Exhibit 10
SECOND AMENDED AND RESTATED
CREDIT AGREEMENT
among
KLT INC.,
BANK ONE, NA,
as Agent,
COMMERZBANK AKTIENGESELLSCHAFT,
NEW YORK AND GRAND CAYMAN BRANCHES,
as Syndication Agent,
WESTDEUTSCHE LANDESBANK GIROZENTRALE,
NEW YORK BRANCH,
as Documentation Agent,
and
the LENDERS named herein
Dated as of June 30, 2000
TABLE OF CONTENTS
ARTICLE I DEFINITIONS 1
ARTICLE II THE CREDITS 11
2.1. Commitment 11
2.2. Required Payments; Termination 11
2.3. Ratable Loans 12
2.4. Types of Advances 12
2.5. Facility and Letter of Credit Fees; Reductions in
Aggregate Commitment 12
2.6. Minimum Amount of Each Advance 12
2.7. Optional Principal Payments 12
2.8. Method of Selecting Types and Interest Periods
for New Advances 13
2.9. Conversion and Continuation of Outstanding Advances 13
2.10. Changes in Interest Rate, etc. 14
2.11. Rates Applicable After Default 14
2.12. Method of Payment 14
2.13. Notes; Telephonic Notices 14
2.14. Interest Payment Dates; Interest and Fee Basis 15
2.15. Notification of Advances, Interest Rates,
Prepayments and Commitment Reductions 15
2.16. Lending Installations 15
2.17. Non-Receipt of Funds by the Agent 16
2.18. Withholding Tax Exemption 16
2.19 Letter of Credit Procedures 16
2.20 Participations in Letters of Credit 17
2.21 Reimbursement Obligations; Repayment From Loans 17
2.22 Limitation on Bank One's Obligations 17
2.23 Funding by Lenders to Bank One 18
ARTICLE III CHANGE IN CIRCUMSTANCES 19
3.1. Yield Protection 19
3.2. Changes in Capital Adequacy Regulations 19
3.3. Availability of Types of Advances 20
3.4. Funding Indemnification 20
3.5. Lender Statements; Survival of Indemnity 20
ARTICLE IV CONDITIONS PRECEDENT 21
4.1. Conditions Precedent to Effectiveness 21
4.2. Each Advance 22
ARTICLE V REPRESENTATIONS AND WARRANTIES 23
5.1. Corporate Existence and Standing 23
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5.2. Authorization and Validity 23
5.3. No Conflict; Government Consent 23
5.4. Financial Statements 24
5.5. Material Adverse Change 24
5.6. Taxes 24
5.7. Litigation and Contingent Obligations 24
5.8. Subsidiaries 24
5.9. ERISA 24
5.10. Accuracy of Information 25
5.11. Regulation U 25
5.12. Material Agreements 25
5.13. Compliance With Laws 25
5.14. Ownership of Properties 25
5.15. Investment Company Act 25
5.16. Public Utility Holding Company Act 25
5.17. Insurance 26
ARTICLE VI COVENANTS 26
6.1. Financial Reporting 26
6.2. Use of Proceeds 27
6.3. Notice of Default 28
6.4. Conduct of Business 28
6.5. Taxes 28
6.6. Insurance 28
6.7. Compliance with Laws 28
6.8. Maintenance of Properties 28
6.9. Inspection 28
6.10. Dividends 29
6.11. Indebtedness 29
6.12. Merger 29
6.13. Sale of Assets 30
6.14. Sale of Accounts 30
6.15. Sale and Leaseback 30
6.16. Investments and Acquisitions 30
6.17. KLT Investments 31
6.18. Liens 31
6.19. Leverage Ratio 32
6.20. Net Worth 33
6.21. Affiliates 33
6.22. Amendments to Agreements 33
6.23. Adjusted Leverage Ratio 33
ARTICLE VII DEFAULTS 33
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ARTICLE VIII ACCELERATION, WAIVERS, AMENDMENTS AND REMEDIES 36
8.1. Acceleration 36
8.2. Amendments 36
8.3. Preservation of Rights 37
ARTICLE IX GENERAL PROVISIONS 37
9.1. Survival of Representations 37
9.2. Governmental Regulation 37
9.3. Taxes 37
9.4. Headings 37
9.5. Entire Agreement 38
9.6. Several Obligations; Benefits of this Agreement 38
9.7. Expenses; Indemnification 38
9.8. Numbers of Documents 38
9.9. Accounting 38
9.10. Severability of Provisions 39
9.11. Nonliability of Lenders 39
9.12. CHOICE OF LAW 39
9.13. CONSENT TO JURISDICTION 39
9.14. WAIVER OF JURY TRIAL 39
9.15. Confidentiality 40
9.16. Nonreliance 40
9.17. Effect on Prior Agreement; Ratification 40
ARTICLE X THE AGENT 41
10.1. Appointment 41
10.2. Powers 41
10.3. General Immunity 41
10.4. No Responsibility for Loans, Recitals, etc. 41
10.5. Action on Instructions of Lenders 41
10.6. Employment of Agents and Counsel 42
10.7. Reliance on Documents; Counsel 42
10.8. Agent's Reimbursement and Indemnification 42
10.9. Rights as a Lender 42
10.10. Lender Credit Decision 42
10.11. Successor Agent 43
10.12. Agent's Fee 43
10.13. Other Agents 43
ARTICLE XI SETOFF; RATABLE PAYMENTS 44
11.1. Setoff 44
11.2. Ratable Payments 44
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ARTICLE XII BENEFIT OF AGREEMENT; ASSIGNMENTS; PARTICIPATIONS 44
12.1. Successors and Assigns 44
12.2. Participations 45
12.3. Assignments 45
12.4. Dissemination of Information 46
12.5. Tax Treatment 46
ARTICLE XIII NOTICES 47
13.1. Giving Notice 47
13.2. Change of Address 47
ARTICLE XIV COUNTERPARTS 47
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EXHIBITS
EXHIBIT "A" NOTE 53
EXHIBIT "B" SUPPORT AGREEMENT 55
EXHIBIT "C-1" KLT INC. PLEDGE AGREEMENT 58
EXHIBIT "C-2" CONFIRMATION OF PLEDGE AGREEMENT 72
EXHIBIT "D-1" FORM OF OPINION OF BORROWER'S COUNSEL 73
EXHIBIT "D-2" FORM OF OPINION OF PARENT'S COUNSEL 77
EXHIBIT "E" COMPLIANCE CERTIFICATE 79
EXHIBIT "F" ASSIGNMENT AGREEMENT 83
EXHIBIT "G" LOAN/CREDIT RELATED MONEY
TRANSFER INSTRUCTION 93
SCHEDULES
SCHEDULE "1" SUBSIDIARIES AND OTHER INVESTMENTS 95
SCHEDULE "2" INDEBTEDNESS AND LIENS 96
SCHEDULE "3" BUSINESS PLAN 97
SCHEDULE 4 PRICING SCHEDULE 98
SCHEDULE 5 COMMITMENT AMOUNTS 99
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KLT INC.
SECOND AMENDED AND RESTATED
CREDIT AGREEMENT
This SECOND AMENDED AND RESTATED CREDIT AGREEMENT, dated as
of June 30, 2000, is among KLT Inc., the Lenders and Bank One,
NA, as Agent. The parties hereto agree as follows:
WHEREAS, the Borrower, Bank One, NA (then known as the First
National Bank of Chicago), as administrative agent, and certain
Lenders (the "Prior Lenders") are parties to an Amended and
Restated Credit Agreement dated as of May 15, 1996 (as amended,
the "Prior Agreement"), pursuant to which the Prior Lenders
agreed to make available to the Borrower revolving credit loans
on the terms and conditions set forth therein; and
WHEREAS, the Borrower, the Agent, and the Lenders party
hereto desire to amend and restate the Prior Agreement in certain
respects as more fully set forth herein; and
WHEREAS, pursuant to the terms of this Agreement, on the
Restatement Date (as defined below), (i) the Prior Agreement
shall be amended and restated pursuant hereto, (ii) all loans and
other obligations of the Borrower to the Prior Lenders
outstanding as of such date shall be deemed to be loans and
obligations under the credit facility described herein, (iii) the
New Lenders (as defined below) shall become parties to this
Agreement, and (iv) all provisions of this Agreement not
previously in effect shall become effective;
NOW, THEREFORE, in consideration of the undertakings set
forth herein and other good and valuable consideration, the
receipt of which is hereby acknowledged, the parties hereto
hereby agree that, effective upon the Restatement Date, the Prior
Agreement is hereby amended and restated in its entirety to read
as follows:
ARTICLE I
DEFINITIONS
As used in this Agreement:
"Acquisition" means any transaction, or any series of
related transactions, consummated on or after the date of this
Agreement, by which the Borrower or any of its Subsidiaries (i)
acquires any going business or all or substantially all of the
assets of any firm, corporation or division thereof, whether
through purchase of assets, merger or otherwise or (ii) directly
or indirectly acquires (in one transaction or as the most recent
transaction in a series of transactions) at least a majority (in
number of votes) of the securities of a corporation which have
ordinary voting power for the election of directors (other than
securities having such power
only by reason of the happening of a contingency) or a majority
(by percentage or voting power) of the outstanding partnership
interests of a partnership.
"Advance" means a borrowing hereunder consisting of the
aggregate amount of the several Loans (including, without
limitation, Loans which result from payments or disbursements
under Letters of Credit pursuant to Section 2.21) made by the
Lenders to the Borrower of the same Type and, in the case of
Eurodollar Advances, for the same Interest Period.
"Affiliate" of any Person means any other Person directly or
indirectly controlling, controlled by or under common control
with such Person. A Person shall be deemed to control another
Person if the controlling Person owns 10% or more of any class of
voting securities (or other ownership interests) of the
controlled Person or possesses, directly or indirectly, the power
to direct or cause the direction of the management or policies of
the controlled Person, whether through ownership of stock, by
contract or otherwise.
"Agent" means Bank One, NA in its capacity as agent for the
Lenders pursuant to Article X, and not in its individual capacity
as a Lender, and any successor Agent appointed pursuant to
Article X.
"Aggregate Commitment" means the aggregate of the
Commitments of all the Lenders, as reduced from time to time
pursuant to the terms hereof.
"Agreement" means this Second Amended and Restated Credit
Agreement, as it may be amended or modified and in effect from
time to time.
"Agreement Accounting Principles" means generally accepted
accounting principles consistently applied as in effect on
December 31, 1999.
"Alternate Base Rate" means, for any day, a rate of interest
per annum equal to the higher of (i) the Corporate Base Rate for
such day and (ii) the sum of Federal Funds Effective Rate for
such day plus 1/2% per annum.
"Applicable Margin" means the percentage rate per annum
which is applicable at such time with respect to Advances of such
Type as set forth in the Pricing Schedule.
"Article" means an article of this Agreement unless another
document is specifically referenced.
"Authorized Officer" means any officer of the Borrower,
acting singly.
"Bank One" means Bank One, NA, a national banking
association, in its individual capacity, and its successors and
assigns.
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"Borrower" means KLT Inc., a Missouri corporation, and its
successors and assigns.
"Borrowing Date" means a date on which an Advance is made
hereunder.
"Borrowing Notice" is defined in Section 2.8.
"Business Day" means (i) with respect to any borrowing,
payment or rate selection of Eurodollar Advances, a day (other
than a Saturday or Sunday) on which banks generally are open in
Chicago and New York for the conduct of substantially all of
their commercial lending activities and on which dealings in
United States dollars are carried on in the London interbank
market and (ii) for all other purposes, a day (other than a
Saturday or Sunday) on which banks generally are open in Chicago
for the conduct of substantially all of their commercial lending
activities.
"Business Plan" means the plans of the Borrower's business
and investment strategy prepared by the Borrower and set forth in
Schedule "3" attached hereto.
"Capitalized Lease" of a Person means any lease of Property
by such Person as lessee which would be capitalized on a balance
sheet of such Person prepared in accordance with Agreement
Accounting Principles.
"Capitalized Lease Obligations" of a Person means the amount
of the obligations of such Person under Capitalized Leases which
would be shown as a liability on a balance sheet of such Person
prepared in accordance with Agreement Accounting Principles.
"Change in Control" means either (i) the Parent shall cease
to own, free and clear of all Liens or other encumbrances, 100%
of the outstanding shares of voting stock of the Borrower on a
fully diluted basis, or (ii) the acquisition by any Person of
beneficial ownership (within the meaning of Rule 13d-3 of the
Securities and Exchange Commission under the Securities Exchange
Act of 1934) of more than 50% of the outstanding shares of voting
stock of the Parent with the ability to vote such beneficial
ownership to direct the affairs of the Parent.
"Code" means the Internal Revenue Code of 1986, as amended,
reformed or otherwise modified from time to time.
"Collateral" means "Collateral" as defined in the Pledge
Agreement.
"Collateral Documents" means, collectively, the Pledge
Agreement and all other agreements, instruments, or documents
necessary to effect the purposes of the Pledge Agreement,
including, without limitation, UCC-1 Financing Statements.
"Commitment" means, for each Lender, the obligation of such
Lender to make Loans not exceeding the amount set forth opposite
its name on Schedule 5 hereto or as set forth in any
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Notice of Assignment relating to any assignment that has become
effective pursuant to Section 12.3.2, as such amount may be
modified from time to time pursuant to the terms hereof.
"Condemnation" is defined in Section 7.8.
"Contingent Obligation" of a Person means any agreement,
undertaking or arrangement by which such Person assumes,
guarantees, endorses, contingently agrees to purchase or provide
funds for the payment of, or otherwise becomes or is contingently
liable upon, the obligation or liability of any other Person, or
agrees to maintain the net worth or working capital or other
financial condition of any other Person, or otherwise assures any
creditor of such other Person against loss, including, without
limitation, any comfort letter, operating agreement or
take-or-pay contract, or application for a letter of credit or
similar instrument by such Person or upon which such Person is an
account party or for which such Person is in any way liable.
"Conversion/Continuation Notice" is defined in Section 2.9.
"Controlled Group" means 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 or any of its Subsidiaries, are treated as a single
employer under Section 414 of the Code.
"Corporate Base Rate" means a rate per annum equal to the
corporate base rate or prime rate of interest announced by Bank
One or its parent from time to time, changing when and as said
corporate base rate or prime rate changes.
"Default" means an event described in Article VII.
"ERISA" means the Employee Retirement Income Security Act of
1974, as amended from time to time, and any rule or regulation
issued thereunder.
"Eurodollar Advance" means an Advance which bears interest
at a Eurodollar Rate.
"Eurodollar Base Rate" means, with respect to a Eurodollar
Advance for the relevant Interest Period, the applicable British
Bankers' Association Interest Settlement Rate for deposits in
U.S. dollars appearing on Reuters Screen FRBD as of 11:00 a.m.
(London time) two Business Days prior to the first day of such
Interest Period, and having a maturity equal to such Interest
Period, provided that, (i) if Reuters Screen FRBD is not
available to the Agent for any reason, the applicable Eurodollar
Base Rate for the relevant Interest Period shall instead be the
applicable British Bankers' Association Interest Settlement Rate
for deposits in U.S. dollars as reported by any other generally
recognized financial information service as of 11:00 a.m. (London
time) two Business Days prior to the first day of such Interest
Period, and having a maturity equal to such Interest Period, and
(ii) if no such British Bankers' Association Interest Settlement
Rate is available to the Agent, the applicable Eurodollar Base
Rate for the relevant Interest Period shall instead be the rate
determined by the Agent to be the rate at which deposits
4
in U.S. dollars are offered by Bank One or one of its Affiliate
banks to first-class banks in the London interbank market at
approximately 11 a.m. (London time) two Business Days prior to
the first day of such Interest Period, in the approximate amount
of Bank One's relevant Eurodollar Loan and having a maturity
equal to such Interest Period.
"Eurodollar Loan" means a Loan which bears interest at a
Eurodollar Rate.
"Eurodollar Rate" means, with respect to a Eurodollar
Advance for the relevant Interest Period, the sum of (i) the
quotient of (a) the Eurodollar Base Rate applicable to such
Interest Period, divided by (b) one minus the Reserve Requirement
(expressed as a decimal) applicable to such Interest Period, if
any, plus (ii) the Applicable Margin. The Eurodollar Rate shall
be rounded to the next higher multiple of 1/16 of 1% if the rate
is not such a multiple.
"Facility Fee Rate" means, at any time, the percentage rate
per annum at which facility fees are accruing on the Aggregate
Commitment at such time as set forth in the Facility Fee column
of the Pricing Schedule.
"Facility Termination Date" means June 30, 2003.
"Federal Funds Effective Rate" means, for any day, an
interest rate per annum equal to the weighted average of the
rates on overnight Federal funds transactions with members of the
Federal Reserve System arranged by Federal funds brokers on such
day, as published for such day (or, if such day is not a Business
Day, for the immediately preceding Business Day) by the Federal
Reserve Bank of New York, or, if such rate is not so published
for any day which is a Business Day, the average of the
quotations at approximately 10:00 a.m. (Chicago time) on such day
on such transactions received by the Agent from three Federal
funds brokers of recognized standing selected by the Agent in its
sole discretion.
"Floating Rate" means, for any day, a rate per annum equal
to the Alternate Base Rate, in each case changing when and as the
Alternate Base Rate changes.
"Floating Rate Advance" means an Advance which bears
interest at the Floating Rate.
"Floating Rate Loan" means a Loan which bears interest at
the Floating Rate.
"Indebtedness" of a Person means such Person's (i)
obligations for borrowed money, (ii) obligations representing the
deferred purchase price of Property or services (other than
accounts payable arising in the ordinary course of such Person's
business payable on terms customary in the trade), (iii)
obligations, whether or not assumed, secured by Liens or payable
out of the proceeds or production from property now or hereafter
owned or acquired by such Person, (iv) obligations which are
evidenced by notes, acceptances, or other instruments, (v)
Capitalized Lease Obligations, (vi) Rate Hedging Obligations, and
(vii) Contingent Obligations.
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"Interest Period" means, with respect to a Eurodollar
Advance, a period of one, two, three, or six months commencing
on a Business Day selected by the Borrower pursuant to this
Agreement. Such Interest Period shall end on (but exclude) the
day which corresponds numerically to such date one, two, three,
or six months thereafter, provided, however, that if there is no
such numerically corresponding day in such next, second, third,
or sixth succeeding month, such Interest Period shall end on the
last Business Day of such next, second, third, or sixth
succeeding month. If an Interest Period would otherwise end on a
day which is not a Business Day, such Interest Period shall end
on the next succeeding Business Day, provided, however, that if
said next succeeding Business Day falls in a new calendar month,
such Interest Period shall end on the immediately preceding
Business Day.
"Investment" of a Person means any loan, advance (other than
commission, travel and similar advances to officers and employees
made in the ordinary course of business), extension of credit
(other than accounts receivable arising in the ordinary course of
business on terms customary in the trade), deposit account or
contribution of capital by such Person to any other Person or any
investment in, or purchase or other acquisition of, the stock,
partnership interests, notes, debentures or other securities or
other indebtedness of any other Person made by such Person.
"Issuance Date" means the date of issuance of a Letter of
Credit.
"KLT Investments" means KLT Investments, Inc., a Missouri
corporation and Wholly-Owned Subsidiary of the Borrower.
"KLT Investments Debt" means Indebtedness incurred by KLT
Investments in connection with the acquisition and maintenance of
its interests (whether direct or indirect) in low-income housing
projects.
"Lenders" means the lending institutions listed on the
signature pages of this Agreement and their respective successors
and assigns.
"Lending Installation" means, with respect to a Lender or
the Agent, any office, branch, subsidiary or affiliate of such
Lender or the Agent.
"Letter of Credit" is defined in Section 2.1.
"Letter of Credit Application" means a letter of credit
application in the form used by Bank One at the applicable time
for the type of Letter of Credit requested.
"Letter of Credit Fee Rate" means, at any time, the
percentage rate per annum at which letter of credit fees are
accruing on the aggregate Stated Amount of all Letters of Credit
at such time as set forth in the Pricing Schedule; and provided
that at any time a Default exists and as long as such Default is
continuing, the Letter of Credit Fee Rate shall be increased by
an additional 2% per annum.
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"Lien" means any lien (statutory or other), security
interest, mortgage, pledge, hypothecation, assignment, deposit
arrangement, encumbrance or preference, priority or other
security agreement or preferential arrangement of any kind or
nature whatsoever (including, without limitation, the interest of
a vendor or lessor under any conditional sale, Capitalized Lease
or other title retention agreement).
"Loan" means, with respect to a Lender, such Lender's
portion of any Advance.
"Loan Documents" means this Agreement, the Notes, the Letter
of Credit Applications and the Collateral Documents.
"Material Adverse Effect" means a material adverse effect on
(i) the business, Property, condition (financial or otherwise),
results of operations, or prospects of the Borrower and its
Subsidiaries taken as a whole, (ii) the ability of the Borrower
to perform its obligations under the Loan Documents, (iii) the
ability of the Parent to perform its obligations under the
Support Agreement or (iv) the validity or enforceability of any
of the Transaction Documents or the rights or remedies of the
Agent or the Lenders thereunder.
"Multiemployer Plan" means a Plan maintained pursuant to a
collective bargaining agreement or any other arrangement to which
the Borrower or any member of the Controlled Group is a party to
which more than one employer is obligated to make contributions.
"Net Worth" means the consolidated tangible net worth of the
Borrower and its Subsidiaries determined in accordance with
Agreement Accounting Principles.
"New Lenders" is defined in Section 9.17.
"Non-Recourse Debt" means Indebtedness which is incurred in
connection with the financing by the Borrower or any Subsidiary
of the acquisition or construction of an asset and (a) is
collateralized by the grant by the Borrower or any Subsidiary of
a security interest in such asset and (b) for which recourse for
non-payment of any such Indebtedness is limited solely to
recourse to such asset (and other Property specifically related
thereto, such as permits, books, records, and contracts) and not
to any other assets of the Borrower or any Subsidiary.
"Note" means a promissory note, in substantially the form of
Exhibit "A" hereto, duly executed by the Borrower and payable to
the order of a Lender in the amount of its Commitment, including
any amendment, modification, renewal or replacement of such
promissory note.
"Notice of Assignment" is defined in Section 12.3.2.
"Obligations" means all unpaid principal of and accrued and
unpaid interest on the Notes, all reimbursement obligations in
respect of Letters of Credit and all interest thereon, and all
accrued and unpaid fees and all expenses, reimbursements,
indemnities and other obligations of
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the Borrower to the Lenders or to any Lender, the Agent or any
indemnified party hereunder arising under the Loan Documents.
"Other Agents" is defined in Section 10.13.
"Parent" means Kansas City Power & Light Company, a Missouri
corporation.
"Participants" is defined in Section 12.2.1.
"Payment Date" means the last day of each March, June,
September, and December.
"PBGC" means the Pension Benefit Guaranty Corporation, or
any successor thereto.
"Permitted Acquisition" means, at any time of determination,
any Acquisition by the Borrower or any Subsidiary in accordance
with the Business Plan which has been approved or consented to by
the board of directors or equivalent governing body of the Person
whose assets or equity interests are to be acquired.
"Person" means any natural person, corporation, firm, joint
venture, partnership, association, enterprise, trust or other
entity or organization, or any government or political
subdivision or any agency, department or instrumentality thereof.
"Plan" means an employee pension benefit plan which is
covered by Title IV of ERISA or subject to the minimum funding
standards under Section 412 of the Code as to which the Borrower
or any member of the Controlled Group may have any liability.
"Pledge Agreement" means a pledge agreement in the form of
Exhibit "C-1" hereto, dated as of April 25, 1995, duly executed
and delivered to the Agent by the Borrower, as the same has been
and may be amended or modified and in effect from time to time.
"Pricing Schedule" means Schedule 4 attached hereto.
"Prior Agreement" is defined in the recitals to this
Agreement.
"Prior Lenders" is defined in the recitals to this
Agreement.
"Property" of a Person means any and all property, whether
real, personal, tangible, intangible, or mixed, of such Person,
or other assets owned, leased or operated by such Person.
"Purchasers" is defined in Section 12.3.1.
"Rate Hedging Obligations" of a Person means any and all
obligations of such Person, whether absolute or contingent and
howsoever and whensoever created, arising, evidenced or acquired
(including all renewals, extensions and modifications thereof and
substitutions
8
therefor), under (i) any and all agreements, devices or
arrangements designed to protect at least one of the parties
thereto from the fluctuations of interest rates, exchange rates
or forward rates applicable to such party's assets, liabilities
or exchange transactions, including, but not limited to,
dollar-denominated or cross-currency interest rate exchange
agreements, forward currency exchange agreements, interest rate
cap or collar protection agreements, forward rate currency or
interest rate options, puts and warrants, and (ii) any and all
cancellations, buy backs, reversals, terminations or assignments
of any of the foregoing.
"Regulation D" means Regulation D of the Board of Governors
of the Federal Reserve System as from time to time in effect and
any successor thereto or other regulation or official
interpretation of said Board of Governors relating to reserve
requirements applicable to member banks of the Federal Reserve
System.
"Regulation U" means Regulation U of the Board of Governors
of the Federal Reserve System as from time to time in effect and
any successor or other regulation or official interpretation of
said Board of Governors relating to the extension of credit by
banks for the purpose of purchasing or carrying margin stocks
applicable to member banks of the Federal Reserve System.
"Rentals" of a Person means the aggregate fixed amounts
payable by such Person under any lease of Property having an
original term (including any required renewals or any renewals at
the option of the lessor or lessee) of one year or more, but does
not include any amounts payable under Capitalized Leases of such
Person.
"Reportable Event" means a reportable event as defined in
Section 4043 of ERISA and the regulations issued under such
section, with respect to a Plan, excluding, however, such events
as to which the PBGC by regulation waived the requirement of
Section 4043(a) of ERISA that it be notified within 30 days of
the occurrence of such event, provided, however, that a failure
to meet the minimum funding standard of Section 412 of the Code
and of Section 302 of ERISA shall be a Reportable Event
regardless of the issuance of any such waiver of the notice
requirement in accordance with either Section 4043(a) of ERISA or
Section 412(d) of the Code.
"Required Lenders" means Lenders in the aggregate having at
least 66-2/3% of the Aggregate Commitment or, if the Aggregate
Commitment has been terminated, Lenders in the aggregate holding
at least 66-2/3% of the aggregate unpaid principal amount of the
outstanding Advances.
"Reserve Requirement" means, with respect to an Interest
Period, the maximum aggregate reserve requirement (including all
basic, supplemental, marginal and other reserves) which is
imposed under Regulation D on Eurocurrency liabilities.
"Restatement Date" means the day on which (a) the Borrower,
the Agent and the Lenders have executed this Agreement and (b)
the Borrower has satisfied all of the terms and conditions of
Section 4.1.
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"Section" means a numbered section of this Agreement, unless
another document is specifically referenced.
"Single Employer Plan" means a Plan maintained by the
Borrower or any member of the Controlled Group for employees of
the Borrower or any member of the Controlled Group.
"Single-Project Subsidiary" means a Subsidiary (a) formed
and maintained solely for the purpose of a single project and (b)
in respect of the Indebtedness of which the Borrower and the
other Subsidiaries shall have no economic liability other than
their respective Investments in such Subsidiary.
"Single-Project Subsidiary Debt " means Indebtedness of a
Single-Project Subsidiary.
"Stated Amount" means, with respect to any Letter of Credit
at any date of determination, the maximum aggregate amount
available for drawing thereunder at any time during the then
ensuing term of such Letter of Credit under any and all
circumstances, plus the aggregate amount of all unreimbursed
payments and disbursements under such Letter of Credit.
"Subsidiary" of a Person means (i) any corporation more than
50% of the outstanding securities having ordinary voting power of
which shall at the time be owned or controlled, directly or
indirectly, by such Person or by one or more of its Subsidiaries
or by such Person and one or more of its Subsidiaries, or (ii)
any partnership, association, joint venture or similar business
organization more than 50% of the ownership interests having
ordinary voting power of which shall at the time be so owned or
controlled. Unless otherwise expressly provided, all references
herein to a "Subsidiary" shall mean a Subsidiary of the Borrower.
"Substantial Portion" means, with respect to the Property of
the Borrower and its Subsidiaries, Property which (i) represents
more than 10% of the consolidated assets of the Borrower and its
Subsidiaries as would be shown in the consolidated financial
statements of the Borrower and its Subsidiaries as at the
beginning of the twelve-month period ending with the month in
which such determination is made, or (ii) is responsible for more
than 10% of the consolidated net sales or of the consolidated net
income of the Borrower and its Subsidiaries as reflected in the
financial statements referred to in clause (i) above.
"Support Agreement" means that certain Support Agreement in
the form of Exhibit "B" attached hereto dated as of June 30, 2000
by and between Kansas City Power & Light Company and the Borrower
for the benefit of the Agent and the Lenders, as it may be
amended or modified and in effect from time to time.
"Transaction Documents" means the Loan Documents and the
Support Agreement.
"Transferee" is defined in Section 12.4.
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"Type" means, with respect to any Advance, its nature as a
Floating Rate Advance or Eurodollar Advance.
"Unfunded Liabilities" means the amount (if any) by which
the present value of all vested nonforfeitable benefits under all
Single Employer Plans exceeds the fair market value of all such
Plan assets allocable to such benefits, all determined as of the
then most recent valuation date for such Plans.
"Unmatured Default" means an event which but for the lapse
of time or the giving of notice, or both, would constitute a
Default.
"Wholly-Owned Subsidiary" of a Person means (i) any
Subsidiary all of the outstanding voting securities of which
shall at the time be owned or controlled, directly or indirectly,
by such Person or one or more Wholly-Owned Subsidiaries of such
Person, or by such Person and one or more Wholly-Owned
Subsidiaries of such Person, or (ii) any partnership,
association, joint venture or similar business organization 100%
of the ownership interests having ordinary voting power of which
shall at the time be so owned or controlled.
The foregoing definitions shall be equally applicable to
both the singular and plural forms of the defined terms.
ARTICLE II
THE CREDITS
2.1. Commitment. From and including the date of this
Agreement and prior to the Facility Termination Date (a) each
Lender severally agrees, on the terms and conditions set forth in
this Agreement, to make Loans to the Borrower from time to time
in amounts not to exceed in the aggregate at any one time
outstanding the amount of its Commitment and (b) Bank One agrees
to issue standby letters of credit, in each case containing such
terms and conditions as are permitted by this Agreement and are
reasonably satisfactory to Bank One (each a "Letter of Credit"),
at the request of and for the account of the Borrower from time
to time before the Facility Termination Date and, as more fully
set forth in Section 2.20, each Lender agrees to purchase a
participation in each such Letter of Credit; provided that (i)
the sum of the aggregate principal amount of all outstanding
Loans plus the aggregate Stated Amount of all Letters of Credit
shall not at any time exceed the Aggregate Commitment and (ii)
the aggregate Stated Amount of all Letters of Credit shall not at
any time exceed $10,000,000. Subject to the terms of this
Agreement, the Borrower may borrow, repay and reborrow at any
time prior to the Facility Termination Date. The Commitments
shall expire on the Facility Termination Date.
2.2. Required Payments; Termination. Any outstanding
Advances and all other unpaid Obligations shall be paid in full
by the Borrower on the Facility Termination Date.
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2.3. Ratable Loans. Each Advance hereunder shall consist of
Loans made from the several Lenders ratably in proportion to the
ratio that their respective Commitments bear to the Aggregate
Commitment.
2.4. Types of Advances. The Advances may be Floating Rate
Advances or Eurodollar Advances, or a combination thereof,
selected by the Borrower in accordance with Sections 2.8 and 2.9,
provided that notwithstanding anything contained in this
Agreement to the contrary, any Advance which is made under a
Letter of Credit shall at all times be deemed to be a Floating
Rate Advance.
2.5. Facility and Letter of Credit Fees; Reductions in
Aggregate Commitment. The Borrower agrees to pay to the Agent
for the account of each Lender from the Restatement Date to and
including the Facility Termination Date (or such later date on
which all Loans have been paid and all Letters of Credit have
expired or been otherwise terminated) (a) a facility fee at a per
annum rate equal to the applicable Facility Fee Rate on the
average daily amount of such Lender's Commitment, regardless of
usage, and (b) a letter of credit fee for each Letter of Credit
at a per annum rate equal to the applicable Letter of Credit Fee
Rate on the Stated Amount of each such Letter of Credit. Each
fee referred to in the foregoing sentence shall be payable on
each Payment Date hereafter, on the Facility Termination Date and
thereafter on demand. In addition, with respect to each Letter
of Credit, the Borrower agrees to pay Bank One, for its own
account, (i) such fees and expenses as Bank One customarily
requires in connection with the issuance, negotiation, processing
and/or administration of letters of credit in similar situations
and (ii) a fronting fee in the amount separately agreed to by the
Borrower and Bank One. The Borrower may permanently reduce the
Aggregate Commitment in whole, or in part ratably among the
Lenders in integral multiples of $1,000,000, upon at least ten
Business Days' written notice to the Agent, which notice shall
specify the amount of any such reduction, provided, however, that
the amount of the Aggregate Commitment may not be reduced below
the aggregate principal amount of the outstanding Advances. All
accrued facility fees and letter of credit fees shall be payable
on the effective date of any termination of the obligations of
the Lenders to make Loans hereunder.
2.6. Minimum Amount of Each Advance. Each Eurodollar
Advance shall be in the minimum amount of $1,000,000 (and in
multiples of $500,000 if in excess thereof), and each Floating
Rate Advance shall be in the minimum amount of $1,000,000 (and in
multiples of $500,000 if in excess thereof), provided, however,
that any Floating Rate Advance may be in the amount of the unused
Aggregate Commitment.
2.7. Optional Principal Payments. The Borrower may from
time to time pay, without penalty or premium, all outstanding
Floating Rate Advances, or, in a minimum aggregate amount of
$1,000,000 or any integral multiple of $500,000 in excess
thereof, any portion of the outstanding Floating Rate Advances
upon two Business Days' prior notice to the Agent. A Eurodollar
Advance may not be paid prior to the last day of the applicable
Interest Period.
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2.8. Method of Selecting Types and Interest Periods for New
Advances. The Borrower shall select the Type of Advance and, in
the case of each Eurodollar Advance, the Interest Period
applicable to each Advance from time to time. The Borrower shall
give the Agent irrevocable notice (a "Borrowing Notice") not
later than 10:00 a.m. (Chicago time) at least one Business Day
before the Borrowing Date of each Floating Rate Advance and three
Business Days before the Borrowing Date for each Eurodollar
Advance, specifying:
(i) the Borrowing Date, which shall be a Business Day, of
such Advance,
(ii) the aggregate amount of such Advance,
(iii) the Type of Advance selected, and
(iv) in the case of each Eurodollar Advance, the Interest
Period applicable thereto.
Not later than noon (Chicago time) on each Borrowing Date, each
Lender shall make available its Loan or Loans, in funds
immediately available in Chicago to the Agent at its address
specified pursuant to Article XIII. The Agent will promptly make
the funds so received from the Lenders available to the Borrower
at the Agent's aforesaid address.
2.9. Conversion and Continuation of Outstanding
Advances. Floating Rate Advances shall continue as Floating Rate
Advances unless and until such Floating Rate Advances are
converted into Eurodollar Advances. Each Eurodollar Advance of
any Type shall continue as a Eurodollar Advance of such Type
until the end of the then applicable Interest Period therefor, at
which time such Eurodollar Advance shall be automatically
converted into a Floating Rate Advance unless the Borrower shall
have given the Agent a Conversion/Continuation Notice requesting
that, at the end of such Interest Period, such Eurodollar Advance
either continue as a Eurodollar Advance of such Type for the same
or another Interest Period or be converted into an Advance of
another Type. Subject to the terms of Section 2.6, the Borrower
may elect from time to time to convert all or any part of an
Advance of any Type into any other Type or Types of Advances;
provided that any conversion of any Eurodollar Advance shall be
made on, and only on, the last day of the Interest Period
applicable thereto. The Borrower shall give the Agent
irrevocable notice (a "Conversion/Continuation Notice") of each
conversion of an Advance or continuation of a Eurodollar Advance
not later than 10:00 a.m. (Chicago time) at least one Business
Day, in the case of a conversion into a Floating Rate Advance, or
three Business Days, in the case of a conversion into or
continuation of a Eurodollar Advance, prior to the date of the
requested conversion or continuation, specifying:
(i) the requested date which shall be a Business Day, of
such conversion or continuation;
(ii) the aggregate amount and Type of the Advance which is
to be converted or continued; and
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(iii) the amount and Type(s) of Advance(s) into which
such Advance is to be converted or continued and, in
the case of a conversion into or continuation of a
Eurodollar Advance, the duration of the Interest Period
applicable thereto.
2.10. Changes in Interest Rate, etc. Each Floating Rate
Advance shall bear interest on the outstanding principal amount
thereof, for each day from and including the date such Advance is
made or is converted from a Eurodollar Advance into a Floating
Rate Advance pursuant to Section 2.9 to but excluding the date it
becomes due or is converted into a Eurodollar Advance pursuant to
Section 2.9 hereof, at a rate per annum equal to the Floating
Rate for such day. Changes in the rate of interest on that
portion of any Advance maintained as a Floating Rate Advance will
take effect simultaneously with each change in the Alternate Base
Rate. Each Eurodollar Advance shall bear interest from and
including the first day of the Interest Period applicable thereto
to (but not including) the last day of such Interest Period at
the interest rate determined as applicable to such Eurodollar
Advance. No Interest Period may end after the Facility
Termination Date.
2.11. Rates Applicable After Default. Notwithstanding
anything to the contrary contained in Section 2.8 or 2.9, during
the continuance of a Default or Unmatured Default the Required
Lenders may, at their option, by notice to the Borrower (which
notice may be revoked at the option of the Required Lenders
notwithstanding any provision of Section 8.2 requiring unanimous
consent of the Lenders to changes in interest rates), declare
that no Advance may be made as, converted into or continued as a
Eurodollar Advance. During the continuance of a Default the
Required Lenders may, at their option, by notice to the Borrower
(which notice may be revoked at the option of the Required
Lenders notwithstanding any provision of Section 8.2 requiring
unanimous consent of the Lenders to changes in interest rates),
declare that (i) each Eurodollar Advance shall bear interest for
the remainder of the applicable Interest Period at the rate
otherwise applicable to such Interest Period plus 2% per annum
and (ii) each Floating Rate Advance shall bear interest at a rate
per annum equal to the Floating Rate otherwise applicable to the
Floating Rate Advance plus 2% per annum.
2.12. Method of Payment. All payments of the
Obligations hereunder shall be made, without setoff, deduction,
counterclaim, or (with respect to each affected Lender that
complies with Section 2.18) withholding, in immediately available
funds to the Agent at the Agent's address specified pursuant to
Article XIII, or at any other Lending Installation of the Agent
specified in writing by the Agent to the Borrower, by noon (local
time) on the date when due and shall be applied ratably by the
Agent among the Lenders. Each payment delivered to the Agent for
the account of any Lender shall be delivered promptly by the
Agent to such Lender in the same type of funds that the Agent
received at its address specified pursuant to Article XIII or at
any Lending Installation specified in a notice received by the
Agent from such Lender. The Agent is hereby authorized to charge
the account of the Borrower maintained with Bank One for each
payment of principal, interest and fees as it becomes due
hereunder.
2.13. Notes; Telephonic Notices. Each Lender is hereby
authorized to record the principal amount of each of its Loans
and each repayment on the schedule attached to its Note,
14
provided, however, that the failure to so record shall not affect
the Borrower's obligations under such Note. The Borrower hereby
authorizes the Lenders and the Agent to extend, convert or
continue Advances, effect selections of Types of Advances and to
transfer funds based on telephonic notices made by any person or
persons the Agent or any Lender in good faith believes to be
acting on behalf of the Borrower. The Borrower agrees to deliver
promptly to the Agent a written confirmation, if such
confirmation is requested by the Agent or any Lender, of each
telephonic notice signed by an Authorized Officer. If the
written confirmation differs in any material respect from the
action taken by the Agent and the Lenders, the records of the
Agent and the Lenders shall govern absent manifest error.
2.14. Interest Payment Dates; Interest and Fee Basis.
Interest accrued on each Floating Rate Advance shall be payable
on each Payment Date, commencing with the first such date to
occur after the date hereof, on any date on which the Floating
Rate Advance is prepaid, whether due to acceleration or
otherwise, and at maturity. Interest accrued on that portion of
the outstanding principal amount of any Floating Rate Advance
converted into a Eurodollar Advance on a day other than a Payment
Date shall be payable on the date of conversion. Interest
accrued on each Eurodollar Advance shall be payable on the last
day of its applicable Interest Period, on any date on which the
Eurodollar Advance is prepaid, whether by acceleration or
otherwise, and at maturity. Interest accrued on each Eurodollar
Advance having an Interest Period longer than three months shall
also be payable on the last day of each three-month interval
during such Interest Period. Interest on Eurodollar Advances and
facility fees shall be calculated for actual days elapsed on the
basis of a 360-day year. Interest on Floating Rate Loans shall
be calculated for actual days elapsed on the basis of a 365, or
when appropriate 366, day year. Interest shall be payable for
the day an Advance is made but not for the day of any payment on
the amount paid if payment is received prior to noon (local time)
at the place of payment. If any payment of principal of or
interest on an Advance shall become due on a day which is not a
Business Day, such payment shall be made on the next succeeding
Business Day and, in the case of a principal payment, such
extension of time shall be included in computing interest in
connection with such payment.
2.15. Notification of Advances, Interest Rates,
Prepayments and Commitment Reductions. Promptly after receipt
thereof, the Agent will notify each Lender of the contents of
each Aggregate Commitment reduction notice, Borrowing Notice,
Conversion/Continuation Notice, and repayment notice received by
it hereunder. The Agent will notify each Lender of the interest
rate applicable to each Eurodollar Advance promptly upon
determination of such interest rate and will give each Lender
prompt notice of each change in the Alternate Base Rate.
2.16. Lending Installations. Each Lender may book its
Loans at any Lending Installation selected by such Lender and may
change its Lending Installation from time to time. All terms of
this Agreement shall apply to any such Lending Installation and
the Notes shall be deemed held by each Lender for the benefit of
such Lending Installation. Each Lender may, by written or telex
notice to the Agent and the Borrower, designate a Lending
Installation through which Loans will be made by it and for whose
account Loan payments are to be made.
15
2.17. Non-Receipt of Funds by the Agent. Unless the
Borrower or a Lender, as the case may be, notifies the Agent
prior to the date on which it is scheduled to make payment to the
Agent of (i) in the case of a Lender, the proceeds of a Loan or
(ii) in the case of the Borrower, a payment of principal,
interest or fees to the Agent for the account of the Lenders,
that it does not intend to make such payment, the Agent may
assume that such payment has been made. The Agent may, but shall
not be obligated to, make the amount of such payment available to
the intended recipient in reliance upon such assumption. If such
Lender or the Borrower, as the case may be, has not in fact made
such payment to the Agent, the recipient of such payment shall,
on demand by the Agent, repay to the Agent the amount so made
available together with interest thereon in respect of each day
during the period commencing on the date such amount was so made
available by the Agent until the date the Agent recovers such
amount at a rate per annum equal to (i) in the case of payment by
a Lender, the Federal Funds Effective Rate for such day or (ii)
in the case of payment by the Borrower, the interest rate
applicable to the relevant Loan.
2.18. Withholding Tax Exemption. At least five Business
Days prior to the first date on which interest or fees are
payable hereunder for the account of any Lender, each Lender that
is not incorporated under the laws of the United States of
America, or a state thereof, agrees that it will deliver to each
of the Borrower and the Agent two duly completed copies of United
States Internal Revenue Service Form 1001 or 4224, certifying in
either case that such Lender is entitled to receive payments
under this Agreement and its Note without deduction or
withholding of any United States federal income taxes. Each
Lender which so delivers a Form 1001 or 4224 further undertakes
to deliver to each of the Borrower and the Agent two additional
copies of such form (or a successor form) on or before the date
that such form expires (currently, three successive calendar
years for Form 1001 and one calendar year for Form 4224) or
becomes obsolete or after the occurrence of any event requiring a
change in the most recent forms so delivered by it, and such
amendments thereto or extensions or renewals thereof as may be
reasonably requested by the Borrower or the Agent, in each case
certifying that such Lender is entitled to receive payments under
this Agreement and its Note without deduction or withholding of
any United States federal income taxes, unless an event
(including without limitation any change in treaty, law or
regulation) has occurred prior to the date on which any such
delivery would otherwise be required which renders all such forms
inapplicable or which would prevent such Lender from duly
completing and delivering any such form with respect to it and
such Lender advises the Borrower and the Agent that it is not
capable of receiving payments without any deduction or
withholding of United States federal income tax.
2.19 Letter of Credit Procedures. The Borrower shall give
notice to Bank One of the proposed issuance of each Letter of
Credit on a Business Day which is at least two Business Days
prior to the proposed date of issuance of such Letter of Credit.
Each such notice shall be accompanied by a Letter of Credit
Application, duly executed by the Borrower and in all respects
reasonably satisfactory to Bank One, together with such other
documentation as Bank One may reasonably request in support
thereof, it being understood that each Letter of Credit
Application shall specify, among other things, the date on with
the proposed Letter of Credit is to be issued, the expiration
date of such Letter of Credit (which shall not be later than the
Facility Termination Date unless the Borrower shall have pledged
cash collateral to the Agent
16
therefor in an amount, and pursuant to documentation, reasonably
satisfactory to the Required Lenders and the Agent) and whether
such Letter of Credit is to be transferable in whole or in part.
Subject to the satisfaction of the conditions precedent set forth
in Section 4 with respect to the issuance of such Letter of
Credit, Bank One shall issue such Letter of Credit on the
requested issuance date.
2.20 Participations in Letters of Credit. Concurrently with
the issuance of each Letter of Credit, Bank One shall be deemed
to have sold and transferred to each other Lender, and each other
Lender shall be deemed irrevocably and unconditionally to have
purchased and received from Bank One, without recourse or
warranty, an undivided interest and participation, to the extent
of such other Lender's pro rata share (according to its
Commitment) in such Letter of Credit and the Borrower's
reimbursement obligations with respect thereto. For the purposes
of this Agreement, the unparticipated portion of each Letter of
Credit shall be deemed to be Bank One's "participation" therein.
Bank One hereby agrees, upon request of any Lender, to deliver to
such Lender a list of all outstanding Letters of Credit, together
with such information related thereto as such other Lender may
reasonably request.
2.21 Reimbursement Obligations; Repayment From Loans.
Notwithstanding anything contained in this Agreement to the
contrary, the Borrower hereby unconditionally and irrevocably
agrees to reimburse Bank One for each payment or disbursement
made by Bank One under any Letter of Credit honoring any demand
for payment made by the beneficiary thereunder, in each case on
the date that such payment or disbursement is made. If the
Borrower fails to reimburse Bank One for any payment or
disbursement prior to noon, Chicago time, on the date of such
payment or disbursement, the Agent will promptly notify each
Lender that the Borrower is deemed to have requested that Loans
consisting of Floating Rate Loans be made by the Lenders on such
day to repay the Borrower's reimbursement obligations under such
Letter of Credit. Subject to the conditions set forth in Section
4.2, each Lender shall be obligated to promptly make its pro rata
share (according to its Commitment) of the amount so deemed
requested by the Borrower available to the Agent, for application
to the Borrower's reimbursement obligations under the applicable
Letter of Credit (and the provisions of the last two sentences of
Section 2.23 shall be applicable to each Lender's obligation to
make such Loan). Any amount not reimbursed on the date of a
payment or disbursement under a Letter of Credit (by the making
of Loans or otherwise) shall bear interest from and including the
date of such payment or disbursement to but not including the
date that Bank One is reimbursed by the Borrower therefor,
payable on demand, at a rate per annum equal to the sum of the
Alternate Base Rate from time to time in effect (plus, beginning
on the first Business Day after demand by Bank One, 2% per
annum). Bank One shall notify the Borrower whenever any demand
for payment is made under any Letter of Credit by the beneficiary
thereunder; provided that the failure of Bank One to so notify
the Borrower shall not affect the rights of Bank One or the
Lenders in any manner whatsoever.
2.22 Limitation on Bank One's Obligations. In determining
whether to pay under any Letter of Credit, Bank One shall have no
obligation to the Borrower or any Lender other than to confirm
that any documents required to be delivered under such Letter of
Credit appear to have
17
been delivered and appear to comply on their face with the
requirements of such Letter of Credit. Any action taken or
omitted to be taken by Bank One under or in connection with any
Letter of Credit, if taken or omitted in the absence of gross
negligence and willful misconduct, shall not impose upon Bank One
any liability to the Borrower or any Lender and shall not reduce
or impair the Borrower's reimbursement obligations set forth in
Section 2.21 or the obligations of the Lenders pursuant to
Section 2.23.
2.23 Funding by Lenders to Bank One. If (i) Bank One makes
any payment or disbursement under any Letter of Credit and the
Borrower has not reimbursed Bank One in full for such payment or
disbursement by noon, Chicago time, on the date of such payment
or disbursement and any condition precedent to making Loans to
reimburse Bank One for such payment or disbursement has not been
satisfied or (ii) if any reimbursement received by Bank One from
the Borrower is or must be returned or rescinded upon or during
any bankruptcy or reorganization of the Borrower or otherwise,
each other Lender shall be obligated to pay to Bank One, in full
or partial payment of the purchase price of its participation in
such Letter of Credit, its pro rata share (according to its
Commitment) of such payment or disbursement (but no such payment
shall diminish the obligations of the Borrower under
Section 2.21), and the Agent shall promptly notify each other
Lender thereof. Each other Lender irrevocably and
unconditionally agrees, severally and for itself alone, to so pay
to the Agent in immediately available funds for Bank One's
account the amount of such other Lender's pro rata share of such
payment or disbursement. If and to the extent any Lender shall
not have made such amount (or the amount of its Loan as described
in Section 2.21) available to the Agent by 2:00 p.m., Chicago
time, on the Business Day on which such Lender receives notice
from the Agent of such payment or disbursement (it being
understood that any such notice received after 12:30 p.m.,
Chicago time, on any Business Day shall be deemed to have been
received on the immediately following Business Day), such Lender
agrees to pay interest on such amount to the Agent for Bank One's
account forthwith on demand for each day from and including the
date such amount was to have been delivered to the Agent to but
excluding the date such amount is paid, at a rate per annum equal
to (a) for the first three days after demand, the Federal Funds
Rate from time to time in effect and (b) thereafter, the
Alternate Base Rate from time to time in effect (together with
such other compensatory amounts as may be required to be paid by
such Lender to the Agent pursuant to the Rules for Interbank
Compensation of the Council on International Banking or the
Clearinghouse Compensation Committee, as applicable, as in effect
from time to time). Any Lender's failure to make available to
the Agent its pro rata share of any such payment or disbursement
shall not relieve any other Lender of its obligation hereunder to
make available to the Agent such other Lender's pro rata share of
such payment, but no Lender shall be responsible for the failure
of any other Lender to make available to the Agent such other
Lender's pro rata share of any such payment or disbursement.
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ARTICLE III
CHANGE IN CIRCUMSTANCES
3.1. Yield Protection. If any law or any governmental
or quasi-governmental rule, regulation, policy, guideline or
directive (whether or not having the force of law), or any
interpretation thereof, or the compliance of any Lender
therewith,
(i) subjects any Lender or any applicable Lending
Installation to any tax, duty, charge or withholding on
or from payments due from the Borrower (excluding
federal taxation of the overall net income of any
Lender or applicable Lending Installation), or changes
the basis of taxation of payments to any Lender in
respect of its Loans or other amounts due it hereunder,
or
(ii) imposes or increases or deems applicable any reserve,
assessment, insurance charge, special deposit or
similar requirement against assets of, deposits with or
for the account of, or credit extended by, any Lender
or any applicable Lending Installation (other than
reserves and assessments taken into account in
determining the interest rate applicable to Eurodollar
Advances), or
(iii) imposes any other condition the result of which is
to increase the cost to any Lender or any applicable
Lending Installation of making, funding or maintaining
loans or reduces any amount receivable by any Lender or
any applicable Lending Installation in connection with
loans, or requires any Lender or any applicable Lending
Installation to make any payment calculated by
reference to the amount of loans held or interest
received by it, by an amount deemed material by such
Lender,
then, within 15 days of demand by such Lender, the Borrower shall
pay such Lender that portion of such increased expense incurred
or reduction in an amount received which such Lender determines
is attributable to making, funding and maintaining its Loans and
its Commitment.
3.2. Changes in Capital Adequacy Regulations. If a
Lender determines the amount of capital required or expected to
be maintained by such Lender, any Lending Installation of such
Lender or any corporation controlling such Lender is increased as
a result of a Change, then, within 15 days of demand by such
Lender, the Borrower shall pay such Lender the amount necessary
to compensate for any shortfall in the rate of return on the
portion of such increased capital which such Lender determines is
attributable to this Agreement, its Loans or its obligation to
make Loans hereunder (after taking into account such Lender's
policies as to capital adequacy). "Change" means (i) any change
after the date of this Agreement in the Risk-Based Capital
Guidelines or (ii) any adoption of or change in any other law,
governmental or quasi-governmental rule, regulation, policy,
guideline, interpretation, or directive (whether or not having
the force of law) after the date of this Agreement which affects
the amount of capital
19
required or expected to be maintained by any Lender or any
Lending Installation or any corporation controlling any Lender.
"Risk-Based Capital Guidelines" means (i) the risk-based capital
guidelines in effect in the United States on the date of this
Agreement, including transition rules, and (ii) the corresponding
capital regulations promulgated by regulatory authorities outside
the United States implementing the July 1988 report of the Basle
Committee on Banking Regulation and Supervisory Practices
Entitled "International Convergence of Capital Measurements and
Capital Standards," including transition rules, and any
amendments to such regulations adopted prior to the date of this
Agreement.
3.3. Availability of Types of Advances. If any Lender
determines that maintenance of its Eurodollar Loans at a suitable
Lending Installation would violate any applicable law, rule,
regulation, or directive, whether or not having the force of law,
or if the Required Lenders determine that (i) deposits of a type
and maturity appropriate to match fund Eurodollar Advances are
not available or (ii) the interest rate applicable to a Type of
Advance does not accurately reflect the cost of making or
maintaining such Advance, then the Agent shall suspend the
availability of the affected Type of Advance and require any
Eurodollar Advances of the affected Type to be repaid.
3.4. Funding Indemnification. If any payment of a
Eurodollar Advance occurs on a date which is not the last day of
the applicable Interest Period, whether because of acceleration,
prepayment or otherwise, or a Eurodollar Advance is not made on
the date specified by the Borrower for any reason other than
default by the Lenders, the Borrower will indemnify each Lender
for any loss or cost incurred by it resulting therefrom,
including, without limitation, any loss or cost in liquidating or
employing deposits acquired to fund or maintain the Eurodollar
Advance.
3.5. Lender Statements; Survival of Indemnity. To the
extent reasonably possible, each Lender shall designate an
alternate Lending Installation with respect to its Eurodollar
Loans to reduce any liability of the Borrower to such Lender
under Sections 3.1 and 3.2 or to avoid the unavailability of a
Type of Advance under Section 3.3, so long as such designation is
not disadvantageous to such Lender. Each Lender shall deliver a
written statement of such Lender as to the amount due, if any,
under Sections 3.1, 3.2 or 3.4. Such written statement shall set
forth in reasonable detail the calculations upon which such
Lender determined such amount and shall be final, conclusive and
binding on the Borrower in the absence of manifest error.
Determination of amounts payable under such Sections in
connection with a Eurodollar Loan shall be calculated as though
each Lender funded its Eurodollar Loan through the purchase of a
deposit of the type and maturity corresponding to the deposit
used as a reference in determining the Eurodollar Base Rate
applicable to such Loan, whether in fact that is the case or not.
Unless otherwise provided herein, the amount specified in the
written statement shall be payable on demand after receipt by the
Borrower of the written statement. The obligations of the
Borrower under Sections 3.1, 3.2 and 3.4 shall survive payment of
the Obligations and termination of this Agreement.
20
ARTICLE IV
CONDITIONS PRECEDENT
4.1. Conditions Precedent to Effectiveness. This
Agreement shall become effective on the date on which (a) the
Borrower has paid to the Agent, for the account of the Lenders,
the up-front fees previously agreed to between the Borrower and
the Lenders, (b) the Borrower has paid all fees, costs and
expenses due and payable pursuant to Sections 9.7 and 10.12 (to
the extent then billed), (c) the Borrower has paid all principal,
interest and fees outstanding under the Prior Agreement and (d)
the Borrower has furnished to the Agent with sufficient copies
for the Lenders:
(i) Copies of the articles of incorporation of the
Borrower, together with all amendments, and a
certificate of good standing, both certified by the
appropriate governmental officer in its jurisdiction of
incorporation.
(ii) Copies, certified by the Secretary or Assistant
Secretary of the Borrower, of its by-laws and of its
Board of Directors' resolutions (and resolutions of
other bodies, if any are deemed necessary by counsel
for any Lender) authorizing the execution of the Loan
Documents.
(iii) An incumbency certificate, executed by the
Secretary or Assistant Secretary of the Borrower, which
shall identify by name and title and bear the signature
of the officers of the Borrower authorized to sign the
Loan Documents and to make borrowings hereunder, upon
which certificate the Agent and the Lenders shall be
entitled to rely until informed of any change in
writing by the Borrower.
(iv) Copies, certified by the Secretary of Parent, of the
articles of incorporation of the Parent, together with
all amendments, and a certificate of good standing,
certified by the appropriate governmental officer in
its jurisdiction of incorporation.
(v) Copies, certified by the Secretary or Assistant
Secretary of the Parent, of its by-laws, and of its
Board of Directors' resolutions (to the extent required
by law or the Parent's constituent documents), and
resolutions of other bodies, if any are deemed
necessary by counsel for any Lender, authorizing the
delegation of authority sufficient for the execution of
the Support Agreement.
(vi) An incumbency certificate, executed by the Secretary or
Assistant Secretary of the Parent, which shall identify
by name and title and bear the signature of the
officers of the Parent authorized to sign the Support
Agreement, upon which certificate the Agent and the
Lenders shall be entitled to rely until informed of any
change in writing by the Parent.
21
(vii) A certificate, signed by the President, or Vice
President and Chief Financial Officer of the Borrower,
stating that on the Restatement Date no Default or
Unmatured Default has occurred and is continuing.
(viii) Written opinions of counsel to the Borrower and
the Parent, addressed to the Lenders in substantially
the forms of Exhibits "D-1" and "D-2" hereto,
respectively.
(ix) Notes payable to the order of each of the Lenders.
(x) The Support Agreement.
(xi) A Confirmation of Pledge Agreement in substantially the
form of Exhibit C-2.
(xii) The Business Plan, together with detailed
projections in form and substance satisfactory to the
Lenders.
(xiii) Written money transfer instructions, in
substantially the form of Exhibit "G" hereto, addressed
to the Agent and signed by an Authorized Officer,
together with such other related money transfer
authorizations as the Agent may have reasonably
requested.
(xiv) The insurance certificate described in Section 5.17.
(xv) Such other documents as any Lender or its counsel may
have reasonably requested.
4.2. Each Advance. The Lenders shall not be required
to make any Advance (other than an Advance that, after giving
effect thereto and to the application of the proceeds thereof,
does not increase the aggregate amount of outstanding Advances),
and Bank One shall not be required to issue any Letter of Credit,
unless on the applicable Borrowing Date or Issuance Date:
(i) There exists no Default or Unmatured Default.
(ii) The representations and warranties contained in Article
V are true and correct as of such Borrowing Date or
Issuance Date, as the case may be, except to the extent
any such representation or warranty is stated to relate
solely to an earlier date, in which case such
representation or warranty shall be true and correct on
and as of such earlier date.
(iii) All legal matters incident to the making of such
Advance or the issuance of such Letter of Credit shall
be satisfactory to the Lenders and their counsel.
22
Each Borrowing Notice with respect to each such Advance and
each request by the Borrower for the issuance of a Letter of
Credit shall constitute a representation and warranty by the
Borrower that the conditions contained in Sections 4.2(i) and
(ii) have been satisfied. Any Lender may require a duly
completed compliance certificate in substantially the form of
Exhibit "E" hereto as a condition to making an Advance or the
issuance of a Letter of Credit.
ARTICLE V
REPRESENTATIONS AND WARRANTIES
The Borrower represents and warrants to the Lenders that:
5.1. Corporate Existence and Standing. Each of the
Borrower and its Subsidiaries is a corporation or limited
liability company duly incorporated or organized, validly
existing and in good standing under the laws of its jurisdiction
of incorporation or organization and has all requisite authority
to conduct its business in each jurisdiction in which its
business is conducted, provided that a Subsidiary shall not be
required to comply with this Section 5.1 so long as such
noncompliance will not, at any time, result in a Material Adverse
Effect.
5.2. Authorization and Validity. The Borrower has the
corporate power and authority and legal right to execute and
deliver the Loan Documents and to perform its obligations
thereunder. The execution and delivery by the Borrower of the
Loan Documents and the performance of its obligations thereunder
have been duly authorized by proper corporate proceedings, and
the Loan Documents constitute legal, valid and binding
obligations of the Borrower enforceable against the Borrower in
accordance with their terms, except as enforceability may be
limited by bankruptcy, insolvency or similar laws affecting the
enforcement of creditors' rights generally.
5.3. No Conflict; Government Consent. Neither the
execution and delivery by the Borrower of the Loan Documents, nor
the consummation of the transactions therein contemplated, nor
compliance with the provisions thereof will violate any law,
rule, regulation, order, writ, judgment, injunction, decree or
award binding on the Borrower or any of its Subsidiaries or the
Borrower's or any Subsidiary's articles of incorporation or
by-laws or the provisions of any indenture, instrument or
agreement to which the Borrower or any of its Subsidiaries is a
party or is subject, or by which it, or its Property, is bound,
or conflict with or constitute a default thereunder, or result in
the creation or imposition of any Lien in, of or on the Property
of the Borrower or a Subsidiary pursuant to the terms of any such
indenture, instrument or agreement. No order, consent, approval,
license, authorization, or validation of, or filing, recording or
registration with, or exemption by, any governmental or public
body or authority, or any subdivision thereof, is required to
authorize, or is required in connection with the execution,
delivery and performance of, or the legality, validity, binding
effect or enforceability of, any of the Loan Documents.
23
5.4. Financial Statements. The December 31, 1999
consolidated financial statements of the Borrower and its
Subsidiaries heretofore delivered to the Lenders were prepared in
accordance with Agreement Accounting Principles and fairly
present the consolidated financial condition and operations of
the Borrower and its Subsidiaries at such date and the
consolidated results of their operations for the period then
ended.
5.5. Material Adverse Change. Since December 31, 1999,
there has been no change in the business, Property, prospects,
condition (financial or otherwise) or results of operations of
the Borrower and its Subsidiaries which could reasonably be
expected to have a Material Adverse Effect.
5.6. Taxes. The Borrower and its Subsidiaries have
filed all United States federal tax returns and all other tax
returns which are required to be filed and have paid all taxes
due pursuant to said returns or pursuant to any assessment
received by the Borrower or any of its Subsidiaries, except such
taxes, if any, as are being contested in good faith and as to
which adequate reserves have been provided. No tax liens have
been filed and no claims are being asserted with respect to any
such taxes. The charges, accruals and reserves on the books of
the Borrower and its Subsidiaries in respect of any taxes or
other governmental charges are adequate.
5.7. Litigation and Contingent Obligations. There is
no litigation, arbitration, governmental investigation,
proceeding or inquiry pending or, to the knowledge of any of
their officers, threatened against or affecting the Borrower or
any of its Subsidiaries which could reasonably be expected to
have a Material Adverse Effect. Other than any liability
incident to such litigation, arbitration or proceedings, the
Borrower as of the date of this Agreement has no material
Contingent Obligations not disclosed in Schedule "2" hereto. As
of the date of each Advance and the issuance of each Letter of
Credit, the Borrower has no Contingent Obligations other than
those allowed under Section 6.11.
5.8. Subsidiaries. Schedule "1" hereto contains an
accurate list of all of the presently existing Subsidiaries of
the Borrower, setting forth their respective jurisdictions of
incorporation and the percentage of their respective capital
stock owned by the Borrower or other Subsidiaries. All of the
issued and outstanding shares of capital stock of such
Subsidiaries have been duly authorized and issued and are fully
paid and non-assessable.
5.9. ERISA. The Unfunded Liabilities of all Single
Employer Plans do not in the aggregate exceed $100,000. Neither
the Borrower nor any other member of the Controlled Group has
incurred, or is reasonably expected to incur, any withdrawal
liability to Multiemployer Plans in excess of $100,000 in the
aggregate. Each Plan complies in all material respects with all
applicable requirements of law and regulations, no Reportable
Event has occurred with respect to any Plan, neither the Borrower
nor any other members of the Controlled Group has withdrawn from
any Plan or initiated steps to do so, and no steps have been
taken to reorganize or terminate any Plan; provided that the
Borrower and its Subsidiaries may withdraw from, or otherwise
terminate their respective participation in, Parent's Plans, so
long as such
24
withdrawal or other termination is done in compliance with all
applicable laws and regulations and does not otherwise give rise
to a Default.
5.10. Accuracy of Information. No information, exhibit
or report furnished by the Borrower or any of its Subsidiaries to
the Agent or to any Lender in connection with the negotiation of,
or compliance with, the Loan Documents contained any material
misstatement of fact or omitted to state a material fact or any
fact necessary to make the statements contained therein not
misleading.
5.11. Regulation U. Margin stock (as defined in
Regulation U) constitutes less than 25% of those assets of the
Borrower and its Subsidiaries which are subject to any limitation
on sale, pledge, or other restriction hereunder.
5.12. Material Agreements. Neither the Borrower nor any
Subsidiary is a party to any agreement or instrument or subject
to any charter or other corporate restriction which could
reasonably be expected to have a Material Adverse Effect.
Neither the Borrower nor any Subsidiary is in default in the
performance, observance or fulfillment of any of the obligations,
covenants or conditions contained in any agreement to which it is
a party or any agreement or instrument evidencing or governing
Indebtedness, which default could reasonably be expected to have
a Material Adverse Effect.
5.13. Compliance With Laws. The Borrower and its
Subsidiaries have complied with all applicable statutes, rules,
regulations, orders and restrictions of any domestic or foreign
government or any instrumentality or agency thereof, having
jurisdiction over the conduct of their respective businesses or
the ownership of their respective Property, the failure to comply
with which could reasonably be expected to have a Material
Adverse Effect. Neither the Borrower nor any Subsidiary has
received any notice to the effect that its operations are not in
material compliance with any of the requirements of applicable
federal, state and local environmental, health and safety
statutes and regulations or the subject of any federal or state
investigation evaluating whether any remedial action is needed to
respond to a release of any toxic or hazardous waste or substance
into the environment, which non-compliance or remedial action
could reasonably be expected to have a Material Adverse Effect.
5.14. Ownership of Properties. Except as set forth on
Schedule "2" hereto, on the date of this Agreement, the Borrower
and its Subsidiaries will have good title, free of all Liens
other than those permitted by Section 6.18, to all of the
Property and assets reflected in the financial statements as
owned by it.
5.15. Investment Company Act. Neither the Borrower nor
any Subsidiary thereof is an "investment company" or a company
"controlled" by an "investment company", within the meaning of
the Investment Company Act of 1940, as amended.
5.16. Public Utility Holding Company Act. Neither the
Borrower nor any of its Subsidiaries are "electric utility
companies" or "holding companies" within the meaning of the
25
Public Utility Holding Company Act of 1935, as amended (the
"Act"). The Parent is an "electric utility company" within the
meaning of the Act and is not a ?holding company? within the
meaning of the Act.
5.17. Insurance. The certificate signed by the
President or Chief Financial Officer of the Borrower, that
attests to the existence and adequacy of, and summarizes, the
property and casualty insurance program carried by the Borrower
and that has been furnished by the Borrower to the Agent and the
Lenders, is complete and accurate. This summary includes the
insurer's or insurers' name(s), policy number(s), expiration
date(s), amount(s) of coverage, type(s) of coverage,
exclusion(s), and deductibles. This summary also includes
similar information, and describes any reserves, relating to any
self-insurance program that is in effect.
ARTICLE VI
COVENANTS
During the term of this Agreement, unless the Required
Lenders shall otherwise consent in writing:
6.1. Financial Reporting. The Borrower will maintain,
for itself and each Subsidiary, a system of accounting
established and administered in accordance with generally
accepted accounting principles, and furnish to the Lenders:
(i) Within 90 days after the close of each of its fiscal
years, an unqualified (except for qualifications
relating to changes in accounting principles or
practices reflecting changes in generally accepted
principles of accounting and required or approved by
the Borrower's independent certified public
accountants) audit report certified by independent
certified public accountants, acceptable to the
Lenders, prepared in accordance with generally accepted
accounting principles on a consolidated and
consolidating basis (consolidating statements need not
be certified by such accountants) for itself and the
Subsidiaries, including balance sheets as of the end of
such period, related profit and loss and reconciliation
of surplus statements, and a statement of cash flows,
accompanied by (a) any management letter prepared by
said accountants, and (b) a certificate of said
accountants that, in the course of their examination
necessary for their certification of the foregoing,
they have obtained no knowledge of any Default or
Unmatured Default, or if, in the opinion of such
accountants, any Default or Unmatured Default shall
exist, stating the nature and status thereof.
(ii) Within 45 days after the close of the first three
quarterly periods of each of its fiscal years, for
itself and the Subsidiaries, consolidated and
consolidating unaudited balance sheets as at the close
of each such period and consolidated and consolidating
profit and loss and reconciliation of surplus
statements and a
26
statement of cash flows for the period from the
beginning of such fiscal year to the end of such
quarter, all certified by its President or the Vice
President and Chief Financial Officer.
(iii) As soon as available, but in any event within 60
days after the beginning of each fiscal year of the
Borrower, a copy of the plan and forecast (including a
projected consolidated and consolidating balance sheet,
income statement and funds flow statement and updated
projections) of the Borrower for such fiscal year.
(iv) Together with the financial statements required
hereunder, a compliance certificate in substantially
the form of Exhibit "E" hereto signed by its President
or the Vice President and Chief Financial Officer
showing the calculations necessary to determine
compliance with this Agreement and stating that no
Default or Unmatured Default exists, or if any Default
or Unmatured Default exists, stating the nature and
status thereof.
(v) Within 270 days after the close of each fiscal year, a
statement of the Unfunded Liabilities of each Single
Employer Plan, certified as correct by an actuary
enrolled under ERISA.
(vi) As soon as possible and in any event within 10 days
after the Borrower knows that any Reportable Event has
occurred with respect to any Plan, a statement, signed
by the President or the Vice President and Chief
Financial Officer of the Borrower, describing said
Reportable Event and the action which the Borrower
proposes to take with respect thereto.
(vii) As soon as possible and in any event within 10
days after receipt by the Borrower, a copy of (a) any
notice or claim to the effect that the Borrower or any
of its Subsidiaries is or may be liable to any Person
as a result of the release by the Borrower, any of its
Subsidiaries, or any other Person of any toxic or
hazardous waste or substance into the environment, and
(b) any notice alleging any violation of any federal,
state or local environmental, health or safety law or
regulation by the Borrower or any of its Subsidiaries,
which, in either case, could reasonably be expected to
have a Material Adverse Effect.
(viii) Promptly upon the filing thereof, copies of all
registration statements and annual, quarterly, monthly
or other regular reports which the Borrower or any of
its Subsidiaries files with the Securities and Exchange
Commission.
(ix) Such other information (including non-financial
information) as the Agent or any Lender may from time
to time reasonably request.
6.2. Use of Proceeds. The Borrower will, and will
cause each Subsidiary to, use the proceeds of the Advances for
working capital and general corporate purposes, to make Permitted
27
Acquisitions, to make Investments consistent with the Business
Plan, and to repay outstanding Advances. The Borrower will not,
nor will it permit any Subsidiary to, use any identifiable
portion of the proceeds of the Advances to purchase or carry any
"margin stock" (as defined in Regulation U) or to make any other
Acquisition.
6.3. Notice of Default. The Borrower will, and will
cause each Subsidiary to, give prompt notice in writing to the
Lenders of the occurrence of any Default or Unmatured Default and
of any other development, financial or otherwise, which could
reasonably be expected to have a Material Adverse Effect.
6.4. Conduct of Business. The Borrower will, and will
cause each Subsidiary to, carry on and conduct its business in
substantially the same manner and in substantially the same
fields of enterprise as it is presently conducted and as
contemplated in the Business Plan and to do all things necessary
to remain duly incorporated, validly existing and in good
standing as a domestic corporation in its jurisdiction of
incorporation and maintain all requisite authority to conduct its
business in each jurisdiction in which its business is conducted.
6.5. Taxes. The Borrower will, and will cause each
Subsidiary to, pay when due all taxes, assessments and
governmental charges and levies upon it or its income, profits or
Property, except those which are being contested in good faith by
appropriate proceedings and with respect to which adequate
reserves have been set aside.
6.6. Insurance. The Borrower will, and will cause each
Subsidiary to, maintain with financially sound and reputable
insurance companies insurance on all their Property in such
amounts and covering such risks as is consistent with sound
business practice, and the Borrower will furnish to any Lender
upon request full information as to the insurance carried.
6.7. Compliance with Laws. The Borrower will, and will
cause each Subsidiary to, comply with all laws, rules,
regulations, orders, writs, judgments, injunctions, decrees or
awards to which it may be subject, the failure to comply with
which could reasonably be expected to have a Material Adverse
Effect.
6.8. Maintenance of Properties. The Borrower will, and
will cause each Subsidiary to, do all things necessary to
maintain, preserve, protect and keep its Property in good repair,
working order and condition, and make all necessary and proper
repairs, renewals and replacements so that its business carried
on in connection therewith may be properly conducted at all
times.
6.9. Inspection. The Borrower will, and will cause
each Subsidiary to, permit the Lenders, by their respective
representatives and agents, to inspect any of the Property,
corporate books and financial records of the Borrower and each
Subsidiary, to examine and make copies of the books of accounts
and other financial records of the Borrower and each Subsidiary,
and to discuss the affairs, finances and accounts of the Borrower
and each Subsidiary with, and to be
28
advised as to the same by, their respective officers at such
reasonable times and intervals as the Lenders may designate.
6.10. Dividends. The Borrower will not, nor will it
permit any Subsidiary to, declare or pay any dividends on its
capital stock (other than dividends payable in its own capital
stock) or redeem, repurchase or otherwise acquire or retire any
of its capital stock at any time outstanding, except that (i) any
Subsidiary may declare and pay dividends to the Borrower or to a
Wholly-Owned Subsidiary, (ii) any Subsidiary may repurchase its
capital stock, and (iii) the Borrower may repurchase its capital
stock from the Parent at such times as no Default or Unmatured
Default has occurred and is continuing or would occur upon such
repurchase.
6.11. Indebtedness. The Borrower will not, nor will it
permit any Subsidiary to, create, incur or suffer to exist any
Indebtedness, except:
(i) The Loans.
(ii) Indebtedness existing on the date hereof and described
in Schedule "2" hereto.
(iii) Non-Recourse Debt of any Subsidiary.
(iv) KLT Investments Debt not exceeding $100,000,000 in the
aggregate.
(v) Contingent Obligations of the Borrower and its
Subsidiaries incurred after the date of the Prior
Agreement, provided that the Borrower is in compliance
with Sections 6.19 and 6.20.
(vi) Single-Project Subsidiary Debt.
(vii) Rate Hedging obligations related to the Loans.
(viii) Indebtedness of Strategic Energy, L.L.C. not
exceeding $5,000,000 in the aggregate.
(ix) Indebtedness of KLT Gas Inc. not exceeding $65,000,000 in
the aggregate arranged by Bank One.
6.12. Merger. The Borrower will not, nor will it permit
any Subsidiary to, merge or consolidate with or into any other
Person, except that (a) a Subsidiary may merge with the Borrower,
(b) a Subsidiary may merge or consolidate with or into another
Person, provided that the resulting or surviving entity is a
Subsidiary and provided, further, that no Subsidiary, (other than
KLT Gas Inc., or a Subsidiary thereof) may merge or consolidate
with KLT Gas Inc. or any Subsidiary thereof, and (c) the Borrower
may merge with an Affiliate, provided that (i) the Borrower is
the surviving Person and (ii) the Parent owns, free and clear of
all Liens or other
29
encumbrances, 100% of the outstanding shares of voting stock of
the surviving Person on a fully diluted basis.
6.13. Sale of Assets. The Borrower will not, nor will
it permit any Subsidiary to, lease, sell or otherwise dispose of
its Property, to any other Person except for (i) sales of
inventory in the ordinary course of business, (ii) at all times
that no Default or Unmatured Default has occurred and is
continuing, leases, sales or other dispositions of its Property
that, together with all other Property of the Borrower and its
Subsidiaries previously leased, sold or disposed of (other than
inventory in the ordinary course of business) as permitted by
this clause (ii) during the twelve-month period ending with the
month in which any such lease, sale or other disposition occurs,
do not constitute a Substantial Portion of the Property of the
Borrower and its Subsidiaries and (iii) sales of interests
(whether equity interests, interests in assets, or otherwise)
owned by a Subsidiary in power projects or other projects,
provided that fair value is received therefor. Notwithstanding
anything in this Section 6.13 to the contrary, nothing in this
Section 6.13 shall prohibit any Subsidiary from selling,
assigning, leasing, transferring or otherwise disposing of its
Property or assets to another Subsidiary.
6.14. Sale of Accounts. The Borrower will not, nor will
it permit any Subsidiary to, sell or otherwise dispose of any
notes receivable or accounts receivable, with or without
recourse.
6.15. Sale and Leaseback. The Borrower will not sell or
transfer any of its Property in order to concurrently or
subsequently lease as lessee such or similar Property.
6.16. Investments and Acquisitions. The Borrower will
not, nor will it permit any Subsidiary to, make or suffer to
exist any Investments (other than loans and advances to, and
other Investments in, Subsidiaries), or commitments therefor, or
to make any Acquisition of any Person, except:
(i) Short-term obligations of, or fully guaranteed by, the
United States of America or any agency or
instrumentality thereof, or any money market mutual
fund that invests substantially all of its assets in
such short-term obligations.
(ii) Commercial paper rated A-l or better by Standard and
Poor's Ratings Group or P-l or better by Xxxxx'x
Investors Service, Inc.
(iii) Demand deposit accounts maintained in the ordinary
course of business.
(iv) Certificates of deposit issued by and time deposits
with commercial banks (whether domestic or foreign)
having capital and surplus in excess of $100,000,000
and a long-term debt rating of A or better by Standard
and Poor's Ratings Group or Xxxxx'x Investors Service,
Inc.
30
(v) Existing Investments in Subsidiaries and other
Investments in existence on the date hereof and
described in Schedule "1" hereto.
(vi) Permitted Acquisitions.
(vii) Other Investments (including Investments in
partnerships, limited partnerships (whether as a
general partner or a limited partner), joint ventures,
limited liability companies, and other entities) made
as contemplated in and in accordance with the Business
Plan.
6.17. KLT Investments. The Borrower will not permit KLT
Investments to have assets other than its interests (whether
direct or indirect) in low-income housing projects and such other
assets as KLT Investments is required to hold in order to
maintain its interests in such projects or to support KLT
Investments Debt.
6.18. Liens. The Borrower will not, nor will it permit
any Subsidiary to, create, incur, or suffer to exist any Lien in,
of or on the Property of the Borrower or any of its Subsidiaries,
except:
(i) Liens for taxes, assessments or governmental charges or
levies on its Property if the same shall not at the
time be delinquent or thereafter can be paid without
penalty, or are being contested in good faith and by
appropriate proceedings and for which adequate reserves
in accordance with generally accepted principles of
accounting shall have been set aside on its books.
(ii) Liens imposed by law, such as carriers', warehousemen's
and mechanics' liens and other similar liens arising in
the ordinary course of business which secure payment of
obligations not more than 60 days past due or which are
being contested in good faith by appropriate
proceedings and for which adequate reserves in
accordance with generally accepted principles of
accounting shall have been set aside on its books.
(iii) Liens arising out of pledges or deposits under
worker's compensation laws, unemployment insurance, old
age pensions, or other social security or retirement
benefits, or similar legislation.
(iv) Utility easements, building restrictions and such other
encumbrances or charges against real property as are of
a nature generally existing with respect to properties
of a similar character and which do not in any material
way affect the marketability of the same or interfere
with the use thereof in the business of the Borrower or
the Subsidiaries.
(v) Liens existing on the date hereof and described in
Schedule "2" hereto.
31
(vi) Liens in favor of the Lenders granted pursuant to any
Collateral Document.
(vii) Judgment Liens which secure payment of legal
obligations that would not otherwise constitute a
Default under Section 7.9.
(viii) Liens securing KLT Investments Debt or Non-
Recourse Debt otherwise permitted under the terms of
this Agreement.
(ix) Liens on Property in existence at the time of
acquisition of such Property by the Borrower or any
Subsidiary.
(x) Deposits to secure the performance of bids, trade
contracts (other than for borrowed money), leases,
statutory obligations, surety and appeal bonds,
performance bonds, and other obligations of a like
nature incurred in the ordinary course of business by
the Borrower or any Subsidiary.
(xi) Liens on assets of Strategic Energy, L.L.C. securing
Indebtedness permitted by Section 6.11(viii).
(xii) Liens on the property of Strategic Energy, L.L.C.
securing contingent obligations on surety bonds
provided that the incurrence of any such Lien, after
giving effect thereto, would not cause a Default to
occur under Section 6.23.
(xiii) Liens on the assets of KLT Gas Inc. and its
subsidiaries securing Indebtedness permitted by Section
6.11(ix).
(xiv) Liens in favor of operators and non-operators
under joint operating agreements, pooling orders or
agreements, unitization agreements or similar
contractual arrangements arising in the ordinary course
of the business of the Borrower relating to the
development or operation of oil and gas properties to
secure amounts owing, which amounts are not yet due or
are being contested in good faith by appropriate
proceedings, if such reserve as may be required by
Agreement Accounting Principles shall have been made
therefor.
(xv) Liens under production sales agreements, division
orders, operating agreements and other agreements
customary in the oil and gas business for processing,
producing and selling hydrocarbons, provided that such
Liens do not secure obligations to deliver hydrocarbons
at some future date without receiving full payment
therefor within 90 days of delivery.
6.19. Leverage Ratio. The Borrower will maintain at all
times a ratio of Indebtedness for itself and its Subsidiaries on
a consolidated basis (other than KLT Investments Debt and Non-
Recourse Debt) to Net Worth not greater than 1.0 to 1.0. For
purposes of calculating this ratio, Contingent Obligations shall
be discounted by 100%.
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6.20. Net Worth. The Borrower will maintain a Net Worth
of not less than $75,000,000 at all times.
6.21. Affiliates. The Borrower will not, and will not
permit any Subsidiary to, enter into any transaction (including,
without limitation, the purchase or sale of any Property or
service) with, or make any payment or transfer to, any Affiliate
except in the ordinary course of business and pursuant to the
reasonable requirements of the Borrower's or such Subsidiary's
business and upon fair and reasonable terms no less favorable to
the Borrower or such Subsidiary than the Borrower or such
Subsidiary would obtain in a comparable arms-length transaction.
6.22. Amendments to Agreements. The Borrower will not,
and will not permit the Parent to, amend or terminate the Support
Agreement.
6.23. Adjusted Leverage Ratio. The Borrower will
maintain at all times a ratio of Indebtedness for itself and its
Subsidiaries on a consolidated basis (other than KLT Investments
Debt and Non-Recourse Debt) to Net Worth not greater than 1.5 to
1.0. For purposes of calculating this ratio, Contingent
Obligations shall be discounted by 75%.
ARTICLE VII
DEFAULTS
The occurrence of any one or more of the following events
shall constitute a Default:
7.1. Any representation or warranty made or deemed made
by or on behalf of the Borrower or any of its Subsidiaries to the
Lenders or the Agent under or in connection with this Agreement,
any Loan, or any certificate or information delivered in
connection with this Agreement or any other Loan Document shall
be materially false on the date as of which made.
7.2. Nonpayment of principal of any Note or of the
reimbursement obligations under any Letter of Credit when due, or
nonpayment of interest on any Note or on any reimbursement
obligation under any Letter of Credit or of any facility fee or
other obligations under any of the Loan Documents within five
days after the same becomes due.
7.3. The breach by the Borrower of any of the terms or
provisions of Section 6.2, 6.10, 6.11, 6.12, 6.13, 6.14, 6.15,
6.16, 6.17, 6.18, 6.19, 6.20, 6.21, 6.22 or 6.23.
7.4. The breach by the Borrower (other than a breach
which constitutes a Default under Section 7.1, 7.2 or 7.3) of any
of the terms or provisions of this Agreement which is not
remedied within five days after written notice from the Agent or
any Lender.
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7.5. Failure of the Borrower or any of its Subsidiaries
or the Parent to pay any Indebtedness when due; or the default by
the Borrower or any of its Subsidiaries or the Parent in the
performance of any term, provision or condition contained in any
agreement under which any Indebtedness was created or is
governed, or any other event shall occur or condition exist, the
effect of which is to cause, or to permit the holder or holders
of such Indebtedness to cause, such Indebtedness to become due
prior to its stated maturity; or any Indebtedness of the Borrower
or any of its Subsidiaries or the Parent shall be declared to be
due and payable or required to be prepaid (other than by a
regularly scheduled payment) prior to the stated maturity
thereof; or the Borrower or any of its Subsidiaries or the Parent
shall not pay, or admit in writing its inability to pay, its
debts generally as they become due.
7.6. The Borrower or any of its Subsidiaries or the
Parent shall (i) have an order for relief entered with respect to
it under the Federal bankruptcy laws as now or hereafter in
effect, (ii) make an assignment for the benefit of creditors,
(iii) apply for, seek, consent to, or acquiesce in, the
appointment of a receiver, custodian, trustee, examiner,
liquidator or similar official for it or any Substantial Portion
of its Property, (iv) institute any proceeding seeking an order
for relief under the Federal bankruptcy laws as now or hereafter
in effect or seeking to adjudicate it a bankrupt or insolvent, or
seeking dissolution, winding up, liquidation, reorganization,
arrangement, adjustment or composition of it or its debts under
any law relating to bankruptcy, insolvency or reorganization or
relief of debtors or fail to file an answer or other pleading
denying the material allegations of any such proceeding filed
against it, (v) take any corporate action to authorize or effect
any of the foregoing actions set forth in this Section 7.6 or
(vi) fail to contest in good faith any appointment or proceeding
described in Section 7.7.
7.7. Without the application, approval or consent of
the Borrower or any of its Subsidiaries or the Parent, a
receiver, trustee, examiner, liquidator or similar official shall
be appointed for the Borrower or any of its Subsidiaries or the
Parent or any Substantial Portion of its respective Property, or
a proceeding described in Section 7.6(iv) shall be instituted
against the Borrower or any of its Subsidiaries or the Parent and
such appointment continues undischarged or such proceeding
continues undismissed or unstayed for a period of 30 consecutive
days.
7.8. Any court, government or governmental agency shall
condemn, seize or otherwise appropriate, or take custody or
control of (each a "Condemnation"), all or any portion of the
Property of the Borrower and its Subsidiaries which, when taken
together with all other Property of the Borrower and its
Subsidiaries so condemned, seized, appropriated, or taken custody
or control of, during the twelve-month period ending with the
month in which any such Condemnation occurs, constitutes a
Substantial Portion.
7.9. The Borrower or any of its Subsidiaries shall fail
within 30 days to pay, bond or otherwise discharge any judgment
or order for the payment of money in excess of $100,000, which is
not stayed on appeal or otherwise being appropriately contested
in good faith.
7.10. The Unfunded Liabilities of all Single Employer
Plans shall exceed in the aggregate $100,000 or any Reportable
Event shall occur in connection with any Plan.
34
7.11. The Borrower or any other member of the Controlled
Group shall have been notified by the sponsor of a Multiemployer
Plan that it has incurred withdrawal liability to such
Multiemployer Plan in an amount which, when aggregated with all
other amounts required to be paid to Multiemployer Plans by the
Borrower or any other member of the Controlled Group as
withdrawal liability (determined as of the date of such
notification), exceeds $100,000.
7.12. The Borrower or any other member of the Controlled
Group shall have been notified by the sponsor of a Multiemployer
Plan that such Multiemployer Plan is in reorganization or is
being terminated, within the meaning of Title IV of ERISA, if as
a result of such reorganization or termination the aggregate
annual contributions of the Borrower and the other members of the
Controlled Group (taken as a whole) to all Multiemployer Plans
which are then in reorganization or being terminated have been or
will be increased over the amounts contributed to such
Multiemployer Plans for the respective plan years of each such
Multiemployer Plan immediately preceding the plan year in which
the reorganization or termination occurs by an amount exceeding
$100,000.
7.13. The Borrower or any of its Subsidiaries shall be
the subject of any proceeding or investigation pertaining to the
release by the Borrower or any of its Subsidiaries, or any other
Person of any toxic or hazardous waste or substance into the
environment, or any violation of any federal, state or local
environmental, health or safety law or regulation, which, in
either case, could reasonably be expected to have a Material
Adverse Effect.
7.14. Any Change in Control shall occur.
7.15. The occurrence of any "default", as defined in any
Transaction Document (other than this Agreement or the Notes) or
the breach of any of the terms or provisions of any Transaction
Document (other than this Agreement or the Notes) which default
or breach continues beyond any period of grace therein provided.
7.16. Any Collateral Document shall for any reason fail
to create a valid and perfected first priority security interest
in any collateral purported to be covered thereby, except as
permitted by the terms of any Collateral Document, or any
Collateral Document shall fail to remain in full force or effect
or any action shall be taken to discontinue or to assert the
invalidity or unenforceability of any Collateral Document, or the
Borrower shall fail to comply with any of the terms or provisions
of any Collateral Document.
7.17. The Support Agreement shall fail to remain in full
force or effect or any action shall be taken to discontinue or to
assert the invalidity or unenforceability of the Support
Agreement, or the Parent shall fail to comply with any of the
terms or provisions of the Support Agreement, or the Parent
denies that it has any further liability under the Support
Agreement, or gives notice to such effect.
35
7.18. Twenty-five percent (25%) or more of the value of
any class of equity interests in the Borrower shall be held by
"benefit plan investors" within the meaning of 29 C.F.R. ?2510.3-
101(f).
ARTICLE VIII
ACCELERATION, WAIVERS, AMENDMENTS AND REMEDIES
8.1. Acceleration. If any Default described in Section
7.6 or 7.7 occurs with respect to the Borrower, the obligations
of the Lenders to make Loans hereunder shall automatically
terminate and the Obligations shall immediately become due and
payable without any election or action on the part of the Agent
or any Lender. If any other Default occurs, the Required Lenders
may terminate or suspend the obligations of the Lenders to make
Loans hereunder, or declare the Obligations to be due and
payable, or both, whereupon the Obligations shall become
immediately due and payable, without presentment, demand, protest
or notice of any kind, all of which the Borrower hereby expressly
waives.
If, within 14 days after acceleration of the maturity of the
Obligations or termination of the obligations of the Lenders to
make Loans hereunder as a result of any Default (other than any
Default as described in Section 7.6 or 7.7 with respect to the
Borrower) and before any judgment or decree for the payment of
the Obligations due shall have been obtained or entered, the
Required Lenders (in their sole discretion) shall so direct, the
Agent shall, by notice to the Borrower, rescind and annul such
acceleration and/or termination.
8.2. Amendments. Subject to the provisions of this
Article VIII, the Required Lenders (or the Agent with the consent
in writing of the Required Lenders) and the Borrower may enter
into agreements supplemental hereto for the purpose of adding or
modifying any provisions to the Transaction Documents or changing
in any manner the rights of the Lenders or the Borrower hereunder
or waiving any Default hereunder; provided, however, that no such
supplemental agreement shall, without the consent of each Lender
affected thereby:
(i) Extend the maturity of any Loan, any Note or forgive
all or any portion of the principal amount thereof, or
reduce the rate or extend the time of payment of
interest or fees thereon.
(ii) Reduce the percentage specified in the definition of
Required Lenders.
(iii) Extend the Facility Termination Date, or increase
the amount of the Commitment of any Lender hereunder,
or permit the Borrower to assign its rights under this
Agreement.
(iv) Amend this Section 8.2.
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(v) Release or amend the Support Agreement except as
provided therein, or, except as provided in the
Collateral Documents, release all or any substantial
portion of the Collateral.
No amendment of any provision of this Agreement relating to the
Agent shall be effective without the written consent of the
Agent. The Agent may waive payment of the fee required under
Section 12.3.2 without obtaining the consent of any other party
to this Agreement.
8.3. Preservation of Rights. No delay or omission of
the Lenders or the Agent to exercise any right under the
Transaction Documents shall impair such right or be construed to
be a waiver of any Default or an acquiescence therein, and the
making of a Loan notwithstanding the existence of a Default or
the inability of the Borrower to satisfy the conditions precedent
to such Loan shall not constitute any waiver or acquiescence.
Any single or partial exercise of any such right shall not
preclude other or further exercise thereof or the exercise of any
other right, and no waiver, amendment or other variation of the
terms, conditions or provisions of the Transaction Documents
whatsoever shall be valid unless in writing signed by the Lenders
required pursuant to Section 8.2, and then only to the extent in
such writing specifically set forth. All remedies contained in
the Transaction Documents or by law afforded shall be cumulative
and all shall be available to the Agent and the Lenders until the
Obligations have been paid in full.
ARTICLE IX
GENERAL PROVISIONS
9.1. Survival of Representations. All representations and
warranties of the Borrower contained in this Agreement shall
survive delivery of the Notes, the making of the Loans and the
issuance of the Letters of Credit herein contemplated.
9.2. Governmental Regulation. Anything contained in
this Agreement to the contrary notwithstanding, no Lender shall
be obligated to extend credit to the Borrower in violation of any
limitation or prohibition provided by any applicable statute or
regulation.
9.3. Taxes. Any taxes (excluding federal income taxes
on the overall net income of any Lender and withholding taxes
contemplated under Section 2.18) or other similar assessments or
charges made by any governmental or revenue authority in respect
of the Transaction Documents shall be paid by the Borrower,
together with interest and penalties, if any, other than interest
and penalties to the extent the accrual of which is attributable
to the gross negligence or willful misconduct of the Lenders.
9.4. Headings. Section headings in the Transaction
Documents are for convenience of reference only, and shall not
govern the interpretation of any of the provisions of the
Transaction Documents.
37
9.5. Entire Agreement. The Transaction Documents
embody the entire agreement and understanding among the Borrower,
the Agent and the Lenders and supersede all prior agreements and
understandings among the Borrower, the Agent and the Lenders
relating to the subject matter thereof.
9.6. Several Obligations; Benefits of this Agreement.
The respective obligations of the Lenders hereunder are several
and not joint and no Lender shall be the partner or agent of any
other (except to the extent to which the Agent is authorized to
act as such). The failure of any Lender to perform any of its
obligations hereunder shall not relieve any other Lender from any
of its obligations hereunder. This Agreement shall not be
construed so as to confer any right or benefit upon any Person
other than the parties to this Agreement and their respective
successors and assigns.
9.7. Expenses; Indemnification. The Borrower shall
reimburse the Agent for any costs, internal charges and
out-of-pocket expenses (including attorneys' fees and time
charges of attorneys for the Agent, which attorneys may be
employees of the Agent) paid or incurred by the Agent in
connection with the preparation, negotiation, execution,
delivery, review, amendment, modification, and administration of
the Transaction Documents. The Borrower also agrees to reimburse
the Agent and the Lenders for any costs, internal charges and
out-of-pocket expenses (including attorneys' fees and time
charges of attorneys for the Agent and the Lenders, which
attorneys may be employees of the Agent or the Lenders) paid or
incurred by the Agent or any Lender in connection with the
collection and enforcement of the Transaction Documents. The
Borrower further agrees to indemnify the Agent and each Lender,
its directors, officers and employees against all losses, claims,
damages, penalties, judgments, liabilities and expenses
(including, without limitation, all expenses of litigation or
preparation therefor whether or not the Agent or any Lender is a
party thereto) which any of them may pay or incur arising out of
or relating to this Agreement, the other Transaction Documents,
the transactions contemplated hereby or the direct or indirect
application or proposed application of the proceeds of any Loan
hereunder except to the extent such obligations arise from the
gross negligence or willful misconduct of the Lenders. The
obligations of the Borrower under this Section shall survive the
termination of this Agreement.
9.8. Numbers of Documents. All statements, notices,
closing documents, and requests hereunder shall be furnished to
the Agent with sufficient counterparts so that the Agent may
furnish one to each of the Lenders.
9.9. Accounting. Except as provided to the contrary
herein, all accounting terms used herein shall be interpreted and
all accounting determinations hereunder shall be made in
accordance with generally accepted accounting principles, except
that any calculation or determination which is to be made on a
consolidated basis shall be made for the Borrower and all its
Subsidiaries, including those Subsidiaries, if any, which are
unconsolidated on the Borrower's audited financial statements.
38
9.10. Severability of Provisions. Any provision in any
Transaction Document that is held to be inoperative,
unenforceable, or invalid in any jurisdiction shall, as to that
jurisdiction, be inoperative, unenforceable, or invalid without
affecting the remaining provisions in that jurisdiction or the
operation, enforceability, or validity of that provision in any
other jurisdiction, and to this end the provisions of all
Transaction Documents are declared to be severable.
9.11. Nonliability of Lenders. The relationship between
the Borrower and the Lenders and the Agent shall be solely that
of borrower and lender. Neither the Agent nor any Lender shall
have any fiduciary responsibilities to the Borrower. Neither the
Agent nor any Lender undertakes any responsibility to the
Borrower to review or inform the Borrower of any matter in
connection with any phase of the Borrower's business or
operations.
9.12. CHOICE OF LAW. THE TRANSACTION DOCUMENTS (OTHER
THAN THOSE CONTAINING A CONTRARY EXPRESS CHOICE OF LAW PROVISION)
SHALL BE CONSTRUED IN ACCORDANCE WITH THE INTERNAL LAWS (AND NOT
THE LAW OF CONFLICTS) OF THE STATE OF ILLINOIS, BUT GIVING EFFECT
TO FEDERAL LAWS APPLICABLE TO NATIONAL BANKS.
9.13. CONSENT TO JURISDICTION. THE BORROWER HEREBY
IRREVOCABLY SUBMITS TO THE NON-EXCLUSIVE JURISDICTION OF ANY
UNITED STATES FEDERAL OR ILLINOIS STATE COURT SITTING IN CHICAGO
IN ANY ACTION OR PROCEEDING ARISING OUT OF OR RELATING TO ANY
TRANSACTION DOCUMENTS AND THE BORROWER HEREBY IRREVOCABLY AGREES
THAT ALL CLAIMS IN RESPECT OF SUCH ACTION OR PROCEEDING MAY BE
HEARD AND DETERMINED IN ANY SUCH COURT AND IRREVOCABLY WAIVES ANY
OBJECTION IT MAY NOW OR HEREAFTER HAVE AS TO THE VENUE OF ANY
SUCH SUIT, ACTION OR PROCEEDING BROUGHT IN SUCH A COURT OR THAT
SUCH COURT IS AN INCONVENIENT FORUM. NOTHING HEREIN SHALL LIMIT
THE RIGHT OF THE AGENT OR ANY LENDER TO BRING PROCEEDINGS AGAINST
THE BORROWER IN THE COURTS OF ANY OTHER JURISDICTION. ANY
JUDICIAL PROCEEDING BY THE BORROWER AGAINST THE AGENT OR ANY
LENDER OR ANY AFFILIATE OF THE AGENT OR ANY LENDER INVOLVING,
DIRECTLY OR INDIRECTLY, ANY MATTER IN ANY WAY ARISING OUT OF,
RELATED TO, OR CONNECTED WITH ANY TRANSACTION DOCUMENT SHALL BE
BROUGHT ONLY IN A COURT IN CHICAGO, ILLINOIS.
9.14. WAIVER OF JURY TRIAL. THE BORROWER, THE AGENT AND
EACH LENDER HEREBY WAIVE TRIAL BY JURY IN ANY JUDICIAL PROCEEDING
INVOLVING, DIRECTLY OR INDIRECTLY, ANY MATTER (WHETHER SOUNDING
IN TORT, CONTRACT OR OTHERWISE) IN ANY WAY ARISING OUT OF,
RELATED TO, OR CONNECTED WITH ANY TRANSACTION DOCUMENT OR THE
RELATIONSHIP ESTABLISHED THEREUNDER.
39
9.15. Confidentiality. Each Lender agrees to hold any
confidential information which it may receive from the Borrower
pursuant to this Agreement in confidence, except for disclosure
(i) to other Lenders and their respective Affiliates, (ii) to
legal counsel, accountants, and other professional advisors to
that Lender or to a Transferee, (iii) to regulatory officials,
(iv) to any Person as requested pursuant to or as required by
law, regulation, or legal process, (v) to any Person in
connection with any legal proceeding to which that Lender is a
party, and (vi) permitted by Section 12.4; each of whom shall be
informed of the confidential nature of the information and shall
agree, to the extent the disclosing Lender may compel such
agreement, to maintain such confidentiality in accordance with
this Section 9.15.
9.16. Nonreliance. Each Lender hereby represents that
it is not relying on or looking to any margin stock (as defined
in Regulation U of the Board of Governors of the Federal Reserve
System) for the repayment of the Loans provided for herein.
9.17. Effect on Prior Agreement; Ratification. The
Borrower, the Agent, and the Lenders agree that, on the
Restatement Date, all indebtedness, liabilities and obligations
of the Borrower to the Lenders outstanding under the Prior
Agreement and the promissory notes delivered under the Prior
Agreement shall, to the extent not paid on such date, be deemed
to be Obligations outstanding under this Agreement and under the
Notes. Each Lender party to the Prior Agreement shall, promptly
after receipt of its Note under this Agreement, return to the
Borrower the promissory note received by it in connection with
the Prior Agreement. By its execution of this Agreement and in
consideration of the undertakings set forth herein and other good
and valuable consideration, the receipt of which is hereby
acknowledged, each Lender that is not a Prior Lender (each such
Lender a "New Lender") hereby assumes and covenants and agrees
fully, completely and timely to perform, comply with, and
discharge each and all of the obligations, duties, and
liabilities of a Lender under this Agreement and shall as of the
Restatement Date be deemed a Lender for all purposes under this
Agreement. As of the Restatement Date, each New Lender shall
purchase such portions of the outstanding Advances from the Prior
Lenders so as to allocate to each Lender its ratable share of
outstanding Advances after giving effect to the restatement
contemplated hereunder; provided that (a) no Prior Lender shall
be required to terminate a Eurodollar Loan prior to its maturity
date and (b) no New Lender shall be required to purchase a share
of any Eurodollar Loan bearing interest at a rate below the
current market rate for that Type of Advance. The Borrower, the
Agent, and the Lenders agree that (i) all terms and conditions of
the Prior Agreement which are amended and restated by this
Agreement shall remain effective until such amendment and
restatement becomes effective under this Agreement, and (ii) the
representations, warranties and covenants set forth herein shall
become effective concurrently with the occurrence of the
Restatement Date, and (iii) as of the Restatement Date, each
reference in any Collateral Document to the "Agreement" or
"Credit Agreement" shall be deemed to be a reference to the Prior
Agreement as amended and restated in the form of this Agreement.
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ARTICLE X
THE AGENT
10.1. Appointment. Bank One, NA is hereby appointed
Agent hereunder and under each other Loan Document, and each of
the Lenders irrevocably authorizes the Agent to act as the agent
of such Lender. The Agent agrees to act as such upon the express
conditions contained in this Article X. The Agent shall not have
a fiduciary relationship in respect of the Borrower or any Lender
by reason of this Agreement.
10.2. Powers. The Agent shall have and may exercise
such powers under the Loan Documents as are specifically
delegated to the Agent by the terms of each thereof, together
with such powers as are reasonably incidental thereto. The Agent
shall have no implied duties to the Lenders, or any obligation to
the Lenders to take any action thereunder except any action
specifically provided by the Loan Documents to be taken by the
Agent.
10.3. General Immunity. Neither the Agent nor any of
its directors, officers, agents or employees shall be liable to
the Borrower, the Lenders or any Lender for any action taken or
omitted to be taken by it or them hereunder or under any other
Loan Document or in connection herewith or therewith except for
its or their own gross negligence or willful misconduct.
10.4. No Responsibility for Loans, Recitals, etc.
Neither the Agent nor any of its directors, officers, agents or
employees shall be responsible for or have any duty to ascertain,
inquire into, or verify (i) any statement, warranty or
representation made in connection with any Loan Document or any
borrowing hereunder; (ii) the performance or observance of any of
the covenants or agreements of any obligor under any Loan
Document, including, without limitation, any agreement by an
obligor to furnish information directly to each Lender; (iii) the
satisfaction of any condition specified in Article IV, except
receipt of items required to be delivered to the Agent; (iv) the
validity, effectiveness or genuineness of any Loan Document or
any other instrument or writing furnished in connection
therewith; or (v) the value, sufficiency, creation, perfection or
priority of any interest in any collateral security. The Agent
shall have no duty to disclose to the Lenders information that is
not required to be furnished by the Borrower to the Agent at such
time, but is voluntarily furnished by the Borrower to the Agent
(either in its capacity as Agent or in its individual capacity).
10.5. Action on Instructions of Lenders. The Agent
shall in all cases be fully protected in acting, or in refraining
from acting, hereunder and under any other Loan Document in
accordance with written instructions signed by the requisite
number of Lenders, and such instructions and any action taken or
failure to act pursuant thereto shall be binding on all of the
Lenders and on all holders of Notes. The Agent shall be fully
justified in failing or refusing to take any action hereunder and
under any other Loan Document unless it shall first be
indemnified to its satisfaction by the Lenders pro rata against
any and all liability, cost and expense that it may incur by
reason of taking or continuing to take any such action.
41
10.6. Employment of Agents and Counsel. The Agent may
execute any of its duties as Agent hereunder and under any other
Loan Document by or through employees, agents, and
attorneys-in-fact and shall not be answerable to the Lenders,
except as to money or securities received by it or its authorized
agents, for the default or misconduct of any such agents or
attorneys-in-fact selected by it with reasonable care. The Agent
shall be entitled to advice of counsel concerning all matters
pertaining to the agency hereby created and its duties hereunder
and under any other Loan Document.
10.7. Reliance on Documents; Counsel. The Agent shall
be entitled to rely upon any Note, Letter of Credit Application,
notice, consent, certificate, affidavit, letter, telegram,
statement, paper or document believed by it to be genuine and
correct and to have been signed or sent by the proper person or
persons, and, in respect to legal matters, upon the opinion of
counsel selected by the Agent, which counsel may be employees of
the Agent.
10.8. Agent's Reimbursement and Indemnification. The
Lenders agree to reimburse and indemnify the Agent ratably in
proportion to their respective Commitments (i) for any amounts
not reimbursed by the Borrower for which the Agent is entitled to
reimbursement by the Borrower under the Loan Documents, (ii) for
any other expenses incurred by the Agent on behalf of the
Lenders, in connection with the preparation, execution, delivery,
administration and enforcement of the Loan Documents and (iii)
for any liabilities, obligations, losses, damages, penalties,
actions, judgments, suits, costs, expenses or disbursements of
any kind and nature whatsoever which may be imposed on, incurred
by or asserted against the Agent in any way relating to or
arising out of the Loan Documents or any other document delivered
in connection therewith or the transactions contemplated thereby,
or the enforcement of any of the terms thereof or of any such
other documents, provided that no Lender shall be liable for any
of the foregoing to the extent they arise from the gross
negligence or willful misconduct of the Agent. The obligations
of the Lenders under this Section 10.8 shall survive payment of
the Obligations and termination of this Agreement.
10.9. Rights as a Lender. In the event the Agent is a
Lender, the Agent shall have the same rights and powers hereunder
and under any other Loan Document as any Lender and may exercise
the same as though it were not the Agent, and the term "Lender"
or "Lenders" shall, at any time when the Agent is a Lender,
unless the context otherwise indicates, include the Agent in its
individual capacity. The Agent may accept deposits from, lend
money to, and generally engage in any kind of trust, debt, equity
or other transaction, in addition to those contemplated by this
Agreement or any other Loan Document, with the Borrower or any of
its Subsidiaries in which the Borrower or such Subsidiary is not
restricted hereby from engaging with any other Person.
10.10. Lender Credit Decision. Each Lender acknowledges
that it has, independently and without reliance upon the Agent or
any other Lender and based on the financial statements prepared
by the Borrower and such other documents and information as it
has deemed appropriate, made its own credit analysis and decision
to enter into this Agreement and the other Loan Documents. Each
Lender also acknowledges that it will, independently and without
42
reliance upon the Agent or any other Lender and based on such
documents and information as it shall deem appropriate at the
time, continue to make its own credit decisions in taking or not
taking action under this Agreement and the other Loan Documents.
10.11. Successor Agent. The Agent may resign at any time
by giving written notice thereof to the Lenders and the Borrower,
such resignation to be effective upon the appointment of a
successor Agent or, if no successor Agent has been appointed,
forty-five days after the retiring Agent gives notice of its
intention to resign. Upon any such resignation, the Required
Lenders shall have the right to appoint, on behalf of the
Borrower and the Lenders, a successor Agent. If no successor
Agent shall have been so appointed by the Required Lenders within
thirty days after the resigning Agent's giving notice of its
intention to resign, then the resigning Agent may appoint, on
behalf of the Borrower and the Lenders, a successor Agent. If
the Agent has resigned and no successor Agent has been appointed,
the Lenders may perform all the duties of the Agent hereunder and
the Borrower shall make all payments in respect of the
Obligations to the applicable Lender and for all other purposes
shall deal directly with the Lenders. No successor Agent shall
be deemed to be appointed hereunder until such successor Agent
has accepted the appointment. Any such successor Agent shall be
a commercial bank having capital and retained earnings of at
least $50,000,000. Upon the acceptance of any appointment as
Agent hereunder by a successor Agent, such successor Agent shall
thereupon succeed to and become vested with all the rights,
powers, privileges and duties of the resigning Agent. Upon the
effectiveness of the resignation of the Agent, the resigning
Agent shall be discharged from its duties and obligations
hereunder and under the Loan Documents. After the effectiveness
of the resignation of an Agent, the provisions of this Article X
shall continue in effect for the benefit of such Agent in respect
of any actions taken or omitted to be taken by it while it was
acting as the Agent hereunder and under the other Loan Documents.
10.12. Agent's Fee. The Borrower agrees to pay to the
Agent, for its own account, the fees agreed to by the Borrower
and the Agent pursuant to that certain letter agreement dated
May 3, 2000, or as otherwise agreed from time to time.
10.13 Other Agents. None of the Lenders identified on
the cover page or the signature pages of this Agreement or
otherwise herein, or in any amendment hereof or other document
related hereto, as being the "Syndication Agent" or the
"Documentation Agent" (collectively the "Other Agents") shall
have any right, power, obligation, liability, responsibility or
duty under this Agreement in such capacity other than those
applicable to all Lenders. Each Lender acknowledges that it has
not relied, and will not rely, on any of the Other Agents in
deciding to enter into this Agreement or in taking or refraining
from taking any action hereunder or pursuant hereto.
43
ARTICLE XI
SETOFF; RATABLE PAYMENTS
11.1. Setoff. In addition to, and without limitation
of, any rights of the Lenders under applicable law, if the
Borrower becomes insolvent, however evidenced, or any Default or
Unmatured Default occurs, any and all deposits (including all
account balances, whether provisional or final and whether or not
collected or available) and any other Indebtedness at any time
held or owing by any Lender to or for the credit or account of
the Borrower may be offset and applied toward the payment of the
Obligations owing to such Lender, whether or not the Obligations,
or any part hereof, shall then be due.
11.2. Ratable Payments. If any Lender, whether by
setoff or otherwise, has payment made to it upon its Loans (other
than payments received pursuant to Sections 3.1, 3.2 or 3.4) in a
greater proportion than that received by any other Lender, such
Lender agrees, promptly upon demand, to purchase a portion of the
Loans held by the other Lenders so that after such purchase each
Lender will hold its ratable proportion of Loans. If any Lender,
whether in connection with setoff or amounts which might be
subject to setoff or otherwise, receives collateral or other
protection for its Obligations or such amounts which may be
subject to setoff, such Lender agrees, promptly upon demand, to
take such action necessary such that all Lenders share in the
benefits of such collateral ratably in proportion to their Loans.
In case any such payment is disturbed by legal process, or
otherwise, appropriate further adjustments shall be made.
ARTICLE XII
BENEFIT OF AGREEMENT; ASSIGNMENTS; PARTICIPATIONS
12.1. Successors and Assigns. The terms and provisions
of the Loan Documents shall be binding upon and inure to the
benefit of the Borrower and the Lenders and their respective
successors and assigns, except that (i) the Borrower shall not
have the right to assign its rights or obligations under the Loan
Documents and (ii) any assignment by any Lender must be made in
compliance with Section 12.3. Notwithstanding clause (ii) of
this Section, any Lender may at any time, without the consent of
the Borrower or the Agent, assign all or any portion of its
rights under this Agreement and its Notes to a Federal Reserve
Bank; provided, however, that no such assignment shall release
the transferor Lender from its obligations hereunder. The Agent
may treat the payee of any Note as the owner thereof for all
purposes hereof unless and until such payee complies with Section
12.3 in the case of an assignment thereof or, in the case of any
other transfer, a written notice of the transfer is filed with
the Agent. Any assignee or transferee of a Note agrees by
acceptance thereof to be bound by all the terms and provisions of
the Loan Documents. Any request, authority or consent of any
Person, who at the time of making such request or giving such
authority or consent is the holder of any Note, shall be
conclusive and binding on any subsequent holder, transferee or
assignee of such Note or of any Note or Notes issued in exchange
therefor.
44
12.2. Participations.
12.2.1. Permitted Participants; Effect. Any Lender
may, in the ordinary course of its business and in
accordance with applicable law, at any time sell to one or
more banks or other entities ("Participants") participating
interests in any Loan owing to such Lender, any Note held by
such Lender, any Commitment of such Lender or any other
interest of such Lender under the Loan Documents. In the
event of any such sale by a Lender of participating
interests to a Participant, such Lender's obligations under
the Loan Documents shall remain unchanged, such Lender shall
remain solely responsible to the other parties hereto for
the performance of such obligations, such Lender shall
remain the holder of any such Note for all purposes under
the Loan Documents, all amounts payable by the Borrower
under this Agreement shall be determined as if such Lender
had not sold such participating interests, and the Borrower
and the Agent shall continue to deal solely and directly
with such Lender in connection with such Lender's rights and
obligations under the Loan Documents.
12.2.2. Voting Rights. Each Lender shall retain the
sole right to approve, without the consent of any
Participant, any amendment, modification or waiver of any
provision of the Loan Documents other than any amendment,
modification or waiver with respect to any Loan or
Commitment in which such Participant has an interest which
forgives principal, interest or fees or reduces the interest
rate or fees payable with respect to any such Loan or
Commitment, postpones any date fixed for any
regularly-scheduled payment of principal of, or interest or
fees on, any such Loan or Commitment, releases any guarantor
of any such Loan or releases any substantial portion of
collateral, if any, securing any such Loan.
12.2.3. Benefit of Setoff. The Borrower agrees that
each Participant shall be deemed to have the right of setoff
provided in Section 11.1 in respect of its participating
interest in amounts owing under the Loan Documents to the
same extent as if the amount of its participating interest
were owing directly to it as a Lender under the Loan
Documents, provided that each Lender shall retain the right
of setoff provided in Section 11.1 with respect to the
amount of participating interests sold to each Participant.
The Lenders agree to share with each Participant, and each
Participant, by exercising the right of setoff provided in
Section 11.1, agrees to share with each Lender, any amount
received pursuant to the exercise of its right of setoff,
such amounts to be shared in accordance with Section 11.2 as
if each Participant were a Lender.
12.3. Assignments.
12.3.1. Permitted Assignments. Any Lender may, in the
ordinary course of its business and in accordance with
applicable law, at any time assign to one or more banks or
other entities ("Purchasers") all or any part of its rights
and obligations under the Loan Documents, provided that any
such assignment shall be in a minimum amount of the lesser
of $5,000,000 or the assigning Lender's Commitment. Such
assignment shall be
45
substantially in the form of Exhibit "F" hereto or in such
other form as may be agreed to by the parties thereto. The
consent of the Borrower and the Agent shall be required
prior to an assignment becoming effective with respect to a
Purchaser which is not a Lender or an Affiliate thereof;
provided, however, that if a Default has occurred and is
continuing, the consent of the Borrower shall not be
required. Such consent shall not be unreasonably withheld.
12.3.2. Effect; Effective Date. Upon (i) delivery to
the Agent of a notice of assignment, substantially in the
form attached as Exhibit "I" to Exhibit "F" hereto (a
"Notice of Assignment"), together with any consents required
by Section 12.3.1, and (ii) payment of a $4,000 fee to the
Agent for processing such assignment, such assignment shall
become effective on the effective date specified in such
Notice of Assignment. The Notice of Assignment shall
contain a representation by the Purchaser to the effect that
none of the consideration used to make the purchase of the
Commitment and Loans under the applicable assignment
agreement are "plan assets" as defined under ERISA and that
the rights and interests of the Purchaser in and under the
Loan Documents will not be "plan assets" under ERISA. On
and after the effective date of such assignment, such
Purchaser shall for all purposes be a Lender party to this
Agreement and any other Loan Document executed by the
Lenders and shall have all the rights and obligations of a
Lender under the Loan Documents, to the same extent as if it
were an original party hereto, and no further consent or
action by the Borrower, the Lenders or the Agent shall be
required to release the transferor Lender with respect to
the percentage of the Aggregate Commitment and Loans
assigned to such Purchaser. Upon the consummation of any
assignment to a Purchaser pursuant to this Section 12.3.2,
the transferor Lender, the Agent and the Borrower shall make
appropriate arrangements so that replacement Notes are
issued to such transferor Lender and new Notes or, as
appropriate, replacement Notes, are issued to such
Purchaser, in each case in principal amounts reflecting
their Commitment, as adjusted pursuant to such assignment.
12.4. Dissemination of Information. The Borrower
authorizes each Lender to disclose to any Participant or
Purchaser or any other Person acquiring an interest in the Loan
Documents by operation of law (each a "Transferee") and any
prospective Transferee any and all information in such Lender's
possession concerning the creditworthiness of the Borrower and
its Subsidiaries; provided that each Transferee and prospective
Transferee agrees to be bound by Section 9.15 of this Agreement.
12.5. Tax Treatment. If any interest in any Loan
Document is transferred to any Transferee which is organized
under the laws of any jurisdiction other than the United States
or any State thereof, the transferor Lender shall cause such
Transferee, concurrently with the effectiveness of such transfer,
to comply with the provisions of Section 2.18.
46
ARTICLE XIII
NOTICES
13.1. Giving Notice. Except as otherwise permitted by
Section 2.13 with respect to borrowing notices, all notices and
other communications provided to any party hereto under this
Agreement or any other Loan Document shall be in writing or by
telex or by facsimile and addressed or delivered to such party at
its address set forth below its signature hereto or at such other
address as may be designated by such party in a notice to the
other parties. Any notice, if mailed and properly addressed with
postage prepaid, shall be deemed given when received; any notice,
if transmitted by telex or facsimile, shall be deemed given when
transmitted (answerback confirmed in the case of telexes).
13.2. Change of Address. The Borrower, the Agent and
any Lender may each change the address for service of notice upon
it by a notice in writing to the other parties hereto.
ARTICLE XIV
COUNTERPARTS
This Agreement may be executed in any number of
counterparts, all of which taken together shall constitute one
agreement, and any of the parties hereto may execute this
Agreement by signing any such counterpart. This Agreement shall
be effective when it has been executed by the Borrower, the Agent
and the Lenders and each party has notified the Agent by telex or
telephone, that it has taken such action.
47
IN WITNESS WHEREOF, the Borrower, the Lenders and the Agent
have executed this Agreement as of the date first above written.
KLT INC.
By: /s/Xxxxx X. Xxxxx
Xxxxx X. Xxxxx
Vice President, Chief Financial
Officer and Treasurer
00000 Xxxx Xxxxxx, Xxxxx 000
Xxxxxxxx Xxxx, Xxxxxx 00000
Attention: Xxxxx X. Xxxxx
Vice President, Chief
Financial Officer and
Treasurer
Telecopier: (000) 000-0000
S-1
BANK ONE, NA, Individually and as Agent
By: /s/Xxxx Xx X. Xxxxxx
Xxxx Xx X. Xxxxxx
Authorized Agent
1 Bank Xxx Xxxxx
Xxxx Xxxxx 0000
Xxxxxxx, Xxxxxxxx 00000
Attention: Electric, Gas and
Telecommunications
Division
Telecopier: (000) 000-0000
ABN AMRO BANK N.V.
By: /s/Xxxx X. Xxxxxxxxx
Print Name: Xxxx X. Xxxxxxxxx
Title: Group Vice President
By: /s/Xxxxx X. Xxxxxx
Print Name: Xxxxx X. Xxxxxx
Title: Senior Vice President &
Managing Director
000 X. XxXxxxx Xxxxxx, Xxxx 000
Xxxxxxx, Xxxxxxxx 00000-0000
Attention: Xxxx Xxxxx
Vice President and Director
Telecopier: (000) 000-0000
S-2
WESTDEUTSCHE LANDESBANK
GIROZENTRALE, NEW YORK BRANCH,
as Documentation Agent
By: /s/Xxxxxx X. Xxxxxxxxx
Print Name: Xxxxxx X. Xxxxxxxxx
Title: Director
By: Xxxxxx X. Xxxxx III
Print Name: Xxxxxx X. Xxxxx III
Title: Associate Director
0000 Xxxxxx xx xxx Xxxxxxxx
Xxx Xxxx, Xxx Xxxx 00000
Attention: Loan Administration
Telecopier: (000) 000-0000
S-3
COMMERZBANK AKTIENGESELLSCHAFT,
NEW YORK AND GRAND CAYMAN
BRANCHES, as Syndication Agent
By: /s/Xxxx Xxxxxx
Print Name: Xxxx Xxxxxx
Title: Asst. Vice President
By: /s/Xxxxx X. Xxxxx
Print Name: Xxxxx X. Xxxxx
Title: Asst. Vice President
00 Xxxxx Xxxxx Xxxxxx
Xxxxx 0000
Xxxxxxx, Xxxxxxxx 00000
Attention: Xxxx Xxxxxx
Telecopier: (000) 000-0000
S-4
THE DAI-ICHI KANGYO BANK, LTD.,
CHICAGO BRANCH
By: /s/Nobuyasu Fukatsu
Print Name: Nobuyasu Fukatsu
Title: General Manager
00 X. Xxxxxx Xxxxx, Xxxxx 0000
Xxxxxxx, Xxxxxxxx 00000
Attention: Xxxxxxx Xxxxxxxx
Telecopier: (000) 000-0000
S-5
