EXHIBIT 4(l)(1)
EXECUTION COPY
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$1,310,000,000 CREDIT AGREEMENT
Dated as of November 12, 2002
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Among
CENTERPOINT ENERGY HOUSTON ELECTRIC, LLC,
as Borrower,
THE BANKS PARTIES HERETO
and
CREDIT SUISSE FIRST BOSTON,
as sole and exclusive Administrative Agent
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CREDIT SUISSE FIRST BOSTON,
as Sole Lead Arranger and Bookrunner,
and
DEUTSCHE BANK SECURITIES INC.
and
BANC OF AMERICA SECURITIES LLC,
as Co-Arrangers
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TABLE OF CONTENTS
PAGE
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ARTICLE I DEFINITIONS AND ACCOUNTING TERMS 1
SECTION 1.1. Certain Defined Terms 1
SECTION 1.2. Other Definitional Provisions 19
ARTICLE II AMOUNTS AND TERMS OF THE LOANS 20
SECTION 2.1. Commitments 20
SECTION 2.2. Procedure for Loan Borrowing 20
SECTION 2.3. Repayment of Loans 20
SECTION 2.4. Minimum and Maximum Tranches 20
ARTICLE III [INTENTIONALLY OMITTED] 21
ARTICLE IV PROVISIONS RELATING TO ALL LOANS 21
SECTION 4.1. The Loans 21
SECTION 4.2. Fees 21
SECTION 4.3. Interest 21
SECTION 4.4. Reserve Requirements 22
SECTION 4.5. Interest Rate Determination and Protection 23
SECTION 4.6. Voluntary Interest Conversion or Continuation of Loans 23
SECTION 4.7. Funding Losses Relating to LIBOR Rate Loans 24
SECTION 4.8. Change in Legality 25
ARTICLE V INCREASED COSTS, TAXES, PAYMENTS AND PREPAYMENTS 25
SECTION 5.1. Increased Costs; Capital Adequacy 25
SECTION 5.2. Pro Rata Treatment and Payments 27
SECTION 5.3. Taxes 28
SECTION 5.4. Sharing of Payments, Etc. 30
SECTION 5.5. Voluntary Prepayments 30
SECTION 5.6. Mandatory Repayments and Prepayments and Commitment Reductions 30
SECTION 5.7. Mitigation of Losses and Costs 31
SECTION 5.8. Determination and Notice of Additional Costs and Other Amounts 32
ARTICLE VI CONDITIONS OF LENDING 32
SECTION 6.1. Conditions Precedent to Effectiveness and Loans 32
ARTICLE VII REPRESENTATIONS AND WARRANTIES 34
SECTION 7.1. Representations and Warranties of the Borrower 34
ARTICLE VIII AFFIRMATIVE AND NEGATIVE COVENANTS 38
SECTION 8.1. Affirmative Covenants of the Borrower 38
SECTION 8.2. Negative Covenants of the Borrower 42
ARTICLE IX EVENTS OF DEFAULT 46
SECTION 9.1. Events of Default 46
PAGE
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SECTION 9.2. Cancellation/Acceleration 48
ARTICLE X THE ADMINISTRATIVE AGENT 49
SECTION 10.1. Appointment 49
SECTION 10.2. Delegation of Duties 49
SECTION 10.3. Exculpatory Provisions 49
SECTION 10.4. Reliance by Administrative Agent 50
SECTION 10.5. Notice of Default 50
SECTION 10.6. Non-Reliance on Administrative Agent and Other Banks 50
SECTION 10.7. Indemnification 51
SECTION 10.8. Administrative Agent in Its Individual Capacity 51
SECTION 10.9. Successor Administrative Agent 51
SECTION 10.10 52
ARTICLE XI MISCELLANEOUS 52
SECTION 11.1. Amendments and Waivers 52
SECTION 11.2. Notices 53
SECTION 11.3. No Waiver; Cumulative Remedies 54
SECTION 11.4. Survival of Representations and Warranties 54
SECTION 11.5. Payment of Expenses and Taxes; Indemnity 54
SECTION 11.6. Effectiveness; Successors and Assigns; Participations; Assignments 55
SECTION 11.7. Setoff 58
SECTION 11.8. Counterparts 58
SECTION 11.9. Severability 58
SECTION 11.10. Integration 58
SECTION 11.11. GOVERNING LAW 58
SECTION 11.12. Submission to Jurisdiction; Waivers 59
SECTION 11.13. Acknowledgments 60
SECTION 11.14. Limitation on Agreements 60
EXHIBITS AND SCHEDULES
Exhibit 1.1 -- Form of Pledge Agreement
Exhibit 1.2 -- Form of Supplemental Indenture
Exhibit 2.2 -- Notice of Borrowing
Exhibit 4.6 -- Notice of Interest Conversion/Continuation
Exhibit 11.6(c) -- Assignment and Acceptance
Exhibit 11.6(h) -- Form of Note
Schedule 1.1 -- Schedule of Commitments and Addresses
Schedule 1.1(A) -- Significant Subsidiaries
Schedule 6.1(c) -- Ownership of Capital Stock of Subsidiaries
Schedule 7.1(q) -- UCC Filing Jurisdictions
CREDIT AGREEMENT
This Credit Agreement, dated as of November 12, 2002 (this "Agreement"),
among CenterPoint Energy Houston Electric, LLC, a Texas limited liability
company (the "Borrower"), the banks and other lenders from time to time parties
hereto (individually, a "Bank" and, collectively, the "Banks"), and Credit
Suisse First Boston, as administrative agent (in such capacity, together with
any successors thereto in such capacity, the "Administrative Agent").
NOW, THEREFORE, in consideration of the premises of the mutual agreements,
representations and warranties herein set forth, and for other good and valuable
consideration, the parties hereto agree as follows:
ARTICLE I
DEFINITIONS AND ACCOUNTING TERMS
SECTION 1.1. Certain Defined Terms. As used in this Agreement, the
following terms shall have the following meanings:
"ABR" or "Alternate Base Rate" means, for any day, an alternate base
rate calculated as a fluctuating rate per annum as shall be in effect from
time to time, equal to the greatest of:
(a) the Prime Rate in effect on such day;
(b) the Federal Funds Effective Rate in effect on such day plus
1/2 of 1%; and
(c) 4.00%.
As used in this definition, the term "Prime Rate" means the rate of
interest per annum announced from time to time by the Administrative Agent
as its prime rate in effect at its principal office in New York City. If
for any reason the Administrative Agent shall have determined (which
determination shall be conclusive absent manifest error) that it is unable
to ascertain the Federal Funds Effective Rate, for any reason, including
the inability or failure of the Administrative Agent to obtain sufficient
quotations in accordance with the terms hereof, the ABR shall be determined
without regard to clause (b) above until the circumstances giving rise to
such inability no longer exist. Any change in the ABR due to a change in
the Prime Rate or the Federal Funds Effective Rate shall be effective as of
the effective day of such change in the Prime Rate or the Federal Funds
Effective Rate, respectively.
"ABR Loan" means a Loan that bears interest at the ABR as provided in
Section 4.3(a).
"Administrative Agent" has the meaning specified in the introduction
to this Agreement.
"Affiliate" means any Person that, directly or indirectly, Controls or
is Controlled by or is under common Control with another Person.
"Asset Sale" means any Disposition of Property or series of related
Dispositions of Property that yields Net Cash Proceeds to the Borrower or
any of its Subsidiaries (valued at the initial principal amount thereof in
the case of non-cash proceeds consisting of notes or other debt securities
and valued at fair market value in the case of other non-cash proceeds).
"Assignment and Acceptance" has the meaning specified in Section
11.6(c).
"Bank" and "Banks" have the meanings specified in the introduction to
this Agreement.
"Bank Affiliate" means, (a) with respect to any Bank (i) an Affiliate
of such Bank that is a bank or (ii) any entity (whether a corporation,
partnership, trust or otherwise) that is engaged in making, purchasing,
holding or otherwise investing in bank loans and similar extensions of
credit in the ordinary course of its business and is administered or
managed by a Bank or an Affiliate of such Bank and (b) with respect to any
Bank that is a fund which invests in bank loans and similar extensions of
credit, any other fund that invests in bank loans and similar extensions of
credit and is managed by the same investment advisor as such Bank or by an
Affiliate of such investment advisor.
"Board" means the Board of Governors of the Federal Reserve System of
the United States (or any successor thereto).
"Borrowed Money" of any Person means any Indebtedness of such Person
for or in respect of money borrowed or raised by whatever means (including
acceptances, deposits, lease obligations under Capital Leases, Mandatory
Payment Preferred Stock and synthetic leases); provided, however, that
Borrowed Money shall not include (a) any guarantees that may be incurred by
endorsement of negotiable instruments for deposit or collection in the
ordinary course of business or similar transactions, (b) any obligations or
guarantees of performance of obligations under a franchise, performance
bonds, franchise bonds, obligations to reimburse drawings under letters of
credit issued in accordance with the terms of any safe harbor lease or
franchise or in lieu of performance or franchise bonds or other obligations
incurred in the ordinary course of business that do not represent money
borrowed or raised, in each case to the extent that such reimbursement
obligations are payable in full within ten (10) Business Days after the
date upon which such obligation arises, (c) trade payables, (d) any
obligations of such Person under Swap Agreements, (e) customer advance
payments and deposits arising in the ordinary course of business or (f)
operating leases.
"Borrower" has the meaning specified in the introduction to this
Agreement.
"Business Day" means a day other than a Saturday, Sunday or other day
on which commercial banks in New York City are authorized or required by
law to close; provided that when used in connection with a LIBOR Rate Loan,
the term "Business Day" shall
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also exclude any day on which commercial banks are not open for dealings in
Dollar deposits in the London interbank market.
"Capital Lease" means a lease that, in accordance with GAAP, would be
recorded as a capital lease on the balance sheet of the lessee.
"Capital Stock" means any and all shares, interests, participations or
other equivalents (however designated) of capital stock of a corporation,
and any and all equivalent ownership interests in a Person (other than a
corporation), including without limitation, partnership interests in
partnerships and member interests in limited liability companies, and any
and all warrants or options to purchase any of the foregoing or securities
convertible into any of the foregoing.
"Cash Equivalents" means (a) marketable direct obligations issued by,
or unconditionally guaranteed by, the United States government or issued by
any agency thereof and backed by the full faith and credit of the United
States, in each case maturing within one year from the date of acquisition;
(b) certificates of deposit, time deposits, eurodollar time deposits or
overnight bank deposits having maturities of six months or less from the
date of acquisition issued by any Bank or by any commercial bank organized
under the laws of the United States or any state thereof having combined
capital and surplus of not less than $500,000,000; (c) commercial paper of
an issuer rated at least A-1 by S&P or P-1 by Xxxxx'x, or carrying an
equivalent rating by a nationally recognized rating agency, if both of the
two named rating agencies cease publishing ratings of commercial paper
issuers generally, and maturing within six months from the date of
acquisition; (d) repurchase obligations of any Bank or of any commercial
bank satisfying the requirements of clause (b) of this definition, having a
term of not more than 30 days, with respect to securities issued or fully
guaranteed or insured by the United States government; (e) securities with
maturities of one year or less from the date of acquisition issued or fully
guaranteed by any state, commonwealth or territory of the United States, by
any political subdivision or taxing authority of any such state,
commonwealth or territory or by any foreign government, the securities of
which state, commonwealth, territory, political subdivision, taxing
authority or foreign government (as the case may be) are rated at least A
by S&P or A by Xxxxx'x; (f) securities with maturities of six months or
less from the date of acquisition backed by standby letters of credit
issued by any Bank or any commercial bank satisfying the requirements of
clause (b) of this definition; (g) money market mutual or similar funds
that invest exclusively in assets satisfying the requirements of clauses
(a) through (f) of this definition; or (h) money market funds that (i)
comply with the criteria set forth in SEC Rule 2a-7 under the Investment
Company Act of 1940, as amended, (ii) are rated AAA by S&P and Aaa by
Xxxxx'x and (iii) have portfolio assets of at least $5,000,000,000.
"CenterPoint" means CenterPoint Energy, Inc., a Texas corporation and
utility holding company owning, through Subsidiaries, the Borrower and its
Subsidiaries.
"CenterPoint Credit Agreement" means the $3,850,000,000 Credit
Agreement, dated as of October 10, 2002, among CenterPoint, as borrower,
JPMorgan Chase Bank, as administrative agent, and the other financial
institutions parties thereto, as amended,
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modified, supplemented, refinanced or replaced from time to time (without
modifying the mandatory prepayment provisions of Section 5.7 thereof (or
any similar sections of any refinancing or replacing facility) to increase
the amounts that would be prepaid thereunder from the proceeds of Asset
Sales, Capital Stock issuances or debt incurrences, in each case by the
Borrower and its Subsidiaries or Securitization Subsidiaries, from the
provisions of such Section 5.7 as in effect on the date hereof).
"CenterPoint Credit Facility" means the credit facilities provided
under the CenterPoint Credit Agreement.
"Change in Control" means (i) with respect to CenterPoint, the
acquisition by any Person or "group" (within the meaning of Rule 13d-5 of
the Exchange Act) of beneficial ownership (determined in accordance with
Rule 13d-3 of the Exchange Act) of Capital Stock of CenterPoint, the result
of which is that such Person or group beneficially owns 30% or more of the
aggregate voting power of all then issued and outstanding Capital Stock of
CenterPoint or (ii) CenterPoint shall cease to own and control, of record
and beneficially, directly or indirectly, 100% of each class of outstanding
Capital Stock of the Borrower free and clear of all Liens. For purposes of
the foregoing, the phrase "voting power" means, with respect to an issuer,
the power under ordinary circumstances to vote for the election of members
of the board of directors of such issuer.
"Closing Date" means the date, on or before November 15, 2002, all the
conditions set forth in Section 6.1 are satisfied (or waived) in accordance
with the terms hereof.
"Code" means the Internal Revenue Code of 1986, as amended from time
to time, and any successor statute.
"Collateral" has the meaning assigned to such term in the Pledge
Agreement.
"Commitment" means, as to any Bank, the obligation of such Bank to
make a Loan to the Borrower in a principal amount not to exceed the amount
set forth under the heading "Commitment" opposite such Bank's name on
Schedule 1.1. The aggregate amount of the Commitments is $1,310,000,000.
"Commonly Controlled Entity" means an entity, whether or not
incorporated, that is under common control with the Borrower within the
meaning of Section 4001 of ERISA or is part of a group that includes the
Borrower and that is treated as a single employer under Section 414 of the
Code.
"Confidential Information Memorandum" means the Confidential
Information Memorandum, dated October 2002 and furnished to certain Banks,
as supplemented prior to the date hereof.
"Consolidated Capitalization" means, as of any date of determination,
the sum of (a) Consolidated Shareholders' Equity, (b) Consolidated
Indebtedness for Borrowed Money and, without duplication, (c) Mandatory
Payment Preferred Stock; provided that for the purpose of calculating
compliance with Section 8.2(a), Consolidated
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Capitalization shall be determined excluding any adjustment, non-cash
charge to net income or other non-cash charges or writeoffs resulting
thereto from application of SFAS No. 142.
"Consolidated Indebtedness" means, as of any date of determination,
the sum of (i) the total Indebtedness as shown on the consolidated balance
sheet of the Borrower and its Consolidated Subsidiaries, determined without
duplication of any Guarantee of Indebtedness of the Borrower by any of its
Consolidated Subsidiaries or of any Guarantee of Indebtedness of any such
Consolidated Subsidiary by the Borrower or any other Consolidated
Subsidiary of the Borrower, plus (ii) any Mandatory Payment Preferred
Stock.
"Consolidated Shareholders' Equity" means, as of any date of
determination, the total assets of the Borrower and its Consolidated
Subsidiaries, less all liabilities of the Borrower and its Consolidated
Subsidiaries. As used in this definition, "liabilities" means all
obligations that, in accordance with GAAP consistently applied, would be
classified on a balance sheet as liabilities (including without limitation
(to the extent so classified), (a) Indebtedness; (b) deferred liabilities;
and (c) Indebtedness of the Borrower or any of its Consolidated
Subsidiaries that is expressly subordinated in right and priority of
payment to other liabilities of the Borrower or such Consolidated
Subsidiary, but in any case excluding as at such date of determination any
Junior Subordinated Debt owned by any Hybrid Preferred Securities
Subsidiary).
"Consolidated Subsidiary" means, with respect to a specified Person at
any date, any Subsidiary or any other Person, the accounts of which under
GAAP would be consolidated with those of such specified Person in its
consolidated financial statements as of such date.
"Contractual Obligation" means, as to any Person, any provision of any
security issued by such Person or of any written agreement, instrument or
other written undertaking to which such Person is a party or by which it or
any of its property is bound.
"Controlled" means, with respect to any Person, the ability of another
Person (whether directly or indirectly and whether by the ownership of
voting securities, contract or otherwise) to appoint and/or remove the
majority of the members of the board of directors or other governing body
of that Person (and "Control" shall be similarly construed).
"Default" means any event that, with the lapse of time or giving of
notice, or both, or any other condition, would constitute an Event of
Default.
"Default Rate" means with respect to any overdue amount owed
hereunder, a rate per annum equal to (a) in the case of overdue principal
with respect to any Loan, the sum of the interest rate in effect at such
time with respect to such Loan under Section 4.3, plus 2%; provided that
in the case of overdue principal with respect to any LIBOR Rate Loan, after
the end of the Interest Period with respect to such Loan, the Default Rate
shall equal the rate set forth in clause (b) below and (b) in the case of
overdue interest with respect to
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any LIBOR Rate Loan or other amounts payable hereunder, the sum of the
interest rate for ABR Loans in effect at such time plus 2%.
"Disposition" means with respect to any Property (excluding cash and
Cash Equivalents), any sale, lease, sale and leaseback, assignment,
conveyance, transfer or other disposition thereof. The terms "Dispose" and
"Disposed of" shall have correlative meanings.
"Dollars" and the symbol "$" mean the lawful currency of the United
States of America.
"ERISA" means the Employee Retirement Income Security Act of 1974, as
amended from time to time.
"Event of Default" has the meaning specified in Section 9.1.
"Exchange Act" means the Securities Exchange Act of 1934, as amended.
"Excluded Asset Sales" means the following Dispositions of Property or
series of related Dispositions of Property: (i) Permitted Asset Swaps; (ii)
the sale or Disposition in the ordinary course of business of inventory,
accounts receivable (in respect of the collection thereof) and obsolete
assets; (iii) leases entered into in the ordinary course of business; (iv)
non-exclusive license of patents, trademarks, registrations therefor and
other similar intellectual property in the ordinary course of business; (v)
intercompany Dispositions among the Borrower and its Subsidiaries in the
ordinary course of business; (vi) sale leaseback transactions entered into
by the Borrower or any of its Subsidiaries in the ordinary course of
business and (vii) Dispositions to or by Securitization Subsidiaries
consistent with the definition thereof.
"Excluded Transactions" means the incurrence or issuance by the
Borrower and its Subsidiaries of the following:
(a) Indebtedness in respect of any refinancing, refundings,
renewals or extensions (on or prior to the maturity thereof) of
(without any increase in the principal amount thereof plus any
expenses (including any redemption premium or penalty) or any
shortening of the final maturity thereof) Indebtedness outstanding on
the Closing Date (excluding Indebtedness in respect of the Reliant
Energy FinanceCo II LP 7.40% Senior Notes due November 15, 2002 and
the Existing Credit Facilities);
(b) Intercompany Indebtedness;
(c) Indebtedness permitted hereunder to the extent constituting
(i) the issuance by the Borrower or any of its Subsidiaries of
commercial paper, (ii) any backup credit or liquidity facilities in
respect of any such commercial paper issuance, (iii) other short-term
instruments in lieu of the issuance of commercial paper, (iv) letters
of credit issued for the account of the Borrower or any of its
Subsidiaries in respect of any of the foregoing and (v) drawings on
letters of
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credit, bonds or similar obligations permitted under this Agreement if
the proceeds are applied to the underlying obligation secured or
supported thereby;
(d) Indebtedness of the Borrower in respect of the Loans and the
Pledged Bonds;
(e) Indebtedness in respect of performance, surety and similar
bonds and completion guarantees provided by the Borrower or any of its
Subsidiaries in the ordinary course of business;
(f) Indebtedness in respect of Capital Leases entered into by the
Borrower or any of its Subsidiaries in the ordinary course of
business;
(g) Indebtedness in respect of Swap Agreements entered into in
the ordinary course of business and not entered into for speculative
purposes;
(h) Capital Stock to employees, directors or consultants of the
Borrower or any of its Subsidiaries under, or upon the exercise of any
warrants, options, conversion rights or other rights in respect of,
any employee stock option plan, other employee benefit or compensation
plans, dividend reinvestment plans, including CenterPoint's Investors
Choice Plan, or arrangements of the Borrower or any of its
Subsidiaries existing on the Closing Date;
(i) Capital Stock issued by any Subsidiary of the Borrower solely
to the Borrower or any of its Subsidiaries;
(j) Capital Stock of the Borrower to the extent issued as
consideration to effect acquisitions permitted under Section 8.2(g)
and expenses incurred in connection therewith; and
(k) Indebtedness incurred by the Borrower or any of its
Subsidiaries after the date hereof at any time outstanding in
aggregate principal amount not to exceed $300,000,000.
"Existing Credit Agreement" means the $850,000,000 Credit Agreement,
dated as of October 10, 2002, among the Borrower, as the borrower, JPMorgan
Chase Bank, as administrative agent, Citibank, N.A., as syndication agent,
and the other financial institutions parties thereto, as amended, modified
or supplemented from time to time.
"Existing Credit Facilities" means the credit facilities provided
under the Existing Credit Agreement.
"Facility" means the Commitments and the Loans made thereunder.
"Federal Funds Effective Rate" means, for any day, a fluctuating 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, as published on the next succeeding Business Day by
the Federal Reserve Bank of New York, or, if
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such rate is not so published for any day that is a Business Day, the
average of the quotations for such day for such transactions received by
the Administrative Agent from three federal funds brokers of recognized
standing selected by the Borrower.
"FinanceCo" means Reliant Energy FinanceCo II LP.
"FinanceCo Permitted Facilities" means the $300,000,000 of FinanceCo
7.40% Senior Notes due November 15, 2002, issued pursuant to the Fiscal
Agency Agreement dated as of November 12, 1999, among FinanceCo, Reliant
Energy, Incorporated and Chase Bank of Texas, National Association.
"FinanceCo Permitted Refinancing" means the repayment, at maturity, by
FinanceCo of the FinanceCo Permitted Facilities, together with accrued and
unpaid interest thereon, with proceeds of the Loans either used by the
Borrower to redeem preference shares of the Borrower held by FinanceCo or
otherwise advanced to FinanceCo.
"Fitch" means Fitch Ratings and any successor rating agency.
"Funding Office" means the office of the Administrative Agent
specified in Section 11.2 or such other office as may be specified from
time to time by the Administrative Agent as its funding office by written
notice to the Borrower and the Banks.
"GAAP" means generally accepted accounting principles in effect from
time to time in the United States of America.
"Governmental Authority" means any nation or government, any state or
other political subdivision thereof and any entity exercising executive,
legislative, judicial, regulatory or administrative functions of or
pertaining to government.
"Guarantee" means, as to any Person (the "guaranteeing Person"), any
obligation of (a) the guaranteeing Person or (b) another Person (including,
without limitation, any bank under any letter of credit) to induce the
creation of which the guaranteeing person has issued a reimbursement,
counterindemnity or similar obligation, in either case guaranteeing or in
effect guaranteeing any principal of any Indebtedness for Borrowed Money
(the "primary obligation") of any other third Person in any manner, whether
directly or indirectly, including, without limitation, any obligation of
the guaranteeing Person, whether or not contingent, (i) to purchase any
such primary obligation or any property constituting direct or indirect
security therefor, (ii) to advance or supply funds for the purchase or
payment of any such primary obligation or (iii) otherwise to assure or hold
harmless the owner of any such primary obligation against loss in respect
thereof. The amount of any Guarantee of any guaranteeing person shall be
deemed to be the lower of (a) an amount equal to the stated or determinable
amount of the primary obligation in respect of which such Guarantee is made
and (b) the maximum amount for which such guaranteeing person may be liable
pursuant to the terms of the instrument embodying such Guarantee, unless
such primary obligation and the maximum amount for which such guaranteeing
person may be liable are not stated or determinable, in which case the
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amount of such Guarantee shall be such guaranteeing person's maximum
reasonably anticipated liability in respect thereof as determined by the
Borrower in good faith (and "guaranteed" and "guarantor" shall be construed
accordingly).
"Highest Lawful Rate" means, with respect to each Bank, the maximum
nonusurious interest rate, if any, that at any time or from time to time
may be contracted for, taken, reserved, charged or received with respect to
any Loan or on other amounts, if any, due to such Bank pursuant to this
Agreement or any other Loan Document under applicable law. "Applicable law"
as used in this definition means, with respect to each Bank, that law in
effect from time to time that permits the charging and collection by such
Bank of the highest permissible lawful, nonusurious rate of interest on the
transactions herein contemplated including, without limitation, the laws of
each State that may be held to be applicable, and of the United States of
America, if applicable.
"Hybrid Preferred Securities" means preferred stock issued by any
Hybrid Preferred Securities Subsidiary.
"Hybrid Preferred Securities Subsidiary" means any Delaware business
trust (or similar entity) (i) all of the common equity interest of which is
owned (either directly or indirectly through one or more Wholly-Owned
Subsidiaries) at all times by the Borrower, (ii) that has been formed for
the purpose of issuing Hybrid Preferred Securities and (iii) substantially
all of the assets of which consist at all times solely of the Junior
Subordinated Debt and payments made from time to time on the Junior
Subordinated Debt.
"Indebtedness" of any Person means the sum of (a) all items (other
than Capital Stock, capital surplus and retained earnings) that, in
accordance with GAAP consistently applied, would be included in determining
total liabilities as shown on the liability side of a balance sheet of such
Person as at the date on which the Indebtedness is to be determined, (b)
all obligations of the Borrower or any Subsidiary, contingent or otherwise,
as account party or applicant (or equivalent status) in respect of any
standby letters of credit or equivalent instruments, and (c) without
duplication, the amount of all Guarantees by such Person of items described
in clauses (a) and (b); provided, however, that Indebtedness of a Person
shall not include (i) any Junior Subordinated Debt owned by any Hybrid
Preferred Securities Subsidiary, (ii) any Guarantee by the Borrower of
payments with respect to any Hybrid Preferred Securities or (iii) any
Securitization Securities.
"Insolvency" means, with respect to any Multiemployer Plan, the
condition that such Plan is insolvent within the meaning of Section 4245 of
ERISA (and "Insolvent" shall be construed accordingly for such purposes).
"Interest Period" means, for each LIBOR Rate Loan, the period
commencing on the date of such LIBOR Rate Loan or the date of the
conversion of any Loan into such LIBOR Rate Loan, as the case may be, and
ending on the last day of the period selected by the Borrower pursuant to
Section 2.2 or 4.6, as the case may be, and, thereafter, each subsequent
period commencing on the last day of the immediately preceding Interest
9
Period and ending on the last day of the period selected by the Borrower
pursuant to Section 4.6. The duration of each such Interest Period shall be
one, two, three, six or, with the consent of all the Banks, nine or twelve
months or periods shorter than one month, as the Borrower may select by
notice pursuant to Section 2.2(a) or 4.6 hereof; provided, however, that:
(i) any Interest Period in respect of a Loan that would otherwise
extend beyond the Maturity Date shall end on the Maturity Date;
(ii) whenever the last day of any Interest Period would otherwise
occur on a day other than a Business Day, the last day of such
Interest Period shall be extended to occur on the next succeeding
Business Day; provided that if such extension would cause the last day
of such Interest Period to occur in the next following calendar month,
the last day of such Interest Period shall occur on the next preceding
Business Day; and
(iii) any Interest Period that begins on the last Business Day of
a calendar month (or on a day for which there is no numerically
corresponding day in the calendar month at the end of such Interest
Period) shall end on the last Business Day of a calendar month.
"Investment" has the meaning specified in Section 8.2(g).
"Junior Subordinated Debt" means subordinated debt of the Borrower or
any Subsidiary of the Borrower (i) that is issued at par to a Hybrid
Preferred Securities Subsidiary in connection with the issuance of Hybrid
Preferred Securities, (ii) the payment of the principal of which and
interest on which is subordinated (with certain exceptions) to the prior
payment in full in cash or its equivalent of all senior indebtedness of the
obligor thereunder and (iii) that has an original tenor no earlier than 30
years from the issuance thereof.
"Lead Arranger" means Credit Suisse First Boston, in its capacity as
sole lead arranger and bookrunner.
"LIBOR Rate" means with respect to any LIBOR Rate Loan for any
Interest Period, the rate per annum determined by the Administrative Agent
at approximately 11:00 a.m. (London time) on the date that is two Business
Days prior to the beginning of the relevant Interest Period by reference to
the British Bankers' Association Interest Settlement Rates for deposits in
dollars (as set forth by the Bloomberg Information Service or any successor
thereto or any other service selected by the Administrative Agent that has
been nominated by the British Bankers' Association as an authorized
information vendor for the purpose of displaying such rates) for a period
equal to such Interest Period; provided that, to the extent that an
interest rate is not ascertainable pursuant to the foregoing provisions of
this definition, the "LIBOR Rate" shall be the interest rate per annum
determined by the Administrative Agent to be the average of the rates per
annum at which deposits in dollars are offered for such relevant Interest
Period to major banks in the London interbank market in London, England by
the
10
Administrative Agent at approximately 11:00 a.m. (London time) on the date
that is two Business Days prior to the beginning of such Interest Period;
provided further that, if the LIBOR Rate determined as provided above with
respect to any Loan for any Interest Period would be less than 3.00% per
annum, then the "LIBOR Rate" with respect to such Loan for such Interest
Period shall be deemed to be 3.00% per annum.
"LIBOR Rate Loan" means a Loan that bears interest at the LIBOR Rate
as provided in Section 4.3(b).
"Lien" means any mortgage, deed of trust, pledge, hypothecation,
assignment, deposit arrangement, charge, security interest, encumbrance or
lien of any kind whatsoever (including any Capital Lease).
"Loans" means the loans made by the Banks to the Borrower pursuant to
this Agreement.
"Loan Documents" means this Agreement, the Pledge Agreement, any
Notes, the Second Mortgage Indenture, the Pledged Bonds and any document or
instrument executed in connection with the foregoing.
"Long-Term Debt Rating" means the rating assigned by a Rating Agency
to the long-term senior unsecured debt securities of CenterPoint or the
Borrower (it being understood that a change in outlook status (e.g., watch
status, negative outlook status) is not a change in rating as contemplated
hereby).
"Majority Banks" means, at any time, Banks having in excess of 50% of
(a) until the Closing Date, the Commitments then in effect and (b)
thereafter, the aggregate unpaid principal amount of Loans then outstanding
at such time; provided that if a single Bank, together with its Bank
Affiliates, has in excess of 50%, but less than 100%, of (x) such
Commitments then in effect or (y) such aggregate unpaid principal amount of
Loans then outstanding, then "Majority Banks" shall mean such Bank plus at
least one other Bank that is not a Bank Affiliate of such Bank.
"Mandatory Payment Preferred Stock" means any preference or preferred
stock of the Borrower or of any Consolidated Subsidiary (in each case other
than (x) any preference or preferred stock issued to the Borrower or its
Subsidiaries, (y) Hybrid Preferred Securities and (z) Junior Subordinated
Debt) that is subject to mandatory redemption, sinking fund or retirement
provisions (regardless of whether any portion thereof is due and payable
within one year).
"Margin Stock" has the meaning assigned to such term in Regulation U
or X, as the case may be.
"Material Adverse Effect means any material adverse effect on (a) the
business, financial condition or operations of the Borrower and its
Consolidated Subsidiaries, taken as a whole, (b) the legality, validity or
enforceability of the Loan Documents or (c) the perfection or priority of
the Lien of the Second Mortgage Indenture or the Pledge Agreement.
11
"Maturity Date" means (a) November 11, 2005 or (b) any earlier date on
which all unpaid principal amounts of the Loans hereunder have been
declared due and payable in accordance with this Agreement.
"Moody's" means Xxxxx'x Investors Service, Inc. and any successor
rating agency.
"Mortgage" means the Mortgage and Deed of Trust dated as of November
1, 1944 by the Borrower to South Texas Commercial National Bank of Houston,
as Trustee (JPMorgan Chase Bank, successor Trustee), as amended and
supplemented from time to time.
"Mortgaged Property" has the meaning assigned to such term in the
Second Mortgage Indenture.
"Multiemployer Plan" means a Plan that is a multiemployer plan as
defined in Section 4001(a)(3) of ERISA.
"Net Cash Proceeds" means (a) as consideration for any Asset Sale or
any Recovery Event, the proceeds thereof in the form of cash and cash
equivalents (including any such proceeds received by way of deferred
payment of principal pursuant to a note or installment receivable or
purchase price adjustment receivable or otherwise, but only as and when
received) of such Asset Sale or Recovery Event, net of brokerage fees,
attorneys' fees, accountants' fees, investment banking fees, amounts
required to be applied to the repayment of Indebtedness or other obligation
or pursuant to Contractual Obligations of the Borrower or any of its
Subsidiaries existing on the Closing Date and other customary fees and
expenses actually incurred in connection therewith and net of taxes paid or
reasonably estimated to be payable as a result thereof (after taking into
account any available tax credits or deductions and any tax sharing
arrangements), all distributions and payments required to be made to
minority interest holders in Subsidiaries as a result of such Asset Sale
and deduction of amounts established by the Borrower or any of its
Subsidiaries as a reserve for liabilities retained by the Borrower or any
of its Subsidiaries after such Asset Sale, which liabilities are associated
with the asset or assets being sold or otherwise retained in connection
with such transaction, including, without limitations, in respect of the
sale price of such asset or assets, pension and other post-employment
benefit liabilities and liabilities related to environmental matters or
against any indemnification obligations or other retained liabilities or
obligations associated with such Asset Sale and (b) in connection with any
issuance or sale of Capital Stock or any incurrence of Indebtedness, the
cash proceeds received from such issuance or incurrence, net of attorneys'
fees, investment banking fees, accountants' fees, underwriting discounts,
escrow fees reserves, related swap costs and commissions and other
customary fees and expenses actually incurred in connection therewith and
other similar payment obligations resulting therefrom (other than the
obligations under this Agreement) that are required to be repaid
concurrently or otherwise as a result of such issuance or incurrence.
"Note" means the collective reference to any promissory note
evidencing Loans.
12
"Notice of Borrowing" has the meaning specified in Section 2.2(a).
"Notice of Interest Conversion/Continuation" has the meaning specified
in Section 4.6(a).
"Other Taxes" has the meaning specified in Section 5.3(b).
"Participant" has the meaning specified in Section 11.6(b).
"PBGC" means the Pension Benefit Guaranty Corporation established
pursuant to Subtitle A of Title IV of ERISA or any successor.
"Permitted Asset Swaps" means substantially contemporaneous purchases
or exchanges of Property (other than cash or cash equivalents) owned by a
Person that is not the Borrower or an Affiliate of the Borrower for
Property of substantially equivalent value owned by the Borrower or any of
its Subsidiaries.
"Permitted Liens" means with respect to any Person:
(a) Liens for current taxes, assessments or other governmental charges
that are not delinquent or remain payable without any penalty, or the
validity or amount of which is contested in good faith by appropriate
proceedings, provided, however, that, adequate reserves with respect
thereto are maintained on the books of such Person in accordance with GAAP,
and provided, further, that, subject to Section 8.1(d), any right to
seizure, levy, attachment, sequestration, foreclosure or garnishment with
respect to Property of such Person or any Subsidiary of such Person by
reason of such Lien has not matured, or has been, and continues to be,
effectively enjoined or stayed;
(b) landlord Liens for rent not yet due and payable and Liens for
materialmen, mechanics, warehousemen, carriers, employees, workmen,
repairmen and other similar nonconsensual Liens imposed by operation of
law, for current wages or accounts payable or other sums not yet
delinquent, in each case arising in the ordinary course of business,
provided, however, that, subject to Section 8.1(d), any right to seizure,
levy, attachment, sequestration, foreclosure or garnishment with respect to
Property of such Person or any Subsidiary of such Person by reason of such
Lien has not matured, or has been, and continues to be, effectively
enjoined or stayed;
(c) Liens (other than any Lien imposed pursuant to Section 401(a)(29)
or 412(n) of the Code, ERISA or any environmental law, order, rule or
regulation) incurred or deposits made, in each case, in the ordinary course
of business, (i) in connection with workers' compensation, unemployment
insurance and other types of social security or (ii) to secure (or to
obtain letters of credit that secure) the performance of tenders, statutory
obligations, surety and appeal bonds, bids, leases, performance or payment
bonds, purchase, construction, sales contracts and other similar
obligations, in each case not incurred or made in connection with the
borrowing of money, the obtaining of advances or credit or the payment of
the deferred purchase price of property;
13
(d) Liens arising out of or in connection with any litigation or other
legal proceeding that is being contested in good faith by appropriate
proceedings; provided, however, that adequate reserves with respect thereto
are maintained on the books of such Person in accordance with GAAP; and
provided, further, that, subject to Sections 8.1(d) and 9.1(i) (so long as
such lien is discharged or released within 90 days of attachment thereof),
any right to seizure, levy, attachment, sequestration, foreclosure or
garnishment with respect to Property of such Person or any Subsidiary of
such Person by reason of such Lien has not matured, or has been, and
continues to be, effectively enjoined or stayed;
(e) precautionary filings under the applicable Uniform Commercial Code
made by a lessor with respect to personal property leased to such Person or
any Subsidiary of such Person;
(f) other minor Liens or encumbrances none of which secures Borrowed
Money or interferes materially with the use of the Property affected in the
ordinary conduct of Borrower's or its Subsidiaries' business and which
individually or in the aggregate do not have a Material Adverse Effect;
(g) easements, rights-of-way, restrictions and other similar
encumbrances incurred in the ordinary course of business that, in the
aggregate, do not in any case materially detract from the value of the
property subject thereto or materially interfere with the ordinary conduct
of the business of the Borrower and its Subsidiaries, taken as a whole;
(h) (i) Liens created by Capital Leases provided that the Liens
created by any such Capital Lease attach only to the Property leased to the
Borrower or one of its Subsidiaries pursuant thereto, (ii) purchase money
Liens securing Indebtedness (including such Liens securing Indebtedness
incurred within 12 months of the date on which such Property was acquired)
provided that all such Liens attach only to the Property purchased with the
proceeds of the Indebtedness secured thereby and only secure the
Indebtedness incurred to finance such purchase, (iii) Liens on receivables,
customer charges, notes, ownership interests, contracts or contract rights
created in connection with a sale, securitization or monetization of such
receivables, customer charges, notes, ownership interests, contracts or
contract rights, and Liens on rights of the Borrower or any Subsidiary
related to such receivables, customer charges, notes, ownership interests,
contracts or contract rights which are transferred to the purchaser of such
receivables, customer charges, notes, ownership interests, contracts or
contract rights in connection with such sale, securitization or
monetization, provided that such Liens secure only the obligations of the
Borrower or any of its Subsidiaries in connection with such sale,
securitization or monetization and (iv) Liens created by leases that do not
constitute Capital Leases at the time such leases are entered into provided
that the Liens created thereby attach only to the Property leased to the
Borrower or one of its Subsidiaries pursuant thereto;
(i) Liens on cash and short-term investments (i) deposited by the
Borrower or any of its Subsidiaries in margin accounts with or on behalf of
futures contract brokers or
14
other counterparties or (ii) pledged by the Borrower or any of its
Subsidiaries, in the case of clause (i) or (ii) to secure its obligations
with respect to contracts (including without limitation, physical delivery,
option (whether cash or financial), exchange, swap and futures contracts)
for the purchase or sale of any energy-related commodity or interest rate
or currency rate management contracts; and
(j) Liens on (i) Property owned by a Project Financing Subsidiary or
(ii) equity interests in a Project Financing Subsidiary (including in each
case a pledge of a partnership interest, common stock or a membership
interest in a limited liability company) securing Indebtedness incurred in
connection with a Project Financing.
"Person" means an individual, partnership, corporation (including a
business trust), joint stock company, trust, unincorporated association,
joint venture, government (or any political subdivision or agency thereof)
or any other entity of whatever nature.
"Plan" means, at a particular time with respect to the Borrower, any
employee benefit plan that is covered by ERISA and in respect of which the
Borrower or a Commonly Controlled Entity is (or, if such plan were
terminated at such time, would under Section 4069 of ERISA be deemed to be)
an "employer" as defined in Section 3(5) of ERISA.
"Pledge Agreement" means the Pledge Agreement to be executed and
delivered by the Borrower and the Administrative Agent, substantially in
the form of Exhibit 1.1.
"Pledged Bonds" has the meaning assigned to such term in the Pledge
Agreement.
"Project Financing" means any Indebtedness or lease obligations that
do not constitute Capital Leases at the time such leases are entered into,
in each case that are incurred to finance a project or group of projects
(including any construction financing) to the extent that such Indebtedness
(or other obligations) expressly are not recourse to the Borrower or any of
its Subsidiaries (other than a Project Financing Subsidiary) or any of
their respective Property other than the Property of a Project Financing
Subsidiary and equity interests in a Project Financing Subsidiary
(including in each case a pledge of a partnership interest, common stock or
a membership interest in a limited liability company).
"Project Financing Subsidiary" means any Subsidiary of the Borrower
(or any other Person in which Borrower directly or indirectly owns a 50% or
less interest) whose principal purpose is to incur Project Financing or to
become an owner of interests in a Person so created to conduct the business
activities for which such Project Financing was incurred, and substantially
all the fixed assets of which Subsidiary or Person are those fixed assets
being financed (or to be financed) in whole or in part by one or more
Project Financings.
"Pro Rata Percentage" means, as to any Bank at any time, the
percentage which such Bank's Commitment then constitutes of the aggregate
Commitments (or, at any time after the Closing Date, the percentage which
the aggregate principal amount of such
15
Bank's Loans then outstanding constitutes of the aggregate principal amount
of the Loans then outstanding).
"Property" means any interest or right in any kind of property or
asset, whether real, personal or mixed, owned or leased, tangible or
intangible and whether now held or hereafter acquired.
"Purchasing Banks" has the meaning specified in Section 11.6(c).
"Rating Agencies" means (a) S&P; (b) Moody's; and (c) Fitch.
"Recovery Event" means any settlement of or payment in respect of any
Property or casualty insurance claim or any condemnation proceeding for any
asset or related assets of the Borrower or its Subsidiaries that yields Net
Cash Proceeds to the Borrower or any of its Subsidiaries (valued at the
initial principal amount thereof in the case of non-cash proceeds
consisting of notes or other debt securities and valued at fair market
value in the case of other non-cash proceeds) for any such settlement or
payment or series of related settlements or payments in excess of
$30,000,000.
"Register" has the meaning specified in Section 11.6(d) hereof.
"Regulation U" and "Regulation X" means Regulation U and X,
respectively, of the Board or any other regulation hereafter promulgated by
the Board to replace the prior Regulation U or X, as the case may be, and
having substantially the same function.
"Reinvestment Deferred Amount" means with respect to any Reinvestment
Event, the aggregate Net Cash Proceeds received by the Borrower or any of
its Subsidiaries in connection therewith that are not applied to prepay the
Loans pursuant to Section 5.6(b) as a result of the delivery of a
Reinvestment Notice.
"Reinvestment Event" means any Asset Sale or Recovery Event in respect
of which the Borrower or any of its Subsidiaries has delivered a
Reinvestment Notice.
"Reinvestment Notice" means a written notice executed by a Responsible
Officer stating that no Event of Default has occurred and is continuing and
that the Borrower (directly or indirectly through a Subsidiary) intends to
use all or a specified portion of the Net Cash Proceeds of an Asset Sale or
Recovery Event to repair or replace the affected Property or to acquire
Property useful in its or one of its Subsidiaries' business.
"Reinvestment Prepayment Amount" means with respect to any
Reinvestment Event, the Reinvestment Deferred Amount relating thereto less
any amount expended prior to the relevant Reinvestment Prepayment Date to
acquire or repair assets useful in the Borrower's or its Subsidiary's
business, as the case may be.
"Reinvestment Prepayment Date" means with respect to any Reinvestment
Event, the earlier of (a) the date occurring 180 days after such
Reinvestment Event and (b) the date on which the Borrower or one of its
Subsidiaries shall have determined not to, or shall have otherwise ceased
to, acquire, replace or repair assets useful in the
16
Borrower's or one of its Subsidiaries' business with all or any portion of
the relevant Reinvestment Deferred Amount.
"Reorganization" means, with respect to any Multiemployer Plan, the
condition that such Plan is in reorganization within the meaning of Section
4241 of ERISA.
"Reportable Event" means any of the events set forth in Section
4043(c) of ERISA and PBGC Reg. Section 4043, other than those events as to
which the thirty-day notice period is waived under subsections .27, .28,
.29, .30, .31, .32, .34, or .35 of PBGC Reg. Section 4043.
"Responsible Officer" means, with respect to any Person, its chief
financial officer, chief accounting officer, assistant treasurer, treasurer
or comptroller of such Person or any other officer of such Person whose
primary duties are similar to the duties of any of the previously listed
officers of such Person.
"S&P" means Standard & Poor's Ratings Group and any successor rating
agency.
"SEC" means the Securities and Exchange Commission and any successor
thereto.
"Second Mortgage Indenture" means the general mortgage indenture dated
October 10, 2002, as supplemented, between the Borrower and the Trustee.
"Secured Indebtedness" means, with respect to any Person, all
Indebtedness secured (or for which the holder of such Indebtedness has an
existing right, contingent or otherwise, to be secured) by any Lien on any
Property (including, without limitation, accounts and contract rights)
owned by such Person or any of its Subsidiaries, even though such Person
has not assumed or become liable for the payment of such Indebtedness.
"Securities Act" means the Securities Exchange Act of 1934, as
amended.
"Securitization Securities" means transition bonds issued pursuant to
the Texas Electric Choice Plan if (and only if) no recourse may be had to
the Borrower or any of its Subsidiaries (or to their respective assets) for
the payment of such obligations, other than the issuer of the bonds and its
assets, provided that, payment of such transition charges by any retail
electric provider ("REP") in accordance with such legislation, whether or
not such REP has collected such charges from the retail electric customers,
shall not be deemed "recourse" hereunder, including any REP that is a
division of an Affiliate of the Borrower or any Affiliate of the Borrower.
"Securitization Subsidiary" means a special purpose subsidiary created
to issue Securitization Securities.
"Significant Subsidiary" means (i) for the purposes of determining
what constitutes an "Event of Default" under Sections 9.1(g), (h), (i), (j)
and (k), a Subsidiary of the Borrower, whose total assets, as determined in
accordance with GAAP, represent
17
at least 10% of the total assets of the Borrower, on a consolidated basis,
as determined in accordance with GAAP and (ii) for all other purposes the
"Significant Subsidiaries" shall be those Subsidiaries whose total assets,
as determined in accordance with GAAP, represent at least 10% of the total
assets of the Borrower, on a consolidated basis, as determined in
accordance with GAAP, for the Borrower's most recently completed fiscal
year and identified in the certificate most recently delivered pursuant to
Section 8.1(a)(iv)(C); provided further that no Securitization Subsidiary
shall be deemed to be a Significant Subsidiary or subject to the
restrictions, covenants or Events of Default under this Agreement.
"Single Employer Plan" means any Plan that is covered by Title IV of
ERISA, but that is not a Multiemployer Plan.
"Solvent" means, as used in Section 7.1(s), with respect to any Person
on a particular date, the condition that on such date, (a) the fair value
of the property of such Person is greater than the total amount of
liabilities, including, without limitation, contingent liabilities, of such
Person, (b) the present fair salable value of the assets of such Person is
not less than the amount that will be required to pay the probable
liability of such Person on its debts as they become absolute and matured,
(c) such Person does not intend to, and does not believe that it will,
incur debts or liabilities beyond such Person's ability to pay as such
debts and liabilities mature, and (d) such Person is not engaged in
business or a transaction, and is not about to engage in business or a
transaction, for which such Person's property would constitute an
unreasonably small amount of capital. The term "Solvency" shall be
construed accordingly for such purpose.
"Subsidiary" means, as to any Person, a corporation, partnership,
limited liability company or other entity of which more than 50% of the
outstanding shares of Capital Stock or other ownership interests having
ordinary voting power (other than Capital Stock or such other ownership
interests having such power only by reason of the happening of a
contingency) to elect directors or other managers of such corporation,
partnership or other entity are at the time owned, directly or indirectly,
through one or more Subsidiaries of such Person, by such Person; provided,
however, that no Securitization Subsidiary shall be deemed to be a
Subsidiary for purposes of this Agreement.
"Supermajority Banks" means, at any time, Banks having in excess of 66
2/3% of (a) until the Closing Date, the Commitments then in effect and (b)
thereafter, the aggregate unpaid principal amount of Loans then
outstanding; provided that if a single Bank, together with its Bank
Affiliates, has in excess of 66 2/3%, but less than 100%, of (x) such
Commitments then in effect or (y) such aggregate unpaid principal amount of
Loans then outstanding, then "Supermajority Banks" shall mean such Bank
plus at least one other Bank that is not a Bank Affiliate of such Bank.
"Supplemental Indenture" means the Ninth Supplemental Indenture to be
executed and delivered by the Borrower and the Trustee, substantially in
the form of Exhibit 1.2.
18
"Swap Agreement" means any agreement with respect to any swap,
forward, future or derivative transaction or option or similar agreement
involving, or settled by reference to, one or more rates, currencies,
commodities, equity or debt instruments or securities, or economic,
financial or pricing indices or measures of economic, financial or pricing
risk or value or any similar transaction or any combination of these
transactions; provided that no phantom stock or similar plan providing for
payments only on account of services provided by current or former
directors, officers, employees or consultants of the Borrower or any of its
Subsidiaries shall be a "Swap Agreement".
"Taxes" has the meaning specified in Section 5.3(a).
"Tranche" means the collective reference to LIBOR Rate Loans, the
Interest Periods with respect to all of which begin on the same date and
end on the same later date (whether or not such Loans shall originally have
been made on the same day).
"Transferee" has the meaning specified in Section 11.6(f).
"Transfer Effective Date" has the meaning specified in Section
11.6(c).
"Triggering Event" has the meaning specified in Section 5.8(b).
"Trustee" means JPMorgan Chase Bank, as trustee under the Second
Mortgage Indenture.
"Type" refers to the determination of whether a Loan is an ABR Loan or
a LIBOR Rate Loan (or a borrowing comprised of such Loans).
"United States" means the United States of America.
"Wholly-Owned" means, with respect to any Subsidiary of any Person,
all the outstanding Capital Stock (other than directors' qualifying shares
required by law) or other ownership interest of such Subsidiary which are
at the time owned by such Person or by one or more Wholly-Owned
Subsidiaries of such Person, or both.
SECTION 1.2. Other Definitional Provisions. (a) Unless otherwise specified
therein, all terms defined in this Agreement shall have the defined meanings
when used in the other Loan Documents or any certificate or other document made
or delivered pursuant hereto or thereto.
(b) As used herein and in the other Loan Documents, and any certificate or
other document made or delivered pursuant hereto or thereto, (i) accounting
terms relating to the Borrower or any of its Subsidiaries not defined in Section
1.1 and accounting terms partly defined in Section 1.1, to the extent not
defined, shall have the respective meanings given to them under GAAP, (ii) the
words "include", "includes" and "including" shall be deemed to be followed by
the phrase "without limitation", (iii) the word "incur" shall be construed to
mean incur, create, issue, assume, become liable in respect of or suffer to
exist (and the words "incurred" and "incurrence" shall have correlative
meanings), (iv) the words "asset" and "property" shall be construed to have the
same meaning and effect and to refer to any and all tangible and intangible
assets and properties, including cash, Capital Stock, securities, revenues,
19
accounts, leasehold interests and contract rights, and (v) references to
agreements or other Contractual Obligations shall, unless otherwise specified,
be deemed to refer to such agreements or Contractual Obligations as amended,
supplemented, restated or otherwise modified from time to time.
(c) The words "hereof", "herein" and "hereunder" and words of similar
import, when used in this Agreement, shall refer to this Agreement as a whole
and not to any particular provision of this Agreement, and Section, Schedule and
Exhibit references are to this Agreement unless otherwise specified.
(d) The meanings given to terms defined herein shall be equally applicable
to both the singular and plural forms of such terms.
ARTICLE II
AMOUNTS AND TERMS OF THE LOANS
SECTION 2.1. Commitments. Subject to the terms and conditions hereof, each
Bank severally agrees to make a term loan (a "Loan") to the Borrower on the
Closing Date in an amount not to exceed the amount of the Commitment of such
Bank. The Loans may from time to time be LIBOR Rate Loans or ABR Loans, as
determined by the Borrower and notified to the Administrative Agent in
accordance with Sections 2.2 and 4.6.
SECTION 2.2. Procedure for Loan Borrowing. The Borrower shall give the
Administrative Agent irrevocable notice of borrowing (the "Notice of
Borrowing"), substantially in the form of Exhibit 2.2 hereto, on or prior to
1:00 P.M. (New York City time) on the day immediately prior to the proposed day
of borrowing, specifying the amount and Type of Loan comprising the borrowing to
be made on the Closing Date and with respect to any LIBOR Rate Loan, the
Interest Period for such Loan, and the Borrower shall have been deemed to have
made the representations and warranties contained in the Notice of Borrowing.
Upon receipt of the Notice of Borrowing the Administrative Agent shall promptly
notify each Bank thereof. Not later than 1:00 P.M. (New York City time), on the
Closing Date, each Bank shall make available to the Administrative Agent at the
Funding Office an amount in immediately available funds equal to the Loan to be
made by such Bank. The Administrative Agent shall credit the account of the
Borrower on the books of the Funding Office of the Administrative Agent with the
aggregate of the amounts made available to the Administrative Agent by the Banks
in immediately available funds.
SECTION 2.3. Repayment of Loans. The Borrower hereby unconditionally
promises to pay to each Bank, through the Administrative Agent, on the Maturity
Date, the then outstanding principal amount of the Loans of such Bank, together
with accrued and unpaid interest thereon as provided herein.
SECTION 2.4. Minimum and Maximum Tranches. All Borrowings, prepayments,
conversions and continuations of Loans hereunder and all selections of Interest
Periods hereunder shall be in such amounts and be made pursuant to such
elections so that, after giving effect thereto, (a) the aggregate principal
amount of the Loans comprising each Tranche of
20
LIBOR Rate Loans shall be equal to $10,000,000 or an integral multiple of
$1,000,000 in excess thereof and (b) not more than three separate Tranches of
LIBOR Rate Loans shall be outstanding at any time.
ARTICLE III
[INTENTIONALLY OMITTED]
ARTICLE IV
PROVISIONS RELATING TO ALL LOANS
SECTION 4.1. The Loans. (a) Each Bank shall maintain in accordance with its
usual practice an account or accounts evidencing indebtedness of the Borrower to
such Bank resulting from each Loan made by such Bank from time to time,
including, without limitation, the amounts of principal and interest payable and
paid to such Bank from time to time under this Agreement.
(b) The Administrative Agent shall maintain the Register pursuant to
Section 11.6(d) and a subaccount therein for each Bank, in which shall be
recorded (i) the amount of each Loan made by each Bank through the
Administrative Agent hereunder, the type thereof and each Interest Period
applicable thereto, (ii) the amount of any principal or interest due and payable
or to become due and payable from the Borrower to each Bank hereunder and (iii)
both the amount of any sum received by the Administrative Agent hereunder from
the Borrower and each Bank's share thereof.
(c) The entries made in the Register and the accounts of each Bank
maintained pursuant to Section 4.1(a) shall, to the extent permitted by
applicable law, be prima facie evidence of the existence and amount of the
obligations of the Borrower therein recorded; provided, however, that the
failure of any Bank or the Administrative Agent to maintain the Register or any
such account, or any error therein, shall not in any manner affect the
obligation of the Borrower to repay (with applicable interest) the Loans
actually made to the Borrower by such Bank in accordance with the terms of this
Agreement.
SECTION 4.2. Fees. The Borrower shall pay to the Administrative Agent, for
its own account, the fees in the amounts and on the dates previously agreed to
in writing by the Borrower and the Administrative Agent.
SECTION 4.3. Interest. The Borrower shall pay interest on the unpaid
principal amount of each Loan made by each Bank from the date of such Loan until
such principal amount shall be paid in full, at the times and at the rates per
annum set forth below:
(a) ABR Loans. Each ABR Loan shall bear interest at a rate per annum equal
at all times to the lesser of (i) the ABR plus 8.75% and (ii) the Highest Lawful
Rate, payable quarterly in arrears on the last Business Day of each March, June,
September and December, commencing on the last Business Day of December 2002,
and on the Maturity Date.
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(b) LIBOR Rate Loans. Each LIBOR Rate Loan shall bear interest at a rate
per annum equal at all times to the lesser of (A) the sum of the LIBOR Rate for
the applicable Interest Period for such Loan plus 9.75% and (B) the Highest
Lawful Rate, payable on the last day of such Interest Period and, with respect
to Interest Periods of six, nine or twelve months, each day during such Interest
Period that occurs at intervals of three months' duration after the first day of
such Interest Period, and on the Maturity Date.
(c) Calculations. Interest that is determined by reference to the Alternate
Base Rate shall be calculated by the Administrative Agent on the basis of a 365-
or 366-day year, as the case may be, for the actual days (including the first
day but excluding the last day) occurring in the period in which such interest
is payable and otherwise shall be calculated by the Administrative Agent on the
basis of a 360-day year for the actual days (including the first day and
excluding the last day) occurring in the period for which such interest is
payable.
(d) Default Rate. Notwithstanding the foregoing, if all or a portion of (i)
the principal amount of any Loan, (ii) any interest payable thereon, or (iii)
any other amount payable hereunder shall not be paid when due (whether at the
stated maturity, by acceleration or otherwise), such overdue amount shall bear
interest, payable from time to time on demand, at a rate per annum equal to the
lesser of (A) the Highest Lawful Rate and (B) the Default Rate, in each case
from the date of such non-payment until such amount is paid in full (after as
well as before judgment).
(e) Determination Conclusive. Each determination of an interest rate by the
Administrative Agent pursuant to any provisions of this Agreement shall be
conclusive and binding on the Borrower and the Banks in the absence of manifest
error. The Administrative Agent shall, at the request of the Borrower, deliver
to the Borrower a statement showing in reasonable detail the basis upon which
the LIBOR Rate was determined.
SECTION 4.4. Reserve Requirements. (a) The Borrower agrees to pay to each
Bank that requests compensation under this Section 4.4 in accordance with the
provisions set forth in Section 5.7(b), so long as such Bank shall be required
to maintain reserves against "Eurocurrency liabilities" under Regulation D of
the Board (or, so long as such Bank shall be required by the Board or by any
other Governmental Authority to maintain reserves against any other category of
liabilities that includes deposits by reference to which the interest rate on
LIBOR Rate Loans is determined as provided in this Agreement or against any
category of extensions of credit or other assets of such Bank that includes any
LIBOR Rate Loans), an additional amount (determined by such Bank and notified to
the Borrower pursuant to the provisions set forth in Section 5.7(b))
representing such Bank's calculation or, if an accurate calculation is
impracticable, reasonable estimate (using such method of allocation to such
Loans of the Borrower as such Bank shall determine in accordance with Section
5.7(a)) of the actual costs, if any, incurred by such Bank during the relevant
Interest Period, as a result of the applicability of the foregoing reserves to
such LIBOR Rate Loans, which amount in any event shall not exceed the product of
the following for each day of such Interest Period:
(i) the principal amount of the relevant LIBOR Rate Loans made by such
Bank outstanding on such day; and
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(ii) the difference between (A) a fraction, the numerator of which is
the LIBOR Rate (expressed as a decimal) applicable to such LIBOR Rate Loan
(expressed as a decimal), and the denominator of which is one minus the
maximum rate (expressed as a decimal) at which such reserve requirements
are imposed by the Board or other Governmental Authority on such date,
minus (B) such numerator; and
(iii) a fraction, the numerator of which is one and the denominator of
which is 360.
(b) The agreements in this Section 4.4 shall survive the termination of
this Agreement and the payment all amounts payable hereunder; provided, however,
that in no event shall the Borrower be obligated to reimburse or compensate any
Bank for amounts contemplated by this Section 4.4 for any period prior to the
date that is 90 days before the date upon which such Bank requests in writing
such reimbursement or compensation from the Borrower.
SECTION 4.5. Interest Rate Determination and Protection. (a) The rate of
interest for each LIBOR Rate Loan shall be determined by the Administrative
Agent two (2) Business Days before the first day of each Interest Period
applicable to such Loan. The Administrative Agent shall give prompt notice to
the Borrower and the Banks of the applicable interest rate determined by the
Administrative Agent for purposes of Sections 4.3(a) and (b).
(b) If, with respect to any LIBOR Rate Loans, prior to the first day of an
Interest Period (i) the Administrative Agent shall have determined (which
determination shall be conclusive and binding upon the Borrower) that, by reason
of circumstances affecting the London interbank market, adequate and reasonable
means do not exist for ascertaining the LIBOR Rate for such Interest Period or
(ii) the Administrative Agent shall have received notice from the Majority Banks
that the LIBOR Rate determined or to be determined for such Interest Period will
not adequately and fairly reflect the cost to such Banks (as determined in good
faith and certified by such Banks) of making or maintaining their affected LIBOR
Rate Loans during such Interest Period, the Administrative Agent shall give
facsimile or telephonic notice thereof (with written notice to follow promptly)
to the Borrower and the Banks as soon as practicable thereafter. If such notice
is given, (A) any LIBOR Rate Loans requested to be made on the first day of such
Interest Period shall be made as ABR Loans, (B) any Loans that were to have been
converted on the first day of such Interest Period to LIBOR Rate Loans shall be
continued as ABR Loans and (C) any outstanding LIBOR Rate Loans shall be
converted, on the first day of such Interest Period, to ABR Loans. Until such
notice has been withdrawn by the Administrative Agent, no further LIBOR Rate
Loans shall be made or continued as such, nor shall the Borrower have the right
to convert Loans to LIBOR Rate Loans.
SECTION 4.6. Voluntary Interest Conversion or Continuation of Loans. (a)
The Borrower may on any Business Day, upon the Borrower's irrevocable oral or
written notice of interest conversion/continuation given by the Borrower to the
Administrative Agent not later than 11:00 A.M. (New York City time) on the third
Business Day prior to the date of the proposed interest conversion or
continuation in the case of a LIBOR Rate Loan, (i) convert Loans of one Type
into Loans of another Type; (ii) convert LIBOR Rate Loans for a specified
Interest Period into LIBOR Rate Loans for a different Interest Period; or (iii)
continue LIBOR Rate Loans for a specified Interest Period as LIBOR Rate Loans
for the same Interest Period;
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provided, however, that (A) any conversion of any LIBOR Rate Loans into LIBOR
Rate Loans for a different Interest Period, or into ABR Loans, or any
continuation of LIBOR Rate Loans for the same Interest Period shall be made on,
and only on, the last day of an Interest Period for such LIBOR Rate Loans; (B)
no Loan may be converted into or continued as a LIBOR Rate Loan by the Borrower
so long as an Event of Default has occurred and is continuing; (C) no Loan may
be converted into or continued as a LIBOR Rate Loan after the date that is one
month prior to the Maturity Date, and (D) no Loan may be converted into or
continued as a LIBOR Rate Loan if, after giving effect thereto, Section 2.4
would be contravened. With respect to any oral notice of interest
conversion/continuation given by the Borrower under this Section 4.6(a), the
Borrower shall promptly thereafter confirm such notice in writing. Each written
notice of interest conversion/continuation given by the Borrower under this
Section 4.6(a) and each confirmation of an oral notice of interest
conversion/continuation given by the Borrower under this Section 4.6(a) shall be
in substantially the form of Exhibit 4.6 hereto ("Notice of Interest
Conversion/Continuation"). Each such Notice of Interest Conversion/Continuation
shall specify therein the requested (x) date of such interest conversion or
continuation; (y) the Loans to be converted or continued; and (z) if such
interest conversion or continuation is into LIBOR Rate Loans, the duration of
the Interest Period for each such LIBOR Rate Loan. Upon receipt of any such
Notice of Interest Conversion/Continuation, the Administrative Agent shall
promptly notify each Bank thereof. Each Notice of Interest
Conversion/Continuation shall be irrevocable and binding on the Borrower.
(b) If the Borrower shall fail to deliver to the Administrative Agent a
Notice of Interest Conversion/Continuation in accordance with Section 4.6(a)
hereof, or to select the duration of any Interest Period for the principal
amount outstanding under any LIBOR Rate Loan by 11:00 A.M. (New York City time)
on the third Business Day prior to the last day of the Interest Period
applicable to such Loan in accordance with Section 4.6(a), the Administrative
Agent will forthwith so notify the Borrower and the Banks (provided that the
failure to give such notice shall not affect the conversion referred to below)
and such Loans will automatically, on the last day of the then existing Interest
Period therefor, convert into LIBOR Rate Loans with a one month Interest Period.
SECTION 4.7. Funding Losses Relating to LIBOR Rate Loans. (a) The Borrower
agrees, without duplication of any other provision under this Agreement, to
indemnify each Bank and to hold each Bank harmless from any loss or expense that
such Bank may sustain or incur as a consequence of (i) default by the Borrower
in payment when due of the principal amount of or interest on any LIBOR Rate
Loan, (ii) default by the Borrower in making a borrowing of, conversion into or
continuation of any LIBOR Rate Loan after the Borrower has given a notice
requesting the same in accordance with the provisions of this Agreement, (iii)
default by the Borrower in making any prepayment after the Borrower has given a
notice thereof in accordance with the provisions of this Agreement or (iv) the
making of a prepayment of LIBOR Rate Loans or the conversion of LIBOR Rate Loans
into ABR Loans, on a day that is not the last day of an Interest Period with
respect thereto (excluding any prepayment made pursuant to Section 4.8),
including, without limitation, in each case, any such loss or expense arising
from the reemployment of funds obtained by it or from fees payable to terminate
the deposits from which such funds were obtained. The calculation of all amounts
payable to a Bank under this Section 4.7(a) shall be made pursuant to the method
described in Section 5.7(a), but in no event shall such amounts payable with
respect to any LIBOR Rate Loan exceed the amounts that would
24
have been payable assuming such Bank had actually funded its relevant LIBOR Rate
Loan through the purchase of a deposit bearing interest at the LIBOR Rate in an
amount equal to the amount of such LIBOR Rate Loan and having a maturity
comparable to, with respect to any LIBOR Rate Loan, the relevant Interest
Period; provided that each Bank may fund each of its LIBOR Rate Loans in any
manner it sees fit, and the foregoing assumption shall be utilized only for the
calculation of amounts payable under this Section 4.7(a).
(b) The agreements in this Section 4.7 shall survive the termination of
this Agreement and the payment of all amounts payable hereunder; provided,
however, that in no event shall the Borrower be obligated to reimburse or
compensate any Bank for amounts contemplated by this Section 4.7 for amounts
accruing prior to the date that is 90 days prior to the date upon which such
Bank requests in writing such reimbursement or compensation from the Borrower.
SECTION 4.8. Change in Legality. (a) Notwithstanding any other provision of
this Agreement, if any Bank shall notify the Administrative Agent that it has
determined in good faith that the introduction of or any change in or in the
interpretation or application of any law or regulation by any Governmental
Authority (in each case occurring after the date of this Agreement) makes it
unlawful, or any central bank or other Governmental Authority asserts after the
date of this Agreement that it is unlawful, for any Bank or its applicable
lending office to perform its obligations hereunder to make LIBOR Rate Loans or
to fund or maintain LIBOR Rate Loans hereunder, (i) the obligation of such Bank
to make, or to convert Loans into, or to continue LIBOR Rate Loans as, LIBOR
Rate Loans shall be suspended until the Administrative Agent shall notify the
Borrower that the circumstances causing such suspension no longer exist and (ii)
the Borrower shall, at its option, either prepay in full all LIBOR Rate Loans of
such Bank then outstanding, or convert all such Loans to ABR Loans, on the
respective last days of the then current Interest Periods with respect to such
Loans (or within such earlier period as required by law), accompanied, in the
case of any prepayments, by interest accrued thereon and any amounts payable
under Section 4.7(a). Each Bank agrees that it will use reasonable efforts to
designate a different lending office for the LIBOR Rate Loans due to it affected
by this Section 4.8, if such designation will avoid the illegality described in
this Section 4.8 so long as such designation will not be disadvantageous to such
Bank as determined by such Bank in its sole discretion acting in good faith.
(b) For purposes of this Section 4.8, a notice to the Borrower (with a copy
to the Administrative Agent) by any Bank pursuant to paragraph (a) above shall
be effective on the date of receipt thereof by the Borrower.
ARTICLE V
INCREASED COSTS, TAXES, PAYMENTS AND PREPAYMENTS
SECTION 5.1. Increased Costs; Capital Adequacy. (a) If after the date of
this Agreement the adoption of or any change in any law or regulation or in the
interpretation or application thereof by any Governmental Authority or
application thereof or compliance by any Bank with any request or directive
(whether or not having the force of law) from any central bank or other
Governmental Authority made subsequent to the date of this Agreement:
25
(i) shall subject any Bank to any tax of any kind whatsoever with
respect to this Agreement, any Note, any other Loan Document, or any LIBOR
Rate Loan made by it, or change the basis of taxation of payments to such
Bank in respect thereof (except for (A) Taxes covered by Section 5.3, (B)
net income taxes and franchise taxes imposed on such Bank as a result of a
present or former connection between the jurisdiction of the government or
taxing authority imposing such tax and such Bank other than a connection
arising solely from such Bank having executed, delivered or performed its
obligations or received a payment under, or enforced, this Agreement or the
Loans and (C) changes in the rate of tax on the overall net income of such
Bank);
(ii) shall impose, modify or hold applicable any reserve, special
deposit, compulsory loan or similar requirement against assets held by,
deposits or other liabilities in or for the account of, advances, loans or
other extensions of credit by, or any other acquisition of funds by, any
office of such Bank that is not otherwise included in the determination of
the LIBOR Rate hereunder (except for amounts covered by Section 4.4 or any
other Section hereof); or
(iii) shall impose on such Bank any other condition;
and the result of any of the foregoing is to increase the actual cost to such
Bank, by an amount that such Bank deems to be material, of making, converting
into, continuing or maintaining LIBOR Rate Loans or to reduce any amount
receivable hereunder in respect thereof, then, in any such case, the Borrower
shall promptly pay such Bank, upon its demand in the manner set forth in Section
5.7(b), any additional amounts, computed by such Bank in accordance with Section
5.7(a), necessary to compensate such Bank for such actual increased cost or
reduced amount receivable that is attributable to Loans or Commitments (to the
extent that such Bank has not already been compensated or reimbursed for such
amounts pursuant to any other provision of this Agreement). If any Bank becomes
entitled to claim any additional amounts pursuant to this Section 5.1(a) from
the Borrower, it shall promptly notify the Borrower, through the Administrative
Agent, of the event by reason of which it has become so entitled in the manner
set forth in Section 5.7(b).
(b) If any Bank determines in good faith that the introduction of or any
change in or in the interpretation or application by any Governmental Authority
of any law or regulation regarding capital adequacy after the date of this
Agreement or compliance by such Bank or any corporation controlling such Bank
with any law or regulation or any guideline or request from any central bank or
other Governmental Authority (whether or not having the force of law) made or
issued after the date of this Agreement does or shall have the effect, as a
result of such Bank's obligations under this Agreement, of reducing the rate of
return on such Bank's or such corporation's capital to a level below that which
such Bank or such corporation could have achieved but for such change or
compliance (taking into consideration such Bank's or such corporation's policies
with respect to capital adequacy) by an amount deemed by such Bank to be
material, the Borrower shall pay to the Administrative Agent for the account of
such Bank, from time to time as specified by such Bank in the manner set forth
in Section 5.7(b), additional amounts, computed by such Bank in accordance with
Section 5.7(a), sufficient to compensate such Bank or such corporation in the
light of such circumstances, to the extent that such Bank
26
reasonably determines such reduction in rate of return is allocable to the
existence of such Bank's obligations hereunder.
(c) The agreements contained in this Section 5.1 shall survive the
termination of this Agreement and the payment of all amounts payable hereunder;
provided, however, that in no event shall the Borrower be obligated to reimburse
or compensate any Bank for amounts contemplated by this Section 5.1 for any
period prior to the date that is 90 days prior to the date upon which such Bank
requests in writing such reimbursement or compensation from the Borrower.
SECTION 5.2. Pro Rata Treatment and Payments. (a) Each borrowing by the
Borrower from the Banks hereunder shall be made pro rata according to the Pro
Rata Percentages of the Banks. Except to the extent expressly provided in
Section 5.5 or 5.6, each payment by the Borrower on account of principal of and
interest on the Loans shall be made pro rata according to the respective Pro
Rata Percentages of the Banks. Amounts prepaid on account of the Loans may not
be reborrowed.
(b) The Borrower shall make each payment (including each mandatory
prepayment) hereunder, whether on account of principal, interest, fees or
otherwise, without setoff or counterclaim, not later than 12:00 Noon (New York
City time) on the day when due, in Dollars to the Administrative Agent at the
Funding Office in immediately available funds. The Administrative Agent will
promptly thereafter cause to be distributed like funds relating to the payment
of principal or interest (to the extent received by the Administrative Agent)
ratably to the Banks according to the amounts of their respective Loans in
respect of which such payment is made and like funds relating to the payment of
any other amount payable to any Bank (to the extent received by the
Administrative Agent) to such Bank, in each case to be applied in accordance
with the terms of this Agreement.
(c) Whenever any payment hereunder or under the Notes shall be stated to be
due on a day other than a Business Day, such payment shall be made on the next
succeeding Business Day, and such extension of time shall in such case be
included in the computation of payment of interest or fees, as the case may be;
provided, however, if such extension would cause payment of interest on or
principal of LIBOR Rate Loans to be made in the next following calendar month,
such payment shall be made on the next preceding Business Day.
(d) Unless the Administrative Agent shall have received notice from the
Borrower prior to the date on which any payment is due to the Banks hereunder
that the Borrower will not make such payment in full, the Administrative Agent
may assume that the Borrower has made such payment in full to the Administrative
Agent on such date and the Administrative Agent may, in reliance upon such
assumption, cause to be distributed to each Bank on such due date an amount
equal to the amount then due such Bank. If and to the extent the Borrower shall
not have so made such payment in full to the Administrative Agent, each Bank
shall pay to the Administrative Agent on demand an amount equal to the product
of (i) the daily average Federal Funds Effective Rate during such period, times
(ii) the Pro Rata Percentage of such payment, times (iii) a fraction, the
numerator of which is the number of days that elapse from and including the date
such amount is distributed to such Bank to the date on
27
which such Bank's Pro Rata Percentage of such payment shall have become
immediately available to the Administrative Agent and the denominator of which
is 360.
SECTION 5.3. Taxes. (a) Any and all payments by the Borrower hereunder or
under the Loan Documents shall be made, in accordance with Section 5.2, free and
clear of and without deduction or withholding for or on account of any and all
present or future taxes, levies, imposts, deductions, charges or withholdings,
and all liabilities with respect thereto, excluding, in the case of each Bank
and the Administrative Agent, net income taxes and franchise taxes imposed on it
as a result of a present or former connection between the jurisdiction of the
government or taxing authority imposing such tax and the Administrative Agent or
such Bank other than a connection arising solely from the Administrative Agent
or such Bank having executed, delivered or performed its obligations or received
a payment under, or enforced, this Agreement or any Note (all such non-excluded
taxes, levies, imposts, deductions, charges, withholdings and liabilities being
hereinafter referred to as "Taxes"). If the Borrower shall be required by law to
deduct any Taxes from or in respect of any sum payable hereunder or under any
Note to any Bank or the Administrative Agent, (i) the sum payable shall be
increased as may be necessary so that after making all required deductions
(including deductions applicable to additional sums payable under this Section
5.3) such Bank or the Administrative Agent (as the case may be) receives an
amount equal to the sum it would have received had no such deductions been made;
(ii) the Borrower shall make such deductions and (iii) the Borrower shall pay
the full amount deducted to the relevant taxation authority or other authority
in accordance with applicable law; provided, however, that the Borrower shall
not be required to increase any such sums payable to any Bank with respect to
any Taxes (i) that are attributable to such Bank's failure to comply with the
requirements of Section 5.3(d) or (ii) that are United States withholding taxes
imposed on sums payable to such Bank at the time such Bank becomes a party to
this Agreement except to the extent that any such Bank's assignor (if any) was
entitled, at the time of assignment, to receive additional amounts from the
Borrower with respect to such Taxes pursuant to this Section 5.3. Whenever any
Taxes or Other Taxes (as defined in Section 5.3(b)) are payable by the Borrower,
as promptly as possible thereafter the Borrower shall send to the Administrative
Agent for the account of the relevant Bank or Administrative Agent, as the case
may be, either (A) official tax receipts or notarized copies of such receipts to
such Bank within thirty (30) days after payment of any applicable tax or (B) a
certificate executed by a Responsible Officer of the Borrower confirming that
such Taxes or Other Taxes have been paid, together with evidence of such
payment.
(b) In addition, the Borrower agrees to pay any present or future stamp or
documentary taxes or any other excise or property taxes, charges or similar
levies that arise from any payment made hereunder or under any Note or from the
execution, delivery or registration of, or otherwise with respect to, this
Agreement, any other Loan Document, or the Loans and for which such Bank or the
Administrative Agent (as the case may be) has not been otherwise reimbursed by
the Borrower under this Agreement (hereinafter referred to as "Other Taxes").
(c) The Borrower will indemnify each Bank and the Administrative Agent for
the full amount of Taxes or Other Taxes (including, without limitation, any
Taxes or Other Taxes imposed by any jurisdiction on amounts payable under this
Section 5.3) paid by such Bank or the Administrative Agent (as the case may be)
and any liability (including penalties, interest and expenses) arising therefrom
or with respect thereto, including, without limitation or duplication,
28
any incremental taxes, interest or penalties that may become payable by the
Administrative Agent or any Bank as a result of any failure by the Borrower to
pay any Taxes or Other Taxes when due to the appropriate taxing authority or to
remit to any Bank the receipts or other evidence of payment of Taxes or Other
Taxes.
(d) Each Bank registered in the Register that is not a U.S. Person as
defined in Section 7701(a)(30) of the Code agrees that it will deliver to the
Borrower and the Administrative Agent on the Closing Date, or on the date which
it becomes a party to this Agreement, two duly completed copies of United States
Internal Revenue Service Form W-8BEN or W-8ECI (or other appropriate
corresponding form) or any successor applicable form, as the case may be. Each
such Bank also agrees to deliver to the Borrower and the Administrative Agent
two further copies of the said Form W-8BEN or W-8ECI, or successor applicable
forms or other manner of certification, as the case may be, on or before the
date that any such form expires or becomes obsolete or after the occurrence of
any event requiring a change in the most recent form previously delivered by it
to the Borrower, and such extensions or renewals thereof as may reasonably be
requested by the Borrower or the Administrative Agent, unless in any such case
an event (including, without limitation, any change in treaty, law or
regulation) has occurred prior to the date on which any such delivery would
otherwise be required that renders all such forms inapplicable or that would
prevent such Bank from duly completing and delivering any such form with respect
to it and such Bank so advises the Borrower and the Administrative Agent. Each
such Bank shall certify in the case of a Form W-8BEN or W-8ECI that it is
entitled to receive payments under this Agreement without deduction or
withholding of any United States federal income taxes. In the event that any
such Bank fails to deliver any forms required under this Section 5.3(d), the
Borrower's obligation to pay additional amounts shall be reduced to the amount
that it would have been obligated to pay had such forms been provided.
(e) If any Taxes or Other Taxes are not correctly or legally asserted and
the Administrative Agent or any Bank determines, in its sole discretion, that it
has received a refund of those Taxes or Other Taxes as to which it has been
indemnified by the Borrower, the Administrative Agent or such Bank shall within
20 days after such refund pay to the Borrower the amount of such refund to the
extent that the Borrower indemnified the Administrative Agent or such Bank for
such Taxes or Other Taxes pursuant to this Section 5.3, net of any out-of-pocket
costs of the Administrative Agent or such Bank and without interest (other than
any interest paid by the relevant Governmental Authority with respect to such
refund); provided, that the Borrower, upon the request of the Administrative
Agent or such Bank, agrees to repay the amount paid over to the Borrower (plus
any penalties, interest or other charges imposed by the relevant Governmental
Authority) to the Administrative Agent or such Bank in the event the
Administrative Agent or such Bank is required to repay such refund to such
Governmental Authority. This paragraph shall not be construed to require the
Administrative Agent or any Bank to make available its tax returns (or any other
information relating to its taxes which it deems confidential) to the Borrower
or any other Person.
(f) The agreements in this Section 5.3 shall survive the termination of
this Agreement and the payment of all amounts payable hereunder; provided,
however, that (i) in no event shall the Borrower be obligated to reimburse or
compensate any Bank for amounts contemplated by this Section 5.3 for any period
before the date that is 180 days before the date
29
upon which such Bank requests in writing such reimbursement or compensation from
the Borrower (other than any amounts as to which the ultimate amount of the
reimbursement due could not then be determined) and (ii) nothing contained in
this Section 5.3 shall require the Borrower to pay any amount to any Bank or the
Administrative Agent in addition to that for which it has already reimbursed any
Bank or the Administrative Agent under any other provision of this Agreement.
SECTION 5.4. Sharing of Payments, Etc. If any Bank (a "benefitted Bank")
shall at any time receive any payment (other than pursuant to Section 4.4, 4.7,
5.1 or 5.3 or as expressly contemplated by Section 5.5 or 5.6) of all or part of
its Loans, or interest thereon, or receive any collateral in respect thereof
(whether voluntarily or involuntarily, by setoff, pursuant to events or
proceedings of the nature referred to in Section 9.1(g) or 9.1(h), or
otherwise), in a greater proportion than any such payment to or collateral
received by any other Bank, if any, in respect of such other Bank's Loans, or
interest thereon, such benefitted Bank shall purchase for cash from the other
Banks a participating interest in such portion of each such other Bank's Loans
or shall provide such other Banks with the benefits of any such collateral, or
the proceeds thereof, as shall be necessary to cause such benefitted Bank to
share the excess payment or benefits of such collateral or proceeds ratably with
each of the Banks; provided, however, that if all or any portion of such excess
payment or benefits is thereafter recovered from such benefitted Bank, such
purchase shall be rescinded, and the purchase price and benefits returned, to
the extent of such recovery, but without interest. The Borrower agrees that any
Bank so purchasing a participation from another Bank pursuant to this Section
5.4 may, to the fullest extent permitted by law, exercise all its rights of
payment (including the right of setoff) with respect to such participation as
fully as if such Bank were the direct creditor of the Borrower in the amount of
such participation.
SECTION 5.5. Voluntary Prepayments. The Borrower may, upon written notice
delivered to the Administrative Agent at least 10 days prior to the proposed
date of prepayment stating the aggregate principal amount of the Loans to be
prepaid and the proposed prepayment price thereof, offer to prepay the
outstanding principal amounts of the Loans comprising part of the same borrowing
in whole or ratably in part, together with accrued interest to the date of such
prepayment on the principal amount prepaid; provided, however, that no Bank
shall be obligated to accept such offer. To the extent one or more Banks accepts
any such offer ("Accepting Banks") and one or more Banks rejects such offer
("Rejecting Banks"), the amounts that would have been allocable to the Rejecting
Banks may (if accepted by the Accepting Banks) be paid to the Accepting Banks in
accordance with their Pro Rata Percentages. Any Bank that shall have failed to
respond to an offer described in this Section 5.5 shall be deemed to have
rejected such offer. If any Bank shall have rejected (or been deemed to have
rejected) any offer to prepay described above and the Borrower shall thereafter
vary the offer, the Borrower shall make the modified offer available to the
Rejecting Banks for a period of at least three Business Days before making the
contemplated prepayment. Except as provided in this Section 5.5, the Borrower
shall not have the right to prepay the Loans.
SECTION 5.6. Mandatory Repayments and Prepayments and Commitment
Reductions. (a) Subject to paragraph (d) below, if any Capital Stock or
Indebtedness shall be issued or incurred by the Borrower or any of its
Subsidiaries after the Closing Date (other than Excluded Transactions), an
amount equal to 100% of the Net Cash Proceeds thereof shall be applied within
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two (2) Business Days after such issuance or incurrence toward the prepayment of
the Loans as set forth in Section 5.6(c); provided that, notwithstanding the
foregoing, the Net Cash Proceeds from all such issuances and incurrences made in
accordance with the terms of this Agreement, other than Excluded Transactions
and any issuance or incurrence by a Securitization Subsidiary, shall be used to
prepay the loans outstanding under the CenterPoint Credit Facility to the extent
subject to the mandatory prepayment requirements of the CenterPoint Credit
Agreement. Solely for purposes of this Section 5.6, Securitization Subsidiaries
shall be deemed to be "Subsidiaries" of the Borrower, and the sale or
contribution of assets to a Securitization Subsidiary, together with the
issuance of Securitization Securities, shall be deemed to be an incurrence of
Indebtedness (and not an Excluded Asset Sale or otherwise subject to Section
5.6(b)).
(b) Subject to paragraph (d) below, if the Borrower or any of its
Subsidiaries shall receive Net Cash Proceeds from any Asset Sale (other than (x)
an Excluded Asset Sale and (y) any Asset Sale yielding Net Cash Proceeds of
$30,000,000 or less, provided that the aggregate amount of Net Cash Proceeds
from all Asset Sales excluded by this clause (y) shall not exceed $100,000,000)
or Recovery Event then, unless a Reinvestment Notice shall be delivered in
respect thereof, within two (2) Business Days after such Asset Sale or Recovery
Event, the Borrower shall, or shall cause the applicable Subsidiary to, apply
such Net Cash Proceeds toward the prepayment of the Loans as set forth in
Section 5.6(c); provided that, notwithstanding the foregoing, (i) the aggregate
Net Cash Proceeds of Asset Sales that may be excluded from the foregoing
pursuant to a Reinvestment Notice shall not exceed $120,000,000, (ii) on each
Reinvestment Prepayment Date, an amount equal to the Reinvestment Prepayment
Amount with respect to the relevant Reinvestment Event shall be applied toward
the prepayment of the Loans as set forth in Section 5.6(c) and (iii) such Net
Cash Proceeds shall be used to prepay the loans outstanding under the
CenterPoint Credit Facility to the extent subject to the mandatory prepayment
requirements of the CenterPoint Credit Agreement.
(c) The Borrower shall deliver to the Administrative Agent, at the time of
each prepayment required under this Section 5.6, (i) a certificate signed by a
Responsible Officer of the Borrower setting forth in reasonable detail the
calculation of the amount of such prepayment and (ii) to the extent practicable,
at least three days prior written notice of such prepayment. Each notice of
prepayment shall specify the prepayment date, the Type of each Loan being
prepaid and the principal amount of each Loan (or portion thereof) to be
prepaid. All prepayments of borrowings under this Section 5.6 shall be subject
to Section 4.7, but shall otherwise be without premium or penalty.
(d) Each Bank may, by notice to the Administrative Agent in writing no
later than 3:00 p.m., New York City time, at least one Business Day prior to any
prepayment required to be made by the Borrower for the account of such Bank
pursuant to this Section 5.6, elect either to accept or to refuse all or a
portion of such prepayment (and any Bank that shall have failed so to notify the
Administrative Agent shall be deemed to have refused such prepayment). Any
amounts so refused by the Banks may be retained by the Borrower.
SECTION 5.7. Mitigation of Losses and Costs. Any Bank claiming
reimbursement from the Borrower under any of Sections 4.4, 4.7, 5.1 and 5.3
hereof shall use reasonable efforts (including, without limitation, if requested
by the Borrower, reasonable efforts to designate a different lending office of
such Bank) to mitigate the amount of such losses, costs, expenses and
31
liabilities, if such efforts can be made and such mitigation can be accomplished
without such Bank suffering (a) any economic disadvantage for which such Bank
does not receive full indemnity from the Borrower under this Agreement or (b)
any legal or regulatory disadvantage.
SECTION 5.8. Determination and Notice of Additional Costs and Other
Amounts. (a) In determining the amount of any claim for reimbursement or
compensation under Sections 4.4, 4.7 and 5.1, each Bank may use any reasonable
averaging, attribution and allocation methods consistent with such methods
customarily employed by such Bank in similar situations.
(b) Each Bank or, with respect to compensation claimed by it pursuant to
Section 5.3, the Administrative Agent, as the case may be, will (i) use its best
efforts to notify the Borrower through the Administrative Agent (in the case of
each Bank) of any event occurring after the date of this Agreement promptly
after the occurrence thereof and (ii) notify the Borrower through the
Administrative Agent (in the case of each Bank) promptly after such Bank or the
Administrative Agent, as the case may be, becomes aware of any event occurring
after the date of this Agreement, in either case if such event (for purposes of
this Section 5.8(b), a "Triggering Event") will entitle such Bank or the
Administrative Agent, as the case may be, to compensation pursuant to Section
4.4, 4.7, 5.1 or 5.3, as the case may be. Each such notification of a Triggering
Event shall be accompanied by a certificate of such Bank or the Administrative
Agent, as the case may be, setting forth the calculations and justification in
reasonable detail such amount or amounts as shall be necessary to compensate
such Bank or the Administrative Agent, as the case may be, as specified in
Section 4.4, 4.7, 5.1 or 5.3, as the case may be, and certifying that such costs
are generally being charged by such Bank to other similarly situated borrowers
under similar credit facilities, which certificate shall be conclusive absent
manifest error. The Borrower shall pay to the Administrative Agent for the
account of such Bank or to the Administrative Agent for its own account, as the
case may be, the amount shown as due on any such certificate within ten (10)
Business Days after its receipt of the same.
ARTICLE VI
CONDITIONS OF LENDING
SECTION 6.1. Conditions Precedent to Effectiveness and Loans. The agreement
of each Bank to make the extension of credit requested to be made by it is
subject to the satisfaction, prior to or concurrently with the making of such
extension of credit on the Closing Date, of the following conditions precedent:
(a) The Administrative Agent (or its counsel) shall have received (i) this
Agreement executed and delivered by the Borrower and each Bank and (ii) the
Pledge Agreement executed and delivered by the Borrower.
(b) The Administrative Agent (or its counsel) shall have received a
certificate dated as of the Closing Date of the Secretary or an Assistant
Secretary of the Borrower certifying (i) the names and true signatures of the
Responsible Officers of the Borrower authorized to sign each Loan Document to
which the Borrower is a party and the notices and other documents to be
delivered by the Borrower pursuant to any such Loan Document; (ii) the bylaws
and articles of incorporation of the Borrower as in effect on the date of such
certification; (iii) the resolutions of
32
the Board of Directors of the Borrower approving and authorizing the execution,
delivery and performance by the Borrower of each Loan Document to which it is a
party and any Notes from time to time issued hereunder and authorizing the
borrowings and other transactions contemplated hereunder and (iv) that all
authorizations, approvals and consents by any Governmental Authority or other
Person necessary in connection with the execution, delivery and performance of
the Loan Documents and any other regulatory approvals in respect thereof
required to be obtained prior to the Closing Date, have been obtained and are in
full force and effect.
(c) The Administrative Agent (or its counsel) shall have received a
certificate dated as of the Closing Date of a Responsible Officer of the
Borrower certifying that, as of the Closing Date and except as disclosed on
Schedule 6.1(c), the Borrower owns, directly or indirectly through one or more
of its Subsidiaries, all of the outstanding Capital Stock of each of its
Significant Subsidiaries, free and clear of any Liens.
(d) The Administrative Agent shall have received an executed legal opinion,
dated the Closing Date, of (i) Xxxxx Xxxxx LLP, counsel to the Borrower, (ii)
the Deputy General Counsel of the Borrower and (iii) such other special and
local counsel as may be required by the Administrative Agent. Each such legal
opinion shall cover such matters incident to the transactions contemplated by
this Agreement as the Administrative Agent may reasonably require and shall
otherwise be in form and substance reasonably satisfactory to the Administrative
Agent.
(e) The Administrative Agent (or its counsel) shall have received
certificates dated on or about the Closing Date of the Secretary of State of the
State of Texas as to the existence and good standing of the Borrower.
(f) (i) The Administrative Agent shall have received the Pledged Bonds in
an aggregate principal amount equal to the amount of the Loans made on the
Closing Date, registered in the name of the Administrative Agent and duly
executed by the Borrower and authenticated by the Trustee; and
(ii) Each document (including any Uniform Commercial Code financing
statement) required by the Pledge Agreement or under law or reasonably
requested by the Administrative Agent to be delivered, filed, registered or
recorded in order to create in favor of the Administrative Agent, for the
benefit of the Banks, a perfected Lien on the Collateral described therein,
prior and superior in right to any other Person (other than with respect to
Liens expressly permitted by Section 8.2), and the Supplemental Indenture,
shall be in proper form for filing, registration or recordation.
(g) The Administrative Agent shall have received satisfactory evidence that
the Existing Credit Facilities shall have been terminated and all amounts
thereunder shall have been paid in full.
(h) All governmental and third-party approvals necessary in connection with
the execution, delivery and performance by the Borrower of this Agreement, if
any, shall have been obtained and be in full force and effect, and there shall
be no litigation, governmental,
33
administrative or judicial action, actual or threatened, that could reasonably
be expected to restrain, prevent or impose burdensome conditions on the
transactions contemplated hereby.
(i) The Administrative Agent shall have received all financial statements
and other information as the Administrative Agent shall reasonably request,
including projections and pro forma balance sheets adjusted to give effect to
the financing contemplated hereby, and such financial statements shall not, in
the reasonable judgment of the Banks, reflect any material adverse change in the
consolidated financial condition of the Borrower and its Subsidiaries, as
reflected in the financial statements or projections contained in the
Confidential Information Memorandum.
(j) The Administrative Agent shall have received such other customary
supporting documents as the Administrative Agent or the Banks, through the
Administrative Agent, may reasonably request.
(k) The Administrative Agent shall have received all fees and reimbursement
of all expenses required to be paid on or before the Closing Date.
(l) The representations and warranties of the Borrower contained in Section
7.1 of this Agreement shall be true and correct in all material respects, before
and after giving effect to the making of the Loans on the Closing Date, and to
the application of the proceeds therefrom.
(m) The Facility shall be rated (i) BBB- or better by Fitch and (ii) Baa3
or better by Xxxxx'x.
(n) No Default or Event of Default shall have occurred and be continuing or
would result from the making of the Loans on the Closing Date.
The Administrative Agent shall notify the Borrower and the Banks of the
effectiveness of this agreement, and such notice shall be conclusive and
binding.
ARTICLE VII
REPRESENTATIONS AND WARRANTIES
SECTION 7.1. Representations and Warranties of the Borrower. The Borrower
represents and warrants as follows:
(a) Corporate Status of the Borrower. The Borrower (i) is validly organized
and existing as a limited liability company and in good standing under the laws
of its jurisdiction of organization; (ii) is duly authorized or qualified to do
business in and is in good standing in each other jurisdiction in which the
conduct of its business or the ownership or leasing of its Property requires it
to be so authorized or qualified to do business, except where the failure to be
so duly authorized or qualified or in good standing, individually or in the
aggregate, would not have a Material Adverse Effect; and (iii) has the corporate
or other requisite power and authority to conduct its business, as presently
conducted.
34
(b) Corporate Status of Subsidiaries of the Borrower. Each Subsidiary of
the Borrower (i) is validly organized and existing and in good standing under
the laws of the jurisdiction of its organization and is duly authorized or
qualified to do business in and is in good standing in each other jurisdiction
in which the conduct of its business or the ownership or leasing of its Property
requires it to be so authorized or qualified to do business, except where the
failure to be so validly organized and existing or duly authorized or qualified
or in good standing, individually or in the aggregate, would not have a Material
Adverse Effect and (ii) has the corporate, partnership or other requisite power
and authority to conduct its business, as presently conducted, except where the
failure to have such power and authority, individually or in the aggregate,
would not have a Material Adverse Effect.
(c) Corporate Powers. The Borrower has the corporate or other requisite
power to execute, deliver and perform and comply with its obligations under this
Agreement, any Notes and the other Loan Documents to which it is a party. This
Agreement has been, and each other Loan Document to which the Borrower is a
party will be, duly executed and delivered on behalf of the Borrower.
(d) Authorization; No Conflict, Etc. The borrowings by the Borrower
contemplated by this Agreement, the execution and delivery by the Borrower of
this Agreement and the other Loan Documents to which it is a party and the
performance by the Borrower of its obligations hereunder and thereunder have
been duly authorized by all requisite corporate or other requisite action on the
part of the Borrower and CenterPoint and do not and will not (i) violate any
law, any order to which the Borrower or CenterPoint or any of their respective
Subsidiaries is subject of any court or other Governmental Authority, or the
articles of incorporation or bylaws or other organizational documents (each as
amended from time to time) of CenterPoint, the Borrower or any of their
respective Subsidiaries; (ii) violate, conflict with, result in a breach of or
constitute (with due notice or lapse of time or both, or any other condition) a
default under, any indenture, loan agreement or other agreement to which
CenterPoint, the Borrower or any of their respective Subsidiaries is a party or
by which CenterPoint, the Borrower or any of their respective Subsidiaries, or
any of their respective Property, is bound (except for such violations,
conflicts, breaches or defaults that, individually or in the aggregate, do not
have or would not have a Material Adverse Effect); or (iii) result in, or
require, the creation or imposition of any material Lien upon any of the
Properties of the Borrower or any Significant Subsidiary.
(e) Governmental Approvals and Consents. No authorization or approval or
action by, and no notice to or filing with, any Governmental Authority is
required for the due execution, delivery and performance by the Borrower of this
Agreement and the other Loan Documents to which it is a party.
(f) Obligations Binding. This Agreement and the other Loan Documents to
which the Borrower is a party are the legal, valid and binding obligations of
the Borrower enforceable against the Borrower in accordance with their
respective terms (assuming due and valid authorization, execution and delivery
of this Agreement by any party other than the Borrower), except as such
enforceability may be (i) limited by the effect of any applicable bankruptcy,
insolvency, reorganization, moratorium or other similar laws relating to or
affecting the enforcement of creditors' rights generally and (ii) subject to the
effect of general principles of
35
equity (regardless of whether such enforceability is considered in a proceeding
in equity or at law).
(g) Use of Proceeds; Margin Stock. The proceeds of the Loans will be used
by the Borrower (a) to repay all amounts due or outstanding under the Existing
Credit Agreement, (b) to consummate the FinanceCo Permitted Refinancing, (c) to
pay fees and expenses incurred in relation to the Facility and (d) for other
general corporate purposes. Neither the Borrower nor any Subsidiary of the
Borrower is principally engaged in, or has as one of its important activities,
the business of extending credit for the purpose of purchasing or carrying any
Margin Stock, and no part of the proceeds of any Loan made to the Borrower will
be used for any purpose that would violate the provisions of the margin
regulations of the Board.
(h) Title to Properties. The issued and outstanding Capital Stock owned by
the Borrower of each of its Significant Subsidiaries whether such stock is owned
directly or indirectly through one or more of its Subsidiaries, is owned free
and clear of any Lien. In addition, each of the Borrower and each Significant
Subsidiary of the Borrower has good title to the Properties reflected in the
financial statements referred to in Section 7.1(m) and in any financial
statements delivered pursuant to Section 8.1(a), except for such Properties that
have been disposed of subsequent to the dates of the balance sheets included in
such financial statements and that are no longer used or useful in the conduct
of the business of the Borrower or any Significant Subsidiary of the Borrower or
that have been disposed of pursuant to Section 8.2(b) or (c) or that have been
disposed of in the ordinary course of their respective business, and all such
Properties are free and clear of any Lien except (i) in the case of the Property
of the Borrower, the Mortgage and the Second Mortgage Indenture and the Liens
permitted thereby and hereby; (ii) Liens that do not interfere with the use of
such Properties for the purposes for which they are held; (iii) minor Liens and
defects of title that are not material either individually or in the aggregate;
and (iv) Permitted Liens.
(i) Investment Company Act. Neither the Borrower nor any Subsidiary of the
Borrower is an "investment company" as defined in, or otherwise subject to
regulation under, the Investment Company Act of 1940, as amended.
(j) Material Adverse Change. Except as otherwise disclosed prior to the
date hereof in writing to the Banks or in the Borrower's public filings with the
SEC, since December 31, 2001, there has been no event, development or
circumstance that has or would reasonably be expected to have a Material Adverse
Effect, it being agreed that, on and after the Closing Date, this representation
shall apply, with respect to periods prior to the Closing Date, to the portion
of the business included in the business of the Borrower and the Consolidated
Subsidiaries on the Closing Date.
(k) Litigation. There is no litigation, action, suit or other legal or
governmental proceeding pending or, to the best knowledge of the Borrower,
threatened, at law or in equity, or before or by any arbitrator or Governmental
Authority (i) relating to the transactions under this Agreement or (ii) in which
there is a reasonable possibility of an adverse decision that would have a
Material Adverse Effect.
36
(l) ERISA. Neither the Borrower nor any of its Significant Subsidiaries has
incurred any material liability or deficiency arising out of or in connection
with (i) any Reportable Event or "accumulated funding deficiency" (within the
meaning of Section 412 of the Code or Section 302 of ERISA) with respect to any
Plan that has occurred during the five-year period immediately preceding the
date on which this representation is made or deemed made, (ii) any failure of a
Plan to comply with the applicable provisions of ERISA and the Code, (iii) any
termination of a Single Employer Plan, (iv) any complete or partial withdrawal
by the Borrower or any Commonly Controlled Entity from any Multiemployer Plan or
(v) any Lien in favor of the PBGC or any Plan that has arisen during the
five-year period referred to in clause (i) above. In addition, no Multiemployer
Plan is in Reorganization or is Insolvent, where such Reorganization or
Insolvency, individually or when aggregated with the events described in the
first sentence of this Section 7.1(l), is likely to result in a material
liability or deficiency of the Borrower or any of its Significant Subsidiaries.
As used in this Section 7.1(1), any liability or deficiency shall be deemed not
to be "material" so long as the sum of all liabilities and deficiencies referred
to in this Section 7.1(l) at any one time outstanding, individually and in the
aggregate, is less than $25,000,000.
(m) Financial Statements. The pro forma, unaudited, condensed, consolidated
financial statements of the Borrower as of and for the six months ended June 30,
2002 filed with the SEC on September 6, 2002 as Exhibit 99.1 to the Borrower's
Form 8-K/A dated August 31, 2002, copies of which have been delivered to the
Banks, present fairly the pro forma, condensed, consolidated financial condition
and results of operations of the Borrower and its Consolidated Subsidiaries as
of such date and for the period then ended, in conformity with, as applicable,
GAAP and the regulations promulgated under the Securities Act and, except as
otherwise stated therein, consistently applied (in the case of such unaudited
statements, subject to year-end adjustments and the exclusion of detailed
footnotes).
(n) Accuracy of Information. None of the documents or written information
(excluding estimates, financial projections and forecasts) provided by the
Borrower to the Banks in connection with or pursuant to this Agreement contains
as of the date thereof or will contain as of the date thereof any untrue
statement of a material fact or omits or will omit to state as of the date
thereof a material fact (other than industry wide risks normally associated with
the types of businesses conducted by the Borrower and its Subsidiaries)
necessary to make the statements therein, in the light of the circumstances
under which they were made, not materially misleading, as a whole. The
estimates, financial projections and forecasts furnished to the Banks by the
Borrower with respect to the transactions contemplated under this Agreement were
prepared in good faith and on the basis of information and assumptions that the
Borrower believed to be reasonable as of the date of such information, it being
recognized by the Banks that such estimates, financial projections and forecasts
as they relate to future events are not to be viewed as fact and that actual
results during the period or periods covered by such estimates, financial
projections and forecasts may differ from the projected results set forth
therein by a material amount.
(o) No Violation. The Borrower is not in violation of any order, writ,
injunction or decree of any court or any order, regulation or demand of any
Governmental Authority that, individually or in the aggregate, reasonably could
be expected to have a Material Adverse Effect.
37
(p) Subsidiaries. Schedule 1.1(A) attached hereto sets forth each
Significant Subsidiary of the Borrower as of the Closing Date.
(q) The Pledge Agreement; Second Mortgage Indenture. The Pledge Agreement
is effective to create in favor of the Administrative Agent, for the benefit of
the Banks, a legal, valid and enforceable security interest in the Collateral
described therein and proceeds thereof. When financing statements and other
filings specified on Schedule 7.1(q) in appropriate form are filed in the
offices specified on Schedule 7.1(q), the Pledge Agreement shall constitute a
fully perfected Lien on, and security interest in, all right, title and interest
of the Loan Parties in such Collateral and the proceeds thereof, as security for
the Obligations (as defined in the Pledge Agreement), in each case prior and
superior in right to any other Person (except Liens permitted by Section 8.2).
The Second Mortgage Indenture is effective to create in favor of the Trustee,
for the ratable benefit of the bondholders from time to time under the Second
Mortgage Indenture, a legal, valid and enforceable Lien on all the Borrower's
right, title and interest in and to the Mortgaged Property and the proceeds
thereof, and the Second Mortgage Indenture constitutes a fully perfected Lien
on, and security interest in, all right, title and interest of the Borrower and
in such Mortgaged Property and the proceeds thereof, in each case prior and
superior in right to any other Person (except Liens permitted by Section 8.2).
(r) Taxes. The Borrower and each of its Subsidiaries has filed or caused to
be filed all Federal, state and other material tax returns that are required to
be filed and has paid all taxes shown to be due and payable on said returns or
on any assessments made against it or any of its Property and all other taxes,
fees or other charges imposed on it or any of its Property by any Governmental
Authority (other than any the amount or validity of which are currently being
contested in good faith by appropriate proceedings and with respect to which
reserves in conformity with GAAP have been provided on the books of the Borrower
or its Subsidiaries), except where the failure to do so could not, individually
or in the aggregate, reasonably be expected to have a Material Adverse Effect;
no tax Lien has been filed, and, to the knowledge of the Borrower, no claim is
being asserted, with respect to any such tax, fee or other charges (other than
any Liens or claims that could not, individually or in the aggregate, reasonably
be expected to have a Material Adverse Effect).
(s) Solvency. On and as of the Closing Date, after giving effect to the
borrowings of Loans on the Closing Date and the other transactions contemplated
hereby and thereby, the Borrower will be Solvent.
ARTICLE VIII
AFFIRMATIVE AND NEGATIVE COVENANTS
SECTION 8.1. Affirmative Covenants of the Borrower. The Borrower covenants
that, as long as any amount is owing hereunder or under any other Loan Documents
is outstanding or any Bank shall have any Commitment outstanding under this
Agreement:
(a) Delivery of Financial Statements, Notices and Certificates. The
Borrower shall deliver to the Administrative Agent for distribution to the Banks
sufficient copies for each of the Banks of the following:
38
(i) as soon as practicable and in any event within 120 days after the
end of each fiscal year of the Borrower (beginning with fiscal 2002), a
consolidated balance sheet of the Borrower and the Consolidated
Subsidiaries of the Borrower as of the end of such fiscal year and the
related statements of consolidated income, retained earnings and cash flows
prepared in conformity with GAAP consistently applied, setting forth in
comparative form the figures for the previous fiscal year, together with a
report thereon (which shall not contain any "going concern" or similar
qualifications) by independent certified public accountants of nationally
recognized standing selected by the Borrower (which requirement may be
satisfied by delivering the Borrower's Annual Report on Form 10-K with
respect to such fiscal year as filed with the SEC);
(ii) as soon as practicable and in any event within 60 days after the
end of each of the first three quarters of each fiscal year of the Borrower
(beginning with the quarter ending September 30, 2002), unaudited
consolidated financial statements of the Borrower and the Consolidated
Subsidiaries of the Borrower consisting of at least consolidated balance
sheets as at the close of such quarter and statements of consolidated
income, retained earnings and cash flows for such quarter and for the
period from the beginning of such fiscal year to the close of such quarter
(which requirement may be satisfied by delivering the Borrower's Quarterly
Report on Form 10-Q with respect to such fiscal quarter as filed with the
SEC); such financial statements shall be accompanied by a certificate of a
Responsible Officer of the Borrower to the effect that such unaudited
financial statements present fairly in all material respects the
consolidated financial condition and results of operations of the Borrower
and the Consolidated Subsidiaries of the Borrower as of such date for the
period then ending, and have been prepared in conformity with GAAP in a
manner consistent with the financial statements referred to in paragraph
(a)(i) above (subject to year-end adjustments and exclusion of detailed
footnotes);
(iii) with each set of statements to be delivered above, a certificate
in a form reasonably satisfactory to the Administrative Agent, signed by a
Responsible Officer of the Borrower confirming compliance with Section
8.2(a) and setting out in reasonable detail the calculations necessary to
demonstrate such compliance as at the date of the most recent balance sheet
included in such financial statements and stating that no Default or Event
of Default has occurred and is continuing or, if there is any Default or
Event of Default, describing it and the steps, if any, being taken to cure
it; and
(iv) (A) within ten (10) days of the filing thereof, copies of all
periodic reports (other than (x) reports on Form 11-K or any successor
form, (y) Current Reports on Form 8-K that contain no information other
than exhibits filed therewith and (z) reports on Form 10-Q or 10-K or any
successor forms) under the Exchange Act (in each case other than exhibits
thereto and documents incorporated by reference therein)) filed by the
Borrower with the SEC; (B) promptly, and in any event within seven (7) days
after a Responsible Officer of the Borrower becomes aware of the occurrence
thereof, written notice of (x) any Event of Default or any Default, (y) the
institution of any litigation, action, suit or other legal or governmental
proceeding involving the Borrower or any Subsidiary of the Borrower as to
which there is a reasonable possibility of an adverse decision that would
have a Material Adverse Effect on the Borrower or any final adverse
39
determination in any litigation, action, suit or other legal or
governmental proceeding involving the Borrower or any Significant
Subsidiary of the Borrower that would have a Material Adverse Effect, or
(z) the incurrence by the Borrower or any Subsidiary of a material
liability or deficiency, or the existence of a reasonable possibility of
incurring a material liability or deficiency, arising out of or in
connection with (1) any Reportable Event with respect to any Plan, (2) the
failure to make any required contribution to a Plan, (3) the creation of
any Lien in favor of the PBGC or a Plan, (4) any withdrawal from, or the
termination, Reorganization or Insolvency of, any Multiemployer Plan or (5)
the institution of proceedings or the taking of any other action by the
PBGC or the Borrower or any Commonly Controlled Entity or any Multiemployer
Plan with respect to the withdrawal from, or the termination,
Reorganization or Insolvency of, any Plan; provided that, as used in this
clause (z), any liability or deficiency shall be deemed not to be
"material" so long as the sum of all liabilities and deficiencies referred
to in this clause (z) at any one time outstanding, individually and in the
aggregate, is less than $25,000,000; (C) with each set of statements
delivered pursuant to Section 8.1(a)(i), a certificate signed by a
Responsible Officer of the Borrower identifying those Subsidiaries which,
determined as of the date of such financial statements, are Significant
Subsidiaries; and (D) such other information relating to the Borrower or
its business, properties, condition and operations as the Administrative
Agent (or any Bank through the Administrative Agent) may reasonably
request.
Information required to be delivered pursuant to the foregoing
Sections 8.1(a)(i), (ii), and (iv)(A) shall be deemed to have been
delivered on the date on which the Borrower provides notice (including
notice by e-mail) to the Administrative Agent (which notice the
Administrative Agent will convey promptly to the Banks) that such
information has been posted on the SEC website on the Internet at
xxx.xxx/xxxxx/xxxxxxxx.xxx or at another website identified in such notice
and accessible by the Banks without charge; provided that (i) such notice
may be included in a certificate delivered pursuant to Section 8.1(a)(iii)
and (ii) the Borrower shall deliver paper copies of such information to the
Administrative Agent, and the Administrative Agent shall deliver paper
copies of such information to any Bank that requests such delivery.
(b) Use of Proceeds. The Borrower will use the proceeds of any Loan made by
the Banks to it for the purposes set forth in the first sentence of Section
7.1(g), and it will not use the proceeds of any Loan made by the Banks for any
purpose that would violate the provisions of the margin regulations of the
Board. Without limiting the foregoing, the Borrower shall consummate the
FinanceCo Permitted Refinancing on November 15, 2002, and, pending such
refinancing, shall maintain the proceeds of the Loans to be used therefor in
Cash Equivalents in an account in its own name. The Borrower will not, and will
not permit any of its Subsidiaries to engage principally, or as one of its
important activities, in the business of extending credit for the purpose of
purchasing or carrying, within the meaning of Regulation U, any Margin Stock.
(c) Existence; Laws. The Borrower will, and will cause each of its
Subsidiaries to, do or cause to be done all things necessary (i) to preserve,
renew and keep in full force and effect its legal existence and all rights,
licenses, permits and franchises (except to the extent otherwise permitted by
Sections 8.2(c) or 8.2(e)) and (ii) to comply with all laws and regulations
40
applicable to it, except in each case where the failure to do so, individually
or in the aggregate, could not reasonably be expected to have a Material Adverse
Effect.
(d) Payment of Obligations. The Borrower will, and will cause each of its
Subsidiaries to, pay its obligations, including any tax liabilities, that, if
not paid, could result in a Material Adverse Effect before the same shall become
delinquent or in default, except where (a) the validity or amount thereof is
being contested in good faith by appropriate proceedings, (b) the Borrower or
such Subsidiary has set aside on its books adequate reserves with respect
thereto in accordance with GAAP and (c) the failure to make payment pending such
contest could not reasonably be expected to have a Material Adverse Effect.
(e) Maintenance of Properties. The Borrower will, and will cause each of
its Significant Subsidiaries to, preserve and maintain all of its Property that
is material to the conduct of its business and keep the same in good repair,
working order and condition, and from time to time to make, or cause to be made,
such repairs, renewals and replacements thereto as in the good faith judgment of
the Borrower or such Subsidiary, as the case may be, are necessary or proper so
that the business carried on in connection therewith may be properly conducted
at all times, provided, however, that nothing in this Section 8.1(e) shall
prevent (a) the Borrower or any of its Subsidiaries from selling, abandoning or
otherwise disposing of any Properties (including the Capital Stock of any
Subsidiary of the Borrower that is not a Significant Subsidiary of the
Borrower), the retention of which in the good faith judgment of the Borrower or
such Subsidiary is inadvisable or unnecessary to the business of the Borrower
and its Subsidiaries, taken as a whole, as the case may be or (b) any other
transaction that is expressly permitted by the terms of any other provision of
this Agreement.
(f) Maintenance of Business Line. The Borrower will maintain its
fundamental business of providing services and products in the energy market.
(g) Books and Records; Access. The Borrower will, and will cause each
Significant Subsidiary to, keep proper books of record and account in which
full, true and correct entries are made of all dealings and transactions in
relation to its business and activities as required by GAAP. The Borrower will,
and will cause each of its Subsidiaries to, at any reasonable time and from time
to time, permit up to six representatives of the Banks designated by the
Majority Banks, or representatives of the Administrative Agent, on not less than
five (5) Business Days' notice, to examine and make copies of and abstracts from
the records and books of account of, and visit the properties of, the Borrower
and each Significant Subsidiary and to discuss the general business affairs of
the Borrower and each of its Subsidiaries with their respective officers and
independent certified public accountants; subject, however, in all cases to the
imposition of such conditions as the Borrower and each of its Subsidiaries shall
deem necessary based on reasonable considerations of safety and security;
provided, however, that neither the Borrower nor any of its Subsidiaries shall
be required to disclose to the Administrative Agent, any Bank or any agents or
representatives thereof any information which is the subject of attorney-client
privilege or attorney work-product privilege properly asserted by the applicable
Person to prevent the loss of such privilege in connection with such information
or which is prevented from disclosure pursuant to a confidentiality agreement
with third parties. Notwithstanding the foregoing, none of the conditions
precedent to the exercise of the right of access described in the preceding
sentence that relate to notice requirements or limitations on the
41
Persons permitted to exercise such right shall apply at any time when a Default
or an Event of Default shall have occurred and be continuing.
(h) Insurance. The Borrower will and will cause each of its Subsidiaries
to, maintain insurance with responsible and reputable insurance companies or
associations, or to the extent that the Borrower or such Subsidiary deems it
prudent to do so, through its own program of self-insurance, in such amounts and
covering such risks as is usually carried by companies engaged in similar
businesses, of comparable size and financial strength and with comparable risks.
(i) Long-Term Debt Rating. The Borrower will deliver to the Administrative
Agent notice of any change by a Rating Agency in the Long-Term Debt Rating or in
any rating by a Rating Agency for the Facility, promptly upon the effectiveness
of any such change.
SECTION 8.2. Negative Covenants of the Borrower. The Borrower covenants
that, so long as any amount is owing to the Banks hereunder or under any other
Loan Document to which it is a party, the Borrower will not:
(a) Financial Ratio. Permit the ratio of Consolidated Indebtedness for
Borrowed Money to Consolidated Capitalization to exceed 0.68:1.00.
(b) Certain Liens. And will not permit any of its Subsidiaries to, pledge,
mortgage, hypothecate or xxxxx x Xxxx upon, or permit any mortgage, pledge,
security interest or other Lien upon, any Property of the Borrower or any
Subsidiary of the Borrower now or hereafter owned directly or indirectly by the
Borrower; provided, however, that this restriction shall neither apply to nor
prevent the creation or existence of:
(i) Permitted Liens;
(ii) Liens on preference stock or related rights securing any
FinanceCo Permitted Facility;
(iii) any Lien in existence on the date hereof, provided that no such
Lien encumbers any additional Property after the Closing Date and that the
amount of Indebtedness secured thereby is not increased;
(iv) Liens securing first mortgage bonds pursuant to the Mortgage (or
second or subordinated Liens in lieu thereof) issued after the Closing Date
so long as the net cash proceeds of such issuances are (A) applied to
replace first mortgage bonds issued under the Mortgage and outstanding on
the Closing Date or (B) proceeds of Indebtedness for Borrowed Money in an
aggregate principal amount at any time outstanding not in excess of (x)
$300,000,000 less (y) the amount of outstanding Indebtedness secured by
Liens pursuant to Section 8.2(b)(xv);
(v) Liens required to be granted pursuant to "equal and ratable"
clauses under Contractual Obligations of the Borrower and its Significant
Subsidiaries existing on the Closing Date;
42
(vi) Liens on fixed or capital assets and related inventory and
intangible assets acquired, constructed, improved, altered or repaired
by the Borrower or any of its Significant Subsidiaries; provided that
(i) such Liens secure Indebtedness otherwise permitted by this
Agreement, (ii) such Liens and the Indebtedness secured thereby are
incurred prior to or within 365 days after such acquisition or the
later of the completion of such construction, improvement, alteration
or repair or the date of commercial operation of the assets
constructed, improved, altered or repaired, (iii) the Indebtedness
secured thereby does not exceed the cost of acquiring, constructing,
improving, altering or repairing such fixed or capital assets, as the
case may be, and (iv) such Lien shall not apply to any other property
or assets of the Borrower or of its Significant Subsidiaries (other
than repairs, renewals, replacements, additions, accessions,
improvements and betterments thereto);
(vii) Liens on Property and repairs, renewals, replacements,
additions, accessions, improvements and betterments thereto existing
at the time such Property is acquired by the Borrower or any of its
Significant Subsidiaries and not created in contemplation of such
acquisition (or on repairs, renewals, replacements, additions,
accessions and betterments thereto), and Liens on the Property of any
Person at the time such Person becomes a Subsidiary of the Borrower
and not created in contemplation of such Person becoming a Subsidiary
of the Borrower (or on repairs, renewals, replacements, additions,
accessions and betterments thereto);
(viii) rights reserved to or vested in any Governmental Authority
by the terms of any right, power, franchise, grant, license or permit,
or by any Requirements of Law, to terminate such right, power,
franchise, grant, license or permit or to purchase, condemn,
expropriate or recapture or to designate a purchaser of any of the
Property of the Borrower or any of its Subsidiaries;
(ix) rights reserved to or vested in (or exercised by) any
Governmental Authority to control, regulate or use any Property of a
Person or its activities, including zoning, planning and environmental
laws and ordinances and municipal regulations;
(x) Liens on Property of the Borrower or any of its Subsidiaries
securing non-recourse Indebtedness of the Borrower or any such
Subsidiary;
(xi) Liens on the stock or assets of Securitization Subsidiaries;
(xii) any extension, renewal or refunding of any Lien permitted
by clauses (i) through (xi) above on the same Property previously
subject thereto; provided that no extension, renewal or refunding of
any such Lien shall increase the principal amount of any Indebtedness
secured thereby immediately prior to such extension, renewal or
refunding, unless such Indebtedness is permitted by Section 8.2(a);
(xiii) Liens on cash collateral provided in lieu of repayment of
pollution control bonds until the remarketing of such bonds;
43
(xiv) Liens on cash collateral to secure obligations of the
Borrower and its Subsidiaries in respect of cash management
arrangements with any Bank or Affiliate thereof; and
(xv) Liens not otherwise permitted by this Section 8.2(b)
securing Indebtedness of the Borrower and its Significant Subsidiaries
so long as the aggregate outstanding principal amount of the
obligations secured thereby does not at any time exceed (as to the
Borrower and all of its Subsidiaries) $15,000,000 at such time.
(c) Consolidation, Merger or Disposal of Assets. And will not permit any of
its Significant Subsidiaries to, (i) consolidate with, or merge into or
amalgamate with or into, any other Person; (ii) liquidate, wind up or dissolve
itself (or suffer any liquidation or dissolution); or (iii) convey, sell,
transfer, lease or otherwise dispose of all or substantially all of its
Properties, or the Capital Stock of any Significant Subsidiary of the Borrower,
to any Person; provided, however, that nothing contained in this Section 8.2(c)
shall prohibit (A) a merger involving a Subsidiary of the Borrower other than
the Borrower (including mergers to reincorporate or change the domicile of such
Subsidiary) if the Borrower or a Wholly-Owned Significant Subsidiary of the
Borrower is the surviving entity thereof; (B) the liquidation, winding up or
dissolution of a Significant Subsidiary of the Borrower (other than the
Borrower) if all of the Properties of such Significant Subsidiary are conveyed,
transferred or distributed to the Borrower or a Wholly-Owned Significant
Subsidiary of the Borrower or (C) the conveyance, sale, transfer or other
disposal of all or substantially all (or any lesser portion) of the Properties
of any Significant Subsidiary (other than the Borrower) to the Borrower or a
Wholly-Owned Significant Subsidiary of the Borrower or (D) the transfer of
assets in connection with the issuance of Securitization Securities; provided
that, in each case, immediately before and after giving effect to any such
merger, dissolution or liquidation, or conveyance, sale, transfer, lease or
other disposition, no Default or Event of Default shall have occurred and be
continuing.
(d) Takeover Bids. And will not permit any of its Subsidiaries to, use the
proceeds of any Loan made to it to participate in any unsolicited control bid
for any other Person.
(e) Sale of Significant Subsidiary Stock. And will not permit any
Significant Subsidiary to sell, assign, transfer or otherwise dispose of any of
the Capital Stock of any Significant Subsidiary other than to a Wholly-Owned
Subsidiary of the Borrower that constitutes a Significant Subsidiary after
giving effect to such transaction; provided that immediately before and after
giving effect to such sale, assignment, transfer or other disposition, no Event
of Default or Default shall have occurred and be continuing. Notwithstanding the
foregoing provisions of this Section 8.2(e), any Significant Subsidiary shall
have the right to issue, sell, assign, transfer or otherwise dispose of for
value its preference or preferred stock in one or more bona fide transactions to
any Person.
(f) Agreements Restricting Dividends. And will not permit any of its
Significant Subsidiaries to enter into, incur or permit to exist any agreement
or other arrangement that explicitly prohibits or restricts the payment by any
of its Significant Subsidiaries of dividends or other distributions with respect
to any shares of its Capital Stock; provided that the foregoing shall not
prohibit financial incurrence, maintenance and similar covenants that indirectly
have the practical effect of prohibiting or restricting the ability of a
Significant Subsidiary to make
44
such payments or provisions that require that a certain amount of capital be
maintained, or prohibit the return of capital to shareholders above certain
dollar limits; provided further, that the foregoing shall not apply to (i)
restrictions and conditions imposed by law or by this Agreement, (ii)
restrictions and conditions existing on the date hereof, any amendment or
modification thereof (other than an amendment or modification expanding the
scope of any such restriction or condition and any restrictions or conditions)
that (x) replace restrictions or conditions existing on the date hereof and (y)
are substantially similar to such existing restriction or condition, (iii)
restrictions (including any extension of such restrictions that does not expand
the scope of any such restrictions) existing at the time at which any such
Subsidiary first becomes a Significant Subsidiary, so long as such restriction
was in existence prior to such time in accordance with the other provisions of
this Agreement and was not agreed to or incurred in contemplation of such change
of status and (iv) any restrictions with respect to a Significant Subsidiary
imposed pursuant to an agreement that has been entered into in connection with a
disposition of all or substantially all of the Capital Stock or assets of such
Subsidiary.
(g) Certain Investments, Loans, Advances, Guarantees and Acquisitions. And
will not permit any of its Subsidiaries to, purchase, or acquire (including
pursuant to any merger) any Capital Stock, evidences of indebtedness or other
securities of or other interest in (including any option, warrant or other right
to acquire any of the foregoing), make any loans or advances to, Guarantee any
obligations of, or make any investment or other interest in or capital
contribution to, any other Person, or purchase or otherwise acquire (in one
transaction or a series of transactions) any assets of any other Person
constituting a business unit (any of the foregoing, an "Investment"), in each
case after the Closing Date, except that, notwithstanding the foregoing, the
Borrower and its Subsidiaries may make Investments (a) in Cash Equivalents; (b)
in any Wholly-Owned Subsidiary of the Borrower; (c) in pollution control bonds
which are the obligation of the Borrower in connection with and until the
remarketing of such bonds, (d) otherwise if, after giving effect thereto, the
Borrower would be in compliance with its covenants contained in Section 8.2(a)
on a pro forma basis and the aggregate amount of all such Investments
(including, without limitation, any Guarantee, loan, advance or any assumed
Indebtedness) described in this clause (d) shall not exceed $100,000,000
outstanding at any time.
(h) Maintenance of Corporate Separateness. (i) And will not permit any of
its Subsidiaries (as used in this paragraph, the Borrower and its Subsidiaries
are referred to collectively as the "Borrower Parties") to commingle any of
their respective bank accounts with any bank account of CenterPoint or any of
its Subsidiaries (as used in this paragraph, CenterPoint and its Subsidiaries
(other than the Borrower Parties) are referred to collectively as the
"CenterPoint Parties"); (ii) any financial statements distributed to any
creditors of any Borrower Party shall, to the extent permitted under GAAP,
clearly establish the corporate separateness of the Borrower Parties from the
CenterPoint Parties; and (iii) no Borrower Party shall take any action, or
conduct its affairs in a manner, which is reasonably likely to result in the
corporate existence of the Borrower Parties (or any of them), on the one hand,
and the CenterPoint Parties (or any of them), on the other hand, being ignored,
or in the assets and liabilities of the Borrower Parties (or any of them) being
substantively consolidated with those of the CenterPoint Parties (or any of
them) in a bankruptcy, reorganization or other insolvency proceeding.
45
(i) Changes in Lines of Business. Enter into any business, either directly
or through any of its Subsidiaries, except for those businesses in which the
Borrower and its Subsidiaries are engaged on the date of this Agreement or that
are directly related thereto.
ARTICLE IX
EVENTS OF DEFAULT
SECTION 9.1. Events of Default. The occurrence of any of the following
events shall constitute an "Event of Default":
(a) Non-Payment of Principal and Interest. The Borrower fails to pay, in
the manner provided in this Agreement, (i) any principal payable by it hereunder
when due or (ii) any interest payment, or the fee payable pursuant to Section
4.2 payable by it hereunder, within five (5) Business Days after its due date;
or
(b) Non-Payment of Other Amounts. The Borrower fails to pay, in the manner
provided in this Agreement, any other amount (other than the amounts set forth
in Section 9.1(a) above) payable by it hereunder within ten (10) Business Days
after notice of such payment is received by the Borrower from the Administrative
Agent; or
(c) Breach of Representation or Warranty. Any representation or warranty by
the Borrower in Section 7.1 or in any certificate, document or instrument
delivered under this Agreement shall have been incorrect in any material respect
when made or when deemed hereunder to have been made; or
(d) Breach of Certain Covenants. The Borrower fails to perform or comply
with any one or more of its obligations under Section 8.1(a)(iv)(B)(x), 8.2 or
Section 5 of the Pledge Agreement; or
(e) Breach of Other Obligations. The Borrower does not perform or comply
with any one or more of its other obligations under this Agreement (other than
those set forth in Section 9.1(a), (b) or (d) above) and such failure to perform
or comply shall not have been remedied within 30 days after the earlier of
notice thereof to it by the Administrative Agent or the Majority Banks or
discovery thereof by a Responsible Officer of the Borrower; or
(f) Other Indebtedness. (i) The Borrower or any of its Significant
Subsidiaries fails to pay when due (either at stated maturity or by acceleration
or otherwise but subject to applicable grace periods) any principal or interest
in respect of any Indebtedness for Borrowed Money, Secured Indebtedness
(including Indebtedness under the Mortgage and the Second Mortgage Indenture) or
Junior Subordinated Debt (other than Indebtedness of the Borrower under this
Agreement) if the aggregate principal amount of all such Indebtedness for which
such failure to pay shall have occurred and be continuing exceeds $50,000,000 or
(ii) any default, event or condition shall have occurred and be continuing with
respect to any Indebtedness for Borrowed Money, Secured Indebtedness (including
Indebtedness under the Mortgage and the Second Mortgage Indenture) or Junior
Subordinated Debt of the Borrower or any of its Significant Subsidiaries (other
than Indebtedness of the Borrower under this Agreement), the
46
effect of which default, event or condition is to cause, or to permit the holder
thereof to cause, (A) such Indebtedness to become due prior to its stated
maturity (other than in respect of mandatory prepayments required thereby) or
(B) in the case of any Guarantee of Indebtedness for Borrowed Money of any
Person or Junior Subordinated Debt by the Borrower or any of its Significant
Subsidiaries the primary obligation (as such term is defined in the definition
of "Guarantee" in Section 1.1) to which such Guarantee relates to become due
prior to its stated maturity, if the aggregate amount of all such Indebtedness
or primary obligations (as the case may be) that is or could be caused to be due
prior to its stated maturity exceeds $50,000,000; or
(g) Involuntary Bankruptcy, Etc. (i) There shall be commenced against the
Borrower or any of its Significant Subsidiaries any case, proceeding or other
action (A) seeking a decree or order for relief in respect of the Borrower or
any of its Significant Subsidiaries under any applicable domestic or foreign
bankruptcy, insolvency, reorganization or other similar law, (B) seeking a
decree or order adjudging the Borrower or any of its Significant Subsidiaries a
bankrupt or insolvent, (C) except as permitted by clause (B) of the proviso to
Section 8.2(c), seeking reorganization, arrangement, adjustment, winding-up,
liquidation, dissolution, composition or other similar relief of or in respect
of the Borrower or any of its Significant Subsidiaries or their respective debts
under any applicable domestic or foreign law or (D) seeking the appointment of a
custodian, receiver, conservator, liquidator, assignee, trustee, sequestrator or
other similar official of the Borrower or any of its Significant Subsidiaries or
of any substantial part of their respective Properties, or the liquidation of
their respective affairs, and such petition is not dismissed within 90 days or
(ii) a decree, order or other judgment is entered in respect of any of the
remedies, reliefs or other matters for which any petition referred to in (i)
above is presented or (iii) there shall be commenced against the Borrower or any
of its Significant Subsidiaries any case, proceeding or other action seeking
issuance of a warrant of attachment, execution, distraint or similar process
against all or any substantial part of its assets that results in the entry of
an order for any such relief that shall not have been vacated, discharged or
stayed or bonded pending appeal within 90 days from the entry thereof; or
(h) Voluntary Bankruptcy, Etc. (i) The commencement by the Borrower or any
of its Significant Subsidiaries of a voluntary case, proceeding or other action
under any applicable domestic or foreign bankruptcy, insolvency, reorganization
or other similar law (A) seeking to have an order of relief entered with respect
to it, (B) seeking to be adjudicated a bankrupt or insolvent, (C) seeking
reorganization, arrangement, adjustment, winding-up, liquidation, dissolution,
composition or other similar relief with respect to it or its debts under any
applicable domestic or foreign law or (D) seeking the appointment of or the
taking possession by a custodian, receiver, conservator, liquidator, assignee,
trustee, sequestrator or similar official of the Borrower or any of its
Significant Subsidiaries of any substantial part of its Properties; or (ii) the
making by the Borrower or any of its Significant Subsidiaries of a general
assignment for the benefit of creditors; or (iii) the Borrower or any of its
Significant Subsidiaries shall take any action in furtherance of, or indicating
its consent to, approval of, or acquiescence in, any of the acts described in
clause (i) or (ii) above or in Section 9.1(g); or (iv) the admission by the
Borrower or any of its Significant Subsidiaries in writing of its inability to
pay its debts generally as they become due or the failure by the Borrower or any
of its Significant Subsidiaries generally to pay its debts as such debts become
due; or
47
(i) Enforcement Proceedings. A final judgment or decree for the payment of
money which, together with all other such judgments or decrees against the
Borrower or any of its Significant Subsidiaries then outstanding and
unsatisfied, exceeds $25,000,000 in aggregate amount shall be rendered against
the Borrower or any of its Significant Subsidiaries and the same shall remain
undischarged for a period of 60 days, during which the execution thereon shall
not effectively be stayed, released, bonded or vacated; or
(j) ERISA Events. (i) The Borrower or any Significant Subsidiary shall
incur any liability arising out of (A) any "prohibited transaction" (as defined
in Section 406 of ERISA or Section 4975 of the Code) involving any Plan, (B) the
occurrence of any "accumulated funding deficiency" (within the meaning of
Section 412 of the Code or Section 302 of ERISA) by a Plan, whether or not
waived, or any Lien in favor of the PBGC or a Plan on the assets of the Borrower
or any Commonly Controlled Entity, (C) the occurrence of a Reportable Event with
respect to, or the commencement of proceedings under Section 4042 of ERISA to
have a trustee appointed, or the appointment of a trustee under Section 4042 of
ERISA, to administer or to terminate any Single Employer Plan, which Reportable
Event, commencement of proceedings or appointment of a trustee is likely to
result in the termination of such Plan for purposes of Title IV of ERISA, (D)
the termination of any Single Employer Plan for purposes of Title IV of ERISA,
(E) withdrawal from, or the Insolvency or Reorganization of, a Multiemployer
Plan or (F) the occurrence of any other event or condition with respect to a
Plan, and any of such items (A) through (F) above results in or is likely to
result in a material liability or deficiency of the Borrower or any Significant
Subsidiary; provided, however, that for purposes of this Section 9.1(j), any
liability or deficiency of the Borrower or any Significant Subsidiary shall be
deemed not to be material so long as the sum of all liabilities or deficiencies
referred to in this Section 9.1(j) at any one time outstanding, individually and
in the aggregate, is less than $25,000,000, or (ii) the occurrence of any one or
more of the events specified in clauses (A) through (F) above if, individually
or in the aggregate, such event or events would have a Material Adverse Effect
on the Borrower; or
(k) Change in Control of the Borrower. A Change in Control shall have
occurred.
SECTION 9.2. Cancellation/Acceleration. If at any time and for any reason
(whether within or beyond the control of any party to this Agreement):
(a) either of the Events of Default specified in Section 9.1(g) or 9.1(h)
occurs with respect to the Borrower, then automatically, all Loans made
hereunder, all unpaid accrued interest or fees and any other sum payable under
this Agreement shall become immediately due and payable; or
(b) any other Event of Default specified in Section 9.1 occurs and, while
such Event of Default is continuing, the Administrative Agent, having been so
instructed by the Majority Banks, by notice to the Borrower, shall so declare
that either (i) all Loans made hereunder, all unpaid accrued interest or fees
and any other sum payable under this Agreement shall become immediately due and
payable or (ii) all Loans made hereunder, all unpaid accrued interest or fees
and any other sum payable under this Agreement shall become due and payable at
48
any time thereafter immediately on demand by the Administrative Agent (acting on
the instructions of the Majority Banks).
Except as expressly provided above in this Section 9.2, presentment, demand,
protest, notice of intent to accelerate, notice of acceleration and all other
notices of any kind whatsoever are hereby expressly waived by the Borrower.
ARTICLE X
THE ADMINISTRATIVE AGENT
SECTION 10.1. Appointment. Each Bank hereby irrevocably designates and
appoints Credit Suisse First Boston as the Administrative Agent of such Bank
under this Agreement and the other Loan Documents, and each such Bank
irrevocably authorizes Credit Suisse First Boston, as the Administrative Agent
for such Bank, to take such action on its behalf under the provisions of this
Agreement and the other Loan Documents and to exercise such powers and perform
such duties as are expressly delegated to the Administrative Agent by the terms
of this Agreement and the other Loan Documents, together with such other powers
as are reasonably incidental thereto. Notwithstanding any provision to the
contrary elsewhere in this Agreement, the Administrative Agent shall not have
any duties or responsibilities, except those expressly set forth herein, or any
fiduciary relationship with any Bank, and no implied covenants, functions,
responsibilities, duties, obligations or liabilities shall be read into this
Agreement or any other Loan Document or otherwise exist against the
Administrative Agent and (b) neither the Lead Arranger or any other Person
listed as a "Co-Arranger" on the cover page hereof shall have any duties or
responsibilities hereunder, or any fiduciary relationship with any bank, and no
implied covenants, functions, responsibilities, duties, obligations or
liabilities shall be read into this Agreement or any other Loan Document or
otherwise exist against the Lead Arranger or such other Person.
SECTION 10.2. Delegation of Duties. The Administrative Agent may execute
any of its duties under this Agreement and the other Loan Documents by or
through agents or attorneys-in-fact and shall be entitled to advice of counsel
concerning all matters pertaining to such duties. The Administrative Agent shall
not be responsible for the negligence or misconduct of any agents or
attorneys-in-fact selected by it with reasonable care.
SECTION 10.3. Exculpatory Provisions. Neither the Administrative Agent nor
any of its officers, directors, employees, agents, attorneys-in-fact or
Affiliates shall be (a) liable for any action lawfully taken or omitted to be
taken by it or such Person under or in connection with this Agreement or any
other Loan Document (except for its or such Person's own gross negligence or
willful misconduct) or (b) responsible in any manner to any of the Banks for any
recitals, statements, representations or warranties made by the Borrower or any
officer thereof contained in this Agreement or any other Loan Document or in any
certificate, report, statement or other document referred to or provided for in,
or received by the Administrative Agent under or in connection with, this
Agreement or any other Loan Document or for the value, validity, effectiveness,
genuineness, enforceability or sufficiency of this Agreement or any other Loan
Document or for any failure of the Borrower to perform its obligations hereunder
or thereunder. The Administrative Agent shall not be under any obligation to any
Bank to ascertain or to inquire
49
as to the observance or performance of any of the agreements contained in, or
conditions of, this Agreement or any other Loan Document, or to inspect the
properties, books or records of the Borrower.
SECTION 10.4. Reliance by Administrative Agent. The Administrative Agent
shall be entitled to rely, and shall be fully protected in relying, upon any
note, writing, resolution, notice, consent, certificate, affidavit, letter,
facsimile, telex or teletype message, statement, order or other document or
conversation believed by it to be genuine and correct and to have been signed,
sent or made by the proper Person or Persons and upon advice and statements of
legal counsel (including, without limitation, counsel to the Borrower),
independent accountants and other experts selected by the Administrative Agent.
The Administrative Agent may deem and treat the payee of any Note or any loan
account in the Register as the owner thereof for all purposes unless a written
notice of assignment, negotiation or transfer thereof shall have been filed with
the Administrative Agent. The Administrative Agent shall be fully justified in
failing or refusing to take any action under this Agreement or any other Loan
Document unless it shall first receive such advice or concurrence of the
Majority Banks as it deems appropriate or it shall first be indemnified to its
satisfaction by the Banks against any and all liability and expense that may be
incurred by it by reason of taking or continuing to take any such action. The
Administrative Agent shall in all cases be fully protected in acting, or in
refraining from acting, under this Agreement and the other Loan Documents in
accordance with a request of the Majority Banks, and such request and any action
taken or failure to act pursuant thereto shall be binding upon all the Banks and
all future holders of the amounts owing hereunder.
SECTION 10.5. Notice of Default. The Administrative Agent shall not be
deemed to have knowledge or notice of the occurrence of any Default or Event of
Default hereunder unless the Administrative Agent has received notice from a
Bank or the Borrower referring to this Agreement, describing such Default or
Event of Default and stating that such notice is a "notice of default". In the
event that the Administrative Agent receives such a notice, the Administrative
Agent shall give notice thereof to the Banks. The Administrative Agent shall
take such action with respect to such Default or Event of Default as shall be
reasonably directed by the Majority Banks; provided that unless and until the
Administrative Agent shall have received such directions, the Administrative
Agent may (but shall not be obligated to) take such action, or refrain from
taking such action, with respect to such Default or Event of Default as it shall
deem advisable in the best interests of the Banks.
SECTION 10.6. Non-Reliance on Administrative Agent and Other Banks. Each
Bank expressly acknowledges that neither the Administrative Agent nor any of its
officers, directors, employees, agents, attorneys-in-fact or Affiliates has made
any representations or warranties to it and that no act by the Administrative
Agent hereinafter taken, including any review of the affairs of the Borrower,
shall be deemed to constitute any representation or warranty by the
Administrative Agent to any Bank. Each Bank represents to the Administrative
Agent that it has, independently and without reliance upon the Administrative
Agent or any other Bank, and based on such documents and information as it has
deemed appropriate, made its own appraisal of and investigation into the
business, operations, property, financial and other condition and
creditworthiness of the Borrower and made its own decision to make its Loans
hereunder and enter into this Agreement. Each Bank also represents that it will,
independently and without reliance upon the Administrative Agent or any other
Bank, and based on such documents and
50
information as it shall deem appropriate at the time, continue to make its own
credit analysis, appraisals and decisions in taking or not taking action under
this Agreement and the other Loan Documents, and to make such investigation as
it deems necessary to inform itself as to the business, operations, property,
financial and other condition and creditworthiness of the Borrower. Except for
notices, reports and other documents expressly required to be furnished to the
Banks by the Administrative Agent hereunder, the Administrative Agent shall not
have any duty or responsibility to provide any Bank with any credit or other
information concerning the business, operations, property, condition (financial
or otherwise), prospects or creditworthiness of the Borrower that may come into
the possession of the Administrative Agent or any of its officers, directors,
employees, Administrative Agents, attorneys-in-fact or Affiliates.
SECTION 10.7. Indemnification. The Banks agree to indemnify the
Administrative Agent and Lead Arranger in their respective capacities as such
(to the extent not reimbursed by the Borrower and without limiting the
obligation of the Borrower to do so), ratably according to their respective
applicable Pro Rata Percentages in effect on the date on which indemnification
is sought under this Section 10.7, from and against any and all liabilities,
obligations, losses, damages, penalties, actions, judgments, suits, costs,
expenses or disbursements of any kind whatsoever that may at any time
(including, without limitation, at any time following the payment of all amounts
owing hereunder) be imposed on, incurred by or asserted against the
Administrative Agent or the Lead Arranger, as the case may be, in any way
relating to or arising out of this Agreement, any of the other Loan Documents or
any documents contemplated by or referred to herein or therein or the
transactions contemplated hereby or thereby or any action taken or omitted by
the Administrative Agent or the Lead Arranger, as the case may be, under or in
connection with any of the foregoing; provided that no Bank shall be liable for
the payment of any portion of such liabilities, obligations, losses, damages,
penalties, actions, judgments, suits, costs, expenses or disbursements to the
extent they are found by a final judgment of a court of competent jurisdiction
to have resulted primarily from the Administrative Agent's or the Lead
Arranger's, as the case may be, gross negligence or willful misconduct. The
agreements in this Section 10.7 shall survive the payment of all amounts payable
hereunder.
SECTION 10.8. Administrative Agent in Its Individual Capacity. The
Administrative Agent and its Affiliates may make loans to, accept deposits from
and generally engage in any kind of business with the Borrower as though the
Administrative Agent were not the Administrative Agent hereunder and under the
other Loan Documents. With respect to its Loans made or renewed by it, the
Administrative Agent shall have the same rights and powers under this Agreement
and the other Loan Documents as any Bank and may exercise the same as though it
were not the Administrative Agent, and the terms "Bank" and "Banks" shall
include the Administrative Agent in its individual capacity.
SECTION 10.9. Successor Administrative Agent. The Administrative Agent may
resign as Administrative Agent upon 30 days' notice to the Banks and the
Borrower. If the Administrative Agent shall resign as Administrative Agent under
this Agreement and the other Loan Documents, then the Majority Banks shall
appoint from among the Banks a successor agent for the Banks, which successor
agent shall be approved by the Borrower, whereupon such successor agent shall
succeed to the rights, powers and duties of the Administrative Agent, and the
term "Administrative Agent" shall mean such successor agent effective upon such
appointment and approval, and the former Administrative Agent's rights, powers
and duties as
51
Administrative Agent shall be terminated, without any other or further act or
deed on the part of such former Agent or any of the parties to this Agreement or
any holders of any amounts payable hereunder; provided that if an Event of
Default has occurred and is continuing, no consent of the Borrower shall be
required. If a successor Administrative Agent shall not have been so appointed
within said 30-day period, the Administrative Agent may then appoint a successor
Administrative Agent who shall be a financial institution engaged or licensed to
conduct banking business under the laws of the United States with an office in
New York City and that has total assets in excess of $500,000,000 and who shall
serve as Administrative Agent until such time, if any, as an Administrative
Agent shall have been appointed as provided above. After any retiring
Administrative Agent's resignation or removal as Administrative Agent, the
provisions of this Article X shall inure to its benefit as to any actions taken
or omitted to be taken by it while it was Administrative Agent under this
Agreement and the other Loan Documents.
SECTION 10.10 Notwithstanding anything to the contrary contained herein, no
Bank identified as an "Agent" or "Arranger" other than the Administrative Agent,
shall have the right, power, obligation, liability, responsibility or duty under
this Agreement or any Loan Document other than those applicable to all Banks as
such. Without limiting the foregoing, none of the Banks so identified shall have
or be deemed to have any fiduciary relationship with any Bank. Each Bank
acknowledges that it has not relied, and will not rely, on any of the Banks so
identified in deciding to enter into this Agreement or not taking action
hereunder.
ARTICLE XI
MISCELLANEOUS
SECTION 11.1. Amendments and Waivers. Neither this Agreement, any Note, any
other Loan Document, nor any terms hereof or thereof may be amended,
supplemented or modified except pursuant to an instrument or instruments in
writing executed in accordance with the provisions of this Section 11.1. The
Majority Banks may, or, with the written consent of the Majority Banks, the
Administrative Agent may, from time to time, (a) enter into with the Borrower
written amendments, supplements or modifications hereto and to any Notes and the
other Loan Documents for the purpose of adding any provisions to this Agreement
or any Notes or the other Loan Documents or changing in any manner the rights of
the Banks or of the Borrower hereunder or thereunder or (b) waive, on such terms
and conditions as the Majority Banks or the Administrative Agent, as the case
may be, may specify in such instrument, any of the requirements of this
Agreement or any Notes or the other Loan Documents or any Default or Event of
Default and its consequences; provided, however, that no such waiver and no such
amendment, supplement or modification shall:
(i) reduce the amount or extend the scheduled date of maturity of any
Note or Loan, or reduce the stated rate of any interest or fee payable
hereunder or extend the scheduled date of any payment thereof or increase
the amount or extend the expiration date of any Bank's Commitments, in each
case without the consent of each Bank affected thereby;
(ii) amend, modify or waive any provision of this Section or of
Section 5.2 in a manner that would alter the pro rata sharing of payments
required thereby or in a
52
manner that would eliminate or limit a Bank's right to reject prepayments
under Section 5.5 or 5.6 or reduce the percentage specified in the
definition of Majority Banks or Supermajority Banks, or consent to the
assignment or transfer by the Borrower of any of its respective rights and
obligations under this Agreement and the other Loan Documents, or release
any material portion of the Collateral, in each case without the written
consent of all the Banks;
(iii) amend, modify or waive any provision of Section 5.6 or amend,
modify or waive any provision of Section 8.2(c) to permit a merger
involving the Borrower not otherwise permitted in such Section, in each
case without the consent of the Supermajority Banks; or
(iv) amend, modify or waive any provision of Article X without the
written consent of then Administrative Agent.
Any such waiver and any such amendment, supplement or modification shall
apply equally to each of the Banks and shall be binding upon the Borrower, the
Banks, the Administrative Agent and all future holders of the amounts payable
hereunder. In the case of any waiver, the Borrower, the Banks and the
Administrative Agent shall be restored to their former position and rights
hereunder and under any outstanding Notes and any other Loan Documents, and any
Default or Event of Default waived shall be deemed to be cured and not
continuing, but no such waiver shall extend to any subsequent or other Default
or Event of Default, or impair any right consequent thereon.
SECTION 11.2. Notices. Unless otherwise expressly provided herein, all
notices, requests and demands to or upon the respective parties hereto to be
effective shall be in writing (including by facsimile followed by any original
sent by mail or delivery), and, shall be deemed to have been duly given or made
when delivered by hand, or three days after being deposited in the mail, postage
prepaid, or, in the case of telecopy notice, when received, addressed as follows
in the case of the Borrower and the Administrative Agent, and as set forth in
Schedule 1.1 in the case of the other parties hereto, or to such other address
as may be hereafter notified by the respective parties hereto and any future
holders of the amounts payable hereunder:
Borrower: 0000 Xxxxxxxxx
Xxxxxxx, Xxxxx 00000
Attention: Xxxxx Xxxxxx
Assistant Treasurer
Telecopy: (000) 000-0000
With a copy to: Xxxx Xxxxxxxx
Treasurer
Telecopy: (000) 000-0000
53
The Administrative
Agent: Credit Suisse First Xxxxxx
Xxxxxx Xxxxxxx Xxxxxx
Xxx Xxxx, Xxx Xxxx 00000
Attention: Xxxxx Xxxxxxxxx
Telecopy: (000) 000-0000
provided that any notice, request or demand to or upon the Administrative Agent
or the Banks shall not be effective until received.
SECTION 11.3. No Waiver; Cumulative Remedies. No failure to exercise and no
delay in exercising, on the part of the Administrative Agent or any Bank, any
right, remedy, power or privilege hereunder shall operate as a waiver thereof;
nor shall any single or partial exercise of any right, remedy, power or
privilege hereunder preclude any other or further exercise thereof or the
exercise of any other right, remedy, power or privilege. The rights, remedies,
powers and privileges herein provided are cumulative and not exclusive of any
rights, remedies, powers and privileges provided by law.
SECTION 11.4. Survival of Representations and Warranties. All
representations and warranties made hereunder and in any document, certificate
or statement delivered pursuant hereto or in connection herewith shall survive
the execution and delivery of this Agreement.
SECTION 11.5. Payment of Expenses and Taxes; Indemnity. The Borrower agrees
(a) to pay or reimburse (i) the Administrative Agent and its Affiliates for all
their reasonable out-of-pocket costs and expenses incurred in connection with
the development, preparation, negotiation and execution of, and any amendment,
supplement or modification to, this Agreement and any Notes and the other Loan
Documents and any other documents prepared in connection herewith or therewith,
and the consummation and administration of the transactions contemplated hereby
and thereby, including, without limitation, the reasonable fees and
disbursements of special counsel to the Administrative Agent and (ii) the Banks
for the reasonable fees and disbursements of special counsel to the Banks in
connection with the same, (b) to pay or reimburse each Bank and the
Administrative Agent for all its costs and expenses incurred in connection with
the enforcement or preservation of any rights under this Agreement, any Notes,
the other Loan Documents and any such other documents, including, without
limitation, the reasonable fees and disbursements of the several special counsel
to the Banks and the Administrative Agent, (c) without duplication of any other
provision contained in this Agreement or any Notes, to pay, indemnify, and hold
each Bank and the Administrative Agent harmless from, any and all recording and
filing fees, if any, and any and all liabilities (for which each Bank has not
been otherwise reimbursed under this Agreement) with respect to, or resulting
from any delay in paying, stamp, excise and other taxes, if any, that may be
payable or determined to be payable in connection with the execution and
delivery of, or consummation or administration of any of the transactions
contemplated by, or any amendment, supplement or modification of, or any waiver
or consent under or in respect of, this Agreement, any Notes, the other Loan
Documents and any such other documents, and (d) without duplication of any other
provision contained in this Agreement or any Notes, to pay, indemnify, and hold
each Bank and the Administrative Agent together with their respective directors,
officers, employees, agents and
54
affiliates (collectively, "Indemnified Persons") harmless from and against, any
and all other liabilities, obligations, losses, damages, penalties, actions,
judgments, suits, costs, expenses or disbursements of any kind or nature
whatsoever with respect to the execution, delivery, enforcement, performance and
administration of this Agreement, any Notes, the other Loan Documents or the
use, or proposed use, of proceeds of the Loans and any such other documents (all
the foregoing in this clause (d), collectively, the "Indemnified Liabilities");
provided that the Borrower shall have no obligation hereunder to an Indemnified
Person with respect to Indemnified Liabilities to the extent they are found in a
final judgment of a court of competent jurisdiction to have resulted primarily
from the gross negligence or willful misconduct of such Indemnified Person, AND
PROVIDED FURTHER THAT IT IS THE INTENTION OF THE BORROWER TO INDEMNIFY THE
INDEMNIFIED PERSONS AGAINST THE CONSEQUENCES OF THEIR OWN NEGLIGENCE. The
agreements in this Section 11.5 shall survive repayment of the Loans and all
other amounts payable hereunder.
SECTION 11.6. Effectiveness; Successors and Assigns; Participations;
Assignments. (a) This Agreement shall become effective on the Closing Date and
thereafter shall be binding upon and inure to the benefit of the Borrower, the
Banks, the Administrative Agent, all future holders of the Loans and their
respective successors and assigns, except that the Borrower may not assign or
transfer any of its rights or obligations under this Agreement without the prior
written consent of each Bank.
(b) Any Bank may, in the ordinary course of its commercial banking business
and in accordance with applicable law, at any time sell to one or more banks or
other financial institutions or Bank Affiliates (a "Participant") participating
interests in any Loan owing to such Bank, any Note held by such Bank, any
Commitment of such Bank or any other interest of such Bank hereunder and under
the other Loan Documents. In the event of any such sale by a Bank of a
participating interest to a Participant, such Bank's obligations under this
Agreement to the other parties to this Agreement shall remain unchanged, such
Bank shall remain solely responsible for the performance thereof, such Bank
shall remain the holder of any such Loan and Commitment or other interest for
all purposes under this Agreement and the other Loan Documents, the Borrower and
the Administrative Agent shall continue to deal solely and directly with such
Bank in connection with such Bank's rights and obligations under this Agreement
and the other Loan Documents and except with respect to the matters set forth in
Section 11.1, the amendment of which requires the consent of all of the Banks,
the participation agreement between the selling Bank and the Participant may not
restrict such Bank's voting rights hereunder. The Borrower agrees that each
Participant, to the extent provided in its participation, shall be entitled to
the benefits of Sections 4.4, 4.7, 5.1 and 5.3 with respect to its participation
in the Commitments and the Loans outstanding from time to time; provided that no
Participant shall be entitled to receive any greater amount pursuant to such
Sections than the selling Bank would have been entitled to receive in respect of
the amount of the participation sold by such selling Bank to such Participant
had no such sale occurred. Except as expressly provided in this Section 11.6(b),
no Participant shall be a third-party beneficiary of or have any rights under
this Agreement or under any of the other Loan Documents.
(c) Any Bank may, in the ordinary course of its commercial banking business
and in accordance with applicable law, at any time sell to one or more
additional banks ("Purchasing Banks") all or any part of its rights and
obligations under this Agreement pursuant
55
to an Assignment and Acceptance, substantially in the form of Exhibit 11.6(c)
("Assignment and Acceptance"), executed by such Purchasing Bank and such
transferor Bank (and, in the case of a Purchasing Bank that is not a Bank
Affiliate, by the Administrative Agent) and delivered to the Administrative
Agent for its acceptance and recording in the Register; provided that each such
sale hereunder shall be in an aggregate amount of not less than $1,000,000. Upon
such execution, delivery, acceptance and recording, from and after the Closing
Date determined pursuant to such Assignment and Acceptance (the "Transfer
Effective Date"), (i) the Purchasing Bank thereunder shall be a party hereto
and, to the extent provided in such Assignment and Acceptance, have the rights
and obligations of a Bank hereunder with the Commitments as set forth therein
and (ii) the transferor Bank thereunder shall, to the extent provided in such
Assignment and Acceptance, be released from its obligations under this Agreement
(and, in the case of an Assignment and Acceptance covering all or the remaining
portion of a transferor Bank's rights and obligations under this Agreement, such
transferor Bank shall cease to be a party hereto). Such Assignment and
Acceptance shall be deemed to amend this Agreement to the extent, and only to
the extent, necessary to reflect the addition of such Purchasing Bank and the
resulting adjustment of Pro Rata Percentages arising from the purchase by such
Purchasing Bank of all or a portion of the rights and obligations of such
transferor Bank under this Agreement. On or prior to the Transfer Effective Date
determined pursuant to such Assignment and Acceptance, (i) appropriate entries
shall be made in the accounts of the transferor Bank and the Register evidencing
such assignment and releasing the Borrower from any and all obligations to the
transferor Bank in respect of the assigned Loan or Loans and (ii) appropriate
entries evidencing the assigned Loan or Loans shall be made in the accounts of
the Purchasing Bank and the Register as required by Section 4.1 hereof. In the
event that any Notes have been issued in respect of the assigned Loan or Loans,
such Notes shall be marked "cancelled" and surrendered by the transferor Bank to
the Administrative Agent for return to the Borrower.
(d) The Administrative Agent shall maintain at its address referred to in
Section 11.2 a copy of each Assignment and Acceptance delivered to it and a
register (the "Register") for the recordation of the names and addresses of the
Banks and the Commitments of, and principal amount of the Loans owing to, each
Bank from time to time. To the extent permitted by applicable law, the entries
in the Register shall be conclusive, in the absence of manifest error, and the
Borrower, the Administrative Agent and the Banks may (and, in the case of any
Loan or other obligations hereunder not evidenced by a Note, shall) treat each
Person whose name is recorded in the Register as the owner of a Loan or other
obligation hereunder as the owner thereof for all purposes of this Agreement and
the other Loan Documents, notwithstanding any notice to the contrary. Any
assignment of any Loan or other obligation hereunder not evidenced by a Note
shall be effective only upon appropriate entries with respect thereto being made
in the Register. The Register shall be available for inspection by the Borrower
or any Bank at any reasonable time and from time to time upon reasonable prior
notice.
(e) Upon its receipt of an Assignment and Acceptance executed by a
transferor Bank and Purchasing Bank (and, in the case of a Purchasing Bank that
is not then a Bank Affiliate, by the Administrative Agent) together with payment
to the Administrative Agent of a registration and processing fee of (i) $3,000
with respect to (and payable by) any Purchasing Bank that is not already a Bank
or a Bank Affiliate and (ii) $1,000 with respect to any Purchasing Bank that is
already a Bank or a Bank Affiliate, the Administrative Agent shall promptly
accept such Assignment and Acceptance on the Transfer Effective Date determined
56
pursuant thereto, record the information contained therein in the Register and
give notice of such acceptance and recordation to the Borrower.
(f) Each of the Banks and the Administrative Agent agrees to exercise its
best efforts to keep, and to cause any third party recipient of the information
described in this Section 11.6(f) to keep, any information delivered or made
available by the Borrower to it (including any information obtained pursuant to
Section 8.1), confidential from anyone other than Persons employed or retained
by such party who are or are expected to become engaged in evaluating,
approving, structuring or administering the transactions contemplated hereunder;
provided that nothing herein shall prevent any Bank or the Administrative Agent
from disclosing such information (i) to any other Bank or any Affiliate of any
Bank, (ii) pursuant to subpoena or upon the order of any court or administrative
agency, (iii) upon the request or demand of any Governmental Authority having
jurisdiction over such Bank, (iv) if such information has been publicly
disclosed, (v) to the extent reasonably required in connection with any
litigation to which either the Administrative Agent, any Bank, the Borrower or
their respective Affiliates may be a party, (vi) to the extent reasonably
required in connection with the exercise of any remedy hereunder, (vii) to the
Administrative Agent's or such Bank's, as the case may be, legal counsel,
independent auditors and other professional advisors and (viii) to any actual or
proposed Participant or Purchasing Bank (each, a "Transferee") that has agreed
in writing to be bound by the provisions of this Section 11.6(f). Unless
prohibited from doing so by applicable law, in the event that any Bank or the
Administrative Agent is legally requested or required to disclose any
confidential information pursuant to clause (ii), (iii), or (v) of this Section
11.6(f), such party shall promptly notify the Borrower of such request or
requirement prior to disclosure so that Borrower may seek an appropriate
protective order and/or waive compliance with the terms of this Agreement. If,
however, in the opinion of counsel for such party, such party is nonetheless, in
the absence of such order or waiver, compelled to disclose such confidential
information or otherwise stand liable for contempt or suffer possible censure or
other penalty or liability, then such party may disclose such confidential
information without liability to the Borrower; provided, however, that such
party will use its best efforts to minimize the disclosure of such information.
Subject to the exceptions above to disclosure of information, each of the Banks
and the Administrative Agent agrees that it shall not publish, publicize, or
otherwise make public any information regarding this Agreement or the
transactions contemplated hereby without the written consent of the Borrower, in
its sole discretion.
(g) If, pursuant to this Section, any interest in this Agreement or any
Loan is transferred to any Transferee that is organized under the laws of any
jurisdiction other than the United States or any state thereof, the transferor
Bank shall cause such Transferee, concurrently with the effectiveness of such
transfer, (i) to deliver to the transferor Bank (and, in the case of any
Purchasing Bank registered in the Register, the Administrative Agent and the
Borrower) either U.S. Internal Revenue Service Form W-8BEN or U.S. Internal
Revenue Service Form W-8ECI, or successor applicable forms (wherein such
Transferee claims entitlement to complete exemption from U.S. federal
withholding tax on all interest payments hereunder) and (ii) to agree (for the
benefit of the transferor Bank, the Administrative Agent and the Borrower) to
deliver to the transferor Bank (and, in the case of any Purchasing Bank
registered in the Register, the Administrative Agent and the Borrower) a new
duly executed and completed Form W-8BEN or Form W-8ECI, or successor applicable
forms or other manner of certification, as the case may be, upon the expiration
or obsolescence of any previously delivered form in accordance with
57
applicable U.S. laws and regulations and amendments, unless in any such case any
change in treaty, law or regulation has occurred prior to the date on which any
such delivery would otherwise be required that renders all such forms
inapplicable or that would prevent such Transferee from duly completing and
delivering any such form with respect to it and such Transferee so advises the
transferor Bank (and, in the case of any Purchasing Bank registered in the
Register, the Administrative Agent and the Borrower).
(h) Nothing herein shall prohibit any Bank from pledging or assigning all
or any portion of its Loans to any Federal Reserve Bank in accordance with
applicable law. In order to facilitate such pledge or assignment, the Borrower
hereby agrees that, upon request of any Bank at any time and from time to time
after the Borrower has made its initial borrowing hereunder, the Borrower shall
provide to such Bank, at the Borrower's own expense, a promissory note,
substantially in the form of Exhibit 11.6(h) evidencing the Loans owing to such
Bank.
SECTION 11.7. Setoff. In addition to any rights and remedies of the Banks
provided by law, each Bank shall have the right, without prior notice to the
Borrower, any such notice being expressly waived by the Borrower to the extent
permitted by applicable law, upon any amount becoming due and payable by the
Borrower hereunder or under the Loans to which it is a party (whether at the
stated maturity, by acceleration or otherwise) to setoff and appropriate and
apply against such amount any and all deposits (general or special, time or
demand, provisional or final), in any currency, and any other credits,
indebtedness or claims, in any currency, in each case whether direct or
indirect, absolute or contingent, matured or unmatured, at any time held or
owing by such Bank or any branch or agency thereof to or for the credit or the
account of the Borrower. Each Bank agrees promptly to notify the Borrower and
the Administrative Agent after any such setoff and application made by such
Bank, provided that the failure to give such notice shall not affect the
validity of such setoff and application.
SECTION 11.8. Counterparts. This Agreement may be executed by one or more
of the parties to this Agreement on any number of separate counterparts, and all
of said counterparts taken together shall be deemed to constitute one and the
same instrument. A set of the copies of this Agreement signed by all the parties
shall be maintained with the Borrower and the Administrative Agent.
SECTION 11.9. Severability. Any provision of this Agreement that is
prohibited or unenforceable in any jurisdiction shall, as to such jurisdiction,
be ineffective to the extent of such prohibition or unenforceability without
invalidating the remaining provisions hereof, and any such prohibition or
unenforceability in any jurisdiction shall not invalidate or render
unenforceable such provision in any other jurisdiction.
SECTION 11.10. Integration. This Agreement and the other Loan Documents
represent the agreement of the Borrower, the Administrative Agent and the Banks
with respect to the subject matter hereof, and there are no promises,
undertakings, representations or warranties by the Administrative Agent or any
Bank relative to the subject matter hereof not expressly set forth or referred
to herein or in the other Loan Documents.
SECTION 11.11. GOVERNING LAW. (a) THIS AGREEMENT AND ANY NOTES OR OTHER
LOAN DOCUMENTS AND THE RIGHTS AND OBLIGATIONS
58
OF THE PARTIES UNDER THIS AGREEMENT AND ANY NOTES AND ANY OTHER LOAN DOCUMENTS
SHALL BE GOVERNED BY, AND CONSTRUED AND INTERPRETED IN ACCORDANCE WITH THE LAW
OF THE STATE OF NEW YORK.
(b) Notwithstanding anything in Section 11.11(a) to the contrary, nothing
in this Agreement or in any Note or any other Loan Documents shall be deemed to
constitute a waiver of any rights which any Bank may have under applicable
federal law relating to the amount of interest which any Bank may contract for,
take, receive or charge in respect of any Loans, including any right to take,
receive, reserve and charge interest at the rate allowed by the laws of the
state where such Bank is located. To the extent that Texas law is applicable to
the determination of the Highest Lawful Rate, the Banks and the Borrower agree
that (i) if Chapter 303 of the Texas Finance Code, as amended, is applicable to
such determination, the weekly rate ceiling (formerly known as the indicated
(weekly) rate ceiling in Article 1.04, Subtitle 1, Title 79, of the Revised
Civil Statutes of Texas, as amended, as computed from time to time shall apply,
provided that, to the extent permitted by such Article, the Administrative Agent
may from time to time by notice to the Borrower revise the election of such
interest rate ceiling as such ceiling affects then current or future balances of
the Loans; and (ii) the provisions of Chapter 346 of the Texas Finance Code, as
amended (formerly found in Chapter 15 of Subtitle 3, Title 79, of the Revised
Civil Statutes of Texas, 1925, as amended, shall not apply to this Agreement or
any Note issued hereunder.
SECTION 11.12. Submission to Jurisdiction; Waivers. The Borrower hereby
irrevocably and unconditionally:
(a) submits for itself and its property in any legal action or proceeding
relating to this Agreement and the other Loan Documents to which it is a party,
or for recognition and enforcement of any judgment in respect thereof, to the
non-exclusive general jurisdiction of the Courts of the State of New York, the
courts of the United States of America for the Southern District of New York,
and appellate courts from any thereof;
(b) consents that any such action or proceeding may be brought in such
courts and waives any objection that it may now or hereafter have to the venue
of any such action or proceeding in any such court or that such action or
proceeding was brought in an inconvenient court and agrees not to plead or claim
the same;
(c) agrees that service of process in any such action or proceeding may be
effected by mailing a copy thereof by registered or certified mail (or any
substantially similar form of mail), postage prepaid, to the Borrower at its
address set forth in Section 11.2 or at such other address of which the
Administrative Agent shall have been notified pursuant thereto;
(d) agrees that nothing herein shall affect the right to effect service of
process in any other manner permitted by law or shall limit the right to xxx in
any other jurisdiction; and
(e) waives, to the maximum extent permitted by applicable law, any right it
may have to claim or recover in any legal action or proceeding referred to in
this Section 11.12 any special, exemplary, punitive or consequential damages.
59
SECTION 11.13. Acknowledgments. The Borrower hereby acknowledges that:
(a) it has been advised by counsel in the negotiation, execution and
delivery of this Agreement, any Notes and the other Loan Documents;
(b) neither the Administrative Agent nor any Bank has any fiduciary
relationship with or duty to the Borrower arising out of or in connection with
this Agreement or any of the other Loan Documents, and the relationship between
the Administrative Agent and the Banks, on one hand, and the Borrower, on the
other hand, in connection herewith or therewith is solely that of debtor and
creditor; and
(c) no joint venture exists among the Banks or among the Borrower and the
Banks.
SECTION 11.14. Limitation on Agreements. All agreements between the
Borrower, the Administrative Agent or any Bank, whether now existing or
hereafter arising and whether written or oral, are hereby expressly limited so
that in no contingency or event whatsoever, whether by reason of demand being
made in respect of an amount due under any Loan Document or otherwise, shall the
amount paid, or agreed to be paid, to the Administrative Agent or any Bank for
the use, forbearance, or detention of the money to be loaned under this
Agreement, any Notes or any other Loan Document or otherwise or for the payment
or performance of any covenant or obligation contained herein or in any other
Loan Document exceed the Highest Lawful Rate. If, as a result of any
circumstances whatsoever, fulfillment of any provision hereof or of any of such
documents, at the time performance of such provision shall be due, shall involve
transcending the limit of validity prescribed by applicable usury law, then,
ipso facto, the obligation to be fulfilled shall be reduced to the limit of such
validity, and if, from any such circumstance, the Administrative Agent or any
Bank shall ever receive interest or anything that might be deemed interest under
applicable law that would exceed the Highest Lawful Rate, such amount that would
be excessive interest shall be applied to the reduction of the principal amount
owing on account of such Bank's Loans or the amounts owing on other obligations
of the Borrower to the Administrative Agent or any Bank under any Loan Document
and not to the payment of interest, or if such excessive interest exceeds the
unpaid principal balance of such Bank's Loans and the amounts owing on other
obligations of the Borrower to the Administrative Agent or any Bank under any
Loan Document, as the case may be, such excess shall be refunded to the
Borrower. All sums paid or agreed to be paid to the Administrative Agent or any
Bank for the use, forbearance or detention of the indebtedness of the Borrower
to the Administrative Agent or any Bank shall, to the fullest extent permitted
by applicable law, be amortized, prorated, allocated and spread throughout the
full term of such indebtedness until payment in full of the principal (including
the period of any renewal or extension thereof) so that the interest on account
of such indebtedness shall not exceed the Highest Lawful Rate. Notwithstanding
anything to the contrary contained in any Loan Document, it is understood and
agreed that if at any time the rate of interest that accrues on the outstanding
principal balance of any Loan shall exceed the Highest Lawful Rate, the rate of
interest that accrues on the outstanding principal balance of any Loan shall be
limited to the Highest Lawful Rate, but any subsequent reductions in the rate of
interest that accrues on the outstanding principal balance of any Loan shall not
reduce the rate of interest that accrues on the outstanding principal balance of
any Loan below the Highest Lawful Rate until the total amount of interest
accrued on the outstanding principal
60
balance of any Loan equals the amount of interest that would have accrued if
such interest rate had at all times been in effect. The terms and provisions of
this Section 11.14 shall control and supersede every other provision of all Loan
Documents.
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IN WITNESS WHEREOF, the parties hereto have caused this Agreement to be
executed by their respective officers or Administrative Agents thereunto duly
authorized, as of the date first above written.
CENTERPOINT ENERGY HOUSTON ELECTRIC, LLC,
By: /s/ XXXX XXXXXXXX
--------------------------------------------
Name: Xxxx Xxxxxxxx
Title: Vice President and Treasurer
Signature page to CenterPoint Energy Houston
Electric, LLC $1,310,000,000 credit agreement,
dated as of November 12, 2002,
CREDIT SUISSE FIRST BOSTON, acting
through its Cayman Islands Branch,
as Administrative Agent, and as a Bank,
By: /s/ XXXXX X. XXXXX
--------------------------------------------
Name: Xxxxx X. Xxxxx
Title: Director
By: /s/ XXXXXXX XXXXX
--------------------------------------------
Name: Xxxxxxx Xxxxx
Title: Associate
Signature page to CenterPoint Energy Houston
Electric, LLC $1,310,000,000 credit agreement,
dated as of November 12, 2002,
GOVERNMENT EMPLOYEES INSURANCE COMPANY,
as a Bank,
By: /s/ XXXXXX X. XXXXX
--------------------------------------------
Name: Xxxxxx X. Xxxxx
Title: Senior Vice President, Controller and
Chief Financial Officer
Signature page to CenterPoint Energy Houston
Electric, LLC $1,310,000,000 credit agreement,
dated as of November 12, 2002,
GENERAL RE CORPORATION,
as a Bank
By: /s/ XXXXXXXXX X. XXXXXX
--------------------------------------------
Name: Xxxxxxxxx X. Xxxxxx
Title: Senior Vice President, Treasurer and
Chief Financial Officer
