310,000,000 Term Loan
|
among
MDU
RESOURCES GROUP, INC.
as
Borrower;
▇▇▇▇▇
FARGO BANK, NATIONAL ASSOCIATION,
as
Administrative Agent;
and
THE
OTHER FINANCIAL INSTITUTIONS PARTY HERETO
|
|
Closing
Date: June 29, 2007
|
$310,000,000
Term Loan
TABLE
OF CONTENTS
ARTICLE
I Definitions
Section
1.1 Definitions
Section
1.2 Rules
of
Construction
ARTICLE
II Amount and Terms of the Term Loan
Section
2.1 The
Term
Loan
Section
2.2 Procedure
Section
2.3 Interest
on Notes
Section
2.4 Principal
and Interest Payment Dates
Section
2.5 Level
Status, Margins and Fee Rates
Section
2.6 Fees
Section
2.7 Prepayments
Section
2.8 Payments
Section
2.9 Increased
Costs; Funding Exceptions
Section
2.10 Funding
Losses
Section
2.11 Discretion
of Lenders as to Manner of Funding
Section
2.12 Conclusiveness
of Statements; Survival of Provisions
Section
2.13 Computation
of Interest and Fees
Section
2.14 Purpose
of Term Loan
ARTICLE
III Conditions Precedent
Section
3.1 Required
Deliveries
Section
3.2 Additional
Conditions Precedent
ARTICLE
IV Representations and Warranties
Section
4.1 Existence
and Power
Section
4.2 Authorization
of Borrowing; No Conflict as to Law or Agreements
Section
4.3 Legal
Agreements
Section
4.4 Subsidiaries
Section
4.5 Financial
Condition
Section
4.6 Adverse
Change
Section
4.7 Litigation
Section
4.8 Environmental
Matters
Section
4.9 Regulation
U
Section
4.10 Taxes
Section
4.11 Titles
and Liens
Section
4.12 Intellectual
Property
Section
4.13 ERISA
ARTICLE
V Affirmative Covenants
Section
5.1 Reporting
Section
5.2 Books
and
Records; Inspection and Examination
Section
5.3 Compliance
with Laws
Section
5.4 Payment
of Taxes and Other Claims
Section
5.5 Maintenance
of Properties
Section
5.6 Insurance
Section
5.7 Preservation
of Corporate Existence
Section
5.8 Replacement
Financing
ARTICLE
VI Negative Covenants
Section
6.1 Liens
Section
6.2 Investments
Section
6.3 Distributions
Section
6.4 Sale
of
Assets
Section
6.5 Transactions
with Affiliates
Section
6.6 Consolidation
and Merger
Section
6.7 Environmental
Laws
Section
6.8 Restrictions
on Nature of Business
Section
6.9 Consolidated
Total Leverage Ratio
Section
6.10 Borrower
Leverage Ratio
Section
6.11 Interest
Coverage Ratio
ARTICLE
VII Events of Default, Rights and Remedies
Section
7.1 Events
of
Default
Section
7.2 Rights
and Remedies
ARTICLE
VIII The Agent
Section
8.1 Authorization
Section
8.2 Distribution
of Payments and Proceeds
Section
8.3 Expenses
Section
8.4 Payments
Received Directly by Lenders
Section
8.5 Indemnification
Section
8.6 Exculpation
Section
8.7 Agent
and
Affiliates
Section
8.8 Credit
Investigation
Section
8.9 Resignation
and Assignment of Agent
Section
8.10 Defaults
Section
8.11 Obligations
Several
ARTICLE
IX Miscellaneous
Section
9.1 No
Waiver; Cumulative Remedies
Section
9.2 Amendments,
Etc.
Section
9.3 Notice
Section
9.4 Costs
and
Expenses
Section
9.5 Indemnification
by Borrower
Section
9.6 Execution
in Counterparts
Section
9.7 Binding
Effect; Assignment and Participations
Section
9.8 Disclosure
of Information
Section
9.9 Governing
Law
Section
9.10 Consent
to Jurisdiction
Section
9.11 Waiver
of
Jury Trial
Section
9.12 Severability
of Provisions
Section
9.13 Prior
Agreements
Section
9.14 Other
Financing
Section
9.15 Headings
Section
9.16 Customer
Identification - USA Patriot Act Notice
Dated
as
of June 29, 2007
MDU
Resources Group, Inc., a Delaware corporation, ▇▇▇▇▇ Fargo Bank, National
Association, a national banking association, as administrative agent hereunder,
and the Lenders, as defined below, agree as follows:
ARTICLE
I
Definitions
Section
1.1 Definitions.
As
used
in this Agreement:
“2005
Credit Agreement” means the Credit Agreement dated June 21, 2005 among the
Borrower, ▇▇▇▇▇ Fargo, as administrative agent thereunder, and certain other
financial institutions, together with all amendments, modifications and
restatements thereof.
“Additional
Lender” means a financial institution that becomes a Lender pursuant to the
procedures set forth in Section 9.7(c).
“Affiliate”
of any Person means any other Person directly or indirectly controlling,
controlled by or under the common control with such Person. A Person shall
be
deemed to control another Person if the controlling Person owns 10% or more
of
any class of voting securities (or other ownership interests) of the controlled
Person or possesses, directly or indirectly, the power to direct or cause the
direction of the management or policies of the controlled Person, whether
through ownership of stock or other equity interests, by contract or
otherwise.
“Agent”
means ▇▇▇▇▇ Fargo acting in its capacity as administrative agent for itself
and
the other Lenders hereunder.
“Aggregate
Commitment Amount” means $310,000,000.
“Agreement”
means this Term Loan Agreement.
“Applicable
Rating” means (i) with respect to S&P, the rating designated by S&P as
its corporate credit rating of the Borrower, (ii) with respect to ▇▇▇▇▇’▇,
the rating designated by ▇▇▇▇▇’▇ as its issuer rating of the Borrower, and
(iii) with respect to Fitch, the rating designated by Fitch as its rating
of the Borrower’s senior unsecured debt.
“Assignment
Certificate” has the meaning set forth in Section 9.7(e).
“Authorizing
Order” means any order of any public utilities commission or any other
regulatory body having jurisdiction over the Borrower, authorizing and/or
restricting the indebtedness that may be created from time to time hereunder
(whether on account of the Term Loan or otherwise).
“Base
LIBO Rate” means the rate per annum for United States dollar deposits quoted by
the Agent as the Interbank Market Offered Rate, with the understanding that
such
rate is quoted by the Agent for the purpose of calculating effective rates
of
interest for loans making reference thereto, on the first day of an Interest
Period for delivery of funds on said date for a period of time approximately
equal to the number of days in such Interest Period and in an amount
approximately equal to the principal amount to which such Interest Period
applies. The Borrower understands and agrees that the Agent may base its
quotation of the Interbank Market Offered Rate upon such offers or other market
indicators of the Interbank Market as the Agent in its discretion deems
appropriate including, but not limited to, the rate offered for U.S. dollar
deposits on the London Interbank Market.
“Borrower”
means MDU Resources Group, Inc., a Delaware corporation.
“Borrower
Leverage Ratio” means the ratio of Funded Debt to Capitalization, determined
with respect to the Borrower alone (excluding its Subsidiaries, but including
any divisions of the Borrower not constituting separate Persons) as at the
end
of each fiscal quarter of the Borrower.
“Business
Day” means a day other than a Saturday, Sunday, United States national holiday
or other day on which banks in Minnesota are permitted or required by law to
close. Whenever the context relates to a LIBO Rate Funding or the fixing of
a
LIBO Rate, “Business Day” means a day (i) that meets the foregoing
definition, and (ii) on which dealings in U.S. dollar deposits are carried
on in the London interbank eurodollar market.
“Capital
Stock” means, with respect to any Person, any and all shares, interests,
participations or other equivalents (however designated) of such Person’s
capital stock or equity, whether now outstanding or issued after the date
hereof, including all common stock, preferred stock, partnership interests
and
limited liability company member interests.
“Capitalization”
means, with respect to any Person as of any Covenant Compliance Date, (i) Funded
Debt of that Person, plus (ii) shareholders’ equity of that Person (excluding
any non-cash gain or loss resulting from the requirements of Financial
Accounting Standards Board Statement No. 133, “Accounting for Derivative
Instruments and Hedging Activities”), all determined in accordance with GAAP. In
determining Capitalization for purposes of calculating the Borrower Leverage
Ratio, Funded Debt and equity attributable to any Subsidiary shall be
excluded.
“Capitalized
Lease” means any lease that in accordance with GAAP should be capitalized on the
balance sheet of the lessee thereunder or for which the amount of the asset
and
liability thereunder as if so capitalized should be disclosed in a note to
such
balance sheet. All obligations under any lease that is treated as an operating
lease under GAAP but pursuant to which the lessee thereunder retains tax
ownership of the leased property for federal income tax purposes shall be
treated as a Capitalized Lease for purposes of this Agreement.
“Cascade”
means Cascade Natural Gas Corporation, a Washington corporation.
“Cascade
Acquisition” means the merger of Cascade
Merger Sub into Cascade in accordance with the Agreement and Plan of Merger
dated July 8, 2006 among the Borrower, Cascade Merger Sub and Cascade, the
result of which merger being that Cascade, as the surviving corporation, will
be
a wholly-owned Subsidiary of the Borrower.
“Cascade
DebtCo” means MDU Energy Capital, LLC, a Delaware limited liability
company.
“Cascade
Merger Sub” means Firemoon Acquisition, Inc., a Washington corporation that is a
wholly-owned Subsidiary of the Borrower.
“Change
of Control” means, with respect to any corporation, either (i) the
acquisition by any “person” or “group” (as those terms are used in Sections
13(d) and 14(d) of the Exchange Act) of beneficial ownership (as defined in
Rules 13d-3 and 13d-5 of the Securities and Exchange Commission, except that
a
Person shall be deemed to have beneficial ownership of all securities that
such
Person has the right to acquire, whether such right is exercisable immediately
or only after the passage of time), directly or indirectly, of 25% or more
of
the then-outstanding voting capital stock of such corporation; or (ii) a
change in the composition of the board of directors of such corporation or
any
corporate parent of such corporation such that continuing directors cease to
constitute more than 50% of such board of directors. As used in this definition,
“continuing directors” means, as of any date, (i) those members of the
board of directors of the applicable corporation who assumed office prior to
such date, and (ii) those members of the board of directors of the
applicable corporation who assumed office after such date and whose appointment
or nomination for election by that corporation’s shareholders was approved by a
vote of at least 50% of the directors of such corporation in office immediately
prior to such appointment or nomination.
“Code”
means the Internal Revenue Code of 1986, and the regulations promulgated
thereunder, as amended, reformed or otherwise modified from time to time.
“Commitment”
means, with respect to each Lender, that Lender’s commitment to fund its
Percentage of the Term Loan pursuant to Article II.
“Commitment
Amount” means, (i) with respect to each original Lender hereunder, the
amount set forth opposite that Lender’s name in Exhibit A, or (ii) with
respect to each Additional Lender, the amount so designated on the applicable
Assignment Certificate, in each case as such amount may be adjusted pursuant
to
any Assignment Certificate.
“Compliance
Certificate” means a certificate in substantially the form of Exhibit C, or such
other form as the Borrower and the Required Lenders may from time to time agree
upon in writing, executed by the chief financial officer of the Borrower,
stating (i) that any financial statements delivered therewith have been
prepared in accordance with GAAP (or, in the case of statements prepared
pursuant to Section 5.1(a)(iii), in accordance with FERC Accounting Principles),
subject to year-end adjustments, (ii) whether or not such officer has
knowledge of the occurrence of any Default or Event of Default hereunder not
theretofore reported and remedied and, if so, stating in reasonable detail
the
facts with respect thereto and (iii) all relevant facts in reasonable
detail to evidence, and the computations as to, whether or not the Borrower
is
in compliance with the Financial Covenants.
“Consolidated
Net Worth” means, at any time, the excess of total assets of the Borrower over
total liabilities of the Borrower as of the last day of the fiscal quarter
most
recently then ended, determined on a consolidated basis in accordance with
GAAP.
“Consolidated
Total Leverage Ratio” means, as of any Covenant Compliance Date, the ratio of
Funded Debt to Capitalization, determined on a consolidated basis with respect
to the Borrower and all of its Subsidiaries.
“Covenant
Compliance Date” means the last day of each fiscal quarter of the
Borrower.
“Credit
Exposure” means, with respect to any Lender, (i) at any time prior to making the
Term Loan, such Lender’s Commitment Amount, or (ii) thereafter, the outstanding
principal amount of such Lender’s Note.
“Default”
means an event that, with the giving of notice, the passage of time or both,
would constitute an Event of Default.
“Distribution”
means any payment made by the Borrower on account of any equity interest in
the
Borrower, including but not limited to any dividend and any payment in purchase,
redemption or other retirement of any stock or membership interest.
“EBITDA”
means, with respect to any period:
|
(i)
|
(A)
the after-tax net income of the Borrower for such period, determined
on an
unconsolidated basis in accordance with GAAP, excluding (B) non-operating
gains and losses (including extraordinary or unusual gains and losses,
gains and losses from discontinuance of operations, gains and losses
arising from the sale of assets other than inventory, and other
non-recurring gains and losses),
|
plus
|
(ii)
|
the
sum of the following to the extent deducted in arriving at the after-tax
net income determined in clause (i)(A) of this definition (but without
duplication for any item):
|
|
(A)
|
Interest
Expense,
|
|
(B)
|
federal,
state and local income taxes paid by the Borrower,
and
|
|
(C)
|
depreciation
and amortization.
|
“Eligible
Lender” means (a) a financial institution organized under the laws of the United
States, or any state thereof, and having a combined capital and surplus of
at
least $100,000,000; (b) a commercial bank organized under the laws of any other
country which is a member of the Organization for Economic Cooperation and
Development, or a political subdivision of any such country, and having a
combined capital and surplus of at least $100,000,000, provided that such bank
is acting through a branch or agency located in the United States; and (c)
a
Person that is primarily engaged in the business of commercial banking and
that
is (i) a Subsidiary of a Lender, (ii) a Subsidiary of a Person of which a Lender
is a Subsidiary, or (iii) a Person of which a Lender is a
Subsidiary.
“Environmental
Claim” means a material claim, however asserted, by any governmental authority
or other Person alleging potential liability or responsibility for violation
of
any Environmental Law, or for release or injury to the environment.
“Environmental
Law” means the Comprehensive Environmental Response, Compensation and Liability
Act, 42 U.S.C. § 9601 et
seq.,
the
Resource Conservation and Recovery Act, 42 U.S.C. § 6901 et
seq.,
the
Hazardous Materials Transportation Act, 49 U.S.C. § 1802 et
seq.,
the
Toxic Substances Control Act, 15 U.S.C. § 2601 et
seq.,
the
Federal Water Pollution Control Act, 33 U.S.C. § 1252 et
seq.,
the
Clean Water Act, 33 U.S.C. § 1321 et
seq.,
the
Clean Air Act, 42 U.S.C. § 7401 et
seq.,
and any
other federal, state, county, municipal, local or other statute, law, ordinance
or regulation which in each case relates to human health or the environment,
all
as may be from time to time amended.
“ERISA”
means the Employee Retirement Income Security Act of 1974, as
amended.
“ERISA
Affiliate” means any trade or business (whether or not incorporated) that is,
along with the Borrower, a member of a controlled group of corporations or
a
controlled group of trades or businesses, as described in sections 414(b) and
414(c), respectively, of the Code.
“ERISA
Event” means (a) a Reportable Event with respect to a Pension Plan; (b) a
withdrawal by the Borrower or any ERISA Affiliate from a Pension Plan subject
to
Section 4063 of ERISA during a plan year in which it was a substantial employer
(as defined in Section 4001(a)(2) of ERISA) or a cessation of operations which
is treated as such a withdrawal under Section 4062(e) of ERISA; (c) a complete
or partial withdrawal by the Borrower or any ERISA Affiliate from a
Multiemployer Plan or notification that a Multiemployer Plan is in
reorganization; (d) the commencement of proceedings by the PBGC to terminate
a
Pension Plan; (e) a failure by the Borrower or any ERISA Affiliate to make
required contributions to a Pension Plan, Multiemployer Plan or other Plan
subject to Section 412 of the Code; (f) an event or condition which might
reasonably be expected to constitute grounds under Section 4042 of ERISA for
the
termination of, or the appointment of a trustee to administer, any Pension
Plan;
(g) the imposition of any liability under Title IV of ERISA, other than PBGC
premiums due but not delinquent under Section 4007 of ERISA, upon the Borrower
or any ERISA Affiliate; or (h) an application for a funding waiver or an
extension of any amortization period pursuant to Section 412 of the Code with
respect to any Plan.
“ERISA
Termination Event” means the filing of a notice of intent to terminate a Pension
Plan, or the treatment of a plan amendment as the termination of a Pension
Plan,
under Section 4041 or 4041A of ERISA.
“Event
of
Default” has the meaning specified in Section 7.1.
“Exchange
Act” means the Securities Exchange Act of 1934, as amended.
“Facility
Fee Rate” means a percentage, determined as set forth in Section
2.5.
“Federal
Funds Rate” means at any time an interest rate per annum equal to the weighted
average of the rates for overnight federal funds transactions with members
of
the Federal Reserve System arranged by federal funds brokers, as published
for
such day by the Federal Reserve Bank of New York, or, if such rate is not so
published for any day which is a Business Day, the average of the quotations
for
such day for such transactions received by the Agent from three federal funds
brokers of recognized standing selected by it, it being understood that the
Federal Funds Rate for any day which is not a Business Day shall be the Federal
Funds Rate for the next preceding Business Day.
“Fee
Letters” means one or more separate agreements between the Borrower and the
Agent, setting forth the terms of certain fees to be paid by the Borrower to
the
Agent for the Agent’s own behalf or for the benefit of the Lenders, as more
fully set forth therein.
“FERC
Accounting Principles” means the accounting requirements of the Federal Energy
Regulatory Commission as set forth in its applicable Uniform System of Accounts
and published accounting releases.
“Financial
Covenant” means any of the Borrower’s obligations set forth in Sections 6.9,
6.10 and 6.11 of this Agreement
“Fitch”
means Fitch, Inc.
“Floating
Rate” means, at any time, an annual rate equal to the sum of the Floating Rate
Margin and the greater of:
(a)
the
Prime Rate,
or
(b)
the
Federal Funds Rate, plus 50 basis points (0.50%).
The
Floating Rate shall change when and as the Prime Rate or Federal Funds Rate,
as
the case may be, or Floating Rate Margin changes.
“Floating
Rate Funding” means any portion of the principal balance of the Notes bearing
interest at the Floating Rate.
“Floating
Rate Margin” means a percentage, determined as set forth in Section
2.5.
“Funded
Debt” of any Person means (without duplication) (i) all indebtedness of
such Person for borrowed money (which shall, in the case of the Borrower,
include but not be limited to all indebtedness under this Agreement, all
indebtedness arising under the Mortgage Indentures, and all Subordinated Debt);
(ii) indebtedness of such Person evidenced by bonds, notes or similar
written instruments, whether or not representing obligations for borrowed money;
(iii) all liabilities required to appear on such Person’s balance sheet
with respect to Capitalized Lease obligations of such Person; (iv) all
indebtedness secured by a Lien on any property owned by such Person, whether
or
not such indebtedness has been assumed by such Person or is nonrecourse to
such
Person; (v) the face amount of all letters of credit and bankers’
acceptances issued for the account of such Person, and without duplication,
all
drafts drawn thereunder; (vi) all obligations of such Person with respect
to leases constituting part of a sale and leaseback arrangement; (vii) all
net obligations of such Person under interest rate agreements or currency
agreements; and (viii) guaranty obligations of such Person with respect to
indebtedness for borrowed money of another Person (including affiliates).
“Funding”
means a Floating Rate Funding or a LIBO Rate Funding.
“GAAP”
means generally accepted accounting principles as in effect from time to time
applied on a basis consistent with the accounting practices applied in the
financial statements of the Borrower and its Subsidiaries referred to in Section
4.5.
“Insolvency
Proceeding” means, with respect to a Person, (a) any case, action or proceeding
with respect to such Person before any court or other governmental authority
relating to bankruptcy, reorganization, insolvency, liquidation, receivership,
dissolution, winding-up or relief of debtors, or (b) any general assignment
for
the benefit to creditors, composition, marshalling of assets for creditors,
or
other similar arrangement in respect of its creditors generally or any
substantial portion of its creditors, undertaken under U.S. federal, state
or
foreign law, including the Federal Bankruptcy Reform Act of 1978 (11 U.S.C.
§101, et seq.).
“Interest
Coverage Ratio” means, as of any Covenant Compliance Date, the ratio of (i)
EBITDA during the period of 12 months ending on that Covenant Compliance Date,
to (ii) Interest Expense during such period.
“Interest
Expense” means, with respect to any period, the aggregate interest expense
(including capitalized interest) of the Borrower alone (i.e., on an
unconsolidated basis) for such period, including but not limited to the interest
portion of any Capitalized Lease; provided, however, that the foregoing shall
be
adjusted to reflect only the net effect of any interest rate swap, interest
hedging transaction or other similar arrangement entered into by the Borrower
to
reduce or eliminate variations in its interest expenses.
“Interest
Period” means, with respect to any LIBO Rate Funding, a period of one, two,
three or six months beginning on a Business Day, or such other period as the
Agent may in its sole discretion permit, in each case as elected by the
Borrower.
“Lenders”
means ▇▇▇▇▇ Fargo, acting on its own behalf and not as Agent, each of the
undersigned lenders, and any financial institution that becomes a Lender
pursuant to Section 9.7(c), collectively.
“Level
Status” means ▇▇▇▇▇ ▇, ▇▇▇▇▇ ▇▇, ▇▇▇▇▇ ▇▇▇, ▇▇▇▇▇ ▇▇ or Level V, each as
determined pursuant to Section 2.5.
“LIBO
Rate” means the rate per annum (rounded upward, if necessary, to the nearest
whole 1/8 of 1%) and determined pursuant to the following formula:
|
LIBO
Rate =
|
Base
LIBO Rate
|
+
|
LIBO
Rate Margin
|
|
100%
- LIBOR Reserve Percentage
|
“LIBO
Rate Funding” means any portion of the principal balance of the Notes bearing
interest at a LIBO Rate.
“LIBO
Rate Margin” means a percentage, determined as set forth in Section
2.5.
“LIBOR
Reserve Percentage” means the reserve percentage prescribed by the Board of
Governors of the Federal Reserve System (or any successor) for “Eurocurrency
Liabilities” (as defined in Regulation D of the Federal Reserve Board, as
amended), adjusted by the Agent for expected changes in such reserve percentage
during the applicable Interest Period.
“Lien”
means any mortgage, deed of trust, lien, pledge, security interest or other
charge or encumbrance, of any kind whatsoever, including but not limited to
the
interest of the lessor or titleholder under any Capitalized Lease, title
retention contract or similar agreement.
“Loan
Documents” means this Agreement, the Notes and the Fee Letters.
“Margin”
means the Floating Rate Margin or the LIBO Rate Margin, as the case may
be.
“Material
Adverse Effect” means a material adverse effect on (i) the condition
(financial or otherwise), properties, or operations of the Borrower,
(ii) the ability of the Borrower to perform its obligations under the Loan
Documents, or (iii) the validity or enforceability of any of the Loan Documents
or the rights or remedies of the Agent or any Lender thereunder.
“Maturity
Date” means June 27, 2008.
“▇▇▇▇▇’▇”
means ▇▇▇▇▇’▇ Investors Service, Inc.
“Mortgage
Indentures” means (i) the Indenture of Mortgage dated as of May 1, 1939 executed
by the Borrower and delivered to The New York Trust Company and ▇.▇. ▇▇▇▇▇▇▇,
as
trustees thereunder, as heretofore amended and supplemented and as hereafter
amended and/or supplemented from time to time, and (ii) the Indenture, dated
as
of December 15, 2003, executed by the Borrower and delivered to the Bank of
New
York, as trustee thereunder, as heretofore amended and supplemented and as
hereafter amended and/or supplemented from time to time.
“Multiemployer
Plan” means a “multiemployer plan” (within the meaning of Section 4001(a)(3) of
ERISA) to which the Borrower or any ERISA Affiliate makes, is making, or is
obligated to make contributions or, during the preceding three calendar years,
has made, or been obligated to make, contributions.
“Note”
means a promissory note of the Borrower in the form of Exhibit B.
“Obligations”
means each and every debt, liability and obligation of every type and
description arising under or in connection with any of the Loan Documents which
the Borrower may now or at any time hereafter owe to any Lender or the Agent,
whether such debt, liability or obligation now exists or is hereafter created
or
incurred, whether it is direct or indirect, due or to become due, absolute
or
contingent, primary or secondary, liquidated or unliquidated, or sole, joint,
several or joint and several, and including but not limited to principal of
and
interest on the Notes, all fees due under this Agreement, any Fee Letter or
any
related agreement, and any obligation of the Borrower to the Agent or any Lender
under any hedging arrangement entered into with the Agent or any Lender with
respect to the Borrower’s obligations arising under this Agreement.
“PBGC”
means the Pension Benefit Guaranty Corporation.
“Pension
Plan” means a pension plan (as defined in Section 3(2) of ERISA) subject to
Title IV of ERISA which the Borrower or any ERISA Affiliate sponsors, maintains,
or to which it makes, is making, or is obligated to make contributions, or
in
the case of a multiple employer plan (as described in Section 4064(a) of ERISA)
has made contributions at any time during the immediately preceding five (5)
plan years but excluding any Multiemployer Plan.
“Percentage”
means, with respect to each Lender, the ratio of (i) that Lender’s Credit
Exposure, to (ii) the aggregate Credit Exposure of all of the Lenders.
“Person”
means any individual, corporation, partnership, limited liability company,
joint
venture, association, joint-stock company, trust, unincorporated organization
or
government or any agency or political subdivision thereof.
“Plan”
means an employee benefit plan (as defined in Section 3(3) of ERISA) which
the
Borrower or any ERISA Affiliate sponsors or maintains or to which the Borrower
or any ERISA Affiliate makes, is making, or is obligated to make contributions
and includes any Pension Plan but excluding any Multiemployer Plan.
“Prime
Rate” means, at any time, the rate of interest most recently announced within
the Agent at its principal office as its “prime rate” or, if the Agent ceases to
announce a rate so designated, any similar successor rate designated by the
Agent. Such rate is one of the Agent’s base rates and serves as the basis upon
which effective rates of interest are calculated for those loans making
reference thereto, and is evidenced by the recording thereof in such internal
publication or publications as the Agent may designate.
“Rating
Agencies” means Fitch, ▇▇▇▇▇’▇ and S&P, collectively.
“Reportable
Event” means any of the events set forth in Section 4043(c) of ERISA or the
regulations thereunder, other than any such event for which the 30-day notice
requirement under ERISA has been waived in regulations issued by the PBGC.
“Required
Lenders” means one or more Lenders (including, where relevant, Additional
Lenders) having an aggregate Percentage in excess of 50%.
“S&P”
means Standard & Poor’s Ratings Group, a division of ▇▇▇▇▇▇-▇▇▇▇
Companies.
“Solvent”
means as to any Person at any time (a) the fair value of the property of such
Person is greater than the amount of such Person’s liabilities (including the
probable liability of such Person on disputed, contingent and unliquidated
liabilities) as such value is established and liabilities evaluated for purposes
of Section 101(32) of the Bankruptcy Code; (b) the present fair saleable value
of the property of such Person is not less than the amount that will be required
to pay the probable liability of such Person on its debts as they become
absolute and matured; (c) such Person is able to realize upon its property
and
pay its debts and other liabilities (including the probable liability of such
Person on disputed, contingent and unliquidated liabilities) as they mature
in
the normal course of business; (d) such Person does not intend to, and does
not
believe that it will, incur debts or liabilities beyond such Person’s ability to
pay as such debts and liabilities mature; and (e) such Person is not engaged
in
business or a transaction, and is not about to engage in business or a
transaction, for which such Person’s property would constitute unreasonably
small capital.
“Subordinated
Debt” means all indebtedness and other obligations of the Borrower which are
subordinated in right of payment to all indebtedness of the Borrower to any
Lender, on terms that have been approved in writing by the Required Lenders
and
that have been noted by appropriate legend on all instruments evidencing the
Subordinated Debt.
“Subsidiary”
of a Person means any corporation, association, partnership, limited liability
company, joint venture or other business entity of which more than 50% of the
voting stock, membership interests or other equity interests (in the case of
Persons other than corporations), is owned or controlled directly or indirectly
by the Person, by one of more of the Subsidiaries of the Person, or by a
combination thereof. Unless the context otherwise clearly requires, references
herein to a “Subsidiary” refer to a Subsidiary of the Borrower.
“Term
Loan” means the advances to be made by the Lenders pursuant to Section 2.1,
collectively.
“Term
Loan Funding Deadline” means July 31, 2007.
“Unfunded
Pension Liability” means the excess of a Pension Plan’s benefit liabilities
under Section 302(d)(7) of ERISA over the current value of that Plan’s assets,
determined in accordance with the assumptions used for funding the Pension
Plan
pursuant to Section 412 of the Code for the applicable plan year.
“▇▇▇▇▇
Fargo” means ▇▇▇▇▇ Fargo Bank, National Association, a national banking
association and a party to this Agreement.
Section
1.2 Rules
of Construction
For
all
purposes of this Agreement, except as otherwise expressly provided or unless
the
context otherwise requires:
(a) The
terms
defined in this Article have the meanings assigned to them in this Article,
and
include the plural as well as the singular.
(b) All
accounting terms not otherwise defined herein have the meanings assigned to
them
in accordance with GAAP.
(c) All
references to times of day in this Agreement shall be references to Minneapolis,
Minnesota time unless otherwise specifically provided.
ARTICLE
II
Amount
and Terms of the Term Loan
Section
2.1 The
Term Loan.
Each
Lender agrees, severally but not jointly, on the terms and subject to the
conditions hereinafter set forth, to make a single advance to the Borrower
on or
before the Term Loan Funding Deadline in an aggregate amount not to exceed
the
lesser of that Lender’s Commitment Amount or that Lender’s Percentage of the
amount requested by the Borrower in accordance with Section 2.2. The facility
established hereby shall not be a revolving facility; the Borrower may not
reborrow any amount that has been prepaid. The advance made by each Lender
shall
be evidenced by a Note, payable to the order of that Lender in the face
principal amount of that Lender’s Commitment Amount.
Section
2.2 Procedure.
The
Lenders will make the Term Loan on prior written request from the Borrower
to
the Agent, which request shall specify the date of the Term Loan and the amount
thereof. Except as set forth in Section 2.3(b), such request shall be made
not
less than one Business Day before the date of the Term Loan. Promptly upon
receipt of such request, the Agent shall advise each Lender of such request,
including the amount requested and such Lender’s Percentage of such amount. At
or before 2:00 p.m. on the date of the Term Loan, each Lender shall provide
the
Agent at the principal office of the Agent in Minneapolis, Minnesota with
immediately available funds covering such Lender’s Percentage of the Term Loan.
The Agent shall disburse the amount of the Term Loan by crediting the same
to
the Borrower’s demand deposit account maintained with the Agent or in such other
manner as the Agent and the Borrower may agree; provided, however, that the
Agent shall have no obligation to disburse the Term Loan if any condition set
forth in Article III has not been satisfied on the day of the Term Loan or
if
any Lender has failed to fund its Percentage of the Term Loan. The Borrower
shall be obligated to repay the Term Loan notwithstanding the fact that the
person requesting same was not in fact authorized to do so. The Borrower’s
request for the Term Loan shall be deemed to be a representation that the
statements set forth in Section 3.2 are correct.
Section
2.3 Interest
on Notes.
(a) Floating
Rate Fundings.
Unless
the Borrower elects a LIBO Rate pursuant to this Section, the principal balance
of the Notes shall bear interest at the Floating Rate.
(b) LIBO
Rate Fundings.
So long
as no Default or Event of Default exists, the Borrower may request that a
portion of the Term Loan constitute a LIBO Rate Funding, or may convert all
or
any part of any outstanding Floating Rate Funding into a LIBO Rate Funding,
or
may request that a LIBO Rate Funding be converted at the end of the applicable
Interest Period to another LIBO Rate Funding, by giving notice to the Agent
of
such request or conversion not later than 10:30 a.m. on a Business Day which
is
at least three Business Days prior to the date of the Term Loan or conversion.
Each such notice shall be effective upon receipt by the Agent, shall be in
writing or by telephone or telecopy transmission, shall specify the date and
amount of such LIBO Rate Funding and the Interest Period therefor. The Interest
Period applicable to each LIBO Rate Funding shall begin on a Business Day,
and
the amount of each LIBO Rate Funding shall be an integral multiple of $1,000,000
and not less than $25,000,000. Subject to the terms and conditions hereof,
the
principal amount specified by the Borrower in the applicable request for a
LIBO
Rate Funding shall bear interest from and including the first day of the
Interest Period specified therein to but not including the last day of such
Interest Period, at the LIBO Rate applicable thereto, determined as set forth
herein, (subject to fluctuations in the applicable Margin). Unless the Borrower
requests a new LIBO Rate Funding in accordance with the procedures set forth
above, or prepays the principal of an outstanding LIBO Rate Funding at the
expiration of an Interest Period, the Lenders shall automatically and without
request of the Borrower convert each LIBO Rate Funding to a Floating Rate
Funding on the last day of the relevant Interest Period.
(c) Setting
of LIBO Rates.
The
applicable LIBO Rate for each Interest Period shall be determined by the Agent
between the opening of business and 12:00 noon on the second Business Day prior
to the beginning of such Interest Period, whereupon notice thereof (which may
be
by telephone) shall be given by the Agent to the Borrower and each Lender.
Each
such determination of the applicable LIBO Rate shall be conclusive and binding
upon the parties hereto, in the absence of demonstrable error. The Agent, upon
written request of the Borrower, shall deliver to the Borrower a statement
showing the computations used by the Agent in determining the applicable LIBO
Rate hereunder.
(d) Limitations
on LIBO Rate Fundings.
In no
event shall more than 7 LIBO Rate Fundings be outstanding at any one time.
In no
event may the Borrower request a LIBO Rate Funding if, after giving effect
to
such LIBO Rate Funding, the Borrower would be required to prepay a LIBO Rate
Funding in order to make any regularly scheduled principal payment.
Section
2.4 Principal
and Interest Payment Dates.
(a) Interest.
Interest
accruing on Floating Rate Fundings shall be due and payable on the last day
of
each calendar quarter. Interest on any LIBO Rate Funding shall be due and
payable on the last day of the applicable Interest Period or, if such Interest
Period is in excess of three months, on the last day of each three-month period
during such Interest Period and on the last day of such Interest
Period.
(b) Principal.
The
Borrower shall pay the principal balance of the Notes in full on the Maturity
Date.
Section
2.5 Level
Status, Margins and Fee Rates.
(a) The
Borrower’s Level Status shall be determined on the basis of the Applicable
Ratings established by the Rating Agencies, in accordance with the following
table:
|
|
Level
I
|
Level
II
|
Level
III
|
Level
IV
|
Level
V
|
|
S&P
|
A
or better
|
A-
or better, but less than A
|
BBB+
or better, but less than A-
|
BBB
or better, but less than BBB+
|
Less
than BBB
|
|
Moody’s
|
A2
or better
|
A3
or better, but less than A2
|
Baa1
or better, but less than A3
|
Baa2
or better, but less than Baa1
|
Less
than Baa2
|
|
Fitch
|
A
or better
|
A-
or better, but less than A
|
BBB+
or better, but less than A-
|
BBB
or better, but less than BBB+
|
Less
than BBB
|
If
the
Applicable Ratings established by the Rating Agencies differ such that they
do
not fall within a single column in the table set forth above, the Borrower’s
Level Status shall be determined as follows:
|
(i)
|
If
the Applicable Ratings applied by any two of the Rating Agencies
are in
the same column, the Borrower’s Level Status shall be determined by that
column.
|
|
(ii)
|
If
the Applicable Ratings are each in separate columns, the highest
and
lowest columns shall be excluded, and the Borrower’s Level Status shall be
determined by the remaining Applicable
Rating.
|
(b) In
making
the determinations under paragraph (a):
|
(i)
|
If
any of the Rating Agencies changes the meaning or designation for
its
Applicable Ratings referenced in paragraph (a), the criteria for
Level
Status in the table in paragraph (a) shall be adjusted in such manner
as
the Required Lenders may reasonably determine to correspond with
the
applicable rating designations used by the applicable Rating Agency
in
effect on the date hereof.
|
|
(ii)
|
If
one of the Rating Agencies ceases to rate the Borrower’s long-term
unsecured debt such that only two of the Rating Agencies are providing
such Applicable Ratings, the Borrower’s Level Status shall be determined
as follows:
|
|
(A)
|
If
the Applicable Ratings provided by both of the remaining Rating Agencies
are in the same column, the Borrower’s Level Status shall be determined by
that column.
|
|
(B)
|
If
the Applicable Ratings provided by the remaining Rating Agencies
are in
adjacent columns, the Borrower’s Level Status shall be based on the
leftmost of the columns.
|
|
(C)
|
If
the Applicable Ratings provided by the remaining Rating Agencies
are
separated by one or more columns, the Borrower’s Level Status shall be
based on the column to the immediate right of the leftmost applicable
column.
|
Notwithstanding
the foregoing, if the Applicable Rating established by either of the remaining
Rating Agencies is in the rightmost column above, the Borrower shall be deemed
to be at Level Status V.
|
(iii)
|
If
any two of the Rating Agencies ceases to establish its Applicable
Rating,
the Borrower shall be deemed to be at Level Status
V.
|
(c) The
Floating Rate Margin, LIBO Rate Margin and Facility Fee Rate at any time shall
be determined from time to time on the basis of the Borrower’s Level Status, in
accordance with the following table:
|
▇▇▇▇▇
▇
|
▇▇▇▇▇
▇▇
|
▇▇▇▇▇
▇▇▇
|
▇▇▇▇▇
▇▇
|
Level
V
|
|
|
Floating
Rate Margin
|
0%
|
0%
|
0%
|
0%
|
0%
|
|
LIBO
Rate Margin
|
0.200%
|
0.240%
|
0.305%
|
0.410%
|
0.600%
|
|
Facility
Fee Rate
|
0.050%
|
0.060%
|
0.070%
|
0.090%
|
0.150%
|
(d) Upon
the
occurrence of any Default or Event of Default, and so long as such Default
or
Event of Default continues without written waiver thereof by the Lenders, a
default increment equal to 200 basis points (2.00%) shall be added to the
Floating Rate Margin and LIBO Rate Margin. Inclusion of such default increment
shall not be deemed a waiver or excuse of any such Default or Event of Default.
Section
2.6 Fees.
(a) Facility
Fee.
The
Borrower shall pay to the Agent, for the ratable benefit of the Lenders, a
facility fee determined at an annual rate equal to the then-applicable Facility
Fee Rate applied to the average aggregate Credit Exposure during such calendar
quarter (or during such shorter period ending on the Maturity Date). The
facility fee shall be due and payable quarterly in arrears on the last day
of
each calendar quarter, and on the Maturity Date. The facility fee shall accrue
at all times, including at any time during which any condition in Article III
has not been satisfied.
(b) Fee
Letters.
The
Borrower shall pay to the Agent all fees required to be paid pursuant to any
Fee
Letters.
(c) Audit
Fees.
Upon
the occurrence of an Event of Default or at any time thereafter until such
Event
of Default is cured, the Borrower shall pay to the Agent, on written demand,
reasonable fees charged by the Agent in connection with any audits or
inspections by the Agent of any collateral or the operations or businesses
of
the Borrower, together with actual out-of-pocket costs and expenses incurred
in
conducting any such audit or inspection. All such audits and inspections shall
be for the sole benefit of the Agent and the Lenders.
Section
2.7 Prepayments.
(a) Voluntary
Prepayments.
The
Borrower from time to time may voluntarily prepay the Notes in whole or in
part;
provided that (i) prepayment of any Lender’s Note must be accompanied by
pro rata prepayment of each other Lender’s Note, (ii) any prepayment of the
full amount of any Note shall include accrued interest thereon,
(iii) partial prepayment of any Floating Rate Funding shall be in an
aggregate amount not less than $1,000,000, (iv) partial prepayment of any
LIBO Rate Funding shall be in an aggregate amount not less than $5,000,000,
and
(v) any prepayment of any LIBO Rate Funding shall be made only upon three
Business Days’ notice to the Agent.
(b) Mandatory
Prepayment.
|
(i)
|
Promptly
following the receipt by the Borrower or any Subsidiary of proceeds
from
the sale by Centennial Energy Resources LLC or any other Subsidiary
of the
Capital Stock or assets of Centennial Power, Inc. or Colorado Energy
Management, LLC, the Borrower shall prepay the Obligations in an
amount
equal to such proceeds; provided, however, that the aggregate amount
required to be prepaid under this paragraph (i) shall not exceed
the
lesser of (A) $220,000,000, or (B) the then-outstanding
Obligations.
|
|
(ii)
|
Promptly
following the receipt thereof, the Borrower shall prepay the Obligations
in an amount equal to 100% of the net proceeds realized by the Borrower
or
Cascade DebtCo from (A) debt obligations incurred by the Borrower or
Cascade DebtCo after the date hereof (other than hereunder), or
(B) the issuance by the Borrower or Cascade DebtCo of Capital Stock;
provided, however, that the aggregate amount required to be paid
under
this paragraph (ii) shall not exceed the then-outstanding Obligations.
|
(c) Application
of Prepayments.
So
long
as no Default or Event of Default has occurred and is continuing hereunder,
all
prepayments hereunder shall be applied in such order of application as the
Borrower may direct in writing. In all other cases, all prepayments hereunder
shall be applied in the following order:
|
(i)
|
First,
to the principal balance of the
Notes.
|
|
(ii)
|
Second,
to accrued but unpaid interest on the
Notes.
|
|
(iii)
|
Third,
to any
remaining Obligations, in such order as the Agent may in its sole
discretion designate.
|
Notwithstanding
the foregoing, interest on any LIBO Rate Funding prepaid hereunder and any
compensation due under Section 2.10
on
account of prepayment of a LIBO Rate Funding shall be paid with the same
priority as the related principal prepayment.
Section
2.8 Payments.
(a) Making
of Payments.
All
payments of principal of and interest due under the Notes shall be made to
the
Agent at its principal office in Minneapolis, Minnesota, not later than 12:00
noon on the date due, in immediately available funds, and funds received after
that hour shall be deemed to have been received by the Agent on the next
following Business Day. The Borrower hereby authorizes the Agent to charge
the
Borrower’s demand deposit account maintained with the Agent for the amount of
any such payment on its due date, all without receipt of any request for such
charge, but the Lender’s failure to so charge such account shall in no way
affect the obligation of the Borrower to make any such payment.
(b) Assumed
Payments.
Unless
the Agent has been notified by a Lender or the Borrower prior to the date on
which such Lender or the Borrower is scheduled to make payment to the Agent
of
(in the case of a Lender) its Percentage of the Term Loan or (in the case of
the
Borrower) a payment to the Agent for the account of one or more of the Lenders
hereunder (such payment by a Lender or the Borrower (as the case may be) being
herein called a “Required Payment”), which notice shall be effective upon
receipt, that it does not intend to make the Required Payment to the Agent,
the
Agent may assume that the Required Payment has been made and may (but shall
not
be required to), in reliance upon such assumption, make the amount thereof
available to the intended recipient on such date and, if such Lender or the
Borrower (as the case may be) has not in fact made the Required Payment to
the
Agent, the recipient of such payment shall, on demand, repay to the Agent the
amount so made available together with interest thereon for each day during
the
period commencing on the date such amount was so made available by the Agent
until the date the Agent recovers such amount at a rate (i) equal to the Federal
Funds Rate for such day, in the case of a Required Payment owing by a Lender,
or
(ii) equal to the applicable rate of interest as provided in this Agreement,
in
the case of a Required Payment owing by the Borrower.
(c) Setoff.
The
Borrower agrees that each Lender shall have all rights of setoff and bankers’
lien provided by applicable law, and in addition thereto, the Borrower agrees
that if at any time any amount is due and owing by the Borrower under this
Agreement to any Lender at a time when an Event of Default has occurred and
is
continuing hereunder, any Lender may apply any and all balances, credits, and
deposits, accounts or moneys of the Borrower then or thereafter in the
possession of that Lender (excluding, however, any trust or escrow accounts
held
by the Borrower for the benefit of any third party) to the payment
thereof.
(d) Due
Date Extension.
If any
payment of principal of or interest on any Floating Rate Funding or any fees
payable hereunder falls due on a day which is not a Business Day, then such
due
date shall be extended to the next following Business Day, and (in the case
of
principal) additional interest shall accrue and be payable for the period of
such extension.
(e) Application
of Payments.
Except
as otherwise provided herein, so long as no Default or Event of Default has
occurred and is continuing hereunder, each payment received from the Borrower
shall be applied to such obligation as the Borrower shall specify by notice
received by the Agent on or before the date of such payment, or in the absence
of such notice, as the Required Lenders shall determine in their discretion.
Except as otherwise provided herein, after the occurrence of a Default or Event
of Default, the Lenders shall have the right to apply all payments received
by
the Lender from the Borrower as the Required Lenders may determine in their
discretion. The Borrower agrees that the amount shown on the books and records
of the Agent and the Lenders as being the principal balance of and interest
on
the Notes shall be conclusive absent demonstrable error.
Section
2.9 Increased
Costs; Funding Exceptions.
(a) Increased
Costs on LIBO Rate Fundings.
If
Regulation D of the Board of Governors of the Federal Reserve System or after
the date of this Agreement the adoption of any applicable law, rule or
regulation, or any change in any existing law, or any change in the
interpretation or administration thereof by any governmental authority, central
bank or comparable agency charged with the interpretation or administration
thereof, or compliance by any Lender with any request or directive (whether
or
not having the force of law) of any such authority, central bank or comparable
agency, shall:
|
(i)
|
subject
that Lender to or cause the withdrawal or termination of any exemption
previously granted to that Lender with respect to, any tax, duty
or other
charge with respect to its LIBO Rate Fundings or its obligation to
make
LIBO Rate Fundings, or shall change the basis of taxation of payments
to
that Lender of the principal of or interest under this Agreement
in
respect of its LIBO Rate Fundings or its obligation to make LIBO
Rate
Fundings (except for changes in the rate of tax on the overall net
income
of that Lender imposed by the jurisdictions in which that Lender’s
principal executive office is located);
or
|
|
(ii)
|
impose,
modify or deem applicable any reserve (including, without limitation,
any
reserve imposed by the Board of Governors of the Federal Reserve
System,
but excluding any reserve included in the determination of interest
rates
pursuant to Section 2.3), special deposit or similar requirement
against
assets of, deposits with or for the account of, or credit extended
by,
that Lender; or
|
|
(iii)
|
impose
on that Lender any other condition affecting its making, maintaining
or
funding of its LIBO Rate Fundings or its obligation to make LIBO
Rate
Fundings;
|
and
the
result of any of the foregoing is to increase the cost to that Lender of making
or maintaining any LIBO Rate Funding, or to reduce the amount of any sum
received or receivable by that Lender under this Agreement or under its Notes
with respect to a LIBO Rate Funding, then that Lender will notify the Borrower
of such increased cost and within fifteen (15) days after demand by that Lender
(which demand shall be accompanied by a statement setting forth the basis of
such demand and representing that that Lender has made similar demand on one
or
more other commercial borrowers with revolving or term loans in excess of
$1,000,000) the Borrower shall pay to that Lender such additional amount or
amounts as will compensate that Lender for such increased cost or such
reduction; provided, however, that no such increased cost or such reduction
shall be payable by the Borrower for any period longer than ninety (90) days
prior to the date on which notice thereof is delivered to the Borrower. Each
Lender will promptly notify the Borrower of any event of which it has knowledge,
occurring after the date hereof, which will entitle that Lender to compensation
pursuant to this Section 2.9. If the Borrower receives notice from any Lender
of
any event which will entitle that Lender to compensation pursuant to this
Section 2.9, the Borrower may prepay any then outstanding LIBO Rate Fundings
or
notify that Lender that any pending request for a LIBO Rate Funding shall be
deemed to be a request for a Floating Rate Funding, in each case subject to
the
provisions of Section 2.10.
(b) Basis
for Determining Interest Rate Inadequate or Unfair.
If with
respect to any Interest Period:
|
(i)
|
any
Lender determines that deposits in U.S. dollars (in the applicable
amounts) are not being offered in the London interbank eurodollar
market
for such Interest Period; or
|
|
(ii)
|
any
Lender otherwise determines that by reason of circumstances affecting
the
London interbank eurodollar market adequate and reasonable means
do not
exist for ascertaining the applicable LIBO Rate;
or
|
|
(iii)
|
any
Lender determines that the LIBO Rate as determined by the Agent will
not
adequately and fairly reflect the cost to that Lender of maintaining
or
funding a LIBO Rate Funding for such Interest Period, or that the
making
or funding of LIBO Rate Fundings has become impracticable as a result
of
an event occurring after the date of this Agreement which in the
opinion
of that Lender materially affects such LIBO Rate Fundings;
|
then
that
Lender shall promptly notify the Borrower and (A) upon the occurrence of any
event described in the foregoing clause (i) the Borrower shall enter into good
faith negotiations with that Lender in order to determine an alternate method
to
determine the LIBO Rate for that Lender, and during the pendency of such
negotiations with that Lender, the Lenders shall be under no obligation to
make
any new LIBO Rate Fundings, and (B) upon the occurrence of any event described
in the foregoing clauses (ii) or (iii), for so long as such circumstances shall
continue, the Lenders shall be under no obligation to make any new LIBO Rate
Fundings.
(c) Illegality.
If any
change in (including the adoption of any new) applicable laws or regulations,
or
any change in the interpretation of applicable laws or regulations by any
governmental authority, central bank, comparable agency or any other regulatory
body charged with the interpretation, implementation or administration thereof,
or compliance by any Lender with any request or directive (whether or not having
the force of law) of any such authority, central bank, comparable agency or
other regulatory body, should make it or, in the good faith judgment of that
Lender, shall raise a substantial question as to whether it is unlawful for
that
Lender to make, maintain or fund LIBO Rate Fundings, then (i) that Lender shall
promptly notify the Borrower and the Agent, (ii) the obligation of the Lenders
to make, maintain or convert into LIBO Rate Fundings shall, upon the
effectiveness of such event, be suspended for the duration of such unlawfulness,
and (iii) for the duration of such unlawfulness, any notice by the Borrower
requesting the Lenders to make or convert into LIBO Rate Fundings shall be
construed as a request to make or to continue making Floating Rate Fundings.
Section
2.10 Funding
Losses.
Upon
demand by any Lender (which demand shall be accompanied by a statement setting
forth the basis for the calculations of the amount being claimed), the Borrower
shall indemnify that Lender against any loss or expense which that Lender may
have sustained or incurred (including, without limitation, any net loss or
expense incurred by reason of the liquidation or reemployment of deposits or
other funds acquired by that Lender to fund or maintain LIBO Rate Fundings)
or
which that Lender may be deemed to have sustained or incurred, as reasonably
determined by that Lender, (i) as a consequence of any failure by the Borrower
to make any payment when due of any amount due hereunder in connection with
any
LIBO Rate Fundings, (ii) due to any failure of the Borrower to borrow or convert
any LIBO Rate Fundings on a date specified therefor in a notice thereof or
(iii)
due to any payment or prepayment of any LIBO Rate Funding on a date other than
the last day of the applicable Interest Period for such LIBO Rate Funding.
For
this purpose, all notices under Section 2.3(b) shall be deemed to be
irrevocable.
Section
2.11 Discretion
of Lenders as to Manner of Funding.
Notwithstanding
any provision of this Agreement to the contrary, each Lender shall be entitled
to fund and maintain all or any part of its LIBO Rate Fundings in any manner
it
deems fit, it being understood, however, that for the purposes of this Agreement
(specifically including, without limitation, Section 2.10 hereof) all
determinations hereunder shall be made as if that Lender had actually funded
and
maintained each LIBO Rate Funding during each Interest Period for such LIBO
Rate
Funding through the purchase of deposits having a maturity corresponding to
such
Interest Period and bearing an interest rate equal to the appropriate LIBO
Rate
for such Interest Period.
Section
2.12 Conclusiveness
of Statements; Survival of Provisions.
Determinations
and statements of any Lender pursuant to Sections 2.9 and 2.10 shall be
conclusive absent demonstrable error. Without limiting the generality of the
foregoing, the Borrower shall have no right to review any records of any Lender
or its other customers to determine the accuracy of any statement by that Lender
under Section 2.9(a) regarding that Lender’s demands upon other customers
of that Lender. Each Lender may use reasonable averaging and attribution methods
in determining compensation pursuant to such Sections 2.9 and 2.10 and the
provisions of Sections 2.9 and 2.10 shall survive termination of this
Agreement.
Section
2.13 Computation
of Interest and Fees.
All
interest determined at the Floating Rate will be calculated based on the actual
days elapsed in a year of 365 or 366 days, as the case may be. All interest
determined at the LIBO Rate and all fees hereunder shall be computed on the
basis of actual number of days elapsed in a year of 360 days.
Section
2.14 Purpose
of Term Loan.
The
proceeds of the Term Loan shall be used to finance the Cascade Acquisition
and
pay related transactional costs.
ARTICLE
III
Conditions
Precedent
Section
3.1 Required
Deliveries.
The
obligation of the Lenders to make the Term Loan is subject to the condition
precedent that each Lender shall have received on or before the day of the
Term
Loan all of the following, each dated (unless otherwise indicated) as of the
date hereof, in form and substance satisfactory to each Lender:
(a) The
Notes, properly executed on behalf of the Borrower.
(b) A
certificate of the secretary of the Borrower (i) certifying that the
execution, delivery and performance of the Loan Documents and other documents
contemplated hereunder to which such corporation is a party have been duly
approved by all necessary action of the Board of Directors of the Borrower,
and
attaching true and correct copies of the applicable resolutions granting such
approval, (ii) certifying that attached to such certificate are true and
correct copies of the articles of incorporation and bylaws of the Borrower
and
all Authorizing Orders, together with such copies, and (iii) certifying the
names of the officers of the Borrower that are authorized to sign the Loan
Documents and other documents contemplated hereunder, together with the true
signatures of such officers. The Lenders may conclusively rely on such
certificate until they shall receive a further certificate of the Secretary
or
Assistant Secretary of the Borrower canceling or amending the prior certificate
and submitting the signatures of the officers named in such further
certificate.
(c) Certificates
of good standing of the Borrower, dated not more than ten days before such
date.
(d) A
signed
copies of an opinion of ▇▇▇▇ ▇. ▇▇▇▇▇▇▇▇, general counsel for the Borrower,
substantially in the form of Exhibit E-1, and the opinion of ▇▇▇▇▇▇ ▇▇▇▇ ▇▇▇▇▇
Raysman & ▇▇▇▇▇▇▇ LLP, special counsel to the Borrower, substantially in the
form of Exhibit E-2, each addressed to the Lenders.
(e) A
certificate, duly executed by the chief financial officer of the Borrower,
in
the form of Exhibit F.
(f) All
fees
required to be paid as of the date hereof pursuant to this Agreement or any
Fee
Letter.
Section
3.2 Additional
Conditions Precedent.
The
obligation of the Lenders to make the Term Loan shall be subject to the further
conditions precedent that on the date of the Term Loan:
(a) The
representations and warranties contained in Article IV (other than Section
4.6)
are correct on and as of the date of the Term Loan as though made on and as
of
such date, except to the extent that such representations and warranties relate
solely to an earlier date.
(b) No
event
has occurred and is continuing, or would result from the Term Loan, which
constitutes a Default or an Event of Default.
ARTICLE
IV
Representations
and Warranties
The
Borrower represents and warrants to the Lenders as follows:
Section
4.1 Existence
and Power.
The
Borrower is a corporation duly incorporated, validly existing and in good
standing under the laws of Delaware, and is duly licensed or qualified to
transact business in all jurisdictions where the character of the property
owned
or leased or the nature of the business transacted by it makes such licensing
or
qualification necessary, except where the failure to be so licensed or qualified
(i) will not permanently preclude the Borrower from maintaining any
material action in any such jurisdiction even though such action arose in whole
or in part during the period of such failure, and (ii) will not result in
any other Material Adverse Effect. The Borrower has all requisite power and
authority, corporate or otherwise, to conduct its business, to own its
properties and to execute and deliver, and to perform all of its obligations
under, the Loan Documents.
Section
4.2 Authorization
of Borrowing; No Conflict as to Law or Agreements.
The
execution, delivery and performance by the Borrower of the Loan Documents and
the borrowing hereunder have been duly authorized by all necessary corporate
action and by all necessary public utilities commissions and any other
regulatory bodies having jurisdiction over the Borrower, and do not and will
not
(i) require any consent or approval of the stockholders of the Borrower, or
any authorization, consent or approval by any governmental department,
commission, board, bureau, agency or instrumentality, domestic or foreign,
other
than Authorizing Orders set forth in Schedule 4.2 that have been obtained and
copies of which have been delivered to the Agent pursuant to Section 3.1,
(ii) violate any provision of any law, rule or regulation (including,
without limitation, Regulation X of the Board of Governors of the Federal
Reserve System) or of any order, writ, injunction or decree presently in effect
having applicability to the Borrower or of the articles of incorporation or
bylaws of the Borrower, (iii) result in a breach of or constitute a default
under any indenture or loan or credit agreement or any other agreement, lease
or
instrument to which the Borrower is a party or by which it or its properties
may
be bound or affected, or (iv) result in, or require, the creation or
imposition of any Lien or other charge or encumbrance of any nature (other
than
those in favor of the Agent to secure one or more of the Obligations) upon
or
with respect to any of the properties now owned or hereafter acquired by the
Borrower.
Section
4.3 Legal
Agreements.
This
Agreement and the other Loan Documents constitute the legal, valid and binding
obligations of the Borrower enforceable against the Borrower in accordance
with
their respective terms, except to the extent that such enforcement may be
limited by bankruptcy, insolvency or similar laws affecting the enforcement
of
creditors’ rights generally or by general equitable principles.
Section
4.4 Subsidiaries.
Schedule
4.4 hereto is a complete and correct list of all present Subsidiaries and of
the
percentage of the ownership of the Borrower or any other Subsidiary in each
case
as of the date of this Agreement. Except as otherwise indicated in that
Schedule, all shares of each Subsidiary owned by the Borrower or by any such
other Subsidiary are validly issued and fully paid and nonassessable.
Section
4.5 Financial
Condition.
The
Borrower has heretofore furnished to the Lenders its audited consolidated
financial statement as of December 31, 2006, and its unaudited interim financial
statement as of March 31, 2007. Those financial statements fairly present the
financial condition of the Borrower and its Subsidiaries on the dates thereof
and the results of their operations and cash flows for the periods then ended,
and were prepared in accordance with GAAP, except as expressly noted
therein.
Section
4.6 Adverse
Change.
There
has
been no material adverse change in the business, properties or condition
(financial or otherwise) of the Borrower since the date of the latest financial
statement referred to in Section 4.5.
Section
4.7 Litigation.
Except
as
set forth in the Borrower’s Annual Report on Form 10-K for the year ended
December 31, 2006, or in any document subsequently filed pursuant to Section
13,
14 or 15(d) of the Exchange Act, there are no actions, suits or proceedings
pending or, to the knowledge of the Borrower, threatened against or affecting
the Borrower or the properties of the Borrower, before any court or governmental
department, commission, board, bureau, agency or instrumentality, domestic
or
foreign, which, if determined adversely to the Borrower, would have a Material
Adverse Effect.
Section
4.8 Environmental
Matters.
The
Borrower conducts in the ordinary course of business a review of the effect
of
existing Environmental Laws and existing Environmental Claims on its business,
operations and properties and, as a result thereof, the Borrower has reasonably
concluded that such Environmental Laws and Environmental Claims could not,
individually or in the aggregate, reasonably be expected to have a Material
Adverse Effect, exclusive of Environmental Claims as set forth in the Borrower’s
Annual Report on Form 10-K for the year ended December 31, 2006, or in any
document subsequently filed pursuant to Section 13, 14 or 15(d) of the Exchange
Act.
Section
4.9 Regulation
U.
The
Borrower is not engaged in the business of extending credit for the purpose
of
purchasing or carrying margin stock (within the meaning of Regulation U of
the
Board of Governors of the Federal Reserve System), and no part of the proceeds
of the Term Loan will be used to purchase or carry any margin stock or to extend
credit to others for the purpose of purchasing or carrying any margin
stock.
Section
4.10 Taxes.
The
Borrower has filed all federal and other tax returns and reports required to
be
filed, and has paid all federal and other taxes, assessments, fees and other
governmental charges levied or imposed upon it or its properties, income or
assets otherwise due and payable, except those which are being contested in
good
faith by appropriate proceedings and for which adequate reserves have been
provided in accordance with GAAP and except those the failure to file or pay
which would not have a Material Adverse Effect. There is no proposed tax
assessment against the Borrower that would, if made, have a Material Adverse
Effect.
Section
4.11 Titles
and Liens.
To
the
Borrower’s knowledge, without having undertaken any search of real property
records for this purpose, the Borrower has good and sufficient title to, or
valid leasehold interests in, all real property necessary or used in the
ordinary conduct of its business, and good title to all other property and
assets reflected in the Borrower’s most recent consolidated financial statements
provided to the Lenders as owned by the Borrower, except for such defects in
title as could not, individually or in the aggregate, reasonably be expected
to
have a Material Adverse Effect and other than any sold, as permitted by Section
6.4. As of the date of this Agreement, the property of the Borrower is subject
to no Liens other than a permitted pursuant to Section 6.1.
Section
4.12 Intellectual
Property.
The
Borrower owns or is licensed or otherwise has the right to use all of the
patents, trademarks, service marks, trade names, copyrights, contractual
franchises, authorizations and other rights that are reasonably necessary for
the operation of its business, without conflict with the rights of any other
Person, except to the extent that noncompliance would not have a Material
Adverse Effect. To the knowledge of the Borrower, no slogan or other advertising
device, product, process, method, substance, part or other material now
employed, or now contemplated to be employed, by the Borrower infringes upon
any
rights held by any other Person, except to the extent that noncompliance would
not have a Material Adverse Effect. No claim or litigation regarding any of
the
foregoing is pending or threatened, and no patent, invention, device,
application, principle or any statute, law, rule, regulation, standard or code
is pending or, to the knowledge of the Borrower, proposed, which, in either
case, could reasonably be expected to have a Material Adverse
Effect.
Section
4.13 ERISA.
(a) Each
Plan
is in compliance in all material respects with ERISA, the Code and other
applicable federal or state law. Each Plan which is intended to qualify under
Section 401(a) of the Code has received a favorable determination letter from
the Internal Revenue Service and, to the best knowledge of the Borrower, nothing
has occurred which would or could reasonably be expected to cause the loss
of such
qualification of any
such
Plan or related trust.
(b) There
are
no pending or, to the best knowledge of the
Borrower, threatened claims (other than routine claims for benefits in the
ordinary course), actions or lawsuits, or action by any governmental authority,
with respect to any Plan which has resulted or could reasonably be expected
to
result in a Material Adverse Effect. To the best knowledge of the Borrower,
there has been no prohibited transaction within the meaning of Section 4975
of
the Code or Section 406 ERISA or other material violation of the fiduciary
responsibility rules with respect to any Plan which has resulted or could
reasonably be expected to result in a Material Adverse Effect.
(c) No
Reportable Event has occurred or is reasonably expected to occur with respect
to
any Pension Plan.
(d) The
aggregate Unfunded Pension Liability for all Pension Plans (calculated based
on
the most recent actuarial report for each Pension Plan) does not exceed
$25,000,000.
(e) Neither
the Borrower nor any ERISA Affiliate has incurred nor does it reasonably expect
to incur, any liability under Title IV of ERISA with respect to any Pension
Plan
(other than premiums due and not delinquent under Section 4007 of
ERISA).
(f) Neither
the Borrower nor any ERISA Affiliate has transferred any Unfunded Pension
Liability to any Person or otherwise engaged in a transaction that could be
subject to Section 4069 of ERISA.
(g) Neither
the Borrower nor any ERISA Affiliate has incurred nor reasonably expects to
incur any liability, other than Acquisition Liability (and no event has occurred
which, with the giving of notice under Section 4219 of ERISA, would result
in
such liability), under Section 4201 or 4243 of ERISA with respect to a
Multiemployer Plan. As used in this paragraph, “Acquisition Liability” means
liability immaterial to the Borrower, its business and operations when taken
as
a whole that is incurred in connection with an acquisition by the Borrower
or
any ERISA Affiliate.
ARTICLE
V
Affirmative
Covenants
So
long
as the Commitments remain outstanding or any Note shall remain unpaid, the
Borrower will comply with the following requirements, unless the Required
Lenders shall otherwise consent in writing:
Section
5.1 Reporting.
The
Borrower will deliver to each Lender:
(a) As
soon
as available, and in any event within 120 days after the end of each fiscal
year
of the Borrower:
|
(i)
|
A
copy of the annual audit report of the Borrower and its Subsidiaries
prepared on a consolidated basis with an unqualified opinion of
independent certified public accountants selected by the Borrower
and
acceptable to the Required Lenders, which annual report shall include
the
consolidated balance sheets of the Borrower and its Subsidiaries
as of the
end of such fiscal year and the related consolidated statements of
income,
common stockholders’ equity and cash flows of the Borrower and its
Subsidiaries for the fiscal year then ended, all in reasonable detail
and
all prepared in accordance with GAAP.
|
|
(ii)
|
A
copy of the unaudited nonconsolidated balance sheets of the Borrower
at
the end of such fiscal year and the related unaudited nonconsolidated
statements of income, retained earnings and cash flows of the Borrower
for
such fiscal year, in reasonable detail, all prepared in accordance
with
GAAP.
|
|
(iii)
|
A
copy of the annual audit report-regulatory basis of the Borrower
with an
unqualified opinion of independent certified public accountants selected
by the Borrower and acceptable to the Required Lenders, which annual
report shall include a copy of the balance sheet-regulatory basis
of the
Borrower as the end of such fiscal year and the related statements
of
income-regulatory basis, retained earnings-regulatory basis and cash
flows-regulatory basis of the Borrower for the fiscal year then ended,
all
prepared in accordance with FERC Accounting Principles.
|
(b) As
soon
as available and in any event within 60 days after the end of each fiscal
quarter of the Borrower:
|
(i)
|
A
copy of (A) the unaudited consolidated balance sheets of the Borrower
and its Subsidiaries as of the end of such quarter, (B) the related
unaudited consolidated statements of income for such quarter, and
(C) the related unaudited consolidated statements of income and cash
flows of the Borrower and its Subsidiaries for the year to date,
all in
reasonable detail and prepared in accordance with GAAP, subject to
year-end audit adjustments.
|
|
(ii)
|
A
copy of (A) the unaudited nonconsolidated balance sheets of the
Borrower at the end of such quarter, (B) the related unaudited
nonconsolidated statements of income for such quarter, and (C) the
related unaudited nonconsolidated statements of income, retained
earnings
and cash flows of the Borrower for the year to date, all in reasonable
detail and prepared in accordance with GAAP, subject to year-end
adjustments.
|
|
(iii)
|
A
narrative report setting forth the Borrower’s progress in effecting
transactions that would require a mandatory prepayment of the Obligations
pursuant to Section 2.7(b).
|
(c) Concurrently
with the delivery of any financial statements under paragraph (a) or (b), a
Compliance Certificate, duly executed by the chief financial officer of the
Borrower.
(d) Promptly
following the issuance thereof, a copy of any Authorizing Order not previously
delivered to the Agent.
(e) Promptly
upon their distribution, copies of all financial statements, reports and proxy
statements which the Borrower shall have sent to its stockholders.
(f) Promptly
after the sending or filing thereof, copies of all regular and periodic
financial reports which the Borrower shall file with the Securities and Exchange
Commission or any national securities exchange.
(g) Promptly
upon becoming available, copies of any reports or applications filed by the
Borrower with any governmental body if such reports indicate any material change
in the business, operations, affairs or condition of the Borrower, or if copies
thereof are requested by any Lender.
(h) Immediately
after the commencement thereof, notice in writing of all litigation and of
all
proceedings before any governmental or regulatory agency affecting the Borrower
of the type described in Section 4.7 or which seek a monetary recovery against
the Borrower in excess of $1,000,000.
(i) As
promptly as practicable (but in any event not later than five business days)
after an officer of the Borrower obtains knowledge of the occurrence of any
Default or Event of Default, notice of such occurrence, together with a detailed
statement by a responsible officer of the Borrower of the steps being taken
by
the Borrower to cure the effect of such event.
(j) Promptly
upon becoming aware of an ERISA Event (other than an event described in clause
(c) of the definition of “ERISA Event” which has not resulted and would not
reasonably be expected to result in a Material Adverse Effect), a written notice
specifying the nature thereof, what action the Borrower has taken, is taking
or
proposes to take with respect thereto, and, when known, any action taken or
threatened by the Internal Revenue Service, the PBGC or the Department of Labor
with respect thereto.
(k) Promptly
upon (i) the adoption of any Plan subject to Section 412 of the Code, or (ii)
the adoption of any amendment to a Pension Plan or other Plan subject to Section
412 of the Code, if such amendment results in a material increase in
contributions or Unfunded Pension Liability, written notice specifying the
nature thereof.
(l) Upon
request of any Lender, copies of the most recent annual report (Form 5500
Series), including any supporting schedules, filed by the Borrower or any ERISA
Affiliate with the Internal Revenue Service with respect to any
Plan.
(m) Such
information (in addition to that specified elsewhere in this Section) respecting
the financial condition and results of operations of the Borrower as any Lender
may from time to time reasonably request.
Section
5.2 Books
and Records; Inspection and Examination.
The
Borrower will keep accurate books of record and account for itself in which
true
and complete entries will be made in accordance with GAAP and, upon request
of
any Lender, will give any representative of that Lender access to, and permit
such representative to examine, copy or make extracts from, any and all books,
records and documents in its possession, to inspect any of its properties and
to
discuss its affairs, finances and accounts with any of its principal officers,
all at such times during normal business hours and as often as any Lender may
reasonably request.
Section
5.3 Compliance
with Laws.
The
Borrower will comply with the requirements of applicable laws and regulations,
except any law and regulation (i) the compliance with which is contested in
good faith or the subject of a bona fide dispute, and (ii) the noncompliance
with which would not have a Material Adverse Effect. In addition, and without
limiting the foregoing sentence, the Borrower shall (i) ensure that no
Person who owns a controlling interest in or otherwise controls the Borrower
is
or shall be listed on the Specially Designated Nationals and Blocked Person
List
or other similar lists maintained by the Office of Foreign Assets Control
(“OFAC”), the Department of the Treasury or included in any Executive Orders,
(ii) not use or permit the use of the proceeds of the Term Loan to violate
any of the foreign asset control regulations of OFAC or any enabling statute
or
Executive Order relating thereto, and (iii) comply with all applicable Bank
Secrecy Act (“BSA”) laws and regulations, as amended.
Section
5.4 Payment
of Taxes and Other Claims.
The
Borrower will pay or discharge, when due, (a) all taxes, assessments and
governmental charges levied or imposed upon it or upon its income or profits,
or
upon any properties belonging to it, prior to the date on which penalties attach
thereto, (b) all federal, state and local taxes required to be withheld by
it, and (c) all lawful claims for labor, materials and supplies which, if
unpaid, might by law become a Lien or charge upon any properties of the
Borrower; provided, that the Borrower shall not be required to pay any such
tax,
assessment, charge or claim so long as (x) the amount, applicability or validity
of such tax, assessment, charge or claim is being contested in good faith by
appropriate proceedings or is the subject of a bona fide dispute, and
(y) the Borrower has provided adequate reserves therefor in accordance with
GAAP, except (with respect to any of the foregoing) to the extent that the
failure to do so could not reasonably be expected to have a Material Adverse
Effect.
Section
5.5 Maintenance
of Properties.
Subject
to transactions permitted by Sections 6.4, the Borrower shall maintain and
preserve all its property which is used or useful in its business in good
working order and condition, ordinary wear and tear excepted, except to the
extent that noncompliance would not have a Material Adverse Effect.
Section
5.6 Insurance.
The
Borrower shall maintain with financially sound and reputable independent
insurers, insurance with respect to its properties and business against loss
or
damage of the kinds customarily insured against by Persons engaged in the same
or similar business, of such types and in such amounts (including deductibles,
co-insurance and self-insurance, if adequate reserves are maintained with
respect thereto) as are customarily carried under similar circumstances by
such
other Persons, except to the extent that noncompliance would not have a Material
Adverse Effect, and the Borrower will furnish any Lender upon request full
information as to the insurance carried within 15 Business Days.
Section
5.7 Preservation
of Corporate Existence.
Subject
to transactions permitted by Section 6.4, the Borrower shall (i) preserve
and maintain in full force and effect its corporate existence and good standing
under the laws of its state or jurisdiction of incorporation; (ii) preserve
and maintain in full force and effect all governmental rights, privileges,
qualifications, permits, licenses and franchises necessary or desirable in
the
normal conduct of its business; and (iii) preserve its business
organization and goodwill; and (iv) preserve or renew all of its registered
patents, trademarks, trade names and service marks; except, in each case, to
the
extent that failure to do so does not have a Material Adverse
Effect.
Section
5.8 Replacement
Financing.
The
Borrower will incur debt (whether from a private placement, refinancing in
the
bank loan market or otherwise), issue equity or otherwise effect transactions
in
amounts sufficient to prepay the Term Loan in its entirety pursuant to Section
2.7(b) within a reasonable time after the date hereof.
ARTICLE
VI
Negative
Covenants
So
long
as the Commitments remain outstanding or any Note shall remain unpaid, the
Borrower agrees that, without the prior written consent of the Required
Lenders:
Section
6.1 Liens.
The
Borrower will not create, incur or suffer to exist any Lien in, of or on the
property of the Borrower, except:
(a) Liens
for
taxes, assessments of governmental charges or levies on its property if the
same
shall not at the time be delinquent or thereafter can be paid without penalty,
or are being contested in good faith and by appropriate
proceedings.
(b) Liens
imposed by law, such as carriers’, warehousemen’s and mechanics’ liens and other
similar liens arising in the ordinary course of business which secure payment
of
obligations not yet due and payable or remaining payable without penalty or
which are being contested in good faith by appropriate proceedings.
(c) Liens
arising out of pledges or deposits under worker’s compensation laws,
unemployment insurance, old age pensions, or other social security or retirement
benefits, or similar legislation.
(d) Utility
easements, buildings restrictions and such other encumbrances or charges against
real property as are of a nature generally existing with respect to properties
of a similar character and which do not in any material way affect the
marketability of the same or interference with the use thereof in the business
of the Borrower.
(e) Purchase
money Liens upon or in any property acquired or held by the Borrower in the
ordinary course of business, provided that (i) no such Lien is created
later than the 90th day following the acquisition or completion of construction
of such property by the Borrower, and (ii) no such Lien extends or shall
extend to or cover any property of the Borrower other than the property then
being acquired, fixed improvements then or thereafter erected thereon and
improvements and modifications thereto necessary to maintain such properties
in
working order.
(f) Liens
incurred or deposits made in the ordinary course of business to secure (or
to
obtain letters of credit that secure) the performance of tenders, statutory
obligations, surety bonds, appeal bonds, bids, leases (other than Capitalized
Leases), performance bonds, purchase, construction or sales contracts and other
similar obligations, in each case not incurred or made in connection with the
incurrence of any Obligation.
(g) Liens
resulting from judgments, unless such judgments are not discharged within 45
days; are not stayed pending appeal or otherwise being appropriately contested
in good faith; or are not discharged within 45 days after expiration of any
such
stay.
(h) Liens
created under or in connection with the Mortgage Indentures as such Mortgage
Indentures exist on the date hereof, without regard to any waiver, amendment,
modification or restatement thereof.
(i) Liens
permitted under the Mortgage Indentures as such Mortgage Indentures exist on
the
date hereof, without regard to any waiver, amendment, modification or
restatement thereof.
(j) Liens
on
any property of the Borrower (other than those described in subsection (e))
securing any indebtedness for borrowed money in existence on the date hereof
and
listed in Schedule 6.1 hereto.
Section
6.2 Investments.
The
Borrower will not purchase or hold beneficially any stock or other securities
or
evidence of indebtedness of, make or permit to exist any loans or advances
to,
or make any investment or acquire any interest whatsoever in, any other Person,
except:
(a) Investments
in cash equivalents and short-term marketable securities pursuant to and in
accordance with the terms of the Borrower’s then-current investment policy duly
adopted by the Board of Directors of the Borrower.
(b) Investments
in the MDU Resources Group, Inc. Benefits Protection Trust in accordance with
the Borrower’s historical practices.
(c) Any
existing investment by the Borrower in the voting stock, membership interests
or
other equity interests of any Subsidiary.
(d) Any
investment by the Borrower in any Subsidiary after the date hereof, so long
as
(i) the entire amount of such investment is obtained from (A) the
issuance of equity interests by the Borrower and/or (B) dividends or
similar distributions paid to the Borrower by any other Subsidiary of the
Borrower, in each case concurrent with the Borrower’s investment in such
Subsidiary, and (ii) no Default or Event of Default has occurred and is
continuing when such investment is actually made. In the case of any investment
funded as described in clause (i)(B), the applicable dividend or distribution
and the corresponding investment shall be accurately and completely reflected
on
the books and records of the Borrower and the applicable
Subsidiaries.
(e) Consolidations,
mergers and acquisitions not prohibited by Section 6.6.
(f) Travel,
relocation and similar advances made to officers and employees of the Borrower
in anticipation of expenses to be incurred by such officers and employees,
in
each case in the ordinary course of the Borrower’s business consistent with the
Borrower’s past practices.
(g) Advances
in the form of progress payments, prepaid rent or security
deposits.
(h) Evidences
of indebtedness in the nature of accounts receivable or notes receivable arising
from the sale or lease of goods or services in the ordinary course of
business.
(i) Investments
made for the purpose of economic development, so long as the aggregate value
of
the investments permitted by this clause (i) does not exceed
$10,000,000.
Section
6.3 Distributions.
The
Borrower will not make any Distribution at any time following and during the
continuance of any Default or Event of Default arising under paragraph (a),
(b),
(h) or (i) of Section 7.1.
Section
6.4 Sale
of Assets.
The
Borrower will not lease, sell or otherwise dispose of all, or a substantial
portion of, its property, assets or business (whether in one transaction or
in a
series of transactions) to any other Person except for sales of inventory in
the
ordinary course of business. For purposes of this Section, “substantial portion”
means assets (including other Persons) (i) representing more than 20% of the
consolidated assets of the Borrower as reflected in the most recent
consolidating financial statement of the Borrower referred to in Section 4.5,
or
(ii) responsible for more than 10% of the consolidated net sales or the
consolidated net income of the Borrower as reflected in the financial statement
referred to in clause (i) above.
Section
6.5 Transactions
with Affiliates.
The
Borrower shall not enter into any material transaction or arrangement or series
of related transactions or arrangements that in the aggregate would be material
with any Affiliate of the Borrower, except (i) transactions upon terms no
less favorable to the Borrower than would obtain, taking into account all facts
and circumstances, in a comparable arm’s-length transaction with a Person not an
Affiliate of the Borrower, (ii) investments in Subsidiaries to the extent
not prohibited by Section 6.2, (iii) Distributions to the extent not
prohibited by Section 6.3, and (iv) payments required by regulatory rule or
order; in the case of clauses (i), (ii) and (iii), to the extent that such
payments are (x) made in the ordinary course of the Borrower’s business,
(y) consistent with the Borrower’s past practices, and (z) fair and
reasonable.
Section
6.6 Consolidation
and Merger.
The
Borrower will not consolidate with or merge into any Person, or permit any
other
Person to merge into it, or acquire (in a transaction analogous in purpose
or
effect to a consolidation or merger) all or substantially all of the assets
of
any other Person or any existing business (whether existing as a separate
entity, subsidiary, division, unit, line of business or otherwise) of any
Person; provided, however, that the restrictions contained in this Section
shall
not apply to or prevent the consolidation or merger of any Person with, or
a
conveyance or transfer of its assets to, the Borrower so long as (i) no
Default or Event of Default exists at the time of, or will be caused by, such
consolidation, merger, conveyance or transfer, (ii) the Borrower shall be
the continuing or surviving corporation, and (iii) the prior, effective
written consent or approval of the board of directors or equivalent governing
body of the other party to such consolidation, merger, conveyance or transfer
is
obtained.
Section
6.7 Environmental
Laws.
The
Borrower will not cause or permit the conduct of its operations or the
maintenance of any of its property to violate any Environmental Law, except
to
the extent that noncompliance would not have a Material Adverse
Effect.
Section
6.8 Restrictions
on Nature of Business.
The
Borrower will not engage in any material line of business that is significantly
different from that presently engaged in by the Borrower.
Section
6.9 Consolidated
Total Leverage Ratio.
The
Borrower will not at any time permit its Consolidated Total Leverage Ratio,
determined as of any Covenant Compliance Date, to be greater than 0.65 to
1.
Section
6.10 Borrower
Leverage Ratio.
The
Borrower will not at any time permit the Borrower Leverage Ratio, determined
as
of any Covenant Compliance Date, to be greater than 0.65 to 1.
Section
6.11 Interest
Coverage Ratio.
The
Borrower will not at any time permit its Interest Coverage Ratio, determined
as
of any Covenant Compliance Date, to be less than 2.50 to 1.
ARTICLE
VII
Events
of Default, Rights and Remedies
Section
7.1 Events
of Default.
“Event
of
Default”, wherever used herein, means any one of the following
events:
(a) Default
in the payment of any principal of any Note when it becomes due and
payable.
(b) Default
in the payment of any interest on any Note when the same becomes due and payable
and the continuance of such default for a period of two calendar days; or
default in the payment of any fees required under Section 2.6 when the same
become due and payable and the continuance of such default for a period of
five
calendar days.
(c) Default
in the performance, or breach, of any covenant or agreement on the part of
the
Borrower contained in Article VI.
(d) Default
in the performance, or breach, of any covenant or agreement of the Borrower
in
this Agreement (other than a covenant or agreement a default in whose
performance or whose breach is elsewhere in this Section specifically dealt
with), and the continuance of such default or breach for a period of 30 days
after the Lenders have given notice to the Borrower specifying such default
or
breach and requiring it to be remedied.
(e) Any
representation or warranty made by the Borrower in this Agreement or by the
Borrower (or any of its officers) in any certificate, instrument, or statement
contemplated by or made or delivered pursuant to or in connection with this
Agreement, shall prove to have been incorrect or misleading in any material
respect when made.
(f) An
Event
of Default, as defined in the 2005 Credit Agreement, shall occur.
(g) A
default
under either Mortgage Indenture or with respect to any other Funded Debt (other
than any default dealt with elsewhere in this Section) and the expiration of
the
applicable period of grace, if any, specified in the applicable evidence of
indebtedness, indenture or other instrument; provided, however, that no Event
of
Default shall be deemed to have occurred under this paragraph if the aggregate
amount owing as to all such indebtedness as to which such defaults have occurred
and are continuing is less than $15,000,000; provided further that if such
default shall be cured by the Borrower, or waived by the holders of such
indebtedness, in each case prior to the commencement of any action under Section
7.2 and as may be permitted by such evidence of indebtedness, indenture or
other
instrument, then the Event of Default hereunder by reason of such default shall
be deemed likewise to have been thereupon cured or waived.
(h) The
Borrower (i) ceases or fails to be Solvent, or generally fails to pay, or admits
in writing its inability to pay, its debts as they become due, subject to
applicable grace periods, if any, whether at stated maturity or otherwise;
(ii) voluntarily ceases to conduct its business in the ordinary course;
(iii) commences any Insolvency Proceeding with respect to itself; or (iv) takes
any action to effectuate or authorize any of the foregoing.
(i) (i) Any
involuntary Insolvency Proceeding is commenced or filed against the Borrower,
or
any writ, judgment, warrant of attachment, execution or similar process is
issued or levied against a substantial part of the Borrower’s properties, and
any such proceeding or petition shall not be dismissed, or such writ, judgment,
warrant of attachment, execution or similar process shall not be released,
vacated or fully bonded within 60 days after commencement, filing or levy;
or
(ii) the Borrower admits the material allegations of a petition against it
in any Insolvency Proceeding, or an order for relief (or similar order under
non-U.S. law) is ordered in any Insolvency Proceeding; or (iii) the
Borrower acquiesces in the appointment of a receiver, trustee, custodian,
conservator, liquidator, mortgagee in possession (or agent therefor), or similar
Person for itself or a substantial portion of its property or
business.
(j) A
Change
of Control shall occur with respect to the Borrower.
(k) The
Borrower shall fail within 45 days to pay, bond or otherwise discharge any
judgment or order for the payment of money in excess of $10,000,000, which
is
not stayed on appeal or otherwise being appropriately contested in good
faith.
(l) (i) An
ERISA Event or ERISA Termination Event which has resulted or would reasonably
be
expected to result in liability of the Borrower under Title IV of ERISA to
the
Pension Plan, Multiemployer Plan or the PBGC in an aggregate amount in excess
of
10% of Consolidated Net Worth; (ii) the commencement or increase of
contributions to, or the adoption of or the amendment of, a Pension Plan by
the
Borrower or an ERISA Affiliate which has resulted or could reasonably be
expected to result in an increase in Unfunded Pension Liability among all
Pension Plans in an aggregate amount in excess of 10% of Consolidated Net Worth;
or (iii) the Borrower’s or an ERISA Affiliate’s failure to pay when due, after
the expiration of any applicable grace period, any installment payment with
respect to its withdrawal liability under Section 4201 of ERISA under a
Multiemployer Plan which has resulted or could reasonably be expected to result
in a Material Adverse Effect.
(m) Any
governmental authority or other administrative or legal authority having
regulatory jurisdiction over the Borrower takes any action which has a Material
Adverse Effect on the Borrower.
Section
7.2 Rights
and Remedies.
Upon
the
occurrence of an Event of Default or at any time thereafter until such Event
of
Default is cured to the written satisfaction of the Required Lenders, the Agent
may, with the consent of the Required Lenders, and shall, at the request of
the
Required Lenders, exercise any or all of the following rights and
remedies:
(a) If
the
Term Loan has not been advanced, the Agent may, by notice to the Borrower,
declare the Commitments to be terminated, whereupon the same shall forthwith
terminate.
(b) The
Agent
may, by notice to the Borrower, declare the entire unpaid principal amount
of
the Notes then outstanding, all interest accrued and unpaid thereon, and all
other Obligations to be forthwith due and payable, whereupon the Notes, all
such
accrued interest and all such other Obligations shall become and be forthwith
due and payable, without presentment, demand, protest or further notice of
any
kind, all of which are hereby expressly waived by the Borrower.
(c) The
Lenders may exercise any other rights and remedies available to them by law
or
agreement.
Notwithstanding
the foregoing, upon the occurrence of an Event of Default described in Section
7.1(h) or 7.1(i) hereof, the entire unpaid principal amount of the Notes then
outstanding, all interest accrued and unpaid thereon, and all other amounts
payable under this Agreement shall be immediately due and payable without
presentment, demand, protest or notice of any kind.
ARTICLE
VIII
The
Agent
Section
8.1 Authorization.
Each
Lender and the holder of each Note irrevocably appoints and authorizes the
Agent
to act on behalf of such Lender or holder to the extent provided herein or
in
any document or instrument delivered hereunder or in connection herewith, and
to
take such other action as may be reasonably incidental thereto. In furtherance
of the foregoing, and not in limitation thereof, each Lender irrevocably
(i) authorizes the Agent to execute and deliver and perform its obligations
under this Agreement and each of the Loan Documents to which the Agent is a
party, and to exercise all rights, powers and remedies that the Agent may have
hereunder or thereunder, (ii) appoints the Agent as nominal beneficiary or
nominal secured party, as the case may be, under the Loan Documents and all
related UCC-1 financing statements, and (iii) authorizes the Agent to act
as agent of and for such Lender for purposes of holding, perfecting and
disposing of any collateral under the Loan Documents. As to any matters not
expressly provided for by this Agreement or the Loan Documents, the Agent shall
not be required to exercise any discretion or take any action, but shall be
required to act or to refrain from acting (and shall be fully protected in
so
acting or refraining from acting) upon the instructions of the Required Lenders
or, if so required pursuant to Section 9.2, upon the instructions of all
Lenders; provided, however, that except for action expressly required of the
Agent hereunder, the Agent shall in all cases be fully justified in failing
or
refusing to act hereunder unless it shall be indemnified to its satisfaction
by
the Lenders against any and all liability and expense which may be incurred
by
it by reason of taking or continuing to take any such action, and the Agent
shall not in any event be required to take any action which is contrary to
this
Agreement, the Loan Documents or applicable law. The Agent shall not have a
fiduciary relationship in respect of the Borrower or any Lender by reason of
this Agreement.
Section
8.2 Distribution
of Payments and Proceeds.
(a) After
deduction of any costs of collection, as provided in this Agreement and the
other Loan Documents, and any fee payable to the Agent in its capacity as such
under this Agreement, any Fee Letter or any other agreement, the Agent shall
remit to each Lender that Lender’s Percentage of all payments of principal and
interest and of all fees and other amounts payable hereunder for the benefit
of
the Lenders that are received by the Agent under the Loan Documents. Each
Lender’s interest in the Loan Documents shall be payable solely from payments,
collections and proceeds actually received by the Agent under the Loan
Documents; and the Agent’s only liability to the Lenders hereunder shall be to
account for each Lender’s Percentage of such payments, collections and proceeds
in accordance with this Agreement. If the Agent is ever required for any reason
to refund any such payments, collections or proceeds, each Lender will refund
to
the Agent, upon demand, its Percentage of such payments, collections or
proceeds, together with its Percentage of interest or penalties, if any, payable
by the Agent in connection with such refund.
(b) Notwithstanding
the foregoing, if any Lender has wrongfully refused to fund its Percentage
of
the Term Loan as required hereunder, or if the principal balance of any Lender’s
Note is for any other reason less than its Percentage of the aggregate principal
balances of the Notes then outstanding, the Agent may remit all payments
received by it to the other Lenders until such payments have reduced the
aggregate amounts owed by the Borrower to the extent that the aggregate amount
owing to such Lender hereunder is equal to its Percentage of the aggregate
amount owing to all of the Lenders hereunder. The provisions of this paragraph
are intended only to set forth certain rules for the application of payments,
proceeds and collections in the event that a Lender has breached its obligations
hereunder and shall not be deemed to excuse any Lender from such
obligations.
Section
8.3 Expenses.
All
payments, collections and proceeds received or effected by the Agent may be
applied, first, to pay or reimburse the Agent for all costs, expenses, damages
and liabilities at any time incurred by or imposed upon the Agent in connection
with this Agreement or any other Loan Document (including but not limited to
all
reasonable attorney’s fees, foreclosure expenses and advances made to protect
the security of any collateral). If the Agent does not receive payments,
collections or proceeds sufficient to cover any such costs, expenses, damages
or
liabilities within 30 days after their incurrence or imposition, each Lender
shall, upon demand, remit to the Agent its Percentage of the difference between
(i) such costs, expenses, damages and liabilities, and (ii) such payments,
collections and proceeds, together with interest on such amount for each day
following the thirtieth day after demand therefor until so remitted at a rate
equal to the Federal Funds Rate for each such day.
Section
8.4 Payments
Received Directly by Lenders.
If
any
Lender or other holder of a Note shall obtain any payment or other recovery
(whether voluntary, involuntary, by application of offset or otherwise) on
account of the Obligations other than through distributions made in accordance
with Section 8.2, such Lender or holder shall promptly give notice of such
fact
to the Agent and shall purchase from the other Lenders or holders such
participations in the Obligations held by them as shall be necessary to cause
the purchasing Lender or holder to share the excess payment or other recovery
ratably with each of them; provided, however, that if all or any portion of
the
excess payment or other recovery is thereafter recovered from such purchasing
Lender or holder, the purchase shall be rescinded and the purchasing Lender
restored to the extent of such recovery (but without interest
thereon).
Section
8.5 Indemnification.
Each
Lender severally (but not jointly) hereby agrees to indemnify and hold harmless
the Agent, as well as the Agent’s agents, employees, officers and directors,
ratably according to their respective Percentages from and against any and
all
losses, liabilities (including liabilities for penalties), actions, suits,
judgment, demands, damages, costs, disbursements, or expenses (including
attorneys’ fees and expenses) of any kind or nature whatsoever, which are
imposed on, incurred by, or asserted against the Agent or its agents, employees,
officers or directors in any way relating to or arising out of this Agreement
or
the Loan Documents, or as a result of any action taken or omitted to be taken
by
the Agent; provided,
however,
that no
Lender shall be liable for any portion of any such losses, liabilities
(including liabilities for penalties), actions, suits, judgments, demands,
damages, costs disbursements, or expenses resulting from the gross negligence
or
willful misconduct of the Agent. Notwithstanding any other provision of the
Loan
Documents, the Agent shall in all cases be fully justified in failing or
refusing to act hereunder unless it shall be indemnified to its satisfaction
by
the Lenders against any and all liability and expense that may be incurred
by it
by reason of taking or continuing to take any such action.
Section
8.6 Exculpation.
The
Agent
shall not be liable for any action taken or omitted to be taken by the Agent
in
connection with this Agreement or the Loan Documents, except for its own gross
negligence or willful misconduct. The Agent shall be entitled to rely upon
advice of counsel concerning legal matters, the advice of independent public
accountants with respect to accounting matters and advice of other experts
as to
any other matters, and upon this Agreement, any Loan Document and any schedule,
certificate, statement, report, notice or other writing which it believes to
be
genuine or to have been presented by a proper person. Neither the Agent nor
any
of its directors, officers, employees or agents shall (a) be responsible for
any
recitals, representations or warranties contained in, or for the execution,
validity, genuineness, effectiveness or enforceability of this Agreement, any
Loan Document, or any other instrument or document delivered hereunder or in
connection herewith, (b) be responsible for the validity, genuineness,
perfection, effectiveness, enforceability, existence, value or enforcement
of
any collateral security, (c) be under any duty to inquire into or pass upon
any
of the foregoing matters, or to make any inquiry concerning the performance
by
the Borrower or any other obligor of its obligations, or (d) in any event,
be
liable as such for any action taken or omitted by it or them, except for its
or
their own gross negligence or willful misconduct. The agency hereby created
shall in no way impair or affect any of the rights and powers of, or impose
any
duties or obligations upon, the Agent in its individual capacity.
Section
8.7 Agent
and Affiliates.
The
Agent
shall have the same rights and powers hereunder in its individual capacity
as
any other Lender, and may exercise or refrain from exercising the same as though
it were not the Agent, and the Agent and its affiliates may accept deposits
from
and generally engage in any kind of business with the Borrower as fully as
if
the Agent were not the Agent hereunder.
Section
8.8 Credit
Investigation.
Each
Lender acknowledges that it has made such inquiries and taken such care on
its
own behalf as would have been the case had its obligations hereunder been
incurred and its Percentage of the Term Loan made directly by such Lender to
the
Borrower without the intervention of the Agent or any other Lender. Each Lender
agrees and acknowledges that the Agent makes no representations or warranties
about the creditworthiness of the Borrower or any other party to this Agreement
or with respect to the legality, validity, sufficiency or enforceability of
this
Agreement, any Loan Document, or any other instrument or document delivered
hereunder or in connection herewith.
Section
8.9 Resignation
and Assignment of Agent.
(a) The
Agent
may resign as such at any time upon at least 30 days’ prior notice to the
Borrower and the Lenders. In the event of any resignation of the Agent, the
Required Lenders shall as promptly as practicable appoint a successor Agent.
If
no such successor Agent shall have been so appointed by the Required Lenders
and
shall have accepted such appointment within 30 days after the resigning Agent’s
giving of notice of resignation, then the resigning Agent may, on behalf of
the
Lenders, appoint a successor Agent, which shall be a commercial bank organized
under the laws of the United States of America or of any State thereof. Any
such
successor Agent shall have capital and retained earnings of at least
$100,000,000.
(b) The
Agent
may, without the consent of the Borrower or the other Lenders, assign its rights
and obligations as Agent hereunder and under the other Loan Documents to its
parent or to any wholly owned subsidiary of its parent, and upon such
assignment, the former Agent shall be deemed to have retired, and such wholly
owned subsidiary shall be deemed to be a successor Agent. Any such successor
Agent shall have capital and retained earnings of at least
$100,000,000.
(c) Upon
the
acceptance of any appointment as Agent hereunder by a successor Agent, such
successor Agent shall thereupon be entitled to receive from the prior Agent
such
documents of transfer and assignment as such successor Agent may reasonably
request and the resigning or assigning Agent shall be discharged from its duties
and obligations under this Agreement. After any resignation or assignment
pursuant to this Section, the provisions of this Section shall inure to the
benefit of the retiring Agent as to any actions taken or omitted to be taken
by
it while it was acting as Agent hereunder.
Section
8.10 Defaults.
The
Agent
shall not be deemed to have knowledge of the occurrence of a Default or an
Event
of Default unless the Agent has received notice from a Lender or the Borrower
specifying the occurrence of such Default or Event of Default. In the event
that
the Agent receives such a notice of the occurrence of a Default or an Event
of
Default, the Agent shall give prompt notice thereof to the Lenders. The Agent
shall (subject to Section 8.5 hereof) take such actions with respect to such
Default as shall be directed by the Required Lenders; provided that, unless
and
until the Agent shall have received such directions, the Agent may take any
action, or refrain from taking any action, with respect to such Default as
it
shall deem advisable in the best interest of the Lenders.
Section
8.11 Obligations
Several.
The
obligations of each Lender hereunder are the several obligations of such Lender,
and neither any Lender nor the Agent shall be responsible for the obligations
of
any other Lender hereunder, nor will the failure by the Agent or any Lender
to
perform any of its obligations hereunder relieve the Agent or any other Lender
from the performance of its respective obligations hereunder. Nothing contained
in this Agreement, and no action taken by any Lender or the Agent pursuant
hereto or in connection herewith or pursuant to or in connection with the Loan
Documents shall be deemed to constitute the Lenders, together or with or without
the Agent, as a partnership, association, joint venture, or other
entity.
ARTICLE
IX
Miscellaneous
Section
9.1 No
Waiver; Cumulative Remedies.
No
failure or delay on the part of the Lenders in exercising any right, power
or
remedy under the Loan Documents shall operate as a waiver thereof; nor shall
any
Lender’s acceptance of payments while any Default or Event of Default is
outstanding operate as a waiver of such Default or Event of Default, or any
right, power or remedy under the Loan Documents; nor shall any single or partial
exercise of any such right, power or remedy preclude any other or further
exercise thereof or the exercise of any other right, power or remedy under
the
Loan Documents. The remedies provided in the Loan Documents are cumulative
and
not exclusive of any remedies provided by law.
Section
9.2 Amendments,
Etc.
No
amendment or waiver of any provision of any Loan Document or consent to any
departure by the Borrower therefrom shall be effective unless the same shall
be
in writing and signed by the Required Lenders (or by the Agent with the consent
or at the request of the Required Lenders), and any such waiver shall be
effective only in the specific instance and for the specific purpose for which
given. No notice to or demand on the Borrower in any case shall entitle the
Borrower to any other or further notice or demand in similar or other
circumstances.
Notwithstanding
the foregoing:
(a) No
such
amendment or waiver shall be effective to do any of the following unless signed
by each of the Lenders (or by the Agent with the consent or at the request
of
each of the Lenders):
|
(i)
|
Increase
the Commitment Amount of any Lender or extend the Term Loan Funding
Deadline.
|
|
(ii)
|
Permit
the Borrower to assign its rights under this
Agreement.
|
|
(iii)
|
Amend
this Section, the definition of “Required Lenders” in Section 1.1, or any
provision herein providing for consent or other action by all
Lenders.
|
(b) No
such
amendment or waiver shall be effective to do any of the following unless signed
by each of the Lenders affected thereby (or by the Agent with the consent or
at
the request of each of such Lenders):
|
(i)
|
Forgive
any indebtedness of the Borrower arising under this Agreement or
the
Notes, or reduce the rate of interest or any fees charged under this
Agreement or the Notes.
|
|
(ii)
|
Postpone
or delay any date fixed by this Agreement or any other Loan Document
for
any payment of principal, interest, facility fees or other material
amounts due to the Lenders (or any of them) hereunder or under any
other
Loan Document.
|
(c) No
amendment, waiver or consent shall affect the rights or duties of the Agent
under this Agreement or any other Loan Document unless in writing and signed
by
the Agent.
(d) No
amendment, modification or (except as provided elsewhere herein) termination
of
this Agreement or waiver of any rights of the Borrower or obligations of any
Lender or the Agent hereunder shall be effective unless the Borrower shall
have
consented thereto in writing.
Section
9.3 Notice.
Except
as
otherwise expressly provided herein, all notices and other communications
hereunder shall be in writing and shall be (i) personally delivered, (ii)
transmitted by registered mail, postage prepaid, (iii) sent by Federal Express
or similar expedited delivery service, or (iv) transmitted by telecopy, in
each
case addressed to the party to whom notice is being given at its address or
telecopier number (as the case may be) as set forth in Exhibit A or in any
applicable Assignment Certificate; or, as to each party, at such other address
or telecopier number as may hereafter be designated in a notice by that party
to
the other party complying with the terms of this Section. All such notices
or
other communications shall be deemed to have been given on (i) the date
received if delivered personally or by mail, (ii) the date of receipt, if
delivered by Federal Express or similar expedited delivery service, or
(iii) the date of transmission if delivered by telecopy, except that
notices or requests to the Agent or any Lender pursuant to any of the provisions
of Article II shall not be effective until received.
Section
9.4 Costs
and Expenses.
The
Borrower agrees to pay on demand all reasonable costs and expenses incurred
by
the Agent in connection with the negotiation, preparation, execution,
administration, amendment or enforcement of the Loan Documents and the other
instruments and documents to be delivered hereunder and thereunder, including
the reasonable fees and out-of-pocket expenses of counsel for any Lender with
respect thereto, whether paid to outside counsel or allocated to the Agent
by
in-house counsel.
Section
9.5 Indemnification
by Borrower.
The
Borrower hereby agrees to indemnify the Agent and the Lenders and each officer,
director, employee and agent thereof (herein individually each called an
“Indemnitee” and collectively called the “Indemnitees”) from and against any and
all losses, claims, damages, reasonable expenses (including, without limitation,
reasonable attorneys’ fees) and liabilities incurred by an Indemnitee in
connection with or arising out of the execution or delivery of this Agreement
or
any agreement or instrument contemplated hereby, the performance by the parties
hereto of their respective obligations hereunder or the use of the proceeds
of
the Term Loan (including but not limited to any such loss, claim, damage,
expense or liability arising out of any claim in which it is alleged that any
Environmental Law has been breached with respect to any activity or property
of
the Borrower), except to the extent that such loss, claim, damage, expense
or
liability was incurred as a result of the gross negligence or willful misconduct
of the applicable Indemnitee. All obligations provided for in this
Section shall survive any termination of this Agreement.
Section
9.6 Execution
in Counterparts.
This
Agreement and the other Loan Documents may be executed in any number of
counterparts, each of which when so executed and delivered shall be deemed
to be
an original and all of which counterparts of this Agreement or such other Loan
Document, as the case may be, taken together, shall constitute but one and
the
same instrument.
Section
9.7 Binding
Effect; Assignment and Participations.
(a) Generally.
The Loan
Documents shall be binding upon and inure to the benefit of the Borrower and
the
Lenders and their respective successors and assigns, except that (i) the
Borrower shall not have the right to assign its rights thereunder or any
interest therein without the prior written consent of each of the Lenders,
and
(ii) except as set forth in this Section 9.7, no Lender may assign or grant
any participation in any of its rights or obligations under any Loan
Document.
(b) Participations.
Any
Lender may, at any time, grant participations in a portion of its Note and
Commitment to any institutional investor on any date selected by such Lender.
Any Lender proposing a participation hereunder shall give notice of such
participation to the Agent at least ten Business Days prior to such
participation (unless the Agent consents to a shorter period of time). Such
notice shall specify the identity of the proposed purchaser of the participation
and the amount of the proposed participation. No such partial participation
shall be permitted if the principal amount thereof would be less than
$5,000,000. No holder of any such participation, other than an affiliate of
such
Lender, shall be entitled to require such Lender to take or omit to take any
action hereunder, except that such Lender may agree with such participant that
such Lender will not, without such participant’s consent, (i) forgive any
indebtedness of the Borrower under this Agreement or the Notes, (ii) agree
to reduce the rate of interest charged under this Agreement, or (iii) agree
to extend the final maturity of any indebtedness evidenced by the Notes, except
as expressly provided by the terms of the Loan Documents. No Lender shall,
as
between the Borrower and such Lender, be relieved of any of its obligations
hereunder as a result of any such granting of a participation. The Borrower
hereby acknowledges and agrees that any participant described in this Section
will, for purposes of Section 2.9, be considered to be a Lender hereunder
(provided that such participant shall not be entitled to receive any more than
the Lender selling such participation would have received had such sale not
taken place) and may rely on, and possess all rights under, any opinions,
certificates, or other instruments or documents delivered under or in connection
with any Loan Document (it being understood that each opinion delivered
hereunder speaks only as of the date thereof).
(c) Assignments.
Any
Lender may, at any time, assign a portion of its Note and Commitment to an
Eligible Lender (an “Applicant”) on any date (the “Adjustment Date”) selected by
such Lender. Any Lender proposing an assignment hereunder shall give notice
of
such assignment to the Agent at least ten Business Days prior to such assignment
(unless the Agent consents to a shorter period of time). Such notice shall
specify the identity of such Applicant and the Percentage which it proposes
that
such Applicant acquire (which Percentage shall be the same for the Commitment
and the Note held by the assigning Lender). No such partial assignment shall
be
permitted if, immediately after giving effect to such assignment, either the
Credit Exposure of the Applicant or the Credit Exposure of the assigning Lender
would be less than $5,000,000. The notice of assignment shall contain a
representation by the Applicant to the effect that none of the consideration
used to make the purchase of the Note and Commitment under the applicable
assignment agreement constitutes “plan assets” as defined under ERISA and that
the rights and interests of the Applicant in and under the Loan Documents will
not be “plan assets” under ERISA. Any Lender making an assignment under this
Section shall pay the Agent a transfer fee in the amount of $3,500
simultaneously with such assignment.
(d) Consents.
Any
assignment hereunder may be made, and any participation granted, only with
the
prior written consent of the Agent and the Borrower; provided, however, that
(i) in no event shall such consent be unreasonably withheld, (ii) the
consent of the Borrower shall not be required if any Default or Event of Default
has occurred and is continuing at the time of such assignment or grant of
participation, (iii) no such consent of the Borrower and the Agent shall be
required for the assignment by any Lender of, or grant of a participation in,
all or any part of its Commitment and Note to one or more other Persons that
are
Lenders immediately prior to such assignment, and (iv) no such consent of
the Borrower and the Agent shall be required for the assignment by any Lender
of, or grant of a participation in, all or any part of its Commitment and Note
to one or more affiliates of such Lender, provided that, unless consented to
by
the Borrower and the Agent (which consent shall not be unreasonably withheld),
no such assignment under this clause (iv) shall relieve the transferring Lender
from its obligations hereunder.
(e) Assignment
Certificate and Notes.
To
confirm the status of each Additional Lender as a party to this Agreement and
to
evidence the assignment in accordance herewith:
|
(i)
|
the
Borrower, such Lender, such Applicant, and the Agent shall, on or
before
the Adjustment Date, execute and deliver to the Agent an Assignment
Certificate in substantially the form of Exhibit D (an “Assignment
Certificate”) (provided that the assignment will be effective without the
signature of the Borrower or the Agent to the extent that the consent
of
the Borrower or the Agent, as the case may be, is not required hereunder);
and
|
|
(ii)
|
the
Borrower will, at its own expense, execute and deliver to the Additional
Lender a new Note, payable to the order of the Additional Lender
in an
amount corresponding to the applicable interest in the assigning
Lender’s
rights and obligations acquired by such Applicant pursuant to such
assignment, and, if the assigning Lender has retained interests in
such
rights and obligations, a new Note, payable to the order of that
Lender in
an amount corresponding to such retained interests. Such new Notes
shall
be in an aggregate principal amount equal to the aggregate principal
amount of the applicable Note to be replaced by such new Notes, shall
be
dated the effective date of such assignment and shall otherwise be
in the
form of the Note to be replaced thereby. Such new Notes shall be
issued in
substitution for, but not in satisfaction or payment of, the Notes
being
replaced thereby.
|
|
Upon
the execution and delivery of such Assignment Certificate and such
Notes,
(a) this Agreement shall be deemed to be amended to the extent, and
only to the extent, necessary to reflect the addition of such Additional
Lender and the resulting adjustment of Percentages arising therefrom,
(b)
the assigning Lender shall be relieved of all obligations hereunder
to the
extent of the reduction of all obligations hereunder and to the extent
of
the reduction of such Lender’s Percentage, and (c) the Additional Lender
shall become a party hereto and shall be entitled to all rights,
benefits
and privileges accorded to a Lender herein and in each other document
or
instrument executed pursuant hereto and subject to all obligations
of a
Lender hereunder, including the right to approve or disapprove actions
which, in accordance with the terms hereof, require the approval
of the
Required Lenders or all Lenders, and, if the Term Loan has not yet
been
made, the obligation to advance its Percentage of the Term Loan hereunder.
|
(f) Federal
Reserve Bank Security Interests.
Notwithstanding the foregoing, each Lender may at any time grant a security
interest in all or any portion of its rights under this Agreement and that
Lender’s Note in favor of any Federal Reserve Bank in accordance with Regulation
A of the Board of Governors of the Federal Reserve System.
(g) Borrower
Cooperation. In
order
to facilitate the addition of Additional Lenders hereto, the Borrower shall
cooperate fully with each Lender and the Agent in connection therewith and
shall
provide all reasonable assistance requested by each Lender and the Agent
relating thereto, including, without limitation, the furnishing of such written
materials and financial information regarding the Borrower as any Lender or
the
Agent may reasonably request, the execution of such documents as any Lender
or
the Agent may reasonably request with respect thereto, and the participation
by
officers of the Borrower in a meeting or teleconference call with any Applicant
upon the reasonable request of any Lender or the Agent.
Section
9.8 Disclosure
of Information.
The
Agent
and the Lenders shall keep confidential (and cause their respective officers,
directors, employees, agents and representatives to keep confidential) all
information, materials and documents furnished by the Borrower, the Agent or
the
Lenders (the “Disclosed Information”). Notwithstanding the foregoing, the Agent
and each Lender may disclose Disclosed Information (i) to the Agent, any
other Lender or any Affiliate of any Lender; (ii) to legal counsel,
accountants and other professional advisors to the Agent or such Lender;
(iii) to any regulatory body having jurisdiction over any Lender or the
Agent; (iv) to the extent required by applicable laws and regulations or by
any subpoena or similar legal process, or requested by any governmental agency
or authority; (v) to the extent such Disclosed Information (A) becomes
publicly available other than as a result of a breach of this Agreement, (B)
becomes available to the Agent or such Lender on a non-confidential basis from
a
source other than the Borrower or a Subsidiary, or (C) was available to the
Agent or such Lender on a non-confidential basis prior to its disclosure to
the
Agent or such Lender by the Borrower or a Subsidiary; (vi) to the extent
the Borrower or such Subsidiary shall have consented to such disclosure in
writing; (vii) to the extent reasonably deemed necessary by the Agent or
any Lender in the enforcement of the remedies of the Agent and the Lenders
provided under the Loan Documents; or (viii) in connection with any
potential assignment or participation in the interest granted hereunder,
provided that any such potential assignee or participant shall have executed
a
confidentiality agreement imposing on such potential assignee or participant
substantially the same obligations as are imposed on the Agent and the Lenders
under this Section 9.8.
Section
9.9 Governing
Law.
The
Loan
Documents shall be governed by, and construed in accordance with, the laws
of
the State of New York.
Section
9.10 Consent
to Jurisdiction.
Each
of
the Borrower, the Agent and the Lenders irrevocably (i) agrees that any
suit, action or other legal proceeding arising out of or relating to this
Agreement or any other Loan Document shall be brought in a court of record
in
Hennepin County in the State of Minnesota or in the courts of the United States
located in such State, (ii) consents to the jurisdiction of each such court
in any suit, action or proceeding, (iii) waives any objection which it may
have to the laying of venue of any such suit, action or proceeding in any such
courts and any claim that any such suit, action or proceeding has been brought
in an inconvenient forum, and (iv) agrees that a final judgment in any such
suit, 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
after all appeals have been exhausted.
Section
9.11 Waiver
of Jury Trial.
THE
BORROWER, THE AGENT AND THE LENDERS HEREBY WAIVE TRIAL BY JURY IN ANY JUDICIAL
PROCEEDING INVOLVING, DIRECTLY OR INDIRECTLY, ANY MATTER (WHETHER SOUNDING
IN
TORT, CONTRACT OR OTHERWISE) IN ANY WAY ARISING OUT OF, RELATED TO, OR CONNECTED
WITH THIS AGREEMENT AND THE NOTES OR THE RELATIONSHIPS ESTABLISHED
HEREUNDER.
Section
9.12 Severability
of Provisions.
Any
provision of this Agreement which is prohibited or unenforceable shall be
ineffective to the extent of such prohibition or unenforceability without
invalidating the remaining provisions hereof.
Section
9.13 Prior
Agreements.
This
Agreement and the other Loan Documents and related documents described herein
restate and supersede in their entirety any and all prior agreements and
understandings, oral or written, between the Lenders and the
Borrower.
Section
9.14 Other
Financing.
If
at any
time from and after the effective date of this Agreement, the Borrower shall
enter into any trust indenture, credit agreement or other agreement for,
relating to, or amending any terms or conditions applicable to any unsecured
indebtedness in an amount not less than $15,000,000, the Borrower shall promptly
so advise the Agent. Thereupon, if the Required Lenders shall determine that
such trust indenture, credit agreement or other agreement includes covenants
or
defaults reasonably determined by the Required Lenders to be more restrictive
than those provided for in Articles V and VI and shall request by notice to
the
Borrower, the Borrower shall enter into an amendment to this Agreement providing
for substantially the same such covenants and defaults as those provided for
in
such trust indenture, credit agreement or other agreement, to the extent
required and as may be selected by the Required Lenders, such amendment to
remain in effect for the entire duration of the term to maturity of such
indebtedness (to and including the date to which the same may be extended);
provided, however, that if any such trust indenture, credit agreement or other
agreement shall be modified, supplemented, amended or terminated so as to
modify, amend or eliminate such trust indenture or other agreement or any such
covenant, term, condition or default so made a part of this Agreement, then,
the
Borrower shall give the Agent and the Lenders prompt notice thereof and such
modification, supplement or amendment shall operate to modify, amend or
eliminate such covenants, term, condition or default as so made a part of this
Agreement. Notwithstanding the foregoing, in no event shall this Section 9.14
be
construed so as to require the Borrower at any time to grant any Lien in favor
of the Agent or the Lenders hereunder.
Section
9.15 Headings.
Article
and Section headings in this Agreement are included herein for convenience
of
reference only and shall not constitute a part of this Agreement for any other
purpose.
Section
9.16 Customer
Identification - USA Patriot Act Notice.
The
Agent
hereby notifies the Borrower that pursuant to the requirements of the USA
Patriot Act (Title III of Pub. L. 107-56, signed into law October 26, 2001)
(the
“Act”), and the Agent’s policies and practices, each Lender is required to
obtain, verify and record certain information and documentation that identifies
the Borrower, which information includes the name and address of the Borrower
and such other information that will allow each Lender to identify the Borrower
in accordance with the Act.
IN
WITNESS WHEREOF, the parties hereto have caused this Agreement to be executed
by
their respective officers thereunto duly authorized as of the date first above
written.
|
MDU
RESOURCES GROUP, INC.
By
/s/
▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇▇
▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇▇
Vice President and Chief Accounting
Officer
|
|
|
▇▇▇▇▇
FARGO BANK, NATIONAL ASSOCIATION, as Agent and as a
Lender
By
/s/
▇▇▇▇▇▇▇ ▇▇▇▇▇
Its
Vice
President
|