed to by the Borrower and the Administrative Agent) and
(ii) any such assignment may, but need not, include rights of the assigning
Lender in respect of Competitive Loans. Upon such execution, delivery,
acceptance and recording, from and after the effective date determined pursuant
to such Assignment and Acceptance, (x) the Assignee thereunder shall be a party
hereto and, to the extent provided in such Assignment and Acceptance, have the
rights and obligations of a Lender hereunder with a Commitment as set forth
therein, and (y) the assigning Lender thereunder shall, to the extent provided
in such Assignment and Acceptance, be released from its obligations under this
Agreement (and, in the case of an Assignment and Acceptance covering all or the
remaining portion of an assigning Lender's rights and obligations under this
Agreement, such assigning Lender shall cease to be a party hereto).
(d) The Register. The Administrative Agent, on behalf of the
Borrower, shall maintain at the address of the Administrative Agent referred to
in subsection 8.2 a copy of each Assignment and Acceptance delivered to it and a
register (the "Register") for the recordation of
39
the names and addresses of the Lenders and the Commitment of, and principal
amounts of the Loans owing to, each Lender from time to time. The entries in the
Register shall be conclusive, in the absence of manifest error, and the
Borrower, the Administrative Agent and the Lenders may (and, in the case of any
Loan or other obligation hereunder not evidenced by a Note, shall) treat each
Person whose name is recorded in the Register as the owner of a Loan or other
obligation hereunder as the owner thereof for all purposes of this Agreement and
the other Loan Documents, notwithstanding any notice to the contrary. Any
assignment of any Loan or other obligation hereunder not evidenced by a Note
shall be effective only upon appropriate entries with respect thereto being made
in the Register. The Register shall be available for inspection by the Borrower
or any Lender at any reasonable time and from time to time upon reasonable prior
notice.
(e) Recordation. Upon its receipt of an Assignment and Acceptance
executed by an assigning Lender and an Assignee (and, in the case of an Assignee
that is not then a Lender or an affiliate thereof, by the Borrower and the
Administrative Agent) together with payment by the Assignee or the Assignor (or,
in the event of a replacement of a Lender pursuant to subsection 2.20, the
replacement Lender) to the Administrative Agent of a registration and processing
fee of $1,500, the Administrative Agent shall (i) promptly accept such
Assignment and Acceptance and (ii) on the effective date determined pursuant
thereto record the information contained therein in the Register and give notice
of such acceptance and recordation to the Lenders and the Borrower.
(f) Disclosure. The Borrower authorizes each Lender to disclose to
any Participant or Assignee (each, a "Transferee") and any prospective
Transferee, any and all financial information in such Lender's possession
concerning the Borrower and its Subsidiaries, which has been delivered to such
Lender by or on behalf of the Borrower pursuant to this Agreement or which has
been delivered to such Lender by or on behalf of the Borrower in connection with
such Lender's credit evaluation of the Borrower and its Subsidiaries prior to
becoming a party to this Agreement.
(g) Pledges. For avoidance of doubt, the parties to this Agreement
acknowledge that the provisions of this subsection concerning assignments of
Loans and Notes relate only to absolute assignments and that such provisions do
not prohibit assignments creating security interests, including, without
limitation, any pledge or assignment by a Lender of any Loan or Note to any
Federal Reserve Bank in accordance with applicable law.
8.7 Adjustments. If any Lender (a "benefitted Lender") shall at any
time receive any payment of all or part of its Loans, or interest thereon, or
receive any collateral in respect thereof (whether voluntarily or involuntarily,
by set-off, pursuant to events or proceedings of the nature referred to in
Section 6(d) or (e), or otherwise), in a greater proportion than any such
payment to or collateral received by any other Lender, if any, in respect of
such other Lender's Loans that are then due and payable, or interest thereon,
such benefitted Lender shall purchase for cash from the other Lenders a
participating interest in such portion of each such other Lender's Loans, or
shall provide such other Lenders with the benefits of any such collateral, or
the proceeds thereof, as shall be necessary to cause such benefitted Lender to
share the excess payment or benefits of such collateral or proceeds ratably with
each of the Lenders; provided,
40
however, that if all or any portion of such excess payment or benefits is
thereafter recovered from such benefitted Lender, such purchase shall be
rescinded, and the purchase price and benefits returned, to the extent of such
recovery, but without interest.
8.8 Counterparts. This Agreement may be executed by one or more of
the parties to this Agreement on any number of separate counterparts (including
by facsimile transmission), and all of said counterparts taken together shall be
deemed to constitute one and the same instrument. A set of the copies of this
Agreement signed by all the parties shall be lodged with the Borrower and the
Administrative Agent.
8.9 Severability. Any provision of this Agreement which is
prohibited or unenforceable in any jurisdiction shall, as to such jurisdiction,
be ineffective to the extent of such prohibition or unenforceability without
invalidating the remaining provisions hereof, and any such prohibition or
unenforceability in any jurisdiction shall not invalidate or render
unenforceable such provision in any other jurisdiction.
8.10 Integration. This Agreement and the other Loan Documents
represent the agreement of the Borrower, the Administrative Agent and the
Lenders with respect to the subject matter hereof, and there are no promises,
undertakings, representations or warranties by the Administrative Agent or any
Lender relative to subject matter hereof not expressly set forth or referred to
herein or in the other Loan Documents.
8.11 GOVERNING LAW. THIS AGREEMENT AND THE RIGHTS AND OBLIGATIONS
OF THE PARTIES HEREUNDER SHALL BE GOVERNED BY, AND CONSTRUED AND INTERPRETED IN
ACCORDANCE WITH, THE LAW OF THE STATE OF NEW YORK.
8.12 WAIVERS OF JURY TRIAL. THE BORROWER, THE ADMINISTRATIVE AGENT
AND THE LENDERS HEREBY IRREVOCABLY AND UNCONDITIONALLY WAIVE TRIAL BY JURY IN
ANY LEGAL ACTION OR PROCEEDING RELATING TO THIS AGREEMENT OR ANY OTHER LOAN
DOCUMENT AND FOR ANY COUNTERCLAIM THEREIN. THIS WAIVER SHALL APPLY TO ANY
SUBSEQUENT AMENDMENTS, RENEWALS, SUPPLEMENTS OR MODIFICATIONS TO THIS AGREEMENT
OR ANY OTHER LOAN DOCUMENT.
8.13 Confidentiality. Each Lender agrees to keep confidential any
written or oral information (a) provided to it by or on behalf of the Borrower
pursuant to or in connection with this Agreement or (b) obtained by such Lender
based on a review of the books and records of the Borrower; provided that
nothing herein shall prevent any Lender from disclosing any such information (i)
to its affiliates, the Administrative Agent or any other Lender, (ii) to any
Transferee which agrees to comply with the provisions of this subsection, (iii)
to its employees, directors, agents, attorneys, accountants and other
professional advisors, (iv) upon the request or demand of any Governmental
Authority having jurisdiction over such Lender, (v) in response to
41
any order of any court or other Governmental Authority or as may otherwise be
required pursuant to any Requirement of Law, (vi) which has been publicly
disclosed other than in breach of this Agreement, or (vii) in connection with
the exercise of any remedy hereunder. In the event that a Lender determines to
disclose information pursuant to clause (v) of this subsection 8.13, such Lender
will, to the extent permitted by applicable law, notify the Borrower prior to
disclosing such information.
42
IN WITNESS WHEREOF, the parties hereto have caused this Agreement
to be duly executed and delivered by their proper and duly authorized officers
as of the day and year first above written.
VIRGINIA ELECTRIC AND POWER COMPANY
By: /s/ X. Xxxxxxxx Xxxxx. Jr.
Name: X. Xxxxxxxx Xxxxx, Xx.
Title: Vice President Treasurer and Corporate
Secretary
CHEMICAL BANK,
as Administrative Agent and as a Lender
By: /s/ Xxxx Xxxxxxx
Name: Xxxx Xxxxxxx
Title: Vice President
FIRST UNION NATIONAL BANK OF VIRGINIA,
as a Lender
By: /s/ Xxxxxxx X. Xxxxx
Name: Xxxxxxx X. Xxxxx
Title: Vice President
THE FUJI BANK, LIMITED,
as a Lender
By: /s/ Xxxx X. Xxxxxx
Name: Xxxx X. Xxxxxx
Title: Vice President & Manager
X.X. XXXXXX DELAWARE,
as a Lender
By: /s/ Xxxxxx X. Xxxxxxx
Name: Xxxxxx X. Xxxxxxx
Title: Vice President
43
NATIONS BANK, N.A. (CAROLINAS),
as a Lender
By: /s/ Xxxxxx X. Xxxx
Name: Xxxxxx X. Xxxx
Title: Vice President
ABN AMRO BANK N.V. (NEW YORK
BRANCH), as a Lender
By: /s/ Xxxx X. Xxxxxx
Name: Xxxx X. Xxxxxx
Title: Vice President
By: /s/ Xxxxxx X. Xxxxx
Name: Xxxxxx X. Xxxxx
Title: Vice President
THE FIRST NATIONAL BANK OF CHICAGO,
as a Lender
By: /s/ Xxxx X. Xxxxxxxxx
Name: Xxxx X. Xxxxxxxxx
Title: Senior Managing Director
THE MISTUBISHI BANK, LIMITED,
as a Lender
By: /s/ J. Xxxxx Xxxxxxxx
Name: J. Xxxxx Xxxxxxxx
Title: Senior Vice President and Manager
44
THE SUMITOMO BANK, LIMITED,
as a Lender
By: /s/ X. Xxxxxxx
Name: X. Xxxxxxx
Title: Joint General Manager
TORONTO DOMINION (NEW YORK), INC.,
as a Lender
By: /s/ Xxxxxx X. Xxxxxx
Name: Xxxxxx X. Xxxxxx
Title: Vice President
WACHOVIA BANK OF NORTH CAROLINA,
as a Lender
By: /s/ F. Xxxxxxx Xxxxxx III
Name: F. Xxxxxxx Xxxxxx, III
Title: Corporate Banking Officer
THE BANK OF NEW YORK,
as a Lender
By: /s/ Xxx X. Xxxxxxx
Name: Xxx X. Xxxxxxx
Title: Senior Vice President
CRESTAR BANK,
as a Lender
By: /s/ Xxxxxxxxxxx X. Xxxxxx
Name: Xxxxxxxxxxx X. Xxxxxx
Title: Vice President
SCHEDULE I
ADDRESSES AND COMMITMENTS
Name and Address of Lender Amount of Commitment
CHEMICAL BANK $36,000,000.00
000 Xxxx Xxxxxx
Xxx Xxxx, Xxx Xxxx 00000
Attention: Xxxx Xxxxxxx
Facsimile: (000) 000-0000
FIRST UNION NATIONAL BANK OF VIRGINIA $30,000,000.00
000 Xxxx Xxxx Xxxxxx, 0xx Xxxxx
Xxxxxxxx, XX 00000
Attention: Xxxxxx Xxxx
Facsimile: (000)-000-0000
THE FUJI BANK, LIMITED $28,000,000.00
Xxx Xxxxx Xxxxx Xxxxxx, 00xx Xxxxx
Xxx Xxxx, XX 00000
Attention: Xxxx Xxxxxx
Facsimile: (000)-000-0000
X.X. XXXXXX SERVICES, INC. $28,000,000.00
000 Xxxxxxx-Xxxxxxxxxx Xxxx
Xxxxxx, XX 00000
Attention: Loan Department
Facsimile: (000)-000-0000
NATIONSBANK, N.A. (CAROLINAS) $28,000,000.00
000 Xxxxx Xxxxx, 0xx Xxxxx
Xxxxxxxxx, XX 00000
Attention: Xxxxxx Xxxx
Facsimile: (000)-000-0000
ABN AMRO BANK N.V. $20,000,000.00
000 Xxxx Xxxxxx
Xxx Xxxx, XX 00000
Attention: Xxx Xxxxxxxxxx
Facsimile: (000)-000-0000
THE FIRST NATIONAL BANK OF CHICAGO $20,000,000.00
Xxx Xxxxx Xxxxxxxx Xxxxx
Xxxxxxx, XX 00000
Attention: Xxxxxxx X. Xxxxxxx
Facsimile: (000)-000-0000
THE MISTUBISHI BANK, LIMITED $20,000,000.00
000 Xxxxxxxxx Xxxxxx, Xxxxx 0000
Xxxxxxx, XX 00000
Attention: Xxxxx Xxxxx
Facsimile: (000)-000-0000
THE SUMITOMO BANK, LIMITED $20,000,000.00
000 Xxxx Xxxxxx
Xxx Xxxx, XX 00000
Attention: Xxxxx Oashi
Facsmile: (000)-000-0000
TORONTO DOMINION (NEW YORK), INC. $20,000,000.00
000 Xxxxxx Xxxxxx
Xxxxxxx, XX 00000
Attention: Xxxx Xxxxxxx
Facsimile: (000)-000-0000
WACHOVIA BANK OF NORTH CAROLINA $20,000,000.00
000 Xxxxx Xxxx Xxxxxx
Xxxxxxx Xxxxx, XX 00000
Attention: F. Xxxxxxx Xxxxxx III
Facsimile: (000)-000-0000
THE BANK OF NEW YORK $15,000,000.00
Xxx Xxxx Xxxxxx, 00xx Xxxxx
Xxx Xxxx, XX 00000
Attention: Xxxxxx Xxxxxxxx
Facsimile: (000)-000-0000
CRESTAR BANK $ 15,000,000.00
9l9 Xxxx Xxxx Xxxxxx
Xxxxxxxx, XX 00000
Attention: Xxxxxxxxxxx Xxxxxx
Facsimile: (000)-000-0000
SCHEDULE II
FACILITY FEE/APPLICABLE MARGIN
Level I Xxxxx 0 Xxxxx 0 Xxxxx 0 Xxxxx 0
Xxxxxx Secured A/A2 or BBB or BBB-/Baa2
Ratings S&P/Moody's higher A-/A3 BBB+/Baal or Baa3 BBB-/Baa3 or Lower
Facility Fee Rate*
Applicable Margins*
LIBOR
CD Rate
ABR
* In the event such ratings fall within different Levels, the foregoing will
be based on the Level with the highest rating (i.e., the lower Level number),
except that in the event that the lower of such ratings is more than one
Level below the higher of such ratings, the Facility Fee Rate and the
Applicable Margin will be determined based on the Level one Level above the
lower of such ratings. In the event that there is no Moody's Bond Rating or
S&P Bond Rating available (other than due to both Xxxxx'x Investor Services,
Inc. and Standard & Poor's Ratings Group ceasing to be engaged in the
business of rating corporate debt securities), then the Facility Fee Rate
and the Applicable Margin will be determined based on Level 5. In the event
that both Xxxxx'x Investor Services, Inc. and Standard & Poor's Ratings
Group cease to be engaged in the business of rating corporate debt
securities, the parties hereto agree to negotiate in good faith to establish
on an equitable basis new Facility Fee Rates and Applicable Margins.
SCHEDULE III
PERMITTED GUARANTEE OBLIGATIONS
1. Guarantee Agreement between Virginia Electric and Power Company and Chemical
Bank dated August 31, 1995
