Exhibit 99.1
Execution Version
CREDIT AGREEMENT
Dated as of May 22, 2006
Among
ALLEGHENY ENERGY, INC.,
and
ALLEGHENY ENERGY SUPPLY COMPANY, LLC,
as Borrowers
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and
THE INITIAL LENDERS AND INITIAL ISSUING BANK NAMED HEREIN,
as Initial Lenders and Initial Issuing Bank
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and
CITICORP NORTH AMERICA, INC.,
as Administrative Agent
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CITIGROUP GLOBAL MARKETS INC., CREDIT SUISSE, CAYMAN ISLANDS BRANCH,
as Joint Lead Arranger and Joint Book as Joint Lead Arranger, Joint Book
Runner Runner and
Syndication Agent
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T A B L E O F C O N T E N T S
Section Page
ARTICLE I
DEFINITIONS AND ACCOUNTING TERMS
SECTION 1.01. Certain Defined Terms.........................................2
SECTION 1.02. Principles of Interpretation.................................36
SECTION 1.03. Letter of Credit.............................................37
SECTION 1.04. Joint and Several Obligations of AYE.........................37
ARTICLE II
AMOUNTS AND TERMS OF THE ADVANCES
AND LETTERS OF CREDIT
SECTION 2.01. The Advances.................................................38
(a) Revolving Advance........................................38
(b) Term Advance.............................................38
(c) Continuance of the Existing L/Cs.........................38
(d) AYE Letters of Credit....................................39
(e) AESC Indirect Letters of Credit..........................39
(f) AESC Direct Letters of Credit............................40
(g) Letters of Credit Generally..............................40
SECTION 2.02. Making the Advances..........................................41
SECTION 2.03. Issuance of Letters of Credit; Drawings and Reimbursements;
Auto-Extension Letters of Credit; Funding of Participations..43
(a) Procedures for Issuance and Amendment of Letters of
Credit; Auto-Extension Letters of Credit.................43
(b) Drawings and Reimbursements; Funding of Participations...44
(c) Repayment of Participations..............................46
(d) Role of Issuing Bank.....................................46
(e) Cash Collateral..........................................47
(f) Applicability of ISP and UCP.............................47
(g) Conflict with Issuer Documents...........................47
(h) Letters of Credit Issued for Subsidiaries................48
(i) Letter of Credit Reports.................................48
(j) Obligations Absolute.....................................48
(k) Acts and Omissions of Beneficiaries......................49
SECTION 2.04. Repayment of Advances........................................49
SECTION 2.05. Termination or Reduction of the Commitments..................49
(a) Optional.................................................49
(b) Mandatory................................................50
SECTION 2.06. Prepayments..................................................50
(a) Optional.................................................50
(b) Mandatory................................................50
(c) Other Amounts............................................51
SECTION 2.07. Interest.....................................................52
(a) Scheduled Interest.......................................52
(b) Default Interest.........................................52
(c) Notice of Interest Period and Interest Rate..............52
SECTION 2.08. Fees.........................................................52
(a) Commitment Fee...........................................52
(b) Letter of Credit Fees....................................53
(c) Fronting Fee and Documentary and Processing Charges
Payable to Issuing Bank, Etc.............................53
(d) Agent Fees...............................................53
SECTION 2.09. Illegality...................................................53
SECTION 2.10. Interest Elections...........................................54
(a) Optional.................................................54
(b) Mandatory................................................55
SECTION 2.11. Increased Costs, Etc.........................................55
SECTION 2.12. Payments and Computations....................................56
SECTION 2.13. Taxes........................................................58
SECTION 2.14. Evidence of Debt.............................................61
SECTION 2.15. Use of Proceeds..............................................62
ARTICLE III
CONDITIONS TO BORROWING
SECTION 3.01. Conditions Precedent to the Initial Borrowing
and the Term Advances.........................................62
SECTION 3.02. Conditions Precedent to Each Borrowing and L/C Credit
Extension.....................................................65
SECTION 3.03. Determinations Under Sections 3.01 and 3.02...................65
ARTICLE IV
REPRESENTATIONS AND WARRANTIES
SECTION 4.01. Representations and Warranties of the Borrowers...............66
ARTICLE V
COVENANTS OF THE BORROWER
SECTION 5.01. Affirmative Covenants of the Borrowers........................70
(a) Compliance with Laws......................................70
(b) Compliance with Environmental Laws........................70
(c) Governmental Approvals....................................70
(d) Payment of Taxes, Etc.....................................70
(e) Insurance.................................................71
(f) Preservation of Corporate Existence, Etc..................71
(g) Visitation Rights.........................................71
(h) Keeping of Books..........................................71
(i) Maintenance of Properties, Etc............................71
(j) Transactions with Affiliates..............................71
(k) Preparation of Environmental Reports......................72
(l) Maintenance of Ownership of Subsidiaries..................73
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(m) Use of Proceeds...........................................73
SECTION 5.02. Negative Covenants of AYE.....................................73
(a) Liens, Etc................................................73
(b) Debt......................................................75
(c) Change in Nature of Business..............................78
(d) Mergers, Etc..............................................78
(e) Sales, Etc., of Assets....................................79
(f) Investments in Other Persons..............................81
(g) Restricted Payments.......................................84
(h) Payment Restrictions Affecting AYE and its Subsidiaries...84
(i) Sale-Leaseback Transactions...............................86
(j) Accounting Changes........................................86
(k) Prepayments, Etc., of Debt................................86
(l) Speculative Transactions..................................86
(m) Compliance with ERISA.....................................86
SECTION 5.03. Reporting Covenants of AYE....................................86
(a) Default Notices...........................................87
(b) Annual Financials.........................................87
(c) Quarterly Financials......................................87
(d) Budget....................................................88
(e) Litigation................................................88
(f) [Intentionally Omitted]...................................88
(g) Environmental Conditions..................................88
(h) Other Information.........................................88
SECTION 5.04. Financial Covenants...........................................89
(a) Interest Coverage Ratio...................................89
(b) Leverage Ratio............................................89
ARTICLE VI
EVENTS OF DEFAULT
SECTION 6.01. Events of Default.............................................89
SECTION 6.02. Actions in Respect of Letters of Credit upon Default..........92
ARTICLE VII
THE ADMINISTRATIVE AGENT
SECTION 7.01. Authorization and Action......................................92
SECTION 7.02. Administrative Agent's Reliance, Etc..........................93
SECTION 7.03. CNAI, CGMI, Citibank, CSCI and Affiliates.....................93
SECTION 7.04. Lender Party Credit Decision..................................93
SECTION 7.05. Indemnification...............................................94
SECTION 7.06. Successor Administrative Agent................................95
SECTION 7.07. Liability.....................................................95
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SECTION 7.08. Treatment of Lenders..........................................95
SECTION 7.09. Miscellaneous.................................................96
(a) Instructions..............................................96
(b) No Obligation.............................................96
SECTION 7.10. Arranger Parties..............................................96
ARTICLE VIII
MISCELLANEOUS
SECTION 8.01. Amendments, Etc...............................................96
SECTION 8.02. Notices, Etc..................................................97
SECTION 8.03. No Waiver, Remedies...........................................99
SECTION 8.04. Costs and Expenses............................................99
SECTION 8.05. Right of Set-off.............................................101
SECTION 8.06. Binding Effect...............................................101
SECTION 8.07. Assignments and Participations...............................101
SECTION 8.08. Execution in Counterparts....................................105
SECTION 8.09. Jurisdiction, Etc............................................106
SECTION 8.10. Governing Law................................................106
SECTION 8.11. Waiver of Jury Trial.........................................106
SECTION 8.12. Confidentiality..............................................106
SECTION 8.13. Benefits of Agreement........................................108
SECTION 8.14. Severability.................................................108
SECTION 8.15. Limitations..................................................108
SECTION 8.16. Survival.....................................................108
SECTION 8.17. USA Patriot Act Notice.......................................109
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SCHEDULES
Schedule I Commitments and Applicable Lending Offices
Schedule 1.01(a) - Existing L/Cs
Schedule 3.01(a) - Jurisdictions
Schedule 4.01(c) - Governmental Approvals and Filings
Schedule 4.01(e) - Disclosed Litigation
Schedule 4.01(f) - Disclosed Information
Schedule 4.01(k) - Certain Environmental Matters
Schedule 4.01(n) - Existing Debt
Schedule 4.01(o) - Existing Liens
Schedule 5.01(j) - Affiliate Transactions
EXHIBITS
Exhibit A-1 - Form of Revolving Note
Exhibit A-2 - Form of Term Note
Exhibit B - Form of Notice of Borrowing
Exhibit C - Form of Assignment and Acceptance
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CREDIT AGREEMENT
CREDIT AGREEMENT dated as of May 22, 2006 (as amended, modified or
otherwise supplemented from time to time in accordance with its terms, this
"Agreement"), among ALLEGHENY ENERGY, INC., a Maryland corporation ("AYE"),
ALLEGHENY ENERGY SUPPLY COMPANY, LLC, a Delaware limited liability company
("AESC", and together with AYE, collectively, the "Borrowers"), the banks,
financial institutions and other institutional lenders listed on the signature
pages hereof as the Initial Lenders (the "Initial Lenders"), THE BANK OF NOVA
SCOTIA ("BNS") as the initial issuing bank for the letters of credit pursuant
to this Agreement (in such capacity, the "Initial Issuing Bank" and, together
with the Initial Lenders, the "Initial Lender Parties"), CITIGROUP GLOBAL
MARKETS INC. ("CGMI"), as Joint Lead Arranger and Joint Book Runner, CREDIT
SUISSE, Cayman Islands Branch ("CSCI"), as Joint Lead Arranger, Joint Book
Runner and Syndication Agent, and CITICORP NORTH AMERICA, INC. ("CNAI"), not
in its individual capacity except as expressly set forth hereunder but solely
as administrative agent (together with any successor administrative agent
appointed pursuant to Article VII, the "Administrative Agent") for the Lender
Parties (as hereinafter defined).
PRELIMINARY STATEMENTS
(1) The Borrowers are indebted to certain banks and financial
institutions (the "Existing Lenders") pursuant to that certain credit
agreement dated as of June 16, 2005 (as amended through the date hereof, the
"Existing Credit Agreement").
(2) The Existing L/Cs (as hereinafter defined) are outstanding and shall
be continued under this Agreement as set forth hereunder.
(3) The Borrowers have requested that the Initial Lender Parties
establish a senior unsecured revolving credit facility in the aggregate amount
of $400,000,000 in favor of the Borrowers, with up to (a) the full amount
thereof to be made available to AYE in the form of Revolving Advances (as
hereinafter defined) or one or more Letters of Credit (as hereinafter defined)
issued at the request of AYE on behalf of itself or any of its Subsidiaries
(as hereinafter defined), including the AESC Companies (as hereinafter
defined); provided that the face amount of all outstanding Letters of Credit
issued at the request of AYE on behalf of AESC or any of AESC's Subsidiaries
will not exceed $125,000,000 in the aggregate and (b) $50,000,000 thereof to
be made available to AESC in the form of Revolving Advances or one or more
Letters of Credit issued at the request of AESC on behalf of AESC or any of
its Subsidiaries; provided that (i) the principal amount of all Revolving
Advances made to AESC, together with the face amount of all Letters of Credit
issued at the request of AESC, in each case outstanding at any time shall not
exceed $50,000,000, (ii) no Revolving Advance shall be made to, or a Letter of
Credit issued at the request of, AESC unless AYE has a minimum of $100,000,000
in pro forma undrawn availability under the Revolving Facility (as hereinafter
defined) and (iii) AYE is jointly and severally liable for all Revolving
Advances made to and Letters of Credit issued on behalf of, or at the request
of, AESC. The Initial Lender Parties have indicated their willingness to
provide such financing to the Borrowers on the terms and conditions of this
Agreement and the other Loan Documents (as hereinafter defined).
(4) AYE has also requested that the Initial Lender Parties establish a
senior unsecured term credit facility in the aggregate amount of $179,071,429
in favor of AYE. The Initial Lender Parties have indicated their willingness
to provide such financing to AYE on the terms and conditions of this Agreement
and the other Loan Documents (as hereinafter defined).
(5) The proceeds of the Revolving Facility shall be used (a) on the
Closing Date (as hereinafter defined) to (i) together with proceeds of the
Term Facility (as hereunder defined), refinance the aggregate principal amount
outstanding under the Existing Credit Agreement and (ii) continue the Existing
L/Cs under this Agreement, and (b) after the Closing Date, to provide working
capital for AYE and its Subsidiaries, including AESC and its Subsidiaries.
(6) The proceeds of the Term Facility, together with proceeds of
Revolving Advances made on the Closing Date, shall be used to refinance the
aggregate principal amount outstanding under the Existing Credit Agreement.
NOW, THEREFORE, in consideration of the premises and of the mutual
covenants and agreements contained herein, the parties hereto hereby agree as
follows:
ARTICLE I.
DEFINITIONS AND ACCOUNTING TERMS
SECTION 1.01. Certain Defined Terms. As used in this Agreement, the
following terms shall have the following meanings:
"1940 Act" means the Investment Company Act of 1940, as amended.
"Act" has the meaning specified in Section 8.17.
"Administrative Agent" has the meaning specified in the recital of
parties to this Agreement.
"Administrative Agent's Account" means the account of the Administrative
Agent maintained by the Administrative Agent with Citibank, at its office at
000 Xxxx Xxxxxx, Xxx Xxxx, Xxx Xxxx (ABA No. 000000000), Account No. 00000000,
Reference: Allegheny Energy, Inc., or such other account as the Administrative
Agent shall specify in writing to the Borrowers and each of the Lender
Parties.
"Advance" means a Revolving Advance or a Term Advance, as the context
may require.
"AESC" has the meaning specified in the recital of parties to this
Agreement.
"AESC Credit Agreement" means that certain Credit Agreement, dated as of
May 2, 2006, among AESC, the financial institutions referred to therein as
Lenders, and Citicorp USA, Inc., as Administrative Agent.
2
"AESC Security Agreement" means that certain Security Agreement, dated
as of May 2, 2006, among AESC, Citicorp USA Inc., as Administrative Agent, and
Citibank, N.A., as Collateral Agent.
"AESC Companies" means AESC and its Subsidiaries.
"AESC Direct Advance and L/C Sublimit" means $50,000,000. The AESC
Direct Advance and L/C Sublimit is part of, and not in addition to, the
Revolving Facility.
"AESC Direct L/C Credit Extension" means, with respect to any AESC
Direct Letter of Credit, the issuance thereof or extension of the expiry date
thereof, or the increase of the amount thereof.
"AESC Direct L/C Obligations" means, as at any date of determination,
the aggregate undrawn amount of all outstanding AESC Direct Letters of Credit
plus the aggregate of all Unreimbursed Amounts with respect to AESC Direct
Letters of Credit, including all L/C Borrowings under AESC Direct Letters of
Credit. For all purposes of this Agreement, if on any date of determination an
AESC Direct Letter of Credit has expired by its terms but any amount may still
be drawn thereunder by reason of the operation of Rule 3.14 of the ISP, such
AESC Direct Letter of Credit shall be deemed to be "outstanding" in the amount
so remaining available to be drawn.
"AESC Direct Letters of Credit" means letters of credit issued by any
Issuing Bank pursuant to Section 2.01(f).
"AESC Indirect L/C Credit Extension" means, with respect to any AESC
Indirect Letter of Credit, the issuance thereof or extension of the expiry
date thereof, or the increase of the amount thereof.
"AESC Indirect L/C Obligations" means, as at any date of determination,
the aggregate undrawn amount of all outstanding AESC Indirect Letters of
Credit plus the aggregate of all Unreimbursed Amounts with respect to AESC
Indirect Letters of Credit, including all L/C Borrowings under AESC Indirect
Letters of Credit. For all purposes of this Agreement, if on any date of
determination an AESC Indirect Letter of Credit has expired by its terms but
any amount may still be drawn thereunder by reason of the operation of Rule
3.14 of the ISP, such AESC Indirect Letter of Credit shall be deemed to be
"outstanding" in the amount so remaining available to be drawn.
"AESC Indirect L/C Sublimit" means $125,000,000. The AESC Indirect L/C
Sublimit is part of, and not in addition to, the Revolving Facility.
"AESC Indirect Letters of Credit" means letters of credit issued by any
Issuing Bank pursuant to Section 2.01(e).
"AESC Loan Documents" means the AESC Credit Agreement and the AESC
Security Agreement, as each may be amended, amended and restated, supplemented
or otherwise modified from time to time.
3
"AESC Sublimits" means the AESC Indirect L/C Sublimit and the AESC
Direct Advance and L/C Sublimit.
"Affiliate" means, as to any Person, any other Person that, directly or
indirectly, controls, is controlled by or is under common control with such
Person or is a director or officer of such Person. For purposes of this
definition, the term "control" (including the terms "controlling", "controlled
by" and "under common control with") of a Person means the possession, direct
or indirect, of the power to vote 10% or more of the Voting Interests of such
Person or to direct or cause the direction of the management and policies of
such Person, whether through the ownership of Voting Interests, by contract or
otherwise.
"AGC" means Allegheny Generating Company, a Virginia corporation.
"AGC Transmission Line" means, collectively, (a) the 500 kilovolt
interconnection and transmission facilities for the power generation station
owned by AGC, including transmission lines, substations, transformers,
breakers, relays, switches, switchyards, synchronizing equipment, metering
equipment and other equipment relating thereto (and, in each case, is not
required for the generation of electric energy by the power generation station
owned by AGC), (b) the land owned by AGC, if any, on which any such facilities
are situated (to the extent the power generation station owned by AGC is not
also situated on such land) and (c) all easements, licenses and rights-of-way
of AGC in respect of such interconnection and transmission facilities.
"Agent Parties" has the meaning set forth in Section 8.02(d).
"Agreement" has the meaning set forth in the recital of the parties to
this agreement.
"Agreement Value" means, for each Hedge Agreement, on any date of
determination, an amount determined by AYE in good faith equal to: (a) in the
case of a Hedge Agreement documented pursuant to the ISDA Master Agreement,
the amount, if any, that would be payable by any Borrower or any Subsidiary of
any Borrower to its counterparty to such Hedge Agreement pursuant to the terms
of such Hedge Agreement, as if (i) such Hedge Agreement was being terminated
early on such date of determination, (ii) such Borrower or Subsidiary was the
sole "Affected Party", and (iii) such Borrower or Subsidiary was the sole
party determining such payment amount (with AYE making such determination
pursuant to the provisions of the ISDA Master Agreement or the Hedge Agreement
(whichever is applicable)); or (b) in the case of a Hedge Agreement traded on
an exchange, the xxxx-to-market value of such Hedge Agreement, which will be
the unrealized loss on such Hedge Agreement (after any netting permitted
pursuant to the terms of such Hedge Agreement (including any netting across
different Hedge Agreements and ISDA Master Agreements to the extent permitted
by contract)) to the relevant Borrower or any Subsidiary of any Borrower party
to such Hedge Agreement determined by AYE in good faith based on the
settlement price of such Hedge Agreement on such date of determination; or (c)
in all other cases, the xxxx-to-market value of such Hedge Agreement, which
will be the unrealized loss on such Hedge Agreement (after any
4
netting permitted pursuant to the terms of such Hedge Agreement (including any
netting across different Hedge Agreements and ISDA Master Agreements to the
extent permitted by contract)) to the relevant Borrower or Subsidiary of any
Borrower party to such Hedge Agreement, if any, as determined by AYE in
accordance with the terms of such Hedge Agreement or, if such Hedge Agreement
does not provide a methodology for such determination, the amount, if any, by
which (i) the present value of the future cash flows to be paid by such
Borrower or Subsidiary party thereto, as the case may be, exceeds (ii) the
present value of the future cash flows to be received by such Borrower or
Subsidiary, as the case may be, pursuant to such Hedge Agreement; capitalized
terms used and not otherwise defined in this definition shall have the
respective meanings set forth in the above described ISDA Master Agreement.
"Allegheny Pittsburgh Coal" means Allegheny Pittsburgh Coal Company, a
Pennsylvania corporation.
"Amendment Fee" means any fee offered, paid or payable to any Lender
Party by the Borrower or any Affiliate of the Borrower (whether directly or
through the Administrative Agent or any other Person) in consideration for any
waiver of, or agreement to amend or modify any provision of, any of the Loan
Documents.
"Annualization Factor" means, on any date of determination, (a) if only
one fiscal quarter has elapsed since July 1, 2005, four, (b) if only two
fiscal quarters have elapsed since July 1, 2005, two and (c) if only three
fiscal quarters have elapsed since July 1, 2005, four thirds.
"Applicable Law" means, with respect to any Person, any and all laws,
statutes, regulations or rules, or orders, injunctions, decrees, judgments,
writs, determinations or awards having the force or effect of binding such
Person at law issued by any Governmental Authority, applicable to such Person,
including all Environmental Laws.
"Applicable Lending Office" means, with respect to each Lender Party,
such Lender Party's Domestic Lending Office in the case of a Base Rate Advance
and such Lender Party's Eurodollar Lending Office in the case of a Eurodollar
Rate Advance.
"Applicable Margin" means, as of any date, a percentage per annum
determined by reference to the Public Debt Rating in effect on such date as
set forth below:
==============================================================================
Applicable Margin
Public Debt Applicable Margin for Applicable Margin
Rating for Eurodollar Rate for Letters of
S&P/Xxxxx'x Base Rate Advances Advances Credit
==============================================================================
Xxxxx 0 0% 0.45% 0.45%
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BBB+/Baa1
or above
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Xxxxx 0 0% 0.55% 0.55%
-------
BBB/Baa2
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Xxxxx 0 0% 0.75% 0.75%
-------
BBB-/Baa3
------------------------------------------------------------------------------
5
------------------------------------------------------------------------------
Xxxxx 0 0% 0.875% 0.875%
-------
BB+/Ba1
------------------------------------------------------------------------------
Xxxxx 0 0% 1.00% 1.00%
-------
BB/Ba2
------------------------------------------------------------------------------
Xxxxx 0 0.50% 1.50% 1.50%
-------
Below BB/Ba2
=============================================================================
"Appropriate Lender" means, at any time, with respect to (a) the
Revolving Facility, the Borrowing Limit or either AESC Sublimit, a Revolving
Lender, and (b) the Term Facility, a Term Lender.
"Approved Fund" means a Fund that is administered or managed by (a) a
Lender, (b) an Affiliate of a Lender or (c) a Person or an Affiliate of a
Person that administers or manages a Lender.
"Arranger Parties" means CGMI, as Joint Lead Arranger and Joint Book
Runner, and CSCI, as Joint Lead Arranger, Joint Book Runner and Syndication
Agent.
"Assets" means, with respect to any Person, all or any part of its
business, property, rights, interests and assets, both tangible and intangible
(including Equity Interests in any other Person), wherever situated.
"Assignment and Acceptance" means an assignment and acceptance entered
into by a Lender Party and an Eligible Assignee, and accepted by the
Administrative Agent, in accordance with Section 8.07 and in substantially the
form of Exhibit C.
"Authorized Signatory" means, with respect to any Person, the
individual, or any of the individuals, authorized to sign any Loan Document,
as well as any other agreements, to which such Person is or is to be a party
and give written instructions on behalf of such Person with regard to any
matters pertaining to any Loan Document to which such Person is or is to be a
party (as identified on an incumbency certificate submitted to the
Administrative Agent from time to time prior to the receipt of any
instructions from such Authorized Signatory).
"Auto-Extension Letter of Credit" has the meaning specified in Section
2.03(a)(iii).
"AYE" has the meaning specified in the recital of parties to this
Agreement.
"AYE Funds Flow" means, for any period, the sum for the related period
of (a) cash dividends received by AYE from the Regulated Subsidiaries and
AESC, less (b) any cash equity contributions made by AYE to any Subsidiaries,
plus (c) Net Cash Proceeds received by AYE from the sale or issuance of any
Equity Interests, plus (d) AYE's interest income, less (e) Capital
Expenditures of AYE, less (f) operating expenses of AYE, excluding AYE
Interest Expense and income tax expense, plus (g) Litigation Proceeds received
by AYE, plus (h) AYE Sales Proceeds.
6
"AYE Interest Expense" means, for any period, (a) the sum of, without
duplication, (i) the interest expense (including imputed interest expense in
respect of Capitalized Leases) of AYE for such period (including all
commissions, discounts and other fees and charges owed by AYE with respect to
letters of credit and bankers' acceptance financing), in each case determined
in accordance with GAAP, plus (ii) any interest accrued during such period in
respect of Debt of AYE that is required to be capitalized rather than included
in interest expense of AYE for such period in accordance with GAAP, minus (b)
to the extent included in such interest expense referred to in clause (a)(i)
for such period, amounts attributable to the amortization of financing costs
and non-cash amounts attributable to the amortization of debt discounts in
respect of Debt of AYE; provided, however, that the accrued interest and
interest paid under the summary judgment granted against AYE in the Xxxxxxx
Xxxxx Litigation shall not be included in any determination of the interest
expense of AYE. For purposes of the foregoing, interest expense shall be
determined after giving effect to any net payments made or received by AYE
with respect to interest rate Hedging Agreements.
"AYE L/C Credit Extension" means, with respect to any AYE Letter of
Credit, the issuance thereof or extension of the expiry date thereof, or the
increase of the amount thereof.
"AYE L/C Obligations" means, as at any date of determination, the
aggregate undrawn amount of all outstanding AYE Letters of Credit plus the
aggregate of all Unreimbursed Amounts with respect to AYE Letters of Credit,
including all L/C Borrowings under AYE Letters of Credit. For all purposes of
this Agreement, if on any date of determination an AYE Letter of Credit has
expired by its terms but any amount may still be drawn thereunder by reason of
the operation of Rule 3.14 of the ISP, such AYE Letter of Credit shall be
deemed to be "outstanding" in the amount so remaining available to be drawn.
"AYE Letters of Credit" means (a) the Existing L/Cs, as continued under
this Agreement on the Closing Date, and (b) any other Letters of Credit issued
by any Issuing Bank pursuant to Section 2.01(d).
"AYE Sales Proceeds" means net cash proceeds received by AYE from any
sale, transfer or other disposition of any of AYE's assets.
"Base Rate" means a fluctuating interest rate per annum in effect from
time to time, which rate per annum shall at all times be equal to the higher
of:
(a) the rate of interest announced publicly by Citibank in
New York, New York, from time to time, as Citibank's base rate;
and
(b) 1/2 of 1% per annum above the Federal Funds Rate.
"Base Rate Advance" means an Advance that bears interest as provided in
Section 2.07(a)(i).
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"Bath County" means the undivided forty percent (40%) interest
(constituting 1035 MW of pumped storage) owned by a Subsidiary of AYE in the
hydroelectric power generating station located in Bath County, Virginia.
"BNS" has the meaning specified in the recital of parties to this
Agreement.
"Borrowers" has the meaning specified in the recital of parties to this
Agreement.
"Borrowing Account" means, with respect to any Borrower, such account as
such Borrower shall specify in writing to the Administrative Agent.
"Borrowing" means a Revolving Borrowing or a Term Borrowing.
"Borrowing Limit" means, as of any time with respect to (a) AYE, an
amount equal to the aggregate of the Unused Commitments at such time, and (b)
AESC, the AESC Direct Advance and L/C Sublimit minus (i) the aggregate
principal amount of all outstanding Revolving Advances made to AESC at such
time and (ii) the Outstanding Amount of all AESC Direct L/C Obligations at
such time.
"Buffalo Creek Reserve" means the Xxxxxxxxxx Xx. 0 Seam of coal and
other natural resources in and underlying that certain boundary of land
containing approximately twenty thousand (20,000) acres of property and
approximately three hundred (300) acres of surface property commonly referred
to as the "Buffalo Reserve" and situated near Avella, in Washington County and
adjoining counties in the Commonwealth of Pennsylvania and the State of West
Virginia.
"Buffalo Creek SPV" means (a) Allegheny Pittsburgh Coal, (b) any special
purpose wholly owned direct or indirect Subsidiary of AYE, whose assets are
comprised solely of (i) the Buffalo Creek Reserve and related or other
immaterial Assets, including contractual and other rights to develop the
Buffalo Creek Reserve or any portion thereof in connection with the Buffalo
Reserve Project, or (ii) Equity Interests in any other special purpose wholly
owned Subsidiary of AYE (other than an AESC Company) which directly or
indirectly (through other similar special purpose wholly owned Subsidiaries of
AYE (other than an AESC Company)) holds the Buffalo Creek Reserve or other
related or immaterial Assets or (c) any Joint Venture established to own or
develop the Buffalo Creek Reserve in accordance with Section 5.02(f)(x).
"Buffalo Reserve Project" means the development of property and mineral
and other natural resource rights in the Buffalo Creek Reserve, including (a)
the formation of one or more Buffalo Creek SPVs to pursue the development of
the Buffalo Creek Reserve, (b) the restructuring, in connection with the
development of such Buffalo Creek Reserve, of Allegheny Pittsburgh Coal or any
other direct or indirect Subsidiary of AYE or the creation of one or more
direct or indirect Subsidiaries of AYE, in each case as a Buffalo Creek SPV,
for the purpose of holding such property, mineral rights, other natural
resource rights and other contractual and other assets associated therewith,
the transfer, sale, distribution, assignment or other disposition of such
property, mineral rights, other natural resource rights and other assets to
such Buffalo Creek SPV, as applicable, in each case whether in a single
transaction or a series of related transactions,
8
(c) the transfer, sale, distribution, assignment or other disposition of the
Equity Interests in a Buffalo Creek SPV to AYE or another Buffalo Creek SPV,
or the merger of any Buffalo Creek SPV into another Buffalo Creek SPV, in each
case, whether in one transaction or a series of related transactions, (d) the
sale, lease, transfer, assignment or other disposition of the property mineral
rights, other natural resource rights, contractual rights relating thereto and
other related Assets associated with the Buffalo Creek Reserve and (e) the
entering into operating agreements, joint venture agreements, partnership
agreements, working interests, royalty interests, leases, processing
agreements, contracts for sale, transfer or distribution of assets,
transportation or exchange agreements, unitization agreements, pooling
agreements, area of mutual interest agreements, production sharing agreements,
performance guarantees, purchase option agreements or other similar or
customary agreements, transactions, interests or arrangements, and equity
purchases and other Investments and expenditures in connection with the
development of such rights in the Buffalo Creek Reserve.
"Business Day" means a day of the year on which banks are not required
or not authorized by law to close in New York City and, if the applicable
Business Day relates to any Eurodollar Rate Advances, on which dealings are
carried on in the London interbank market.
"Capital Expenditures" means, for any Person for any period, the sum of,
without duplication, all expenditures made, directly or indirectly, by such
Person during such period (whether financed by cash or by Debt (including
Obligations under Capitalized Leases) assumed or incurred to fund, directly or
indirectly, such expenditures) for equipment, fixed assets, real property or
improvements, or for replacements or substitutions therefor or additions
thereto, that have been or should be, in accordance with GAAP, reflected as
additions to property, plant or equipment on a balance sheet of such Person.
For purposes of this definition, the purchase price of equipment that is
purchased simultaneously with the trade-in of existing equipment or with
insurance proceeds shall be included in Capital Expenditures only to the
extent of the excess (if any) of the gross amount of such purchase price over
the credit granted by the seller of such equipment for the equipment being
traded in at such time or the amount of such proceeds, as the case may be.
"Capitalized Leases" means all leases that have been or should be, in
accordance with GAAP, recorded as capitalized leases.
"Cash Collateral Account" means a non-interest bearing securities
account opened, or to be opened, by the Administrative Agent and in which a
Lien has been granted to the Administrative Agent for the benefit of each
Revolving Lender and each Issuing Bank pursuant to documentation in form and
substance reasonably satisfactory to the Administrative Agent and each Issuing
Bank (which documents are hereby consented to by the Revolving Lenders) to the
extent that any Letter of Credit is required to be Cash Collateralized in
accordance with this Agreement.
"Cash Collateralize" means to pledge and deposit with or deliver to the
Administrative Agent, for the benefit of each Issuing Bank and each Revolving
Lender,
9
as collateral for the L/C Obligations, cash or deposit account balances and
"Cash Collateral" shall refer to such cash or deposit balances.
"Cash Equivalents" means any of the following, to the extent owned by
any Borrower or any of its Subsidiaries free and clear of all Liens (other
than Liens not prohibited under this Agreement) and, except in the case of
clause (d) below, having a maturity of not greater than one year from the date
of issuance thereof: (a) readily marketable direct obligations of the
Government of the United States or any agency or instrumentality thereof or
obligations unconditionally guaranteed by the full faith and credit of the
Government of the United States, (b) certificates of deposit, time deposits,
eurodollar deposits and bankers' acceptances with any commercial bank that is
the Administrative Agent or a Lender Party or a member of the Federal Reserve
System, is organized under the laws of the United States or any State thereof
and has combined capital and surplus of at least $500,000,000; provided that
the aggregate principal amount of certificates of deposit, time deposits,
eurodollar time deposits and bankers acceptances of any one bank shall not
exceed $50,000,000 at any one time, (c) commercial paper in an aggregate
amount of no more than $50,000,000 per issuer outstanding at any time, issued
by any corporation organized under the laws of any State of the United States
and rated at least "Prime-1" (or the then equivalent grade) by Xxxxx'x or
"A-1" (or the then equivalent grade) by S&P, or (d) investments in mutual
funds the sole investments of which are the cash equivalents identified in
clauses (a) through (c) above (but with a remaining maturity of not greater
than 13 months while being held by the applicable mutual fund) and repurchase
obligations for any of the cash equivalents identified in clause (a) above.
"CERCLA" means the Comprehensive Environmental Response, Compensation
and Liability Act of 1980, as amended from time to time.
"CERCLIS" means the Comprehensive Environmental Response, Compensation
and Liability Information System maintained by the U.S. Environmental
Protection Agency.
"CGMI" has the meaning specified in the recital of parties to this
Agreement.
"Change of Control" means the occurrence of any of the following: (a)
any Person or two or more Persons acting in concert shall have acquired
beneficial ownership (within the meaning of Rule 13d-3 of the SEC under the
Securities Exchange Act of 1934), directly or indirectly, of Voting Interests
of AYE (or other securities convertible into such Voting Interests)
representing 30% or more of the combined voting power of all Voting Interests
of AYE; or (b) during any period of up to 24 consecutive months, commencing
after the date of this Agreement, individuals who at the beginning of such
24-month period were directors of AYE (the "Original Directors") shall cease
for any reason to constitute a majority of the board of directors of AYE
(unless replaced by individuals nominated or proposed by the Original
Directors); or (c) any Person or two or more Persons acting in concert shall
have acquired by contract or otherwise, or shall have entered into a contract
or arrangement that, upon consummation, will result in its or their
10
acquisition of the power to exercise, directly or indirectly, a controlling
influence over the management or policies of AYE.
"Chief Financial Officer" of any Person means such Person's chief
financial officer or such other natural person who is principally responsible
for such Person's financial matters.
"Citibank" means Citibank, N.A.
"Closing Date" has the meaning specified in Section 3.01(a).
"Closing Date Transactions" has the meaning specified in Section
3.01(a)(xiii).
"CNAI" has the meaning specified in the recital of parties to this
Agreement.
"Code" means the Internal Revenue Code of 1986, as amended from time to
time, and the regulations promulgated and rulings issued thereunder.
"Commitment" means, as to each Lender, such Lender's Revolving
Commitment or Term Commitment, as the context may require.
"Commitment Fee Rate" means, as of any date, a percentage per annum
determined by reference to the Public Debt Rating in effect on such date as
set forth below:
====================== ====================
Public Debt Rating Commitment Fee
S&P/Xxxxx'x Rate
====================== ====================
Level 1 0.08%
-------
BBB+/Baa1
or above
---------------------- --------------------
Xxxxx 0 0.10%
-------
BBB/Baa2
---------------------- --------------------
Xxxxx 0 0.125%
-------
BBB-/Baa3
---------------------- --------------------
Xxxxx 0 0.20%
-------
BB+/Ba1
---------------------- --------------------
Xxxxx 0 0.25%
-------
BB/Ba2
---------------------- --------------------
Xxxxx 0 0.30%
-------
Below BB/Ba2
====================== ====================
"Commodity Hedge Agreement" means any swap, cap, collar, floor, future,
option, spot, forward, power purchase agreement, power sale agreement,
electric power generation capacity purchase and sale agreement, fuel purchase
agreement, fuel sale agreement, power transmission agreement, regional
transmission organization agreements, fuel transportation agreement, fuel
storage agreement, netting agreement or similar agreement (including each
confirmation entered into pursuant to any master
11
agreement) entered into in the ordinary course of business in order to manage
fluctuations in the price or availability to AYE or any of its Subsidiaries of
any energy-related commodity including Emissions Credits and energy
attributes. For purposes of this definition "commodity" means any tangible or
intangible commodity of any type or description, including electric power,
electric power capacity, petroleum, coal, urea, financial transmission rights,
natural gas and by products thereof.
"Communications" has the meaning specified in Section 8.02(b).
"Confidential Information" has the meaning specified in Section 8.12(a).
"Consolidated" refers to the consolidation of accounts in accordance
with GAAP.
"Constituent Documents" means, with respect to any Person, (a) the
articles or certificate of incorporation, charter or other similar
organizational document of such Person, (b) the by-laws or other similar
document of such Person, (c) any certificate of designation or instrument
relating to the rights of holders (including preferred shareholders) of Equity
Interests in such Person and (d) any shareholder rights agreement or other
similar agreement.
"Contest" means, with respect to the payment of Taxes or any other
claims or liabilities by any Person, to contest the validity or amount thereof
in good faith by appropriate proceedings timely instituted and diligently
pursued within the applicable statutory period and in accordance with
Applicable Law; provided that the following conditions are satisfied: (a) such
Person has posted a bond or other security in accordance with Applicable Law
(if required) or has established adequate reserves with respect to the
contested items in accordance with, and to the extent required by, GAAP; (b)
during the period of such contest, the enforcement of any contested item is
effectively stayed; (c) neither such Person nor any of its officers, directors
or employees nor any Lender Party, the Administrative Agent or any of their
respective officers, directors or employees is, or could reasonably be
expected to become, subject to any criminal liability or sanction in
connection with such contested items; and (d) no Lien relating to such contest
attaches to any Assets of such Person and becomes enforceable against other
creditors of such Person.
"Contingent Obligation" means, with respect to any Person, any
Obligation or arrangement of such Person to guarantee or intended to guarantee
any Debt, leases, dividends or other payment Obligations ("primary
obligations") of any other Person (the "primary obligor") in any manner,
whether directly or indirectly, including (a) the direct or indirect
guarantee, endorsement (other than for collection or deposit in the ordinary
course of business), co-making, discounting with recourse or sale with
recourse by such Person of the Obligation of a primary obligor, (b) the
Obligation to make take-or-pay or similar payments, if required, regardless of
nonperformance by any other party or parties to an agreement or (c) any
Obligation of such 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 (A) for the purchase or payment of
any such primary obligation or (B) to maintain working capital or equity
capital of the
12
primary obligor or otherwise to maintain the net worth or solvency of the
primary obligor, (iii) to purchase Assets, securities or services primarily
for the purpose of assuring the owner of any such primary obligation of the
ability of the primary obligor to make payment of such primary obligation or
(iv) otherwise to assure or hold harmless the holder of such primary
obligation against loss in respect thereof. The amount of any Contingent
Obligation shall be deemed to be an amount equal to the stated or determinable
amount of the primary obligation in respect of which such Contingent
Obligation is made (or, if less, the maximum amount of such primary obligation
for which such Person may be liable pursuant to the terms of the instrument
evidencing such Contingent Obligation) or, if not stated or determinable, the
maximum reasonably anticipated liability in respect thereof (assuming such
Person is required to perform thereunder), as determined by such Person in
good faith.
"Continuation", "Continue" and "Continued" each refer to a continuation
of Eurodollar Rate Advances upon the expiration of the Interest Period
therefor as Eurodollar Rate Advances of the same or a different Interest
Period pursuant to Section 2.10.
"Conversion", "Convert" and "Converted" each refer to a conversion of
Advances of one Type into Advances of the other Type pursuant to Section 2.10
or 2.11.
"CSCI" has the meaning specified in the recital of parties to this
Agreement.
"Debt" of any Person (the "obligor") means, without duplication, (a) all
Obligations of such obligor for or in respect of moneys borrowed or raised
(whether or not for cash by whatever means (including acceptances, deposits,
discounting, letters of credit, factoring (other than on a non-recourse
basis), and any other form of financing that is recognized in accordance with
GAAP in the obligor's financial statements as being in the nature of a
borrowing or is treated as "off-balance" sheet financing; (b) all Obligations
of the obligor evidenced by notes, bonds, debentures or other similar
instruments issued in connection with accounts payable excluded pursuant to
the parenthetical in clause (c) below; (c) all Obligations of the obligor for
the deferred purchase price of property or services (other than accounts (i)
payable within 90 days of being incurred arising in the ordinary course of
such obligor's business and not more than 90 days past due or (ii) subject to
a Contest); (d) all Obligations of such obligor under conditional sale or
other title retention agreements relating to Assets acquired by such obligor
(even though the rights and remedies of the seller or lender under such
agreement in the event of default are limited to repossession or sale of such
property); (e) all Obligations of such obligor under any securitization or
monetization arrangement; (f) all Obligations of such obligor as lessee under
Capitalized Leases; (g) all Obligations of the obligor, contingent or
otherwise, of the obligor under acceptance, letter of credit or similar
facilities other than as issued (i) in connection with Obligations excluded
pursuant to clause (b) above or the parenthetical in clause (c) above or (ii)
as credit support for leases other than Capitalized Leases; (h) all
Obligations of the obligor to purchase, redeem, retire, defease or otherwise
make any payments in respect of any Equity Interests in the obligor or any
other Person or any warrants, rights or options to acquire such capital stock,
valued, in the case of Redeemable Preferred Interests, at the greater of its
13
voluntary or involuntary liquidation preference plus accrued and unpaid
dividends; (i) all Obligations of the obligor in respect of Hedge Agreements;
(j) all Contingent Obligations of the obligor with respect to Debt; and (k)
all indebtedness and other payment Obligations referred to in clauses (a)
through (j) above of another Person secured by (or for which the holder of
such Debt has an existing right, contingent or otherwise, to be secured by)
any Lien on property (including accounts and contract rights owned by the
obligor), even though the obligor has not assumed or become liable for the
payment of such indebtedness or other payment Obligations. For the avoidance
of doubt, any account payable owed to AYE or any of its Subsidiaries by AYE or
any of its Subsidiaries (an "internal obligor"), as the case may be, with
respect to an account payable of the internal obligor owed to a Person other
than AYE or any of its Subsidiaries that is payable within 90 days of being
incurred arising in the ordinary course of such internal obligor's business
and not more than 90 days past due and not subject to a Contest shall not
constitute Debt.
"Debt for Borrowed Money" means Debt of the types specified in (i)
clauses (a), (b), (d), (e) and (f) of the definition of Debt and (ii) to the
extent relating to Debt of the types specified in one or more of clauses (a),
(b), (d), (e) and (f) of the definition of Debt, clauses (j) and (k) thereof.
"Default" means any Event of Default or any event that would constitute
an Event of Default but for the requirement that notice be given or time
elapse or both.
"Disclosed Litigation" has the meaning specified in Section 4.01(e).
"Disclosed Matters" means the occurrence of any event in respect of, or
effect upon the business, condition (financial or otherwise), operations,
performance, properties, assets, liabilities (actual or contingent), results
of operations or prospects of AYE or AYE and its Subsidiaries, taken as a
whole, which has been disclosed (a) pursuant to a public filing by AYE or its
Subsidiaries with the SEC or (b) in writing to the Administrative Agent.
"Dollars" and "$" mean the lawful currency of the United States of
America.
"Domestic Lending Office" means, with respect to any Lender Party, the
office of such Lender Party specified as its "Domestic Lending Office"
opposite its name on Schedule I or in the Assignment and Acceptance pursuant
to which it became a Lender Party, as the case may be, or such other office of
such Lender Party as such Lender Party may from time to time specify to AYE
and the Administrative Agent.
"Eligible Assignee" means (a) with respect to any Lender, (i) any other
Lender; (ii) an Affiliate of a Lender; (iii) an Approved Fund; (iv) a
commercial bank organized under the laws of the United States, or any State
thereof, and having a combined capital and surplus of at least $500,000,000;
(v) a savings and loan association or savings bank organized under the laws of
the United States, or any State thereof, and having a combined capital and
surplus of at least $500,000,000; (vi) a commercial bank organized under the
laws of any other country that is a member of the OECD or has concluded
14
special lending arrangements with the International Monetary Fund associated
with its General Arrangements to Borrow or a political subdivision of any such
country, and having a combined capital and surplus of at least $500,000,000,
so long as such bank is acting through a branch or agency located in the
country in which it is organized or another country that is described in this
clause (vi); (vii) the central bank of any country that is a member of the
OECD; (viii) a finance company, insurance company or other financial
institution or fund (whether a corporation, partnership, trust or other
entity) that is engaged in making, purchasing or otherwise investing in
commercial loans in the ordinary course of its business and having a combined
capital and surplus of at least $500,000,000; or (ix) any other Person
approved by (A) to the extent such Person is to become an Eligible Assignee in
respect of any assignment of any Revolving Commitment, any Revolving Advance,
any L/C Credit Extension or any L/C Borrowing, the Issuing Bank(s) (each
acting in its sole discretion) and the Administrative Agent (such consent not
to be unreasonably withheld or delayed) and, so long as no Specified Default
shall have occurred and be continuing, AYE (such approval not to be
unreasonably withheld or delayed), and (B) to the extent such Person is to
become an Eligible Assignee in respect of any assignment of any Term
Commitment or any Term Advance, the Administrative Agent (such consent not to
be unreasonably withheld) and, so long as no Specified Default shall have
occurred and be continuing, AYE (such approval not to be unreasonably withheld
or delayed), and (b) with respect to any Issuing Bank, a Person that is an
Eligible Assignee under subclause (iv) or (vi) (so long as such bank is acting
through a branch or agency located in the United States) of clause (a) of this
definition and is approved by the Administrative Agent and, so long as no
Specified Default shall have occurred and be continuing, AYE, such approval
not to be unreasonably withheld or delayed; provided that neither AYE nor any
Affiliate of AYE shall qualify as an Eligible Assignee under this definition;
and provided further that, for the avoidance of doubt, notwithstanding whether
any Person constitutes an "Eligible Assignee", the consent of the Issuing
Bank(s) under Section 8.07(a) shall be required with respect to any assignment
of any Revolving Commitment, any Revolving Advance, any L/C Credit Extension
or any L/C Borrowing.
"Emissions Credits" means the emissions limitations which: (a) are
issued by environmental Governmental Authorities; (b) authorize the emission
of a fixed amount of pollutants; and (c) are utilized as a market-based
mechanism for reducing pollution.
"Environmental Action" means any action, suit, demand letter, claim by
any Governmental Authority, notice of non-compliance or violation, notice of
liability or potential liability, investigation, proceeding, consent order or
consent agreement relating to any Environmental Law, Environmental Permit or
Hazardous Material or arising from alleged injury or threat to health and
safety or the environment relating to any Environmental Law, including (a) by
any governmental or regulatory authority for enforcement, cleanup, removal,
response, remedial or other actions or damages and (b) by any governmental or
regulatory authority or third party for damages, contribution,
indemnification, cost recovery, compensation or injunctive relief.
"Environmental Control Property" has the meaning specified in Section
5.02(e)(viii)(B).
15
"Environmental Control Property Securitization" has the meaning
specified in Section 5.02(e)(viii)(B).
"Environmental Law" means any Federal, state, local or foreign statute,
law, ordinance, rule, regulation, code, order, writ, judgment, injunction,
decree or legally binding judicial or agency interpretation, policy or
guidance relating to pollution or protection of the environment, health and
safety as it relates to Hazardous Materials or natural resources, including
those relating to the use, handling, transportation, treatment, storage,
disposal, release or discharge of Hazardous Materials.
"Environmental Permit" means any permit, approval, identification
number, license or other authorization required under any Environmental Law.
"Equity Interests" means, with respect to any Person, shares of capital
stock of (or other ownership or profit interests in) such Person, warrants,
options or other rights for the purchase or other acquisition from such Person
of shares of capital stock of (or other ownership or profit interests in) such
Person, non-Debt securities convertible into or exchangeable for shares of
capital stock of (or other ownership or profit interests in) such Person, or
warrants, rights or options for the purchase or other acquisition from such
Person of such shares (or such other interests), and other ownership or profit
interests in such Person (including partnership, member or trust interests
therein), whether voting or nonvoting, and whether or not such shares,
warrants, options, rights or other interests are authorized or otherwise
existing on any date of determination.
"ERISA" means the Employee Retirement Income Security Act of 1974, as
amended from time to time, and the regulations promulgated and rulings issued
thereunder.
"ERISA Affiliate" means any Person that for purposes of Title IV of
ERISA is a member of the controlled group of AYE or any of its Subsidiaries,
or under common control with AYE or any of its Subsidiaries, within the
meaning of Section 414 of the Code.
"ERISA Event" means (a) (i) the occurrence of a reportable event, within
the meaning of Section 4043(c) of ERISA, with respect to any Plan unless the
30-day notice requirement with respect to such event has been waived by the
PBGC or (ii) the requirements of Section 4043(b) of ERISA apply with respect
to a contributing sponsor, as defined in Section 4001(a)(13) of ERISA, of a
Plan, and an event described in paragraph (9), (10), (11), (12) or (13) of
Section 4043(c) of ERISA is reasonably expected to occur with respect to such
Plan within the following 30 days; (b) the application for a minimum funding
waiver in accordance with Section 412(d) of the Code with respect to a Plan;
(c) the provision by the administrator of any Plan of a notice of intent to
terminate such Plan, pursuant to Section 4041(a)(2) of ERISA (including any
such notice with respect to a plan amendment referred to in Section 4041(e) of
ERISA); (d) the cessation of operations at a facility of AYE or any of its
Subsidiaries or any ERISA Affiliate in the circumstances described in Section
4062(e) of ERISA; (e) the withdrawal by AYE or any of its Subsidiaries or any
ERISA Affiliate from a Multiple
16
Employer Plan during a plan year for which it was a substantial employer, as
defined in Section 4001(a)(2) of ERISA; (f) a lien has been imposed under
Section 302(f) of ERISA with respect to any Plan; (g) the adoption of an
amendment to a Plan requiring the provision of security to such Plan pursuant
to Section 307 of ERISA; or (h) the institution by the PBGC of proceedings to
terminate a Plan pursuant to Section 4042 of ERISA, or the occurrence of any
event or condition described in Section 4042 of ERISA that constitutes grounds
for the termination of, or the appointment of a trustee to administer, such
Plan, provided, however, that the occurrence of the event or condition
described in Section 4042(a)(4) of ERISA shall be an ERISA Event only if the
PBGC has notified AYE, any Subsidiary of AYE or any ERISA Affiliate that it
intends to institute proceedings to terminate a Plan pursuant to such Section.
"Eurocurrency Liabilities" has the meaning specified in Regulation D of
the Board of Governors of the Federal Reserve System, as in effect from time
to time.
"Eurodollar Lending Office" means, with respect to any Lender Party, the
office of such Lender Party specified as its "Eurodollar Lending Office"
opposite its name on Schedule I or in the Assignment and Acceptance pursuant
to which it became a Lender Party (or, if no such office is specified, its
Domestic Lending Office), or such other office of such Lender Party as such
Lender Party may from time to time specify to AYE and the Administrative
Agent.
"Eurodollar Rate" means, with respect to any Interest Period for all
Eurodollar Rate Advances comprising part of the same Borrowing, the rate per
annum obtained by dividing (a) LIBOR for such Interest Period by (b) a
percentage equal to 1.00 minus the Eurodollar Rate Reserve Percentage.
"Eurodollar Rate Advance" means an Advance that bears interest as
provided in Section 2.07(a)(ii).
"Eurodollar Rate Reserve Percentage" for any Interest Period for all
Eurodollar Rate Advances comprising part of the same Borrowing means the
reserve percentage applicable two Business Days before the first day of such
Interest Period under regulations issued from time to time by the Board of
Governors of the Federal Reserve System (or any successor) for determining the
maximum reserve requirement (including any emergency, supplemental or other
marginal reserve requirement) for a member bank of the Federal Reserve System
in New York City with respect to liabilities or assets consisting of or
including Eurocurrency Liabilities (or with respect to any other category of
liabilities that includes deposits by reference to which the interest rate on
Eurodollar Rate Advances is determined) having a term equal to such Interest
Period.
"Event of Default" has the meaning specified in Section 6.01.
"Existing AYE Debt" means the aggregate principal amount outstanding
under the Existing Credit Agreement.
"Existing Credit Agreement" has the meaning specified in Preliminary
Statement (1) of this Agreement.
17
"Existing Debt" means all Debt, as of the date hereof, of AYE and its
Subsidiaries.
"Existing Lenders" has the meaning specified in Preliminary Statement
(1) of this Agreement.
"Existing L/Cs" means the letters of credit identified in Schedule
1.01(a).
"Facility" means the Term Facility or the Revolving Facility, as the
context may require.
"Fair Market Value" means with respect to any Asset the price at which a
willing buyer would purchase such Asset from a willing seller, assuming that
both buyer and seller are rational and have reasonable knowledge of all
relevant facts.
"Federal Funds Rate" means, for any period, a fluctuating interest rate
per annum equal for each day during such period 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 for such day
(or, if such day is not a Business Day, for the next preceding Business Day)
by the Federal Reserve Bank of New York, or, if such rate is not so published
for any day that is a Business Day, the average of the quotations for such day
for such transactions received by the Administrative Agent from three Federal
funds brokers of recognized standing selected by it.
"Fee Letter" means the fee letter, if any, between AYE and the
Administrative Agent.
"FERC" means the Federal Energy Regulatory Commission.
"Final Maturity Date" means the earlier of (a) the date of termination
in whole of the Commitments and the L/C Obligations pursuant to Section 2.05
or 6.01, and (b) the fifth anniversary of the Closing Date.
"Fiscal Year" means a fiscal year of AYE and its Consolidated
Subsidiaries ending on December 31 in any calendar year.
"FMB Debt" means, with respect to (a) MPC, Debt under bonds issued
pursuant to the indenture dated as of August 1, 1945, between MPC and
Citibank, N.A. (ultimate successor to City Bank Farmers Trust Company), as
trustee, as amended and supplemented by various supplemental indentures from
time to time, and (b) PEC, Debt under bonds issued pursuant to the indenture
dated as of October 1, 1944 between PEC, JPMorgan Chase Bank (ultimate
successor to Chemical Bank & Trust Company), as corporate trustee, and Xxxxxx
X. Xxxxx, as individual trustee, as amended and supplemented by various
supplemental indentures from time to time.
"Form 10-K" has the meaning set forth in Section 4.01(g).
18
"Fronting Fee" has the meaning specified in Section 2.08(c).
"Fund" means any Person (other than a natural person) that is (or will
be) engaged in making, purchasing, holding or otherwise investing in
commercial loans and similar extensions of credit in the ordinary course of
its business.
"GAAP" has the meaning specified in Section 1.02(c).
"Governmental Approvals" has the meaning specified in Section 4.01(c).
"Governmental Authority" means any national, state, county, city, town,
village, municipal or other de jure or de facto government department,
commission, board, bureau, agency, authority or instrumentality of a country
or any political subdivision thereof or any regional transmission authority
organized pursuant to federal law, and any Person exercising executive,
legislative, judicial, regulatory or administrative functions of or pertaining
to any of the foregoing entities, including all commissions, boards, bureaus,
arbitrators and arbitration panels, and any authority or other Person
controlled by any of the foregoing.
"Granting Lender" has the meaning specified in Section 8.07(h).
"Hazardous Materials" means (a) petroleum or petroleum products,
by-products or breakdown products, radioactive materials, asbestos-containing
materials, polychlorinated biphenyls and radon gas and (b) any other
chemicals, materials or substances designated, classified or regulated as
hazardous or toxic or as a pollutant or contaminant under any Environmental
Law.
"Hedge Agreements" means (a) any and all rate swap transactions, basis
swaps, credit derivative transactions, forward rate transactions, commodity
swaps, commodity options, forward commodity contracts, any other Commodity
Hedge Agreements, equity or equity index swaps or options, bond or bond price
or bond index swaps or options or forward bond or forward bond price or
forward bond index transactions, interest rate options, forward foreign
exchange transactions, cap transactions, floor transactions, collar
transactions, currency swap transactions, cross-currency rate swap
transactions, currency options, spot contracts, or any other similar
transactions or any combination of the foregoing (including any option to
enter into any of the foregoing), whether or not any such transaction is
governed by or subject to any master agreement, and (b) any and all
transactions of any kind, and the related confirmations, which are subject to
the terms and conditions of, or are governed by, any form of master agreement
published by the International Swaps and Derivative Association, Inc., any
International Foreign Exchange Master Agreement or any other master agreement
(including such master agreement, together with any related schedules, a
"Master Agreement") including any such obligations or liabilities under any
Master Agreement.
"Honor Date" has the meaning specified in Section 2.03(b)(i).
"Indemnified Costs" has the meaning specified in Section 7.05(a).
19
"Indemnified Party" has the meaning specified in Section 8.04(b).
"Information Memorandum" means the information memorandum dated April,
2006 used by the Lead Arrangers in connection with the syndication of the
Facilities.
"Initial Borrowing" means the initial Borrowing to be made on the
Closing Date which shall be or is comprised of (a) Revolving Advances and (b)
L/C Credit Extensions pursuant to Section 2.01(c).
"Initial Issuing Bank" has the meaning specified in the recital of
parties to this Agreement.
"Initial Lender Parties" has the meaning specified in the recital of
parties to this Agreement.
"Initial Lenders" has the meaning specified in the recital of parties to
this Agreement.
"Insolvency Proceeding" means, with respect to any Person, (a) any
proceeding which shall be instituted against such Person seeking to adjudicate
it a bankrupt or insolvent, or seeking liquidation, winding up,
reorganization, arrangement, adjustment, protection, relief, or composition of
it or its debts under any law relating to bankruptcy, insolvency or
reorganization or relief of debtors, or seeking the entry of an order for
relief or the appointment of a receiver, trustee or other similar official for
it or for any substantial part of its property and either such proceeding
shall remain undismissed or unstayed for a period of 60 consecutive days or
the entry by any competent Governmental Authority of any jurisdiction or a
court having jurisdiction in the premises of a decree or order approving or
ordering any of the actions sought in such proceeding (including the entry of
an order for relief against, or the appointment of a receiver, trustee,
custodian or other similar official for, it or any substantial part of its
property); or (b) commencement by such Person of a voluntary case or
proceeding under any applicable bankruptcy, insolvency, reorganization or
other similar law or of any other case or proceeding to be adjudicated as
bankrupt or insolvent, or the consent by such Person to the entry of a decree
or order for relief in respect of such Person in an involuntary case or
proceeding under any applicable bankruptcy, insolvency, reorganization or
other similar law or to the commencement of any bankruptcy or insolvency case
or proceeding against such Person, or the filing by such Person of a petition
or answer or consent seeking reorganization or relief under any Applicable
Law; or consent by such Person to the filing of such petition or to the
appointment of or taking possession by a custodian, receiver, liquidator,
assignee, trustee, sequestrator or other similar official of such Person or of
any substantial part of the property of such Person, or the making by such
Person of an assignment for the benefit of creditors or any other marshalling
of the assets and liabilities of such Person, or the admission by such Person
in writing of its inability to pay its debts generally as they become due, or
the taking of corporate action by such Person in furtherance of any such
action.
20
"Intangible Transition Property" has the meaning specified in Section
5.02(e)(viii)(A).
"Interest Coverage Ratio" means at any date of determination, the ratio
of (a) AYE Funds Flow to (b) AYE Interest Expense for (i) if four or more
consecutive fiscal quarters have elapsed since July 1, 2005, for the period of
four consecutive fiscal quarters ending on such date, taken as one accounting
period or (ii) if less than four consecutive fiscal quarters have elapsed
since July 1, 2005, (A) with respect to AYE Funds Flow, the period of four
consecutive fiscal quarters ending on such date, taken as one accounting
period and (B) with respect to AYE Interest Expense, for the fiscal quarters
that have elapsed since July 1, 2005, taken as one accounting period, provided
that, in the case of clause (B) only, AYE Interest Expense shall be multiplied
by the Annualization Factor.
"Interest Period" means, for each Eurodollar Rate Advance comprising
part of the same Borrowing to any Borrower, the period commencing on the date
of such Eurodollar Rate Advance or the date of the Conversion of any Base Rate
Advance into such Eurodollar Rate Advance, and ending on the last day of the
period selected by such Borrower pursuant to the provisions below and,
thereafter, each subsequent period commencing on the last day of the
immediately preceding Interest Period and ending on the last day of the period
selected by such Borrower pursuant to the provisions below. The duration of
each such Interest Period shall be one, two, three or six months or, if
available at the time of selection to all Lenders owed any of the relevant
Advances, nine or twelve months, as the relevant Borrower may, upon notice
received by the Administrative Agent not later than 11:00 a.m. (New York City
time) on the third Business Day prior to the first day of such Interest
Period, select; provided that:
(a) no Borrower may select any Interest Period with
respect to any Eurodollar Rate Advance that ends after the date
specified in clause (b) of the definition of "Final Maturity
Date";
(b) no Borrower may select any Interest Period if, after
giving effect to such selection, there are more than fifteen
different Interest Periods applicable to all Eurodollar Rate
Advances then outstanding;
(c) 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
(d) whenever the first day of any Interest Period occurs
on a day of an initial calendar month for which there is no
numerically corresponding day in the calendar month that
succeeds such initial calendar month by the number of months
equal to the number of months in such Interest Period, such
Interest Period shall end on the last Business Day of such
succeeding calendar month.
21
"Intralinks" means the digital internet workspace located at
xxxx://xxx.xxxxxxxxxx.xxx.
"Investment" in any Person means any loan or advance to such Person, any
purchase or other acquisition of any Equity Interests or Debt or the Assets
comprising a division or business unit or a substantial part or all of the
business of such Person, any capital contribution to such Person or any other
direct or indirect investment in such Person, including any acquisition by way
of a merger or consolidation and any arrangement pursuant to which the
investor incurs Debt of the types referred to in clause (i) or (j) of the
definition of "Debt" in respect of such Person. Notwithstanding the foregoing,
any intercompany loan or account receivable due to AYE or any of its
Subsidiaries (a "payee") by AYE or any of its Subsidiaries (a "payor"), as the
case may be, with respect to an account payable of a payor and owed to a
Person other than AYE or any of its Subsidiaries that is payable within 90
days of being incurred arising in the ordinary course of such payor's business
and not more than 90 days past due and not subject to a Contest shall not
constitute an Investment by such payee in such payor.
"ISDA Master Agreement" means the Master Agreement (Multicurrency-Cross
Border) published by the International Swap and Derivatives Association, Inc.
"ISP" means, with respect to any Letter of Credit, the "International
Standby Practices 1998" published by the Institute of International Banking
Law & Practice (or such later version thereof as may be in effect at the time
of issuance of such Letter of Credit).
"Issuer Documents" means, with respect to any Letter of Credit, the
Letter of Credit Application and any other document, agreement and instrument
entered into by any Issuing Bank and the Related Borrower or in favor of any
Issuing Bank and relating to any such Letter of Credit.
"Issuing Bank" means the Initial Issuing Bank, any Revolving Lender
issuing Letters of Credit hereunder and each Person that shall become an
Issuing Bank hereunder pursuant to Section 8.07.
"Joint Venture" means, with respect to any Person, at any date, any
other Person in whom such Person directly or indirectly holds an Investment
consisting of an Equity Interest and whose financial results would not be
considered under GAAP with the financial results of such Person on the
Consolidated financial statements of such Person, if such statements were
prepared in accordance with GAAP as of such date.
"L/C Advance" means, with respect to each Revolving Lender, such
Revolving Lender's funding of its participation in any L/C Borrowing in
accordance with its Pro Rata Share.
"L/C Borrowing" means an extension of credit resulting from a drawing
under any Letter of Credit which has not been reimbursed on the date when made
or refinanced as a Borrowing.
22
"L/C Credit Extension" means any AYE L/C Credit Extension, AESC Indirect
L/C Credit Extension or AESC Direct L/C Credit Extension.
"L/C Obligations" means any of the AYE L/C Obligations, AESC Indirect
L/C Obligations or AESC Direct L/C Obligations.
"Lead Arrangers" means CGMI and CSCI, not in their respective individual
capacities except as expressly set forth herein but solely as lead arrangers.
"Lender" means each Initial Lender and each other Person that shall
become a Lender hereunder pursuant to Section 8.07 for so long as such Initial
Lender or Person, as the case may be, shall be a party to this Agreement.
"Lender Parties" means the Lenders and the Issuing Banks.
"Letter of Credit" means any AYE Letter of Credit, AESC Indirect Letter
of Credit or AESC Direct Letter of Credit.
"Letter of Credit Application" means an application and agreement for
the issuance or amendment of a Letter of Credit to be issued hereunder by any
Issuing Bank in the form from time to time in use by such Issuing Bank.
"Letter of Credit Expiration Date" means the day that is five Business
Days prior to the date specified in clause (b) of the definition of "Final
Maturity Date" (or, if such day is not a Business Day, the next preceding
Business Day).
"Letter of Credit Fee" has the meaning specified in Section 2.08(b).
"Leverage Ratio" means, as of any date of determination, the ratio of
(a) Debt for Borrowed Money of AYE to (b) AYE Funds Flow for the period of
four consecutive fiscal quarters ending on such date, taken as one accounting
period.
"LIBOR" means, for any applicable Interest Period with respect to all
Eurodollar Rate Advances comprising part of the same Borrowing, the British
Bankers' Association Interest Settlement Rate per annum for deposits in
Dollars for a period equal to such Interest Period appearing on the display
designated as Page 3750 on the Dow Xxxxx Markets Service (or such other page
on that service or such other service designated by the British Bankers'
Association for the display of such Association's Interest Settlement Rates
for Dollar deposits) as of 11:00 a.m. (London, England time) on the day that
is two Business Days prior to the first day of the Interest Period or, if such
Page 3750 is unavailable for any reason at such time, the rate which appears
on the Reuters Screen LIBOR 01 Page as of such date and such time; provided
that if the Administrative Agent determines that the relevant foregoing
sources are unavailable for the relevant Interest Period, LIBOR shall mean the
rate of interest determined by the Administrative Agent to be the average
(rounded upward, if necessary, to the nearest 1/1,000th of 1%) of the rates
per annum at which deposits in Dollars are offered to the Administrative Agent
two Business Days preceding the first day of such Interest Period by leading
banks in the London interbank market as of 10:00 a.m. (New York City time) for
delivery on the first
23
day of such Interest Period, for the number of days comprised therein and in
an amount comparable to the amount of the Eurodollar Rate Advance of CNAI (in
its capacity as a Lender).
"Lien" means any lien, mortgage, deed of trust, pledge, security
interest or other charge or encumbrance of any kind, including the lien or
retained security title of a conditional vendor and any easement, right of way
or other encumbrance on title to real property.
"Litigation Proceeds" means any cash received by or paid to any Person
in connection with any final settlement or judgment of any action, suit,
litigation or similar proceeding involving such Person.
"Loan Documents" means this Agreement, the Notes, the Fee Letter and the
Issuer Documents.
"Margin Stock" has the meaning specified in Regulation U of the Board of
Governors of the Federal Reserve System, as in effect from time to time.
"Material Adverse Change" means any material adverse change in the
business, financial condition, operations or properties of (a) AYE or (b) AYE
and its Subsidiaries, taken as a whole.
"Material Adverse Effect" means a material adverse effect on (a) the
business, financial condition, operations or properties of (i) AYE or (ii) AYE
and its Subsidiaries, taken as a whole, (b) the rights and remedies of any
Lender Party under any Loan Document or (c) the ability of any Borrower to
perform its Obligations under any Loan Document to which it is or is to be a
party.
"Material Governmental Approvals" means those Governmental Approvals
listed on Schedule 4.01(c).
"Xxxxxxx Xxxxx Litigation" means that litigation arising out of that
complaint filed under the caption Xxxxxxx Xxxxx & Co., Inc., et al. v.
Allegheny Energy, Inc., and Allegheny Energy, Inc., et al. x. Xxxxxxx Xxxxx &
Co., Inc., et al. (02 CV 7689 (HB)).
"Moody's" means Xxxxx'x Investors Service, Inc.
"MPC" means Monongahela Power Company, an Ohio Corporation.
"MPC Preferred Stock" means all preferred stock issued by MPC from time
to time.
"Multiemployer Plan" means a multiemployer plan, as defined in Section
4001(a)(3) of ERISA, to which AYE or any of its Subsidiaries or any ERISA
Affiliate is making or accruing an obligation to make contributions, or has
within any of the preceding five plan years made or accrued an obligation to
make contributions.
24
"Multiple Employer Plan" means a single employer plan, as defined in
Section 4001(a)(15) of ERISA, that (a) is maintained for employees of AYE or
any of its Subsidiaries or any ERISA Affiliate and at least one Person other
than AYE, its Subsidiaries and the ERISA Affiliates or (b) was so maintained
and in respect of which AYE and any of its Subsidiaries or any ERISA Affiliate
could have liability under Section 4064 or 4069 of ERISA in the event such
plan has been or were to be terminated.
"Net Cash Proceeds" means, with respect to any sale, lease, transfer or
other disposition of any Asset or the sale or issuance of any Equity Interests
(including any capital contribution) by any Person, the aggregate amount of
cash received from time to time (whether as initial consideration or through
payment or disposition of deferred consideration or received from escrow) by
or on behalf of such Person in connection with such transaction after
deducting therefrom only (without duplication) the following (to the extent
directly and primarily relating to such transaction): (a) reasonable and
customary brokerage commissions, underwriting fees and discounts, legal,
consultant and advisor fees, finder's fees and other similar fees and
commissions, (b) the amount of taxes (or amounts owing pursuant to the Tax
Allocation Agreement) payable in connection with or as a result of such
transaction, and (c) in the case of any sale, lease, transfer or other
disposition of any asset or property, (i) the amount of (A) any Debt secured
by a prior Lien on the Asset which is the subject of such sale, lease,
transfer or other disposition or (B) Debt outstanding under the Pollution
Control Bonds that is, in either case, repaid, redeemed or defeased upon such
disposition as required pursuant to the terms of (1) the agreement or
instrument governing such Debt or (2) any undertaking or agreement of any
Borrower made on or prior to February 21, 2003 in favor of the issuer of any
guaranty, surety bond or insurance policy issued for the benefit of the
holders of such Debt, including, each of the consents, dated February 21,
2003, entered into among (y) AESC, PEC and MBIA Insurance Corporation and (z)
AESC, WPPC and MBIA Insurance Corporation, (ii) the costs associated (in AYE's
best estimate) with terminating all Hedge Agreements, if any, entered into in
connection with such Asset, which Hedge Agreements are not being transferred
as part of such sale, lease, transfer or other disposition, but only to the
extent that the amounts so deducted are, at the time or within a reasonable
time (not to exceed ten days) of receipt of such cash, actually paid to a
Person that is not an Affiliate of such Person or any Affiliate of AYE and are
properly attributable to such transaction or to the Asset that is the subject
thereof and (iii) any amounts received from funds that were held in escrow as
of the Closing Date with respect to any sale, lease, transfer or other
disposition of any Asset consummated prior to the Closing Date; provided that,
in the case of taxes or termination costs that are deductible under clause (b)
or (c)(ii) above but for the fact that, at the time of receipt of such cash,
such amounts have not been actually paid or are not then payable, such Person
may deduct an amount (the "Reserved Amount") equal to the amount reserved in
accordance with GAAP for such Person's reasonable estimate of such amounts,
other than taxes for which such Person is indemnified; provided further that,
at the time such amounts are paid, an amount equal to the amount, if any, by
which the Reserved Amount for such amounts exceeds the amount of such amounts
actually paid shall constitute "Net Cash Proceeds" of the type for which such
amounts were reserved for all purposes hereunder.
"Non-Extension Notice Date" has the meaning specified in Section
2.03(a)(iii).
25
"Note" means a Revolving Note or a Term Note, as the context may
require.
"Notice of Borrowing" has the meaning specified in Section 2.02(a).
"Notice of Conversion/Continuation" has the meaning specified in Section
2.10(a)(ii).
"NPL" means the National Priorities List under CERCLA.
"Obligation" means, with respect to any Person, any payment, performance
or other obligation of such Person of any kind, including any liability of
such Person on any claim, whether or not the right of any creditor to payment
in respect of such claim is reduced to judgment, liquidated, unliquidated,
fixed, contingent, matured, disputed, undisputed, legal, equitable, secured or
unsecured, and whether or not such claim is discharged, stayed or otherwise
affected by any proceeding referred to in Section 6.01(g). Without limiting
the generality of the foregoing, the Obligations of any Borrower under the
Loan Documents include (a) the obligation of such Borrower to pay principal,
interest, Letter of Credit commissions, charges, expenses, fees, attorneys'
and consultant's fees and disbursements, indemnities and other amounts payable
by such Borrower under any Loan Document and (b) the obligation of such
Borrower to reimburse any amount in respect of any of the foregoing that any
Lender Party, in its sole discretion, may elect to pay or advance on behalf of
such Borrower.
"OECD" means the Organization for Economic Cooperation and Development.
"Officer's Certificate" means, with respect to any Person, a certificate
signed by a Responsible Officer of such Person.
"Other Taxes" has the meaning specified in Section 2.13(b).
"Outstanding Amount" means (a) with respect to the Revolving Facility on
any date, the aggregate outstanding principal amount thereof after giving
effect to any Revolving Borrowings and prepayments of the Revolving Facility
occurring on such date; and (b) with respect to any L/C Obligations on any
date, the amount of such L/C Obligations on such date after giving effect to
any relevant L/C Credit Extension occurring on such date and any other changes
in the aggregate amount of such L/C Obligations as of such date, including as
a result of any reimbursements of outstanding unpaid drawings under any
relevant Letters of Credit or any reductions in the maximum amount available
for drawing under any relevant Letters of Credit taking effect on such date.
"PA Report" means the Independent Market Expert's Report for the PJM,
MISO, and SERC-TVA Regions, dated June 24, 2005, prepared by PA Consulting
Group.
"PBGC" means the Pension Benefit Guaranty Corporation (or any
successor).
"PEC" means The Potomac Edison Company, a Maryland and Virginia
corporation.
26
"Permitted Liens" means such of the following as to which no
enforcement, collection, execution, levy or foreclosure proceeding shall have
been commenced: (a) Liens for taxes, assessments and governmental charges or
levies to the extent not required to be paid under Section 5.01(d); (b) Liens
imposed by law, such as materialmen's, mechanics', carriers', workmen's and
repairmen's Liens and other similar Liens arising in the ordinary course of
business securing obligations that are not overdue for a period of more than
30 days, or which are subject to Contest; (c) Liens or deposits to secure
obligations under workers' compensation laws or similar legislation or to
secure public or statutory obligations; (d) deposits to secure the performance
of bids, leases (other than Capitalized Leases), trade contracts, public or
statutory obligations (including environmental, municipal and public utility
commission obligations under Applicable Laws), surety bonds (other than bonds
related to judgments or litigation), performance bonds and other obligations
of a like nature incurred in the ordinary course of business; (e) Liens
securing judgments for the payment of money not constituting an Event of
Default under Section 6.01(h) or securing appeal or other surety bonds related
to such judgments; (f) zoning restrictions, easements, rights of way and other
encumbrances on title to real property that do not render title to the
property encumbered thereby unmarketable or materially adversely affect the
use of such property for its present purposes; (g) liens on cash deposits in
the nature of a right of setoff, banker's lien, counterclaim or netting of
cash amounts owed arising in the ordinary course of business on deposit
accounts, commodity accounts or securities accounts; (h) financing statements
filed on a precautionary basis in respect of operating leases to the extent
such lease is otherwise permitted under the terms of this Agreement; provided
that no such financing statement extends to or refers to as collateral, any
Assets which are not subject to such operating lease; and (i) rights of first
refusal, options or other contractual rights or obligations to sell, assign or
otherwise dispose of any Asset or interest therein which rights of first
refusal, option or contractual right is in connection with an Asset sale or
disposition permitted under Section 5.02(d) or 5.02(e).
"Permitted Refinancing Debt" means Debt issued or incurred (including by
means of the extension or renewal of existing Debt) to refinance, refund,
extend, renew or replace existing Debt ("Refinanced Debt") concurrently with,
or within 90 days after, the issuance or incurrence of such Debt (so long as
all proceeds from the issuance of such Debt (net of reasonable and customary
transaction fees, costs and expenses (including fees of legal counsel)) are
held as a cash deposit in an account of any Borrower or invested and
maintained by such Borrower solely in Cash Equivalents until applied to repay
the Refinanced Debt); provided that with respect to AYE and its Regulated
Subsidiaries (a) the principal amount of such refinancing, refunding,
extending, renewing or replacing Debt is not greater than the principal amount
of such Refinanced Debt plus the amount of any premiums or penalties and
accrued and unpaid interest paid thereon and reasonable fees and expenses, in
each case associated with such refinancing, refunding, extension, renewal or
replacement, (b) such refinancing, refunding, extending, renewing or replacing
Debt has a scheduled maturity date that is at least six calendar months after
the Final Maturity Date and does not require any scheduled amortization or, if
such Debt is not FMB Debt, mandatory prepayments thereof (other than pursuant
to mandatory prepayment provisions which are substantially identical to those
required in respect of such Refinanced Debt) prior to such date, (c) the
obligors in respect of such
27
Refinanced Debt immediately prior to such refinancing, refunding, extending,
renewing or replacing and any additional Person are the only obligors on such
refinancing, refunding, extending, renewing or replacing Debt, (d) such
refinancing, refunding, extending, renewing or replacing Debt, if it is not
FMB Debt, contains covenants and events of default which, taken as a whole,
are determined in good faith by a Responsible Officer of AYE to be customary
for similar issuances of Debt by issuers similar in credit rating or standing
as that applicable to AYE, and (e) if the Refinanced Debt was outstanding
under a revolving credit facility, the availability under such revolving
credit facility shall be permanently reduced by an amount equal to the
aggregate principal amount of such Refinanced Debt.
"Permitted Securitization" means (a) a Stranded Cost Securitization, (b)
an Environmental Control Property Securitization or (c) any other
securitization by a Regulated Subsidiary of rights to payments or other
payment intangibles (whether constituting accounts, chattel paper,
instruments, general intangibles or otherwise, and including the right to
payment of any interest or finance charges) from customers of such Regulated
Subsidiary, which in the case of clause (c), such rights (i) arise after the
date of this Agreement and (ii) are identified in the accounting records of
such Regulated Subsidiary as accounts receivable, regulatory assets or other
intangible assets associated with the right to receive such payments over time
in connection with the sale and/or delivery of electricity and any services
related thereto, and which, in the case of clauses (a), (b) and (c), are
permitted by Section 5.02(e)(viii).
"Person" means an individual, partnership, corporation (including a
business or statutory trust), limited liability company, joint stock company,
trust, unincorporated association, joint venture or other entity, or a
government or any political subdivision or agency thereof.
"Plan" means a Single-Employer Plan or a Multiple Employer Plan.
"Platform" has the meaning specified in Section 8.02(c).
"Pollution Control Bond Indentures" means (a) the Trust Indenture dated
as of April 15, 1992 between the County Commission of Xxxxxxxx County, West
Virginia and X.X. Xxxxxx Trust Company, National Association (formerly Chase
Manhattan Trust Company, National Association, successor trustee to Mellon
Bank, N.A.), as Trustee, providing for Solid Waste Disposal Revenue Bonds
(West Penn Power Company Xxxxxxxx Station Project), (b) the Trust Indenture
dated as of November 1, 0000 xxxxxxx Xxxxxxxxx Xxxxxx, Xxxx Xxxxxxxx and X.X.
Xxxxxx Trust Company, National Association (formerly Chase Manhattan Trust
Company, National Association, successor trustee to Mellon Bank, N.A.), as
Trustee, providing for Pollution Control Revenue Bonds (West Penn Power
Company Xxxxxxxxx Station Project), (c) the Trust Indenture dated as of
December 1, 1980 between Washington County Industrial Development Authority
and X.X. Xxxxxx Trust Company, National Association (formerly Chase Manhattan
Trust Company, National Association, successor trustee to Mellon Bank, N.A.),
as Trustee, providing for Pollution Control Revenue Bonds (West Penn Power
Company Xxxxxxxx Station Project), (d) the Trust Indenture dated as of April
15, 1983 between the County Commission of Monongalia County, West Virginia and
X.X. Xxxxxx Trust Company, National Association (formerly Chase Manhattan
Trust Company, National Association, successor trustee to Mellon Bank, N.A.),
as Trustee, providing for Pollution Control Revenue Bonds (West Penn Power
Company Fort Xxxxxx Station Project), (e) the Trust Indenture dated as of
February 1, 1977 between Xxxxxx County Industrial Development Authority and
X.X. Xxxxxx Trust Company, National Association (formerly Chase Manhattan
Trust Company, National Association, successor trustee to Mellon Bank, N.A.),
as Trustee, providing for Pollution Control Revenue Bonds (West Penn Power
Company Xxxxxxxx'x Ferry Project), (f) the Trust Indenture dated as of April
15, 1992 between the County Commission of Xxxxxxxx County, West Virginia and
X.X. Xxxxxx Trust Company, National Association (formerly Chase Manhattan
Trust Company, National Association, successor trustee to Mellon Bank, N.A.),
as Trustee, providing for Solid Waste Disposal Revenue Bonds (The Potomac
Edison Company Xxxxxxxx Station Project), (g) the Trust Indenture dated as of
November 1, 0000 xxxxxxx Xxxxxxxxx Xxxxxx, Xxxx Xxxxxxxx and X.X. Xxxxxx Trust
Company, National Association (formerly Chase Manhattan Trust Company,
National Association, successor trustee to Mellon Bank, N.A.), as Trustee,
providing for Pollution Control Revenue Bonds (The Potomac Edison Company
Xxxxxxxxx Station Project), (h) the Trust Indenture dated as of April 15, 1983
between the County
00
Xxxxxxxxxx xx Xxxxxxxxxx Xxxxxx, Xxxx Xxxxxxxx and X.X. Xxxxxx Trust Company,
National Association (formerly Chase Manhattan Trust Company, National
Association, successor trustee to Mellon Bank, N.A.), as Trustee, providing
for Pollution Control Revenue Bonds (The Potomac Edison Company Fort Xxxxxx
Station Project), (i) the Trust Indenture dated as of February 1, 1977 between
Xxxxxx County Industrial Development Authority and X.X. Xxxxxx Trust Company,
National Association (formerly Chase Manhattan Trust Company, National
Association, successor trustee to Mellon Bank, N.A.), as Trustee, providing
for Pollution Control Revenue Bonds (Monongahela Power Company Xxxxxxxx'x
Ferry Project), (j) the Trust Indenture dated as of November 1, 0000 xxxxxxx
Xxxxxxxxx Xxxxxx, Xxxx Xxxxxxxx and X.X. Xxxxxx Trust Company, National
Association (formerly Chase Manhattan Trust Company, National Association,
successor trustee to Mellon Bank, N.A.), as Trustee, providing for Pollution
Control Revenue Bonds (Monongahela Power Company Xxxxxxxxx Station Project),
(k) the Trust Indenture dated as of April 15, 1983 between the County
Commission of Monongalia County, West Virginia and X.X. Xxxxxx Trust Company,
National Association (formerly Chase Manhattan Trust Company, National
Association, successor trustee to Mellon Bank, N.A.), as Trustee, providing
for Pollution Control Revenue Bonds (Monongahela Power Company Fort Xxxxxx
Station Project), and (l) Trust Indenture dated as of April 15, 1992 between
the County Commission of Xxxxxxxx County, West Virginia and X.X. Xxxxxx Trust
Company, National Association (formerly Chase Manhattan Trust Company,
National Association, successor trustee to Mellon Bank, N.A.), as Trustee,
providing for Solid Waste Disposal Revenue Bonds (Monongahela Power Company
Xxxxxxxx Station Project).
"Pollution Control Bonds" means all notes, bonds and other instruments
evidencing Debt owed by any Borrower in respect of Debt issued pursuant to the
Pollution Control Bond Indentures.
29
"Preferred Interests" means, with respect to any Person, Equity
Interests issued by such Person that are entitled to a preference or priority
over any other Equity Interests issued by such Person upon any distribution of
such Person's Assets, whether by dividend or upon liquidation.
"Pro Rata Share" means, with respect to each Revolving Lender at any
time, a fraction (expressed as a percentage, carried out to the ninth decimal
place), the numerator of which is the amount of the Revolving Commitment of
such Revolving Lender and the denominator of which is the amount of the
Revolving Facility; provided that if the commitment of each Revolving Lender
to make Revolving Advances and the obligation of each Issuing Bank to make L/C
Credit Extensions have been terminated pursuant to Section 2.05 or 6.01, then
the Pro Rata Share of each Revolving Lender shall be determined based on the
Pro Rata Share of such Revolving Lender immediately prior to such termination
and after giving effect to any subsequent assignments made pursuant to the
terms hereof. The initial Pro Rata Share of each Revolving Lender is set forth
opposite the name of such Revolving Lender on Schedule I or in the Assignment
and Assumption pursuant to which such Lender becomes a party hereto, as
applicable.
"Public Debt Rating" means, as of any date, the higher rating that has
been most recently announced by either S&P or Xxxxx'x, as the case may be, for
any class of non-credit enhanced long-term senior unsecured debt issued by
AYE; provided that (a) if only one of S&P and Xxxxx'x shall have in effect a
Public Debt Rating or if neither S&P nor Xxxxx'x shall have in effect a Public
Debt Rating, the Applicable Margin and Commitment Fee Rate will be determined
in accordance with Level 6 under the definition of "Applicable Margin" and
"Commitment Fee Rate", respectively; (b) if such ratings established by S&P
and Xxxxx'x shall differ by one level, the Applicable Margin and Commitment
Fee Rate shall be determined in accordance with the higher rating; (c) if such
ratings established by S&P and Xxxxx'x shall differ by two or more levels, the
Applicable Margin and Commitment Fee Rate shall be based upon the rating which
is one rating level higher than the lower of the ratings established by S&P
and Xxxxx'x; (d) if any rating established by S&P or Xxxxx'x shall be changed,
such change shall be effective as of the date on which such change is first
announced publicly by the rating agency making such change; and (e) if S&P or
Xxxxx'x shall change the basis on which ratings are established, each
reference to the Public Debt Rating announced by S&P or Xxxxx'x, as the case
may be, shall refer to the then equivalent rating by S&P or Xxxxx'x, as the
case may be. If the rating system of Xxxxx'x or S&P applicable to any class of
non-credit enhanced long-term senior secured or unsecured debt shall change in
any material respect, or if either such rating agency shall cease to be in the
business of rating corporate debt obligations, AYE and the Required Lenders
shall negotiate in good faith to amend this definition to reflect such changed
rating system or the unavailability of ratings from such rating agency and
pending the effectiveness of any such amendment, the Applicable Margin and the
Commitment Fee Rate shall be determined by reference to the ratings most
recently in effect prior to such change or cessation.
"Public Debt Rating (AESC)" means, as of any date, the higher rating
that has been most recently announced by either S&P or Xxxxx'x, as the case
may be, for any class of non-credit enhanced long-term senior secured debt
(or, if the lenders under the
30
AESC Credit Agreement are no longer secured, the
non-credit enhanced long-term senior unsecured debt) issued by AESC; provided
that (a) if such ratings established by S&P and Xxxxx'x shall differ by one
level, the Public Debt Rating (AESC) shall be deemed to be the higher of such
ratings; (b) if such ratings established by S&P and Xxxxx'x shall differ by
two or more levels, the Public Debt Rating (AESC) shall be deemed to be the
rating which is one rating level higher than the lower of the ratings
established by S&P and Xxxxx'x; (c) if any rating established by S&P or
Xxxxx'x shall be changed, such change shall be effective as of the date on
which such change is first announced publicly by the rating agency making such
change; and (d) if S&P or Xxxxx'x shall change the basis on which ratings are
established, each reference to the Public Debt Rating (AESC) announced by S&P
or Xxxxx'x, as the case may be, shall refer to the then equivalent rating by
S&P or Xxxxx'x, as the case may be. If the rating system of Xxxxx'x or S&P
applicable to any class of non-credit enhanced long-term senior secured or
unsecured debt shall change in any material respect, or if either such rating
agency shall cease to be in the business of rating corporate debt obligations,
AYE and the Required Lenders shall negotiate in good faith to amend this
definition to reflect such changed rating system or the unavailability of
ratings from such rating agency.
"Qualifying Obligation" means an Obligation in an aggregate principal
amount in excess of $5,000,000.
"Quarterly Date" means the last Business Day of March, June, September
and December, commencing with June 30, 2006.
"Redeemable" means, with respect to any Preferred Interests, any such
Preferred Interests that the issuer is required, pursuant to the terms and
conditions thereof, to redeem at a fixed or determinable date or dates,
whether by operation of a sinking fund or otherwise, or upon the occurrence of
a condition not solely within the control of the issuer.
"Reduction Amount" has the meaning specified in Section 2.06(b).
"Register" has the meaning specified in Section 8.07(e).
"Regulated Subsidiaries" means, collectively, MPC, PEC and WPPC and any
of their respective Subsidiaries.
"Related Borrower" means, with respect to (a) any Revolving Advance, the
Borrower to which such Advance is made, (b) any AYE Letter of Credit, AESC
Indirect Letter of Credit, AYE L/C Obligation or AESC Indirect L/C Obligation,
AYE and (c) any AESC Direct Letter of Credit or AESC Direct L/C Obligation,
AESC.
"Representatives" has the meaning specified in Section 8.12(a).
"Required Lenders" means, at any time, Lenders owed or holding at least
a majority in interest of the sum of (a) the Total Revolving Outstandings
(with the aggregate amount of each Lender's risk participation and funded
participation in L/C Obligations being deemed "held" by such Lender for
purposes of this definition) (if any)
31
at such time, plus (b) the aggregate Unused Commitments at such time, plus (c)
the aggregate outstanding principal amount of the Term Advances (if any) at
such time, plus (d) the aggregate amount of the Term Commitments (if any) at
such time.
"Required Revolving Lenders" means, at any time, Revolving Lenders owed
or holding at least a majority in interest of the sum of (a) the Total
Revolving Outstandings (with the aggregate amount of each Lender's risk
participation and funded participation in L/C Obligations being deemed "held"
by such Lender for purposes of this definition) (if any) at such time, plus
(b) the aggregate Unused Commitments (if any) at such time.
"Responsible Officer" means, with respect to any Person, the president,
any vice-president, the treasurer, the Chief Financial Officer or any other
Authorized Signatory of such Person.
"Restricted Payments" means, with respect to any Person, any (a)
dividends (in cash or property), purchase, redemption, retirement, defeasance
or other acquisition for value of any of its Equity Interests now or hereafter
outstanding, (b) return of capital to its stockholders, partners or members
(or the equivalent Persons thereof) as such, (c) distribution of assets,
Equity Interests, obligations or securities to its stockholders, partners or
members (or the equivalent Persons thereof) as such, and (d) setting apart of
money for a sinking or other analogous fund for, or any purchase, redemption,
retirement or other acquisition of any Equity Interests in such Person;
provided that, notwithstanding the foregoing, neither of the following shall
constitute a "Restricted Payment": (i) with respect to any Person, any
dividend or distribution payable solely with common stock of such Person or
with Equity Interests in such Person of the same class as those by reference
to which such Equity Interests are being distributed and (ii) any exchange of
outstanding Equity Interests of any Person for common stock of such Person or
for Equity Interests of the same class in such Person.
"Revolving Advance" has the meaning specified in Section 2.01(a).
"Revolving Borrowing" means a borrowing consisting of simultaneous
Revolving Advances of the same Type, made by the Revolving Lenders.
"Revolving Commitment" means, as to each Revolving Lender, its
obligation to: (a) make a Revolving Advance to any Borrower pursuant to
Section 2.01(a); and (b) purchase participations in L/C Obligations pursuant
to Sections 2.01(d), (e) and (f), in an aggregate principal amount at any one
time outstanding not to exceed the amount set forth opposite such Revolving
Lender's name on Schedule I under the caption "Revolving Commitment" or in the
Assignment and Assumption pursuant to which such Lender becomes a party
hereto, as applicable, as such amount may be adjusted from time to time in
accordance with this Agreement.
"Revolving Facility" means, at any time, the aggregate of the Revolving
Commitments at such time.
"Revolving Lender" means any Lender that has a Revolving Commitment.
32
"Revolving Note" means a promissory note of any Borrower payable to the
order of a Revolving Lender in substantially the form of Exhibit A-1,
evidencing the aggregate indebtedness of such Borrower to such Revolving
Lender resulting from Revolving Advances made by such Revolving Lender
hereunder to such Borrower.
"SEC" means the Securities and Exchange Commission.
"Securitization SPV" means any trust, partnership or other Person
established by a Regulated Subsidiary or any Subsidiary of a Regulated
Subsidiary to implement a Permitted Securitization.
"Senior Debt Obligations" means, without duplication, (a) the
Obligations of the Borrowers to pay principal and interest on the Advances
(including any interest accruing after the filing of a petition with respect
to, or the commencement of, any Insolvency Proceeding, whether or not a claim
for post-petition interest is allowed in such proceeding), and (b) any and all
commissions, fees, indemnities, prepayment premiums, costs and expenses and
other amounts payable to any Lender Party under any Loan Document, including
all renewals or extensions thereof; provided that notwithstanding anything to
the contrary in any Loan Document, "Senior Debt Obligations" shall not include
any Obligations of any Borrower owed to any of its Affiliates.
"Services Corp" means Allegheny Energy Service Corporation, a Maryland
corporation.
"Services Corp AESC Debt" means secured or unsecured Debt of Services
Corp attributable to, or incurred by Services Corp on behalf of, any AESC
Company.
"Services Corp Regulated Debt" means secured or unsecured Debt of
Services Corp attributable to, or incurred by Services Corp on behalf of, AYE
or any Regulated Subsidiary.
"Single-Employer Plan" means a single-employer plan, as defined in
Section 4001(a)(15) of ERISA, that (a) is maintained for employees of AYE or
any of its Subsidiaries or any ERISA Affiliate and no Person other than AYE,
its Subsidiaries and the ERISA Affiliates or (b) was so maintained and in
respect of which AYE, any of its Subsidiaries or any ERISA Affiliate could
have liability under Section 4069 of ERISA in the event such plan has been or
were to be terminated.
"Specified Default" means (a) any Event of Default under clause (a) or
(g) of Section 6.01 or (b) any event that would constitute an Event of Default
under clause (a) or (g) of Section 6.01 but for the requirement that notice be
given or time elapse or both.
"SPV" shall have the meaning provided in Section 8.07(h).
"Standby Letter of Credit" means any Letter of Credit issued under this
Agreement, other than a Trade Letter of Credit.
33
"Stranded Cost Securitization" has the meaning specified in Section
5.02(e)(viii)(A).
"Subsidiary" of any Person means any corporation, partnership, joint
venture, limited liability company, trust or estate of which (or in which)
more than 50% of (a) the issued and outstanding capital stock having ordinary
voting power to elect a majority of the board of directors of such corporation
(irrespective of whether at the time capital stock of any other class or
classes of such corporation shall or might have voting power upon the
occurrence of any contingency), (b) the interest in the capital or profits of
such partnership, joint venture or limited liability company or (c) the
beneficial interest in such trust or estate is at the time, directly or
indirectly owned or controlled by such Person, by such Person and one or more
of its other Subsidiaries or by one or more of such Person's other
Subsidiaries.
"Surviving Debt" means Debt of AYE and its Subsidiaries (other than the
Regulated Subsidiaries and the AESC Companies) outstanding immediately prior
to giving effect to the Transactions.
"S&P" means Standard & Poor's, a division of The XxXxxx-Xxxx Companies,
Inc.
"Tax Allocation Agreement" means the Tax Allocation Agreement, dated as
of July 1, 2003, by and among AYE and its Subsidiaries, as amended by
Amendment No. 1, dated December 21, 2005, by and among AYE and its
Subsidiaries.
"Taxes" has the meaning specified in Section 2.13(a).
"Term Advance" has the meaning specified in Section 2.01(b).
"Term Borrowing" means the borrowing consisting of simultaneous Term
Advances of the same Type, made by the Term Lenders.
"Term Commitment" means, as to each Term Lender, its obligation to make
a Term Advance to AYE pursuant to Section 2.01(b), in an aggregate principal
amount at any one time outstanding not to exceed the amount set forth opposite
such Term Lender's name on Schedule I under the caption "Term Commitment" or
in the Assignment and Assumption pursuant to which such Term Lender becomes a
party hereto, as applicable, as such amount may be adjusted from time to time
in accordance with this Agreement.
"Term Commitment Termination Date" has the meaning specified in Section
2.05(b)(ii).
"Term Facility" means, at any time, the aggregate of the Term
Commitments at such time.
"Term Lender" means any Lender that has a Term Commitment.
34
"Term Note" means a promissory note of AYE payable to the order of a
Term Lender in substantially the form of Exhibit A-2, evidencing the aggregate
indebtedness of AYE to such Term Lender resulting from Term Advances made by
such Term Lender hereunder to AYE.
"Termination Event" means an event described in Section 4042(a) of
ERISA.
"Total Revolving Outstandings" means the aggregate Outstanding Amount of
all Revolving Advances and all L/C Obligations.
"Trade Letter of Credit" means any Letter of Credit that is issued under
this Agreement for the benefit of a supplier of goods or services to any
Borrower or any of its Subsidiaries to effect payment for such goods or
services, the conditions to drawing under which include the presentation to an
Issuing Bank.
"Transactions" means (a) the refinancing of Debt outstanding under the
Existing Credit Agreement with the proceeds of Revolving Advances and the Term
Advances and (b) the continuance of the Existing L/Cs as AYE Letters of Credit
issued under this Agreement.
"Type" refers (a) in the case of Advances, to the distinction between
Advances bearing interest at the Base Rate and Advances bearing interest at
the Eurodollar Rate, (b) in the case of Letters of Credit, to the distinction
between AYE Letters of Credit, AESC Direct Letters of Credit and AESC Indirect
Letters of Credit, (c) in the case of L/C Obligations, to the distinction
between AYE L/C Obligations, AESC Direct L/C Obligations and AESC Indirect L/C
Obligations and (d) in the case of L/C Credit Extensions, to the distinction
between AYE L/C Credit Extensions, AESC Direct Credit Extensions and AESC
Indirect Credit Extensions.
"Unreimbursed Amount" has the meaning specified in Section 2.03(b)(i).
"Unused Commitment" means, with respect to any Revolving Lender at any
time, (a) such Revolving Lender's Revolving Commitment at such time minus (b)
such Revolving Lender's Pro Rata Share of the Total Revolving Outstandings.
"Voting Interests" means shares of capital stock issued by a
corporation, or equivalent Equity Interests in any other Person, the holders
of which are ordinarily, in the absence of contingencies, entitled to vote for
the election of directors (or persons performing similar functions) of such
Person, even if the right so to vote has been suspended by the happening of
such a contingency.
"Withdrawal Liability" has the meaning specified in Part I of Subtitle E
of Title IV of ERISA.
"WPPC" means West Penn Power Company, a Pennsylvania corporation.
35
SECTION 1.02. Principles of Interpretation. (a) Except to the extent
expressly provided to the contrary in this Agreement or to the extent that the
context otherwise requires, in this Agreement and the other Loan Documents:
(i) the table of contents and Article and Section
headings are for convenience only and shall not affect the
interpretation of any Loan Document;
(ii) references to any document, instrument or agreement,
including any Loan Document, shall include (A) all exhibits,
annexes, schedules, appendices or other attachments thereto
and (B) all documents, instruments or agreements issued or
executed in replacement thereof;
(iii) references to a document or agreement, including
any Loan Document, shall be deemed to include any amendment,
restatement, modification, supplement or replacement thereto
entered into in accordance with the terms thereof and the
terms of the Loan Documents;
(iv) the words "include", "includes" and "including" are
not limiting;
(v) references to any Person shall include such Person's
successors and permitted assigns (and in the case of any
Governmental Authority, any Person succeeding to such
Governmental Authority's functions and capacities);
(vi) the words "hereof", "herein" and "hereunder" and
words of similar import when used in any Loan Document shall
refer to such Loan Document as a whole and not to any
particular provision of such Loan Document;
(vii) references to "days" shall mean calendar days;
(viii) the singular includes the plural and the plural
includes the singular;
(ix) references to Applicable Law, generally, shall mean
Applicable Law as in effect from time to time, and references
to any specific Applicable Law shall mean such Applicable Law,
as amended, modified or supplemented from time to time, and
any Applicable Law successor thereto;
(x) in the computation of periods of time from a
specified date to a later specified date, the word "from"
means "from and including" and the words "to" and "until" each
mean "to but excluding"; and
(xi) any reference in this Agreement or any other Loan
Document to an Article, Section, Schedule, Appendix or Exhibit
is to the article or section of, or a schedule, appendix or
exhibit to, this Agreement or such other Loan Document, as the
case may be, unless otherwise indicated.
(b) This Agreement and the other Loan Documents are the result of
negotiations among the parties hereto and their respective counsel.
Accordingly, this Agreement and the other Loan Documents shall be deemed the
product of all parties hereto or thereto, as the
36
case may be, and no ambiguity in this Agreement or any Loan Document shall be
construed in favor of or against the Borrowers, the Administrative Agent, any
Arranger Party or any Lender that is a party hereto.
(c) All accounting terms used herein shall be interpreted, all
accounting determinations hereunder shall be made, and all financial
statements required to be delivered hereunder shall be prepared, in accordance
with generally accepted accounting principles as in effect from time to time,
applied on a basis consistent (except for changes concurred in by AYE's
independent public accountants) with the most recent audited consolidated
financial statements of AYE and its Subsidiaries delivered to the Lenders
("GAAP"); provided that, if AYE notifies the Administrative Agent that AYE
wishes to amend any covenant in Section 5.04 to eliminate the effect of any
change in generally accepted accounting principles on the operation of such
covenant (or if the Administrative Agent notifies AYE that the Required
Lenders wish to amend Section 5.04 for such purpose), then AYE's compliance
with such covenant shall be determined on the basis of generally accepted
accounting principles in effect immediately before the relevant change in
generally accepted accounting principles became effective, until either such
notice is withdrawn or such covenant is amended in a manner satisfactory to
AYE and the Required Lenders.
SECTION 1.03. Letter of Credit. Unless otherwise specified, all
references herein to the amount of a Letter of Credit at any time shall be
deemed to mean the stated face amount of such Letter of Credit in effect at
such time; provided, however, that with respect to any Letter of Credit that,
by its terms or the terms of any Issuer Document related thereto, provides for
one or more automatic increases in the stated amount thereof, the amount of
such Letter of Credit shall be deemed the maximum stated amount of such Letter
of Credit after giving effect to all increases thereof, whether or not such
maximum face amount is in effect at such time.
SECTION 1.04. Joint and Several Obligations of AYE. Notwithstanding
anything to the contrary in any Loan Document, AYE shall be jointly and
severally liable for all Obligations of AESC under the Loan Documents. Such
Obligations of AYE shall be irrevocable, absolute and unconditional
irrespective of, and AYE hereby irrevocably waives any defenses it may now or
hereafter acquire in any way relating to, any of the following:
(a) any lack of validity or enforceability of any Loan Document or any
agreement or instrument relating thereto;
(b) any change in the time, manner or place of payment of, or in any
other term of, all or any Obligations of AESC under or in respect of the Loan
Documents, or any other amendment or waiver of or any consent to departure
from any Loan Document, including any increase in the Obligations of AESC
under or in respect of the Loan Documents resulting from the extension of
additional credit to AESC or any of its Subsidiaries or otherwise;
(c) any Insolvency Proceeding with respect to, or any change,
restructuring or termination of the corporate structure or existence of, AESC;
37
(d) any failure of any Lender Party to disclose to AYE any information
relating to the business, condition (financial or otherwise), operations,
performance, properties or prospects of AESC now or hereafter known to such
Lender Party (AYE waiving any duty on the part of the Lender Parties to
disclose such information); or
(e) any other circumstance (including any statute of limitations) or any
existence of or reliance on any representation by any Lender Party that might
otherwise constitute a defense available to, or a discharge of, AYE.
ARTICLE II
AMOUNTS AND TERMS OF THE ADVANCES
AND LETTERS OF CREDIT
SECTION 2.01. The Advances. (a) Revolving Advance. Each Revolving Lender
severally agrees, on the terms and conditions hereinafter set forth, to make
advances (each a "Revolving Advance") to any Borrower from time to time on any
Business Day during the period from the Closing Date until the Final Maturity
Date in an amount for each such Revolving Advance not to exceed such Revolving
Lender's Unused Commitment at such time; provided that (i) the amount of each
Revolving Borrowing made to any Borrower shall not exceed the Borrowing Limit
applicable to such Borrower at such time, (ii) no Revolving Borrowing shall be
made to AESC unless the aggregate Unused Commitments shall be equal to or
greater than $100,000,000 after giving pro forma effect to such Revolving
Borrowing, and (iii) after giving effect to any Revolving Borrowing, (A) the
Total Revolving Outstandings shall not exceed the Revolving Facility, and (B)
the aggregate Outstanding Amount of the Revolving Advances of any Revolving
Lender plus such Revolving Lender's Pro Rata Share of the Outstanding Amount
of all L/C Obligations shall not exceed such Revolving Lender's Revolving
Commitment. Each Revolving Borrowing shall be in an aggregate amount of
$2,000,000 or an integral multiple of $1,000,000 in excess thereof (other than
a Revolving Borrowing the proceeds of which shall be used solely to repay or
prepay in full any L/C Borrowing) and shall consist of Revolving Advances of
the same Type made simultaneously by the Revolving Lenders ratably according
to their Revolving Commitments. Within the limits of each Revolving Lender's
Unused Commitment in effect from time to time and the Borrowing Limits
applicable to each Borrower, either Borrower may borrow under this Section
2.01(a), prepay pursuant to Section 2.06 and reborrow under this Section
2.01(a).
(b) Term Advance. Each Term Lender severally agrees, on the terms and
conditions hereinafter set forth, to make a single advance (each a "Term
Advance") to AYE on the Closing Date in an amount not to exceed such Term
Lender's Term Commitment. The Term Borrowing shall consist of Term Advances of
the same Type made simultaneously by the Term Lenders on such Business Day
ratably according to their Term Commitments. Amounts borrowed under this
Section 2.01(b) and repaid or prepaid may not be reborrowed.
(c) Continuance of the Existing L/Cs. AYE hereby requests that the
Initial Issuing Bank continue hereunder, and the Initial Issuing Bank hereby
agrees that upon
38
fulfillment of the conditions set forth in Section 3.01 it will continue
hereunder, on the Closing Date, the Existing L/Cs for the account of AYE on
behalf of certain of its Subsidiaries (as identified in Schedule 1.01(a)) and,
upon such continuance, each of the Existing L/Cs shall be deemed to be an AYE
Letter of Credit and shall be governed by the terms hereof. The continuance of
each Existing L/C shall be deemed to constitute, for all purposes under this
Agreement and the other Loan Documents, the issuance of an AYE Letter of
Credit.
(d) AYE Letters of Credit. Subject to the terms and conditions set forth
herein, (A) each Issuing Bank agrees, in reliance upon the agreements of the
other Revolving Lenders set forth in Section 2.03, (1) from time to time on
any Business Day during the period from the Closing Date until the Letter of
Credit Expiration Date, to make AYE L/C Credit Extensions for the account of
AYE or its Subsidiaries (excluding the AESC Companies), and to amend or extend
AYE Letters of Credit previously issued by it, in accordance with Section
2.03(a)(i) and (ii), and (2) to honor drawings under the AYE Letters of
Credit; and (B) the Revolving Lenders severally agree to participate in AYE
Letters of Credit issued for the account of AYE or its Subsidiaries (excluding
the AESC Companies) and any L/C Borrowings thereunder; provided that after
giving effect to any AYE L/C Credit Extension with respect to any AYE Letter
of Credit, (x) the Total Revolving Outstandings shall not exceed the Revolving
Facility and (y) the aggregate Outstanding Amount of the Revolving Advances of
any Revolving Lender, plus such Revolving Lender's Pro Rata Share of the
Outstanding Amount of all L/C Obligations, shall not exceed such Revolving
Lender's Revolving Commitment. Each request by AYE for the issuance of, or an
amendment to increase the amount of, any AYE Letter of Credit shall be deemed
to be a representation by AYE that the AYE L/C Credit Extension so requested
complies with the conditions set forth in the proviso to the preceding
sentence. Within the foregoing limits, and subject to the terms and conditions
hereof, AYE's ability to obtain AYE Letters of Credit shall be fully
revolving, and accordingly AYE may, during the foregoing period, obtain AYE
Letters of Credit to replace Letters of Credit that have expired or that have
been drawn upon and reimbursed.
(e) AESC Indirect Letters of Credit. Subject to the terms and conditions
set forth herein, (A) each Issuing Bank agrees, in reliance upon the
agreements of the other Revolving Lenders set forth in Section 2.03, (1) from
time to time on any Business Day during the period from the Closing Date until
the Letter of Credit Expiration Date, to make AESC Indirect L/C Credit
Extensions for the account of AYE on behalf of AESC or its Subsidiaries, and
to amend or extend AESC Indirect Letters of Credit previously issued by it, in
accordance with Section 2.03(a)(i) and (ii), and (2) to honor drawings under
the AESC Indirect Letters of Credit; and (B) the Revolving Lenders severally
agree to participate in AESC Indirect Letters of Credit issued for the account
of AYE on behalf of AESC or its Subsidiaries and any L/C Borrowings
thereunder; provided that after giving effect to any AESC Indirect L/C Credit
Extension with respect to any AESC Indirect Letter of Credit, (x) the
Outstanding Amount of all AESC Indirect L/C Obligations shall not exceed the
AESC Indirect L/C Sublimit, (y) the Total Revolving Outstandings shall not
exceed the Revolving Facility and (z) the aggregate Outstanding Amount of the
Revolving Advances of any Revolving Lender, plus such Revolving Lender's Pro
Rata Share of the Outstanding Amount of all L/C Obligations, shall not exceed
such Revolving Lender's Revolving Commitment. Each request by AYE for the
issuance of, or an amendment to increase the amount of, an AESC Indirect
Letter of Credit shall be deemed to be a representation by AYE that the AESC
Indirect L/C Credit Extension so requested complies
39
with the conditions set forth in the proviso to the preceding sentence. Within
the foregoing limits, and subject to the terms and conditions hereof, AYE's
ability to obtain AESC Indirect Letters of Credit shall be fully revolving,
and accordingly AYE may, during the foregoing period, obtain AESC Indirect
Letters of Credit to replace Letters of Credit that have expired or that have
been drawn upon and reimbursed.
(f) AESC Direct Letters of Credit. Subject to the terms and conditions
set forth herein, (A) each Issuing Bank agrees, in reliance upon the
agreements of the other Revolving Lenders set forth in Section 2.03, (1) from
time to time on any Business Day during the period from the Closing Date until
the Letter of Credit Expiration Date, to make AESC Direct L/C Credit
Extensions for the account of AESC or its Subsidiaries, and to amend or extend
AESC Direct Letters of Credit previously issued by it, in accordance with
Section 2.03(a)(i) and (ii), and (2) to honor drawings under the AESC Direct
Letters of Credit; and (B) the Revolving Lenders severally agree to
participate in AESC Direct Letters of Credit issued for the account of AESC or
its Subsidiaries and any L/C Borrowings thereunder; provided that (i) no AESC
Direct L/C Credit Extension shall be made for the account of AESC unless the
aggregate Unused Commitments shall be equal to or greater than $100,000,000
after giving pro forma effect to such AESC Direct L/C Credit Extension; and
(ii) after giving effect to any AESC Direct L/C Credit Extension with respect
to any AESC Direct Letter of Credit, (x) the Outstanding Amount of all AESC
Direct L/C Obligations, plus the aggregate principal amount of all Revolving
Advances made to AESC outstanding at such time shall not exceed the AESC
Direct Advance and L/C Sublimit, (y) the Total Revolving Outstandings shall
not exceed the Revolving Facility and (z) the aggregate Outstanding Amount of
the Revolving Advances of any Revolving Lender, plus such Revolving Lender's
Pro Rata Share of the Outstanding Amount of all L/C Obligations, shall not
exceed such Revolving Lender's Revolving Commitment. Each request by AESC for
the issuance of, or an amendment to increase the amount of, any AESC Direct
Letter of Credit shall be deemed to be a representation by AYE and AESC that
the AESC Direct L/C Credit Extension so requested complies with the conditions
set forth in the proviso to the preceding sentence. Within the foregoing
limits, and subject to the terms and conditions hereof, AESC's ability to
obtain AESC Direct Letters of Credit shall be fully revolving, and accordingly
AESC may, during the foregoing period, obtain AESC Direct Letters of Credit to
replace Letters of Credit that have expired or that have been drawn upon and
reimbursed.
(g) Letters of Credit Generally. (i) No Issuing Bank shall issue any
Letter of Credit if the expiry date of such requested Letter of Credit would
occur after the Letter of Credit Expiration Date, unless all the Revolving
Lenders have approved such expiry date; provided that in no event shall the
expiry date of any requested Letter of Credit occur on or after the Business
Day next preceding the fifth anniversary of the Closing Date.
(ii) No Issuing Bank shall be under any Obligation to make any L/C
Credit Extension if:
(A) any order, judgment or decree of any Governmental
Authority or arbitrator shall by its terms purport to enjoin or
restrain such Issuing Bank from issuing such Letter of Credit,
or any Applicable Law to such Issuing Bank or any request or
directive (whether or not having the force of law) from any
Governmental Authority with jurisdiction over such Issuing Bank
shall prohibit, or request that the Issuing Bank refrain
40
from, the issuance of Letters of Credit generally or such Letter
of Credit in particular or shall impose upon such Issuing Bank
with respect to such Letter of Credit any restriction, reserve
or capital requirement (for which such Issuing Bank is not
otherwise compensated hereunder) not in effect on the Closing
Date, or shall impose upon such Issuing Bank any unreimbursed
loss, cost or expense which was not applicable on the Closing
Date and which such Issuing Bank in good xxxxx xxxxx material to
it;
(B) the making of such L/C Credit Extension would violate
any Applicable Laws;
(C) except as otherwise agreed by the Administrative Agent
and such Issuing Bank, such Letter of Credit is in an initial
face amount less than $100,000;
(D) such L/C Credit Extension is to be denominated in a
currency other than Dollars;
(E) such L/C Credit Extension contains any provisions for
automatic reinstatement of the stated amount after any L/C
Borrowing thereunder; or
(F) a default of any Revolving Lender's obligations to
fund under Section 2.03 exists, unless such Issuing Bank has
entered into satisfactory arrangements with the Borrowers or
such Revolving Lender to eliminate such Issuing Bank's risk with
respect to such Revolving Lender.
(iii) No Issuing Bank shall amend any Letter of Credit if such Issuing
Bank would not be permitted at such time to make such L/C Credit Extension in
its amended form under the terms hereof.
(iv) No Issuing Bank shall be under the obligation to amend any Letter
of Credit if (A) such Issuing Bank would have no obligation at such time to
issue such Letter of Credit in its amended form under the terms hereof, or (B)
the beneficiary of such Letter of Credit does not accept the proposed
amendment to such Letter of Credit.
SECTION 2.02. Making the Advances. (a) Except as otherwise provided in
Section 2.03, each Borrowing to any Borrower shall be made on notice, given by
AYE on behalf of such Borrower (and each Borrower other than AYE hereby
unconditionally and irrevocably instructs AYE to issue such notice on its
behalf) not later than 2:00 p.m. (New York City time) on the third Business
Day prior to the date of the proposed Borrowing in the case of a Borrowing
consisting of Eurodollar Rate Advances, or on the date of the proposed
Borrowing in the case of a Borrowing consisting of Base Rate Advances, to the
Administrative Agent, which shall give to each Lender prompt notice thereof by
telecopier or electronic mail. Each such notice of a Borrowing (a "Notice of
Borrowing") shall be by telephone, confirmed immediately in writing, or
telecopier or electronic mail, in substantially the form of Exhibit B,
specifying therein (i) the identity of the Borrower and (ii) the requested (A)
date of such Borrowing, (B) Type of Advances comprising such Borrowing, (C)
aggregate amount of such Borrowing and (D) in the case of a Borrowing
consisting of Eurodollar Rate Advances, initial Interest Period for each such
Advance. Each Lender shall, before 12:00 noon (New York City time) on the date
of such Borrowing, make available for the account of its Applicable Lending
Office to
41
the Administrative Agent at the Administrative Agent's Account, in
immediately available funds, such Lender's ratable portion of such Borrowing
in accordance with the respective Commitment of such Lender under the
applicable Facility and the other Appropriate Lenders. After the
Administrative Agent's receipt of such funds and upon fulfillment of the
applicable conditions set forth in Article III, the Administrative Agent shall
(i) with respect to the Initial Borrowing, directly apply (x) the Revolving
Advances, together with the Term Advances, to the repayment of the Existing
AYE Debt and (y) the L/C Credit Extensions for the account of AYE to the
continuance of the Existing L/Cs as AYE Letters of Credit, (ii) with the
respect to the single Term Borrowing, directly apply the Term Advances,
together with Revolving Advances made as part of the Initial Borrowing, to the
repayment of the Existing AYE Debt and (iii) with respect to subsequent
Revolving Borrowings, make such funds available to the relevant Borrower, by
crediting such Borrower's Borrowing Account.
(b) Anything in subsection (a) above to the contrary notwithstanding,
(i) no Borrower may select Eurodollar Rate Advances for any Borrowing if the
aggregate amount of such Borrowing is less than $2,000,000 or if the
obligation of the Lenders to make Eurodollar Rate Advances shall then be
suspended pursuant to Section 2.10 or 2.11 and (ii) the Advances may not be
outstanding as part of more than fifteen separate Borrowings.
(c) Each Notice of Borrowing shall be irrevocable and binding on the
Borrower issuing such Notice of Borrowing. In the case of any Borrowing that
the relevant Borrower has specified in the related Notice of Borrowing is to
be comprised of Eurodollar Rate Advances, such Borrower shall indemnify each
Appropriate Lender against any loss, cost or expense incurred by such Lender
as a result of any failure to fulfill on or before the date specified in such
Notice of Borrowing for such Borrowing the applicable conditions set forth in
Article III, including any loss (including loss of anticipated profits), cost
or expense incurred by reason of the liquidation or redeployment of deposits
or other funds acquired by such Lender to fund the Advance to be made by such
Lender as part of such Borrowing when such Advance, as a result of such
failure, is not made on such date.
(d) Subject to the Administrative Agent giving prompt notice of the
relevant Notice of Borrowing received by the Administrative Agent to the Term
Lenders or the Revolving Lenders, as the case may be, unless the
Administrative Agent shall have received notice from an Appropriate Lender
prior to the date of the Borrowing requested under such Notice of Borrowing
that such Lender will not make available to the Administrative Agent such
Lender's ratable portion of such Borrowing, the Administrative Agent may
assume that such Lender has made such portion available to the Administrative
Agent on the date of such Borrowing in accordance with subsection (a) of this
Section 2.02 and the Administrative Agent may, in reliance upon such
assumption, make available to the relevant Borrower a corresponding amount. If
and to the extent that such Lender shall not have so made such ratable portion
available to the Administrative Agent, such Lender and such Borrower severally
agree to repay or pay to the Administrative Agent forthwith on demand such
corresponding amount and to pay interest thereon, for each day from the date
such amount is made available to such Borrower until the date such amount is
repaid or paid to the Administrative Agent, at (i) in the case of such
Borrower, the interest rate applicable at such time under Section 2.07 to
Advances comprising such Borrowing and (ii) in the case of such Lender, the
Federal Funds Rate. If such Lender shall
42
pay to the Administrative Agent such corresponding amount, such amount so paid
shall constitute such Lender's Advance as part of such Borrowing for all
purposes.
(e) The failure of any Lender to make the Advance to be made by it as
part of any Borrowing shall not relieve any other Lender of its obligation, if
any, hereunder to make its Advance on the date of such Borrowing, but no
Lender shall be responsible for the failure of any other Lender to make the
Advance to be made by such other Lender on the date of any Borrowing.
SECTION 2.03. Issuance of Letters of Credit; Drawings and
Reimbursements; Auto-Extension Letters of Credit; Funding of Participations.
(a) Procedures for Issuance and Amendment of Letters of Credit; Auto-Extension
Letters of Credit. (i) Each Letter of Credit shall be issued or amended, as
the case may be, upon the request of the Related Borrower delivered to an
Issuing Bank (with a copy to the Administrative Agent) in the form of a Letter
of Credit Application, appropriately completed and signed by a Responsible
Officer of such Borrower. Such Letter of Credit Application must be received
by such Issuing Bank and the Administrative Agent not later than 12:00 noon
(New York City time) at least one (1) Business Day (or such later date and
time as the Administrative Agent and the Issuing Bank may agree in a
particular instance in their sole discretion) prior to the proposed issuance
date or date of amendment, as the case may be. In the case of a request for an
initial issuance of a Letter of Credit, such Letter of Credit Application
shall specify in form and detail satisfactory to the respective Issuing Bank:
(A) the proposed issuance date of the requested Letter of Credit (which shall
be a Business Day); (B) the amount thereof; (C) the expiry date thereof (which
date shall be not later than the earlier of (a) the date which is twelve (12)
months after the proposed issuance date and (b) the Letter of Credit
Expiration Date (or such later date as may be agreed by the Revolving Lenders
in accordance with Section 2.01(g)); (D) the name and address of the
beneficiary thereof; (E) the documents to be presented by such beneficiary in
case of any drawing thereunder; (F) the full text of any certificate to be
presented by such beneficiary in case of any drawing thereunder; (G) whether
such Letter of Credit is to be or, in the case of any amendment to any Letter
of Credit, is, an AYE Letter of Credit, AESC Indirect Letter of Credit or AESC
Direct Letter of Credit; and (H) such other matters as such Issuing Bank may
require. In the case of a request for an amendment of any outstanding Letter
of Credit, such Letter of Credit Application shall specify in form and detail
satisfactory to the Issuing Bank (A) the Letter of Credit to be amended; (B)
the proposed date of amendment thereof (which shall be a Business Day); (C)
the nature of the proposed amendment; and (D) such other matters as such
Issuing Bank may require. Additionally, the Related Borrower shall furnish to
each Issuing Bank and the Administrative Agent such other documents and
information pertaining to such requested Letter of Credit issuance or
amendment, including any Issuer Documents, as each such Issuing Bank or the
Administrative Agent may require.
(ii) Promptly after receipt of any Letter of Credit Application, the
Issuing Bank will confirm with the Administrative Agent (by telephone or in
writing) that the Administrative Agent has received a copy of such Letter of
Credit Application from the Related Borrower and, if not, such Issuing Bank
will provide the Administrative Agent with a copy thereof. Unless such Issuing
Bank has received written notice from any Revolving Lender, the Administrative
Agent or the Related Borrower, at least one (1) Business Day prior to the
requested date of issuance or amendment of the applicable Letter of Credit,
that one or more
43
applicable conditions contained in Article III shall not then be satisfied,
then, subject to the terms and conditions hereof, such Issuing Bank shall, on
the requested date, make an L/C Credit Extension for the account of such
Related Borrower (or the applicable Subsidiary) or enter into the applicable
amendment, as the case may be, in each case in accordance with such Issuing
Bank's usual and customary business practices. Immediately upon the making of
each L/C Credit Extension, each Revolving Lender shall be deemed to, and
hereby irrevocably and unconditionally agrees to, purchase from such Issuing
Bank a risk participation in such L/C Credit Extension in an amount equal to
the product of such Revolving Lender's Pro Rata Share times the amount of such
L/C Credit Extension.
(iii) If the Related Borrower so requests in any applicable Letter of
Credit Application, the Issuing Bank may, in its sole and absolute discretion,
agree to make an L/C Credit Extension that has automatic extension provisions
(each, an "Auto-Extension Letter of Credit"); provided that any such
Auto-Extension Letter of Credit must permit such Issuing Bank to prevent any
such extension at least once in each twelve-month period (commencing with the
date of issuance of such Letter of Credit) or upon notice to such Issuing Bank
by the Administrative Agent or the Related Borrower of an Insolvency
Proceeding with respect to such Related Borrower or any of its Subsidiaries,
by giving prior notice to the beneficiary thereof not later than a day (the
"Non-Extension Notice Date") in each such twelve-month period to be agreed
upon at the time such Letter of Credit is issued. Unless otherwise directed by
such Issuing Bank, the Related Borrower shall not be required to make a
specific request to such Issuing Bank for any such extension. Once an
Auto-Extension Letter of Credit has been issued, the Revolving Lenders shall
be deemed to have authorized (but may not require) such Issuing Bank to permit
the extension of such Letter of Credit at any time to an expiry date not later
than the Letter of Credit Expiration Date (or such later date as may be agreed
by the Revolving Lenders in accordance with Section 2.01(g)); provided,
however, that such Issuing Bank shall not permit any such extension if (A)
such Issuing Bank has determined that it would not be permitted, or would have
no obligation at such time to issue such Letter of Credit in its revised form
(as extended) under the terms hereof (by reason of the provisions of Sections
2.01(d), (e) or (f) or otherwise), or (B) it has received notice (which may be
by telephone or in writing) on or before the day that is five Business Days
before the Non-Extension Notice Date (1) from the Administrative Agent that
the Required Revolving Lenders have elected not to permit such extension or
(2) from the Administrative Agent or any Revolving Lender that one or more of
the applicable conditions specified in Section 3.02 is not then satisfied, and
in each such case directing such Issuing Bank not to permit such extension.
(iv) Promptly after its delivery of any Letter of Credit or any
amendment to a Letter of Credit to an advising bank with respect thereto or to
the beneficiary thereof, such Issuing Bank will also deliver to the Related
Borrower and the Administrative Agent a true and complete copy of such Letter
of Credit or amendment thereof.
(b) Drawings and Reimbursements; Funding of Participations. (i) Upon
receipt from the beneficiary of any Letter of Credit of any notice of a
drawing under such Letter of Credit, the Issuing Bank shall notify the
Administrative Agent and the Related Borrower thereof. Not later than 11:00
a.m. (New York City time) on the date of any payment by such Issuing Bank
under a Letter of Credit (each such date, an "Honor Date"), the Related
Borrower shall reimburse such Issuing Bank through the Administrative Agent in
an amount equal to the
44
amount of such drawing. If the Related Borrower fails to so reimburse such
Issuing Bank by such time, the Administrative Agent shall promptly notify each
Revolving Lender of the Honor Date, the amount of the unreimbursed drawing
(the "Unreimbursed Amount"), and the amount of such Revolving Lender's Pro
Rata Share thereof. In such event, the Related Borrower shall be deemed to
have requested a Revolving Borrowing of Base Rate Advances to be disbursed on
the Honor Date in an amount equal to the Unreimbursed Amount, without regard
to the minimum and multiples specified in Section 2.01 for the principal
amount of Base Rate Advances, but subject to the other conditions set forth in
Section 2.01 and the conditions set forth in Section 3.02 (other than the
delivery of a Notice of Borrowing). Any notice given by such Issuing Bank or
the Administrative Agent pursuant to this Section 2.03(b) may be given by
telephone if immediately confirmed in writing; provided that the lack of such
an immediate confirmation shall not affect the conclusiveness or binding
effect of such notice.
(ii) Each Revolving Lender (including the Revolving Lender acting as
Issuing Bank) shall upon any notice pursuant to Section 2.03(b)(i) make funds
available to the Administrative Agent for the account of such Issuing Bank at
the Administrative Agent's Account in an amount equal to its Pro Rata Share of
the Unreimbursed Amount not later than 1:00 p.m. (New York City time) on the
Business Day specified in such notice by the Administrative Agent, whereupon,
subject to the provisions of Section 2.03(b)(iii), each Revolving Lender that
so makes funds available shall be deemed to have made a Base Rate Advance to
the Related Borrower in such amount. The Administrative Agent shall remit the
funds so received to such Issuing Bank.
(iii) With respect to any Unreimbursed Amount that is not fully
refinanced by a Revolving Borrowing of Base Rate Advances because the
conditions set forth in Section 3.02 cannot be satisfied or for any other
reason, the Related Borrower shall be deemed to have incurred from the Issuing
Bank an L/C Borrowing in the amount of the Unreimbursed Amount that is not so
refinanced, which L/C Borrowing shall be due and payable on demand (together
with interest) and shall bear interest at a rate equal to the sum of (A) the
Base Rate in effect from time to time, plus (B) the Applicable Margin in
effect from time to time, plus (C) 2% per annum. In such event, each Revolving
Lender's payment to the Administrative Agent for the account of such Issuing
Bank pursuant to Section 2.03(b)(ii) shall be deemed payment in respect of its
participation in such L/C Borrowing and shall constitute an L/C Advance from
such Revolving Lender in satisfaction of its participation obligation under
this Section 2.03.
(iv) Until each Revolving Lender funds its Revolving Advance or L/C
Advance pursuant to this Section 2.03(b) to reimburse such Issuing Bank for
any amount drawn under any Letter of Credit, interest in respect of such
Revolving Lender's Pro Rata Share of such drawing shall be solely for the
account of such Issuing Bank.
(v) Each Revolving Lender's obligation to make Revolving Advances or L/C
Advances to reimburse any Issuing Bank for amounts drawn under Letters of
Credit, as contemplated by this Section 2.03(b), shall be absolute and
unconditional and shall not be affected by any circumstance, including (A) any
setoff, counterclaim, recoupment, defense or other right which such Revolving
Lender may have against the Issuing Bank, any Borrower or any other Person for
any reason whatsoever; (B) the occurrence or continuance of a Default, or (C)
any other occurrence, event or condition, whether or not similar to any of the
foregoing. No
45
such making of an L/C Advance shall relieve or otherwise impair the obligation
of the Related Borrower to reimburse any Issuing Bank for the amount of any
payment made by the Issuing Bank under any Letter of Credit, together with
interest as provided herein.
(vi) If any Revolving Lender fails to make available to the
Administrative Agent for the account of any Issuing Bank any amount required
to be paid by such Revolving Lender pursuant to the foregoing provisions of
this Section 2.03(b) by the time specified in Section 2.03(b)(ii), such
Issuing Bank shall be entitled to recover from such Revolving Lender (acting
through the Administrative Agent), on demand, such amount with interest
thereon for the period from the date such payment is required to the date on
which such payment is immediately available to such Issuing Bank at a rate per
annum equal to the Federal Funds Rate from time to time in effect. A
certificate of such Issuing Bank submitted to any Revolving Lender (through
the Administrative Agent) with respect to any amounts owing under this Section
2.03(b)(vi) shall be conclusive absent manifest error.
(c) Repayment of Participations. (i) At any time after an Issuing Bank
has made a payment under any Letter of Credit and has received from any
Revolving Lender such Revolving Lender's L/C Advance in respect of such
payment in accordance with Section 2.03(b), if the Administrative Agent
receives for the account of such Issuing Bank any payment in respect of the
related Unreimbursed Amount or interest thereon (whether directly from the
Related Borrower or otherwise, including proceeds of Cash Collateral applied
thereto by the Administrative Agent), the Administrative Agent will distribute
to such Revolving Lender its Pro Rata Share thereof (appropriately adjusted,
in the case of interest payments, to reflect the period of time during which
such Revolving Lender's L/C Advance was outstanding) in the same funds as
those received by the Administrative Agent.
(ii) If any payment received by the Administrative Agent for the account
of an Issuing Bank pursuant to Section 2.03(b)(i) is required to be returned
under any of the circumstances described in Section 2.11 (including pursuant
to any settlement entered into by such Issuing Bank in its discretion), each
Revolving Lender shall pay to the Administrative Agent for the account of such
Issuing Bank its Pro Rata Share thereof on demand of the Administrative Agent,
plus interest thereon from the date of such demand to the date such amount is
returned by such Revolving Lender, at a rate per annum equal to the Federal
Funds Rate from time to time in effect.
(d) Role of Issuing Bank. Each Revolving Lender and the Borrowers agree
that, in paying any drawing under a Letter of Credit, each Issuing Bank shall
not have any responsibility to obtain any document (other than any sight
draft, certificates and documents expressly required by any Letter of Credit)
or to ascertain or inquire as to the validity or accuracy of any such document
or the authority of the Person executing or delivering any such document. None
of the Issuing Bank, the Administrative Agent nor any of the respective
correspondents, participants or assignees of such Issuing Bank shall be liable
to any Revolving Lender for (i) any action taken or omitted in connection
herewith at the request or with the approval of the Revolving Lenders or the
Required Revolving Lenders, as applicable; (ii) any action taken or omitted in
the absence of gross negligence or willful misconduct; or (iii) the due
execution, effectiveness, validity or enforceability of any document or
instrument related to any Letter of Credit or Letter of Credit Application.
The Related Borrower hereby assumes all risks of the
46
acts or omissions of any beneficiary or transferee with respect to its use of
any Letter of Credit; provided, however, that this assumption is not intended
to, and shall not, preclude such Related Borrower from pursuing such rights
and remedies as it may have against the beneficiary or transferee at law or
under any other agreement. None of the Issuing Bank, the Administrative Agent,
nor any of the respective correspondents, participants or assignees of such
Issuing Bank, shall be liable or responsible for any of the matters described
in clauses (i) through (v) of Section 2.03(j); provided, however, that
anything in such clauses to the contrary notwithstanding, the Related Borrower
may have a claim against an Issuing Bank, and such Issuing Bank may be liable
to such Related Borrower, to the extent, but only to the extent, of any
direct, as opposed to consequential or exemplary, damages suffered by such
Related Borrower which such Related Borrower proves were caused by such
Issuing Bank's willful misconduct or gross negligence or such Issuing Bank's
willful failure to pay under any Letter of Credit after the presentation to it
by the beneficiary of a sight draft and certificate(s) strictly complying with
the terms and conditions of a Letter of Credit. In furtherance and not in
limitation of the foregoing, an Issuing Bank may accept documents that appear
on their face to be in order, without responsibility for further
investigation, regardless of any notice or information to the contrary, and
such Issuing Bank shall not be responsible for the validity or sufficiency of
any instrument transferring or assigning or purporting to transfer or assign a
Letter of Credit or the rights or benefits thereunder or proceeds thereof, in
whole or in part, which may prove to be invalid or ineffective for any reason.
(e) Cash Collateral. Upon the occurrence and during the continuance of
any Event of Default, at the request of the Administrative Agent, (i) if an
Issuing Bank has honored any full or partial drawing request under any Letter
of Credit and such drawing has resulted in a L/C Borrowing, or (ii) if, as of
the Letter of Credit Expiration Date (or, if the expiry date of such Letter of
Credit is after the Letter of Credit Expiration Date (as may be agreed by the
Revolving Lenders in accordance with Section 2.01(g)), as of such later expiry
date), any Letter of Credit for any reason remains outstanding and partially
or wholly undrawn, AYE shall immediately Cash Collateralize the then
Outstanding Amount of all L/C Obligations (in an amount equal to such
Outstanding Amount determined as of the date of such L/C Borrowing or the
Letter of Credit Expiration Date (or such later date as may be agreed by the
Revolving Lenders in accordance with Section 2.01(g)), as the case may be).
AYE hereby grants to the Administrative Agent, for the benefit of each Issuing
Bank and the Revolving Lenders, a security interest in all such cash, deposit
accounts and all balances held in the Cash Collateral Account and all proceeds
of the foregoing. Upon the drawing of any Letter of Credit for which funds are
on deposit as Cash Collateral, such funds shall be applied, to the extent
permitted under Applicable Law, to reimburse each Issuing Bank.
(f) Applicability of ISP and UCP. Unless otherwise expressly agreed by
an Issuing Bank and the Related Borrower upon issuing an L/C Credit Extension
(including any such agreement applicable to Existing L/Cs), (i) the rules of
the ISP shall apply to each Standby Letter of Credit, and (ii) the rules of
the Uniform Customs and Practice for Documentary Credits, as most recently
published by the International Chamber of Commerce at the time of issuance
shall apply to each Trade Letter of Credit.
(g) Conflict with Issuer Documents. In the event of any conflict between
the terms hereof and the terms of any Issuer Document, the terms hereof shall
control.
47
(h) Letters of Credit Issued for Subsidiaries. Notwithstanding that a
Letter of Credit issued or outstanding hereunder is in support of any
Obligations of, or is for the account of, a Subsidiary, the Related Borrower
shall be obligated to reimburse the Issuing Bank hereunder for any and all
drawings under such Letter of Credit. The Related Borrower hereby acknowledges
that the L/C Credit Extensions for the account of Subsidiaries inures to the
benefit of such Related Borrower, and that such Related Borrower's business
derives substantial benefits from the businesses of such Subsidiaries.
(i) Letter of Credit Reports. Each Issuing Bank shall furnish (A) to the
Administrative Agent on the first Business Day of each month a written report
summarizing issuance and expiration dates of L/C Credit Extensions issued
during the preceding month and drawings during such month under each Letter of
Credit and (B) to the Administrative Agent and each Revolving Lender on the
first Business Day of each calendar quarter a written report setting forth the
average daily aggregate L/C Obligations during the preceding calendar quarter
of all Letters of Credit.
(j) Obligations Absolute. The obligation of the Related Borrower to
reimburse each Issuing Bank for each drawing under each Letter of Credit and
to repay each L/C Borrowing shall be absolute, unconditional and irrevocable,
and shall be paid strictly in accordance with the terms of this Agreement
under all circumstances, including the following:
(i) any lack of validity or enforceability of such Letter
of Credit, this Agreement, or any other Loan Document;
(ii) the existence of any claim, counterclaim, setoff,
defense or other right that the Related Borrower or any
Subsidiary may have at any time against any beneficiary or any
transferee of such Letter of Credit (or any Person for whom any
such beneficiary or any such transferee may be acting), such
Issuing Bank or any other Person, whether in connection with
this Agreement, the transactions contemplated hereby or by such
Letter of Credit or any agreement or instrument relating
thereto, or any unrelated transaction;
(iii) any draft, demand, certificate or other document
presented under such Letter of Credit proving to be forged,
fraudulent, invalid or insufficient in any respect or any
statement therein being untrue or inaccurate in any respect; or
any loss or delay in the transmission or otherwise of any
document required in order to make a drawing under such Letter
of Credit;
(iv) any payment by such Issuing Bank under such Letter of
Credit against presentation of a draft or certificate that does
not strictly comply with the terms of such Letter of Credit (so
long as such draft or certificate substantially complies with
such terms); or any payment made by such Issuing Bank under such
Letter of Credit to any Person purporting to be a trustee in
bankruptcy, debtor-in-possession, assignee for the benefit of
creditors, liquidator, receiver or other representative of or
successor to any beneficiary or any transferee of such Letter of
Credit; or
48
(v) any other circumstance or happening whatsoever,
whether or not similar to any of the foregoing, including any
other circumstance that might otherwise constitute a defense
available to, or a discharge of, the Related Borrower.
The Related Borrower shall promptly examine a copy of each Letter of
Credit and each amendment thereto that is delivered to it pursuant to Section
2.03(a)(iv) and, in the event of any claim of noncompliance with such Related
Borrower's instructions or other irregularity, such Related Borrower will
immediately notify the Issuing Bank. The Related Borrower shall be
conclusively deemed to have waived any such claim against the Issuing Bank and
its correspondents unless such notice is given as aforesaid.
(k) Acts and Omissions of Beneficiaries. Each Borrower assumes all risks
of the acts or omissions of any beneficiary or transferee of any Letter of
Credit issued at its request with respect to its use of such Letter of Credit.
Neither any Issuing Bank, any of its Affiliates, nor any of its respective
officers, directors, agents, employees, attorneys and advisors shall be liable
or responsible for: (i) the use that may be made of any Letter of Credit or
any acts or omissions of any beneficiary or transferee in connection
therewith; (ii) the validity, sufficiency or genuineness of documents, or of
any endorsement thereon, even if such documents should prove to be in any or
all respects invalid, insufficient, fraudulent or forged; (iii) payment by
such Issuing Bank against presentation of documents that do not comply with
the terms of any Letter of Credit, including failure of any documents to bear
any reference or adequate reference to any Letter of Credit; or (iv) any other
circumstances whatsoever in making or failing to make payment under any Letter
of Credit, except that the relevant Borrower shall have a claim against such
Issuing Bank, and such Issuing Bank shall be liable to such Borrower, to the
extent of any direct, but not consequential, damages suffered by such Borrower
that such Borrower proves were primarily caused by (A) such Issuing Bank's
willful misconduct or gross negligence as determined in a final,
non-appealable judgment by a court of competent jurisdiction in determining
whether documents presented under any Letter of Credit comply with the terms
thereof or (B) such Issuing Bank's willful failure to make lawful payment
under any Letter of Credit after the presentation to it of a draft and
certificates strictly complying with the terms and conditions of any Letter of
Credit. In furtherance and not in limitation of the foregoing, such Issuing
Bank may accept documents that appear on their face to be in order, without
responsibility for further investigation, regardless of any notice or
information to the contrary.
SECTION 2.04. Repayment of Advances. Each Borrower shall repay to the
Administrative Agent for the ratable account of the Lenders on the Final
Maturity Date the aggregate principal amount of all Advances made to such
Borrower and which are then outstanding. Without prejudice to the foregoing,
AYE shall repay to the Administrative Agent for the ratable account of the
Term Lenders the aggregate principal amount of all Term Advances in
consecutive quarterly installments. The initial such installment shall be due
and payable on September 30, 2006, and each installment thereafter shall be
due and payable on each Quarterly Date occurring thereafter. Each such
installment shall be in an amount equal to 0.25% of the aggregate principal
amount of all Term Advances as of the date such Term Advances were disbursed
to AYE.
SECTION 2.05. Termination or Reduction of the Commitments. (a) Optional.
AYE may, upon at least three Business Days' notice to the Administrative
Agent, terminate in
49
whole or reduce in part the unused portion of the Revolving Commitments;
provided that (i) each partial reduction of a Facility shall be in an
aggregate amount of $2,000,000 or an integral multiple of $1,000,000 in excess
thereof and (ii) each partial reduction of a Facility shall be made ratably
among the Appropriate Lenders in accordance with their respective Commitments
with respect to such Facility.
(b) Mandatory. (i) So long as the Revolving Facility is in excess of
$250,000,000, the Revolving Facility shall be automatically and permanently
reduced on each date on which prepayment of outstanding L/C Borrowings and
Revolving Advances is required to be made pursuant to Section 2.06(b) by an
amount equal to the applicable Reduction Amount (or portion thereof); provided
that, for the avoidance of doubt, reduction of the Revolving Facility pursuant
to this clause (i) shall cease when the Revolving Facility is equal to
$250,000,000.
(ii) All unused Term Commitments shall terminate on the earlier to occur
of (a) the Closing Date (after giving effect to the Term Borrowing made on
such date) or (b) the termination in full of the Term Commitments in
accordance with Section 6.01 (such date, the "Term Commitment Termination
Date").
(iii) The Revolving Commitments shall terminate on the earlier to occur
of (a) 5:00 p.m. (New York City time) on the Final Maturity Date, (b) the
termination in full of the Revolving Commitments pursuant to Section 2.05(a),
or (c) the termination of the Revolving Commitments in accordance with Section
6.01.
SECTION 2.06. Prepayments. (a) Optional. Each Borrower may, with respect
to Advances made to it, upon at least one Business Day's notice in the case of
Base Rate Advances and three Business Days' notice in the case of Eurodollar
Rate Advances, in each case to the Administrative Agent stating the proposed
date and aggregate principal amount of the prepayment, and if such notice is
given such Borrower shall, prepay the outstanding aggregate principal amount
of the Advances comprising part of the same Borrowing in whole or ratably in
part, together with accrued interest to the date of such prepayment on the
aggregate principal amount prepaid; provided that (i) each partial prepayment
shall be in an aggregate principal amount of $2,000,000 or an integral
multiple of $1,000,000 in excess thereof and (ii) if any prepayment of a
Eurodollar Rate Advance is made on a date other than the last day of an
Interest Period for such Advance, such Borrower shall also pay any amounts
owing pursuant to Section 8.04(d). Any optional prepayment by AYE of the Term
Advances under this Section 2.06(a) shall be applied to the remaining
amortization installments of the Term Facility in any one of the following
manners, as directed by AYE in writing to the Administrative Agent (or, in the
absence of any such direction received by the Administrative Agent prior to
the relevant prepayment date, in accordance with clause (i) below): (i) in
inverse order of maturity with respect to the remaining amortization
installments, (ii) to all remaining amortization installments on a pro rata
basis or (iii) to the next succeeding four amortization installments as of the
date of such prepayment in direct order of maturity as among such four
installments and, thereafter, to the remaining amortization installments on a
pro rata basis.
(b) Mandatory. Upon any sale, transfer or other disposition of any
Assets by AYE, its Regulated Subsidiaries or any Buffalo Creek SPV, AYE shall
prepay an aggregate
50
principal amount of the Advances equal to 75% of the Net Cash Proceeds
received therefrom promptly upon receipt thereof by AYE, such Regulated
Subsidiary or Buffalo Creek SPV, as applicable; provided that the foregoing
shall not apply to (i) any sale, lease, transfer or other disposition of any
Asset of AYE, any Regulated Subsidiary or Buffalo Creek SPV, as applicable,
permitted under Sections 5.02(e)(i) through 5.02(e)(v), 5.02(e)(vii),
5.02(e)(viii) or 5.02(e)(xii), (ii) any issuance of any Equity Interest
(including any capital contribution) by (A) AYE or any of its Regulated
Subsidiaries or (B) any Buffalo Creek SPV to any direct or indirect wholly
owned Subsidiary of AYE, and in the case of clauses (A) and (B) above, as
permitted under Section 5.02(e)(x) or 5.02(e)(xi), (iii) any sale, transfer or
other disposition of Assets of less than $2,000,000 individually or
$10,000,000 in the aggregate in any fiscal year or (iv) any lease or other
disposition of Assets of a Buffalo Creek SPV pursuant to which (x) title to
such Assets remains with AYE or a Buffalo Creek SPV which is a direct or
indirect wholly owned Subsidiary of AYE or (y) royalty payments are received
in connection with the Buffalo Reserve Project; provided further
notwithstanding anything to the contrary in this clause (b), (x) AYE, its
Regulated Subsidiaries and any Buffalo Creek SPV shall be entitled to retain
the first $100,000,000 of Net Cash Proceeds from any other sale, transfer or
other disposition in respect of any of the Assets of AYE, its Regulated
Subsidiaries or any Buffalo Creek SPV received by AYE, its Regulated
Subsidiaries and any Buffalo Creek SPV in the aggregate plus an amount equal
to (A) the aggregate principal amount of the Term Facility optionally prepaid
by AYE pursuant to Section 2.06(a) and (B) the aggregate amount of any
optional prepayment of the Revolving Facility pursuant to Section 2.06(a) (if
and to the extent the Revolving Commitments are terminated by AYE concurrently
with such prepayment by AYE pursuant to Section 2.05(a)), in the case of
clauses (A) and (B) above, so long as such prepayment was funded with the
proceeds of any sale, transfer or other disposition of any Asset by AYE, any
Regulated Subsidiary or any Buffalo Creek SPV not otherwise required to be
applied to mandatorily prepay the Advances in accordance with this Section
2.06(b), and shall not be required to repay Term Advances, L/C Borrowings or
Revolving Advances or Cash Collateralize L/C Obligations pursuant to this
Section 2.06(b) with such proceeds and (y) AYE, its Regulated Subsidiaries and
Buffalo Creek SPVs shall be entitled to retain the first $10,000,000 of Net
Cash Proceeds from any sale, transfer or other disposition (other than any
lease or other disposition of the Assets of a Buffalo Creek SPV pursuant to
which (A) title to such Assets remains with AYE or a Buffalo Creek SPV which
is a direct or indirect wholly owned Subsidiary of AYE or (B) royalty payments
are received in connection with the Buffalo Reserve Project, in each case,
with respect to which no prepayment shall be required) in respect of the
Buffalo Creek Project or Assets of any Buffalo Creek SPV received by AYE, its
Regulated Subsidiaries and Buffalo Creek SPVs in the aggregate. Prepayments
pursuant to this Section 2.06(b) shall be applied first, to repay Term
Advances outstanding at such time until all such Term Advances are paid in
full, second, to repay L/C Borrowings outstanding at such time until all such
L/C Borrowings are paid in full, third, to repay Revolving Advances
outstanding at such time until all such Revolving Advances are paid in full,
and fourth, to Cash Collateralize the L/C Obligations (the sum of such
prepayment amounts, cancellation of Term Commitments and Cash
Collateralization amounts being the "Reduction Amount").
(c) Other Amounts. Concurrently with any prepayment of Advances under this
Section 2.06 by any Borrower, such Borrower shall pay to the applicable Lender
or Issuing Bank, all accrued fees, costs and expenses, accrued interest
thereon, if any, and any other
51
amounts due under the Loan Documents in respect of the principal amount of the
Advances or L/C Borrowings so prepaid, including pursuant to Section 8.04(e).
SECTION 2.07. Interest. (a) Scheduled Interest. Each Borrower shall pay
interest on the unpaid principal amount of each Advance made to it and owing
to each Lender from the date of such Advance until such principal amount shall
be paid in full, at the following rates per annum:
(i) Base Rate Advances. During such periods as such
Advance is a Base Rate Advance, a rate per annum equal at all
times to the sum of (A) the Base Rate in effect from time to
time plus (B) the Applicable Margin in effect from time to time,
payable in arrears each Quarterly Date during such periods and
on the date such Base Rate Advance shall be Converted or paid in
full.
(ii) Eurodollar Rate Advances. During such periods as such
Advance is a Eurodollar Rate Advance, a rate per annum equal at
all times during each Interest Period for such Advance to the
sum of (A) the Eurodollar Rate for such Interest Period for such
Advance plus (B) the Applicable Margin in effect from time to
time, payable in arrears on the last day of such Interest Period
and, if such Interest Period has a duration of more than three
months, on such day that occurs during such Interest Period
every three months from the date of such Interest Period and on
the date such Eurodollar Rate Advance shall be Converted or paid
in full.
(b) Default Interest. Upon the occurrence and during the continuance of
an Event of Default, each Borrower shall pay interest on (i) the unpaid and
overdue principal amount of each Advance made to it and owing to each Lender,
payable in arrears on the dates referred to in clause (a)(i) or (a)(ii) above
and on demand, at a rate per annum equal at all times to 2% per annum above
the rate per annum required to be paid on such Advance pursuant to clause
(a)(i) or (a)(ii) above and (ii) to the fullest extent permitted by Applicable
Law, the amount of any interest, fee or other amount payable by such Borrower
under the Loan Documents that is not paid by it when due, from the date such
amount shall be due until such amount shall be paid in full, payable in
arrears on the date such amount shall be paid in full and on demand, at a rate
per annum equal at all times to 2% per annum above the rate per annum required
to be paid, in the case of interest, on the Type of Advance on which such
interest has accrued pursuant to clause (a)(i) or (a)(ii) above and, in all
other cases, on Base Rate Advances pursuant to clause (a)(i) above.
(c) Notice of Interest Period and Interest Rate. Promptly after receipt
of a Notice of Borrowing pursuant to Section 2.02(a), a Notice of
Conversion/Continuation pursuant to Section 2.10(a)(ii) or a notice of
selection of an Interest Period pursuant to the terms of the definition of
"Interest Period", in each case, from any Borrower, the Administrative Agent
shall give notice to such Borrower and each Lender of the applicable Interest
Period and the applicable interest rate determined by the Administrative Agent
for purposes of clause (a)(i) or (a)(ii) above.
SECTION 2.08. Fees. (a) Commitment Fee. AYE shall pay to the
Administrative Agent for the account of the Revolving Lenders a commitment fee
from the date
52
hereof in the case of each Initial Lender holding a Revolving Commitment and
from the effective date specified in the Assignment and Acceptance pursuant to
which it became a Revolving Lender in the case of each other Revolving Lender
until the Final Maturity Date, commencing on the Closing Date, and payable
quarterly in arrears on the first Business Day after the end of each Quarterly
Date and on the Final Maturity Date, at the Commitment Fee Rate on the sum of
the average daily Unused Commitment of such Revolving Lender during such
fiscal quarter.
(b) Letter of Credit Fees. The Related Borrower shall pay to the
Administrative Agent for the account of each Revolving Lender in accordance
with its Pro Rata Share a Letter of Credit fee (the "Letter of Credit Fee")
for each Letter of Credit equal to the Applicable Margin for Eurodollar Rate
Advances from time to time multiplied by the daily maximum amount available to
be drawn under such Letter of Credit (whether or not such maximum amount is
then in effect under such Letter of Credit). Letter of Credit Fees shall be
(i) computed on a quarterly basis in arrears and (ii) due and payable on the
first Business Day after the end of each Quarterly Date, commencing with the
first such date to occur after the issuance of such Letter of Credit, on the
Letter of Credit Expiration Date and thereafter on demand. If there is any
change in the Applicable Margin during any quarter, the daily maximum amount
of each Letter of Credit Fee shall be computed and multiplied by the
Applicable Margin separately for each period during such quarter that such
Applicable Margin was in effect. Notwithstanding anything to the contrary
contained herein, upon the request of the Required Revolving Lenders, while
any Default exists, all Letter of Credit Fees shall accrue at the Applicable
Margin plus 2%.
(c) Fronting Fee and Documentary and Processing Charges Payable to
Issuing Bank, Etc. The Related Borrower shall pay directly to the relevant
Issuing Bank for its own account a fronting fee with respect to each Letter of
Credit issued at the request of such Related Borrower in the amount equal to
0.10% of the L/C Obligations (whether or not such maximum amount is then in
effect under such Letter of Credit) (the "Fronting Fee"). The Fronting Fee
shall be computed on a quarterly basis in arrears and shall be due and payable
on each Quarterly Date, commencing with the first such date to occur after the
issuance of such Letter of Credit, on the Letter of Credit Expiration Date and
thereafter on demand. In addition, the Related Borrower shall, with respect to
all Letters of Credit issued at its request, pay directly to the Issuing Bank
for its own account the customary issuance, presentation, amendment and other
processing fees, and other standard costs and charges, of such Issuing Bank
relating to letters of credit as from time to time in effect. Such customary
fees and standard costs and charges are due and payable on demand and are
nonrefundable.
(d) Agent Fees. AYE shall pay to the Administrative Agent for their own
account such fees as may from time to time be agreed between AYE and the
Administrative Agent.
SECTION 2.09. Illegality. Notwithstanding any other provision of this
Agreement, if the introduction of or any change in or in the interpretation of
any law or regulation shall make it unlawful, or any central bank or other
Governmental Authority shall assert that it is unlawful, for any Lender or its
Eurodollar Lending Office to perform its obligations hereunder to make
Eurodollar Rate Advances or to continue to fund or maintain Eurodollar Rate
Advances hereunder, then, on notice thereof and demand therefor by such Lender
to AYE through the Administrative Agent, (i) each Eurodollar Rate Advance will
53
automatically, upon such demand, Convert into a Base Rate Advance and (ii) the
obligation of such Lender to make, or to Convert Advances into, Eurodollar
Rate Advances shall be suspended until the Administrative Agent shall notify
AYE that such Lender has determined that the circumstances causing such
suspension no longer exist; provided that, before making any such demand, such
Lender agrees to use reasonable efforts (consistent with its internal policy
and legal and regulatory restrictions) to designate a different Eurodollar
Lending Office if the making of such a designation would allow such Lender or
its Eurodollar Lending Office to continue to perform its obligations to make
Eurodollar Rate Advances or to continue to fund or maintain Eurodollar Rate
Advances and would not, in the judgment of such Lender, be otherwise
disadvantageous to such Lender.
SECTION 2.10. Interest Elections. (a) Optional. (i) Each Borrower may on
any Business Day elect to Convert all or any portion of the Advances
comprising the same Borrowing made to such Borrower from one Type into
Advances of the other Type, and in the case of Eurodollar Rate Advances, may
elect Interest Periods therefor, all as provided in this Section 2.10. Each
Borrower may elect different options with respect to different portions of the
Borrowing made to such Borrower, in which case each such portion shall be
allocated ratably among the Lender Parties in accordance with their
Commitments. At no time shall the total number of different Interest Periods
for all Eurodollar Rate Advances outstanding exceed ten.
(ii) To make an election pursuant to this Section 2.10(a), a Borrower
shall give the Administrative Agent prior written notice (or telephonic notice
promptly confirmed in writing) by telecopier or electronic mail (a "Notice of
Conversion/Continuation") of the Conversion or Continuation, as the case may
be, (i) by 1:00 p.m. (New York City time) on the requested date of a
Conversion into Base Rate Advances and (ii) by 12:00 noon (New York City time)
three Business Days prior to a Continuation of or Conversion into Eurodollar
Rate Advances; provided, however, that any Conversion of Eurodollar Rate
Advances into Base Rate Advances shall be made only on the last day of an
Interest Period for such Eurodollar Rate Advances, any Conversion of Base Rate
Advances into Eurodollar Rate Advances shall be in an amount not less than the
minimum amount specified in Section 2.02(b), no Conversion of any Advances
shall result in more separate Borrowings than permitted under Section 2.02(b)
and each Conversion of Advances comprising part of the same Borrowing shall be
made ratably among the Lender Parties in accordance with their Commitments.
Each such Notice of Conversion/Continuation shall be irrevocable and shall
specify (A) if different options are being elected with respect to different
portions of the Borrowings, the portions thereof that are to be allocated to
each resulting election (in which case the information to be specified
pursuant to clauses (C) and (D) shall be specified for each resulting
portion); (B) the effective date of the election made pursuant to such Notice
of Conversion/Continuation, which shall be a Business Day; (C) whether the
resulting Borrowings are to be comprised of Base Rate Advances or Eurodollar
Rate Advances; and (D) if the resulting Borrowings are to be comprised of
Eurodollar Rate Advances, the Interest Period applicable thereto after giving
effect to such election, which shall be a period contemplated by the
definition of "Interest Period". If any such Notice of Conversion/Continuation
requests that the relevant Borrowing be comprised of Eurodollar Rate Advances
but does not specify an Interest Period, such Borrower shall be deemed to have
selected an Interest Period of one month. Each Notice of
Conversion/Continuation shall be irrevocable and binding on the Borrower
issuing such notice.
54
(iii) If, on the expiration of any Interest Period in respect of any
Eurodollar Rate Advances made to a Borrower, such Borrower shall have failed
to deliver a Notice of Conversion/Continuation, then, unless such Advances are
repaid as provided herein, such Borrower shall be deemed to have elected to
Convert such Advances to Base Rate Advances. No Advances may be Converted
into, or Continued as, Eurodollar Rate Advances if an Event of Default has
occurred and is continuing, unless the Administrative Agent and the Required
Lenders shall have otherwise consented in writing.
(iv) Upon receipt of any Notice of Conversion/Continuation, the
Administrative Agent shall promptly notify each Lender Party of the details
thereof and of such Lender Party's ratable share of each election.
(b) Mandatory. (i) On the date on which the aggregate unpaid principal
amount of Eurodollar Rate Advances comprising any Borrowing shall be reduced,
by payment or prepayment or otherwise, to less than $2,000,000 such Advances
shall automatically Convert into Base Rate Advances.
(ii) If any Borrower shall fail to select the duration of any Interest
Period for any Eurodollar Rate Advances to be made to it in accordance with
the provisions contained in the definition of "Interest Period" in Section
1.01, the Administrative Agent shall forthwith so notify AYE and the Lenders,
whereupon each such Eurodollar Rate Advance shall automatically, on the last
day of the then existing Interest Period therefor, Convert into a Base Rate
Advance.
(iii) Upon the occurrence and during the continuance of any Event of
Default, (A) each Eurodollar Rate Advance will automatically, on the last day
of the then existing Interest Period therefor, Convert into a Base Rate
Advance and (B) the obligation of the Lenders to make, or to Convert Advances
into, Eurodollar Rate Advances shall be suspended.
SECTION 2.11. Increased Costs, Etc. (a) If, due to either (i) the
introduction of or any change (other than any change by way of imposition or
increase of reserve requirements included in the Eurodollar Rate Reserve
Percentage) in or in the interpretation of any law or regulation or (ii) the
compliance with any guideline or request from any central bank or other
Governmental Authority (whether or not having the force of law), there shall
be any increase in the cost to any Lender Party of agreeing to make or of
making, funding or maintaining Eurodollar Rate Advances to any Borrower or of
agreeing to maintain or participate in the L/C Credit Extensions or of
agreeing to make or of making or funding or maintaining L/C Credit Extensions
to any Borrower (excluding, for purposes of this Section 2.11, any such
increased costs resulting from (A) Taxes or Other Taxes (as to which Section
2.13 shall govern) and (B) changes in the basis of taxation of overall net
income or overall gross income by the United States or by the foreign
jurisdiction or state under the laws of which such Lender Party is organized
or has its Applicable Lending Office or any political subdivision thereof),
then such Borrower shall from time to time, upon demand by such Lender Party
(with a copy of such demand to the Administrative Agent), pay to the
Administrative Agent for the account of such Lender Party additional amounts
sufficient to compensate such Lender Party for such increased cost; provided,
however, that a Lender Party claiming additional amounts under this Section
2.11(a) agrees to use reasonable efforts (consistent with its internal policy
and legal and regulatory restrictions) to designate a different Applicable
Lending Office if the making of such
55
a designation would avoid the need for, or reduce the amount of, such
increased cost that may thereafter accrue and would not, in the reasonable
judgment of such Lender Party, be otherwise disadvantageous to such Lender
Party. A certificate as to the amount of such increased cost, submitted to AYE
by such Lender Party, shall be conclusive and binding for all purposes, absent
manifest error.
(b) If any Lender Party determines that compliance 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) affects or
would affect the amount of capital required or expected to be maintained by
such Lender Party or any corporation controlling such Lender Party and that
the amount of such capital is increased by or based upon the existence of such
Lender Party's commitment to lend or to participate in the making of L/C
Credit Extensions hereunder and other commitments of such type or the
maintenance of or participation in the L/C Credit Extensions (or similar
contingent obligations), then, upon demand by such Lender Party or such
corporation (with a copy of such demand to the Administrative Agent), AYE
shall pay to the Administrative Agent for the account of such Lender Party,
from time to time as specified by such Lender Party, additional amounts
sufficient to compensate such Lender Party in the light of such circumstances,
to the extent that such Lender Party reasonably determines such increase in
capital to be allocable to the existence of such Lender Party's commitment to
lend or to participate in the L/C Credit Extensions or to the issuance or
maintenance of or participation in L/C Credit Extensions. A certificate as to
such amounts submitted to AYE by such Lender Party shall be conclusive and
binding for all purposes, absent manifest error.
(c) If, with respect to any Eurodollar Rate Advances made to any
Borrower the Required Lenders notify the Administrative Agent that the
Eurodollar Rate for any Interest Period for such Advances will not adequately
reflect the cost to such Lenders of making, funding or maintaining their
Eurodollar Rate Advances for such Interest Period, the Administrative Agent
shall forthwith so notify AYE and the Lenders, whereupon (i) each such
Eurodollar Rate Advance will automatically, on the last day of the then
existing Interest Period therefor, Convert into a Base Rate Advance and (ii)
the obligation of the Lenders to make, or to Convert Advances into, Eurodollar
Rate Advances shall be suspended until the Administrative Agent shall notify
AYE that such Lenders have determined that the circumstances causing such
suspension no longer exist.
SECTION 2.12. Payments and Computations. (a) Each Borrower shall make
each payment hereunder and under the Notes required of it, regardless of any
right of counterclaim or setoff, not later than 12:00 noon (New York City
time) on the day when due in Dollars to the Administrative Agent at the
Administrative Agent's Account in immediately available funds, with payments
being received by the Administrative Agent after such time being deemed to
have been received on the next succeeding Business Day. The Administrative
Agent will promptly thereafter cause like funds to be distributed (i) if such
payment by such Borrower is in respect of principal, interest, commitment fees
or any other Obligation then payable hereunder by such Borrower and under its
Notes to more than one Lender Party, to such Lender Parties for the account of
their respective Applicable Lending Offices ratably in accordance with the
amounts of such respective Obligations then payable to such Lender Parties and
(ii) if such payment by such Borrower is in respect of any Obligation then
payable hereunder to one Lender Party, to such Lender Party for the account of
its Applicable Lending Office, in each case to be
56
applied in accordance with the terms of this Agreement. Upon its acceptance of
an Assignment and Acceptance and recording of the information contained
therein in the Register pursuant to Section 8.07(e), from and after the
effective date of such Assignment and Acceptance, the Administrative Agent
shall make all payments hereunder and under the Notes in respect of the
interest assigned thereby to the Lender Party assignee thereunder, and the
parties to such Assignment and Acceptance shall make all appropriate
adjustments in such payments for periods prior to such effective date directly
between themselves.
(b) Each Borrower hereby authorizes each Lender Party and each of its
Affiliates, if and to the extent payment owed to such Lender Party by such
Borrower is not made when due hereunder or, in the case of a Lender, under its
Note or Notes, to charge from time to time, to the fullest extent permitted by
law, against any or all of such Borrower's accounts with such Lender Party or
such Affiliate any amount so due.
(c) All computations of interest based on the Base Rate or the Federal
Funds Rate shall be made by the Administrative Agent on the basis of a year of
365 or 366 days, as the case may be, and all computations of interest based on
the Eurodollar Rate and of fees shall be made by the Administrative Agent on
the basis of a year of 360 days, in each case for the actual number of days
(including the first day but excluding the last day) occurring in the period
for which such interest, fees or commissions are payable. Each determination
by the Administrative Agent of an interest rate, fee or commission hereunder
shall be conclusive and binding for all purposes, absent manifest error.
(d) 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 commitment fee, as the
case may be; provided that, if such extension would cause payment of interest
on or principal of Eurodollar Rate Advances to be made in the next following
calendar month, such payment shall be made on the next preceding Business Day.
(e) Unless the Administrative Agent shall have received notice from AYE
prior to the date on which any payment is due by any Borrower to any Lender
Party hereunder that such Borrower will not make such payment in full, the
Administrative Agent may assume that such 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 such
Lender Party on such due date an amount equal to the amount then due such
Lender Party. If and to the extent such Borrower shall not have so made such
payment in full to the Administrative Agent, each such Lender Party shall
repay to the Administrative Agent forthwith on demand such amount distributed
to such Lender Party together with interest thereon, for each day from the
date such amount is distributed to such Lender Party until the date such
Lender Party repays such amount to the Administrative Agent, at the Federal
Funds Rate.
(f) If the Administrative Agent receives funds from any Borrower for
application to the Obligations of such Borrower under the Loan Documents under
circumstances for which the Loan Documents do not specify the Advances or the
Facility to which, or the manner in which, such funds are to be applied, the
Administrative Agent may, but shall not be obligated to, elect to distribute
such funds to each Lender Party ratably in accordance with such
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Lender Party's proportionate share of the principal amount of all outstanding
Advances of such Borrower and the L/C Obligations relating to such Borrower
then outstanding, in repayment or prepayment of such of the outstanding
Advances or other Obligations owed by such Borrower to such Lender Party, and
for application to such principal installments, as the Administrative Agent
shall direct; provided that no Borrower shall be liable to any Lender Party
with respect to any such distribution by the Administrative Agent.
(g) If any Lender Party shall obtain any payment (whether voluntary,
involuntary, through the exercise of any right of set-off, or otherwise),
other than pursuant to Section 2.09, 2.11 or 2.13, as a result of an
assignment pursuant to Section 8.07 or as a result of the payment of an
Amendment Fee which has been offered to or is available to all Lender Parties
on the same terms, (a) on account of Obligations due and payable to such
Lender Party hereunder and under the Notes at such time in excess of its
ratable share (according to the proportion of (i) the amount of such
Obligations due and payable to such Lender Party at such time to (ii) the
aggregate amount of the Obligations due and payable to all Lender Parties
hereunder and under the Notes at such time) of payments on account of the
Obligations due and payable to all Lender Parties hereunder and under the
Notes at such time obtained by all the Lender Parties at such time or (b) on
account of Obligations owing (but not due and payable) to such Lender Party
hereunder and under the Notes at such time in excess of its ratable share
(according to the proportion of (i) the amount of such Obligations owing to
such Lender Party at such time to (ii) the aggregate amount of the Obligations
owing (but not due and payable) to all Lender Parties hereunder and under the
Notes at such time) of payments on account of the Obligations owing (but not
due and payable) to all Lender Parties hereunder and under the Notes at such
time obtained by all of the Lender Parties at such time, such Lender Party
shall forthwith purchase from the other Lender Parties such interests or
participating interests in the Obligations due and payable or owing to them,
as the case may be, as shall be necessary to cause such purchasing Lender
Party to share the excess payment ratably with each of them; provided that if
all or any portion of such excess payment is thereafter recovered from such
purchasing Lender Party, such purchase from each other Lender Party shall be
rescinded and such other Lender Party shall repay to the purchasing Lender
Party the purchase price to the extent of such Lender Party's ratable share
(according to the proportion of (i) the purchase price paid to such Lender
Party to (ii) the aggregate purchase price paid to all Lender Parties) of such
recovery together with an amount equal to such Lender Party's ratable share
(according to the proportion of (i) the amount of such other Lender Party's
required repayment to (ii) the total amount so recovered from the purchasing
Lender Party) of any interest or other amount paid or payable by the
purchasing Lender Party in respect of the total amount so recovered. Each
Borrower agrees that any Lender Party so purchasing an interest or
participating interest from another Lender Party pursuant to this Section 2.12
may, to the fullest extent permitted by Applicable Law, exercise all its
rights of payment (including the right of set-off) with respect to such
interest or participating interest, as the case may be, as fully as if such
Lender Party were the direct creditor of such Borrower in the amount of such
interest or participating interest, as the case may be.
SECTION 2.13. Taxes. (a) Any and all payments by each Borrower hereunder
or under the Notes shall be made, in accordance with Section 2.12, free and
clear of and without deduction for any and all present or future withholding
taxes, including levies, imposts, deductions, charges or withholdings, and all
liabilities with respect thereto, excluding, in the case of each Lender Party
and the Administrative Agent, as the case may be, (i) taxes imposed on (or
58
measured by) its overall net income, or any franchise taxes or similar taxes
imposed for the privilege of carrying on a business in corporate form (other
than taxes imposed as a result of entering into this Agreement and the
transactions contemplated hereby), or taxes measured by its net worth or
shareholder's capital, by the United States, or by the jurisdiction under the
laws of which such recipient is organized or in which its Applicable Lending
Office is located, (ii) any branch profits taxes imposed by the United States
or any similar tax imposed by any other jurisdiction in which the Applicable
Lending Office of any Lender Party is located and (iii) withholding taxes
excluded pursuant to clause (e) of this Section 2.13 (all such non-excluded
taxes, including levies, imposts, deductions, charges, withholdings and
liabilities in respect of payments hereunder or under the Notes being
hereinafter referred to as "Taxes"). If any Borrower shall be required by law
to deduct any Taxes from or in respect of any sum payable hereunder or under
any of the Notes to any Lender Party or the Administrative Agent, (A) the sum
payable by such Borrower shall be increased as may be necessary so that after
such Borrower and the Administrative Agent have made all required deductions
(including deductions applicable to additional sums payable under this Section
2.13) such Lender Party 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, (B) such Borrower shall make all such deductions and (C)
such Borrower shall pay the full amount deducted to the relevant taxation
authority or other authority in accordance with Applicable Law.
(b) In addition, each Borrower shall pay any present or future stamp,
documentary, excise, property or similar taxes, charges or levies that arise
from any payment made hereunder or under the Notes or from the execution,
delivery or registration of, performance under, or otherwise with respect to,
this Agreement or the Notes, but excluding all other U.S. federal taxes other
than withholding taxes (hereinafter referred to as "Other Taxes"). If revised
disclosure regulations under Section 6011 of the Code are issued which modify
the definition of a "reportable transaction" so that it does not include a
transaction where the issuer of a debt instrument provides an indemnity for
taxes, in addition to withholding taxes imposed on interest paid on the debt
instrument, for purposes of subsections (a) and (b) of this Section 2.13, the
terms "Taxes" and "Other Taxes" shall include all such taxes (other than any
taxes described in clauses (i), (ii) and (iii) of Section 2.13(a) above),
whether or not collected by way of withholding.
(c) Each Borrower shall indemnify each Lender Party and the
Administrative Agent for and hold them harmless against the full amount of
Taxes and Other Taxes, and for the full amount of taxes of any kind imposed by
any jurisdiction on amounts payable under this Section 2.13, imposed on or
paid by such Lender Party or the Administrative Agent (as the case may be) and
any liability (including penalties, additions to tax, interest and reasonable
expenses) arising therefrom or with respect thereto. This indemnification
shall be made within 30 days from the date such Lender Party or the
Administrative Agent (as the case may be) makes written demand therefor.
(d) As soon as practicable (but in no event later than 90 days) after
the date of any payment by any relevant Borrower of Taxes, such Borrower shall
furnish to the Administrative Agent, at its address referred to in Section
8.02, the original or a certified copy of a receipt evidencing such payment.
Excluding payments made by the Administrative Agent, in the case of any
payment hereunder or under the Notes by or on behalf of any relevant Borrower
59
through an account or branch outside the United States or by or on behalf of
any Borrower by a payor that is not a United States person, if such Borrower
determines that no Taxes are payable in respect thereof, such Borrower shall
furnish, or shall cause such payor to furnish, to the Administrative Agent, at
such address, an opinion of counsel acceptable to the Administrative Agent
stating that such payment is exempt from Taxes. For purposes of subsections
(d) and (e) of this Section 2.13, the terms "United States" and "United States
person" shall have the meanings specified in Section 7701 of the Code.
(e) Each Lender Party organized under the laws of a jurisdiction outside
the United States shall, on or prior to the date of its execution and delivery
of this Agreement in the case of each Initial Lender Party and on the date of
the Assignment and Acceptance pursuant to which it becomes a Lender Party in
the case of each other Lender Party, and from time to time thereafter as
requested in writing by AYE (but only so long thereafter as such Lender Party
remains lawfully able to do so), provide each of the Administrative Agent and
AYE with two duly completed copies of (i) Internal Revenue Service Form
W-8ECI, or any successor form thereto, certifying that the payments received
from any Borrower hereunder are effectively connected with such Lender Party's
conduct of a trade or business in the United States; or (ii) Internal Revenue
Service Form W-8BEN, or any successor form thereto, certifying that such
Lender Party is entitled to benefits under an income tax treaty to which the
United States is a party which reduces the rate of withholding tax on payments
of interest; or (iii) Internal Revenue Service Form W-8BEN or any successor
form thereto, together with a certificate stating that (1) the Lender Party is
not a bank for purposes of Code Section 881(c)(3)(A), or the obligation of
each Borrower hereunder is not, with respect to such Lender Party, pursuant to
a loan agreement entered into in the ordinary course of its trade or business,
within the meaning of that Section; (2) the Lender Party is not a 10%
shareholder of any Borrower within the meaning of Code Section 871(h)(3) or
881(c)(3)(B); and (3) the Lender Party is not a controlled foreign corporation
that is related to any Borrower within the meaning of Code Section
881(c)(3)(C); or (iv) such other governmental forms as may be applicable to
the Lender Party, including Forms W-8IMY or W-8EXP, which will reduce the rate
of withholding tax on payments of interest. Each Lender Party organized under
the laws of the United States that is not a corporation shall, on or prior to
the date of its execution and delivery of this Agreement in the case of each
Initial Lender Party and on the date of the Assignment and Acceptance pursuant
to which it becomes a Lender Party in the case of each other Lender Party, and
from time to time as requested in writing by AYE, provide each of the
Administrative Agent and AYE with two duly completed copies of Internal
Revenue Service Form W-9. Each Lender Party shall deliver such forms promptly
upon the obsolescence or invalidity of any form previously delivered by such
Lender Party (but only to the extent such Lender Party is lawfully able to do
so). Each such Lender Party shall promptly notify AYE at any time that it
determines that it is no longer in a position to provide any previously
delivered certificate to AYE (or any other form of certification adopted by
the Internal Revenue Service for such purpose). If the forms provided by a
Lender Party at the time such Lender Party first becomes a party to this
Agreement indicate a United States interest withholding tax rate in excess of
zero, withholding tax at such rate shall be considered excluded from Taxes
unless and until such Lender Party provides the appropriate forms certifying
that a lesser rate applies, whereupon withholding tax at such lesser rate only
shall be considered excluded from Taxes for periods governed by such forms;
provided, however, that if, at the effective date of the Assignment and
Acceptance pursuant to which a Lender Party becomes a party to this Agreement,
the Lender Party assignor was entitled to payments under subsection
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(a) of this Section 2.13 in respect of United States withholding tax with
respect to interest paid at such date, then, to such extent, the term Taxes
shall include (in addition to withholding taxes that may be imposed in the
future or other amounts otherwise includable in Taxes) United States
withholding tax, if any, applicable with respect to the Lender Party assignee
on such date. If any form or document referred to in this subsection (e)
requires the disclosure of information, other than information necessary to
compute the tax payable and information required by the applicable Internal
Revenue Service form (or related certificate described above), that the
applicable Lender Party reasonably considers to be confidential, such Lender
Party shall give notice thereof to AYE and shall not be obligated to include
in such form or document such confidential information.
(f) Notwithstanding the foregoing, for any period with respect to which
a Lender Party has failed to provide AYE with the appropriate form described
in subsection (e) above (other than if such failure is due to a change in law
occurring after the date on which a form originally was required to be
provided or if such form otherwise is not required under subsection (e)
above), such Lender Party shall not be entitled to indemnification under
subsection (a) or (c) of this Section 2.13 with respect to Taxes imposed by
the United States by reason of such failure; provided that should a Lender
Party become subject to Taxes because of its failure to deliver a form
required hereunder, each Borrower shall take such steps as such Lender Party
shall reasonably request to assist such Lender Party to recover such Taxes.
(g) Any Lender Party claiming any additional amounts payable pursuant to
this Section 2.13 agrees to use reasonable efforts (consistent with its
internal policy and legal and regulatory restrictions) to change the
jurisdiction of its Eurodollar Lending Office or Domestic Lending Office if
the making of such a change would avoid the need for, or reduce the amount of,
any such additional amounts that may thereafter accrue and would not, in the
reasonable judgment of such Lender Party, be otherwise disadvantageous to such
Lender Party.
(h) If any Lender Party determines, in its sole discretion, that it has
actually and finally realized, by reason of a refund, deduction or credit of
any Taxes paid or reimbursed by any Borrower pursuant to subsection (a) or (c)
above in respect of payments under the Loan Documents, a current monetary
benefit that it would otherwise not have obtained, and that would result in
the total payments under this Section 2.13 exceeding the amount needed to make
such Lender Party whole, such Lender Party shall pay to such Borrower, with
reasonable promptness following the date on which it actually realizes such
benefit, an amount equal to the lesser of the amount of such benefit or the
amount of such excess, in each case net of all out-of-pocket expenses in
securing such refund, deduction or credit.
SECTION 2.14. Evidence of Debt. (a) Each Lender Party shall maintain in
accordance with its usual practice an account or accounts evidencing the
indebtedness of each Borrower to such Lender Party resulting from the Advances
or L/C Credit Extensions and/or L/C Borrowings owing to such Lender Party from
time to time, including the amounts of principal and interest payable and paid
to such Lender Party from time to time hereunder. Each Borrower agrees that
upon notice by any Lender Party to such Borrower (with a copy of such notice
to the Administrative Agent) to the effect that a promissory note or other
evidence of indebtedness is required or appropriate in order for such Lender
Party to evidence (whether for purposes of enforcement or otherwise) the
Advances or L/C Borrowings owing to, or to be made by, such
61
Lender Party, such Borrower shall promptly execute and deliver to such Lender
Party, with a copy to the Administrative Agent, a Note, in substantially the
form of Exhibit A-1 or Exhibit A-2 hereto, as applicable, payable to the order
of such Lender Party in a principal amount equal to the Advances and/or L/C
Borrowings owing to, or to be made by, such Lender Party. All references to
Notes in the Loan Documents shall mean Notes, if any, issued hereunder.
(b) The Register maintained by the Administrative Agent pursuant to
Section 8.07(e) shall include a control account, and a subsidiary account for
each Lender Party, in which accounts (taken together) shall be recorded (i)
the date and amount of each Advance or L/C Advance or L/C Borrowing made
hereunder (or deemed to be made hereunder), whether such Advance or L/C
Borrowing bears interest at the Base Rate or the Eurodollar Rate, the name of
the Related Borrower for such Advance or L/C Borrowing, and, if appropriate,
the Interest Period applicable thereto; (ii) the terms of each Assignment and
Acceptance delivered to and accepted by it; (iii) the amount of any principal
or interest due and payable or to become due and payable from any Borrower to
each Lender Party; and (iv) the amount of any sums received by the
Administrative Agent from any Borrower hereunder and each Lender Party's share
thereof.
(c) Entries made in good faith by the Administrative Agent in the
Register pursuant to subsection (b) above, and by each Lender Party in its
account or accounts pursuant to subsection (a) above, shall be prima facie
evidence of the amount of principal and interest due and payable or to become
due and payable from any Borrower to, in the case of the Register, each Lender
Party and, in the case of such account or accounts, such Lender Party, under
this Agreement, absent manifest error; provided, however, that the failure of
the Administrative Agent or such Lender Party to make an entry, or any finding
that an entry is incorrect, in the Register or such account or accounts shall
not limit or otherwise affect the obligations of the Borrowers under this
Agreement.
SECTION 2.15. Use of Proceeds. The proceeds of the Advances and
issuances of any Letter of Credit shall be available (and each Borrower agrees
that it shall use proceeds of Advances made to it and each Letter of Credit
issued at its request) solely (a) on the Closing Date (i) in the case of the
Initial Borrowing, to repay (together with the Term Advances) in full the
Existing AYE Debt and (ii) to continue the Existing L/Cs as AYE Letters of
Credit under this Agreement, (b) with respect to the proceeds of the Term
Advances (and together with proceeds of Revolving Advances made as part of the
Initial Borrowing), to repay in full the Existing AYE Debt and (c) each
subsequent Revolving Borrowing and Letter of Credit, for working capital for
AYE and, subject to the limitations herein, its Subsidiaries.
ARTICLE III
CONDITIONS TO BORROWING
SECTION 3.01. Conditions Precedent to the Initial Borrowing and the Term
Advances. No Lender shall be required or obligated on the Closing Date to make
any Advance, the Initial Issuing Bank shall not be required or obligated on
the Closing Date to continue the Existing L/Cs hereunder, and each Issuing
Bank shall not be required or obligated to make on the Closing Date L/C Credit
Extensions, in each case, until the first Business Day on which the following
conditions precedent have been satisfied (or waived, as evidenced by an
"effective date" notice to AYE from each Issuing Bank and the Administrative
Agent), as determined by
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each Lender and each such Issuing Bank (provided that if the Closing Date does
not occur on or before May 22, 2006, the Commitments of the Lender Parties
shall terminate on such date):
(a) The Administrative Agent's receipt of the following, each of which
shall be originals or facsimiles (followed promptly by originals) (unless
otherwise specified), each properly executed by a Responsible Officer of each
Borrower (if executed by such Borrower), each dated the date of the Initial
Borrowing (the "Closing Date") (or, in the case of certificates of
governmental officials, a recent date before the Closing Date) and each in
form and substance satisfactory to the Lender Parties (unless otherwise
specified) and in sufficient copies for the Borrowers and the Administrative
Agent (unless otherwise specified):
(i) five (5) executed counterparts of this Agreement;
(ii) to the extent requested, duly executed Notes of each
Borrower for the account of each Lender that has so requested
complying with the provision of Section 2.14 hereof;
(iii) certified copies of resolutions of the board of
directors of each Borrower approving the Transactions to which
such Borrower is or is to be a party and the execution, delivery
and performance of each Loan Document to which such Borrower is
or is to be a party, and of all documents evidencing other
necessary corporate action and governmental and other third
party approvals and consents, if any, with respect to the
Transactions and each Loan Document to which such Borrower is or
is to be a party;
(iv) copies of a certificate of the Secretary of State of
Maryland, certifying (A) as to a true and correct copy of the
certificate of incorporation or formation of AYE and each
amendment thereto on file in such Secretary's office and (B)
that (1) such amendments are the only amendments to such
certificate on file in such Secretary's office, (2) AYE has paid
all franchise taxes to the date of such certificate and (3) AYE
is duly formed and in good standing or presently subsisting
under the laws of the State of Maryland;
(v) copies of a certificate of the Secretary of State of
Delaware, certifying (A) as to a true and correct copy of the
certificate of formation of AESC and each amendment thereto on
file in such Secretary's office and (B) that (1) such amendments
are the only amendments to such certificate on file in such
Secretary's office, (2) AESC has paid all franchise taxes to the
date of such certificate and (3) AESC is duly formed and in good
standing or presently subsisting under the laws of the State of
Delaware;
(vi) copies of a certificate of the Secretary of State of
each jurisdiction (other than the jurisdiction of its formation)
set forth in Schedule 3.01(a) which shall be each jurisdiction
where any Borrower conducts a material portion of its business
other than with respect to AYE, the Commonwealth of Pennsylvania
stating that such Borrower is duly qualified to do business and
in good standing as a foreign corporation in such State and has
filed all annual reports required to be filed to the date of
such certificate, as applicable;
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(vii) certificates signed on behalf of each Borrower by
its secretary or any assistant secretary (the statements made in
which certificate shall be true on and as of the Closing Date),
certifying (A) as to a true and correct copy of the Constituent
Documents of such Borrower as of the Closing Date and each
amendment to its Constituent Documents, if any, from the date on
which the resolutions referred to in Section 3.01(a)(iii) were
adopted to the Closing Date; and (B) the names and true
signatures of the officers of such Borrower authorized to sign
each Loan Document to which it is or is to be a party and the
other documents to be delivered hereunder and thereunder;
(viii) [Intentionally Omitted];
(ix) legal opinions of appropriate counsel for the
Borrowers, as to such matters as any Lender may reasonably
request;
(x) a legal opinion of Shearman & Sterling LLP, counsel to
the Administrative Agent, as to such matters as the
Administrative Agent may reasonably request;
(xi) [Intentionally Omitted];
(xii) [Intentionally Omitted];
(xiii) certificates signed by a Responsible Officer of
each Borrower to the effect that (A) the representations and
warranties contained in Article IV by such Borrower are true and
correct on and as of the Closing Date as though made on and as
of such date both immediately before and immediately after
giving effect to the Initial Borrowing and the Term Borrowing;
and (B) no Default has occurred and is continuing or would
result from the Initial Borrowing or the consummation of that
portion of the Transactions being effected on the Closing Date
(the "Closing Date Transactions"); and
(b) All Governmental Approvals and third party consents and approvals
necessary in connection with the Transactions shall have been obtained and be
in full force and effect; and the Administrative Agent shall have received
evidence satisfactory to it that the foregoing have been accomplished.
(c) Except for Disclosed Matters as of the date hereof, since December
31, 2005, there shall not have occurred any Material Adverse Change.
(d) All required stamp duties and other costs and charges in connection
with the execution, delivery, priority or admissibility in evidence of the
Loan Documents required to be paid on or prior to the Closing Date shall have
been paid in full or an appropriate exemption therefrom shall have been
obtained.
(e) All Taxes (i) due and payable on or prior to the Closing Date in
connection with the execution, delivery or admissibility in evidence of the
Loan Documents or to ensure the legality, validity, enforceability or
admissibility in evidence of the Loan Documents and (ii) due and payable on or
prior to the Closing Date by the Borrowers in connection with the
64
consummation of the transactions contemplated by, and the performance of, the
Loan Documents shall, in the case of clauses (i) and (ii) of this Section
3.01(e), have been duly paid in full.
(f) AYE shall have paid all accrued fees of the Administrative Agent,
the Lender Parties and the Arranger Parties and all accrued expenses of the
Administrative Agent to the extent invoiced at least three Business Days prior
to the Closing Date.
SECTION 3.02. Conditions Precedent to Each Borrowing and L/C Credit
Extension. The obligation of each Lender to make an Advance (other than a L/C
Advance made by an Issuing Bank or a Revolving Lender pursuant to Section
2.03(a)) on the occasion of each Borrowing (including the Initial Borrowing)
to any Borrower, and the obligation of the Initial Issuing Bank to issue,
amend to increase the principal amount thereof or extend any Letter of Credit
(including the continuance of the Existing L/Cs as AYE Letters of Credit),
other than an extension pursuant to an Auto-Extension Letter of Credit in
accordance with the original terms thereof, shall be subject to the further
conditions precedent that on the date of such Borrowing or L/C Credit
Extension, the following statements shall be true (and each of (a) the giving
of the applicable Notice of Borrowing and (b) the acceptance by such Borrower
of the proceeds of such Borrowing or Letter of Credit shall constitute a
representation and warranty by such Borrower that both on the date of such
notice and on the date of such Borrowing or issuance such statements are
true):
(i) the representations and warranties of each Borrower
contained in Article IV (except, in the case of a Borrowing
other than the Initial Borrowing or the Term Borrowing, clause
(e) and the final sentence in clause (f) of Section 4.01) are
true and correct on and as of such date, before and after giving
effect to such Borrowing or L/C Credit Extension and to the
application of the proceeds therefrom, as though made on and as
of such date (other than as to any such representations or
warranties that, by their terms, refer to a specific date other
than the date of such Borrowing or L/C Credit Extension, in
which case they shall be true and correct as of such specific
date);
(ii) no Default has occurred and is continuing, or would
result from such Borrowing or L/C Credit Extension or from the
application of the proceeds therefrom; and
(iii) in the case of any Advance or issuance of any Letter
of Credit, in each case, made after the Closing Date, the
Closing Date has occurred.
SECTION 3.03. Determinations Under Sections 3.01 and 3.02. For purposes
of determining compliance with the conditions specified in Sections 3.01 and
3.02, each Lender Party shall be deemed to have consented to, approved or
accepted or to be satisfied with each document or other matter required
thereunder to be consented to or approved by or acceptable or satisfactory to
the Lender Parties unless an officer of the Administrative Agent responsible
for the transactions contemplated by the Loan Documents shall have received
notice from such Lender Party prior to the date of the Borrowing or issuance
of any Letter of Credit (as applicable) specifying its objection thereto and,
in the case of a Borrowing, such Lender Party shall not have made available to
the Administrative Agent such Lender Party's ratable portion of such
Borrowing.
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ARTICLE IV
REPRESENTATIONS AND WARRANTIES
SECTION 4.01. Representations and Warranties of the Borrowers. AYE and,
with respect to Sections 4.01(a) through (d) only, AESC represents and
warrants to each Lender Party and the Administrative Agent as of the date
hereof, as of the Closing Date and as of the date of any Revolving Borrowing,
Term Borrowing or issuance of an L/C Credit Extension, as follows:
(a) Each of it and its Subsidiaries (i) is a limited liability company
or corporation duly organized, validly existing and in good standing under the
laws of the jurisdiction of its formation and (ii) has all requisite corporate
or limited liability company (as applicable) power and authority (including
all governmental licenses, permits and other approvals) to carry on its
business as now conducted, except, in the case of clause (ii) only, where the
failure to so qualify or be so licensed, or to have such power and authority,
could not reasonably be expected to have a Material Adverse Effect.
(b) The execution, delivery and performance by it of each Loan Document
to which it is or is to be a party, and the consummation of the Transactions,
are within its corporate or limited liability company powers, have been duly
authorized by all necessary corporate or limited liability company action, and
do not and will not (i) contravene its Constituent Documents, (ii) violate any
law, rule, regulation (including Regulation X of the Board of Governors of the
Federal Reserve System), order, writ, judgment, injunction, decree,
determination or award, (iii) conflict with or result in the breach of, or
constitute a default or require any payment to be made under, any material
contract, loan agreement, indenture, mortgage, deed of trust, lease or other
instrument binding on or affecting it or any of its properties or (iv) result
in or require the creation or imposition of any Lien upon or with respect to
any of its Assets, except where, in the case of clauses (i) through (iv), the
violation of any such Constituent Documents, law, rule, regulation, order,
writ, judgment, injunction, decree, determination or award, breach of any such
contract, loan agreement, indenture, mortgage, deed of trust, lease or other
instrument, or creation or imposition of such Lien, could not be reasonably
expected to have a Material Adverse Effect.
(c) No authorization or approval or other action by, and no notice to or
filing with, any Governmental Authority or any other third party is required
for its due execution, delivery, recordation, filing or performance of any
Loan Document to which it is or is to be a party, or for the consummation of
the Transactions, except for (i) authorizations, approvals, actions, notices
and filings (the "Governmental Approvals") which have been duly obtained,
taken, given or made, are in full force and effect, are held in its name, and
are free from any conditions or requirements that have not been satisfied, and
are required to be satisfied, on or prior to the dates as of which this
representation and warranty is made or reaffirmed and (ii) as disclosed on
Schedule 4.01(c).
(d) This Agreement has been, and each other Loan Document to which it is
or is to be a party when delivered hereunder will have been, duly executed and
delivered by it. This Agreement is, and each other Loan Document to which it
is a party when delivered hereunder will be, its legal, valid and binding
obligation, enforceable against it in accordance with its terms,
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except to the extent limited by any applicable bankruptcy, insolvency,
reorganization, moratorium or similar laws affecting the enforcement of
creditors' rights generally and by general principles of equity.
(e) (i) There is no action, suit, investigation, litigation or
proceeding, including any Environmental Action, which has commenced against it
or any of its Subsidiaries or any of their respective properties to the
knowledge of AYE or to its knowledge, pending (but not yet commenced) against
or threatened against, it or any of its Subsidiaries or any of their
respective properties before any Governmental Authority that (A) except for
Disclosed Matters, if adversely determined, could reasonably be expected to
have a Material Adverse Effect (other than matters described on Schedule
4.01(e) (the "Disclosed Litigation") or (B) affects or could reasonably be
expected to affect the legality, validity or enforceability of any Loan
Document to which it is a party or the consummation of the Transactions.
(ii) Except for Disclosed Matters as of the Closing Date, since December
31, 2005, no Material Adverse Change has occurred.
(f) Each of the financial statements of AYE delivered to the
Administrative Agent pursuant to Sections 5.03(b) and 5.03(c) is true,
complete and correct in all material respects as of the date of such
statement, has been prepared in accordance with GAAP (subject, in the case of
interim financial statements, to normal year-end audit adjustments and the
absence of footnotes), and fairly presents in all material respects the
financial condition and results of operations of the AYE and its Subsidiaries
as of the date thereof. Except (i) for Disclosed Matters or (ii) as set forth
in Schedule 4.01(f), since the date of the most recent financial statements
delivered by AYE under this Agreement, no event, condition, occurrence or
circumstance has existed or has occurred and is continuing which could
reasonably be expected to have a Material Adverse Effect.
(g) Neither the Information Memorandum, taken as a whole, nor any other
information, exhibit or report furnished by AYE and its Subsidiaries to the
Administrative Agent, any Arranger Party or any other Lender Party in
connection with the negotiation and syndication of the Loan Documents, the
consummation of the Transactions or pursuant to the terms of the Loan
Documents, when taken together with the information contained in AYE's most
recent annual report on Form 10-K (the "Form 10-K") and in AYE's reports filed
with the SEC under the Securities Exchange Act of 1934 subsequent to the
filing of the Form 10-K, taken as a whole, contains (as of the date on which
such information is or was provided to the Administrative Agent, any Arranger
Party or any Lender Party, as modified or otherwise supplemented by
information so provided) any untrue statement of a material fact or omits to
state a material fact necessary to make the statements made therein, in light
of the circumstances under which they were, are or will be made, not
misleading; provided that to the extent any such information, exhibit or
report was based upon or constitutes a forecast or projection, AYE represents
only that such information was prepared in good faith on the basis of the
assumptions stated therein, which assumptions were believed by AYE to be
reasonable at the time (it being understood that such forecasts or projections
are subject to significant uncertainties and contingencies, many of which are
beyond AYE's control, and that AYE makes no representation as to the
attainability of such forecasts or projections or as to whether such forecasts
or projections will be achieved or materialize).
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(h) Neither it nor any of its Subsidiaries is an "investment company",
as such term is defined in the 1940 Act.
(i) AYE is not engaged principally, or as one of its important
activities, in the business of extending credit for the purpose of purchasing
or carrying Margin Stock, and no proceeds of any Advance made to it or
drawings under any Letter of Credit will be used to purchase or carry any
Margin Stock or to extend credit to others for the purpose of purchasing or
carrying any Margin Stock for any purpose that violates, or is inconsistent
with, the provisions of Regulation T, U or X of the Board of Governors of the
Federal Reserve System, as in effect from time to time. If requested by any
Lender Party or the Administrative Agent, AYE will furnish to the
Administrative Agent and such Lender Party a statement to the foregoing effect
in conformity with the requirements of FR Form G-3 or FR Form U 1, as
applicable, referred to in Regulation U of the Board of Governors of the
Federal Reserve System, as in effect from time to time.
(j) No ERISA Event has occurred with respect to any Plan that has
resulted in a material liability which could be reasonably likely to have a
Material Adverse Effect. Schedule B (Actuarial Information) to the most recent
annual report (Form 5500 Series) for each Plan, filed with the Internal
Revenue Service is complete and accurate, and since the date of such Schedule
B there has been no material adverse change which could reasonably be expected
to have a Material Adverse Effect on such funding status. Except as could not
reasonably be expected to have a Material Adverse Effect, neither it nor any
ERISA Affiliate (i) has incurred any Withdrawal Liability to any Multiemployer
Plan, or (ii) has been notified by the sponsor of a Multiemployer Plan that
such Multiemployer Plan is in reorganization or has been terminated, within
the meaning of Title IV of ERISA.
(k) (i) Except as disclosed on Schedule 4.01(k) or in AYE's filings with
the SEC or as could not reasonably be expected to have a Material Adverse
Effect, (A) its operations and properties, and the operations and properties
of each of its Subsidiaries, comply in all respects with all applicable
Environmental Laws and Environmental Permits, (B) all past non-compliance with
such Environmental Laws and Environmental Permits has been resolved without
material ongoing obligations or costs and (C) no circumstances exist that
could reasonably be expected to (I) form the basis of an Environmental Action
against it or any of its Subsidiaries or any of their properties or (II) cause
any such property to be subject to any restrictions on ownership, occupancy,
use or transferability under any Environmental Law.
(ii) Except as disclosed on Schedule 4.01(k) or in AYE's filings with
the SEC or as could not reasonably be expected to have a Material Adverse
Effect, (A) none of the properties currently or formerly owned or operated by
it or any of its Subsidiaries is listed or proposed for listing on the NPL or
on the CERCLIS or any analogous foreign, state or local list, (B) to its
knowledge, there are no and never have been any unlawful underground or
aboveground storage tanks or any surface impoundments, septic tanks, pits,
sumps or lagoons in which Hazardous Materials are being or have been treated,
stored or disposed on any property currently owned or operated by it or any of
its Subsidiaries or on any property formerly owned or operated by it or any of
its Subsidiaries, and (C) Hazardous Materials have not been released,
discharged or disposed of on any property currently or formerly owned or
operated by it or any of its Subsidiaries.
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(iii) Except as disclosed on Schedule 4.01(k) or in AYE's filings with the SEC
or as could not reasonably be expected to have a Material Adverse Effect, (A)
neither it nor any of its Subsidiaries is undertaking, and has not completed,
either individually or together with other potentially responsible parties,
any investigation or assessment or remedial or response action relating to any
actual or threatened release, discharge or disposal of Hazardous Materials at
any site, location or operation, either voluntarily or pursuant to the order
of any governmental or regulatory authority or the requirements of any
Environmental Law and (B) all Hazardous Materials generated, used, treated,
handled or stored at, or transported to or from, any property currently or
formerly owned or operated by it or any of its Subsidiaries have been used,
sold or disposed of in a manner not reasonably expected to result in material
liability to it or any of its Subsidiaries.
(l) (i) Neither it nor any of its Subsidiaries is party to any tax
sharing agreement other than the Tax Allocation Agreement. Insofar as then
required thereunder, all amounts due and payable by it or any of its
Subsidiaries under the Tax Allocation Agreement have been paid, and all
amounts due and payable to it or any of its Subsidiaries under any tax sharing
agreement have been received (including amounts by way of compensation for the
use of tax benefits), except as could not reasonably be expected to have a
Material Adverse Effect.
(ii) It has, and each of its Subsidiaries has, filed, has caused to be
filed or been included in all tax returns (federal, state, local and foreign)
required to be filed and has paid all taxes shown thereon to be due, together
with applicable interest and penalties, except (A) to the extent that the
aggregate amount of any unpaid taxes due, together with applicable interest
and penalties, does not exceed $25,000,000 or (B) to the extent such unpaid
taxes are subject to Contest.
(m) No Default has occurred and is continuing.
(n) Set forth on Schedule 4.01(n) is a complete and accurate list as of
the Closing Date (except, solely with respect to the amount thereof, as
otherwise indicated therein) of each Qualifying Obligation constituting Debt
for Borrowed Money owed by AYE or any of its Subsidiaries (other than any
Regulated Subsidiary or any AESC Company), showing the amount, obligor or
issuer, creditor and maturity thereof.
(o) Set forth on Schedule 4.01(o) is a complete and accurate list as of
the Closing Date of all Liens (other than Permitted Liens and Liens specified
in clause (iii) below) on the property or assets of AYE, showing the
lienholder thereof and the property of or assets of the AYE subject thereto.
As of the Closing Date, the property of AYE is subject to no Liens other than
(i) Liens set forth on Schedule 4.01(o), (ii) Permitted Liens and (iii) Liens
existing as of the Closing Date but not set forth on Schedule 4.01(o) which
secure, individually, an amount of Obligations not to exceed $5,000,000 or
which secure, in the aggregate, an amount of Obligations not to exceed
$25,000,000.
(p) [Intentionally Omitted]
(q) Except as could not reasonably be expected to have a Material
Adverse Effect, AYE and each of its Subsidiaries has all authorizations and
approvals from the FERC or
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other Governmental Authority required to provide the services and goods
(including electric capacity, energy and ancillary services) it sells,
including all necessary rate schedules on file and effective with the FERC for
AYE and its Subsidiaries to sell electricity at wholesale and authorizations
necessary for AYE and its Subsidiaries to engage in existing affiliate
transactions.
(r) As of the Closing Date, AYE does not directly or indirectly own or
operate any "qualifying facilities," as defined in the Public Utility
Regulatory Policies Act of 1978 and the regulations of the Federal Energy
Regulatory Commission issued thereunder.
(s) As of the Closing Date, AYE does not directly or indirectly hold any
license issued by the Nuclear Regulatory Commission, or have any direct or
indirect interest in, or directly or indirectly possess, use, or engage in any
activities or transactions with respect to, any "byproduct material," "source
material," or "special nuclear material," as those terms are defined in the
Atomic Energy Act of 1954 and the regulations of the Nuclear Regulatory
Commission issued thereunder.
ARTICLE V
COVENANTS OF THE BORROWER
SECTION 5.01. Affirmative Covenants of the Borrowers. AYE and, with
respect to Section 5.01(m) only, AESC covenants and agrees that on and after
the date hereof and until the Notes, together with all accrued interest
thereon, fees and all other Senior Debt Obligations (other than contingent
indemnification obligations not yet due and payable) are paid in full and all
Commitments and each Letter of Credit shall have terminated, it will:
(a) Compliance with Laws. Comply, and cause each of its Subsidiaries to
comply with all Applicable Laws, except where the failure to do so could not
reasonably be expected to have a Material Adverse Effect.
(b) Compliance with Environmental Laws. Except where the failure to do
so could not reasonably be expected to have a Material Adverse Effect, (i)
comply, and cause each of its Subsidiaries and all lessees and other Persons
operating or occupying its properties to comply with all applicable
Environmental Laws and Environmental Permits, (ii) obtain and renew, and cause
each of its Subsidiaries to obtain and renew, all Environmental Permits
necessary for its operations and properties and (iii) conduct, and cause each
of its Subsidiaries to conduct, any required investigation, study, sampling
and testing, and undertake any cleanup, removal, remedial or other action
necessary to remove and clean up all Hazardous Materials from any of its
properties required under any Environmental Law.
(c) Governmental Approvals. Obtain and maintain, and cause each of its
Subsidiaries to obtain and maintain, all Governmental Approvals (including the
Material Governmental Approvals) that are required of it for the validity or
enforceability of the Loan Documents, the ongoing operations of their
respective businesses and to issue, declare or pay dividends or distributions,
except where the failure to do so could not reasonably be expected to have a
Material Adverse Effect.
(d) Payment of Taxes, Etc. Except where the failure to do so could not
reasonably be expected to have a Material Adverse Effect, pay and discharge,
and cause each of
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its Regulated Subsidiaries to pay and discharge, before the same shall become
delinquent, (i) all taxes, assessments and governmental charges or levies
imposed upon it or upon its property and (ii) all lawful claims that, if
unpaid, will by law become a Lien upon its property not permitted by Section
5.02; provided that neither it nor any of its Regulated Subsidiaries shall be
required to pay or discharge any such tax, assessment, charge or claim that is
the subject of a Contest.
(e) Insurance. Maintain, and cause each of its Regulated Subsidiaries to
maintain, insurance with responsible and reputable insurance companies or
associations in such amounts and covering such risks as is usually carried by
companies engaged in similar businesses and owning similar properties in the
same general areas in which it or such Subsidiary operates.
(f) Preservation of Corporate Existence, Etc. Except as could not
reasonably be expected to have a Material Adverse Effect, preserve and
maintain, and cause each of its Subsidiaries to preserve and maintain, its
existence, legal structure, rights (charter or statutory), permits, licenses,
approvals, franchises, and privileges in the jurisdiction of its formation and
in each other jurisdiction in which the conduct of its business requires it to
so qualify; provided, however, that it and its Subsidiaries may consummate any
merger or consolidation permitted under Section 5.02(d).
(g) Visitation Rights. At any reasonable time during normal business
hours and from time to time as may be reasonably desired by the Administrative
Agent or any of the Lender Parties (provided that unless a Default shall have
occurred and be continuing, such visits should be limited to twice per year),
at AYE's reasonable cost and expense, permit the Administrative Agent or any
of the Lender Parties, or any agents or representatives thereof, to examine
and make copies of and abstracts from its records and books of account of, and
visit the properties of, it and its Subsidiaries, and to discuss the affairs,
finances and accounts of it and any of its Subsidiaries with any of their
officers or directors and with their independent certified public accountants;
provided that in the case of any discussion or meeting with the independent
public accountants, only if AYE has been given the opportunity to participate
in such discussion.
(h) Keeping of Books. Keep, and cause each of its Subsidiaries to keep,
proper books of record and account in accordance with GAAP in effect from time
to time.
(i) Maintenance of Properties, Etc. Except as could not reasonably be
expected to have a Material Adverse Effect and other than as mandatorily
required by Applicable Law, operate, maintain and preserve, and cause each of
its Subsidiaries to operate, maintain and preserve, all of its properties
(other than any such properties as are immaterial or non-essential to the
conduct of business by it and its Subsidiaries, taken as a whole) that are
used or useful in the conduct of its business in good working order and
condition (ordinary wear and tear excepted) in accordance with prudent
practices then being utilized in the electric utility industry and in
accordance with Applicable Laws (including Environmental Laws).
(j) Transactions with Affiliates. Other than as may be required by the
Federal Power Act, as amended, or any rule or regulation issued by FERC,
conduct, and cause each of its Subsidiaries to conduct, (i) all transactions
with any of AYE's Affiliates on terms that are fair and reasonable and no less
favorable to AYE or such Subsidiary than AYE would obtain in a
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comparable arm's-length transaction with a Person not an Affiliate of AYE and
(ii) all transactions with a Person other than an Affiliate of AYE on terms
that are without regard to any benefit or detriment to any Affiliate of AYE
(other than any of AYE's Subsidiaries); provided that this Section 5.01(j)
shall not be deemed to permit any transaction otherwise prohibited by the
terms of this Agreement. Without prejudice to the foregoing, the following
transactions shall be deemed to be in compliance with the first sentence of
this clause (j): (A) any transaction executed in accordance with the
requirements of Applicable Law, (B) any agreements made by AYE or any of its
Subsidiaries with a utility to provide provider of last resort requirements,
as such agreements are amended from time to time, so long as such provider of
last resort agreements are with an Affiliate of AYE and approved by all
applicable Governmental Authorities, (C) any transaction authorized under a
tariff or rate schedule which has been approved by the FERC or performed in
accordance with FERC orders, (D) any agreement for the transfer, sale or
servicing of any Assets in connection with a Stranded Cost Securitization or
an Environmental Control Property Securitization, any loan or transfer of the
proceeds of any such Permitted Securitization, or any agreement for the
transfer, sale or servicing of any Assets in connection with any other
Permitted Securitization on reasonable and customary terms between a Regulated
Subsidiary and its Securitization SPV as contemplated under Sections
5.02(e)(viii)(A) and (B), (E) any Asset sales, leases, transfers, swaps,
exchanges or other dispositions (including in respect of full or partial
ownership percentages of transmission lines (including the AGC Transmission
Line), generating facilities, generating equipment and related contract rights
in power purchase agreements, leases, licenses, permits and other Assets) as
contemplated under Section 5.02(e)(viii)(C) and Section 5.02(e)(vi) in respect
of up to $10,000,000 in the aggregate of such Assets, (F) the payment by AYE
or any Subsidiary of AYE of salaries, benefits and other compensation to
directors, officers and employees of AYE or such Subsidiary of AYE, (G) any
sales, leases, transfers, swaps, assignments, exchanges or other distributions
of Assets related to the Buffalo Reserve Project (whether in one transaction
or a series of related transactions) to a wholly owned direct or indirect
Subsidiary of AYE, and (H) any issuances, sales, leases, transfers,
distributions, assignments or other dispositions of any Equity Interests in
any Buffalo Creek SPV (in each case, whether in one transaction of a series of
related transactions, and whether by way of merger, consolidation or
otherwise) to a wholly owned direct or indirect Subsidiary of AYE. For the
avoidance of doubt, (I) any contracts or arrangements listed on Schedule
5.01(j) to which AYE or any Subsidiary of AYE is a party (and any amendments
thereto, renewals or replacements thereof on substantially the same terms as
determined in good faith by a Responsible Officer of such Borrower or any
Subsidiary of such Borrower that is a party thereto) and (II) the Loan
Documents shall each be deemed to comply with this Section 5.01(j) except to
the extent that any Governmental Authority determines that any such contract
is not in conformance with Applicable Law and such non-conforming contract is
not on terms described in the first sentence of this Section 5.01(j).
(k) Preparation of Environmental Reports. If the Administrative Agent shall
reasonably believe that a material environmental event has occurred on any
parcel of real property owned or leased by it or any of its Subsidiaries
(other than the AESC Companies) after the date hereof, provide to the
Administrative Agent within 90 days after receipt of a written request from
the Administrative Agent in which the Administrative Agent describes in
reasonable detail the basis for such belief, at AYE's expense, a Phase I
environmental site assessment report for the properties described in such
request prepared by an environmental consulting firm reasonably acceptable to
the Administrative Agent, indicating the presence or
72
absence of Hazardous Materials and the estimated cost of any legally required
compliance, removal or remedial action in connection with any Hazardous
Materials on such properties. Without limiting the generality of the
foregoing, if the Administrative Agent determines at any time that a material
risk exists that any such report will not be provided within the time referred
to above, the Administrative Agent may, at the time following the forty-fifth
day after the request of the Administrative Agent, retain an environmental
consulting firm to prepare such report at the expense of AYE, and AYE hereby
grants and agrees to cause any Subsidiary that owns any property described in
such request to grant at the time of such request to the Administrative Agent,
such firm and any agents or representatives thereof an irrevocable
non-exclusive license, subject to the rights of tenants, to enter onto their
respective properties to undertake such an assessment.
(l) Maintenance of Ownership of Subsidiaries. Except as not prohibited
by or as permitted under Section 5.01(f), Section 5.02(d) or 5.02(e), maintain
ownership and control of all Equity Interests that it holds in all of its
direct Subsidiaries (other than the Subsidiaries of any Regulated Subsidiary),
free and clear of all Liens except as not prohibited by or as permitted by the
Loan Documents.
(m) Use of Proceeds. (i) Use the proceeds (A) in the case of AYE, of the
Initial Borrowing and the Term Advances to repay in full the Existing AYE Debt
and continue the Existing L/Cs as AYE Letters of Credit under this Agreement
and (B) in the case of each Borrower, of each subsequent Revolving Borrowing,
for working capital for it and its Subsidiaries, and
(ii) In the case of each Borrower, use Letters of Credit issued at any
time after the Closing Date to support the working capital needs of it and its
Subsidiaries.
SECTION 5.02. Negative Covenants of AYE. AYE covenants and agrees that
on and after the date hereof and until the Notes, together with all accrued
interest thereon, fees and all other Senior Debt Obligations (other than
contingent indemnification obligations not yet due and payable) are paid in
full and all Commitments and each Letter of Credit shall have terminated, AYE
will not, at any time:
(a) Liens, Etc. Create, incur, assume or suffer to exist any Lien on or
with respect to any of AYE's properties of any character (including accounts)
whether now owned or hereafter acquired, or sign or file or suffer to exist
under the Uniform Commercial Code of any jurisdiction, a financing statement
that names AYE as debtor, or sign or suffer to exist any security agreement
authorizing any secured party thereunder to file such financing statement, or
assign any accounts or other right to receive income, except:
(i) any Liens created pursuant to Section 2.03(e);
(ii) Permitted Liens;
(iii) Liens existing on the date hereof and described on
Schedule 4.01(o);
(iv) purchase money Liens upon or in real property,
physical assets or equipment acquired or held by AYE in the
ordinary course of business to secure the
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purchase price of such real property, physical assets or
equipment or to secure Debt permitted to be incurred pursuant to
Section 5.02(b)(vi) incurred solely for the purpose of financing
the acquisition, construction or improvement (including any
Capital Expenditure) of any such real property, physical assets
or equipment to be subject to such Liens, or Liens existing on
any such real property, physical assets or equipment at the time
of acquisition (other than any such Liens created in
contemplation of such acquisition that do not secure the
purchase price), or extensions, renewals or replacements of any
of the foregoing for the same or a lesser amount; provided,
however, that (A) such Lien is incurred and the Debt secured
thereby is created within 90 days after the acquisition,
completion of construction or completion of improvement thereof
(as applicable), and (B) no such Lien shall extend to or cover
any property or equipment other than the real property, physical
assets or equipment being acquired, constructed or improved; and
provided further that the aggregate principal amount of the Debt
secured by Liens permitted by this clause (iv) shall not exceed
the amount permitted under Section 5.02(b)(vi) at any time
outstanding;
(v) Liens arising in connection with Capitalized Leases
permitted under Section 5.02(b)(vii); provided that no such Lien
shall extend to or cover any Assets other than the Assets
subject to such Capitalized Leases;
(vi) Liens on property of a Person existing at the time
such Person is merged into or consolidated with AYE; provided
that such Liens were not created in contemplation of such merger
or consolidation and do not extend to any Assets other than
those of the Person merged into or consolidated with AYE;
(vii) other Liens affecting property with an aggregate
fair value not to exceed, together with the aggregate principal
amount of all Debt secured by Liens permitted under clauses (iv)
and (v) of this Section 5.02(a), $7,500,000;
(viii) the replacement, extension or renewal of any Lien
permitted by clauses (iii) through (vii) above upon or in the
same property theretofore subject thereto and, if such Lien
secures Debt, upon the incurrence of any Permitted Refinancing
Debt in respect of such Debt secured to the extent such
Permitted Refinancing Debt is incurred in accordance with
Section 5.02(b)(xvi);
(ix) Liens granted by AYE in favor of a commercial trading
counterparty, a futures contract broker or other contract
counterparty on accounts receivable arising under, commodities
covered by, other obligations owed to, and other rights of, AYE
under any contract (other than for Debt) entered into in the
ordinary course of business and to the extent not prohibited
under Section 5.02(l) in connection with commercial and trading
activities and ancillary services (including any netting
agreement) to secure AYE's obligations or obligations of any
Subsidiary of AYE under such contract; provided that such Liens
are granted in the ordinary course of business and when granted,
do not secure obligations which are past due;
(x) Liens on (A) cash, Cash Equivalents or accounts
receivables deposited in margin accounts with or on behalf of
futures contract brokers or paid over to other
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contract counterparties (in the case of cash or Cash
Equivalents), (B) cash, Cash Equivalents or accounts receivables
deposited (in the case of cash or Cash Equivalents) or pledged
as collateral to a contract counterparty to secure obligations
with respect to (1) contracts (other than for Debt) for
commercial and trading activities in the ordinary course of
business for the purchase, transmission, distribution, sale,
storage, lease or hedge of any energy related commodity or (2)
Hedge Agreements representing commodity price contracts,
transmission agreements or derivatives or interest rate
derivatives to the extent that AYE is permitted to enter into
any such Hedge Agreement pursuant to Section 5.02(b)(v), or (C)
cash or Cash Equivalents deposited to secure reimbursement
obligations with respect to letters of credit that encumber
documents and other property relating to such letters of credit
and the proceeds and products thereof; provided that the amount
of Obligation secured by Liens permitted by this Section
5.02(a)(x) shall not exceed $50,000,000 at any time outstanding;
provided further that the face amount of accounts receivables
pledged to a contract counterparty to secure obligations set
forth in clause (B)(1) or (2) above shall not exceed $15,000,000
at any time outstanding;
(xi) Liens granted in respect of Assets that are the
subject of sales, leases, transfers, swaps, exchanges or other
dispositions (including ownership interests in generating
facilities, generating equipment and related contract rights and
other intangible property, and Intangible Transition Property,
Environmental Control Property or accounts receivable) permitted
under Section 5.02(e)(viii);
(xii) Liens granted on cash or Cash Equivalents to defease
Debt that could be repaid or prepaid without violating Sections
5.02(b) or 5.02(k); and
(xiii) Liens granted on cash or Cash Equivalents
constituting proceeds from any sale or disposition of Assets
that are not prohibited by Section 5.02(e) deposited in escrow
accounts to secure Debt permitted to be incurred under Section
5.02(b)(xi) in respect of such sale or disposition.
(b) Debt. Create, incur, assume or suffer to exist, or permit any of its
Subsidiaries (other than the Regulated Subsidiaries and the AESC Companies) to
create, incur, assume or suffer to exist, any Debt other than pursuant to the
Loan Documents, except:
(i) Debt under the Loan Documents;
(ii) until the Closing Date, Debt in respect of the
Existing Credit Agreement;
(iii) Surviving Debt;
(iv) unsecured intercompany Debt owed to AYE or any
Subsidiary to the extent permitted under Section 5.02(f);
(v) Debt in respect of Hedge Agreements (including
Commodity Hedge Agreements) entered into in the ordinary course
of business and consistent with prudent business practice to
hedge or mitigate (A) risks to which AYE or any Subsidiary of
AYE is exposed in the conduct of its business or the management
of its liabilities as a result of
75
fluctuations in the prices of transmission, capacity or energy
(or of any fuel required for the generation thereof), Emissions
Credits or energy attributes or (B) risks in respect of interest
rate fluctuations; provided that in each case such Hedge
Agreement shall not have been entered into for speculative
purposes;
(vi) Debt incurred to finance all or any part of the
acquisition, construction or improvement of any real property,
physical assets or equipment (including any Capital
Expenditures) of AYE or any Subsidiary of AYE (other than the
Regulated Subsidiaries and the AESC Companies); provided that
(A) such Debt is incurred prior to, or within 90 days after such
acquisition or the completion of construction or completion of
improvement or such Capital Expenditure and (B) such Debt has a
scheduled maturity date that is at least six calendar months
after the Final Maturity Date and does not require any scheduled
amortization or mandatory prepayments thereof prior to such
date; provided further that the aggregate principal amount of
Debt permitted under this Section 5.02(b)(vi) and Section
5.02(b)(vii) shall not exceed $7,500,000 at any time
outstanding;
(vii) Capitalized Leases in an aggregate principal amount,
together with the aggregate principal amount of all Debt
permitted under Section 5.02(b)(vi), not in excess of $7,500,000
at any time outstanding;
(viii) Debt of any Person that either (x) is merged into
or consolidated with AYE or any Subsidiary of AYE, or (y)
becomes a Subsidiary of AYE after the date hereof in either case
in accordance with the terms of Section 5.02(f), provided that
with respect to clause (y) (A) such Debt is existing at the time
such Person becomes a Subsidiary of AYE (other than Debt
incurred solely in contemplation of such Person becoming a
Subsidiary of AYE), (B) immediately after giving effect to the
investment in such Subsidiary, no Default shall have occurred
and be continuing, and (C) such Debt is non-recourse to AYE or
any other Subsidiary (other than with respect to such Person and
its Subsidiaries to the extent such Debt was with recourse to
such Person and/or to its Subsidiaries at the time of such
investment);
(ix) Debt arising from the honoring by a bank or financial
institution of a check, draft or similar instrument
inadvertently (except in the case of daylight overdrafts) drawn
against insufficient funds in the ordinary course of business,
so long as such Debt is covered within five Business Days;
(x) Debt in respect of workers' compensation claims,
self-insurance obligations, bankers' acceptance and performance
and surety bonds provided by AYE or any Subsidiary of AYE in the
ordinary course of business;
(xi) Debt that may be deemed to arise as a result of
agreements of AYE or any of Subsidiary of AYE providing for
indemnification, adjustment of purchase price or any similar
obligations, in each case, incurred in connection with the sale
or disposition of any business, assets or Equity Interests in
any Subsidiary of AYE consummated not in contravention of
Section 5.02(e) in an amount not to exceed with respect to any
such sale or disposition the amount of gross proceeds received
by AYE or such Subsidiary in connection with such sale or
disposition;
76
(xii) Debt of AYE represented by letters of credit, surety
bonds, Contingent Obligations and performance bonds supporting
obligations of AYE or its Subsidiaries so long as, after giving
effect to such letters of credit, surety bonds, Contingent
Obligations and performance bonds (and the Investment
represented thereby) AYE would be in compliance with Section
5.02(f)(v);
(xiii) reimbursement obligations owed to Affiliates for
amounts paid on behalf of any Borrower or any of Subsidiary of
any Borrower in accordance with applicable requirements under
Applicable Law with respect to the provision of goods or
services to AYE or such Subsidiary;
(xiv) other unsecured Debt of AYE or any Subsidiary of AYE
not to exceed $20,000,000 at any time outstanding; provided such
Debt has a scheduled maturity date that is at least six calendar
months later than the Final Maturity Date and does not require
any scheduled amortization or mandatory prepayments thereof
prior to such date;
(xv) unsecured Debt in respect of obligations of AYE or
any Subsidiary of AYE to pay the deferred purchase price of
goods or services or progress payments in connection with such
goods and services; provided that with respect to any material
invoice, such obligations (A) are incurred in connection with
open accounts extended by suppliers on customary trade terms
(which require that all such payments be made within 90 days of
the incurrence of the related Debt) in the ordinary course of
business and not in connection with the borrowing of money, (B)
are not more than 90 days past due and (C) are not subject to a
Contest;
(xvi) Permitted Refinancing Debt incurred in respect of
any Debt permitted under clauses (i), (iii), (vi), (vii), (viii)
and (xiv) above or this clause (xvi);
(xvii) Debt or Contingent Obligations incurred by AYE or
its Subsidiaries in connection with loans and advances to its
employees in the ordinary course of its business as presently
conducted in an aggregate principal amount not to exceed
$2,000,000 at any time outstanding;
(xviii) secured or unsecured Debt owed to PNC Bank,
National Association from time to time in connection with the
extension of credit to AYE or its Subsidiaries for the account
of one or more employees or departments of AYE or its
Subsidiaries in respect of costs and expenses incurred by such
employees or departments in connection with the conduct of
business on behalf of AYE or its Subsidiaries in an aggregate
principal amount not to exceed $10,000,000 at any one time
outstanding;
(xix) unsecured Debt incurred by AYE, any Regulated
Subsidiary or any Buffalo Creek SPV in connection with the
Buffalo Reserve Project and/or any Joint Ventures in an
aggregate amount not to exceed $75,000,000 at any time
outstanding; provided that such Debt has a scheduled maturity
date that is at least six calendar months later than the Final
Maturity Date and does not require any scheduled amortization or
mandatory prepayments thereof prior to such date;
(xx) Services Corp Regulated Debt; and
77
(xxi) Services Corp AESC Debt in an aggregate amount not
to exceed $17,500,000 at any time outstanding.
(c) Change in Nature of Business. Other than the Buffalo Reserve
Project, (i) make, or permit any of its Subsidiaries to make, any material
change in the nature of its business as carried on at the date hereof or (ii)
engage in, or permit any of its Subsidiaries to engage in, any business other
than electric power generation, transmission and distribution and/or energy
trading and other businesses reasonably and directly related thereto, or any
other business in which AYE or any of its Subsidiaries or Affiliates is
engaged on the Closing Date.
(d) Mergers, Etc. Merge into or consolidate with any Person or permit
any Person to merge into it, or permit any of its Subsidiaries to do so,
except that:
(i) any Subsidiary of AYE may merge into or consolidate
with any other Subsidiary of AYE, provided that, (A) except as
otherwise permitted in clause (B), (C) or (D) below, in the case
of any such merger or consolidation, the Person formed by such
merger or consolidation shall be a wholly owned direct or
indirect Subsidiary of AYE, (B) any Subsidiary of AESC may merge
into or consolidate with AESC so long as AESC is the surviving
Person following such merger or consolidation, (C) any
Subsidiary of AESC may merge into or consolidate with another
Subsidiary of AESC so long as the Person formed by such merger
or consolidation is a Subsidiary of AESC and (D) AESC may merge
into or otherwise consolidate with another Person if either (x)
AESC is the surviving entity or (y) (1) the surviving entity is
organized or existing under the laws of the United States, any
state thereof or the District of Columbia, (2) the surviving
entity assumes all of AESC's Obligations under the Loan
Documents pursuant to agreements reasonably satisfactory to the
Administrative Agent and (3) the Public Debt Ratings (AESC) of
the surviving entity immediately following such merger or
consolidation shall be no worse than the Public Debt Ratings
(AESC) of AESC immediately prior to such merger or
consolidation;
(ii) in connection with any sale, transfer or other
disposition permitted under Section 5.02(e) (other than Section
5.02(e)(iv)), any Subsidiary of AYE may merge into or
consolidate with any other Person or permit any other Person to
merge into or consolidate with it;
(iii) in connection with any acquisition permitted under
Section 5.02(f), any Subsidiary may merge into AYE; and
(iv) AYE may merge into or otherwise consolidate with
another person if either (A) AYE is the surviving entity or
(B)(1) the surviving entity is organized or existing under the
laws of the United States, any state thereof or the District of
Columbia, (2) the surviving entity assumes all of AYE's
Obligations under the Loan Documents pursuant to agreements
reasonably satisfactory to the Administrative Agent and (3) the
Public Debt Ratings of the surviving entity immediately
following such merger or consolidation shall be no worse than
the Public Debt Ratings of AYE immediately prior to such merger
or consolidation;
78
provided, however, that in each case, immediately after giving effect thereto,
no event shall occur and be continuing that constitutes a Default.
(e) Sales, Etc., of Assets. Sell, lease, transfer or otherwise dispose
of, or permit any of its Subsidiaries to sell, lease, transfer or otherwise
dispose of, any Assets or grant any option or other right to purchase, lease
or to otherwise acquire any Assets other than:
(i) the sale, transfer, lease or other disposition of or
grant of any option or other right to purchase, lease or
otherwise acquire power, capacity, the right to transmit
electricity or natural gas, fuel, fuel storage and processing,
energy attributes and other products and services and Cash
Equivalents in the ordinary course of business and any sale,
lease or other disposition of or grant of any option or other
right to purchase, lease or otherwise acquire damaged, surplus,
worn-out or obsolete Assets in the ordinary course of business;
(ii) any sale, transfer, lease or other disposition of
damaged, surplus, worn-out or obsolete Assets in the ordinary
course of business;
(iii) the sale, transfer or other disposition of emission,
fuel, air quality or other environmental attributes or credits
in the ordinary course of business;
(iv) transactions permitted under Section 5.02(d);
(v) the sale, lease, transfer or other disposition of
Assets by AESC and its Subsidiaries;
(vi) sales, leases, transfers or other dispositions of, or
grant of any option or other right to purchase, lease, or
otherwise acquire, other immaterial property (other than Equity
Interests in, or Debt of any Subsidiary) in the ordinary course
of business and on reasonable terms;
(vii) sales, leases, transfers or other dispositions of,
or grant of any option or other right to purchase, lease, or
otherwise acquire, Assets or Equity Interests among AYE and its
Subsidiaries (other than any AESC Company); provided that (A) no
Debt for Borrowed Money is incurred in connection therewith and
(B) no Lien is created, granted, incurred or assumed in
connection therewith;
(viii) (A) the sale or transfer of Assets in connection
with a securitization thereof pursuant to the Pennsylvania
Electricity Generation Customer Choice and Competition Act of
1996, as amended from time to time, (such property being sold or
transferred, the "Intangible Transition Property" and such sale
or transfer, the "Stranded Cost Securitization") in an amount
not to exceed (x) $120,000,000 plus (y) the proceeds of any such
sale or Debt in connection with such Stranded Cost
Securitization applied to voluntarily prepay the Facilities (but
only if, and to the extent, AYE optionally terminates
Commitments pursuant to Section 2.05(a) concurrently with, and
in an amount equal to, such prepayment) minus (z) the aggregate
amount of all capital contributions made by AYE or any of its
Subsidiaries to Securitization SPVs with respect to Stranded
Cost Securitizations;
79
(B) (1) the sale or transfer of Assets in connection with
a securitization thereof pursuant to Section 24-2-4e of the Code
of West Virginia (such property being sold or transferred, the
"Environmental Control Property" and such sale or transfer, the
"Environmental Control Property Securitization") or (2) the sale
or transfer of other Assets in connection with any other
Permitted Securitization (other than a Stranded Cost
Securitization), in an amount with respect to clauses (1) and
(2) not to exceed (x) $700,000,000 in the aggregate plus (y) the
proceeds of any such sales or Debt in connection with such
Environmental Control Property Securitization or other Permitted
Securitization applied to voluntarily prepay the Facilities (but
only if, and to the extent, AYE optionally terminates
Commitments pursuant to Section 2.05(a) concurrently with, and
in an amount equal to, such prepayment) minus (z) the aggregate
amount of all capital contributions made by AYE or any of its
Subsidiaries to Securitization SPVs with respect to
Environmental Control Property Securitizations; and
(C) the sale, lease, transfer, swap, exchange or other
disposition of Assets, including full or partial ownership
percentages of AYE and its Subsidiaries' various generating
facilities (including AGC and Bath County) or any Assets used in
connection with or related to such generating facilities,
including generating equipment, power, contract rights, permits,
licenses and other intangibles; provided that (A) after any such
Asset sale, lease, transfer, swap, exchange or other
disposition, the Subsidiaries of AYE, taken as a whole, will
continue to hold cumulative interests in all Assets equal to the
amount they held prior to such sale, lease, transfer, swap,
exchange or other disposition and (B) as a result of all Asset
sales, leases, transfers, swaps, exchanges or other
dispositions, taken as a whole, AYE and the Regulated
Subsidiaries shall receive Assets with a fair market value in an
amount not less than the fair market value (as determined by
reference to the PA Report, as applicable) less $200,000,000, of
all Assets sold, leased, transferred, swapped, exchanged or
otherwise disposed of out of AYE and the Regulated Subsidiaries
(determined on a cumulative basis);
(ix) sales, transfers, leases or other dispositions of, or
grant of any option or other right to purchase, lease, transfer
or otherwise acquire, any of AYE's Assets, the Assets of the
Regulated Subsidiaries or the Assets of a Buffalo Creek SPV
(including any Equity Interest in the Regulated Subsidiaries or
a Buffalo Creek SPV or any contractual rights); provided that,
except with respect to (x) any lease or other disposition of
Assets of a Buffalo Creek SPV pursuant to which (i) title to
such Assets remains with AYE or a Buffalo Creek SPV which is a
direct or indirect wholly owned Subsidiary of AYE or (ii)
royalty payments are received in connection with the Buffalo
Reserve Project, (y) any sale, transfer, lease or other
disposition of Equity Interests in a Buffalo Creek SPV to AYE or
another Buffalo Creek SPV which is a direct or indirect wholly
owned Subsidiary of AYE and (z) sales, transfers, leases or
other dispositions of Assets of the Buffalo Creek Reserve not to
exceed $75,000,000 in the aggregate, (A) the consideration
received by AYE, its Regulated Subsidiaries or Buffalo Creek
SPV, as the case may be, for such Asset shall have been
determined on the basis of an arms-length negotiation with a
non-Affiliates, (B) not less than 75% of the purchase price
(excluding the amount of any Debt assumed in connection with any
such sale or other disposition by a Person other than AYE, its
Regulated Subsidiaries or Buffalo Creek SPV, as the case may be)
for such asset shall be paid to AYE, its Regulated Subsidiaries
or Buffalo Creek SPV, as the case may
80
be, solely in cash or Cash Equivalents, (C) no portion of the
non-cash proceeds received by AYE and its Subsidiaries shall
consist of Debt of, or Equity Interests in, AYE or any of its
Regulated Subsidiaries, (D) no Default shall have occurred and
be continuing, (E) on or prior to such sale, transfer or
disposition, (1) all Debt (other than under this Agreement) of
AYE and its Subsidiaries required by the terms thereof to be
repaid or prepaid upon such sale, transfer or disposition shall
have been so paid and (2) the relevant portion of the proceeds
thereof required to be applied to the prepayment of the Advances
and/or the Cash Collateralization of the L/C Obligations shall
have been applied in accordance with the terms contained in
clause (1) of the proviso at the end of this Section 5.02(e),
and (F) AYE would be in compliance with the covenants set forth
in Section 5.04 as of the most recently completed period ending
prior to such transaction for which financial statements and
certificates required by Section 5.03(b) or 5.03(c) were
required to have been delivered or for which comparable
financial statements have been filed with the SEC, in each case
after giving effect to such transaction and to any other event
occurring during such period as to which pro forma recalculation
is reasonably appropriate (including any other transaction
described in this clause occurring after such period) as if such
transaction (and the repayment of any Debt in connection
therewith) had occurred as of the first day of such period;
(x) sales or transfers of Equity Interests in AYE to any Plan;
(xi) the issuance of any Equity Interest by AYE or any of its
Subsidiaries;
(xii) sales, transfers, leases or other dispositions of Assets
to any Joint Venture or Buffalo Creek SPV to the extent
permitted under Section 5.02(f)(x); and
(xiii) the sale, transfer or other disposition of, or grant of
any option or other right to purchase, lease or otherwise
acquire any Emissions Credits other than in the ordinary course
of business; provided that, to the extent such sale, transfer or
other disposition of or grant of any option or other right to
purchase, lease or otherwise acquire results in Net Cash
Proceeds to AYE and its Subsidiaries (other than the AESC
Companies) in excess of $100,000,000 in the aggregate from all
such sales, transfers or other dispositions of or grant of any
option or other right to purchase, lease or otherwise acquire
Emission Credits in any Fiscal Year, the Net Cash Proceeds
therefrom in excess of such $100,000,000 shall be required to be
applied to prepay the Advances in accordance with the provisions
of Section 2.06(b);
provided that in the case of sales, transfers or other dispositions of Assets
pursuant to clause (vi), (ix) and (xiii) (but only to the extent contemplated
in such clause (xiii) above), AYE shall prepay the Advances and/or Cash
Collateralize the L/C Obligations in accordance with the provisions of Section
2.06(b).
(f) Investments in Other Persons. Make or hold, or permit any of its
Subsidiaries (other than any Regulated Subsidiary or any AESC Company) to make
or hold, any Investment in any Person, except:
81
(i) (A) equity Investments outstanding as of the date
hereof by AYE and its Subsidiaries in their respective
Subsidiaries or Affiliates, (B) equity Investments after the
date hereof in direct or indirect Subsidiaries of AYE, (C)
Investments after the date hereof in direct or indirect
Subsidiaries of AYE consisting of intercompany Debt and (D)
Investments after the date hereof in the AESC Companies
consisting of purchases or other acquisitions of Assets from
such AESC Companies; provided (1) with respect to clauses (B),
(C) and (D), AYE shall not be permitted to make any additional
equity Investment in any AESC Company or any additional
Investment in any AESC Company consisting of intercompany Debt
or the purchase or other acquisition of Assets from such AESC
Company unless the aggregate amount of the Unused Commitments
shall be equal to or greater than $100,000,000 after giving pro
forma effect to such additional Investment and (2) Services Corp
shall be permitted to make Investments in any AESC Company to
the extent of permitted Services Corp AESC Debt;
(ii) loans and advances to its employees (or, in the case
of Services Corp, employees of AYE or any of its Subsidiaries)
in the ordinary course of its business as presently conducted in
an aggregate principal amount, not to exceed $2,000,000 at any
time outstanding;
(iii) Investments in Cash Equivalents;
(iv) Investments in Hedge Agreements and Commodity Hedge
Agreements permitted pursuant to Section 5.02(b)(v);
(v) Investments in Subsidiaries of AYE resulting from
drawings under, or renewals or extensions of letters of credit
(including Letters of Credit), surety bonds, Contingent
Obligations or performance bonds supporting obligations of such
Subsidiaries incurred in the ordinary course of business but in
any event not for speculative obligations of such Subsidiaries,
provided that the aggregate amount of Investments in AESC
Companies resulting from drawings under letters of credit
(including Letters of Credit) outstanding at any time shall not
exceed $175,000,000;
(vi) Investments in any non-cash proceeds received by AYE
or any Subsidiary of AYE in connection with any sale, transfer
or other disposition of any Asset to the extent permitted under
Section 5.02(e);
(vii) Investments consisting of extensions of credit in
the nature of accounts receivable or notes receivable arising
from the grant of trade credit in the ordinary course of
business, and Investments received in satisfaction or partial
satisfaction thereof from financially troubled account debtors
to the extent reasonably necessary in order to prevent or limit
loss;
(viii) Investments not otherwise permitted under this
Section 5.02(f) existing on the Closing Date;
(ix) Investments by AYE and its Subsidiaries not otherwise
permitted under this Section 5.02(f) in an aggregate amount not
to exceed $100,000,000 plus an amount equal to the total of (a)
the aggregate principal amount of the Term Facility optionally
82
prepaid by AYE pursuant to Section 2.06(a), (b) the aggregate
amount of any optional prepayments of Revolving Advances by AYE
pursuant to Section 2.06(a) if and to the extent the Revolving
Commitments are terminated by AYE pursuant to Section 2.05(a)
concurrently with, and in an amount equal to, such prepayment,
and (c) the Net Cash Proceeds received by AYE as a result of any
sale, transfer or other disposition of any Assets or issuance of
any Equity Interests after the Closing Date by AYE or its
Subsidiaries (and which have not been applied to prepay the
Advances or cancel the Commitments pursuant to clause (a) or (b)
above) at any one time; provided that with respect to each
Investment made pursuant to this Section 5.02(f)(ix): (A) such
Investment shall not include or result in any contingent
liabilities that could reasonably be expected to be material to
the business, financial condition, operations or prospects of
AYE and its Subsidiaries, taken as a whole (as determined in
good faith by the board of directors (or persons performing
similar functions) of AYE or such Subsidiary if the board of
directors is otherwise approving such transaction and, in each
other case, by a Responsible Officer); (B) such Investment shall
be in Assets which are part of, or in lines of business which
are in or reasonably related to, the electric power generation,
transmission, distribution and/or energy trading businesses; (C)
any determination of the amount of such Investment shall include
all cash and noncash consideration (including, without
limitation, the Fair Market Value of all Equity Interests issued
or transferred to the sellers thereof, all indemnities, earnouts
and other contingent payment obligations to, and the aggregate
amounts paid or to be paid under noncompete, consulting and
other affiliated agreements with, the sellers thereof, all
write-downs of Assets and reserves for liabilities with respect
thereto and all assumptions of debt, liabilities and other
obligations in connection therewith) paid by or on behalf of AYE
and its Subsidiaries in connection with such Investment; and
(D)(1) immediately before and giving pro forma effect to any
such purchase or other acquisition, no Default shall have
occurred and be continuing and (2) immediately after giving
effect to such purchase or other acquisition AYE and its
Subsidiaries shall be in pro forma compliance with all of the
covenants set forth in Section 5.04, such compliance to be
determined on the basis of the financial information most
recently delivered to the Administrative Agent pursuant to
Section 5.03(b) or 5.03(c) as though such Investment had been
consummated as of the first day of the fiscal period covered
thereby;
(x) Investments by AYE and its Subsidiaries in Joint
Ventures, any Buffalo Creek SPV and the Buffalo Reserve Project
in an aggregate amount not to exceed $75,000,000;
provided that this Section 5.02(f) shall not prohibit (A) any repurchase of
Debt of AYE by AYE or any repurchase of Debt of any Subsidiary of AYE by such
Subsidiary, in each case, to the extent such repurchase is not otherwise
prohibited by the other provisions in this Agreement, (B) any purchase or
acquisition of Intangible Transition Property, Environmental Control Property
or other Assets subject to a Permitted Securitization or subject to an Asset
sale, lease, transfer, swap or exchange, in each case, permitted by Section
5.02(e)(viii), (C) any capital contribution to any Securitization SPV with
respect to any Permitted Securitization and (D) the repurchase or other
acquisition of shares of, or options to purchase shares of, the capital stock
and stock units of AYE from employees, former employees, directors and former
directors of AYE or any
83
Subsidiary of AYE; provided that the aggregate consideration paid with respect
to all such repurchases and acquisitions since May 1, 2006 shall not exceed
$5,000,000.
(g) Restricted Payments. (i) Declare or pay any Restricted Payments
except cash distributions to holders of Preferred Interests issued by AYE or
interest payments, in cash, to holders of securities convertible into or
exchangeable for shares of capital stock of (or other ownership or profit
interests in) AYE, (ii) permit any of its Subsidiaries (other than a Buffalo
Creek SPV) to purchase, redeem, retire, defease or otherwise acquire for value
any Equity Interests in it or (iii) permit any of its Subsidiaries (other than
a Buffalo Creek SPV) to issue or sell any Equity Interests, other than, with
respect to clauses (i), (ii) and (iii), in the case of (A) the Regulated
Subsidiaries, Services Corp and any AESC Company, to AYE or to any Subsidiary
of AYE (other than an AESC Company), and (B) any AESC Company, in accordance
with the AESC Loan Documents; provided that notwithstanding the provisions of
clauses (i), (ii) and (iii), (1) AYE or any Subsidiary may sell, transfer or
contribute Equity Interests in AYE to any Plan, (2) AYE or Services Corp may
repurchase or otherwise acquire shares of, and options to purchase shares of,
AYE's capital stock and stock units from employees, former employees,
directors and former directors of AYE or any of its Subsidiaries; provided
that the aggregate consideration paid with respect to all such repurchases and
acquisitions since May 1, 2006 shall not exceed $5,000,000, (3) AYE or any
Subsidiary may exchange any of its outstanding Equity Interests for its common
stock or for Equity Interests of the same class in it, (4) MPC may (x)
repurchase, redeem, retire, defease or otherwise acquire for value its MPC
Preferred Stock and (y) issue and sell Equity Interests or Preferred Interests
in MPC, so long as the proceeds of each such issuance and sale (net of
reasonable and customary fees, costs and expenses (including fees of legal
counsel)) are applied to refinance its MPC Preferred Stock, and (5) AYE or any
Subsidiary of AYE may sell, transfer, swap, exchange or otherwise dispose of
Equity Interests in a Subsidiary of AYE in connection with Asset sales,
transfers, swaps, exchanges or other dispositions permitted by Section
5.02(e)(viii).
(h) Payment Restrictions Affecting AYE and its Subsidiaries. Enter into,
incur or permit to exist any agreement or other arrangement that prohibits or
restricts the ability of AYE or any of its Subsidiaries (other than any AESC
Company, a Securitization SPV or, in the case of clause (i), any Regulated
Subsidiary or Services Corp) to (i) create, incur or permit to exist any Lien
upon any of its property or assets or (ii) declare or pay any dividend or
other distribution in respect of its Equity Interests to AYE or repay or
prepay any Debt owed to, make loans or advances to, or otherwise invest in,
AYE or any of its Subsidiaries; provided that the foregoing shall not apply to
restrictions and conditions imposed by (A) Applicable Law, (B) any Loan
Document, (C) the terms of any Existing Debt as in effect on the date hereof
(or any Permitted Refinancing Debt incurred in connection therewith; provided
that, if such Permitted Refinancing Debt is not FMB Debt, (1) a Responsible
Officer of AYE has determined in good faith that the terms of any Debt of the
Person whose Debt is being refinanced by such Permitted Refinancing Debt
contain any such restrictions or limitations as are described in clause (i) or
(ii) above, the restrictions or limitations to be imposed as a result of the
incurrence of such Permitted Refinancing Debt are no more restrictive, taken
as a whole, than the most restrictive of any such existing restrictions or
limitations, (2) a Responsible Officer of AYE has determined in good faith
that such restrictions or limitations are customary for similar transactions
as of the date of such refinancing and (3) a Responsible Officer of AYE has
determined in good faith that such restrictions or limitations could not
reasonably be expected to result in a Material Adverse
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Effect), (D) any agreement in effect with respect to any Subsidiary at the
time such Subsidiary becomes a Subsidiary of AYE, so long as such agreement
was not entered into solely in contemplation of such Person becoming a
Subsidiary of AYE, (E) any negative pledge incurred or provided in favor of
any holder of Debt permitted under Section 5.02(b)(vi) solely to the extent
any such negative pledge relates to the property financed by or subject of
such Debt (or any Permitted Refinancing Debt incurred in connection therewith;
provided that, if such Permitted Refinancing Debt is not FMB Debt, (1) a
Responsible Officer of AYE has determined in good faith that the terms of any
Debt of the Person whose Debt is being refinanced by such Permitted
Refinancing Debt contain any such restrictions or limitations as are described
in clause (i) or (ii) above, the restrictions or limitations to be imposed as
a result of the incurrence of such Permitted Refinancing Debt are no more
restrictive, taken as a whole, than the most restrictive of any such existing
restrictions or limitations, (2) a Responsible Officer of AYE has determined
in good faith that such restrictions or limitations are customary for similar
transactions as of the date of such refinancing and (3) a Responsible Officer
of AYE has determined in good faith that such restrictions or limitations
could not reasonably be expected to result in a Material Adverse Effect), (F)
any agreement for the sale or disposition of Assets permitted under Section
5.02(e), provided that such restrictions and conditions apply only to the
Asset that is to be sold or the proceeds thereof, (G) any trading, netting,
operating, construction, service, supply, purchase, sale or similar agreement
to which AYE or any of its Subsidiaries is a party, entered into in the
ordinary course of business; provided that such agreement prohibits the
encumbrance of solely the Assets of AYE or such Subsidiary that are the
subject of that agreement, the payment rights arising thereunder and/or the
proceeds thereof and not to any other Asset of AYE or such Subsidiary or the
assets or property of any other Subsidiary, (H) customary provisions
restricting subletting or assignment of leases or customary provisions in
other agreements that restrict assignment of such agreements or rights
thereunder, which restrictions when taken as a whole, as determined in good
faith by a Responsible Officer of AYE, are not materially more restrictive
than any similar restrictions in effect on the Closing Date, (I) any negative
pledge provided for in joint venture agreements, stockholder or partnership
agreements, or organizational documents relating to joint ventures or
partnerships or agreements relating to the Buffalo Reserve Project, (J) any
such restrictions or limitations contained in any other agreement in effect on
the Closing Date and any amendments, modifications, restatements, renewals or
replacements thereof that are not materially more restrictive, taken as a
whole, as determined in good faith by a Responsible Officer of AYE, than the
restrictions or limitations in existence on the Closing Date, (K) the terms of
any Equity Interest, Preferred Interest or Debt issued to refinance any MPC
Preferred Stock so long as a Responsible Officer of AYE has determined in good
faith that any restrictions on the ability of MPC to declare or pay any
dividend or other distribution in respect of its Equity Interests to AYE or
any of its Subsidiaries imposed on MPC as a result of the refinancing of MPC
Preferred Stock (i) are customary for similar transactions as of the date of
such refinancing and, if any, such restrictions are applicable to MPC in
accordance with this Agreement immediately prior to such refinancing, are no
more onerous than the most onerous of such existing restrictions and (ii)
could not reasonably be expected to result in a Material Adverse Effect and
(L) the Constituent Documents of any Buffalo Creek SPV, or any agreement to
which AYE or a Buffalo Creek SPV is a party relating to the Buffalo Reserve
Project, so long as such restrictions or limitations could not reasonably be
expected to result in a Material Adverse Effect.
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(i) Sale-Leaseback Transactions. Create, incur, assume or suffer to
exist with respect to AYE, or permit any of its Subsidiaries (other than any
AESC Company) to create, incur, assume or suffer to exist, any obligations as
lessee for the rental or hire of real or personal property in connection with
any sale and leaseback unless the sale of such property is not otherwise
prohibited under Section 5.02(e) and any Capitalized Lease created as part of
such transaction is not otherwise prohibited under Section 5.02(b) or any Lien
arising as part of such transaction is not otherwise prohibited by Section
5.02(a). For the avoidance of doubt, the sale, lease, transfer, swap, exchange
or other disposition of Assets permitted pursuant to Section 5.02(e)(viii)(C)
shall not constitute a sale and leaseback of Assets that is subject to this
Section 5.02(i).
(j) Accounting Changes. Make or permit, or permit any of its
Subsidiaries to make or permit, any change in its Fiscal Year.
(k) Prepayments, Etc., of Debt. Prepay, redeem, purchase, defease or
otherwise satisfy or make any unscheduled payment, in each case, prior to the
scheduled maturity thereof in any manner, whether directly or indirectly, or
make any payment in violation of any subordination terms of, any Debt of AYE,
or amend, modify or change in any manner any material term or condition of any
such Debt, other than (i) prepayment of Debt outstanding under this Agreement,
(ii) to the extent required to effectuate or resulting from any sale of Assets
which is permitted under Section 5.02(e) and (iii) any other prepayment or
redemption of Debt (A) which is refinanced and prepaid with the proceeds of
Permitted Refinancing Debt permitted to be incurred under Section
5.02(b)(xvi), or (B) with a maturity date prior to the Final Maturity Date;
provided that, except where such prepayment or redemption is or is to be made
with the proceeds of Permitted Refinancing Debt permitted to be incurred under
Section 5.02(b)(xvi), after giving pro forma effect to such prepayment or
redemption, the aggregate amount of the Unused Commitments is equal to or
greater than $100,000,000.
(l) Speculative Transactions. Engage, or permit any of its Subsidiaries
to engage, in any transaction involving commodity options or futures contracts
or any similar speculative transactions (including take-or-pay contracts, long
term fixed price off-take contracts and contracts for the sale of power for
which physical delivery is not available) unless the same (i) is consistent
with the policy on Corporate Energy Risk Policy (as amended from time to time)
approved by such Borrower's board of directors or (ii) has been approved in
writing by the Required Lenders.
(m) Compliance with ERISA. (i) Terminate, or permit any of its ERISA
Affiliates to terminate, any Plan so as to result in any liability to it or
any ERISA Affiliate, which could reasonably be expected to have a Material
Adverse Effect, or (ii) permit to exist any Termination Event with respect to
a Plan which could reasonably be expected to have a Material Adverse Effect to
the extent such Termination Event is within the control of AYE.
SECTION 5.03. Reporting Covenants of AYE. AYE covenants and agrees that
on and after the date hereof and until the Notes, together with all accrued
interest thereon, fees and all other Senior Debt Obligations (other than
contingent indemnification obligations not yet due and payable) are paid in
full and all Commitments and each Letter of Credit shall have terminated, AYE
will furnish to the Administrative Agent and each Lender Party (it being
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understood that delivery to the Administrative Agent for posting by the
Administrative Agent of each of the following items on a electronic website
shall constitute delivery to each Lender Party by AYE and the Administrative
Agent hereby agrees to post on an electronic website or otherwise distribute
to the Lender Parties any such item delivered by AYE to the Administrative
Agent):
(a) Default Notices. As soon as possible and in any event within five
Business Days after any Responsible Officer of any Borrower becomes aware of
the occurrence of (i) any Default or (ii) any event, development or occurrence
reasonably likely to have a Material Adverse Effect, in the case of clause (i)
or (ii), continuing on the date of such statement, a statement of a
Responsible Officer of AYE setting forth the details of such Default or event,
development or occurrence (as applicable) and, in each case, the actions, if
any, which AYE has taken and proposes to take with respect thereto.
(b) Annual Financials. As soon as available and in any event within 15
days after they are required to be filed with the SEC, a copy of the annual
audit report for such year for AYE and its Subsidiaries including therein a
Consolidated balance sheet of AYE and its Subsidiaries as of the end of such
Fiscal Year and Consolidated statement of income and a Consolidated statement
of cash flows of AYE and its Subsidiaries for such Fiscal Year, in each case
accompanied by a report that is unqualified or is otherwise reasonably
acceptable to the Required Lenders of Pricewaterhouse Coopers (or such other
independent public accountants of recognized standing acceptable to the
Required Lenders), as filed with the SEC, together with, for each Fiscal Year,
(i) a certificate of such accounting firm stating that in the course of the
regular audit of the business of AYE and its Subsidiaries, which audit was
conducted by such accounting firm in accordance with generally accepted
auditing standards, nothing has come to such accounting firm's attention that
would cause it to believe that AYE has failed to comply with the covenants set
forth in Section 5.04, (ii) a schedule in form satisfactory to the
Administrative Agent of the computations prepared by AYE and used by such
accounting firm in determining, as to the fourth quarter of such Fiscal Year,
compliance with the covenants contained in Section 5.04, provided that in the
event of any change in GAAP used in the preparation of such financial
statements, AYE shall also provide, if necessary for the determination of
compliance with Section 5.04, a statement of reconciliation conforming such
financial statements to GAAP as in effect as of the Closing Date and (iii) a
certificate of the Chief Financial Officer of AYE stating that no Default has
occurred and is continuing or, if a default has occurred and is continuing, a
statement as to the nature thereof and the action that AYE has taken and
proposes to take with respect thereto.
(c) Quarterly Financials. As soon as available and in any event within
60 days after the end of each of the first three quarters of each Fiscal Year,
a Consolidated balance sheet of AYE and its Subsidiaries as of the end of such
quarter and a Consolidated statement of income and a Consolidated statement of
cash flows of AYE and its Subsidiaries for the period commencing at the end of
the previous fiscal quarter and ending with the end of such fiscal quarter, as
filed with the SEC, setting forth in each case in comparative form the
corresponding figures for the corresponding date or period of the preceding
Fiscal Year, all in reasonable detail and duly certified (subject to normal
year-end audit adjustments) by the Chief Financial Officer of AYE as having
been prepared in accordance with GAAP, together with (i) a certificate of said
officer stating that no Default has occurred and is continuing or, if a
Default has occurred and is
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continuing, a statement as to the nature thereof and the action that AYE has
taken and proposes to take with respect thereto and (ii) a schedule in form
satisfactory to the Administrative Agent of the computations used by AYE in
determining compliance with the covenants contained in Section 5.04, provided
that in the event of any change in GAAP used in the preparation of such
financial statements, AYE shall also provide, if necessary for the
determination of compliance with Section 5.04, a statement of reconciliation
conforming such financial statements to GAAP as in effect as of the Closing
Date.
(d) Budget. As soon as available, but in no event later than 30 days
after the commencement of each Fiscal Year of AYE, forecasts prepared by
management of AYE, in form reasonably satisfactory to the Administrative
Agent, of consolidated balance sheets, income statements and cash flow
statements of AYE and its Subsidiaries on a quarterly basis for such Fiscal
Year and on an annual basis for such Fiscal Year setting forth the assumptions
used for purposes of preparing the budget and promptly when available, any
significant revisions to such budget.
(e) Litigation. Promptly after the commencement thereof, notice of all
actions, suits, investigations, litigation and proceedings before any
Governmental Authority, domestic or foreign, affecting AYE or any of its
Subsidiaries of the type described in Section 4.01(e), and promptly after the
occurrence thereof, notice of any change in respect of the Disclosed
Litigation described on Schedule 3.01(b) which could reasonably be expected to
have a Material Adverse Effect.
(f) [Intentionally Omitted]
(g) Environmental Conditions. Promptly after the assertion or occurrence
thereof, notice of any Environmental Action against or of any noncompliance by
AYE or any of its Subsidiaries with any Environmental Law or Environmental
Permit that could (i) reasonably be expected to have a Material Adverse Effect
or (ii) cause any property to be subject to any restrictions on ownership,
occupancy, use or transferability under any Environmental Law, except where
the failure to do so could not reasonably be expected to have a Material
Adverse Effect.
(h) Other Information. (i) Promptly after receipt thereof by AYE or any
of its Subsidiaries, a copy of any "management letter" received by such Person
from its certified public accountants and the management's response thereto.
(ii) [Intentionally Omitted]
(iii) No later than one day prior to the anticipated receipt by AYE or
any Regulated Subsidiary of Net Cash Proceeds from any sale or other
disposition of any Assets of AYE or such Subsidiary the proceeds of which are
required to be applied to prepay L/C Borrowings, the Advances or Cash
Collateralize the L/C Obligations in accordance with Section 2.06, a
certificate of a Responsible Officer of AYE setting forth (A) a description of
the transaction giving rise to such Net Cash Proceeds, (B) the date or dates
upon which such Net Cash Proceeds are anticipated to be received by AYE or
such Subsidiary, (C) the amount of Net Cash Proceeds anticipated to be
received on such date or each of such dates (together with a
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schedule detailing the calculations necessary to determine the amount of such
Net Cash Proceeds), and (D) the amount of such Net Cash Proceeds that it is
anticipated will be applied to pay any L/C Borrowings, prepay the Advances or
Cash Collateralize the L/C Obligations.
(iv) Such other information respecting the business or properties, or
the condition or operations, financial or otherwise, of AYE or any of its
Subsidiaries as the Administrative Agent or any Lender Party acting through
the Administrative Agent may from time to time reasonably request.
SECTION 5.04. Financial Covenants. So long as any Advance or any other
Senior Debt Obligation (other than contingent indemnification obligations not
yet due and payable) of any Borrower shall remain unpaid, any Letter of Credit
shall be outstanding or any Lender Party shall have any Commitment hereunder,
AYE will not:
(a) Interest Coverage Ratio. Permit the Interest Coverage Ratio at the
end of a fiscal quarter to be less than (i) 2.00:1.00 for the fiscal quarter
ending on June 30, 2006, (ii) 2.25:1.00 for each fiscal quarter commencing
with the fiscal quarter ending on September 30, 2006 through the fiscal
quarter ending on December 31, 2006, (iii) 2.30:1.00 for the fiscal quarter
ending on March 31, 2007, (iv) 2.40:1.00 for the fiscal quarter ending on June
30, 2007, (iv) 2.50:1.00 for the fiscal quarter ending on September 30, 2007,
(v) 3.00:1.00 for each fiscal quarter commencing with the fiscal quarter
ending on December 31, 2007 through the fiscal quarter ending on June 30,
2011.
(b) Leverage Ratio. Permit the Leverage Ratio to be greater than (i)
6.75:1.00 at the end of each fiscal quarter commencing with the fiscal quarter
ending on March 31, 2006 through the fiscal quarter ending on December 31,
2006, (ii) 6.25:1.00 at the end of each fiscal quarter commencing with the
fiscal quarter ending March 31, 2007 through the fiscal quarter ending on
December 31, 2008, (iii) 4.00:1.00 at the end of each fiscal quarter
commencing with the fiscal quarter ending on March 31, 2009 through the fiscal
quarter ending on December 31, 2009, (iv) 3.50:1.00 at the end of each fiscal
quarter commencing with the fiscal quarter ending on March 31, 2010 through
the fiscal quarter ending on June 30, 2011.
ARTICLE VI
EVENTS OF DEFAULT
SECTION 6.01. Events of Default. If any of the following events,
conditions or occurrences (each, an "Event of Default") shall occur and be
continuing:
(a) (i) any Borrower shall fail to pay any principal of any Advance or
any L/C Obligation when the same shall become due and payable or (ii) any
Borrower shall fail to pay any interest on any Advance or any L/C Obligation,
or any Borrower shall fail to make any other payment under any Loan Document,
in each case under this clause (ii) within three Business Days after the same
becomes due and payable; or
(b) any representation, warranty, certification or statement of fact
made or deemed made by or on behalf of any Borrower herein, in any other Loan
Document, or in any
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document delivered in connection herewith or therewith shall be incorrect or
misleading in any material respect when made or deemed made; or
(c) any Borrower or any of its Subsidiaries shall fail to perform or
observe any term, covenant or agreement contained in Section 2.15, 5.01(f),
5.02 (other than Section 5.02(l)), 5.03(a) or 5.04; or
(d) any Borrower or any of its Subsidiaries shall fail to perform or
observe any term, covenant or agreement contained in Section 5.01(j), 5.02(l)
or 5.03 (other than Section 5.03(a) and 5.03(e)) and such failure shall remain
unremedied for 30 days after the date on which a Responsible Officer of any
Borrower becomes aware of such failure; provided that with respect to Section
5.03(h)(iii) no Event of Default shall have occurred as a result of the
failure to deliver the notice contemplated thereby if AYE has made the
prepayment associated therewith pursuant to Section 2.06(b); or
(e) any Borrower any of its Subsidiaries shall fail to perform or
observe any other covenant or agreement (not specified in Section 6.01(a),
6.01(c) or 6.01(d) above) contained in any Loan Document on its part to be
performed or observed and such failure shall remain unremedied for 60 days
after the date on which a Responsible Officer of such Borrower becomes aware
of such failure; or
(f) (i) AYE or any of its Subsidiaries (A) fails to make any payment
when due (whether by scheduled maturity, required prepayment, acceleration,
demand, or otherwise) in respect of any Debt (other than Debt under the Loan
Documents or Debt which is subject to Contest) having an aggregate principal
amount (including undrawn committed or available amounts and including amounts
owing to all creditors under any combined or syndicated credit arrangement) or
with respect to any Hedge Agreement with an Agreement Value of more than
$25,000,000 either individually or in the aggregate or (B) fails to observe or
perform any other agreement or condition relating to any such Debt or
contained in any instrument or agreement evidencing, securing or relating
thereto, or any other event occurs, the effect of which default or other event
is to cause, or to permit the holder or holders of such Debt (or a trustee or
agent on behalf of such holder or holders or beneficiary or beneficiaries) to
cause, with the giving of notice if required, (1) such Debt to be demanded,
become due, repurchased, prepaid, defeased or redeemed (automatically or
otherwise), (2) an offer to repurchase, prepay, defease or redeem such Debt to
be made, prior to its stated maturity, or (3) cash collateral in respect
thereof to be demanded; or (ii) there occurs under any Hedge Agreement an
Early Termination Date (as defined in such Hedge Agreement) resulting from (A)
any event of default under such Hedge Agreement as to which AYE or any
Subsidiary is the Defaulting Party (as defined in such Hedge Agreement) or (B)
any Termination Event (as so defined) under such Hedge Agreement as to which
AYE or any Subsidiary is an Affected Party (as defined in such Hedge
Agreement) and, in either event, the termination value owed by AYE or such
Subsidiary as a result thereof is greater than the $40,000,000 either
individually or in the aggregate; or
(g) any Insolvency Proceeding shall occur with respect to AYE or any of
its Subsidiaries; or
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(h) there is entered against AYE or any of its Subsidiaries (i) any
final judgment or order for the payment of money in an amount exceeding
$40,000,000 either individually or in the aggregate other than in respect of
the Xxxxxxx Xxxxx Litigation (to the extent not covered by independent
third-party insurance by an insurer that is rated at least "A" by A.M. Best
Company and such coverage is not the subject of a bona fide dispute), or (ii)
any one or more non-monetary final judgments that have, or could reasonably be
expected to have, individually or in the aggregate, a Material Adverse Effect
and, in the case of (i) or (ii), (y) enforcement proceedings are commenced by
any creditor upon such judgment or order and such proceedings are not stayed
within 10 Business Days, or (z) there is a period of 30 consecutive days
during which a stay of enforcement of such judgment, by reason of a pending
appeal or otherwise, is not in effect; or
(i) any material provision of any Loan Document shall be canceled,
terminated, declared to be null and void or shall otherwise cease to be valid
and binding on any Borrower, in each case, as determined in a final,
non-appealable judgment of a court of competent jurisdiction, or any Borrower
shall deny in writing any further liability or obligation under any provision
of any Loan Document; provided, however, that the foregoing provisions of this
clause (i) shall not apply to any Loan Document that is canceled, terminated,
declared to be null and void or which ceases to be valid or binding on any
Borrower in accordance with its terms or by agreement of the requisite parties
thereto; or
(j) a Change of Control shall occur; or
(k) as a result of, or in connection with, an ERISA Event that shall
have occurred with respect to a Plan, AYE or any Subsidiary or any ERISA
Affiliate has incurred or is reasonably expected to incur liability in an
amount exceeding, in the aggregate with any amounts applicable under clauses
(l) and (m) of this Section 6.01, $25,000,000; or
(l) AYE, any of its Subsidiaries or any ERISA Affiliate shall have been
notified by the sponsor of a Multiemployer Plan that it has incurred
Withdrawal Liability to such Multiemployer Plan in an amount that, when
aggregated with all other amounts required to be paid to Multiemployer Plans
by AYE, any of its Subsidiaries and the ERISA Affiliates as Withdrawal
Liability (determined as of the date of such notification), exceeds, in the
aggregate with any amounts applicable under clauses (k) and (m) of this
Section 6.01, $25,000,000 or requires payments exceeding $25,000,000 per
annum; or
(m) AYE or any of its Subsidiaries or any ERISA Affiliate shall have
been notified by the sponsor of a Multiemployer Plan that such Multiemployer
Plan is in reorganization or is being terminated, within the meaning of Title
IV of ERISA, and as a result of such reorganization or termination the
aggregate annual contributions of AYE, its Subsidiaries and the ERISA
Affiliates to all Multiemployer Plans that are then in reorganization or being
terminated have been or will be increased over the amounts contributed to such
Multiemployer Plans for the plan years of such Multiemployer Plans immediately
preceding the plan year in which such reorganization or termination occurs by
an amount exceeding, in the aggregate with any amounts applicable under
clauses (k) and (l) of this Section 6.01, $25,000,000;
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then, and in any such event, the Administrative Agent (i) shall at the
request, or may with the consent, of the Required Lenders, by notice to the
Borrowers, declare all or any part of the Commitments of each Lender Party and
the obligation of each Lender Party to make Advances and of the Issuing Banks
to make L/C Credit Extensions to be terminated, whereupon the same shall
forthwith terminate, and (ii) shall at the request, or may with the consent,
of the Required Lenders, (A) (I) by notice to the Borrowers, declare all or
any part of the Notes, all interest thereon and all other amounts payable
under this Agreement and the other Loan Documents owing to the Lenders to be
forthwith due and payable, whereupon the Notes, all such interest and all such
amounts shall become and be forthwith due and payable, without presentment,
demand, protest or further notice of any kind, all of which are hereby
expressly waived by the Borrowers; provided that upon the occurrence of any
Event of Default described in Section 6.01(g), (1) the Commitments of each
Lender Party and the obligation of each Lender Party to make Advances and of
the Issuing Banks to make L/C Credit Extensions shall automatically be
terminated and (2) the Notes, all such interest and all such amounts shall
automatically become and be due and payable, without presentment, demand,
protest or any notice of any kind, all of which are hereby expressly waived by
the Borrowers, and the obligation of the Borrowers to Cash Collateralize the
L/C Obligations as aforesaid shall automatically become effective, in each
case, without further act of the Administrative Agent or any Lender.
SECTION 6.02. Actions in Respect of Letters of Credit upon Default. If
any Event of Default shall have occurred and be continuing, the Administrative
Agent may, or shall at the request of the Required Lenders, irrespective of
whether it is taking any of the actions described in Section 6.01 or
otherwise, make demand upon each Borrower to, and forthwith upon such demand
such Borrower will, Cash Collateralize, for deposit in the Cash Collateral
Account, an amount equal to the Outstanding Amount of all L/C Obligations for
which such Borrower is the Related Borrower. If at any time the Administrative
Agent determines that any Cash Collateral is subject to any right or claim of
any Person other than the Administrative Agent and the Lender Parties or that
the Cash Collateral is less than the Outstanding Amount of all L/C Obligations
for which a Borrower is the Related Borrower, such Borrower will, forthwith
upon demand by the Administrative Agent, pay to the Administrative Agent,
additional Cash Collateral to be deposited and held in the Cash Collateral
Account, in an amount equal to the excess of (a) such aggregate Outstanding
Amount of all L/C Obligations for which such Borrower is the Related Borrower
over (b) the total amount of Cash Collateral that the Administrative Agent
determines to be free and clear of any such right and claim.
ARTICLE VII
THE ADMINISTRATIVE AGENT
SECTION 7.01. Authorization and Action. Each Lender Party hereby
appoints and authorizes the Administrative Agent to take such action as agent
on its behalf and to exercise such powers and discretion under this Agreement
and the other Loan Documents as are delegated to the Administrative Agent by
the terms hereof and thereof, together with such powers and discretion as are
reasonably incidental thereto. As to any matters not expressly provided for by
the Loan Documents (including enforcement or collection of the Notes), the
Administrative Agent shall not be required to exercise any discretion or take
any action, but shall be required to act or to refrain from acting (and shall
be fully protected in so acting or refraining from acting) upon the
instructions of the Required Lenders, and such instructions shall be binding
upon all
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Lender Parties and all holders of Notes; provided, however, that the
Administrative Agent shall not be required to take any action that exposes the
Administrative Agent to personal liability or that is contrary to this
Agreement or Applicable Law. The Administrative Agent agrees to give to each
Lender Party prompt notice of each notice given to it by any Borrower or any
other Person pursuant to the terms of this Agreement or any other Loan
Documents.
SECTION 7.02. Administrative Agent's Reliance, Etc. Neither the
Administrative Agent nor any of its directors, officers, agents or employees
shall be liable for any action taken or omitted to be taken by it or them
under or in connection with the Loan Documents, except for its or their own
gross negligence or willful misconduct. Without limitation of the generality
of the foregoing, the Administrative Agent: (a) may treat the payee of any
Note as the holder thereof until the Administrative Agent receives and accepts
an Assignment and Acceptance entered into by the Lender that is the payee of
such Note, as assignor, and an Eligible Assignee, as assignee, as provided in
Section 8.07; (b) may consult with legal counsel (including counsel for any
Borrower), independent public accountants and other experts selected in good
faith by it and shall not be liable for any action taken or omitted to be
taken in good faith by it in accordance with the advice of such counsel,
accountants or experts; (c) makes no warranty or representation to any Lender
Party and shall not be responsible to any Lender Party for any statements,
warranties or representations (whether written or oral) made in or in
connection with the Loan Documents; (d) shall not have any duty to ascertain
or to inquire as to the performance or observance of any of the terms,
covenants or conditions of any Loan Document on the part of any Borrower or to
inspect the property (including the books and records) of any Borrower; (e)
shall not be responsible to any Lender Party for the due execution, legality,
validity, enforceability, genuineness, sufficiency or value of, or the
perfection or priority of any lien or security interest created or purported
to be created under or in connection with, any Loan Document or any other
instrument or document furnished pursuant thereto; and (f) shall incur no
liability under or in respect of any Loan Document by acting upon any notice,
consent, certificate or other instrument or writing (which may be by telegram,
telecopy or telex) reasonably believed by it to be genuine and signed or sent
by the proper party or parties.
SECTION 7.03. CNAI, CGMI, Citibank, CSCI and Affiliates. With respect to
its Commitment, the Advances made by it, the L/C Credit Extensions and the
Notes issued to it, CNAI, CGMI, Citibank and CSCI shall have the same rights
and powers under the Loan Documents as any other Lender and may exercise the
same as though it were not the Administrative Agent or an Arranger Party,
respectively; and the terms "Lender", "Lenders", "Revolving Lender",
"Revolving Lenders", "Term Lender" or "Term Lenders" shall, unless otherwise
expressly indicated, include each of CNAI, CGMI, Citibank and CSCI in its
individual capacity, as applicable. CNAI, CGMI, Citibank and CSCI and their
respective Affiliates may accept deposits from, lend money to, act as trustee
under indentures of, accept investment banking engagements from and generally
engage in any kind of business with, any Borrower, any Subsidiary of any
Borrower and any Person that may do business with or own securities of any
Borrower or any such Subsidiary, all as if CNAI, CGMI, Citibank and CSCI were
not the Administrative Agent or an Arranger Party, respectively, and without
any duty to account therefor to the Lenders.
SECTION 7.04. Lender Party Credit Decision. Each Lender Party
acknowledges that it has, independently and without reliance upon the
Administrative Agent, any Arranger
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Party or any other Lender Party, and based on the financial statements
referred to in Sections 4.01(f), 5.03(b) and 5.03(c) hereto and such other
documents and information as it has deemed appropriate, made its own credit
analysis and decision to enter into this Agreement and the other Loan
Documents to which it is a party. Each Lender Party also acknowledges that it
will, independently and without reliance upon the Administrative Agent, any
Arranger Party or any other Lender Party and based on such documents and
information as it shall deem appropriate at the time, continue to make its own
credit decisions in taking or not taking action under this Agreement and the
other Loan Documents to which it is a party.
SECTION 7.05. Indemnification. (a) Each Lender severally agrees to
indemnify the Administrative Agent and the Arranger Parties (in each case to
the extent not promptly reimbursed by the Borrowers) from and against such
Lender's ratable share (determined as provided below) of any and all
liabilities, obligations, losses, damages, penalties, actions, judgments,
suits, costs, expenses or disbursements of any kind or nature whatsoever that
may be imposed on, incurred by, or asserted against the Administrative Agent
or any Arranger Party, as the case may be, in any way relating to or arising
out of the Loan Documents or any action taken or omitted by the Administrative
Agent or any Arranger Party under the Loan Documents (collectively, the
"Indemnified Costs"); provided that no Lender shall be liable for any portion
of such liabilities, obligations, losses, damages, penalties, actions,
judgments, suits, costs, expenses or disbursements resulting directly and
primarily from the Administrative Agent's or such Arranger Party's gross
negligence or willful misconduct as found in a final, non-appealable judgment
by a court of competent jurisdiction. Without limitation of the foregoing,
each Lender agrees to reimburse the Administrative Agent and each Arranger
Party promptly upon demand for its ratable share of any costs and expenses
(including fees and expenses of counsel) payable by any Borrower under Section
8.04, to the extent that the Administrative Agent or such Arranger Party is
not promptly reimbursed for such costs and expenses by such Borrower. In the
case of any investigation, litigation or proceeding giving rise to any
Indemnified Costs, this Section 7.05 applies whether any such investigation,
litigation or proceeding is brought by any Lender or any other Person.
(b) Each Lender severally agrees to indemnify each Issuing Bank (to the
extent not promptly reimbursed by any Borrower) from and against such Lender's
ratable share (determined as provided below) of any and all liabilities,
obligations, losses, damages, penalties, actions, judgments, suits, costs,
expenses or disbursements of any kind or nature whatsoever that may be imposed
on, incurred by, or asserted against any Issuing Bank in any way relating to
or arising out of the Loan Documents or any action taken or omitted by such
Issuing Bank under the Loan Documents (including the issuance or transfer of,
or payment or failure to pay under, any Letter of Credit); provided that no
Lender shall be liable for any portion of such liabilities, obligations,
losses, damages, penalties, actions, judgments, suits, costs, expenses or
disbursements resulting directly and primarily from such Issuing Bank's gross
negligence or willful misconduct as found in a final, non-appealable judgment
by a court of competent jurisdiction. Without limitation of the foregoing,
each Lender agrees to reimburse such Issuing Bank promptly upon demand for its
ratable share of any costs and expenses (including, without limitation, fees
and expenses of counsel) payable by any Borrower under Section 8.04, to the
extent that such Issuing Bank is not promptly reimbursed for such costs and
expenses by such Borrower.
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(c) For purposes of this Section 7.05, the Lenders' respective ratable
shares of any amount shall be determined, at any time, according to the sum of
(i) the aggregate principal amount of the Advances outstanding at such time
and owing to the respective Lenders and (ii) their respective Pro Rata Shares
of the L/C Obligations outstanding at such time; provided that the aggregate
principal amount of L/C Credit Extensions owing to such Issuing Bank shall be
considered to be owed to the Revolving Lenders ratably in accordance with
their respective Revolving Commitments. The failure of any Lender to reimburse
the Administrative Agent, any Arranger Party or any Issuing Bank, as the case
may be, promptly upon demand for its ratable share of any amount required to
be paid by the Lenders to the Administrative Agent, any Arranger Party or any
Issuing Bank, as the case may be, as provided herein shall not relieve any
other Lender of its obligation hereunder to reimburse the Administrative
Agent, any Arranger Party or any Issuing Bank, as the case may be, for its
ratable share of such amount, but no Lender shall be responsible for the
failure of any other Lender to reimburse the Administrative Agent, any
Arranger Party or any Issuing Bank, as the case may be, for such other
Lender's ratable share of such amount. Without prejudice to the survival of
any other agreement of any Lender hereunder, the agreement and obligations of
each Lender contained in this Section 7.05 shall survive the payment in full
of principal, interest and all other amounts payable hereunder and under the
other Loan Documents.
SECTION 7.06. Successor Administrative Agent. The Administrative Agent
may resign at any time by giving written notice thereof to the Lender Parties
and the Borrowers and may be removed at any time with or without cause by the
Required Lenders. Upon any such resignation or removal, the Required Lenders
shall have the right to appoint a successor Administrative Agent. If no
successor Administrative Agent shall have been so appointed by the Required
Lenders, and shall have accepted such appointment, within 30 days after the
retiring Administrative Agent's giving of notice of resignation or the
Required Lenders' removal of the retiring Administrative Agent, then the
retiring Administrative Agent may, on behalf of the Lender Parties, appoint a
successor Administrative Agent, which shall be a commercial bank organized
under the laws of the United States or of any State thereof and having a
combined capital and surplus of at least $500,000,000. Upon the acceptance of
any appointment as Administrative Agent hereunder by a successor
Administrative Agent, such successor Administrative Agent shall succeed to and
become vested with all the rights, powers, discretion, privileges and duties
of the retiring Administrative Agent, and the retiring Administrative Agent
shall be discharged from its duties and obligations under the Loan Documents.
After any retiring Administrative Agent's resignation or removal hereunder as
Administrative Agent shall have become effective, the provisions of this
Article VII shall inure to its benefit as to any actions taken or omitted to
be taken by it while it was Administrative Agent under the Loan Documents.
SECTION 7.07. Liability. Neither the Administrative Agent nor any
Arranger Party shall be liable for any error of judgment or for any act done
or omitted to be done by it in good faith or for any mistake of fact or law,
or for anything it may do or refrain from doing, except to the extent that any
such liability is found in a final, non-appealable judgment by a court of
competent jurisdiction to have resulted directly and primarily from its gross
negligence or willful misconduct.
SECTION 7.08. Treatment of Lenders. Each of the Administrative Agent and
the Arranger Party may treat the Lender Parties as the holders of Commitments
or L/C Credit
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Extensions and as the absolute owners thereof for all purposes under this
Agreement and the other Loan Documents unless the Administrative Agent and the
Arranger Party shall receive notice to the contrary from such Lender Party.
SECTION 7.09. Miscellaneous. (a) Instructions. The Administrative Agent
shall have the right at any time to seek instructions concerning the
administration of its duties and obligations hereunder or under any other Loan
Documents from the Lenders or any court of competent jurisdiction. In the
event there is any disagreement between the parties to this Agreement and the
terms of this Agreement do not unambiguously mandate the action the
Administrative Agent is to take or not to take in connection therewith under
the circumstances then existing, or the Administrative Agent is in doubt as to
what action it is required to take or not to take, the Administrative Agent
(other than the actions required of it under the final sentence of Section
7.01) shall be entitled to refrain from taking any action until directed
otherwise in writing by a request signed jointly by the Required Lenders or by
order of a court of competent jurisdiction.
(b) No Obligation. None of the provisions of this Agreement or the other
Loan Documents shall be construed to require the Administrative Agent to
expend or risk its own funds or otherwise to incur any personal financial
liability in the performance of any of its duties hereunder or thereunder. The
Administrative Agent shall not be under any obligation to exercise any of the
rights or powers vested in it by this Agreement or the other Loan Documents,
at the request or direction of any Borrower, or any Lender Party, (i) if any
action it has been requested or directed to take would be contrary to
Applicable Law, or (ii) unless the Administrative Agent shall have been
offered security or indemnity reasonably satisfactory to it against the costs,
expenses and liabilities that might be incurred by it in compliance with such
request or direction (including interest thereon from the time incurred until
reimbursed).
SECTION 7.10. Arranger Parties. Except as set forth in Sections 7.03 and
8.12, none of the Lenders or other Persons identified on the facing page or
signature pages of this Agreement as a "joint lead arranger", "lead arranger",
"joint book runner" or "syndication agent", shall have any right, power,
obligation, liability, responsibility or duty under this Agreement or any
other Loan Document other than, in the case of such Lenders, those applicable
to all Lenders as such. Without limiting the foregoing, none of the Lenders or
other Persons so identified shall have or be deemed to have any fiduciary
relationship with any Lender. Each Lender acknowledges that it has not relied,
and will not rely, on any of the Lenders or other Persons so identified in
deciding to enter into this Agreement or in taking or not taking action
hereunder.
ARTICLE VIII
MISCELLANEOUS
SECTION 8.01. Amendments, Etc.. No amendment or waiver of any provision
of this Agreement and the Notes, nor consent to any departure by any Borrower
therefrom, shall in any event be effective unless the same shall be in writing
and signed by the Required Lenders and, in the case of an amendment only, the
Borrowers, and then such amendment, waiver or consent shall be effective only
in the specific instance and for the specific purpose for which given;
provided that no amendment waiver or consent shall, unless in writing and
signed by: (a)
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all of the Lenders at any time amend (i) this Section 8.01, (ii) the term
"Required Lenders" or (iii) any other provision or definition of this
Agreement relating to the percentage of consent required for any amendment,
waiver or consent under this Agreement (other than pursuant to clause (b)),
(b) all of the Revolving Lenders amend the term "Required Revolving Lenders";
and (c) all of the Lenders affected thereby, at any time (i) reduce the
principal of, or rates of interest on, the Notes or any fees or other amounts
payable hereunder or extend or postpone any scheduled dates for payment
thereof (including pursuant to Section 2.05, 2.06 or 2.07), (ii) extend the
Final Maturity Date, (iii) increase any Commitment or subject any Lender Party
to any additional obligation, (iv) increase the amount of any Letter of Credit
that, in each case, shall be required for the Required Lenders or any of them
to take any action hereunder, (v) alter any provision of this Agreement
requiring the pro rata sharing of payments among the Lender Parties, (vi)
modify any provision or definition of this Agreement or of Exhibit C relating
to the percentage of consents required in connection with any assignment or
participation of any right or obligation under this Agreement, (vii) limit the
liability of any Borrower hereunder or under any of the Notes and (viii) amend
the definition of "Interest Period" so as to allow the durations of Interest
Periods to be in excess of six months without regard to the availability to
all Lenders of such duration; provided further that (A) no amendment, waiver
or consent shall, unless in writing and signed by the Administrative Agent or
the Issuing Banks, as the case may be, in addition to the Lenders required
above to take such action, affect the rights or duties of the Administrative
Agent or any Issuing Bank under this Agreement, and (B) Section 8.07(h) may
not be amended, waived or otherwise modified without the consent of each
Granting Lender all or any part of whose Advances are being funded by any SPV
at the time of such amendment, waiver or other modification.
SECTION 8.02. Notices, Etc. (a) Notices and other communications
provided for hereunder shall be either (i) in writing (including telecopier,
telegraphic or telex communication) and mailed, telecopied or otherwise
delivered or (ii) as and to the extent set forth in Section 8.02(b) and in the
proviso to this Section 8.02(a), if to any Borrower, to or care of AYE, at its
address at Allegheny Energy, Inc., 000 Xxxxx Xxxx Xxxxx, Xxxxxxxxxx, XX 00000,
Fax: (000) 000-0000, Attention: General Counsel and Chief Financial Officer;
if to any Initial Lender, the Initial Issuing Bank, any Lender or any Issuing
Bank, at its Domestic Lending Office; and if to the Administrative Agent, at
its address at Xxx Xxxxx Xxx, Xxx Xxxxxx, XX 00000; Attention: Bank Loan
Syndications Department; or, as to any Borrower or the Administrative Agent,
at such other address as shall be designated by AYE (on its own behalf or on
behalf of AESC) or the Administrative Agent, as the case may be, in a written
notice to the other parties and, as to each other party, at such other address
as shall be designated by such party in a written notice to AYE and the
Administrative Agent, provided that materials required to be delivered
pursuant to Sections 5.03(b) and 5.03(c) shall be delivered to the
Administrative Agent as specified in Section 8.02(b) or as otherwise specified
to AYE by the Administrative Agent. All such notices and communications shall,
when mailed, telecopied, telegraphed or e-mailed, be effective when deposited
in the mails, telecopied, delivered to the telegraph company or confirmed by
e-mail, respectively, except that notices and communications to the
Administrative Agent pursuant to Article II, Article III or Article VII shall
not be effective until received by the Administrative Agent. Delivery by
telecopier of an executed counterpart of any amendment or waiver of any
provision of this Agreement or the Notes or of any Exhibit hereto to be
executed and delivered hereunder shall be effective as delivery of a manually
executed counterpart thereof.
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(b) So long as CNAI is the Administrative Agent, each Borrower hereby
agrees that it will provide to the Administrative Agent all information,
documents and other materials that it is obligated to furnish to the
Administrative Agent pursuant to the Loan Documents, including, without
limitation, all notices, requests, financial statements, financial and other
reports, certificates and other information materials, but excluding any such
communication that (i) relates to a request for a new, or a conversion of an
existing, borrowing or other extension of credit (including any election of an
interest rate or interest period relating thereto), (ii) relates to the
payment of any principal or other amount due under the Agreement prior to the
scheduled date therefor, (iii) provides notice of any Default or (iv) is
required to be delivered to satisfy any condition precedent to the
effectiveness of the Agreement and/or any borrowing or other extension of
credit hereunder (all such non-excluded communications being referred to
herein collectively as "Communications"), by transmitting the Communications
in an electronic/soft medium in a format acceptable to the Administrative
Agent to xxxxxxxxxxxxxxx@xxxxxxxxx.xxx. In addition, each Borrower agrees to
continue to provide the Communications to the Administrative Agent in the
manner specified in the Loan Documents but only to the extent requested by the
Administrative Agent.
(c) Each Borrower further agrees that the Administrative Agent may make
the Communications available to the Lender Parties by posting the
Communications on Intralinks or a substantially similar electronic
transmission system (the "Platform").
(d) THE PLATFORM IS PROVIDED "AS IS" AND "AS AVAILABLE". THE AGENT
PARTIES (AS DEFINED BELOW) DO NOT WARRANT THE ACCURACY OR COMPLETENESS OF THE
COMMUNICATIONS, OR THE ADEQUACY OF THE PLATFORM AND EXPRESSLY DISCLAIM
LIABILITY FOR ERRORS OR OMISSIONS IN THE COMMUNICATIONS. NO WARRANTY OF ANY
KIND, EXPRESS, IMPLIED OR STATUTORY, INCLUDING, ANY WARRANTY OF
MERCHANTABILITY, FITNESS FOR A PARTICULAR PURPOSE, NON-INFRINGEMENT OF THIRD
PARTY RIGHTS OR FREEDOM FROM VIRUSES OR OTHER CODE DEFECTS, IS MADE BY THE
AGENT PARTIES IN CONNECTION WITH THE COMMUNICATIONS OR THE PLATFORM. IN NO
EVENT SHALL THE ADMINISTRATIVE AGENT OR ANY OF ITS AFFILIATES OR ANY OF THEIR
RESPECTIVE OFFICERS, DIRECTORS, EMPLOYEES, AGENTS, ADVISORS OR REPRESENTATIVES
(COLLECTIVELY, "AGENT PARTIES") HAVE ANY LIABILITY TO ANY BORROWER, ANY LENDER
OR ANY OTHER PERSON OR ENTITY FOR DAMAGES OF ANY KIND, INCLUDING DIRECT OR
INDIRECT, SPECIAL, INCIDENTAL OR CONSEQUENTIAL DAMAGES, LOSSES OR EXPENSES
(WHETHER IN TORT, CONTRACT OR OTHERWISE) ARISING OUT OF ANY BORROWER'S OR THE
ADMINISTRATIVE AGENT'S TRANSMISSION OF COMMUNICATIONS THROUGH THE INTERNET,
EXCEPT TO THE EXTENT THE LIABILITY OF ANY AGENT PARTY IS FOUND IN A FINAL
NON-APPEALABLE JUDGMENT BY A COURT OF COMPETENT JURISDICTION TO HAVE RESULTED
PRIMARILY FROM SUCH AGENT PARTY'S GROSS NEGLIGENCE OR WILLFUL MISCONDUCT.
(e) The Administrative Agent agrees that the receipt of the
Communications by the Administrative Agent at its e-mail address set forth
above shall constitute effective delivery of the Communications to the
Administrative Agent for purposes of the Loan Documents. Each Lender Party
agrees that receipt of notice to it (as provided in the next
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sentence) specifying that the Communications have been posted to the Platform
shall constitute effective delivery of the Communications to such Lender Party
for purposes of the Loan Documents. Each Lender Party agrees to notify the
Administrative Agent in writing (including by electronic communication) from
time to time of such Lender Party's e-mail address to which the foregoing
notice may be sent by electronic transmission and (ii) that the foregoing
notice may be sent to such e-mail address.
(f) Nothing herein shall prejudice the right of the Administrative Agent
or any Lender Party to give any notice or other communication pursuant to any
Loan Document in any other manner specified in such Loan Document.
SECTION 8.03. No Waiver, Remedies. No failure on the part of any Lender
Party or the Administrative Agent to exercise, and no delay in exercising, any
right hereunder or under any Note shall operate as a waiver thereof; nor shall
any single or partial exercise of any such right preclude any other or further
exercise thereof or the exercise of any other right. The remedies herein
provided are cumulative and not exclusive of any remedies provided by law.
SECTION 8.04. Costs and Expenses. (a) AYE agrees to pay within 30 days
(or earlier if, and to the extent, required under Article III) after the
presentation of an invoice all reasonable third-party costs and expenses of
(i) the Administrative Agent in connection with the administration of this
Agreement and the other Loan Documents and the transactions contemplated
hereby and thereby (but without duplication of such obligation under any other
Loan Document) and (ii) the Administrative Agent and the Arranger Parties in
connection with the preparation, negotiation, execution and delivery of this
Agreement, the Notes, the other Loan Documents and the other documents to be
delivered hereunder or thereunder, including (A) all due diligence,
syndication (including printing, distribution and bank meetings),
transportation, computer, duplication, appraisal, consultant, audit expenses
and, where appropriate, registration of all Loan Documents and (B) the
reasonable fees and expenses of counsel for the Administrative Agent. AYE
further agrees to pay on demand all costs and expenses of the Administrative
Agent, each Arranger Party and each Lender Party, if any (including reasonable
counsel fees and expenses), in connection with (1) the enforcement (whether
through negotiations, legal proceedings or otherwise) of this Agreement, the
Notes, the other Loan Documents and the other documents to be delivered
hereunder or thereunder, including reasonable fees and expenses of counsel for
the Administrative Agent, each Arranger Party and each Lender Party; (2) the
exercise or enforcement of any of the rights of the Administrative Agent, any
Arranger Party or any Lender Party under any Loan Document; (3) the failure by
any Borrower to perform or observe any of the provisions hereof; and (4) any
amendments, modifications, waivers or consents required or requested under the
Loan Documents.
(b) Each Borrower agrees to indemnify and hold harmless the
Administrative Agent, each Arranger Party and each Lender Party and each of
their Affiliates and their respective officers, directors, employees, agents,
trustees, attorneys and advisors (each, an "Indemnified Party") from and
against any and all claims, damages, losses, liabilities and expenses
(including reasonable fees and expenses of counsel) that may be incurred by or
asserted or awarded against any Indemnified Party, in each case arising out of
or in connection with or by reason of (including in connection with any
investigation, litigation or proceeding or preparation of a defense in
connection therewith) or relating to (i) execution, amendment or
administration of
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this Agreement, the other Loan Documents, any Letter of Credit, any of the
transactions contemplated herein or therein or the actual or proposed use of
the proceeds of the Advances or any L/C Borrowings, (ii) the issuance or
transfer of, or payment or failure to pay under, any Letter of Credit or (iii)
the actual or alleged presence of Hazardous Materials requiring remediation or
other response pursuant to Environmental Law on any property of such Borrower
or any of its Subsidiaries or any Environmental Action relating in any way to
such Borrower or any of its Subsidiaries, except to the extent such claim,
damage, loss, liability or expense is found in a final, non-appealable
judgment by a court of competent jurisdiction to have resulted directly and
primarily from such Indemnified Party's gross negligence or willful
misconduct. In the case of an investigation, litigation or other proceeding to
which the indemnity in this Section 8.04(b) applies, such indemnity shall be
effective whether or not such investigation, litigation or proceeding is
brought by any Borrower, its directors, equityholders or creditors or an
Indemnified Party or any other Person, whether or not any Indemnified Party is
otherwise a party thereto and whether or not the transactions contemplated
hereby are consummated. Each Borrower also agrees not to assert any claim
against the Administrative Agent, any Lender Party or any of their Affiliates,
or any of their respective officers, directors, employees, agents, attorneys
and advisors, on any theory of liability, for special, indirect, consequential
or punitive damages arising out of or otherwise relating to the Facilities,
the actual or proposed use of the proceeds of the Advances or any Letter of
Credit, the Loan Documents or any of the transactions contemplated by the Loan
Documents.
(c) The indemnities provided by each Borrower pursuant to this Agreement
shall survive the expiration, cancellation, termination or modification of
this Agreement or the other Loan Documents, the resignation or removal of the
Administrative Agent, and the provision of any subsequent or additional
indemnity by any Person.
(d) If any payment of principal of, or Conversion of, any Eurodollar
Rate Advance is made by any Borrower to or for the account of a Lender Party
other than on the last day of the Interest Period for such Advance, as a
result of a payment or Conversion pursuant to Section 2.06(a), 2.10(b) or
2.11(c), acceleration of the maturity of the Notes pursuant to Section 6.01 or
for any other reason, or if any Borrower fails to make any payment or
prepayment of an Advance for which a notice of prepayment has been given or
that is otherwise required to be made, whether pursuant to Section 2.04, 2.06
or 6.01 or otherwise, such Borrower shall, upon demand by such Lender Party
(with a copy of such demand to the Administrative Agent), pay to the
Administrative Agent for the account of such Lender Party any amounts required
to compensate such Lender Party for any additional losses, costs or expenses
that it may reasonably incur as a result of such payment or Conversion or such
failure to pay or prepay, as the case may be, including any loss (excluding
loss of anticipated profits), cost or expense incurred by reason of the
liquidation or reemployment of deposits or other funds acquired by any Lender
Party to fund or maintain such Advances.
(e) If any Borrower fails to pay when due any costs, expenses or other
amounts payable by it under any Loan Document, including fees and expenses of
counsel and indemnities, such amount may be paid on behalf of such Borrower by
the Administrative Agent or any Lender Party, in its sole discretion.
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SECTION 8.05. Right of Set-off. Upon (a) the occurrence and during the
continuance of any Event of Default and (b) the making of the request or the
granting of the consent specified by Section 6.02 to authorize the
Administrative Agent to declare the Notes due and payable pursuant to the
provisions of Section 6.02, the Administrative Agent and each Lender Party and
each of their respective Affiliates is hereby authorized at any time and from
time to time, to the fullest extent permitted by law, to set off and otherwise
apply any and all deposits (general or special, time or demand, provisional or
final) at any time held and other indebtedness at any time owing by the
Administrative Agent, such Lender Party or such Affiliate to or for the credit
or the account of any Borrower against any and all of the Obligations of such
Borrower now or hereafter existing under the Loan Documents, irrespective of
whether the Administrative Agent or such Lender Party shall have made any
demand under this Agreement or such Note or Notes and although such
Obligations may be unmatured. The Administrative Agent and each Lender Party
agrees promptly to notify the Borrowers after any such set-off and
application; provided, however, that the failure to give such notice shall not
affect the validity of such set-off and application. The rights of the
Administrative Agent and each Lender Party and their respective Affiliates
under this Section are in addition to other rights and remedies (including
other rights of set-off) that the Administrative Agent, such Lender Party and
their respective Affiliates may have.
SECTION 8.06. Binding Effect. This Agreement shall become effective at
such time as it shall have been executed by the Borrowers and the
Administrative Agent and the Administrative Agent shall have been notified by
each Initial Lender Party that such Initial Lender Party has executed it and
thereafter shall be binding upon and inure to the benefit of the Borrowers,
the Administrative Agent and each Lender Party and their respective successors
and assigns, except that each Borrower shall not have the right to assign its
rights hereunder or any interest herein without the prior written consent of
the Lender Parties.
SECTION 8.07. Assignments and Participations. (a) Each Lender Party may
and, if requested by AYE (following (i) a demand by such Lender Party for the
payment of additional compensation pursuant to Section 2.11 or 2.13, (ii) an
assertion by such Lender Party pursuant to Section 2.09 that it is unlawful
for such Lender Party to make Eurodollar Rate Advances or (iii) a failure by
such Lender Party to approve any amendment or waiver pursuant to Section 8.01,
provided that such amendment or waiver would otherwise have been effective but
for such Lender Party's failure, together with the failure of any other Lender
Party to which AYE has made a similar request under this clause (a), to
approve such amendment or waiver, provided further that, with respect to
clause (iii), such failure to approve shall have continued for a period of not
less than five Business Days following written notice by AYE to such Lender
Party of such request by AYE) shall, assign to one or more Eligible Assignees
all or a portion of its rights and obligations under this Agreement (including
(y) all or a portion of its Revolving Commitment, the Revolving Advances owing
to it, L/C Credit Extensions and the Revolving Note or Revolving Notes held by
it, and/or (z) all or a portion of its Term Commitment, the Term Advances
owing to it, and the Term Note or Term Notes held by it), including any pledge
or assignment to secure obligations to a Federal Reserve Bank; provided,
however, that (i) except in the case of an assignment to a Person that,
immediately prior to such assignment, was a Lender Party, an Affiliate of any
Lender Party or an Approved Fund or an assignment of all of a Lender Party's
rights and obligations under this Agreement, the aggregate amount of (A) any
Term Commitment or Term Advance being assigned to such Person pursuant to such
assignment
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(determined as of the date of the Assignment and Acceptance with
respect to such assignment) shall in no event be less than $5,000,000 (or such
lesser amount as shall be approved by the Administrative Agent) and shall be
in increments of $1,000,000 in excess thereof, or (B) any Revolving Commitment
or Revolving Advance being assigned to such Eligible Assignee pursuant to such
assignment (determined as of the date of the Assignment and Acceptance with
respect to such assignment) shall in no event be less than $5,000,000 (or such
lesser amount as shall be approved by the Administrative Agent) and shall be
in increments of $1,000,000 in excess thereof, (ii) each such assignment shall
be to an Eligible Assignee; provided that the Issuing Bank shall have sole
discretion to consent to such Person being an Eligible Assignee, (iii) (A)
with respect to any Term Commitment or any Term Advance, no such assignments
shall be permitted without the consent of the Administrative Agent (such
consent not to be unreasonably withheld) and, so long as no Specified Default
has occurred and is continuing, the consent of AYE (such consent not to be
unreasonably withheld), except assignments to any other Lender Party, an
Affiliate of any Lender, an Approved Fund or to any Federal Reserve Bank, and
(B) with respect to any Revolving Commitment, Revolving Advance, L/C Credit
Extension or L/C Borrowing, no such assignments shall be permitted without the
consent of any Issuing Bank acting in its sole discretion, the Administrative
Agent (such consent not to be unreasonably withheld or delayed) and, so long
as no Specified Default has occurred and is continuing, the consent of AYE
(such consent not to be unreasonably withheld), except, with respect to AYE's
consent only, assignments to any other Lender Party, an Affiliate of any
Lender, any Approved Fund or to any Federal Reserve Bank, and (iv) the parties
to each such assignment shall execute and deliver to the Administrative Agent,
for its acceptance and recording in the Register, an Assignment and
Acceptance, together with any Note or Notes subject to such assignment and a
processing and recordation fee of $3,500 (such fee to be paid by AYE if such
assignment is being made pursuant to a request of AYE therefor under this
Section 8.07(a)); provided that only one such fee shall be payable in the case
of contemporaneous assignments to or by two or more Approved Funds and (v)
with respect to Revolving Commitment or Revolving Advance, each such
assignment thereof shall be made on a pro rata basis with respect to each of
(A) such Revolving Lender's Revolving Advances and L/C Credit Extensions and
(B) such Revolving Lender's Revolving Commitment; provided further that (I)
each such assignment made as a result of a request by AYE pursuant to this
Section 8.07(a) shall be arranged by AYE with the approval of the
Administrative Agent, which approval shall not be unreasonably withheld or
delayed, and shall be either an assignment of all of the rights and
obligations of the assigning Lender under this Agreement or an assignment of a
portion of such rights and obligations made concurrently with another such
assignment or other such assignments that, in the aggregate, cover all of the
rights and obligations of the assigning Lender under this Agreement and (II)
no Lender shall be obligated to make any such assignment as a result of a
demand by AYE pursuant to this Section 8.07(a) unless and until such Lender
shall have received one or more payments from one or more Eligible Assignees
in an aggregate amount at least equal to the aggregate outstanding principal
amount of the Advances owing to such Lender, together with accrued interest
thereon to the date of payment of such principal amount, and from AYE and/or
one or more Eligible Assignees in an aggregate amount equal to all other
amounts payable to such Lender under this Agreement and the other Loan
Documents (including, without limitation, any amounts owing under Section
2.11, 2.13 or 8.04).
(b) Any Issuing Bank may assign to an Eligible Assignee all of its
rights and obligations under the undrawn portion of any Letter of Credit
Commitment at any time;
102
provided, however, that (i) each such assignment shall be to an Eligible
Assignee, (ii) the parties to each such assignment shall execute and deliver
to the Administrative Agent, for its acceptance and recording in the Register,
an Assignment and Acceptance, together with a processing and recordation fee
of $3,500 and (iii) so long as no Specified Default has occurred and is
continuing, AYE has consented to the assignment (such consent not to be
unreasonably withheld).
(c) Upon such execution, delivery, acceptance and recording, from and
after the effective date specified in such Assignment and Acceptance, (i) the
assignee thereunder shall be a party hereto and, to the extent that rights and
obligations hereunder have been assigned to it pursuant to such Assignment and
Acceptance, have the rights and obligations of a Lender or Issuing Bank, as
the case may be, hereunder and (ii) the Lender or Issuing Bank assignor
thereunder shall, to the extent that rights and obligations hereunder have
been assigned by it pursuant to such Assignment and Acceptance, relinquish its
rights (other than its rights under Sections 2.11, 2.13 and 8.04 to the extent
any claim thereunder relates to an event arising prior to such assignment) and
be released from its obligations under this Agreement (and, in the case of an
Assignment and Acceptance covering all of the remaining portion of an
assigning Lender's or Issuing Bank's rights and obligations under this
Agreement, such Lender or Issuing Bank shall cease to be a party hereto).
(d) By executing and delivering an Assignment and Acceptance, each
Lender Party assignor thereunder and each assignee thereunder confirm to and
agree with each other and the other parties thereto and hereto as follows: (i)
other than as provided in such Assignment and Acceptance, such assigning
Lender Party makes no representation or warranty and assumes no responsibility
with respect to any statements, warranties or representations made in or in
connection with any Loan Document or the execution, legality, validity,
enforceability, genuineness, sufficiency or value of any Loan Document or any
other instrument or document furnished pursuant thereto; (ii) such assigning
Lender Party makes no representation or warranty and assumes no responsibility
with respect to the financial condition of any Borrower or the performance or
observance by any Borrower of any of its obligations under any Loan Document
or any other instrument or document furnished pursuant thereto; (iii) such
assignee confirms that it has received a copy of this Agreement and each other
Loan Document, together with copies of the financial statements referred to in
Sections 4.01(f), 5.03(b) and 5.03(c) and such other documents and information
as it has deemed appropriate to make its own credit analysis and decision to
enter into such Assignment and Acceptance; (iv) such assignee will,
independently and without reliance upon the Administrative Agent, such
assigning Lender Party or any other Lender Party and based on such documents
and information as it shall deem appropriate at the time, continue to make its
own credit decisions in taking or not taking action under this Agreement or
any other Loan Document; (v) such assignee confirms that it is an Eligible
Assignee; (vi) such assignee appoints and authorizes the Administrative Agent
to take such action as agent on its behalf and to exercise such powers and
discretion under the Loan Documents as are delegated to the Administrative
Agent by the terms hereof and thereof, together with such powers and
discretion as are reasonably incidental thereto; and (vii) such assignee
agrees that it will perform in accordance with their terms all of the
obligations that by the terms of this Agreement and the other Loan Documents
are required to be performed by it as a Lender or Issuing Bank, as the case
may be.
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(e) The Administrative Agent shall maintain at its address referred to
in Section 8.02 a copy of each Assignment and Acceptance delivered to and
accepted by it and a register for the recordation of the names and addresses
of the Lender Parties and the Commitments of, and principal amount of the
Advances and L/C Borrowings owing to, each Lender Party from time to time (the
"Register"). The entries in the Register shall be conclusive and binding for
all purposes, absent manifest error, and the Borrowers, the Administrative
Agent and the Lender Parties shall treat each Person whose name is recorded in
the Register as a Lender Party hereunder for all purposes of this Agreement.
The Register shall be available for inspection by the Borrowers or the
Administrative Agent or any Lender Party at any reasonable time and from time
to time upon reasonable prior notice.
(f) Upon its receipt of an Assignment and Acceptance executed by an
assigning Lender Party and an assignee, together with any Note or Notes
subject to such assignment, the Administrative Agent shall, if such Assignment
and Acceptance has been completed and is in substantially the form of Exhibit
C, (i) accept such Assignment and Acceptance, (ii) record the information
contained therein in the Register and (iii) give prompt notice thereof to the
Borrowers. In the case of any assignment by a Lender, within five Business
Days after its receipt of such notice, the Borrowers, at their own expense,
shall execute and deliver to the Administrative Agent in exchange for the
surrendered Note or Notes a new Note to the order of such Eligible Assignee in
an amount equal to the Revolving Commitment or Term Commitment, as the case
may be, assumed by it pursuant to such Assignment and Acceptance and, if any
assigning Lender has retained a Revolving Commitment or Term Commitment, as
the case may be, hereunder, a new Note to the order of such assigning Lender
in an amount equal to the Revolving Commitment or Term Commitment, as the case
may be, retained by it hereunder. Such new Note or Notes shall be in an
aggregate principal amount equal to the aggregate principal amount of such
surrendered Note or Notes, shall be dated the effective date of such
Assignment and Acceptance and shall otherwise be in substantially the form of
Exhibit A-1 or Exhibit A-2, as applicable.
(g) Each Lender Party may sell participations to one or more Persons
(other than any Borrower or any Affiliate of any Borrower) in or to all or a
portion of its rights and obligations under this Agreement (including (i) all
or a portion of its Revolving Commitment, the Revolving Advances owing to it,
L/C Credit Extensions and the Revolving Note or Revolving Notes (if any) held
by it, and/or (ii) all or a portion of its Term Commitment, the Term Advances
owing to it, and the Term Note or Term Notes (if any) held by it); provided,
however, that (i) such Lender Party's obligations under this Agreement
(including its Revolving Commitment and L/C Credit Extensions or Term
Commitment, as the case may be) shall remain unchanged, (ii) such Lender Party
shall remain solely responsible to the other parties hereto for the
performance of such obligations, (iii) such Lender Party shall remain the
holder of any such Note for all purposes of this Agreement, (iv) the
Borrowers, the Administrative Agent and the other Lender Parties shall
continue to deal solely and directly with such Lender Party in connection with
such Lender Party's rights and obligations under this Agreement and (v) no
participant under any such participation shall have any right to approve any
amendment or waiver of any provision of any Loan Document, or any consent to
any departure by any Borrower therefrom, except to the extent that such
amendment, waiver or consent would reduce the principal of, or interest on,
the Notes or any fees or other amounts payable hereunder, in each case to the
extent subject to such participation, postpone any date fixed for any payment
of
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principal of, or interest on, the Notes or any fees or other amounts
payable hereunder, in each case to the extent subject to such participation.
(h) Notwithstanding anything in this Agreement to the contrary
(including any other provision regarding assignments, participations,
transfers or novations), any Lender (a "Granting Lender") may, without the
consent of any other party hereto, grant to a special purpose vehicle (whether
a corporation, partnership, limited liability company, trust or otherwise, an
"SPV") sponsored or managed by the Granting Lender or any Affiliate thereof, a
participation in all or any part of any Advance (including the Commitment
therefor) that such Granting Lender has made or will make pursuant to this
Agreement; provided that (i) such Granting Lender's obligations under this
Agreement (including its Commitment) shall remain unchanged; (ii) such
Granting Lender shall remain the holder of its Note for all purposes under
this Agreement; and (iii) the Borrowers, the Administrative Agent and the
other Lenders shall continue to deal solely and directly with such Granting
Lender in connection with such Granting Lender's rights and obligations under
the Loan Documents. Each party hereto hereby agrees that (A) no SPV will be
entitled to any rights or benefits that a Lender would not otherwise be
entitled to under this Agreement or any other Loan Document; and (B) an SPV
may assign its interest in any Advance under this Agreement to any Person that
would constitute a Lender subject to the satisfaction of all requirements for
an assignment by any Lender set forth in this Section 8.07. Notwithstanding
anything in this Agreement to the contrary, the Granting Lender and any SPV
may, without the consent of any other party to this Agreement, and without
limiting any other rights of disclosure of the Granting Lender under this
Agreement, disclose on a confidential basis any non-public information
relating to its funding of its Advances to (1) (in the case of the Granting
Lender) any actual or prospective SPV, (2) (in the case of an SPV) its
lenders, sureties, reinsurers, guarantors or credit liquidity enhancers, (3)
their respective directors, officers, and advisors, and (4) any rating agency.
(i) Any Lender Party may, in connection with any assignment or
participation or proposed assignment or participation pursuant to this Section
8.07, disclose to the assignee or participant or proposed assignee or
participant any information relating to any Borrower furnished to such Lender
Party by or on behalf of such Borrower, subject to the requirements set forth
in Section 8.12.
(j) Notwithstanding any other provision set forth in this Agreement, any
Lender Party may at any time pledge or assign a security interest in all or
any portion of its rights under this Agreement (including the Advances owing
to it and the Note or Notes held by it) to secure the obligations of such
Lender Party, including any pledge or assignment to secure obligations to a
Federal Reserve Bank; provided that no such pledge or assignment shall release
such Lender Party from any of its obligations hereunder or substitute any such
pledgee or assignee for such Lender Party as a party hereto.
SECTION 8.08. Execution in Counterparts. This Agreement may be executed
in any number of counterparts and by different parties hereto in separate
counterparts, each of which when so executed shall be deemed to be an original
and all of which taken together shall constitute one and the same agreement.
Delivery of an executed counterpart of a signature page to this Agreement by
telecopier shall be effective as delivery of an original executed counterpart
of this Agreement.
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SECTION 8.09. Jurisdiction, Etc. (a) Each of the parties hereto hereby
irrevocably and unconditionally submits, for itself and its property, to the
non-exclusive jurisdiction of any New York State court or Federal court of the
United States of America sitting in New York City, and any appellate court
from any thereof, in any action or proceeding arising out of or relating to
this Agreement or any of the other Loan Documents to which it is a party, or
for recognition or enforcement of any judgment, and each of the parties hereto
hereby irrevocably and unconditionally agrees that all claims in respect of
any such action or proceeding may be heard and determined in any such New York
State court or, to the fullest extent permitted by law, in such Federal court.
Each of the parties hereto agrees that a final judgment in any such action or
proceeding shall be conclusive and may be enforced in other jurisdictions by
suit on the judgment or in any other manner provided by law. Nothing in this
Agreement shall affect any right that any party may otherwise have to bring
any action or proceeding relating to this Agreement or any of the other Loan
Documents in the courts of any jurisdiction.
(b) Each of the parties hereto irrevocably and unconditionally waives,
to the fullest extent it may legally and effectively do so, any objection that
it may now or hereafter have to the laying of venue of any suit, action or
proceeding arising out of or relating to this Agreement or any of the other
Loan Documents to which it is a party in any New York State or Federal court.
Each of the parties hereto hereby irrevocably waives, to the fullest extent
permitted by law, the defense of an inconvenient forum to the maintenance of
such action or proceeding in any such court.
SECTION 8.10. Governing Law. This Agreement and the Notes shall be
governed by, and construed in accordance with, the laws of the State of New
York.
SECTION 8.11. Waiver of Jury Trial. Each Borrower, the Administrative
Agent and the Lender Parties irrevocably waives all right to trial by jury in
any action, proceeding or counterclaim (whether based on contract, tort or
otherwise) arising out of or relating to any of the Loan Documents, the
Advances, any Letter of Credit or the actions of the Administrative Agent or
any Lender Party in the negotiation, administration, performance or
enforcement thereof.
SECTION 8.12. Confidentiality. (a) Neither the Administrative Agent, any
Arranger Party nor any Lender Party may, without the prior written consent of
AYE, disclose to any Person (i) any confidential, proprietary or non-public
information of the Borrowers furnished to the Administrative Agent, the
Arranger Parties or the Lender Parties by the Borrowers (such information
being referred to collectively herein as the "Confidential Information") or
(ii) the fact that the Confidential Information has been made available or any
of the terms, conditions or other facts with respect to the Confidential
Information, in each case except as permitted by Section 8.07 or this Section
8.12 and except that the Administrative Agent, each of the Arranger Parties
and each of the Lender Parties may disclose Confidential Information (i) to
its and its Affiliates' employees, officers, directors, agents and advisors
(collectively, "Representatives") who need to know the Confidential
Information for the purpose of administering or enforcing its rights under
this Agreement and the other Loan Documents and the transactions contemplated
hereby and thereby or for the discharge of their duties (it being understood
that the Representatives to whom such disclosure is made will be informed of
the confidential nature of such Confidential Information and instructed to
keep such Confidential Information confidential on substantially the same
terms as provided herein), (ii) to the extent requested by any regulatory
106
authority having jurisdiction over it or to the extent necessary for purposes
of enforcing this Agreement or any other Loan Document, (iii) to the extent
required by applicable laws or regulations or by any subpoena or similar legal
process, (iv) to any other party to this Agreement, (v) in connection with the
exercise of any remedies hereunder or under any other Loan Document or any
suit, action or proceeding relating to this Agreement or any other Loan
Document or the enforcement of rights hereunder or thereunder, (vi) subject to
an agreement containing provisions substantially the same as those of this
Section 8.12, to any assignee or pledgee of or participant in, or any
prospective assignee or pledgee of or participant in, any of its rights or
obligations under this Agreement (including any funding vehicle organized to
undertake or effectuate such securitization, collateralization or other
transaction, its lenders, sureties, reinsurers, swap counterparties,
guarantors or credit liquidity enhancers, their respective directors,
officers, and advisors, and any rating agency), so long as the Persons to whom
such disclosure is made will be informed of the confidential nature of such
Confidential Information and such Persons have agreed in writing (or with
respect to any rating agency, in writing or otherwise) to keep such
Confidential Information confidential on substantially the same terms as
provided herein, (vii) to the extent such Confidential Information (A) is or
becomes generally available to the public on a non-confidential basis other
than as a result of a breach of this Section 8.12 by the Administrative Agent,
such Arranger Party or such Lender Party, or (B) is or becomes available to
the Administrative Agent, such Arranger Party or such Lender Party on a
nonconfidential basis from a source other than a Borrower and (viii) with the
consent of AYE.
(b) Neither the Administrative Agent, any Arranger Party nor any Lender
Party shall, without the prior written consent of AYE, use, either directly or
indirectly, any of the Confidential Information except in connection with this
Agreement and the other Loan Documents and the transactions contemplated
hereby and thereby.
(c) Notwithstanding the foregoing, any of the parties hereto may
disclose to any and all Persons, without limitation of any kind, the U.S. tax
treatment and U.S. tax structure of the transactions contemplated by this
Agreement and the other Loan Documents and all materials of any kind
(including opinions or other tax analyses) that are provided to such parties
relating to such U.S. tax treatment and U.S. tax structure.
(d) In the event that the Administrative Agent, any Arranger Party or
any Lender Party becomes legally compelled to disclose any of the Confidential
Information otherwise than as contemplated by Section 8.12(a), the
Administrative Agent, such Arranger Party or such Lender Party shall provide
AYE with notice of such event promptly upon its obtaining knowledge thereof
(provided that it is not otherwise prohibited by Applicable Law from giving
such notice) so that AYE may seek a protective order or other appropriate
remedy. In the event that such protective order or other remedy is not
obtained, the Administrative Agent, such Arranger Party or such Lender Party
shall furnish only that portion of the Confidential Information that it is
legally required to furnish and shall cooperate with AYE's counsel to enable
AYE to obtain a protective order or other reliable assurance that confidential
treatment will be accorded the Confidential Information.
(e) In the event of any breach of this Section 8.12, AYE shall be
entitled to equitable relief (including injunction and specific performance)
in addition to all other remedies available to it at law or in equity.
107
(f) Neither the Administrative Agent, any Arranger Party nor any Lender
Party shall make any public announcement, advertisement, statement or
communication regarding any Borrower, its Affiliates (insofar as such
announcement, advertisement, statement or communication relates to such
Borrower or the transactions contemplated hereby) or this Agreement or the
transactions contemplated hereby without the prior consent of AYE (such
consent not to be unreasonably withheld or delayed).
(g) The obligations of the Administrative Agent, each Arranger Party and
each Lender under this Section 8.12 shall survive for a period of one year
following the termination or expiration of this Agreement.
SECTION 8.13. Benefits of Agreement. Nothing in this Agreement or any
other Loan Document, express or implied, shall give to any Person, other than
the parties hereto, each Indemnified Party and each of their successors and
permitted assigns under this Agreement or any other Loan Document, any benefit
or any legal or equitable right or remedy under this Agreement; provided that
each Indemnified Party and its successors and assigns shall not have any
benefit or any legal or equitable right or remedy under this Agreement other
than as provided by Section 8.04(b).
SECTION 8.14. Severability. If any provision of this Agreement shall be
invalid, illegal or unenforceable, then to the extent permitted by law, the
validity, legality and enforceability of the remaining provisions shall not in
any way be affected or impaired thereby.
SECTION 8.15. Limitations. (a) The obligations, liabilities or
responsibilities of any party hereunder shall be limited to those obligations,
liabilities or responsibilities expressly set forth and attributed to such
party pursuant to this Agreement or otherwise applicable under Applicable Law.
(b) In no event shall any Indemnified Party be liable for, and each
Borrower hereby agrees not to assert any claim against any Indemnified Party,
on any theory of liability, for consequential, incidental, indirect, punitive
or special damages arising out of or otherwise relating to the Notes, this
Agreement, the other Loan Documents, any of the transactions contemplated
herein or therein or the actual or proposed use of the proceeds of the
Advances or L/C Credit Extensions.
SECTION 8.16. Survival. (a) Without prejudice to any agreement of any
Borrower hereunder or under any other Loan Document, the indemnification and
expense reimbursement obligations of such Borrower contained in the Existing
Credit Agreement shall survive the Closing Date and the payment in full of
principal, interest and all other amounts payable thereunder.
(b) Notwithstanding anything in this Agreement to the contrary, Sections
2.08(c), 7.05, 7.10, 8.04, 8.10, 8.11, 8.12 and 8.16 shall survive any
termination of this Agreement. In addition, each representation and warranty
made or deemed to be made hereunder shall survive the making of such
representation and warranty, and no Lender Party shall be deemed to have
waived, by reason of making any Advance or making any payment pursuant
thereto, any Default that may arise by reason of such representation or
warranty proving
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to have been false or misleading, notwithstanding that such Lender Party may
have had notice or knowledge or reason to believe that such representation or
warranty was false or misleading at the time such Advance or L/C Credit
Extension was made.
SECTION 8.17. USA Patriot Act Notice. Each Lender Party and the
Administrative Agent (for itself and not on behalf of any Lender Party) hereby
notifies each Borrower that pursuant to the requirements of the USA Patriot
Act (Title III of Pub. L. 107-56 (signed into law October 26, 2001)) (the
"Act"), it is required to obtain, verify and record information that
identifies such Borrower, which information includes the name and address of
such Borrower and other information that will allow such Lender Party or the
Administrative Agent, as applicable, to identify such Borrower in accordance
with the Act.
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IN WITNESS WHEREOF, the parties hereto have caused this Agreement to be
executed by their respective officers thereunto duly authorized, as of the
date first above written.
ALLEGHENY ENERGY, INC.,
as Borrower
By
---------------------------------
Name:
Title:
ALLEGHENY ENERGY SUPPLY COMPANY, LLC,
as Borrower
By
---------------------------------
Name:
Title:
CITICORP NORTH AMERICA, INC.,
as Administrative Agent
By
---------------------------------
Name:
Title:
CITICORP NORTH AMERICA, INC.,
as Initial Lender
By
---------------------------------
Name:
Title:
THE BANK OF NOVA SCOTIA,
as Initial Lender
By
---------------------------------
Name:
Title:
BANK OF AMERICA, N.A.,
as Initial Lender
By
---------------------------------
Name:
Title:
CREDIT SUISSE, CAYMAN ISLANDS BRANCH,
as Initial Lender
By
---------------------------------
Name:
Title:
XX XXXXXX XXXXX BANK, N.A.,
as Initial Lender
By
---------------------------------
Name:
Title:
[--------------------------------],
as Initial Lender
By
---------------------------------
Name:
Title:
