EXHIBIT 10C
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TXU CORP.
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$500,000,000 THREE-YEAR
REVOLVING CREDIT AGREEMENT
Dated as of May 1, 2002
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CITIBANK, N.A.
as Administrative Agent
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XXXXXXX XXXXX XXXXXX INC.
BANC OF AMERICA SECURITIES, LLC
Joint Lead Arrangers and Co-Book Managers
BANK OF AMERICA, N.A.
Syndication Agent
TABLE OF CONTENTS
Section Page
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ARTICLE I
DEFINITIONS; CONSTRUCTION
SECTION 1.01. Defined Terms..................................................1
SECTION 1.02. Terms Generally...............................................14
ARTICLE II
THE CREDITS
SECTION 2.01. Commitments...................................................15
SECTION 2.02. Loans.........................................................15
SECTION 2.03. Borrowing Procedure...........................................16
SECTION 2.04. Fees..........................................................17
SECTION 2.05. Repayment of Loans; Evidence of Indebtedness..................17
SECTION 2.06. Interest on Loans.............................................17
SECTION 2.07. Default Interest..............................................18
SECTION 2.08. Alternate Rate of Interest....................................18
SECTION 2.09. Termination and Reduction of Commitments......................19
SECTION 2.10. Prepayment....................................................19
SECTION 2.11. Reserve Requirements; Change in Circumstances.................19
SECTION 2.12. Change in Legality............................................21
SECTION 2.13. Pro Rata Treatment............................................21
SECTION 2.14. Sharing of Setoffs............................................22
SECTION 2.15. Payments......................................................22
SECTION 2.16. Taxes.........................................................23
SECTION 2.17. Assignment of Commitments Under Certain Circumstances.........25
ARTICLE III
REPRESENTATIONS AND WARRANTIES
SECTION 3.01. Organization; Powers..........................................26
SECTION 3.02. Authorization.................................................26
SECTION 3.03. Enforceability................................................26
SECTION 3.04. Governmental Approvals........................................26
SECTION 3.05. Financial Statements..........................................26
SECTION 3.06. Litigation....................................................27
SECTION 3.07. Federal Reserve Regulations...................................27
SECTION 3.08. Investment Company Act; Public Utility Holding Company Act....27
SECTION 3.09. No Material Misstatements.....................................27
SECTION 3.10. Taxes.........................................................28
SECTION 3.11. Employee Benefit Plans........................................28
SECTION 3.12. Significant Subsidiaries......................................28
SECTION 3.13. Environmental Matters.........................................28
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SECTION 3.14. Solvency......................................................29
ARTICLE IV
CONDITIONS
SECTION 4.01. Conditions to Initial Loan:...................................29
SECTION 4.02. Conditions for All Loans......................................30
ARTICLE V
COVENANTS
SECTION 5.01. Existence.....................................................31
SECTION 5.02. Business and Properties.......................................31
SECTION 5.03. Financial Statements, Reports, Etc............................31
SECTION 5.04. Insurance.....................................................33
SECTION 5.05. Taxes, Etc....................................................33
SECTION 5.06. Maintaining Records; Access to Properties and Inspections.....33
SECTION 5.07. ERISA.........................................................34
SECTION 5.08. Use of Proceeds...............................................34
SECTION 5.09. Consolidations, Mergers, Sales and Acquisitions of Assets
and Investments in Subsidiaries...............................34
SECTION 5.10. Limitations on Liens..........................................34
SECTION 5.11. Fixed Charge Coverage.........................................37
SECTION 5.12. Equity Capitalization Ratio...................................37
SECTION 5.13. Restrictive Agreements........................................37
ARTICLE VI
EVENTS OF DEFAULT
Article VII
THE AGENT
Article VIII
MISCELLANEOUS
SECTION 8.01. Notices.......................................................41
SECTION 8.02. Survival of Agreement.........................................42
SECTION 8.03. Binding Effect................................................42
SECTION 8.04. Successors and Assigns........................................42
SECTION 8.05. Expenses; Indemnity...........................................45
SECTION 8.06. Right of Setoff...............................................46
SECTION 8.07. Applicable Law................................................46
SECTION 8.08. Waivers; Amendment............................................47
SECTION 8.09. Entire Agreement..............................................47
SECTION 8.10. Severability..................................................47
SECTION 8.11. Counterparts..................................................48
SECTION 8.12. Headings......................................................48
SECTION 8.13. Interest Rate Limitation......................................48
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SECTION 8.14. Jurisdiction; Venue...........................................48
SECTION 8.15. Confidentiality...............................................49
EXHIBITS AND SCHEDULES
Exhibit A - Form of Borrowing Request
Exhibit B - Form of Assignment and Acceptance
Schedule 2.01 - Commitments
Schedule 5.13 - Restrictive Agreements
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THREE-YEAR REVOLVING CREDIT AGREEMENT (the "Agreement"), dated
as of May 1, 2002, among TXU Corp., a Texas corporation (the
"Borrower"); the lenders listed in Schedule 2.01 (together
with their successors and assigns, the "Lenders"); and
Citibank, N.A. ("Citibank"), as administrative agent for the
Lenders (in such capacity, the "Agent").
The Borrower has requested the Lenders to provide the credit facility
hereinafter described in the amounts and on the terms and conditions set forth
herein, the Lenders have so agreed on the terms and conditions set forth herein
and the Agent has agreed to act as agent for the Lenders, on such terms and
conditions;
Accordingly, the parties hereto agree as follows:
ARTICLE I
DEFINITIONS; CONSTRUCTION
SECTION 1.01. Defined Terms.
As used in this Agreement, the following terms shall have the meanings
specified below:
"ABR Borrowing" shall mean a Borrowing comprised of ABR Loans.
"ABR Loan" shall mean any Loan bearing interest at a rate
determined by reference to the Alternate Base Rate in accordance with
the provisions of Article II or any Eurodollar Loan converted (pursuant
to Section 2.08 or 2.12(a)(ii)) to a loan bearing interest at a rate
determined by reference to the Alternate Base Rate.
"Acquisition Date" shall mean the date as of which a person or
group of related persons first acquires more than 30% of the
outstanding Voting Shares of the Borrower (within the meaning of
Section 13(d) or 14(d) of the Exchange Act and the applicable rules and
regulations thereunder).
"Administrative Fees" shall have the meaning assigned to such
term in Section 2.04(b).
"Affiliate" shall mean, when used with respect to a specified
person, another person that directly or indirectly controls or is
controlled by or is under common control with the person specified.
"Agent" shall have the meaning given such term in the preamble
hereto.
"Agreement" shall have the meaning given such term in the
preamble hereto.
"Alternate Base Rate" shall mean, for any day, a rate per
annum (rounded upwards, if necessary, to the next 1/16 of 1%) equal to
the greater of (i) the Federal Funds Effective Rate in effect on such
day plus 1/2 of 1% and (ii) the Prime Rate in effect on such day. For
purposes hereof, "Prime Rate" shall mean the rate of interest per annum
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publicly announced from time to time by the Agent as its "base" rate in
effect at its principal office in New York City; each change in the
Prime Rate shall be effective on the date such change is publicly
announced as effective; and "Federal Funds Effective Rate" shall mean,
for any day, the weighted average of the rates on overnight Federal
funds transactions with members of the Federal Reserve System arranged
by Federal funds brokers, as released on the next succeeding Business
Day by the Federal Reserve Bank of New York, or, if such rate is not so
released for any day which is a Business Day, the arithmetic average
(rounded upwards to the next 1/100th of 1%), as determined by the
Agent, of the quotations for the day of such transactions received by
the Agent from three Federal funds brokers of recognized standing
selected by it. If for any reason the Agent shall have determined
(which determination shall be conclusive absent manifest error;
provided that the Agent shall, upon request, provide to the Borrower a
certificate setting forth in reasonable detail the basis for such
determination) that it is unable to ascertain the Federal Funds
Effective Rate for any reason, including the inability of the Agent to
obtain sufficient quotations in accordance with the terms thereof, the
Alternate Base Rate shall be determined without regard to clause (i) of
the first sentence of this definition until the circumstances giving
rise to such inability no longer exist. Any change in the Alternate
Base Rate due to a change in the Prime Rate or the Federal Funds
Effective Rate shall be effective on the effective date of such change
in the Prime Rate or the Federal Funds Effective Rate, respectively.
"Applicable Margin" shall mean, for any Type of Loan at any
time, the percentage per annum set forth below corresponding to such
Type of Loan in the column under the Applicable Rating Level at the
time of determination.
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Applicable
Rating Xxxxx 0 Xxxxx 0 Xxxxx 0 Xxxxx 0
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Level
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Percentage Per Annum
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Eurodollar 1.125% 1.375% 1.625% 1.875%
Margin
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ABR 0.125% 0.375% 0.625% 0.875%
Margin
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"Applicable Rating Level" shall mean, at any time, the level
set forth below in the row next to the then applicable Debt Rating. If
there is a difference of one level in the Debt Ratings assigned by S&P
and Xxxxx'x, then the higher Debt Rating shall be used for purposes of
determining the Applicable Rating Level and if there is a difference of
more than one level in the Debt Ratings assigned by S&P and Xxxxx'x,
then the Debt Rating one level higher than the lower Debt Rating will
be used for purposes of determining the Applicable Rating Level. Any
change in the Applicable Rating Level shall be effective on the date on
which the applicable rating agency announces any change in the
applicable Debt Rating.
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S&P Debt Rating
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Xxxxx'x Debt Rating Applicable Rating Level
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BBB+ or better 1
Baa1 or better
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BBB 2
Baa2
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BBB- 3
Baa3
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BB+ or below* 4
Ba1 or below*
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* or unrated
"Assignment and Acceptance" shall mean an assignment and
acceptance entered into by a Lender and an assignee in the form of
Exhibit B.
"Board" shall mean the Board of Governors of the Federal
Reserve System of the United States.
"Board of Directors" shall mean the Board of Directors of the
Borrower or any duly authorized committee thereof.
"Borrower" shall have the meaning given such term in the
preamble hereto.
"Borrowing" shall mean a group of Loans of a single Type made
by the Lenders on a single date and as to which a single Interest
Period is in effect.
"Borrowing Request" shall mean a request made pursuant to
Section 2.03 in the form of Exhibit A.
"Business Day" shall mean any day (other than a day which is a
Saturday, Sunday or legal holiday in the State of New York) on which
banks are open for business in New York City; provided, however, that,
when used in connection with a Eurodollar Loan, the term "Business Day"
shall also exclude any day on which banks are not open for dealings in
dollar deposits in the London interbank market.
"A Change in Control" shall be deemed to have occurred if (i)
any person or "group" (within the meaning of Section 13(d) or 14(d) of
the Exchange Act) shall acquire beneficial ownership of more than 30%
of any outstanding class of Voting Shares of the Borrower unless such
acquisition shall have been approved prior to such acquisition date by
a majority of Disinterested Directors of the Borrower or (ii) during
any period of 12 consecutive months, a majority of the members of the
Board of Directors cease to be composed of individuals (A) who were
members of the Board of Directors on the first day of such period, (B)
whose election or nomination to the Board of Directors was approved by
individuals referred to in clause (i) above constituting at the time of
such election or nomination at least a majority of the Board of
Directors or (C) whose election or nomination to the Board of Directors
was approved by individuals referred to in
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clauses (i) and (ii) above constituting at the time of such election
or nomination at least a majority of the Board of Directors.
"Citibank" shall have the meaning given to such term in the
preamble hereto.
"Code" shall mean the Internal Revenue Code of 1986, as the
same may be amended from time to time.
"Commission" shall mean the Public Utility Commission of the
State of Texas.
"Commitment" shall mean, with respect to each Lender, the
commitment of such Lender set forth in Schedule 2.01 hereto to make
Loans, as such Commitment may be permanently terminated or reduced from
time to time pursuant to Section 2.09 or modified from time to time
pursuant to Section 8.04. The Commitment of each Lender shall
automatically and permanently terminate on the Maturity Date if not
terminated earlier pursuant to the terms hereof.
"Commitment Fee" shall have the meaning assigned to such term
in Section 2.04(a).
"Commitment Fee Percentage" shall mean, at any time, the
percentage per annum set forth below in the column under the Applicable
Rating Level at such time and in the row corresponding to the then
applicable tier. The Tier 1 Commitment Fee shall apply for any period
of time during which the outstanding Loans comprise less than 50% of
the Total Commitment. The Tier 2 Commitment Fee shall apply for any
period of time during which the outstanding Loans comprise at least 50%
of the Total Commitment. Any change in the Commitment Fee Percentage
shall be effective on the date on which the applicable rating agency
announces any change in the applicable Debt Rating or on which a change
in the amount of outstanding Loans or the Total Commitment causes a
change in the applicability of the Tier 1 Commitment Fee or the Tier 2
Commitment Fee, as the case may be.
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Applicable Xxxxx 0 Xxxxx 0 Xxxxx 0 Xxxxx 0
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Rating Level
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Percentage Per Annum
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Tier 1
Commitment Fee 0.20% 0.25% 0.30% 0.35%
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Tier 2
Commitment Fee 0.15% 0.20% 0.25% 0.30%
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"Consolidated Earnings Available for Fixed Charges" for any
twelve-month period shall mean (i) consolidated net income, calculated
after deducting preferred stock dividends and preferred securities
distributions of Subsidiaries, but before any extraordinary items and
before the effect in such twelve-month period of any change in
accounting principles promulgated by the Financial Accounting Standards
Board
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becoming effective after December 31, 2001, less (ii) allowances for
equity funds used during construction to the extent that such
allowances, taken as a whole, increased such consolidated net income,
plus (iii) provisions for Federal income taxes, to the extent that
such provisions, taken as a whole, decreased such consolidated net
income, plus (iv) Consolidated Fixed Charges, all determined for such
twelve-month period with respect to the Borrower and its Consolidated
Subsidiaries on a consolidated basis; provided, however, that in
computing Consolidated Earnings Available for Fixed Charges for any
twelve-month period the following amounts shall be excluded to the
extent otherwise included pursuant to the foregoing: (A) the effect of
any regulatory disallowances resolving fuel or other issues in any
proceeding before the Commission or the Railroad Commission of Texas
in an aggregate amount not to exceed $100,000,000, (B) any non-cash
book losses relating to the sale or write-down of assets, (C) one-time
costs of up to $100,000,000 incurred in connection with the
restructuring of certain Subsidiaries of the Borrower in connection
with the 1999 Texas electric industry restructuring legislation (as
described in the Borrower's filings with the SEC) and (D) up to
$100,000,000 of costs incurred in connection with write-offs relating
to the regulatory settlement plan, initially filed with the Commission
on December 31, 2001, of Holdings and certain of its Subsidiaries (as
described in the Borrower's filings with the SEC).
"Consolidated Fixed Charges" for any twelve-month period shall
mean the sum (without duplication) of (i) interest on mortgage bonds,
(ii) interest on other long-term debt, (iii) other interest expense,
including interest on short-term debt and the current portion of
long-term debt, and (iv) preferred stock dividends and preferred
securities distributions of Subsidiaries, all determined for such
twelve-month period with respect to the Borrower and its Consolidated
Subsidiaries on a consolidated basis. For purposes of such calculation,
long-term debt shall not include the principal amount of, or interest
on, Qualified Transition Bonds.
"Consolidated Shareholders' Equity" shall mean the sum
(without duplication) of (i) total common stock equity plus (ii)
preferred and preference stock not subject to mandatory redemption,
each (in the case of clauses (i) and (ii)) determined with respect to
the Borrower and its Consolidated Subsidiaries on a consolidated basis,
plus (iii) Equity-Linked Securities plus (iv) Equity-Credit Preferred
Securities in an aggregate liquidation preference amount not in excess
of $3,000,000,000 plus (or minus) (v) accumulated other comprehensive
loss (or income) up to $1,000,000,000.
"Consolidated Subsidiary" shall mean at any date any
Subsidiary of the Borrower or other entity the accounts of which would
be consolidated with those of the Borrower in its consolidated
financial statements as of such date.
"Consolidated Total Capitalization" shall mean the sum of (i)
total common stock equity, (ii) preferred and preference stock and
preferred securities, (iii) long-term debt (less amounts due currently)
and (iv) short-term debt consisting of commercial paper, notes payable
to unaffiliated entities and long-term debt due currently to the extent
such short-term debt exceeds $4,000,000,000, determined with respect to
the Borrower and its Consolidated Subsidiaries on a consolidated basis.
For purposes of such
6
calculation, long-term debt shall not include the principal amount of,
or interest on, Qualified Transition Bonds.
"Controlled Group" shall mean all members of a controlled
group of corporations and all trades or businesses (whether or not
incorporated) under common control which, together with the Borrower,
are treated as a single employer under Section 414(b) or 414(c) of the
Code.
"Debt Rating" shall mean the rating (whether explicit or
implied) assigned by S&P or Xxxxx'x to the Borrower's senior unsecured
non-credit enhanced long term debt.
"Default" shall mean any event or condition, which upon
notice, lapse of time or both would constitute an Event of Default.
"Disinterested Director" shall mean any member of the Board of
Directors who is not affiliated, directly or indirectly, with, or
appointed by, a person or group of related persons (other than the
Borrower, any Subsidiary of the Borrower, or any pension, savings or
other employee benefit plan for the benefit of employees of the
Borrower and/or any Subsidiary of the Borrower) acquiring the
beneficial ownership of more than 30% of the outstanding Voting Shares
of the Borrower (within the meaning of Section 13(d) or 14(d) of the
Exchange Act, and the applicable rules and regulations thereunder) and
who either was a member of the Board of Directors prior to the
Acquisition Date or was recommended for election by a majority of the
Disinterested Directors in office prior to the Acquisition Date.
"dollars" or "$" shall mean lawful money of the United States
of America.
"Energy" shall mean TXU Energy Company LLC, a Delaware limited
liability company, or any successor thereof.
"Equity-Credit Preferred Securities" shall mean securities,
however denominated, (i) issued by the Borrower or a Consolidated
Subsidiary, (ii) that are not subject to mandatory redemption or the
underlying securities, if any, of which are not subject to mandatory
redemption, (iii) that are perpetual or mature no less than 30 years
from the date of issuance, (iv) the indebtedness issued in connection
with which, including any guaranty, is subordinate in right of payment
to the unsecured and unsubordinated indebtedness of the issuer of such
indebtedness or guaranty, and (v) the terms of which permit the
deferral of the payment of interest or distributions thereon to a date
occurring after the Maturity Date.
"Equity-Linked Securities" shall mean units, however
denominated, consisting of (i) contracts to purchase common stock of
the Borrower and (ii) (A) debt or preferred securities of the Borrower
or a Subsidiary of the Borrower, provided that such debt or preferred
securities may not contain provisions permitting them to be put to the
Borrower or such Subsidiary prior to the settlement of the related
purchase contract or portion thereof or (B) U.S. Treasury securities.
7
"ERISA" shall mean the Employee Retirement Income Security Act
of 1974, as the same may be amended from time to time.
"ERISA Affiliate" shall mean any trade or business (whether or
not incorporated) that is a member of a group of (i) organizations
described in Section 414(b) or (c) of the Code and (ii) solely for
purposes of the Lien created under Section 412(n) of the Code,
organizations described in Section 414(m) or (o) of the Code of which
the Borrower is a member.
"ERISA Event" shall mean (i) any "Reportable Event"; (ii) the
adoption of any amendment to a Plan that would require the provision of
security pursuant to Section 401(a)(29) of the Code or Section 307 of
ERISA; (iii) the incurrence of any liability under Title IV of ERISA
with respect to the termination of any Plan or the withdrawal or
partial withdrawal of the Borrower or any of its ERISA Affiliates from
any Plan or Multiemployer Plan; (iv) the receipt by the Borrower or any
ERISA Affiliate from the PBGC of any notice relating to the intention
to terminate any Plan or Plans or to appoint a trustee to administer
any Plan; (v) the receipt by 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; (vi) the occurrence of a "prohibited transaction" with respect
to which the Borrower or any of its subsidiaries is liable; and (vii)
any other similar event or condition with respect to a Plan or
Multiemployer Plan that could result in liability of the Borrower other
than a liability to pay premiums or benefits when due.
"Eurodollar Borrowing" shall mean a Borrowing comprised of
Eurodollar Loans.
"Eurodollar Loan" shall mean any Loan bearing interest at a
rate determined by reference to the LIBO Rate in accordance with the
provisions of Article II.
"Event of Default" shall have the meaning assigned to such
term in Article VI.
"Exchange Act" shall mean the Securities Exchange Act of 1934,
as amended.
"Facility B Credit Agreement" shall mean the Five-Year Second
Amended and Restated Competitive Advance and Revolving Credit Facility
Agreement, dated as of February 25, 2000, among the Borrower and
certain other parties named therein, as amended, modified or
supplemented from time to time.
"Federal Funds Effective Rate" shall have the meaning set
forth in the definition of "Alternate Base Rate".
"Fees" shall mean the Commitment Fees, the Administrative Fees
and any other fees provided for in the Letter Agreement.
"Financial Officer" of any corporation shall mean the chief
financial officer, principal accounting officer, treasurer, associate
or assistant treasurer, or any responsible officer designated by one of
the foregoing persons, of such corporation.
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"First Mortgage" shall mean (i) the Oncor Mortgage, (ii) any
mortgage and deed of trust entered into by Oncor in order to refund or
replace, or in substitution for, the Oncor Mortgage, and (iii) if and
for so long as any mortgage bonds are issued and outstanding under the
Oncor Mortgage, any other indenture or instrument of Oncor pursuant to
which Oncor issues debt securities secured directly or indirectly by
(A) the Lien created by the Oncor Mortgage and/or (B) any property of
Oncor.
"GAAP" shall mean generally accepted accounting principles,
applied on a consistent basis.
"Governmental Authority" shall mean any Federal, state, local
or foreign court or governmental agency, authority, instrumentality or
regulatory body.
"Holdings" shall mean TXU US Holdings Company (formerly "TXU
Electric Company"), a Texas corporation, or any successor thereof.
"Indebtedness" of any person shall mean all indebtedness
representing money borrowed which is created, assumed, incurred or
guaranteed in any manner by such person or for which such person is
responsible or liable (whether by agreement to purchase indebtedness
of, or to supply funds to or invest in, others or otherwise).
"Interest Payment Date" shall mean, with respect to any Loan,
the last day of the Interest Period applicable thereto and, in the case
of a Eurodollar Loan with an Interest Period of more than three months'
duration, each day that would have been an Interest Payment Date for
such Loan had successive Interest Periods of three months' duration
been applicable to such Loan and, in addition, the date of any
prepayment of each Loan or conversion of such Loan to a Loan of a
different Type.
"Interest Period" shall mean (i) as to any Eurodollar
Borrowing, the period commencing on the date of such Borrowing and
ending on the numerically corresponding day (or, if there is no
numerically corresponding day, on the last day) in the calendar month
that is 1, 2, 3 or 6 months thereafter; provided that, in the case of
any Eurodollar Borrowing made during the 30-day period ending on the
Maturity Date, such period may end on the seventh or fourteenth day
thereafter, as the Borrower may elect and (ii) as to any ABR Borrowing,
the period commencing on the date of such Borrowing and ending on the
earliest of (A) the next succeeding March 31, June 30, September 30 or
December 31, (B) the Maturity Date, and (C) the date such Borrowing is
repaid or prepaid in accordance with Section 2.05 or Section 2.10;
provided, however, that if any Interest Period would end on a day other
than a Business Day, such Interest Period shall be extended to the next
succeeding Business Day unless, in the case of Eurodollar Loans only,
such next succeeding Business Day would fall in the next calendar
month, in which case such Interest Period shall end on the next
preceding Business Day. Interest shall accrue from and including the
first day of an Interest Period to but excluding the last day of such
Interest Period.
"Joint Lead Arrangers" shall mean Banc of America Securities
LLC and Xxxxxxx Xxxxx Xxxxxx Inc. in their capacities as Joint Lead
Arrangers.
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"Lenders" shall have the meaning given such term in the
preamble hereto.
"Letter Agreement" shall mean, collectively, (i) the
Commitment Letter, dated April 22, 2002, among the Borrower, the Agent
and the Joint Lead Arrangers, and (ii) the Fee Letter, dated April 22,
2002, between the Borrower and the Agent, each as amended, modified or
supplemented from time to time.
"LIBO Rate" shall mean, with respect to any Eurodollar
Borrowing for any Interest Period, the rate appearing on Page 3750 of
the Telerate Service (or on any successor or substitute page of such
service, or any successor to or substitute for such service, providing
rate quotations comparable to those currently provided on such page of
such service, as determined by the 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
Agent in immediately available funds in the London interbank market at
approximately 11:00 a.m. London time, two Business Days prior to the
commencement of such Interest Period.
"Lien" shall mean, with respect to any asset, any mortgage,
lien, pledge, charge, security interest or encumbrance of any kind in
respect of such asset. For the purposes of this Agreement, any person
shall be deemed to own subject to a Lien any asset which it has
acquired or holds subject to the interest of a vendor or lessor under
any conditional sale agreement, capital lease or other title retention
agreement relating to such asset.
"Loan" shall mean a revolving loan made pursuant to Section
2.03, whether made as a Eurodollar Loan or an ABR Loan.
"Margin Regulations" shall mean Regulations T, U and X of the
Board as from time to time in effect, and all official rulings and
interpretations thereunder or thereof.
"Margin Stock" shall have the meaning given such term under
Regulation U of the Board.
"Material Adverse Change" shall mean a materially adverse
change in the business, assets, operations or financial condition of
the Borrower and its Subsidiaries taken as a whole that makes the
Borrower unable to perform any of its obligations under this Agreement
or that impairs the rights of, or benefits available to, the Lenders
under this Agreement.
"Maturity Date" shall mean the earlier to occur of (i) May 1,
2005 and (ii) the date of termination or reduction in whole of the
Commitments pursuant to Section 2.09 or Article VI.
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"Moody's" shall mean Xxxxx'x Investors Service, Inc.
"Multiemployer Plan" shall mean a multiemployer plan as
defined in Section 4001(a)(3) of ERISA to which the Borrower or any
ERISA Affiliate is making, or accruing an obligation to make,
contributions, or has within any of the preceding five plan years made,
or accrued an obligation to make, contributions.
"Oncor" shall mean Oncor Electric Delivery Company, a Texas
corporation, or any successor thereof.
"Oncor Mortgage" shall mean the Mortgage and Deed of Trust,
dated as of December 1, 1983, from TXU Electric Company to Irving Trust
Company (now The Bank of New York), Trustee, as amended and
supplemented from time to time and as assumed by Oncor.
"Operating Agreements" shall mean the (i) Operating Agreement,
dated April 28, 1978, as amended by the Modification of Operating
Agreement, dated April 20, 1979, among TXU Mining Company LP and TXU US
Holdings Company (formerly TXU Electric Company, successor to Dallas
Power & Light Company, Texas Electric Service Company and Texas Power &
Light Company) and Energy, TXU Energy Retail Company LP and TXU
Generation Company LP (pursuant to the Assumption Agreement, dated
December 31, 2001, by and among Holdings, Energy, TXU Energy Retail
Company LP and TXU Generation Company LP) (the "TXU Mining Operating
Agreement"), and as the same may be amended from time to time, or (ii)
the Operating Agreement, dated December 15, 1976, between TXU Fuel and
Dallas Power & Light Company, Texas Electric Service Company and Texas
Power & Light Company (the "TXU Fuel Operating Agreement"), as the same
may be amended from time to time, provided that no amendment of the TXU
Mining Operating Agreement or the TXU Fuel Operating Agreement shall
increase the scope of any Lien permitted under Section 5.10(j).
"PBGC" shall mean the Pension Benefit Guaranty Corporation or
any entity succeeding to any or all of its functions under ERISA.
"Permitted Encumbrances" shall mean, as to any person at any
date, any of the following:
(a) (i) Liens for taxes, assessments or governmental charges
not then delinquent and Liens for workers' compensation awards and
similar obligations not then delinquent and undetermined Liens or
charges incidental to construction, Liens for taxes, assessments or
governmental charges then delinquent but the validity of which is
being contested at the time by such person in good faith against which
an adequate reserve has been established, with respect to which levy
and execution thereon have been stayed and continue to be stayed and
which do not impair the use of the property or the operation of such
person's business, (ii) Liens incurred or created in connection with
or to secure the performance of bids, tenders, contracts (other than
for the payment of money), leases, statutory obligations, surety bonds
or appeal bonds, and mechanics' or materialmen's
11
Liens, assessments or similar encumbrances, the existence of which
does not impair the use of the property subject thereto for the
purposes for which it was acquired, and other Liens of like nature
incurred or created in the ordinary course of business;
(b) Liens securing indebtedness, neither assumed nor
guaranteed by such person nor on which it customarily pays interest,
existing upon real estate or rights in or relating to real estate
acquired by such person for any substation, transmission line,
transportation line, distribution line, right of way or similar
purpose;
(c) rights reserved to or vested in any municipality or
public authority by the terms of any right, power, franchise, grant,
license or permit, or by any provision of law, to terminate such
right, power, franchise, grant, license or permit or to purchase or
recapture or to designate a purchaser of any of the property of such
person;
(d) rights reserved to or vested in others to take or
receive any part of the power, gas, oil, coal, lignite or other
minerals or timber generated, developed, manufactured or produced by,
or grown on, or acquired with, any property of such person and Liens
upon the production from property of power, gas, oil, coal, lignite or
other minerals or timber, and the by-products and proceeds thereof, to
secure the obligations to pay all or a part of the expenses of
exploration, drilling, mining or development of such property only out
of such production or proceeds;
(e) easements, restrictions, exceptions or reservations in
any property and/or rights of way of such person for the purpose of
roads, pipe lines, substations, transmission lines, transportation
lines, distribution lines, removal of oil, gas, lignite, coal or other
minerals or timber, and other like purposes, or for the joint or
common use of real property, rights of way, facilities and/or
equipment, and defects, irregularities and deficiencies in titles of
any property and/or rights of way, which do not materially impair the
use of such property and/or rights of way for the purposes for which
such property and/or rights of way are held by such person;
(f) rights reserved to or vested in any municipality or
public authority to use, control or regulate any property of such
person;
(g) any obligations or duties, affecting the property of
such person, to any municipality or public authority with respect to
any franchise, grant, license or permit;
(h) as of any particular time any controls, Liens,
restrictions, regulations, easements, exceptions or reservations of
any municipality or public authority applying particularly to space
satellites or nuclear fuel;
(i) any judgment Lien against such person securing a
judgment for an amount not exceeding 25% of Consolidated Shareholders'
Equity, so long as the finality of such judgment is being contested by
appropriate proceedings conducted in good faith and execution thereon
is stayed;
(j) any Lien arising by reason of deposits with or giving
of any form of security to any federal, state, municipal or other
governmental department, commission,
12
board, bureau, agency or instrumentality, domestic or foreign, for any
purpose at any time as required by law or governmental regulation as a
condition to the transaction of any business or the exercise of any
privilege or license, or to enable such person to maintain
self-insurance or to participate in any fund for liability on any
insurance risks or in connection with workers' compensation,
unemployment insurance, old age pensions or other social security or
to share in the privileges or benefits required for companies
participating in such arrangements; or
(k) any landlords' Lien on fixtures or movable property
located on premises leased by such person in the ordinary course of
business so long as the rent secured thereby is not in default.
"person" shall mean any natural person, corporation, business
trust, joint venture, association, company, limited liability company,
partnership or government, or any agency or political subdivision
thereof.
"Plan" shall mean any employee pension benefit plan described
under Section 3(2) of ERISA (other than a Multiemployer Plan) subject
to the provisions of Title IV of ERISA that is maintained by the
Borrower or any ERISA Affiliate.
"Qualified Transition Bonds" shall mean securities, however
denominated, that are (i) issued by a Consolidated Subsidiary formed
and operating solely for the purpose of (A) purchasing and owning
transition property created under a "financing order" (as such term is
defined in the Texas Utilities Code) issued by the Commission, (B)
issuing such securities pursuant to such order, (C) pledging its
interests in such transition property to secure such securities and (D)
engaging in activities ancillary to those described in clauses (A), (B)
and (C) above, (ii) secured by or otherwise payable from transition
charges authorized pursuant to such order, and (iii) non-recourse to
the Borrower or any of its Consolidated Subsidiaries (other than the
issuer of such securities).
"Register" shall have the meaning given such term in Section
8.04(d).
"Reportable Event" shall mean any reportable event as defined
in Sections 4043(c)(1)-(8) of ERISA or the regulations issued
thereunder (other than a reportable event for which the 30 day notice
requirement has been waived) with respect to a Plan (other than a Plan
maintained by an ERISA Affiliate that is considered an ERISA Affiliate
only pursuant to subsection (m) or (o) of Code Section 414).
"Required Lenders" shall mean, at any time, Lenders having
Commitments representing in excess of 50% of the Total Commitment or,
if the Total Commitment has been terminated, Lenders holding Loans
representing in excess of 50% of the aggregate principal amount of the
Loans outstanding.
"Responsible Officer" of any corporation shall mean any
executive officer or Financial Officer of such corporation and any
other officer or similar official thereof responsible for the
administration of the obligations of such corporation in respect of
this Agreement.
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"S&P" shall mean Standard & Poor's Ratings Services (a
division of The XxXxxx-Xxxx Companies, Inc.).
"SEC" shall mean the United States Securities and Exchange
Commission.
"Significant Disposition" shall mean a sale, lease,
disposition or other transfer by the Borrower or any Significant
Subsidiary during any 12-month period of assets constituting, either
individually or in the aggregate with all other assets sold, leased,
disposed or otherwise transferred by such Borrower or Significant
Subsidiary during such period, 10% or more of the assets of the
Borrower and its Subsidiaries taken as a whole, excluding any such
sale, lease, disposition or other transfer to a Wholly Owned Subsidiary
of the Borrower.
"Significant Subsidiary" shall mean at any time a Subsidiary
of the Borrower that as of such time satisfies the definition of a
"significant subsidiary" contained as of the date of this Agreement in
Regulation S-X of the SEC.
"Solvent" means, with respect to any person as of a particular
date, that on such date such person is able to pay its debts and other
liabilities, contingent obligations and other commitments as they
mature in the normal course of business. In computing the amount of
contingent liabilities at any time, it is intended that such
liabilities will be computed as the amount which, in light of all the
facts and circumstances existing at such time, represents the amount
that can reasonably be expected to become an actual or matured
liability.
"Subsidiary" shall mean, with respect to any person (the
"parent"), any corporation or other entity of which securities or other
ownership interests having ordinary voting power to elect a majority of
the board of directors or other persons performing similar functions
are at the time directly or indirectly owned by such parent.
"Substantial" shall mean an amount in excess of 10% of the
consolidated assets of the Borrower and its Consolidated Subsidiaries
taken as a whole.
"Total Commitment" shall mean, at any time, the aggregate
amount of Commitments of all the Lenders, as in effect at such time.
The Total Commitment as of the date hereof is $500,000,000.
"2001 Agreement" shall mean the 364-Day Competitive Advance
and Revolving Credit Facility Agreement, dated as of February 23, 2001,
as amended, among the Borrower and Holdings, as borrowers, the
financial institutions parties thereto, as lenders, and JPMorgan Chase
Bank, as administrative agent and competitive advance facility agent
thereunder.
"TXU" shall have the meaning given such term in the preamble
hereto.
"TXU Fuel" shall mean TXU Fuel Company, a Texas corporation,
and its successors.
14
"TXU Mining" shall mean TXU Mining Company LP, a Texas limited
partnership, and its successors.
"Type", when used in respect of any Loan or Borrowing, shall
refer to the Rate by reference to which interest on such Loan or on the
Loans comprising such Borrowing is determined. For purposes hereof,
"Rate" shall include the LIBO Rate and the Alternate Base Rate.
"U.K. Facility Agreements" shall mean the Amended and Restated
Facilities Agreements with respect to a (pound)900 million term
facility, a (pound)230 million revolving credit facility and a
(pound)600 million revolving credit facility, each dated November 19,
2001, among TXU Europe Limited, the lenders parties thereto and certain
other parties named therein, as amended, modified or supplemented from
time to time.
"Voting Shares" shall mean, as to shares of a particular
corporation, outstanding shares of stock of any class of such
corporation entitled to vote in the election of directors, excluding
shares entitled so to vote only upon the happening of some contingency.
"Wholly Owned Subsidiary" of any person shall mean any
Consolidated Subsidiary of such person all the shares of common stock
and other voting capital stock or other voting ownership interests
having ordinary voting power to vote in the election of the board of
directors or other governing body performing similar functions (except
directors' qualifying shares) of which are at the time directly or
indirectly owned by such person.
"Withdrawal Liability" shall mean liability of the Borrower
established under Section 4201 of ERISA as a result of a complete or
partial withdrawal from a Multiemployer Plan, as such terms are defined
in Part I of Subtitle E of Title IV of ERISA.
SECTION 1.02. Terms Generally.
The definitions in Section 1.01 shall apply equally to both the
singular and plural forms of the terms defined. Whenever the context may
require, any pronoun shall include the corresponding masculine, feminine and
neuter forms. The words "include", "includes" and "including" shall be deemed to
be followed by the phrase "without limitation". All references herein to
Articles, Sections, Exhibits and Schedules shall be deemed references to
Articles and Sections of, and Exhibits and Schedules to, this Agreement unless
the context shall otherwise require. Except as otherwise expressly provided
herein, all terms of an accounting or financial nature shall be construed in
accordance with GAAP, as in effect from time to time; provided, however, that
for purposes of determining compliance with any covenant set forth in Article V,
such terms shall be construed in accordance with GAAP as in effect on the date
hereof applied on a basis consistent with the application used in preparing the
Borrower's audited financial statements referred to in Section 3.05.
15
ARTICLE II
THE CREDITS
SECTION 2.01. Commitments.
Subject to the terms and conditions and relying upon the
representations and warranties herein set forth, each Lender agrees, severally
and not jointly, to make Loans, at any time and from time to time until the
earlier of the Maturity Date and the termination of the Commitment of such
Lender, to the Borrower in an aggregate principal amount at any time outstanding
not to exceed such Lender's Commitment, subject, however, to the conditions that
(i) at no time shall the outstanding aggregate principal amount of all Loans
exceed the Total Commitment, (ii) at no time shall the outstanding aggregate
principal amount of all Loans made by any Lender exceed the amount of such
Lender's Commitment and (iii) at all times, the outstanding aggregate principal
amount of all Loans made by each Lender to the Borrower shall equal the product
of (A) the percentage which such Lender's Commitment represents of the Total
Commitment times (B) the outstanding aggregate principal amount of all Loans
made to the Borrower.
Within the foregoing limits, the Borrower may borrow, pay or prepay and
reborrow Loans hereunder, on and after the date of this Agreement and prior to
the Maturity Date, subject to the terms, conditions and limitations set forth
herein.
SECTION 2.02. Loans.
(a) Each Loan shall be made as part of a Borrowing consisting of
Loans made by the Lenders ratably in accordance with their respective
Commitments; provided, however, that the failure of any Lender to make any Loan
shall not in itself relieve any other Lender of its obligation to lend hereunder
(it being understood, however, that no Lender shall be responsible for the
failure of any other Lender to make any Loan required to be made by such other
Lender). The Loans comprising any Borrowing shall be in an aggregate principal
amount that is an integral multiple of $5,000,000 and not less than $10,000,000
(or an aggregate principal amount equal to the remaining balance of the
available Commitments).
(b) Each Borrowing shall be comprised entirely of Eurodollar Loans or
ABR Loans, as the Borrower may request pursuant to Section 2.03. Each Lender may
at its option make any Eurodollar Loan by causing any domestic or foreign branch
or Affiliate of such Lender to make such Loan; provided that any exercise of
such option shall not affect the obligation of the Borrower to repay such Loan
in accordance with the terms of this Agreement. Borrowings of more than one Type
may be outstanding at the same time.
(c) Subject to paragraph (d) below, each Lender shall make each Loan
to be made by it hereunder on the proposed date thereof by wire transfer of
immediately available funds to the Agent in New York, New York, not later than
noon, New York City time, and the Agent shall by 2:00 p.m., New York City time,
credit the amounts so received to the account or accounts specified from time to
time in one or more notices delivered by the Borrower to the Agent or, if a
Borrowing shall not occur on such date because any condition precedent herein
specified shall not have been met, return the amounts so received to the
respective Lenders. Loans shall be made by the Lenders pro rata in accordance
with Section 2.13. Unless the Agent shall have
16
received notice from a Lender prior to the date of any Borrowing that such
Lender will not make available to the Agent such Lender's portion of such
Borrowing, the Agent may assume that such Lender has made such portion available
to the Agent on the date of such Borrowing in accordance with this paragraph (c)
and the Agent may, in reliance upon such assumption, make available to the
Borrower on such date a corresponding amount. If and to the extent that such
Lender shall not have made such portion available to the Agent, such Lender and
the Borrower (without waiving any claim against such Lender for such Lender's
failure to make such portion available) severally agree to repay to the Agent
forthwith on demand such corresponding amount together with interest thereon,
for each day from the date such amount is made available to the Borrower until
the date such amount is repaid to the Agent, at (i) in the case of the Borrower,
the interest rate applicable at the time to the Loans comprising such Borrowing
and (ii) in the case of such Lender, the Federal Funds Effective Rate. If such
Lender shall repay to the Agent such corresponding amount, such amount shall
constitute such Lender's Loan as part of such Borrowing for purposes of this
Agreement.
(d) The Borrower may refinance all or any part of any Borrowing with
a Borrowing of the same or a different Type, subject to the conditions and
limitations set forth in this Agreement. Any Borrowing or part thereof so
refinanced shall be deemed to be repaid or prepaid in accordance with Section
2.05 or 2.10, as applicable, with the proceeds of a new Borrowing, and the
proceeds of the new Borrowing, to the extent they do not exceed the principal
amount of the Borrowing being refinanced, shall not be paid by the Lenders to
the Agent or by the Agent to the Borrower pursuant to paragraph (c) above.
SECTION 2.03. Borrowing Procedure.
In order to request a Borrowing, the Borrower shall hand deliver or
telecopy to the Agent a duly completed Borrowing Request in the form of Exhibit
A (i) in the case of a Eurodollar Borrowing, not later than 11:00 a.m., New York
City time, three Business Days before such Borrowing, and (ii) in the case of an
ABR Borrowing, not later than 11:00 a.m., New York City time, one Business Day
before such Borrowing. Such notice shall be irrevocable and shall in each case
specify (A) whether the Borrowing then being requested is to be a Eurodollar
Borrowing or an ABR Borrowing; (B) the date of such Borrowing (which shall be a
Business Day) and the amount thereof; and (C) if such Borrowing is to be a
Eurodollar Borrowing, the Interest Period with respect thereto, which shall not
end after the Maturity Date. If no election as to the Type of Borrowing is
specified in any such notice, then the requested Borrowing shall be an ABR
Borrowing. If no Interest Period with respect to any Eurodollar Borrowing is
specified in any such notice, then the Borrower shall be deemed to have selected
an Interest Period of one month's duration (subject to the limitations set forth
in the definition of "Interest Period"). If the Borrower shall not have given
notice in accordance with this Section 2.03 of its election to refinance a
Borrowing prior to the end of the Interest Period in effect for such Borrowing,
then the Borrower shall (unless such Borrowing is repaid at the end of such
Interest Period) be deemed to have given notice of an election to refinance such
Borrowing with an ABR Borrowing. Notwithstanding any other provision of this
Agreement to the contrary, no Borrowing shall be requested if the Interest
Period with respect thereto would end after the scheduled Maturity Date. The
Agent shall promptly advise the Lenders of any notice given pursuant to this
Section 2.03 and of each Lender's portion of the requested Borrowing.
17
SECTION 2.04. Fees.
(a) The Borrower agrees to pay to each Lender, through the Agent, on
each March 31, June 30, September 30 and December 31 (with the first payment
being due on June 30, 2002) and on each date on which the Commitment of such
Lender shall be terminated or reduced as provided herein, a commitment fee (a
"Commitment Fee"), at a rate per annum equal to the applicable Commitment Fee
Percentage from time to time in effect on the amount of the sum of the unused
Commitment of such Lender, during the preceding quarter (or other period
commencing on the date of this Agreement or ending on the Maturity Date or any
date on which the Commitment of such Lender shall be terminated). All Commitment
Fees shall be computed on the basis of the actual number of days elapsed in a
year of 360 days. The Commitment Fee due to each Lender shall commence to accrue
on the date of this Agreement, and shall cease to accrue on the date of
termination of the Commitment of such Lender as provided herein.
(b) The Borrower agrees to pay the Agent, for its own account, the
administrative fees in the amounts and at the times provided for in the Letter
Agreement (the "Administrative Fees").
(c) All Fees shall be paid on the dates due, in immediately available
funds, to the Agent for distribution, if and as appropriate, among the Lenders.
Once paid, none of the Fees shall be refundable under any circumstances.
SECTION 2.05. Repayment of Loans; Evidence of Indebtedness.
(a) The outstanding principal balance of each Loan shall be due and
payable on the last day of the Interest Period applicable thereto and on the
Maturity Date.
(b) Each Lender shall maintain in accordance with its usual practice
an account or accounts evidencing the indebtedness to such Lender resulting from
each Loan made by such Lender from time to time, including the amounts of
principal and interest payable and paid to such Lender from time to time under
this Agreement.
(c) The Agent shall maintain accounts in which it will record (i) the
amount of each Loan made hereunder, the Type of each Loan made 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 Agent hereunder from the
Borrower and each Lender's share thereof.
(d) The entries made in the accounts maintained pursuant to
paragraphs (b) and (c) of this Section 2.05 shall, to the extent permitted by
applicable law, be prima facie evidence of the existence and amounts of the
obligations therein recorded; provided, however, that the failure of any Lender
or the Agent to maintain such accounts or any error therein shall not in any
manner affect the obligations of the Borrower to repay the Loans in accordance
with their terms.
SECTION 2.06. Interest on Loans.
(a) Subject to the provisions of Section 2.07, the Loans comprising
each Eurodollar Borrowing shall bear interest (computed on the basis of the
actual number of days elapsed over a
18
year of 360 days) at a rate per annum equal to the LIBO Rate for the Interest
Period in effect for such Borrowing plus the Applicable Margin from time to time
in effect.
(b) Subject to the provisions of Section 2.07, the Loans comprising
each ABR Borrowing shall bear interest (computed on the basis of the actual
number of days elapsed over a year of (i) 365 or 366 days, as the case may be,
for periods during which the Alternate Base Rate is determined by reference to
the Prime Rate and (ii) 360 days for other periods) at a rate per annum equal to
the Alternate Base Rate plus the Applicable Margin from time to time in effect.
(c) Interest on each Loan shall be payable on each Interest Payment
Date applicable to such Loan except as otherwise provided in this Agreement. The
applicable LIBO Rate or Alternate Base Rate for each Interest Period or day
within an Interest Period, as the case may be, shall be determined by the Agent,
and such determination shall be conclusive absent manifest error; provided that
the Agent shall, upon request, provide to the Borrower a certificate setting
forth in reasonable detail the basis for such determination.
SECTION 2.07. Default Interest.
If the Borrower shall default in the payment of the principal of or
interest on any Loan or any other amount becoming due hereunder, whether by
scheduled maturity, notice of prepayment, acceleration or otherwise, the
Borrower shall on demand from time to time from the Agent pay interest, to the
extent permitted by law, on such defaulted amount up to (but not including) the
date of actual payment (after as well as before judgment) at a rate per annum
(computed as provided in Section 2.06(b)) equal to the Alternate Base Rate plus
the Applicable Margin for ABR Loans plus 2%.
SECTION 2.08. Alternate Rate of Interest.
In the event, and on each occasion, that on the day two Business Days
prior to the commencement of any Interest Period for a Eurodollar Borrowing the
Agent shall have determined (i) that dollar deposits in the principal amounts of
the Eurodollar Loans comprising such Borrowing are not generally available in
the London interbank market or (ii) that reasonable means do not exist for
ascertaining the LIBO Rate, the Agent shall, as soon as practicable thereafter,
give telecopy notice of such determination to the Borrower and the Lenders. In
the event of any such determination under clause (i) or (ii) above, until the
Agent shall have advised the Borrower and the Lenders that the circumstances
giving rise to such notice no longer exist any request by the Borrower for a
Eurodollar Borrowing pursuant to Section 2.03 shall be deemed to be a request
for an ABR Borrowing. In the event the Required Lenders notify the Agent that
the rates at which dollar deposits are being offered will not adequately and
fairly reflect the cost to such Lenders of making or maintaining Eurodollar
Loans during such Interest Period, the Agent shall notify the Borrower of such
notice and until the Required Lenders shall have advised the Agent that the
circumstances giving rise to such notice no longer exist, any request by the
Borrower for a Eurodollar Borrowing shall be deemed a request for an ABR
Borrowing. Each determination by the Agent hereunder shall be made in good faith
and shall be conclusive absent manifest error; provided that the Agent, shall,
upon request, provide to the Borrower a certificate setting forth in reasonable
detail the basis for such determination.
19
SECTION 2.09. Termination and Reduction of Commitments.
(a) The Commitments shall be automatically terminated on the Maturity
Date.
(b) Upon at least two Business Days' prior irrevocable written notice
to the Agent, the Borrower may at any time in whole permanently terminate, or
from time to time in part permanently reduce, the Total Commitment; provided,
however, that (i) each partial reduction of the Total Commitment shall be in an
integral multiple of $10,000,000 and (ii) no such termination or reduction shall
be made that would reduce the Total Commitment to an amount less than (1) the
aggregate principal amount of outstanding Loans on the date of such termination
or reduction (after giving effect to any prepayment made pursuant to Section
2.10) or (2) $50,000,000, unless the result of such termination or reduction
referred to in this clause (2) is to reduce the Total Commitment to $0. The
Agent shall advise the Lenders of any notice given pursuant to this Section
2.09(b) and of each Lender's portion of any such termination or reduction of the
Total Commitment.
(c) Each reduction in the Total Commitment hereunder shall be made
ratably among the Lenders in accordance with their respective Commitments. The
Borrower shall pay to the Agent for the account of the Lenders, on the date of
each termination or reduction of the Total Commitment, the Commitment Fees on
the amount of the Commitments so terminated or reduced accrued through the date
of such termination or reduction.
SECTION 2.10. Prepayment.
(a) The Borrower shall have the right at any time and from time to
time to prepay any Borrowing, in whole or in part, upon giving telecopy notice
(or telephone notice promptly confirmed by telecopy) to the Agent: (i) before
11:00 a.m., New York City time, three Business Days prior to prepayment, in the
case of Eurodollar Loans, and (ii) before 11:00 a.m., New York City time, one
Business Day prior to prepayment, in the case of ABR Loans; provided, however,
that each partial prepayment shall be in an amount which is an integral multiple
of $5,000,000 and not less than $10,000,000.
(b) Each notice of prepayment shall specify the prepayment date and
the principal amount of each Borrowing (or portion thereof) to be prepaid, shall
be irrevocable and shall commit the Borrower to prepay such Borrowing (or
portion thereof) by the amount stated therein on the date stated therein. All
prepayments under this Section 2.10 shall be subject to Section 8.05 but
otherwise without premium or penalty. All prepayments under this Section 2.10
shall be accompanied by accrued interest on the principal amount being prepaid
to the date of payment.
SECTION 2.11. Reserve Requirements; Change in Circumstances.
(a) Notwithstanding any other provision herein, if after the date of
this Agreement any change in applicable law or regulation or in the
interpretation or administration thereof by any Governmental Authority charged
with the interpretation or administration thereof (whether or not having the
force of law) shall change the basis of taxation of payments to any Lender
hereunder (except for changes in respect of taxes on the overall net income of
such Lender or its lending office imposed by the jurisdiction in which such
Lender's principal executive office or
20
lending office is located), or shall result in the imposition, modification or
applicability of any reserve, special deposit or similar requirement against
assets of, deposits with or for the account of or credit extended by any Lender,
or shall result in the imposition on any Lender or the London interbank market
of any other condition affecting this Agreement, such Lender's Commitment or any
Eurodollar Loan made by such Lender, 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 to reduce the amount of any sum received or receivable by
such Lender hereunder (whether of principal, interest or otherwise) by an amount
deemed by such Lender to be material, then the Borrower shall, upon receipt of
the notice and certificate provided for in Section 2.11(c), promptly pay to such
Lender such additional amount or amounts as will compensate such Lender for such
additional costs incurred or reduction suffered.
(b) If any Lender shall have determined that the adoption of any law,
rule, regulation or guideline arising out of the July 1988 report of the Basle
Committee on Banking Regulations and Supervisory Practices entitled
"International Convergence of Capital Measurement and Capital Standards," or the
adoption after the date hereof of any other law, rule, regulation or guideline
regarding capital adequacy, or any change in any of the foregoing or in the
interpretation or administration of any of the foregoing by any Governmental
Authority, central bank or comparable agency charged with the interpretation or
administration thereof, or compliance by any Lender (or any lending office of
such Lender) or any Lender's holding company with any request or directive
regarding capital adequacy (whether or not having the force of law) of any such
authority, central bank or comparable agency, has or would have the effect of
reducing the rate of return on such Lender's capital or on the capital of such
Lender's holding company, if any, as a consequence of this Agreement, such
Lender's Commitment or the Loans made by such Lender pursuant hereto to a level
below that which such Lender or such Lender's holding company could have
achieved but for such adoption, change or compliance (taking into consideration
such Lender's policies and the policies of such Lender's holding company with
respect to capital adequacy) by an amount deemed by such Lender to be material,
then from time to time such additional amount or amounts as will compensate such
Lender for any such reduction suffered will be paid by the Borrower to such
Lender.
(c) A certificate of each Lender setting forth such amount or amounts
as shall be necessary to compensate such Lender or its holding company as
specified in paragraph (a) or (b) above, and containing an explanation, in
reasonable detail, of the manner in which such amount or amounts shall have been
determined, shall be delivered to the Borrower and shall be conclusive absent
manifest error. The Borrower shall pay each Lender the amount shown as due on
any such certificate delivered by it within 10 days after its receipt of the
same. Each Lender shall give prompt notice to the Borrower of any event of which
it has knowledge, occurring after the date hereof, that it has determined will
require compensation by the Borrower pursuant to this Section; provided,
however, that failure by such Lender to give such notice shall not constitute a
waiver of such Lender's right to demand compensation hereunder.
(d) Failure on the part of any Lender to demand compensation for any
increased costs or reduction in amounts received or receivable or reduction in
return on capital with respect to any period shall not constitute a waiver of
such Lender's right to demand compensation with respect to such period or any
other period; provided, however, that no Lender shall be entitled to
compensation under this Section 2.11 for any costs incurred or reductions
suffered with respect
21
to any date unless it shall have notified the Borrower that it will demand
compensation for such costs or reductions under paragraph (c) above not more
than 90 days after the later of (i) such date and (ii) the date on which it
shall have become aware of such costs or reductions. The protection of this
Section shall be available to each Lender regardless of any possible contention
of the invalidity or inapplicability of the law, rule, regulation, guideline or
other change or condition which shall have occurred or been imposed.
(e) Each Lender agrees that it will designate a different lending
office if such designation will avoid the need for, or reduce the amount of,
such compensation and will not, in the reasonable judgment of such Lender, be
disadvantageous to such Lender.
SECTION 2.12. Change in Legality.
(a) Notwithstanding any other provision herein, if any change in any
law or regulation or in the interpretation thereof by any Governmental Authority
charged with the administration or interpretation thereof shall make it unlawful
for any Lender to make or maintain any Eurodollar Loan or to give effect to its
obligations as contemplated hereby with respect to any Eurodollar Loan, then, by
written notice to the Borrower and to the Agent, such Lender may:
(i) declare that Eurodollar Loans will not thereafter be
made by such Lender hereunder, whereupon any request for a Eurodollar
Borrowing shall, as to such Lender only, be deemed a request for an
ABR Loan unless such declaration shall be subsequently withdrawn (any
Lender delivering such a declaration hereby agreeing to withdraw such
declaration promptly upon determining that such event of illegality no
longer exists); and
(ii) require that all outstanding Eurodollar Loans made by it
be converted to ABR Loans, in which event all such Eurodollar Loans
shall be automatically converted to ABR Loans as of the effective date
of such notice as provided in paragraph (b) below.
In the event any Lender shall exercise its rights under (i) or (ii) above, all
payments and prepayments of principal that would otherwise have been applied to
repay the Eurodollar Loans which would have been made by such Lender or the
converted Eurodollar Loans of such Lender shall instead be applied to repay the
ABR Loans made by such Lender in lieu of, or resulting from the conversion of,
such Eurodollar Loans.
(b) For purposes of this Section 2.12, a notice by any Lender shall
be effective as to each Eurodollar Loan, if lawful, on the last day of the
Interest Period currently applicable to such Eurodollar Loan; in all other cases
such notice shall be effective on the date of receipt.
SECTION 2.13. Pro Rata Treatment.
Except as required under Sections 2.12 and 2.17, each Borrowing, each
payment or prepayment of principal of any Borrowing, each payment of interest on
the Loans, each payment of the Commitment Fees, each reduction of the
Commitments and each refinancing or conversion of any Borrowing with a Borrowing
of any Type, shall be allocated pro rata among the Lenders in accordance with
their respective Commitments (or, if such Commitments shall have expired or been
terminated, in accordance with the respective principal amounts of their
22
outstanding Loans). Each Lender agrees that in computing such Lender's portion
of any Borrowing to be made hereunder, the Agent may, in its discretion, round
each Lender's percentage of such Borrowing to the next higher or lower whole
dollar amount.
SECTION 2.14. Sharing of Setoffs.
Each Lender agrees that if it shall, through the exercise of a right of
banker's lien, setoff or counterclaim, or pursuant to a secured claim under
Section 506 of Title 11 of the United States Bankruptcy Code or other security
or interest arising from, or in lieu of, such secured claim, received by such
Lender under any applicable bankruptcy, insolvency or other similar law or
otherwise, or by any other means, obtain payment (voluntary or involuntary) in
respect of any Loan or Loans as a result of which the unpaid principal portion
of its Loans shall be proportionately less than the unpaid principal portion of
the Loans of any other Lender, it shall be deemed simultaneously to have
purchased from such other Lender at face value, and shall promptly pay to such
other Lender the purchase price for, a participation in the Loans of such other
Lender, so that the aggregate unpaid principal amount of the Loans and
participations in the Loans held by each Lender shall be in the same proportion
to the aggregate unpaid principal amount of all Loans then outstanding as the
principal amount of its Loans prior to such exercise of banker's lien, setoff or
counterclaim or other event was to the principal amount of all Loans outstanding
prior to such exercise of banker's lien, setoff or counterclaim or other event;
provided, however, that, if any such purchase or purchases or adjustments shall
be made pursuant to this Section 2.14 and the payment giving rise thereto shall
thereafter be recovered, such purchase or purchases or adjustments shall be
rescinded to the extent of such recovery and the purchase price or prices or
adjustment restored without interest. The Borrower expressly consents to the
foregoing arrangements and agrees that any Lender holding a participation in a
Loan deemed to have been so purchased may exercise any and all rights of
banker's lien, setoff or counterclaim with respect to any and all moneys owing
by the Borrower to such Lender by reason thereof as fully as if such Lender had
made a Loan in the amount of such participation.
SECTION 2.15. Payments.
(a) The Borrower shall make each payment (including principal of or
interest on any Borrowing or any Fees or other amounts) hereunder from an
account in the United States not later than 12:00 noon, New York City time, on
the date when due in dollars to the Agent at its offices at Xxx Xxxxx Xxx, Xxxxx
000, Xxx Xxxxxx, Xxxxxxxx 00000, Attention: Medium Term Finance, Account:
3685-2248, in immediately available funds. Each such payment shall be made
without off-set, deduction or counterclaim, provided, that the foregoing shall
not constitute a relinquishment or waiver of the Borrower's rights to any
independent claim that the Borrower may have against the Agent or any Lender.
(b) Whenever any payment (including principal of or interest on any
Borrowing or any Fees or other amounts) hereunder shall become due, or otherwise
would occur, on a day that is not a Business Day, such payment may be made on
the next succeeding Business Day, and such extension of time shall in such case
be included in the computation of interest or Fees, if applicable.
23
SECTION 2.16. Taxes.
(a) Any and all payments of principal and interest on any Borrowings,
or of any Fees or indemnity or expense reimbursements by the Borrower hereunder
("Borrower Payments") shall be made, in accordance with Section 2.15, free and
clear of and without deduction for any and all current or future United States
Federal, state and local taxes, levies, imposts, deductions, charges or
withholdings, and all liabilities with respect to such Borrower Payments, but
only to the extent reasonably attributable to such Borrower Payments, excluding
(i) income taxes imposed on the net income of the Agent or any Lender (or any
transferee or assignee thereof, including a participation holder (any such
entity a "Transferee")) and (ii) franchise taxes imposed on the net income of
the Agent or any Lender (or Transferee), in each case by the jurisdiction under
the laws of which the Agent or such Lender (or Transferee) is organized or doing
business through offices or branches located therein, or any political
subdivision thereof (all such nonexcluded taxes, levies, imposts, deductions,
charges, withholdings and liabilities, collectively or individually, "Taxes").
If the Borrower shall be required to deduct any Taxes from or in respect of any
sum payable hereunder to any Lender (or any Transferee) or the Agent, (i) the
sum payable shall be increased by the amount (an "additional amount") necessary
so that after making all required deductions (including deductions applicable to
additional sums payable under this Section 2.16) such Lender (or Transferee) or
the Agent (as the case may be) shall receive an amount equal to the sum it would
have received had no such deductions been made, (ii) the Borrower shall make
such deductions and (iii) the Borrower shall pay the full amount deducted to the
relevant Governmental Authority in accordance with applicable law.
(b) In addition, the Borrower shall pay to the relevant United States
Governmental Authority in accordance with applicable law any current or future
stamp or documentary taxes or any other excise or property taxes, charges or
similar levies that arise from any payment made hereunder or from the execution,
delivery or registration of, or otherwise with respect to, this Agreement or the
Letter Agreement ("Other Taxes").
(c) The Borrower shall indemnify each Lender (or Transferee thereof)
and the Agent for the full amount of Taxes and Other Taxes with respect to
Borrower Payments paid by such Lender (or Transferee) or the Agent, as the case
may be, and any liability (including penalties, interest and expenses (including
reasonable attorney's fees and expenses)) arising therefrom or with respect
thereto, whether or not such Taxes or Other Taxes were correctly or legally
asserted by the relevant United States Governmental Authority. A certificate
setting forth and containing an explanation in reasonable detail of the manner
in which such amount shall have been determined and the amount of such payment
or liability prepared by a Lender, or the Agent on behalf of a Lender, absent
manifest error, shall be final, conclusive and binding for all purposes. Such
indemnification shall be made within 30 days after the date the Lender (or
Transferee) or the Agent, as the case may be, makes written demand therefor.
(d) If a Lender (or Transferee) or the Agent shall become aware that
it is entitled to claim a refund from a United States Governmental Authority in
respect of Taxes or Other Taxes as to which it has been indemnified by the
Borrower, or with respect to which the Borrower has paid additional amounts,
pursuant to this Section 2.16, it shall promptly notify the Borrower of the
availability of such refund claim and shall, within 30 days after receipt of a
request by the Borrower, make a claim to such United States Governmental
Authority for such refund at the
24
Borrower's expense. If a Lender (or Transferee) or the Agent receives a refund
(including pursuant to a claim for refund made pursuant to the preceding
sentence) in respect of any Taxes or Other Taxes as to which it has been
indemnified by the Borrower or with respect to which the Borrower had paid
additional amounts pursuant to this Section 2.16, it shall within 30 days from
the date of such receipt pay over such refund to the Borrower (but only to the
extent of indemnity payments made, or additional amounts paid, by the Borrower
under this Section 2.16 with respect to the Taxes or Other Taxes giving rise to
such refund), net of all out-of-pocket expenses of such Lender (or Transferee)
or the Agent and without interest (other than interest paid by the relevant
United States Governmental Authority with respect to such refund); provided,
however, that the Borrower, upon the request of such Lender (or Transferee) or
the Agent, agrees to repay the amount paid over to the Borrower (plus penalties,
interest or other charges) to such Lender (or Transferee) or the Agent in the
event such Lender (or Transferee) or the Agent is required to repay such refund
to such United States Governmental Authority.
(e) As soon as practicable, but in any event within 30 days, after
the date of any payment of Taxes or Other Taxes by the Borrower to the relevant
United States Governmental Authority, the Borrower will deliver to the Agent, at
its address referred to in Section 8.01, the original or a certified copy of a
receipt issued by such United States Governmental Authority evidencing payment
thereof.
(f) Without prejudice to the survival of any other agreement
contained herein, the agreements and obligations contained in this Section 2.16
shall survive the payment in full of the principal of and interest on all Loans
made hereunder.
(g) Each Lender (or Transferee) that is organized under the laws of a
jurisdiction other than the United States, any State thereof or the District of
Columbia (a "Non-U.S. Lender") shall deliver to the Borrower and the Agent two
copies of either United States Internal Revenue Service Form W-8BEN or Form
W-8ECI, properly completed and duly executed by such Non-U.S. Lender claiming
complete exemption from, or reduced rate of, United States Federal withholding
tax on payments by the Borrower under this Agreement. Such forms shall be
delivered by each Non-U.S. Lender on or before the date it becomes a party to
this Agreement (or, in the case of a Transferee that is a participation holder,
on or before the date such participation holder becomes a Transferee hereunder)
and on or before the date, if any, such Non-U.S. Lender changes its applicable
lending office by designating a different lending office (a "New Lending
Office"). In addition, each Non-U.S. Lender shall deliver such forms promptly
upon the obsolescence or invalidity of any form previously delivered by such
Non-U.S. Lender. Notwithstanding any other provision of this Section 2.16(g), a
Non-U.S. Lender shall not be required to deliver any form pursuant to this
Section 2.16(g) that such Non-U.S. Lender is not legally able to deliver.
(h) The Borrower shall not be required to indemnify any Non-U.S.
Lender (including any Transferee), or to pay any additional amounts to any
Non-U.S. Lender (including any Transferee), in respect of United States
Federal, state or local withholding tax pursuant to paragraph (a) or (c) above
to the extent that (i) the obligation to withhold amounts with respect to United
States Federal, state or local withholding tax existed on the date such Non-U.S.
Lender became a party to this Agreement (or, in the case of a Transferee that is
a participation holder, on the date such participation holder became a
Transferee hereunder) or, with respect to payments to
25
a New Lending Office, the date such Non-U.S. Lender designated such New Lending
Office with respect to a Loan; provided, however, that this clause (i) shall not
apply to any Transferee or New Lending Office that becomes a Transferee or New
Lending Office as a result of an assignment, participation, transfer or
designation made at the request of the Borrower; and provided further, however,
that this clause (i) shall not apply to the extent the indemnity payment or
additional amounts any Transferee, or Lender (or Transferee) through a New
Lending Office, would be entitled to receive (without regard to this clause (i))
do not exceed the indemnity payment or additional amounts that the person making
the assignment, participation or transfer to such Transferee, or Lender (or
Transferee) making the designation of such New Lending Office, would have been
entitled to receive in the absence of such assignment, participation, transfer
or designation or (ii) the obligation to pay such additional amounts or such
indemnity payments would not have arisen but for a failure by such Non-U.S.
Lender (including any Transferee) to comply with the provisions of paragraph (g)
above and (i) below.
(i) Any Lender (or Transferee) claiming any indemnity payment or
additional amounts payable pursuant to this Section 2.16 shall use reasonable
efforts (consistent with legal and regulatory restrictions) to file any
certificate or document reasonably requested in writing by the Borrower or to
change the jurisdiction of its applicable lending office if the making of such a
filing or change would avoid the need for or reduce the amount of any such
indemnity payment or additional amounts that may thereafter accrue and would
not, in the good faith determination of such Lender (or Transferee), be
otherwise disadvantageous to such Lender (or Transferee).
(j) Nothing contained in this Section 2.16 shall require any Lender
(or Transferee) or the Agent to make available to the Borrower any of its tax
returns (or any other information) that it deems to be confidential or
proprietary.
SECTION 2.17. Assignment of Commitments Under Certain Circumstances.
In the event that any Lender shall have delivered a notice or
certificate pursuant to Section 2.11 or 2.12, or the Borrower shall be required
to make additional payments to any Lender under Section 2.16, the Borrower shall
have the right, at its own expense, upon notice to such Lender and the Agent, to
require such Lender to transfer and assign without recourse (in accordance with
and subject to the restrictions contained in Section 8.04) all such Lender's
interests, rights and obligations contained hereunder to another financial
institution approved by the Agent and the Borrower (which approval shall not be
unreasonably withheld) which shall assume such obligations; provided that (i) no
such assignment shall conflict with any law, rule or regulation or order of any
Governmental Authority and (ii) the assignee shall pay to the affected Lender in
immediately available funds on the date of such assignment the principal of and
interest accrued to the date of payment on the Loans made by it hereunder and
all other amounts accrued for its account or owed to it hereunder and the
Borrower shall pay the processing and recordation fee due pursuant to Section
8.04.
ARTICLE III
REPRESENTATIONS AND WARRANTIES
The Borrower represents and warrants to each of the Lenders as follows:
26
SECTION 3.01. Organization; Powers.
The Borrower (i) is a corporation duly organized, validly existing and
in good standing under the laws of the jurisdiction of its organization, (ii)
has all requisite power and authority to own its property and assets and to
carry on its business as now conducted and as proposed to be conducted, (iii) is
qualified to do business in every jurisdiction where such qualification is
required, except where the failure so to qualify would not result in a Material
Adverse Change, and (iv) has the corporate power and authority to execute,
deliver and perform its obligations under this Agreement and to borrow
hereunder.
SECTION 3.02. Authorization.
The execution, delivery and performance by the Borrower of this
Agreement and the Borrowings hereunder (i) have been duly authorized by all
requisite corporate action and (ii) will not (A) violate (1) any provision of
any law, statute, rule or regulation (including, the Margin Regulations) or of
the certificate of incorporation or other constitutive documents or by-laws of
the Borrower or any of its Subsidiaries, (2) any order of any Governmental
Authority or (3) any provision of any indenture, agreement or other instrument
to which the Borrower or any of its Subsidiaries is a party or by which it or
any of its property is or may be bound, (B) be in conflict with, result in a
breach of or constitute (alone or with notice or lapse of time or both) a
default under any such indenture, agreement or other instrument or (C) result in
the creation or imposition of any Lien upon any property or assets of the
Borrower.
SECTION 3.03. Enforceability.
This Agreement constitutes a legal, valid and binding obligation of the
Borrower enforceable in accordance with its terms except to the extent that
enforcement may be limited by bankruptcy, insolvency or similar laws affecting
the enforcement of creditors' rights generally.
SECTION 3.04. Governmental Approvals.
No action, consent or approval of, registration or filing with or other
action by any Governmental Authority is or will be required in connection with
the execution, delivery and performance by the Borrower of this Agreement,
except those as have been duly obtained and as are (i) in full force and effect,
(ii) sufficient for their purpose and (iii) not subject to any pending or, to
the knowledge of the Borrower, threatened appeal or other proceeding seeking
reconsideration or review thereof.
SECTION 3.05. Financial Statements.
(a) The consolidated balance sheet of the Borrower and its
Consolidated Subsidiaries as of December 31, 2001 and the related consolidated
statements of income, retained earnings and cash flows for the fiscal year then
ended, reported on by Deloitte & Touche LLP and set forth in the Borrower's 2001
Annual Report on Form 10-K, copies of which have been delivered to each of the
Lenders, present fairly, in all material respects, the consolidated financial
position of the Borrower and its Consolidated Subsidiaries as of such date and
their consolidated results of operations and cash flows for such period ending
on such date, in conformity with GAAP.
27
(b) Except as set forth in the financial statements or other reports
of the type referred to in Section 5.03 hereof and which have been delivered to
the Lenders on or prior to the date hereof, since December 31, 2001, there has
been no Material Adverse Change, other than as a result of the matters excluded
from the computation of Consolidated Earnings Available for Fixed Charges as set
forth in the definition thereof.
SECTION 3.06. Litigation.
Except as set forth in the financial statements or other reports of the
type referred to in Section 5.03 hereof, which have been delivered to the
Lenders on or prior to the date hereof, there is no action, suit or proceeding
pending against, or to the knowledge of the Borrower threatened against or
affecting, the Borrower or any of its Subsidiaries before any court or
arbitrator or any governmental body, agency or official in which there is a
reasonable possibility of an adverse decision that could materially adversely
affect the ability of the Borrower to pay its obligations hereunder or that in
any manner draws into question the validity of this Agreement.
SECTION 3.07. Federal Reserve Regulations.
(a) Neither the Borrower nor any of its Subsidiaries is engaged
principally, or as one of its important activities, in the business of extending
credit for the purpose of purchasing or carrying Margin Stock.
(b) No part of the proceeds of any Loan will be used by the Borrower,
whether directly or indirectly, and whether immediately, incidentally or
ultimately, to purchase or carry Margin Stock or to refund indebtedness
originally incurred for such purpose, or for any other purpose which entails a
violation of, or which is inconsistent with, the provisions of the Margin
Regulations.
(c) Not more than 25% of the value of the assets of the Borrower
subject to the restrictions of Sections 5.09 and 5.10 are represented by Margin
Stock.
SECTION 3.08. Investment Company Act; Public Utility Holding Company
Act.
(a) Neither the Borrower nor any of its Subsidiaries is an
"investment company" as defined in, or subject to regulation under, the
Investment Company Act of 1940.
(b) The Borrower and each of its Subsidiaries is exempt from all
provisions of the Public Utility Holding Company Act of 1935 and rules and
regulations thereunder, except for Sections 9(a)(2) and 33 of such Act and the
rules and regulations thereunder, and the execution and delivery by the Borrower
of this Agreement and the performance of its obligations hereunder do not
violate any provision of such Act or any rule or regulation thereunder.
SECTION 3.09. No Material Misstatements.
No report, financial statement or other written information furnished
by or on behalf of the Borrower to the Agent or any Lender pursuant to or in
connection with this Agreement contains or will contain any material
misstatement of fact or omits or will omit to state any
28
material fact necessary to make the statements therein, in the light of the
circumstances under which they were or will be made, not misleading.
SECTION 3.10. Taxes.
The Borrower and its Subsidiaries have filed or caused to be filed
within 3 days of the date on which due, all material Federal, state and local
tax returns which to their knowledge are required to be filed by them, and have
paid or caused to be paid all material taxes shown to be due and payable on such
returns or on any assessments received by them, other than any taxes or
assessments the validity of which is being contested in good faith by
appropriate proceedings and with respect to which appropriate accounting
reserves have to the extent required by GAAP been set aside.
SECTION 3.11. Employee Benefit Plans.
With respect to each Plan the Borrower and its ERISA Affiliates are in
compliance in all material respects with the applicable provisions of ERISA and
the Code and the final regulations and published interpretations thereunder. No
ERISA Event has occurred that alone or together with any other ERISA Event has
resulted or could reasonably be expected to result in a Material Adverse Change.
Neither the Borrower nor any ERISA Affiliate has incurred any Withdrawal
Liability that could result in a Material Adverse Change. Neither the Borrower
nor any ERISA Affiliate has received any notification that any Multiemployer
Plan is in reorganization or has been terminated within the meaning of Title IV
of ERISA, which such reorganization or termination could result in a Material
Adverse Change, and no Multiemployer Plan is reasonably expected to be in
reorganization or to be terminated where such reorganization or termination has
resulted or can reasonably be expected to result, through an increase in the
contributions required to be made to such Plan or otherwise, in a Material
Adverse Change.
SECTION 3.12. Significant Subsidiaries.
Each of the Borrower's Significant Subsidiaries is a corporation,
limited liability company or other type of person duly incorporated or formed
(as the case may be), validly existing and in good standing under the laws of
its jurisdiction of incorporation or formation (as the case may be) and has all
corporate, limited liability company, partnership or other powers necessary to
carry on its business substantially as now conducted. The Borrower's Significant
Subsidiaries have all material governmental licenses, authorizations, consents
and approvals required to carry on the business of the Significant Subsidiaries
substantially as now conducted.
SECTION 3.13. Environmental Matters.
Except as set forth in or contemplated by the financial statements or
other reports of the type referred to in Section 5.03 hereof and which have been
delivered to the Lenders on or prior to the date hereof, the Borrower and each
of its Subsidiaries has complied in all material respects with all Federal,
state, local and other statutes, ordinances, orders, judgments, rulings and
regulations relating to environmental pollution or to environmental or nuclear
regulation or control, except to the extent that failure to so comply could not
reasonably be expected to result in a Material Adverse Change. Except as set
forth in or contemplated by such financial statements or other reports, neither
the Borrower nor any of its Subsidiaries has received notice
29
of any failure so to comply, except where such failure could not reasonably be
expected to result in a Material Adverse Change. Except as set forth in or
contemplated by such financial statements or other reports, the facilities of
the Borrower or any of its Subsidiaries, as the case may be, are not used to
manage any hazardous wastes, hazardous substances, hazardous materials, toxic
substances, toxic pollutants or substances similarly denominated, as those terms
or similar terms are used in the Resource Conservation and Recovery Act, the
Comprehensive Environmental Response Compensation and Liability Act, the
Hazardous Materials Transportation Act, the Toxic Substance Control Act, the
Clean Air Act, the Clean Water Act or any other applicable law relating to
environmental pollution, or any nuclear fuel or other radioactive materials, in
violation in any material respect of any law or any regulations promulgated
pursuant thereto, except to the extent that such violations could not reasonably
be expected to result in a Material Adverse Change. Except as set forth in or
contemplated by such financial statements or other reports, the Borrower is
aware of no events, conditions or circumstances involving environmental
pollution or contamination that could reasonably be expected to result in a
Material Adverse Change.
SECTION 3.14. Solvency.
The Borrower is Solvent.
ARTICLE IV
CONDITIONS
The obligations of the Lenders to make Loans hereunder are subject to
the satisfaction of the following conditions:
SECTION 4.01. Conditions to Initial Loan:
The Commitment of each Lender to make its initial Loan on or after the
date hereof is subject to the conditions that, on or prior to the date of such
Loan:
(a) The Agent shall have received evidence satisfactory to it that
the commitments of the lenders under the 2001 Agreement have been terminated and
that all fees, accrued interest and other amounts outstanding under the 2001
Agreement have been paid, repaid or prepaid (as appropriate), or will be paid,
repaid or prepaid (as appropriate), on the date of the first Borrowing hereunder
with the proceeds of Loans.
(b) The Agent shall have received favorable written legal opinions
of (i) (A) Xxxxxx Xxxx & Priest LLP, special New York counsel to the Borrower,
and (B) Hunton & Xxxxxxxx, counsel to the Borrower, and (ii) King & Spalding,
special New York counsel to the Agent, in each case dated the date hereof,
addressed to the Agent and the Lenders and in form and substance satisfactory to
the Agent.
(c) The Agent shall have received (i) a copy of the certificate of
incorporation, including all amendments thereto, of the Borrower, certified as
of a recent date by the Secretary of State of the State of Texas, and a
certificate as to the good standing of the Borrower as of a recent date from
such Secretary of State; (ii) a certificate of the Secretary or an Assistant
30
Secretary of the Borrower certifying (A) that attached thereto is a true and
complete copy of the bylaws of the Borrower as in effect on the date hereof and
at all times since a date prior to the date of the resolutions described in
clause (B) below, (B) that attached thereto are true and complete copies of
resolutions duly adopted by the Board of Directors authorizing the execution and
delivery by the Borrower of this Agreement, the Borrowings to be made by the
Borrower hereunder and the performance by the Borrower of all of its obligations
hereunder, and that such resolutions have not been modified, rescinded or
amended and are in full force and effect, (C) that the certificate of
incorporation referred to in clause (i) above has not been amended since the
date of the last amendment thereto shown on the certificate of good standing
furnished pursuant to such clause (i) and (D) as to the incumbency and specimen
signature of each officer executing this Agreement and any other document
delivered in connection herewith on behalf of the Borrower; (iii) a certificate
of another officer of the Borrower as to the incumbency and specimen signature
of the Secretary or Assistant Secretary executing the certificate pursuant to
(ii) above; and (iv) a certificate of a Responsible Officer of the Borrower
stating that (A) no action, consent or approval of, registration or filing with
or other action by any Governmental Authority is or will be required in
connection with the execution, delivery and performance by the Borrower of this
Agreement, except those as have been duly obtained and as are (1) in full force
and effect, (2) sufficient for their purpose and (3) not subject to any pending
or, to the knowledge of such person, threatened appeal or other proceeding
seeking reconsideration or review thereof, (B) the representations and
warranties set forth in Article III hereof are true and correct in all material
respects on and as of the date hereof, and (C) no Event of Default or Default
has occurred and is continuing on the date hereof.
(d) The Lenders, the Agent and the Joint Lead Arrangers shall have
received payment of all fees and reimbursement of all expenses for which
invoices have been presented as and when due on or prior to the date of the
initial Borrowing pursuant to the terms of this Agreement or the Letter
Agreement.
(e) The Agent shall have received such other approvals, opinions,
certificates, instruments and documents as the Agent or any of the Lenders may
have reasonably requested, in form satisfactory to the Agent, the Joint Lead
Arrangers and the requesting Lender (if applicable).
SECTION 4.02. Conditions for All Loans.
The Commitment of each Lender to make each Loan to be made by it in
connection with any Borrowing (including the initial Borrowing) shall be subject
to the satisfaction of the following conditions precedent on the date of such
Borrowing:
(a) The Agent shall have received a notice of such Borrowing as
required by Section 2.03.
(b) The representations and warranties set forth in Article III
hereof (except in the case of a refinancing of a Borrowing with a new Borrowing
that does not increase the aggregate principal amount of the Loans of any Lender
outstanding, the representations set forth in Sections 3.05(b), 3.06, 3.11 and
3.13) shall be true and correct in all material respects on and as
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of the date of such Borrowing with the same effect as though made on and as of
such date, except to the extent such representations and warranties expressly
relate to an earlier date.
(c) At the time of and immediately after such Borrowing, no Event
of Default or Default shall have occurred and be continuing.
(d) The Agent shall have received a certificate of a Responsible
Officer of the Borrower certifying that the matters set forth in subsections (b)
and (c) of this Section 4.02 are true and correct as of such date.
Each such Loan shall be deemed to constitute a representation and warranty by
the Borrower on the date of such Borrowing as to the matters specified in
subsections (b) and (c) of this Section 4.02.
ARTICLE V
COVENANTS
The Borrower agrees that, so long as any Lender has any Commitment
hereunder or any amount payable hereunder remains unpaid:
SECTION 5.01. Existence.
It will, and will cause each of its Significant Subsidiaries to, do or
cause to be done all things necessary to preserve and keep in full force and
effect its existence and all rights, licenses, permits, franchises and
authorizations necessary or desirable in the normal conduct of its business
except as otherwise permitted pursuant to Section 5.09.
SECTION 5.02. Compliance With Laws; Business and Properties.
It will, and will cause each of its Subsidiaries to, comply with all
applicable material laws, rules, regulations and orders of any Governmental
Authority, whether now in effect or hereafter enacted, except where the validity
or applicability of such laws, rules, regulations or orders is being contested
by appropriate proceedings in good faith; and at all times maintain and preserve
all property material to the conduct of its business and keep such property in
good repair, working order and condition and from time to time make, or cause to
be made, all needful and proper repairs, renewals, additions, improvements and
replacements thereto necessary in order that the business carried on in
connection therewith may be properly conducted at all times.
SECTION 5.03. Financial Statements, Reports, Etc.
It will furnish to the Agent and each Lender:
(a) as soon as available, and in any event within 120 days after
the end of each fiscal year of the Borrower, a consolidated balance sheet of the
Borrower and its Consolidated Subsidiaries as of the end of such fiscal year and
the related consolidated statements of income, retained earnings and cash flows
for such fiscal year, setting forth in each case in comparative form the figures
for the previous fiscal year, all reported on in a manner reasonably acceptable
to
32
the SEC by Deloitte & Touche LLP or other independent public accountants of
nationally recognized standing;
(b) as soon as available, and in any event within 60 days after
the end of each of the first three quarters of each fiscal year of the Borrower,
a consolidated balance sheet of the Borrower and its Consolidated Subsidiaries
as of the end of such quarter and the related consolidated statements of income
for such quarter, for the portion of the Borrower's fiscal year ended at the end
of such quarter, and for the twelve months ended at the end of such quarter, and
the related consolidated statement of cash flows for the portion of the
Borrower's fiscal year ended at the end of such quarter, setting forth
comparative figures for previous dates and periods to the extent required in
Form 10-Q, all certified (subject to normal year-end adjustments) as to fairness
of presentation, GAAP and consistency by a Financial Officer of the Borrower;
(c) simultaneously with any delivery of each set of financial
statements referred to in paragraphs (a) and (b) above, (i) an unconsolidated
balance sheet of the Borrower and the related unconsolidated statements of
income, retained earnings and cash flows as of the same date and for the same
periods applicable to the statements delivered pursuant to paragraph (a) or (b)
above, as applicable, all certified (subject to normal year-end adjustments in
the case of quarterly statements) as to fairness of presentation, GAAP and
consistency by a Financial Officer of the Borrower and (ii) a certificate of a
Financial Officer of the Borrower (A) setting forth in reasonable detail the
calculations required to establish whether the Borrower was in compliance with
the requirements of Sections 5.11 and 5.12 on the date of such financial
statements, and (B) stating whether any Default or Event of Default exists on
the date of such certificate and, if any Default or Event of Default then
exists, setting forth the details thereof and the action which the Borrower is
taking or proposes to take with respect thereto;
(d) simultaneously with the delivery of each set of financial
statements referred to in paragraph (a) above, a statement of the firm of
independent public accountants that reported on such statements (i) stating
whether anything has come to their attention to cause them to believe that any
Default or Event of Default existed on the date of such statements and (ii)
confirming the calculations set forth in the Financial Officer's certificate
delivered simultaneously therewith pursuant to paragraph (c) above;
(e) forthwith upon becoming aware of the occurrence of any Default
or Event of Default, a certificate of a Financial Officer of the Borrower
setting forth the details thereof and the action which the Borrower is taking or
proposes to take with respect thereto;
(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 the filing thereof, copies of each final
prospectus (other than a prospectus included in any registration statement on
Form S-8 or its equivalent or with respect to a dividend reinvestment plan) and
all reports on Forms 10-K, 10-Q and 8-K and similar reports that the Borrower
shall have filed with the SEC, or any Governmental Authority succeeding to any
of or all the functions of the SEC;
33
(h) if and when any member of the Controlled Group (i) gives or is
required to give notice to the PBGC of any Reportable Event with respect to any
Plan which might constitute grounds for a termination of such Plan under Title
IV of ERISA, or knows that the plan administrator of any Plan has given or is
required to give notice of any such Reportable Event, a copy of the notice of
such Reportable Event given or required to be given to the PBGC; (ii) receives
notice from a proper representative of a Multiemployer Plan of complete or
partial Withdrawal Liability being imposed upon such member of the Controlled
Group under Title IV of ERISA, a copy of such notice; or (iii) receives notice
from the PBGC under Title IV of ERISA of an intent to terminate, or appoint a
trustee to administer, any Plan, a copy of such notice; and
(i) promptly, from time to time, such additional information
regarding the financial position or business of the Borrower and its
Subsidiaries as the Agent, at the request of any Lender, may reasonably request.
As promptly as practicable after delivering each set of financial statements as
required in paragraph (a) of this Section, the Borrower shall make available a
copy of the consolidating workpapers used by the Borrower in preparing such
consolidated statements to each Lender that shall have requested such
consolidating workpapers. Each Lender that receives such consolidating
workpapers shall hold them in confidence as required by Section 8.15; provided
that no Lender may disclose such consolidating workpapers to any other person
pursuant to clause (iv) of Section 8.15.
SECTION 5.04. Insurance.
It will, and will cause each of its Subsidiaries to, maintain such
insurance or self insurance, to such extent and against such risks, including
fire and other risks insured against by extended coverage, as is customary with
companies similarly situated and in the same or similar businesses.
SECTION 5.05. Taxes, Etc.
It will, and will cause each of its Subsidiaries to, pay and discharge
promptly when due all material taxes, assessments and governmental charges
imposed upon it or upon its income or profits or in respect of its property, as
well as all other material liabilities, in each case before the same shall
become delinquent or in default and before penalties accrue thereon, unless and
to the extent that the same are being contested in good faith by appropriate
proceedings and adequate reserves with respect thereto shall, to the extent
required by GAAP, have been set aside.
SECTION 5.06. Maintaining Records; Access to Properties and
Inspections.
It will, and will cause each of its Subsidiaries to, maintain financial
records in accordance with GAAP and, upon reasonable notice and at reasonable
times, permit authorized representatives designated by any Lender to visit and
inspect its properties and to discuss its affairs, finances and condition with
its officers.
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SECTION 5.07. Erisa.
It will, and will cause each of its Subsidiaries that are members of
the Controlled Group to, comply in all material respects with the applicable
provisions of ERISA and the Code except where any noncompliance, individually or
in the aggregate, would not result in a Material Adverse Change.
SECTION 5.08. Use of Proceeds.
It will not, and will not cause or permit any of its Subsidiaries to,
use the proceeds of the Loans for purposes other than to refinance the amounts
outstanding under the 2001 Agreement for working capital and other general
corporate purposes, including the refinancing of short-term borrowings used for
working capital and other general corporate purposes.
SECTION 5.09. Consolidations, Mergers, Sales and Acquisitions of
Assets and Investments in Subsidiaries.
It (i) will not, and will not permit any Significant Subsidiary to,
consolidate or merge with or into any person unless (A) in the case of any such
transaction involving the Borrower, the surviving person is the Borrower or
another person formed under the laws of a State of the United States of America
that assumes or is responsible, by operation of law, for all the obligations of
the Borrower hereunder and (B) in the case of any such transaction involving any
Significant Subsidiary, the survivor is the Borrower, such Significant
Subsidiary or a Wholly Owned Subsidiary of the Borrower (or a person which as a
result of such transaction becomes a Wholly Owned Subsidiary of the Borrower),
and (ii) will not, and will not permit any Significant Subsidiary to, make a
Significant Disposition to any person other than the Borrower or a Wholly Owned
Subsidiary of the Borrower (or a person which as a result of such transaction
becomes a Wholly Owned Subsidiary of the Borrower), provided that the Borrower
will not in any event permit any such consolidation, merger, sale, lease or
transfer if any Default or Event of Default shall have occurred and be
continuing at the time of or after giving effect to such transaction.
Notwithstanding the foregoing, (x) neither the Borrower nor any of its
Subsidiaries will engage to a Substantial extent in businesses other than those
currently conducted by them and other businesses reasonably related thereto, (y)
neither the Borrower nor any of its Subsidiaries will acquire any Subsidiary or
make any investment in any Subsidiary if, upon giving effect to such acquisition
or investment, as the case may be, the Borrower would not be in compliance with
the covenants set forth in Sections 5.11 and 5.12 and (z) nothing in this
Section shall prohibit any sales of assets permitted by Section 5.10(d).
SECTION 5.10. Limitations on Liens.
Neither the Borrower nor any Significant Subsidiary will create or
assume or permit to exist any Lien in respect of any property or assets of any
kind (real or personal, tangible or intangible) of the Borrower or any
Significant Subsidiary, or sell any such property or assets subject to an
understanding or agreement, contingent or otherwise, to repurchase such property
or assets, or sell, or permit any Significant Subsidiary to sell, any accounts
receivable; provided that the provisions of this Section shall not prevent or
restrict the creation, assumption or existence of:
35
(a) any Lien in respect of any such property or assets of any
Significant Subsidiary to secure indebtedness owing by it to the Borrower or any
Wholly Owned Subsidiary of the Borrower; or
(b) Liens (including capital leases) in respect of property
acquired by the Borrower or any Significant Subsidiary, to secure the purchase
price, or the cost of construction and development, of such property (or to
secure indebtedness incurred prior to, at the time of, or within 120 days after
the later of the acquisition of such property and the commencement of operation
of such property for the purpose of financing the acquisition, or the cost of
construction and development, of such property), or Liens existing on any such
property at the time of acquisition of such property by the Borrower or such
Significant Subsidiary, whether or not assumed, or any Lien in respect of
property of any person existing at the time such person becomes a Subsidiary of
the Borrower; or agreements to acquire any property or assets under conditional
sale agreements or other title retention agreements, or capital leases in
respect of any other property; provided, that
(A) the aggregate principal amount of Indebtedness
secured by all Liens in respect of any such property shall not
exceed the cost (as determined by the board of directors or
analogous governing body of the Borrower or such Significant
Subsidiary, as the case may be) of such property at the time
of acquisition thereof (or (x) in the case of property covered
by a capital lease, the fair market value, as so determined,
of such property at the time of such transaction, or (y) in
the case of a Lien in respect of property existing at the time
such person becomes a Subsidiary of the Borrower the fair
market value, as so determined of such property at such time),
and
(B) at the time of the acquisition of the property by
the Borrower or such Significant Subsidiary, or at the time
such person becomes a Subsidiary of the Borrower, as the case
may be, every such Lien shall apply and attach only to the
property originally subject thereto and fixed improvements
constructed thereon; or
(c) refundings or extensions of any Lien permitted in the
foregoing paragraph (b) for amounts not exceeding the principal amount of the
Indebtedness so refunded or extended or the fair market value (as determined by
the board of directors (or analogous governing body) of the Borrower or such
Significant Subsidiary, as the case may be) of the property theretofore subject
to such Lien, whichever shall be lower, in each case at the time of such
refunding or extension; provided, that such Lien shall apply only to the same
property theretofore subject to the same and fixed improvements constructed
thereon; or
(d) sales subject to understandings or agreements to repurchase;
provided that the aggregate sales price for all such sales (other than sales to
any governmental instrumentality in connection with such instrumentality's
issuance of indebtedness, including industrial development bonds and pollution
control bonds, on behalf of the Borrower or any Significant Subsidiary) made in
any one calendar year shall not exceed $50,000,000; or
36
(e) any production payment or similar interest which is
dischargeable solely out of natural gas, coal, lignite, oil or other mineral to
be produced from the property subject thereto and to be sold or delivered by the
Borrower or any Significant Subsidiary; or
(f) any Lien, including in connection with sale-leaseback
transactions, created or assumed by any Significant Subsidiary on natural gas,
coal, lignite, oil or other mineral properties or nuclear fuel owned or leased
by such Subsidiary, to secure loans to such Subsidiary in an aggregate amount
not to exceed $400,000,000; provided, that neither the Borrower nor any other
Subsidiary of the Borrower shall assume or guarantee such financings; or
(g) any Lien (whenever incurred) on assets owned by the Borrower
or any Subsidiary thereof as of April 24, 2002 and any fuel, operating and
maintenance or similar contract related thereto securing Indebtedness of the
Borrower or such Subsidiary in an aggregate amount not to exceed 10% of the
consolidated assets of the Borrower; or
(h) leases (other than capital leases) now or hereafter existing
and any renewals and extensions thereof under which the Borrower or any
Significant Subsidiary may acquire or dispose of any of its property, subject,
however, to the terms of Section 5.09; or
(i) any Lien created or to be created by the First Mortgage; or
(j) any Lien on the rights of TXU Mining or TXU Fuel existing
under their respective Operating Agreements; or
(k) pledges or sales by the Borrower or any of its Subsidiaries
(other than Holdings) of its accounts receivable including customers'
installment paper; or
(l) the pledge of current assets, in the ordinary course of
business, to secure current liabilities; or
(m) Permitted Encumbrances; or
(n) Permitted Security Interests (as such term is defined in the
U.K. Facility Agreements) created by any Significant Subsidiary subject to any
U.K. Facility Agreement; or
(o) the Liens in favor of the agent under the Facility B Credit
Agreement on funds in the "Cash Collateral Account" (under and as defined in the
Facility B Credit Agreement) and on such "Cash Collateral Account" to secure the
reimbursement obligations of the Borrower in respect of "Letters of Credit"
issued under, and as defined in, the Facility B Credit Agreement and comparable
Liens created to secure reimbursement obligations for letters of credit issued
for the account of the Borrower or any of its Subsidiaries; or
(p) any Lien incurred in connection with the issuance of Qualified
Transition Bonds.
37
SECTION 5.11. Fixed Charge Coverage.
The Borrower will not, as of the end of each quarter of each fiscal
year of the Borrower, permit Consolidated Earnings Available for Fixed Charges
for the twelve months then ended to be less than or equal to 150% of
Consolidated Fixed Charges for the twelve months then ended.
SECTION 5.12. Equity Capitalization Ratio.
The Borrower will not, as of the end of each quarter of each fiscal
year of the Borrower, permit Consolidated Shareholders' Equity to be less than
35% of Consolidated Total Capitalization.
SECTION 5.13. Restrictive Agreements.
The Borrower will not permit Energy or Oncor to enter into any
agreement restricting the ability of Energy or Oncor to make payments, directly
or indirectly, to its shareholders by way of dividends, advances, repayments of
loans or advances, reimbursements of management and other intercompany charges,
expenses and accruals or other returns on investments or any other agreement or
arrangement that restricts the ability of Energy or Oncor to make any payment,
directly or indirectly, to its shareholders, other than pursuant to the terms of
preferred stock or Equity-Credit Preferred Securities issued by Energy or Oncor
or any of their respective Subsidiaries, if the effect of such agreement is to
subject Energy or Oncor to restrictions on such payments greater than those to
which such Subsidiary is subject on the date of this Agreement. All such
agreements to which Energy or Oncor is a party on the date hereof are listed in
Schedule 5.13 hereto.
ARTICLE VI
EVENTS OF DEFAULT
In case of the happening of any of the following events (each an "Event
of Default"):
(a) any representation or warranty made or deemed made by the
Borrower in or in connection with the execution and delivery of this Agreement
or the Borrowings hereunder shall prove to have been false or misleading in any
material respect when so made, deemed made or furnished;
(b) default shall be made by the Borrower in the payment of any
principal of any Loan when and as the same shall become due and payable, whether
at the due date thereof or at a date fixed for prepayment thereof or by
acceleration thereof or otherwise;
(c) default shall be made by the Borrower in the payment of any
interest on any Loan or any Fee or any other amount (other than an amount
referred to in paragraph (b) above) due hereunder, when and as the same shall
become due and payable, and such default shall continue unremedied for a period
of five days;
(d) default shall be made by the Borrower in the due observance or
performance of any covenant, condition or agreement contained in Section 5.01,
5.11 or 5.12;
38
(e) default shall be made by the Borrower (i) in the due
observance or performance of any covenant, condition or agreement contained in
Section 5.09 and such default shall continue unremedied for a period of 5 days
or (ii) in the due observance or performance of any covenant, condition or
agreement contained herein (other than those specified in (b), (c), (d) or
(e)(i) above) or in the Letter Agreement and such default shall continue
unremedied for a period of 30 days after notice thereof from the Agent at the
request of any Lender to the Borrower;
(f) the Borrower or any Subsidiary thereof shall (i) fail to pay
any principal or interest, regardless of amount, due in respect of any
Indebtedness in a principal amount in excess of $50,000,000, when and as the
same shall become due and payable, subject to any applicable grace periods, or
(ii) fail to observe or perform any other term, covenant, condition or agreement
contained in any agreement or instrument evidencing or governing any such
Indebtedness if the effect of any failure referred to in this clause (ii) is to
cause, or to permit the holder or holders of such Indebtedness or a trustee on
its or their behalf to cause, such Indebtedness to become due prior to its
stated maturity;
(g) an involuntary proceeding shall be commenced or an involuntary
petition shall be filed in a court of competent jurisdiction seeking (i) relief
in respect of the Borrower or any Significant Subsidiary, or of a substantial
part of the property or assets of the Borrower or any Significant Subsidiary,
under Title 11 of the United States Bankruptcy Code, as now constituted or
hereafter amended, or any other Federal or state bankruptcy, insolvency,
receivership or similar law, (ii) the appointment of a receiver, trustee,
custodian, sequestrator, conservator or similar official for the Borrower or any
Significant Subsidiary or for a substantial part of the property or assets of
the Borrower or any Significant Subsidiary or (iii) the winding up or
liquidation of the Borrower or any Significant Subsidiary; and such proceeding
or petition shall continue undismissed for 60 days or an order or decree
approving or ordering any of the foregoing shall be entered;
(h) the Borrower or any Significant Subsidiary shall (i)
voluntarily commence any proceeding or file any petition seeking relief under
Title 11 of the United States Bankruptcy Code, as now constituted or hereafter
amended, or any other Federal or state bankruptcy, insolvency, receivership or
similar law, (ii) consent to the institution of, or fail to contest in a timely
and appropriate manner, any proceeding or the filing of any petition described
in (g) above, (iii) apply for or consent to the appointment of a receiver,
trustee, custodian, sequestrator, conservator or similar official for the
Borrower or any Significant Subsidiary or for a substantial part of the property
or assets of it or such Significant Subsidiary, (iv) file an answer admitting
the material allegations of a petition filed against it in any such proceeding,
(v) make a general assignment for the benefit of creditors, (vi) become unable,
admit in writing its inability or fail generally to pay its debts as they become
due or (vii) take any action for the purpose of effecting any of the foregoing;
(i) A Change in Control shall occur;
(j) one or more judgments or orders for the payment of money in an
aggregate amount in excess of $50,000,000 shall be rendered against the Borrower
or any Subsidiary thereof or any combination thereof and such judgment or order
shall remain undischarged or unstayed for a period of 30 days, or any action
shall be legally taken by a judgment creditor to
39
levy upon assets or properties of the Borrower or any Subsidiary to enforce any
such judgment or order;
(k) an ERISA Event or ERISA Events shall have occurred that
reasonably could be expected to result in a Material Adverse Change; or
(l) the Borrower shall cease to own, directly or indirectly, 100%
of the outstanding common stock of Holdings.
then, and in every such event, and at any time thereafter during the continuance
of such event, the Agent, at the request of the Required Lenders, shall, by
notice to the Borrower, take either or both of the following actions, at the
same or different times: (i) terminate forthwith the right of the Borrower to
borrow pursuant to the Commitments and (ii) declare the Loans of the Borrower
then outstanding to be forthwith due and payable in whole or in part, whereupon
the principal of the Loans so declared to be due and payable, together with
accrued interest thereon and any unpaid accrued Fees and all other liabilities
of the Borrower accrued hereunder, shall become forthwith due and payable,
without presentment, demand, protest or any other notice of any kind, all of
which are hereby expressly waived, anything contained herein to the contrary
notwithstanding; provided that in the case of any event described in paragraph
(g) or (h) above with respect to the Borrower, the Commitments of the Lenders
shall automatically terminate and the principal of the Loans then outstanding,
together with accrued interest thereon and any unpaid accrued Fees and all other
liabilities of the Borrower accrued hereunder shall automatically become due and
payable, without presentment, demand, protest or any other notice of any kind,
all of which are hereby expressly waived by the Borrower, anything contained
herein to the contrary notwithstanding.
ARTICLE VII
THE AGENT
In order to expedite the transactions contemplated by this Agreement,
Citibank is hereby appointed to act as Agent on behalf of the Lenders. Each of
the Lenders hereby irrevocably authorizes the Agent to take such actions on
behalf of such Lender and to exercise such powers as are specifically delegated
to the Agent by the terms and provisions hereof, together with such actions and
powers as are reasonably incidental thereto. The Agent is hereby expressly
authorized by the Lenders, without hereby limiting any implied authority, (i) to
receive on behalf of the Lenders all payments of principal of and interest on
the Loans and all other amounts due to the Lenders hereunder, and promptly to
distribute to each Lender its proper share of each payment so received; (ii) to
give notice on behalf of each of the Lenders to the Borrower of any Event of
Default of which the Agent has actual knowledge acquired in connection with its
agency hereunder; and (iii) to distribute to each Lender copies of all notices,
financial statements and other materials delivered by the Borrower pursuant to
this Agreement as received by the Agent.
None of the Agent or any of its directors, officers, employees or
agents shall be liable as such for any action taken or omitted by any of them
except for its or his or her own gross negligence or willful misconduct, or be
responsible for any statement, warranty or representation herein or the contents
of any document delivered in connection herewith, or be required to
40
ascertain or to make any inquiry concerning the performance or observance by the
Borrower of any of the terms, conditions, covenants or agreements contained in
this Agreement. The Agent shall not be responsible to the Lenders for the due
execution, genuineness, validity, enforceability or effectiveness of this
Agreement or other instruments or agreements. The Agent may deem and treat the
Lender that makes any Loan as the holder of the indebtedness resulting therefrom
for all purposes hereof until it shall have received notice from such Lender,
given as provided herein, of the transfer thereof. The Agent shall in all cases
be fully protected in acting, or refraining from acting, in accordance with
written instructions signed by the Required Lenders and, except as otherwise
specifically provided herein, such instructions and any action or inaction
pursuant thereto shall be binding on all the Lenders. The Agent shall, in the
absence of knowledge to the contrary, be entitled to rely on any instrument or
document believed by it in good faith to be genuine and correct and to have been
signed or sent by the proper person or persons. None of the Agent or any of its
directors, officers, employees or agents shall have any responsibility to the
Borrower on account of the failure of or delay in performance or breach by any
Lender of any of its obligations hereunder or to any Lender on account of the
failure of or delay in performance or breach by any other Lender or the Borrower
of any of their respective obligations hereunder or in connection herewith. The
Agent may execute any and all duties hereunder by or through agents or employees
and shall be entitled to rely upon the advice of legal counsel selected by it
with respect to all matters arising hereunder and shall not be liable for any
action taken or suffered in good faith by it in accordance with the advice of
such counsel.
The Lenders hereby acknowledge that the Agent shall not be under any
duty to take any discretionary action permitted to be taken by it pursuant to
the provisions of this Agreement unless it shall be requested in writing to do
so by the Required Lenders.
Subject to the appointment and acceptance of a successor Agent as
provided below, the Agent may resign at any time by notifying the Lenders and
the Borrower. Upon any such resignation, the Required Lenders shall have the
right to appoint a successor Agent acceptable to the Borrower. If no successor
shall have been so appointed by the Required Lenders and shall have accepted
such appointment within 30 days after the retiring Agent gives notice of its
resignation, then the retiring Agent may, on behalf of the Lenders, appoint a
successor Agent, which shall be a bank organized under the laws of the United
States and having a combined capital and surplus of at least $500,000,000 or an
Affiliate of any such bank. Upon the acceptance of any appointment as Agent
hereunder by a successor bank, such successor shall succeed to and become vested
with all the rights, powers, privileges and duties of the retiring Agent and the
retiring Agent shall be discharged from its duties and obligations hereunder.
After the Agent's resignation hereunder, the provisions of this Article and
Section 8.05 shall continue in effect for its benefit in respect of any actions
taken or omitted to be taken by it while it was acting as Agent.
With respect to the Loans made by it hereunder, Citibank, in its
individual capacity and not as the Agent, shall have the same rights and powers
as any other Lender and may exercise the same as though it were not the Agent,
and the Agent 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 an Agent.
41
Each Lender agrees (i) to reimburse the Agent, on demand, in the amount
of its pro rata share (based on its Commitment hereunder or, if the Commitments
shall have been terminated, the amount of its outstanding Loans) of any expenses
incurred for the benefit of the Lenders in its role as Agent, including counsel
fees and compensation of agents and employees paid for services rendered on
behalf of the Lenders, which shall not have been reimbursed by the Borrower and
(ii) to indemnify and hold harmless the Agent and any of its directors,
officers, employees or agents, on demand, in the amount of such pro rata share,
from and against any and all liabilities, taxes, obligations, losses, damages,
penalties, actions, judgments, suits, costs, expenses or disbursements of any
kind or nature whatsoever that may be imposed on, incurred by or asserted
against it in any way relating to or arising out of this Agreement or any action
taken or omitted by it under this Agreement to the extent the same shall not
have been reimbursed by the Borrower; provided that no Lender shall be liable to
the Agent for any portion of such liabilities, obligations, losses, damages,
penalties, actions, judgments, suits, costs, expenses or disbursements resulting
from the gross negligence or willful misconduct of the Agent or any of its
directors, officers, employees or agents.
Each Lender acknowledges that it has, independently and without
reliance upon the 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 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 or any related agreement or any document
furnished hereunder or thereunder.
NEITHER XXXXXXX XXXXX XXXXXX INC. NOR BANC OF AMERICA SECURITIES LLC,
BY VIRTUE OF ITS DESIGNATION AS "JOINT LEAD ARRANGER" AND "CO-BOOK MANAGER", NOR
BANK OF AMERICA, N.A., BY VIRTUE OF ITS DESNIGATION AS "SYNDICATION AGENT",
SHALL HAVE ANY DUTIES, LIABILITIES, OBLIGATIONS OR RESPONSIBILITIES UNDER THIS
AGREEMENT.
ARTICLE VIII
MISCELLANEOUS
SECTION 8.01. Notices.
Notices and other communications provided for herein shall be in
writing and shall be delivered by hand or overnight courier service, mailed or
sent by telecopy, as follows:
(a) if to the Borrower, to TXU Business Services Company, Energy
Plaza, 0000 Xxxxx Xxxxxx, 00xx Xxxxx, Xxxxxx, XX 00000, Attention: Treasurer
(Telecopy No. 214-812-2488);
(b) if to the Agent, to Citibank, N.A., Xxx Xxxxx Xxx, Xxxxx 000,
Xxx Xxxxxx, Xxxxxxxx 00000, Attention: Bank Loan Syndications; and
42
(c) if to a Lender, to it at its address (or telecopy number) set
forth in the Register or in the Assignment and Acceptance pursuant to which such
Lender became a party hereto.
All notices and other communications given to any party hereto in accordance
with the provisions of this Agreement shall be deemed to have been given on the
date of receipt if delivered by hand or overnight courier service or sent by
telecopy to such party as provided in this Section or in accordance with the
latest unrevoked direction from such party given in accordance with this
Section.
SECTION 8.02. Survival of Agreement.
All covenants, agreements, representations and warranties made by the
Borrower herein and in the certificates or other instruments prepared or
delivered in connection with or pursuant to this Agreement shall be considered
to have been relied upon by the Lenders and shall survive the making by the
Lenders of the Loans regardless of any investigation made by the Lenders or on
their behalf, and shall continue in full force and effect as long as the
principal of or any accrued interest on any Loan or any Fee or any other amount
payable under this Agreement is outstanding and unpaid or the Commitments have
not been terminated.
SECTION 8.03. Binding Effect.
This Agreement shall become effective when it shall have been executed
by the Borrower and the Agent and when the Agent shall have received copies
hereof (telecopied or otherwise) which, when taken together, bear the signature
of each Lender, and thereafter shall be binding upon and inure to the benefit of
the parties hereto and their respective successors and assigns, except that the
Borrower shall not have the right to assign any rights hereunder or any interest
herein without the prior consent of all the Lenders.
SECTION 8.04. Successors and Assigns.
(a) Whenever in this Agreement any of the parties hereto is
referred to, such reference shall be deemed to include the successors and
assigns of such party; and all covenants, promises and agreements by or on
behalf of any party that are contained in this Agreement shall bind and inure to
the benefit of its successors and assigns.
(b) Each Lender may assign to one or more assignees all or a
portion of its interests, rights and obligations under this Agreement (including
all or a portion of its Commitment and the Loans at the time owing to it);
provided, however, that (i) except in the case of an assignment to a Lender or
an Affiliate of such Lender, an assignment to a Federal Reserve Bank or an
assignment made at any time an Event of Default shall have occurred and be
continuing, the Borrower and the Agent must give their prior written consent to
such assignment (which consent shall not be unreasonably withheld), (ii) the
amount of the Commitment of the assigning Lender subject to each such assignment
(determined as of the date the Assignment and Acceptance with respect to such
assignment is delivered to the Agent) shall not be less than $1,000,000 or, if
the amount of the Commitment of the assigning Lender is less than $1,000,000,
the aggregate amount of such Lender's Commitment, (iii) each such assignment
shall be of a constant, and not a varying, percentage of all the assigning
Lender's rights and obligations under this Agreement, and (iv) the parties to
each such assignment shall execute and deliver to the Agent an Assignment
43
and Acceptance, and a processing and recordation fee of $3,500. Upon acceptance
and recording pursuant to Section 8.04(e), from and after the effective date
specified in each Assignment and Acceptance, which effective date shall be at
least five Business Days after the execution thereof unless otherwise agreed by
the Agent (the Borrower to be given reasonable notice of any shorter period),
(A) the assignee thereunder shall be a party hereto and, to the extent of the
interest assigned by such Assignment and Acceptance, have the rights and
obligations of a Lender under this Agreement and (B) the assigning Lender
thereunder shall, to the extent of the interest assigned by such Assignment and
Acceptance, be released from its obligations under this Agreement (and, in the
case of an Assignment and Acceptance covering all or the remaining portion of an
assigning Lender's rights and obligations under this Agreement, such Lender
shall cease to be a party hereto (but shall continue to be entitled to the
benefits of Sections 2.11, 2.16 and 8.05 afforded to such Lender prior to its
assignment as well as to any Fees accrued for its account hereunder and not yet
paid)).
(c) By executing and delivering an Assignment and Acceptance, the
assigning Lender thereunder and the assignee thereunder shall be deemed to
confirm to and agree with each other and the other parties hereto as follows:
(i) such assigning Lender warrants that it is the legal and beneficial owner of
the interest being assigned thereby free and clear of any adverse claim, (ii)
except as set forth in (i) above, such assigning Lender makes no representation
or warranty and assumes no responsibility with respect to any statements,
warranties or representations made in or in connection with this Agreement, or
the execution, legality, validity, enforceability, genuineness, sufficiency or
value of this Agreement or any other instrument or document furnished pursuant
hereto or the financial condition of the Borrower or the performance or
observance by the Borrower of any obligations under this Agreement or any other
instrument or document furnished pursuant hereto; (iii) such assignor and such
assignee represents and warrants that it is legally authorized to enter into
such Assignment and Acceptance; (iv) such assignee confirms that it has received
a copy of this Agreement, together with copies of the most recent financial
statements delivered pursuant to Section 5.03 and such other documents and
information as it has deemed appropriate to make its own credit analysis and
decision to enter into such Assignment and Acceptance; (v) such assignee will
independently and without reliance upon the Agent, such assigning Lender or any
other Lender and based on such documents and information as it shall deem
appropriate at the time, continue to make its own credit decisions in taking or
not taking action under this Agreement; (vi) such assignee appoints and
authorizes the Agent to take such action as agent on its behalf and to exercise
such powers under this Agreement as are delegated to the Agent by the terms
hereof, together with such powers as are reasonably incidental thereto; and
(vii) such assignee agrees that it will perform in accordance with their terms
all the obligations which by the terms of this Agreement are required to be
performed by it as a Lender.
(d) The Agent shall maintain at one of its offices in the City of
New York a copy of each Assignment and Acceptance delivered to it and a register
for the recordation of the names and addresses of the Lenders, and the
Commitment of, and the principal amount of the Loans owing to, each Lender
pursuant to the terms hereof from time to time (the "Register"). The entries in
the Register shall be conclusive in the absence of manifest error and the
Borrower, the Agent and the Lenders may treat each person whose name is recorded
in the Register pursuant to the terms hereof as a Lender hereunder for all
purposes of this Agreement. The Register shall be
44
available for inspection by each party hereto, at any reasonable time and from
time to time upon reasonable prior notice.
(e) Upon its receipt of a duly completed Assignment and Acceptance
executed by an assigning Lender and an assignee, the processing and recordation
fee referred to in paragraph (b) above and, if required, the written consent of
the Borrower and the Agent to such assignment, the Agent shall (i) accept such
Assignment and Acceptance and (ii) record the information contained therein in
the Register.
(f) Each Lender may, without the consent of the Borrower or the
Agent, sell participations to one or more banks or other entities in all or a
portion of its rights and/or obligations under this Agreement (including all or
a portion of its Commitment and the Loans owing to it); provided, however, that
(i) such Lender's obligations under this Agreement shall remain unchanged, (ii)
such Lender shall remain solely responsible to the other parties hereto for the
performance of such obligations, (iii) each participating bank or other entity
shall be entitled to the benefit of the cost protection provisions contained in
Sections 2.11, 2.16 and 8.05 to the same extent as if it were the selling Lender
(and limited to the amount that could have been claimed by the selling Lender
had it continued to hold the interest of such participating bank or other
entity), except that all claims made pursuant to such Sections shall be made
through such selling Lender, and (iv) the Borrower, the Agent and the other
Lenders shall continue to deal solely and directly with such selling Lender in
connection with such Lender's rights and obligations under this Agreement, and
such Lender shall retain the sole right to enforce the obligations of the
Borrower under this Agreement and to approve any amendment, modification or
waiver of any provision of this Agreement (other than amendments, modifications
or waivers (x) decreasing any fees payable hereunder or the amount of principal
of, or the rate at which interest is payable on, the Loans or (y) extending any
scheduled principal payment date or date fixed for the payment of interest on
the Loans).
(g) Any Lender or participant may, in connection with any
assignment or participation or proposed assignment or participation pursuant to
this Section, disclose to the assignee or participant or proposed assignee or
participant any information relating to the Borrower furnished to such Lender by
or on behalf of the Borrower; provided that, prior to any such disclosure, each
such assignee or participant or proposed assignee or participant shall execute
an agreement whereby such assignee or participant shall agree (subject to
customary exceptions) to preserve the confidentiality of any such information.
(h) The Borrower shall not assign or delegate any rights and
duties hereunder without the prior written consent of all Lenders, and any
attempted assignment or delegation (except as a consequence of a transaction
expressly permitted under Section 5.09) by the Borrower without such consent
shall be void.
(i) Any Lender may at any time pledge all or any portion of its
rights under this Agreement to a Federal Reserve Bank; provided that no such
pledge shall release any Lender from its obligations hereunder or substitute any
such Bank for such Lender as a party hereto. In order to facilitate such an
assignment to a Federal Reserve Bank, the Borrower shall, at the request of the
assigning Lender, duly execute and deliver to the assigning Lender a promissory
note or notes evidencing the Loans made to the Borrower by the assigning Lender
hereunder.
45
SECTION 8.05. Expenses; Indemnity.
(a) The Borrower agrees to pay all reasonable out-of-pocket
expenses (including reasonable fees, charges and disbursements of counsel)
incurred by the Agent in connection with entering into this Agreement or in
connection with any amendments, modifications or waivers of the provisions
hereof (but only if such amendments, modifications or waivers are requested by
the Borrower) (whether or not the transactions hereby contemplated are
consummated), or incurred by the Agent or any Lender in connection with the
enforcement of its rights in connection with this Agreement or in connection
with the Loans made hereunder, including the reasonable fees and disbursements
of counsel for the Agent and, in the case of enforcement following an Event of
Default, the Lenders.
(b) The Borrower agrees to indemnify each Lender against any loss,
calculated in accordance with the next sentence, or reasonable expense which
such Lender may sustain or incur as a consequence of (i) any failure by the
Borrower to borrow or to refinance, convert or continue any Loan hereunder
(including as a result of the Borrower's failure to fulfill any of the
applicable conditions set forth in Article IV) after irrevocable notice of such
borrowing, refinancing, conversion or continuation has been given pursuant to
Section 2.03, (ii) any assignment of a Eurodollar Loan required by the Borrower
or payment, prepayment or conversion of a Eurodollar Loan required by any
provision of this Agreement or otherwise made or deemed made on a date other
than the last day of the Interest Period, if any, applicable thereto, (iii) any
default in payment or prepayment of the principal amount of any Loan or any part
thereof or interest accrued thereon, as and when due and payable (at the due
date thereof, whether by scheduled maturity, acceleration, irrevocable notice of
prepayment or otherwise) or (iv) the occurrence of any Event of Default,
including, in each such case, any loss or reasonable expense sustained or
incurred or to be sustained or incurred by such Lender in liquidating or
employing deposits from third parties, or with respect to commitments made or
obligations undertaken with third parties, to effect or maintain any Loan
hereunder or any part thereof as a Eurodollar Loan. Such loss shall include an
amount equal to the excess, if any, as reasonably determined by such Lender, of
(x) its cost of obtaining the funds for the Loan being paid, prepaid,
refinanced, converted or not borrowed (assumed to be the LIBO Rate) for the
period from the date of such payment, prepayment, refinancing or failure to
borrow or refinance to the last day of the Interest Period for such Loan (or, in
the case of a failure to borrow or refinance the Interest Period for such Loan
which would have commenced on the date of such failure) over (y) the amount of
interest (as reasonably determined by such Lender) that would be realized by
such Lender in reemploying the funds so paid, prepaid or not borrowed or
refinanced for such period or Interest Period, as the case may be.
(c) The Borrower agrees to indemnify the Agent, the Joint Lead
Arrangers, each Lender, each of their Affiliates and the directors, officers,
employees and agents of the foregoing (each such person being called an
"Indemnitee") against, and to hold each Indemnitee harmless from, any and all
losses, claims, damages, liabilities and related expenses, including reasonable
counsel fees and expenses, incurred by or asserted against any Indemnitee
arising out of (i) the use of the proceeds of the Loans, (ii) the preparation,
execution, delivery, enforcement, performance and administration of this
Agreement or (iii) any claim, litigation, investigation or proceeding relating
to any of the foregoing, whether or not any Indemnitee is a party thereto,
including any of the foregoing arising from the negligence, whether sole or
concurrent, on the
46
part of any Indemnitee; provided that such indemnity shall not, as to any
Indemnitee, be available to the extent that such losses, claims, damages,
liabilities or related expenses (A) are determined by a final judgment of a
court of competent jurisdiction to have resulted from the gross negligence or
willful misconduct of such Indemnitee or (B) result from any litigation brought
by such Indemnitee against the Borrower or by the Borrower against such
Indemnitee, in which a final, nonappealable judgment has been rendered against
such Indemnitee; provided, further, that the Borrower agrees that it will not,
nor will it permit any Subsidiary to, without the prior written consent of each
Indemnitee, settle, compromise or consent to the entry of any judgment in any
pending or threatened claim, action, suit or proceeding in respect of which
indemnification could be sought under the indemnification provisions of this
Section 8.05(c) (whether or not any Indemnitee is an actual or potential party
to such claim, action, suit or proceeding), unless such settlement, compromise
or consent does not include any statement as to an admission of fault,
culpability or failure to act by or on behalf of any Indemnitee and does not
involve any payment of money or other value by any Indemnitee or any injunctive
relief or factual findings or stipulations binding on any Indemnitee.
(d) The provisions of this Section shall remain operative and in
full force and effect regardless of the expiration of the term of this
Agreement, the consummation of the transactions contemplated hereby, the
repayment of any of the Loans, the invalidity or unenforceability of any term or
provision of this Agreement or any investigation made by or on behalf of the
Agent or any Lender. All amounts due under this Section shall be payable on
written demand therefor.
(e) A certificate of any Lender or the Agent setting forth any
amount or amounts which such Lender or the Agent is entitled to receive pursuant
to paragraph (b) of this Section and containing an explanation in reasonable
detail of the manner in which such amount or amounts shall have been determined
shall be delivered to the Borrower and shall be conclusive absent manifest
error.
SECTION 8.06. Right of Setoff.
If an Event of Default shall have occurred and be continuing, each
Lender is hereby authorized at any time and from time to time, to the fullest
extent permitted by law, to set off and apply any and all deposits (general or
special, time or demand, provisional or final) at any time held and other
indebtedness at any time owing by such Lender to or for the credit or the
account of the Borrower against any and all of the obligations of the Borrower
now or hereafter existing under 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 8.07. Applicable Law.
THIS AGREEMENT SHALL BE CONSTRUED IN ACCORDANCE WITH AND GOVERNED BY
THE LAWS OF THE STATE OF NEW YORK.
47
SECTION 8.08. Waivers; Amendment.
(a) No failure or delay of the Agent or any Lender in exercising
any power or right hereunder 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 Agent and the Lenders hereunder are cumulative and are not
exclusive of any rights or remedies which they would otherwise have. No waiver
of any provision of this Agreement or consent to any departure therefrom shall
in any event be effective unless the same shall be permitted by paragraph (b)
below, and then such waiver or consent shall be effective only in the specific
instance and for the purpose for which given. No notice or demand on the
Borrower or any Subsidiary in any case shall entitle such party to any other or
further notice or demand in similar or other circumstances.
(b) Neither this Agreement nor any provision hereof may be waived,
amended or modified except pursuant to an agreement or agreements in writing
entered into by the Borrower and the Required Lenders; provided, however, that
no such agreement shall (i) decrease the principal amount of, or extend the
maturity of or any scheduled principal payment date or date for the payment of
any interest on any Loan or the date for the payment of any Commitment Fee, or
waive or excuse any such payment or any part thereof, or decrease the rate of
interest on any Loan, without the prior written consent of each Lender affected
thereby, (ii) increase the Commitment of any Lender, decrease the Commitment Fee
of any Lender without the prior written consent of such Lender, or (iii) amend
or modify the provisions of Section 2.13, 2.14 or Section 8.04(h), the
provisions of this Section or the definition of the "Required Lenders", without
the prior written consent of each Lender; provided further, however, that no
such agreement shall amend, modify or otherwise affect the rights or duties of
the Agent hereunder without the prior written consent of the Agent. Each Lender
shall be bound by any waiver, amendment or modification authorized by this
Section and any consent by any Lender or the Agent pursuant to this Section
shall bind any assignee of its rights and interests hereunder.
SECTION 8.09. Entire Agreement.
This Agreement (including the schedules and exhibits hereto) and the
Letter Agreement represent the entire contract among the parties relative to the
subject matter hereof and thereof. Any previous agreement, whether written or
oral, among the parties with respect to the subject matter hereof, is superseded
by this Agreement and the Letter Agreement. There are no unwritten oral
agreements between the parties. Nothing in this Agreement, expressed or implied,
is intended to confer upon any party other than the parties hereto any rights,
remedies, obligations or liabilities under or by reason of this Agreement.
SECTION 8.10. Severability.
In the event any one or more of the provisions contained in this
Agreement should be held invalid, illegal or unenforceable in any respect, the
validity, legality and enforceability of the remaining provisions contained
herein shall not in any way be affected or impaired thereby. The parties shall
endeavor in good-faith negotiations to replace the invalid, illegal or
48
unenforceable provisions with valid provisions the economic effect of which
comes as close as possible to that of the invalid, illegal or unenforceable
provisions.
SECTION 8.11. Counterparts.
This Agreement may be executed in two or more counterparts, each of
which shall constitute an original but all of which when taken together shall
constitute but one contract, and shall become effective as provided in Section
8.03.
SECTION 8.12. Headings.
Article and Section headings and the Table of Contents used herein are
for convenience of reference only, are not part of this Agreement and are not to
affect the construction of, or to be taken into consideration in interpreting,
this Agreement.
SECTION 8.13. Interest Rate Limitation.
(a) Notwithstanding anything herein to the contrary, if at any
time the applicable interest rate, together with all fees and charges which are
treated as interest under applicable law (collectively the "Charges"), as
provided for herein or in any other document executed in connection herewith, or
otherwise contracted for, charged, received, taken or reserved by any Lender,
shall exceed the maximum lawful rate (the "Maximum Rate") which may be
contracted for, charged, taken, received or reserved by such Lender in
accordance with applicable law, the rate of interest payable on the Loans of
such Lender, together with all Charges payable to such Lender, shall be limited
to the Maximum Rate.
(b) If the amount of interest, together with all Charges, payable
for the account of any Lender in respect of any interest computation period is
reduced pursuant to paragraph (a) of this Section and the amount of interest,
together with all Charges, payable for such Lender's account in respect of any
subsequent interest computation period, computed pursuant to Section 2.06, would
be less than the Maximum Rate, then the amount of interest, together with all
Charges, payable for such Lender's account in respect of such subsequent
interest computation period shall, to the extent permitted by applicable law, be
automatically increased to such Maximum Rate; provided that at no time shall the
aggregate amount by which interest paid for the account of any Lender has been
increased pursuant to this paragraph (b) exceed the aggregate amount by which
interest, together with all Charges, paid for its account has theretofore been
reduced pursuant to paragraph (a) of this Section.
SECTION 8.14. Jurisdiction; Venue.
(a) The Borrower hereby irrevocably and unconditionally submits,
for itself and its property, to the nonexclusive jurisdiction of any New York
State court or Federal court of the United States of America sitting in New York
City, and any appellate court from any thereof, in any action or proceeding
arising out of or relating to this Agreement, or 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
49
conclusive and may be enforced in other jurisdictions by suit on the judgment or
in any other manner provided by law. Subject to the foregoing and to paragraph
(b) below, nothing in this Agreement shall affect any right that any party
hereto may otherwise have to bring any action or proceeding relating to this
Agreement against any other party hereto in the courts of any jurisdiction.
(b) The Borrower hereby irrevocably and unconditionally waives, to
the fullest extent it may legally and effectively do so, any objection which it
may now or thereafter have to the laying of venue of any suit, action or
proceeding arising out of or relating to this Agreement in any New York State
court or Federal court of the United States of America sitting in New York City.
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.
SECTION 8.15. Confidentiality.
Each Lender shall use its best efforts to hold in confidence all
information, memoranda, or extracts furnished to such Lender (directly or
through the Agent) by the Borrower hereunder or in connection with the
negotiation hereof; provided that such Lender may disclose any such information,
memoranda or extracts (i) to its Affiliates, accountants or counsel, (ii) to any
regulatory agency having authority to examine such Lender, (iii) as required by
any legal or governmental process or otherwise by law, (iv) except as provided
in the last sentence of Section 5.03, to any person to which such Lender sells
or proposes to sell an assignment or a participation in its Loans hereunder, if
such other person agrees for the benefit of the Borrower to comply with the
provisions of this Section and (v) to the extent that such information,
memoranda or extracts shall be publicly available or shall have become known to
such Lender independently of any disclosure by the Borrower hereunder or in
connection with the negotiation hereof. Notwithstanding the foregoing, any
Lender may disclose the provisions of this Agreement and the amounts, maturities
and interest rates of its Loans to any purchaser or potential purchaser of such
Lender's interest in any Loan.
[Signature pages follow]
S-1
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.
TXU CORP.
By /s/ Xxxx X. Xxxxxx
----------------------------------
Name: Xxxx X. Xxxxxx
Title: Treasurer and Assistant
Secretary
CITIBANK, N.A.
as Agent
By /s/ Xxxxxx X. Xxxx
----------------------------------
Name: Xxxxxx X. Xxxx
Title: Vice President
Signature Page to TXU Corp. Three Year Revolving Credit Agreement
S-2
BANK OF AMERICA, N.A.
By /s/ Xxxxxxxx X. Xxxxxxxxxx
----------------------------------
Name: Xxxxxxxx X. Xxxxxxxxxx
Title: Principal
Signature Page to TXU Corp. Three Year Revolving Credit Agreement
S-3
CITIBANK, N.A.
By /s/ Xxxxxx X. Xxxx
----------------------------------
Name: Xxxxxx X. Xxxx
Title: Vice President
Signature Page to TXU Corp. Three Year Revolving Credit Agreement
X-0
XXXXXXXXXXX XX, XXX XXXX AND
GRAND CAYMAN BRANCHES
By /s/ Xxxxx X. Xxxxxx
----------------------------------
Name: Xxxxx X. Xxxxxx
Title: SVP & Manager
By /s/ Xxxxxx X. Xxxxxxxxxxx
----------------------------------
Name: Xxxxxx X. Xxxxxxxxxxx
Title: Senior Vice President
Signature Page to TXU Corp. Three Year Revolving Credit Agreement
S-5
CREDIT LYONNAIS NEW YORK BRANCH
By /s/ Xxxxxxx Xxxxxxxxx
----------------------------------
Name: Xxxxxxx Xxxxxxxxx
Title: Senior Vice President
Signature Page to TXU Corp. Three Year Revolving Credit Agreement
S-6
CREDIT SUISSE FIRST BOSTON
By /s/ Xxxx X. Xxxxx
----------------------------------
Name: Xxxx X. Xxxxx
Title: Vice President
By /s/ Xxxxxxx Xxxxx
----------------------------------
Name: Xxxxxxx Xxxxx
Title: Associate
Signature Page to TXU Corp. Three Year Revolving Credit Agreement
S-7
XXXXXXX XXXXX BANK USA
By /s/ D. Xxxxx Xxxxx
----------------------------------
Name: D. Xxxxx Xxxxx
Title: Senior Credit Officer
Signature Page to TXU Corp. Three Year Revolving Credit Agreement
S-8
XXXXXXX XXXXX CAPITAL CORPORATION
By /s/ Xxxxx X.X. Xxxxxx
----------------------------------
Name: Xxxxx X.X. Xxxxxx
Title: Xxxxxxx Xxxxx Capital Corp.
Signature Page to TXU Corp. Three Year Revolving Credit Agreement
EXHIBIT A
Form of Borrowing Request
BORROWING REQUEST
[Date]
Citibank, N.A.,
as Agent for the Lenders referred to below
[address]
Ladies and Gentlemen:
The undersigned, TXU Corp. (the "Borrower"), refers to the Three Year
Revolving Credit Agreement, dated as of May 1, 2002 (as it may hereafter be
amended, modified, extended or restated from time to time, the "Agreement"),
among the Borrower, the lenders listed in Schedule 2.01 thereto (the "Lenders")
and Citibank, N.A., as agent for the Lenders. Capitalized terms used herein and
not otherwise defined herein shall have the meanings assigned to such terms in
the Agreement. The Borrower hereby gives you notice pursuant to Section 2.03 of
the Agreement that it requests a Borrowing under the Agreement, and in that
connection sets forth below the terms on which such Borrowing is requested to be
made:
(A) Date of Borrowing (which is a Business Day) ______________
(B) Principal amount of Borrowing/1/ ______________
(C) Interest rate basis/2/ ______________
(D) Interest Period and the last day thereof/3/ ______________
------------------------------------
/1/ Not less than $10,000,000 (and in integral multiples of $5,000,000)
or greater than the Total Commitment then available.
/2/ Eurodollar Loan or ABR Loan.
/3/ Which shall be subject to the definition of "Interest Period" and end
not later than the Maturity Date.
2
Upon acceptance of any or all of the Loans made by the Lenders in
response to this request, the Borrower shall be deemed to have represented and
warranted that the applicable conditions to lending specified in Article IV of
the Agreement have been satisfied.
Very truly yours,
TXU CORP.
By _________________________________
Name:
Title: [Financial Officer]
EXHIBIT B
Form of Assignment and Acceptance
ASSIGNMENT AND ACCEPTANCE
[Date]
Reference is made to the Three Year Revolving Credit Agreement, dated
as of May 1, 2002 (as amended, modified, extended or restated from time to time,
the "Agreement"), among TXU Corp. (the "Borrower"), the lenders listed in
Schedule 2.01 thereto (the "Lenders"), and Citibank, N.A., as agent for the
Lenders. Terms defined in the Agreement are used herein with the same meanings.
1. The Assignor hereby sells and assigns, without recourse, to the
Assignee, and the Assignee hereby purchases and assumes, without recourse, from
the Assignor, effective as of the [EFFECTIVE DATE OF ASSIGNMENT], the interests
set forth on the reverse hereof (the "Assigned Interest") in the Assignor's
rights and obligations under the Agreement, including, without limitation, the
interests set forth on the reverse hereof in the Commitment of the Assignor on
the [EFFECTIVE DATE OF ASSIGNMENT] and the Loans owing to the Assignor that are
outstanding on the [EFFECTIVE DATE OF ASSIGNMENT], together with unpaid interest
accrued on the assigned Loans to the [EFFECTIVE DATE OF ASSIGNMENT] and the
amount, if any, set forth on the reverse hereof of the Fees accrued to the
[EFFECTIVE DATE OF ASSIGNMENT] for the account of the Assignor. Each of the
Assignor and the Assignee hereby makes and agrees to be bound by all the
representations, warranties and agreements set forth in Section 8.04 of the
Agreement, a copy of which has been received by each such party. From and after
the [EFFECTIVE DATE OF ASSIGNMENT], (i) the Assignee shall be a party to and be
bound by the provisions of the Agreement and, to the extent of the interests
assigned by this Assignment and Acceptance, have the rights and obligations of a
Lender thereunder and (ii) the Assignor shall, to the extent of the interests
assigned by this Assignment and Acceptance, relinquish its rights and be
released from its obligations under the Agreement.
2. This Assignment and Acceptance is being delivered to the Agent
together with (i) if the Assignee is organized under the laws of a jurisdiction
outside the United States, the forms specified in Section 2.16(g) of the
Agreement, duly completed and executed by such Assignee and (ii) a processing
and recordation fee of $3,500.
2
3. This Assignment and Acceptance shall be governed by and construed in
accordance with the laws of the State of New York.
Date of Assignment:
Legal Name of Assignor:
Legal Name of Assignee:
Assignee's Address for Notices:
Effective Date of Assignment
(may not be fewer than 5 Business
Days after the Date of Assignment
unless otherwise agreed by the
Agent):
------------------------------ -------------------------------------- --------------------------------------------
Percentage Assigned of
Facility/Commitment (set forth, to at
Facility Principal Amount Assigned least 8 decimals, as a percentage of the
Facility and the aggregate Commitments of
all Lenders thereunder)
Commitment Assigned: $____________ __________%
Loans: $____________ __________%
Fees Assigned (if any): $____________ __________%
3
The terms set forth and on the reverse Accepted:
side hereof are hereby agreed to: TXU CORP.
____________________________________, as By _____________________________
Assignor Name:
Title:
By __________________________, as
Name:
Title: CITIBANK, N.A.,
as Agent
____________________________________, as
Assignee,
By _____________________________
By __________________________, as Name:
Name: Title:
Title:
SCHEDULE 2.01
COMMITMENTS
-----------------------------------------------------------------------------
NAME OF LENDER COMMITMENT
-----------------------------------------------------------------------------
Bank of America, N.A. $100,000,000
-----------------------------------------------------------------------------
Citibank, N.A. $100,000,000
-----------------------------------------------------------------------------
Credit Suisse First Boston $100,000,000
-----------------------------------------------------------------------------
Commerzbank AG, New York and Grand Cayman Branches $50,000,000
-----------------------------------------------------------------------------
Credit Lyonnais New York Branch $50,000,000
-----------------------------------------------------------------------------
Xxxxxxx Xxxxx Bank USA $50,000,000
-----------------------------------------------------------------------------
Xxxxxxx Xxxxx Capital Corporation $50,000,000
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Total $500,000,000
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SCHEDULE 5.13
RESTRICTIVE AGREEMENTS
Oncor Mortgage
