Exhibit 10(c)
EXECUTION COPY
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TXU US HOLDINGS COMPANY,
as Borrower
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TXU CORP.,
as Exiting Borrower
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$400,000,000 THREE-YEAR
AMENDED AND RESTATED
REVOLVING CREDIT AGREEMENT
Dated as of April 22, 2003
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CITIBANK, N.A.,
as Administrative Agent
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CITIGROUP GLOBAL MARKETS, INC.
Lead Arranger
BANC OF AMERICA SECURITIES, LLC
and
CREDIT SUISSE FIRST BOSTON
Syndication Agent
COMMERZBANK AG, NEW YORK AND CAYMAN ISLANDS BRANCHES
2
SUMITOMO MITSUI BANKING CORPORATION
Co-Documentation Agents
TABLE OF CONTENTS
Section Page
Article I DEFINITIONS; CONSTRUCTION
SECTION 1.01. Defined Terms.....................................................................................1
SECTION 1.02. Terms Generally..................................................................................14
Article II THE CREDITS
SECTION 2.01. Commitments......................................................................................15
SECTION 2.02. Loans............................................................................................15
SECTION 2.03. Borrowing Procedure..............................................................................16
SECTION 2.04. Fees.............................................................................................17
SECTION 2.05. Repayment of Loans; Evidence of Indebtedness.....................................................17
SECTION 2.06. Interest on Loans................................................................................18
SECTION 2.07. Default Interest.................................................................................18
SECTION 2.08. Alternate Rate of Interest.......................................................................18
SECTION 2.09. Termination and Reduction of Commitments.........................................................19
SECTION 2.10. Prepayment.......................................................................................19
SECTION 2.11. Reserve Requirements; Change in Circumstances....................................................20
SECTION 2.12. Change in Legality...............................................................................21
SECTION 2.13. Pro Rata Treatment...............................................................................22
SECTION 2.14. Sharing of Setoffs...............................................................................22
SECTION 2.15. Payments.........................................................................................23
SECTION 2.16. Taxes............................................................................................23
SECTION 2.17. Assignment of Commitments Under Certain Circumstances............................................26
Article III REPRESENTATIONS AND WARRANTIES
SECTION 3.01. Organization; Powers.............................................................................26
SECTION 3.02. Authorization....................................................................................26
SECTION 3.03. Enforceability...................................................................................27
SECTION 3.04. Governmental Approvals...........................................................................27
SECTION 3.05. Financial Statements.............................................................................27
SECTION 3.06. Litigation.......................................................................................27
SECTION 3.07. Federal Reserve Regulations......................................................................28
SECTION 3.08. Investment Company Act; Public Utility Holding Company Act.......................................28
SECTION 3.09. No Material Misstatements........................................................................28
SECTION 3.10. Taxes............................................................................................28
SECTION 3.11. Employee Benefit Plans...........................................................................28
SECTION 3.12. Significant Subsidiaries.........................................................................29
SECTION 3.13. Environmental Matters............................................................................29
SECTION 3.14. Solvency.........................................................................................30
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Article IV CONDITIONS
SECTION 4.01. Restatement Date.................................................................................30
SECTION 4.02. Conditions for All Loans.........................................................................31
Article V COVENANTS
SECTION 5.01. Existence........................................................................................32
SECTION 5.02. Compliance With Laws; Business and Properties....................................................32
SECTION 5.03. Financial Statements, Reports, Etc...............................................................32
SECTION 5.04. Insurance........................................................................................34
SECTION 5.05. Taxes, Etc.......................................................................................34
SECTION 5.06. Maintaining Records; Access to Properties and Inspections........................................34
SECTION 5.07. ERISA............................................................................................34
SECTION 5.08. Use of Proceeds..................................................................................34
SECTION 5.09. Consolidations, Mergers, Sales and Acquisitions of Assets and Investments in Subsidiaries........34
SECTION 5.10. Limitations on Liens.............................................................................35
SECTION 5.11. Fixed Charge Coverage............................................................................37
SECTION 5.12. Equity Capitalization Ratio......................................................................37
SECTION 5.13. Restrictive Agreements...........................................................................37
Article VI EVENTS OF DEFAULT
Article VII THE AGENT
Article VIII MISCELLANEOUS
SECTION 8.01. Notices..........................................................................................42
SECTION 8.02. Survival of Agreement............................................................................42
SECTION 8.03. Binding Effect...................................................................................43
SECTION 8.04. Successors and Assigns...........................................................................43
SECTION 8.05. Expenses; Indemnity..............................................................................45
SECTION 8.06. Right of Setoff..................................................................................47
SECTION 8.07. Applicable Law...................................................................................47
SECTION 8.08. Waivers; Amendment...............................................................................47
SECTION 8.09. Entire Agreement.................................................................................48
SECTION 8.10. Severability.....................................................................................48
SECTION 8.11. Counterparts.....................................................................................48
SECTION 8.12. Headings.........................................................................................48
SECTION 8.13. Interest Rate Limitation.........................................................................48
SECTION 8.14. Jurisdiction; Venue..............................................................................49
SECTION 8.15. Confidentiality..................................................................................49
SECTION 8.16. Assignment, Assumption and Release...............................................................50
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EXHIBITS AND SCHEDULES
Exhibit A - Form of Borrowing Request
Exhibit B - Form of Assignment and Acceptance
Schedule 2.01 - Commitments
Schedule 5.13 - Restrictive Agreements
THREE-YEAR AMENDED AND RESTATED REVOLVING CREDIT AGREEMENT
(the "Agreement"), dated as of April 22, 2003, among TXU US
Holdings Company, a Texas corporation (the "Borrower"); TXU
Corp. ("TXU", and, in its capacity as the borrower under the
Original Agreement (as defined below), the "Exiting
Borrower"); the lenders listed in Schedule 2.01 (together with
their successors and assigns, the "Lenders"); and Citibank,
N.A. ("Citibank"), as administrative agent for the Lenders (in
such capacity, the "Agent").
Pursuant to the terms of the Three Year Revolving Credit Agreement,
dated as of May 1, 2002, as amended as of October 13, 2002 (as amended, the
"Original Agreement"), among the Exiting Borrower, the lenders party thereto
(the "Original Lenders") and Citibank, as administrative agent for the Original
Lenders, the Original Lenders agreed to extend credit to the Exiting Borrower in
an aggregate principal amount at any time outstanding not in excess of
$500,000,000. The parties hereto wish to replace the Exiting Borrower as the
borrower under the Original Agreement with the "Borrower" named above and to
make certain other amendments to the Original Agreement.
Accordingly, in order to reflect the foregoing, the parties hereto now
wish to amend and restate the Original Agreement as herein set forth.
Accordingly, the parties hereto agree as follows:
Article I
DEFINITIONS; CONSTRUCTION
SECTION 1.01. Defined Terms.
As used in this Agreement, the following terms shall have the meanings
specified below:
"ABR Borrowing" shall mean a Borrowing comprised of ABR Loans.
"ABR Loan" shall mean any Loan bearing interest at a rate
determined by reference to the Alternate Base Rate in accordance with
the provisions of Article II or any Eurodollar Loan converted (pursuant
to Section 2.08 or 2.12(a)(ii)) to a loan bearing interest at a rate
determined by reference to the Alternate Base Rate.
"Acquisition Date" shall mean the date as of which a person or
group of related persons first acquires more than 30% of any
outstanding class of Voting Shares of TXU (within the meaning of
Section 13(d) or 14(d) of the Exchange Act and the applicable rules and
regulations thereunder).
"Administrative Fees" shall have the meaning assigned to such
term in Section 2.04(b).
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"Affiliate" shall mean, when used with respect to a specified
person, another person that directly or indirectly controls or is
controlled by or is under common control with the person specified.
"Agent" shall have the meaning given such term in the preamble
hereto.
"Agreement" shall have the meaning given such term in the
preamble hereto.
"Alternate Base Rate" shall mean, for any day, a rate per
annum (rounded upwards, if necessary, to the next 1/16 of 1%) equal to
the greater of (i) the Federal Funds Effective Rate in effect on such
day plus 1/2 of 1% and (ii) the Prime Rate in effect on such day. For
purposes hereof, "Prime Rate" shall mean the rate of interest per annum
publicly announced from time to time by the Agent as its "base" rate in
effect at its principal office in New York City; each change in the
Prime Rate shall be effective on the date such change is publicly
announced as effective; and "Federal Funds Effective Rate" shall mean,
for any day, the weighted average of the rates on overnight Federal
funds transactions with members of the Federal Reserve System arranged
by Federal funds brokers, as released on the next succeeding Business
Day by the Federal Reserve Bank of New York, or, if such rate is not so
released for any day which is a Business Day, the arithmetic average
(rounded upwards to the next 1/100th of 1%), as determined by the
Agent, of the quotations for the day of such transactions received by
the Agent from three Federal funds brokers of recognized standing
selected by it. If for any reason the Agent shall have determined
(which determination shall be conclusive absent manifest error;
provided that the Agent shall, upon request, provide to the Borrower a
certificate setting forth in reasonable detail the basis for such
determination) that it is unable to ascertain the Federal Funds
Effective Rate for any reason, including the inability of the Agent to
obtain sufficient quotations in accordance with the terms thereof, the
Alternate Base Rate shall be determined without regard to clause (i) of
the first sentence of this definition until the circumstances giving
rise to such inability no longer exist. Any change in the Alternate
Base Rate due to a change in the Prime Rate or the Federal Funds
Effective Rate shall be effective on the effective date of such change
in the Prime Rate or the Federal Funds Effective Rate, respectively.
"Applicable Margin" shall mean the percentage per annum set
forth in the column identified as ▇▇▇▇▇ ▇, ▇▇▇▇▇ ▇, ▇▇▇▇▇ ▇ or Level 4
below, based upon the level corresponding to the Debt Rating of the
Borrower at the time of determination. If there is a difference of one
level in the Debt Ratings, then the higher Debt Rating shall be used to
determine the Applicable Margin; if there is a difference of more than
one level in the Debt Ratings, then the level one level higher than the
lower Debt Rating shall be used to determine the Applicable Margin,
unless the lower Debt Rating is below Level 2, in which case the lower
Debt Rating will be used to determine the Applicable Margin. The
Applicable Margins set forth below with respect to each Level (i) shall
be increased by 0.25% during any period (and for only such period) in
which the aggregate principal amount of Loans outstanding is greater
than 33?% but less than 66?% of the Total Commitment, or (ii) shall be
increased by 0.50% during any period (and for only such period) in
which the aggregate principal amount of Loans outstanding is at least
3
66?% of the Total Commitment. Any change in the Applicable Margin shall
be effective on the date on which the applicable rating agency
announces any change in the Debt Rating.
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Level 1 Level 2 ▇▇▇▇▇ ▇ ▇▇▇▇▇ ▇
------- ------- ------- -------
S&P BBB+ or better BBB or BBB- BB+ Lower than BB+*
▇▇▇▇▇'▇ Baa1 or better Baa2 or ▇▇▇▇ ▇▇▇ Lower than Ba1*
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Percentage Per Annum
----------------- ------------------ ------------------- ----------------- ------------------
Eurodollar 1.25% 1.45% 1.75% 2.25%
Margin
----------------- ------------------ ------------------- ----------------- ------------------
ABR 0.25% 0.45% 0.75% 1.25%
Margin
================= ================== =================== ================= ==================
*or unrated
"Assignment and Acceptance" shall mean an assignment and
acceptance entered into by a Lender and an assignee in the form of
Exhibit B.
"Board" shall mean the Board of Governors of the Federal
Reserve System of the United States.
"Borrower" shall have the meaning given such term in the
preamble hereto.
"Borrowing" shall mean a group of Loans of a single Type made
by the Lenders on a single date and as to which a single Interest
Period is in effect.
"Borrowing Request" shall mean a request made pursuant to
Section 2.03 in the form of Exhibit A.
"Business Day" shall mean any day (other than a day that is a
Saturday, Sunday or legal holiday in the State of New York) on which
banks are open for business in New York City; provided, however, that,
when used in connection with a Eurodollar Loan, the term "Business Day"
shall also exclude any day on which banks are not open for dealings in
dollar deposits in the London interbank market.
"A Change in Control" shall be deemed to have occurred if (i)
any person or "group" (within the meaning of Section 13(d) or 14(d) of
the Exchange Act) shall acquire beneficial ownership of more than 30%
of any outstanding class of Voting Shares of TXU unless such
acquisition shall have been approved prior to such acquisition date by
a majority of Disinterested Directors of TXU or (ii) during any period
of 12 consecutive months, a majority of the members of the board of
directors of TXU cease to be composed of individuals (A) who were
members of the board of directors of TXU on the first day of such
period, (B) whose election or nomination to the board of directors of
TXU was approved by individuals referred to in clause (i) above
constituting at the time of such election or nomination at least a
majority of the board of directors of TXU or (C) whose election or
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nomination to the board of directors of TXU was approved by individuals
referred to in clauses (i) and (ii) above constituting at the time of
such election or nomination at least a majority of the board of
directors of TXU.
"Citibank" shall have the meaning given to such term in the
preamble hereto.
"Code" shall mean the Internal Revenue Code of 1986, as the
same may be amended from time to time.
"Commission" shall mean the Public Utility Commission of the
State of Texas.
"Commitment" shall mean, with respect to each Lender, the
commitment of such Lender set forth in Schedule 2.01 hereto to make
Loans, as such Commitment may be permanently terminated or reduced from
time to time pursuant to Section 2.09 or modified from time to time
pursuant to Section 8.04. The Commitment of each Lender shall
automatically and permanently terminate on the Maturity Date if not
terminated earlier pursuant to the terms hereof.
"Consolidated Earnings Available for Fixed Charges" for any
twelve-month period shall mean (i) consolidated net income, calculated
after deducting preferred stock dividends and preferred securities
distributions of Subsidiaries, but before any extraordinary items and
before the effect in such twelve-month period of any change in
accounting principles promulgated by the Financial Accounting Standards
Board becoming effective after December 31, 2001, less (ii) allowances
for equity funds used during construction to the extent that such
allowances, taken as a whole, increased such consolidated net income,
plus (iii) provisions for Federal income taxes, to the extent that such
provisions, taken as a whole, decreased such consolidated net income,
plus (iv) Consolidated Fixed Charges, all determined for such
twelve-month period with respect to the Borrower and its Consolidated
Subsidiaries on a consolidated basis; provided, however, that in
computing Consolidated Earnings Available for Fixed Charges for any
twelve-month period the following amounts shall be excluded to the
extent otherwise included pursuant to the foregoing: (A) the effect of
any regulatory disallowances resolving fuel or other issues in any
proceeding before the Commission or the Railroad Commission of Texas in
an aggregate amount not to exceed $100,000,000, (B) any non-cash book
losses relating to the sale or write-down of assets, (C) one-time costs
of up to $100,000,000 incurred in connection with the restructuring of
certain Subsidiaries of TXU in connection with the 1999 Texas electric
industry restructuring legislation (as described in TXU's filings with
the SEC) and (D) up to $100,000,000 of costs incurred in connection
with write-offs relating to the regulatory settlement plan, which was
approved by the Commission in June of 2002, of the Borrower and certain
of its Subsidiaries (as described in TXU's filings with the SEC) and
became final upon resolution of outstanding appeals in January of 2003.
"Consolidated Fixed Charges" for any twelve-month period shall
mean the sum (without duplication) of (i) interest on mortgage bonds,
(ii) interest on other long-term debt, (iii) other interest expense,
including interest on short-term debt and the current portion of
long-term debt, and (iv) preferred stock dividends and preferred
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securities distributions of Subsidiaries, all determined for such
twelve-month period with respect to the Borrower and its Consolidated
Subsidiaries on a consolidated basis. For purposes of such calculation,
long-term debt shall not include the principal amount of, or interest
on, Qualified Transition Bonds.
"Consolidated Shareholders' Equity" shall mean the sum
(without duplication) of (i) total common stock equity plus (ii)
preferred stock not subject to mandatory redemption, each (in the case
of clauses (i) and (ii)) determined with respect to the Borrower and
its Consolidated Subsidiaries on a consolidated basis, plus (iii)
Equity-Credit Preferred Securities in an aggregate liquidation
preference amount not in excess of $1,750,000,000.
"Consolidated Subsidiary" of a person shall mean at any date
any Subsidiary or other entity the accounts of which would be
consolidated with those of such person in its consolidated financial
statements as of such date.
"Consolidated Total Capitalization" shall mean the sum of (i)
total common stock equity, (ii) preferred stock and preferred
securities, (iii) long-term debt (less amounts due currently) and (iv)
short-term debt consisting of commercial paper, notes payable to
unaffiliated entities and long-term debt due currently to the extent
such short-term debt exceeds $2,000,000,000, determined with respect to
the Borrower and its Consolidated Subsidiaries on a consolidated basis.
For purposes of such calculation, long-term debt shall not include the
principal amount of, or interest on, Qualified Transition Bonds.
"Controlled Group" shall mean all members of a controlled
group of corporations and all trades or businesses (whether or not
incorporated) under common control that, together with the Borrower,
are treated as a single employer under Section 414(b) or 414(c) of the
Code.
"Credit Lyonnais Facility" shall mean the $45,000,000
Revolving Credit Agreement, dated as of the date hereof, among TXU, as
borrower, the lenders party thereto and Credit Lyonnais New York
Branch, as agent.
"Credit Lyonnais Facility Ratable Percentage" means, with
respect to the aggregate principal amount of any reduction in the
Credit Lyonnais Facility Total Commitment, the percentage of the Credit
Lyonnais Facility Total Commitment represented by the aggregate
principal amount of such reduction.
"Credit Lyonnais Facility Total Commitment" means the "Total
Commitment" under the Credit Lyonnais Facility.
"Debt Rating" shall mean the ratings (whether explicit or
implied) assigned by S&P and ▇▇▇▇▇'▇ to the Borrower's senior unsecured
non-credit enhanced long term debt.
"Default" shall mean any event or condition that upon notice,
lapse of time or both would constitute an Event of Default.
6
"Disinterested Director" shall mean any member of the board of
directors of TXU who is not affiliated, directly or indirectly, with,
or appointed by, a person or group of related persons (other than TXU,
any Subsidiary of TXU, or any pension, savings or other employee
benefit plan for the benefit of employees of TXU and/or any Subsidiary
of TXU) acquiring the beneficial ownership of more than 30% of any
outstanding class of Voting Shares of TXU (within the meaning of
Section 13(d) or 14(d) of the Exchange Act, and the applicable rules
and regulations thereunder) and who either was a member of the board of
directors of TXU prior to the Acquisition Date or was recommended for
election by a majority of the Disinterested Directors in office prior
to the Acquisition Date.
"dollars" or "$" shall mean lawful money of the United States
of America.
"Energy" shall mean TXU Energy Company LLC, a Delaware limited
liability company.
"Equity-Credit Preferred Securities" shall mean securities,
however denominated, (i) issued by the Borrower or a Consolidated
Subsidiary of the Borrower, (ii) that are not subject to mandatory
redemption or the underlying securities, if any, of which are not
subject to mandatory redemption, (iii) that are perpetual or mature no
less than 30 years from the date of issuance, (iv) the indebtedness
issued in connection with which, including any guaranty, is subordinate
in right of payment to the unsecured and unsubordinated indebtedness of
the issuer of such indebtedness or guaranty, and (v) the terms of which
permit the deferral of the payment of interest or distributions thereon
to a date occurring after the Maturity Date.
"ERISA" shall mean the Employee Retirement Income Security Act
of 1974, as the same may be amended from time to time.
"ERISA Affiliate" shall mean any trade or business (whether or
not incorporated) that is a member of a group of (i) organizations
described in Section 414(b) or (c) of the Code and (ii) solely for
purposes of the Lien created under Section 412(n) of the Code,
organizations described in Section 414(m) or (o) of the Code of which
the Borrower is a member.
"ERISA Event" shall mean (i) any "Reportable Event"; (ii) the
adoption of any amendment to a Plan that would require the provision of
security pursuant to Section 401(a)(29) of the Code or Section 307 of
ERISA; (iii) the incurrence of any liability under Title IV of ERISA
with respect to the termination of any Plan or the withdrawal or
partial withdrawal of the Borrower or any of its ERISA Affiliates from
any Plan or Multiemployer Plan; (iv) the receipt by the Borrower or any
ERISA Affiliate from the PBGC of any notice relating to the intention
to terminate any Plan or Plans or to appoint a trustee to administer
any Plan; (v) the receipt by the Borrower or any ERISA Affiliate of any
notice concerning the imposition of Withdrawal Liability or a
determination that a Multiemployer Plan is, or is expected to be,
insolvent or in reorganization, within the meaning of Title IV of
ERISA; (vi) the occurrence of a "prohibited transaction" with respect
to which the Borrower or any of its subsidiaries is liable; and (vii)
any other similar event or condition with respect to a Plan or
Multiemployer Plan that could result in liability of the Borrower other
than a liability to pay premiums or benefits when due.
7
"Eurodollar Borrowing" shall mean a Borrowing comprised of
Eurodollar Loans.
"Eurodollar Loan" shall mean any Loan bearing interest at a
rate determined by reference to the LIBO Rate in accordance with the
provisions of Article II.
"Event of Default" shall have the meaning assigned to such
term in Article VI.
"Exchange Act" shall mean the Securities Exchange Act of 1934,
as amended.
"Exiting Borrower" shall have the meaning given to such term
in the preamble hereto.
"Facility B Credit Agreement" shall mean the Five-Year Third
Amended and Restated Competitive Advance and Revolving Credit Facility
Agreement, dated as of July 31, 2002, among the Borrower and certain
other parties named therein, as amended, modified or supplemented from
time to time.
"Facility Fee" shall have the meaning assigned to such term in
Section 2.04(a).
"Facility Fee Percentage" shall mean, at any time, the
percentage per annum set forth in the column identified as ▇▇▇▇▇ ▇,
▇▇▇▇▇ ▇, ▇▇▇▇▇ ▇ or Level 4 below, based upon the level corresponding
to the Debt Rating of the Borrower at the time of determination. If
there is a difference of one level in the Debt Ratings, then the higher
Debt Rating shall be used to determine the Facility Fee Percentage; if
there is a difference of more than one level in the Debt Ratings, then
the level one level higher than the lower Debt Rating shall be used to
determine the Facility Fee Percentage, unless the lower Debt Rating is
below Level 2, in which case the lower Debt Rating will be used to
determine the Facility Fee Percentage. Any change in the Facility Fee
Percentage shall be effective on the date on which the applicable
rating agency announces any change in the applicable Debt Rating.
================== =================== ================ ================= =====================
▇▇▇▇▇ ▇ ▇▇▇▇▇ ▇ ▇▇▇▇▇ ▇ ▇▇▇▇▇ ▇
------- ------- ------- -------
S&P BBB+ or better BBB or BBB- BB+ Lower than BB+*
Moody's Baa1 or better Baa2 or ▇▇▇▇ ▇▇▇ Lower than Ba1*
-------------- ------------ --- ---------------
-----------------------------------------------------------------------------------------------
Percentage Per Annum
------------------ ------------------- ---------------- ----------------- ---------------------
Facility Fee 0.25% 0.30% 0.50% 0.75%
================== =================== ================ ================= =====================
*or unrated
"Federal Funds Effective Rate" shall have the meaning set
forth in the definition of "Alternate Base Rate".
"Fees" shall mean the Facility Fees and the Administrative
Fees.
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"Financial Officer" of any corporation shall mean the chief
financial officer, principal accounting officer, treasurer, associate
or assistant treasurer, or any responsible officer designated by one of
the foregoing persons, of such corporation.
"First Mortgage" shall mean (i) the Oncor Mortgage, (ii) any
mortgage and deed of trust entered into by Oncor in order to refund or
replace, or in substitution for, the Oncor Mortgage, and (iii) if and
for so long as any first mortgage bonds are issued and outstanding
under the Oncor Mortgage, any other indenture or instrument of Oncor
pursuant to which Oncor issues debt securities secured directly or
indirectly by (A) the Lien created by the Oncor Mortgage and/or (B) any
property of Oncor.
"GAAP" shall mean generally accepted accounting principles,
applied on a consistent basis.
"Governmental Authority" shall mean any Federal, state, local
or foreign court or governmental agency, authority, instrumentality or
regulatory body.
"Indebtedness" of any person shall mean all indebtedness
representing money borrowed that is created, assumed, incurred or
guaranteed in any manner by such person or for which such person is
responsible or liable (whether by agreement to purchase indebtedness
of, or to supply funds to or invest in, others or otherwise).
"Interest Payment Date" shall mean, with respect to any Loan,
the last day of the Interest Period applicable thereto and, in the case
of a Eurodollar Loan with an Interest Period of more than three months'
duration, each day that would have been an Interest Payment Date for
such Loan had successive Interest Periods of three months' duration
been applicable to such Loan and, in addition, the date of any
prepayment of each Loan or conversion of such Loan to a Loan of a
different Type.
"Interest Period" shall mean (i) as to any Eurodollar
Borrowing, the period commencing on the date of such Borrowing and
ending on the numerically corresponding day (or, if there is no
numerically corresponding day, on the last day) in the calendar month
that is 1, 2, 3 or 6 months thereafter; provided that, in the case of
any Eurodollar Borrowing made during the 30-day period ending on the
Maturity Date, such period may end on the seventh or fourteenth day
thereafter, as the Borrower may elect and (ii) as to any ABR Borrowing,
the period commencing on the date of such Borrowing and ending on the
earliest of (A) the next succeeding March 31, June 30, September 30 or
December 31, (B) the Maturity Date, and (C) the date such Borrowing is
repaid or prepaid in accordance with Section 2.05 or Section 2.10;
provided, however, that if any Interest Period would end on a day other
than a Business Day, such Interest Period shall be extended to the next
succeeding Business Day unless, in the case of Eurodollar Loans only,
such next succeeding Business Day would fall in the next calendar
month, in which case such Interest Period shall end on the next
preceding Business Day. Interest shall accrue from and including the
first day of an Interest Period to but excluding the last day of such
Interest Period.
"Lenders" shall have the meaning given such term in the
preamble hereto.
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"LIBO Rate" shall mean, with respect to any Eurodollar
Borrowing for any Interest Period, the rate appearing on Page 3750 of
the Telerate Service (or on any successor or substitute page of such
service, or any successor to or substitute for such service, providing
rate quotations comparable to those currently provided on such page of
such service, as determined by the Agent from time to time for purposes
of providing quotations of interest rates applicable to dollar deposits
in the London interbank market) at approximately 11:00 a.m., London
time, two Business Days prior to the commencement of such Interest
Period as the rate for dollar deposits with a maturity comparable to
such Interest Period. In the event that such rate is not available at
such time for any reason, then the "LIBO Rate" with respect to such
Eurodollar Borrowing for such Interest Period shall be the rate at
which dollar deposits of $5,000,000 and for a maturity comparable to
such Interest Period are offered by the principal London office of the
Agent in immediately available funds in the London interbank market at
approximately 11:00 a.m. London time, two Business Days prior to the
commencement of such Interest Period.
"Lien" shall mean, with respect to any asset, any mortgage,
lien, pledge, charge, security interest or encumbrance of any kind in
respect of such asset. For the purposes of this Agreement, any person
shall be deemed to own subject to a Lien any asset that it has acquired
or holds subject to the interest of a vendor or lessor under any
conditional sale agreement, capital lease or other title retention
agreement relating to such asset.
"Loan" shall mean a revolving loan made pursuant to Section
2.03, whether made as a Eurodollar Loan or an ABR Loan.
"Margin Regulations" shall mean Regulations T, U and X of the
Board as from time to time in effect, and all official rulings and
interpretations thereunder or thereof.
"Margin Stock" shall have the meaning given such term under
Regulation U of the Board.
"Material Adverse Change" shall mean a materially adverse
change in the business, assets, operations or financial condition of
the Borrower and its Subsidiaries taken as a whole that makes the
Borrower unable to perform any of its obligations under this Agreement
or that impairs the rights of, or benefits available to, the Lenders
under this Agreement.
"Maturity Date" shall mean the earlier to occur of (i) May 1,
2005 and (ii) the date of termination or reduction in whole of the
Commitments pursuant to Section 2.09 or Article VI.
"▇▇▇▇▇▇▇ ▇▇▇▇▇ Facility" shall mean the $55,000,000 Revolving
Credit Agreement, dated as of the date hereof, among TXU, as borrower,
the lenders party thereto and ▇▇▇▇▇▇▇ ▇▇▇▇▇ Capital Corporation, as
agent.
"▇▇▇▇▇▇▇ ▇▇▇▇▇ Facility Ratable Percentage" means, with
respect to the aggregate principal amount of any reduction in the
▇▇▇▇▇▇▇ ▇▇▇▇▇ Facility Total Commitment, the percentage of the ▇▇▇▇▇▇▇
▇▇▇▇▇ Facility Total Commitment represented by the aggregate principal
amount of such reduction.
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"▇▇▇▇▇▇▇ ▇▇▇▇▇ Facility Total Commitment" means the "Total
Commitment" under the ▇▇▇▇▇▇▇ ▇▇▇▇▇ Facility.
"Moody's" shall mean ▇▇▇▇▇'▇ Investors Service, Inc.
"Multiemployer Plan" shall mean a multiemployer plan as
defined in Section 4001(a)(3) of ERISA to which the Borrower or any
ERISA Affiliate is making, or accruing an obligation to make,
contributions, or has within any of the preceding five plan years made,
or accrued an obligation to make, contributions.
"Oncor" shall mean Oncor Electric Delivery Company, a Texas
corporation.
"Oncor Mortgage" shall mean the Mortgage and Deed of Trust,
dated as of December 1, 1983, from the Borrower to Irving Trust Company
(now The Bank of New York), Trustee, as amended and supplemented from
time to time and as assumed by Oncor.
"Operating Agreements" shall mean (i) the Operating Agreement,
dated April 28, 1978, as amended by the Modification of Operating
Agreement, dated April 20, 1979, among TXU Mining and the Borrower
(formerly TXU Electric Company, successor to Dallas Power & Light
Company, Texas Electric Service Company and Texas Power & Light
Company) and Energy, TXU Energy Retail Company LP and TXU Generation
Company LP (pursuant to the Assumption Agreement, dated December 31,
2001, by and among the Borrower, Energy, TXU Energy Retail Company LP
and TXU Generation Company LP) (the "TXU Mining Operating Agreement"),
and as it may be amended from time to time, or (ii) the Operating
Agreement, dated December 15, 1976, between TXU Fuel and Dallas Power &
Light Company, Texas Electric Service Company and Texas Power & Light
Company (the "TXU Fuel Operating Agreement"), as it may be amended from
time to time, provided that no amendment of the TXU Mining Operating
Agreement or the TXU Fuel Operating Agreement shall increase the scope
of any Lien permitted under Section 5.10(j).
"Original Agreement" shall have the meaning given to such term
in the preamble hereto.
"Original Lenders" shall have the meaning given to such term
in the preamble hereto.
"PBGC" shall mean the Pension Benefit Guaranty Corporation or
any entity succeeding to any or all of its functions under ERISA.
"Permitted Encumbrances" shall mean, as to any person at any
date, any of the following:
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(a) (i) Liens for taxes, assessments or governmental charges not then
delinquent and Liens for workers' compensation awards and similar obligations
not then delinquent and undetermined Liens or charges incidental to
construction, Liens for taxes, assessments or governmental charges then
delinquent but the validity of which is being contested at the time by such
person in good faith against which an adequate reserve has been established,
with respect to which levy and execution thereon have been stayed and continue
to be stayed and that do not impair the use of the property or the operation of
such person's business, (ii) Liens incurred or created in connection with or to
secure the performance of bids, tenders, contracts (other than for the payment
of money), leases, statutory obligations, surety bonds or appeal bonds, and
mechanics' or materialmen's Liens, assessments or similar encumbrances, the
existence of which does not impair the use of the property subject thereto for
the purposes for which it was acquired, and other Liens of like nature incurred
or created in the ordinary course of business;
(b) Liens securing indebtedness, neither assumed nor guaranteed by such
person nor on which it customarily pays interest, existing upon real estate or
rights in or relating to real estate acquired by such person for any substation,
transmission line, transportation line, distribution line, right of way or
similar purpose;
(c) rights reserved to or vested in any municipality or public authority by
the terms of any right, power, franchise, grant, license or permit, or by any
provision of law, to terminate such right, power, franchise, grant, license or
permit or to purchase or recapture or to designate a purchaser of any of the
property of such person;
(d) rights reserved to or vested in others to take or receive any part of
the power, gas, oil, coal, lignite or other minerals or timber generated,
developed, manufactured or produced by, or grown on, or acquired with, any
property of such person and Liens upon the production from property of power,
gas, oil, coal, lignite or other minerals or timber, and the by-products and
proceeds thereof, to secure the obligations to pay all or a part of the expenses
of exploration, drilling, mining or development of such property only out of
such production or proceeds;
(e) easements, restrictions, exceptions or reservations in any property
and/or rights of way of such person for the purpose of roads, pipe lines,
substations, transmission lines, transportation lines, distribution lines,
removal of oil, gas, lignite, coal or other minerals or timber, and other like
purposes, or for the joint or common use of real property, rights of way,
facilities and/or equipment, and defects, irregularities and deficiencies in
titles of any property and/or rights of way, which do not materially impair the
use of such property and/or rights of way for the purposes for which such
property and/or rights of way are held by such person;
(f) rights reserved to or vested in any municipality or public authority to
use, control or regulate any property of such person;
(g) any obligations or duties, affecting the property of such person, to
any municipality or public authority with respect to any franchise, grant,
license or permit;
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(h) as of any particular time any controls, Liens, restrictions,
regulations, easements, exceptions or reservations of any municipality or public
authority applying particularly to space satellites or nuclear fuel;
(i) any judgment Lien against such person securing a judgment for an amount
not exceeding 25% of Consolidated Shareholders' Equity of the Borrower, so long
as the finality of such judgment is being contested by appropriate proceedings
conducted in good faith and execution thereon is stayed;
(j) any Lien arising by reason of deposits with or giving of any form of
security to any federal, state, municipal or other governmental department,
commission, board, bureau, agency or instrumentality, domestic or foreign, for
any purpose at any time as required by law or governmental regulation as a
condition to the transaction of any business or the exercise of any privilege or
license, or to enable such person to maintain self-insurance or to participate
in any fund for liability on any insurance risks or in connection with workers'
compensation, unemployment insurance, old age pensions or other social security
or to share in the privileges or benefits required for companies participating
in such arrangements; or
(k) any landlords' Lien on fixtures or movable property located on premises
leased by such person in the ordinary course of business so long as the rent
secured thereby is not in default.
"person" shall mean any natural person, corporation, business trust, joint
venture, association, company, limited liability company, partnership or
government, or any agency or political subdivision thereof.
"Plan" shall mean any employee pension benefit plan described under Section
3(2) of ERISA (other than a Multiemployer Plan) subject to the provisions of
Title IV of ERISA that is maintained by the Borrower or any ERISA Affiliate.
"Qualified Transition Bonds" shall mean securities, however denominated,
that are (i) issued by the Borrower or a Consolidated Subsidiary of the Borrower
formed and operating solely for the purpose of (A) purchasing and owning
transition property created under a "financing order" (as such term is defined
in the Texas Utilities Code) issued by the Commission, (B) issuing such
securities pursuant to such order, (C) pledging its interests in such transition
property to secure such securities and (D) engaging in activities ancillary to
those described in clauses (A), (B) and (C) above, (ii) secured by or otherwise
payable from transition charges authorized pursuant to such order, and (iii)
non-recourse to the Borrower or any of its Consolidated Subsidiaries (other than
the issuer of such securities).
"Register" shall have the meaning given such term in Section 8.04(d).
"Reportable Event" shall mean any reportable event as defined in Sections
4043(c)(1)-(8) of ERISA or the regulations issued thereunder (other than a
reportable event for which the 30 day notice requirement has been waived) with
respect to a Plan (other than a Plan maintained by an ERISA Affiliate that is
considered an ERISA Affiliate only pursuant to subsection (m) or (o) of Code
Section 414).
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"Required Lenders" shall mean, at any time, Lenders having
Commitments representing in excess of 50% of the Total Commitment or,
(i) for purposes of acceleration pursuant to clause (ii) of Article VI,
or (ii) if the Total Commitment has been terminated, Lenders holding
Loans representing in excess of 50% of the aggregate principal amount
of the Loans outstanding.
"Responsible Officer" of any corporation shall mean any
executive officer or Financial Officer of such corporation and any
other officer or similar official thereof responsible for the
administration of the obligations of such corporation in respect of
this Agreement.
"Restatement Date" shall have the meaning assigned to that
term in Section 4.01. "S&P" shall mean Standard & Poor's
Ratings Services (a division of The ▇▇▇▇▇▇-▇▇▇▇ Companies,
Inc.).
"SEC" shall mean the United States Securities and Exchange
Commission.
"Significant Disposition" shall mean a sale, lease,
disposition or other transfer by the Borrower, or any Subsidiary of the
Borrower, during any 12-month period, of assets constituting, either
individually or in the aggregate with all other assets sold, leased,
disposed or otherwise transferred by the Borrower or any Subsidiary
thereof during such period, 10% or more of the assets of the Borrower
and its Subsidiaries taken as a whole, excluding any such sale, lease,
disposition or other transfer to a Wholly Owned Subsidiary of the
Borrower.
"Significant Subsidiary" shall mean at any time, any
Subsidiary of the Borrower that as of such time has total assets in
excess of 10% of the total assets of the Borrower and its Consolidated
Subsidiaries; provided, that each of Energy and Oncor shall at all
times be considered a Significant Subsidiary of the Borrower.
"Solvent" means, with respect to any person as of a particular
date, that on such date such person is able to pay its debts and other
liabilities, contingent obligations and other commitments as they
mature in the normal course of business. In computing the amount of
contingent liabilities at any time, it is intended that such
liabilities will be computed as the amount that, in light of all the
facts and circumstances existing at such time, represents the amount
that can reasonably be expected to become an actual or matured
liability.
"Subsidiary" shall mean, with respect to any person (the
"parent"), any corporation or other entity of which securities or other
ownership interests having ordinary voting power to elect a majority of
the board of directors or other persons performing similar functions
are at the time directly or indirectly owned by such parent.
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"Substantial" shall mean an amount in excess of 10% of the
consolidated assets of the Borrower and its Consolidated Subsidiaries
taken as a whole.
"Total Commitment" shall mean, at any time, the aggregate
amount of Commitments of all the Lenders, as in effect at such time.
The Total Commitment as of the date hereof is $400,000,000.
"TXU" shall have the meaning given such term in the preamble
hereto.
"TXU Fuel" shall mean TXU Fuel Company, a Texas corporation,
and its successors.
"TXU Mining" shall mean TXU Mining Company LP, a Texas limited
partnership, and its successors.
"Type", when used in respect of any Loan or Borrowing, shall
refer to the Rate by reference to which interest on such Loan or on the
Loans comprising such Borrowing is determined. For purposes hereof,
"Rate" shall include the LIBO Rate and the Alternate Base Rate.
"Voting Shares" shall mean, as to shares or other equity
interests of a particular corporation or other type of person,
outstanding shares of stock or other equity interests of any class of
such corporation or other person entitled to vote in the election of
directors or other comparable managers of such person, excluding shares
or other interests entitled so to vote only upon the happening of some
contingency.
"Wholly Owned Subsidiary" of any person shall mean any
Consolidated Subsidiary of such person all the shares of common stock
and other voting capital stock or other voting ownership interests
having ordinary voting power to vote in the election of the board of
directors or other governing body performing similar functions (except
directors' qualifying shares) of which are at the time directly or
indirectly owned by such person.
"Withdrawal Liability" shall mean liability of the Borrower
established under Section 4201 of ERISA as a result of a complete or
partial withdrawal from a Multiemployer Plan, as such terms are defined
in Part I of Subtitle E of Title IV of ERISA.
SECTION 1.02. Terms Generally.
The definitions in Section 1.01 shall apply equally to both the
singular and plural forms of the terms defined. Whenever the context may
require, any pronoun shall include the corresponding masculine, feminine and
neuter forms. The words "include", "includes" and "including" shall be deemed to
be followed by the phrase "without limitation". All references herein to
Articles, Sections, Exhibits and Schedules shall be deemed references to
Articles and Sections of, and Exhibits and Schedules to, this Agreement unless
the context shall otherwise require. Except as otherwise expressly provided
herein, all terms of an accounting or financial nature shall be construed in
accordance with GAAP, as in effect from time to time; provided, however, that
15
for purposes of determining compliance with any covenant set forth in Article V,
such terms shall be construed in accordance with GAAP as in effect on the date
hereof applied on a basis consistent with the application used in preparing the
Borrower's audited financial statements referred to in Section 3.05.
Article II
THE CREDITS
SECTION 2.01. Commitments.
Subject to the terms and conditions and relying upon the
representations and warranties herein set forth, each Lender agrees, severally
and not jointly, to make Loans, at any time and from time to time until the
earlier of the Maturity Date and the termination of the Commitment of such
Lender, to the Borrower in an aggregate principal amount at any time outstanding
not to exceed such Lender's Commitment, subject, however, to the conditions that
(i) at no time shall the outstanding aggregate principal amount of all Loans
exceed the Total Commitment, (ii) at no time shall the outstanding aggregate
principal amount of all Loans made by any Lender exceed the amount of such
Lender's Commitment and (iii) at all times, the outstanding aggregate principal
amount of all Loans made by each Lender to the Borrower shall equal the product
of (A) the percentage that such Lender's Commitment represents of the Total
Commitment times (B) the outstanding aggregate principal amount of all Loans
made to the Borrower.
Within the foregoing limits, the Borrower may borrow, pay or prepay
and, subject to the limitations set forth in Section 2.10(a), reborrow Loans
hereunder, on and after the Restatement Date and prior to the Maturity Date,
subject to the terms, conditions and limitations set forth herein.
SECTION 2.02. Loans.
(a) Each Loan shall be made as part of a Borrowing consisting of Loans made
by the Lenders ratably in accordance with their respective Commitments;
provided, however, that the failure of any Lender to make any Loan shall not in
itself relieve any other Lender of its obligation to lend hereunder (it being
understood, however, that no Lender shall be responsible for the failure of any
other Lender to make any Loan required to be made by such other Lender). The
Loans comprising any Borrowing shall be in an aggregate principal amount that is
an integral multiple of $1,000,000 and not less than $5,000,000 (or an aggregate
principal amount equal to the remaining balance of the available Commitments).
(b) Each Borrowing shall be comprised entirely of Eurodollar Loans or ABR
Loans, as the Borrower may request pursuant to Section 2.03. Each Lender may at
its option make any Eurodollar Loan by causing any domestic or foreign branch or
Affiliate of such Lender to make such Loan; provided that any exercise of such
option shall not affect the obligation of the Borrower to repay such Loan in
accordance with the terms of this Agreement. Borrowings of more than one Type
may be outstanding at the same time.
(c) Subject to paragraph (d) below, each Lender shall make each Loan to be
made by it hereunder on the proposed date thereof by wire transfer of
16
immediately available funds to the Agent in New York, New York, not later than
noon, New York City time, and the Agent shall by 2:00 p.m., New York City time,
credit the amounts so received to the account or accounts specified from time to
time in one or more notices delivered by the Borrower to the Agent or, if a
Borrowing shall not occur on such date because any condition precedent herein
specified shall not have been met, return the amounts so received to the
respective Lenders. Loans shall be made by the Lenders pro rata in accordance
with Section 2.13. Unless the Agent shall have received notice from a Lender
prior to the date of any Borrowing that such Lender will not make available to
the Agent such Lender's portion of such Borrowing, the Agent may assume that
such Lender has made such portion available to the Agent on the date of such
Borrowing in accordance with this paragraph (c) and the Agent may, in reliance
upon such assumption, make available to the Borrower on such date a
corresponding amount. If and to the extent that such Lender shall not have made
such portion available to the Agent, such Lender and the Borrower (without
waiving any claim against such Lender for such Lender's failure to make such
portion available) severally agree to repay to the Agent forthwith on demand
such corresponding amount together with interest thereon, for each day from the
date such amount is made available to the Borrower until the date such amount is
repaid to the Agent, at (i) in the case of the Borrower, the interest rate
applicable at the time to the Loans comprising such Borrowing and (ii) in the
case of such Lender, the Federal Funds Effective Rate. If such Lender shall
repay to the Agent such corresponding amount, such amount shall constitute such
Lender's Loan as part of such Borrowing for purposes of this Agreement.
(d) The Borrower may refinance all or any part of any Borrowing with a
Borrowing of the same or a different Type, subject to the conditions and
limitations set forth in this Agreement. Any Borrowing or part thereof so
refinanced shall be deemed to be repaid or prepaid in accordance with Section
2.05 or 2.10, as applicable, with the proceeds of a new Borrowing, and the
proceeds of the new Borrowing, to the extent they do not exceed the principal
amount of the Borrowing being refinanced, shall not be paid by the Lenders to
the Agent or by the Agent to the Borrower pursuant to paragraph (c) above.
SECTION 2.03. Borrowing Procedure.
In order to request a Borrowing, the Borrower shall hand deliver or
telecopy to the Agent a duly completed Borrowing Request in the form of Exhibit
A (i) in the case of a Eurodollar Borrowing, not later than 11:00 a.m., New York
City time, three Business Days before such Borrowing, and (ii) in the case of an
ABR Borrowing, not later than 11:00 a.m., New York City time, one Business Day
before such Borrowing. Such notice shall be irrevocable and shall in each case
specify (A) whether the Borrowing then being requested is to be a Eurodollar
Borrowing or an ABR Borrowing; (B) the date of such Borrowing (which shall be a
Business Day) and the amount thereof; and (C) if such Borrowing is to be a
Eurodollar Borrowing, the Interest Period with respect thereto, which shall not
end after the Maturity Date. If no election as to the Type of Borrowing is
specified in any such notice, then the requested Borrowing shall be an ABR
Borrowing. If no Interest Period with respect to any Eurodollar Borrowing is
specified in any such notice, then the Borrower shall be deemed to have selected
an Interest Period of one month's duration (subject to the limitations set forth
in the definition of "Interest Period"). If the Borrower shall not have given
notice in accordance with this Section 2.03 of its election to refinance a
Borrowing prior to the end of the Interest Period in effect for such Borrowing,
then the Borrower shall (unless such Borrowing is repaid at the end of such
Interest Period) be deemed to have given notice of an election to refinance such
17
Borrowing with an ABR Borrowing. Notwithstanding any other provision of this
Agreement to the contrary, no Borrowing shall be requested if the Interest
Period with respect thereto would end after the scheduled Maturity Date. The
Agent shall promptly advise the Lenders of any notice given pursuant to this
Section 2.03 and of each Lender's portion of the requested Borrowing.
SECTION 2.04. Fees.
(a) The Borrower agrees to pay to each Lender, through the Agent, on each
March 31, June 30, September 30 and December 31 (with the first payment being
due on June 30, 2003) and on each date on which the Commitment of such Lender
shall be terminated or reduced as provided herein, a facility fee (a "Facility
Fee"), at a rate per annum equal to the applicable Facility Fee Percentage from
time to time in effect on the amount of the Commitment of such Lender, during
the preceding quarter (or other period commencing on the Restatement Date or
ending on the Maturity Date or any date on which the Commitment of such Lender
shall be terminated). All Facility Fees shall be computed on the basis of the
actual number of days elapsed in a year of 360 days. The Facility Fee due to
each Lender shall commence to accrue on the Restatement Date, and shall cease to
accrue on the date of termination of the Commitment of such Lender as provided
herein.
(b) The Borrower agrees to pay the Agent, for its own account, the
administrative fees in the amounts and at the times as separately agreed by the
Borrower and the Agent (the "Administrative Fees").
(c) All Fees shall be paid on the dates due, in immediately available
funds, to the Agent for distribution, if and as appropriate, among the Lenders.
Once paid, none of the Fees shall be refundable under any circumstances.
SECTION 2.05. Repayment of Loans; Evidence of Indebtedness.
(a) The outstanding principal balance of each Loan shall be due and payable
on the last day of the Interest Period applicable thereto and on the Maturity
Date.
(b) Each Lender shall maintain in accordance with its usual practice an
account or accounts evidencing the indebtedness to such Lender resulting from
each Loan made by such Lender from time to time, including the amounts of
principal and interest payable and paid to such Lender from time to time under
this Agreement.
(c) The Agent shall maintain accounts in which it will record (i) the
amount of each Loan made hereunder, the Type of each Loan made and the Interest
Period applicable thereto, (ii) the amount of any principal or interest due and
payable or to become due and payable from the Borrower to each Lender hereunder
and (iii) the amount of any sum received by the Agent hereunder from the
Borrower and each Lender's share thereof.
(d) The entries made in the accounts maintained pursuant to paragraphs (b)
and (c) of this Section 2.05 shall, to the extent permitted by applicable law,
be prima facie evidence of the existence and amounts of the obligations therein
recorded; provided, however, that the failure of any Lender or the Agent to
maintain such accounts or any error therein shall not in any manner affect the
obligations of the Borrower to repay the Loans in accordance with their terms.
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SECTION 2.06. Interest on Loans.
(a) Subject to the provisions of Section 2.07, the Loans comprising each
Eurodollar Borrowing shall bear interest (computed on the basis of the actual
number of days elapsed over a year of 360 days) at a rate per annum equal to the
LIBO Rate for the Interest Period in effect for such Borrowing plus the
Applicable Margin from time to time in effect.
(b) Subject to the provisions of Section 2.07, the Loans comprising each
ABR Borrowing shall bear interest (computed on the basis of the actual number of
days elapsed over a year of (i) 365 or 366 days, as the case may be, for periods
during which the Alternate Base Rate is determined by reference to the Prime
Rate and (ii) 360 days for other periods) at a rate per annum equal to the
Alternate Base Rate plus the Applicable Margin from time to time in effect.
(c) Interest on each Loan shall be payable on each Interest Payment Date
applicable to such Loan except as otherwise provided in this Agreement. The
applicable LIBO Rate or Alternate Base Rate for each Interest Period or day
within an Interest Period, as the case may be, shall be determined by the Agent,
and such determination shall be conclusive absent manifest error; provided that
the Agent shall, upon request, provide to the Borrower a certificate setting
forth in reasonable detail the basis for such determination.
SECTION 2.07. Default Interest.
If the Borrower shall default in the payment of the principal of or
interest on any Loan or any other amount becoming due hereunder, whether by
scheduled maturity, notice of prepayment, acceleration or otherwise, the
Borrower shall on demand from time to time from the Agent pay interest, to the
extent permitted by law, on such defaulted amount up to (but not including) the
date of actual payment (after as well as before judgment) at a rate per annum
(computed as provided in Section 2.06(b)) equal to the Alternate Base Rate plus
the Applicable Margin for ABR Loans plus 1%.
SECTION 2.08. Alternate Rate of Interest.
In the event, and on each occasion, that on the day two Business Days
prior to the commencement of any Interest Period for a Eurodollar Borrowing the
Agent shall have determined (i) that dollar deposits in the principal amounts of
the Eurodollar Loans comprising such Borrowing are not generally available in
the London interbank market or (ii) that reasonable means do not exist for
ascertaining the LIBO Rate, the Agent shall, as soon as practicable thereafter,
give telecopy notice of such determination to the Borrower and the Lenders. In
the event of any such determination under clause (i) or (ii) above, until the
Agent shall have advised the Borrower and the Lenders that the circumstances
giving rise to such notice no longer exist any request by the Borrower for a
Eurodollar Borrowing pursuant to Section 2.03 shall be deemed to be a request
for an ABR Borrowing. In the event the Required Lenders notify the Agent that
the rates at which dollar deposits are being offered will not adequately and
fairly reflect the cost to such Lenders of making or maintaining Eurodollar
Loans during such Interest Period, the Agent shall notify the Borrower of such
notice and until the Required Lenders shall have advised the Agent that the
circumstances giving rise to such notice no longer exist, any request by the
19
Borrower for a Eurodollar Borrowing shall be deemed a request for an ABR
Borrowing. Each determination by the Agent hereunder shall be made in good faith
and shall be conclusive absent manifest error; provided that the Agent, shall,
upon request, provide to the Borrower a certificate setting forth in reasonable
detail the basis for such determination.
SECTION 2.09. Termination and Reduction of Commitments.
(a) The Commitments shall be automatically terminated on the Maturity Date.
(b) Upon at least two Business Days' prior irrevocable written notice to
the Agent, the Borrower may at any time in whole permanently terminate, or from
time to time in part permanently reduce, the Total Commitment; provided,
however, that (i) each partial reduction of the Total Commitment shall be in an
integral multiple of $10,000,000 and (ii) no such termination or reduction shall
be made that would reduce the Total Commitment to an amount less than (A) the
aggregate principal amount of outstanding Loans on the date of such termination
or reduction (after giving effect to any prepayment made pursuant to Section
2.10) or (B) $25,000,000, unless the result of such termination or reduction
referred to in this clause (B) is to reduce the Total Commitment to $0. The
Agent shall advise the Lenders of any notice given pursuant to this Section
2.09(b) and of each Lender's portion of any such termination or reduction of the
Total Commitment.
(c) The Borrower agrees that (i) upon each reduction in the Credit Lyonnais
Facility Total Commitment (other than pursuant to Article VI of the Credit
Lyonnais Facility) the Total Commitment hereunder shall automatically be reduced
by an amount approximately equal to the Credit Lyonnais Facility Ratable
Percentage of the Total Commitment and (ii) upon each reduction in the ▇▇▇▇▇▇▇
▇▇▇▇▇ Facility Total Commitment (other than pursuant to Article VI of the
▇▇▇▇▇▇▇ ▇▇▇▇▇ Facility) the Total Commitment hereunder shall automatically be
reduced by an amount approximately equal to the ▇▇▇▇▇▇▇ ▇▇▇▇▇ Facility Ratable
Percentage of the Total Commitment; provided, however, that, on any day on which
both the Credit Lyonnais Facility Total Commitment and the ▇▇▇▇▇▇▇ ▇▇▇▇▇
Facility Total Commitment are reduced, and the relevant Credit Lyonnais Facility
Ratable Percentage is equal to the relevant ▇▇▇▇▇▇▇ ▇▇▇▇▇ Facility Ratable
Percentage, the Total Commitment shall not be reduced pursuant to both clauses
(i) and (ii), and shall be reduced pursuant to only one of such clauses.
(d) Each reduction in the Total Commitment hereunder shall be made ratably
among the Lenders in accordance with their respective Commitments. The Borrower
shall pay to the Agent for the account of the Lenders, on the date of each
termination or reduction of the Total Commitment, the Facility Fees on the
amount of the Commitments so terminated or reduced accrued through the date of
such termination or reduction.
SECTION 2.10. Prepayment.
(a) Voluntary Prepayment.
(i) The Borrower shall have the right at any time and from time to time to
prepay any Borrowing, in whole or in part, upon giving telecopy notice
(or telephone notice promptly confirmed by telecopy) to the Agent: (i)
20
before 11:00 a.m., New York City time, three Business Days prior to
prepayment, in the case of Eurodollar Loans, and (ii) before 11:00
a.m., New York City time, one Business Day prior to prepayment, in the
case of ABR Loans; provided, however, that each partial prepayment
shall be in an amount which is an integral multiple of $5,000,000 and
not less than $10,000,000.
(ii) Each notice of prepayment shall specify the prepayment date and the
principal amount of each Borrowing (or portion thereof) to be prepaid,
shall be irrevocable and shall commit the Borrower to prepay such
Borrowing (or portion thereof) by the amount stated therein on the date
stated therein. All prepayments under this Section 2.10 shall be
subject to Section 8.05 but otherwise without premium or penalty. All
prepayments under this Section 2.10 shall be accompanied by accrued
interest on the principal amount being prepaid to the date of payment.
(b) Mandatory Prepayment. If, at any time, the aggregate principal amount
of outstanding Loans shall exceed the Total Commitment, the Borrower shall
forthwith prepay Loans in a principal amount equal to such excess, together with
accrued interest to the date of such prepayment on the principal amount of such
Loans prepaid and any amounts owing in connection therewith pursuant to Section
8.05(b).
SECTION 2.11. Reserve Requirements; Change in Circumstances.
(a) Notwithstanding any other provision herein, if after the date of this
Agreement any change in applicable law or regulation or in the interpretation or
administration thereof by any Governmental Authority charged with the
interpretation or administration thereof (whether or not having the force of
law) shall change the basis of taxation of payments to any Lender hereunder
(except for changes in respect of taxes on the overall net income of such Lender
or its lending office imposed by the jurisdiction in which such Lender's
principal executive office or lending office is located), or shall result in the
imposition, modification or applicability of any reserve, special deposit or
similar requirement against assets of, deposits with or for the account of or
credit extended by any Lender, or shall result in the imposition on any Lender
or the London interbank market of any other condition affecting this Agreement,
such Lender's Commitment or any Eurodollar Loan made by such Lender, and the
result of any of the foregoing shall be to increase the cost to such Lender of
making or maintaining any Eurodollar Loan or to reduce the amount of any sum
received or receivable by such Lender hereunder (whether of principal, interest
or otherwise) by an amount deemed by such Lender to be material, then the
Borrower shall, upon receipt of the notice and certificate provided for in
Section 2.11(c), promptly pay to such Lender such additional amount or amounts
as will compensate such Lender for such additional costs incurred or reduction
suffered.
(b) If any Lender shall have determined that the adoption of any law, rule,
regulation or guideline arising out of the July 1988 report of the Basle
Committee on Banking Regulations and Supervisory Practices entitled
"International Convergence of Capital Measurement and Capital Standards," or the
adoption after the date hereof of any other law, rule, regulation or guideline
regarding capital adequacy, or any change in any of the foregoing or in the
interpretation or administration of any of the foregoing by any Governmental
Authority, central bank or comparable agency charged with the interpretation or
administration thereof, or compliance by any Lender (or any lending office of
such Lender) or any Lender's holding company with any request or directive
regarding capital adequacy (whether or not having the force of law) of any such
authority, central bank or comparable agency, has or would have the effect of
reducing the rate of return on such Lender's capital or on the capital of such
Lender's holding company, if any, as a consequence of this Agreement, such
21
Lender's Commitment or the Loans made by such Lender pursuant hereto to a level
below that which such Lender or such Lender's holding company could have
achieved but for such adoption, change or compliance (taking into consideration
such Lender's policies and the policies of such Lender's holding company with
respect to capital adequacy) by an amount deemed by such Lender to be material,
then from time to time such additional amount or amounts as will compensate such
Lender for any such reduction suffered will be paid by the Borrower to such
Lender.
(c) A certificate of each Lender setting forth such amount or amounts as
shall be necessary to compensate such Lender or its holding company as specified
in paragraph (a) or (b) above, and containing an explanation, in reasonable
detail, of the manner in which such amount or amounts shall have been
determined, shall be delivered to the Borrower and shall be conclusive absent
manifest error. The Borrower shall pay each Lender the amount shown as due on
any such certificate delivered by it within 10 days after its receipt of the
same. Each Lender shall give prompt notice to the Borrower of any event of which
it has knowledge, occurring after the date hereof, that it has determined will
require compensation by the Borrower pursuant to this Section; provided,
however, that failure by such Lender to give such notice shall not constitute a
waiver of such Lender's right to demand compensation hereunder.
(d) Failure on the part of any Lender to demand compensation for any
increased costs or reduction in amounts received or receivable or reduction in
return on capital with respect to any period shall not constitute a waiver of
such Lender's right to demand compensation with respect to such period or any
other period; provided, however, that no Lender shall be entitled to
compensation under this Section 2.11 for any costs incurred or reductions
suffered with respect to any date unless it shall have notified the Borrower
that it will demand compensation for such costs or reductions under paragraph
(c) above not more than 90 days after the later of (i) such date and (ii) the
date on which it shall have become aware of such costs or reductions. The
protection of this Section shall be available to each Lender regardless of any
possible contention of the invalidity or inapplicability of the law, rule,
regulation, guideline or other change or condition that shall have occurred or
been imposed.
(e) Each Lender agrees that it will designate a different lending office if
such designation will avoid the need for, or reduce the amount of, such
compensation and will not, in the reasonable judgment of such Lender, be
disadvantageous to such Lender.
SECTION 2.12. Change in Legality.
(a) Notwithstanding any other provision herein, if any change in any law or
regulation or in the interpretation thereof by any Governmental Authority
charged with the administration or interpretation thereof shall make it unlawful
for any Lender to make or maintain any Eurodollar Loan or to give effect to its
obligations as contemplated hereby with respect to any Eurodollar Loan, then, by
written notice to the Borrower and to the Agent, such Lender may:
22
(i) declare that Eurodollar Loans will not thereafter be made by such
Lender hereunder, whereupon any request for a Eurodollar Borrowing
shall, as to such Lender only, be deemed a request for an ABR Loan
unless such declaration shall be subsequently withdrawn (any Lender
delivering such a declaration hereby agreeing to withdraw such
declaration promptly upon determining that such event of illegality no
longer exists); and
(ii) require that all outstanding Eurodollar Loans made by it be
converted to ABR Loans, in which event all such Eurodollar Loans shall be
automatically converted to ABR Loans as of the effective date of such
notice as provided in paragraph (b) below.
In the event any Lender shall exercise its rights under (i) or (ii) above, all
payments and prepayments of principal that would otherwise have been applied to
repay the Eurodollar Loans that would have been made by such Lender or the
converted Eurodollar Loans of such Lender shall instead be applied to repay the
ABR Loans made by such Lender in lieu of, or resulting from the conversion of,
such Eurodollar Loans.
(b) For purposes of this Section 2.12, a notice by any Lender shall be
effective as to each Eurodollar Loan, if lawful, on the last day of the Interest
Period currently applicable to such Eurodollar Loan; in all other cases such
notice shall be effective on the date of receipt.
SECTION 2.13. Pro Rata Treatment.
Except as required under Sections 2.12 and 2.17, each Borrowing, each
payment or prepayment of principal of any Borrowing, each payment of interest on
the Loans, each payment of the Facility Fees, each reduction of the Commitments
and each refinancing or conversion of any Borrowing with a Borrowing of any
Type, shall be allocated pro rata among the Lenders in accordance with their
respective Commitments (or, if such Commitments shall have expired or been
terminated, in accordance with the respective principal amounts of their
outstanding Loans). Each Lender agrees that in computing such Lender's portion
of any Borrowing to be made hereunder, the Agent may, in its discretion, round
each Lender's percentage of such Borrowing to the next higher or lower whole
dollar amount.
SECTION 2.14. Sharing of Setoffs.
Each Lender agrees that if it shall, through the exercise of a right of
banker's lien, setoff or counterclaim, or pursuant to a secured claim under
Section 506 of Title 11 of the United States Bankruptcy Code or other security
or interest arising from, or in lieu of, such secured claim, received by such
Lender under any applicable bankruptcy, insolvency or other similar law or
otherwise, or by any other means, obtain payment (voluntary or involuntary) in
respect of any Loan or Loans as a result of which the unpaid principal portion
of its Loans shall be proportionately less than the unpaid principal portion of
the Loans of any other Lender, it shall be deemed simultaneously to have
purchased from such other Lender at face value, and shall promptly pay to such
other Lender the purchase price for, a participation in the Loans of such other
Lender, so that the aggregate unpaid principal amount of the Loans and
participations in the Loans held by each Lender shall be in the same proportion
to the aggregate unpaid principal amount of all Loans then outstanding as the
principal amount of its Loans prior to such exercise of banker's lien, setoff or
counterclaim or other event was to the principal amount of all Loans outstanding
23
prior to such exercise of banker's lien, setoff or counterclaim or other event;
provided, however, that, if any such purchase or purchases or adjustments shall
be made pursuant to this Section 2.14 and the payment giving rise thereto shall
thereafter be recovered, such purchase or purchases or adjustments shall be
rescinded to the extent of such recovery and the purchase price or prices or
adjustment restored without interest. The Borrower expressly consents to the
foregoing arrangements and agrees that any Lender holding a participation in a
Loan deemed to have been so purchased may exercise any and all rights of
banker's lien, setoff or counterclaim with respect to any and all moneys owing
by the Borrower to such Lender by reason thereof as fully as if such Lender had
made a Loan in the amount of such participation.
SECTION 2.15. Payments.
(a) The Borrower shall make each payment (including principal of or
interest on any Borrowing or any Fees or other amounts) hereunder from an
account in the United States not later than 12:00 noon, New York City time, on
the date when due in dollars to the Agent at its offices at ▇▇▇ ▇▇▇▇▇ ▇▇▇, ▇▇▇▇▇
▇▇▇, ▇▇▇ ▇▇▇▇▇▇, ▇▇▇▇▇▇▇▇ ▇▇▇▇▇, Attention: Medium Term Finance, Account:
3685-2248, in immediately available funds. Each such payment shall be made
without off-set, deduction or counterclaim, provided, that the foregoing shall
not constitute a relinquishment or waiver of the Borrower's rights to any
independent claim that the Borrower may have against the Agent or any Lender.
(b) Whenever any payment (including principal of or interest on any
Borrowing or any Fees or other amounts) hereunder shall become due, or otherwise
would occur, on a day that is not a Business Day, such payment may be made on
the next succeeding Business Day, and such extension of time shall in such case
be included in the computation of interest or Fees, if applicable.
SECTION 2.16. Taxes.
(a) Any and all payments of principal and interest on any Borrowings, or of
any Fees or indemnity or expense reimbursements by the Borrower hereunder
("Borrower Payments") shall be made, in accordance with Section 2.15, free and
clear of and without deduction for any and all current or future United States
Federal, state and local taxes, levies, imposts, deductions, charges or
withholdings, and all liabilities with respect to such Borrower Payments, but
only to the extent reasonably attributable to such Borrower Payments, excluding
(i) income taxes imposed on the net income of the Agent or any Lender (or any
transferee or assignee thereof, including a participation holder (any such
entity a "Transferee")) and (ii) franchise taxes imposed on the net income of
the Agent or any Lender (or Transferee), in each case by the jurisdiction under
the laws of which the Agent or such Lender (or Transferee) is organized or doing
business through offices or branches located therein, or any political
subdivision thereof (all such nonexcluded taxes, levies, imposts, deductions,
charges, withholdings and liabilities, collectively or individually, "Taxes").
If the Borrower shall be required to deduct any Taxes from or in respect of any
sum payable hereunder to any Lender (or any Transferee) or the Agent, (i) the
sum payable shall be increased by the amount (an "additional amount") necessary
so that after making all required deductions (including deductions applicable to
additional sums payable under this Section 2.16) such Lender (or Transferee) or
the Agent (as the case may be) shall receive an amount equal to the sum it would
have received had no such deductions been made, (ii) the Borrower shall make
such deductions and (iii) the Borrower shall pay the full amount deducted to the
relevant Governmental Authority in accordance with applicable law.
24
(b) In addition, the Borrower shall pay to the relevant United States
Governmental Authority in accordance with applicable law any current or future
stamp or documentary taxes or any other excise or property taxes, charges or
similar levies that arise from any payment made hereunder or from the execution,
delivery or registration of, or otherwise with respect to, this Agreement
("Other Taxes").
(c) The Borrower shall indemnify each Lender (or Transferee thereof) and
the Agent for the full amount of Taxes and Other Taxes with respect to Borrower
Payments paid by such Lender (or Transferee) or the Agent, as the case may be,
and any liability (including penalties, interest and expenses (including
reasonable attorney's fees and expenses)) arising therefrom or with respect
thereto, whether or not such Taxes or Other Taxes were correctly or legally
asserted by the relevant United States Governmental Authority. A certificate
setting forth and containing an explanation in reasonable detail of the manner
in which such amount shall have been determined and the amount of such payment
or liability prepared by a Lender, or the Agent on behalf of a Lender, absent
manifest error, shall be final, conclusive and binding for all purposes. Such
indemnification shall be made within 30 days after the date the Lender (or
Transferee) or the Agent, as the case may be, makes written demand therefor.
(d) If a Lender (or Transferee) or the Agent shall become aware that it is
entitled to claim a refund from a United States Governmental Authority in
respect of Taxes or Other Taxes as to which it has been indemnified by the
Borrower, or with respect to which the Borrower has paid additional amounts,
pursuant to this Section 2.16, it shall promptly notify the Borrower of the
availability of such refund claim and shall, within 30 days after receipt of a
request by the Borrower, make a claim to such United States Governmental
Authority for such refund at the Borrower's expense. If a Lender (or Transferee)
or the Agent receives a refund (including pursuant to a claim for refund made
pursuant to the preceding sentence) in respect of any Taxes or Other Taxes as to
which it has been indemnified by the Borrower or with respect to which the
Borrower had paid additional amounts pursuant to this Section 2.16, it shall
within 30 days from the date of such receipt pay over such refund to the
Borrower (but only to the extent of indemnity payments made, or additional
amounts paid, by the Borrower under this Section 2.16 with respect to the Taxes
or Other Taxes giving rise to such refund), net of all out-of-pocket expenses of
such Lender (or Transferee) or the Agent and without interest (other than
interest paid by the relevant United States Governmental Authority with respect
to such refund); provided, however, that the Borrower, upon the request of such
Lender (or Transferee) or the Agent, agrees to repay the amount paid over to the
Borrower (plus penalties, interest or other charges) to such Lender (or
Transferee) or the Agent in the event such Lender (or Transferee) or the Agent
is required to repay such refund to such United States Governmental Authority.
(e) As soon as practicable, but in any event within 30 days, after the date
of any payment of Taxes or Other Taxes by the Borrower to the relevant United
States Governmental Authority, the Borrower will deliver to the Agent, at its
address referred to in Section 8.01, the original or a certified copy of a
receipt issued by such United States Governmental Authority evidencing payment
thereof.
25
(f) Without prejudice to the survival of any other agreement contained
herein, the agreements and obligations contained in this Section 2.16 shall
survive the payment in full of the principal of and interest on all Loans made
hereunder.
(g) Each Lender (or Transferee) that is organized under the laws of a
jurisdiction other than the United States, any State thereof or the District of
Columbia (a "Non-U.S. Lender") shall deliver to the Borrower and the Agent two
copies of either United States Internal Revenue Service Form W-8BEN or Form
W-8ECI, properly completed and duly executed by such Non-U.S. Lender claiming
complete exemption from, or reduced rate of, United States Federal withholding
tax on payments by the Borrower under this Agreement. Such forms shall be
delivered by each Non-U.S. Lender on or before the date it becomes a party to
this Agreement (or, in the case of a Transferee that is a participation holder,
on or before the date such participation holder becomes a Transferee hereunder)
and on or before the date, if any, such Non-U.S. Lender changes its applicable
lending office by designating a different lending office (a "New Lending
Office"). In addition, each Non-U.S. Lender shall deliver such forms promptly
upon the obsolescence or invalidity of any form previously delivered by such
Non-U.S. Lender. Notwithstanding any other provision of this Section 2.16(g), a
Non-U.S. Lender shall not be required to deliver any form pursuant to this
Section 2.16(g) that such Non-U.S. Lender is not legally able to deliver.
(h) The Borrower shall not be required to indemnify any Non-U.S. Lender
(including any Transferee), or to pay any additional amounts to any Non-U.S.
Lender (including any Transferee), in respect of United States Federal, state or
local withholding tax pursuant to paragraph (a) or (c) above to the extent that
(i) the obligation to withhold amounts with respect to United States Federal,
state or local withholding tax existed on the date such Non-U.S. Lender became a
party to this Agreement (or, in the case of a Transferee that is a participation
holder, on the date such participation holder became a Transferee hereunder) or,
with respect to payments to a New Lending Office, the date such Non-U.S. Lender
designated such New Lending Office with respect to a Loan; provided, however,
that this clause (i) shall not apply to any Transferee or New Lending Office
that becomes a Transferee or New Lending Office as a result of an assignment,
participation, transfer or designation made at the request of the Borrower; and
provided further, however, that this clause (i) shall not apply to the extent
the indemnity payment or additional amounts any Transferee, or Lender (or
Transferee) through a New Lending Office, would be entitled to receive (without
regard to this clause (i)) do not exceed the indemnity payment or additional
amounts that the person making the assignment, participation or transfer to such
Transferee, or Lender (or Transferee) making the designation of such New Lending
Office, would have been entitled to receive in the absence of such assignment,
participation, transfer or designation or (ii) the obligation to pay such
additional amounts or such indemnity payments would not have arisen but for a
failure by such Non-U.S. Lender (including any Transferee) to comply with the
provisions of paragraph (g) above and (i) below.
(i) Any Lender (or Transferee) claiming any indemnity payment or additional
amounts payable pursuant to this Section 2.16 shall use reasonable efforts
(consistent with legal and regulatory restrictions) to file any certificate or
document reasonably requested in writing by the Borrower or to change the
jurisdiction of its applicable lending office if the making of such a filing or
change would avoid the need for or reduce the amount of any such indemnity
payment or additional amounts that may thereafter accrue and would not, in the
good faith determination of such Lender (or Transferee), be otherwise
disadvantageous to such Lender (or Transferee).
26
(j) Nothing contained in this Section 2.16 shall require any Lender (or
Transferee) or the Agent to make available to the Borrower any of its tax
returns (or any other information) that it deems to be confidential or
proprietary.
SECTION 2.17. Assignment of Commitments Under Certain Circumstances.
In the event that any Lender shall have delivered a notice or
certificate pursuant to Section 2.11 or 2.12, or the Borrower shall be required
to make additional payments to any Lender under Section 2.16, the Borrower shall
have the right, at its own expense, upon notice to such Lender and the Agent, to
require such Lender to transfer and assign without recourse (in accordance with
and subject to the restrictions contained in Section 8.04) all such Lender's
interests, rights and obligations contained hereunder to another financial
institution approved by the Agent and the Borrower (which approval shall not be
unreasonably withheld) which shall assume such obligations; provided that (i) no
such assignment shall conflict with any law, rule or regulation or order of any
Governmental Authority and (ii) the assignee shall pay to the affected Lender in
immediately available funds on the date of such assignment the principal of and
interest accrued to the date of payment on the Loans made by it hereunder and
all other amounts accrued for its account or owed to it hereunder and the
Borrower shall pay the processing and recordation fee due pursuant to Section
8.04.
Article III
REPRESENTATIONS AND WARRANTIES
The Borrower represents and warrants to each of the Lenders as follows:
SECTION 3.01. Organization; Powers.
The Borrower (i) is a corporation duly organized, validly existing and
in good standing under the laws of the jurisdiction of its organization, (ii)
has all requisite power and authority to own its property and assets and to
carry on its business as now conducted and as proposed to be conducted, (iii) is
qualified to do business in every jurisdiction where such qualification is
required, except where the failure so to qualify would not result in a Material
Adverse Change, and (iv) has the corporate power and authority to execute,
deliver and perform its obligations under this Agreement and to borrow
hereunder.
SECTION 3.02. Authorization.
The execution, delivery and performance by the Borrower of this
Agreement and the Borrowings hereunder (i) have been duly authorized by all
requisite corporate action and (ii) will not (A) violate (x) any provision of
any law, statute, rule or regulation (including, the Margin Regulations) to
which the Borrower is subject or of the certificate of incorporation or other
constitutive documents or by-laws of the Borrower or any of its Subsidiaries,
(y) any order of any Governmental Authority or (z) any provision of any
indenture, agreement or other instrument to which the Borrower or any of its
27
Subsidiaries is a party or by which it or any of its property is or may be
bound, (B) be in conflict with, result in a breach of or constitute (alone or
with notice or lapse of time or both) a default under any such indenture,
agreement or other instrument or (C) result in the creation or imposition of any
Lien upon any property or assets of the Borrower.
SECTION 3.03. Enforceability.
This Agreement constitutes a legal, valid and binding obligation of the
Borrower enforceable in accordance with its terms except to the extent that
enforcement may be limited by bankruptcy, insolvency or similar laws affecting
the enforcement of creditors' rights generally.
SECTION 3.04. Governmental Approvals.
No action, consent or approval of, registration or filing with or other
action by any Governmental Authority is or will be required in connection with
the execution, delivery and performance by the Borrower of this Agreement,
except those as have been duly obtained and as are (i) in full force and effect,
(ii) sufficient for their purpose and (iii) not subject to any pending or, to
the knowledge of the Borrower, threatened appeal or other proceeding seeking
reconsideration or review thereof.
SECTION 3.05. Financial Statements.
(a) The consolidated balance sheet of the Borrower and its Consolidated
Subsidiaries as of December 31, 2002 and the related consolidated statements of
income, retained earnings and cash flows for the fiscal year then ended,
reported on by Deloitte & Touche LLP and set forth in the Borrower's 2002 Annual
Report on Form 10-K, copies of which have been delivered to each of the Lenders,
present fairly, in all material respects, the consolidated financial position of
the Borrower and its Consolidated Subsidiaries as of such date and their
consolidated results of operations and cash flows for such period ending on such
date, in conformity with GAAP.
(b) Except as set forth in the financial statements or other reports of the
type referred to in Section 5.03 hereof and that have been delivered to the
Lenders on or prior to the date hereof, since December 31, 2002, there has been
no Material Adverse Change with respect to the Borrower, other than as a result
of the matters excluded from the computation of Consolidated Earnings Available
for Fixed Charges as set forth in the definition thereof.
SECTION 3.06. Litigation.
Except as set forth in the financial statements or other reports of the
type referred to in Section 5.03 hereof and that have been delivered to the
Lenders on or prior to the date hereof, there is no action, suit or proceeding
pending against, or to the knowledge of the Borrower threatened against or
affecting, the Borrower or any of its Subsidiaries before any court or
arbitrator or any governmental body, agency or official in which there is a
reasonable possibility of an adverse decision that could materially adversely
affect the ability of the Borrower to pay its obligations hereunder or that in
any manner draws into question the validity of this Agreement.
28
SECTION 3.07. Federal Reserve Regulations.
(a) Neither the Borrower nor any of its Subsidiaries is engaged
principally, or as one of its important activities, in the business of extending
credit for the purpose of purchasing or carrying Margin Stock.
(b) No part of the proceeds of any Loan will be used by the Borrower,
whether directly or indirectly, and whether immediately, incidentally or
ultimately, to purchase or carry Margin Stock or to refund indebtedness
originally incurred for such purpose, or for any other purpose which entails a
violation of, or which is inconsistent with, the provisions of the Margin
Regulations.
(c) Not more than 25% of the value of the assets of the Borrower subject to
the restrictions of Sections 5.09 and 5.10 are represented by Margin Stock.
SECTION 3.08. Investment Company Act; Public Utility Holding Company Act.
(a) Neither the Borrower nor any of its Subsidiaries is an "investment
company" as defined in, or subject to regulation under, the Investment Company
Act of 1940.
(b) The Borrower and each of its Subsidiaries is exempt from all provisions
of the Public Utility Holding Company Act of 1935 and rules and regulations
thereunder, except for Sections 9(a)(2) and 33 of such Act and the rules and
regulations thereunder, and the execution and delivery by the Borrower of this
Agreement and the performance of its obligations hereunder do not violate any
provision of such Act or any rule or regulation thereunder.
SECTION 3.09. No Material Misstatements.
No report, financial statement or other written information furnished by or
on behalf of the Borrower to the Agent or any Lender pursuant to or in
connection with this Agreement contains or will contain any material
misstatement of fact or omits or will omit to state any material fact necessary
to make the statements therein, in the light of the circumstances under which
they were or will be made, not misleading.
SECTION 3.10. Taxes.
The Borrower and its Subsidiaries have filed or caused to be filed
within 3 days of the date on which due, all material Federal, state and local
tax returns that to their knowledge are required to be filed by them, and have
paid or caused to be paid all material taxes shown to be due and payable on such
returns or on any assessments received by them, other than any taxes or
assessments the validity of which is being contested in good faith by
appropriate proceedings and with respect to which appropriate accounting
reserves have to the extent required by GAAP been set aside.
SECTION 3.11. Employee Benefit Plans.
With respect to each Plan, the Borrower and its ERISA Affiliates are in
compliance in all material respects with the applicable provisions of ERISA and
29
the Code and the final regulations and published interpretations thereunder. No
ERISA Event has occurred that alone or together with any other ERISA Event has
resulted or could reasonably be expected to result in a Material Adverse Change.
Neither the Borrower nor any ERISA Affiliate has incurred any Withdrawal
Liability that could result in a Material Adverse Change. Neither the Borrower
nor any ERISA Affiliate has received any notification that any Multiemployer
Plan is in reorganization or has been terminated within the meaning of Title IV
of ERISA, which such reorganization or termination could result in a Material
Adverse Change, and no Multiemployer Plan is reasonably expected to be in
reorganization or to be terminated where such reorganization or termination has
resulted or can reasonably be expected to result, through an increase in the
contributions required to be made to such Plan or otherwise, in a Material
Adverse Change.
SECTION 3.12. Significant Subsidiaries.
Each of the Borrower's Significant Subsidiaries is a corporation,
limited liability company or other type of person duly incorporated or formed
(as the case may be), validly existing and in good standing under the laws of
its jurisdiction of incorporation or formation (as the case may be) and has all
corporate, limited liability company, partnership or other (as the case may be)
powers necessary to carry on its business substantially as now conducted. The
Borrower's Significant Subsidiaries have all material governmental licenses,
authorizations, consents and approvals required to carry on the business of the
Significant Subsidiaries substantially as now conducted.
SECTION 3.13. Environmental Matters.
Except as set forth in or contemplated by the financial statements or
other reports of the type referred to in Section 5.03 hereof and that have been
delivered to the Lenders on or prior to the date hereof, the Borrower and each
of its Subsidiaries has complied in all material respects with all Federal,
state, local and other statutes, ordinances, orders, judgments, rulings and
regulations relating to environmental pollution or to environmental or nuclear
regulation or control, except to the extent that failure to so comply could not
reasonably be expected to result in a Material Adverse Change. Except as set
forth in or contemplated by such financial statements or other reports, neither
the Borrower nor any of its Subsidiaries has received notice of any material
failure so to comply, except where such failure could not reasonably be expected
to result in a Material Adverse Change. Except as set forth in or contemplated
by such financial statements or other reports, the facilities of the Borrower or
any of its Subsidiaries, as the case may be, are not used to manage any
hazardous wastes, hazardous substances, hazardous materials, toxic substances,
toxic pollutants or substances similarly denominated, as those terms or similar
terms are used in the Resource Conservation and Recovery Act, the Comprehensive
Environmental Response Compensation and Liability Act, the Hazardous Materials
Transportation Act, the Toxic Substance Control Act, the Clean Air Act, the
Clean Water Act or any other applicable law relating to environmental pollution,
or any nuclear fuel or other radioactive materials, in violation in any material
respect of any law or any regulations promulgated pursuant thereto, except to
the extent that such violations could not reasonably be expected to result in a
Material Adverse Change. Except as set forth in or contemplated by such
financial statements or other reports, the Borrower is aware of no events,
conditions or circumstances involving environmental pollution or contamination
that could reasonably be expected to result in a Material Adverse Change.
30
SECTION 3.14. Solvency.
The Borrower is Solvent.
Article IV
CONDITIONS
The obligations of the Lenders to make Loans, and the effectiveness of
this Agreement, hereunder are subject to the satisfaction of the following
conditions:
SECTION 4.01. Restatement Date.
The Commitment of each Lender to make any Loan on or after the date
hereof and the effectiveness of this Agreement are subject to the conditions
(the first date such conditions are satisfied being hereinafter referred to as
the "Restatement Date") that on or prior to the Restatement Date:
(a) The Agent shall have received all accrued but unpaid fees under the
Original Agreement and all other amounts due and payable as of the Restatement
Date by the Exiting Borrower under the Original Agreement.
(b) The Agent shall have received a counterpart of this Agreement executed
by the Agent, the Exiting Borrower, the Borrower and all the Lenders.
(c) The Agent shall have received favorable written legal opinions of (i)
(A) ▇▇▇▇▇▇ ▇▇▇▇ & Priest LLP, special New York counsel to the Borrower, and (B)
Hunton & ▇▇▇▇▇▇▇▇ LLP, counsel to the Borrower, and (ii) King & Spalding LLP,
special New York counsel to the Agent, in each case dated the date hereof,
addressed to the Agent and the Lenders and in form and substance satisfactory to
the Agent.
(d) The Agent shall have received (i) a copy of the certificate of
incorporation, including all amendments thereto, of the Borrower, certified as
of a recent date by the Secretary of State of the State of Texas, and a
certificate as to the good standing of the Borrower as of a recent date from
such Secretary of State; (ii) a certificate of the Secretary or an Assistant
Secretary of the Borrower, dated the Restatement Date and certifying (A) that
attached thereto is a true and complete copy of the bylaws of the Borrower as in
effect on such date and at all times since a date prior to the date of the
resolutions described in clause (B) below, (B) that attached thereto are true
and complete copies of resolutions duly adopted by the board of directors of the
Borrower authorizing the execution and delivery by the Borrower of this
Agreement, the Borrowings to be made by the Borrower hereunder and the
performance by the Borrower of all of its obligations hereunder, and that such
resolutions have not been modified, rescinded or amended and are in full force
and effect, (C) that the certificate of incorporation referred to in clause (i)
above has not been amended since the date of the last amendment thereto shown on
the certificate of good standing furnished pursuant to such clause (i) and (D)
as to the incumbency and specimen signature of each officer executing this
Agreement and any other document delivered in connection herewith on behalf of
the Borrower; (iii) a certificate of another officer of the Borrower as to the
incumbency and specimen signature of the Secretary or Assistant Secretary
executing the certificate pursuant to (ii) above; and (iv) a certificate of a
Responsible Officer of the Borrower, dated the Restatement Date and stating that
31
(A) no action, consent or approval of, registration or filing with or other
action by any Governmental Authority is or will be required in connection with
the execution, delivery and performance by the Borrower of this Agreement,
except those as have been duly obtained and as are (1) in full force and effect,
(2) sufficient for their purpose and (3) not subject to any pending or, to the
knowledge of such person, threatened appeal or other proceeding seeking
reconsideration or review thereof, (B) the representations and warranties set
forth in Article III hereof are true and correct in all material respects on and
as of the Restatement Date, and (C) no Event of Default or Default under this
Agreement has occurred and is continuing on the Restatement Date.
(e) The Lenders and the Agent shall have received payment of all fees and
reimbursement of all expenses for which invoices have been presented as and when
due on or prior to the Restatement Date.
(f) The Agent shall have received such other approvals, opinions,
certificates, instruments and documents as the Agent or any of the Lenders may
have reasonably requested, in form satisfactory to the Agent and the requesting
Lender (if applicable).
SECTION 4.02. Conditions for All Loans.
The Commitment of each Lender to make each Loan to be made by it in
connection with any Borrowing (including the initial Borrowing) shall be subject
to the satisfaction of the following conditions precedent on the date of such
Borrowing:
(a) The Agent shall have received a notice of such Borrowing as required by
Section 2.03.
(b) The representations and warranties of the Borrower set forth in Article
III hereof (except in the case of a refinancing of a Borrowing with a new
Borrowing that does not increase the aggregate principal amount of the Loans of
any Lender outstanding, the representations set forth in Sections 3.05(b), 3.06,
3.11 and 3.13) shall be true and correct in all material respects on and as of
the date of such Borrowing with the same effect as though made on and as of such
date, except to the extent such representations and warranties expressly relate
to an earlier date.
(c) At the time of and immediately after such Borrowing, no Event of
Default or Default shall have occurred and be continuing.
(d) The Agent shall have received a certificate of a Responsible Officer of
the Borrower certifying that the matters set forth in paragraphs (b) and (c) of
this Section 4.02 are true and correct as of such date.
Each such Loan shall be deemed to constitute a representation and warranty by
the Borrower on the date of such Borrowing as to the matters specified in
paragraphs (b) and (c) of this Section 4.02.
32
Article V
COVENANTS
The Borrower agrees that, so long as any Lender has any Commitment
hereunder or any amount payable hereunder remains unpaid:
SECTION 5.01. Existence.
It will, and will cause each of its Significant Subsidiaries to, do or
cause to be done all things necessary to preserve and keep in full force and
effect its existence and all rights, licenses, permits, franchises and
authorizations necessary or desirable in the normal conduct of its business
except as otherwise permitted pursuant to Section 5.09.
SECTION 5.02. Compliance With Laws; Business and Properties.
It will, and will cause each of its Subsidiaries to, comply with all
applicable material laws, rules, regulations and orders of any Governmental
Authority, whether now in effect or hereafter enacted, except where the validity
or applicability of such laws, rules, regulations or orders is being contested
by appropriate proceedings in good faith; and at all times maintain and preserve
all property material to the conduct of its business and keep such property in
good repair, working order and condition and from time to time make, or cause to
be made, all needful and proper repairs, renewals, additions, improvements and
replacements thereto necessary in order that the business carried on in
connection therewith may be properly conducted at all times.
SECTION 5.03. Financial Statements, Reports, Etc.
It will furnish to the Agent and each Lender:
(a) as soon as available, and in any event within 120 days after the end of
each fiscal year of the Borrower, a consolidated balance sheet of the Borrower
and its Consolidated Subsidiaries as of the end of such fiscal year and the
related consolidated statements of income, retained earnings and cash flows for
such fiscal year, setting forth in each case in comparative form the figures for
the previous fiscal year, all reported on in a manner reasonably acceptable to
the SEC by Deloitte & Touche LLP or other independent public accountants of
nationally recognized standing;
(b) as soon as available, and in any event within 60 days after the end of
each of the first three quarters of each fiscal year of the Borrower, a
consolidated balance sheet of the Borrower and its Consolidated Subsidiaries as
of the end of such quarter and the related consolidated statements of income for
such quarter, for the portion of the Borrower's fiscal year ended at the end of
such quarter, and for the twelve months ended at the end of such quarter, and
the related consolidated statement of cash flows for the portion of the
Borrower's fiscal year ended at the end of such quarter, setting forth
comparative figures for previous dates and periods to the extent required in
Form 10-Q, all certified (subject to normal year-end adjustments) as to fairness
of presentation, GAAP and consistency by a Financial Officer of the Borrower;
(c) simultaneously with any delivery of each set of financial statements
referred to in paragraphs (a) and (b) above a certificate of a Financial Officer
of the Borrower (i) setting forth in reasonable detail the calculations required
33
to establish whether the Borrower was in compliance with the requirements of
Sections 5.11 and 5.12 on the date of such financial statements, and (ii)
stating whether any Default or Event of Default exists on the date of such
certificate and, if any Default or Event of Default then exists, setting forth
the details thereof and the action that the Borrower is taking or proposes to
take with respect thereto;
(d) simultaneously with the delivery of each set of financial statements
referred to in paragraph (a) above, a statement of the firm of independent
public accountants that reported on such statements (i) stating whether anything
has come to their attention to cause them to believe that any Default or Event
of Default existed on the date of such statements and (ii) confirming the
calculations set forth in the Financial Officer's certificate delivered
simultaneously therewith pursuant to paragraph (c) above;
(e) forthwith upon becoming aware of the occurrence of any Default or Event
of Default, a certificate of a Financial Officer of the Borrower setting forth
the details thereof and the action that the Borrower is taking or proposes to
take with respect thereto;
(f) promptly upon the filing thereof, copies of each final prospectus
(other than a prospectus included in any registration statement on Form S-8 or
its equivalent or with respect to a dividend reinvestment plan) and all reports
on Forms 10-K, 10-Q and 8-K and similar reports that the Borrower shall have
filed with the SEC, or any Governmental Authority succeeding to any of or all
the functions of the SEC;
(g) if and when any member of the Controlled Group (i) gives or is required
to give notice to the PBGC of any Reportable Event with respect to any Plan that
might constitute grounds for a termination of such Plan under Title IV of ERISA,
or knows that the plan administrator of any Plan has given or is required to
give notice of any such Reportable Event, a copy of the notice of such
Reportable Event given or required to be given to the PBGC; (ii) receives notice
from a proper representative of a Multiemployer Plan of complete or partial
Withdrawal Liability being imposed upon such member of the Controlled Group
under Title IV of ERISA, a copy of such notice; or (iii) receives notice from
the PBGC under Title IV of ERISA of an intent to terminate, or appoint a trustee
to administer, any Plan, a copy of such notice; and
(h) promptly, from time to time, such additional information regarding the
financial position or business of the Borrower and its Subsidiaries as the
Agent, at the request of any Lender, may reasonably request.
As promptly as practicable after delivering each set of financial
statements as required in paragraph (a) of this Section, the Borrower shall make
available a copy of the consolidating workpapers used by the Borrower in
preparing such consolidated statements to each Lender that shall have requested
such consolidating workpapers. Each Lender that receives such consolidating
workpapers shall hold them in confidence as required by Section 8.15; provided
that no Lender may disclose such consolidating workpapers to any other person
pursuant to clause (iv) of Section 8.15.
34
SECTION 5.04. Insurance.
It will, and will cause each of its Subsidiaries to, maintain such
insurance or self insurance, to such extent and against such risks, including
fire and other risks insured against by extended coverage, as is customary with
companies similarly situated and in the same or similar businesses.
SECTION 5.05. Taxes, Etc.
It will, and will cause each of its Subsidiaries to, pay and discharge
promptly when due all material taxes, assessments and governmental charges
imposed upon it or upon its income or profits or in respect of its property, as
well as all other material liabilities, in each case before the same shall
become delinquent or in default and before penalties accrue thereon, unless and
to the extent that the same are being contested in good faith by appropriate
proceedings and adequate reserves with respect thereto shall, to the extent
required by GAAP, have been set aside.
SECTION 5.06. Maintaining Records; Access to Properties and Inspections.
It will, and will cause each of its Subsidiaries to, maintain financial
records in accordance with GAAP and, upon reasonable notice and at reasonable
times, permit authorized representatives designated by any Lender to visit and
inspect its properties and to discuss its affairs, finances and condition with
its officers.
SECTION 5.07. ERISA.
It will, and will cause each of its Subsidiaries that are members of
the Controlled Group to, comply in all material respects with the applicable
provisions of ERISA and the Code except where any noncompliance, individually or
in the aggregate, would not result in a Material Adverse Change.
SECTION 5.08. Use of Proceeds.
It will not, and will not cause or permit any of its Subsidiaries to,
use the proceeds of the Loans for purposes other than to refinance the amounts
outstanding under the Original Agreement and for working capital and other
general corporate purposes, including the refinancing of short-term borrowings
used for working capital and other general corporate purposes.
SECTION 5.09. Consolidations, Mergers, Sales and Acquisitions of
Assets and Investments in Subsidiaries.
It (i) will not, and will not permit any of its Significant
Subsidiaries to, consolidate or merge with or into any person unless, (A) in the
case of any such transaction involving the Borrower, the surviving person is the
Borrower or another person formed under the laws of a State of the United States
of America and assumes or is responsible, by operation of law, for all the
obligations of the Borrower hereunder and (B) in the case of any such
transaction involving any such Significant Subsidiary, the survivor is the
Borrower, such Significant Subsidiary or a Wholly Owned Subsidiary of the
Borrower (or a person which as a result of such transaction becomes a Wholly
35
Owned Subsidiary of the Borrower), and (ii) will not, and will not permit any of
its Significant Subsidiaries to, make a Significant Disposition to any person
other than the Borrower or a Wholly Owned Subsidiary of the Borrower (or a
person which as a result of such transaction becomes a Wholly Owned Subsidiary
of the Borrower), provided that the Borrower will not in any event permit any
such consolidation, merger, sale, lease or transfer if any Default or Event of
Default shall have occurred and be continuing at the time of or after giving
effect to such transaction. Notwithstanding the foregoing, (x) neither the
Borrower nor any of its Subsidiaries will engage to a Substantial extent in
businesses other than those currently conducted by them and other businesses
reasonably related thereto, (y) neither the Borrower nor any of its Subsidiaries
will acquire any Subsidiary or make any investment in any Subsidiary if, upon
giving effect to such acquisition or investment, as the case may be, the
Borrower would not be in compliance with the covenants set forth in Sections
5.11 and 5.12 and (z) nothing in this Section shall prohibit any sales of assets
permitted by Section 5.10(d).
SECTION 5.10. Limitations on Liens.
Neither the Borrower nor any Significant Subsidiary thereof will create
or assume or permit to exist any Lien in respect of any property or assets of
any kind (real or personal, tangible or intangible) of the Borrower or any such
Significant Subsidiary, or sell any such property or assets subject to an
understanding or agreement, contingent or otherwise, to repurchase such property
or assets, or sell, or permit any Significant Subsidiary thereof to sell, any
accounts receivable; provided that the provisions of this Section shall not
prevent or restrict the creation, assumption or existence of:
(a) any Lien in respect of any such property or assets of any
Significant Subsidiary of the Borrower to secure indebtedness
owing by it to the Borrower or any Wholly Owned Subsidiary of
the Borrower; or
(b) Liens (including capital leases) in respect of property
acquired by the Borrower or any Significant Subsidiary
thereof, to secure the purchase price, or the cost of
construction and development, of such property (or to secure
indebtedness incurred prior to, at the time of, or within 120
days after the later of the acquisition of such property and
the commencement of operation of such property for the purpose
of financing the acquisition, or the cost of construction and
development, of such property), or Liens existing on any such
property at the time of acquisition of such property by the
Borrower or such Significant Subsidiary, whether or not
assumed, or any Lien in respect of property of any person
existing at the time such person becomes a Subsidiary of the
Borrower; or agreements to acquire any property or assets
under conditional sale agreements or other title retention
agreements, or capital leases in respect of any other
property; provided, that
(A) the aggregate principal amount of Indebtedness secured by all
Liens in respect of any such property shall not exceed the
cost (as determined by the board of directors or analogous
governing body of the Borrower or such Significant Subsidiary,
as the case may be) of such property at the time of
acquisition thereof (or (x) in the case of property covered by
a capital lease, the fair market value, as so determined, of
such property at the time of such transaction, or (y) in the
case of a Lien in respect of property existing at the time
such person becomes a Subsidiary of the Borrower the fair
market value, as so determined of such property at such time),
and
36
(B) at the time of the acquisition of the property by the Borrower
or such Significant Subsidiary, or at the time such person
becomes a Subsidiary of the Borrower, as the case may be,
every such Lien shall apply and attach only to the property
originally subject thereto and fixed improvements constructed
thereon; or
(c) refundings or extensions of any Lien permitted in the foregoing
paragraph (b) for amounts not exceeding the principal amount of the Indebtedness
so refunded or extended or the fair market value (as determined by the board of
directors (or analogous governing body) of the Borrower or such Significant
Subsidiary, as the case may be) of the property theretofore subject to such
Lien, whichever shall be lower, in each case at the time of such refunding or
extension; provided, that such Lien shall apply only to the same property
theretofore subject to the same and fixed improvements constructed thereon; or
(d) sales subject to understandings or agreements to repurchase; provided
that the aggregate sales price for all such sales (other than sales to any
governmental instrumentality in connection with such instrumentality's issuance
of indebtedness, including without limitation industrial development bonds and
pollution control bonds, on behalf of the Borrower or any Significant Subsidiary
thereof) made in any one calendar year shall not exceed $50,000,000 in the
aggregate for the Borrower and its Significant Subsidiaries; or
(e) any production payment or similar interest that is dischargeable solely
out of natural gas, coal, lignite, oil or other mineral to be produced from the
property subject thereto and to be sold or delivered by the Borrower or any
Significant Subsidiary thereof; or
(f) any Lien, including in connection with sale-leaseback transactions,
created or assumed by the Borrower or any Significant Subsidiary thereof on
natural gas, coal, lignite, oil or other mineral properties or nuclear fuel
owned or leased by the Borrower or such Subsidiary, to secure loans to the
Borrower or such Subsidiary in an aggregate amount not to exceed $400,000,000 in
the aggregate for the Borrower and its Significant Subsidiaries; provided, that
neither the Borrower nor any other Subsidiary of the Borrower shall assume or
guarantee such financings; or
(g) any Lien (whenever incurred) on assets owned by the Borrower or any
Subsidiary thereof as of July 31, 2002 and any fuel, operating and maintenance
or similar contract related thereto securing Indebtedness of the Borrower or
such Subsidiary in an aggregate amount not to exceed 10% of consolidated assets
of the Borrower; or
(h) leases (other than capital leases) now or hereafter existing and any
renewals and extensions thereof under which the Borrower or any Significant
Subsidiary thereof may acquire or dispose of any of its property, subject,
however, to the terms of Section 5.09; or
(i) any Lien created or to be created by the First Mortgage; or
37
(j) any Lien on the rights of TXU Mining or TXU Fuel existing under their
respective Operating Agreements; or
(k) pledges or sales by the Borrower or any Subsidiary of the Borrower of
its accounts receivable including customers' installment paper; or
(l) the pledge of current assets, in the ordinary course of business, to
secure current liabilities; or
(m) Permitted Encumbrances; or
(n) the Liens in favor of the agent under the Facility B Credit Agreement
on funds in the "Cash Collateral Account" (under and as defined in the Facility
B Credit Agreement) and on such "Cash Collateral Account" to secure the
reimbursement obligations of the Borrower in respect of "Letters of Credit"
issued under, and as defined in, the Facility B Credit Agreement and comparable
Liens created to secure reimbursement obligations for other letters of credit
issued for the account of the Borrower or any of its Subsidiaries; or
(o) any Lien incurred in connection with the issuance of Qualified
Transition Bonds.
SECTION 5.11. Fixed Charge Coverage.
The Borrower will not, as of the end of each quarter of each fiscal
year of the Borrower, permit Consolidated Earnings Available for Fixed Charges
for the twelve months then ended to be less than or equal to 200% of
Consolidated Fixed Charges for the twelve months then ended.
SECTION 5.12. Equity Capitalization Ratio.
The Borrower will not, as of the end of each quarter of each fiscal
year of the Borrower, permit the ratio of its Consolidated Shareholders' Equity
to its Consolidated Total Capitalization to be less than 35%.
SECTION 5.13. Restrictive Agreements.
The Borrower will not allow either Energy or Oncor to enter into any
agreement restricting the ability of Energy or Oncor to make payments, directly
or indirectly, to the Borrower by way of dividends, advances, repayments of
loans or advances, reimbursements of management and other intercompany charges,
expenses and accruals or other returns on investments or any other agreement or
arrangement that restricts the ability of Energy or Oncor to make any payment,
directly or indirectly, to the Borrower, other than pursuant to the terms of
preferred stock or Equity-Credit Preferred Securities issued by Energy or Oncor
or their respective Subsidiaries, if the effect of such agreement is to subject
Energy or Oncor or any of their respective Subsidiaries to restrictions on such
payments greater than those to which such Subsidiary was subject on July 31,
2002. All such agreements to which Energy or Oncor was a party on July 31, 2002
are listed in Schedule 5.13 hereto.
38
Article VI
EVENTS OF DEFAULT
In case of the happening of any of the following events (each an "Event
of Default"):
(a) any representation or warranty made or deemed made by the Borrower in
or in connection with the execution and delivery of this Agreement or the
Borrowings hereunder shall prove to have been false or misleading in any
material respect when so made, deemed made or furnished;
(b) default shall be made by the Borrower in the payment of any principal
of any Loan when and as the same shall become due and payable, whether at the
due date thereof or at a date fixed for prepayment thereof or by acceleration
thereof or otherwise;
(c) default shall be made by the Borrower in the payment of any interest on
any Loan or any Fee or any other amount (other than an amount referred to in
paragraph (b) above) due hereunder, when and as the same shall become due and
payable, and such default shall continue unremedied for a period of five days;
(d) default shall be made by the Borrower in the due observance or
performance of any covenant, condition or agreement contained in Section 5.01,
5.11 or 5.12;
(e) default shall be made by the Borrower (i) in the due observance or
performance of any covenant, condition or agreement contained in Section 5.09
and such default shall continue unremedied for a period of 5 days or (ii) in the
due observance or performance of any covenant, condition or agreement contained
herein (other than those specified in (b), (c), (d) or (e)(i) above) and such
default shall continue unremedied for a period of 30 days after notice thereof
from the Agent at the request of any Lender to the Borrower;
(f) TXU shall no longer own, directly or indirectly, all the outstanding
common stock in the Borrower or any permitted successor to the Borrower or the
Borrower shall no longer own, directly or indirectly, 100% of the common stock
of Oncor or common members' interest in Energy; provided, however, that the
Borrower and Energy may sell in an initial public offering up to 20% of the
equity interests in any Subsidiary comprising generating assets of Energy;
(g) the Borrower or any Subsidiary thereof shall (i) fail to pay any
principal or interest, regardless of amount, due in respect of any Indebtedness
in a principal amount in excess of $50,000,000, when and as the same shall
become due and payable, subject to any applicable grace periods, or (ii) fail to
observe or perform any other term, covenant, condition or agreement contained in
any agreement or instrument evidencing or governing any such Indebtedness if the
effect of any failure referred to in this clause (ii) is to cause, or to permit
the holder or holders of such Indebtedness or a trustee on its or their behalf
to cause, such Indebtedness to become due prior to its stated maturity;
(h) an involuntary proceeding shall be commenced or an involuntary petition
shall be filed in a court of competent jurisdiction seeking (i) relief in
respect of the Borrower or any Significant Subsidiary, or of a substantial part
of the property or assets of the Borrower or any Significant Subsidiary, under
Title 11 of the United States Bankruptcy Code, as now constituted or hereafter
39
amended, or any other Federal or state bankruptcy, insolvency, receivership or
similar law, (ii) the appointment of a receiver, trustee, custodian,
sequestrator, conservator or similar official for the Borrower or any
Significant Subsidiary or for a substantial part of the property or assets of
the Borrower or any Significant Subsidiary or (iii) the winding up or
liquidation of the Borrower or any Significant Subsidiary; and such proceeding
or petition shall continue undismissed for 60 days or an order or decree
approving or ordering any of the foregoing shall be entered;
(i) the Borrower or any Significant Subsidiary shall (i) voluntarily
commence any proceeding or file any petition seeking relief under Title 11 of
the United States Bankruptcy Code, as now constituted or hereafter amended, or
any other Federal or state bankruptcy, insolvency, receivership or similar law,
(ii) consent to the institution of, or fail to contest in a timely and
appropriate manner, any proceeding or the filing of any petition described in
(h) above, (iii) apply for or consent to the appointment of a receiver, trustee,
custodian, sequestrator, conservator or similar official for the Borrower or any
Significant Subsidiary or for a substantial part of the property or assets of it
or such Significant Subsidiary, (iv) file an answer admitting the material
allegations of a petition filed against it in any such proceeding, (v) make a
general assignment for the benefit of creditors, (vi) become unable, admit in
writing its inability or fail generally to pay its debts as they become due or
(vii) take any action for the purpose of effecting any of the foregoing;
(j) a Change in Control shall occur;
(k) one or more judgments or orders for the payment of money in an
aggregate amount in excess of $50,000,000 shall be rendered against the Borrower
or any Subsidiary thereof or any combination thereof and such judgment or order
shall remain undischarged or unstayed for a period of 30 days, or any action
shall be legally taken by a judgment creditor to levy upon assets or properties
of the Borrower or any Subsidiary to enforce any such judgment or order; or
(l) an ERISA Event or ERISA Events shall have occurred that reasonably
could be expected to result in a Material Adverse Change;
then, and in every such event, and at any time thereafter during the continuance
of such event, the Agent, at the request of the Required Lenders, shall, by
notice to the Borrower, take either or both of the following actions, at the
same or different times: (i) terminate forthwith the right of the Borrower to
borrow pursuant to the Commitments and (ii) declare the Loans of the Borrower
then outstanding to be forthwith due and payable in whole or in part, whereupon
the principal of the Loans so declared to be due and payable, together with
accrued interest thereon and any unpaid accrued Fees and all other liabilities
of the Borrower accrued hereunder, shall become forthwith due and payable,
without presentment, demand, protest or any other notice of any kind, all of
which are hereby expressly waived, anything contained herein to the contrary
notwithstanding; provided that in the case of any event described in paragraph
(h) or (i) above with respect to the Borrower, the Commitments of the Lenders
shall automatically terminate and the principal of the Loans then outstanding,
together with accrued interest thereon and any unpaid accrued Fees and all other
liabilities of the Borrower accrued hereunder shall automatically become due and
payable, without presentment, demand, protest or any other notice of any kind,
all of which are hereby expressly waived by the Borrower, anything contained
herein to the contrary notwithstanding.
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Article VII
THE AGENT
In order to expedite the transactions contemplated by this Agreement,
Citibank is hereby appointed to act as Agent on behalf of the Lenders. Each of
the Lenders hereby irrevocably authorizes the Agent to take such actions on
behalf of such Lender and to exercise such powers as are specifically delegated
to the Agent by the terms and provisions hereof, together with such actions and
powers as are reasonably incidental thereto. The Agent is hereby expressly
authorized by the Lenders, without hereby limiting any implied authority, (i) to
receive on behalf of the Lenders all payments of principal of and interest on
the Loans and all other amounts due to the Lenders hereunder, and promptly to
distribute to each Lender its proper share of each payment so received, (ii) to
give notice on behalf of each of the Lenders to the Borrower of any Event of
Default of which the Agent has actual knowledge acquired in connection with its
agency hereunder, and (iii) to distribute to each Lender copies of all notices,
financial statements and other materials delivered by the Borrower pursuant to
this Agreement as received by the Agent.
None of the Agent or any of its directors, officers, employees or
agents shall be liable as such for any action taken or omitted by any of them
except for its or his or her own gross negligence or willful misconduct, or be
responsible for any statement, warranty or representation herein or the contents
of any document delivered in connection herewith, or be required to ascertain or
to make any inquiry concerning the performance or observance by the Borrower of
any of the terms, conditions, covenants or agreements contained in this
Agreement. The Agent shall not be responsible to the Lenders for the due
execution, genuineness, validity, enforceability or effectiveness of this
Agreement or other instruments or agreements. The Agent may deem and treat the
Lender that makes any Loan as the holder of the indebtedness resulting therefrom
for all purposes hereof until it shall have received notice from such Lender,
given as provided herein, of the transfer thereof. The Agent shall in all cases
be fully protected in acting, or refraining from acting, in accordance with
written instructions signed by the Required Lenders and, except as otherwise
specifically provided herein, such instructions and any action or inaction
pursuant thereto shall be binding on all the Lenders. The Agent shall, in the
absence of knowledge to the contrary, be entitled to rely on any instrument or
document believed by it in good faith to be genuine and correct and to have been
signed or sent by the proper person or persons. None of the Agent or any of its
directors, officers, employees or agents shall have any responsibility to the
Borrower on account of the failure of or delay in performance or breach by any
Lender of any of its obligations hereunder or to any Lender on account of the
failure of or delay in performance or breach by any other Lender or the Borrower
of any of their respective obligations hereunder or in connection herewith. The
Agent may execute any and all duties hereunder by or through agents or employees
and shall be entitled to rely upon the advice of legal counsel selected by it
with respect to all matters arising hereunder and shall not be liable for any
action taken or suffered in good faith by it in accordance with the advice of
such counsel.
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The Lenders hereby acknowledge that the Agent shall not be under any
duty to take any discretionary action permitted to be taken by it pursuant to
the provisions of this Agreement unless it shall be requested in writing to do
so by the Required Lenders.
Subject to the appointment and acceptance of a successor Agent as
provided below, the Agent may resign at any time by notifying the Lenders and
the Borrower. Upon any such resignation, the Required Lenders shall have the
right to appoint a successor Agent acceptable to the Borrower. If no successor
shall have been so appointed by the Required Lenders and shall have accepted
such appointment within 30 days after the retiring Agent gives notice of its
resignation, then the retiring Agent may, on behalf of the Lenders, appoint a
successor Agent, having a combined capital and surplus of at least $500,000,000
or an Affiliate of any such bank. Upon the acceptance of any appointment as
Agent hereunder by a successor bank, such successor shall succeed to and become
vested with all the rights, powers, privileges and duties of the retiring Agent
and the retiring Agent shall be discharged from its duties and obligations
hereunder. After the Agent's resignation hereunder, the provisions of this
Article and Section 8.05 shall continue in effect for its benefit in respect of
any actions taken or omitted to be taken by it while it was acting as Agent.
With respect to the Loans made by it hereunder, Citibank, in its
individual capacity and not as the Agent, shall have the same rights and powers
as any other Lender and may exercise the same as though it were not the Agent,
and the Agent and its Affiliates may accept deposits from, lend money to and
generally engage in any kind of business with the Borrower or any Subsidiary or
other Affiliate thereof as if it were not an Agent.
Each Lender agrees (i) to reimburse the Agent, on demand, in the amount
of its pro rata share (based on its Commitment hereunder or, if the Commitments
shall have been terminated, the amount of its outstanding Loans) of any expenses
incurred for the benefit of the Lenders in its role as Agent, including counsel
fees and compensation of agents and employees paid for services rendered on
behalf of the Lenders, which shall not have been reimbursed by the Borrower and
(ii) to indemnify and hold harmless the Agent and any of its directors,
officers, employees or agents, on demand, in the amount of such pro rata share,
from and against any and all liabilities, taxes, obligations, losses, damages,
penalties, actions, judgments, suits, costs, expenses or disbursements of any
kind or nature whatsoever that may be imposed on, incurred by or asserted
against it in any way relating to or arising out of this Agreement or any action
taken or omitted by it under this Agreement to the extent the same shall not
have been reimbursed by the Borrower; provided that no Lender shall be liable to
the Agent for any portion of such liabilities, obligations, losses, damages,
penalties, actions, judgments, suits, costs, expenses or disbursements resulting
from the gross negligence or willful misconduct of the Agent or any of its
directors, officers, employees or agents.
Each Lender acknowledges that it has, independently and without
reliance upon the Agent or any other Lender and based on such documents and
information as it has deemed appropriate, made its own credit analysis and
decision to enter into this Agreement. Each Lender also acknowledges that it
will, independently and without reliance upon the Agent or any other Lender and
based on such documents and information as it shall from time to time deem
appropriate, continue to make its own decisions in taking or not taking action
under or based upon this Agreement or any related agreement or any document
furnished hereunder or thereunder.
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NEITHER CITIGROUP GLOBAL MARKETS, INC., BY VIRTUE OF ITS DESIGNATION AS
"LEAD ARRANGER" ON THE COVER PAGE OF THIS AGREEMENT, NOR BANC OF AMERICA
SECURITIES, LLC OR CREDIT SUISSE FIRST BOSTON, BY VIRTUE OF ITS DESIGNATION AS A
"CO-SYNDICATION AGENT" ON THE COVER PAGE OF THIS AGREEMENT, NOR COMMERZBANK AG,
NEW YORK AND CAYMAN ISLAND BRANCHES OR SUMITOMO MITSUI BANKING CORPORATION, BY
VIRTUE OF ITS DESIGNATION AS A "CO-DOCUMENTATION AGENT" ON THE COVERAGE PAGE OF
THIS AGREEMENT, SHALL HAVE ANY DUTIES, LIABILITIES, OBLIGATIONS OR
RESPONSIBILITIES UNDER THIS AGREEMENT.
Article VIII
MISCELLANEOUS
SECTION 8.01. Notices.
Notices and other communications provided for herein shall be in
writing and shall be delivered by hand or overnight courier service, mailed or
sent by telecopy, as follows:
(a) if to the Borrower, to TXU Business Services Company, Energy Plaza,
▇▇▇▇ ▇▇▇▇▇ ▇▇▇▇▇▇, ▇▇▇▇ ▇▇▇▇▇, ▇▇▇▇▇▇, ▇▇ ▇▇▇▇▇, Attention: Treasurer (Telecopy
No. 214-812-2488);
(b) if to the Agent, to Citibank, N.A., ▇▇▇ ▇▇▇▇▇ ▇▇▇, ▇▇▇▇▇ ▇▇▇, ▇▇▇
▇▇▇▇▇▇, ▇▇▇▇▇▇▇▇ ▇▇▇▇▇, Attention: Bank Loan Syndications; and
(c) if to a Lender, to it at its address (or telecopy number) set forth in
the Register or in the Assignment and Acceptance pursuant to which such Lender
became a party hereto.
All notices and other communications given to any party hereto in accordance
with the provisions of this Agreement shall be deemed to have been given on the
date of receipt if delivered by hand or overnight courier service or sent by
telecopy to such party as provided in this Section or in accordance with the
latest unrevoked direction from such party given in accordance with this
Section.
SECTION 8.02. Survival of Agreement.
All covenants, agreements, representations and warranties made by the
Borrower herein and in the certificates or other instruments prepared or
delivered in connection with or pursuant to this Agreement shall be considered
to have been relied upon by the Lenders and shall survive the making by the
Lenders of the Loans regardless of any investigation made by the Lenders or on
their behalf, and shall continue in full force and effect as long as the
principal of or any accrued interest on any Loan or any Fee or any other amount
payable under this Agreement is outstanding and unpaid or the Commitments have
not been terminated.
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SECTION 8.03. Binding Effect.
This Agreement shall become effective on the Restatement Date, and
thereafter shall be binding upon and inure to the benefit of the parties hereto
and their respective successors and assigns, except that the Borrower shall not
have the right to assign any rights hereunder or any interest herein without the
prior consent of all the Lenders.
SECTION 8.04. Successors and Assigns.
(a) Whenever in this Agreement any of the parties hereto is referred to,
such reference shall be deemed to include the successors and assigns of such
party; and all covenants, promises and agreements by or on behalf of any party
that are contained in this Agreement shall bind and inure to the benefit of its
successors and assigns.
(b) Each Lender may assign to one or more assignees all or a portion of its
interests, rights and obligations under this Agreement (including all or a
portion of its Commitment and the Loans at the time owing to it); provided,
however, that (i) except in the case of an assignment to a Lender or an
Affiliate of such Lender, an assignment to a Federal Reserve Bank or an
assignment made at any time an Event of Default shall have occurred and be
continuing, the Borrower and the Agent must give their prior written consent to
such assignment (which consent shall not be unreasonably withheld), (ii) the
amount of the Commitment of the assigning Lender subject to each such assignment
(determined as of the date the Assignment and Acceptance with respect to such
assignment is delivered to the Agent) shall not be less than $5,000,000 or, if
the amount of the Commitment of the assigning Lender is less than $5,000,000,
the aggregate amount of such Lender's Commitment, (iii) each such assignment
shall be of a constant, and not a varying, percentage of all the assigning
Lender's rights and obligations under this Agreement, and (iv) the parties to
each such assignment shall execute and deliver to the Agent an Assignment and
Acceptance, and a processing and recordation fee of $3,500. Upon acceptance and
recording pursuant to Section 8.04(e), from and after the effective date
specified in each Assignment and Acceptance, which effective date shall be at
least five Business Days after the execution thereof unless otherwise agreed by
the Agent (the Borrower to be given reasonable notice of any shorter period),
(A) the assignee thereunder shall be a party hereto and, to the extent of the
interest assigned by such Assignment and Acceptance, have the rights and
obligations of a Lender under this Agreement and (B) the assigning Lender
thereunder shall, to the extent of the interest assigned by such Assignment and
Acceptance, be released from its obligations under this Agreement (and, in the
case of an Assignment and Acceptance covering all or the remaining portion of an
assigning Lender's rights and obligations under this Agreement, such Lender
shall cease to be a party hereto (but shall continue to be entitled to the
benefits of Sections 2.11, 2.16 and 8.05 afforded to such Lender prior to its
assignment as well as to any Fees accrued for its account hereunder and not yet
paid).
(c) By executing and delivering an Assignment and Acceptance, the assigning
Lender thereunder and the assignee thereunder shall be deemed to confirm to and
agree with each other and the other parties hereto as follows: (i) such
assigning Lender warrants that it is the legal and beneficial owner of the
interest being assigned thereby free and clear of any adverse claim; (ii) except
as set forth in (i) above, such assigning Lender makes no representation or
warranty and assumes no responsibility with respect to any statements,
warranties or representations made in or in connection with this Agreement, or
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the execution, legality, validity, enforceability, genuineness, sufficiency or
value of this Agreement or any other instrument or document furnished pursuant
hereto or the financial condition of the Borrower or the performance or
observance by the Borrower of any obligations under this Agreement or any other
instrument or document furnished pursuant hereto; (iii) such assignor and such
assignee represents and warrants that it is legally authorized to enter into
such Assignment and Acceptance; (iv) such assignee confirms that it has received
a copy of this Agreement, together with copies of the most recent financial
statements delivered pursuant to Section 5.03 and such other documents and
information as it has deemed appropriate to make its own credit analysis and
decision to enter into such Assignment and Acceptance; (v) such assignee will
independently and without reliance upon the Agent, such assigning Lender or any
other Lender and based on such documents and information as it shall deem
appropriate at the time, continue to make its own credit decisions in taking or
not taking action under this Agreement; (vi) such assignee appoints and
authorizes the Agent to take such action as agent on its behalf and to exercise
such powers under this Agreement as are delegated to the Agent by the terms
hereof, together with such powers as are reasonably incidental thereto; and
(vii) such assignee agrees that it will perform in accordance with their terms
all the obligations which by the terms of this Agreement are required to be
performed by it as a Lender.
(d) The Agent shall maintain at one of its offices in the City of New York
a copy of each Assignment and Acceptance delivered to it and a register for the
recordation of the names and addresses of the Lenders, and the Commitment of,
and the principal amount of the Loans owing to, each Lender pursuant to the
terms hereof from time to time (the "Register"). The entries in the Register
shall be conclusive in the absence of manifest error and the Borrower, the Agent
and the Lenders may treat each person whose name is recorded in the Register
pursuant to the terms hereof as a Lender hereunder for all purposes of this
Agreement. The Register shall be available for inspection by each party hereto,
at any reasonable time and from time to time upon reasonable prior notice.
(e) Upon its receipt of a duly completed Assignment and Acceptance executed
by an assigning Lender and an assignee, the processing and recordation fee
referred to in paragraph (b) above and, if required, the written consent of the
Borrower and the Agent to such assignment, the Agent shall (i) accept such
Assignment and Acceptance and (ii) record the information contained therein in
the Register.
(f) Each Lender may, without the consent of the Borrower or the Agent, sell
participations to one or more banks or other entities in all or a portion of its
rights and/or obligations under this Agreement (including all or a portion of
its Commitment and the Loans owing to it); provided, however, that (i) such
Lender's obligations under this Agreement shall remain unchanged, (ii) such
Lender shall remain solely responsible to the other parties hereto for the
performance of such obligations, (iii) each participating bank or other entity
shall be entitled to the benefit of the cost protection provisions contained in
Sections 2.11, 2.16 and 8.05 to the same extent as if it were the selling Lender
(and limited to the amount that could have been claimed by the selling Lender
had it continued to hold the interest of such participating bank or other
entity), except that all claims made pursuant to such Sections shall be made
through such selling Lender, and (iv) the Borrower, the Agent and the other
Lenders shall continue to deal solely and directly with such selling Lender in
connection with such Lender's rights and obligations under this Agreement, and
45
such Lender shall retain the sole right to enforce the obligations of the
Borrower under this Agreement and to approve any amendment, modification or
waiver of any provision of this Agreement (other than amendments, modifications
or waivers (x) decreasing any fees payable hereunder or the amount of principal
of, or the rate at which interest is payable on, the Loans, (y) extending any
scheduled principal payment date or date fixed for the payment of interest on
the Loans or (z) extending the Commitments).
(g) Any Lender or participant may, in connection with any assignment or
participation or proposed assignment or participation pursuant to this Section,
disclose to the assignee or participant or proposed assignee or participant any
information relating to the Borrower furnished to such Lender by or on behalf of
the Borrower; provided that, prior to any such disclosure, each such assignee or
participant or proposed assignee or participant shall execute an agreement
whereby such assignee or participant shall agree (subject to customary
exceptions) to preserve the confidentiality of any such information.
(h) The Borrower shall not assign or delegate any rights and duties
hereunder without the prior written consent of all Lenders, and any attempted
assignment or delegation (except as a consequence of a transaction expressly
permitted under Section 5.09) by the Borrower without such consent shall be
void.
(i) Any Lender may at any time pledge all or any portion of its rights
under this Agreement to a Federal Reserve Bank; provided that no such pledge
shall release any Lender from its obligations hereunder or substitute any such
Bank for such Lender as a party hereto. In order to facilitate such an
assignment to a Federal Reserve Bank, the Borrower shall, at the request of the
assigning Lender, duly execute and deliver to the assigning Lender a promissory
note or notes evidencing the Loans made to the Borrower by the assigning Lender
hereunder.
SECTION 8.05. Expenses; Indemnity.
(a) The Borrower agrees to pay all reasonable out-of-pocket expenses
(including reasonable fees, charges and disbursements of counsel) incurred by
the Agent in connection with entering into this Agreement or in connection with
any amendments, modifications or waivers of the provisions hereof (but only if
such amendments, modifications or waivers are requested by the Borrower)
(whether or not the transactions hereby contemplated are consummated), or
incurred by the Agent or any Lender in connection with the enforcement of its
rights in connection with this Agreement or in connection with the Loans made
hereunder, including the reasonable fees and disbursements of counsel for the
Agent and, in the case of enforcement following an Event of Default, the
Lenders.
(b) The Borrower agrees to indemnify each Lender against any loss,
calculated in accordance with the next sentence, or reasonable expense which
such Lender may sustain or incur as a consequence of (i) any failure by the
Borrower to borrow or to refinance, convert or continue any Loan hereunder
(including as a result of the Borrower's failure to fulfill any of the
applicable conditions set forth in Article IV) after irrevocable notice of such
borrowing, refinancing, conversion or continuation has been given pursuant to
Section 2.03, (ii) any payment, prepayment or conversion, or assignment of a
Eurodollar Loan required by any provision of this Agreement or otherwise made or
deemed made on a date other than the last day of the Interest Period, if any,
46
applicable thereto, (iii) any default in payment or prepayment of the principal
amount of any Loan or any part thereof or interest accrued thereon, as and when
due and payable (at the due date thereof, whether by scheduled maturity,
acceleration, irrevocable notice of prepayment or otherwise) or (iv) the
occurrence of any Event of Default, including, in each such case, any loss or
reasonable expense sustained or incurred or to be sustained or incurred by such
Lender in liquidating or employing deposits from third parties, or with respect
to commitments made or obligations undertaken with third parties, to effect or
maintain any Loan hereunder or any part thereof as a Eurodollar Loan. Such loss
shall include an amount equal to the excess, if any, as reasonably determined by
such Lender, of (x) its cost of obtaining the funds for the Loan being paid,
prepaid, refinanced, converted or not borrowed (assumed to be the LIBO Rate) for
the period from the date of such payment, prepayment, refinancing or failure to
borrow or refinance to the last day of the Interest Period for such Loan (or, in
the case of a failure to borrow or refinance the Interest Period for such Loan
that would have commenced on the date of such failure) over (y) the amount of
interest (as reasonably determined by such Lender) that would be realized by
such Lender in reemploying the funds so paid, prepaid or not borrowed or
refinanced for such period or Interest Period, as the case may be.
(c) The Borrower agrees to indemnify the Agent, the Joint Lead Arrangers,
each Lender, each of their Affiliates and the directors, officers, employees and
agents of the foregoing (each such person being called an "Indemnitee") against,
and to hold each Indemnitee harmless from, any and all losses, claims, damages,
liabilities and related expenses, including reasonable counsel fees and
expenses, incurred by or asserted against any Indemnitee arising out of (i) the
preparation, execution, delivery, enforcement, performance and administration of
this Agreement, (ii) the use of the proceeds of the Loans or (iii) any claim,
litigation, investigation or proceeding relating to any of the foregoing,
whether or not any Indemnitee is a party thereto, including any of the foregoing
arising from the negligence, whether sole or concurrent, on the part of any
Indemnitee; provided that such indemnity shall not, as to any Indemnitee, be
available to the extent that such losses, claims, damages, liabilities or
related expenses (A) are determined by a final judgment of a court of competent
jurisdiction to have resulted from the gross negligence or willful misconduct of
such Indemnitee or (B) result from any litigation brought by such Indemnitee
against the Borrower or by the Borrower against such Indemnitee, in which a
final, nonappealable judgment has been rendered against such Indemnitee;
provided, further, that the Borrower agrees that it will not, nor will it permit
any Subsidiary to, without the prior written consent of each Indemnitee, settle,
compromise or consent to the entry of any judgment in any pending or threatened
claim, action, suit or proceeding in respect of which indemnification could be
sought under the indemnification provisions of this Section 8.05(c) (whether or
not any Indemnitee is an actual or potential party to such claim, action, suit
or proceeding), unless such settlement, compromise or consent does not include
any statement as to an admission of fault, culpability or failure to act by or
on behalf of any Indemnitee and does not involve any payment of money or other
value by any Indemnitee or any injunctive relief or factual findings or
stipulations binding on any Indemnitee.
(d) The provisions of this Section shall remain operative and in full force
and effect regardless of the expiration of the term of this Agreement, the
consummation of the transactions contemplated hereby, the repayment of any of
the Loans, the invalidity or unenforceability of any term or provision of this
Agreement or any investigation made by or on behalf of the Agent or any Lender.
All amounts due under this Section shall be payable on written demand therefor.
47
(e) A certificate of any Lender or the Agent setting forth any amount or amounts
which such Lender or the Agent is entitled to receive pursuant to paragraph (b)
of this Section and containing an explanation in reasonable detail of the manner
in which such amount or amounts shall have been determined shall be delivered to
the Borrower and shall be conclusive absent manifest error.
SECTION 8.06. Right of Setoff.
If an Event of Default shall have occurred and be continuing, each
Lender is hereby authorized at any time and from time to time, to the fullest
extent permitted by law, to set off and apply any and all deposits (general or
special, time or demand, provisional or final) at any time held and other
indebtedness at any time owing by such Lender to or for the credit or the
account of the Borrower against any and all of the obligations of the Borrower
now or hereafter existing under this Agreement held by such Lender, irrespective
of whether or not such Lender shall have made any demand under this Agreement
and although such obligations may be unmatured. The rights of each Lender under
this Section are in addition to other rights and remedies (including other
rights of setoff) which such Lender may have.
SECTION 8.07. Applicable Law.
THIS AGREEMENT SHALL BE CONSTRUED IN ACCORDANCE WITH AND GOVERNED BY
THE LAWS OF THE STATE OF NEW YORK.
SECTION 8.08. Waivers; Amendment.
(a) No failure or delay of the Agent or any Lender in exercising any power
or right hereunder shall operate as a waiver thereof, nor shall any single or
partial exercise of any such right or power, or any abandonment or
discontinuance of steps to enforce such a right or power, preclude any other or
further exercise thereof or the exercise of any other right or power. The rights
and remedies of the Agent and the Lenders hereunder are cumulative and are not
exclusive of any rights or remedies which they would otherwise have. No waiver
of any provision of this Agreement or consent to any departure therefrom shall
in any event be effective unless the same shall be permitted by paragraph (b)
below, and then such waiver or consent shall be effective only in the specific
instance and for the purpose for which given. No notice or demand on the
Borrower or any Subsidiary in any case shall entitle such party to any other or
further notice or demand in similar or other circumstances.
(b) Neither this Agreement nor any provision hereof may be waived, amended
or modified except pursuant to an agreement or agreements in writing entered
into by the Borrower and the Required Lenders; provided, however, that no such
agreement shall (i) decrease the principal amount of, or extend the maturity of
or any scheduled principal payment date or date for the payment of any interest
on any Loan or the date for the payment of any Facility Fee, or waive or excuse
any such payment or any part thereof, or decrease the rate of interest on any
Loan, without the prior written consent of each Lender affected thereby, (ii)
increase the Commitment of any Lender, decrease the Facility Fee of any Lender
without the prior written consent of such Lender, or (iii) amend or modify the
provisions of Section 2.13, 2.14 or Section 8.04(h), the provisions of this
Section or the definition of the "Required Lenders", without the prior written
48
consent of each Lender; provided further, however, that no such agreement shall
amend, modify or otherwise affect the rights or duties of the Agent hereunder
without the prior written consent of the Agent. Each Lender shall be bound by
any waiver, amendment or modification authorized by this Section and any consent
by any Lender or the Agent pursuant to this Section shall bind any assignee of
its rights and interests hereunder.
SECTION 8.09. Entire Agreement.
This Agreement (including the schedules and exhibits hereto) represent
the entire contract among the parties relative to the subject matter hereof and
thereof. Any previous agreement, whether written or oral, among the parties with
respect to the subject matter hereof, including, without limitation, the
Original Agreement, is superseded by this Agreement. There are no unwritten oral
agreements between the parties. Nothing in this Agreement, expressed or implied,
is intended to confer upon any party other than the parties hereto any rights,
remedies, obligations or liabilities under or by reason of this Agreement.
SECTION 8.10. Severability.
In the event any one or more of the provisions contained in this
Agreement should be held invalid, illegal or unenforceable in any respect, the
validity, legality and enforceability of the remaining provisions contained
herein shall not in any way be affected or impaired thereby. The parties shall
endeavor in good-faith negotiations to replace the invalid, illegal or
unenforceable provisions with valid provisions the economic effect of which
comes as close as possible to that of the invalid, illegal or unenforceable
provisions.
SECTION 8.11. Counterparts.
This Agreement may be executed in two or more counterparts, each of
which shall constitute an original but all of which when taken together shall
constitute but one contract, and shall become effective as provided in Section
8.03.
SECTION 8.12. Headings.
Article and Section headings and the Table of Contents used herein are
for convenience of reference only, are not part of this Agreement and are not to
affect the construction of, or to be taken into consideration in interpreting,
this Agreement.
SECTION 8.13. Interest Rate Limitation.
(a) Notwithstanding anything herein to the contrary, if at any time the
applicable interest rate, together with all fees and charges that are treated as
interest under applicable law (collectively the "Charges"), as provided for
herein or in any other document executed in connection herewith, or otherwise
contracted for, charged, received, taken or reserved by any Lender, shall exceed
the maximum lawful rate (the "Maximum Rate") which may be contracted for,
charged, taken, received or reserved by such Lender in accordance with
applicable law, the rate of interest payable on the Loans of such Lender,
together with all Charges payable to such Lender, shall be limited to the
Maximum Rate.
49
(b) If the amount of interest, together with all Charges, payable for the
account of any Lender in respect of any interest computation period is reduced
pursuant to paragraph (a) of this Section and the amount of interest, together
with all Charges, payable for such Lender's account in respect of any subsequent
interest computation period, computed pursuant to Section 2.06, would be less
than the Maximum Rate, then the amount of interest, together with all Charges,
payable for such Lender's account in respect of such subsequent interest
computation period shall, to the extent permitted by applicable law, be
automatically increased to such Maximum Rate; provided that at no time shall the
aggregate amount by which interest paid for the account of any Lender has been
increased pursuant to this paragraph (b) exceed the aggregate amount by which
interest, together with all Charges, paid for its account has theretofore been
reduced pursuant to paragraph (a) of this Section.
SECTION 8.14. Jurisdiction; Venue.
(a) The Borrower hereby irrevocably and unconditionally submits, for itself
and its property, to the nonexclusive jurisdiction of any New York State court
or Federal court of the United States of America sitting in New York City, and
any appellate court from any thereof, in any action or proceeding arising out of
or relating to this Agreement, or for recognition or enforcement of any
judgment, and each of the parties hereto hereby irrevocably and unconditionally
agrees that all claims in respect of any such action or proceeding may be heard
and determined in such New York State or, to the extent permitted by law, in
such Federal court. Each of the parties hereto agrees that a final judgment in
any such action or proceeding shall be conclusive and may be enforced in other
jurisdictions by suit on the judgment or in any other manner provided by law.
Subject to the foregoing and to paragraph (b) below, nothing in this Agreement
shall affect any right that any party hereto may otherwise have to bring any
action or proceeding relating to this Agreement against any other party hereto
in the courts of any jurisdiction.
(b) The Borrower hereby irrevocably and unconditionally waives, to the
fullest extent it may legally and effectively do so, any objection that it may
now or thereafter have to the laying of venue of any suit, action or proceeding
arising out of or relating to this Agreement in any New York State court or
Federal court of the United States of America sitting in New York City. Each of
the parties hereto hereby irrevocably waives, to the fullest extent permitted by
law, the defense of an inconvenient forum to the maintenance of such action or
proceeding in any such court.
SECTION 8.15. Confidentiality.
Each Lender shall use its best efforts to hold in confidence all
information, memoranda, or extracts furnished to such Lender (directly or
through the Agent) by the Borrower hereunder or in connection with the
negotiation hereof; provided that such Lender may disclose any such information,
memoranda or extracts (i) to its Affiliates, accountants or counsel, (ii) to any
regulatory agency having authority to examine such Lender, (iii) as required by
any legal or governmental process or otherwise by law, (iv) except as provided
in the last sentence of Section 5.03, to any person to which such Lender sells
or proposes to sell an assignment or a participation in its Loans hereunder, if
such other person agrees for the benefit of the Borrower to comply with the
provisions of this Section and (v) to the extent that such information,
50
memoranda or extracts shall be publicly available or shall have become known to
such Lender independently of any disclosure by the Borrower hereunder or in
connection with the negotiation hereof. Notwithstanding the foregoing, any
Lender may disclose the provisions of this Agreement and the amounts, maturities
and interest rates of its Loans to any purchaser or potential purchaser of such
Lender's interest in any Loan.
SECTION 8.16. Assignment, Assumption and Release.
(a) Effective on and as of the Restatement Date, the Exiting Borrower
hereby sells, assigns and transfers to the Borrower, and the Borrower hereby
accepts from the Exiting Borrower, all right, title and interest of the Exiting
Borrower in, and liabilities and obligations of the Exiting Borrower under, the
Original Agreement.
(b) Effective on and as of the Restatement Date, the Borrower hereby
unconditionally and irrevocably assumes all right, title and interest of the
Exiting Borrower in, and liabilities and obligations of the Exiting Borrower
under, the Original Agreement, including all such obligations in respect of
Loans outstanding on the Restatement Date, and in furtherance of said
assumption, the Borrower agrees that on and after the Restatement Date, the
Borrower shall be bound in all respects by all of the grants, terms, covenants,
representations, warranties and conditions of this Agreement, as if the Borrower
were named the "Borrower" under and as defined in the Original Agreement,
without further action required on the part of any party hereto or thereto. In
addition, on and after the Restatement Date, the Borrower assumes, agrees to
observe and perform, and promises to pay all obligations, duties and liabilities
of the Exiting Borrower, now or hereafter existing, arising out of, under or in
connection with, the Original Agreement (including, without limitation, the
punctual payment when due of the principal, interest and fees owing thereunder,
including all such obligations in respect of Loans outstanding on the
Restatement Date), in each case as though the Borrower were named the "Borrower"
under and as defined in the Original Agreement.
(c) Effective on and as of the Restatement Date, the Exiting Borrower shall
be released and discharged from any and all liabilities and obligations under
the Original Agreement, including all such obligations in respect of Loans
outstanding on the Restatement Date, and shall have no right, title or interest
in, or liabilities or obligations under, this Agreement.
[Signature pages follow]
S-1
IN WITNESS WHEREOF, the parties hereto have caused this Agreement to be
duly executed by their respective authorized officers as of the day and year
first above written.
TXU CORP.,
as Exiting Borrower
By /s/ ▇▇▇▇ ▇. ▇▇▇▇▇▇
------------------------------------
▇▇▇▇ ▇. ▇▇▇▇▇▇
Treasurer and Assistant Secretary
TXU US HOLDINGS COMPANY,
as Borrower
By /s/ ▇▇▇▇ ▇. ▇▇▇▇▇▇
------------------------------------
▇▇▇▇ ▇. ▇▇▇▇▇▇
Treasurer and Assistant Secretary
CITIBANK, N.A.,
as Agent and as Lender
By /s/ ▇▇▇▇▇ ▇▇▇▇▇▇
------------------------------------
Name: ▇▇▇▇▇ ▇▇▇▇▇▇
Title: Vice President
Signature Page to Amended and Restated Three Year Revolving Credit Agreement
S-2
AMARILLO NATIONAL BANK
By /s/ ▇▇▇▇ ▇▇▇▇▇▇
------------------------------------
Name: ▇▇▇▇ ▇▇▇▇▇▇
Title: Assistant Vice President
Signature Page to Amended and Restated Three Year Revolving Credit Agreement
S-3
BANK OF AMERICA, N.A.
By /s/ ▇▇▇ ▇. ▇▇▇▇▇▇▇
---------------------------------------------
Name: ▇▇▇ ▇. ▇▇▇▇▇▇▇
Title: Managing Director
Signature Page to Amended and Restated Three Year Revolving Credit Agreement
▇-▇
▇▇▇▇▇▇▇▇▇▇▇ ▇▇, ▇▇▇ ▇▇▇▇ AND GRAND CAYMAN BRANCHES
By /s/ ▇▇▇▇▇ ▇. ▇▇▇▇▇▇
---------------------------------------------
Name: ▇▇▇▇▇ ▇. ▇▇▇▇▇▇
Title: Senior Vice President & Manager
By /s/ ▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇▇▇▇▇
---------------------------------------------
Name: ▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇▇▇▇▇
Title: Senior Vice President
Signature Page to Amended and Restated Three Year Revolving Credit Agreement
S-5
CREDIT SUISSE FIRST BOSTON
By /s/ ▇▇▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇
-------------------------------------
Name: ▇▇▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇
Title: Vice President
By /s/ ▇▇▇ ▇. ▇▇▇▇▇▇
--------------------------------------
Name: ▇▇▇ ▇. ▇▇▇▇▇▇
Title: Associate
Signature Page to Amended and Restated Three Year Revolving Credit Agreement
S-6
SUMITOMO MITSUI BANKING CORPORATION
By /s/ ▇▇▇▇▇ ▇. ▇▇▇▇
---------------------------------------
Name: ▇▇▇▇▇ ▇. ▇▇▇▇
Title: Senior Vice President
Signature Page to Amended and Restated Three Year Revolving Credit Agreement
S-7
▇▇▇▇▇▇▇ ▇▇▇▇▇ CAPITAL CORPORATION
By /s/ ▇▇▇▇▇ ▇.▇. ▇▇▇▇▇▇
------------------------------------
Name: ▇▇▇▇▇ ▇.▇. ▇▇▇▇▇▇
Title: Vice President
Signature Page to Amended and Restated Three Year Revolving Credit Agreement
EXHIBIT A
Form of Borrowing Request
BORROWING REQUEST
[Date]
Citibank, N.A.,
as Agent for the Lenders referred to below
[address]
Ladies and Gentlemen:
The undersigned, TXU US Holdings Company (the "Borrower"), refers to
the Amended and Restated Three Year Revolving Credit Agreement, dated as of
April __, 2003 (as it may hereafter be amended, modified, extended or restated
from time to time, the "Agreement"), among the Borrower, TXU Corp., the lenders
listed in Schedule 2.01 thereto (the "Lenders") and Citibank, N.A., as agent for
the Lenders. Capitalized terms used herein and not otherwise defined herein
shall have the meanings assigned to such terms in the Agreement. The Borrower
hereby gives you notice pursuant to Section 2.03 of the Agreement that it
requests a Borrowing under the Agreement, and in that connection sets forth
below the terms on which such Borrowing is requested to be made:
(A) Date of Borrowing (which is a Business Day) -----------
(B) Principal amount of Borrowing1 -----------
(C) Interest rate basis2 -----------
(D) Interest Period and the last day thereof3 -----------
---------------
1 Not less than $5,000,000 (and in integral multiples of $1,000,000) or
greater than the Total Commitment then available.
2 Eurodollar Loan or ABR Loan.
3 Which shall be subject to the definition of "Interest Period" and
end not later than the Maturity Date.
2
Upon acceptance of any or all of the Loans made by the Lenders in
response to this request, the Borrower shall be deemed to have represented and
warranted that the applicable conditions to lending specified in Article IV of
the Agreement have been satisfied.
Very truly yours,
TXU US HOLDINGS COMPANY
By ---------------------------
Name:
Title:
EXHIBIT B
Form of Assignment and Acceptance
ASSIGNMENT AND ACCEPTANCE
[Date]
Reference is made to the Amended and Restated Three Year Revolving
Credit Agreement, dated as of April __, 2003 (as amended, modified, extended or
restated from time to time, the "Agreement"), among TXU US Holdings Company (the
"Borrower"), TXU Corp., the lenders listed in Schedule 2.01 thereto (the
"Lenders"), and Citibank, N.A., as agent for the Lenders. Terms defined in the
Agreement are used herein with the same meanings.
1. The Assignor hereby sells and assigns, without recourse, to the
Assignee, and the Assignee hereby purchases and assumes, without recourse, from
the Assignor, effective as of the [EFFECTIVE DATE OF ASSIGNMENT], the interests
set forth on the reverse hereof (the "Assigned Interest") in the Assignor's
rights and obligations under the Agreement, including, without limitation, the
interests set forth on the reverse hereof in the Commitment of the Assignor on
the [EFFECTIVE DATE OF ASSIGNMENT] and the Loans owing to the Assignor that are
outstanding on the [EFFECTIVE DATE OF ASSIGNMENT], together with unpaid interest
accrued on the assigned Loans to the [EFFECTIVE DATE OF ASSIGNMENT] and the
amount, if any, set forth on the reverse hereof of the Fees accrued to the
[EFFECTIVE DATE OF ASSIGNMENT] for the account of the Assignor. Each of the
Assignor and the Assignee hereby makes and agrees to be bound by all the
representations, warranties and agreements set forth in Section 8.04 of the
Agreement, a copy of which has been received by each such party. From and after
the [EFFECTIVE DATE OF ASSIGNMENT], (i) the Assignee shall be a party to and be
bound by the provisions of the Agreement and, to the extent of the interests
assigned by this Assignment and Acceptance, have the rights and obligations of a
Lender thereunder and (ii) the Assignor shall, to the extent of the interests
assigned by this Assignment and Acceptance, relinquish its rights and be
released from its obligations under the Agreement.
2. This Assignment and Acceptance is being delivered to the Agent
together with (i) if the Assignee is organized under the laws of a jurisdiction
outside the United States, the forms specified in Section 2.16(g) of the
Agreement, duly completed and executed by such Assignee and (ii) a processing
and recordation fee of $3,500.
2
3. This Assignment and Acceptance shall be governed by and construed in
accordance with the laws of the State of New York.
Date of Assignment:
Legal Name of Assignor:
Legal Name of Assignee:
Assignee's Address for Notices:
Effective Date of Assignment (may not be fewer than 5 Business Days after the
Date of Assignment unless otherwise agreed by the Agent):
--------------------------------------------------------------------------------------------------------------------
Percentage Assigned of
Facility/Commitment (set forth, to at
Facility least 8 decimals, as a percentage of the
Principal Amount Assigned Facility and the aggregate Commitments of
all Lenders thereunder)
Commitment Assigned: $____________ __________%
Loans: $____________ __________%
Fees Assigned (if any): $____________ __________%
3
The terms set forth and on the reverse side Accepted:
hereof are hereby agreed to: TXU US HOLDINGS COMPANY
, as By
------------------------------------ --------------------
Assignor Name:
Title:
By
----------------------------------
Name:
Title: CITIBANK, N.A.,
as Agent
------------------------------------, as
Assignee,
By By
------------------------ ----------------------
Name: Name:
Title: Title:
SCHEDULE 2.01
COMMITMENTS
-------------------------------------------------------- --------------------
NAME OF LENDER COMMITMENT
-------------------------------------------------------- --------------------
Citibank, N.A. $100,000,000
-------------------------------------------------------- --------------------
Credit Suisse First Boston $105,000,000
-------------------------------------------------------- --------------------
Bank of America, N.A. $100,000,000
------------------------------------------------------- --------------------
Commerzbank $50,000,000
------------------------------------------------------- --------------------
Sumitomo Mitsui Banking Corporation $30,000,000
------------------------------------------------------- --------------------
Amarillo Bank $10,000,000
------------------------------------------------------- --------------------
▇▇▇▇▇▇▇ ▇▇▇▇▇ Capital Corporation $5,000,000
------------------------------------------------------- --------------------
Total $400,000,000
-------------------------------------------------------- --------------------
SCHEDULE 5.13
RESTRICTIVE AGREEMENTS
Oncor Mortgage