Exhibit 10(m)
CREDIT AGREEMENT
dated as of
December 30, 1997
among
TUCSON ELECTRIC POWER COMPANY
The Lenders Party Hereto
The Issuing Banks Party Hereto
THE BANK OF NEW YORK
as Syndication Agent
SOCIETE GENERALE
as Documentation Agent
and
TORONTO DOMINION (TEXAS), INC.,
as Administrative Agent
___________________________
TD SECURITIES (USA) INC.,
as Lead Arranger
THE BANK OF NEW YORK
and
SOCIETE GENERALE
as Co-Arrangers
CREDIT AGREEMENT dated as of December 30, 1997, among
TUCSON ELECTRIC POWER COMPANY, the LENDERS party hereto, the
ISSUING BANKS party hereto, THE BANK OF NEW YORK, as
Syndication Agent, SOCIETE GENERALE, as Documentation Agent,
and TORONTO DOMINION (TEXAS), INC., as Administrative Agent.
The parties hereto agree as follows:
ARTICLE I
Definitions
------------
SECTION 1.01. Defined Terms. As used in this Agreement, the
following terms have the meanings specified below:
"ABR", when used in reference to any Loan or Borrowing, refers to
whether such Loan, or the Loans comprising such Borrowing, are bearing
interest at a rate determined by reference to the Alternate Base Rate.
"ACC" means the Arizona Corporation Commission.
"Adjusted LIBO Rate" means, 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 (a) the LIBO Rate for
such Interest Period multiplied by (b) the Statutory Reserve Rate.
"Administrative Agent" means Toronto Dominion (Texas), Inc., in its
capacity as administrative agent for the Lenders hereunder.
"Administrative Questionnaire" means an Administrative
Questionnaire in a form supplied by the Administrative Agent.
"Affiliate" means, with respect to a specified Person, another
Person that directly, or indirectly through one or more intermediaries,
Controls or is Controlled by or is under common Control with the Person
specified.
"Agents" means the Administrative Agent, the Documentation Agent
and the Syndication Agent.
"Alternate Base Rate" means, for any day, a rate per annum 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%. Any change in the Alternate Base
Rate due to a change in the Prime Rate, the Base CD Rate or the Federal Funds
Effective Rate shall be effective from and including the effective date of
such change in the Prime Rate, the Base CD Rate or the Federal Funds
Effective Rate, respectively.
"Applicable Percentage" means, with respect to any Lender, the
percentage of the total LC Commitments, Revolving Commitments or Commitments,
as the case may be, represented by such Lender's LC Commitment, Revolving
Commitment or Commitment, respectively, as the context may require depending
on whether reference is made to a Lender's share of any rights or obligations
in respect of Letters of Credit, Revolving Loans or other matters. If any
such Commitments have terminated or expired, the Applicable Percentages shall
be determined based upon such Commitments most recently in effect, giving
effect to any assignments.
"Applicable Rate" means, for any day, with respect to any ABR Loan
or Eurodollar Revolving Loan, or with respect to the commitment fees payable
hereunder, as the case may be, the applicable rate per annum set forth below
under the caption "ABR Spread", "Eurodollar Spread" or "Commitment Fee Rate",
as the case may be, based upon the Reference Ratings on such date:
ABR Eurodollar Commitment Fee
Reference Ratings: ---- ----------- --------------
------------------- Spread Spread Rate
------ ------- ----
Category 1
----------
rating of BBB or 0.000% 0.500% 0.125%
Baa2 or better
Category 2
----------
rating of BBB- or 0.000% 0.750% 0.250%
Baa3
Category 3
-----------
rating of BB+ or Ba1 0.125% 1.125% 0.250%
Category 4
----------
rating of BB or Ba2 0.375% 1.375% 0.375%
Category 5
----------
rating of BB- or Ba3 0.625% 1.625% 0.375%
Category 6
----------
rating below BB- or 1.000% 2.000% 0.500%
Ba3
For purposes of the foregoing, (i) if any Rating Agency shall not
have in effect a rating for the Index Debt (other than by reason of the
circumstances referred to in the last sentence of this definition), then such
Rating Agency shall be deemed to have established a rating in Category 6;
(ii) if the Reference Ratings established or deemed to have been established
for the Index Debt shall fall within different Categories, the Applicable
Rate shall be based on the lower of the two Reference Ratings; and (iii) if
the rating established or deemed to have been established by any Rating
Agency for the Index Debt shall be changed (other than as a result of a
change in the rating system of such Rating Agency), such change shall be
effective as of the date on which it is first announced by the applicable
Rating Agency. Each change in the Applicable Rate shall apply during the
period commencing on the effective date of such change and ending on the date
immediately preceding the effective date of the next such change. If at the
time the Second Mortgage Bonds become the Index Debt, the rating given to the
Second Mortgage Bonds by any Rating Agency would indicate a Category (the
"Resulting Category") having a higher number than the Category indicated by
the rating given by such Rating Agency to the First Mortgage Bonds in effect
immediately prior to such time (the "Prior Category"), then at all times
thereafter until the rating given to the Second Mortgage Bonds by such Rating
Agency would be in the Prior Category, the Category indicated by the rating
from time to time given to the Second Mortgage Bonds thereafter shall be
deemed to be the Category indicated by such rating minus the difference
between the Resulting Category and the Prior Category. If the rating system
of any Rating Agency shall change, or if any such Rating Agency shall cease
to be in the business of rating corporate debt obligations, the Borrower and
the Lenders shall negotiate in good faith to amend this definition to reflect
such changed rating system or the unavailability of ratings from such Rating
Agency and, pending the effectiveness of any such amendment, the Applicable
Rate shall be determined using the rating of such Rating Agency most recently
in effect prior to such change or cessation.
"Assessment Rate" means, for any day, the annual assessment rate in
effect on such day that is payable by a member of the Bank Insurance Fund
classified as "well-capitalized" and within supervisory subgroup "B" (or a
comparable successor risk classification) within the meaning of 12 C.F.R.
Part 327 (or any successor provision) to the Federal Deposit Insurance
Corporation for insurance by such Corporation of time deposits made in
dollars at the offices of such member in the United States; provided that if,
as a result of any change in any law, rule or regulation, it is no longer
possible to determine the Assessment Rate as aforesaid, then the Assessment
Rate shall be such annual rate as shall be determined by the Administrative
Agent to be representative of the cost of such insurance to the Lenders.
"Assignment and Acceptance" means an assignment and acceptance
entered into by a Lender and an assignee (with the consent of any party whose
consent is required by Section 9.04), and accepted by the Administrative
Agent, in the form of Exhibit A or any other form approved by the
Administrative Agent.
"Availability Period" means the period from and including the
Effective Date to but excluding the earlier of the Maturity Date and the date
of termination of the Revolving Commitments.
"Base CD Rate" means the sum of (a) the Three-Month Secondary
CD Rate multiplied by the Statutory Reserve Rate plus (b) the Assessment
Rate.
"Board" means the Board of Governors of the Federal Reserve System
of the United States of America.
"Bond Delivery Agreement" means the Bond Delivery Agreement between
the Borrower and the Administrative Agent, substantially in the form of
Exhibit B.
"Bonds" means the First Mortgage Bonds and the Second Mortgage
Bonds.
"Borrower" means Tucson Electric Power Company, an Arizona
corporation.
"Borrowing" means Revolving Loans of the same Type, made, converted
or continued on the same date and, in the case of Eurodollar Loans, as to
which a single Interest Period is in effect.
"Borrowing Request" means a request by the Borrower for a Revolving
Borrowing in accordance with Section 2.03.
"Business Day" means any day that is not a Saturday, Sunday or
other day on which commercial banks in New York City are authorized or
required by law to remain closed; provided 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 Investment" of any Person means the aggregate
outstanding capitalized amount of Capital Lease Obligations of the Borrower
and the Consolidated Subsidiaries that are owned by such Person and in
respect of which such Person has the right to receive all future payments to
be made.
"Capital Lease Obligations" of any Person means 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.
"Change in Law" means (a) the adoption of any law, rule or
regulation after the date of this Agreement, (b) any change in any law, rule
or regulation or in the interpretation or application thereof by any
Governmental Authority after the date of this Agreement or (c) compliance by
any Lender or any Issuing Bank (or, for purposes of Section 2.15(b), by any
lending office of such Lender or by such Lender's or such Issuing Bank's
holding company, if any) with any request, guideline or directive (whether or
not having the force of law) of any Governmental Authority made or issued
after the date of this Agreement.
"Code" means the Internal Revenue Code of 1986, as amended from
time to time.
"Collateral" means the Collateral Mortgage Bonds and any and all
"Collateral", as defined in any applicable Security Document.
"Collateral Mortgage Bonds" means Second Mortgage Bonds, Collateral
Series B, substantially in the form attached to the Second Supplemental
Indenture.
"Commitment" means, with respect to each Lender, each of such
Lender's Revolving Commitment and LC Commitment.
"Consolidated Capital Expenditures" means, for any fiscal period,
the aggregate of all expenditures by the Borrower and the Consolidated
Subsidiaries for such period that, in accordance with GAAP, are or should be
included in "construction expenditures" or similar items for additions to
property, plant or equipment reflected in the statement of cash flows for the
Borrower and the Consolidated Subsidiaries, as determined on a consolidated
basis in accordance with GAAP.
"Consolidated Capital Lease Expense" means, for any fiscal period,
"capital lease expense" reflected in the statement of income of the Borrower
and the Consolidated Subsidiaries, all as determined on a consolidated basis
in accordance with GAAP.
"Consolidated EBITDA" means, for any fiscal period, with respect to
the Borrower and the Consolidated Subsidiaries, Consolidated Net Income for
such period (excluding the Borrower's share of earnings or losses of Excluded
Subsidiaries) plus, to the extent deducted in computing such Consolidated Net
Income, without duplication, the sum of (a) income tax expense, (b) interest
expense, (c) depreciation and amortization expense, (d) any extraordinary or
non-recurring losses and (e) other noncash items reducing Consolidated Net
Income, minus, to the extent added in computing such Consolidated Net Income,
without duplication, the sum of (i) interest income, (ii) any extraordinary
or non-recurring gains and (iii) other noncash items increasing Consolidated
Net Income, all as determined on a consolidated basis in accordance with
GAAP.
"Consolidated Interest Expense" means, for any fiscal period, the
aggregate of all payments by the Borrower and the Consolidated Subsidiaries
for such period that, in accordance with GAAP, are or should be included in
"interest paid, net of amounts capitalized" and "capital lease interest paid"
reflected in the statement of cash flows for the Borrower and the
Consolidated Subsidiaries, less the amount of capital lease interest paid to
the Borrower or any Consolidated Subsidiary for such period that is not
reflected in Consolidated EBITDA for such period, all as determined on a
consolidated basis in accordance with GAAP.
"Consolidated Net Income" means, for any fiscal period, net income
of the Borrower and the Consolidated Subsidiaries for such period, determined
on a consolidated basis in accordance with GAAP.
"Consolidated Subsidiary" means (a) San Xxxxxx and (b) each other
Subsidiary from time to time designated by the Borrower by written notice to
the Administrative Agent and the Lenders as a Consolidated Subsidiary.
"Consolidated Tangible Net Worth" means, as of the last day of any
fiscal quarter, (a) common stock equity of the Borrower as of such day minus
(b) the aggregate amount of all intangible assets (other than intangible
assets eligible for cost recovery through regulatory rates) on the
consolidated balance sheet of the Borrower and the Consolidated Subsidiaries
as of such day, all as determined on a consolidated basis in accordance with
GAAP.
"Consolidated Total Indebtedness" means, as of the last day of any
fiscal quarter, (a) the sum for the Borrower and the Consolidated
Subsidiaries as of such day of (i) the aggregate outstanding principal amount
of the Loans and LC Disbursements, (ii) the aggregate outstanding principal
amount of Indebtedness for borrowed money, (iii) the principal amount of all
obligations in respect of Hedging Agreements of the Borrower and the
Consolidated Subsidiaries (computed as set forth in the penultimate sentence
of the definition of "Material Indebtedness") and (iv) the aggregate
outstanding capitalized amount of Capital Lease Obligations, minus (b) the
aggregate outstanding capitalized amount of the Capital Lease Investments of
the Borrower and the Consolidated Subsidiaries as of such day, all as
determined on a consolidated basis in accordance with GAAP.
"Control" means 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 ability to exercise voting power, by contract or
otherwise. "Controlling" and "Controlled" have meanings correlative thereto.
"Credit Exposure" means, with respect to any Lender at any time,
the sum of such Lender's Revolving Credit Exposure and its LC Exposure at
such time.
"Default" means any event or condition which constitutes an Event
of Default or which upon notice, lapse of time or both would, unless cured or
waived, become an Event of Default.
"Disclosure Documents" means the Borrower's Annual Report on
Form 10-K dated December 31, 1996, the Borrower's Quarterly Reports on
Form 10-Q dated March 31, 1997, June 30, 1997, and September 30, 1997 and the
Borrower's Current Reports on Form 8-K/A dated November 19, 1997, and on
Form 8-K dated July 3, 1997, July 10, 1997, July 16, 1997, November 14, 1997,
November 17, 1997, and November 24, 1997, in each case, as filed with the
Securities and Exchange Commission.
"Documentation Agent" means Societe Generale, in its capacity as
documentation agent for the Lenders.
"dollars" or "$" refers to lawful money of the United States of
America.
"Effective Date" means the date on which the conditions specified
in Section 4.01 are satisfied (or waived in accordance with Section 9.02).
"Environmental Laws" means all 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 Liability" means any liability, contingent or
otherwise (including any liability for damages, costs of environmental
remediation, fines, penalties or indemnities), of the Borrower or any
Subsidiary directly or indirectly resulting from or based upon (a) violation
of any Environmental Law, (b) the generation, use, handling, transportation,
storage, treatment or disposal of any Hazardous Materials, (c) exposure to
any Hazardous Materials, (d) the release or threatened release of any
Hazardous Materials into the environment or (e) any contract, agreement or
other consensual arrangement pursuant to which liability is assumed or
imposed with respect to any of the foregoing.
"ERISA" means the Employee Retirement Income Security Act of 1974,
as amended from time to time.
"ERISA Affiliate" means 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" means (a) any "reportable event", as defined in
Section 4043 of ERISA or the regulations issued thereunder with respect to a
Plan (other than an event for which the 30-day notice period is waived);
(b) 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; (c) 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; (d) the incurrence by the Borrower
or any of its ERISA Affiliates of any liability under Title IV of ERISA with
respect to the termination of any Plan; (e) the receipt by the Borrower or
any ERISA Affiliate from the PBGC of any notice of its intent to institute
proceedings to terminate any Plan or to appoint a trustee to administer any
Plan or the receipt by the Borrower or any ERISA Affiliate from a plan
administrator of any notice relating to the administrator's intent to
terminate any Plan; (f) the incurrence by the Borrower or any of its ERISA
Affiliates of any liability with respect to the withdrawal or partial
withdrawal from any Plan or Multiemployer Plan; or (g) the receipt by the
Borrower or any ERISA Affiliate of any notice, or the receipt by any
Multiemployer Plan from the Borrower or any ERISA Affiliate of any notice,
concerning the imposition of Withdrawal Liability 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.
"Eurodollar", when used in reference to any Loan or Borrowing,
refers to whether such Loan, or the Loans comprising such Borrowing, are
bearing interest at a rate determined by reference to the Adjusted LIBO Rate.
"Event of Default" has the meaning assigned to such term in
Article VII.
"Excluded Subsidiary" means each Subsidiary that is not a
Consolidated Subsidiary.
"Excluded Taxes" means, with respect to the Administrative Agent,
any Lender, any Issuing Bank or any other recipient of any payment to be made
by or on account of any obligation of the Borrower hereunder, (a) income or
franchise taxes imposed on (or measured by) its net income by the
United States of America, or by the jurisdiction under the laws of which such
recipient is organized or in which its principal office is located or, in the
case of any Lender, in which its applicable lending office is located,
(b) any branch profits taxes imposed by the United States of America or any
similar tax imposed by any other jurisdiction in which the Borrower is
located and (c) in the case of a Foreign Lender (other than an assignee
pursuant to a request by the Borrower under Section 2.19(b)), any withholding
tax that is imposed on amounts payable to such Foreign Lender at the time
such Foreign Lender becomes a party to this Agreement (or designates a new
lending office) or is attributable to such Foreign Lender's failure to comply
with Section 2.17(e), except to the extent that such Foreign Lender (or its
assignor, if any) was entitled, at the time of designation of a new lending
office (or assignment), to receive additional amounts from the Borrower with
respect to such withholding tax pursuant to Section 2.17(a).
"Fair Value" means, with respect to any assets or property owned by
the Borrower or any of the Consolidated Subsidiaries, the fair market value
thereof as determined from time to time by the Board of Directors (or a duly
constituted committee thereof) of the Borrower or such Consolidated
Subsidiary in good faith.
"Federal Funds Effective Rate" means, for any day, the weighted
average (rounded upwards, if necessary, to the next 1/100 of 1%) 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 (rounded
upwards, if necessary, to the next 1/100 of 1%) of the quotations for such
day for such transactions received by the Administrative Agent from three
Federal funds brokers of recognized standing selected by it.
"Fee Letters" means (i) the letter dated December 18, 1997, between
the Borrower and the Administrative Agent, (ii) the letter dated December 18,
1997, between the Borrower and the Documentation Agent and (iii) the letter
dated December 18, 1997, between the Borrower and the Syndication Agent.
"Financial Officer" means the chief financial officer, principal
accounting officer, treasurer or controller of the Borrower.
"First Indenture" means the Indenture, dated as of April 1, 1941,
of the Tucson Gas, Electric Light and Power Company, a predecessor to the
Borrower, to The Chase National Bank of the City of New York, as trustee, a
predecessor to The Chase Manhattan Bank, as amended, supplemented or
otherwise modified from time to time.
"First Mortgage Bonds" means the Borrower's First Mortgage Bonds
issued under the First Indenture.
"Foreign Lender" means any Lender that is organized under the laws
of a jurisdiction other than that in which the Borrower is located. For
purposes of this definition, the United States of America, each State thereof
and the District of Columbia shall be deemed to constitute a single
jurisdiction.
"GAAP" means generally accepted accounting principles in the
United States of America.
"Governmental Authority" means the government of the United States
of America, any other nation or any political subdivision thereof, whether
state or local, and any agency, authority, instrumentality, regulatory body,
court, central bank or other entity exercising executive, legislative,
judicial, taxing, regulatory or administrative powers or functions of or
pertaining to government.
"Guarantee" of or by any Person (the "guarantor") means any
obligation, contingent or otherwise, of the guarantor guaranteeing or having
the economic effect of guaranteeing any Indebtedness or other obligation of
any other Person (the "primary obligor") in any manner, whether directly or
indirectly, and including any obligation of the guarantor, direct or
indirect, (a) to purchase or pay (or advance or supply funds for the purchase
or payment of) such Indebtedness or other obligation or to purchase (or to
advance or supply funds for the purchase of) any security for the payment
thereof, (b) to purchase or lease property, securities or services for the
purpose of assuring the owner of such Indebtedness or other obligation of the
payment thereof, (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 or other obligation or
(d) as an account party in respect of any letter of credit or letter of
guaranty issued to support such Indebtedness or obligation; provided, that
the term Guarantee shall not include endorsements for collection or deposit
in the ordinary course of business.
"Hazardous Materials" means all explosive or radioactive
substances or wastes and all hazardous or toxic substances, wastes or other
pollutants, including petroleum or petroleum distillates, asbestos or
asbestos containing materials, polychlorinated biphenyls, radon gas,
infectious or medical wastes and all other substances or wastes of any nature
regulated pursuant to any Environmental Law.
"Hedging Agreement" means any interest rate protection agreement,
foreign currency exchange agreement, commodity price protection agreement or
other interest or currency exchange rate or commodity price hedging arrange-
ment.
"Indebtedness" of any Person means, without duplication, (a) all
obligations of such Person for borrowed money or with respect to deposits or
advances of any kind, (b) all obligations of such Person evidenced by bonds,
debentures, notes or similar instruments, (c) all obligations of such Person
upon which interest charges are customarily paid, (d) all obligations of such
Person under conditional sale or other title retention agreements relating to
property acquired by such Person, (e) all obligations of such Person in
respect of the deferred purchase price of property or services (excluding
current accounts payable incurred in the ordinary course of business),
(f) 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
Indebtedness secured thereby has been assumed, (g) all Guarantees by such
Person of Indebtedness of others, (h) all Capital Lease Obligations of such
Person, (i) all obligations, contingent or otherwise, of such Person as an
account party in respect of letters of credit and letters of guaranty and
(j) all obligations, contingent or otherwise, of such Person in respect of
bankers' acceptances. The Indebtedness of any Person shall include the
Indebtedness of any other entity (including any partnership in which such
Person is a general partner) to the extent such Person is liable therefor as
a result of such Person's ownership interest in or other relationship with
such entity, except to the extent the terms of such Indebtedness provide that
such Person is not liable therefor.
"Indemnified Taxes" means Taxes other than Excluded Taxes.
"Indentures" means the First Indenture and the Second Indenture.
"Index Debt" means the First Mortgage Bonds until the first date on
which the aggregate outstanding principal amount of the First Mortgage Bonds
shall be less than $100,000,000 and the Second Mortgage Bonds shall be rated
by at least two of the Rating Agencies, at which time the Index Debt shall be
the Second Mortgage Bonds.
"Information Memorandum" means the Confidential Information
Memorandum dated November 1997 relating to the Borrower and the Transactions.
"Interest Election Request" means a request by the Borrower to
convert or continue a Revolving Borrowing in accordance with Section 2.08.
"Interest Payment Date" means (a) with respect to any ABR Loan, the
last day of each March, June, September and December and (b) with respect to
any Eurodollar 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 prior to the last day of such Interest Period that occurs at intervals of
three months' duration after the first day of such Interest Period.
"Interest Period" means, with respect to any Eurodollar Borrowing,
the period commencing on the date of such Borrowing and ending on the
numerically corresponding day in the calendar month that is one, three or
six months thereafter, as the Borrower may elect; provided, that (i) 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 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 and
(ii) any Interest Period that commences on the last Business Day of a
calendar month (or on a day for which there is no numerically corresponding
day in the last calendar month of such Interest Period) shall end on the last
Business Day of the last calendar month of such Interest Period. For
purposes hereof, the date of a Borrowing initially shall be the date on which
such Borrowing is made and thereafter shall be the effective date of the most
recent conversion or continuation of such Borrowing.
"Issuing Bank" means The Toronto-Dominion Bank and each other
Person executing this Agreement as an Issuing Bank, in its capacity as issuer
of Letters of Credit hereunder, and each of their successors in such capacity
as provided in Section 2.06(i).
"LC Commitment" means, with respect to each Lender, the commitment
of such Lender to acquire participations in Letters of Credit hereunder,
expressed as an amount representing the maximum aggregate amount of such
Lender's LC Exposure hereunder, as such commitment 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. The initial amount of each Lender's LC Commitment is set forth
on Schedule 2.01, or in the Assignment and Acceptance pursuant to which such
Lender shall have assumed its LC Commitment, as applicable. The initial
aggregate amount of the Lenders' LC Commitments is $443,874,718.39.
"LC Disbursement" means a payment made by an Issuing Bank pursuant
to a Letter of Credit.
"LC Exposure" means, at any time, the sum of (a) the aggregate
undrawn amount of all outstanding Letters of Credit at such time plus (b) the
aggregate amount of all LC Disbursements that have not yet been reimbursed by
or on behalf of the Borrower at such time. The LC Exposure of any Lender at
any time shall be its Applicable Percentage of the total LC Exposure at such
time.
"Lenders" means the Persons listed on Schedule 2.01 and any other
Person that shall have become a party hereto pursuant to an Assignment and
Acceptance, other than any such Person that ceases to be a party hereto
pursuant to an Assignment and Acceptance.
"Letter of Credit" means any letter of credit issued pursuant to
this Agreement.
"LIBO Rate" means, 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
Administrative 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
Administrative Agent in immediately available funds in the London interbank
market at approximately 12:00 noon, London time, two Business Days prior to
the commencement of such Interest Period.
"Lien" means, with respect to any asset, (a) any mortgage, deed of
trust, lien, pledge, hypothecation, encumbrance, charge or security interest
in, on or of such asset, (b) the interest of a vendor or a lessor under any
conditional sale agreement, capital lease or title retention agreement (or
any financing lease having substantially the same economic effect as any of
the foregoing) relating to such asset and (c) in the case of securities, any
purchase option, call or similar right of a third party with respect to such
securities.
"Lien of the Second Indenture" has the meaning assigned to the
phrases "Lien of this Indenture" and "lien hereof" in the Second Indenture.
"Loan Documents" means this Agreement, the Bond Delivery Agreement,
the Second Supplemental Indenture, the Collateral Mortgage Bonds, the Revenue
Bond Pledge Agreements and the other Security Documents.
"Loans" means the loans made by the Lenders to the Borrower
pursuant to this Agreement.
"Material Adverse Effect" means a material adverse effect on
(a) the financial condition, results of operations, business or prospects of
the Borrower and the Subsidiaries taken as a whole, (b) the ability of the
Borrower to perform any of its obligations under any Loan Document or the
Second Indenture or (c) the rights of or benefits available to the Lenders
under any Loan Document or the Second Indenture.
"Material Indebtedness" means Indebtedness (other than the Loans
and Letters of Credit), or obligations in respect of one or more Hedging
Agreements, of any one or more of the Borrower and the Significant
Subsidiaries in an aggregate principal amount exceeding $15,000,000. For
purposes of determining Material Indebtedness, the "principal amount" of the
obligations of the Borrower or any Subsidiary in respect of any Hedging
Agreement at any time shall be the maximum aggregate amount (giving effect to
any netting agreements) that the Borrower or such Subsidiary would be
required to pay if such Hedging Agreement were terminated at such time.
"Material Indebtedness" shall not include at any time any Indebtedness of any
Significant Subsidiary that is non-recourse to the Borrower and the
Subsidiaries.
"Maturity Date" means December 30, 2002.
"Moody's" means Xxxxx'x Investors Service, Inc.
"MRA" means the Master Restructuring Agreement dated as of June 30,
1992, among the Borrower, Escavada Company, Xxxxx Wash Development Company,
Valencia Energy Company, the banks party thereto and Barclays Bank PLC,
New York Branch, as Administrative Agent and Collateral Agent.
"Multiemployer Plan" means a multiemployer plan as defined in
Section 4001(a)(3) of ERISA.
"Obligations" means (a)(i) the principal of and premium, if any,
and interest (including interest accruing during the pendency of any
bankruptcy, insolvency, receivership or other similar proceeding, regardless
of whether allowed or allowable in such proceeding) on the Loans and
LC Disbursements, when and as due, whether at maturity, by acceleration, upon
one or more dates set for prepayment or otherwise, (ii) each other payment
required to be made by the Borrower under this Agreement in respect of any
Letter of Credit, when and as due, and (iii) all other monetary obligations,
including fees, costs, expenses and indemnities, whether primary, secondary,
direct, contingent, fixed or otherwise (including monetary obligations
incurred during the pendency of any bankruptcy, insolvency, receivership or
other similar proceeding, regardless of whether allowed or allowable in such
proceeding), of the Borrower under this Agreement and the other Loan
Documents and (b) the due and punctual performance of all other covenants,
agreements, obligations and liabilities of the Borrower under or pursuant to
this Agreement and the other Loan Documents.
"Other Taxes" means any and all present or future stamp or
documentary taxes or any other excise or property taxes, charges or similar
levies arising from any payment made under any Loan Document or from the
execution, delivery or enforcement of, or otherwise with respect to, any Loan
Document.
"PBGC" means the Pension Benefit Guaranty Corporation referred to
and defined in ERISA and any successor entity performing similar functions.
"Person" means any natural person, corporation, limited liability
company, trust, joint venture, association, company, partnership,
Governmental Authority or other entity.
"Plan" means 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 302 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.
"Prime Rate" means the rate of interest per annum adopted from time
to time by The Toronto-Dominion Bank at its principal office in New York City
as its prime commercial lending rate; each change in the Prime Rate shall be
effective from and including the date such change is publicly announced as
being effective.
"Rating Agencies" means Duff & Xxxxxx Inc., Xxxxx Investors
Service, Inc., Moody's and S&P.
"Reference Ratings" means, at any time (a) whichever of the ratings
of S&P and Moody's applicable to the Index Debt shall be higher at such time
and (b) the highest of the ratings of the Rating Agencies (other than the
Rating Agency whose rating shall be employed as a Reference Rating pursuant
to the preceding clause (a)) applicable to the Index Debt at such time.
"Register" has the meaning set forth in Section 9.04.
"Related Parties" means, with respect to any specified Person, such
Person's Affiliates and the respective directors, officers, employees, agents
and advisors of such Person and such Person's Affiliates.
"Required Lenders" means, at any time, Lenders having Credit
Exposures and unused Commitments representing at least 66-_% of the sum of
the total Credit Exposures and unused Commitments at such time.
"Restricted Payment" means any dividend or other distribution
(whether in cash, securities or other property) with respect to any shares of
any class of capital stock of the Borrower, or any payment (whether in cash,
securities or other property), including any sinking fund or similar deposit,
on account of the purchase, redemption, retirement, acquisition, cancelation
or termination of any such shares of capital stock of the Borrower or any
option, warrant or other right to acquire any such shares of capital stock of
the Borrower.
"Revenue Bond Indenture" means, with respect to any Letter of
Credit, the Revenue Bond Indenture, as amended and supplemented from time to
time, in respect of the Revenue Bonds referenced on Schedule 2.05 for such
Letter of Credit.
"Revenue Bond Loan Agreement" means, with respect to any Letter of
Credit, the Revenue Bond Loan Agreement in respect of the Revenue Bonds
referenced on Schedule 2.05 for such Letter of Credit.
"Revenue Bonds" means, with respect to any Letter of Credit, the
Revenue Bonds referenced on Schedule 2.05 for such Letter of Credit.
"Revenue Bond Trustee" means, with respect to any Letter of Credit,
the trustee and/or agent, as applicable, named in such Letter of Credit's
Revenue Bond Indenture, and any successor or assign thereof.
"Revolving Commitment" means, with respect to each Lender, the
commitment of such Lender to make Revolving Loans hereunder, expressed as an
amount representing the maximum aggregate amount of such Lender's Revolving
Credit Exposure hereunder, as such commitment 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. The
initial amount of each Lender's Revolving Commitment is set forth on
Schedule 2.01, or in the Assignment and Acceptance pursuant to which such
Lender shall have assumed its Revolving Commitment, as applicable. The
initial aggregate amount of the Lenders' Revolving Commitments is
$100,000,000.
"Revolving Credit Exposure" means, with respect to any Lender at
any time, the sum of the outstanding principal amount of such Lender's
Revolving Loans at such time.
"Revolving Loan" means a Loan made pursuant to Section 2.03.
"Sale Leaseback" shall mean any transaction or series of related
transactions pursuant to which the Borrower or any of its Consolidated
Subsidiaries sells, transfers or otherwise disposes of any property, real or
personal, whether now owned or hereafter acquired, and thereafter rents or
leases such property or other property that it intends to use for
substantially the same purpose or purposes as the property being sold,
transferred or disposed of.
"San Xxxxxx" means San Xxxxxx Resources Inc., an Arizona
corporation.
"S&P" means Standard & Poor's.
"Second Indenture" means the Indenture of Mortgage and Deed of
Trust dated as of December 1, 1992, of the Borrower to Bank of Montreal Trust
Company, as trustee, as amended, supplemented or otherwise modified from time
to time.
"Second Mortgage Bonds" means the Borrower's Second Mortgage Bonds
issued under the Second Indenture.
"Second Supplemental Indenture" means Supplemental Indenture No. 2
under the Second Indenture, substantially in the form of Exhibit D.
"Security Documents" means the Second Supplemental Indenture, the
Collateral Mortgage Bonds, the Bond Delivery Agreement, the Revenue Bond
Pledge Agreements, and each other security agreement or other instrument or
document executed and delivered pursuant to Section 5.10 or pursuant to any
of the foregoing documents to secure any of the Obligations.
"Significant Subsidiary" means (a) San Xxxxxx, (b) any Subsidiary
that directly or indirectly owns or Controls any other Significant Subsidiary
and (c) any other Subsidiary the Borrower's direct or indirect proportionate
share of consolidated total assets of which as of the end of the most recent
fiscal quarter for which financial statements have been delivered pursuant to
Section 5.01 were greater than or equal to 10% of the consolidated total
assets as of such date for the Borrower and the Consolidated Subsidiaries,
taken as a whole. For purposes of making the determinations required by this
definition, revenues and assets of foreign Subsidiaries shall be converted
into dollars at the rates used in preparing the consolidated balance sheet of
the Borrower included in the applicable financial statements.
"Statutory Reserve Rate" means 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 funding (currently referred to as
"Eurocurrency Liabilities" 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 funding 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 or any comparable regulation. The
Statutory Reserve Rate shall be adjusted automatically on and as of the
effective date of any change in any reserve percentage.
"subsidiary" means, with respect to any Person (the "parent") at
any date, any corporation, limited liability company, partnership,
association or other entity the accounts of which would be consolidated with
those of the parent in the parent's consolidated financial statements if such
financial statements were prepared in accordance with GAAP as of such date,
as well as any other corporation, limited liability company, partnership,
association or other entity (a) of which securities or other ownership
interests representing more than 50% of the equity or more than 50% of the
ordinary voting power or, in the case of a partnership, more than 50% of the
general partnership interests are, as of such date, owned, controlled or
held, or (b) that is, as of such date, otherwise Controlled, by the parent or
one or more subsidiaries of the parent or by the parent and one or more
subsidiaries of the parent.
"Subsidiary" means any subsidiary of the Borrower.
"Syndication Agent" means The Bank of New York, in its capacity as
syndication agent for the Lenders.
"Taxes" means any and all present or future taxes, levies, imposts,
duties, deductions, charges or withholdings imposed by any Governmental
Authority.
"Three-Month Secondary CD Rate" means, 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 is not 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 is not
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
11:00 a.m., New York City time, on such day (or, if such day is not a
Business Day, on the next preceding Business Day) by the Administrative Agent
from three negotiable certificate of deposit dealers of recognized standing
selected by it.
"Transactions" means the execution, delivery and performance by the
Borrower of this Agreement and the other Loan Documents, the borrowing of
Loans, the use of the proceeds thereof, the issuance of Letters of Credit
hereunder and the issuance of the Collateral Mortgage Bonds to the
Administrative Agent under the Second Supplemental Indenture and the Bond
Delivery Agreement.
"Type", when used in reference to any Loan or Borrowing, refers to
whether the rate of interest on such Loan, or on the Loans comprising such
Borrowing, is determined by reference to the Adjusted LIBO Rate or the
Alternate Base Rate.
"Utility Business" means the business of producing, developing,
generating, transmitting, distributing, selling or supplying electrical
energy for any purpose, or any business incidental thereto or necessary in
connection therewith, or any business reasonably desirable in connection
therewith which the ACC or other utility regulatory body shall have
authorized the Borrower to enter.
"Withdrawal Liability" means 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. Classification of Loans and Borrowings. For
purposes of this Agreement, Loans may be classified and referred to by Type
(e.g., a "Eurodollar Loan"). Borrowings also may be classified and referred
to by Type (e.g., a "Eurodollar Borrowing").
SECTION 1.03. Terms Generally. The definitions of terms herein
shall apply equally to 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". The word "will" shall be construed to have the same meaning and
effect as the word "shall". Unless the context requires otherwise (a) any
definition of or reference to any agreement, instrument or other document
herein shall be construed as referring to such agreement, instrument or other
document as from time to time amended, supplemented or otherwise modified
(subject to any restrictions on such amendments, supplements or modifications
set forth herein), (b) any reference herein to any Person shall be construed
to include such Person's successors and assigns, (c) the words "herein",
"hereof" and "hereunder", and words of similar import, shall be construed to
refer to this Agreement in its entirety and not to any particular provision
hereof, (d) all references herein to Articles, Sections, Exhibits and
Schedules shall be construed to refer to Articles and Sections of, and
Exhibits and Schedules to, this Agreement and (e) the words "asset" and
"property" shall be construed to have the same meaning and effect and to
refer to any and all tangible and intangible assets and properties, including
cash, securities, accounts and contract rights.
SECTION 1.04. Accounting Terms; GAAP. Except as otherwise
expressly provided herein, all terms of an accounting or financial nature
shall be construed in accordance with GAAP, as in effect from time to time;
provided that, if the Borrower notifies the Administrative Agent that the
Borrower requests an amendment to any provision hereof to eliminate the
effect of any change occurring after the date hereof in GAAP or in the
application thereof on the operation of such provision (or if the
Administrative Agent notifies the Borrower that the Required Lenders request
an amendment to any provision hereof for such purpose), regardless of whether
any such notice is given before or after such change in GAAP or in the appli-
cation thereof, then such provision shall be interpreted on the basis of GAAP
as in effect and applied immediately before such change shall have become
effective until such notice shall have been withdrawn or such provision
amended in accordance herewith.
ARTICLE II
The Credits
------------
SECTION 2.01. Revolving Commitments. Subject to the terms and
conditions set forth herein, each Lender agrees to make Revolving Loans to
the Borrower from time to time during the Availability Period in an aggregate
principal amount that will not result in (a) such Lender's Revolving Credit
Exposure exceeding such Lender's Revolving Commitment or (b) the sum of the
total Revolving Credit Exposures exceeding the total Revolving Commitments or
(c) the total Credit Exposures exceeding the total Commitments. Within the
foregoing limits and subject to the terms and conditions set forth herein,
the Borrower may borrow, prepay and reborrow Revolving Loans.
SECTION 2.02. Loans and Borrowings. (a) Each Revolving Loan
shall be made as part of a Borrowing consisting of Revolving Loans made by
the Lenders ratably in accordance with their respective Revolving
Commitments. The failure of any Lender to make any Loan required to be made
by it shall not relieve any other Lender of its obligations hereunder; pro-
vided that the Revolving Commitments of the Lenders are several and no Lender
shall be responsible for any other Lender's failure to make Loans as
required.
(b) Subject to Section 2.14, each Revolving Borrowing shall be
comprised entirely of ABR Loans or Eurodollar Loans as the Borrower may
request in accordance herewith. Each Lender at its option may 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 affect the obligation of the Borrower to repay such Loan in accord-
ance with the terms of this Agreement.
(c) At the commencement of each Interest Period for any Eurodollar
Revolving Borrowing, such Borrowing shall be in an aggregate amount that is
not less than $5,000,000. At the time that each ABR Revolving Borrowing is
made, such Borrowing shall be in an aggregate amount that is not less than
$5,000,000; provided that an ABR Revolving Borrowing may be in an aggregate
amount that is equal to the entire unused balance of the total Revolving
Commitments or that is required to finance the reimbursement of an
LC Disbursement as contemplated by Section 2.06(e). Borrowings of more than
one Type may be outstanding at the same time; provided that there shall not
at any time be more than a total of five Eurodollar Revolving Borrowings
outstanding.
(d) Notwithstanding any other provision of this Agreement, the
Borrower shall not be entitled to request, or to elect to convert or
continue, any Borrowing if the Interest Period requested with respect thereto
would end after the Maturity Date.
SECTION 2.03. Requests for Revolving Borrowings. To request a
Revolving Borrowing, the Borrower shall notify the Administrative Agent of
such request by telephone (a) in the case of a Eurodollar Borrowing, not
later than 12:00 noon, New York City time, three Business Days before the
date of the proposed Borrowing or (b) in the case of an ABR Borrowing, not
later than 12:00 noon, New York City time, one Business Day before the date
of the proposed Borrowing; provided that any such notice of an ABR Revolving
Borrowing to finance the reimbursement of an LC Disbursement as contemplated
by Section 2.06(e) may be given not later than 11:00 a.m., New York City
time, on the date of the proposed Borrowing. Each such telephonic Borrowing
Request shall be irrevocable and shall be confirmed promptly by hand delivery
or telecopy to the Administrative Agent of a written Borrowing Request in a
form approved by the Administrative Agent and signed by the Borrower. Each
such telephonic and written Borrowing Request shall specify the following
information in compliance with Section 2.02:
(i) the aggregate amount of the requested Borrowing;
(ii) the date of such Borrowing, which shall be a Business Day;
(iii) whether such Borrowing is to be an ABR Borrowing or a
Eurodollar Borrowing;
(iv) in the case of a Eurodollar Borrowing, the initial Interest
Period to be applicable thereto, which shall be a period contemplated by
the definition of the term "Interest Period"; and
(v) the location and number of the Borrower's account to which
funds are to be disbursed, which shall comply with the requirements of
Section 2.07.
If no election as to the Type of Revolving Borrowing is specified, then the
requested Revolving Borrowing shall be an ABR Borrowing. If no Interest
Period is specified with respect to any requested Eurodollar Revolving
Borrowing, then the Borrower shall be deemed to have selected an Interest
Period of one month's duration. Promptly following receipt of a Borrowing
Request in accordance with this Section, the Administrative Agent shall
advise each Lender of the details thereof and of the amount of such Lender's
Loan to be made as part of the requested Borrowing.
SECTION 2.04. Extension of Maturity Date. (a) The Borrower may
on each of the third and fourth anniversaries of the date hereof, by notice
to the Administrative Agent (which shall promptly deliver a copy to each of
the Lenders and the Issuing Banks) given not less than 60 days and not more
than 90 days prior to such anniversary, request that the Lenders and the
Issuing Banks extend the Maturity Date for an additional period of not more
than one year as specified in such notice. Any such notice shall specify any
fees that the Borrower agrees to pay as consideration for such extension, any
changes to the Applicable Rates that will apply during the term of such
extension, the amendments, if any, to Sections 6.06, 6.07 and 6.08 proposed
by the Borrower to be applicable during the term of such extension and any
other amendment proposed to be applicable to any Loan Document during the
term of such extension. Each Lender and Issuing Bank shall, by notice to the
Borrower and the Administrative Agent given not later than the 45th day after
the date of the Borrower's notice, advise the Borrower whether or not it
agrees to such extension on the terms set forth in such notice. Any Lender
or Issuing Bank that has not so advised the Administrative Agent by such day
shall be deemed to have declined to agree to such extension.
(b) If (and only if) all the Issuing Banks and all the Lenders
shall have agreed to extend the Maturity Date, then the Maturity Date shall
be extended for the additional period and on the terms specified in the
Borrower's notice provided for under subsection (a) and, if such terms vary
from those contained in this Agreement or any other Loan Document, the
Borrower, the Issuing Banks and the extending Lenders shall enter into an
amendment to this Agreement and each such Loan Document to be effective as of
the Maturity Date in effect prior to such extension pursuant to which such
terms shall be given effect. If such notice shall have specified any fees as
consideration for such extension, then such fees shall constitute additional
Obligations hereunder secured by the Security Documents.
(c) The decision to agree or withhold agreement to any extension
of the Maturity Date hereunder shall be at the sole discretion of each Lender
and Issuing Bank, subject to the rights of the Borrower under Section 2.06(i)
and 2.19(b).
SECTION 2.05. Issuance of Letters of Credit on the Effective Date.
Subject to the terms and conditions set forth herein, each Issuing Bank
agrees to issue on the Effective Date each Letter of Credit set forth next to
its name on Schedule 2.05 in the form thereof attached to Schedule 2.05. In
the event of any inconsistency between the terms and conditions of this
Agreement and the terms and conditions of any form of letter of credit
application or other agreement submitted by the Borrower to, or entered into
by the Borrower with, any Issuing Bank relating to any Letter of Credit, the
terms and conditions of this Agreement shall control.
SECTION 2.06. Letters of Credit--General Terms. (a) Limitation
of Amount. A Letter of Credit shall be issued, amended or extended only if
(and upon issuance, amendment 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 (i) the LC Exposure shall
not exceed the aggregate amount of the LC Commitments and (ii) the total
Credit Exposures shall not exceed the total Commitments.
(b) Requests for Amendments of Letters of Credit. To request the
amendment of an outstanding Letter of Credit, the Borrower shall hand deliver
or telecopy to the applicable Issuing Bank and the Administrative Agent
(reasonably in advance of the requested date of amendment) a notice identi-
fying the Letter of Credit to be amended and specifying the date of amendment
(which shall be a Business Day), the amount of such Letter of Credit, the
name and address of the beneficiary thereof and such other information as
shall be necessary to amend such Letter of Credit.
(c) Expiration Date. Each Letter of Credit shall expire at the
close of business on the Maturity Date. In the event the Maturity Date is
extended pursuant to Section 2.04, the Borrower shall hand deliver or
telecopy to each Issuing Bank and the Administrative Agent a notice
requesting that each Issuing Bank shall on a date on or after the effective
date of such extension specified in such notice either amend or replace each
Letter of Credit of such Issuing Bank to extend the expiration date thereof
to the new Maturity Date and each Issuing Bank shall on such date so amend or
replace each Letter of Credit issued by it hereunder. If requested by any
Issuing Bank, the Borrower also shall submit a letter of credit application
(which shall not impose any conditions on such amendment or replacement
beyond those contained in this Agreement) on such Issuing Bank's standard
form in connection with such amendment or replacement.
(d) Participations. By the issuance of a Letter of Credit (or an
amendment to a Letter of Credit increasing the amount thereof) and without
any further action on the part of the applicable Issuing Bank or the Lenders,
such Issuing Bank hereby grants to each Lender, and each Lender hereby
acquires from such Issuing Bank, a participation in such Letter of Credit
equal to such Lender's Applicable Percentage of the aggregate amount
available to be drawn under such Letter of Credit. In consideration and in
furtherance of the foregoing, each Lender hereby absolutely and
unconditionally agrees to pay to the Administrative Agent, for the account of
such Issuing Bank, such Lender's Applicable Percentage of each
LC Disbursement made by such Issuing Bank and not reimbursed by the Borrower
on the date due as provided in paragraph (e)(i) of this Section or, with
respect to any LC Disbursement referred to in paragraph (e)(ii) of this
Section, on the date reimbursement would have been due had such LC
Disbursement been governed by paragraph (e)(i), or of any reimbursement
payment required to be refunded to the Borrower for any reason. Each Lender
acknowledges and agrees that its obligation to acquire participations pur-
suant to this paragraph in respect of Letters of Credit is absolute and
unconditional and shall not be affected by any circumstance whatsoever,
including any amendment, renewal or extension of any Letter of Credit or the
occurrence and continuance of a Default or reduction or termination of the
LC Commitments, and that each such payment shall be made without any offset,
abatement, withholding or reduction whatsoever.
(e) Reimbursement. (i) If any Issuing Bank shall make any
LC Disbursement in respect of a Letter of Credit, the Borrower shall, except
as provided in paragraph (ii) below, reimburse such LC Disbursement by paying
to the Administrative Agent an amount equal to such LC Disbursement not later
than 1:00 p.m., New York City time, on the date that such LC Disbursement is
made, if the Borrower shall have received notice of such LC Disbursement
prior to 11:00 a.m., New York City time, on such date, or, if such notice has
not been received by the Borrower prior to such time on such date, then not
later than 1:00 p.m., New York City time, on (i) the Business Day that the
Borrower receives such notice, if such notice is received prior to
11:00 a.m., New York City time, on the day of receipt, or (ii) the Business
Day immediately following the day that the Borrower receives such notice, if
such notice is not received prior to such time on the day of receipt;
provided that the Borrower may, subject to the conditions to borrowing set
forth herein, request in accordance with Sections 2.01 and 2.03 that such
payment be financed with an ABR Revolving Borrowing in an equivalent amount
and, to the extent so financed, the Borrower's obligation to make such
payment shall be discharged and replaced by the resulting ABR Revolving
Borrowing. If the Borrower fails to make such payment when due, the
Administrative Agent shall notify each Lender of the applicable
LC Disbursement, the payment then due from the Borrower in respect thereof
and such Lender's Applicable Percentage thereof. Promptly following receipt
of such notice, each Lender shall pay to the Administrative Agent its
Applicable Percentage of the payment then due from the Borrower, in the same
manner as provided in Section 2.07 with respect to Loans made by such Lender
(and Section 2.07 shall apply, mutatis mutandis, to the payment obligations
of the Lenders), and the Administrative Agent shall promptly pay to the
applicable Issuing Bank the amounts so received by it from the Lenders.
Promptly following receipt by the Administrative Agent of any payment from
the Borrower pursuant to this paragraph, the Administrative Agent shall
distribute such payment to the applicable Issuing Bank or, to the extent that
Lenders have made payments pursuant to this paragraph to reimburse such
Issuing Bank, then to such Lenders and such Issuing Bank as their interests
may appear. Any payment made by a Lender pursuant to this paragraph to
reimburse an Issuing Bank for any LC Disbursement (other than the funding of
ABR Revolving Loans as contemplated above) shall not constitute a Loan and
shall not relieve the Borrower of its obligation to reimburse such
LC Disbursement.
(ii) In the case of any LC Disbursement to fund the payment of the
purchase price (to the extent such purchase price is attributable to the
principal of a Revenue Bond) of any Revenue Bond that the Borrower is unable
to remarket prior to the day on which payment of the purchase price of such
Revenue Bond is due to the holder or owner thereof (a "Purchase Price
Disbursement"), the Borrower shall reimburse such Purchase Price Disbursement
on or prior to the Maturity Date; provided that (A) such Revenue Bond shall
be promptly delivered and pledged to the applicable Issuing Bank under a
pledge agreement in substantially the form of Exhibit C and otherwise
satisfactory to such Issuing Bank and the Administrative Agent, (B) any
portion of such Purchase Price Disbursement may be repaid at any time by or
on behalf of the Borrower on one Business Day's notice stating the amount to
be repaid (which shall be $100,000 or a whole multiple thereof) and directing
such Issuing Bank to deliver Revenue Bonds held by or for the account of such
Issuing Bank to or upon the order of the Borrower against repayment of the
portion of such Purchase Price Disbursement attributable to such Revenue
Bonds with the proceeds of the remarketing of such Revenue Bonds and
specifying the principal amount of Revenue Bonds to be so delivered, and
(C) upon payment to the Administrative Agent for the account of such Issuing
Bank of the amount of any such repayment, together with accrued interest to
the date of such repayment on the amount of the Purchase Price Disbursement
to be repaid, the outstanding obligations of the Borrower in respect of such
Purchase Price Disbursement shall be reduced by the amount of such repayment,
interest shall cease to accrue on the amount so repaid and such Issuing Bank
shall release to or upon the order of the Borrower from the pledge and
security interest created by the applicable pledge agreement a principal
amount of Revenue Bonds held under such pledge agreement equal to the amount
of such repayment; provided that, prior to the release of such Revenue Bonds,
the Borrower shall have paid to such Issuing Bank the amount of any
LC Disbursement made in connection with the purchase of such Revenue Bonds to
pay the interest portion of the purchase price thereof. The provisions of
paragraph (i) above shall apply with respect to any portion of such an
LC Disbursement on the Maturity Date as if it were an LC Disbursement in
respect of which the Borrower received notice prior to 11:00 a.m., New York
City time, on the Maturity Date. Whenever an Issuing Bank is holding Revenue
Bonds pursuant to a pledge agreement in respect of a Letter of Credit and
accordingly receives a payment of interest on such pledged Revenue Bonds,
such Issuing Bank shall promptly deliver such interest so received to the
Administrative Agent for application to the payment of accrued and unpaid
interest on all outstanding Purchase Price Disbursements of such Issuing Bank
in respect of such Letter of Credit. If the amount of interest so received
exceeds the amount of accrued and unpaid interest on such Purchase Price
Disbursements on the date of receipt, such Issuing Bank shall hold the unused
balance of such interest received and apply it on a daily basis to interest
accrued on such Purchase Price Disbursements.
(f) Obligations Absolute. The Borrower's obligation to reimburse
LC Disbursements as provided in paragraph (e) of this Section 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 this Agreement, or any term or provision therein,
(ii) any draft or other document presented under a Letter of Credit proving
to be forged, fraudulent or invalid in any respect or any statement therein
being untrue or inaccurate in any respect, (iii) payment by an 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, or (iv) 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, or provide a right of setoff against, the
Borrower's obligations hereunder. None of the Administrative Agent, the
Lenders nor the Issuing Banks, nor any of their Related Parties, shall have
any liability or responsibility by reason of or in connection with the
issuance or transfer of any Letter of Credit or any payment or failure to
make any payment thereunder (irrespective of any of the circumstances
referred to in the preceding sentence), or any error, omission, interruption,
loss or delay in transmission or delivery of any draft, notice or other
communication under or relating to any Letter of Credit (including any
document required to make a drawing thereunder), any error in interpretation
of technical terms or any consequence arising from causes beyond the control
of the applicable Issuing Bank; provided that the foregoing shall not be
construed to excuse such 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 such Issuing
Bank's failure to exercise care when determining whether drafts and other
documents presented under a Letter of Credit comply with the terms thereof.
The parties hereto expressly agree that, in the absence of gross negligence
or wilful misconduct on the part of an Issuing Bank (as finally determined by
a court of competent jurisdiction), such Issuing Bank shall be deemed to have
exercised care in each such determination. In furtherance of the foregoing
and without limiting the generality thereof, the parties agree that, with
respect to documents presented which appear on their face to be in
substantial compliance with the terms of a Letter of Credit, the applicable
Issuing Bank may, in its sole discretion, either accept and make payment upon
such documents without responsibility for further investigation, regardless
of any notice or information to the contrary, or refuse to accept and make
payment upon such documents if such documents are not in strict compliance
with the terms of such Letter of Credit.
(g) Disbursement Procedures. Each Issuing Bank shall, promptly
following its receipt thereof, examine all documents purporting to represent
a demand for payment under a Letter of Credit. Such Issuing Bank shall
promptly notify the Administrative Agent and the Borrower by telephone (con-
firmed by telecopy) of such demand for payment and whether such Issuing Bank
has made or will make an LC Disbursement thereunder; provided that any
failure to give or delay in giving such notice shall not relieve the Borrower
of its obligation to reimburse such Issuing Bank and the Lenders with respect
to any such LC Disbursement.
(h) Interim Interest. If an Issuing Bank shall make any
LC Disbursement, then, unless the Borrower shall reimburse such
LC Disbursement in full on the date such LC Disbursement is made, the unpaid
amount thereof shall bear interest, for each day from and including the date
such LC Disbursement is made to but excluding the date that the Borrower
reimburses such LC Disbursement, at the rate per annum then applicable to ABR
Revolving Loans; provided that, if the Borrower fails to reimburse such
LC Disbursement when due pursuant to paragraph (e) of this Section, then
Section 2.13(c) shall apply. Interest accrued pursuant to this paragraph
shall be for the account of the applicable Issuing Bank, except that interest
accrued on and after the date of payment by any Lender pursuant to para-
graph (e) of this Section to reimburse an Issuing Bank shall be for the
account of such Lender to the extent of such payment.
(i) Replacement of an Issuing Bank. Any Issuing Bank may be
replaced at any time by written agreement among the Borrower and the
Administrative Agent; provided, however, that the Administrative Agent shall
review any such proposed agreement for form only and not with respect to the
identity of any successor Issuing Bank or the identity of the Issuing Bank to
be replaced (subject in the case of any replacement of any Affiliate of the
Administrative Agent to the provisions of the first paragraph of
Article VIII). The Administrative Agent shall notify the Lenders of any such
replacement of an Issuing Bank. At the time any such replacement shall
become effective, the Borrower shall pay all unpaid fees accrued for the
account of the replaced Issuing Bank pursuant to Section 2.12(b) and shall
return to such Issuing Bank each Letter of Credit issued by such Issuing
Bank. From and after the effective date of any such replacement, (i) the
successor Issuing Bank shall have all the rights and obligations of an
Issuing Bank under this Agreement with respect to Letters of Credit to be
issued by it on such effective date or thereafter and (ii) references herein
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 replacement of an Issuing
Bank hereunder, the replaced Issuing Bank shall remain a party hereto and
shall continue to have all the rights and obligations of an Issuing Bank
under this Agreement with respect to Letters of Credit issued by it prior to
such replacement, but shall not be required to issue additional Letters of
Credit.
(j) Acceleration of Revenue Bonds. If any Event of Default shall
occur and be continuing, the Administrative Agent may, and at the request of
the Required Lenders shall, direct the applicable Issuing Bank to take such
steps as are required and available to it under any Revenue Bond Indenture to
cause the Revenue Bond Trustee thereunder to declare the principal amount of
all Revenue Bonds then outstanding thereunder to be immediately due and
payable and, to the extent necessary to make all payments then due and
payable on the Revenue Bonds, require all necessary drawings under the
applicable Letter of Credit to be made in respect thereof, whereupon such
Issuing Bank shall pay from its general funds the amounts so drawn and such
amounts, all interest thereon and all other amounts payable by the Borrower
hereunder in respect thereof shall automatically be forthwith due and
payable.
SECTION 2.07. Funding of Borrowings. (a) Each Lender shall make
each Loan to be made by it hereunder on the proposed date thereof by wire
transfer of immediately available funds by 1:00 p.m., New York City time, to
the account of the Administrative Agent most recently designated by it for
such purpose by notice to the Lenders. The Administrative Agent will make
such Loans available to the Borrower by promptly crediting the amounts so
received, in like funds, to an account of the Borrower maintained with The
Toronto-Dominion Bank, New York Branch, in New York and designated by the
Borrower in the applicable Borrowing Request; provided that ABR Revolving
Loans made to finance the reimbursement of an LC Disbursement as provided in
Section 2.06(e) shall be remitted by the Administrative Agent to the
applicable Issuing Bank.
(b) Unless the Administrative Agent shall have received notice
from a Lender prior to the proposed date of any Borrowing that such Lender
will not make available to the Administrative Agent such Lender's share of
such Borrowing, the Administrative Agent may assume that such Lender has made
such share available on such date in accordance with paragraph (a) of this
Section and may, in reliance upon such assumption, make available to the
Borrower a corresponding amount. In such event, if a Lender has not in fact
made its share of the applicable Borrowing available to the Administrative
Agent, then the applicable Lender and the Borrower severally agree to pay to
the Administrative Agent forthwith on demand such corresponding amount with
interest thereon, for each day from and including the date such amount is
made available to the Borrower to but excluding the date of payment to the
Administrative Agent, at (i) in the case of such Lender, the greater of the
Federal Funds Effective Rate and a rate determined by the Administrative
Agent in accordance with banking industry rules on interbank compensation or
(ii) in the case of the Borrower, the interest rate applicable to ABR Loans.
If such Lender pays such amount to the Administrative Agent, then such amount
shall constitute such Lender's Loan included in such Borrowing.
SECTION 2.08. Interest Elections. (a) Each Borrowing initially
shall be of the Type specified in the applicable Borrowing Request and, in
the case of a Eurodollar Revolving Borrowing, shall have an initial Interest
Period as specified in such Borrowing Request. Thereafter, the Borrower may
elect to convert such Borrowing to a different Type or to continue such
Borrowing and, in the case of a Eurodollar Revolving Borrowing, may elect
Interest Periods therefor, all as provided in this Section. The Borrower may
elect different options with respect to different portions of the affected
Borrowing, in which case each such portion shall be allocated ratably among
the Lenders holding the Loans comprising such Borrowing, and the Loans
comprising each such portion shall be considered a separate Borrowing.
(b) To make an election pursuant to this Section, the Borrower
shall notify the Administrative Agent of such election by telephone by the
time that a Borrowing Request would be required under Section 2.03 if the
Borrower were requesting a Borrowing of the Type resulting from such election
to be made on the effective date of such election. Each such telephonic
Interest Election Request shall be irrevocable and shall be confirmed
promptly by hand delivery or telecopy to the Administrative Agent of a
written Interest Election Request in a form approved by the Administrative
Agent and signed by the Borrower.
(c) Each telephonic and written Interest Election Request shall
specify the following information in compliance with Section 2.02:
(i) the Borrowing to which such Interest Election Request applies
and, if different options are being elected with respect to different
portions thereof, the portions thereof to be allocated to each resulting
Borrowing (in which case the information to be specified pursuant to
clauses (iii) and (iv) below shall be specified for each resulting
Borrowing);
(ii) the effective date of the election made pursuant to such
Interest Election Request, which shall be a Business Day;
(iii) whether the resulting Borrowing is to be an ABR Borrowing or a
Eurodollar Borrowing; and
(iv) if the resulting Borrowing is a Eurodollar Borrowing, the
Interest Period to be applicable thereto after giving effect to such
election, which shall be a period contemplated by the definition of the
term "Interest Period".
If any such Interest Election Request requests a Eurodollar Borrowing but
does not specify an Interest Period, then the Borrower shall be deemed to
have selected an Interest Period of one month's duration.
(d) Promptly following receipt of an Interest Election Request,
the Administrative Agent shall advise each Lender of the details thereof and
of such Lender's portion of each resulting Borrowing.
(e) If the Borrower fails to deliver a timely Interest Election
Request with respect to a Eurodollar Revolving Borrowing prior to the end of
the Interest Period applicable thereto, then, unless such Borrowing is repaid
as provided herein, at the end of such Interest Period such Borrowing shall
be converted to an ABR Borrowing. Notwithstanding any contrary provision
hereof, if an Event of Default has occurred and is continuing and the
Administrative Agent, at the request of the Required Lenders, so notifies the
Borrower, then, so long as an Event of Default is continuing (i) no
outstanding Revolving Borrowing may be converted to or continued as a
Eurodollar Borrowing and (ii) unless repaid, each Eurodollar Revolving
Borrowing shall be converted to an ABR Borrowing at the end of the Interest
Period applicable thereto.
SECTION 2.09. Termination and Reduction of Commitments.
(a) Unless previously terminated, the Commitments shall terminate on the
Maturity Date.
(b) The Borrower may at any time terminate, or from time to time
reduce, the Revolving Commitments or the LC Commitments; provided that
(i) each reduction of the Revolving Commitments or the LC Commitments shall
be in an amount that is an integral multiple of $1,000,000 and not less than
$5,000,000 and (ii) the Borrower shall not terminate or reduce any
Commitments if, after giving effect to any concurrent prepayment of the Loans
in accordance with Section 2.11, the total Revolving Credit Exposures would
exceed the total Revolving Commitments, the LC Exposure would exceed the
total LC Commitments or the total Credit Exposures would exceed the total
Commitments.
(c) In the event that any Revenue Bonds shall be redeemed, repaid
or otherwise retired, the Borrower shall to the extent permitted under the
documentation for such Revenue Bonds permanently reduce the stated amount of
the applicable Letter of Credit and the LC Commitments hereunder shall be
automatically and permanently reduced by an amount equal to the amount of
such reduction as of the date such reduction becomes effective.
(d) The Borrower shall notify the Administrative Agent of any
election or requirement to terminate or reduce the Commitments under
paragraph (b) or (c) of this Section at least three Business Days prior to
the effective date of such termination or reduction (or as soon as
practicable but in any event no later than such effective date, in the case
of a reduction under paragraph (c)), specifying such election and the
effective date thereof. Promptly following receipt of any notice, the
Administrative Agent shall advise the Lenders of the contents thereof. Each
notice delivered by the Borrower pursuant to this Section shall be irrevoc-
able; provided that a notice of termination of the Commitments delivered by
the Borrower may state that such notice is conditioned upon the effectiveness
of other credit facilities, in which case such notice may be revoked by the
Borrower (by notice to the Administrative Agent on or prior to the specified
effective date) if such condition is not satisfied. Any termination or
reduction of the Commitments shall be permanent. Each reduction of the
Commitments shall be made ratably among the Lenders in accordance with their
respective Commitments.
SECTION 2.10. Repayment of Loans; Evidence of Debt. (a) The
Borrower hereby unconditionally promises to pay to the Administrative Agent
for the account of each Lender the then unpaid principal amount of each
Revolving 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, including the
amounts of principal and interest payable and paid to such Lender from time
to time hereunder.
(c) The Administrative Agent shall maintain accounts in which it
shall 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
Administrative Agent hereunder for the account of the Lenders and each
Lender's share thereof.
(d) The entries made in the accounts maintained pursuant to
paragraph (b) or (c) of this Section shall be prima facie evidence of the
existence and amounts of the obligations recorded therein; provided that the
failure of any Lender or the Administrative Agent to maintain such accounts
or any error therein shall not in any manner affect the obligation of the
Borrower to repay the Loans in accordance with the terms of this Agreement.
(e) Any Lender may request that Loans made by it be evidenced by a
promissory note. In such event, the Borrower shall prepare, execute and
deliver to such Lender a promissory note payable to the order of such Lender
(or, if requested by such Lender, to such Lender and its registered assigns)
and in a form approved by the Administrative Agent. Thereafter, the Loans
evidenced by such promissory note and interest thereon shall at all times
(including after assignment pursuant to Section 9.04) be represented by one
or more promissory notes in such form payable to the order of the payee named
therein (or, if such promissory note is a registered note, to such payee and
its registered assigns).
SECTION 2.11. Prepayment of Loans. (a) The Borrower shall have
the right at any time and from time to time to prepay any Borrowing in whole
or in part, subject to prior notice in accordance with paragraph (b) of this
Section.
(b) The Borrower shall notify the Administrative Agent by
telephone (confirmed by telecopy) of any prepayment hereunder (i) in the case
of prepayment of a Eurodollar Revolving Borrowing, not later than 12:00 noon,
New York City time, three Business Days before the date of prepayment or
(ii) in the case of prepayment of an ABR Revolving Borrowing, not later than
12:00 noon, New York City time, one Business Day before the date of
prepayment. Each such notice shall be irrevocable and shall specify the
prepayment date and the principal amount of each Borrowing or portion thereof
to be prepaid; provided that, if a notice of prepayment is given in
connection with a conditional notice of termination of the Commitments as
contemplated by Section 2.09, then such notice of prepayment may be revoked
if such notice of termination is revoked in accordance with Section 2.09.
Promptly following receipt of any such notice relating to a Revolving
Borrowing, the Administrative Agent shall advise the Lenders of the contents
thereof. Each partial prepayment of any Revolving Borrowing shall be in an
amount that would be permitted in the case of an advance of a Revolving
Borrowing of the same Type as provided in Section 2.02. Each prepayment of a
Revolving Borrowing shall be applied ratably to the Loans included in the
prepaid Borrowing. Prepayments shall be accompanied by accrued interest to
the extent required by Section 2.13.
SECTION 2.12. Fees. (a) The Borrower agrees to pay to the
Administrative Agent for the account of each Lender a commitment fee, which
shall accrue at the Applicable Rate on the daily unused amount of the
Commitments of such Lender during the period from and including the date
hereof to but excluding the date on which the last such Commitment terminates
(it being understood that outstanding Letters of Credit and LC Disbursements
constitute usage of the LC Commitments). Accrued commitment fees shall be
payable in arrears on the last day of March, June, September and December of
each year and on the date on which the Commitments terminate, commencing on
the first such date to occur after the date hereof. All commitment fees
shall be computed on the basis of a year of 360 days and shall be payable for
the actual number of days elapsed (including the first day but excluding the
last day).
(b) The Borrower agrees to pay (i) to the Administrative Agent for
the account of each Lender a participation fee with respect to its
participations in Letters of Credit, which shall accrue at the same
Applicable Rate as interest on Eurodollar Revolving Loans, on the average
daily amount of such Lender's LC Exposure (excluding any portion thereof
attributable to unreimbursed LC Disbursements) during the period from and
including the Effective Date to but excluding the later of the date on which
such Lender's Commitment terminates and the date on which such Lender ceases
to have any LC Exposure, and (ii) to each Issuing Bank a fronting fee, which
shall accrue at the rate of 0.125% per annum on the average daily amount of
the aggregate face amount of the outstanding Letters of Credit of such
Issuing Bank during the period from and including the Effective Date to but
excluding the later of the date of termination of the Commitments and the
date on which there ceases to be any LC Exposure, as well as such Issuing
Bank's standard fees with respect to the issuance, amendment, renewal or
extension of any Letter of Credit or processing of drawings thereunder.
Accrued participation fees and fronting fees shall be due and payable on the
last day of March, June, September and December of each year, commencing on
the first such date to occur after the Effective Date; provided that all such
fees shall be payable on the date on which the LC Commitments terminate and
any such fees accruing after the date on which the LC Commitments terminate
shall be payable on demand. Any other fees payable to any Issuing Bank
pursuant to this paragraph shall be payable within 10 days after demand. All
participation fees and fronting fees shall be computed on the basis of a year
of 360 days and shall be payable for the actual number of days elapsed
(including the first day but excluding the last day).
(c) The Borrower agrees to pay to the Administrative Agent, the
Documentation Agent and the Syndication Agent, each for its own account, fees
payable in the amounts and at the times separately agreed in the Fee Letters.
(d) All fees payable hereunder shall be paid on the dates due, in
immediately available funds, to the Administrative Agent (or to the
applicable Issuing Bank, in the case of fees payable to any Issuing Bank) for
distribution, in the case of commitment fees and participation fees, to the
Lenders. Fees paid shall not be refundable under any circumstances.
SECTION 2.13. Interest. (a) The Loans comprising each
ABR Borrowing shall bear interest at the Alternate Base Rate plus the
Applicable Rate.
(b) The Loans comprising each Eurodollar Borrowing shall bear
interest at the Adjusted LIBO Rate for the Interest Period in effect for such
Borrowing plus the Applicable Rate.
(c) Notwithstanding the foregoing, if any principal of or interest
on any Loan or any fee or other amount payable by the Borrower hereunder is
not paid when due, whether at stated maturity, upon acceleration or
otherwise, such overdue amount shall bear interest, after as well as before
judgment, at a rate per annum equal to (i) in the case of overdue principal
of any Loan, 2% plus the rate otherwise applicable to such Loan as provided
in the preceding paragraphs of this Section or (ii) in the case of any other
amount, 2% plus the rate applicable to ABR Loans as provided in paragraph (a)
of this Section.
(d) Accrued interest on each Loan shall be payable in arrears on
each Interest Payment Date for such Loan and upon termination of the
Revolving Commitments; provided that (i) interest accrued pursuant to para-
graph (c) of this Section shall be payable on demand, (ii) in the event of
any repayment or prepayment of any Loan, accrued interest on the principal
amount repaid or prepaid shall be payable on the date of such repayment or
prepayment and (iii) in the event of any conversion of any Eurodollar
Revolving Loan prior to the end of the current Interest Period therefor,
accrued interest on such Loan shall be payable on the effective date of such
conversion.
(e) All interest hereunder shall be computed on the basis of a
year of 360 days, except that interest computed by reference to the Alternate
Base Rate at times when the Alternate Base Rate is based on the Prime Rate
shall be computed on the basis of a year of 365 days (or 366 days in a leap
year), and in each case shall be payable for the actual number of days
elapsed (including the first day but excluding the last day). The applicable
Alternate Base Rate, Adjusted LIBO Rate or LIBO Rate shall be determined by
the Administrative Agent, and such determination shall be conclusive absent
manifest error.
SECTION 2.14. Alternate Rate of Interest. If prior to the
commencement of any Interest Period for a Eurodollar Borrowing:
(a) the Administrative Agent determines (which determination shall
be conclusive absent manifest error) that adequate and reasonable means
do not exist for ascertaining the Adjusted LIBO Rate or the LIBO Rate,
as applicable, for such Interest Period; or
(b) the Administrative Agent is advised by the Required Lenders
that the Adjusted LIBO Rate or the LIBO Rate, as applicable, for such
Interest Period will not adequately and fairly reflect the cost to such
Lenders (or Lender) of making or maintaining their Loans (or its Loan)
included in such Borrowing for such Interest Period;
then the Administrative Agent shall give notice thereof to the Borrower and
the Lenders by telephone or telecopy as promptly as practicable thereafter
and, until the Administrative Agent notifies the Borrower and the Lenders
that the circumstances giving rise to such notice no longer exist, (i) any
Interest Election Request that requests the conversion of any Revolving
Borrowing to, or continuation of any Revolving Borrowing as, a Eurodollar
Borrowing shall be ineffective and (ii) if any Borrowing Request requests a
Eurodollar Revolving Borrowing, such Borrowing shall be made as an ABR
Borrowing.
SECTION 2.15. Increased Costs. (a) If any Change in Law shall:
(i) 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 (except any such reserve
requirement reflected in the Adjusted LIBO Rate) or any Issuing Bank; or
(ii) impose on any Lender or any 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 of making or maintaining any Eurodollar Loan (or of maintaining its
obligation to make any such Loan) or to increase the cost to such Lender or
such Issuing Bank of participating in, issuing or maintaining any Letter of
Credit or to reduce the amount of any sum received or receivable by such
Lender or such Issuing Bank hereunder (whether of principal, interest or
otherwise), then the Borrower will pay to such Lender or such Issuing Bank,
as the case may be, such additional amount or amounts as will compensate such
Lender or such Issuing Bank, as the case may be, for such additional costs
incurred or reduction suffered.
(b) If any Lender or any Issuing Bank determines that any Change
in Law regarding capital requirements has or would have the effect of
reducing the rate of return on such Lender's or such Issuing Bank's capital
or on the capital of such Lender's or such Issuing Bank's holding company, if
any, as a consequence of this Agreement or the Loans made by, or
participations in Letters of Credit held by, such Lender, or the Letters of
Credit issued by such Issuing Bank, to a level below that which such Lender
or such Issuing Bank or such Lender's or such Issuing Bank's holding company
could have achieved but for such Change in Law (taking into consideration
such Lender's or such Issuing Bank's policies and the policies of such
Lender's or such Issuing Bank's holding company with respect to capital
adequacy), then from time to time the Borrower will pay to such Lender or
such Issuing Bank, as the case may be, such additional amount or amounts as
will compensate such Lender or such Issuing Bank or such Lender's or such
Issuing Bank's holding company for any such reduction suffered.
(c) A certificate of a Lender or an Issuing Bank setting forth the
amount or amounts necessary to compensate such Lender or such Issuing Bank or
its holding company, as the case may be, as specified in paragraph (a) or (b)
of this Section shall be delivered to the Borrower and shall be conclusive
absent manifest error. The Borrower shall pay such Lender or such Issuing
Bank, as the case may be, the amount shown as due on any such certificate
within 10 days after receipt thereof.
(d) Failure or delay on the part of any Lender or any Issuing Bank
to demand compensation pursuant to this Section shall not constitute a waiver
of such Lender's or such Issuing Bank's right to demand such compensation;
provided that the Borrower shall not be required to compensate a Lender or an
Issuing Bank pursuant to this Section for any increased costs or reductions
incurred more than 270 days prior to the date that such Lender or such
Issuing Bank, as the case may be, notifies the Borrower of the Change in Law
giving rise to such increased costs or reductions and of such Lender's or
such Issuing Bank's intention to claim compensation therefor; provided
further that, if the Change in Law giving rise to such increased costs or
reductions is retroactive, then the 270-day period referred to above shall be
extended to include the period of retroactive effect thereof.
SECTION 2.16. Break Funding Payments. In the event of (a) the
payment of any principal of any Eurodollar Loan other than on the last day of
an Interest Period applicable thereto (including as a result of an Event of
Default), (b) the conversion of any Eurodollar Loan other than on the last
day of the Interest Period applicable thereto, (c) the failure to borrow,
convert, continue or prepay any Revolving Loan on the date specified in any
notice delivered pursuant hereto (regardless of whether such notice may be
revoked under Section 2.11(b) and is revoked in accordance therewith),
(d) the assignment of any Eurodollar Loan other than on the last day of the
Interest Period applicable thereto as a result of a request by the Borrower
pursuant to Section 2.19, then, in any such event, the Borrower shall
compensate each Lender for the loss, cost and expense attributable to such
event. In the case of a Eurodollar Loan, such loss, cost or expense to any
Lender shall be deemed to include an amount determined by such Lender to be
the excess, if any, of (i) the amount of interest which would have accrued on
the principal amount of such Loan had such event not occurred, at the
Adjusted LIBO Rate that would have been applicable to such Loan, for the
period from the date of such event to the last day of the then current
Interest Period therefor (or, in the case of a failure to borrow, convert or
continue, for the period that would have been the Interest Period for such
Loan), over (ii) the amount of interest which would accrue on such principal
amount for such period at the interest rate which such Lender would bid were
it to bid, at the commencement of such period, for dollar deposits of a
comparable amount and period from other banks in the Eurodollar market. A
certificate of any Lender setting forth any amount or amounts that such
Lender is entitled to receive pursuant to this Section shall be delivered to
the Borrower and shall be conclusive absent manifest error. The Borrower
shall pay such Lender the amount shown as due on any such certificate within
10 days after receipt thereof.
SECTION 2.17. Taxes. (a) Any and all payments by or on account
of any obligation of the Borrower hereunder or under any other Loan Document
shall be made free and clear of and without deduction for any Indemnified
Taxes or Other Taxes; provided that if the Borrower shall be required to
deduct any Indemnified Taxes or Other Taxes from such payments, then (i) the
sum payable shall be increased as necessary so that after making all required
deductions (including deductions applicable to additional sums payable under
this Section) the Administrative Agent, Lender or Issuing Bank (as the case
may be) receives an amount equal to the sum it would have received had no
such deductions been made, (ii) the Borrower shall make such deductions and
(iii) the Borrower shall pay the full amount deducted to the relevant
Governmental Authority in accordance with applicable law.
(b) In addition, the Borrower shall pay any Other Taxes to the
relevant Governmental Authority in accordance with applicable law.
(c) The Borrower shall indemnify the Administrative Agent, each
Lender and each Issuing Bank, within 10 days after written demand therefor,
for the full amount of any Indemnified Taxes or Other Taxes paid by the
Administrative Agent, such Lender or such Issuing Bank, as the case may be,
on or with respect to any payment by or on account of any obligation of the
Borrower hereunder or under any other Loan Document (including Indemnified
Taxes or Other Taxes imposed or asserted on or attributable to amounts
payable under this Section) and any penalties, interest and reasonable
expenses arising therefrom or with respect thereto, whether or not such
Indemnified Taxes or Other Taxes were correctly or legally imposed or
asserted by the relevant Governmental Authority. A certificate as to the
amount of such payment or liability delivered to the Borrower by a Lender or
an Issuing Bank, or by the Administrative Agent on its own behalf or on
behalf of a Lender or an Issuing Bank, shall be conclusive absent manifest
error.
(d) As soon as practicable after any payment of Indemnified Taxes
or Other Taxes by the Borrower to a Governmental Authority, the Borrower
shall deliver to the Administrative Agent the original or a certified copy of
a receipt issued by such Governmental Authority evidencing such payment, a
copy of the return reporting such payment or other evidence of such payment
reasonably satisfactory to the Administrative Agent.
(e) Any Foreign Lender that is entitled to an exemption from or
reduction of withholding tax under the law of the jurisdiction in which the
Borrower is located, or any treaty to which such jurisdiction is a party,
with respect to payments under this Agreement shall deliver to the Borrower
(with a copy to the Administrative Agent), at the time or times prescribed by
applicable law, such properly completed and executed documentation prescribed
by applicable law or reasonably requested by the Borrower as will permit such
payments to be made without withholding or at a reduced rate.
SECTION 2.18. Payments Generally; Pro Rata Treatment; Sharing of
Set-offs. (a) The Borrower shall make each payment required to be made by
it hereunder or under any other Loan Document (whether of principal,
interest, fees or reimbursement of LC Disbursements, or of amounts payable
under Section 2.15, 2.16 or 2.17, or otherwise) prior to 1:00 p.m., New York
City time, on the date when due, in immediately available funds, without set-
off, counterclaim, recoupment or deduction of any kind. Any amounts received
after such time on any date may, in the discretion of the Administrative
Agent, be deemed to have been received on the next succeeding Business Day
for purposes of calculating interest thereon. All such payments shall be
made to the Administrative Agent at its offices at 000 Xxxxxx, Xxxxx 0000,
Xxxxxxx, Xxxxx, except payments to be made directly to an Issuing Bank as
expressly provided herein and except that payments pursuant to Sections 2.15,
2.16, 2.17 and 9.03 shall be made directly to the Persons entitled thereto
and payments pursuant to other Loan Documents shall be made to the Persons
specified therein. The Administrative Agent shall distribute any such
payments received by it for the account of any other Person to the
appropriate recipient promptly following receipt thereof. If any payment
hereunder or under any other Loan Document shall be due on a day that is not
a Business Day, the date for payment shall be extended to the next succeeding
Business Day, and, in the case of any payment accruing interest, interest
thereon shall be payable for the period of such extension. All payments
under each Loan Document shall be made in dollars.
(b) If at any time insufficient funds are received by and
available to the Administrative Agent to pay fully all amounts of principal,
unreimbursed LC Disbursements, interest and fees then due hereunder, such
funds shall be applied (i) first, towards payment of interest and fees then
due hereunder, ratably among the parties entitled thereto in accordance with
the amounts of interest and fees then due to such parties, and (ii) second,
towards payment of principal and unreimbursed LC Disbursements then due here-
under, ratably among the parties entitled thereto in accordance with the
amounts of principal and unreimbursed LC Disbursements then due to such
parties.
(c) If any Lender shall, by exercising any right of set-off or
counterclaim or otherwise, obtain payment in respect of any principal of or
interest on any of its Revolving Loans or participations in LC Disbursements
resulting in such Lender receiving payment of a greater proportion of the
aggregate amount of its Revolving Loans and participations in
LC Disbursements and accrued interest thereon than the proportion received by
any other Lender, then the Lender receiving such greater proportion shall
purchase (for cash at face value) participations in the Revolving Loans and
participations in LC Disbursements of other Lenders to the extent necessary
so that the benefit of all such payments shall be shared by the Lenders
ratably in accordance with the aggregate amount of principal of and accrued
interest on their respective Revolving Loans and participations in
LC Disbursements; provided that (i) if any such participations are purchased
and all or any portion of the payment giving rise thereto is recovered, such
participations shall be rescinded and the purchase price restored to the
extent of such recovery, without interest, and (ii) the provisions of this
paragraph shall not be construed to apply to any payment made by the Borrower
pursuant to and in accordance with the express terms of this Agreement or any
payment obtained by a Lender as consideration for the assignment of or sale
of a participation in any of its Loans or participations in LC Disbursements
to any assignee or participant, other than to the Borrower or any Subsidiary
or Affiliate thereof (as to which the provisions of this paragraph shall
apply). The Borrower consents to the foregoing and agrees, to the extent it
may effectively do so under applicable law, that any Lender acquiring a
participation pursuant to the foregoing arrangements may exercise against the
Borrower rights of set-off and counterclaim with respect to such
participation as fully as if such Lender were a direct creditor of the
Borrower in the amount of such participation.
(d) Unless the Administrative Agent shall have received notice
from the Borrower prior to the date on which any payment is due to the
Administrative Agent for the account of the Lenders or any Issuing Bank
hereunder that the Borrower will not make such payment, the Administrative
Agent may assume that the Borrower has made such payment on such date in
accordance herewith and may, in reliance upon such assumption, distribute to
the Lenders or such Issuing Bank, as the case may be, the amount due. In
such event, if the Borrower has not in fact made such payment, then each of
the Lenders or such Issuing Bank, as the case may be, severally agrees to
repay to the Administrative Agent forthwith on demand the amount so
distributed to such Lender or such Issuing Bank with interest thereon, for
each day from and including the date such amount is distributed to it to but
excluding the date of payment to the Administrative Agent, at the greater of
the Federal Funds Effective Rate and a rate determined by the Administrative
Agent in accordance with banking industry rules on interbank compensation.
(e) If any Lender shall fail to make any payment required to be
made by it pursuant to Section 2.06(d) or (e), 2.07(b) or 2.18(d), then the
Administrative Agent may, in its discretion (notwithstanding any contrary
provision hereof), apply any amounts thereafter received by the
Administrative Agent for the account of such Lender to satisfy such Lender's
obligations under such Sections until all such unsatisfied obligations are
fully paid.
SECTION 2.19. Mitigation Obligations; Replacement of Lenders.
(a) If any Lender requests compensation under Section 2.15, or if the
Borrower is required to pay any additional amount to any Lender or any
Governmental Authority for the account of any Lender pursuant to
Section 2.17, then such Lender shall use reasonable efforts to designate a
different lending office for funding or booking its Loans hereunder or to
assign its rights and obligations hereunder to another of its offices,
branches or affiliates, if, in the judgment of such Lender, such designation
or assignment (i) would eliminate or reduce amounts payable pursuant to
Section 2.15 or 2.17, as the case may be, in the future and (ii) would not
subject such Lender to any unreimbursed cost or expense and would not other-
wise be disadvantageous to such Lender. The Borrower hereby agrees to pay
all reasonable costs and expenses incurred by any Lender in connection with
any such designation or assignment.
(b) If any Lender requests compensation under Section 2.15, or if
the Borrower is required to pay any additional amount to any Lender or any
Governmental Authority for the account of any Lender pursuant to
Section 2.17, or if any Lender defaults in its obligation to fund Loans
hereunder, or if any Lender does not agree to any request for an extension of
the Maturity Date under Section 2.04(a), then the Borrower may, at its sole
expense and effort, upon notice to such Lender and the Administrative Agent,
require such Lender to assign and delegate, without recourse (in accordance
with and subject to the restrictions contained in Section 9.04), all its
interests, rights and obligations under this Agreement to an assignee that
shall assume such obligations (which assignee may be another Lender, if a
Lender accepts such assignment); provided that (i) the Borrower shall have
received the prior written consent of the Administrative Agent and the
Issuing Banks, which consent shall not unreasonably be withheld, (ii) such
Lender shall have received payment of an amount equal to the outstanding
principal of its Loans and participations in LC Disbursements, accrued
interest thereon, accrued fees and all other amounts payable to it hereunder,
from the assignee (to the extent of such outstanding principal and accrued
interest and fees) or the Borrower (in the case of all other amounts) and
(iii) in the case of any such assignment resulting from a claim for
compensation under Section 2.15 or payments required to be made pursuant to
Section 2.17, such assignment will result in a reduction in such compensation
or payments. A Lender shall not be required to make any such assignment and
delegation if, prior thereto, as a result of a waiver by such Lender or
otherwise, the circumstances entitling the Borrower to require such
assignment and delegation cease to apply.
ARTICLE III
Representations and Warranties
-------------------------------
The Borrower represents and warrants to the Lenders that:
SECTION 3.01. Organization; Powers. Each of the Borrower and its
Consolidated Subsidiaries is duly organized, validly existing and in good
standing under the laws of the jurisdiction of its organization, has all
requisite corporate, partnership, limited liability company or other
applicable organizational power and authority to carry on its business as now
conducted and, except where the failure to do so, individually or in the
aggregate, could not reasonably be expected to result in a Material Adverse
Effect, is qualified to do business in, and is in good standing in, every
jurisdiction where such qualification is required.
SECTION 3.02. Authorization; Enforceability. The Transactions are
within the Borrower's corporate powers and have been duly authorized by all
necessary corporate and, if required, stockholder action. This Agreement has
been duly executed and delivered by the Borrower and constitutes, the Second
Indenture constitutes, and each other Loan Document to which the Borrower is
to be a party, when executed and delivered by the Borrower (and, in the case
of the Collateral Mortgage Bonds, authenticated by the trustee therefor),
will constitute, a legal, valid and binding obligation of the Borrower,
enforceable in accordance with its terms, subject to applicable bankruptcy,
insolvency, reorganization, moratorium or other laws affecting creditors'
rights generally and subject to general principles of equity, regardless of
whether considered in a proceeding in equity or at law.
SECTION 3.03. Governmental Approvals; No Conflicts. The
Transactions (a) do not require any consent or approval of, registration or
filing with, or any other action by, any Governmental Authority, except for
the approval of the ACC, which has been obtained and is in full force and
effect and except filings necessary to perfect Liens created under the Loan
Documents (other than the Lien of the Second Indenture, in respect of which
all requisite filings have been made), (b) will not violate any applicable
law or regulation or the charter, by-laws or other organizational documents
of the Borrower or any of its Consolidated Subsidiaries or any order of any
Governmental Authority, (c) will not violate or result in a default under any
indenture, agreement or other instrument binding upon the Borrower or any of
its Consolidated Subsidiaries or its assets, or give rise to a right
thereunder to require any payment to be made by the Borrower or any of its
Consolidated Subsidiaries, and (d) will not result in the creation or
imposition of any Lien on any asset of the Borrower or any of its
Consolidated Subsidiaries, except Liens created under the Loan Documents or
under the Second Indenture.
SECTION 3.04. Financial Condition; No Material Adverse Change.
(a) The Borrower has heretofore furnished to the Lenders the consolidated
and consolidating balance sheet and statements of income, stockholders'
equity and cash flows for the Borrower and its consolidated Subsidiaries
(i) as of and for the fiscal year ended December 31, 1996, which, in the case
of the consolidated statements, are reported on by Deloitte & Touche LLP,
independent public accountants, and, in the case of the consolidating
statements, are certified by its chief financial officer or controller and
(ii) as of and for the fiscal quarter and the portion of the fiscal year
ended September 30, certified by its chief financial officer. Such financial
statements present fairly, in all material respects, the financial position
and results of operations and cash flows of the Borrower and its consolidated
Subsidiaries as of such dates and for such periods in accordance with GAAP,
subject to year-end audit adjustments and the absence of footnotes in the
case of the statements referred to in clause (ii) above. Neither the
Borrower nor any of its Consolidated Subsidiaries had, at the date of the
most recent balance sheet referred to above, any Guarantee, contingent
liability or liability for taxes, or any long-term lease or unusual forward
or long-term commitment, including any interest rate or foreign currency swap
or exchange transaction, which, in any case, is material to the Borrower and
its Consolidated Subsidiaries, taken as a whole, and which is not reflected
in the foregoing statements or in the notes thereto. During the period from
December 31, 1996 to and including the Effective Date there has been no sale,
transfer or other disposition by the Borrower or any of its Consolidated
Subsidiaries of any part of its business or property, and no purchase or
other acquisition of any business or property (including any capital stock of
any other Person), which, in either case, is material in relation to the
consolidated financial condition of the Borrower and its Consolidated
Subsidiaries taken as a whole at December 31, 1996.
(b) Except to the extent that any specific change explicitly
disclosed in the Disclosure Documents may be so considered, since
December 31, 1996, there has been no material adverse change in the financial
condition, results of operations, business or prospects of the Borrower and
its Consolidated Subsidiaries, taken as a whole.
SECTION 3.05. Properties. (a) Other than as explicitly disclosed
in the Disclosure Documents, each of the Borrower and its Consolidated
Subsidiaries has good title to, or valid leasehold interests in, and enjoys
peaceful and undisturbed possession of all its real and personal property
material to its business, except for minor defects in title that do not
interfere with its ability to conduct its business as currently conducted or
to utilize such properties for their intended purposes.
(b) Each of the Borrower and its Consolidated Subsidiaries owns,
or is licensed to use, all trademarks, tradenames, copyrights, patents and
other intellectual property material to its business, and the use thereof by
the Borrower and its Subsidiaries does not infringe upon the rights of any
other Person, except for any such infringements that, individually or in the
aggregate, could not reasonably be expected to result in a Material Adverse
Effect.
SECTION 3.06. Litigation and Environmental Matters. (a) Except
as explicitly disclosed in the Disclosure Documents, there are no actions,
suits or proceedings by or before any arbitrator or Governmental Authority
pending against or, to the knowledge of the Borrower, threatened against or
affecting the Borrower or any of its Consolidated Subsidiaries (i) as to
which there is a reasonable possibility of an adverse determination and that,
if adversely determined, would individually or in the aggregate, result in a
Material Adverse Effect or (ii) that involve any of the Loan Documents, the
Second Indenture or the Transactions.
(b) Except as explicitly disclosed in the Disclosure Documents,
and except with respect to any other matters that, individually or in the
aggregate, could not reasonably be expected to result in a Material Adverse
Effect, neither the Borrower nor any of its Consolidated Subsidiaries (i) has
failed to comply with any Environmental Law or to obtain, maintain or comply
with any permit, license or other approval required under any Environmental
Law, (ii) has become subject to any Environmental Liability, (iii) has
received notice of any claim with respect to any Environmental Liability or
(iv) knows of any basis for any Environmental Liability.
(c) Since the date of this Agreement, there has been no change in
the status of any matter disclosed in the Disclosure Documents that,
individually or in the aggregate, has resulted in, or materially increased
the likelihood of, a Material Adverse Effect.
SECTION 3.07. Compliance with Laws and Agreements. Except as
explicitly disclosed in the Disclosure Documents, each of the Borrower and
its Consolidated Subsidiaries is in compliance with all laws, regulations and
orders of any Governmental Authority applicable to it or its property and all
indentures, agreements and other instruments binding upon it or its property,
except where the failure to do so, individually or in the aggregate, could
not reasonably be expected to result in a Material Adverse Effect. No
Default has occurred and is continuing.
SECTION 3.08. Investment and Holding Company Status. (a) Neither
the Borrower nor any of its Consolidated Subsidiaries is an "investment
company" or a company "controlled" by an "investment company" as defined in,
or subject to regulation under, the Investment Company Act of 1940.
(b) The Borrower and its Consolidated Subsidiaries are exempt from
all provisions of the Public Utility Holding Company Act of 1935, as amended
except Section 9(a)(2) thereof; and no order, consent, approval or
authorization is required under such Act in connection with the making of the
Loans hereunder or the consummation of any of the other Transactions.
SECTION 3.09. Taxes. Each of the Borrower and its Consolidated
Subsidiaries has timely filed or caused to be filed all Tax returns and
reports required to have been filed and has paid or caused to be paid all
Taxes required to have been paid by it, except (a) Taxes that are being
contested in good faith by appropriate proceedings and for which the Borrower
or such Subsidiary, as applicable, has set aside on its books adequate
reserves or (b) to the extent that the failure to do so could not reasonably
be expected to result in a Material Adverse Effect.
SECTION 3.10. ERISA. No ERISA Event has occurred or is reasonably
expected to occur that, when taken together with all other such ERISA Events
for which liability is reasonably expected to occur, would result in a
Material Adverse Effect. The present value of all accumulated benefit
obligations under each Plan (based on the assumptions used for purposes of
Statement of Financial Accounting Standards No. 87) did not, as of the date
of the most recent financial statements reflecting such amounts, exceed by
more than $25,000,000 the fair market value of the assets of such Plan, and
the present value of all accumulated benefit obligations of all underfunded
Plans (based on the assumptions used for purposes of Statement of Financial
Accounting Standards No. 87) did not, as of the date of the most recent
financial statements reflecting such amounts, exceed by more than $25,000,000
the fair market value of the assets of all such underfunded Plans.
SECTION 3.11. Security Documents. (a) The Collateral Mortgage
Bonds are entitled to the benefits of the Second Indenture and secured by the
Lien of the Second Indenture. Upon delivery of the Collateral Mortgage Bonds
to the Administrative Agent under the Bond Delivery Agreement and at all
times thereafter (except as contemplated by Section 9.14), the Collateral
Mortgage Bonds will be "Outstanding" and the Administrative Agent will be the
"Holder" of the Collateral Mortgage Bonds for all purposes of the Second
Indenture. The Second Indenture constitutes a valid mortgage lien on and a
valid and perfected security interest in the properties or franchises
described therein as being subject to the Lien of the Second Indenture. As
of the date hereof no material properties or franchises subject to the Lien
of the Second Indenture have been released from such Lien, and, as of any
subsequent date, no such properties or franchises shall have been released
from the Lien of the Second Indenture except in accordance with the terms
thereof.
(b) The provisions of the Security Documents not covered by
paragraph (a) above are effective to create, in favor of the Administrative
Agent for the benefit of the secured parties thereunder, legal, valid and
enforceable Liens on or in all of the Collateral subject thereto, and all
necessary deliveries of property to the Administrative Agent and all
necessary and appropriate recordings and filings have been made in all
necessary and appropriate public offices so that the Liens created by such
Security Documents constitute perfected Liens on or in all rights, titles,
estates and interests of the Borrower and any applicable Subsidiaries in the
Collateral covered thereby, prior and superior to all other Liens and all
necessary and appropriate consents to the creation and perfection of such
Liens have been obtained. No mortgage or financing statement or other
instrument or recordation covering all or any part of the Collateral is on
file in any recording office which has not been terminated or released,
except as may have been filed in favor of the Administrative Agent.
SECTION 3.12. Disclosure. The Borrower has disclosed to the
Lenders all agreements, instruments and corporate or other restrictions to
which it or any of its Subsidiaries is subject, and all other matters known
to it, that, individually or in the aggregate, would result in a Material
Adverse Effect. Neither the Information Memorandum nor any of the other
reports, financial statements, certificates or other information furnished by
or on behalf of the Borrower to the Administrative Agent or any Lender in
connection with the negotiation of this Agreement or any other Loan Document
or delivered hereunder (as modified or supplemented by, and taken together
with other information so furnished) contains any misstatement of a material
fact or omits to state any material fact necessary to make the statements
therein, in the light of the circumstances under which they were made, not
misleading; provided that, with respect to forward looking statements, the
Borrower represents only that such information was prepared in good faith
based upon assumptions believed to be reasonable at the time and notes that
there can be no assurance that such expectations, beliefs or projections will
be achieved or accomplished and that such projections are subject to an
increasing degree of uncertainty as they relate to later periods of time.
ARTICLE IV
Conditions
----------
SECTION 4.01. Effective Date. The obligations of the Lenders to
make Loans and of the Issuing Banks to issue Letters of Credit hereunder
shall not become effective until the date on which each of the following
conditions is satisfied (or waived in accordance with Section 9.02):
(a) The Administrative Agent (or its counsel) shall have received
from each party hereto either (i) a counterpart of this Agreement signed
on behalf of such party or (ii) written evidence satisfactory to the
Administrative Agent (which may include telecopy transmission of a
signed signature page of this Agreement) that such party has signed a
counterpart of this Agreement.
(b) The Administrative Agent shall have received a favorable
written opinion (addressed to the Administrative Agent and the Lenders
and dated the Effective Date) of each of (i) Xxxxxx X. Xxxxxx, General
Counsel for the Borrower, substantially in the form of Exhibit E-1,
(ii) Xxxx & Priest LLP, New York, counsel for the Borrower,
substantially in the form of Exhibit E-2, (iii) Xxxxx & Xxxxxx, LLP,
special Arizona real estate counsel for the Borrower, substantially in
the form of Exhibit E-3, and (iv) Xxxxx, Dickason, Sloan, Akin & Xxxx,
PA, special New Mexico counsel for the Borrower, substantially in the
form of Exhibit E-4, and covering such other matters relating to the
Borrower, the Loan Documents, the Second Indenture, the Lien of the
Second Indenture or the Transactions as the Required Lenders shall
reasonably request. The Borrower hereby requests such counsel to
deliver such opinion.
(c) The Administrative Agent shall have received such documents
and certificates as the Administrative Agent or its counsel may
reasonably request relating to the organization, existence and good
standing of the Borrower, the authorization of the Transactions and any
other legal matters relating to the Borrower, the Loan Documents, the
Second Indenture, the Lien of the Second Indenture or the Transactions,
all in form and substance satisfactory to the Administrative Agent and
its counsel.
(d) The Administrative Agent shall have received a certificate,
dated the Effective Date and signed by the President, a Vice President
or a Financial Officer of the Borrower, confirming compliance with the
conditions set forth in paragraphs (a) and (b) of Section 4.02.
(e) The Administrative Agent, the Documentation Agent and the
Syndication Agent shall have received all fees and other amounts due and
payable on or prior to the Effective Date, including all up-front fees
and, to the extent invoiced, reimbursement or payment of all out-of-
pocket expenses required to be reimbursed or paid by the Borrower here-
under or under any other Loan Document.
(f) The Administrative Agent shall have received a counterpart of
the Bond Delivery Agreement signed on behalf of the Borrower, together
with (i) Collateral Mortgage Bonds in an aggregate principal amount not
less than $543,874,718.39, duly issued and authenticated under the
Second Indenture; (ii) a duly executed copy of the Second Supplemental
Indenture and all other documents, instruments and filings relating to
the issuance and authentication of the Collateral Mortgage Bonds under
the Second Indenture; (iii) all documents instruments and filings
creating or perfecting the Lien of the Second Indenture; and (iv) all
other documents and instruments required by law or reasonably requested
by the Administrative Agent to be filed, registered or recorded to
create or perfect the Liens intended to be created under the Security
Documents.
(g) The Administrative Agent shall have received copies of the ACC
order authorizing the Transactions certified by an officer of the
Borrower as being a true and complete copy thereof and as being in full
force and effect.
(h) Simultaneously with the making of the Loans and the issuance
of the Letters of Credit on the Effective Date, (A) the Borrower shall
have repaid in full the principal of all loans outstanding, interest
thereon and other amounts due under the MRA; (B) all commitments of
lenders and issuing banks under the MRA shall have been terminated;
(C) all letters of credit outstanding under the MRA shall have been
returned and canceled (or the Administrative Agent shall be satisfied
with the arrangements made for such cancelation); (D) all Liens securing
any obligation in respect of the MRA shall have been discharged (or the
Administrative Agent shall be satisfied with the arrangements made for
such discharge) and all collateral pledged in respect thereof shall have
been returned to the Borrower or San Xxxxxx; and (E) the Administrative
Agent shall have received a certificate, dated the Effective Date and
signed by the President, a Vice President or a Financial Officer of the
Borrower, confirming compliance with the conditions set forth in
clauses (A) through (D) of this paragraph (h).
Notwithstanding the foregoing, the obligations of the Lenders to make Loans
and of the Issuing Banks to issue Letters of Credit hereunder shall not
become effective unless each of the foregoing conditions is satisfied (or
waived pursuant to Section 9.02) at or prior to 3:00 p.m., New York City
time, on January 31, 1998, (and, in the event such conditions are not so
satisfied or waived, the Commitments shall terminate at such time).
SECTION 4.02. Each Credit Event. The obligation of each Lender to
make a Loan on the occasion of any Borrowing that increases the amount of the
Loans of any Lender outstanding, and of any Issuing Bank to issue, amend or
extend any Letter of Credit, is subject to the satisfaction of the following
conditions:
(a) The representations and warranties of the Borrower set forth
in the Loan Documents shall be true and correct on and as of the date of
such Borrowing or the date of issuance, amendment or extension of such
Letter of Credit, as applicable.
(b) At the time of and immediately after giving effect to such
Borrowing or the issuance, amendment or extension of such Letter of
Credit, as applicable, no Default shall have occurred and be continuing.
Each such Borrowing and each issuance, amendment or extension of a Letter of
Credit shall be deemed to constitute a representation and warranty by the
Borrower on the date thereof as to the matters specified in paragraphs (a)
and (b) of this Section.
ARTICLE V
Affirmative Covenants
----------------------
Until the Commitments have expired or been terminated and the
principal of and interest on each Loan and all fees payable hereunder shall
have been paid in full and all Letters of Credit shall have expired or
terminated and all LC Disbursements shall have been reimbursed, the Borrower
covenants and agrees with the Lenders that:
SECTION 5.01. Financial Statements and Other Information. The
Borrower will furnish to the Administrative Agent and each Lender (or in any
instance in which the Borrower shall so request, the Borrower will furnish
copies to the Administrative Agent and the Administrative Agent will forward
such copies to the Lenders):
(a) as soon as available and in any event within 60 days after the
end of each of the first three fiscal quarterly periods of each fiscal
year of the Borrower, or 15 days after the date on which its quarterly
report for such fiscal quarterly period is required to be filed with the
Securities and Exchange Commission, whichever is later, consolidated
and, consolidating statements of income and cash flows of the Borrower
and its consolidated Subsidiaries for such period and for the period
from the beginning of the respective fiscal year to the end of such
period, and the related consolidated and consolidating balance sheets as
of the end of such period, setting forth in each case in comparative
form the corresponding consolidated and consolidating figures for the
corresponding period in the preceding fiscal year, accompanied by a
certificate of a Financial Officer of the Borrower, which certificate
shall state that the financial statements fairly present in all material
respects the consolidated and consolidating financial condition and
results of operations, as the case may be, of the Borrower and its
consolidated Subsidiaries in accordance with GAAP, consistently applied
(except where noted), as of the end of, and for, such period (subject to
normal year-end audit adjustments);
(b) as soon as available and in any event within 105 days after the
end of each fiscal year of the Borrower, or 15 days after the date on
which its annual report for such fiscal year is required to be filed
with the Securities and Exchange Commission, whichever is later,
consolidated and consolidating statements of income and cash flows of
the Borrower and its consolidated Subsidiaries for such year and the
related consolidated and consolidating balance sheets as of the end of
such year, setting forth in each case in comparative form the
corresponding consolidated and consolidating figures for the preceding
fiscal year, and accompanied (i) in the case of the consolidated
financial statements, by an opinion of independent public accountants of
recognized national standing selected by the Borrower, which opinion
shall not contain any qualification or exception as to the scope of such
audit and shall state that the consolidated financial statements fairly
present in all material respects the consolidated financial condition
and results of operations of the Borrower and its consolidated
Subsidiaries as of the end of, and for, such fiscal year and have been
prepared with GAAP, consistently applied (except where noted), and
(ii) in the case of the consolidating financial statements, (A) by a
certificate of a Financial Officer of the Borrower, which certificate
shall state that the consolidating financial statements fairly present
in all material respects the financial condition and results of
operations of the Borrower and its consolidated Subsidiaries as of the
end of, and for, such fiscal year and have been prepared in accordance
with GAAP, consistently applied (except where noted), and (B) by a
certificate of the independent public accountants referred to in
clause (i) above, which certificate should state that such consolidating
financial statements are the consolidating financial statements that
served as the basis for the audited consolidated financial statements in
respect of which such accountants delivered the opinion referred to in
clause (i) above;
(c) concurrently with any delivery of financial statements under
clause (a) or (b) above, a certificate of a Financial Officer of the
Borrower (i) certifying as to whether a Default has occurred and, if a
Default has occurred, specifying the details thereof and any action
taken or proposed to be taken with respect thereto, (ii) setting forth
reasonably detailed calculations demonstrating compliance with
Sections 6.06, 6.07 and 6.08 and (iii) stating whether any change in
GAAP or in the application thereof not disclosed in any prior such
certificate has occurred since the date of the audited financial
statements referred to in Section 3.04 and, if any such change has
occurred, specifying the effect of such change on the financial
statements accompanying such certificate;
(d) concurrently with any delivery of financial statements under
clause (b) above, a certificate of the accounting firm that reported on
such financial statements stating whether they obtained knowledge during
the course of their examination of such financial statements of any
Default (which certificate may be limited to the extent required by
accounting rules or guidelines);
(e) promptly upon their becoming available, copies of all
registration statements (other than on Form S-8 or any successor form)
and regular periodic reports, if any, that the Borrower shall have filed
pursuant to Section 13(a) or 15 of the Securities Exchange Act of 1934,
as amended, with the Securities and Exchange Commission (or any
governmental agency substituted therefor) or filed with any national
securities exchange;
(f) promptly upon the mailing thereof to the shareholders of the
Borrower generally, copies of all financial statements, reports and
proxy statements so mailed;
(g) promptly upon their becoming available, copies of all current
reports on Form 8-K filed by the Borrower with the Securities and
Exchange Commission, and all similar reports filed with any national
securities exchange;
(h) promptly upon their becoming available, copies of (i) any
certified resolutions of the Board of Directors of the Borrower and net
earnings certificates delivered under the Second Indenture in connection
with the issuance of Bonds upon the basis of net property additions or
deposits of cash; any certificates of a Financial Officer under either
Indenture with respect to amounts charged to replacement reserve,
detailing insurance on the Borrower's property or showing compliance by
the Borrower with the covenants contained in such Indenture; any
supplemental indentures to either Indenture; any redemption notices
under either Indenture; and any notices of defaults under either
Indenture or accelerations of Bonds; (ii) any notices of default under
the documentation for any Sale Leaseback of the Borrower or any
Consolidated Subsidiary, any notices of non-payment of rent or any other
material amounts owing under any such Sale Leaseback documentation and
any notices of acceleration of any amounts due under any such Sale
Leaseback documentation; and (iii) any written notices from the ACC of
non-compliance by the Borrower or its Consolidated Subsidiaries with any
material ACC decision or with any other rules, regulations or orders of
the ACC, and any written notices of any extraordinary audit or investi-
gation by the ACC into the business, affairs or operations of the
Borrower or its Consolidation Subsidiaries;
(i) as soon as practicable and in any event within five Business
Days after the Borrower receives written notice of an upgrading or a
downgrading of the First Mortgage Bonds or the Second Mortgage Bonds by
any Rating Agency, a notice of such upgrading or downgrading; and
(j) promptly following any request therefor, such other information
regarding the operations, business affairs and financial condition of
the Borrower or any Subsidiary, or compliance with the terms of any Loan
Document or the Second Indenture, as the Administrative Agent or any
Lender may reasonably request.
So long as the Borrower is subject to the financial reporting
requirements of the Securities Exchange Act of 1934, as amended, and the
financial statements contained in any quarterly or annual reports filed with
the Securities and Exchange Commission in accordance with such Act and the
rules and regulations promulgated thereunder, such financial statements may
be delivered by the Borrower in satisfaction of its obligations to deliver
consolidated and consolidating financial statements pursuant to clauses (a)
or (b), as the case may be, of this Section 5.01.
SECTION 5.02. Notices of Material Events. The Borrower will
furnish to the Administrative Agent and each Lender prompt written notice of
the following:
(a) the occurrence of any Default;
(b) the filing or commencement of any action, suit or proceeding by
or before any arbitrator or Governmental Authority against or affecting
the Borrower or any Affiliate thereof as to which there is a reasonable
possibility of an adverse determination and that, if adversely
determined, would reasonably be expected to result in a Material Adverse
Effect;
(c) the occurrence of any ERISA Event that, alone or together with
any other ERISA Events that have occurred, would result in liability of
the Borrower and its Subsidiaries in an aggregate amount exceeding
$25,000,000; and
(d) any other development that results in, or would reasonably be
expected to result in, a Material Adverse Effect.
Each notice delivered under this Section shall be accompanied by a statement
of a Financial Officer or other executive officer of the Borrower setting
forth the details of the event or development requiring such notice and any
action taken or proposed to be taken with respect thereto.
SECTION 5.03. Existence; Conduct of Business. The Borrower will,
and will cause each of its Consolidated Subsidiaries to, do or cause to be
done all things necessary to preserve, renew and keep in full force and
effect its legal existence and the rights, licenses, permits, privileges and
franchises material to the conduct of its business, except to the extent the
failure to do so would not reasonably be expected to result in a Material
Adverse Effect; provided that the foregoing shall not prohibit any merger,
consolidation, liquidation or dissolution permitted under Section 6.03.
SECTION 5.04. Payment of Obligations. The Borrower will, and will
cause each of its Consolidated Subsidiaries to, pay its obligations,
including Tax liabilities and assessments (including water assessments by the
Arizona State Land Department), that, if not paid, could result in a Material
Adverse Effect before the same shall become delinquent or in default, except
where (a) the validity or amount thereof is being contested in good faith by
appropriate proceedings, (b) the Borrower or such Subsidiary has set aside on
its books adequate reserves with respect thereto to the extent required by
and otherwise in accordance with GAAP and (c) the failure to make payment
pending such contest could not reasonably be expected to result in a Material
Adverse Effect.
SECTION 5.05. Maintenance of Properties; Insurance. The Borrower
will, and will cause each of its Consolidated Subsidiaries to, (a) keep and
maintain all property material to the conduct of its business in good working
order and condition, ordinary wear and tear excepted, provided that the
Borrower or any of its Consolidated Subsidiaries may discontinue the
operation of any of its properties to the extent, in the judgment of the
Borrower, it is no longer advisable to operate such property, or to the
extent the Borrower or such Subsidiary intends to sell or otherwise dispose
of such property, which disposition is not prohibited by Section 6.04. and
(b) maintain, with financially sound and reputable insurance companies, or
through its own program of self-insurance, insurance in such amounts and
against such risks as are customarily maintained by companies engaged in the
same or similar businesses operating in the same or similar locations.
SECTION 5.06. Books and Records; Inspection Rights. The Borrower
will, and will cause each of its Consolidated Subsidiaries to, keep proper
books of record and account in which entries are made of all dealings and
transactions in relation to its business and activities, all in accordance
with customary and prudent business practices. The Borrower will, and will
cause each of its Consolidated Subsidiaries to, permit any representatives
designated by the Administrative Agent or any Lender, upon reasonable prior
notice, to visit and inspect its properties, and, subject to contractual or
statutory limitations regarding confidential or proprietary information, to
examine and make extracts from its books and records, and to discuss its
affairs, finances and condition with its officers, all at such reasonable
times and as often as reasonably requested.
SECTION 5.07. Compliance with Laws. The Borrower will, and will
cause each of its Consolidated Subsidiaries to, comply with all laws, rules,
regulations and orders of any Governmental Authority applicable to it or its
property, except where the failure to do so, individually or in the
aggregate, would not reasonably be expected to result in a Material Adverse
Effect.
SECTION 5.08. Use of Proceeds and Letters of Credit. The proceeds
of the Loans will be used only for general corporate purposes. No part of
the proceeds of any Loan will be used, whether directly or indirectly, for
any purpose that entails a violation of any of the Regulations of the Board,
including Regulations G, U and X. Letters of Credit will be issued only to
support the Revenue Bonds set forth on Schedule 2.05 for such Letters of
Credit.
SECTION 5.09. Environmental Laws. (a) The Borrower and the
Consolidated Subsidiaries will comply with, and use commercially reasonable
efforts to insure compliance by all tenants and subtenants, if any, with, all
Environmental Laws and obtain and comply with and maintain, and use
commercially reasonable efforts to insure that all tenants and subtenants
obtain and comply with and maintain, any and all licenses, approvals,
registrations or permits required by Environmental Laws, except to the extent
that failure to do so would not reasonably be expected to have a Material
Adverse Effect;
(b) The Borrower and the Consolidated Subsidiaries will conduct
and complete all investigations, studies, sampling and testing, and all
remedial, removal and other actions required under Environmental Laws, except
to the extent that the failure to take such actions would not reasonably be
expected to have a Material Adverse Effect and promptly comply with all
lawful orders and directives of all Governmental Authorities respecting
Environmental Laws, except to the extent that the same are being contested in
good faith by appropriate proceedings and the pendency of such proceedings
would not reasonably be expected to have a Material Adverse Effect
SECTION 5.10. Further Assurances. The Borrower will, and will
cause each of its Consolidated Subsidiaries to, execute any and all further
documents, financing statements, agreements and instruments, and take all
such further actions (including the filing and recording of financing
statements, fixture filings, mortgages, deeds of trust and other documents),
which may be required under any applicable law, or which the Administrative
Agent or the Required Lenders may reasonably request, to effectuate the
transactions contemplated by the Loan Documents or under the Second Indenture
or to grant, preserve, protect or perfect the Liens created or intended to be
created by the Second Indenture or the Security Documents or the validity or
priority of any such Lien, all at the expense of the Borrower. The Borrower
also agrees to provide to the Administrative Agent, from time to time upon
request, evidence reasonably satisfactory to the Administrative Agent as to
the perfection and priority of the Liens created or intended to be created by
the Security Documents or by or under the Second Indenture.
ARTICLE VI
Negative Covenants
------------------
Until the Commitments have expired or terminated and the principal
of and interest on each Loan and all fees payable hereunder have been paid
in full and all Letters of Credit have expired or terminated and all
LC Disbursements shall have been reimbursed, the Borrower covenants and
agrees with the Lenders that:
SECTION 6.01. Indebtedness. The Borrower will not permit:
(a) the aggregate principal amount of First Mortgage Bonds
outstanding at any time to exceed $411,313,000;
(b) the aggregate principal amount of Second Mortgage Bonds
outstanding at any time to exceed $543,875,000, unless such greater
amount is permitted by the Second Indenture;
(c) the aggregate amount of Guarantees by the Borrower and the
Consolidated Subsidiaries (other than Guarantees of the Obligations and
other than Guarantees by the Borrower or any Consolidated Subsidiary of
Indebtedness or obligations of the Borrower or a Consolidated
Subsidiary) outstanding at any time to exceed $30,000,000; or
(d) the aggregate principal amount outstanding at any time of
Indebtedness of Excluded Subsidiaries in which the Borrower owns more
than 50% of the common stock to exceed $185,000,000; provided that
Indebtedness that is non-recourse to the Excluded Subsidiaries shall not
be counted for purposes of determining compliance with this paragraph
(d).
SECTION 6.02. Liens. The Borrower will not, and will not permit
any Consolidated Subsidiary to, create, incur, assume or permit to exist any
Lien on any property or asset now owned or hereafter acquired by it, or
assign or sell any income or revenues or rights in respect of any thereof,
except:
(a) Liens created or existing on the Effective Date; provided that
no such Lien is spread to cover any additional property and the amount
of the Indebtedness secured thereby is not increased;
(b) Liens created pursuant to the Loan Documents;
(c) Liens created pursuant to the Indentures;
(d) any "permitted encumbrances", "prepaid liens" or permitted
"prior liens" (as such terms are defined in the Indentures);
(e) Liens on property not subject to the Lien of the Second
Indenture;
(f) carriers', warehousemen's, mechanics', materialmen's,
repairmen's or other similar Liens arising by operation of law in the
ordinary course of business that are not overdue for a period of more
than 90 days;
(g) Liens on property of San Xxxxxx, provided that in the event any
Lien is placed on property of San Xxxxxx, the Indebtedness secured by
such Lien shall be deemed to be Indebtedness of the Borrower for
purposes of all calculations under Sections 6.06, 6.07 and 6.08;
(h) any Lien on any property or asset which Lien existed prior to
the acquisition thereof by the Borrower or any Consolidated Subsidiary;
provided that such Lien is not created in contemplation of or in
connection with such acquisition, such Lien is not spread to cover any
other property of the Borrower and its Consolidated Subsidiaries, and
the amount of Indebtedness secured thereby is not increased; and
(i) any Liens created to secure Indebtedness (i) which refinances
Indebtedness outstanding on the date of this Agreement, so long as such
Liens apply to no more property, have no greater priority and secure
Indebtedness in a principal amount no greater than the Liens in effect
on the date hereof securing the Indebtedness being refinanced; (ii) in
the form of industrial development revenue bonds, the Borrower's
Indebtedness to the issuer thereon and any Indebtedness incurred to
provide security or credit support therefore; or (iii) created pursuant
to a Sale Leaseback in effect on the date hereof or pursuant to a Sale
Leaseback entered into under Section 6.10.
SECTION 6.03. Fundamental Changes. (a) The Borrower will not,
and will not permit any of its Consolidated Subsidiaries to, merge into or
consolidate with any other Person, or permit any other Person to merge into
or consolidate with it, or sell, transfer, lease or otherwise dispose of (in
one transaction or in a series of transactions) its assets as an entirety or
substantially as an entirety, or all or substantially all of the stock of any
of its Consolidated Subsidiaries (in each case, whether now owned or here-
after acquired), or liquidate or dissolve, except that, if at the time
thereof and immediately after giving effect thereto no Default shall have
occurred and be continuing (i) any Person may merge into the Borrower in a
transaction in which the Borrower is the surviving corporation (ii) any
Consolidated Subsidiary may merge with any other Consolidated Subsidiary, and
(iii) the Borrower may merge with or into or consolidate with or transfer its
assets as an entirety or substantially as an entirety to any Person, so long
as (A) immediately prior to and immediately after giving effect to such
merger, consolidation or transfer, the Person with or into which the Borrower
shall ultimately merge or consolidate or to whom the Borrower shall
ultimately transfer its assets as an entirety or substantially as an entirety
is in the Utility Business, (B) the Required Lenders shall have determined
(so long as such determination is exercised in good faith and after
consultation with the Borrower) that the rating of the first mortgage bonds
(or bonds otherwise denominated that benefit from a first Lien on such
Person's utility assets, or, if such Person has no first mortgage bonds, the
rating of the senior unsecured long-term Indebtedness of such Person that is
not guaranteed and does not benefit from any other credit enhancement) of the
surviving Person of any such merger, consolidation, acquisition or transfer
of assets shall be at least BBB- or higher by S&P and Baa3 or higher by
Xxxxx'x (unless the requirements of this clause (B) shall have been waived by
the Required Lenders); provided that the requirement of this clause (B) shall
be deemed to have been satisfied if, prior to the consummation of any such
merger, consolidation or transfer, the Borrower shall have delivered written
evidence from each such rating agency to the effect that, upon such merger,
consolidation or transfer, the applicable rating of such surviving Person
would be equal to or higher than the ratings specified in this clause (B),
(C) in the case of any merger or consolidation or transfer of assets in which
the Borrower is not the surviving corporation, the Person formed by any such
consolidation or transfer of assets or into which the Borrower shall be
merged or consolidated or to which such assets are transferred shall have
executed an agreement in form reasonably satisfactory to the Administrative
Agent containing an assumption by the surviving Person of the due and
punctual performance of each obligation, agreement, covenant and condition of
each of the Loan Documents and the Second Indenture to be performed or
complied with by the Borrower, and (D) the Administrative Agent shall have
received an opinion of counsel, in form and substance reasonably satisfactory
to the Administrative Agent and its counsel, with respect to the due
authorization, execution, delivery, validity and enforceability of the
assumption agreement referred to in clause (C) of this Section 6.03, of the
enforceability and continuation of the Liens created pursuant to the Security
Documents and such other matters as the Required Lenders may reasonably
require.
(b) The Borrower will not, and will not permit any of its
Consolidated Subsidiaries to, engage to any material extent in any business
other than the Utility Business.
SECTION 6.04. Sale of Assets. The Borrower will not, and will not
permit any of its Consolidated Subsidiaries to, convey, sell, lease, assign,
transfer or otherwise dispose of any of its property, business or assets
(including leasehold interests), whether owned or hereafter acquired, except:
(a) inventory and other property in the ordinary course of
business;
(b) sales of accounts receivable;
(c) property, businesses or assets (including receivables and
leasehold interests) with an aggregate Fair Value not in excess of
$250,000,000; provided that the aggregate Fair Value of such property,
businesses or assets permitted to be disposed of pursuant to this
clause (c) shall be increased on a dollar for dollar basis by the
aggregate amount of each reduction of the Commitments in respect of
which the Borrower shall have given the Administrative Agent, for the
benefit of the Lenders, written evidence of the Borrower's agreement not
to issue Indebtedness under the Second Indenture based upon the Second
Mortgage Bonds retired in connection with such reduction;
(d) property in connection with any securitization (e.g., stranded
costs) or sale of assets required by law; provided that not less than
80% of the proceeds of such securitization or sale are applied to reduce
outstanding Indebtedness of the Borrower;
(e) any or all of the Borrower's interests in the capital stock of
any Excluded Subsidiary; and
(f) any sale of the Borrower's assets as an entirety or
substantially as an entirety in accordance with Section 6.03, provided
that any assets of the Borrower not included in such sale shall be
deemed to have been disposed of in a transaction subject to the
limitations of this Section 6.04, including the dollar limit set forth
in clause (c) above.
provided, that any Consolidated Subsidiary may convey, sell, lease, assign,
transfer or otherwise dispose of any of its property, business or assets to
the Borrower or any other Consolidated Subsidiary. Investments by the
Borrower and the Consolidated Subsidiaries in, and contributions by the
Borrower and the Consolidated Subsidiaries to, Consolidated Subsidiaries or
Excluded Subsidiaries shall be deemed not to constitute transfers of assets
subject to the limitations of this Section 6.04 to the extent such
investments or contributions are made in cash.
SECTION 6.05. Restricted Payments. The Borrower will not declare
or make, or agree to pay or make, directly or indirectly, any Restricted
Payment at any time that any Default or Event of Default has occurred and is
continuing or would occur as a result of such action, except that (a) the
Borrower may declare and pay dividends with respect to its capital stock
payable solely in additional shares of its common stock and (b) the Borrower
may make Restricted Payments pursuant to and in accordance with stock option
plans or other benefit plans for management or employees of the Borrower and
its Subsidiaries.
SECTION 6.06. Consolidated Tangible Net Worth. The Borrower will
not permit Consolidated Tangible Net Worth as of the last day of any fiscal
quarter following the Effective Date to be less than (a) the sum of
(i) $133,000,000, (ii) 40% of Consolidated Net Income for each fiscal year
after December 31, 1996, for which Consolidated Net Income is positive and
(iii) with respect to each of the first three fiscal quarters of a fiscal
year after the most recent fiscal year end, 40% of Consolidated Net Income as
of the end of such fiscal quarter, taken on a fiscal year-to-date basis, if
positive, minus (b) the least of (x) $175,000,000, (y) the aggregate amount
of non-cash charges taken by the Borrower after the date hereof pursuant to
the requirements of SFAS 101 and (z) in the event that either Reference
Rating shall be downgraded within 90 days after the public disclosure of any
decision by the Borrower to apply SFAS 101, zero.
SECTION 6.07. Cash Coverage Ratio. The Borrower will not permit
the ratio of (a) Consolidated EBITDA plus Consolidated Capital Lease Expense
minus Consolidated Capital Expenditures to (b) Consolidated Interest Expense,
in each case for the twelve-month period ended on the last day of any fiscal
quarter commencing with the fiscal quarter ended December 31, 1997, to be
less than the amount specified in the chart below for any such day occurring
in the applicable calendar year:
Year Minimum Ratio
---- -------------
1997 and 1998 1.30
1999 1.40
2000 1.40
2001 1.50
2002 1.55
SECTION 6.08. Leverage Test. The Borrower will not permit the
ratio of (a) Consolidated Total Indebtedness to (b) the sum of Consolidated
EBITDA and Consolidated Capital Lease Expense, in each case for the twelve-
month period ended on the last day of any fiscal quarter commencing with the
fiscal quarter ended December 31, 1997, to be more than the amount specified
in the chart below for any such day occurring in the applicable calendar
year:
Year Maximum Ratio
---- -------------
1997 and 1998 7.00
1999 6.80
2000 6.60
2001 6.40
2002 6.20
SECTION 6.09. Amendments to Documents. The Borrower will not, and
will not permit any Consolidated Subsidiary to, amend, modify or change, or
consent or agree to any amendment, modification or change to the Second
Indenture, the Second Supplemental Indenture, any Revenue Bond Indenture, any
Revenue Bond Loan Agreement or any Revenue Bonds without the prior written
consent of the Required Lenders and any Issuing Bank affected thereby,
provided that (a) such consent shall not be required in connection with any
amendment of the Second Indenture for which the Second Indenture does not
require the consent of any bondholder and (b) such consent shall not be
unreasonably withheld with respect to any amendment of the Second Indenture
that has been approved by bondholders entitled to vote under the Second
Indenture who hold bonds in an aggregate principal amount greater than the
principal amount of the Collateral Mortgage Bonds.
SECTION 6.10. Sale Leaseback Transactions. The Borrower will not,
and will not permit any of its Consolidated Subsidiaries to, enter into any
Sale Leaseback if the aggregate annual basic rent payments under all Sale
Leasebacks entered into by the Borrower and its Consolidated Subsidiaries
after the date hereof would exceed $20,000,000 in any fiscal year after
giving effect to such Sale Leaseback.
SECTION 6.11. Excluded Subsidiaries. (a) The Borrower will not
fail to designate any Excluded Subsidiary as a Consolidated Subsidiary
promptly upon becoming aware that the calculations demonstrating compliance
with Sections 6.06, 6.07 or 6.08 contained in the certificate most recently
delivered under Section 5.01(c) would have been different in any respect had
such Excluded Subsidiary not existed or not conducted any business during the
period reported on therein (other than as a result of any adjustment of the
equity account of any Person owning such Subsidiary and other than as a
result of the removal of transactions conducted with such Subsidiary on an
arm's-length basis or otherwise in accordance with the safeguards set forth
for transactions by the Borrower with certain Affiliates in Decision
No. 60480 of the ACC or as specifically permitted under Section 6.01(c)
("arm's-length transactions")).
(b) The Borrower will not, and will not permit any of its
Consolidated Subsidiaries to, engage in any transaction with any Excluded
Subsidiary other than arm's-length transactions.
ARTICLE VII
Events of Default
------------------
If any of the following events ("Events of Default") shall occur:
(a) the Borrower shall fail to pay any principal of any Loan or any
reimbursement obligation in respect of any LC Disbursement 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 otherwise, subject in the
case of any such reimbursement obligation to a grace period of two days;
(b) the Borrower shall fail to pay any interest on any Loan or any
fee or any other amount (other than an amount referred to in clause (a)
of this Article) payable under this Agreement or any other Loan
Document, when and as the same shall become due and payable, and such
failure shall continue unremedied for a period of five days;
(c) any representation or warranty made or deemed made by or on
behalf of the Borrower or any Consolidated Subsidiary in or in
connection with any Loan Document or any amendment or modification
hereof or waiver hereunder, or in any report, certificate, financial
statement or other document furnished pursuant to or in connection with
any Loan Document or any amendment or modification hereof or waiver
hereunder, shall prove to have been incorrect when made or deemed made;
(d) the Borrower shall fail to observe or perform any covenant,
condition or agreement contained in Section 5.02, 5.03 (with respect to
the Borrower's existence) or 5.08 or in Article VI;
(e) the Borrower shall fail to observe or perform any covenant,
condition or agreement contained in any Loan Document (other than those
specified in clause (a), (b) or (d) of this Article), and such failure
shall continue unremedied for a period of 30 days after notice thereof
from the Administrative Agent to the Borrower (which notice will be
given at the request of any Lender);
(f) the Borrower or any Significant Subsidiary shall fail to make
any payment of principal (regardless of amount) in respect of any
Material Indebtedness, when and as the same shall become due and
payable;
(g) any event or condition occurs that results in any Material
Indebtedness becoming due prior to its scheduled maturity or that
enables or permits (with or without the giving of notice, the lapse of
time or both) the holder or holders of any Material Indebtedness or any
trustee or agent on its or their behalf to cause any Material
Indebtedness to become due, or to require the prepayment, repurchase,
redemption (other than pursuant to provisions permitting the tendering
of such Indebtedness from time to time for repurchase or redemption
without regard to the occurrence or non-occurrence of any event or
condition) or defeasance thereof, prior to its scheduled maturity;
provided that this clause (g) shall not apply to secured Indebtedness
that becomes due as a result of the voluntary sale or transfer of the
property or assets securing such Indebtedness;
(h) an involuntary proceeding shall be commenced or an involuntary
petition shall be filed seeking (i) liquidation, reorganization or other
relief in respect of the Borrower or any Consolidated Subsidiary or its
debts, or of a substantial part of its assets, under any Federal, state
or foreign bankruptcy, insolvency, receivership or similar law now or
hereafter in effect or (ii) the appointment of a receiver, trustee,
custodian, sequestrator, conservator or similar official for the
Borrower or any Consolidated Subsidiary or for a substantial part of its
assets, and, in any such case, 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;
(i) the Borrower or any Consolidated Subsidiary shall
(i) voluntarily commence any proceeding or file any petition seeking
liquidation, reorganization or other relief under any Federal, state or
foreign bankruptcy, insolvency, receivership or similar law now or here-
after in effect, (ii) consent to the institution of, or fail to contest
in a timely and appropriate manner, any proceeding or petition described
in clause (h) of this Article, (iii) apply for or consent to the
appointment of a receiver, trustee, custodian, sequestrator, conservator
or similar official for the Borrower or any Consolidated Subsidiary or
for a substantial part of its assets, (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
or (vi) take any action for the purpose of effecting any of the fore-
going;
(j) the Borrower or any Consolidated Subsidiary shall become
unable, admit in writing its inability or fail generally to pay its
debts as they become due;
(k) one or more judgments for the payment of money in an aggregate
amount in excess of $15,000,000 shall be rendered against the Borrower,
any Consolidated 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 attach or levy upon any assets
of the Borrower or any Consolidated Subsidiary to enforce any such
judgment;
(l) an ERISA Event shall have occurred that, when taken together
with all other ERISA Events that have occurred, would result in a
Material Adverse Effect; or
(m) (i) any Lien purported to be created under any Security
Document or the Second Indenture shall cease to be, or shall be asserted
by the Borrower or any Consolidated Subsidiary not to be, a valid and
perfected Lien on any collateral subject thereto, with the priority
required by the applicable Security Document or the Second Indenture, as
applicable, except (A) as a result of the sale or other disposition of
the applicable Collateral in a transaction permitted under the Loan
Documents or (B) as a result of the Administrative Agent's failure to
maintain possession of any stock certificates, promissory notes or other
instruments delivered to it under any Security Document or (ii) any
Collateral Mortgage Bond shall for any reason (x) cease to be entitled
to the benefits of the Second Indenture or to be secured by the Lien of
the Second Indenture equally and ratably with all other bonds, if any,
outstanding under the Second Indenture or (y) cease to be a legal, valid
and binding obligation of the Borrower;
then, and in every such event (other than an event with respect to the
Borrower described in clause (h) or (i) of this Article), and at any time
thereafter during the continuance of such event, the Administrative Agent
may, and at the request of the Required Lenders shall, by notice to the
Borrower, take any or all of the following actions, at the same or different
times: (i) terminate the Commitments, and thereupon the Commitments shall
terminate immediately, (ii) declare the Loans and LC Disbursements then out-
standing to be due and payable in whole (or in part, in which case any
principal not so declared to be due and payable may thereafter be declared to
be due and payable), and thereupon the principal of the Loans and LC
Disbursements so declared to be due and payable, together with accrued
interest thereon and all fees and other obligations of the Borrower accrued
hereunder, shall become due and payable immediately, without presentment,
demand, protest or other notice of any kind, all of which are hereby waived
by the Borrower, (iii) take any action under Section 2.06(j) and (iv) deliver
a notice of redemption under the Second Supplemental Indenture stating that
such notice is being delivered pursuant to this Article VII; and in case of
any event with respect to the Borrower described in clause (h) or (i) of this
Article, the Commitments shall automatically terminate and the principal of
the Loans and LC Disbursements then outstanding, together with accrued
interest thereon and all fees and other obligations of the Borrower accrued
hereunder, shall automatically become due and payable, without presentment,
demand, protest or other notice of any kind, all of which are hereby waived
by the Borrower.
ARTICLE VIII
The Administrative Agent
------------------------
Each of the Lenders and the Issuing Banks hereby irrevocably
appoints the Administrative Agent as its agent and authorizes the
Administrative Agent to take such actions on its behalf and to exercise such
powers as are delegated to the Administrative Agent by the terms of the Loan
Documents, together with such actions and powers as are reasonably incidental
thereto. The Borrower (a) may at any time, with the consent of the Required
Lenders, replace the Administrative Agent and (b) simultaneously with the
replacement of any Affiliate of the Administrative Agent as Issuing Bank
under Section 2.06(i), shall replace the Administrative Agent (it being
understood that any such replacement Administrative Agent shall be a Person
that serves as administrative agent for other credit facilities of a
comparable size), provided that the Borrower may not replace such
Administrative Agent or Issuing Bank unless, after giving effect to such
replacement and each contemporaneous assignment the Borrower shall have
arranged in connection with such replacement (i) neither the Administrative
Agent nor any of its Affiliates shall have outstanding any Letter of Credit,
Loan, LC Disbursement, Commitment or other obligation of any kind under this
Agreement or any other Loan Document and (ii) each of the Administrative
Agent and its Affiliates shall have received payment in full of all amounts
owing to it under or in respect of this Agreement and each other Loan
Document.
The bank serving as the Administrative Agent hereunder shall have
the same rights and powers in its capacity as a Lender as any other Lender
and may exercise the same as though it were not the Administrative Agent, and
such bank and its Affiliates may accept deposits from, lend money to and
generally engage in any kind of business with the Borrower or any Subsidiary
or other Affiliate thereof as if it were not the Administrative Agent
hereunder.
The Administrative Agent shall not have any duties or obligations
except those expressly set forth in the Loan Documents. Without limiting the
generality of the foregoing, (a) the Administrative Agent shall not be
subject to any fiduciary or other implied duties, regardless of whether a
Default has occurred and is continuing, (b) the Administrative Agent shall
not have any duty to take any discretionary action or exercise any
discretionary powers, except discretionary rights and powers expressly
contemplated by the Loan Documents that the Administrative Agent is required
to exercise in writing by the Required Lenders (or such other number or
percentage of the Lenders as shall be necessary under the circumstances as
provided in Section 9.02), and (c) except as expressly set forth in the Loan
Documents, the Administrative Agent shall not have any duty to disclose, and
shall not be liable for the failure to disclose, any information relating to
the Borrower or any of its Subsidiaries that is communicated to or obtained
by the bank serving as Administrative Agent or any of its Affiliates in any
capacity. The Administrative Agent shall not be liable for any action taken
or not taken by it with the consent or at the request of the Required Lenders
(or such other number or percentage of the Lenders as shall be necessary
under the circumstances as provided in Section 9.02) or in the absence of its
own gross negligence or wilful misconduct. The Administrative Agent shall be
deemed not to have knowledge of any Default unless and until written notice
thereof is given to the Administrative Agent by the Borrower or a Lender, and
the Administrative Agent shall not be responsible for or have any duty to
ascertain or inquire into (i) any statement, warranty or representation made
in or in connection with any Loan Document, (ii) the contents of any
certificate, report or other document delivered hereunder or in connection
herewith, (iii) the performance or observance of any of the covenants, agree-
ments or other terms or conditions set forth in any Loan Document, (iv) the
validity, enforceability, effectiveness or genuineness of any Loan Document
or any other agreement, instrument or document, or (v) the satisfaction of
any condition set forth in Article IV or elsewhere in any Loan Document,
other than to confirm receipt of items expressly required to be delivered to
the Administrative Agent. Notwithstanding anything herein to the contrary,
no Lender identified as Syndication Agent or Documentation Agent shall have
any separate duties, responsibilities, obligations or authority as
Syndication Agent or Documentation Agent.
The Administrative Agent shall be entitled to rely upon, and shall
not incur any liability for relying upon, any notice, request, certificate,
consent, statement, instrument, document or other writing believed by it to
be genuine and to have been signed or sent by the proper Person. The
Administrative Agent also may rely upon any statement made to it orally or by
telephone and believed by it to be made by the proper Person, and shall not
incur any liability for relying thereon. The Administrative Agent may
consult with legal counsel (who may be counsel for the Borrower), independent
accountants and other experts selected by it, and shall not be liable for any
action taken or not taken by it in accordance with the advice of any such
counsel, accountants or experts.
The Administrative Agent may perform any and all its duties and
exercise its rights and powers by or through any one or more sub-agents
appointed by the Administrative Agent. The Administrative Agent and any such
sub-agent may perform any and all its duties and exercise its rights and
powers through their respective Related Parties. The exculpatory provisions
of the preceding paragraphs shall apply to any such sub-agent and to the
Related Parties of the Administrative Agent and any such sub-agent, and shall
apply to their respective activities in connection with the syndication of
the credit facilities provided for herein as well as activities as
Administrative Agent.
Subject to the appointment and acceptance of a successor
Administrative Agent as provided in this paragraph, the Administrative Agent
may resign at any time by notifying the Lenders, the Issuing Banks and the
Borrower. Upon any such resignation, the Required Lenders shall have the
right, in consultation with the Borrower, to appoint a successor. If no
successor shall have been so appointed by the Required Lenders and shall have
accepted such appointment within 30 days after the retiring Administrative
Agent gives notice of its resignation, then the retiring Administrative Agent
may, on behalf of the Lenders and the Issuing Banks, appoint a successor
Administrative Agent which shall be a bank with an office in New York,
New York, or an Affiliate of any such bank. Upon the acceptance of its
appointment as Administrative Agent hereunder by a successor, such successor
shall succeed to and become vested with all the rights, powers, privileges
and duties of the retiring Administrative Agent, and the retiring
Administrative Agent shall be discharged from its duties and obligations
hereunder. The fees payable by the Borrower to a successor Administrative
Agent shall be the same as those payable to its predecessor unless otherwise
agreed between the Borrower and such successor. After the Administrative
Agent's resignation hereunder, the provisions of this Article and
Section 9.03 shall continue in effect for the benefit of such retiring
Administrative Agent, its sub-agents and their respective Related Parties in
respect of any actions taken or omitted to be taken by any of them while it
was acting as Administrative Agent.
Each Lender acknowledges that it has, independently and without
reliance upon the Administrative Agent or any other Lender and based on such
documents and information as it has deemed appropriate, made its own credit
analysis and decision to enter into this Agreement. Each Lender also
acknowledges that it will, independently and without reliance upon the
Administrative Agent or any other Lender and based on such documents and
information as it shall from time to time deem appropriate, continue to make
its own decisions in taking or not taking action under or based upon this
Agreement, any other Loan Document or related agreement or any document
furnished hereunder or thereunder.
ARTICLE IX
Miscellaneous
-------------
SECTION 9.01. Notices. Except in the case of notices and other
communications expressly permitted to be given by telephone, all 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 Xxxx Xxxxx Xxxxxx, Xxxxxx,
Xxxxxxx 00000, Attention of Chief Financial Officer (Telecopy
No. (000) 000-0000);
(b) if to the Administrative Agent, to Toronto Dominion (Texas),
Inc., 000 Xxxxxx, Xxxxx 0000, Xxxxxxx, XX 00000, Attention of Manager,
Agency (Telecopy No. (000) 000-0000); and
(c) if to any other Agent, any Issuing Bank, or any Lender, to it
at its address (or telecopy number) set forth in its Administrative
Questionnaire.
Any party hereto may change its address or telecopy number for notices and
other communications hereunder by notice to the other parties 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.
SECTION 9.02. Waivers; Amendments. (a) No failure or delay by
the Administrative Agent, any Issuing Bank or any Lender in exercising any
right or power hereunder or under any other Loan Document or the Second
Indenture 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 Administrative Agent, the Issuing Banks and the Lenders here-
under and under the other Loan Documents and the Second Indenture are
cumulative and are not exclusive of any rights or remedies that they would
otherwise have. No waiver of any provision of any 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) of this Section, and then
such waiver or consent shall be effective only in the specific instance and
for the purpose for which given. Without limiting the generality of the
foregoing, the making of a Loan or issuance of a Letter of Credit shall not
be construed as a waiver of any Default, regardless of whether the Admini-
strative Agent, any Lender or any Issuing Bank may have had notice or
knowledge of such Default at the time.
(b) Neither this Agreement nor any other Loan Document nor any
provision hereof or thereof may be waived, amended or modified except, in the
case of this Agreement, pursuant to an agreement or agreements in writing
entered into by the Borrower and the Required Lenders or by the Borrower and
the Administrative Agent with the consent of the Required Lenders or, in the
case of any other Loan Document, pursuant to an agreement or agreements in
writing entered into by the Administrative Agent and the Borrower, in each
case with the consent of the Required Lenders or, in the case of the Second
Supplemental Indenture or the Collateral Mortgage Bonds, in each case with
the consent of the Required Lenders and as provided by the Second Indenture
with the Administrative Agent exercising the rights of the holder of the
Collateral Mortgage Bonds and acting at the direction of the Required
Lenders; provided that no such agreement shall (i) increase any Commitment of
any Lender without the written consent of such Lender, (ii) reduce the
principal amount of any Loan or LC Disbursement or reduce the rate of
interest thereon, or reduce any fees payable hereunder, without the written
consent of each Lender affected thereby, (iii) postpone the scheduled date of
payment of the principal amount of any Loan or LC Disbursement, or any
interest thereon, or any fees payable hereunder, or reduce the amount of,
waive or excuse any such payment, or postpone the scheduled date of
expiration of any Commitment, without the written consent of each Lender
affected thereby, (iv) change Section 2.18(b) or (c) in a manner that would
alter the pro rata sharing of payments required thereby, without the written
consent of each Lender, (v) change any of the provisions of this Section or
the definition of "Required Lenders" or any other provision of any Loan
Document specifying the number or percentage of Lenders required to waive,
amend or modify any rights hereunder or make any determination or grant any
consent hereunder, without the written consent of each Lender, (vi) change
any provisions of any Loan Document in a manner that by its terms adversely
affects the rights in respect of payments or Collateral of Lenders holding
Revolving Commitments or Loans, on the one hand, differently than those
holding LC Commitments or any LC Exposure, on the other hand, without the
written consent of Lenders holding a majority in interest of each affected
class, or (vii) release all or substantially all the Collateral Mortgage
Bonds or release all or substantially all of any other Collateral from the
Liens of the Security Documents without the consent of each Lender; provided
further that no such agreement shall amend, modify or otherwise affect the
rights or duties of any Agent or any Issuing Bank hereunder without the prior
written consent of such Agent or Issuing Bank, as the case may be; and
provided further any amendment contemplated by Section 2.04(b) in connection
with any extension of the Maturity Date shall require the prior written
consent of the Borrower, the Administrative Agent and each party to this
Agreement that consents to such extension.
SECTION 9.03. Expenses; Indemnity; Damage Waiver. (a) The
Borrower shall pay (i) all reasonable out-of-pocket expenses incurred by the
Administrative Agent and its Affiliates, including the reasonable fees,
charges and disbursements of counsel for the Administrative Agent, in
connection with the syndication of the credit facilities provided for herein,
the preparation and administration of the Loan Documents or any amendments,
modifications or waivers of the provisions hereof (whether or not the trans-
actions contemplated hereby or thereby shall be consummated), (ii) all
reasonable out-of-pocket expenses incurred by any Issuing Bank in connection
with the issuance, amendment or extension of any Letter of Credit or any
demand for payment thereunder and (iii) all out-of-pocket expenses incurred
by the Administrative Agent, any Issuing Bank or any Lender, including the
fees, charges and disbursements of any counsel for the Administrative Agent,
any Issuing Bank or any Lender, in connection with the enforcement or
protection of its rights in connection with the Loan Documents, including its
rights under this Section, or in connection with the Loans made or Letters of
Credit issued hereunder, including all such out-of-pocket expenses incurred
during any workout, restructuring or negotiations in respect of such Loans
or Letters of Credit.
(b) The Borrower shall indemnify the Administrative Agent, each
Issuing Bank and each Lender, and each Related Party of any of the foregoing
Persons (each such Person being called an "Indemnitee") against, and hold
each Indemnitee harmless from, any and all losses, claims, damages,
liabilities and related expenses, including the fees, charges and
disbursements of any counsel for any Indemnitee, incurred by or asserted
against any Indemnitee arising out of, in connection with, or as a result of
(i) the execution or delivery of any Loan Document or any agreement or
instrument contemplated hereby, the performance by the parties of the Loan
Documents of their respective obligations hereunder or the consummation of
the Transactions or any other transactions contemplated hereby, (ii) any Loan
or Letter of Credit or the use of the proceeds therefrom (including any
refusal by any Issuing Bank to honor a demand for payment under a Letter of
Credit if the documents presented in connection with such demand do not
strictly comply with the terms of such Letter of Credit), (iii) any actual or
alleged presence or release of Hazardous Materials on or from any property
owned or operated by the Borrower or any of its Subsidiaries, or any
Environmental Liability related in any way to the Borrower or any of its
Subsidiaries, or (iv) any actual or prospective claim, litigation,
investigation or proceeding relating to any of the foregoing, whether based
on contract, tort or any other theory and regardless of whether any
Indemnitee is a party thereto; 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) To the extent that the Borrower fails to pay any amount
required to be paid by it to any Agent or any Issuing Bank under
paragraph (a) or (b) of this Section, each Lender severally agrees to pay to
such Agent or Issuing Bank, as the case may be, such Lender's Applicable
Percentage (determined as of the time that the applicable unreimbursed
expense or indemnity payment is sought) of such unpaid amount; provided that
the unreimbursed expense or indemnified loss, claim, damage, liability or
related expense, as the case may be, was incurred by or asserted against such
Agent or Issuing Bank in its capacity as such.
(d) To the extent permitted by applicable law, the Borrower shall
not assert, and hereby waives, any claim against any Indemnitee, on any
theory of liability, for special, indirect, consequential or punitive damages
(as opposed to direct or actual damages) arising out of, in connection with,
or as a result of, this Agreement, any other Loan Document or any agreement
or instrument contemplated hereby or thereby, the Transactions, any Loan or
Letter of Credit or the use of the proceeds thereof.
(e) All amounts due under this Section shall be payable promptly
after written demand therefor.
SECTION 9.04. Successors and Assigns. (a) The provisions of this
Agreement shall be binding upon and inure to the benefit of the parties
hereto and their respective successors and assigns permitted hereby
(including any Affiliate of any Issuing Bank that issues any Letter of
Credit), except that the Borrower may not assign or otherwise transfer any of
its rights or obligations hereunder without the prior written consent of each
Lender (and any attempted assignment or transfer by the Borrower without such
consent shall be null and void). Nothing in this Agreement, expressed or
implied, shall be construed to confer upon any Person (other than the parties
hereto, their respective successors and assigns permitted hereby (including
any Affiliate of any Issuing Bank that issues any Letter of Credit) and, to
the extent expressly contemplated hereby, the Related Parties of each of the
Administrative Agent, the Issuing Banks and the Lenders) any legal or
equitable right, remedy or claim under or by reason of this Agreement.
(b) Any Lender may assign to one or more assignees all or a
portion of its rights and obligations under this Agreement (including all or
a portion of its Revolving Commitment or LC Commitment and the Loans at the
time owing to it); provided that (i) except in the case of an assignment to a
Lender or an Affiliate of a Lender, each of the Borrower and the
Administrative Agent (and, in the case of an assignment of all or a portion
of an LC Commitment or any Lender's obligations in respect of its
LC Exposure, the Issuing Banks) must give their prior written consent to such
assignment (which consent shall not be unreasonably withheld), (ii) except in
the case of an assignment to a Lender or an Affiliate of a Lender or an
assignment of the entire remaining amount of the assigning Lender's Revolving
Commitment or LC Commitment, the aggregate amount of the Commitments 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 Administrative Agent) shall not be less than $10,000,000 unless each of
the Borrower and the Administrative Agent otherwise consent, (iii) each
partial assignment of any Lender's Revolving Commitment or Revolving Credit
Exposure, or of any Lender's LC Commitment or LC Exposure shall be made as an
assignment of a proportionate part of all the assigning Lender's rights and
obligations under this Agreement in respect of its Revolving Commitment and
Revolving Credit Exposure or its LC Commitment and LC Exposure, as the case
may be (it being understood that assignments of Revolving Commitments or
Revolving Credit Exposures on the one hand shall not be required to be made
on a proportionate basis with assignments of LC Commitments or LC Exposures
on the other hand), (iv) the parties to each assignment shall execute and
deliver to the Administrative Agent an Assignment and Acceptance, together
with a processing and recordation fee of $3,500, and (v) the assignee, if it
shall not be a Lender, shall deliver to the Administrative Agent an
Administrative Questionnaire; and provided further that any consent of the
Borrower otherwise required under this paragraph shall not be required if an
Event of Default under clause (h) or (i) of Article VII has occurred and is
continuing. Subject to acceptance and recording thereof pursuant to para-
graph (d) of this Section, from and after the effective date specified in
each Assignment and Acceptance 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 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 of the 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 2.15, 2.16, 2.17 and 9.03). Any
assignment or transfer by a Lender of rights or obligations under this
Agreement that does not comply with this paragraph shall be treated for
purposes of this Agreement as a sale by such Lender of a participation in
such rights and obligations in accordance with paragraph (e) of this Section.
(c) The Administrative Agent, acting for this purpose as an agent
of the Borrower, shall maintain at one of its offices in Houston, Texas 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 Commitments
of, and principal amount of the Loans and LC Disbursements 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
Administrative Agent, the Issuing Banks 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, any Issuing Bank and any Lender, at any reasonable time and from
time to time upon reasonable prior notice.
(d) Upon its receipt of a duly completed Assignment and Acceptance
executed by an assigning Lender and an assignee, the assignee's completed
Administrative Questionnaire (unless the assignee shall already be a Lender
hereunder), the processing and recordation fee referred to in paragraph (b)
of this Section and any written consent to such assignment required by para-
graph (b) of this Section, the Administrative Agent shall accept such
Assignment and Acceptance and record the information contained therein in the
Register. No assignment shall be effective for purposes of this Agreement
unless it has been recorded in the Register as provided in this paragraph.
(e) Any Lender may, without the consent of the Borrower, the
Administrative Agent or any Issuing Bank, sell participations to one or more
banks or other entities (a "Participant") in all or a portion of such
Lender's rights and obligations under this Agreement (including all or a
portion of its Commitments and the Loans owing to it); provided 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 and (iii) the Borrower, the Administrative
Agent, the Issuing Banks and the other Lenders shall continue to deal solely
and directly with such Lender in connection with such Lender's rights and
obligations under this Agreement. Any agreement or instrument pursuant to
which a Lender sells such a participation shall provide that such Lender
shall retain the sole right to enforce the Loan Documents and to approve any
amendment, modification or waiver of any provision of the Loan Documents;
provided that such agreement or instrument may provide that such Lender will
not, without the consent of the Participant, agree to any amendment,
modification or waiver described in the first proviso to Section 9.02(b) that
affects such Participant. Subject to paragraph (f) of this Section, the
Borrower agrees that each Participant shall be entitled to the benefits of
Sections 2.15, 2.16 and 2.17 to the same extent as if it were a Lender and
had acquired its interest by assignment pursuant to paragraph (b) of this
Section. To the extent permitted by law, each Participant also shall be
entitled to the benefits of Section 9.08 as though it were a Lender, provided
such Participant agrees to be subject to Section 2.18(c) as though it were a
Lender.
(f) A Participant shall not be entitled to receive any greater
payment under Section 2.15 or 2.17 than the applicable Lender would have been
entitled to receive with respect to the participation sold to such
Participant, unless the sale of the participation to such Participant is made
with the Borrower's prior written consent. A Participant that would be a
Foreign Lender if it were a Lender shall not be entitled to the benefits of
Section 2.17 unless the Borrower is notified of the participation sold to
such Participant and such Participant agrees, for the benefit of the
Borrower, to comply with Section 2.17(e) as though it were a Lender.
(g) Any Lender may at any time pledge or assign a security
interest in all or any portion of its rights under this Agreement to secure
obligations of such Lender, including any pledge or assignment to secure
obligations to a Federal Reserve Bank, and this Section shall not apply to
any such pledge or assignment of a security interest; provided that no such
pledge or assignment of a security interest shall release a Lender from any
of its obligations hereunder or substitute any such pledgee or assignee for
such Lender as a party hereto.
SECTION 9.05. Survival. All covenants, agreements,
representations and warranties made by the Borrower in the Loan Documents and
in the certificates or other instruments delivered in connection with or
pursuant to this Agreement or any other Loan Document shall be considered to
have been relied upon by the other parties hereto and shall survive the
execution and delivery of the Loan Documents and the making of any Loans and
issuance of any Letters of Credit, regardless of any investigation made by
any such other party or on its behalf and notwithstanding that any Agent, any
Issuing Bank or any Lender may have had notice or knowledge of any Default or
incorrect representation or warranty at the time any credit is extended
hereunder, 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 is outstanding and unpaid or any Letter
of Credit is outstanding and so long as any Commitment has not expired or
terminated. The provisions of Sections 2.15, 2.16, 2.17 and 9.03 and
Article VIII shall survive and remain in full force and effect regardless of
the consummation of the transactions contemplated hereby, the repayment of
the Loans, the expiration or termination of the Letters of Credit and the
Commitments or the termination of this Agreement or any provision hereof.
SECTION 9.06. Counterparts; Integration; Effectiveness. 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. This
Agreement, the other Loan Documents and any separate letter agreements with
respect to fees payable to the Administrative Agent, the Syndication Agent
and the Documentation Agent constitute the entire contract among the parties
relating to the subject matter hereof and supersede any and all previous
agreements and understandings, oral or written, relating to the subject
matter hereof. Except as provided in Section 4.01, this Agreement shall
become effective when it shall have been executed by the Administrative Agent
and when the Administrative Agent shall have received counterparts hereof
which, when taken together, bear the signatures of each of the other parties
hereto, and thereafter shall be binding upon and inure to the benefit of the
parties hereto and their respective successors and assigns. Delivery of an
executed counterpart of a signature page of this Agreement by telecopy shall
be effective as delivery of a manually executed counterpart of this
Agreement.
SECTION 9.07. Severability. Any provision of this Agreement held
to be invalid, illegal or unenforceable in any jurisdiction shall, as to such
jurisdiction, be ineffective to the extent of such invalidity, illegality or
unenforceability without affecting the validity, legality and enforceability
of the remaining provisions hereof; and the invalidity of a particular
provision in a particular jurisdiction shall not invalidate such provision in
any other jurisdiction.
SECTION 9.08. Right of Setoff. If an Event of Default shall have
occurred and be continuing, each Lender and each of its Affiliates is hereby
authorized at any time and from time to time, to the fullest extent permitted
by law, to set off and apply any and all deposits (general or special, time
or demand, provisional or final) at any time held and other obligations at
any time owing by such Lender or Affiliate 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 held by such Lender,
irrespective of whether or not such Lender shall have made any demand under
this Agreement and although such obligations may be unmatured. The rights of
each Lender under this Section are in addition to other rights and remedies
(including other rights of setoff) which such Lender may have.
SECTION 9.09. Governing Law; Jurisdiction; Consent to Service of
Process. (a) This Agreement shall be construed in accordance with and
governed by the law of the State of New York.
(b) The Borrower hereby irrevocably and unconditionally submits,
for itself and its property, to the nonexclusive jurisdiction of the Supreme
Court of the State of New York sitting in New York County and of the
United States District Court of the Southern District of New York, and any
appellate court from any thereof, in any action or proceeding arising out of
or relating to any Loan Document, 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 proceeding shall be con-
clusive and may be enforced in other jurisdictions by suit on the judgment or
in any other manner provided by law. Nothing in this Agreement or any other
Loan Document shall affect any right that the Administrative Agent, any
Issuing Bank or any Lender may otherwise have to bring any action or
proceeding relating to this Agreement or any other Loan Document against the
Borrower or its properties in the courts of any jurisdiction.
(c) 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 any other Loan
Document in any court referred to in paragraph (b) of this Section. 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.
(d) 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 or any other Loan Document will affect the right of any party
to this Agreement to serve process in any other manner permitted by law.
SECTION 9.10. 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 ANY LEGAL PROCEEDING DIRECTLY OR INDIRECTLY
ARISING OUT OF OR RELATING TO THIS AGREEMENT OR THE TRANSACTIONS CONTEMPLATED
HEREBY (WHETHER BASED ON CONTRACT, TORT OR ANY OTHER THEORY). 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 BY, AMONG OTHER THINGS, THE MUTUAL WAIVERS AND
CERTIFICATIONS IN THIS SECTION.
SECTION 9.11. 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 shall not affect the construction of, or be taken
into consideration in interpreting, this Agreement.
SECTION 9.12. Confidentiality. Each of the Administrative Agent,
the Issuing Banks and the Lenders agrees to maintain the confidentiality of
the Information (as defined below), except that Information may be disclosed
(a) to its and its Affiliates' directors, officers, employees and agents,
including accountants, auditors, legal counsel and other advisors (it being
understood that the Persons to whom such disclosure is made will be informed
of the confidential nature of such Information and instructed to keep such
Information confidential), (b) to the extent requested by any regulatory
authority, (c) to the extent required by applicable laws or regulations or
by any subpoena or similar legal process, (d) to any other party to this
Agreement, (e) in connection with the exercise of any remedies hereunder or
any suit, action or proceeding relating to this Agreement or any other Loan
Document or the enforcement of rights hereunder, (f) subject to an agreement
containing provisions substantially the same as those of this Section, to any
assignee of or Participant in, or any prospective assignee of or Participant
in, any of its rights or obligations under this Agreement, (g) with the
consent of the Borrower or (h) to the extent such Information (i) becomes
publicly available other than as a result of a breach of this Section or
(ii) becomes available to any Agent, any Issuing Bank or any Lender on a
nonconfidential basis from a source other than the Borrower. For the
purposes of this Section, "Information" means all information received from
the Borrower relating to the Borrower or its business, other than any such
information that is available to any Agent, any Issuing Bank or any Lender on
a nonconfidential basis prior to disclosure by the Borrower; provided that,
in the case of information received from the Borrower after the date hereof,
such information is clearly identified at the time of delivery as
confidential. Any Person required to maintain the confidentiality of
Information as provided in this Section shall be considered to have complied
with its obligation to do so if such Person has exercised the same degree of
care to maintain the confidentiality of such Information as such Person would
accord to its own confidential information.
SECTION 9.13. Interest Rate Limitation. Notwithstanding anything
herein to the contrary, if at any time the interest rate applicable to any
Loan, together with all fees, charges and other amounts which are treated as
interest on such Loan 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 in accordance with applicable law, the rate of interest payable in
respect of such Loan 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 but
were not payable as a result of the operation of this Section shall be
cumulated and the interest and Charges payable to such Lender in respect of
other Loans 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 9.14. Release of Liens. In the circumstances set forth in
Section 2.2(a) of the Bond Delivery Agreement, the Administrative Agent shall
promptly (and the Lenders hereby authorize the Administrative Agent to) upon
the request of the Borrower take such action and execute such documents as
may be reasonably requested by the Borrower and at the Borrower's expense to
release all the Liens created under the Loan Documents and shall surrender to
or upon the order of the Borrower all Second Mortgage Bonds then held by the
Administrative Agent. In addition, in the circumstances set forth in
Section 2.2(b) of the Bond Delivery Agreement, the Administrative Agent shall
promptly (and the Lenders hereby authorize the Administration Agent to) upon
the request of the Borrower and at the Borrower's expense, return to the
Borrower Second Mortgage Bonds held by the Administrative Agent under the
Bond Delivery Agreement in a principal amount equal to the excess of the
aggregate principal amount of such Bonds held by the Administrative Agent
over the greater at such time of the total Commitments and the total Credit
Exposures.
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.
TUCSON ELECTRIC POWER COMPANY,
by
/s/Xxxxx Xxxxxx
------------------------
Name:Xxxxx Xxxxxx
Title:Vice President &
Treasurer
TORONTO DOMINION (TEXAS), INC., as
Administrative Agent,
by
/s/ Xxxxxxx Xxxxxxxxx
----------------------
Name:Xxxxxxx Xxxxxxxxx
Title:Managing Director
THE TORONTO-DOMINION BANK, individually and as
Issuing Bank,
by
/s/ Xxxxxxx Xxxxxxxxx
----------------------
Name:Xxxxxxx Xxxxxxxxx
Title:Managing Director
THE BANK OF NEW YORK, individually and as Issuing Bank and Syndication Agent,
by
/s/ Xxxxxx X. Xxxxxx
---------------------
Name:Xxxxxx X. Xxxxxx
Title:Vice President
SOCIETE GENERALE, individually and as Issuing Bank and Documentation Agent,
by
/s/ J. Xxxxxx Xxxxx
------------------------
Name:J. Xxxxxx Xxxxx
Title:Regional Manager
CIBC INC.
by
/s/ Xxxx Xxxxx
-------------------------
Name:Xxxx Xxxxx
Title:Executive Director
BANK OF SCOTLAND,
by
/s/ Xxxxx Xxxx Tat
------------------------
Name:Xxxxx Xxxx Tat
Title:Vice President
XXXXXX COMMERCIAL PAPER, INC.,
by
/s/ Xxxxxx Xxxx
------------------------
Name:Xxxxxx Xxxx
Title:
BANKERS TRUST COMPANY,
by
/s/ Xxxx Xxx Xxxxx
------------------------
Name:Xxxx Xxx Xxxxx
Title:Managing Director
THE SUMITOMO TRUST & BANKING
CO. LTD., LOS ANGELES AGENCY,
by
/s/ Xxxxxxx Xxxxxxxx
-------------------------
Name:Xxxxxxx Xxxxxxxx
Title:Deputy General Manger
XXXXX FARGO BANK, N.A.,
by
/s/ Xxxx X. Xxxxxxx
------------------------
Name:Xxxx X. Xxxxxxx
Title:Vice President
THE LONG-TERM CREDIT BANK OF
JAPAN, LTD.,
by
/s/ Koh Xxxxxxxx
------------------------
Name:Koh Xxxxxxxx
Title:General Manager
THE INDUSTRIAL BANK OF JAPAN
LIMITED, ACTING THROUGH ITS
LOS ANGELES AGENCY,
by
/s/ Shusai Nagai
------------------------
Name:Shusai Nagai
Title:General Manager
THE MITSUBISHI TRUST AND BANKING CORPORATION,
LOS ANGELES AGENCY,
by
/s/ Yasushi Satomi
------------------------
Name:Yasushi Satomi
Title:Senior Vice President
BHF-BANK AKTIENGESELLSCHAFT,
GRAND CAYMAN BRANCH,
by
/s/ Xxx Xxxxxxxxxxx
------------------------
Name:Xxx Xxxxxxxxxxx
Title:Assistant Vice President
by
/s/ Xxxxx Xxxx
------------------------
Name:Xxxxx Xxxx
Title:Vice President
ABN AMRO BANK N.V.,
by
/s/ Xxxxx X. XxXxxxxx
------------------------
Name:Xxxxx X. XxXxxxxx
Title:Vice President
by
/s/ Xxxxx X. Xxxxxx
--------------------
Name:Xxxxx X. Xxxxxx
Title:Vice President
UNION BANK OF CALIFORNIA,
N.A.,
by
/s/ Xxxxx X. XxXxxxxx
------------------------
Name:Xxxxx X. XxXxxxxx
Title:Vice President
TABLE OF CONTENTS
Page
ARTICLE I Definitions
-----------
SECTION 1.01. Defined Terms...........................................1
SECTION 1.02. Classification of Loans and Borrowings.................20
SECTION 1.03. Terms Generally........................................20
SECTION 1.04. Accounting Terms; GAAP.................................21
ARTICLE II The Credits
-----------
SECTION 2.01. Revolving Commitments..................................21
SECTION 2.02. Loans and Borrowings...................................22
SECTION 2.03. Requests for Revolving Borrowings......................23
SECTION 2.04. Extension of Maturity Date.............................23
SECTION 2.05. Issuance of Letters of Credit on the
Effective Date.......................................24
SECTION 2.06. Letters of Credit--General Terms. .....................25
SECTION 2.07. Funding of Borrowings..................................31
SECTION 2.08. Interest Elections.....................................31
SECTION 2.09. Termination and Reduction
of Commitments.......................................33
SECTION 2.10. Repayment of Loans; Evidence of Debt...................34
SECTION 2.11. Prepayment of Loans....................................35
SECTION 2.12. Fees...................................................36
SECTION 2.13. Interest...............................................37
SECTION 2.14. Alternate Rate of Interest.............................38
SECTION 2.15. Increased Costs........................................39
SECTION 2.16. Break Funding Payments.................................40
SECTION 2.17. Taxes..................................................41
SECTION 2.18. Payments Generally; Pro Rata Treatment;
Sharing of Set-offs..................................42
SECTION 2.19. Mitigation Obligations; Replacement of
Lenders..............................................44
ARTICLE III
Representations and Warranties
------------------------------
SECTION 3.01. Organization; Powers...................................45
SECTION 3.02. Authorization; Enforceability..........................46
SECTION 3.03. Governmental Approvals; No Conflicts...................46
SECTION 3.04. Financial Condition; No Material Adverse
Change...............................................46
SECTION 3.05. Properties.............................................47
SECTION 3.06. Litigation and Environmental Matters...................48
SECTION 3.07. Compliance with Laws and Agreements....................48
SECTION 3.08. Investment and Holding Company Status..................48
SECTION 3.09. Taxes..................................................49
SECTION 3.10. ERISA..................................................49
SECTION 3.11. Security Documents.....................................49
SECTION 3.12. Disclosure.............................................50
ARTICLE IV
Conditions
-----------
SECTION 4.01. Effective Date.........................................51
SECTION 4.02. Each Credit Event......................................53
ARTICLE V
Affirmative Covenants
----------------------
SECTION 5.01. Financial Statements and
Other Information....................................54
SECTION 5.02. Notices of Material Events.............................57
SECTION 5.03. Existence; Conduct of Business.........................58
SECTION 5.04. Payment of Obligations.................................58
SECTION 5.05. Maintenance of Properties; Insurance...................58
SECTION 5.06. Books and Records; Inspection Rights...................59
SECTION 5.07. Compliance with Laws...................................59
SECTION 5.08. Use of Proceeds and Letters of Credit..................59
SECTION 5.09. Environmental Laws.....................................59
SECTION 5.10. Further Assurances.....................................60
ARTICLE VI
Negative Covenants
------------------
SECTION 6.01. Indebtedness...........................................60
SECTION 6.02. Liens..................................................61
SECTION 6.03. Fundamental Changes....................................62
SECTION 6.04. Sale of Assets.........................................63
SECTION 6.05. Restricted Payments....................................64
SECTION 6.06. Consolidated Tangible Net Worth. ......................65
SECTION 6.07. Cash Coverage Ratio....................................65
SECTION 6.08. Leverage Test..........................................65
SECTION 6.09. Amendments to Documents................................66
SECTION 6.10. Sale Leaseback Transactions............................66
ARTICLE VII
Events of Default .........................67
----------------
ARTICLE VIII
The Administrative Agent......................70
------------------------
ARTICLE IX
Miscellaneous
--------------
SECTION 9.01. Notices................................................73
SECTION 9.02. Waivers; Amendments....................................74
SECTION 9.03. Expenses; Indemnity; Damage Waiver.....................75
SECTION 9.04. Successors and Assigns.................................77
SECTION 9.05. Survival...............................................80
SECTION 9.06. Counterparts; Integration; Effectiveness...............81
SECTION 9.07. Severability...........................................81
SECTION 9.08. Right of Setoff........................................81
SECTION 9.09. Governing Law; Jurisdiction; Consent to
Service of Process...................................82
SECTION 9.10. WAIVER OF JURY TRIAL...................................82
SECTION 9.11. Headings...............................................83
SECTION 9.12. Confidentiality........................................83
SECTION 9.13. Interest Rate Limitation...............................84
SECTION 9.14. Release of Liens.......................................84
SCHEDULES:
---------
Schedule 2.01 -- Commitments
Schedule 2.05 -- Letters of Credit
EXHIBITS:
--------
Exhibit A -- Form of Assignment and Acceptance
Exhibit B -- Form of Bond Delivery Agreement
Exhibit C -- Form of Revenue Bond Pledge Agreement
Exhibit D -- Form of Second Supplemental Indenture
Exhibit E-1 -- Form of Opinion of Xxxxxx X. Xxxxxx, General Counsel for the
Borrower
Exhibit E-2 -- Form of Opinion of Xxxx & Priest, New York Counsel for the
Borrower
Exhibit E-3 -- Form of Opinion of Xxxxx & Xxxxxx, special Arizona real estate
counsel for the Borrower
Exhibit E-4 -- Form of Opinion of Xxxxx, Dickason, Sloan, Akin & Xxxx, PA,
special New Mexico counsel for the Borrower
