CONFORMED COPY
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CREDIT AGREEMENT
Dated as of June 12, 1997,
as amended and restated as of June 27, 1997
among
PACIFICORP HOLDINGS, INC.,
THE LENDERS NAMED HEREIN,
CITIBANK, N.A.,
as Paying Agent and Issuing Bank
and
CITICORP USA, INC.,
as Collateral Agent
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CITICORP SECURITIES, INC.,
XXXXXXX XXXXX CREDIT PARTNERS, L.P.
and
X.X. XXXXXX SECURITIES INC.,
as Arrangers
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TABLE OF CONTENTS
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ARTICLE I
Definitions
SECTION 1.01. Defined Terms............................................... 2
SECTION 1.02. Terms Generally............................................. 22
ARTICLE II
The Credits
SECTION 2.01. Commitments................................................. 22
SECTION 2.02. Loans....................................................... 23
SECTION 2.03. Borrowing Procedure......................................... 24
SECTION 2.04. Evidence of Debt; Repayment of Loans........................ 25
SECTION 2.05. Fees........................................................ 25
SECTION 2.06. Interest on Loans........................................... 26
SECTION 2.07. Default Interest............................................ 26
SECTION 2.08. Alternate Rate of Interest.................................. 27
SECTION 2.09. Termination and Reduction of Commitments.................... 27
SECTION 2.10. Conversion and Continuation of Borrowings................... 27
SECTION 2.11. Repayment of Term Borrowings................................ 29
SECTION 2.12. Optional Prepayments........................................ 29
SECTION 2.13. Mandatory Prepayments....................................... 29
SECTION 2.14. Reserve Requirements; Change in Circumstances............... 31
SECTION 2.15. Change in Legality.......................................... 32
SECTION 2.16. Indemnity................................................... 32
SECTION 2.17. Pro Rata Treatment.......................................... 33
SECTION 2.18. Sharing of Setoffs.......................................... 33
SECTION 2.19. Payments.................................................... 34
SECTION 2.20. Taxes....................................................... 34
SECTION 2.21. Assignment of Commitments Under Certain Circumstances;
Duty to Mitigate...................................... 36
SECTION 2.22. Letters of Credit........................................... 37
ARTICLE III
Representations and Warranties
SECTION 3.01. Organization................................................ 41
SECTION 3.02. Corporate and Governmental Authorization; No Contravention.. 41
Contents, p. 2
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SECTION 3.03. Enforceability.............................................. 41
SECTION 3.04. Financial Statements........................................ 41
SECTION 3.05. No Material Adverse Change.................................. 42
SECTION 3.06. Restricted Subsidiaries..................................... 42
SECTION 3.07. Litigation; Compliance with Laws............................ 42
SECTION 3.08. Agreements.................................................. 43
SECTION 3.09. Federal Reserve Regulations................................. 43
SECTION 3.10. Investment Company Act; Public Utility Holding Company Act.. 43
SECTION 3.11. Use of Proceeds............................................. 43
SECTION 3.12. Tax Returns................................................. 43
SECTION 3.13. No Material Misstatements................................... 43
SECTION 3.14. Employee Benefit Plans...................................... 44
SECTION 3.15. Environmental Matters....................................... 44
SECTION 3.16. Pledge Agreement............................................ 45
ARTICLE IV
Conditions
SECTION 4.01. Effective Date.............................................. 45
SECTION 4.02. Borrowings.................................................. 46
ARTICLE V
Affirmative Covenants
SECTION 5.01. Existence; Businesses and Properties........................ 47
SECTION 5.02. Insurance................................................... 48
SECTION 5.03. Obligations and Taxes....................................... 48
SECTION 5.04. Financial Statements, Reports, etc.......................... 48
SECTION 5.05. Litigation and Other Notices................................ 49
SECTION 5.06. Maintaining Records; Access to Properties and Inspections... 50
SECTION 5.07. Use of Proceeds............................................. 50
SECTION 5.08. Compliance with Laws........................................ 50
SECTION 5.09. Further Assurances.......................................... 50
SECTION 5.10. Repayment of Existing Indebtedness.......................... 50
SECTION 5.11. Open Market Shares.......................................... 50
SECTION 5.12. PPM Contribution............................................ 50
Contents, p. 3
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ARTICLE VI
Negative Covenants
SECTION 6.01. Indebtedness................................................ 51
SECTION 6.02. Liens....................................................... 52
SECTION 6.03. Sale and Lease-Back Transactions............................ 54
SECTION 6.04. Investments, Loans and Advances............................. 54
SECTION 6.05. Mergers, Consolidations, Sales of Assets, Equity Issuances
and Acquisitions.......................................... 55
SECTION 6.06. Dividends and Distributions; Restrictions on Ability of
Restricted Subsidiaries to Pay Dividends.................. 56
SECTION 6.07. Transactions with Affiliates................................ 57
SECTION 6.08. Business of Borrower and Restricted Subsidiaries............ 57
SECTION 6.09. Other Agreements............................................ 57
SECTION 6.10. Interest Coverage........................................... 58
SECTION 6.11. PTI Total Debt/Total Capitalization......................... 58
SECTION 6.12. PTI Consolidated EBITDA..................................... 58
ARTICLE VII
Events of Default
ARTICLE VIII
The Paying Agent and the Collateral Agent
ARTICLE IX
Miscellaneous
SECTION 9.01. Notices..................................................... 63
SECTION 9.02. Survival of Agreement....................................... 63
SECTION 9.03. Binding Effect.............................................. 64
SECTION 9.04. Successors and Assigns...................................... 64
SECTION 9.05. Expenses; Indemnity......................................... 66
SECTION 9.06. Right of Setoff............................................. 67
SECTION 9.07. APPLICABLE LAW.............................................. 68
SECTION 9.08. Waivers; Amendment.......................................... 68
SECTION 9.09. Interest Rate Limitation.................................... 68
SECTION 9.10. Entire Agreement............................................ 69
SECTION 9.11. WAIVER OF JURY TRIAL........................................ 69
Contents, p. 4
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SECTION 9.12. Severability................................................ 69
SECTION 9.13. Counterparts................................................ 69
SECTION 9.14. Headings.................................................... 70
SECTION 9.15. Jurisdiction; Consent to Service of Process................. 70
SECTION 9.16. Confidentiality............................................. 70
SECTION 9.17. Margin Regulations.......................................... 71
Exhibits and Schedules
EXHIBIT A Administrative Questionnaire
EXHIBIT B Assignment and Acceptance
EXHIBIT C Borrowing Request
EXHIBIT D Pledge Agreement
EXHIBIT E-1 Opinion of Stoel Rives LLP
EXHIBIT E-2 Opinion of Xxxxx Xxxx & Xxxxxxxx
SCHEDULE 1.01(a) Excluded Assets
SCHEDULE 1.01(b) Existing Indebtedness
SCHEDULE 1.01(c) PTI Asset Sales
SCHEDULE 1.01(d) Refinanced Indebtedness
SCHEDULE 1.01(e) Restricted Subsidiaries
SCHEDULE 2.01 Commitments
SCHEDULE 3.07 Litigation
SCHEDULE 3.15 Environmental Matters
SCHEDULE 6.04(b) Commitments for Investments, Loans and Advances of
the Borrower and the Restricted Subsidiaries
SCHEDULE 6.04(h) PTI Acquisitions
CREDIT AGREEMENT dated as of June 12, 1997,
as amended and restated as of June 27, 1997, among
PACIFICORP HOLDINGS, INC., a Delaware corporation
(the "Borrower"), the Lenders (as defined in Article
I), CITIBANK, N.A., a national banking association
("Citibank"), as paying agent (in such capacity, the
"Paying Agent") for the Lenders, and as issuing bank
(in such capacity, the "Issuing Bank"), and CITICORP
USA, INC., a Delaware corporation ("Citicorp USA"),
as collateral agent (in such capacity, the
"Collateral Agent") for the Lenders.
The parties hereto are parties to a Credit Agreement dated as of June
12, 1997 (the "Original Credit Agreement").
Pursuant to the Offer (such term and each other capitalized term used
but not defined herein having the meaning given it in Article I), Bidco has
offered or will offer to purchase each outstanding Share (including Shares
represented by Depositary Shares) at a purchase price of 695.5 xxxxx net per
share in cash to the holder thereof (which includes a net dividend of 5.5 xxxxx
per share to be paid by the Target on July 4, 1997). In connection therewith and
to provide a portion of the financing therefor, (a) Bidco has entered into the
Bidco Facility Agreement, (b) Energyco has entered into the Energyco Bridge Loan
Agreement and (c) Powercoal has entered into the Powercoal Credit Agreement.
The Borrower has requested the Lenders to extend credit in the form of
(a) Term Loans on a single date at any time during the Term Loan Availability
Period in an aggregate principal amount not in excess of $1,200,000,000, and (b)
Revolving Loans at any time and from time to time prior to the Maturity Date, in
an aggregate principal amount at any time outstanding not in excess of
$85,000,000. The Borrower has requested the Issuing Bank to issue letters of
credit, in an aggregate face amount at any time outstanding not in excess of
$85,000,000, to support payment obligations incurred in the ordinary course of
business, or to support investments made, directly or indirectly, by the
Borrower, the Restricted Subsidiaries and PFS and its subsidiaries.
The proceeds of the Term Loans are to be used solely (a) to refinance
the principal of, and to pay all interest, fees and other amounts payable in
respect of, the Refinanced Indebtedness, (b) to distribute to Bidco through
certain of the Borrower's direct and indirect subsidiaries a portion of the
funds necessary to finance the Offer, (c) for the payment of fees and expenses
in connection with the Offer and (d) for general corporate purposes of the
Borrower and the Restricted Subsidiaries. The proceeds of the Revolving Loans
are to be used solely (a) for the ordinary working capital needs of the Borrower
and the Restricted Subsidiaries and (b) to finance loans to PFS and its
subsidiaries to be used by PFS and its subsidiaries for their ordinary working
capital needs. Bidco will use (a) the proceeds from each Acquisition Borrowing,
(b) the proceeds of the Powercoal/Bidco Loans, (c) certain proceeds from
borrowings by Bidco under the Bidco Facility Agreement and (d) certain proceeds
that Energyco will indirectly distribute to Bidco from borrowings by Energyco
under the Energyco Bridge Loan Agreement to (i) finance the Offer and for the
purposes specified in Clause 3.1(a)(i) of the Bidco Facility Agreement, as in
effect on the Restatement Date, and (ii) refinance certain existing Indebtedness
of the Target and its subsidiaries.
The Borrower has requested that the Original Credit Agreement be
amended and restated in the form hereof. The Lenders and the Issuing Bank are
willing so to amend and restate the Original
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Credit Agreement and to extend such credit to the Borrower, on the terms and
subject to the conditions set forth herein. Accordingly, the parties hereto
agree as follows:
ARTICLE I
Definitions
SECTION 1.01. Defined Terms. As used in this Agreement, the following
terms shall have the meanings specified below:
"Acquisition Borrowing" shall mean any Borrowing, the proceeds of which
are distributed to Bidco through certain of the Borrower's direct and indirect
subsidiaries to be used by Bidco to finance a portion of the Offer.
"Adjusted LIBO Rate" shall mean, with respect to any Eurodollar
Borrowing for any Interest Period, an interest rate per annum (rounded upwards,
if necessary, to the next 1/16 of 1%) equal to the product of (a) the LIBO Rate
in effect for such Interest Period and (b) Statutory Reserves.
"Administrative Questionnaire" shall mean an Administrative
Questionnaire in the form of Exhibit A or such other form as shall be approved
by the Paying Agent.
"Affiliate" shall mean, when used with respect to a specified person,
any other person that directly or indirectly, through one or more
intermediaries, Controls or is Controlled by or is under direct or indirect
common Control with such specified person; provided that, for purposes of
Section 6.07 only, beneficial ownership of 10% or more of the voting securities
of a person shall be deemed to be Control for purposes of the definition of
"Affiliate". Neither the Lenders nor any of their Affiliates will be treated as
an Affiliate of the Borrower or any of its subsidiaries for purposes of this
Agreement.
"Aggregate Revolving Credit Exposure" shall mean the aggregate amount
of the Lenders' Revolving Credit Exposures.
"Assessment Rate" shall mean for any date the annual rate (rounded
upwards, if necessary, to the next 1/100 of 1%) most recently estimated by the
Paying Agent as the then current net annual assessment rate that will be
employed in determining amounts payable by the Paying Agent to the Federal
Deposit Insurance Corporation (or any successor thereto) for insurance by such
Corporation (or such successor) of time deposits made in dollars at the Paying
Agent's domestic offices.
"Asset Sale" shall mean (a) the sale, lease, transfer or other
disposition (by way of merger or otherwise, including as a result of a
Condemnation Event or a Casualty Event) by the Borrower or any of the Restricted
Subsidiaries (other than PTI or any of its subsidiaries) to any person other
than the Borrower or any wholly owned Restricted Subsidiary of (i) any capital
stock of any of the Restricted Subsidiaries or Newco or (ii) any other assets of
the Borrower or any of the Restricted Subsidiaries (other than inventory,
obsolete or worn-out assets, scrap and Permitted Investments, in each case
disposed of in the ordinary course of business), except for any sale, lease,
transfer or other disposition in one transaction or a series of related
transactions having a value of $25,000,000 or less or (b) any
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payment in respect of the PFSAC Obligation. Notwithstanding the foregoing, the
term "Asset Sale" shall not include (a) the PPM Contribution, the TPC
Contribution, the PFS Pre-Funding Sale or the Powercor Contribution, (b) the
transfer of Open Market Shares in accordance with Section 5.11, (c) transfers of
assets that result in an investment permitted by Section 6.04(c) or (e), (d)
transfers of assets as part of a sale and lease-back transaction permitted by
Section 6.03, (e) the payment of a cash dividend permitted by Section 6.06(a),
and (f) the transfer to a subsidiary of PacifiCorp of any of the Excluded
Assets.
"Assignment and Acceptance" shall mean an assignment and acceptance
entered into by a Lender and an assignee, and accepted by the Paying Agent, in
the form of Exhibit B or such other form as shall be approved by the Paying
Agent.
"Base Rate" shall mean, for any day, a rate per annum (rounded upwards,
if necessary, to the next 1/16 of 1%) equal to the greatest of (a) the Prime
Rate in effect on such day, (b) the Base CD Rate in effect on such day plus 1%
and (c) the Federal Funds Effective Rate in effect on such day plus 1/2 of 1%.
If for any reason the Paying Agent shall have determined (which determination
shall be conclusive absent manifest error) that it is unable to ascertain the
Base CD Rate or the Federal Funds Effective Rate or both for any reason,
including the inability or failure of the Paying Agent to obtain sufficient
quotations in accordance with the terms of the definition thereof, the Base Rate
shall be determined without regard to clause (b) or (c), or both, of the
preceding sentence, as appropriate, until the circumstances giving rise to such
inability no longer exist. Any change in the Base Rate due to a change in the
Prime Rate, the Base CD Rate or the Federal Funds Effective Rate shall be
effective on the effective date of such change in the Prime Rate, the Base CD
Rate or the Federal Funds Effective Rate, respectively. The term "Prime Rate"
shall mean the rate of interest per annum publicly announced from time to time
by the Paying Agent as its prime rate in effect at its principal office in New
York City; each change in the Prime Rate shall be effective on the date such
change is publicly announced as being effective. The term "Base CD Rate" shall
mean the sum of (a) the product of (i) the Three-Month Secondary CD Rate and
(ii) Statutory Reserves and (b) the Assessment Rate. The term "Federal Funds
Effective Rate" shall mean, 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 that is a Business Day, the average of the quotations for
the day for such transactions received by the Paying Agent from three Federal
funds brokers of recognized standing selected by it.
"Base Rate Borrowing" shall mean a Borrowing comprised of Base Rate
Loans.
"Base Rate Loan" shall mean any Base Rate Term Loan or Base Rate
Revolving Loan.
"Base Rate Revolving Loan" shall mean any Revolving Loan bearing
interest at a rate determined by reference to the Base Rate in accordance with
the provisions of Article II.
"Base Rate Term Borrowing" shall mean a Borrowing comprised of Base
Rate Term Loans.
"Base Rate Term Loan" shall mean any Term Loan bearing interest at a
rate determined by reference to the Base Rate in accordance with the provisions
of Article II.
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"Bidco" shall mean PacifiCorp Acquisitions, an unlimited company
incorporated in England and Wales, all the outstanding share capital of which on
the Restatement Date is beneficially owned by FinanceCo.
"Bidco Agent" shall mean Citibank International plc, in its capacity as
facility agent for the Bidco Lenders under the Bidco Facility Agreement, and any
successor or assign in such capacity.
"Bidco Facility Agreement" shall mean the facility agreement dated June
13, 1997, among Bidco, Recco, FinanceCo, the Bidco Lenders, the Bidco Agent and
the Arrangers, the Security Agent and the LC Bank named therein.
"Bidco Lenders" shall mean the financial institutions that are parties
from time to time to the Bidco Facility Agreement as lenders thereunder.
"Board" shall mean the Board of Governors of the Federal Reserve System
of the United States of America.
"Borrowing" shall mean a group of Loans of a single Type made by the
Lenders on a single date and as to which a single Interest Period is in effect.
"Borrowing Request" shall mean a request by the Borrower in accordance
with the terms of Section 2.03 and substantially in the form of Exhibit C or
such other form as shall be approved by the Paying Agent.
"Business Day" shall mean any day other than a Saturday, Sunday or day
on which banks in New York City are authorized or required by law to close;
provided, however, that when used in connection with a Eurodollar Loan, the term
"Business Day" shall also exclude any day on which banks are not open for
dealings in dollar deposits in the London interbank market.
"Capital Lease Obligations" of any person shall mean the obligations of
such person to pay rent or other amounts under any lease of (or other
arrangement conveying the right to use) real or personal property, or a
combination thereof, which obligations are required to be classified and
accounted for as capital leases on a balance sheet of such person under GAAP,
and the amount of such obligations shall be the capitalized amount thereof
determined in accordance with GAAP.
"Cash Income Available for Interest" shall mean, for any period, the
sum of (a) the aggregate amount of cash dividends actually received by the
Borrower during such period with respect to common stock of its subsidiaries;
(b) the aggregate amount of payments actually received by the Borrower during
such period with respect to the Borrower's interest in the Spring Creek
Obligations, net of income taxes applicable thereto calculated at the Net
Effective Tax Rate for such period; (c) the aggregate amount of any interest
payments actually received by the Borrower during such period with respect to
Indebtedness due to the Borrower under the Intercompany Loan Agreements and with
respect to any other intercompany loans or advances, net of income taxes
applicable thereto calculated at the Net Effective Tax Rate for such period; and
(d) the aggregate amount of cash equity investments made by PacifiCorp in the
Borrower during such period. For purposes of clause (d) of this definition, a
cash equity investment made by PacifiCorp in the Borrower within 30 days of the
end of any fiscal quarter shall be deemed to have been made during such fiscal
quarter (and not during the following
5
fiscal quarter) if the Borrower so elects by giving written notice of such
election to the Paying Agent within such 30-day period.
"Casualty Event" shall mean an event pursuant to which the Borrower or
any of the Restricted Subsidiaries has the right to collect insurance proceeds
under any insurance policies with respect to any insured casualty or other
insured damage to any property of the Borrower or any of the Restricted
Subsidiaries.
A "Change in Control" shall be deemed to have occurred if (a) any
person or group (within the meaning of Rule 13d-5 of the Securities Exchange Act
of 1934 as in effect on the Closing Date) shall own directly or indirectly,
beneficially or of record, shares representing more than 35% of the aggregate
ordinary voting power represented by the issued and outstanding capital stock of
PacifiCorp; (b) a majority of the seats (other than vacant seats) on the board
of directors of PacifiCorp shall at any time be occupied by persons who were
neither (i) nominated by the board of directors of PacifiCorp, nor (ii)
appointed by directors so nominated; (c) any change in control (or similar
event, however denominated) with respect to PacifiCorp shall occur under and as
defined in any indenture or agreement in respect of Indebtedness to which the
Borrower, any person directly or indirectly Controlling the Borrower or any
subsidiary of the Borrower is a party; (d) PacifiCorp consolidates with, or
merges with or into, any person, or any person consolidates with, or merges with
or into, PacifiCorp in any such event pursuant to a transaction in which any of
the issued and outstanding capital stock of PacifiCorp is converted into or
exchanged for cash, securities or other property, other than any such
transaction where the capital stock of PacifiCorp outstanding immediately prior
to such transaction is converted into or exchanged for capital stock of the
surviving or transferee person constituting a majority of the issued and
outstanding shares of such capital stock of such surviving or transferee person
(immediately after giving effect to such conversion or exchange); (e) PacifiCorp
shall own, directly or indirectly, beneficially and of record, less than 80% of
the outstanding capital stock of the Borrower; or (f) the Borrower shall own,
directly or indirectly, beneficially and of record, less than 80% of the
outstanding capital stock of Newco, free and clear of all Liens, other than
Liens created by the Pledge Agreement.
"Citibank" shall have the meaning assigned to such term in the preamble
to this Agreement.
"Citicorp USA" shall have the meaning assigned to such term in the
preamble to this Agreement.
"Closing Date" shall mean June 12, 1997.
"Code" shall mean the Internal Revenue Code of 1986, as amended from
time to time.
"Collateral" shall mean all the "Collateral", as defined in the Pledge
Agreement.
"Commitment" shall mean, with respect to any Lender, such Lender's
Revolving Credit Commitment and Term Loan Commitment.
"Commitment Fee" shall have the meaning assigned to such term in
Section 2.05(a).
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"Condemnation Event" shall mean an event pursuant to which the Borrower
or any of the Restricted Subsidiaries has the right to collect and receive
proceeds as a result of any action or proceeding for the taking of any property
of the Borrower or any Restricted Subsidiary, or any part thereof or interest
therein, for public or quasi-public use under the power of eminent domain, by
reason of any public improvement or condemnation proceeding, or in any other
manner.
"Confidential Information Memorandum" shall mean the Confidential
Information Memorandum of the Borrower to be used by the Initial Lenders and
their Affiliates in connection with the syndication of the Commitments following
the Closing Date.
"Consolidated EBITDA" shall mean, for any period, Consolidated Net
Income for such period, plus, without duplication and to the extent deducted
from revenues in determining Consolidated Net Income, the sum of (a) the
aggregate amount of Consolidated Interest Expense for such period, (b) the
aggregate amount of income tax expense for such period (including payments in
respect of income taxes under the Tax Sharing Arrangement), (c) all amounts
attributable to depreciation, depletion and amortization for such period and (d)
all noncash nonrecurring charges during such period, and minus, without
duplication, all nonrecurring gains during such period, all as determined on a
consolidated basis with respect to PTI and its subsidiaries in accordance with
GAAP.
"Consolidated Interest Expense" shall mean, for any period, the gross
interest expense, whether expensed or capitalized (including the interest
component in respect of Capital Lease Obligations), accrued or paid by PTI and
its subsidiaries during such period, in each case, as determined on a
consolidated basis in accordance with GAAP. For purposes of the foregoing, gross
interest expense shall be determined after giving effect to any net payments
received by PTI or its subsidiaries with respect to the interest rate protection
agreements relating to PTI and its subsidiaries.
"Consolidated Net Income" shall mean, for any period, net income or
loss of PTI and its subsidiaries for such period determined on a consolidated
basis in accordance with GAAP; provided that there shall be excluded (a) the
income of any person in which any other person (other than PTI or any of its
subsidiaries or any director holding qualifying shares in compliance with
applicable law) has a joint interest, except to the extent of the amount of
dividends or other distributions actually paid to PTI or any of its subsidiaries
by such person during such period and (b) the income (or loss) of any person
accrued prior to the date it becomes a subsidiary of PTI or is merged into or
consolidated with PTI or any of its subsidiaries or the date that person's
assets are acquired by PTI or any of its subsidiaries.
"Consolidated Net Worth" shall mean, as at any date of determination,
the consolidated stockholders' equity of PTI and its subsidiaries, as determined
on a consolidated basis in accordance with GAAP.
"Control" shall mean the possession, directly or indirectly, of the
power to direct or cause the direction of the management or policies of a
person, whether through the ownership of voting securities, by contract or
otherwise, and the terms "Controlling" and "Controlled" shall have meanings
correlative thereto.
"Default" shall mean any event or condition which upon notice, lapse of
time or both would constitute an Event of Default.
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"Depositary Shares" shall mean the American Depositary Shares,
evidenced by American Depositary Receipts, each such American Depositary Share
representing four Shares.
"dollars" or "$" shall mean lawful money of the United States of
America.
"Energyco" shall mean PacifiCorp EnergyCo, an unlimited company
incorporated in England and Wales, all the outstanding share capital of which on
the Restatement Date is beneficially owned by Newco.
"Energyco Bridge Loan Agreement" shall mean the bridge loan agreement
dated as of the Closing Date, among Energyco, Newco, the lenders from time to
time party thereto, the Arrangers named therein, and Citibank, as administrative
agent thereunder.
"environment" shall mean ambient air, surface water and groundwater
(including potable water, navigable water and wetlands), the land surface or
subsurface strata, the workplace or as otherwise defined in any Environmental
Law.
"Environmental Claim" shall mean any written accusation, allegation,
notice of violation, claim, demand, order, directive, cost recovery action or
other cause of action by, or on behalf of, any Governmental Authority or any
person for damages, injunctive or equitable relief, personal injury (including
sickness, disease or death), Remedial Action costs, tangible or intangible
property damage, natural resource damages, nuisance, pollution, any adverse
effect on the environment caused by any Hazardous Material, or for fines,
penalties or restrictions, resulting from or based upon (a) the existence, or
the continuation of the existence, of a Release (including sudden or non-sudden,
accidental or nonaccidental Releases), (b) exposure to any Hazardous Material,
(c) the presence, use, handling, transportation, storage, treatment or disposal
of any Hazardous Material or (d) the violation or alleged violation of any
Environmental Law or Environmental Permit.
"Environmental Law" shall mean any and all applicable present and
future treaties, laws, rules, regulations, codes, ordinances, orders, decrees,
judgments, injunctions, notices or binding agreements issued, promulgated or
entered into by any Governmental Authority, relating in any way to the
environment, preservation or reclamation of natural resources, the management,
Release or threatened Release of any Hazardous Material or to health and safety
matters.
"Environmental Permit" shall mean any permit, approval, authorization,
certificate, license, variance, filing or permission required by or from any
Governmental Authority pursuant to any Environmental Law.
"Equity Issuance" shall mean any issuance or sale by the Borrower or
any Restricted Subsidiary of any shares of capital stock or other equity
securities of the Borrower or any Restricted Subsidiary or any obligations
convertible into or exchangeable for, or giving any person a right, option or
warrant to acquire such securities or such convertible or exchangeable
obligations, except in each case for (a) any issuance or sale to, or any other
capital contribution by, PacifiCorp, the Borrower, any wholly owned Restricted
Subsidiary or Newco, (b) any issuance of directors' qualifying shares, (c) any
issuance or sale to officers and employees under employee benefit or
compensation plans and (d) any issuance or sale of an interest in a Single
Purpose Entity.
8
"ERISA" shall mean the Employee Retirement Income Security Act of 1974,
as the same may be amended from time to time.
"ERISA Affiliate" shall mean any trade or business (whether or not
incorporated) that, together with the Borrower, is treated as a single employer
under Section 414(b) or (c) of the Code, or solely for purposes of Section 302
of ERISA and Section 412 of the Code, is treated as a single employer under
Section 414 of the Code.
"ERISA Event" shall mean (a) any "reportable event", as defined in
Section 4043 of ERISA or the regulations issued thereunder, with respect to a
Plan, except a reportable event for which the requirement of notice to the PBGC
has been waived; (b) the adoption of any amendment to a Plan that would require
the provision of security pursuant to Section 401(a)(29) of the Code or Section
307 of ERISA; (c) the existence with respect to any Plan of an "accumulated
funding deficiency" (as defined in Section 412 of the Code or Section 302 of
ERISA), whether or not waived; (d) the filing pursuant to Section 412(d) of the
Code or Section 303(d) of ERISA of an application for a waiver of the minimum
funding standard with respect to any Plan; (e) the incurrence of any liability
in excess of $1,000,000 under Title IV of ERISA with respect to the termination
of any Plan or the withdrawal or partial withdrawal of the Borrower or any of
its ERISA Affiliates from any Plan or Multiemployer Plan; (f) the receipt by the
Borrower or any ERISA Affiliate from the PBGC or a plan administrator of a
Multiemployer Plan of any notice relating to the intention to terminate any Plan
or Plans or to appoint a trustee to administer any Plan; (g) the receipt by the
Borrower or any ERISA Affiliate of any notice concerning the imposition of
Withdrawal Liability in excess of $1,000,000 or a determination that a
Multiemployer Plan is, or is expected to be, insolvent or in reorganization,
within the meaning of Title IV of ERISA; (h) the occurrence of a "prohibited
transaction" with respect to which the Borrower or any of its subsidiaries is a
party to the prohibited transaction and is a "disqualified person" (within the
meaning of Section 4975 of the Code) or with respect to which the Borrower or
any such subsidiary could otherwise be liable; and (i) any other event or
condition with respect to a Plan or Multiemployer Plan that could reasonably be
expected to result in liability of the Borrower in excess of $1,000,000.
"Eurodollar Borrowing" shall mean a Borrowing comprised of Eurodollar
Loans.
"Eurodollar Loan" shall mean any Eurodollar Revolving Loan or
Eurodollar Term Loan.
"Eurodollar Revolving Loan" shall mean any Revolving Loan bearing
interest at a rate determined by reference to the Adjusted LIBO Rate in
accordance with the provisions of Article II.
"Eurodollar Term Borrowing" shall mean a Borrowing comprised of
Eurodollar Term Loans.
"Eurodollar Term Loan" shall mean any Term Loan bearing interest at a
rate determined by reference to the Adjusted LIBO Rate in accordance with the
provisions of Article II.
"Event of Default" shall have the meaning assigned to such term in
Article VII.
"Exchange Rate Protection Agreement" shall mean any Hedging Agreement
that is (a) entered into by the Borrower with a counterparty that as of the date
of such Hedging Agreement is a Lender
9
(or an affiliate of a Lender) and (b) designed to protect the Borrower against
fluctuations in currency exchange rates and not for speculation.
"Excluded Assets" shall mean the assets set forth on Schedule 1.01(a).
"Existing Indebtedness" shall mean the Indebtedness of the Borrower
existing on the Closing Date and set forth on Schedule 1.01(b).
"Fees" shall mean the Commitment Fees, the L/C Participation Fees and
the Issuing Bank Fees.
"FinanceCo" shall mean PacifiCorp Finance (UK) Limited, a limited
company incorporated in England and Wales, all the outstanding share capital of
which on the Restatement Date is beneficially owned by Recco.
"Financial Officer" of any corporation shall mean the chief financial
officer, principal accounting officer, Treasurer or Controller of such
corporation.
"Funding Exchange Rate Protection Agreement" shall mean any Exchange
Rate Protection Agreement that is designed to ensure that the applicable
borrowings under this Agreement, the Energyco Bridge Loan Agreement and the
Powercoal Credit Agreement will provide a sufficient amount in pounds sterling
(together with borrowings under the Bidco Facility Agreement and certain other
sources of funds) to pay for the Shares.
"GAAP" shall mean generally accepted accounting principles in the
United States applied on a consistent basis.
"Goldman" shall mean Xxxxxxx Sachs Credit Partners L.P., a Bermuda
limited partnership.
"Governmental Authority" shall mean any Federal, state, local or
foreign court or governmental agency, authority, instrumentality or regulatory
body.
"Guarantee" of or by any person shall mean any obligation, contingent
or otherwise, of such person guaranteeing or having the economic effect of
guaranteeing any Indebtedness of any other person (the "primary obligor") in any
manner, whether directly or indirectly, and including any obligation of such
person, direct or indirect, (a) to purchase or pay (or advance or supply funds
for the purchase or payment of) such Indebtedness or to purchase (or to advance
or supply funds for the purchase of) any security for the payment of such
Indebtedness, (b) to purchase or lease property, securities or services for the
purpose of assuring the owner of such Indebtedness of the payment of such
Indebtedness or (c) to maintain working capital, equity capital or any other
financial statement condition or liquidity of the primary obligor so as to
enable the primary obligor to pay such Indebtedness; provided, however, that the
term "Guarantee" shall not include endorsements for collection or deposit in the
ordinary course of business.
"Hazardous Materials" shall mean all explosive or radioactive
substances or wastes, hazardous or toxic substances or wastes, pollutants,
solid, liquid or gaseous wastes, including petroleum or petroleum distillates,
asbestos or asbestos containing materials, polychlorinated
10
biphenyls ("PCBs") or PCB-containing materials or equipment, radon gas,
infectious or medical wastes and all other substances or wastes of any nature
regulated pursuant to any Environmental Law.
"Hedging Agreement" shall mean any rate swap transaction, basis swap,
forward rate transaction, commodity swap, commodity option, equity or equity
index swap, equity or equity index option, bond option, interest rate option,
foreign exchange transaction, cap transaction, floor transaction, collar
transaction, currency swap transaction, cross-currency rate swap transaction,
currency option or any other similar transaction (including any option with
respect to any of the foregoing transactions) or any combination of the
foregoing transactions.
"Indebtedness" of any person shall mean, without duplication, (a) all
obligations of such person for borrowed money, (b) all obligations of such
person evidenced by bonds, debentures, notes or similar instruments, (c) all
obligations of such person under conditional sale or other title retention
agreements relating to property or assets purchased by such person, (d) all
obligations of such person issued or assumed as the deferred purchase price of
property or services (excluding trade accounts payable and accrued obligations
incurred in the ordinary course of business), (e) all Indebtedness of others
secured by (or for which the holder of such Indebtedness has an existing right,
contingent or otherwise, to be secured by) any Lien on property owned or
acquired by such person, whether or not the obligations secured thereby have
been assumed (provided that, for purposes hereof, the amount of such
Indebtedness shall be limited to the lesser of (x) the principal amount thereof
and (y) the fair market value of such property), (f) all Guarantees by such
person of Indebtedness of others, (g) all Capital Lease Obligations of such
person and (h) all obligations of such person as an account party in respect of
letters of credit and bankers' acceptances; provided that, for purposes of the
definition of "Total Debt" as used in Section 6.11, "Indebtedness" shall also
include all obligations of such person in respect of Hedging Agreements (other
than any interest rate protection agreement and any exchange rate protection
agreement, in each case relating to PTI) to the extent the Net Termination Value
of such Hedging Agreements at any time exceeds $30,000,000. For purposes of this
Agreement, the amount of Non-Recourse Indebtedness of the Borrower and its
subsidiaries included in the calculation of Indebtedness of the Borrower and its
subsidiaries at any time shall equal the lesser of (i) the aggregate principal
amount of such Indebtedness and (ii) the equity of the Borrower and its
subsidiaries in the asset or Single Purpose Entity, as the case may be, relating
to such Non- Recourse Indebtedness. For purposes of this Agreement, the amount
of Indebtedness (other than Non- Recourse Indebtedness) of any partnership,
limited liability company or similar pass-through entity (as used in this
definition, a "partnership") in which the Borrower or a subsidiary is a general
partner or other member or equity holder with unlimited liability (as used in
this definition, a "general partner") and in which there are one or more
Qualified General Partners shall only be included in the calculation of
Indebtedness of the Borrower and its subsidiaries at any time (a) to the extent
of the Borrower's or such subsidiary's pro rata share of the interest of the
general partners in the partnership at such time, or (b) if the applicable
governing or other relevant agreement specifies that the Borrower or any of its
subsidiaries is liable to the partnership or its creditors for a specific
percentage of such partnership's liabilities, to the extent of such specified
percentage. For purposes hereof, "Qualified General Partner" shall mean a
general partner of a partnership that (a) is a person that was not created
solely for the purpose of investing in such partnership, and (b) at the time of
the investment in such partnership, the Borrower reasonably believes that (i)
such person has a credit quality (or credit support) approximately equal to that
of the Borrower or the applicable subsidiary and (ii) such person will be able
to perform its share of the obligations under such Indebtedness when due.
11
"Initial Lenders" shall mean Citibank, Goldman and Xxxxxx.
"Intercompany Loan Agreement" shall mean (a) the Umbrella Loan
Agreement dated as of April 4, 1983, between PacifiCorp and certain of its
subsidiaries, as in effect on the Closing Date, (b) the Intercompany Borrowing
Agreement dated as of April 1, 1991, between the Borrower and certain of its
subsidiaries and affiliates, as in effect on the Closing Date, and (c) any
additional or substitute intercompany lending agreement, or amendment thereto,
among substantially the same parties and on substantially the same terms and
conditions (other than rates of interest) as any agreement described in clause
(a) or (b) above.
"Interest Expense" shall mean, for any period of four consecutive
fiscal quarters, the interest expense (including related commitment fees,
facilities fees and similar fees) accrued during such period in respect of
Indebtedness of the Borrower; provided that interest expense in respect of
Indebtedness Guaranteed by the Borrower shall be included only to the extent
actually paid by the Borrower.
"Interest Expense (After Tax)" shall mean, for any period of four
consecutive fiscal quarters, an amount equal to (a) the Interest Expense for
such period minus (b) the Tax Benefit for such period.
"Interest Payment Date" shall mean, with respect to any Loan, the last
day of the Interest Period applicable to the Borrowing of which such Loan is a
part and, in the case of a Eurodollar Borrowing with an Interest Period of more
than three months' duration, each day that would have been an Interest Payment
Date had successive Interest Periods of three months' duration been applicable
to such Borrowing, and, in addition, the date of any prepayment of such
Borrowing or conversion of such Borrowing to a Borrowing of a different Type.
"Interest Period" shall mean (a) as to any Eurodollar Borrowing, the
period commencing on the date of such Borrowing and ending on the numerically
corresponding day (or, if there is no numerically corresponding day, on the last
day) in the calendar month that is 1, 2, 3 or 6 months thereafter, as the
Borrower may elect and (b) as to any Base Rate Borrowing, the period commencing
on the date of such Borrowing and ending on the earliest of (i) the next
succeeding March 31, June 30, September 30 or December 31, (ii) the Maturity
Date, and (iii) the date such Borrowing is converted to a Borrowing of a
different Type in accordance with Section 2.10 or repaid or prepaid in
accordance with Section 2.11, 2.12 or 2.13; provided, however, that if any
Interest Period would end on a day other than a Business Day, such Interest
Period shall be extended to the next succeeding Business Day unless, in the case
of a Eurodollar Borrowing only, such next succeeding Business Day would fall in
the next calendar month, in which case such Interest Period shall end on the
next preceding Business Day. Interest shall accrue from and including the first
day of an Interest Period to but excluding the last day of such Interest Period.
"Interest Rate Protection Agreement" shall mean any Hedging Agreement
that is (a) entered into by the Borrower with a counterparty that as of the date
of such Hedging Agreement is a Lender (or an affiliate of a Lender) and (b)
designed to protect the Borrower against fluctuations in interest rates and not
for speculation.
"Issuing Bank Fees" shall have the meaning assigned to such term in
Section 2.05(b).
12
"L/C Commitment" shall mean the commitment of the Issuing Bank to issue
Letters of Credit pursuant to Section 2.22.
"L/C Disbursement" shall mean a payment or disbursement made by the
Issuing Bank pursuant to a Letter of Credit.
"L/C Exposure" shall mean at any time the sum of (a) the aggregate
undrawn amount of all outstanding Letters of Credit at such time plus (b) the
aggregate principal amount of all L/C Disbursements that have not yet been
reimbursed at such time. The L/C Exposure of any Revolving Credit Lender at any
time shall mean its Pro Rata Percentage of the aggregate L/C Exposure at such
time.
"L/C Participation Fee" shall have the meaning assigned to such term in
Section 2.05(b).
"Lenders" shall mean (a) the Initial Lenders (other than any such
Initial Lender that has ceased to be a party hereto pursuant to an Assignment
and Acceptance) and (b) any financial institution that has become a party hereto
pursuant to an Assignment and Acceptance.
"Letter of Credit" shall mean any letter of credit issued pursuant to
Section 2.22.
"LIBO Rate" shall mean, with respect to any Eurodollar Borrowing for
any Interest Period, the rate appearing on Page 3750 of the Telerate Service (or
on any successor or substitute page of such Service, or any successor to or
substitute for such Service, providing rate quotations comparable to those
currently provided on such page of such Service, as determined by the Paying
Agent from time to time for purposes of providing quotations of interest rates
applicable to dollar deposits in the London interbank market) at approximately
11:00 a.m., London time, two Business Days prior to the commencement of such
Interest Period, as the rate for dollar deposits with a maturity comparable to
such Interest Period. In the event that such rate is not available at such time
for any reason, then the "LIBO Rate" with respect to such Eurodollar Borrowing
for such Interest Period shall be the rate at which dollar deposits of
$5,000,000 and for a maturity comparable to such Interest Period are offered by
the principal London office of the Paying Agent in immediately available funds
in the London interbank market at approximately 11:00 a.m., London time, two
Business Days prior to the commencement of such Interest Period.
"Lien" shall mean, with respect to any asset, (a) any mortgage, deed of
trust, lien, pledge, encumbrance, charge or security interest in or on such
asset, (b) the interest of a vendor or a lessor under any conditional sale
agreement, capital lease or title retention agreement relating to such asset and
(c) any other preferential arrangement that has substantially the same practical
effect as a security interest.
"Loan Documents" shall mean this Agreement and the Pledge Agreement.
"Loans" shall mean the Revolving Loans and the Term Loans.
"Margin Stock" shall have the meaning assigned to such term in
Regulation U.
13
"Material Adverse Effect" shall mean (a) a materially adverse effect on
the business, assets, liabilities, operations or condition, financial or
otherwise, of the Borrower and the Restricted Subsidiaries, taken as a whole,
(b) material impairment of the ability of the Borrower to perform its
obligations under the Loan Documents to which it is or will be a party or (c)
material impairment of the rights of or benefits available to the Lenders under
the Loan Documents; provided, that only clauses (b) and (c) shall apply after
PTI is no longer a subsidiary of the Borrower.
"Material Hedging Obligations" shall mean payment obligations in
respect of one or more Hedging Agreements with a single counterparty (or its
Affiliates) that have Negative Termination Values exceeding $50,000,000 in the
aggregate amount.
"Maturity Date" shall mean June 12, 1999.
"Xxxxxx" shall mean Xxxxxx Guaranty Trust Company of New York, a New
York banking corporation.
"Multiemployer Plan" shall mean a multiemployer plan as defined in
Section 4001(a)(3) of ERISA.
"Negative Termination Value" shall mean, with respect to any Hedging
Agreement, the amount (if any) that would be required to be paid by the Borrower
or any Restricted Subsidiary if such Hedging Agreement were terminated by reason
of a default by or other termination event relating to the Borrower or any
Restricted Subsidiary. The Negative Termination Value of any Hedging Agreement
at any date shall be determined (a) as of the end of the most recent fiscal
quarter ended on or prior to such date if such Hedging Agreement was then
outstanding or (b) as of the date such Hedging Agreement is entered into if it
is entered into after the end of such fiscal quarter; provided, however, that if
an agreement between the Borrower or any Restricted Subsidiary and the relevant
counterparty provides that, upon any such termination by such counterparty, one
or more other Hedging Agreements (if any then exist) between the Borrower or any
Restricted Subsidiary and such counterparty would also terminate and the amount
(if any) payable by the Borrower or any Restricted Subsidiary would be a net
amount reflecting the termination of all Hedging Agreements so terminated, then
the Negative Termination Value of all the Hedging Agreements subject to such
netting shall be, at any date, a single amount equal to such net amount (if any)
payable by the Borrower or any Restricted Subsidiary determined as of the later
of (a) the end of the most recently ended fiscal quarter or (b) the date on
which the most recent Hedging Agreement subject to such netting was entered
into.
"Net Cash Proceeds" shall mean (a) with respect to any Asset Sale or a
sale permitted by Section 6.05(a)(v), the cash proceeds thereof received by the
Borrower or the Restricted Subsidiaries (including cash and cash equivalents and
cash payments received by way of deferred payment of principal pursuant to a
note or installment receivable or otherwise, but only as and when received), net
of (i) costs of sale (including payment of the outstanding principal amount of,
premium or penalty, if any, interest and other amounts on any Indebtedness
(other than Loans) secured by a Lien permitted pursuant to Section 6.02 on such
assets and required to be repaid under the terms thereof as a result of such
Asset Sale), (ii) taxes paid or payable in the year such Asset Sale occurs or in
the following year as a result thereof and (iii) amounts provided as a reserve
against any liabilities under any indemnification obligations associated with
such Asset Sale (except that, to the extent and at the time any such amounts are
released from such reserve, such amounts shall constitute Net Cash Proceeds);
14
provided, however, that in the event the Asset Sale is a result of a Casualty
Event or Condemnation Event, the cash proceeds thereof for purposes of this
definition shall not include proceeds thereof to the extent they are used (or
committed to be used) to replace or repair the damaged or condemned property, as
applicable, within 180 days of receipt of such proceeds, in each case so long as
no Default or Event of Default shall have occurred and be continuing, and (b)
with respect to any Equity Issuance or any issuance or other disposition of
Indebtedness for borrowed money, the cash proceeds thereof net of underwriting
commissions or placement fees and expenses directly incurred in connection
therewith. Notwithstanding anything to the contrary, "Net Cash Proceeds" shall
not include proceeds from an Asset Sale by any Restricted Subsidiary, to the
extent that such Restricted Subsidiary shall have (a) applied such proceeds
within three Business Days of the receipt thereof to the repayment of
Indebtedness of such Restricted Subsidiary that cannot by its terms be
reborrowed or (b) notified the Paying Agent, within three Business Days of
receipt of such proceeds, of its intention to apply such proceeds to the
repayment of such Indebtedness and shall have completed such repayment within 45
days of the receipt thereof.
"Net Effective Tax Rate" shall mean, for any period, the net effective
book rate of Federal and state income tax recorded for such period by the
consolidated group of which the Borrower was a member.
"Net Termination Value" shall mean, with respect to all Hedging
Agreements (other than any Interest Rate Protection Agreement and any Exchange
Rate Protection Agreement), the difference between (a) the aggregate amounts (if
any) that would be required to be paid by the Borrower or any Restricted
Subsidiary if such Hedging Agreements were terminated by reason of a default
relating to the Borrower or any Restricted Subsidiary, and (b) the aggregate
amounts (if any) that the Borrower or any Restricted Subsidiary would be
entitled to receive if such Hedging Agreements were terminated by reason of a
default relating to the Borrower or any Restricted Subsidiary. The Net
Termination Value shall be determined (a) as of the end of the most recent
fiscal quarter ended on or prior to such date if such Hedging Agreement was then
outstanding or (b) as of the date such Hedging Agreement is entered into if it
is entered into after the end of such fiscal quarter.
"Newco" shall mean PacifiCorp Group Holdings Company, a corporation
organized under the laws of Oregon, all the outstanding capital stock of which
on the Restatement Date is directly owned by the Borrower.
"Non-Recourse Indebtedness" of any person shall mean at any time
Indebtedness secured by a Lien in or upon one or more assets of such person
where the rights and remedies of the holder of such Indebtedness in respect of
such Indebtedness do not extend to any other assets of such person.
Notwithstanding the foregoing, Indebtedness of any person shall not fail to
constitute Non-Recourse Indebtedness by reason of the inclusion in any document
evidencing, governing, securing or otherwise relating to such Indebtedness of
provisions to the effect that such person shall be liable beyond the assets
securing such Indebtedness, for (a) misapplied moneys, including insurance and
condemnation proceeds and security deposits, (b) indemnification by such person
in favor of holders of such Indebtedness and their affiliates in respect of
liabilities to third parties, including environmental liabilities, (c) breaches
of customary representations and warranties given to the holders of such
Indebtedness and (d) such other similar obligations as are customarily excluded
from the provisions that otherwise limit the recourse of commercial lenders
making so-called "non-
15
recourse" loans to institutional borrowers. Indebtedness of a Single Purpose
Entity shall constitute Non-Recourse Indebtedness of such Single Purpose Entity.
"Obligations" shall have the meaning assigned to such term in the
Pledge Agreement.
"Offer" shall mean the offer by Xxxxxxx Sachs International on behalf
of Bidco to acquire all of the outstanding Shares (including Shares represented
by Depositary Shares), substantially on the terms and conditions referred to in
the press release related thereto, as amended, supplemented or otherwise
modified.
"Offer Document" shall mean the document to be delivered to the
shareholders of the Target containing the formal Offer.
"Open Market Shares" shall mean the purchase of Shares by the Borrower
in the open market prior to the Unconditional Date.
"PacifiCorp" shall mean PacifiCorp, a corporation organized under the
laws of Oregon.
"PBGC" shall mean the Pension Benefit Guaranty Corporation referred to
and defined in ERISA.
"PCI" shall mean PacifiCorp Credit, Inc., a corporation organized under
the laws of Oregon.
"Permitted Investments" shall mean:
(a) direct obligations of, or obligations the principal of and
interest on which are unconditionally guaranteed by, the United States
of America (or by any agency thereof to the extent such obligations are
backed by the full faith and credit of the United States of America),
in each case maturing within one year from the date of acquisition
thereof;
(b) investments in commercial paper (or money market funds
substantially all the assets of which are invested in such commercial
paper) maturing within 270 days from the date of acquisition thereof
and having, at such date of acquisition, one of the two highest credit
ratings obtainable from Standard & Poor's Ratings Group or from Xxxxx'x
Investors Service, Inc.;
(c) investments in certificates of deposit, banker's
acceptances and time deposits maturing within one year from the date of
acquisition thereof issued or guaranteed by or placed with, and money
market deposit accounts issued or offered by, any domestic office of
any commercial bank organized under the laws of the United States of
America or any State thereof that has a combined capital and surplus
and undivided profits of not less than $250,000,000; and
(d) obligations issued by any state or political subdivision
thereof, having a rating of A or better by Standard & Poor's Ratings
Group, or a similar rating by any other nationally recognized rating
agency with maturities of not more than one year.
16
"person" shall mean any natural person, corporation, limited liability
company, business trust, joint venture, association, company, partnership or
government, or any agency or political subdivision thereof.
"PFS" shall mean PacifiCorp Financial Services, Inc., a corporation
organized under the laws of Oregon.
"PFSAC" shall mean PFS Acquisition Corp., an Oregon corporation, all
the capital stock of which is directly owned by PacifiCorp.
"PFSAC Obligation" shall mean, collectively, the agreement between the
Borrower and PFSAC, the obligation under which shall be payable with proceeds
from the sale of certain assets of PFS, and the pledge agreement between the
Borrower and PFSAC covering all of the issued and outstanding stock of PFS as
security for payments under the agreement.
"PFS Intercompany Note" shall mean the note issued by PFS to the
Borrower evidencing certain intercompany loans made by the Borrower to PFS.
"PFS Pre-Funding Sale" shall mean the sale of PFS by the Borrower to
PFSAC, in exchange for $70,000,000 in cash and the PFSAC Obligation.
"Plan" shall mean any employee pension benefit plan (other than a
Multiemployer Plan) subject to the provisions of Title IV of ERISA or Section
412 of the Code or Section 307 of ERISA, and in respect of which the Borrower or
any ERISA Affiliate is (or, if such plan were terminated, would under Section
4069 of ERISA be deemed to be) an "employer" as defined in Section 3(5) of
ERISA.
"Pledge Agreement" shall mean the Pledge Agreement, substantially in
the form of Exhibit D, between the Borrower and the Collateral Agent for the
benefit of the Secured Parties.
"pounds sterling" or "xxxxx" shall mean the lawful currency for the
time being of the United Kingdom.
"Powercoal" shall mean PacifiCorp Powercoal LLC, an Oregon limited
liability company, all the capital stock of which on the Restatement Date is
directly owned by Newco.
"Powercoal/Bidco Loans" shall have the meaning assigned to such term in
the Powercoal Credit Agreement.
"Powercoal Credit Agreement" shall mean the credit agreement dated as
of the Closing Date, among Powercoal, the lenders from time to time party
thereto, and Xxxxxx, as paying agent, collateral agent, issuing bank and
swingline lender.
"Powercor" shall mean Powercor Australia Limited, a limited company
organized under the laws of Australia.
17
"Powercor Contribution" shall mean the contribution of all the share
capital of the members of the holding company of Powercor by the Borrower to
Newco.
"PPM" shall mean PacifiCorp Power Marketing, Inc., a corporation
organized under the laws of Oregon.
"PPM Contribution" shall mean the indirect contribution of all the
capital stock of PPM by the Borrower to Powercoal.
"Prepayment Account" shall have the meaning assigned to such term in
Section 2.13(f).
"Pro Rata Percentage" of any Revolving Credit Lender at any time shall
mean the percentage of the Total Revolving Credit Commitment represented by such
Lender's Revolving Credit Commitment.
"PTI" shall mean Pacific Telecom, Inc., a corporation organized under
the laws of the State of Washington.
"PTI Asset Sale" shall mean the sale, lease, transfer or other
disposition (by way of merger or otherwise, including as a result of a
Condemnation Event or a Casualty Event) by PTI or any of its subsidiaries to any
person other than the Borrower or any wholly owned Restricted Subsidiary of (a)
any capital stock of any subsidiary of PTI or (b) any other assets of PTI or any
of its subsidiaries (other than inventory, obsolete or worn-out assets, scrap
and Permitted Investments, in each case disposed of in the ordinary course of
business), except for any sale, lease, transfer or other disposition in one
transaction or a series of related transactions having a value of $25,000,000 or
less. Notwithstanding the foregoing, the term "PTI Asset Sale" shall not include
(a) the payment of a cash dividend permitted by Section 6.06(a), (b) the sale,
lease, transfer or other disposition of assets included on Schedule 1.01(c), (c)
transfers of assets as part of a sale and lease-back transaction permitted by
Section 6.03 and (d) any substantially contemporaneous exchange (including by
way of a substantially contemporaneous purchase and sale) of assets of PTI or
any of its subsidiaries for one or more local exchange networks located in the
United States, in each case to the extent that no net cash proceeds are received
by PTI or any of its subsidiaries as consideration in connection with such
exchange.
"Recco" shall mean PacifiCorp Services Limited, a limited company
incorporated in England and Wales, all of the outstanding share capital of which
on the Restatement Date is directly owned by Energyco.
"Refinanced Indebtedness" shall mean the Indebtedness of the Borrower
listed on Schedule 1.01(d).
"Refinancing Indebtedness" shall have the meaning assigned to such term
in Section 6.01(g).
"Register" shall have the meaning given to such term in Section
9.04(d).
"Regulation G" shall mean Regulation G of the Board as from time to
time in effect and all official rulings and interpretations thereunder or
thereof.
18
"Regulation T" shall mean Regulation T of the Board as from time to
time in effect and all official rulings and interpretations thereunder or
thereof.
"Regulation U" shall mean Regulation U of the Board as from time to
time in effect and all official rulings and interpretations thereunder or
thereof.
"Regulation X" shall mean Regulation X of the Board as from time to
time in effect and all official rulings and interpretations thereunder or
thereof.
"Release" shall mean any spilling, leaking, pumping, pouring, emitting,
emptying, discharging, injecting, escaping, leaching, dumping, disposing,
depositing, dispersing, emanating or migrating of any Hazardous Material in,
into, onto or through the environment.
"Remedial Action" shall mean (a) "remedial action" as such term is
defined in CERCLA, 42 U.S.C. Section 9601(24), and (b) all other actions
required by any Governmental Authority or voluntarily undertaken to: (i)
cleanup, remove, treat, xxxxx or in any other way address any Hazardous Material
in the environment; (ii) prevent the Release or threat of Release or minimize
the further Release of any Hazardous Material so it does not migrate or endanger
or threaten to endanger public health, welfare or the environment; or (iii)
perform studies and investigations in connection with, or as a precondition to,
(i) or (ii) above.
"Required Lenders" shall mean, at any time, Lenders having Loans, L/C
Exposure and unused Revolving Credit and Term Loan Commitments representing at
least a majority of the sum of all Loans outstanding, L/C Exposure and unused
Revolving Credit and Term Loan Commitments at such time.
"Responsible Officer" of any corporation shall mean any executive
officer or Financial Officer of such corporation and any other officer or
similar official thereof responsible for the administration of the obligations
of such corporation in respect of this Agreement.
"Restatement Date" shall mean June 27, 1997.
"Restricted Subsidiary" shall mean any person listed on Schedule
1.01(e) until the date such person is no longer a subsidiary of the Borrower.
"Revolving Credit Borrowing" shall mean a Borrowing comprised of
Revolving Loans.
"Revolving Credit Commitment" shall mean, with respect to each Lender,
the commitment of such Lender to make Revolving Loans hereunder as set forth on
Schedule 2.01, or in the Assignment and Acceptance pursuant to which such Lender
assumed its Revolving Credit Commitment, as applicable, as the same may be (a)
reduced from time to time pursuant to Section 2.09 and (b) reduced or increased
from time to time pursuant to assignments by or to such Lender pursuant to
Section 9.04.
"Revolving Credit Exposure" shall mean, with respect to any Lender at
any time, the aggregate principal amount at such time of all outstanding
Revolving Loans of such Lender, plus the aggregate amount at such time of such
Lender's L/C Exposure.
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"Revolving Credit Lender" shall mean a Lender with a Revolving Credit
Commitment.
"Revolving Loans" shall mean the revolving loans made by the Lenders to
the Borrower pursuant to Section 2.01(b). Each Revolving Loan shall be a
Eurodollar Revolving Loan or a Base Rate Revolving Loan.
"Secured Parties" shall have the meaning assigned to such term in the
Pledge Agreement.
"Shares" shall mean the ordinary shares of the Target (par value 10
xxxxx per share).
"Significant Subsidiary" shall mean, on any date, any Restricted
Subsidiary that (a) has total assets, determined on a consolidated basis with
its subsidiaries, as of the end of the fiscal quarter preceding such date equal
to or greater than 2.5% of the total assets of the Borrower and the Restricted
Subsidiaries on a consolidated basis as of the end of such fiscal quarter or (b)
has income from continuing operations before income taxes, extraordinary items
and the cumulative effect of a change in accounting principles ("Adjusted
Income"), determined on a consolidated basis with its subsidiaries, for the four
fiscal quarter period preceding such date equal to or greater than 2.5% of the
Adjusted Income of the Borrower and the Restricted Subsidiaries on a
consolidated basis for such period, in all cases as determined in accordance
with GAAP.
"Single Purpose Entity" shall mean a person, other than an individual,
that (a) is organized solely for the purpose of holding, directly or indirectly,
an ownership interest in one entity or property that is acquired, purchased or
constructed or in the case of previously undeveloped, non-income generating
property of the Borrower or a Restricted Subsidiary, developed by the Borrower
or any of the Restricted Subsidiaries, (b) does not engage in any business
unrelated to such entity or property or the financing thereof and (c) does not
have any assets or Indebtedness other than those related to its interest in such
entity or property or the financing thereof.
"Spring Creek" shall mean Spring Creek Coal Company, a corporation
organized under the laws of Montana.
"Spring Creek Coal Supply Contract" shall mean the Coal Supply
Agreement dated June 2, 1978, between Spring Creek and Utility Fuels, Inc., as
amended from time to time.
"Spring Creek Loan Agreement" shall mean the Loan Commitment and
Agreement dated as of June 2, 1993, between Spring Creek and the Borrower (under
which the Borrower designated PCI as the affiliate to make the initial loan of
$225,000,000 to Spring Creek), as such agreement may be amended from time to
time.
"Spring Creek Loan Documents" shall mean the "Loan Documents" (as such
term is defined in Section 1.1 of the Spring Creek Loan Agreement as in effect
on the Closing Date), as such Loan Documents may be amended from time to time.
"Spring Creek Note" shall mean the promissory note issued by Spring
Creek to PCI pursuant to the Spring Creek Loan Agreement, as such note may be
amended from time to time.
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"Spring Creek Obligations" shall mean the obligations under the Spring
Creek Loan Documents of Spring Creek, Spring Creek's affiliates and each issuer
of a Letter of Credit (as defined in Section 1.1 of the Spring Creek Loan
Agreement as in effect on the Closing Date), in each case whether now existing
or hereafter issued or arising.
"Spring Creek Participation Agreement" shall mean the Amended and
Restated Participation Agreement dated as of June 2, 1993, between PCI and the
Borrower (under which the Borrower purchased the Borrower's interest in the
Spring Creek Obligations from PCI), as such agreement may be amended from time
to time.
"Statutory Reserves" shall mean a fraction (expressed as a decimal),
the numerator of which is the number one and the denominator of which is the
number one minus the aggregate of the maximum reserve percentages (including any
marginal, special, emergency or supplemental reserves) expressed as a decimal
established by the Board (a) with respect to the Base CD Rate, for new
negotiable nonpersonal time deposits in dollars of over $100,000 with maturities
approximately equal to three months, and (b) with respect to the Adjusted LIBO
Rate, for Eurocurrency Liabilities (as defined in Regulation D of the Board).
Such reserve percentages shall include those imposed pursuant to such Regulation
D. Eurodollar Loans shall be deemed to constitute Eurocurrency Liabilities and
to be subject to such reserve requirements without benefit of or credit for
proration, exemptions or offsets that may be available from time to time to any
Lender under such Regulation D. Statutory Reserves shall be adjusted
automatically on and as of the effective date of any change in any reserve
percentage.
"subsidiary" shall mean, with respect to any person (herein referred to
as the "parent"), any corporation, partnership, association or other business
entity of which securities or other ownership interests representing more than
50% of the equity or more than 50% of the ordinary voting power or more than 50%
of the general partnership interests are, at the time any determination is being
made, owned, controlled or held by the parent.
"Target" shall mean The Energy Group PLC, a public limited company
incorporated in England and Wales.
"Tax Benefit" shall mean, for any period of four consecutive fiscal
quarters, the product of (a) the Interest Expense for such period and (b) the
Net Effective Tax Rate for such period.
"Tax Sharing Arrangement" shall mean the Capital Contribution Agreement
dated as of the Closing Date, the Income Tax Allocation Policy, restated as of
January 1, 1989, relating to the Borrower, PacifiCorp and the direct
subsidiaries of the Borrower, and the Income Tax Allocation Policy, dated as of
January 1, 1997, relating to Newco and its subsidiaries.
"Term Borrowing" shall mean a Borrowing comprised of Term Loans.
"Termination Date" shall mean the earlier of (a) December 30, 1997, and
(b) the later of (i) the date that is three months after the Unconditional Date
and (ii) the date that is 49 days after the first date on which Bidco acquires
90% of the outstanding Shares to which the Offer relates.
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"Term Loan Availability Period" shall mean the period from and
including the Closing Date to and including the Termination Date.
"Term Loan Commitment" shall mean, with respect to each Lender, the
commitment of such Lender to make Term Loans hereunder as set forth on Schedule
2.01, or in the Assignment and Acceptance pursuant to which such Lender assumed
its Term Loan Commitment, as applicable, as the same may be (a) reduced from
time to time pursuant to Section 2.09 and (b) reduced or increased from time to
time pursuant to assignments by or to such Lender pursuant to Section 9.04.
"Term Loans" shall mean the term loans made by the Lenders to the
Borrower pursuant to Section 2.01(a). Each Term Loan shall be either a
Eurodollar Term Loan or a Base Rate Term Loan.
"Three-Month Secondary CD Rate" shall mean, for any day, the secondary
market rate for three-month certificates of deposit reported as being in effect
on such day (or, if such day shall not be a Business Day, the next preceding
Business Day) by the Board through the public information telephone line of the
Federal Reserve Bank of New York (which rate will, under the current practices
of the Board, be published in Federal Reserve Statistical Release H.15(519)
during the week following such day), or, if such rate shall not be so reported
on such day or such next preceding Business Day, the average of the secondary
market quotations for three-month certificates of deposit of major money center
banks in New York City received at approximately 10:00 a.m., New York City time,
on such day (or, if such day shall not be a Business Day, on the next preceding
Business Day) by the Paying Agent from three New York City negotiable
certificate of deposit dealers of recognized standing selected by it.
"Total Debt" shall mean, as of any date of determination, without
duplication, the aggregate principal amount of Indebtedness of PTI and its
subsidiaries outstanding as of such date, determined on a consolidated basis
(other than Indebtedness of the type referred to in clause (h) of the definition
of the term "Indebtedness", except to the extent of any unreimbursed drawings
thereunder).
"Total Revolving Credit Commitment" shall mean, at any time, the
aggregate amount of the Revolving Credit Commitments, as in effect at such time.
"TPC" shall mean TPC Corporation, a corporation organized under the
laws of Delaware.
"TPC Contribution" shall mean the indirect contribution of all the
capital stock of TPC by the Borrower to Powercoal.
"Transaction Loan Documents" shall mean (a) the Loan Documents, (b) the
Bidco Facility Agreement and the security documents and guarantees related
thereto, (c) the Energyco Bridge Loan Agreement and the guarantees related
thereto and (d) the Powercoal Credit Agreement and the security documents and
guarantees related thereto.
"Transactions" shall mean the Offer, the transactions contemplated
thereby and the transactions contemplated by the Transaction Loan Documents.
22
"Type", when used in respect of any Loan or Borrowing, shall refer to
the Rate by reference to which interest on such Loan or on the Loans comprising
such Borrowing is determined. For purposes hereof, the term "Rate" shall include
the Adjusted LIBO Rate and the Base Rate.
"Unconditional Date" shall have the meaning assigned to such term in
the Bidco Facility Agreement as in effect on the Restatement Date.
"wholly owned Restricted Subsidiary" shall mean a Restricted Subsidiary
which securities (except for directors' qualifying shares) or other ownership
interests representing 100% of the equity or 100% of the ordinary voting power
(other than directors' qualifying shares) or 100% of the general partnership
interests are, at the time any determination is being made, owned, controlled or
held by the Borrower or one or more wholly owned Restricted Subsidiaries of the
Borrower or by the Borrower and one or more wholly owned Restricted Subsidiaries
of the Borrower.
"Withdrawal Liability" shall mean liability to a Multiemployer Plan as
a result of a complete or partial withdrawal from such Multiemployer Plan, as
such terms are defined in Part I of Subtitle E of Title IV of ERISA.
SECTION 1.02. Terms Generally. The definitions in Section 1.01 shall
apply equally to both the singular and plural forms of the terms defined.
Whenever the context may require, any pronoun shall include the corresponding
masculine, feminine and neuter forms. The words "include", "includes" and
"including" shall be deemed to be followed by the phrase "without limitation".
All references herein to Articles, Sections, Exhibits and Schedules shall be
deemed references to Articles and Sections of, and Exhibits and Schedules to,
this Agreement unless the context shall otherwise require. Except as otherwise
expressly provided herein, (a) any reference in this Agreement to any
Transaction Loan Document shall mean such document as amended, restated,
supplemented or otherwise modified from time to time and (b) all terms of an
accounting or financial nature shall be construed in accordance with GAAP, as in
effect from time to time; provided, however, that if the Borrower notifies the
Paying Agent that the Borrower wishes to amend any covenant in Article VI or any
related definition to eliminate the effect of any change in GAAP occurring after
the date of this Agreement on the operation of such covenant (or if the Paying
Agent notifies the Borrower that the Required Lenders wish to amend Article VI
or any related definition for such purpose), then the Borrower's compliance with
such covenant shall be determined on the basis of GAAP in effect immediately
before the relevant change in GAAP became effective, until either such notice is
withdrawn or such covenant or definition is amended in a manner satisfactory to
the Borrower and the Required Lenders.
ARTICLE II
The Credits
SECTION 2.01. Commitments. Subject to the terms and conditions and
relying upon the representations and warranties herein set forth, each Lender
agrees, severally and not jointly, (a) to make Term Loans to the Borrower at any
time on a single date on or after the Closing Date, and until the earlier of the
expiration of the Term Loan Availability Period and the termination of the Term
Loan Commitment of such Lender in accordance with the terms hereof, in an
aggregate principal amount not to exceed its Term Loan Commitment and (b) to
make Revolving Loans to the Borrower,
23
at any time and from time to time on or after the Closing Date, and until the
earlier of the Maturity Date and the termination of the Revolving Credit
Commitment of such Lender in accordance with the terms hereof, in an aggregate
principal amount at any time outstanding that will not result in such Lender's
Revolving Credit Exposure exceeding such Lender's Revolving Credit Commitment.
Within the limits set forth in clause (b) of the preceding sentence and subject
to the terms, conditions and limitations set forth herein, the Borrower may
borrow, pay or prepay and reborrow Revolving Loans. Amounts paid or prepaid in
respect of Term Loans may not be reborrowed.
SECTION 2.02. Loans. (a) Each Loan shall be made as part of a Borrowing
consisting of Loans made by the Lenders ratably in accordance with their
respective Term Loan Commitments or Revolving Credit Commitments, as applicable;
provided, however, that the failure of any Lender to make any Loan shall not in
itself relieve any other Lender of its obligation to lend hereunder (it being
understood, however, that no Lender shall be responsible for the failure of any
other Lender to make any Loan required to be made by such other Lender). The
Loans comprising any Borrowing shall be in an aggregate principal amount that is
(i) an integral multiple of $1,000,000 and not less than $5,000,000 or (ii)
equal to the remaining available balance of the applicable Commitments.
(b) Subject to Sections 2.08 and 2.15, each Borrowing shall be
comprised entirely of Base Rate Loans or Eurodollar Loans as the Borrower may
request pursuant to Section 2.03. Each Lender may at its option make any
Eurodollar Loan by causing any domestic or foreign branch or Affiliate of such
Lender to make such Loan; provided that any exercise of such option shall not
(i) affect the obligation of the Borrower to repay such Loan or (ii) increase
the costs of the Borrower that would otherwise be payable under Section 2.14 or
2.20 with respect thereto, in each case in accordance with the terms of this
Agreement. Borrowings of more than one Type may be outstanding at the same time;
provided, however, that the Borrower shall not be entitled to request any
Borrowing that, if made, would result in more than 15 Eurodollar Borrowings
outstanding hereunder at any time. For purposes of the foregoing, Borrowings
having different Interest Periods, regardless of whether they commence on the
same date, shall be considered separate Borrowings.
(c) Except with respect to Loans made or deemed made pursuant to
Section 2.02(f), each Lender shall make each Loan to be made by it hereunder on
the proposed date thereof by wire transfer of immediately available funds to
such account in New York City as the Paying Agent may designate not later than
11:00 a.m., New York City time, and the Paying Agent shall by 12:00 (noon), New
York City time, credit the amounts so received to an account in the name of the
Borrower, maintained with the Paying Agent and designated by the Borrower in the
applicable Borrowing Request or, if a Borrowing shall not occur on such date
because any condition precedent herein specified shall not have been met, return
the amounts so received to the respective Lenders.
(d) Unless the Paying Agent shall have received notice from a Lender
prior to the date of any Borrowing that such Lender will not make available to
the Paying Agent such Lender's portion of such Borrowing, the Paying Agent may
assume that such Lender has made such portion available to the Paying Agent on
the date of such Borrowing in accordance with paragraph (c) above and the Paying
Agent may, in reliance upon such assumption, make available to the Borrower on
such date a corresponding amount. If the Paying Agent shall have so made funds
available then, to the extent that such Lender shall not have made such portion
available to the Paying Agent, such Lender and the Borrower severally agree to
repay to the Paying Agent forthwith on demand such corresponding amount together
with interest thereon, for each day from the date such amount is made available
to
24
the Borrower until the date such amount is repaid to the Paying Agent at (i) in
the case of the Borrower, the interest rate applicable at the time to the Loans
comprising such Borrowing and (ii) in the case of such Lender, a rate determined
by the Paying Agent to represent its cost of overnight or short-term funds
(which determination shall be conclusive absent manifest error). If such Lender
shall repay to the Paying Agent such corresponding amount, such amount shall
constitute such Lender's Loan as part of such Borrowing for purposes of this
Agreement.
(e) Notwithstanding any other provision of this Agreement, the Borrower
shall not be entitled to request any Interest Period with respect to a Revolving
Credit Borrowing or Term Borrowing that would end after the Maturity Date.
(f) If the Issuing Bank shall not have received from the Borrower the
payment required to be made by Section 2.22(e) within the time specified in such
Section, the Issuing Bank will promptly notify the Paying Agent of the L/C
Disbursement and the Paying Agent will promptly notify each Revolving Credit
Lender of such L/C Disbursement and its Pro Rata Percentage thereof. Each
Revolving Credit Lender shall pay by wire transfer of immediately available
funds to the Paying Agent not later than 2:00 p.m., New York City time, on such
date (or, if such Revolving Credit Lender shall have received such notice later
than 12:00 (noon), New York City time, on any day, not later than 10:00 a.m.,
New York City time, on the immediately following Business Day), an amount equal
to such Lender's Pro Rata Percentage of such L/C Disbursement (it being
understood that such amount shall be deemed to constitute a Base Rate Revolving
Loan of such Lender and such payment shall be deemed to have reduced the L/C
Exposure), and the Paying Agent will promptly pay to the Issuing Bank amounts so
received by it from the Revolving Credit Lenders. The Paying Agent will promptly
pay to the Issuing Bank any amounts received by it from the Borrower pursuant to
Section 2.22(e) prior to the time that any Revolving Credit Lender makes any
payment pursuant to this paragraph (f); any such amounts received by the Paying
Agent thereafter will be promptly remitted by the Paying Agent to the Revolving
Credit Lenders that shall have made such payments and to the Issuing Bank, as
their interests may appear. If any Revolving Credit Lender shall not have made
its Pro Rata Percentage of such L/C Disbursement available to the Paying Agent
as provided above, such Lender and the Borrower severally agree to pay interest
on such amount, for each day from and including the date such amount is required
to be paid in accordance with this paragraph to but excluding the date such
amount is paid, to the Paying Agent for the account of the Issuing Bank at (i)
in the case of the Borrower, a rate per annum equal to the interest rate
applicable to Revolving Loans pursuant to Section 2.06(a), and (ii) in the case
of such Lender, for the first such day, the Federal Funds Effective Rate, and
for each day thereafter, the Base Rate.
SECTION 2.03. Borrowing Procedure. In order to request a Borrowing, the
Borrower shall hand deliver or telecopy to the Paying Agent a duly completed
Borrowing Request (a) in the case of a Eurodollar Borrowing, not later than
11:00 a.m., New York City time, three Business Days before a proposed Borrowing,
and (b) in the case of a Base Rate Borrowing, not later than 11:00 a.m., New
York City time, on the Business Day of a proposed Borrowing. Each Borrowing
Request shall be irrevocable, shall be signed by or on behalf of the Borrower
and shall specify the following information: (i) whether the Borrowing then
being requested is to be a Term Borrowing or a Revolving Credit Borrowing, and
whether such Borrowing is to be a Eurodollar Borrowing or a Base Rate Borrowing;
(ii) the date of such Borrowing (which shall be a Business Day); (iii) the
number and location of the account to which funds are to be disbursed (which
shall be an account that complies with the requirements of Section 2.02(c));
(iv) the amount of such Borrowing; and (v) if such
25
Borrowing is to be a Eurodollar Borrowing, the Interest Period with respect
thereto; provided, however, that, notwithstanding any contrary specification in
any Borrowing Request, each requested Borrowing shall comply with the
requirements set forth in Section 2.02. If no election as to the Type of
Borrowing is specified in any such notice, then the requested Borrowing shall be
a Base Rate Borrowing. If no Interest Period with respect to any Eurodollar
Borrowing is specified in any such notice, then the Borrower shall be deemed to
have selected an Interest Period of one month's duration. The Paying Agent shall
promptly advise the applicable Lenders of any notice given pursuant to this
Section 2.03 (and the contents thereof), and of each Lender's portion of the
requested Borrowing.
SECTION 2.04. Evidence of Debt; Repayment of Loans. (a) The Borrower
hereby unconditionally promises to pay to the Paying Agent for the account of
each Lender the principal amount of each Term Loan of such Lender as provided in
Section 2.11 and the then unpaid principal amount of each Revolving Loan on the
Maturity Date.
(b) Each Lender shall maintain in accordance with its usual practice an
account or accounts evidencing the indebtedness of the Borrower to such Lender
resulting from each Loan made by 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 Paying Agent shall maintain accounts in which it will record
(i) the amount of each Loan made hereunder, the Type thereof and the 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) the amount of any sum received by the Paying Agent hereunder from the
Borrower and each Lender's share thereof.
(d) The entries made in the accounts maintained pursuant to paragraphs
(b) and (c) above shall be prima facie evidence of the existence and amounts of
the obligations therein recorded; provided, however, that the failure of any
Lender or the Paying Agent to maintain such accounts or any error therein shall
not in any manner affect the obligations of the Borrower to repay the Loans in
accordance with their terms.
(e) Notwithstanding any other provision of this Agreement, in the event
any Lender shall request and receive a promissory note payable to such Lender
and its registered assigns, the interests represented by such note shall at all
times (including after any assignment of all or part of such interests pursuant
to Section 9.04) be represented by one or more promissory notes payable to the
payee named therein or its registered assigns.
SECTION 2.05. Fees. (a) The Borrower agrees to pay to each Lender,
through the Paying Agent, on the last day of March, June, September and December
in each year and on each date on which any Commitment of such Lender shall
expire or be terminated as provided herein, a commitment fee (a "Commitment
Fee") of 0.50% per annum on the average daily unused amount of the Commitments
of such Lender during the preceding quarter (or other period commencing with the
Closing Date or ending with the Maturity Date or the date on which the
Commitments of such Lender shall expire or be terminated). All Commitment Fees
shall be computed on the basis of the actual number of days elapsed in a year of
360 days. The Commitment Fee due to each Lender shall commence to accrue on the
Closing Date and shall cease to accrue on the date on which the Commitment of
such Lender shall expire or be terminated as provided herein.
26
(b) The Borrower agrees to pay (i) to each Revolving Credit Lender,
through the Paying Agent, on the last day of March, June, September and December
of each year and on the date on which the Revolving Credit Commitment of such
Lender shall be terminated as provided herein, a fee (an "L/C Participation
Fee") calculated on such Lender's Pro Rata Percentage of the average daily
aggregate L/C Exposure (excluding the portion thereof attributable to
unreimbursed L/C Disbursements) during the preceding quarter (or shorter period
commencing with the Closing Date or ending with the Maturity Date or the date on
which all Letters of Credit have been canceled or have expired and the Revolving
Credit Commitments of all Lenders shall have been terminated) at a rate equal to
2.00% per annum, and (ii) to the Issuing Bank with respect to each Letter of
Credit the standard fronting, issuance and drawing fees specified from time to
time by the Issuing Bank (the "Issuing Bank Fees"). All L/C Participation Fees
and Issuing Bank Fees shall be computed on the basis of the actual number of
days elapsed in a year of 360 days.
(c) All Fees shall be paid on the dates due, in immediately available
funds, to the Paying Agent for distribution, if and as appropriate, among the
Lenders, except that the Issuing Bank Fees shall be paid directly to the Issuing
Bank. Once paid, none of the Fees shall be refundable under any circumstances,
absent manifest error.
SECTION 2.06. Interest on Loans. (a) Subject to the provisions of
Section 2.07, the Loans comprising each Base Rate Borrowing shall bear interest
(computed on the basis of the actual number of days elapsed over a year of 365
or 366 days, as the case may be, when the Base Rate is determined by reference
to the Prime Rate and over a year of 360 days at all other times) at a rate per
annum equal to (a) for the period from the Closing Date up to and including
December 12, 1998, the Base Rate plus 1.00% and (b) thereafter, the Base Rate
plus 1.50%.
(b) Subject to the provisions of Section 2.07, the Loans comprising
each Eurodollar Borrowing shall bear interest (computed on the basis of the
actual number of days elapsed over a year of 360 days) at a rate per annum equal
to (a) for the period from the Closing Date up to and including December 12,
1998, the Adjusted LIBO Rate for the Interest Period in effect for such
Borrowing plus 2.00% and (b) thereafter, the Adjusted LIBO Rate for the Interest
Period in effect for such Borrowing plus 2.50%.
(c) Interest on each Loan shall be payable on the Interest Payment
Dates applicable to such Loan except as otherwise provided in this Agreement.
The applicable Base Rate or Adjusted LIBO Rate for each Interest Period or day
within an Interest Period, as the case may be, shall be determined by the Paying
Agent, and such determination shall be conclusive absent manifest error.
SECTION 2.07. Default Interest. If the Borrower shall default in the
payment of the principal of or interest on any Loan or any other amount becoming
due hereunder, by acceleration or otherwise, or under any other Loan Document,
the Borrower shall on demand from time to time pay interest, to the extent
permitted by law, on such defaulted amount to but excluding the date of actual
payment (after as well as before judgment) (a) in the case of overdue principal,
at the rate otherwise applicable to such Loan pursuant to Section 2.06 plus
2.00% per annum and (b) in all other cases, at a rate per annum (computed on the
basis of the actual number of days elapsed over a year of 365 or 366 days, as
the case may be, when determined by reference to the Prime Rate and over a year
of 360 days at all other times) equal to the sum of the Base Rate plus 2.00%.
27
SECTION 2.08. Alternate Rate of Interest. In the event, and on each
occasion, that on the day two Business Days prior to the commencement of any
Interest Period for a Eurodollar Borrowing the Paying Agent shall have
determined that dollar deposits in the principal amounts of the Loans comprising
such Borrowing are not generally available in the London interbank market, or
that the rates at which such dollar deposits are being offered will not
adequately and fairly reflect the cost to the Lender or Lenders holding a
majority of the Eurodollar Loans comprising such Eurodollar Borrowing of making
or maintaining such Eurodollar Loan during such Interest Period, or that
reasonable means do not exist for ascertaining the Adjusted LIBO Rate, the
Paying Agent shall, as soon as practicable thereafter, give written or telecopy
notice of such determination to the Borrower and the Lenders. In the event of
any such determination, until the Paying Agent shall have advised the Borrower
and the Lenders that the circumstances giving rise to such notice no longer
exist, any request by the Borrower for a Eurodollar Borrowing pursuant to
Section 2.03 or 2.10 shall be deemed to be a request for a Base Rate Borrowing.
Each determination by the Paying Agent hereunder shall be conclusive absent
manifest error.
SECTION 2.09. Termination and Reduction of Commitments. (a) The Term
Loan Commitments shall automatically terminate at 5:00 p.m., New York City time,
on the Termination Date. The Revolving Credit Commitments and the L/C Commitment
shall automatically terminate on the Maturity Date. Notwithstanding the
foregoing, the Revolving Credit Commitment and the L/C Commitment shall
automatically terminate at 5:00 p.m., New York City time, on the Termination
Date if the initial Borrowing hereunder shall not have occurred by such time.
(b) Upon at least three Business Days' prior irrevocable written or
telecopy notice to the Paying Agent, the Borrower may at any time in whole
permanently terminate, or from time to time in part permanently reduce, the Term
Loan Commitments or the Revolving Credit Commitments; provided, however, that
(i) each partial reduction of the Term Loan Commitments or the Revolving Credit
Commitments shall be in an integral multiple of $1,000,000 and in a minimum
amount of $5,000,000 and (ii) the Total Revolving Credit Commitment shall not be
reduced to an amount that is less than the Aggregate Revolving Credit Exposure
at the time.
(c) Each reduction in the Term Loan Commitments or the Revolving Credit
Commitments hereunder shall be made ratably among the Lenders in accordance with
their respective applicable Commitments. The Borrower shall pay to the Paying
Agent for the account of the applicable Lenders, on the date of each termination
or reduction, the Commitment Fees on the amount of the Commitments so terminated
or reduced accrued to but excluding the date of such termination or reduction.
SECTION 2.10. Conversion and Continuation of Borrowings. The Borrower
shall have the right at any time upon prior irrevocable notice to the Paying
Agent (a) not later than 12:00 (noon), New York City time, one Business Day
prior to conversion, to convert any Eurodollar Borrowing into a Base Rate
Borrowing, (b) not later than 11:00 a.m., New York City time, three Business
Days prior to conversion or continuation, to convert any Base Rate Borrowing
into a Eurodollar Borrowing or to continue any Eurodollar Borrowing as a
Eurodollar Borrowing for an additional Interest Period, and (c) not later than
11:00 a.m., New York City time, three Business Days prior to conversion, to
28
convert the Interest Period with respect to any Eurodollar Borrowing to another
permissible Interest Period, subject in each case to the following:
(i) each conversion or continuation shall be made pro rata
among the Lenders in accordance with the respective principal amounts
of the Loans comprising the converted or continued Borrowing;
(ii) if less than all the outstanding principal amount of any
Borrowing shall be converted or continued, then each resulting
Borrowing shall satisfy the limitations specified in Sections 2.02(a)
and 2.02(b) regarding the principal amount and maximum number of
Borrowings of the relevant Type;
(iii) each conversion shall be effected by each Lender and the
Paying Agent by recording for the account of such Lender the new Loan
of such Lender resulting from such conversion and reducing the Loan (or
portion thereof) of such Lender being converted by an equivalent
principal amount; accrued interest on any Eurodollar Loan (or portion
thereof) being converted shall be paid by the Borrower at the time of
conversion;
(iv) if any Eurodollar Borrowing is converted at a time other
than the end of the Interest Period applicable thereto, the Borrower
shall pay, upon demand, any amounts due to the Lenders pursuant to
Section 2.16;
(v) any portion of a Borrowing maturing or required to be
repaid in less than one month may not be converted into or continued as
a Eurodollar Borrowing;
(vi) any portion of a Eurodollar Borrowing that cannot be
converted into or continued as a Eurodollar Borrowing by reason of the
immediately preceding clause shall be automatically converted at the
end of the Interest Period in effect for such Borrowing into a Base
Rate Borrowing; and
(vii) upon notice to the Borrower from the Paying Agent given
at the request of the Required Lenders, after the occurrence and during
the continuance of a Default or an Event of Default, no outstanding
Loan may be converted into, or continued as, a Eurodollar Loan.
Each notice pursuant to this Section 2.10 shall be irrevocable and
shall refer to this Agreement and specify (i) the identity and amount of the
Borrowing that the Borrower requests be converted or continued, (ii) whether
such Borrowing is to be converted to or continued as a Eurodollar Borrowing or a
Base Rate Borrowing, (iii) if such notice requests a conversion, the date of
such conversion (which shall be a Business Day) and (iv) if such Borrowing is to
be converted to or continued as a Eurodollar Borrowing, the Interest Period with
respect thereto. If no Interest Period is specified in any such notice with
respect to any conversion to or continuation as a Eurodollar Borrowing, the
Borrower shall be deemed to have selected an Interest Period of one month's
duration. The Paying Agent shall advise the Lenders of any notice given pursuant
to this Section 2.10 and of each Lender's portion of any converted or continued
Borrowing. If the Borrower shall not have given notice in accordance with this
Section 2.10 to continue any Borrowing into a subsequent Interest Period (and
shall not otherwise have given notice in accordance with this Section 2.10 to
convert such Borrowing), such Borrowing shall, at the end of the Interest Period
applicable thereto (unless repaid
29
pursuant to the terms hereof), automatically be continued into a new Interest
Period as a Base Rate Borrowing.
SECTION 2.11. Repayment of Term Borrowings. (a) To the extent not
previously paid, all Term Loans shall be due and payable on the Maturity Date
together with accrued and unpaid interest on the principal amount to be paid to
but excluding the date of payment.
(b) All repayments pursuant to this Section 2.11 shall be subject to
Section 2.16, but shall otherwise be without premium or penalty.
SECTION 2.12. Optional Prepayments. (a) The Borrower shall have the
right at any time and from time to time to prepay any Borrowing, in whole or in
part, upon at least three Business Days' prior written or telecopy notice (or
telephone notice promptly confirmed by written or telecopy notice) to the Paying
Agent before 11:00 a.m., New York City time; provided, however, that each
partial prepayment shall be in an amount that is an integral multiple of
$1,000,000 and not less than $5,000,000.
(b) Each notice of prepayment shall specify the prepayment date and the
principal amount of each Borrowing (or portion thereof) to be prepaid, shall be
irrevocable and shall commit the Borrower to prepay such Borrowing by the amount
stated therein on the date stated therein. All prepayments under this Section
2.12 shall be subject to Section 2.16 but otherwise without premium or penalty.
All prepayments under this Section 2.12 shall be accompanied by accrued interest
on the principal amount being prepaid to the date of payment.
SECTION 2.13. Mandatory Prepayments. (a) In the event of any
termination of all the Revolving Credit Commitments, the Borrower shall repay or
prepay all its outstanding Revolving Credit Borrowings on the date of such
termination. In the event of any partial reduction of the Revolving Credit
Commitments, then (i) at or prior to the effective date of such reduction, the
Paying Agent shall notify the Borrower and the Revolving Credit Lenders of the
Aggregate Revolving Credit Exposure after giving effect thereto and (ii) if the
Aggregate Revolving Credit Exposure would exceed the Total Revolving Credit
Commitment after giving effect to such reduction or termination, then the
Borrower shall, on the date of such reduction or termination, repay or prepay
Revolving Credit Borrowings in an amount sufficient to eliminate such excess.
(b) Not later than the fourth Business Day following the receipt of Net
Cash Proceeds from any Asset Sale (except to the extent the Borrower has
notified the Paying Agent of its intention to reinvest the proceeds thereof in
accordance with the definition of the term "Net Cash Proceeds" and such proceeds
are in fact so reinvested within the 180-day period referred to in such
definition), the Borrower or the applicable Restricted Subsidiary shall apply
100% of such Net Cash Proceeds received with respect thereto to prepay
outstanding Term Loans.
(c) In the event and on each occasion that an Equity Issuance occurs,
the Borrower shall, substantially simultaneously with (and in any event not
later than the fourth Business Day next following) the receipt of Net Cash
Proceeds from any such Equity Issuance, apply 100% of such Net Cash Proceeds to
prepay outstanding Term Loans.
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(d) In the event that the Borrower or any Restricted Subsidiary shall
receive Net Cash Proceeds from the issuance or other disposition of Indebtedness
for money borrowed of the Borrower or any Restricted Subsidiary (other than
Indebtedness permitted by Section 6.01), the Borrower shall, substantially
simultaneously with (and in any event not later than the fourth Business Day
next following) the receipt of such Net Cash Proceeds by the Borrower or such
Restricted Subsidiary, apply an amount equal to 100% of such Net Cash Proceeds
to prepay outstanding Term Loans.
(e) The Borrower shall deliver to the Paying Agent, at the time of each
prepayment required under this Section 2.13, (i) a certificate signed by a
Financial Officer of the Borrower setting forth in reasonable detail the
calculation of the amount of such prepayment and (ii) to the extent practicable,
at least four days' prior written notice of such prepayment. Each notice of
prepayment shall specify the prepayment date, the Type of each Loan being
prepaid and the principal amount of each Loan (or portion thereof) to be
prepaid. All prepayments of Borrowings under this Section 2.13 shall be subject
to Section 2.16, but shall otherwise be without premium or penalty.
(f) Amounts to be applied pursuant to this Section 2.13 to the
prepayment of Term Loans and Revolving Loans shall be applied, as applicable,
first to reduce outstanding Base Rate Term Loans and Base Rate Revolving Loans.
Any amounts remaining after each such application shall, at the option of the
Borrower, be applied to prepay Eurodollar Term Loans or Eurodollar Revolving
Loans, as the case may be, immediately and/or shall be deposited in the
Prepayment Account (as defined below). The Paying Agent shall apply any cash
deposited in the Prepayment Account (i) allocable to Term Loans to prepay
Eurodollar Term Loans and (ii) allocable to Revolving Loans to prepay Eurodollar
Revolving Loans, in each case on the last day of their respective Interest
Periods (or, at the direction of the Borrower, on any earlier date) until all
outstanding Term Loans or Revolving Loans, as the case may be, have been prepaid
or until all the allocable cash on deposit with respect to such Loans has been
exhausted. For purposes of this Agreement, the term "Prepayment Account" shall
mean an account established by the Borrower with the Paying Agent and over which
the Paying Agent shall have exclusive dominion and control, including the
exclusive right of withdrawal for application in accordance with this paragraph
(f). The Paying Agent will, at the request of the Borrower, invest amounts on
deposit in the Prepayment Account in Permitted Investments that mature prior to
the last day of the applicable Interest Periods of the Eurodollar Term
Borrowings or Eurodollar Revolving Borrowings to be prepaid, as the case may be;
provided, however, that (i) the Paying Agent shall not be required to make any
investment that, in its sole judgment, would require or cause the Paying Agent
to be in, or would result in any, violation of any law, statute, rule or
regulation and (ii) the Paying Agent shall have no obligation to invest amounts
on deposit in the Prepayment Account if an Event of Default shall have occurred
and be continuing. The Borrower shall indemnify the Paying Agent for any losses
relating to the investments so that the amount available to prepay Eurodollar
Borrowings on the last day of the applicable Interest Period is not less than
the amount that would have been available had no investments been made pursuant
thereto. Other than any interest earned on such investments, the Prepayment
Account shall not bear interest. Interest or profits, if any, on such
investments shall be deposited in the Prepayment Account and reinvested and
disbursed as specified above. If the maturity of the Loans has been accelerated
pursuant to Article VII, the Paying Agent may, in its sole discretion, apply all
amounts on deposit in the Prepayment Account to satisfy any of the Obligations.
The Borrower hereby grants to the Paying Agent, for its benefit and the benefit
of the Issuing Bank and the Lenders, a security interest in the Prepayment
Account to secure the Obligations.
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SECTION 2.14. Reserve Requirements; Change in Circumstances. (a)
Notwithstanding any other provision of this Agreement, if after the date of this
Agreement any change in applicable law or regulation or in the interpretation or
administration thereof by any Governmental Authority charged with the
interpretation or administration thereof (whether or not having the force of
law) shall impose, modify or deem applicable any reserve, special deposit or
similar requirement against assets of, deposits with or for the account of or
credit extended by any Lender or the Issuing Bank (except any such reserve
requirement which is reflected in the Adjusted LIBO Rate) or shall impose on
such Lender or the Issuing Bank or the London interbank market any other
condition affecting this Agreement or Eurodollar Loans made by such Lender or
any Letter of Credit or participation therein, and the result of any of the
foregoing shall be to increase the cost to such Lender or the Issuing Bank of
making or maintaining any Eurodollar Loan or increase the cost to any Lender of
issuing or maintaining any Letter of Credit or purchasing or maintaining a
participation therein or to reduce the amount of any sum received or receivable
by such Lender or the Issuing Bank hereunder (whether of principal, interest or
otherwise) by an amount deemed by such Lender or the Issuing Bank to be
material, then the Borrower will pay to such Lender or the Issuing Bank, as the
case may be, upon demand, such additional amount or amounts as will compensate
such Lender or the Issuing Bank, as the case may be, for such additional costs
incurred or reduction suffered.
(b) If any Lender or the Issuing Bank shall have determined that the
adoption after the Closing Date of any law, rule, regulation, agreement or
guideline regarding capital adequacy, or any change after the Closing Date in
any such law, rule, regulation, agreement or guideline (whether or not having
the force of law) or in the interpretation or administration thereof by any
Governmental Authority charged with the interpretation or administration
thereof, or compliance by any Lender (or any lending office of such Lender) or
the Issuing Bank or any Lender's or the Issuing Bank's holding company with any
request or directive regarding capital adequacy (whether or not having the force
of law) of any Governmental Authority made or issued after the Closing Date has
or would have the effect of reducing the rate of return on such Lender's or the
Issuing Bank's capital or on the capital of such Lender's or the Issuing Bank's
holding company, if any, as a consequence of this Agreement or the Loans made or
participations in Letters of Credit purchased by such Lender pursuant hereto or
the Letters of Credit issued by the Issuing Bank pursuant hereto to a level
below that which such Lender or the Issuing Bank or such Lender's or the Issuing
Bank's holding company could have achieved but for such applicability, adoption,
change or compliance (taking into consideration such Lender's or the Issuing
Bank's policies and the policies of such Lender's or the Issuing Bank's holding
company with respect to capital adequacy) by an amount deemed by such Lender or
the Issuing Bank to be material, then from time to time the Borrower shall pay
to such Lender or the Issuing Bank, as the case may be, such additional amount
or amounts as will compensate such Lender or the Issuing Bank or such Lender's
or the Issuing Bank's holding company for any such reduction suffered.
(c) A certificate of a Lender or the Issuing Bank setting forth the
amount or amounts necessary to compensate such Lender or the Issuing Bank or its
respective holding company, as applicable, as specified in paragraph (a) or (b)
above shall be delivered to the Borrower and shall be conclusive absent manifest
error. The Borrower shall pay such Lender or the Issuing Bank the amount shown
as due on any such certificate delivered by it within 10 days after its receipt
of the same.
(d) Failure or delay on the part of any Lender or the Issuing Bank to
demand compensation for any increased costs or reduction in amounts received or
receivable or reduction in return on capital
32
shall not constitute a waiver of such Lender's or the Issuing Bank's right to
demand such compensation; provided that neither any Lender nor the Issuing Bank
shall be entitled to compensation under this Section 2.14 for any increased
costs or reductions incurred or suffered with respect to any date unless such
Lender or the Issuing Bank, as the case may be, shall have notified the Borrower
under paragraph (c) above, not more than 90 days after the later of (i) such
date and (ii) the date on which such Lender or Issuing Bank, as applicable,
shall have become aware of such costs or reductions. The protection of this
Section shall be available to each Lender and the Issuing Bank regardless of any
possible contention of the invalidity or inapplicability of the law, rule,
regulation, agreement, guideline or other change or condition that shall have
occurred or been imposed.
SECTION 2.15. Change in Legality. (a) Notwithstanding any other
provision of this Agreement, if, after the Closing Date, any change in any law
or regulation or in the interpretation thereof by any Governmental Authority
charged with the administration or interpretation thereof shall make it unlawful
for any Lender to make or maintain any Eurodollar Loan or to give effect to its
obligations as contemplated hereby with respect to any Eurodollar Loan, then, by
written notice to the Borrower and to the Paying Agent:
(i) such Lender may declare that Eurodollar Loans will not
thereafter (for the duration of such unlawfulness) be made by such
Lender hereunder (or be continued for additional Interest Periods and
Base Rate Loans will not thereafter (for such duration) be converted
into Eurodollar Loans), whereupon any request for a Eurodollar
Borrowing (or to convert a Base Rate Borrowing to a Eurodollar
Borrowing or to continue a Eurodollar Borrowing for an additional
Interest Period) shall, as to such Lender only, be deemed a request for
a Base Rate Loan (or a request to continue a Base Rate Loan as such for
an additional Interest Period or to convert a Eurodollar Loan into a
Base Rate Loan, as the case may be) unless such declaration shall be
subsequently withdrawn; and
(ii) such Lender may require that all outstanding Eurodollar
Loans made by it be converted to Base Rate Loans, in which event all
such Eurodollar Loans shall be automatically converted to Base Rate
Loans as of the effective date of such notice as provided in paragraph
(b) below.
In the event any Lender shall exercise its rights under (i) or (ii) above, all
payments and prepayments of principal that would otherwise have been applied to
repay the Eurodollar Loans that would have been made by such Lender or the
converted Eurodollar Loans of such Lender shall instead be applied to repay the
Base Rate Loans made by such Lender in lieu of, or resulting from the conversion
of, such Eurodollar Loans.
(b) For purposes of this Section 2.15, a notice to the Borrower by any
Lender shall be effective as to each Eurodollar Loan made by such Lender, if
lawful, on the last day of the Interest Period currently applicable to such
Eurodollar Loan; in all other cases such notice shall be effective on the date
of receipt by the Borrower.
SECTION 2.16. Indemnity. The Borrower shall indemnify each Lender
against any loss or expense that such Lender may sustain or incur as a
consequence of any event, other than a default by such Lender in the performance
of its obligations hereunder, which results in (a) such Lender receiving or
being deemed to receive any amount on account of the principal of any Eurodollar
Loan
33
prior to the end of the Interest Period in effect therefor, (b) the conversion
of any Eurodollar Loan to a Base Rate Loan, or the conversion of the Interest
Period with respect to any Eurodollar Loan, in each case other than on the last
day of the Interest Period in effect therefor, or (c) any Eurodollar Loan to be
made by such Lender (including any Eurodollar Loan to be made pursuant to a
conversion or continuation under Section 2.10) not being made after notice of
such Loan shall have been given by the Borrower hereunder (any of the events
referred to in this sentence being called a "Breakage Event") . In the case of
any Breakage Event, such loss shall include an amount equal to the excess, as
reasonably determined by such Lender, of (i) its cost of obtaining funds for the
Eurodollar Loan (excluding loss of margin) that is the subject of such Breakage
Event for the period from the date of such Breakage Event to the last day of the
Interest Period in effect (or that would have been in effect) for such Loan over
(ii) the amount of interest likely to be realized by such Lender in redeploying
the funds released or not utilized by reason of such Breakage Event for such
period. A certificate of any Lender setting forth any amount or amounts which
such Lender is entitled to receive pursuant to this Section 2.16 shall be
delivered to the Borrower and shall be conclusive absent manifest error.
SECTION 2.17. Pro Rata Treatment. Except as required under Section
2.15, each Borrowing, each payment or prepayment of principal of any Borrowing,
each payment of interest on the Loans, each payment of the Commitment Fees, each
reduction of the Term Loan Commitments or the Revolving Credit Commitments and
each conversion of any Borrowing to or continuation of any Borrowing as a
Borrowing of any Type shall be allocated pro rata among the Lenders in
accordance with their respective applicable Commitments (or, if such Commitments
shall have expired or been terminated, in accordance with the respective
principal amounts of their outstanding Loans). Each Lender agrees that in
computing such Lender's portion of any Borrowing to be made hereunder, the
Paying Agent may, in its discretion, round each Lender's percentage of such
Borrowing to the next higher or lower whole dollar amount.
SECTION 2.18. Sharing of Setoffs. Each Lender agrees that if it shall,
through the exercise of a right of banker's lien, setoff or counterclaim against
the Borrower, or pursuant to a secured claim under Section 506 of Title 11 of
the United States Code or other security or interest arising from, or in lieu
of, such secured claim, received by such Lender under any applicable bankruptcy,
insolvency or other similar law or otherwise, or by any other means, obtain
payment (voluntary or involuntary) in respect of any Loan or Loans or L/C
Disbursement as a result of which the unpaid principal portion of its Term Loans
and Revolving Loans and participations in L/C Disbursements shall be
proportionately less than the unpaid principal portion of the Term Loans and
Revolving Loans and participations in L/C Disbursements of any other Lender, it
shall be deemed simultaneously to have purchased from such other Lender at face
value, and shall promptly pay to such other Lender the purchase price for, a
participation in the Term Loans and Revolving Loans and L/C Exposure, as the
case may be, of such other Lender, so that the aggregate unpaid principal amount
of the Term Loans and Revolving Loans and L/C Exposure and participations in
Term Loans and Revolving Loans and L/C Exposure held by each Lender shall be in
the same proportion to the aggregate unpaid principal amount of all Term Loans
and Revolving Loans and L/C Exposure then outstanding as the principal amount of
its Term Loans and Revolving Loans and L/C Exposure prior to such exercise of
banker's lien, setoff or counterclaim or other event was to the principal amount
of all Term Loans and Revolving Loans and L/C Exposure outstanding prior to such
exercise of banker's lien, setoff or counterclaim or other event; provided,
however, that if any such purchase or purchases or adjustments shall be made
pursuant to this Section 2.18 and the payment giving rise thereto shall
thereafter be recovered, such purchase or purchases or adjustments shall be
rescinded to the extent of such recovery
34
and the purchase price or prices or adjustment restored without interest. The
Borrower expressly consents to the foregoing arrangements and agrees that any
Lender holding a participation in a Term Loan or Revolving Loan or L/C
Disbursement deemed to have been so purchased may exercise any and all rights of
banker's lien, setoff or counterclaim with respect to any and all moneys owing
by the Borrower to such Lender by reason thereof as fully as if such Lender had
made a Loan directly to the Borrower in the amount of such participation.
SECTION 2.19. Payments. (a) The Borrower shall make each payment
(including principal of or interest on any Borrowing or any L/C Disbursement or
any Fees or other amounts) hereunder and under any other Loan Document not later
than 12:00 (noon), New York City time, on the date when due in immediately
available dollars, without setoff, defense or counterclaim. Each such payment
(other than Issuing Bank Fees, which shall be paid directly to the Issuing Bank)
shall be made to the Paying Agent at its offices at 000 Xxxx Xxxxxx, Xxx Xxxx,
Xxx Xxxx.
(b) Whenever any payment (including principal of or interest on any
Borrowing or any Fees or other amounts) hereunder or under any other Loan
Document shall become due, or otherwise would occur, on a day that is not a
Business Day, such payment may be made on the next succeeding Business Day, and
such extension of time shall in such case be included in the computation of
interest or Fees, if applicable.
SECTION 2.20. Taxes. (a) Any and all payments by the Borrower hereunder
and under any other Loan Document shall be made, in accordance with Section
2.19, free and clear of and without deduction for any and all current or future
taxes, levies, imposts, deductions, charges or withholdings imposed by the
United Kingdom, the United States or any political subdivision thereof, and all
liabilities with respect thereto, excluding all taxes, levies, imposts,
deductions, charges or withholdings imposed by reason of the Paying Agent or
Lender or Issuing Bank (or any transferee or assignee thereof including a
participation holder (any such entity, a "Transferee")), as the case may be,
doing business or being regulated, organized, managed, controlled or having a
lending office in the jurisdiction imposing such tax, other than solely as a
result of this Agreement or any other Loan Document or any transaction
contemplated hereby (all such nonexcluded taxes, levies, imposts, deductions,
charges, withholdings and liabilities, collectively or individually, being
called "Taxes"). If the Borrower shall be required to deduct any Taxes from or
in respect of any sum payable hereunder or under any other Loan Document to the
Paying Agent or any Lender or the Issuing Bank (or any Transferee), (i) the sum
payable shall be increased by the amount (an "additional amount") necessary so
that after making all required deductions (including deductions applicable to
additional sums payable under this Section 2.20) the Paying Agent or such Lender
or the Issuing Bank (or Transferee), as the case may be, shall receive an amount
equal to the sum it would have received had no such deductions been made, (ii)
the Borrower shall make such deductions and (iii) the Borrower shall pay the
full amount deducted to the relevant Governmental Authority in accordance with
applicable law.
(b) In addition, the Borrower agrees to pay to the relevant
Governmental Authority of the United Kingdom, the United States or any political
subdivision thereof in accordance with applicable law any current or future
stamp or documentary taxes or any other excise or property taxes, charges or
similar levies that arise from any payment made hereunder or under any other
Loan Document or from the execution, delivery or registration of, or otherwise
with respect to, this Agreement or any other Loan Document ("Other Taxes").
35
(c) The Borrower will indemnify the Paying Agent, each Lender and the
Issuing Bank (or Transferee) for the full amount of Taxes and Other Taxes paid
by the Paying Agent, such Lender or the Issuing Bank (or Transferee), as the
case may be, and any liability (including penalties, interest and expenses
(including reasonable attorney's fees and expenses)) arising therefrom or with
respect thereto, whether or not such Taxes or Other Taxes were correctly or
legally asserted by the relevant Governmental Authority. A certificate as to the
amount of such payment or liability prepared by the Paying Agent, a Lender or
the Issuing Bank (or Transferee), or the Paying Agent on its behalf, absent
manifest error, shall be final, conclusive and binding for all purposes. Such
indemnification shall be made within 30 days after the date the Paying Agent or
any Lender or the Issuing Bank (or Transferee), as the case may be, makes
written demand therefor.
(d) As soon as practicable after the date of any payment of Taxes or
Other Taxes by the Borrower to the relevant Governmental Authority, the Borrower
will deliver to the Paying Agent, at its address referred to in Section 9.01 to
the extent legally available, the original or a certified copy of a receipt
issued by such Governmental Authority evidencing payment thereof.
(e) Each Lender (or Transferee) that is organized under the laws of a
jurisdiction other than the United States, any State thereof or the District of
Columbia (a "Non-U.S. Lender") shall deliver to the Borrower and the Paying
Agent two copies of either United States Internal Revenue Service Form 1001 or
Form 4224, or, in the case of a Non-U.S. Lender claiming exemption from U.S.
Federal withholding tax under Section 871(h) or 881(c) of the Code with respect
to payments of "portfolio interest", a Form W-8, or any subsequent versions
thereof or successors thereto (and, if such Non-U.S. Lender delivers a Form W-8,
a certificate representing that such Non-U.S. Lender is not a bank for purposes
of Section 881(c) of the Code, is not a 10-percent shareholder (within the
meaning of Section 871(h)(3)(B) of the Code) of the Borrower and is not a
controlled foreign corporation related to the Borrower (within the meaning of
Section 864(d)(4) of the Code)), properly completed and duly executed by such
Non-U.S. Lender claiming complete exemption from, or reduced rate of, U.S.
Federal withholding tax on payments by the Borrower under this Agreement and the
other Loan Documents. Such forms shall be delivered by each Non-U.S. Lender on
or before the date it becomes a party to this Agreement (or, in the case of a
Transferee that is a participation holder, on or before the date such
participation holder becomes a Transferee hereunder) and on or before the date,
if any, such Non-U.S. Lender changes its applicable lending office by
designating a different lending office (a "New Lending Office") . In addition,
each Non-U.S. Lender shall deliver such forms promptly upon the obsolescence or
invalidity of any form previously delivered by such Non-U.S. Lender.
Notwithstanding any other provision of this Section 2.20(e), a Non-U.S. Lender
shall not be required to deliver any form pursuant to this Section 2.20(e) that
such Non-U.S. Lender is not legally able to deliver.
(f) The Borrower shall not be required to indemnify any Non-U.S. Lender
or to pay any additional amounts to any Non-U.S. Lender, in respect of United
States Federal withholding tax pursuant to paragraph (a) or (c) above to the
extent that (i) the obligation to withhold amounts with respect to United States
Federal withholding tax existed on the date such Non-U.S. Lender became a party
to this Agreement (or, in the case of a Transferee that is a participation
holder, on the date such participation holder became a Transferee hereunder) or,
with respect to payments to a New Lending Office, the date such Non-U.S. Lender
designated such New Lending Office with respect to a Loan; provided, however,
that this paragraph (f) shall not apply (x) to any Transferee or New Lending
Office that becomes a Transferee or New Lending Office as a result of an
assignment, participation, transfer
36
or designation made at the request of the Borrower and (y) to the extent the
indemnity payment or additional amounts any Transferee, or any Lender (or
Transferee), acting through a New Lending Office, would be entitled to receive
(without regard to this paragraph (f)) do not exceed the indemnity payment or
additional amounts that the person making the assignment, participation or
transfer to such Transferee, or Lender (or Transferee) making the designation of
such New Lending Office, would have been entitled to receive in the absence of
such assignment, participation, transfer or designation or (ii) the obligation
to pay such additional amounts would not have arisen but for a failure by such
Non-U.S. Lender to comply with the provisions of paragraph (e) above.
(g) Nothing contained in this Section 2.20 shall require any Lender or
the Issuing Bank (or any Transferee) or the Paying Agent to make available any
of its tax returns (or any other information that it deems to be confidential or
proprietary).
SECTION 2.21. Assignment of Commitments Under Certain Circumstances;
Duty to Mitigate. (a) In the event (i) any Lender or the Issuing Bank delivers a
certificate requesting compensation pursuant to Section 2.14, (ii) any Lender or
the Issuing Bank delivers a notice described in Section 2.15 or (iii) the
Borrower is required to pay any additional amount to any Lender or the Issuing
Bank or any Governmental Authority on account of any Lender or the Issuing Bank
pursuant to Section 2.20, the Borrower may, at its sole expense and effort
(including with respect to the processing and recordation fee referred to in
Section 9.04(b)), upon notice to such Lender or the Issuing Bank and the Paying
Agent, require such Lender or the Issuing Bank to transfer and assign, without
recourse (in accordance with and subject to the restrictions contained in
Section 9.04), all of its interests, rights and obligations under this Agreement
to an assignee that shall assume such assigned obligations (which assignee may
be another Lender, if a Lender accepts such assignment); provided that (x) such
assignment shall not conflict with any law, rule or regulation or order of any
court or other Governmental Authority having jurisdiction, (y) the Borrower
shall have received the prior written consent of the Paying Agent (and, if a
Revolving Credit Commitment is being assigned, of the Issuing Bank), which
consent shall not unreasonably be withheld, and (z) the Borrower or such
assignee shall have paid to the affected Lender or the Issuing Bank in
immediately available funds an amount equal to the sum of the principal of and
interest accrued to the date of such payment on the outstanding Loans or L/C
Disbursements of such Lender or the Issuing Bank, respectively, plus all Fees
and other amounts accrued for the account of such Lender or the Issuing Bank
hereunder (including any amounts under Section 2.14 and Section 2.16); provided
further that, if prior to any such transfer and assignment the circumstances or
event that resulted in such Lender's or the Issuing Bank's claim for
compensation under Section 2.14 or notice under Section 2.15 or the amounts paid
pursuant to Section 2.20, as the case may be, cease to cause such Lender or the
Issuing Bank to suffer increased costs or reductions in amounts received or
receivable or reduction in return on capital, or cease to have the consequences
specified in Section 2.15, or cease to result in amounts being payable under
Section 2.20, as the case may be (including as a result of any action taken by
such Lender or the Issuing Bank pursuant to paragraph (b) below), or if such
Lender or the Issuing Bank shall waive its right to claim further compensation
under Section 2.14 in respect of such circumstances or event or shall withdraw
its notice under Section 2.15 or shall waive its right to further payments under
Section 2.20 in respect of such circumstances or event, as the case may be, then
such Lender or the Issuing Bank shall not thereafter be required to make any
such transfer and assignment hereunder.
(b) If (i) any Lender or the Issuing Bank shall request compensation
under Section 2.14, (ii) any Lender or the Issuing Bank delivers a notice
described in Section 2.15 or (iii) the Borrower
37
is required to pay any additional amount to any Lender or the Issuing Bank or
any Governmental Authority on account of any Lender or the Issuing Bank,
pursuant to Section 2.20, then such Lender or the Issuing Bank shall use
reasonable efforts (which shall not require such Lender or the Issuing Bank to
incur an unreimbursed loss or unreimbursed cost or expense or otherwise take any
action inconsistent with its internal policies or legal or regulatory
restrictions or suffer any disadvantage or burden deemed by it to be
significant) (x) to file any certificate or document reasonably requested in
writing by the Borrower or (y) to assign its rights and delegate and transfer
its obligations hereunder to another of its offices, branches or affiliates, if
such filing or assignment would reduce its claims for compensation under Section
2.14 or enable it to withdraw its notice pursuant to Section 2.15 or would
reduce amounts payable pursuant to Section 2.20, as the case may be, in the
future. The Borrower hereby agrees to pay all reasonable costs and expenses
incurred by any Lender or the Issuing Bank in connection with any such filing or
assignment, delegation and transfer.
SECTION 2.22. Letters of Credit. (a) General. The Borrower may request
the issuance of a Letter of Credit for its own account, for the account of any
Restricted Subsidiary or for the account of PFS or any subsidiary thereof
(provided that the Borrower shall be a co-applicant and co-obligor with respect
to each Letter of Credit issued for the account of or in favor of any such
Restricted Subsidiary, PFS or any subsidiary thereof), in a form reasonably
acceptable to the Paying Agent and the Issuing Bank, at any time and from time
to time while the Revolving Credit Commitments remain in effect. This Section
shall not be construed to impose an obligation upon the Issuing Bank to issue
any Letter of Credit that is inconsistent with the terms and conditions of this
Agreement.
(b) Notice of Issuance, Amendment, Renewal, Extension; Certain
Conditions. In order to request the issuance of a Letter of Credit (or to amend,
renew or extend an existing Letter of Credit), the Borrower shall hand deliver
or telecopy to the Issuing Bank and the Paying Agent (reasonably in advance of
the requested date of issuance, amendment, renewal or extension) a notice
requesting the issuance of a Letter of Credit, or identifying the Letter of
Credit to be amended, renewed or extended, the date of issuance, amendment,
renewal or extension, the date on which such Letter of Credit is to expire
(which shall comply with paragraph (c) below), the amount of such Letter of
Credit, the name and address of the beneficiary thereof and such other
information as shall be necessary to prepare such Letter of Credit. A Letter of
Credit shall be issued, amended, renewed or extended only if, and upon issuance,
amendment, renewal or extension of each Letter of Credit, the Borrower shall be
deemed to represent and warrant that, after giving effect to such issuance,
amendment, renewal or extension (A) the L/C Exposure shall not exceed
$85,000,000 and (B) the Aggregate Revolving Credit Exposure shall not exceed the
Total Revolving Credit Commitment.
(c) Expiration Date. Each Letter of Credit shall expire at the close of
business on the earlier of the date one year after the date of the issuance,
renewal or extension, as applicable, of such Letter of Credit and the date that
is five Business Days prior to the Maturity Date, unless such Letter of Credit
expires by its terms on an earlier date. Each Letter of Credit may, upon the
request of the Borrower, include a provision whereby such Letter of Credit shall
be renewed automatically for additional consecutive periods of 12 months or less
(but not beyond the date that is five Business Days prior to the Maturity Date)
unless the Issuing Bank notifies the beneficiary thereof at least 30 days prior
to the then-applicable expiration date that such Letter of Credit will not be
renewed.
(d) Participations. By the issuance of a Letter of Credit and without
any further action on the part of the Issuing Bank or the Lenders, the Issuing
Bank hereby grants to each Revolving Credit
38
Lender, and each such Lender hereby acquires from the applicable Issuing Bank, a
participation in such Letter of Credit equal to such Lender's Pro Rata
Percentage of the aggregate amount available to be drawn under such Letter of
Credit, effective upon the issuance of such Letter of Credit. In consideration
and in furtherance of the foregoing, each Revolving Credit Lender hereby
absolutely and unconditionally agrees to pay to the Paying Agent, for the
account of the Issuing Bank, such Lender's Pro Rata Percentage of each L/C
Disbursement made by the Issuing Bank and not reimbursed by the Borrower (or, if
applicable, another party pursuant to its obligations under any other Loan
Document) forthwith on the date due as provided in Section 2.02(f). Each
Revolving Credit Lender acknowledges and agrees that its obligation to acquire
participations pursuant to this paragraph in respect of Letters of Credit is
absolute and unconditional and shall not be affected by any circumstance
whatsoever, including the occurrence and continuance of a Default or an Event of
Default, and that each such payment shall be made without any offset, abatement,
withholding or reduction whatsoever.
(e) Reimbursement. If the Issuing Bank shall make any L/C Disbursement
in respect of a Letter of Credit, the Borrower shall pay to the Paying Agent an
amount equal to such L/C Disbursement not later than 2:00 p.m. on the day that
the Borrower shall have received notice from the Issuing Bank of such L/C
Disbursement, or, if the Borrower shall have received such notice later than
10:00 a.m., New York City time, on any Business Day, not later than 10:00 a.m.,
New York City time, on the immediately following Business Day.
(f) Obligations Absolute. The Borrower's obligations to reimburse L/C
Disbursements as provided in paragraph (e) above shall be absolute,
unconditional and irrevocable, and shall be performed strictly in accordance
with the terms of this Agreement, under any and all circumstances whatsoever,
and irrespective of:
(i) any lack of validity or enforceability of any Letter of
Credit or any Loan Document, or any term or provision therein;
(ii) any amendment or waiver of or any consent to departure
from all or any of the provisions of any Letter of Credit or any Loan
Document;
(iii) the existence of any claim, setoff, defense or other
right that the Borrower, any other party guaranteeing, or otherwise
obligated with, the Borrower, any Restricted Subsidiary or other
Affiliate thereof or any other person may at any time have against the
beneficiary under any Letter of Credit, the Issuing Bank, the Paying
Agent or any Lender or any other person, whether in connection with
this Agreement, any other Loan Document or any other related or
unrelated agreement or transaction;
(iv) any draft or other document presented under a Letter of
Credit proving to be forged, fraudulent, invalid or insufficient in any
respect or any statement therein being untrue or inaccurate in any
respect;
(v) payment by the Issuing Bank under a Letter of Credit
against presentation of a draft or other document that does not comply
with the terms of such Letter of Credit; and
39
(vi) any other act or omission to act or delay of any kind of
the Issuing Bank, the Lenders, the Paying Agent or any other person or
any other event or circumstance whatsoever, whether or not similar to
any of the foregoing, that might, but for the provisions of this
Section, constitute a legal or equitable discharge of the Borrower's
obligations hereunder.
Without limiting the generality of the foregoing, it is expressly
understood and agreed that the absolute and unconditional obligation of the
Borrower hereunder to reimburse L/C Disbursements will not be excused by the
gross negligence or wilful misconduct of the Issuing Bank. However, the
foregoing shall not be construed to excuse the Issuing Bank from liability to
the Borrower to the extent of any direct damages (as opposed to consequential
damages, claims in respect of which are hereby waived by the Borrower to the
extent permitted by applicable law) suffered by the Borrower that are caused by
the Issuing Bank's gross negligence or wilful misconduct in determining whether
drafts and other documents presented under a Letter of Credit comply with the
terms thereof; it is understood that the Issuing Bank may accept documents that
appear on their face to be in order, without responsibility for further
investigation, regardless of any notice or information to the contrary and, in
making any payment under any Letter of Credit (i) the Issuing Bank's exclusive
reliance on the documents presented to it under such Letter of Credit as to any
and all matters set forth therein, including reliance on the amount of any draft
presented under such Letter of Credit, whether or not the amount due to the
beneficiary thereunder equals the amount of such draft and whether or not any
document presented pursuant to such Letter of Credit proves to be insufficient
in any respect, if such document on its face appears to be in order, and whether
or not any other statement or any other document presented pursuant to such
Letter of Credit proves to be forged or invalid or any statement therein proves
to be inaccurate or untrue in any respect whatsoever and (ii) any noncompliance
in any immaterial respect of the documents presented under such Letter of Credit
with the terms thereof shall, in each case, be deemed not to constitute wilful
misconduct or gross negligence of the Issuing Bank.
(g) Disbursement Procedures. The Issuing Bank shall, promptly following
its receipt thereof, examine all documents purporting to represent a demand for
payment under a Letter of Credit. The Issuing Bank shall as promptly as possible
give telephonic notification, confirmed by telecopy, to the Paying Agent and the
Borrower of such demand for payment and whether the Issuing Bank has made or
will make an L/C Disbursement thereunder; provided that any failure to give or
delay in giving such notice shall not relieve the Borrower of its obligation to
reimburse the Issuing Bank and the Revolving Credit Lenders with respect to any
such L/C Disbursement in accordance with paragraph (e) above. The Paying Agent
shall promptly give each Revolving Credit Lender notice thereof.
(h) Interim Interest. If the Issuing Bank shall make any L/C
Disbursement in respect of a Letter of Credit, then, unless the Borrower shall
reimburse such L/C Disbursement in full on such date, the unpaid amount thereof
shall bear interest for the account of the Issuing Bank, for each day from and
including the date of such L/C Disbursement, to but excluding the earlier of the
date of payment by the Borrower or the date on which interest shall commence to
accrue thereon as provided in Section 2.02(f), at the rate per annum that would
apply to such amount if such amount were a Base Rate Loan.
40
(i) Resignation or Removal of the Issuing Bank. The Issuing Bank may
resign at any time by giving 180 days' prior written notice to the Paying Agent,
the Lenders and the Borrower, and may be removed at any time by the Borrower by
notice to the Issuing Bank, the Paying Agent and the Lenders. Upon the
acceptance of any appointment as the Issuing Bank hereunder by a Lender that
shall agree to serve as successor Issuing Bank, such successor shall succeed to
and become vested with all the interests, rights and obligations of the retiring
Issuing Bank and the retiring Issuing Bank shall be discharged from its
obligations to issue additional Letters of Credit hereunder. At the time such
removal or resignation shall become effective, the Borrower shall pay all
accrued and unpaid fees pursuant to Section 2.05(b)(ii). The acceptance of any
appointment as the Issuing Bank hereunder by a successor Lender shall be
evidenced by an agreement entered into by such successor, in a form satisfactory
to the Borrower and the Paying Agent, and, from and after the effective date of
such agreement, (i) such successor Lender shall have all the rights and
obligations of the previous Issuing Bank under this Agreement and the other Loan
Documents and (ii) references herein and in the other Loan Documents to the term
"Issuing Bank" shall be deemed to refer to such successor or to any previous
Issuing Bank, or to such successor and all previous Issuing Banks, as the
context shall require. After the resignation or removal of the Issuing Bank
hereunder, the retiring Issuing Bank shall remain a party hereto and shall
continue to have all the rights and obligations of an Issuing Bank under this
Agreement and the other Loan Documents with respect to Letters of Credit issued
by it prior to such resignation or removal, but shall not be required to issue
additional Letters of Credit.
(j) Cash Collateralization. If (i) any Event of Default shall occur and
be continuing or (ii) to the extent and so long as the L/C Exposure exceeds the
Total Revolving Credit Commitments, the Borrower shall, on the Business Day it
receives notice from the Paying Agent or the Required Lenders (or, if the
maturity of the Loans has been accelerated, Revolving Credit Lenders holding
participations in outstanding Letters of Credit representing greater than 50% of
the aggregate undrawn amount of all outstanding Letters of Credit) thereof and
of the amount to be deposited, deposit in an account with the Collateral Agent,
for the benefit of the Revolving Credit Lenders, an amount in cash equal to the
L/C Exposure (or in the case of clause (ii) of this sentence, the excess of the
L/C Exposure over the Total Revolving Credit Commitment) as of such date. Such
deposit shall be held by the Collateral Agent as collateral for the payment and
performance of the Obligations. The Collateral Agent shall have exclusive
dominion and control, including the exclusive right of withdrawal, over such
account. Other than any interest earned on the investment of such deposits in
Permitted Investments, which investments shall be made as selected by the
Collateral Agent, such deposits shall not bear interest. Interest or profits, if
any, on such investments shall accumulate in such account. Moneys in such
account shall (i) automatically be applied by the Paying Agent to reimburse the
Issuing Bank for L/C Disbursements for which it has not been reimbursed, (ii) be
held for the satisfaction of the reimbursement obligations of the Borrower for
the L/C Exposure at such time and (iii) if the maturity of the Loans has been
accelerated (but subject to the consent of Revolving Credit Lenders holding
participations in outstanding Letters of Credit representing greater than 50% of
the aggregate undrawn amount of all outstanding Letters of Credit), be applied
to satisfy the Obligations. If the Borrower is required to provide an amount of
cash collateral pursuant to clause (i) of the first sentence of this paragraph
(j), such amount (to the extent not applied as aforesaid) shall be returned to
the Borrower within three Business Days after all Events of Default have been
cured or waived. If the Borrower is required to provide an amount of cash
collateral pursuant to clause (ii) of the first sentence of this paragraph (j),
such amount shall be returned to the Borrower from time to time to the extent
that the amount of such cash collateral held by the Collateral Agent exceeds the
excess, if any, of the L/C
41
Exposure over the Total Revolving Credit Commitment so long as no Event of
Default shall have occurred and be continuing.
ARTICLE III
Representations and Warranties
The Borrower represents and warrants to the Paying Agent, the
Collateral Agent, the Issuing Bank and each of the Lenders that:
SECTION 3.01. Organization. Each of the Borrower and the Restricted
Subsidiaries is duly incorporated or organized, validly existing and in good
standing under the laws of its jurisdiction of incorporation or organization, as
the case may be, and has all organizational powers and all material governmental
licenses, authorizations, consents and approvals required to carry on its
business as now conducted, except, in each case, where the failure to satisfy
any of the above could not be reasonably expected to result in a Material
Adverse Effect.
SECTION 3.02. Corporate and Governmental Authorization; No
Contravention. The execution and delivery by the Borrower of this Agreement and
the Pledge Agreement and the performance by the Borrower of its obligations
hereunder and thereunder are within the Borrower's corporate powers and have
been duly authorized by all necessary corporate action. This Agreement has been
duly executed and delivered by the Borrower. No registration, recordation or
filing with or consent, approval or other action by any regulatory or other
governmental body, agency or official is required in connection with the
execution or delivery of this Agreement and the Pledge Agreement by the
Borrower, except where the failure to register, record or file could not
reasonably be expected to result in a Material Adverse Effect, or is necessary
for the validity or enforceability hereof or thereof, and the execution,
delivery, performance and enforcement of this Agreement and the Pledge Agreement
do not and will not contravene, or constitute a default under, any provision of
applicable law or regulation, or of the certificate of incorporation or by-laws
of the Borrower or any of the Restricted Subsidiaries, except where such
contravention or default could not be reasonably expected to result in a
Material Adverse Effect, or of any agreement, judgment, injunction, order,
decree or other instrument binding upon the Borrower or result in the creation
or imposition of any material Lien upon any asset of the Borrower or any of the
Restricted Subsidiaries (other than any Lien created under the Loan Documents).
SECTION 3.03. Enforceability. This Agreement constitutes (and, upon
execution and delivery thereof as contemplated thereby, the Pledge Agreement
will constitute) a valid and binding agreement of the Borrower, in each case
enforceable in accordance with its terms, except as the foregoing may be limited
by bankruptcy, insolvency, fraudulent transfer, reorganization, moratorium, or
other similar laws affecting the rights of creditors generally and by general
principles of equity, including those limiting the availability of specific
performance, injunctive relief, and other equitable remedies and those providing
for defenses based on fairness and reasonableness, regardless of whether
considered in a proceeding in equity or at law.
SECTION 3.04. Financial Statements. (a) The Borrower has heretofore
furnished to the Lenders (i) the consolidated balance sheet and statements of
income and retained earnings and cash flows of each of (A) the Borrower and its
subsidiaries and (B) PTI and its subsidiaries as of and for
42
the fiscal year ended December 31, 1996, in each case audited by and accompanied
by the opinion of Deloitte & Touche LLP, independent public accountants, and
(ii) as of and for the fiscal quarter ended March 31, 1997, certified by a
Financial Officer of the Borrower or PTI, as the case may be. Such financial
statements were prepared in accordance with GAAP applied on a consistent basis.
Such financial statements present fairly in accordance with GAAP the financial
condition and results of operations and cash flows of the Borrower and PTI, in
each case, as of such dates and for such periods. Such balance sheets and the
notes thereto (if any) disclose all material liabilities, direct or contingent,
of each of (A) the Borrower and its subsidiaries and (B) PTI and its
subsidiaries, in each case, as of the dates thereof, as required in accordance
with GAAP.
(b) The Borrower has heretofore caused the delivery to the Lenders of
the unaudited pro forma consolidating balance sheet of Newco and its
subsidiaries as of December 31, 1996 and March 31, 1997, prepared to give effect
to the Transactions as if they had occurred on such dates and the Borrower has
delivered to the Lenders unaudited pro forma consolidating statements of income
of Newco and its subsidiaries for the year ended December 31, 1996 and for the
twelve months ended March 31, 1997, assuming the Transactions had actually
occurred on January 1, 1996 and April 1, 1996, respectively. Such pro forma
balance sheets and income statements have been prepared based on reasonable
assumptions, are based on information which the Borrower believes to be the best
information available to Newco as of the date of delivery thereof, accurately
reflect all material adjustments required to be made to give effect to the
Transactions and present fairly on a pro forma basis the estimated consolidated
financial position of Newco and its subsidiaries as of December 31, 1996 and
March 31, 1997, assuming that the Transactions had actually occurred on such
dates, and present fairly on a pro forma basis the estimated consolidated
results of operations of Newco and its subsidiaries for the years ended December
31, 1996 and March 31, 1997, assuming that the Transactions had actually
occurred on January 1, 1996 and April 1, 1996, respectively.
SECTION 3.05. No Material Adverse Change. There has been no material
adverse change in the business, assets, operations, condition, financial or
otherwise, or material agreements of the Borrower and the Restricted
Subsidiaries, taken as a whole, since December 31, 1996, except for any such
change that results solely from a sale of all the capital stock or all or
substantially all of the assets of any of the Restricted Subsidiaries or PFS,
the sale of the Spring Creek Note, the making of the Powercor Contribution, the
PPM Contribution or the TPC Contribution, or the transfer of the Excluded
Assets, in each case in accordance with the terms hereof.
SECTION 3.06. Restricted Subsidiaries. The shares of capital stock or
other ownership interests of the Restricted Subsidiaries pledged as Collateral
under the Pledge Agreement are fully paid and non-assessable and are owned by
the Borrower, directly or indirectly, free and clear of all Liens (other than
any Lien created under the Loan Documents).
SECTION 3.07. Litigation; Compliance with Laws. (a) Except as set forth
in Schedule 3.07, there are not any actions, suits or proceedings at law or in
equity or by or before any Governmental Authority now pending or, to the
knowledge of the Borrower, threatened against or affecting the Borrower or any
Restricted Subsidiary or any business, property or rights of any such person (i)
that expressly involve any Loan Document or the Transactions or (ii) as to which
there is a reasonable possibility of an adverse determination and that, in
either case, could reasonably be expected, individually or in the aggregate, to
result in a Material Adverse Effect.
43
(b) None of the Borrower or any of the Restricted Subsidiaries or any
of their respective material properties or assets is in violation of, nor will
the continued operation of their material properties and assets as currently
conducted violate, any law, rule or regulation, or is in default with respect to
any judgment, writ, injunction, decree or order of any Governmental Authority,
where such violation or default could reasonably be expected to result in a
Material Adverse Effect.
SECTION 3.08. Agreements. (a) Neither the Borrower nor any of the
Restricted Subsidiaries is a party to any agreement or instrument or subject to
any corporate or other organizational restriction that has resulted or could
reasonably be expected to result in a Material Adverse Effect.
(b) Neither the Borrower nor any of the Restricted Subsidiaries is in
default in any manner under any provision of any indenture or other agreement or
instrument evidencing Indebtedness, or any other material agreement or
instrument to which it is a party or by which it or any of its properties or
assets are or may be bound, where such default could reasonably be expected to
result in a Material Adverse Effect.
(c) Each of the Spring Creek Loan Agreement, the Spring Creek Note and
the Spring Creek Participation Agreement is a valid and binding agreement or
obligation of the parties thereto and is in full force and effect. The
execution, delivery and performance of the Spring Creek Loan Agreement, the
Spring Creek Note and the Spring Creek Participation Agreement did not and will
not contravene, or constitute a default under, any provision of the Spring Creek
Coal Supply Contract.
SECTION 3.09. Federal Reserve Regulations. No part of the proceeds of
any Loan or any Letter of Credit will be used, whether directly or indirectly,
and whether immediately, incidentally or ultimately, for any purpose that
entails a violation of, or that is inconsistent with, the provisions of the
Regulations of the Board, including Regulation G, T, U or X.
SECTION 3.10. Investment Company Act; Public Utility Holding Company
Act. Neither the Borrower nor any Restricted Subsidiary is subject to regulation
under the Public Utility Holding Company Act of 1935, the Investment Company Act
of 1940, the Interstate Commerce Act or any other law or regulation which limits
the incurrence by the Borrower of Indebtedness, including laws relating to
common or contract carriers or the sale of electricity, gas, steam, water or
other public utility services.
SECTION 3.11. Use of Proceeds. The Borrower will use the proceeds of
the Loans and will request the issuance of Letters of Credit only for the
purposes specified in the preamble to this Agreement.
SECTION 3.12. Tax Returns. Each of the Borrower and the Restricted
Subsidiaries, and any other affiliate with joint and several liability for
taxes, has filed or caused to be filed all Federal, state, local and other
material tax returns or materials required to have been filed by it and has paid
or caused to be paid all taxes due and payable by it pursuant thereto and all
assessments received by it, except where the failure to do any of the foregoing
could not reasonably be expected to result in a Material Adverse Effect.
SECTION 3.13. No Material Misstatements. None of (a) the Confidential
Information Memorandum or (b) any other information, report, financial
statement, exhibit or schedule furnished
44
by or on behalf of the Borrower to the Paying Agent or any Lender in connection
with the negotiation of any Loan Document or included therein or delivered
pursuant thereto, when taken as a whole, contained, contains or will contain any
material misstatement of fact or omitted, omits or will omit to state any
material fact necessary to make the statements therein, in the light of the
circumstances under which they were, are or will be made, not misleading;
provided that to the extent any such information report, financial statement,
exhibit or schedule was based upon or constitutes a forecast or projection, the
Borrower represents only that it acted in good faith and utilized reasonable
assumptions and due care in the preparation of such information, report,
financial statement, exhibit or schedule.
SECTION 3.14. Employee Benefit Plans. Each of the Borrower and its
ERISA Affiliates is in compliance with the applicable provisions of ERISA and
the Code and the regulations and published interpretations thereunder, except
where the failure to comply could not be reasonably expected to result in a
Material Adverse Effect. None of the Borrower or any ERISA Affiliate has (i)
sought a waiver of the minimum funding standard under Section 412 of the Code in
respect of any Plan, (ii) failed to make any contribution or payment to any Plan
or Multiemployer Plan or made any amendment to any Plan which has resulted or
could result in the imposition of a Lien or the posting of a bond or other
security under ERISA or the Code or (iii) incurred any material liability under
Title IV of ERISA other than a liability to the PBGC for premiums under Section
4007 of ERISA.
SECTION 3.15. Environmental Matters. Except as set forth in Schedule
3.15:
(a) The properties owned or operated by the Borrower and the Restricted
Subsidiaries (the "Properties") do not contain any Hazardous Materials in
amounts or concentrations which (i) constitute a violation of, (ii) require
Remedial Action under, or (iii) could give rise to liability under,
Environmental Laws, which violations, Remedial Actions and liabilities, in the
aggregate, could result in a Material Adverse Effect;
(b) The Properties and all operations of the Borrower and the
Restricted Subsidiaries are in compliance with all Environmental Laws and all
necessary Environmental Permits have been obtained and are in effect, except to
the extent that such non-compliance or failure to obtain any necessary permits,
in the aggregate, could not result in a Material Adverse Effect;
(c) There have been no Releases or threatened Releases at, from or
under the Properties or otherwise in connection with the operations of the
Borrower or the Restricted Subsidiaries, which Releases or threatened Releases,
in the aggregate, could result in a Material Adverse Effect;
(d) Neither the Borrower nor any of the Restricted Subsidiaries has
received any notice of an Environmental Claim in connection with the Properties
or the operations of the Borrower or the Restricted Subsidiaries or with regard
to any person whose liabilities for environmental matters the Borrower or the
Restricted Subsidiaries has retained or assumed, in whole or in part,
contractually, by operation of law or otherwise, which, in the aggregate, could
result in a Material Adverse Effect, nor do the Borrower or the Restricted
Subsidiaries have reason to believe that any such notice will be received or is
being threatened; and
(e) Hazardous Materials have not been transported from the Properties,
nor have Hazardous Materials been generated, treated, stored or disposed of at,
on or under any of the Properties in a
45
manner that could give rise to liability under any Environmental Law, nor have
the Borrower or the Restricted Subsidiaries retained or assumed any liability,
contractually, by operation of law or otherwise, with respect to the generation,
treatment, storage or disposal of Hazardous Materials, which transportation,
generation, treatment, storage or disposal, or retained or assumed liabilities,
in the aggregate, could result in a Material Adverse Effect.
SECTION 3.16. Pledge Agreement. The Pledge Agreement is effective to
create in favor of the Collateral Agent, for the ratable benefit of the Secured
Parties, a legal, valid and enforceable security interest in the Collateral and,
when the Collateral is delivered to the Collateral Agent, the Pledge Agreement
shall constitute a duly perfected first priority Lien on, and security interest
in, all right, title and interest of the pledgor thereunder in the Collateral,
in each case prior and superior in right to any other person.
ARTICLE IV
Conditions
SECTION 4.01. Effective Date. The effectiveness of this Agreement shall
be subject to the satisfaction of each of the following conditions:
(a) The Paying Agent shall have received, on behalf of itself
and the Lenders and the Issuing Bank, a favorable written opinion of
Stoel Rives LLP, counsel for the Borrower, substantially to the effect
set forth in Exhibit E-1 and a favorable written opinion of Xxxxx Xxxx
& Xxxxxxxx, special counsel for the Borrower, substantially to the
effect set forth in Exhibit E-2.
(b) The Paying Agent shall have received (i) a copy of the
certificate or articles of incorporation, including all amendments
thereto, of the Borrower, certified as of a recent date by the
Secretary of State of the state of its organization, and a certificate
as to the good standing of the Borrower as of a recent date, from such
Secretary of State; (ii) a certificate of the Secretary or Assistant
Secretary of the Borrower dated the Closing Date and certifying (A)
that attached thereto is a true and complete copy of the by-laws of the
Borrower as in effect on the Closing Date and at all times since a date
prior to the date of the resolutions described in clause (B) below, (B)
that attached thereto is a true and complete copy of resolutions duly
adopted by the Board of Directors of the Borrower authorizing the
execution, delivery and performance of the Loan Documents to which such
person is a party and the borrowings hereunder, and that such
resolutions have not been modified, rescinded or amended and are in
full force and effect, (C) that the certificate or articles of
incorporation of the Borrower have not been amended since the date of
the last amendment thereto shown on the certificate of good standing
furnished pursuant to clause (i) above, and (D) as to the incumbency
and specimen signature of each officer executing any Loan Document or
any other document delivered in connection herewith on behalf of the
Borrower; and (iii) a certificate of another officer as to the
incumbency and specimen signature of the Secretary or Assistant
Secretary executing the certificate pursuant to clause (ii) above.
(c) The Paying Agent shall have received a certificate, signed
by a Financial Officer of the Borrower, dated the Closing Date and
confirming that the representations and
46
warranties set forth in Article III hereof are true and correct in all
material respects, except to the extent any such representation and
warranty relates to an earlier date.
(d) The Pledge Agreement shall have been duly executed by the
parties thereto and delivered to the Collateral Agent.
(e) The Paying Agent and the Initial Lenders shall have
received all fees and other amounts due and payable on the Closing Date
in connection with the Offer.
SECTION 4.02. Borrowings. (a) The obligation of any Lender to make a
Loan on the occasion of any Borrowing, the proceeds of which are to be used,
directly or indirectly, to finance the Offer or to pay costs and expenses
related thereto or for any other purpose set forth in Clause 3.1(a)(i) of the
Bidco Facility Agreement, as in effect on the Restatement Date, or to enable the
Borrower to repay or prepay the Existing Indebtedness or the Refinanced
Indebtedness, is subject to the satisfaction of the following conditions:
(i) The Paying Agent shall have received a notice of Borrowing
as required by Section 2.03.
(ii) At the time of and immediately after such Borrowing, no
Event of Default described in clause (g), (h) or (l) of Article VII
shall have occurred and be continuing with respect to the Borrower.
(iii) The PFS Pre-Funding Sale shall have been consummated.
(iv) The representations and warranties set forth in Sections
3.01, 3.02 and 3.03, as they relate to the Borrower, shall be true and
correct in all material respects on the date of any such Borrowing with
the same effect as though made on such date.
(v) The Borrower shall have repaid in full (or shall have made
satisfactory provision for the repayment in full of) the principal of
all loans outstanding, interest thereon and other amounts due and
payable in respect of the Refinanced Indebtedness, and the Paying Agent
shall have received duly executed documentation either evidencing or
reasonably providing for (A) the cancelation of the Refinanced
Indebtedness and each agreement related thereto except for indemnity
provisions that expressly survive the termination of such applicable
agreement, (B) the cancelation of all commitments to lend under any
such agreement and (C) the termination of all related guarantees and
security interests granted by the Borrower or any other person in
connection therewith and the discharge of all obligations or interests
thereunder.
(vi) Each of the applicable conditions precedent with respect
to a borrowing to finance the Offer set forth in the Powercoal Credit
Agreement, the Energyco Bridge Loan Agreement and the Bidco Facility
Agreement (other than any condition in any such agreement requiring
that borrowings shall have been made under this or any other such
agreement and/or the proceeds of such borrowings have been made
available directly or indirectly to Bidco) shall have been satisfied or
waived in accordance with the terms thereof and each of such agreements
shall be in full force and effect.
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Each Borrowing hereunder of the type described in this Section 4.02(a) shall be
deemed to be a representation and warranty by the Borrower on the date of such
Borrowing as to the facts specified in clauses (ii), (iii), (iv), (v) and (vi)
of this Section 4.02(a).
(b) The obligation of any Lender to make a Loan, or of the Issuing Bank
to issue a Letter of Credit (each, a "Credit Event") on the occasion of any
Credit Event other than (i) a Borrowing of the type described in Section 4.02(a)
or (ii) a continuation or conversion of a Borrowing of the type described in
Section 2.10, is subject to the satisfaction of the following conditions:
(i) The Paying Agent shall have received a notice of such
Credit Event as required by Section 2.03 or, in the case of the
issuance of a Letter of Credit, the Issuing Bank and the Paying Agent
shall have received a notice requesting the issuance of such Letter of
Credit as required by Section 2.22(b).
(ii) The representations and warranties set forth in Article
III hereof shall be true and correct in all material respects on and as
of the date of such Credit Event with the same effect as though made on
and as of such date, except to the extent such representations and
warranties expressly relate to an earlier date.
(iii) At the time of and immediately after such Credit Event,
no Event of Default or Default shall have occurred and be continuing.
Each Credit Event of the type described in this Section 4.02(b) shall be deemed
to constitute a representation and warranty by the Borrower on the date of such
Credit Event as to the matters specified in paragraphs (ii) and (iii) of this
Section 4.02(b).
ARTICLE V
Affirmative Covenants
The Borrower covenants and agrees with each Lender that so long as this
Agreement shall remain in effect and until the Commitments have been terminated
and the principal of and interest on each Loan, all Fees and all other expenses
or amounts then due and payable under any Loan Document shall have been paid in
full and all Letters of Credit have been canceled or have expired and all
amounts drawn thereunder have been reimbursed in full, unless the Required
Lenders shall otherwise consent in writing, the Borrower will, and will cause
each of the Restricted Subsidiaries to:
SECTION 5.01. Existence; Businesses and Properties. (a) Do or cause to
be done all things necessary to preserve, renew and keep in full force and
effect the legal existence of the Borrower and each Significant Subsidiary,
except as otherwise expressly permitted under Section 6.05.
(b) Do or cause to be done all things necessary to obtain, preserve,
renew, extend and keep in full force and effect the rights, licenses, permits,
franchises, authorizations, patents, copyrights, trademarks and trade names
material to the conduct of its business; except as contemplated by this
Agreement, maintain and operate such business in substantially the manner in
which it is presently conducted and operated; and at all times maintain and
preserve all property material to the conduct
48
of such business and keep such property in good repair, working order and
condition and from time to time make, or cause to be made, all needful and
proper repairs, renewals, additions, improvements and replacements thereto
necessary in order that the business carried on in connection therewith may be
properly conducted in all material respects at all times, in each case, where
the failure to do so could reasonably be expected to have a Material Adverse
Effect.
SECTION 5.02. Insurance. Keep its insurable properties adequately
insured at all times by financially sound and reputable insurers; maintain such
other insurance (including self insurance), to such extent and against such
risks, including fire and other risks insured against by extended coverage, as
is customary with companies in the same or similar businesses operating in the
same or similar locations, including public liability insurance against claims
for personal injury or death or property damage occurring upon, in, about or in
connection with the use of any properties owned, occupied or controlled by it;
and maintain such other insurance as may be required by law.
SECTION 5.03. Obligations and Taxes. Pay its Indebtedness and other
material obligations promptly and in accordance with their terms and pay and
discharge promptly when due all material taxes, assessments and governmental
charges or levies imposed upon it or upon its income or profits or in respect of
its property, before the same shall become delinquent or in default, as well as
all material lawful claims for labor, materials and supplies or otherwise that,
if unpaid, might give rise to a Lien upon such properties or any part thereof;
provided, however, that such payment and discharge shall not be required with
respect to any such tax, assessment, charge, levy or claim so long as the
validity or amount thereof shall be contested in good faith by appropriate
proceedings and the Borrower shall have set aside on its books adequate reserves
with respect thereto in accordance with GAAP and such contest operates to
suspend collection of the contested obligation, tax, assessment or charge and
enforcement of a Lien.
SECTION 5.04. Financial Statements, Reports, etc. In the case of the
Borrower, furnish to the Paying Agent and each Lender:
(a) as soon as available and in any event within 120 days
after the end of each fiscal year, a consolidated balance sheet and
related statement of income and retained earnings and cash flows
showing the financial condition of each of (i) the Borrower and its
subsidiaries and (ii) PTI and its subsidiaries as of the close of and
during such fiscal year, in each case audited by Deloitte & Touche LLP
or other independent public accountants of recognized national standing
and accompanied by an opinion of such accountants (which shall not be
qualified in any material respect) to the effect that such consolidated
financial statements fairly present the financial condition and results
of operations of (A) the Borrower and its subsidiaries and (B) PTI and
its subsidiaries, as the case may be, on a consolidated basis in
accordance with GAAP consistently applied (except as otherwise provided
in the notes thereto);
(b) as soon as available and in any event within 120 days
after the end of each fiscal year, an unaudited consolidating balance
sheet and related statement of income for the Borrower and its
subsidiaries for the four quarter period ending as of the close of such
fiscal year;
49
(c) as soon as available and in any event within 60 days after
the end of each of the first three fiscal quarters of each fiscal year
(or, in the case of PFS, each fiscal quarter), a consolidated balance
sheet and related statement of income and retained earnings and cash
flows showing the financial condition of each of (i) the Borrower and
its subsidiaries, (ii) PTI and its subsidiaries and (iii) PFS and its
subsidiaries as of the close of and during such fiscal quarter and the
then elapsed portion of the fiscal year, in each case certified by one
of the Borrower's, PTI's or PFS's (as the case may be) Financial
Officers as fairly presenting the financial condition and results of
operations of (A) the Borrower and its subsidiaries, (B) PTI and its
subsidiaries and (C) PFS and its subsidiaries, as the case may be, on a
consolidated basis in accordance with GAAP consistently applied (except
for the absence of footnote disclosure), subject to normal year-end
audit adjustments;
(d) concurrently with any delivery of financial statements
under paragraph (a), (b) or (c) above, (i) a certificate of the
applicable accounting firm or Financial Officer opining on or
certifying such statements (which certificate, when furnished by an
accounting firm, may be limited to accounting matters and disclaim
responsibility for legal interpretations) certifying that no Event of
Default has occurred and that no Default has occurred and is continuing
or, if such an Event of Default has occurred or a Default has occurred
and is continuing, specifying the nature and extent thereof and any
corrective action taken or proposed to be taken with respect thereto
and (ii) a certificate of a Financial Officer of the Borrower setting
forth the Net Termination Value as of the date of such financial
statements;
(e) promptly after the same become publicly available, copies
of all periodic and other reports, proxy statements and other materials
filed by the Borrower or any Restricted Subsidiary with the Securities
and Exchange Commission, or any Governmental Authority succeeding to
any or all of the functions of said Commission, or with any national
securities exchange, or distributed to its public shareholders, as the
case may be; and
(f) promptly, from time to time, such other information
regarding the operations, business affairs and financial condition of
the Borrower or any Restricted Subsidiary or any of its subsidiaries,
or compliance with the terms of any Loan Document, as the Paying Agent
or any Lender may reasonably request.
SECTION 5.05. Litigation and Other Notices. Furnish to the Paying
Agent, the Issuing Bank and each Lender prompt written notice of the following:
(a) any Event of Default or Default, specifying the nature and
extent thereof and the corrective action (if any) taken or proposed to
be taken with respect thereto;
(b) the filing or commencement of, or any threat or notice of
intention of any person to file or commence, any action, suit or
proceeding, whether at law or in equity or by or before any
Governmental Authority, against the Borrower or any Affiliate thereof
that could reasonably be expected to result in a Material Adverse
Effect; and
(c) any development of which a Responsible Officer is aware
that has resulted in, or which such Responsible Officer has reasonably
concluded will result in, a Material Adverse Effect.
50
SECTION 5.06. Maintaining Records; Access to Properties and
Inspections. Keep proper books of record and account in which full, true and
correct entries in conformity with GAAP and all requirements of law are made of
all dealings and transactions in relation to its business and activities. The
Borrower will, and will cause each of the Restricted Subsidiaries to, permit any
representatives designated by the Paying Agent or any Lender to visit and
inspect the financial records and the properties of the Borrower or any
Restricted Subsidiary at reasonable times and as often as reasonably requested
and to make extracts from and copies of such financial records, and permit any
representatives designated by the Paying Agent or any Lender to discuss (in the
presence of the Borrower or such Restricted Subsidiary, as applicable, unless a
Default or Event of Default shall have occurred and is continuing) the affairs,
finances and condition of the Borrower or any Restricted Subsidiary with the
officers thereof and independent accountants therefor.
SECTION 5.07. Use of Proceeds. Use the proceeds of the Loans and
request the issuance of Letters of Credit only for the purposes set forth in the
preamble to this Agreement.
SECTION 5.08. Compliance with Laws. Comply in all respects with all
applicable laws, ordinances, rules, regulations and requirements of Governmental
Authorities (including Environmental Laws and ERISA and the rules and
regulations thereunder), except where the necessity of compliance therewith is
contested in good faith by appropriate proceedings or where non-compliance
therewith could not reasonably be expected to have a Material Adverse Effect.
SECTION 5.09. Further Assurances. Execute any and all further
documents, financing statements, agreements and instruments, and take all
further action (including filing Uniform Commercial Code and other financing
statements) that may reasonably be required under applicable law, or that the
Required Lenders, the Paying Agent or the Collateral Agent may reasonably
request, in order to effectuate the transactions contemplated by the Loan
Documents and in order to grant, preserve, protect and perfect the validity and
first priority of the security interests created or intended to be created by
the Pledge Agreement.
SECTION 5.10. Repayment of Existing Indebtedness. As soon as
practicable, and in any event no later than 30 days after the date of the
initial Acquisition Borrowing, the Borrower shall repay or cause to be repaid
all Existing Indebtedness, and all obligations thereunder shall be terminated
(except for obligations that, by the terms of the applicable agreement,
expressly survive termination) and all commitments thereunder shall be canceled.
SECTION 5.11. Open Market Shares. On or prior to the date of the
initial Acquisition Borrowing pursuant to Section 4.02(a), transfer or cause to
be transferred all the Open Market Shares to Bidco.
SECTION 5.12. PPM Contribution. As soon as practicable, but in any
event not later than 270 days after the initial Acquisition Borrowing, effect
the PPM Contribution.
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ARTICLE VI
Negative Covenants
The Borrower covenants and agrees with each Lender that, so long as
this Agreement shall remain in effect and until the Commitments have been
terminated and the principal of and interest on each Loan, all Fees and all
other expenses or amounts then due and payable under any Loan Document have been
paid in full and all Letters of Credit have been canceled or have expired and
all amounts drawn thereunder have been reimbursed in full, unless the Required
Lenders shall otherwise consent in writing, the Borrower will not, and will not
cause or permit any of the Restricted Subsidiaries to:
SECTION 6.01. Indebtedness. Incur, create, assume or permit to exist
any Indebtedness, except:
(a) Indebtedness outstanding on the Closing Date, or available
under debt instruments existing on the Closing Date;
(b) Indebtedness created hereunder and under the other Loan
Documents;
(c) Guarantees in respect of Indebtedness permitted pursuant
to this Section 6.01 or in respect of investments permitted by Section
6.04(b) (provided that any Guarantees in respect of Indebtedness that
is subordinated to the Obligations shall be subordinated to the
Obligations to the same extent as such Indebtedness is subordinated to
the Obligations);
(d) Indebtedness of any wholly owned Restricted Subsidiary to
any other wholly owned Restricted Subsidiary or the Borrower;
(e) Indebtedness of the Restricted Subsidiaries (including tax
exempt financings and Capital Lease Obligations) to acquire, construct,
develop or improve assets in the ordinary course of business after the
Closing Date incurred in the ordinary course of business after the
Closing Date or in connection with sale and lease-back transactions of
a type described in Section 6.03; provided that the aggregate principal
amount of any Indebtedness incurred pursuant to this paragraph (e)
outstanding at any time shall not exceed $50,000,000;
(f) Indebtedness of PTI and its subsidiaries;
(g) extensions, renewals or refinancing of Indebtedness under
paragraph (a) so long as (i) such Indebtedness (the "Refinancing
Indebtedness") is in an aggregate principal amount not greater than the
aggregate principal amount of the Indebtedness being extended, renewed
or refinanced plus the amount of any premiums required to be paid
thereon and fees and expenses associated therewith, (ii) such
Refinancing Indebtedness has a later or equal final maturity and a
longer or equal weighted average life than the Indebtedness being
extended, renewed or refinanced, (iii) the interest rate applicable to
such Refinancing Indebtedness shall be a market interest rate (as
determined in good faith by the Board of Directors of the Borrower) as
of the time of such extension, renewal or refinancing, (iv) if the
Indebtedness being extended, renewed or refinanced is subordinated to
the Obligations, such Refinancing
52
Indebtedness is subordinated to the Obligations to the extent of the
Indebtedness being extended, renewed or refinanced, (v) the covenants,
events of default and other provisions thereof (including any
Guarantees thereof), taken as a whole, shall be no less favorable to
the Lenders than those contained in the Indebtedness being refinanced
and (vi) at the time of and after giving effect to such extension,
renewal or refinancing, no Default or Event of Default shall have
occurred and be continuing;
(h) in the case of PPM only, Guarantees in respect of
Powercoal's obligations under the Powercoal Credit Agreement; and
(i) unsecured Indebtedness of the Restricted Subsidiaries in
addition to that permitted by paragraphs (a) through (h) above in an
aggregate principal amount outstanding not to exceed at any time
$50,000,000.
SECTION 6.02. Liens. Create, incur, assume or permit to exist any Lien
on any property or assets (including stock or other securities of any person,
including any Restricted Subsidiary) now owned or hereafter acquired by it or on
any income or revenues or rights in respect of any thereof, except:
(a) Liens on property or assets of the Borrower and the
Restricted Subsidiaries existing on the Closing Date; provided that
such Liens shall secure only those obligations which they secure on the
Closing Date;
(b) any Lien created under the Loan Documents;
(c) any Lien existing on any property or asset prior to the
acquisition thereof by the Borrower or any Restricted Subsidiary;
provided that (i) such Lien is not created in contemplation of or in
connection with such acquisition and (ii) such Lien does not apply to
any other property or assets of the Borrower or any Restricted
Subsidiary;
(d) Liens for taxes not yet due or which are being contested
in compliance with Section 5.03;
(e) carriers', warehousemen's, mechanics', materialmen's,
repairmen's, landlord's or other like Liens arising in the ordinary
course of business and securing obligations that are not due and
payable or which are being contested in compliance with Section 5.03;
(f) pledges and deposits made in the ordinary course of
business in compliance with workmen's compensation, unemployment
insurance and other social security laws or regulations;
(g) deposits to secure the performance of bids, trade
contracts (other than for Indebtedness), leases (other than Capital
Lease Obligations), statutory obligations, surety and appeal bonds,
performance bonds and other obligations of a like nature incurred in
the ordinary course of business;
53
(h) Liens created by or relating to any legal proceeding which
at the time is being contested in good faith by appropriate
proceedings; provided that, in the case of a Lien consisting of an
attachment or judgment Lien, the judgment it secures shall, within 60
days of entry thereof, have been discharged or execution thereof stayed
pending appeal, or discharged within 60 days after the expiration of
any such stay;
(i) any Lien on (i) the proceeds of sale of commercial paper
issued by the Borrower or (ii) the Borrower's right to receive such
proceeds, securing the Borrower's obligation to reimburse the issuer of
a letter of credit for drawings to repay commercial paper previously
issued by the Borrower;
(j) zoning restrictions, easements, rights-of-way,
restrictions on use of real property and other similar encumbrances
incurred in the ordinary course of business which, in the aggregate,
are not substantial in amount and do not materially detract from the
value of the property subject thereto or interfere with the ordinary
conduct of the business of the Borrower or any of the Restricted
Subsidiaries;
(k) purchase money security interests in real property,
improvements thereto, equipment or other fixed assets hereafter
acquired (or, in the case of improvements, equipment or other fixed
assets, constructed) by the Borrower or any Restricted Subsidiary;
provided that (i) such security interests secure Indebtedness permitted
by Section 6.01, (ii) such security interests are incurred, and the
Indebtedness secured thereby is created, no later than 90 days after
such acquisition (or completion of such construction), (iii) the
Indebtedness secured thereby does not exceed the cost of such real
property, improvements or equipment at the time of such acquisition (or
construction) and (iv) such security interests do not apply to any
other property or assets of the Borrower or any Restricted Subsidiary
(other than the proceeds of the real property, improvements, equipment
or other fixed assets subject to such Lien);
(l) Liens securing Refinancing Indebtedness, to the extent
that the Indebtedness being refinanced was originally secured in
accordance with this Section 6.02, provided that such Lien does not
apply to any additional property or assets of the Borrower or any
Restricted Subsidiary (other than the proceeds of the property or asset
subject to such Lien);
(m) Liens arising out of Indebtedness permitted under Section
6.01(e), so long as such Liens (i) attach only to the property subject
to such Indebtedness and (ii) do not interfere with the business of the
Borrower or any of the Restricted Subsidiaries in any material respect;
(n) Liens securing Non-Recourse Indebtedness; provided that
such Lien does not apply to any additional property or assets of the
Borrower or any Restricted Subsidiary (other than the property or
Single Purpose Entity relating to such Non-Recourse Indebtedness);
(o) Liens on the property or assets of PTI and its
subsidiaries;
54
(p) Liens on cash and cash equivalents securing hedging by
PPM; provided that the aggregate amount of cash and cash equivalents
subject to such Liens shall not exceed at any time $5,000,000;
(q) Liens on the capital stock and assets of PPM to secure its
obligations under the Indebtedness permitted under Section 6.01(h); and
(r) Liens in addition to those permitted by paragraphs (a)
through (q); provided, however, that the aggregate principal amount of
Indebtedness and amount of other liabilities of the Restricted
Subsidiaries that is secured by such Liens do not exceed at any time
$50,000,000.
SECTION 6.03. Sale and Lease-Back Transactions. Enter into any
arrangement, directly or indirectly, with any person whereby it shall sell or
transfer any property, real or personal, used or useful in its business, whether
now owned or hereafter acquired, and thereafter rent or lease such property or
other property which it intends to use for substantially the same purpose or
purposes as the property being sold or transferred; provided that (a) the
Borrower and the Restricted Subsidiaries may enter into any such transaction to
the extent the Indebtedness and Liens associated therewith would be permitted by
Sections 6.01(e) and 6.02(m), respectively and (b) PTI and its subsidiaries may
enter into any sale and lease-back transaction.
SECTION 6.04. Investments, Loans and Advances. Purchase, hold or
acquire any capital stock, evidences of indebtedness or other securities of,
make or permit to exist any loans or advances to, or make or permit to exist any
investment or any other interest in, any other person, except:
(a) existing investments in its subsidiaries (including PPM
prior to the date the PPM Contribution is effected in accordance with
Section 5.12) and additional investments in the Restricted
Subsidiaries;
(b) investments, loans and advances of the Borrower and the
Restricted Subsidiaries existing on the Closing Date or pursuant to
commitments set forth in Schedule 6.04(b);
(c) investments, loans and advances in or to its subsidiaries
the proceeds of which are used (i) by Bidco to finance a portion of the
Offer or (ii) by Powercoal to prepay loans under the Powercoal Credit
Agreement;
(d) Permitted Investments;
(e) investments, loans and advances in or to Affiliates (other
than Newco and its subsidiaries) not exceeding in the aggregate
$85,000,000 at any time outstanding;
(f) investments in Hedging Agreements permitted under this
Agreement, including any Funding Exchange Rate Protection Agreements
and the contribution of such agreements to Newco and its subsidiaries
in connection with the Offer;
(g) investments constituting non-cash consideration received
in connection with a sale of assets not prohibited by Section 6.05;
55
(h) investments, loans and advances by PTI and its
subsidiaries; provided that the aggregate consideration to be paid by
PTI or any of its subsidiaries in connection with the acquisition of
any person or assets or business unit of any person in a single
transaction or series of related transactions shall not exceed
$150,000,000 (except with respect to any acquisition set forth in
Schedule 6.04(h));
(i) loans, advances and letter of credit reimbursement
obligations relating to the PFS Intercompany Note;
(j) so long as no Event of Default shall have occurred and be
continuing, investments in the form of payments made pursuant to the
Tax Sharing Arrangement;
(k) the Powercor Contribution, the PPM Contribution, the TPC
Contribution and the PFS Pre-Funding Sale; and
(l) investments, loans and advances to the extent not
permitted by paragraphs (a) through (k) above; provided that such
investments, loans and advances do not exceed in the aggregate
$50,000,000.
SECTION 6.05. Mergers, Consolidations, Sales of Assets, Equity
Issuances and Acquisitions. (a) Merge into or consolidate with any other person,
or permit any other person to merge into or consolidate with it, permit any
Restricted Subsidiary to effect an Equity Issuance, or sell, transfer, lease or
otherwise dispose of (in one transaction or in a series of transactions) all or
substantially all the assets of the Borrower, or purchase, lease or otherwise
acquire (in one transaction or a series of transactions) all or any substantial
part of the assets of any other person, except:
(i) the Borrower and any Restricted Subsidiary may purchase
and sell inventory in the ordinary course of business;
(ii) if at the time thereof and immediately after giving
effect thereto no Event of Default or Default shall have occurred and
be continuing, any wholly owned Restricted Subsidiary may merge into or
consolidate with any other wholly owned Restricted Subsidiary in a
transaction in which the surviving entity is a wholly owned Restricted
Subsidiary and no person other than the Borrower or a wholly owned
Restricted Subsidiary receives any consideration;
(iii) PTI or any of its subsidiaries may effect any sale,
lease, transfer or other disposition set forth in Schedule 1.01(c) or
any PTI Asset Sale (other than as permitted by Section 6.05(a)(v)
below) if the aggregate consideration to be received by PTI in
connection with one such transaction or series of related transactions
does not exceed $150,000,000;
(iv) the Borrower may effect the Powercor Contribution, the
PPM Contribution, the TPC Contribution and the PFS Pre-Funding Sale;
(v) the Borrower may sell, transfer or otherwise dispose of
all the capital stock of any Restricted Subsidiary (including PTI), the
PFSAC Obligation or the Spring Creek Note so long as (i) at the time
thereof and immediately after giving effect thereto, no Event of
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Default or Default shall have occurred and be continuing, (ii) the
Borrower complies with Section 2.13 with respect to the Net Cash
Proceeds received from any such sale, transfer or other disposition,
and (iii) in the case of any sale of the capital stock or substantially
all of the assets of PTI, the terms and conditions of such sale
(including with respect to the purchase price and the form of
consideration to be received) shall be reasonably satisfactory to the
Required Lenders, unless the Net Cash Proceeds from such sale of PTI
exceed $1,000,000,000;
(vi) acquisitions constituting investments permitted by
Section 6.04; and
(vii) the Borrower may sell, transfer or otherwise dispose of
the Excluded Assets to any subsidiary of PacifiCorp.
(b) Notwithstanding Section 6.05(a), no Asset Sale or PTI Asset Sale
shall be permitted under this Agreement unless (i) the consideration to be
received in connection therewith shall be at least equal to the fair market
value of the assets or property sold, transferred or otherwise disposed of (as
determined in good faith by the board of directors of the Borrower) and (ii)
except with respect to any Asset Sale that results in an investment permitted by
6.04(l), in the case of an Asset Sale of property having a value of (x) more
than $25,000,000 but less than $150,000,000, such Asset Sale shall be for
consideration at least 50% of which is cash, and (y) $150,000,000 or more, such
Asset Sale shall be for consideration at least 80% of which is cash.
SECTION 6.06. Dividends and Distributions; Restrictions on Ability of
Restricted Subsidiaries to Pay Dividends. (a) Declare or pay, directly or
indirectly, any dividend or make any other distribution (by reduction of capital
or otherwise), whether in cash, property, securities or a combination thereof,
with respect to any shares of its capital stock or directly or indirectly
redeem, purchase, retire or otherwise acquire for value (or permit any
Restricted Subsidiary to purchase or acquire) any shares of any class of its
capital stock or set aside any amount for any such purpose; provided, however,
that (i) any Restricted Subsidiary may declare and pay dividends or make other
distributions to the Borrower or another Restricted Subsidiary to facilitate a
dividend to the Borrower and (ii) if no Default or Event of Default shall have
occurred and be continuing or would occur as a consequence thereof, the Borrower
and the Restricted Subsidiaries may make payments required to be made under the
Tax Sharing Arrangement so long as the payment thereunder by the Borrower and
the Restricted Subsidiaries shall not exceed the amount the Borrower and its
Restricted Subsidiaries would be required to pay under such arrangement as in
effect on the Closing Date.
(b) Permit the Restricted Subsidiaries to, directly or indirectly,
create or otherwise cause or suffer to exist or become effective any encumbrance
or restriction on the ability of any such subsidiary to (i) pay any dividends or
make any other distributions on its capital stock or any other interest or (ii)
make or repay any loans or advances to the Borrower or the parent of such
subsidiary (subclauses (i) and (ii) are collectively referred to as an "Upstream
Payment"); provided, however, that the foregoing shall not restrict any
encumbrances or restrictions:
(i) existing on the Closing Date under Indebtedness permitted
by Section 6.01(a);
(ii) contained in any debt instrument relating to a person
acquired after the Closing Date; provided that (A) such encumbrances
and restrictions are not applicable to any person
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other than such person or property or assets acquired, (B) such
instrument was in existence at the time of such acquisition and was not
created in contemplation of or in connection with such acquisition, and
(C) the Borrower reasonably believes at the time of such acquisition
that the terms of such instrument will not encumber or restrict the
ability of such acquired person to make an Upstream Payment in a manner
that would adversely affect the Borrower's ability to perform its
obligations under the Loan Documents when due;
(iii) incurred in connection with any Indebtedness permitted
pursuant to Section 6.01 (including any extension, refinancing, renewal
or replacement of Indebtedness contemplated by clauses (i) and (ii)
above); provided that (A) the Borrower reasonably believes at the time
such Indebtedness is incurred that the terms of such Indebtedness will
not restrict the ability of the person incurring such Indebtedness to
make an Upstream Payment in a manner that would adversely affect the
Borrower's ability to perform its obligations under the Loan Documents
when due, and (B) such Indebtedness contains no express encumbrances on
restrictions on the ability of such person to make an Upstream Payment;
(iv) imposed on any Single Purpose Entity;
(v) existing under, or by reason of, applicable law; and
(vi) any encumbrance or restriction on the transfer of any
property or asset in an agreement relating to the acquisition or
creation or disposition of such property or asset or any Lien on such
property or asset that is otherwise permitted by the terms of this
Agreement.
SECTION 6.07. Transactions with Affiliates. Make any material payment
to, or sell, lease, transfer or otherwise dispose of any material properties or
assets to, or purchase any material property or assets from, or enter into or
make or amend any material transaction, contract, agreement, understanding,
loan, advance or guarantee with, or for the benefit of, any Affiliate of any
such person (each of the foregoing, an "Affiliate Transaction"), unless such
Affiliate Transaction is on terms that are no less favorable to the Borrower or
the relevant Restricted Subsidiary than those that would have been obtained in a
comparable transaction by the Borrower or such Restricted Subsidiary with an
unrelated person; provided that (a) any payments that are permitted by Section
6.01, 6.04, 6.05(a)(vii) or 6.06(a) shall not be deemed to be Affiliate
Transactions and (b) the foregoing restriction shall not apply to (i)
transactions among the Borrower and the Restricted Subsidiaries, (ii)
transactions pursuant to the PFS Intercompany Note and (iii) transactions
pursuant to agreements entered into or in effect on the Closing Date (including
the Tax Sharing Arrangement).
SECTION 6.08. Business of Borrower and Restricted Subsidiaries. Engage
at any time in any business or business activity other than the business
currently conducted by it and business activities reasonably incidental thereto.
SECTION 6.09. Other Agreements. Permit any waiver, supplement,
modification, amendment, termination or release of any indenture, instrument or
agreement pursuant to which any Indebtedness or preferred stock of the Borrower
or any Restricted Subsidiary is outstanding or any other agreement (including
the Tax Sharing Arrangement) that is material to the conduct and operations of
the Borrower or any Restricted Subsidiary, or modify its charter or by-laws, in
each case
58
to the extent that any such waiver, supplement, modification, amendment,
termination or release would be adverse to the Lenders in any material respect.
SECTION 6.10. Interest Coverage. As at the end of any fiscal quarter of
the Borrower, permit the ratio of (i) Cash Income Available for Interest for the
preceding four fiscal quarter period to (ii) Interest Expense (After Tax) for
such period to be less than 1.25 to 1.00.
SECTION 6.11. PTI Total Debt/Total Capitalization. For so long as PTI
is a subsidiary of the Borrower, permit the ratio as at the end of any fiscal
quarter of (i) Total Debt to (ii) the sum of Consolidated Net Worth and Total
Debt to exceed 55%.
SECTION 6.12. PTI Consolidated EBITDA. For so long as PTI is a
subsidiary of the Borrower, permit Consolidated EBITDA for any period of four
consecutive fiscal quarters to be less than $225,000,000.
ARTICLE VII
Events of Default
In case of the happening of any of the following events ("Events of
Default"):
(a) any representation or warranty made or deemed made in or
in connection with any Loan Document or the borrowings or issuances of
Letters of Credit hereunder, or any representation, warranty, statement
or information contained in any report, certificate, financial
statement or other instrument furnished in connection with or pursuant
to any Loan Document, shall prove to have been false or misleading in
any material respect when so made, deemed made or furnished;
(b) default shall be made in the payment of any principal of
any Loan when and as the same shall become due and payable, whether at
the due date thereof or at a date fixed for prepayment thereof or by
acceleration thereof or otherwise;
(c) default shall be made in the payment of any interest on
any Loan or any Fee or any other amount (other than an amount referred
to in (b) above) due under any Loan Document, when and as the same
shall become due and payable, and such default shall continue
unremedied for a period of five Business Days;
(d) default shall be made in the due observance or performance
by the Borrower or any Restricted Subsidiary of any covenant, condition
or agreement contained in Section 5.01(a), 5.05(a) or 5.07 or in
Article VI;
(e) default shall be made in the due observance or performance
by the Borrower or any Restricted Subsidiary of any covenant, condition
or agreement contained in any Loan Document (other than those specified
in (b), (c) or (d) above) and such default shall continue unremedied
for a period of 30 days after notice thereof from the Paying Agent or
any Lender to the Borrower;
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(f) the Borrower or any Restricted Subsidiary shall (i) fail
to pay any principal or interest, regardless of amount, due in respect
of any Indebtedness (other than Non-Recourse Indebtedness) in a
principal amount in excess of $50,000,000, when and as the same shall
become due and payable, (ii) fail to observe or perform any other term,
covenant, condition or agreement contained in any agreement or
instrument evidencing or governing any such Indebtedness if the effect
of any failure referred to in this clause (ii) is to cause, or to
permit the holder or holders of such Indebtedness or a trustee on its
or their behalf to cause, such Indebtedness to become due prior to its
stated maturity or (iii) fail to make any payment in respect of any
Material Hedging Obligations when due;
(g) an involuntary proceeding shall be commenced or an
involuntary petition shall be filed in a court of competent
jurisdiction seeking (i) relief in respect of PacifiCorp, the Borrower,
Newco or any Significant Subsidiary (or any group of subsidiaries of
the Borrower which, if considered in the aggregate as a single
subsidiary, would constitute a Significant Subsidiary), or of a
substantial part of the property or assets of PacifiCorp, the Borrower,
Newco, such Significant Subsidiary or such group of subsidiaries of the
Borrower, under Title 11 of the United States Code, as now constituted
or hereafter amended, or any other Federal, state or foreign
bankruptcy, insolvency, receivership or similar law, (ii) the
appointment of a receiver, trustee, custodian, sequestrator,
conservator or similar official for PacifiCorp, the Borrower, Newco or
any Significant Subsidiary (or any group of subsidiaries of the
Borrower which, if considered in the aggregate as a single subsidiary,
would constitute a Significant Subsidiary) or for a substantial part of
the property or assets of PacifiCorp, the Borrower, Newco, a
Significant Subsidiary or any such group of subsidiaries of the
Borrower or (iii) the winding-up or liquidation of PacifiCorp, the
Borrower, Newco or any Significant Subsidiary (or any group of
subsidiaries of the Borrower which, if considered in the aggregate as a
single subsidiary, would constitute a Significant Subsidiary); and such
proceeding or petition shall continue undismissed for 60 days or an
order or decree approving or ordering any of the foregoing shall be
entered;
(h) PacifiCorp, the Borrower, Newco or any Significant
Subsidiary (or any group of subsidiaries of the Borrower which, if
considered in the aggregate as a single subsidiary, would constitute a
Significant Subsidiary) shall (i) voluntarily commence any proceeding
or file any petition seeking relief under Title 11 of the United States
Code, as now constituted or hereafter amended, or any other Federal,
state or foreign bankruptcy, insolvency, receivership or similar law,
(ii) consent to the institution of, or fail to contest in a timely and
appropriate manner, any proceeding or the filing of any petition
described in paragraph (g) above, (iii) apply for or consent to the
appointment of a receiver, trustee, custodian, sequestrator,
conservator or similar official for PacifiCorp, the Borrower, Newco,
any Significant Subsidiary or any such group of subsidiaries of the
Borrower or for a substantial part of the property or assets of
PacifiCorp, the Borrower, Newco, any Significant Subsidiary or any such
group of subsidiaries of the Borrower, (iv) file an answer admitting
the material allegations of a petition filed against it in any such
proceeding, (v) make a general assignment for the benefit of creditors,
(vi) become unable, admit in writing its inability or fail generally to
pay its debts as they become due or (vii) take any action for the
purpose of effecting any of the foregoing;
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(i) one or more judgments for the payment of money in an
aggregate amount in excess of $50,000,000 shall be rendered against the
Borrower, any Restricted Subsidiary or any combination thereof and the
same shall remain undischarged for a period of 30 consecutive days
during which execution shall not be effectively stayed, or any action
shall be legally taken by a judgment creditor to levy upon assets or
properties of the Borrower or any Restricted Subsidiary to enforce any
such judgment;
(j) an ERISA Event shall have occurred that, in the opinion of
the Required Lenders, when taken together with all other such ERISA
Events, could reasonably be expected to have a Material Adverse Effect;
(k) the security interest purported to be created by the
Pledge Agreement shall cease to be, or shall be asserted by the
Borrower not to be, a valid, perfected, first priority (except as
otherwise expressly provided in this Agreement or the Pledge Agreement)
security interest with respect to a material portion of the Collateral,
except to the extent that any such loss of perfection or priority
results from an act or failure to act by the Collateral Agent; or
(l) there shall have occurred a Change in Control;
then, at any time during the continuance of such event (other than an event with
respect to the Borrower described in paragraph (g) or (h) above), the Paying
Agent may, and at the request of the Required Lenders shall, by notice to the
Borrower, take either or both of the following actions, at the same or different
times: (i) terminate forthwith the Commitments and (ii) declare the Loans then
outstanding to be forthwith due and payable in whole or in part, whereupon the
principal of the Loans so declared to be due and payable, together with accrued
interest thereon and any unpaid accrued Fees and all other liabilities of the
Borrower accrued hereunder and under any other Loan Document, shall become
forthwith due and payable, without presentment, demand, protest or any other
notice of any kind, all of which are hereby expressly waived by the Borrower,
anything contained herein or in any other Loan Document to the contrary
notwithstanding; provided that (A) in any event with respect to the Borrower
described in paragraph (g) or (h) above, the Commitments shall automatically
terminate and the principal of the Loans then outstanding, together with accrued
interest thereon and any unpaid accrued Fees and all other liabilities of the
Borrower accrued hereunder and under any other Loan Document, shall
automatically become due and payable, without presentment, demand, protest or
any other notice of any kind, all of which are hereby expressly waived by the
Borrower, anything contained herein or in any other Loan Document to the
contrary notwithstanding and (B) except as described in the immediately
preceding clause (A), during the period commencing with the Closing Date and
ending on the earlier of (x) the date of the initial Acquisition Borrowing and
(y) the Termination Date, the Paying Agent and the Lenders shall not be entitled
to terminate the Commitments, rescind this Agreement or seek to enjoin any use
of proceeds of the Loans permitted hereby without the consent of the Borrower.
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ARTICLE VIII
The Paying Agent and the Collateral Agent
In order to expedite the transactions contemplated by this Agreement,
Citibank is hereby appointed to act as Paying Agent on behalf of the Lenders and
as the Issuing Bank, and Citicorp USA is hereby appointed to act as Collateral
Agent on behalf of the Lenders (for purposes of this Article VIII, the Paying
Agent and the Collateral Agent are referred to collectively as the "Agents").
Each of the Lenders and each assignee of any such Lender and the Issuing Bank,
hereby irrevocably authorizes the Agents to take such actions on behalf of such
Lender or assignee or the Issuing Bank and to exercise such powers as are
specifically delegated to the Agents by the terms and provisions hereof and of
the other Loan Documents, together with such actions and powers as are
reasonably incidental thereto. The Paying Agent is hereby expressly authorized
by the Lenders and the Issuing Bank, without hereby limiting any implied
authority, (a) to receive on behalf of the Lenders and the Issuing Bank all
payments of principal of and interest on the Loans, all payments in respect of
L/C Disbursements and all other amounts due to the Lenders hereunder, and
promptly to distribute to each Lender or the Issuing Bank its proper share of
each payment so received; (b) to give notice on behalf of each of the Lenders to
the Borrower of any Event of Default specified in this Agreement of which the
Paying Agent has actual knowledge acquired in connection with its agency
hereunder; and (c) to distribute to each Lender copies of all notices, financial
statements and other materials delivered by the Borrower pursuant to this
Agreement or the other Loan Documents as received by the Paying Agent. Without
limiting the generality of the foregoing, the Agents are hereby expressly
authorized to execute any and all documents (including releases) with respect to
the Collateral and the rights of the Secured Parties with respect thereto, as
contemplated by and in accordance with the provisions of this Agreement and the
Pledge Agreement.
Neither the Agents nor any of their respective directors, officers,
employees or agents shall be liable as such for any action taken or omitted by
any of them except for its or his own gross negligence or wilful misconduct, or
be responsible for any statement, warranty or representation herein or the
contents of any document delivered in connection herewith, or be required to
ascertain or to make any inquiry concerning the performance or observance by the
Borrower of any of the terms, conditions, covenants or agreements contained in
any Loan Document. The Agents shall not be responsible to the Lenders for the
due execution, genuineness, validity, enforceability or effectiveness of this
Agreement or any other Loan Documents, instruments or agreements. The Agents
shall in all cases be fully protected in acting, or refraining from acting, in
accordance with written instructions signed by the Required Lenders and, except
as otherwise specifically provided herein, such instructions and any action or
inaction pursuant thereto shall be binding on all the Lenders. Each Agent shall,
in the absence of knowledge to the contrary, be entitled to rely on any
instrument or document believed by it in good faith to be genuine and correct
and to have been signed or sent by the proper person or persons. Neither the
Agents nor any of their respective directors, officers, employees or agents
shall have any responsibility to the Borrower on account of the failure of or
delay in performance or breach by any Lender or the Issuing Bank of any of their
respective obligations hereunder or to any Lender or the Issuing Bank on account
of the failure of or delay in performance or breach by any other Lender or the
Issuing Bank or the Borrower of any of their respective obligations hereunder or
under any other Loan Document or in connection herewith or therewith. Each of
the Agents may execute any and all duties hereunder by or through agents or
employees and shall be entitled to rely upon the advice of legal counsel
selected by it with respect to
62
all matters arising hereunder and shall not be liable for any action taken or
suffered in good faith by it in accordance with the advice of such counsel.
The Lenders hereby acknowledge that neither Agent shall be under any
duty to take any discretionary action permitted to be taken by it pursuant to
the provisions of this Agreement unless it shall be requested in writing to do
so by the Required Lenders.
Subject to the appointment and acceptance of a successor Agent as
provided below, either Agent may resign at any time by notifying the Lenders and
the Borrower. Upon any such resignation, the Required Lenders shall have the
right to appoint a successor, subject to the prior consent of the Borrower (not
to be unreasonably withheld). If no successor shall have been so appointed by
the Required Lenders and shall have accepted such appointment within 30 days
after the retiring Agent gives notice of its resignation, then the retiring
Agent may, on behalf of the Lenders, appoint a successor Agent, subject to the
prior consent of the Borrower (not to be unreasonably withheld), which shall be
a bank with an office in New York, New York, having a combined capital and
surplus of at least $500,000,000 or an Affiliate of any such bank. Upon the
acceptance of any appointment as Agent hereunder by a successor bank, such
successor shall succeed to and become vested with all the rights, powers,
privileges and duties of the retiring Agent and the retiring Agent shall be
discharged from its duties and obligations hereunder. After the Agent's
resignation hereunder, the provisions of this Article and Section 9.05 shall
continue in effect for its benefit in respect of any actions taken or omitted to
be taken by it while it was acting as Agent.
With respect to the Loans made by it hereunder, each Agent in its
individual capacity and not as Agent shall have the same rights and powers as
any other Lender and may exercise the same as though it were not an Agent, and
the Agents and their Affiliates may accept deposits from, lend money to and
generally engage in any kind of business with the Borrower or any Restricted
Subsidiary or other Affiliate thereof as if it were not an Agent.
Each Lender agrees (a) to reimburse the Agents, on demand, in the
amount of its pro rata share (based on its Commitments hereunder) of any
expenses incurred for the benefit of the Lenders by the Agents, including
counsel fees and compensation of agents and employees paid for services rendered
on behalf of the Lenders, that shall not have been reimbursed by the Borrower
and (b) to indemnify and hold harmless each Agent and any of its directors,
officers, employees or agents, on demand, in the amount of such pro rata share,
from and against any and all liabilities, taxes, obligations, losses, damages,
penalties, actions, judgments, suits, costs, expenses or disbursements of any
kind or nature whatsoever that may be imposed on, incurred by or asserted
against it in its capacity as Agent or any of them in any way relating to or
arising out of this Agreement or any other Loan Document or any action taken or
omitted by it or any of them under this Agreement or any other Loan Document, to
the extent the same shall not have been reimbursed by the Borrower, provided
that no Lender shall be liable to an Agent or any such other indemnified person
for any portion of such liabilities, obligations, losses, damages, penalties,
actions, judgments, suits, costs, expenses or disbursements determined by a
court of competent jurisdiction by final and nonappealable judgment to have
resulted from the gross negligence or wilful misconduct of such Agent or any of
its directors, officers, employees or agents. Each Revolving Credit Lender
agrees to reimburse the Issuing Bank and its directors, employees and agents to
the same extent and subject to the same limitations as provided above for the
Agents.
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Each Lender acknowledges that it has, independently and without
reliance upon the Agents or any other Lender and based on such documents and
information as it has deemed appropriate, made its own credit analysis and
decision to enter into this Agreement. Each Lender also acknowledges that it
will, independently and without reliance upon the Agents or any other Lender and
based on such documents and information as it shall from time to time deem
appropriate, continue to make its own decisions in taking or not taking action
under or based upon this Agreement or any other Loan Document, any related
agreement or any document furnished hereunder or thereunder.
ARTICLE IX
Miscellaneous
SECTION 9.01. Notices. Notices and other communications provided for
herein shall be in writing and shall be delivered by hand or overnight courier
service, mailed by certified or registered mail or sent by telecopy, as follows:
(a) if to the Borrower, to it at 000 XX Xxxxxxxxx, Xxxxx 0000,
Xxxxxxxx, Xxxxxx 00000, Attention of Xxxxxxx X. Xxxxxxxxx-Vice
President and Treasurer (Telecopy No. (000) 000-0000), with a copy to
Stoel Rives LLP at 000 XX Xxxxxxxxx, Xxxxx 000, Xxxxxxxx, Xxxxxx 00000,
Attention of Xxxx X. Xxxxxxxxxx, Esq. (Telecopy No. (000) 000-0000);
(b) if to the Paying Agent, to Citibank, N.A., 000 Xxxx
Xxxxxx, Xxx Xxxx, Xxx Xxxx 00000, Attention of Xxxxxx Xxx (Telecopy No.
(000) 000-0000); and
(c) if to a Lender, to it at its address (or telecopy number)
set forth on Schedule 2.01 or in the Assignment and Acceptance pursuant
to which such Lender shall have become a party hereto.
All notices and other communications given to any party hereto in accordance
with the provisions of this Agreement shall be deemed to have been given on the
date of receipt if delivered by hand or overnight courier service or sent by
telecopy or on the date five Business Days after dispatch by certified or
registered mail if mailed, in each case delivered, sent or mailed (properly
addressed) to such party as provided in this Section 9.01 or in accordance with
the latest unrevoked direction from such party given in accordance with this
Section 9.01.
SECTION 9.02. Survival of Agreement. All covenants, agreements,
representations and warranties made by the Borrower herein and in the
certificates or other instruments prepared or delivered in connection with or
pursuant to this Agreement or any other Loan Document shall be considered to
have been relied upon by the Lenders and the Issuing Bank and shall survive the
making by the Lenders of the Loans and the issuance of Letters of Credit by the
Issuing Bank, regardless of any investigation made by the Lenders or the Issuing
Bank or on their behalf, and shall continue in full force and effect as long as
the principal of or any accrued interest on any Loan or any Fee or any other
amount payable under this Agreement or any other Loan Document is outstanding
and unpaid or any Letter of Credit is outstanding and so long as the Commitments
have not been terminated. The provisions of Sections 2.14, 2.16, 2.20 and 9.05
shall remain operative and in full force and effect
64
regardless of the expiration of the term of this Agreement, the consummation of
the transactions contemplated hereby, the repayment of any of the Loans, the
expiration of the Commitments, the expiration of any Letter of Credit, the
invalidity or unenforceability of any term or provision of this Agreement or any
other Loan Document, or any investigation made by or on behalf of the Paying
Agent, the Collateral Agent or any Lender or the Issuing Bank.
SECTION 9.03. Binding Effect. This Agreement shall become effective (a)
when it shall have been executed by the Borrower and the Paying Agent and when
the Paying Agent shall have received counterparts hereof which, when taken
together, bear the signatures of each of the other parties hereto, and (b) when
each of the conditions set forth in Section 4.01 shall have been satisfied or
waived in writing, and thereafter shall be binding upon and inure to the benefit
of the parties hereto and their respective permitted successors and assigns. By
its execution and delivery of the amendment and restatement of this Agreement,
the Borrower hereby confirms that the representations and warranties set forth
in Article III are true and correct in all material respects on the date of this
amendment and restatement with the same effect as though made on such date.
SECTION 9.04. Successors and Assigns. (a) Whenever in this Agreement
any of the parties hereto is referred to, such reference shall be deemed to
include the permitted successors and assigns of such party; and all covenants,
promises and agreements by or on behalf of the Borrower, the Paying Agent, the
Issuing Bank or the Lenders that are contained in this Agreement shall bind and
inure to the benefit of their respective successors and assigns.
(b) Each Lender may assign to one or more assignees all or a portion of
its interests, rights and obligations under this Agreement (including all or a
portion of its Commitment and the Loans at the time owing to it); provided,
however, that (i) except in the case of an assignment to a Lender or an
Affiliate of such Lender, (x) the Borrower (unless an Event of Default shall
have occurred and is continuing) and the Paying Agent (and, in the case of any
assignment of a Revolving Credit Commitment, the Issuing Bank) must give their
prior written consent to such assignment (which consent shall not be
unreasonably withheld) and (y) the amount of the Commitment of the assigning
Lender subject to each such assignment (determined as of the date the Assignment
and Acceptance with respect to such assignment is delivered to the Paying Agent)
shall not be less than $5,000,000 (or, if less, the entire remaining amount of
such Lender's Commitment), (ii) the parties to each such assignment shall
execute and deliver to the Paying Agent an Assignment and Acceptance, together
with a processing and recordation fee of $3,500 (except for assignments by any
Initial Lender or as otherwise agreed to by the Paying Agent) and (iii) the
assignee, if it shall not be a Lender, shall deliver to the Paying Agent an
Administrative Questionnaire. Upon acceptance and recording pursuant to
paragraph (e) of this Section 9.04, from and after the effective date specified
in each Assignment and Acceptance, which effective date shall be at least five
Business Days after the execution thereof, (A) the assignee thereunder shall be
a party hereto and, to the extent of the interest assigned by such Assignment
and Acceptance, have the rights and obligations of a Lender under this Agreement
and (B) the assigning Lender thereunder shall, to the extent of the interest
assigned by 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 Lender shall cease to be a party hereto but shall
continue to be entitled to the benefits of Sections 2.14, 2.16, 2.20 and 9.05,
as well as to any Fees accrued for its account and not yet paid).
65
(c) By executing and delivering an Assignment and Acceptance, the
assigning Lender thereunder and the assignee thereunder shall be deemed to
confirm to and agree with each other and the other parties hereto as follows:
(i) such assigning Lender warrants that it is the legal and beneficial owner of
the interest being assigned thereby free and clear of any adverse claim and that
its Term Loan Commitment and Revolving Credit Commitment, and the outstanding
balances of its Term Loans and Revolving Loans, in each case without giving
effect to assignments thereof which have not become effective, are as set forth
in such Assignment and Acceptance, (ii) except as set forth in (i) above, such
assigning Lender makes no representation or warranty and assumes no
responsibility with respect to any statements, warranties or representations
made in or in connection with this Agreement, or the execution, legality,
validity, enforceability, genuineness, sufficiency or value of this Agreement,
any other Loan Document or any other instrument or document furnished pursuant
hereto, or the financial condition of the Borrower or any Restricted Subsidiary
or the performance or observance by the Borrower or any Restricted Subsidiary of
any of its obligations under this Agreement, any other Loan Document or any
other instrument or document furnished pursuant hereto; (iii) such assignee
represents and warrants that it is legally authorized to enter into such
Assignment and Acceptance; (iv) such assignee confirms that it has received a
copy of this Agreement, together with copies of the most recent financial
statements referred to in Section 3.04 or delivered pursuant to Section 5.04 and
such other documents and information as it has deemed appropriate to make its
own credit analysis and decision to enter into such Assignment and Acceptance;
(v) such assignee will independently and without reliance upon the Paying Agent,
the Collateral Agent, such assigning Lender or any other Lender and based on
such documents and information as it shall deem appropriate at the time,
continue to make its own credit decisions in taking or not taking action under
this Agreement; (vi) such assignee appoints and authorizes the Paying Agent and
the Collateral Agent to take such action as agent on its behalf and to exercise
such powers under this Agreement as are delegated to the Paying Agent and the
Collateral Agent, respectively, by the terms hereof, together with such powers
as are reasonably incidental thereto; and (vii) such assignee agrees that it
will perform in accordance with their terms all the obligations which by the
terms of this Agreement are required to be performed by it as a Lender.
(d) The Paying Agent, acting for this purpose as an agent of the
Borrower, shall maintain at one of its offices in The City of New York a copy of
each Assignment and Acceptance delivered to it and a register for the
recordation of the names and addresses of the Lenders, and the Commitment of,
and principal amount of the Loans owing to, each Lender pursuant to the terms
hereof from time to time (the "Register"). The entries in the Register shall be
conclusive and the Borrower, the Paying Agent, the Issuing Bank, the Collateral
Agent and the Lenders may treat each person whose name is recorded in the
Register pursuant to the terms hereof as a Lender hereunder for all purposes of
this Agreement, notwithstanding notice to the contrary. The Register shall be
available for inspection by the Borrower, the Issuing Bank, the Collateral Agent
and any Lender, at any reasonable time and from time to time upon reasonable
prior notice.
(e) Upon its receipt of a duly completed Assignment and Acceptance
executed by an assigning Lender and an assignee, an Administrative Questionnaire
completed in respect of the assignee (unless the assignee shall already be a
Lender hereunder), the processing and recordation fee referred to in paragraph
(b) above and, if required, the written consent of the Borrower, the Paying
Agent and the Issuing Bank to such assignment, the Paying Agent shall (i) accept
such Assignment and Acceptance, (ii) record the information contained therein in
the Register and (iii) give prompt
66
notice thereof to the Lenders and the Issuing Bank. No assignment shall be
effective unless it has been recorded in the Register as provided in this
paragraph (e).
(f) Each Lender may without the consent of the Borrower, the Issuing
Bank or the Paying Agent sell participations to one or more banks or other
entities in all or a portion of its rights and obligations under this Agreement
(including all or a portion of its Commitment and the Loans owing to it);
provided, however, that (i) such Lender's obligations under this Agreement shall
remain unchanged, (ii) such Lender shall remain solely responsible to the other
parties hereto for the performance of such obligations, (iii) the participating
banks or other entities shall be entitled to the benefit of the cost protection
provisions contained in Sections 2.14, 2.16 and 2.20 to the same extent as if
they were Lenders (provided that a participant shall not be entitled to receive
any greater payment under Sections 2.14, 2.16 and 2.20 than the applicable
Lender would have been entitled to receive with respect to the participation
sold to such participant, unless the sale of such participation is made with the
Borrower's prior written consent) and (iv) the Borrower, the Paying Agent, the
Issuing Bank and the Lenders shall continue to deal solely and directly with
such Lender in connection with such Lender's rights and obligations under this
Agreement, and such Lender shall retain the sole right to enforce the
obligations of the Borrower relating to the Loans or L/C Disbursements and to
approve any amendment, modification or waiver of any provision of this Agreement
(other than amendments, modifications or waivers decreasing any fees payable
hereunder or the amount of principal of or the rate at which interest is payable
on the Loans, extending any scheduled principal payment date or date fixed for
the payment of interest on the Loans or increasing or extending the
Commitments).
(g) Any Lender or participant may, in connection with any assignment or
participation or proposed assignment or participation pursuant to this Section
9.04, disclose to the assignee or participant or proposed assignee or
participant any information relating to the Borrower furnished to such Lender by
or on behalf of the Borrower; provided that, prior to any such disclosure of
information designated by the Borrower as confidential, each such assignee or
participant or proposed assignee or participant shall execute an agreement
whereby such assignee or participant shall agree (subject to customary
exceptions) to preserve the confidentiality of such confidential information on
terms no less restrictive than those applicable to the Lenders pursuant to
Section 9.16.
(h) Any Lender may at any time assign all or any portion of its rights
under this Agreement to a Federal Reserve Bank to secure extensions of credit by
such Federal Reserve Bank to such Lender; provided that no such assignment shall
release a Lender from any of its obligations hereunder or substitute any such
Bank for such Lender as a party hereto. In order to facilitate such an
assignment to a Federal Reserve Bank, the Borrower shall, at the request of the
assigning Lender, duly execute and deliver to the assigning Lender a promissory
note or notes evidencing the Loans made to the Borrower by the assigning Lender
hereunder.
(i) The Borrower shall not assign or delegate any of its rights or
duties hereunder without the prior written consent of the Paying Agent, the
Issuing Bank and each Lender, and any attempted assignment without such consent
shall be null and void.
SECTION 9.05. Expenses; Indemnity. (a) The Borrower agrees to pay all
reasonable out-of-pocket expenses incurred by the Initial Lenders, the Paying
Agent, the Collateral Agent and the Issuing Bank in connection with the
arrangement of the credit facilities provided for herein and the
67
preparation and administration of this Agreement and the other Loan Documents or
in connection with any amendments, modifications or waivers of the provisions
hereof or thereof (whether or not the transactions hereby or thereby
contemplated shall be consummated) or incurred by the Initial Lenders, the
Paying Agent, the Collateral Agent or (after the occurrence and during the
continuance of an Event of Default) any other Lender in connection with the
enforcement of its rights in connection with this Agreement and the other Loan
Documents or in connection with the Loans made or Letters of Credit issued
hereunder, including the reasonable fees, charges and disbursements of Cravath,
Swaine & Xxxxx, counsel for the Paying Agent and the Collateral Agent, and, in
connection with any such enforcement, the reasonable fees, charges and
disbursements of any other counsel for the Paying Agent, the Collateral Agent or
any Lender.
(b) The Borrower agrees to indemnify the Initial Lenders, the Paying
Agent, the Collateral Agent, each other Lender and the Issuing Bank, each
Affiliate of any of the foregoing persons and each of their respective
directors, officers, partners, employees and agents (each such person being
called an "Indemnitee") against, and to hold each Indemnitee harmless from, any
and all losses, claims, damages, liabilities and related expenses, including
reasonable counsel fees, charges and disbursements, incurred by or asserted
against any Indemnitee arising out of, in any way connected with, or as a result
of any claim, litigation, investigation or proceeding (whether or not an
Indemnitee is a party thereto) relating to (i) the execution or delivery of this
Agreement or any other Loan Document or any agreement or instrument contemplated
thereby, the performance by the parties thereto of their respective obligations
thereunder or the consummation of the Transactions and the other transactions
contemplated thereby, the use of the proceeds of the Loans or issuance of
Letters of Credit, whether or not any Indemnitee is a party thereto, or (ii) any
actual or alleged presence or Release of Hazardous Materials on any property
owned or operated by the Borrower or any of the Restricted Subsidiaries, or any
Environmental Claim related in any way to the Borrower or the Restricted
Subsidiaries; provided that such indemnity shall not, as to any Indemnitee, be
available to the extent that such losses, claims, damages, liabilities or
related expenses are determined by a court of competent jurisdiction by final
and nonappealable judgment to have resulted from the gross negligence or wilful
misconduct of such Indemnitee.
(c) The provisions of this Section 9.05 shall remain operative and in
full force and effect regardless of the expiration of the term of this
Agreement, the consummation of the transactions contemplated hereby, the
repayment of any of the Loans, the expiration of the Commitments, the expiration
of any Letter of Credit, the invalidity or unenforceability of any term or
provision of this Agreement or any other Loan Document, or any investigation
made by or on behalf of the Paying Agent, the Collateral Agent, any Lender or
the Issuing Bank. All amounts due under this Section 9.05 shall be payable on
written demand therefor.
SECTION 9.06. Right of Setoff. If an Event of Default shall
have occurred and be continuing, each Lender is hereby authorized at any time
and from time to time, except to the extent prohibited by law, to set off and
apply any and all deposits (general or special, time or demand, provisional or
final) at any time held and other indebtedness at any time owing by such Lender
to or for the credit or the account of the Borrower against any of and all the
obligations of the Borrower now or hereafter existing under this Agreement and
other Loan Documents held by such Lender, irrespective of whether or not such
Lender shall have made any demand under this Agreement or such other Loan
Document and although such obligations may be unmatured. Promptly after
exercising its rights under this Section 9.06, the applicable Lender shall
notify the Paying Agent and the
68
Borrower of the exercise of such rights. The rights of each Lender under this
Section 9.06 are in addition to other rights and remedies (including other
rights of setoff) which such Lender may have.
SECTION 9.07. APPLICABLE LAW. THIS AGREEMENT AND THE OTHER
LOAN DOCUMENTS (OTHER THAN LETTERS OF CREDIT AND AS EXPRESSLY SET FORTH IN OTHER
LOAN DOCUMENTS) SHALL BE CONSTRUED IN ACCORDANCE WITH AND GOVERNED BY THE LAWS
OF THE STATE OF NEW YORK. EACH LETTER OF CREDIT SHALL BE GOVERNED BY, AND SHALL
BE CONSTRUED IN ACCORDANCE WITH, THE LAWS OR RULES DESIGNATED IN SUCH LETTER OF
CREDIT, OR IF NO SUCH LAWS OR RULES ARE DESIGNATED, THE UNIFORM CUSTOMS AND
PRACTICE FOR DOCUMENTARY CREDITS (1993 REVISION), INTERNATIONAL CHAMBER OF
COMMERCE, PUBLICATION NO. 500 (THE "UNIFORM CUSTOMS") AND, AS TO MATTERS NOT
GOVERNED BY THE UNIFORM CUSTOMS, THE LAWS OF THE STATE OF NEW YORK.
SECTION 9.08. Waivers; Amendment. (a) No failure or delay of
the Paying Agent, the Collateral Agent, any Lender or the Issuing Bank in
exercising any power or right hereunder or under any other Loan Document shall
operate as a waiver thereof, nor shall any single or partial exercise of any
such right or power, or any abandonment or discontinuance of steps to enforce
such a right or power, preclude any other or further exercise thereof or the
exercise of any other right or power. The rights and remedies of the Paying
Agent, the Collateral Agent, the Issuing Bank and the Lenders hereunder and
under the other Loan Documents are cumulative and are not exclusive of any
rights or remedies that they would otherwise have. No waiver of any provision of
this Agreement or any other Loan Document or consent to any departure by the
Borrower therefrom shall in any event be effective unless the same shall be
permitted by paragraph (b) below, and then such waiver or consent shall be
effective only in the specific instance and for the purpose for which given. No
notice or demand on the Borrower in any case shall entitle the Borrower to any
other or further notice or demand in similar or other circumstances.
(b) Neither this Agreement nor any provision hereof may be
waived, amended or modified except pursuant to an agreement or agreements in
writing entered into by the Borrower and the Required Lenders; provided,
however, that no such agreement shall (i) decrease the principal amount of, or
extend the maturity of or any scheduled principal payment date or date for the
payment of any interest on any Loan or any date for reimbursement of an L/C
Disbursement, or waive or excuse any such payment or any part thereof, or
decrease the rate of interest on any Loan or L/C Disbursement, without the prior
written consent of each Lender affected thereby, (ii) change or extend the
Commitment or decrease or extend the date for payment of the Commitment Fees of
any Lender without the prior written consent of such Lender or (iii) amend or
modify the pro rata requirements of the provisions of Section 2.17, amend or
modify the provisions of Section 9.04(i), the provisions of this Section, the
definition of the term "Required Lenders" or release all or any substantial part
of the Collateral (except for any release expressly permitted by the Loan
Documents), without the prior written consent of each Lender; provided further
that no such agreement shall amend, modify or otherwise affect the rights or
duties of the Paying Agent, the Collateral Agent or the Issuing Bank hereunder
or under any other Loan Document without the prior written consent of the Paying
Agent, the Collateral Agent or the Issuing Bank.
SECTION 9.09. Interest Rate Limitation. Notwithstanding
anything herein to the contrary, if at any time the interest rate applicable to
any Loan or participation in any L/C
69
Disbursement, together with all Fees, charges and other amounts which are
treated as interest on such Loan or participation in such L/C Disbursement under
applicable law (collectively the "Charges"), shall exceed the maximum lawful
rate (the "Maximum Rate") which may be contracted for, charged, taken, received
or reserved by the Lender holding such Loan or participation in accordance with
applicable law, the rate of interest payable in respect of such Loan or
participation hereunder, together with all Charges payable in respect thereof,
shall be limited to the Maximum Rate and, to the extent lawful, the interest and
Charges that would have been payable in respect of such Loan or participation
but were not payable as a result of the operation of this Section 9.09 shall be
cumulated and the interest and Charges payable to such Lender in respect of
other Loans or participations or periods shall be increased (but not above the
Maximum Rate therefor) until such cumulated amount, together with interest
thereon at the Federal Funds Effective Rate to the date of repayment, shall have
been received by such Lender.
SECTION 9.10. Entire Agreement. This Agreement and the other
Loan Documents constitute the entire contract between the parties relative to
the subject matter hereof. Any other previous agreement among the parties with
respect to the subject matter hereof is superseded by this Agreement and the
other Loan Documents. Nothing in this Agreement or in the other Loan Documents,
expressed or implied, is intended to confer upon any party other than the
parties hereto and thereto any rights, remedies, obligations or liabilities
under or by reason of this Agreement or the other Loan Documents.
SECTION 9.11. WAIVER OF JURY TRIAL. EACH PARTY HERETO HEREBY
WAIVES, TO THE FULLEST EXTENT PERMITTED BY APPLICABLE LAW, ANY RIGHT IT MAY HAVE
TO A TRIAL BY JURY IN RESPECT OF ANY LITIGATION DIRECTLY OR INDIRECTLY ARISING
OUT OF, UNDER OR IN CONNECTION WITH THIS AGREEMENT OR ANY OF THE OTHER LOAN
DOCUMENTS. EACH PARTY HERETO (A) CERTIFIES THAT NO REPRESENTATIVE, AGENT OR
ATTORNEY OF ANY OTHER PARTY HAS REPRESENTED, EXPRESSLY OR OTHERWISE, THAT SUCH
OTHER PARTY WOULD NOT, IN THE EVENT OF LITIGATION, SEEK TO ENFORCE THE FOREGOING
WAIVER AND (B) ACKNOWLEDGES THAT IT AND THE OTHER PARTIES HERETO HAVE BEEN
INDUCED TO ENTER INTO THIS AGREEMENT AND THE OTHER LOAN DOCUMENTS, AS
APPLICABLE, BY, AMONG OTHER THINGS, THE MUTUAL WAIVERS AND CERTIFICATIONS IN
THIS SECTION 9.11.
SECTION 9.12. Severability. In the event any one or more of
the provisions contained in this Agreement or in any other Loan Document should
be held invalid, illegal or unenforceable in any respect, the validity, legality
and enforceability of the remaining provisions contained herein and therein
shall not in any way be affected or impaired thereby (it being understood that
the invalidity of a particular provision in a particular jurisdiction shall not
in and of itself affect the validity of such provision in any other
jurisdiction). The parties shall endeavor in good-faith negotiations to replace
the invalid, illegal or unenforceable provisions with valid provisions the
economic effect of which comes as close as possible to that of the invalid,
illegal or unenforceable provisions.
SECTION 9.13. Counterparts. This Agreement may be executed in
counterparts (and by different parties hereto on different counterparts), each
of which shall constitute an original but all of which when taken together shall
constitute a single contract, and shall become effective as
70
provided in Section 9.03. Delivery of an executed signature page to this
Agreement by facsimile transmission shall be as effective as delivery of a
manually signed counterpart of this Agreement.
SECTION 9.14. Headings. Article and Section headings and the
Table of Contents used herein are for convenience of reference only, are not
part of this Agreement and are not to affect the construction of, or to be taken
into consideration in interpreting, this Agreement.
SECTION 9.15. Jurisdiction; Consent to Service of Process. (a)
The Borrower hereby irrevocably and unconditionally submits, for itself and its
property, to the nonexclusive jurisdiction of any New York State court or
Federal court of the United States of America sitting in New York City, and any
appellate court from any thereof, in any action or proceeding arising out of or
relating to this Agreement or the other Loan Documents, or for recognition or
enforcement of any judgment, and each of the parties hereto hereby irrevocably
and unconditionally agrees that all claims in respect of any such action or
proceeding may be heard and determined in such New York State or, to the extent
permitted by law, in such Federal court. Each of the parties hereto agrees that
a final judgment in any such action or proceedings shall be conclusive and may
be enforced in other jurisdictions by suit on the judgment or in any other
manner provided by law. Nothing in this Agreement shall affect any right that
the Paying Agent, the Collateral Agent, the Issuing Bank or any Lender may
otherwise have to bring any action or proceeding relating to this Agreement or
the other Loan Documents against the Borrower or its properties in the courts of
any jurisdiction.
(b) The Borrower hereby irrevocably and unconditionally
waives, to the fullest extent it may legally and effectively do so, any
objection which it may now or hereafter have to the laying of venue of any suit,
action or proceeding arising out of or relating to this Agreement or the other
Loan Documents in any New York State or Federal court. Each of the parties
hereto hereby irrevocably waives, to the fullest extent permitted by law, the
defense of an inconvenient forum to the maintenance of such action or proceeding
in any such court.
(c) Each party to this Agreement irrevocably consents to
service of process in the manner provided for notices in Section 9.01. Nothing
in this Agreement will affect the right of any party to this Agreement to serve
process in any other manner permitted by law.
SECTION 9.16. Confidentiality. The Paying Agent, the Collateral Agent,
the Issuing Bank and each of the Lenders agrees to keep confidential (and to use
its best efforts to cause its respective agents and representatives to keep
confidential) the Information (as defined below) and all copies thereof,
extracts therefrom and analyses or other materials based thereon, except that
the Paying Agent, the Collateral Agent, the Issuing Bank or any Lender shall be
permitted to disclose Information (a) to such of its respective officers,
directors, employees, agents, affiliates and representatives as need to know
such Information, (b) to the extent requested by any regulatory authority, (c)
to the extent otherwise required by applicable laws and regulations or by any
subpoena or similar legal process, (d) in connection with any suit, action or
proceeding relating to the enforcement of its rights hereunder or under the
other Loan Documents or (e) to the extent such Information (i) becomes publicly
available other than as a result of a breach of this Section 9.16 or (ii)
becomes available to the Paying Agent, any Lender, the Issuing Bank or the
Collateral Agent on a nonconfidential basis from a source other than the
Borrower. For the purposes of this Section, "Information" shall mean all
financial statements, certificates, reports, agreements and information
(including all analyses, compilations and studies prepared by the Paying Agent,
the Collateral Agent, the Issuing Bank or any Lender based on any of the
foregoing) that are received from the Borrower and related to the Borrower, any
shareholder of the Borrower or any employee, customer or supplier of the
Borrower other than any of the foregoing that were available to the Paying
Agent, the Collateral Agent, the
71
Issuing Bank or any Lender on a nonconfidential basis prior to its disclosure
thereto by the Borrower, and which are in the case of Information provided after
the Closing Date, clearly identified at the time of delivery as confidential.
The provisions of this Section 9.16 shall remain operative and in full force and
effect regardless of the expiration of this Agreement.
SECTION 9.17. Margin Regulations. Notwithstanding any other provision
contained in this Agreement or the Pledge Agreement, including Section 2.13(b),
Section 6.02 and Section 6.05, the pledge or sale of the Shares by Bidco shall
be permitted hereunder until the Depositary Shares have been delisted from the
New York Stock Exchange (and the Shares shall not otherwise be "margin stock" as
defined in Regulations G and U of the Board); provided that until such time the
Borrower shall use its reasonable efforts to cause Bidco not to:
(i) incur any Indebtedness other than (A) its obligations
under the Offer, (B) its obligations under the Powercoal/Bidco Loans
and (C) its obligations under or permitted under the Bidco Facility
Agreement;
(ii) engage in any business other than (A) acquiring and
holding the Shares and (B) engaging in activities reasonably related to
the Offer; or
(iii) sell or otherwise dispose of the Shares, unless (A)
such Shares are sold for cash, (B) fair value is received for such
Shares and (C) the proceeds of such sale are either held as cash or
invested in certificates of deposit, U.S. government securities,
commercial paper, other money market instruments that are exempted
securities under the United States federal securities laws or Cash
Investment Equivalents (as defined in the Bidco Facility Agreement).
IN WITNESS WHEREOF, the parties hereto have caused this Agreement to be
duly executed by their respective authorized officers as of the day and year
first above written.
PACIFICORP HOLDINGS, INC.,
by
/s/ Xxxxxxx X. Xxxxxxxxx
--------------------------------------
Name: Xxxxxxx X. Xxxxxxxxx
Title: Treasurer
72
CITIBANK, N.A., individually as an Initial
Lender and as Paying Agent and Issuing Bank,
by /s/ Xxxxxx Xxx
--------------------------------------
Name: Xxxxxx Xxx
Title: Managing Director, Attorney-in-Fact
CITICORP USA, INC., as Collateral Agent,
by /s/ Xxxxxx Xxx
--------------------------------------
Name: Xxxxxx Xxx
Title: Managing Director, Attorney-in-Fact
XXXXXXX XXXXX CREDIT PARTNERS L.P., individually
as an Initial Lender,
by /s/ Xxxxxx X. Xxxxx
--------------------------------------
Name: Xxxxxx X. Xxxxx
Title: Authorized Signatory
XXXXXX GUARANTY TRUST COMPANY OF
NEW YORK, individually as an Initial Lender,
by /s/ Xxxxxxx Xxxxx-Xxxxx
--------------------------------------
Name: Xxxxxxx Xxxxx-Xxxxx
Title: Vice President
