EXHIBIT 10.1
------------
EXECUTION VERSION
CREDIT AGREEMENT
Dated as of May 2, 2006
Among
ALLEGHENY ENERGY SUPPLY COMPANY, LLC,
as Borrower,
and
THE INITIAL LENDERS, THE SWING LINE BANK AND INITIAL ISSUING BANK NAMED HEREIN,
as Initial Lenders, Swing Line Bank and Initial Issuing Bank,
and
CITICORP USA, INC.,
as Administrative Agent
________________________________________________________________________________
CITIGROUP GLOBAL THE BANK OF NOVA BANC OF AMERICA
MARKETS INC., SCOTIA, SECURITIES LLC,
as Joint Lead Arranger as Joint Lead Arranger, as Joint Lead Arranger
and Joint Book Runner as Joint Book Runner and and Joint Book Runner
Co-Syndication Agent BANK OF AMERICA, N.A.,
as Co-Syndication Agent
________________________________________________________________________________
AESC Credit Agreement
TABLE OF CONTENTS
Section Page
I
DEFINITIONS AND ACCOUNTING TERMS
SECTION 1.01. Definitions.........................................................................................2
SECTION 1.02. Principles of Interpretation.......................................................................39
SECTION 1.03. Letter of Credit...................................................................................40
SECTION 1.04. Determination of Material Adverse Change and Material Adverse Effect, Etc..........................40
ARTICLE II
AMOUNTS AND TERMS OF THE ADVANCES
AND LETTERS OF CREDIT
SECTION 2.01. The Advances.......................................................................................41
(a) Optional.......................................................................................41
(b) Term Advance...................................................................................41
(c) Swing Line Advance.............................................................................41
(d) Letters of Credit..............................................................................42
(e) Letters of Credit Generally....................................................................42
SECTION 2.02. Making the Advances................................................................................43
SECTION 2.03. Issuance of Letters of Credit; Drawings and Reimbursements; Auto-Extension Letters of
Credit; Funding of Participations..................................................................46
(a) Optional.......................................................................................46
(b) Drawings and Reimbursements; Funding of Participations.........................................47
(c) Repayment of Participations....................................................................49
(d) Role of Issuing Bank...........................................................................49
(e) Cash Collateral................................................................................50
(f) Applicability of ISP and UCP...................................................................50
(g) Conflict with Issuer Documents.................................................................50
(h) Letters of Credit Issued for Subsidiaries......................................................51
(i) Letter of Credit Reports.......................................................................51
(j) Obligations Absolute...........................................................................51
(k) Liability......................................................................................52
SECTION 2.04. Repayment of Advances..............................................................................52
SECTION 2.05. Termination or Reduction of the Commitments........................................................53
(a) Optional.......................................................................................53
(b) Mandatory......................................................................................53
SECTION 2.06. Prepayments........................................................................................53
(a) Optional.......................................................................................53
(b) Mandatory......................................................................................53
(c) Other Amounts..................................................................................55
SECTION 2.07. Interest...........................................................................................55
(a) Optional.......................................................................................55
(b) Default Interest...............................................................................56
(c) Notice of Interest Period and Interest Rate....................................................56
SECTION 2.08. Fees 56
(a) Optional.......................................................................................56
(b) Letter of Credit Fees..........................................................................56
(c) Fronting Fee and Documentary and Processing Charges Payable to Issuing Banks, Etc..............57
(d) Agents' Fees...................................................................................57
SECTION 2.09. Payments Generally; Pro Rata Treatment.............................................................57
SECTION 2.10. Illegality.........................................................................................59
SECTION 2.11. Interest Elections.................................................................................60
(a) Optional.......................................................................................60
(b) Mandatory......................................................................................61
SECTION 2.12. Increased Costs, Etc...............................................................................61
SECTION 2.13. Taxes 62
SECTION 2.14. Evidence of Debt...................................................................................65
SECTION 2.15. Use of Proceeds....................................................................................66
SECTION 2.16. Request for Commitments............................................................................66
ARTICLE III
CONDITIONS OF EFFECTIVENESS
SECTION 3.01. Conditions Precedent to Closing Date...............................................................68
SECTION 3.02. Conditions Precedent to Each Borrowing and L/C Credit Extension....................................72
SECTION 3.03. Determinations Under Sections 3.01 and 3.02........................................................73
ARTICLE IV
REPRESENTATIONS AND WARRANTIES
SECTION 4.01. Representations and Warranties.....................................................................73
ARTICLE V
COVENANTS
SECTION 5.01. Affirmative Covenants..............................................................................78
(a) Compliance with Laws...........................................................................78
(b) Compliance with Environmental Laws.............................................................78
(c) Payment of Taxes, Etc..........................................................................79
(d) Insurance......................................................................................79
(e) Preservation of Corporate Existence, Etc.......................................................79
(f) Visitation Rights..............................................................................79
(g) Keeping of Books...............................................................................80
(h) Maintenance of Properties, Etc.................................................................80
(i) Transactions with Affiliates...................................................................80
(j) Further Assurances.............................................................................80
(k) Preparation of Environmental Reports...........................................................81
(l) Real Property..................................................................................81
(m) Additional Material Subsidiaries...............................................................82
SECTION 5.02. Negative Covenants.................................................................................83
(a) Liens, Etc.....................................................................................83
(b) Debt...........................................................................................85
(c) Mergers, Etc...................................................................................89
(d) Sales, Etc., of Assets.........................................................................89
(e) Investments in Other Persons...................................................................93
(f) Restricted Payments............................................................................95
(g) Payment Restrictions Affecting the Borrower's Subsidiaries.....................................96
SECTION 5.03. Financial Covenants................................................................................97
(a) Interest Coverage Ratio........................................................................97
(b) Leverage Ratio.................................................................................98
SECTION 5.04. Reporting Covenants................................................................................99
(a) Default Notices...............................................................................100
(b) Annual Financials.............................................................................100
(c) Quarterly Financials..........................................................................100
(d) Real Property.................................................................................101
(e) Additional Material Subsidiaries..............................................................101
(f) Other Information.............................................................................101
ARTICLE VI
EVENTS OF DEFAULT
SECTION 6.01. Events of Default.................................................................................101
SECTION 6.02. Actions in Respect of Letters of Credit upon Default..............................................104
ARTICLE VII
THE ADMINISTRATIVE AGENT
SECTION 7.01. Authorization and Action..........................................................................105
SECTION 7.02. Reliance, Etc.....................................................................................105
SECTION 7.03. CUSA, CGMI, Citibank, Scotia Capital, BAS, BofA and Affiliates....................................106
SECTION 7.04. Lender Party Credit Decision......................................................................106
SECTION 7.05. Indemnification...................................................................................106
SECTION 7.06. Successor Administrative Agent....................................................................108
SECTION 7.07. Liability.........................................................................................108
SECTION 7.08. Compensation of Agents............................................................................108
SECTION 7.09. Exculpatory Provisions............................................................................109
SECTION 7.10. Treatment of Lenders..............................................................................109
SECTION 7.11. Miscellaneous.....................................................................................109
(a) Instructions..................................................................................109
(b) No Obligation.................................................................................109
SECTION 7.12. Arranger Parties..................................................................................110
ARTICLE VIII
MISCELLANEOUS
SECTION 8.01. Amendments, Etc...................................................................................110
(a) Amendments....................................................................................110
(b) Clarifications................................................................................111
(c) Other Financing Documents.....................................................................111
SECTION 8.02. Notices, Etc......................................................................................111
SECTION 8.03. No Waiver, Remedies...............................................................................113
SECTION 8.04. Indemnity and Expenses............................................................................113
SECTION 8.05. Right of Set-off..................................................................................115
SECTION 8.06. Binding Effect....................................................................................115
SECTION 8.07. Assignments and Participations....................................................................115
SECTION 8.08. Execution in Counterparts.........................................................................120
SECTION 8.09. Jurisdiction, Etc.................................................................................120
SECTION 8.10. Governing Law.....................................................................................121
SECTION 8.11. Waiver of Jury Trial..............................................................................121
SECTION 8.12. Confidentiality...................................................................................121
SECTION 8.13. Benefits of Agreement.............................................................................123
SECTION 8.14. Severability......................................................................................123
SECTION 8.15. Limitations.......................................................................................123
SECTION 8.16. Survival..........................................................................................123
SECTION 8.17. USA Patriot Act Notice............................................................................124
SCHEDULES
Schedule I .- Commitments, Pro Rata Shares and Applicable Lending Offices
Schedule 1.01(a) - Amended and Restated Mortgages
Schedule 3.01(a) - Jurisdictions
Schedule 4.01(b) - Subsidiaries
Schedule 4.01(d) - Governmental Approvals and Filings
Schedule 4.01(f) - Disclosed Litigation
Schedule 4.01(g) - Disclosed Information
Schedule 4.01(l) - Certain Environmental Matters
Schedule 4.01(n) - Owned Real Property
Schedule 4.01(r) - Material Debt for Borrowed Money
Schedule 5.01(i) - Affiliate Transactions
Schedule 5.02(a) - Liens
EXHIBITS
Exhibit A-1 - Form of Revolving Note
Exhibit A-2 - Form of Term Note
Exhibit B-1 - Form of Notice of Borrowing
Exhibit B-2 - Form of Notice of Swing Line Borrowing
Exhibit C - Form of Assignment and Acceptance
Exhibit D - Form of Security Agreement
Exhibit E - Intercreditor Terms
Exhibit F - Affiliate Subordination Terms
Exhibit G - Real Property Requirements
Exhibit H - Form of PNC Control Agreement
CREDIT AGREEMENT
CREDIT AGREEMENT dated as of May 2, 2006 (as amended, modified or
otherwise supplemented from time to time in accordance with its terms, this
"Agreement"), among ALLEGHENY ENERGY SUPPLY COMPANY, LLC, a Delaware limited
liability company (the "Borrower"), the banks, financial institutions and other
institutional lenders listed on the signature pages hereof as the Initial
Lenders (the "Initial Lenders"), THE BANK OF NOVA SCOTIA ("Scotia Capital"), as
the initial issuing bank for the letters of credit issued or to be issued
pursuant to this Agreement (in such capacity, the "Initial Issuing Bank" and,
together with the Initial Lenders, the "Initial Lender Parties"), CITICORP USA,
INC. ("CUSA"), as the swing line bank (in such capacity, the "Swing Line Bank"),
CITIGROUP GLOBAL MARKETS INC. ("CGMI"), as Joint Lead Arranger and Joint Book
Runner, Scotia Capital, as Joint Lead Arranger, Joint Book Runner and
Co-Syndication Agent, BANC OF AMERICA SECURITIES LLC ("BAS"), as Joint Lead
Arranger and Joint Book Runner, BANK OF AMERICA, N.A. ("BofA"), as
Co-Syndication Agent, and CUSA, not in its individual capacity except as
expressly set forth herein but solely as administrative agent (together with any
successor administrative agent appointed pursuant to Article VII, the
"Administrative Agent") for the Lender Parties (as hereinafter defined).
PRELIMINARY STATEMENTS
(1) The Borrower is indebted to certain banks and financial
institutions (the "Existing Lenders") pursuant to that certain Credit Agreement,
dated as of July 21, 2005 (as amended through the date hereof, the "Existing
Credit Agreement"), among the Borrower, the other persons referred to therein as
loan parties, the financial institutions party thereto as lenders, Citicorp
North America, Inc., as administrative agent, and Citibank, N.A., as collateral
agent and intercreditor agent.
(2) The Borrower has requested that the Initial Lender Parties
establish a senior secured term credit facility in the aggregate principal
amount of $767,000,000 in favor of the Borrower. The Initial Lender Parties have
indicated their willingness to provide such financing to the Borrower on the
terms and conditions of this Agreement and the other Financing Documents (as
hereinafter defined).
(3) The Borrower has also requested that the Initial Lender
Parties establish a senior secured revolving credit facility in the aggregate
amount of $200,000,000 in favor of the Borrower, with up to (a) the full amount
thereof to be made available in the form of Revolving Advances (as hereinafter
defined) or one or more Letters of Credit (as hereinafter defined) issued at the
request of the Borrower on behalf of itself or any of its Subsidiaries (as
hereinafter defined) and (b) $10,000,000 thereof to be available in the form of
Swing Line Advances (as hereinafter defined). The Initial Lender Parties have
indicated their willingness to provide such financing to the Borrower on the
terms and conditions of this Agreement and the other Financing Documents.
(4) The proceeds of the Term Facility (as hereinafter defined),
together with proceeds of the Revolving Facility made available on the Closing
Date (as hereinafter defined), shall be used to refinance amounts outstanding
under the Existing Credit Agreement.
(5) The proceeds of the Revolving Facility (as hereinafter
defined) shall be used (a) on the Closing Date, to refinance amounts outstanding
under the Existing Credit Agreement and (b) after the Closing Date, to provide
working capital for the Borrower and its Subsidiaries.
NOW, THEREFORE, in consideration of the premises and of the mutual
covenants and agreements contained herein, the parties hereto hereby agree as
follows:
ARTICLE I
DEFINITIONS AND ACCOUNTING TERMS
SECTION 1.01. Definitions. As used in this Agreement, unless
otherwise indicated the following terms shall have the following meanings:
"1940 Act" means the Investment Company Act of 1940, as amended.
"Account Control Agreement" has the meaning set forth in the Security
Agreement.
"Acquired Material Property" has the meaning specified in Section
5.04(d).
"Act" has the meaning specified in Section 8.17.
"Administrative Agent" has the meaning specified in the recital of
parties to this Agreement.
"Administrative Agent's Account" means the account of the
Administrative Agent maintained by the Administrative Agent with Citibank, at
its office at ▇ ▇▇▇▇▇ ▇▇▇, ▇▇▇ ▇▇▇▇▇▇, ▇▇▇▇▇▇▇▇ (ABA No. ▇▇▇▇▇▇▇▇▇), Account No.
▇▇▇▇▇▇▇▇, Reference: Allegheny Energy Supply Company, LLC, or such other account
as the Administrative Agent shall specify in writing to the Lender Parties and
the Borrower.
"Advance" means a Revolving Advance, a Swing Line Advance or a Term
Advance, as the context may require.
"AE Capital" means Allegheny Energy Supply Capital, LLC, a Delaware
limited liability company.
"Affiliate" means, as to any Person, any other Person that, directly or
indirectly, controls, is controlled by or is under common control with such
Person or is a director or officer of such Person. For purposes of this
definition, the term "control" (including the terms "controlling", "controlled
by" and "under common control with") of a Person means the possession, direct or
indirect, of the power to vote 10% or more of the Voting Interests of such
Person or to direct or cause the direction of the management and policies of
such Person, whether through the ownership of Voting Interests, by contract or
otherwise.
"Affiliate Subordination Terms" means, with respect to any Debt or
other Obligations owed by the Borrower or any Material Subsidiary to any
Affiliate thereof, that such Debt is subject to an agreement which subordinates
such Debt to the Obligations owed in respect of the Advances on identical terms
to those set forth in Exhibit F hereto.
"AGC" means Allegheny Generating Company, a Virginia corporation.
"AGC Transmission Line" means, collectively, (a) the 500 kilovolt
interconnection and transmission facilities for the power generation station
owned by AGC, including transmission lines, substations, transformers, breakers,
relays, switches, switchyards, synchronizing equipment, metering equipment and
other equipment relating thereto (and, in each case, is not required for the
generation of electric energy by the power generation station owned by AGC), (b)
the land owned by AGC, if any, on which any such facilities are situated (to the
extent the power generation station owned by AGC is not also situated on such
land) and (c) all easements, licenses and rights-of-way of AGC in respect of
such interconnection and transmission facilities.
"Agent Parties" has the meaning set forth in Section 8.02(d). "Agents"
means the Administrative Agent and the Collateral Agent.
"Agreement" has the meaning set forth in the recital of the parties to
this agreement.
"Agreement Value" means, for each Hedge Agreement, on any date of
determination, an amount determined by the Borrower in good faith equal to: (a)
in the case of a Hedge Agreement documented pursuant to the Master Agreement (as
defined in the definition of a "Hedge Agreement"), the amount, if any, that
would be payable by the Borrower or any of its Subsidiaries to its counterparty
to such Hedge Agreement pursuant to the terms of such Hedge Agreement, as if (i)
such Hedge Agreement was being terminated early on such date of determination,
(ii) the Borrower or such Subsidiary was the sole "Affected Party", and (iii)
the Borrower or such Subsidiary was the sole party determining such payment
amount (with the Borrower making such determination pursuant to the provisions
of the Master Agreement or the Hedge Agreement (whichever is applicable)); or
(b) in the case of a Hedge Agreement traded on an exchange, the ▇▇▇▇-to-market
value of such Hedge Agreement, which will be the unrealized loss on such Hedge
Agreement (after any netting permitted pursuant to the terms of such Hedge
Agreement (including any netting across different Hedge Agreements and Master
Agreements to the extent permitted by contract)) to the Borrower or any of its
Subsidiaries party to such Hedge Agreement, if any, determined by the Borrower
in good faith based on the settlement price of such Hedge Agreement on such date
of determination; or (c) in all other cases, the ▇▇▇▇-to-market value of such
Hedge Agreement, which will be the unrealized loss on such Hedge Agreement
(after any netting permitted pursuant to the terms of such Hedge Agreement
(including any netting across different Hedge Agreements and Master Agreements
to the extent permitted by contract)) to the Borrower or any of its Subsidiaries
party to such Hedge Agreement, if any, as determined by the Borrower in good
faith in accordance with the terms of such Hedge Agreement or, if such Hedge
Agreement does not provide a methodology for such determination, the amount, if
any, by which (i) the present value of the future cash flows to be paid by the
Borrower or any of its Subsidiaries party thereto, as the case may be, exceeds
(ii) the present value of the future cash flows to be received by the Borrower
or such Subsidiary, as the case may be, pursuant to such Hedge Agreement;
capitalized terms used and not otherwise defined in this definition shall have
the respective meanings set forth in the above described Master Agreement.
"ALTA Survey" means a fully paid American Land Title
Association/American Congress on Surveying and Mapping form survey.
"Amended and Restated Mortgages" means the deeds of trust, trust deeds
and mortgages set forth on Schedule 1.01(a).
"Amendment Fee" means any fee offered, paid or payable to any Lender
Party by the Borrower or any Affiliate of the Borrower (whether directly or
through any Agent or any other Person) in consideration for any waiver of, or
agreement to amend or modify any provision of, any of the Financing Documents.
"Amendments" has the meaning specified in Section 3.01(a)(iv).
"Applicable Law" means, with respect to any Person, any and all laws,
statutes, regulations or rules, or orders, injunctions, decrees, judgments,
writs, determinations or awards having the force or effect of binding such
Person at law issued by any Governmental Authority, applicable to such Person,
including all Environmental Laws.
"Applicable Lending Office" means, with respect to each Lender Party,
such Lender Party's Domestic Lending Office in the case of a Base Rate Advance
and such Lender Party's Eurodollar Lending Office in the case of a Eurodollar
Rate Advance.
"Applicable Margin" means, as of any date, a percentage per annum
determined by reference to the Public Debt Rating in effect on such date as set
forth below:
===================== ================= ===================
Applicable Applicable Margin
Public Debt Rating Margin for for
S&P/▇▇▇▇▇'▇ Base Rate Eurodollar Rate
Advances Advances
===================== ================= ===================
Level 1 0.00% 0.45%
BBB+/Baa1
or above
--------------------- ----------------- -------------------
▇▇▇▇▇ ▇ 0.00% 0.55%
BBB/Baa2
--------------------- ----------------- -------------------
▇▇▇▇▇ ▇ 0.00% 0.75%
BBB-/Baa3
--------------------- ----------------- -------------------
▇▇▇▇▇ ▇ 0.00% 0.875%
BB+/Ba1
--------------------- ----------------- -------------------
▇▇▇▇▇ ▇ 0.25% 1.25%
BB/Ba2
--------------------- ----------------- -------------------
▇▇▇▇▇ ▇ 0.50% 1.50%
Below
BB/Ba2
===================== ================= ===================
"Appropriate Lender" means, at any time, with respect to (a) the
Revolving Facility, a Revolving Lender, (b) the Swing Line Facility, (i) the
Swing Line Bank and (ii) if the other Revolving Lenders have made Swing Line
Advances pursuant to Section 2.02(c) that are outstanding at such time, each
such other Revolving Lender and (c) the Term Facility, a Term Lender.
"Approved Fund" means a Fund that is administered or managed by (a) a
Lender, (b) an Affiliate of a Lender or (c) a Person or an Affiliate of a Person
that administers or manages a Lender.
"▇▇▇▇▇▇▇▇▇ Facility" means the ▇▇▇▇▇▇▇▇▇ generating facility located
near ▇▇▇▇▇▇, Pennsylvania in ▇▇▇▇▇▇▇▇▇ County, Pennsylvania and owned by the
Borrower.
"Arranger Parties" means CGMI, as Joint Lead Arranger and Joint Book
Runner, Scotia Capital, as Joint Lead Arranger, as Joint Book Runner and
Co-Syndication Agent, BAS, as Joint Lead Arranger and Joint Book Runner, and
BofA, as Co-Syndication Agent.
"Asset Sale" means any Sale of any Asset (including Emissions Credits)
by the Borrower or any Material Subsidiary to any Person other than the Borrower
or a Material Subsidiary, other than (a) Sales of Emissions Credits in the
ordinary course of business to the extent that the Net Cash Proceeds received by
the Borrower and its Subsidiaries therefrom are less than or equal to
$100,000,000 in the aggregate in any Fiscal Year and such Sale does not
contravene the terms of Section 5.02(d)(i)(B) and (b) Sales pursuant to clause
(A), (C), (D), (G), (H), (I), (J), (K) or (L) of Section 5.02(d)(i).
"Assets" means, with respect to any Person, all or any part of its
business, property, rights, interests and assets, both tangible and intangible
(including Equity Interests in any other Person), wherever situated.
"Assignment and Acceptance" means an assignment and acceptance entered
into by a Lender Party and an Eligible Assignee, and accepted by the
Administrative Agent, in accordance with Section 8.07 and in substantially the
form of Exhibit C.
"Authorized Signatory" means, with respect to any Person, the
individual, or any of the individuals, authorized to sign any Financing
Document, as well as any other agreements, to which such Person is or is to be a
party and give written instructions on behalf of such Person with regard to any
matters pertaining to any Financing Document to which such Person is or is to be
a party (as identified on an incumbency certificate submitted to the
Administrative Agent (and, prior to the Collateral Release Date, the Collateral
Agent) from time to time prior to the receipt of any instructions from such
Authorized Signatory).
"Auto-Extension Letter of Credit" has the meaning specified in Section
2.03(a)(iii).
"AYE Money Pool" means the internal financing facility of the Parent
and certain of its Subsidiaries in which the excess funds of certain
participants are used to satisfy the short-term borrowing needs of other
participants.
"BAS" has the meaning specified in the recital of parties to this
Agreement.
"Base Rate" means a fluctuating interest rate per annum in effect from
time to time, which rate per annum shall at all times be equal to the higher of:
(a) the rate of interest announced publicly by Citibank in New York,
New York, from time to time, as Citibank's base rate; and
(b) the Federal Funds Rate plus 0.5% per annum.
"Base Rate Advance" means an Advance that bears interest as provided in
Section 2.07(a)(i).
"Bath County" means the undivided forty percent (40%) interest
(constituting 1035 MW of pumped storage) owned by a Subsidiary of the Parent in
the hydroelectric power generating station located in Bath County, Virginia.
"▇▇▇▇▇▇▇▇ Creek Property" means the 34-acre property located in
▇▇▇▇▇▇▇▇ County, West Virginia and owned by the Borrower and MPC, but excluding
any related personal property the creation, granting or perfection of a Lien
upon or in which is governed by the UCC.
"BofA" has the meaning specified in the recital of parties to this
Agreement.
"Borrower" has the meaning specified in the recital of parties to this
Agreement.
"Borrowing" means a Revolving Borrowing, a Swing Line Borrowing or a
Term Borrowing.
"Borrowing Account" means such account as the Borrower shall specify in
writing to the Administrative Agent from time to time.
"Buffalo Reserve Project" means the development of property and mineral
and other natural resources rights in Washington County and adjoining counties
in the Commonwealth of Pennsylvania and the State of West Virginia, including
(a) the formation of a legal entity to pursue the development of such property
and mineral rights, and (b) entering into operating agreements, joint venture
agreements, partnership agreements, working interests, royalty interests,
mineral leases, processing agreements, contracts for sale, transportation or
exchange agreements, unitization agreements, pooling agreements, area of mutual
interest agreements, production sharing agreements or other similar or customary
agreements, transactions, interests or arrangements, and Investments and
expenditures in connection with the development of such property and mineral
rights.
"Business Day" means a day of the year on which banks are not required
or not authorized by law to close in New York City and, if the applicable
Business Day relates to any Eurodollar Rate Advances, on which dealings are
carried on in the London interbank market.
"Capital Expenditures" means, for any Person for any period, the sum
of, without duplication, all expenditures made, directly or indirectly, by such
Person during such period (whether financed by cash or by Debt (including
Obligations under Capitalized Leases) assumed or incurred to fund, directly or
indirectly, such expenditures) for equipment, fixed assets, real property or
improvements, or for replacements or substitutions therefor or additions
thereto, that have been or should be, in accordance with GAAP, reflected as
additions to property, plant or equipment on a balance sheet of such Person. For
purposes of this definition, the purchase price of equipment that is purchased
simultaneously with the trade-in of existing equipment or with insurance
proceeds shall be included in Capital Expenditures only to the extent of the
excess (if any) of the gross amount of such purchase price over the credit
granted by the seller of such equipment for the equipment being traded in at
such time or the amount of such proceeds, as the case may be.
"Capitalized Leases" means all leases that have been or should be, in
accordance with GAAP, recorded as capitalized leases.
"Cash Collateral Account" means a non-interest bearing securities
account opened, or to be opened, by the Administrative Agent and in which a Lien
has been granted to the Administrative Agent for the benefit of each Revolving
Lender and each Issuing Bank pursuant to documentation in form and substance
reasonably satisfactory to the Administrative Agent and each Issuing Bank (which
documents are hereby consented to by the Revolving Lenders) to the extent that
any Letter of Credit is required to be Cash Collateralized in accordance with
this Agreement.
"Cash Collateralize" means to pledge and deposit with or deliver to the
Administrative Agent, for the benefit of each Issuing Bank and each Revolving
Lender, as collateral for the L/C Obligations, cash or deposit account balances,
and "Cash Collateral" shall refer to such cash or deposit account balances.
"Cash Equivalents" means any of the following, to the extent owned by
the Borrower or any of its Subsidiaries free and clear of all Liens (other than,
Liens permitted under the Financing Documents) and, except in the case of clause
(d) below, having a maturity of not greater than one year from the date of
issuance thereof: (a) readily marketable direct obligations of the Government of
the United States or any agency or instrumentality thereof or obligations
unconditionally guaranteed by the full faith and credit of the Government of the
United States, (b) certificates of deposit, time deposits, eurodollar deposits
and bankers' acceptances with any commercial bank that is an Agent or a Lender
Party or a member of the Federal Reserve System, is organized under the laws of
the United States or any State thereof and has combined capital and surplus of
at least $500,000,000; provided that the aggregate principal amount of
certificates of deposit, time deposits, eurodollar time deposits and bankers
acceptances of any one bank shall not exceed $50,000,000 at any one time, (c)
commercial paper in an aggregate amount of no more than $50,000,000 per issuer
outstanding at any time, issued by any corporation organized under the laws of
any State of the United States and rated at least "Prime-1" (or the then
equivalent grade) by ▇▇▇▇▇'▇ or "A-1" (or the then equivalent grade) by S&P, or
(d) investments in mutual funds the sole investments of which are the cash
equivalents identified in clauses (a) through (c) above (but with a remaining
maturity of not greater than 13 months while being held by the applicable mutual
fund) and repurchase obligations for any of the cash equivalents identified in
clause (a) above.
"CERCLA" means the Comprehensive Environmental Response, Compensation,
and Liability Act of 1980, as amended from time to time.
"CERCLIS" means the Comprehensive Environmental Response, Compensation,
and Liability Information System maintained by the U.S. Environmental Protection
Agency.
"CGMI" has the meaning specified in the recital of parties to this
Agreement.
"Change of Control" means the occurrence of any of the following: (a)
the Parent shall cease to own all issued and outstanding Equity Interests in the
Borrower other than the ML Interests; (b) any Person or two or more Persons
acting in concert shall have acquired beneficial ownership (within the meaning
of Rule 13d-3 of the Securities and Exchange Commission under the Securities
Exchange Act of 1934, as amended), directly or indirectly, of Voting Interests
of the Parent (or other securities convertible into such Voting Interests)
representing 40% or more of the combined voting power of all Voting Interests of
the Parent; (c) during any period of up to 24 consecutive months, commencing
before or after the date of this Agreement, individuals who at the beginning of
such 24-month period were directors of the Parent (the "Original Directors")
shall cease for any reason to constitute a majority of the board of directors of
the Parent (unless replaced by individuals nominated or proposed by the Original
Directors); or (d) any Person or two or more Persons acting in concert shall
have acquired by contract or otherwise, or shall have entered into a contract or
arrangement that, upon consummation, will result in its or their acquisition of
the power to exercise, directly or indirectly, a controlling influence over the
management or policies of the Parent.
"Chief Financial Officer" of any Person means such Person's chief
financial officer or such other natural person who is principally responsible
for such Person's financial matters.
"Citibank" means Citibank, N.A.
"Closing Date" has the meaning specified in Section 3.01(a).
"Closing Date Transactions" has the meaning specified in Section
3.01(a)(xiii).
"CNAI" means Citicorp North America, Inc.
"Code" means the Internal Revenue Code of 1986, as amended from time to
time, and the regulations promulgated and rulings issued thereunder.
"Collateral" has the meaning specified in the Security Agreement.
"Collateral Agent" means Citibank, N.A. (or any successor collateral
agent appointed pursuant to Article VII of the Security Agreement), solely in
its capacity as collateral agent for the Secured Parties.
"Collateral Documents" means the Security Agreement, the Mortgages, the
Account Control Agreements and any other agreement that creates or purports to
create a Lien in favor of the Collateral Agent for the benefit of the Secured
Parties.
"Collateral Release Date" means the date when (a) the non-credit
enhanced long-term senior unsecured debt of the Borrower shall be rated not
worse than BBB- and Baa3 by S&P and ▇▇▇▇▇'▇, respectively, in each case with
stable outlook, and (b) the Administrative Agent shall have received a
certificate from the Borrower certifying as to such ratings and requesting the
termination of all Collateral Documents and the release of all Liens created
thereunder in respect of the Collateral.
"Commitment" means, as to each Lender, such Lender's Revolving
Commitment or Term Commitment, as the context may require.
"Commitment Effective Date" has the meaning specified in Section
2.16(b).
"Commitment Fee Rate" means, as of any date, a percentage per annum
determined by reference to the Public Debt Rating in effect on such date as set
forth below:
=========================== ==========================
Public Debt Rating Commitment Fee Rate
S&P/▇▇▇▇▇'▇
=========================== ==========================
Level 1 0.080%
BBB+/Baa1
or above
--------------------------- --------------------------
▇▇▇▇▇ ▇ 0.100%
BBB/Baa2
--------------------------- --------------------------
▇▇▇▇▇ ▇ 0.125%
BBB-/Baa3
--------------------------- --------------------------
▇▇▇▇▇ ▇ 0.200%
BB+/Ba1
--------------------------- --------------------------
▇▇▇▇▇ ▇ 0.250%
BB/Ba2
--------------------------- --------------------------
▇▇▇▇▇ ▇ 0.300%
Below
BB/Ba2
=========================== ==========================
"Commodity Hedge Agreement" means any swap, cap, collar, floor, future,
option, spot, forward, power purchase agreement, power sale agreement, electric
power generation capacity purchase and sale agreement, fuel purchase agreement,
fuel sale agreement, power transmission agreement, regional transmission
organization agreements, fuel transportation agreement, fuel storage agreement,
netting agreement or similar agreement (including each confirmation entered into
pursuant to any master agreement) entered into in the ordinary course of
business in order to manage fluctuations in the price or availability to the
Borrower or any of its Subsidiaries of any energy-related commodity including
Emissions Credits and energy attributes. For purposes of this definition
"commodity" means any tangible or intangible commodity of any type or
description, including electric power, electric power capacity, petroleum, coal,
urea, financial transmission rights, natural gas and by-products thereof.
"Communications" has the meaning specified in Section 8.02(b).
"Confidential Information" has the meaning specified in Section
8.12(a).
"Consolidated" refers to the consolidation of accounts in accordance
with GAAP.
"Consolidated EBITDA" means, for any period, Consolidated Net Income
for such period plus (a) without duplication and to the extent deducted in
determining such Consolidated Net Income, the sum of (i) Consolidated Interest
Expense for such period, (ii) consolidated income tax expense for such period,
(iii) all amounts attributable to minority interests and to depreciation and
amortization for such period (including amortization of Debt issuance costs),
(iv) any extraordinary or non-recurring non-cash charges (including the
write-down of non-current assets) for such period, (v) any non-cash goodwill or
other intangible asset impairment charges resulting from the application of
Statement Number 142 or Statement Number 144 of the Financial Accounting
Standards Board, (vi) any non-recurring expenses or non-cash charges incurred in
connection with the Transactions and (vii) any non-cash compensation charges,
including any such charges arising from stock options, restricted stock grants
and other equity incentive programs; provided that to the extent that all or any
portion of the net income of any Subsidiary of the Borrower or any other Person
is excluded from Consolidated Net Income pursuant to the definition thereof for
all or any portion of such period any amounts set forth in the preceding clauses
(i) through (vii) that are attributable to such Subsidiary or other Person shall
not be included for purposes of this clause (a) for such period or portion
thereof, and minus (b) without duplication, (i) all cash payments made during
such period on account of reserves, restructuring charges and other non-cash
charges added to Consolidated Net Income pursuant to clause (a) above after the
Closing Date and (ii) to the extent included in determining such Consolidated
Net Income, any extraordinary gains and all non-recurring non-cash items of
income for such period, all determined on a consolidated basis in accordance
with GAAP; provided that for purposes of calculating Consolidated EBITDA for any
period for purposes of the covenants set forth in Section 5.03, (A) the
Consolidated EBITDA of any Investment made or Subsidiary acquired by the
Borrower or any Subsidiary in accordance with the terms of this Agreement during
such period for which aggregate consideration paid by the Borrower or any of its
Subsidiaries shall be equal to or greater than $25,000,000 shall be included on
a pro forma basis for such period (assuming the consummation of such acquisition
and the incurrence or assumption of any Debt in connection therewith occurred as
of the first day of such period), and (B) the Consolidated EBITDA of any Person
or line of business sold or otherwise disposed of by the Borrower or any of its
Subsidiaries during such period for which the aggregate consideration received
by the Borrower or any of its Subsidiaries shall be equal to or greater than
$25,000,000 shall be excluded for such period (assuming the consummation of such
sale or other disposition and the repayment of any Debt in connection therewith
occurred as of the first day of such period).
"Consolidated Interest Expense" means, for any period, (a) the sum of,
without duplication, (i) the interest expenses (including imputed interest
expense in respect of Capitalized Leases) of the Borrower and its Subsidiaries
for such period (including all commissions, discounts and other fees and charges
owed by the Borrower and its Subsidiaries with respect to letters of credit and
bankers' acceptance financing), net of interest income, in each case determined
on a consolidated basis in accordance with GAAP, plus (ii) any interest accrued
during such period in respect of Debt of the Borrower or any of its Subsidiaries
that is required to be capitalized rather than included in consolidated interest
expenses for such period in accordance with GAAP, minus (b) to the extent
included in such consolidated interest expense for such period, amounts
attributable to the amortization of financing costs and non-cash amounts
attributable to the amortization of debt discounts. For purposes of the
foregoing, interest expense shall be determined after giving effect to any net
payments made or received by the Borrower or any of its Subsidiaries with
respect to interest rate Hedge Agreements which are included as interest expense
in accordance with GAAP.
"Consolidated Net Income" means, for any period, the net income or loss
before cumulative effect in change of accounting principles of the Borrower and
its Subsidiaries for such period determined on a consolidated basis in
accordance with GAAP; provided that there shall be excluded (a) the income of
any Subsidiary of the Borrower to the extent that the declaration or payment of
dividends or similar distributions by such Subsidiary of that income is not, as
a result of any Subsidiary Debt Default, at the time permitted by operation of
the terms of the agreement or other documents governing the Debt under which
such Subsidiary Debt Default shall have occurred; provided that such income of
such Subsidiary shall only be so excluded for that portion of such period during
which the condition described in this clause (a) shall so exist; (b) the income
or loss of any Person accrued prior to the date it becomes a Subsidiary or is
merged or Consolidated with the Borrower or any Subsidiary on the date such
Person's Assets are acquired by the Borrower or any Subsidiary; (c) the income
or loss of any Person (other than a Subsidiary) in which any other Person (other
than the Borrower or a wholly owned Subsidiary of the Borrower) has an interest,
except to the extent of the amount of dividends or other distributions actually
paid to the Borrower or a wholly owned Subsidiary by such Person during such
period; (d) any gain or loss in excess of $1,000,000 attributable to any
individual sale of an Asset, or series of related sales of Assets, out of the
ordinary course of business; and (e) any gains or losses attributable to
interest rate Hedge Agreements which are not included as interest expense in
accordance with GAAP.
"Consolidated Net Tangible Assets" means, as of any date of
determination, an amount equal to (a) Consolidated total Assets of the Borrower
and its Subsidiaries, minus (b) all Assets of the Borrower and its Subsidiaries
on that date that are considered to be intangible assets under GAAP, including
goodwill.
"Constituent Documents" means, with respect to any Person, (a) the
articles or certificate of incorporation, charter or other similar
organizational document of such Person, (b) the by-laws or other similar
document of such Person, (c) any certificate of designation or instrument
relating to the rights of holders (including preferred shareholders) of Equity
Interests in such Person and (d) any shareholder rights agreement or other
similar agreement.
"Contest" means, with respect to the payment of Taxes or any other
claims or liabilities by any Person, to contest the validity or amount thereof
in good faith by appropriate proceedings timely instituted and diligently
pursued within the applicable statutory period and in accordance with Applicable
Law; provided that the following conditions are satisfied: (a) such Person has
posted a bond or other security in accordance with Applicable Law (if required)
or has established adequate reserves with respect to the contested items in
accordance with, and to the extent required by, GAAP; (b) during the period of
such contest, the enforcement of any contested item is effectively stayed; (c)
neither such Person nor any of its officers, directors or employees nor any
Secured Party or any of its respective officers, directors or employees is, or
could reasonably be expected to become, subject to any criminal liability or
sanction in connection with such contested items; and (d) no Lien relating to
such contest attaches to any Assets of such Person and becomes enforceable
against other creditors of such Person.
"Contingent Obligation" means, with respect to any Person, any
Obligation or arrangement of such Person to guarantee or intended to guarantee
any Debt, leases, dividends or other payment Obligations ("primary obligations")
of any other Person (the "primary obligor") in any manner, whether directly or
indirectly, including (a) the direct or indirect guarantee, endorsement (other
than for collection or deposit in the ordinary course of business), co-making,
discounting with recourse or sale with recourse by such Person of the Obligation
of a primary obligor, (b) the Obligation to make take-or-pay or similar
payments, if required, regardless of nonperformance by any other party or
parties to an agreement or (c) any Obligation of such Person, whether or not
contingent, (i) to purchase any such primary obligation or any property
constituting direct or indirect security therefor, (ii) to advance or supply
funds (A) for the purchase or payment of any such primary obligation or (B) to
maintain working capital or equity capital of the primary obligor or otherwise
to maintain the net worth or solvency of the primary obligor, (iii) to purchase
Assets, securities or services primarily for the purpose of assuring the owner
of any such primary obligation of the ability of the primary obligor to make
payment of such primary obligation or (iv) otherwise to assure or hold harmless
the holder of such primary obligation against loss in respect thereof. The
amount of any Contingent Obligation shall be deemed to be an amount equal to the
stated or determinable amount of the primary obligation in respect of which such
Contingent Obligation is made (or, if less, the maximum amount of such primary
obligation for which such Person may be liable pursuant to the terms of the
instrument evidencing such Contingent Obligation) or, if not stated or
determinable, the maximum reasonably anticipated liability in respect thereof
(assuming such Person is required to perform thereunder), as determined by such
Person in good faith.
"Continuation", "Continue" and "Continued" each refer to a continuation
of Eurodollar Rate Advances upon the expiration of the Interest Period therefor
as Eurodollar Rate Advances of the same or a different Interest Period pursuant
to Section 2.11.
"Controlled Account" has the meaning specified in the Security
Agreement.
"Conversion", "Convert" and "Converted" each refer to a conversion of
Advances of one Type into Advances of the other Type pursuant to Section 2.11 or
2.12.
"Covered Taxes" has the meaning specified in Section 2.13(a).
"CUSA" has the meaning specified in the recital of parties to this
Agreement.
"Debt" of any Person (the "obligor") means, without duplication, (a)
all Obligations of such obligor for or in respect of moneys borrowed or raised
(whether or not for cash) by whatever means (including acceptances, deposits,
discounting, letters of credit, factoring (other than on a non-recourse basis),
and any other form of financing that is recognized in accordance with GAAP in
the obligor's financial statements as being in the nature of a borrowing or is
treated as "off-balance" sheet financing; (b) all Obligations of the obligor
evidenced by notes, bonds, debentures or other similar instruments issued in
connection with accounts payable excluded pursuant to the parenthetical in
clause (c) below; (c) all Obligations of the obligor for the deferred purchase
price of property or services (other than accounts (i) payable within 90 days of
being incurred arising in the ordinary course of such obligor's business and not
more than 90 days past due, or (ii) subject to a Contest); (d) all Obligations
of such obligor under conditional sale or other title retention agreements
relating to Assets acquired by such obligor (even though the rights and remedies
of the seller or lender under such agreement in the event of default are limited
to repossession or sale of such property); (e) all Obligations of such obligor
under any securitization or monetization arrangement; (f) all Obligations of
such obligor as lessee under Capitalized Leases; (g) all Obligations of the
obligor, contingent or otherwise, of the obligor under acceptance, letter of
credit or similar facilities other than as issued (i) in connection with
Obligations excluded pursuant to clause (b) above or the parenthetical in clause
(c) above or (ii) as credit support for leases other than Capitalized Leases;
(h) all Obligations of the obligor to purchase, redeem, retire, defease or
otherwise make any payments in respect of any Equity Interests in the obligor or
any other Person or any warrants, rights or options to acquire such capital
stock, valued, in the case of Redeemable Preferred Interests, at the greater of
its voluntary or involuntary liquidation preference plus accrued and unpaid
dividends; (i) all Obligations of the obligor in respect of Hedge Agreements;
(j) all Contingent Obligations of the obligor with respect to Debt; and (k) all
indebtedness and other payment Obligations referred to in clauses (a) through
(j) above of another Person secured by (or for which the holder of such Debt has
an existing right, contingent or otherwise, to be secured by) any Lien on
property (including accounts and contract rights owned by the obligor), even
though the obligor has not assumed or become liable for the payment of such
indebtedness or other payment Obligations.
"Debt for Borrowed Money" means Debt of the types specified in (i)
clauses (a), (b), (d), (e) and (f) of the definition of "Debt" and (ii) to the
extent relating to Debt of the types specified in one or more of clauses (a),
(b), (d), (e) and (f) of the definition of "Debt", clauses (j) and (k) thereof.
"Default" means any Event of Default or any event that would constitute
an Event of Default but for the requirement that notice be given or time elapse
or both.
"Disclosed Litigation" has the meaning specified in Section 4.01(f).
"Disclosed Matters" means the occurrence of any event in respect of, or
effect upon, the business, condition (financial or otherwise), operations,
performance, properties, assets, liabilities (actual or contingent), results of
operations or prospects of the Borrower or the Borrower and its Subsidiaries,
taken as a whole, which has been disclosed (a) pursuant to a public filing by
the Parent with the SEC or (b) in writing to the Administrative Agent.
"Dollars" and "$" mean the lawful currency of the United States of
America.
"Domestic Lending Office" means, with respect to any Lender Party, the
office of such Lender Party specified as its "Domestic Lending Office" opposite
its name on Schedule I or in the Assignment and Acceptance pursuant to which it
became a Lender Party, as the case may be, or such other office of such Lender
Party as such Lender Party may from time to time specify to the Borrower and the
Administrative Agent.
"Eligible Assignee" means (a) with respect to any Lender, (i) any other
Lender; (ii) an Affiliate of a Lender; (iii) an Approved Fund; (iv) a commercial
bank organized under the laws of the United States, or any State thereof, and
having a combined capital and surplus of at least $500,000,000; (v) a savings
and loan association or savings bank organized under the laws of the United
States, or any State thereof, and having a combined capital and surplus of at
least $500,000,000; (vi) a commercial bank organized under the laws of any other
country that is a member of the OECD or has concluded special lending
arrangements with the International Monetary Fund associated with its General
Arrangements to Borrow or a political subdivision of any such country, and
having a combined capital and surplus of at least $500,000,000, so long as such
bank is acting through a branch or agency located in the country in which it is
organized or another country that is described in this clause (vi); (vii) the
central bank of any country that is a member of the OECD; (viii) a finance
company, insurance company or other financial institution or fund (whether a
corporation, partnership, trust or other entity) that is engaged in making,
purchasing or otherwise investing in commercial loans in the ordinary course of
its business and having a combined capital and surplus of at least $500,000,000;
or (ix) any other Person approved by (A) to the extent such Person is to become
an Eligible Assignee in respect of any assignment of any Revolving Commitment,
any Revolving Advance, any L/C Credit Extension or any L/C Borrowing, the
Issuing Bank(s) (each acting in its sole discretion) and the Administrative
Agent (such consent not to be unreasonably withheld or delayed) and, so long as
no Specified Default shall have occurred and be continuing, the Borrower (such
approval not to be unreasonably withheld or delayed), (B) to the extent such
Person is to become an Eligible Assignee in respect of any assignment of any
Revolving Commitment or any Revolving Advance, the Swing Line Bank and (C) to
the extent such Person is to become an Eligible Assignee in respect of any
assignment of any Term Commitment or any Term Advance, the Administrative Agent
(such consent not to be unreasonably withheld) and, so long as no Specified
Default shall have occurred and be continuing, the Borrower (such approval not
to be unreasonably withheld or delayed), and (b) with respect to any Issuing
Bank, a Person that is an Eligible Assignee under subclause (iv) or (vi) (so
long as such bank is acting through a branch or agency located in the United
States) of clause (a) of this definition and is approved by the Administrative
Agent and, so long as no Specified Default shall have occurred and be
continuing, the Borrower, such approval, not to be unreasonably withheld or
delayed; provided that neither the Borrower nor any Affiliate of the Borrower
shall qualify as an Eligible Assignee under this definition; and provided
further that, for the avoidance of doubt, notwithstanding whether any Person
constitutes an "Eligible Assignee", the consent of (x) the Issuing Bank(s) under
Section 8.07(a) shall be required with respect to any assignment of any
Revolving Commitment, any Revolving Advance, any L/C Credit Extension or any L/C
Borrowing and (y) the Swing Line Bank under Section 8.07(a) shall be required
with respect to any assignment of any Revolving Commitment or any Revolving
Advance.
"Emissions Credits" means the emissions limitations which: (a) are
issued by environmental Governmental Authorities; (b) authorize the emission of
a fixed amount of pollutants; and (c) are utilized as a market-based mechanism
for reducing pollution.
"Environmental Action" means any action, suit, demand letter, claim by
any Governmental Authority, notice of non-compliance or violation, notice of
liability or potential liability, investigation, proceeding, consent order or
consent agreement relating to any Environmental Law, Environmental Permit or
Hazardous Material or arising from alleged injury or threat to health and safety
or the environment relating to any Environmental Law, including (a) by any
governmental or regulatory authority for enforcement, cleanup, removal,
response, remedial or other actions or damages and (b) by any governmental or
regulatory authority or third party for damages, contribution, indemnification,
cost recovery, compensation or injunctive relief.
"Environmental Law" means any Federal, state, local or foreign statute,
law, ordinance, rule, regulation, code, order, writ, judgment, injunction,
decree or legally binding judicial or agency interpretation, policy or guidance
relating to pollution or protection of the environment, health and safety as it
relates to Hazardous Materials or natural resources, including those relating to
the use, handling, transportation, treatment, storage, disposal, release or
discharge of Hazardous Materials.
"Environmental Permit" means any permit, approval, identification
number, license or other authorization required under any Environmental Law.
"Equity Interests" means, with respect to any Person, shares of capital
stock of (or other ownership or profit interests in) such Person, warrants,
options or other rights for the purchase or other acquisition from such Person
of shares of capital stock of (or other ownership or profit interests in) such
Person, non-Debt securities convertible into or exchangeable for shares of
capital stock of (or other ownership or profit interests in) such Person,
warrants, rights or options for the purchase or other acquisition from such
Person of such shares (or such other interests), and other ownership or profit
interests in such Person (including partnership, member or trust interests
therein), whether voting or nonvoting, and whether or not such shares, warrants,
options, rights or other interests are authorized or otherwise existing on any
date of determination.
"ERISA" means the Employee Retirement Income Security Act of 1974, as
amended from time to time, and the regulations promulgated and rulings issued
thereunder.
"ERISA Affiliate" means any Person that for purposes of Title IV of
ERISA is a member of the controlled group of the Borrower or any of its
Subsidiaries, or under common control, within the meaning of Section 414 of the
Code, with the Borrower or any of its Subsidiaries.
"ERISA Event" means (a) (i) the occurrence of a reportable event,
within the meaning of Section 4043(c) of ERISA, with respect to any Plan unless
the 30-day notice requirement with respect to such event has been waived by the
PBGC or (ii) the requirements of Section 4043(b) of ERISA apply with respect to
a contributing sponsor, as defined in Section 4001(a)(13) of ERISA, of a Plan,
and an event described in paragraph (9), (10), (11), (12) or (13) of Section
4043(c) of ERISA is reasonably expected to occur with respect to such Plan
within the following 30 days; (b) the application for a minimum funding waiver
in accordance with Section 412(d) of the Code with respect to a Plan; (c) the
provision by the administrator of any Plan of a notice of intent to terminate
such Plan, pursuant to Section 4041(a)(2) of ERISA (including any such notice
with respect to a plan amendment referred to in Section 4041(e) of ERISA); (d)
the cessation of operations at a facility of the Borrower or any of its
Subsidiaries or any ERISA Affiliate in the circumstances described in Section
4062(e) of ERISA; (e) the withdrawal by the Borrower or any of its Subsidiaries
or any ERISA Affiliate from a Multiple Employer Plan during a plan year for
which it was a substantial employer, as defined in Section 4001(a)(2) of ERISA;
(f) a lien has been imposed under Section 302(f) of ERISA with respect to any
Plan; (g) the adoption of an amendment to a Plan requiring the provision of
security to such Plan pursuant to Section 307 of ERISA; or (h) the institution
by the PBGC of proceedings to terminate a Plan pursuant to Section 4042 of
ERISA, or the occurrence of any event or condition described in Section 4042 of
ERISA that constitutes grounds for the termination of, or the appointment of a
trustee to administer, such Plan, provided, however, that the occurrence of the
event or condition described in Section 4042(a)(4) of ERISA shall be an ERISA
Event only if the PBGC has notified the Borrower, any Subsidiary of the Borrower
or any ERISA Affiliate that it intends to institute proceedings to terminate a
Plan pursuant to such Section.
"Eurocurrency Liabilities" has the meaning specified in Regulation D of
the Board of Governors of the Federal Reserve System, as in effect from time to
time.
"Eurodollar Lending Office" means, with respect to any Lender Party,
the office of such Lender Party specified as its "Eurodollar Lending Office"
opposite its name on Schedule I or in the Assignment and Acceptance pursuant to
which it became a Lender Party (or, if no such office is specified, its Domestic
Lending Office), or such other office of such Lender Party as such Lender Party
may from time to time specify to the Borrower and the Administrative Agent.
"Eurodollar Rate" means, with respect to any Interest Period for all
Eurodollar Rate Advances comprising part of the same Borrowing, the rate per
annum obtained by dividing (a) LIBOR for such Interest Period by (b) a
percentage equal to 1.00 minus the Eurodollar Rate Reserve Percentage.
"Eurodollar Rate Advance" means an Advance that bears interest as
provided in Section 2.07(a)(ii).
"Eurodollar Rate Reserve Percentage" for any Interest Period for all
Eurodollar Rate Advances comprising part of the same Borrowing means the reserve
percentage applicable two Business Days before the first day of such Interest
Period under regulations issued from time to time by the Board of Governors of
the Federal Reserve System (or any successor) for determining the maximum
reserve requirement (including any emergency, supplemental or other marginal
reserve requirement) for a member bank of the Federal Reserve System in New York
City with respect to liabilities or assets consisting of or including
Eurocurrency Liabilities (or with respect to any other category of liabilities
that includes deposits by reference to which the interest rate on Eurodollar
Rate Advances is determined) having a term equal to such Interest Period.
"Event of Default" has the meaning specified in Section 6.01.
"Excluded Assets" means (a) with respect to the security interests
created by the Mortgages and the Security Agreement, the ▇▇▇▇▇ Facility and the
real and personal properties located in La Paz County, Arizona, Maricopa County,
Arizona, and St. ▇▇▇▇▇▇ County, Indiana, (b) with respect to the security
interests created by the Mortgages and the Security Agreement, the ▇▇▇▇▇▇▇▇
Creek Property (so long as the Fair Market Value of such property does not
exceed $10,000,000) and (c) the Equity Interests in each Subsidiary or other
entity owned by the Borrower other than a Material Subsidiary.
"Existing Credit Agreement" has the meaning specified in Preliminary
Statement (1) of this Agreement.
"Existing Debt" means all Debt of the Borrower and its Subsidiaries
outstanding under the Existing Credit Agreement.
"Existing Lenders" has the meaning specified in Preliminary Statement
(1) of this Agreement.
"Facility" means the Term Facility, the Revolving Facility or the Swing
Line Facility, as the context may require.
"Fair Market Value" means with respect to any Asset the price at which
a willing buyer would purchase such Asset from a willing seller, assuming that
both buyer and seller are rational and have reasonable knowledge of all relevant
facts.
"Federal Funds Rate" means, for any period, a fluctuating interest rate
per annum equal for each day during such period to the weighted average of the
rates on overnight Federal funds transactions with members of the Federal
Reserve System arranged by Federal funds brokers, as published for such day (or,
if such day is not a Business Day, for the next preceding Business Day) by the
Federal Reserve Bank of New York, or, if such rate is not so published for any
day that is a Business Day, the average of the quotations for such day for such
transactions received by the Administrative Agent from three Federal funds
brokers of recognized standing selected by it.
"Fee Letters" means, collectively, (a) each fee letter, if any, between
the Borrower and the Administrative Agent, (b) each fee letter, if any, between
the Borrower and the Collateral Agent and (c) the fee letter, if any, between
the Borrower and CGMI.
"FERC" means the Federal Energy Regulatory Commission.
"Final Maturity Date" means the earlier of (a) the date of termination
in whole of the Commitments, the Incremental Commitments and the L/C Obligations
pursuant to Section 2.05 or 6.01, and (b) the fifth anniversary of the Closing
Date.
"Financing Documents" means this Agreement, the Notes, the Fee Letters,
the Collateral Documents, the Issuer Documents, each intercreditor agreement (if
any) among the Collateral Agent, the Administrative Agent, the Borrower and the
counterparty of any Commodity Hedge Agreement in respect of Permitted Second
Priority Liens and each subordination agreement (if any) entered into in respect
of Debt referred to in Section 5.02(b)(v).
"Fiscal Year" means a fiscal year of the Borrower and its Consolidated
Subsidiaries ending on December 31 in any calendar year.
"Form 10-K" has the meaning set forth in Section 4.01(h).
"Fort ▇▇▇▇▇▇ Facility" means the Fort ▇▇▇▇▇▇ generating facility
located near Maidsville, West Virginia and owned by the Borrower and MPC.
"Fronting Fee" has the meaning specified in Section 2.08(c).
"Fund" means any Person (other than a natural person) that is (or will
be) engaged in making, purchasing, holding or otherwise investing in commercial
loans and similar extensions of credit in the ordinary course of its business.
"GAAP" has the meaning specified in Section 1.02(c).
"Governmental Approvals" has the meaning specified in Section 4.01(d).
"Governmental Authority" means any national, state, county, city, town,
village, municipal or other de jure or de facto government department,
commission, board, bureau, agency, authority or instrumentality of a country or
any political subdivision thereof or any regional transmission authority
organized pursuant to federal law, and any Person exercising executive,
legislative, judicial, regulatory or administrative functions of or pertaining
to any of the foregoing entities, including all commissions, boards, bureaus,
arbitrators and arbitration panels, and any authority or other Person controlled
by any of the foregoing. "Granting Lender" has the meaning specified in Section
8.07(h).
"▇▇▇▇▇▇▇▇'▇ Ferry Facility" means the ▇▇▇▇▇▇▇▇'▇ Ferry generation
facility located near Masontown, Pennsylvania and owned by the Borrower and MPC.
"Hazardous Materials" means (a) petroleum or petroleum products,
by-products or breakdown products, radioactive materials, asbestos-containing
materials, polychlorinated biphenyls and radon gas and (b) any other chemicals,
materials or substances designated, classified or regulated as hazardous or
toxic or as a pollutant or contaminant under any Environmental Law.
"Hedge Agreements" means (a) any and all rate swap transactions, basis
swaps, credit derivative transactions, forward rate transactions, commodity
swaps, commodity options, forward commodity contracts, any other Commodity Hedge
Agreements, equity or equity index swaps or options, bond or bond price or bond
index swaps or options or forward bond or forward bond price or forward bond
index transactions, interest rate options, forward foreign exchange
transactions, cap transactions, floor transactions, collar transactions,
currency swap transactions, cross-currency rate swap transactions, currency
options, spot contracts, or any other similar transactions or any combination of
the foregoing (including any option to enter into any of the foregoing), whether
or not any such transaction is governed by or subject to any master agreement,
and (b) any and all transactions of any kind, and the related confirmations,
which are subject to the terms and conditions of, or are governed by, any form
of master agreement published by the International Swaps and Derivative
Association, Inc., any International Foreign Exchange Master Agreement or any
other master agreement (including such master agreement, together with any
related schedules, a "Master Agreement") including any such obligations or
liabilities under any Master Agreement.
"Honor Date" has the meaning specified in Section 2.03(b)(i).
"Incremental Commitments" has the meaning specified in Section 2.16(a).
"Indemnified Costs" has the meaning specified in Section 7.05(a).
"Indemnified Party" has the meaning specified in Section 8.04(b).
"Information Memorandum" means the information memorandum dated April
2006 used by the Joint Lead Arrangers in connection with the syndication of the
Facilities.
"Initial Borrowing" means the initial Borrowing to be made on the
Closing Date which shall be or is comprised of (a) Term Advances, (b) Revolving
Advances and/or (c) L/C Credit Extensions.
"Initial Issuing Bank" has the meaning specified in the recital of
parties to this Agreement.
"Initial Lender Parties" has the meaning specified in the recital of
parties to this
Agreement.
"Initial Lenders" has the meaning specified in the recital of parties
to this Agreement.
"Insolvency Proceeding" means, with respect to any Person, (a) any
proceeding which shall be instituted against such Person seeking to adjudicate
it a bankrupt or insolvent, or seeking liquidation, winding up, reorganization,
arrangement, adjustment, protection, relief, or composition of it or its debts
under any law relating to bankruptcy, insolvency or reorganization or relief of
debtors, or seeking the entry of an order for relief or the appointment of a
receiver, trustee or other similar official for it or for any substantial part
of its property and either such proceeding shall remain undismissed or unstayed
for a period of 60 consecutive days or the entry by any competent Governmental
Authority of any jurisdiction or a court having jurisdiction in the premises of
a decree or order approving or ordering any of the actions sought in such
proceeding (including the entry of an order for relief against, or the
appointment of a receiver, trustee, custodian or other similar official for, it
or any substantial part of its property); or (b) commencement by such Person of
a voluntary case or proceeding under any applicable bankruptcy, insolvency,
reorganization or other similar law or of any other case or proceeding to be
adjudicated as bankrupt or insolvent, or the consent by such Person to the entry
of a decree or order for relief in respect of such Person in an involuntary case
or proceeding under any applicable bankruptcy, insolvency, reorganization or
other similar law or to the commencement of any bankruptcy or insolvency case or
proceeding against such Person, or the filing by such Person of a petition or
answer or consent seeking reorganization or relief under any Applicable Law; or
consent by such Person to the filing of such petition or to the appointment of
or taking possession by a custodian, receiver, liquidator, assignee, trustee,
sequestrator or other similar official of such Person or of any substantial part
of the property of such Person, or the making by such Person of an assignment
for the benefit of creditors or any other marshalling of the assets and
liabilities of such Person, or the admission by such Person in writing of its
inability to pay its debts generally as they become due, or the taking of
corporate action by such Person in furtherance of any such action.
"Interest Coverage Ratio" means, at any date of determination, the
ratio of (a) Consolidated EBITDA for the period of four consecutive fiscal
quarters most recently ended on or prior to such date, taken as one accounting
period, to (b) the Consolidated Interest Expense for the period of four
consecutive fiscal quarters most recently ended on or prior to such date, taken
as one accounting period.
"Interest Period" means, for each Eurodollar Rate Advance comprising
part of the same Borrowing, the period commencing on the date of such Eurodollar
Rate Advance or the date of the Conversion of any Base Rate Advance into such
Eurodollar Rate Advance, and ending on the last day of the period selected by
the Borrower pursuant to the provisions below and, thereafter, each subsequent
period commencing on the last day of the immediately preceding Interest Period
and ending on the last day of the period selected by the Borrower pursuant to
the provisions below. The duration of each such Interest Period shall be one,
two, three or six months or, if available at the time of selection to all
Lenders owed any of the relevant Advances, nine or twelve months, as the
Borrower may, upon notice received by the Administrative Agent not later than
12:00 noon (New York City time) on the third Business Day prior to the first day
of such Interest Period (or in the case of any Conversion of any Base Rate
Advance into a Eurodollar Rate Advance requested to occur within three Business
Days after the Closing Date in accordance with Section 2.11(a)(ii), upon notice
received by the Administrative Agent by such time and with such shorter prior
notice as may be agreed by the Administrative Agent); provided, however, that:
(a) the Borrower may not select any Interest Period with respect to
any Eurodollar Rate Advance that ends after the date specified in clause
(b) of the definition of "Final Maturity Date";
(b) the Borrower may not select any Interest Period if, after giving
effect to such selection, there are more than fifteen different Interest
Periods applicable to all Eurodollar Rate Advances then outstanding;
(c) whenever the last day of any Interest Period would otherwise occur
on a day other than a Business Day, the last day of such Interest Period
shall be extended to occur on the next succeeding Business Day, provided
that, if such extension would cause the last day of such Interest Period to
occur in the next following calendar month, the last day of such Interest
Period shall occur on the next preceding Business Day; and
(d) whenever the first day of any Interest Period occurs on a day of
an initial calendar month for which there is no numerically corresponding
day in the calendar month that succeeds such initial calendar month by the
number of months equal to the number of months in such Interest Period,
such Interest Period shall end on the last Business Day of such succeeding
calendar month.
"Intralinks" means the digital internet workspace located at
▇▇▇▇://▇▇▇.▇▇▇▇▇▇▇▇▇▇.▇▇▇.
"Investment" in any Person means any loan or advance to such Person,
any purchase or other acquisition of any Equity Interests or Debt or the Assets
comprising a division or business unit or a substantial part or all of the
business of such Person, any capital contribution to such Person or any other
direct or indirect investment in such Person, including any acquisition by way
of a merger or consolidation and any arrangement pursuant to which the investor
incurs Debt of the types referred to in clause (j) or (k) of the definition of
"Debt" in respect of such Person.
"ISP" means, with respect to any Letter of Credit, the "International
Standby Practices 1998" published by the Institute of International Banking Law
& Practice (or such later version thereof as may be in effect at the time of
issuance of such Letter of Credit).
"Issuer Documents" means, with respect to any Letter of Credit, the
Letter of Credit Application and any other document, agreement and instrument
entered into by any Issuing Bank and the Borrower or in favor of any Issuing
Bank and relating to any such Letter of Credit.
"Issuing Bank" means the Initial Issuing Bank, any Revolving Lender
issuing Letters of Credit hereunder and each Person that shall become an Issuing
Bank hereunder pursuant to Section 8.07.
"Joint Lead Arrangers" means CGMI, Scotia Capital and BAS, not in their
respective individual capacities except as expressly set forth herein but solely
as joint lead arrangers.
"Joint Venture" means, with respect to any Person, at any date, any
other Person in whom such Person directly or indirectly holds an Investment
consisting of an Equity Interest and whose financial results would not be
considered under GAAP with the financial results of such Person on the
Consolidated financial statements of such Person, if such statements were
prepared in accordance with GAAP as of such date.
"L/C Advance" means, with respect to each Revolving Lender, such
Revolving Lender's funding of its participation in any L/C Borrowing in
accordance with its Pro Rata Share.
"L/C Borrowing" means an extension of credit resulting from a drawing
under any Letter of Credit which has not been reimbursed on the date when made
or refinanced as a Borrowing.
"L/C Credit Extension" means, with respect to any Letter of Credit, the
issuance thereof or extension of the expiry date thereof, or the increase of the
amount thereof.
"L/C Obligations" means, as at any date of determination, the aggregate
undrawn amount of all outstanding Letters of Credit plus the aggregate of all
Unreimbursed Amounts, including all L/C Borrowings. For all purposes of this
Agreement, if on any date of determination a Letter of Credit has expired by its
terms but any amount may still be drawn thereunder by reason of the operation of
Rule 3.14 of the ISP, such Letter of Credit shall be deemed to be "outstanding"
in the amount so remaining available to be drawn.
"Lender" means each Initial Lender and each other Person that shall
become a Lender hereunder pursuant to Section 8.07 for so long as such Initial
Lender or Person, as the case may be, shall be a party to this Agreement.
"Lender Parties" means the Lenders and the Issuing Banks.
"Letter of Credit Application" means an application and agreement for
the issuance or amendment of a Letter of Credit to be issued hereunder by any
Issuing Bank in the form from time to time in use by such Issuing Bank.
"Letter of Credit Expiration Date" means the day that is five Business
Days prior to the date specified in clause (b) of the definition of "Final
Maturity Date" (or, if such day is not a Business Day, the next preceding
Business Day).
"Letter of Credit Fee" has the meaning specified in Section 2.08(b).
"Letters of Credit" means letters of credit issued by any Issuing Bank
pursuant to Section 2.01(d).
"Leverage Ratio" means, as of any date of determination, the ratio of
(a) Consolidated Debt for Borrowed Money of the Borrower as at such date, to (b)
Consolidated EBITDA for the period of four consecutive fiscal quarters most
recently ended on or prior to such date, taken as one accounting period.
"LIBOR" means, for any applicable Interest Period with respect to all
Eurodollar Rate Advances comprising part of the same Borrowing, the British
Bankers' Association Interest Settlement Rate per annum for deposits in Dollars
for a period equal to such Interest Period appearing on the display designated
as Page 3750 on the Dow ▇▇▇▇▇ Markets Service (or such other page on that
service or such other service designated by the British Bankers' Association for
the display of such Association's Interest Settlement Rates for Dollar deposits)
as of 11:00 a.m. (London, England time) on the day that is two Business Days
prior to the first day of the Interest Period or, if such Page 3750 is
unavailable for any reason at such time, the rate which appears on the Reuters
Screen LIBOR 01 Page as of such date and such time; provided that if the
Administrative Agent determines that the relevant foregoing sources are
unavailable for the relevant Interest Period, LIBOR shall mean the rate of
interest determined by the Administrative Agent to be the average (rounded
upward, if necessary, to the nearest 1/1,000th of 1%) of the rates per annum at
which deposits in Dollars are offered to the Administrative Agent two Business
Days preceding the first day of such Interest Period by leading banks in the
London interbank market as of 10:00 a.m. (New York City time) for delivery on
the first day of such Interest Period, for the number of days comprised therein
and in an amount comparable to the amount of the Eurodollar Rate Advance of CUSA
(in its capacity as a Lender).
"Lien" means any lien, mortgage, deed of trust, pledge, security
interest or other charge or encumbrance of any kind, including the lien or
retained security title of a conditional vendor and any easement, right of way
or other encumbrance on title to real property.
"Margin Stock" has the meaning specified in Regulation U of the Board
of Governors of the Federal Reserve System, as in effect from time to time.
"Material Adverse Change" means any material adverse change in the
business, financial condition, operations or properties of the Borrower and its
Subsidiaries, taken as a whole.
"Material Adverse Effect" means a material adverse effect on (a) the
business, financial condition, operations or properties of the Borrower and its
Subsidiaries, taken as a whole, (b) the rights and remedies of any Secured Party
under any Financing Document or (c) the ability of the Borrower to perform its
Obligations under the Financing Documents.
"Material Property" means such real property of the Borrower (other
than Excluded Assets), which real property (a) has a book value greater than or
equal to $10,000,000 (including any such real property acquired in connection
with a Permitted Asset Swap), (b) is subject to a Mortgage or (c) is otherwise
material to the value of any real property of the Borrower which is subject to a
Lien under the Mortgages.
"Material Subsidiary" means, collectively, (a) AE Capital, (b) any
Subsidiary (other than AE Capital) of the Borrower existing as of the Closing
Date which, after the Closing Date, acquires Assets, including any deposit or
securities accounts, with a book value in excess of $250,000,000 in the
aggregate, (c) any Subsidiary of the Borrower incorporated or formed after the
Closing Date, or any Person that becomes a Subsidiary of the Borrower after the
Closing Date, in each case, that holds Assets, including any deposit or
securities accounts, with a book value in excess of $250,000,000 in the
aggregate and (d) any other Subsidiary of the Borrower designated as a "Material
Subsidiary" by the Borrower to the Administrative Agent in writing.
"▇▇▇▇▇▇▇ ▇▇▇▇▇ Litigation" means that litigation arising out of that
complaint filed under the caption ▇▇▇▇▇▇▇ ▇▇▇▇▇ & Co., Inc., et al. v. Allegheny
Energy, Inc., and Allegheny Energy, Inc., et al. ▇. ▇▇▇▇▇▇▇ ▇▇▇▇▇ & Co., Inc.,
et al. (02 CV 7689 (HB)).
"ML Interests" means the up to 2% of all issued and outstanding Equity
Interests in the Borrower which are owned by ML IBK Positions, Inc, a Delaware
corporation.
"Moody's" means ▇▇▇▇▇'▇ Investors Service, Inc.
"Mortgage Policies" means the title insurance policies insuring the
Amended and Restated Mortgages marked on Schedule 1.01(a) as having been
insured.
"Mortgages" means the Amended and Restated Mortgages (as amended by the
Amendments), the New Mortgages and any other mortgage, deed of trust, trust
deed, leasehold mortgage or leasehold deed of trust recorded and filed with any
necessary recording office from time to time in order to create a valid Lien
over the Collateral in favor of the Secured Parties in respect of the Secured
Obligations owed to such Secured Parties pursuant to the terms of this Agreement
or the Security Agreement.
"MPC" means Monongahela Power Company, a corporation incorporated under
the laws of the State of Ohio.
"Multiemployer Plan" means a multiemployer plan, as defined in Section
4001(a)(3) of ERISA, to which the Borrower or any of its Subsidiaries or any
ERISA Affiliate is making or accruing an obligation to make contributions, or
has within any of the preceding five plan years made or accrued an obligation to
make contributions.
"Multiple Employer Plan" means a single employer plan, as defined in
Section 4001(a)(15) of ERISA, that (a) is maintained for employees of the
Borrower or any of its Subsidiaries or any ERISA Affiliate and at least one
Person other than the Borrower, its Subsidiaries and the ERISA Affiliates or (b)
was so maintained and in respect of which the Borrower and any of its
Subsidiaries or any ERISA Affiliate could have liability under Section 4064 or
4069 of ERISA in the event such plan has been or were to be terminated.
"Net Cash Proceeds" means, with respect to any sale, lease, transfer or
other disposition of any Assets, the aggregate amount of cash received from time
to time (whether as initial consideration or through payment or disposition of
deferred consideration or received from escrow) by or on behalf of such Person
in connection with such transaction after deducting therefrom only (without
duplication) the following (to the extent directly and primarily relating to
such transaction): (a) reasonable and customary brokerage commissions,
underwriting fees and discounts, legal, consultant and advisor fees, finder's
fees and other similar fees and commissions, (b) the amount of Taxes (or amounts
owing pursuant to the Tax Allocation Agreement) payable in connection with or as
a result of such transaction, (c) the amount of (i) any Debt secured by a prior
Lien on the Asset which is the subject of such sale, lease, transfer or other
disposition or (ii) Debt outstanding under the Pollution Control Bonds that is,
in either case, repaid, redeemed or defeased upon such disposition as required
pursuant to the terms of (1) the agreement or instrument governing such Debt or
(2) any undertaking or agreement of the Borrower made on or prior to February
21, 2003 in favor of the issuer of any guaranty, surety bond or insurance policy
issued for the benefit of the holders of such Debt, including each of the
consents, dated February 21, 2003, entered into among (A) the Borrower, PEC and
MBIA Insurance Corporation and (B) the Borrower, WPPC and MBIA Insurance
Corporation, (d) the costs associated (in the Borrower's best estimate) with
terminating all Hedge Agreements, if any, entered into in connection with such
Asset, which Hedge Agreements are not being transferred as part of such sale,
lease, transfer or other disposition, but only to the extent that the amounts so
deducted are, at the time or within a reasonable time (not to exceed ten days)
of receipt of such cash, actually paid to a Person that is not an Affiliate of
such Person or any Affiliate of the Borrower and are properly attributable to
such transaction or to the Asset that is the subject thereof, and (e) any
amounts received from funds that were held in escrow as of the Closing Date with
respect to any sale, lease, transfer or other disposition of any Asset
consummated prior to the Closing Date; provided that, in the case of Taxes or
termination costs that are deductible under clause (b) or (c)(ii) above but for
the fact that, at the time of receipt of such cash, such amounts have not been
actually paid or are not then payable, such Person may deduct an amount (the
"Reserved Amount") equal to the amount reserved in accordance with GAAP for such
Person's reasonable estimate of such amounts, other than Taxes for which such
Person is indemnified; provided further that, at the time such amounts are paid,
an amount equal to the amount, if any, by which the Reserved Amount for such
amounts exceeds the amount of such amounts actually paid shall constitute "Net
Cash Proceeds" of the type for which such amounts were reserved for all purposes
hereunder.
"New Mortgages" has the meaning specified in Section 5.01(l).
"Non-Extension Notice Date" has the meaning specified in Section
2.03(a)(iii).
"Non-UCC Property" means any of the Collateral consisting of personal
property the creation, granting or perfection of a Lien upon or in which is
governed by Applicable Law other than the UCC and Applicable Law under, or
relating to, the UCC.
"Note" means a Revolving Note or a Term Note, as the context may
require.
"Notice of Borrowing" has the meaning specified in Section 2.02(a).
"Notice of Conversion/Continuation" has the meaning specified in
Section 2.11(a)(ii).
"Notice of Swing Line Borrowing" has the meaning specified in Section
2.02(c).
"NPL" means the National Priorities List under CERCLA.
"Obligation" means, with respect to any Person, any payment,
performance or other obligation of such Person of any kind, including any
liability of such Person on any claim, whether or not the right of any creditor
to payment in respect of such claim is reduced to judgment, liquidated,
unliquidated, fixed, contingent, matured, disputed, undisputed, legal,
equitable, secured or unsecured, and whether or not such claim is discharged,
stayed or otherwise affected by any proceeding referred to in Section 6.01(g).
Without limiting the generality of the foregoing, the Obligations of the
Borrower under the Financing Documents include (a) the obligation to pay
principal, interest, Letter of Credit commissions, charges, expenses, fees,
attorneys' and consultants' fees and disbursements, indemnities and other
amounts payable by the Borrower under any Financing Document and (b) the
obligation to reimburse any amount in respect of any of the foregoing that any
Secured Party, in its sole discretion, may elect to pay or advance on behalf of
the Borrower.
"OECD" means the Organization for Economic Cooperation and Development.
"Officer's Certificate" means, with respect to any Person, a
certificate signed by a Responsible Officer of such Person.
"Other Perfection Requirements" means (a) the giving of notice to any
Person (other than an Affiliate of the Borrower) of the Liens created by the
Borrower under the Collateral Documents and (b) any recording, notice, filing,
registration, instrument or act required to be undertaken, made or executed in
order to grant or perfect any Lien over Non-UCC Property.
"Other Taxes" has the meaning specified in Section 2.13(b).
"Outstanding Amount" means (a) with respect to the Revolving Facility
on any date, the aggregate outstanding principal amount thereof after giving
effect to any Revolving Borrowings, Swing Line Borrowings and prepayments of the
Revolving Facility and Swing Line Facility occurring on such date; and (b) with
respect to any L/C Obligations on any date, the amount of such L/C Obligations
on such date after giving effect to any relevant L/C Credit Extension occurring
on such date and any other changes in the aggregate amount of such L/C
Obligations as of such date, including as a result of any reimbursements of
outstanding unpaid drawings under any relevant Letters of Credit or any
reductions in the maximum amount available for drawing under any relevant
Letters of Credit taking effect on such date.
"PA Report" means the Independent Market Expert's Report for the PJM,
MISO, and SERC-TVA Regions, dated June 24, 2005, prepared by PA Consulting
Group.
"Parent" means Allegheny Energy, Inc., the parent company of the
Borrower.
"Parent Credit Agreement" means that certain Credit Agreement, dated as
of June 16, 2005, among the Parent, the Borrower, the lenders and issuing bank
party thereto, and CNAI, as administrative agent.
"PBGC" means the Pension Benefit Guaranty Corporation (or any
successor).
"PEC" means The Potomac Edison Company, a Maryland and Virginia
corporation.
"PEC Service Agreement" means that certain Service Agreement, dated as
of August 1, 2000, between the Borrower and PEC (d/b/a Allegheny Power).
"Permitted Asset Swap" has the meaning specified in Section
5.02(d)(i)(I).
"Permitted Liens" means such of the following as to which no
enforcement, collection, execution, levy or foreclosure proceeding shall have
been commenced: (a) Liens for taxes, assessments and governmental charges or
levies to the extent not required to be paid under Section 5.01(d); (b) Liens
imposed by law, such as materialmen's, mechanics', carriers', workmen's and
repairmen's Liens and other similar Liens arising in the ordinary course of
business securing obligations that are not overdue for a period of more than 30
days, or which are subject to Contest; (c) Liens or deposits to secure
obligations under workers' compensation laws or similar legislation or to secure
public or statutory obligations; (d) deposits to secure the performance of bids,
leases (other than Capitalized Leases), trade contracts, public or statutory
obligations (including environmental, municipal and public utility commission
obligations under Applicable Laws), surety bonds (other than bonds related to
judgments or litigation), performance bonds and other obligations of a like
nature incurred in the ordinary course of business; (e) Liens securing judgments
for the payment of money not constituting an Event of Default under Section
6.01(h) or securing appeal or other surety bonds related to such judgments; (f)
zoning restrictions, easements, rights of way and other encumbrances on title to
real property that do not render title to the property encumbered thereby
unmarketable or materially adversely affect the use of such property for its
present purposes; (g) Liens securing reimbursement obligations with respect to
letters of credit (which reimbursement obligations relate to Debt which has not
been incurred in contravention of the terms of this Agreement and the other
Financing Documents) that encumber documents and other property relating to such
letters of credit and the proceeds and products thereof, including such Liens
arising in connection with the issuance of letters of credit on behalf of the
Parent to support obligations of the Borrower and its Subsidiaries under Hedge
Agreements to the extent that such Hedge Agreements are entered into in
accordance with the terms of this Agreement; (h) Liens on cash deposits in the
nature of a right of setoff, banker's lien, counterclaim or netting of cash
amounts owed arising in the ordinary course of business on deposit accounts,
commodity accounts or securities accounts; (i) financing statements filed on a
precautionary basis in respect of operating leases to the extent such lease is
otherwise permitted under the terms of this Agreement; provided that no such
financing statement extends to or refers to as collateral any Assets which are
not subject to such operating lease; and (j) rights of first refusal, options or
other contractual rights or obligations to sell, assign or otherwise dispose of
any Asset or interest therein which rights of first refusal, option or
contractual right is in connection with a sale, transfer or other disposition of
Assets permitted under Section 5.02(c) or 5.02(d).
"Permitted Refinancing Debt" means Debt issued or incurred (including
by means of the extension or renewal of existing Debt) to refinance, refund,
extend, renew or replace existing Debt ("Refinanced Debt") concurrently with, or
within 90 days after, the issuance or incurrence of such Debt; provided that (a)
the principal amount of such refinancing, refunding, extending, renewing or
replacing Debt is not greater than the principal amount of such Refinanced Debt
plus the amount of any premiums or penalties and accrued and unpaid interest
paid thereon and reasonable fees and expenses, in each case associated with such
refinancing, refunding, extension, renewal or replacement, (b) such refinancing,
refunding, extending, renewing or replacing Debt has a final maturity date that
is no sooner than, and a weighted average life to maturity that is no shorter
than, such Refinanced Debt, (c) if such Refinanced Debt is subordinated to the
Secured Obligations hereunder, such refinancing, refunding, extending, renewing
or replacing Debt remains so subordinated on terms no less favorable to the
Lenders, (d) the obligors in respect of such Refinanced Debt immediately prior
to such refinancing, refunding, extending, renewing or replacing and any
additional person (other than the Borrower and the Material Subsidiaries) are
the only obligors on such refinancing, refunding, extending, renewing or
replacing Debt and (e) such refinancing, refunding, extending, renewing or
replacing Debt contains covenants and events of default which, taken as a whole,
are determined in good faith by a Responsible Officer of the Borrower to be
customary for similar issuances of Debt by issuers of a similar credit rating or
standing as the credit rating then applicable to the Borrower.
"Permitted Second Priority Liens" means second priority Liens (a)
securing Obligations of the Borrower or any of its Subsidiaries under Commodity
Hedge Agreements, (b) which are junior only to the Liens securing the Senior
Debt Obligations and (c) the holders of which have entered into an intercreditor
agreement with the Borrower, the Collateral Agent and the Administrative Agent
on terms and conditions (i) specified in (or substantially similar to the terms
and conditions specified in) Exhibit E or (ii) to the extent not materially
adverse to the rights of the Secured Parties, as such rights are set forth in
Exhibit E, on such other terms and conditions which are (A) customary for
intercreditor agreements with parties to Commodity Hedge Agreements or (B)
reasonably acceptable to the Administrative Agent.
"Person" means an individual, partnership, corporation (including a
business or statutory trust), limited liability company, joint stock company,
trust, unincorporated association, joint venture or other entity, or a
government or any political subdivision or agency thereof.
"Plan" means a Single-Employer Plan or a Multiple Employer Plan.
"Platform" has the meaning specified in Section 8.02(c).
"Pledged Account" means any deposit or securities account maintained in
the name of the Collateral Agent and under the sole control and dominion of the
Collateral Agent pursuant to the terms of the Security Agreement.
"Pledged Debt" has the meaning set forth in the Security Agreement.
"Pledged Equity Interest" has the meaning set forth in the Security
Agreement.
"PNC Control Agreement" has the meaning set forth in Section
3.01(a)(v).
"Pollution Control Bond Indentures" means (a) the Trust Indenture dated
as of April 15, 1992 between the County Commission of ▇▇▇▇▇▇▇▇ County, West
Virginia and ▇.▇. ▇▇▇▇▇▇ Trust Company, National Association (formerly Chase
Manhattan Trust Company, National Association, successor trustee to Mellon Bank,
N.A.), as Trustee, providing for Solid Waste Disposal Revenue Bonds (West Penn
Power Company ▇▇▇▇▇▇▇▇ Station Project), (b) the Trust Indenture dated as of
November 1, ▇▇▇▇ ▇▇▇▇▇▇▇ ▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇▇, ▇▇▇▇ ▇▇▇▇▇▇▇▇ and ▇.▇. ▇▇▇▇▇▇ Trust
Company, National Association (formerly Chase Manhattan Trust Company, National
Association, successor trustee to Mellon Bank, N.A.), as Trustee, providing for
Pollution Control Revenue Bonds (West Penn Power Company ▇▇▇▇▇▇▇▇▇ Station
Project), (c) the Trust Indenture dated as of December 1, 1980 between
Washington County Industrial Development Authority and ▇.▇. ▇▇▇▇▇▇ Trust
Company, National Association (formerly Chase Manhattan Trust Company, National
Association, successor trustee to Mellon Bank, N.A.), as Trustee, providing for
Pollution Control Revenue Bonds (West Penn Power Company ▇▇▇▇▇▇▇▇ Station
Project), (d) the Trust Indenture dated as of April 15, 1983 between the County
Commission of Monongalia County, West Virginia and ▇.▇. ▇▇▇▇▇▇ Trust Company,
National Association (formerly Chase Manhattan Trust Company, National
Association, successor trustee to Mellon Bank, N.A.), as Trustee, providing for
Pollution Control Revenue Bonds (West Penn Power Company Fort ▇▇▇▇▇▇ Station
Project), (e) the Trust Indenture dated as of February 1, 1977 between ▇▇▇▇▇▇
County Industrial Development Authority and ▇.▇. ▇▇▇▇▇▇ Trust Company, National
Association (formerly Chase Manhattan Trust Company, National Association,
successor trustee to Mellon Bank, N.A.), as Trustee, providing for Pollution
Control Revenue Bonds (West Penn Power Company ▇▇▇▇▇▇▇▇'▇ Ferry Project), (f)
the Trust Indenture dated as of April 15, 1992 between the County Commission of
▇▇▇▇▇▇▇▇ County, West Virginia and ▇.▇. ▇▇▇▇▇▇ Trust Company, National
Association (formerly Chase Manhattan Trust Company, National Association,
successor trustee to Mellon Bank, N.A.), as Trustee, providing for Solid Waste
Disposal Revenue Bonds (The Potomac Edison Company ▇▇▇▇▇▇▇▇ Station Project),
(g) the Trust Indenture dated as of November 1, ▇▇▇▇ ▇▇▇▇▇▇▇ ▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇▇,
▇▇▇▇ ▇▇▇▇▇▇▇▇ and ▇.▇. ▇▇▇▇▇▇ Trust Company, National Association (formerly
Chase Manhattan Trust Company, National Association, successor trustee to Mellon
Bank, N.A.), as Trustee, providing for Pollution Control Revenue Bonds (The
Potomac Edison Company ▇▇▇▇▇▇▇▇▇ Station Project), (h) the Trust Indenture dated
as of April 15, 1983 between the County Commission of Monongalia County, West
Virginia and ▇.▇. ▇▇▇▇▇▇ Trust Company, National Association (formerly Chase
Manhattan Trust Company, National Association, successor trustee to Mellon Bank,
N.A.), as Trustee, providing for Pollution Control Revenue Bonds (The Potomac
Edison Company Fort ▇▇▇▇▇▇ Station Project), (i) the Trust Indenture dated as of
February 1, 1977 between ▇▇▇▇▇▇ County Industrial Development Authority and ▇.▇.
▇▇▇▇▇▇ Trust Company, National Association (formerly Chase Manhattan Trust
Company, National Association, successor trustee to Mellon Bank, N.A.), as
Trustee, providing for Pollution Control Revenue Bonds (Monongahela Power
Company ▇▇▇▇▇▇▇▇'▇ Ferry Project), (j) the Trust Indenture dated as of November
1, ▇▇▇▇ ▇▇▇▇▇▇▇ ▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇▇, ▇▇▇▇ ▇▇▇▇▇▇▇▇ and ▇.▇. ▇▇▇▇▇▇ Trust Company,
National Association (formerly Chase Manhattan Trust Company, National
Association, successor trustee to Mellon Bank, N.A.), as Trustee, providing for
Pollution Control Revenue Bonds (Monongahela Power Company ▇▇▇▇▇▇▇▇▇ Station
Project), (k) the Trust Indenture dated as of April 15, 1983 between the County
Commission of Monongalia County, West Virginia and ▇.▇. ▇▇▇▇▇▇ Trust Company,
National Association (formerly Chase Manhattan Trust Company, National
Association, successor trustee to Mellon Bank, N.A.), as Trustee, providing for
Pollution Control Revenue Bonds (Monongahela Power Company Fort ▇▇▇▇▇▇ Station
Project), and (l) Trust Indenture dated as of April 15, 1992 between the County
Commission of ▇▇▇▇▇▇▇▇ County, West Virginia and ▇.▇. ▇▇▇▇▇▇ Trust Company,
National Association (formerly Chase Manhattan Trust Company, National
Association, successor trustee to Mellon Bank, N.A.), as Trustee, providing for
Solid Waste Disposal Revenue Bonds (Monongahela Power Company ▇▇▇▇▇▇▇▇ Station
Project).
"Pollution Control Bonds" means all notes, bonds and other instruments
evidencing Debt issued pursuant to the Pollution Control Bond Indentures.
"Preferred Interests" means, with respect to any Person, Equity
Interests issued by such Person that are entitled to a preference or priority
over any other Equity Interests issued by such Person upon any distribution of
such Person's Assets, whether by dividend or upon liquidation.
"Pro Rata Share" means, with respect to each Revolving Lender at any
time, a fraction (expressed as a percentage, carried out to the ninth decimal
place), the numerator of which is the amount of the Revolving Commitment of such
Revolving Lender and the denominator of which is the amount of the Revolving
Facility; provided that if the commitment of each Revolving Lender to make
Revolving Advances and the obligation of each Issuing Bank to make L/C Credit
Extensions have been terminated pursuant to Section 2.05 or 6.01, then the Pro
Rata Share of each Revolving Lender shall be determined based on the Pro Rata
Share of such Revolving Lender immediately prior to such termination and after
giving effect to any subsequent assignments made pursuant to the terms hereof.
The initial Pro Rata Share of each Revolving Lender is set forth opposite the
name of such Revolving Lender on Schedule I or in the Assignment and Assumption
pursuant to which such Lender becomes a party hereto, as applicable.
"Public Debt Rating" means, as of any date, the higher rating that has
been most recently announced by either S&P or ▇▇▇▇▇'▇, as the case may be (i) if
prior to the Collateral Release Date, for any class of non-credit enhanced
long-term senior secured debt issued by the Borrower or (ii) if on or after the
Collateral Release Date, the non-credit enhanced long-term senior unsecured debt
issued by the Borrower; provided that (a) if only one of S&P and ▇▇▇▇▇'▇ shall
have in effect a Public Debt Rating or if neither S&P nor ▇▇▇▇▇'▇ shall have in
effect a Public Debt Rating, the Applicable Margin and Commitment Fee Rate will
be determined in accordance with Level 6 under the definition of "Applicable
Margin" and "Commitment Fee Rate", respectively; (b) if such ratings established
by S&P and ▇▇▇▇▇'▇ shall differ by one level, the Applicable Margin and
Commitment Fee Rate shall be determined in accordance with the higher rating;
(c) if such ratings established by S&P and ▇▇▇▇▇'▇ shall differ by two or more
levels, the Applicable Margin and Commitment Fee Rate shall be based upon the
rating which is one rating level higher than the lower of the ratings
established by S&P and ▇▇▇▇▇'▇; (d) if any rating established by S&P or ▇▇▇▇▇'▇
shall be changed, such change shall be effective as of the date on which such
change is first announced publicly by the rating agency making such change; and
(e) if S&P or ▇▇▇▇▇'▇ shall change the basis on which ratings are established,
each reference to the Public Debt Rating announced by S&P or ▇▇▇▇▇'▇, as the
case may be, shall refer to the then equivalent rating by S&P or ▇▇▇▇▇'▇, as the
case may be. If the rating system of ▇▇▇▇▇'▇ or S&P applicable to any class of
non-credit enhanced long-term senior secured or unsecured debt shall change in
any material respect, or if either such rating agency shall cease to be in the
business of rating corporate debt obligations, the Borrower and the Required
Lenders shall negotiate in good faith to amend this definition to reflect such
changed rating system or the unavailability of ratings from such rating agency
and pending the effectiveness of any such amendment, the Applicable Margin and
the Commitment Fee Rate shall be determined by reference to the ratings most
recently in effect prior to such change or cessation.
"Quarterly Date" means the last Business Day of March, June, September
and December, commencing with June 30, 2006.
"Real Property Requirements" means the requirements contained in
Exhibit G with respect to the creation and perfection of any Lien over any of
the real property of the Borrower which is subject to a prior Mortgage.
"Recorded Term Mortgages" has the meaning specified in Section 5.01(l).
"Recovery Event" means (a) any act, series of acts, omissions or series
of omissions of any Governmental Authority for the confiscation, condemnation,
expropriation, nationalization, seizure or other taking of any Asset of the
Borrower or any Material Subsidiary or (b) any event that causes any Asset (or
portion thereof) of the Borrower or any Material Subsidiary to be damaged,
destroyed or rendered unfit for normal use for any reason whatsoever.
"Recovery Event Proceeds" means the amount of cash proceeds paid to the
Borrower or any Material Subsidiary in respect of any Recovery Event but
excluding any such proceeds paid under any advance loss of profit insurance,
delayed start-up insurance, liability, business interruption or similar types of
insurance.
"Redeemable" means, with respect to any Preferred Interests, any such
Preferred Interests that the issuer is required, pursuant to the terms and
conditions thereof, to redeem at a fixed or determinable date or dates, whether
by operation of a sinking fund or otherwise, or upon the occurrence of a
condition not solely within the control of the issuer.
"Reduction Amount" has the meaning specified in Section 2.06(b)(iii).
"Register" has the meaning specified in Section 8.07(e).
"Related Fund" means, with respect to any Lender or Eligible Assignee
that is a Fund, any other Fund that is administered or managed by the same
Person as such Lender or Eligible Assignee or by an Affiliate of such Person.
"Representatives" has the meaning specified in Section 8.12(a).
"Required Lenders" means, at any time, Lenders owed or holding at least
a majority in interest of the sum of (a) the Total Revolving Outstandings (with
the aggregate amount of each Lender's risk participation and funded
participation in L/C Obligations and Swing Line Advances made by the L/C Issuer
or Swing Line Bank, as applicable being deemed "held" by such Lender for
purposes of this definition) (if any) at such time, plus (b) the aggregate
Unused Commitments at such time, plus (c) the aggregate outstanding principal
amount of the Term Advances (if any) at such time, plus (d) the aggregate amount
of the Term Commitments (if any) at such time, plus (d) the aggregate amount of
the Incremental Commitments (if any) at such time.
"Required Revolving Lenders" means, at any time, Revolving Lenders owed
or holding at least a majority in interest of the sum of (a) the Total Revolving
Outstandings (with the aggregate amount of each Lender's risk participation and
funded participation in L/C Obligations and Swing Line Advances made by the L/C
Issuer or Swing Line Bank, as applicable being deemed "held" by such Lender for
purposes of this definition) (if any) at such time, plus (b) the aggregate
Unused Commitments (if any) at such time.
"Responsible Officer" means, with respect to any Person, the president,
any vice-president, the treasurer, the chief financial officer or an Authorized
Signatory of such Person.
"Revolving Advance" has the meaning specified in Section 2.01(a).
"Revolving Borrowing" means a borrowing consisting of simultaneous
Revolving Advances of the same Type, made by the Revolving Lenders.
"Revolving Commitment" means, as to each Revolving Lender, its
obligation to: (a) make a Revolving Advance pursuant to Section 2.01(a); and (b)
purchase participations in L/C Obligations pursuant to Section 2.01(d) and Swing
Line Advances pursuant to Section 2.02(c), in an aggregate principal amount at
any one time outstanding not to exceed the amount set forth opposite such
Revolving Lender's name on Schedule I under the caption "Revolving Commitment"
or in the Assignment and Assumption pursuant to which such Lender becomes a
party hereto, as applicable, as such amount may be adjusted from time to time in
accordance with this Agreement.
"Revolving Facility" means, at any time, the aggregate of the Revolving
Commitments at such time.
"Revolving Lender" means any Lender that has a Revolving Commitment.
"Revolving Note" means a promissory note of the Borrower payable to the
order of a Revolving Lender in substantially the form of Exhibit A-1, evidencing
the aggregate indebtedness of the Borrower to such Revolving Lender resulting
from Revolving Advances and Swing Line Advances made by such Revolving Lender
hereunder to the Borrower.
"S&P" means Standard & Poor's Ratings Services, a division of The
▇▇▇▇▇▇-▇▇▇▇ Companies, Inc.
"Sale" means any sale (including by way of sale/leaseback), lease,
assignment, transfer or other disposition.
"Scotia Capital" has the meaning specified in the recital of parties to
this Agreement.
"SEC" means the Securities and Exchange Commission.
"Secured Obligations" has the meaning specified in the Security
Agreement.
"Secured Party" has the meaning specified in the Security Agreement.
"Security Agreement" has the meaning specified in Section 3.01(a)(iii).
"Senior Debt Obligations" means, without duplication, (a) the
Obligations of the Borrower to pay principal and interest on the Advances
(including any interest accruing after the filing of a petition with respect to,
or the commencement of, any Insolvency Proceeding, whether or not a claim for
post-petition interest is allowed in such proceeding); and (b) any and all
commissions, fees, indemnities, prepayment premiums, costs and expenses and
other amounts payable to any Secured Party under any Financing Document,
including all renewals or extensions thereof (including any reimbursement
obligations for costs and expenses incurred by any Secured Party in preserving
any rights, interests and remedies with respect to the Collateral and/or the
Liens granted in favor of the Secured Parties); provided that notwithstanding
anything to the contrary in any Financing Document, "Senior Debt Obligations"
shall not include any Obligations of the Borrower owed to any of its Affiliates.
"Single-Employer Plan" means a single-employer plan, as defined in
Section 4001(a)(15) of ERISA, that (a) is maintained for employees of the
Borrower or any of its Subsidiaries or any ERISA Affiliate and no Person other
than the Borrower, its Subsidiaries and the ERISA Affiliates or (b) was so
maintained and in respect of which the Borrower, any of its Subsidiaries or any
ERISA Affiliate could have liability under Section 4069 of ERISA in the event
such plan has been or were to be terminated.
"▇▇▇▇▇ Facility" means the R. ▇▇▇▇ ▇▇▇▇▇ generation facility located in
Williamsport, Maryland owned by the Borrower, but excluding any related personal
property the creation, granting or perfection of a Lien upon or in which is
governed by the UCC.
"Specified Default" means (a) any Event of Default or (b) any event
that would constitute an Event of Default under clause (a) or (g) of Section
6.01 but for the requirement that notice be given or time elapse or both.
"SPV" has the meaning provided in Section 8.07(h).
"Standby Letter of Credit" means any Letter of Credit issued under this
Agreement, other than a Trade Letter of Credit.
"Subsidiary" of any Person means any corporation, partnership, joint
venture, limited liability company, trust or estate of which (or in which) more
than 50% of (a) the issued and outstanding capital stock having ordinary voting
power to elect a majority of the board of directors of such corporation
(irrespective of whether at the time capital stock of any other class or classes
of such corporation shall or might have voting power upon the occurrence of any
contingency), (b) the interest in the capital or profits of such partnership,
joint venture or limited liability company or (c) the beneficial interest in
such trust or estate is at the time, directly or indirectly owned or controlled
by such Person, by such Person and one or more of its other Subsidiaries or by
one or more of such Person's other Subsidiaries.
"Subsidiary Debt Default" means, with respect to any Subsidiary of the
Borrower, the failure of such Subsidiary to pay any principal or interest or
other amounts due in respect of Debt, when and as the same shall become due and
payable, or the occurrence of any other event or condition that results in any
Debt of such Subsidiary becoming due prior to its scheduled maturity or that
enables or permits (with or without the giving of notice, lapse of time or both)
the holder or holders of such Debt or any trustee or agent on its or their
behalf to cause such Debt to become due, or to require the prepayment,
repurchase, redemption or defeasance thereof, prior to its scheduled maturity.
"Surviving Debt" means Debt of the Borrower and its Subsidiaries
outstanding immediately before and after giving effect to the Transactions.
"Swing Line Advance" means an advance made by (a) the Swing Line Bank
pursuant to Section 2.01(c) or (b) any Revolving Lender pursuant to Section
2.02(c).
"Swing Line Bank" has the meaning specified in the recital of parties
to this Agreement.
"Swing Line Borrowing" means a borrowing consisting of a Swing Line
Advance made by the Swing Line Bank pursuant to Section 2.01(c) or the Revolving
Lenders pursuant to Section 2.02(c).
"Swing Line Facility" has the meaning specified in Section 2.01(c).
"Tax Allocation Agreement" means the Tax Allocation Agreement, dated as
of July 1, 2003, by and among the Parent and its Subsidiaries.
"Taxes" means all federal, state, local or foreign income, gross
receipts, windfall profits, severance, property, production, sales, use, excise,
franchise, employment, value added, real estate, withholding or similar taxes,
assessments, fees, liabilities or other charges, together with any interest,
additions or penalties with respect thereto and any interest in respect of such
additions or penalties.
"Term Advance" means any advance made by a Term Lender pursuant to
Section 2.01(b) or, after the Commitment Effective Date, Section 2.16, as the
context may require.
"Term Borrowing" means the borrowing consisting of simultaneous Term
Advances of the same Type, made by the Term Lenders.
"Term Commitment" means, as to each Term Lender, its obligation to make
a Term Advance pursuant to Section 2.01(b), in an aggregate principal amount at
any one time outstanding not to exceed the amount set forth opposite such Term
Lender's name on Schedule I under the caption "Term Commitment" or in the
Assignment and Assumption pursuant to which such Term Lender becomes a party
hereto, as applicable, as such amount may be adjusted from time to time in
accordance with this Agreement.
"Term Commitment Termination Date" has the meaning specified in Section
2.05(b)(i).
"Term Facility" means, at any time, the aggregate of the Term
Commitments at such time.
"Term Lender" means any Lender that has a Term Commitment.
"Term Note" means a promissory note of the Borrower payable to the
order of a Term Lender in substantially the form of Exhibit A-2, evidencing the
aggregate indebtedness of the Borrower to such Term Lender resulting from Term
Advances made by such Term Lender hereunder, as amended.
"Termination Event" means an event described in Section 4042(a) of
ERISA.
"Total Revolving Outstandings" means the aggregate Outstanding Amount
of all Revolving Advances, all Swing Line Advances and all L/C Obligations.
"Trade Letter of Credit" means any Letter of Credit that is issued
under this Agreement for the benefit of a supplier of goods or services to the
Borrower or any of its Subsidiaries to effect payment for such goods or
services, the conditions to drawing under which include the presentation to an
Issuing Bank.
"Transactions" means the refinancing of Debt outstanding under the
Existing Credit Agreement with the proceeds of the Term Advances and Revolving
Advances.
"Type" refers to the distinction between Advances bearing interest at
the Base Rate and Advances bearing interest at the Eurodollar Rate.
"UCC" or "Uniform Commercial Code" means the Uniform Commercial Code as
in effect, from time to time, in the State of New York; provided that if
perfection or the effect of perfection or non-perfection or the priority of any
security interest in any Collateral is governed by the Uniform Commercial Code
as in effect in a jurisdiction other than the State of New York, "UCC" means the
Uniform Commercial Code as in effect from time to time in such other
jurisdiction for purposes of the provisions hereof relating to such perfection,
effect of perfection or non-perfection or priority.
"Unreimbursed Amount" has the meaning specified in Section 2.03(b)(i).
"Unused Commitment" means, with respect to any Revolving Lender at any
time, (a) such Revolving Lender's Revolving Commitment at such time minus (b)
such Revolving Lender's Pro Rata Share of the Total Revolving Outstandings.
"Voting Interests" means shares of capital stock issued by a
corporation, or equivalent Equity Interests in any other Person, the holders of
which are ordinarily, in the absence of contingencies, entitled to vote for the
election of directors (or persons performing similar functions) of such Person,
even if the right so to vote has been suspended by the happening of such a
contingency.
"Withdrawal Liability" has the meaning specified in Part I of Subtitle
E of Title IV of ERISA.
"WPPC" means West Penn Power Company, a Pennsylvania corporation.
SECTION 1.02. Principles of Interpretation. (a) Except to the extent
expressly provided to the contrary in this Agreement or to the extent that the
context otherwise requires, in this Agreement and the other Financing Documents:
(i) the table of contents and Article and Section headings are for
convenience only and shall not affect the interpretation of any Financing
Document;
(ii) references to any document, instrument or agreement, including
any Financing Document, shall include (A) all exhibits, annexes, schedules,
appendices or other attachments thereto and (B) all documents, instruments
or agreements issued or executed in replacement thereof;
(iii) references to a document or agreement, including any Financing
Document, shall be deemed to include any amendment, restatement,
modification, supplement or replacement thereto entered into in accordance
with the terms thereof and the terms of the Financing Documents;
(iv) the words "include", "includes" and "including" are not
limiting;
(v) references to any Person shall include such Person's successors
and permitted assigns (and, in the case of any Governmental Authority, any
Person succeeding to such Governmental Authority's functions and
capacities);
(vi) the words "hereof", "herein" and "hereunder" and words of
similar import when used in any Financing Document shall refer to such
Financing Document as a whole and not to any particular provision of such
Financing Document;
(vii) references to "days" shall mean calendar days;
(viii) the singular includes the plural and the plural includes the
singular;
(ix) references to Applicable Law, generally, shall mean Applicable
Law as in effect from time to time, and references to any specific
Applicable Law shall mean such Applicable Law, as amended, modified or
supplemented from time to time, and any Applicable Law successor thereto;
(x) in the computation of periods of time from a specified date to a
later specified date, the word "from" means "from and including" and the
words "to" and "until" each mean "to but excluding"; and
(xi) any reference in this Agreement or any other Financing Document
to an Article, Section, Schedule, Appendix or Exhibit is to the article or
section of, or a schedule, appendix or exhibit to, this Agreement or such
other Financing Document, as the case may be, unless otherwise indicated.
(b) This Agreement and the other Financing Documents are the result of
negotiations among the parties hereto and their respective counsel. Accordingly,
this Agreement and the other Financing Documents shall be deemed the product of
all parties hereto or thereto, as the case may be, and no ambiguity in this
Agreement, or any Financing Document shall be construed in favor of or against
the Borrower, any Agent, any Arranger Party or any Lender Party that is a party
hereto.
(c) All accounting terms used herein shall be interpreted, all
accounting determinations hereunder shall be made, and all financial statements
required to be delivered hereunder shall be prepared, in accordance with
generally accepted accounting principles as in effect from time to time, applied
on a basis consistent (except for changes concurred in by the Borrower's
independent public accountants) with the most recent audited consolidated
financial statements of the Borrower and its Subsidiaries delivered to the
Lenders ("GAAP"); provided that, if the Borrower notifies the Administrative
Agent that the Borrower wishes to amend any covenant in Section 5.03 to
eliminate the effect of any change in generally accepted accounting principles
on the operation of such covenant (or if the Administrative Agent notifies the
Borrower that the Required Lenders wish to amend Section 5.03 for such purpose),
then the Borrower's compliance with such covenant shall be determined on the
basis of generally accepted accounting principles in effect immediately before
the relevant change in generally accepted accounting principles became
effective, until either such notice is withdrawn or such covenant is amended in
a manner satisfactory to the Borrower and the Required Lenders.
SECTION 1.03. ...Letter of Credit. Unless otherwise specified, all
references herein to the amount of a Letter of Credit at any time shall be
deemed to mean the stated face amount of such Letter of Credit in effect at such
time; provided, however, that with respect to any Letter of Credit that, by its
terms or the terms of any Issuer Document related thereto, provides for one or
more automatic increases in the stated amount thereof, the amount of such Letter
of Credit shall be deemed the maximum stated amount of such Letter of Credit
after giving effect to all increases thereof, whether or not such maximum face
amount is in effect at such time.
SECTION 1.04. ...Determination of Material Adverse Change and Material
Adverse Effect, Etc. Determinations of materiality generally and determinations
as to whether any fact, event, circumstance, condition or occurrence constitutes
(or could reasonably be expected to constitute) a Material Adverse Effect or a
Material Adverse Change to the extent such determination is made by reference to
the audited financial statements of the Borrower which are subject to a "going
concern" qualification by the Borrower's auditors shall be made without taking
into account or giving effect to such "going concern" opinion.
ARTICLE II
AMOUNTS AND TERMS OF THE ADVANCES
AND LETTERS OF CREDIT
SECTION 2.01. The Advances. (a) Revolving Advance. Each Revolving
Lender severally agrees, on the terms and conditions hereinafter set forth, to
make advances (each a "Revolving Advance") to the Borrower from time to time on
any Business Day during the period from the Closing Date until the Final
Maturity Date in an amount for each such Revolving Advance not to exceed such
Revolving Lender's Unused Commitment at such time; provided that after giving
effect to any Revolving Borrowing, (i) the Total Revolving Outstandings shall
not exceed the Revolving Facility, and (ii) the aggregate Outstanding Amount of
the Revolving Advances of any Revolving Lender plus such Revolving Lender's Pro
Rata Share of the Outstanding Amount of all L/C Obligations plus such Revolving
Lender's Pro Rata Share of the Outstanding Amount of all Swing Line Advances
made by the Swing Line Bank shall not exceed such Revolving Lender's Revolving
Commitment. Each Revolving Borrowing shall be in an aggregate amount of
$2,000,000 or an integral multiple of $1,000,000 in excess thereof (other than a
Revolving Borrowing the proceeds of which shall be used solely to repay or
prepay in full any Swing Line Advances made by the Swing Line Bank or any L/C
Borrowing) and shall consist of Revolving Advances of the same Type made
simultaneously by the Revolving Lenders ratably according to their Revolving
Commitments. Within the limits of each Revolving Lender's Unused Commitment in
effect from time to time, the Borrower may borrow under this Section 2.01(a),
prepay pursuant to Section 2.06(a) and reborrow under this Section 2.01(a).
(b) Term Advance. Each Term Lender severally agrees, on the terms and
conditions hereinafter set forth, to make a single advance to the Borrower on
any one Business Day during the period from the Closing Date until the Term
Commitment Termination Date in an amount not to exceed such Term Lender's Term
Commitment. The Term Borrowing shall consist of Term Advances of the same Type
made simultaneously by the Term Lenders on such Business Day ratably according
to their Term Commitments. Amounts borrowed under this Section 2.01(b) and
repaid or prepaid may not be reborrowed.
(c) Swing Line Advance. The Borrower may request the Swing Line Bank to
make, and the Swing Line Bank agrees to make, on the terms and conditions
hereinafter set forth, Swing Line Advances to the Borrower from time to time on
any Business Day during the period from the Closing Date until the Final
Maturity Date (i) in an aggregate amount not to exceed at any time outstanding
$10,000,000 (the "Swing Line Facility") and (ii) in an amount for each such
Swing Line Borrowing not to exceed the aggregate of the Unused Commitments of
the Revolving Lenders at such time. No Swing Line Advance shall be used for the
purpose of funding the payment of principal of any other Swing Line Advance.
Each Swing Line Borrowing shall be in an amount of $500,000 or an integral
multiple of $100,000 in excess thereof and shall be made as a Base Rate Advance.
Within the limits of the Swing Line Facility and within the limits referred to
in clause (ii) above, the Borrower may borrow under this Section 2.01(c), repay
pursuant to Section 2.04 or prepay pursuant to Section 2.06(a) and reborrow
under this Section 2.01(c).
(d) Letters of Credit. Subject to the terms and conditions set forth
herein, (i) each Issuing Bank agrees, in reliance upon the agreements of the
other Revolving Lenders set forth in Section 2.03, (A) from time to time on any
Business Day during the period from the Closing Date until the Letter of Credit
Expiration Date, to make L/C Credit Extensions for the account of the Borrower
or its Subsidiaries, and to amend or extend Letters of Credit previously issued
by it, in accordance with Section 2.03(a)(i) and (ii), and (B) to honor drawings
under the Letters of Credit issued by it; and (ii) the Revolving Lenders
severally agree to participate in Letters of Credit issued for the account of
the Borrower or its Subsidiaries and any L/C Borrowings thereunder; provided
that after giving effect to any L/C Credit Extension with respect to any Letter
of Credit, (x) the Total Revolving Outstandings shall not exceed the Revolving
Facility and (y) the aggregate Outstanding Amount of the Revolving Advances of
any Revolving Lender, plus such Revolving Lender's Pro Rata Share of the
Outstanding Amount of all L/C Obligations, shall not exceed such Revolving
Lender's Revolving Commitment. Each request by the Borrower for the issuance of,
or an amendment to increase the amount of, any Letter of Credit shall be deemed
to be a representation by the Borrower that the L/C Credit Extension so
requested complies with the conditions set forth in the proviso to the preceding
sentence. Within the foregoing limits, and subject to the terms and conditions
hereof, the Borrower's ability to obtain Letters of Credit shall be fully
revolving, and accordingly the Borrower may, during the foregoing period, obtain
Letters of Credit to replace Letters of Credit that have expired or that have
been drawn upon and reimbursed.
(e) Letters of Credit Generally. (i) No Issuing Bank shall issue
any Letter of Credit if the expiry date of such requested Letter of Credit would
occur after the Letter of Credit Expiration Date, unless all the Revolving
Lenders have approved such expiry date; provided that in no event shall the
expiry date of any requested Letter of Credit occur on or after the Business Day
next preceding the fifth anniversary of the Closing Date.
(ii) No Issuing Bank shall be under any Obligation to make any L/C
Credit Extension if:
(A) any order, judgment or decree of any Governmental
Authority or arbitrator shall by its terms purport to enjoin or
restrain such Issuing Bank from issuing such Letter of Credit, or
any Applicable Law to such Issuing Bank or any request or directive
(whether or not having the force of law) from any Governmental
Authority with jurisdiction over such Issuing Bank shall prohibit,
or request that the Issuing Bank refrain from, the issuance of
Letters of Credit generally or such Letter of Credit in particular
or shall impose upon such Issuing Bank with respect to such Letter
of Credit any restriction, reserve or capital requirement (for which
such Issuing Bank is not otherwise compensated hereunder) not in
effect on the Closing Date, or shall impose upon such Issuing Bank
any unreimbursed loss, cost or expense which was not applicable on
the Closing Date and which such Issuing Bank in good ▇▇▇▇▇ ▇▇▇▇▇
material to it;
(B) the making of such L/C Credit Extension would violate any
Applicable Laws;
(C) except as otherwise agreed by the Administrative Agent and
such Issuing Bank, such Letter of Credit is in an initial face
amount less than $100,000;
(D) such L/C Credit Extension is to be denominated in a
currency other than Dollars;
(E) such L/C Credit Extension contains any provisions for
automatic reinstatement of the stated amount after any L/C Borrowing
thereunder; or
(F) a default of any Revolving Lender's obligations to fund
under Section 2.03 exists, unless such Issuing Bank has entered into
satisfactory arrangements with the Borrower or such Revolving Lender
to eliminate such Issuing Bank's risk with respect to such Revolving
Lender.
(iii) No Issuing Bank shall amend any Letter of Credit if such
Issuing Bank would not be permitted at such time to make such L/C Credit
Extension in its amended form under the terms hereof.
(iv) No Issuing Bank shall be under the obligation to amend any
Letter of Credit if (A) such Issuing Bank would have no obligation at such
time to issue such Letter of Credit in its amended form under the terms
hereof, or (B) the beneficiary of such Letter of Credit does not accept the
proposed amendment to such Letter of Credit.
SECTION 2.02. Making the Advances. (a) Except as otherwise provided in
Section 2.02(c) or 2.03, each Borrowing shall be made on notice, given by the
Borrower not later than 12:00 noon (New York City time) on the third Business
Day prior to the date of the proposed Borrowing in the case of a Borrowing
consisting of Eurodollar Rate Advances, or on the date of the proposed Borrowing
in the case of a Borrowing consisting of Base Rate Advances, to the
Administrative Agent, which shall give to each Appropriate Lender prompt notice
thereof by telecopier or electronic mail. Each such notice of a Borrowing (a
"Notice of Borrowing") shall be by telephone, confirmed immediately in writing,
or telecopier or electronic mail, in substantially the form of Exhibit B,
specifying therein the requested (i) date of such Borrowing, (ii) Type of
Advances comprising such Borrowing, (iii) aggregate amount of such Borrowing and
(iv) in the case of a Borrowing consisting of Eurodollar Rate Advances, initial
Interest Period for each such Advance. Each Lender shall, before 12:00 noon (New
York City time) on the date of such Borrowing, make available for the account of
its Applicable Lending Office to the Administrative Agent at the Administrative
Agent's Account, in immediately available funds, such Lender's ratable portion
of such Borrowing in accordance with the respective Commitment of such Lender
under the applicable Facility and the other Appropriate Lenders. After the
Administrative Agent's receipt of such funds and upon fulfillment of the
applicable conditions set forth in Article III, the Administrative Agent shall
(x) with respect to the Initial Borrowing, directly apply (1) the Revolving
Advances (or such portion thereof as may be specified in writing to the
Administrative Agent by the Borrower) to the repayment of the Existing Debt, and
(2) the Term Advances to the repayment of the Existing Debt and (y) with respect
to subsequent Revolving Borrowings, make such funds available to the Borrower,
by crediting the Borrowing Account; provided, however, that, in the case of any
subsequent Revolving Borrowing, the Administrative Agent shall first make a
portion of such funds equal to the aggregate principal amount of any Swing Line
Advances and L/C Borrowing made by the Swing Line Bank or any Issuing Bank and
by any other Revolving Lender, as the case may be, and outstanding on the date
of such Revolving Borrowing, plus interest accrued and unpaid thereon to and as
of such date, available to the Swing Line Bank or such Issuing Bank or such
other Revolving Lender, as the case may be, for repayment of such Swing Line
Advances and L/C Borrowing.
(b) Anything in subsection (a) above to the contrary notwithstanding,
(i) the Borrower may not select Eurodollar Rate Advances for any Borrowing if
the aggregate amount of such Borrowing is less than $2,000,000 or if the
obligation of the Lenders to make Eurodollar Rate Advances shall then be
suspended pursuant to Section 2.11 or 2.12 and (ii) the Advances may not be
outstanding as part of more than fifteen separate Borrowings.
(c) Each Swing Line Borrowing shall be made on notice, given not later
than 3:00 p.m. (New York City time) on the date of the proposed Swing Line
Borrowing, by the Borrower to the Swing Line Bank and the Administrative Agent.
Each such notice of a Swing Line Borrowing (a "Notice of Swing Line Borrowing")
shall be by telephone, confirmed immediately in writing, or telecopier or
electronic mail, specifying therein the requested (i) date of such Borrowing,
(ii) amount of such Borrowing and (iii) maturity of such Borrowing (which
maturity shall be no later than the seventh day after the requested date of such
Borrowing). The Swing Line Bank will make the amount thereof available to the
Administrative Agent at the Administrative Agent's Account, in same day funds.
After the Administrative Agent's receipt of such funds and upon fulfillment of
the applicable conditions set forth in Article III, the Administrative Agent
will make such funds available to the Borrower by crediting the Borrowing
Account. Upon written demand by the Swing Line Bank, with a copy of such demand
to the Administrative Agent, each other Revolving Lender shall purchase from the
Swing Line Bank, and the Swing Line Bank shall sell and assign to each such
other Revolving Lender, such other Revolving Lender's Pro Rata Share of such
outstanding Swing Line Advance as of the date of such demand, by making
available for the account of its Applicable Lending Office to the Administrative
Agent for the account of the Swing Line Bank, by deposit to the Administrative
Agent's Account, in same day funds, an amount equal to the portion of the
outstanding principal amount of such Swing Line Advance to be purchased by such
Revolving Lender. The Borrower hereby agrees to each such sale and assignment.
Each Revolving Lender agrees to purchase its Pro Rata Share of an outstanding
Swing Line Advance on (i) the Business Day on which demand therefor is made by
the Swing Line Bank; provided that notice of such demand is given not later than
12:00 noon (New York City time) on such Business Day or (ii) the first Business
Day next succeeding such demand if notice of such demand is given after such
time. Upon any such assignment by the Swing Line Bank to any other Revolving
Lender of a portion of a Swing Line Advance, the Swing Line Bank represents and
warrants to such other Lender that the Swing Line Bank is the legal and
beneficial owner of such interest being assigned by it, but makes no other
representation or warranty and assumes no responsibility with respect to such
Swing Line Advance, the Financing Documents or the Borrower. If and to the
extent that any Revolving Lender shall not have so made the amount of such Swing
Line Advance available to the Administrative Agent, such Revolving Lender agrees
to pay to the Administrative Agent forthwith on demand such amount together with
interest thereon, for each day from the date of demand by the Swing Line Bank
until the date such amount is paid to the Administrative Agent, at the Federal
Funds Rate. If such Revolving Lender shall pay to the Administrative Agent such
amount for the account of the Swing Line Bank on any Business Day, such amount
so paid in respect of principal shall constitute a Swing Line Advance made by
such Revolving Lender on such Business Day for purposes of this Agreement, and
the outstanding principal amount of the Swing Line Advance made by the Swing
Line Bank shall be reduced by such amount on such Business Day.
(d) Each Notice of Borrowing and Notice of Swing Line Borrowing shall
be irrevocable and binding on the Borrower. In the case of any Borrowing that
the Borrower has specified in the related Notice of Borrowing is to be comprised
of Eurodollar Rate Advances, the Borrower shall indemnify each Appropriate
Lender against any loss, cost or expense incurred by such Lender as a result of
any failure to fulfill on or before the date specified in such Notice of
Borrowing for such Borrowing the applicable conditions set forth in Article III,
including any loss (including loss of anticipated profits), cost or expense
incurred by reason of the liquidation or redeployment of deposits or other funds
acquired by such Lender to fund the Advance to be made by such Lender as part of
such Borrowing when such Advance, as a result of such failure, is not made on
such date.
(e) Subject to the Administrative Agent giving prompt notice of the
relevant Notice of Borrowing received by the Administrative Agent to the Term
Lenders or the Revolving Lenders, as the case may be, unless the Administrative
Agent shall have received notice from an Appropriate Lender prior to the date of
the Borrowing requested under such Notice of Borrowing that such Lender will not
make available to the Administrative Agent such Lender's ratable portion of such
Borrowing, the Administrative Agent may assume that such Lender has made such
portion available to the Administrative Agent on the date of such Borrowing in
accordance with subsection (a) of this Section 2.02 and the Administrative Agent
may, in reliance upon such assumption, make available to the Borrower a
corresponding amount. If and to the extent that such Lender shall not have so
made such ratable portion available to the Administrative Agent, such Lender and
the Borrower severally agree to repay or pay to the Administrative Agent
forthwith on demand such corresponding amount and to pay interest thereon, for
each day from the date such amount is made available to the Borrower until the
date such amount is repaid or paid to the Administrative Agent, at (i) in the
case of the Borrower, the interest rate applicable at such time under Section
2.07 to Advances comprising such Borrowing and (ii) in the case of such Lender,
the Federal Funds Rate. If such Lender shall pay to the Administrative Agent
such corresponding amount, such amount so paid shall constitute such Lender's
Advance as part of such Borrowing for all purposes.
(f) The failure of any Lender to make the Advance to be made by it as
part of any Borrowing shall not relieve any other Lender of its obligation, if
any, hereunder to make its Advance on the date of such Borrowing, but no Lender
shall be responsible for the failure of any other Lender to make the Advance to
be made by such other Lender on the date of any Borrowing.
SECTION 2.03. Issuance of Letters of Credit; Drawings and
Reimbursements; Auto-Extension Letters of Credit; Funding of Participations. (a)
Procedures for Issuance and Amendment of Letters of Credit; Auto-Extension
Letters of Credit. (i) Each Letter of Credit shall be issued or amended, as the
case may be, upon the request of the Borrower delivered to an Issuing Bank (with
a copy to the Administrative Agent) in the form of a Letter of Credit
Application, appropriately completed and signed by a Responsible Officer of the
Borrower. Such Letter of Credit Application must be received by such Issuing
Bank and the Administrative Agent not later than 12:00 noon (New York City time)
at least one (1) Business Day (or such later date and time as the Administrative
Agent and the Issuing Bank may agree in a particular instance in their sole
discretion) prior to the proposed issuance date or date of amendment, as the
case may be. In the case of a request for an initial issuance of a Letter of
Credit, such Letter of Credit Application shall specify in form and detail
satisfactory to the respective Issuing Bank: (A) the proposed issuance date of
the requested Letter of Credit (which shall be a Business Day); (B) the amount
thereof; (C) the expiry date thereof (which date shall be not later than the
earlier of (1) the date which is twelve (12) months after the proposed issuance
date and (2) the Letter of Credit Expiration Date (or such later date as may be
agreed by the Revolving Lenders in accordance with Section 2.01(e)(i)); (D) the
name and address of the beneficiary thereof; (E) the documents to be presented
by such beneficiary in case of any drawing thereunder; (F) the full text of any
certificate to be presented by such beneficiary in case of any drawing
thereunder; and (G) such other matters as such Issuing Bank may require. In the
case of a request for an amendment of any outstanding Letter of Credit, such
Letter of Credit Application shall specify in form and detail satisfactory to
the respective Issuing Bank (w) the Letter of Credit to be amended; (x) the
proposed date of amendment thereof (which shall be a Business Day); (y) the
nature of the proposed amendment; and (z) such other matters as such Issuing
Bank may require. Additionally, the Borrower shall furnish to each Issuing Bank
and the Administrative Agent such other documents and information pertaining to
such requested Letter of Credit issuance or amendment, including any Issuer
Documents, as each such Issuing Bank or the Administrative Agent may require.
(ii) Promptly after receipt of any Letter of Credit Application, the
Issuing Bank will confirm with the Administrative Agent (by telephone or in
writing) that the Administrative Agent has received a copy of such Letter of
Credit Application from the Borrower and, if not, such Issuing Bank will provide
the Administrative Agent with a copy thereof. Unless such Issuing Bank has
received written notice from any Revolving Lender, the Administrative Agent or
the Borrower, at least one (1) Business Day prior to the requested date of
issuance or amendment of the applicable Letter of Credit, that one or more
applicable conditions contained in Article III shall not then be satisfied,
then, subject to the terms and conditions hereof, such Issuing Bank shall, on
the requested date, make an L/C Credit Extension for the account of the Borrower
or enter into the applicable amendment, as the case may be, in each case in
accordance with such Issuing Bank's usual and customary business practices.
Immediately upon the making of each L/C Credit Extension, each Revolving Lender
shall be deemed to, and hereby irrevocably and unconditionally agrees to,
purchase from such Issuing Bank a risk participation in such L/C Credit
Extension in an amount equal to the product of such Revolving Lender's Pro Rata
Share times the amount of such L/C Credit Extension.
(iii) If the Borrower so requests in any applicable Letter of Credit
Application, the Issuing Bank may, in its sole and absolute discretion, agree to
make an L/C Credit Extension that has automatic extension provisions (each, an
"Auto-Extension Letter of Credit"); provided that any such Auto-Extension Letter
of Credit must permit such Issuing Bank to prevent any such extension at least
once in each twelve-month period (commencing with the date of issuance of such
Letter of Credit) or upon notice to such Issuing Bank by the Administrative
Agent or the Borrower of an Insolvency Proceeding with respect to the Borrower
or any Material Subsidiary, by giving prior notice to the beneficiary thereof
not later than a day (the "Non-Extension Notice Date") in each such twelve-month
period to be agreed upon at the time such Letter of Credit is issued. Unless
otherwise directed by such Issuing Bank, the Borrower shall not be required to
make a specific request to such Issuing Bank for any such extension. Once an
Auto-Extension Letter of Credit has been issued, the Revolving Lenders shall be
deemed to have authorized (but may not require) such Issuing Bank to permit the
extension of such Letter of Credit at any time to an expiry date not later than
the Letter of Credit Expiration Date (or such later date as may be agreed by the
Revolving Lenders in accordance with Section 2.01(e)(i)); provided, however,
that such Issuing Bank shall not permit any such extension if (A) such Issuing
Bank has determined that it would not be permitted, or would have no obligation
at such time to issue such Letter of Credit in its revised form (as extended)
under the terms hereof (by reason of the provisions of Section 2.01(d), or
otherwise), or (B) it has received notice (which may be by telephone or in
writing) on or before the day that is five Business Days before the
Non-Extension Notice Date (1) from the Administrative Agent that the Required
Revolving Lenders have elected not to permit such extension or (2) from the
Administrative Agent or any Revolving Lender that one or more of the applicable
conditions specified in Section 3.02 is not then satisfied, and in each such
case directing such Issuing Bank not to permit such extension.
(iv) Promptly after its delivery of any Letter of Credit or any
amendment to a Letter of Credit to an advising bank with respect thereto or to
the beneficiary thereof, such Issuing Bank will also deliver to the Borrower and
the Administrative Agent a true and complete copy of such Letter of Credit or
amendment thereof.
(b) Drawings and Reimbursements; Funding of Participations. (i) Upon
receipt from the beneficiary of any Letter of Credit of any notice of a drawing
under such Letter of Credit, the Issuing Bank shall notify the Administrative
Agent and the Borrower thereof. Not later than 11:00 a.m. (New York City time)
on the date of any payment by such Issuing Bank under a Letter of Credit (each
such date, an "Honor Date"), the Borrower shall reimburse such Issuing Bank
through the Administrative Agent in an amount equal to the amount of such
drawing. If the Borrower fails to so reimburse such Issuing Bank by such time,
the Administrative Agent shall promptly notify each Revolving Lender of the
Honor Date, the amount of the unreimbursed drawing (the "Unreimbursed Amount"),
and the amount of such Revolving Lender's Pro Rata Share thereof. In such event,
the Borrower shall be deemed to have requested a Revolving Borrowing of Base
Rate Advances to be disbursed on the Honor Date in an amount equal to the
Unreimbursed Amount, without regard to the minimum and multiples specified in
Section 2.01 for the principal amount of Base Rate Advances, but subject to the
other conditions set forth in Section 2.01 and the conditions set forth in
Section 3.02 (other than the delivery of a Notice of Borrowing). Any notice
given by such Issuing Bank or the Administrative Agent pursuant to this Section
2.03(b) may be given by telephone if immediately confirmed in writing; provided
that the lack of such an immediate confirmation shall not affect the
conclusiveness or binding effect of such notice.
(ii) Each Revolving Lender (including the Revolving Lender acting as
Issuing Bank) shall upon any notice pursuant to Section 2.03(b)(i) make funds
available to the Administrative Agent for the account of such Issuing Bank at
the Administrative Agent's Account in an amount equal to its Pro Rata Share of
the Unreimbursed Amount not later than 1:00 p.m. (New York City time) on the
Business Day specified in such notice by the Administrative Agent, whereupon,
subject to the provisions of Section 2.03(b)(iii), each Revolving Lender that so
makes funds available shall be deemed to have made a Base Rate Advance to the
Borrower in such amount. The Administrative Agent shall remit the funds so
received to such Issuing Bank.
(iii) With respect to any Unreimbursed Amount that is not fully
refinanced by a Revolving Borrowing of Base Rate Advances because the conditions
set forth in Section 3.02 cannot be satisfied or for any other reason, the
Borrower shall be deemed to have incurred from the Issuing Bank an L/C Borrowing
in the amount of the Unreimbursed Amount that is not so refinanced, which L/C
Borrowing shall be due and payable on demand (together with interest) and shall
bear interest at a rate equal to the sum of (A) the Base Rate in effect from
time to time, plus (B) the Applicable Margin in effect from time to time, plus
(C) 2% per annum. In such event, each Revolving Lender's payment to the
Administrative Agent for the account of such Issuing Bank pursuant to Section
2.03(b)(ii) shall be deemed payment in respect of its participation in such L/C
Borrowing and shall constitute an L/C Advance from such Revolving Lender in
satisfaction of its participation obligation under this Section 2.03.
(iv) Until each Revolving Lender funds its Revolving Advance or L/C
Advance pursuant to this Section 2.03(b) to reimburse such Issuing Bank for any
amount drawn under any Letter of Credit, interest in respect of such Revolving
Lender's Pro Rata Share of such drawing shall be solely for the account of such
Issuing Bank.
(v) Each Revolving Lender's obligation to make Revolving Advances or
L/C Advances to reimburse any Issuing Bank for amounts drawn under Letters of
Credit, as contemplated by this Section 2.03(b), shall be absolute and
unconditional and shall not be affected by any circumstance, including (A) any
setoff, counterclaim, recoupment, defense or other right which such Revolving
Lender may have against the Issuing Bank, the Borrower or any other Person for
any reason whatsoever; (B) the occurrence or continuance of a Default, or (C)
any other occurrence, event or condition, whether or not similar to any of the
foregoing. No such making of an L/C Advance shall relieve or otherwise impair
the obligation of the Borrower to reimburse any Issuing Bank for the amount of
any payment made by the Issuing Bank under any Letter of Credit, together with
interest as provided herein.
(vi) If any Revolving Lender fails to make available to the
Administrative Agent for the account of any Issuing Bank any amount required to
be paid by such Revolving Lender pursuant to the foregoing provisions of this
Section 2.03(b) by the time specified in Section 2.03(b)(ii), such Issuing Bank
shall be entitled to recover from such Revolving Lender (acting through the
Administrative Agent), on demand, such amount with interest thereon for the
period from the date such payment is required to the date on which such payment
is immediately available to such Issuing Bank at a rate per annum equal to the
Federal Funds Rate from time to time in effect. A certificate of such Issuing
Bank submitted to any Revolving Lender (through the Administrative Agent) with
respect to any amounts owing under this Section 2.03(b)(vi) shall be conclusive
absent manifest error.
(c) Repayment of Participations. (i) At any time after an Issuing Bank
has made a payment under any Letter of Credit and has received from any
Revolving Lender such Revolving Lender's L/C Advance in respect of such payment
in accordance with Section 2.03(b), if the Administrative Agent receives for the
account of such Issuing Bank any payment in respect of the related Unreimbursed
Amount or interest thereon (whether directly from the Borrower or otherwise,
including proceeds of Cash Collateral applied thereto by the Administrative
Agent), the Administrative Agent will distribute to such Revolving Lender its
Pro Rata Share thereof (appropriately adjusted, in the case of interest
payments, to reflect the period of time during which such Revolving Lender's L/C
Advance was outstanding) in the same funds as those received by the
Administrative Agent.
(ii) If any payment received by the Administrative Agent for the
account of an Issuing Bank pursuant to Section 2.03(b)(i) is required to be
returned under any of the circumstances described in Section 2.12 (including
pursuant to any settlement entered into by such Issuing Bank in its discretion),
each Revolving Lender shall pay to the Administrative Agent for the account of
such Issuing Bank its Pro Rata Share thereof on demand of the Administrative
Agent, plus interest thereon from the date of such demand to the date such
amount is returned by such Revolving Lender, at a rate per annum equal to the
Federal Funds Rate from time to time in effect.
(d) Role of Issuing Bank. Each Revolving Lender and the Borrower agree
that, in paying any drawing under a Letter of Credit, each Issuing Bank shall
not have any responsibility to obtain any document (other than any sight draft,
certificates and documents expressly required by any Letter of Credit) or to
ascertain or inquire as to the validity or accuracy of any such document or the
authority of the Person executing or delivering any such document. None of the
Issuing Bank, the Administrative Agent nor any of the respective correspondents,
participants or assignees of such Issuing Bank shall be liable to any Revolving
Lender for (i) any action taken or omitted in connection herewith at the request
or with the approval of the Revolving Lenders or the Required Revolving Lenders,
as applicable; (ii) any action taken or omitted in the absence of gross
negligence or willful misconduct; or (iii) the due execution, effectiveness,
validity or enforceability of any document or instrument related to any Letter
of Credit or Letter of Credit Application. The Borrower hereby assumes all risks
of the acts or omissions of any beneficiary or transferee with respect to any
Letter of Credit; provided, however, that this assumption is not intended to,
and shall not, preclude the Borrower from pursuing such rights and remedies as
it may have against the beneficiary or transferee at law or under any other
agreement. None of the Issuing Bank, the Administrative Agent, nor any of the
respective correspondents, participants or assignees of such Issuing Bank shall
be liable or responsible for any of the matters described in clauses (i) through
(v) of Section 2.03(j); provided, however, that anything in such clauses to the
contrary notwithstanding, the Borrower may have a claim against an Issuing Bank,
and such Issuing Bank may be liable to the Borrower, to the extent, but only to
the extent, of any direct, as opposed to consequential or exemplary, damages
suffered by the Borrower which the Borrower proves were caused by such Issuing
Bank's willful misconduct or gross negligence or such Issuing Bank's willful
failure to pay under any Letter of Credit after the presentation to it by the
beneficiary of a sight draft and certificate(s) strictly complying with the
terms and conditions of a Letter of Credit. In furtherance and not in limitation
of the foregoing, an Issuing Bank may accept documents that appear on their face
to be in order, without responsibility for further investigation, regardless of
any notice or information to the contrary, and such Issuing Bank shall not be
responsible for the validity or sufficiency of any instrument transferring or
assigning or purporting to transfer or assign a Letter of Credit or the rights
or benefits thereunder or proceeds thereof, in whole or in part, which may prove
to be invalid or ineffective for any reason.
(e) Cash Collateral. Upon the occurrence and during the continuance of
any Event of Default, at the request of the Administrative Agent, (i) if an
Issuing Bank has honored any full or partial drawing request under any Letter of
Credit and such drawing has resulted in an L/C Borrowing, or (ii) if, as of the
Letter of Credit Expiration Date (or, if the expiry date of such Letter of
Credit is after the Letter of Credit Expiration Date (as may be agreed by the
Revolving Lenders in accordance with Section 2.01(e)(i)), as of such later
expiry date), any Letter of Credit for any reason remains outstanding and
partially or wholly undrawn, the Borrower shall immediately Cash Collateralize
the then Outstanding Amount of all L/C Obligations (in an amount equal to such
Outstanding Amount determined as of the date of such L/C Borrowing or the Letter
of Credit Expiration Date (or such later date as may be agreed by the Revolving
Lenders in accordance with Section 2.01(e)(i)), as the case may be). The
Borrower hereby grants to the Administrative Agent, for the benefit of each
Issuing Bank and the Revolving Lenders, a security interest in all such cash,
deposit accounts and all balances held in the Cash Collateral Account and all
proceeds of the foregoing. Upon the drawing of any Letter of Credit for which
funds are on deposit as Cash Collateral, such funds shall be applied, to the
extent permitted under Applicable Law, to reimburse each Issuing Bank.
(f) Applicability of ISP and UCP. Unless otherwise expressly agreed by
an Issuing Bank and the Borrower upon issuing an L/C Credit Extension, (i) the
rules of the ISP shall apply to each Standby Letter of Credit, and (ii) the
rules of the Uniform Customs and Practice for Documentary Credits, as most
recently published by the International Chamber of Commerce at the time of
issuance, shall apply to each Trade Letter of Credit.
(g) Conflict with Issuer Documents. In the event of any conflict
between the terms hereof and the terms of any Issuer Document, the terms hereof
shall control.
(h) Letters of Credit Issued for Subsidiaries. Notwithstanding that a
Letter of Credit issued or outstanding hereunder is in support of any
Obligations of, or is for the account of, a Subsidiary, the Borrower shall be
obligated to reimburse the Issuing Bank hereunder for any and all drawings under
such Letter of Credit. The Borrower hereby acknowledges that the L/C Credit
Extensions for the account of Subsidiaries inure to the benefit of the Borrower,
and that the Borrower's business derives substantial benefits from the
businesses of such Subsidiaries.
(i) Letter of Credit Reports. Each Issuing Bank shall furnish (A) to
the Administrative Agent on the first Business Day of each month a written
report summarizing issuance and expiration dates of L/C Credit Extensions issued
during the preceding month and drawings during such month under each Letter of
Credit and (B) to the Administrative Agent and each Revolving Lender on the
first Business Day of each calendar quarter a written report setting forth the
average daily aggregate L/C Obligations during the preceding calendar quarter of
all Letters of Credit.
(j) Obligations Absolute. The obligation of the Borrower to reimburse
each Issuing Bank for each drawing under each Letter of Credit and to repay each
L/C Borrowing shall be absolute, unconditional and irrevocable, and shall be
paid strictly in accordance with the terms of this Agreement under all
circumstances, including the following:
(i) any lack of validity or enforceability of such Letter of Credit,
this Agreement or any other Financing Document;
(ii) the existence of any claim, counterclaim, setoff, defense or
other right that the Borrower or any Subsidiary may have at any time
against any beneficiary or any transferee of such Letter of Credit (or any
Person for whom any such beneficiary or any such transferee may be acting),
such Issuing Bank or any other Person, whether in connection with this
Agreement, the transactions contemplated hereby or by such Letter of Credit
or any agreement or instrument relating thereto, or any unrelated
transaction;
(iii) any draft, demand, certificate or other document presented
under such Letter of Credit proving to be forged, fraudulent, invalid or
insufficient in any respect or any statement therein being untrue or
inaccurate in any respect; or any loss or delay in the transmission or
otherwise of any document required in order to make a drawing under such
Letter of Credit;
(iv) any payment by such Issuing Bank under such Letter of Credit
against presentation of a draft or certificate that does not strictly
comply with the terms of such Letter of Credit (so long as such draft or
certificate substantially complies with such terms); or any payment made by
such Issuing Bank under such Letter of Credit to any Person purporting to
be a trustee in bankruptcy, debtor-in-possession, assignee for the benefit
of creditors, liquidator, receiver or other representative of or successor
to any beneficiary or any transferee of such Letter of Credit; or
(v) any other circumstance or happening whatsoever, whether or not
similar to any of the foregoing, including any other circumstance that
might otherwise constitute a defense available to, or a discharge of, the
Borrower.
The Borrower shall promptly examine a copy of each Letter of Credit and
each amendment thereto that is delivered to it pursuant to Section 2.03(a)(iv)
and, in the event of any claim of noncompliance with the Borrower's instructions
or other irregularity, the Borrower will immediately notify the Issuing Bank.
The Borrower shall be conclusively deemed to have waived any such claim against
the Issuing Bank and its correspondents unless such notice is given as
aforesaid.
(k) Liability. The Borrower assumes all risks of the acts or omissions
of any beneficiary or transferee of any Letter of Credit with respect to its use
of such Letter of Credit. Neither any Issuing Bank, any of its Affiliates, nor
any of its respective officers, directors, agents, employees, attorneys and
advisors shall be liable or responsible for: (i) the use that may be made of any
Letter of Credit or any acts or omissions of any beneficiary or transferee in
connection therewith; (ii) the validity, sufficiency or genuineness of
documents, or of any endorsement thereon, even if such documents should prove to
be in any or all respects invalid, insufficient, fraudulent or forged; (iii)
payment by such Issuing Bank against presentation of documents that do not
comply with the terms of any Letter of Credit, including failure of any
documents to bear any reference or adequate reference to any Letter of Credit;
or (iv) any other circumstances whatsoever in making or failing to make payment
under any Letter of Credit, except that the Borrower shall have a claim against
such Issuing Bank, and such Issuing Bank shall be liable to the Borrower, to the
extent of any direct, but not consequential, damages suffered by the Borrower
that the Borrower proves were primarily caused by (A) such Issuing Bank's
willful misconduct or gross negligence as determined in a final, non-appealable
judgment by a court of competent jurisdiction in determining whether documents
presented under any Letter of Credit comply with the terms thereof or (B) such
Issuing Bank's willful failure to make lawful payment under any Letter of Credit
after the presentation to it of a draft and certificates strictly complying with
the terms and conditions of any Letter of Credit. In furtherance and not in
limitation of the foregoing, such Issuing Bank may accept documents that appear
on their face to be in order, without responsibility for further investigation,
regardless of any notice or information to the contrary.
SECTION 2.04. Repayment of Advances. The Borrower shall repay to the
Administrative Agent for the ratable account of the Lenders on the Final
Maturity Date the aggregate principal amount of all Advances which are then
outstanding. Without prejudice to the foregoing, the Borrower shall repay to the
Administrative Agent for the account of the Swing Line Bank and each other
Revolving Lender that has made a Swing Line Advance the outstanding principal
amount of each Swing Line Advance made by each of them on the earlier of the
maturity date specified in the applicable Notice of Swing Line Borrowing (which
maturity shall be no later than the seventh day after the requested date of such
Borrowing) and the Final Maturity Date.
SECTION 2.05. Termination or Reduction of the Commitments. (a)
Optional. The Borrower may, upon at least three Business Days' notice to the
Administrative Agent, terminate in whole or reduce in part the unused portion of
the Revolving Commitments and the Term Commitments; provided that (i) each
partial reduction of a Facility shall be in an aggregate amount of $2,000,000 or
an integral multiple of $1,000,000 in excess thereof and (ii) each partial
reduction of a Facility shall be made ratably among the Appropriate Lenders in
accordance with their respective Commitments with respect to such Facility.
(b) Mandatory. (i) The Term Facility shall be automatically and
permanently reduced on each date on which cancellation of Term Commitments is
required to be made pursuant to Section 2.06(b) by an amount equal to the
Reduction Amount (or portion thereof) applied to prepay Term Advances or reduce
Term Commitments, as applicable, pursuant to Section 2.06(b)(iii). In addition,
all unused Term Commitments shall terminate on the earliest to occur of (A) 5:00
p.m. (New York City time) on May 9, 2006, (B) the termination of the Term
Commitments pursuant to Section 2.05(a), or (C) the termination in full of the
Term Commitments in accordance with Section 6.01 (such date, the "Term
Commitment Termination Date").
(ii) The Revolving Commitments shall terminate on the earlier to occur
of (A) 5:00 p.m. (New York City time) on the Final Maturity Date, (B) the
termination in full of the Revolving Commitments pursuant to Section 2.05(a), or
(C) the termination of the Revolving Commitments in accordance with Section
6.01.
SECTION 2.06. Prepayments. (a) Optional. The Borrower may, upon at
least one Business Day's notice in the case of Base Rate Advances and three
Business Days' notice in the case of Eurodollar Rate Advances, in each case to
the Administrative Agent stating the proposed date and aggregate principal
amount of the prepayment, and if the notice is given the Borrower shall, prepay
the outstanding aggregate principal amount of the Advances comprising part of
the same Borrowing in whole or ratably in part, together with accrued interest
to the date of such prepayment on the aggregate principal amount prepaid;
provided that (i) each partial prepayment shall be in an aggregate principal
amount of $2,000,000 or an integral multiple of $1,000,000 in excess thereof and
(ii) if any prepayment of a Eurodollar Rate Advance is made on a date other than
the last day of an Interest Period for the Advance, the Borrower shall also pay
any amounts owing pursuant to Section 8.04(d).
(b) Mandatory. Prior to the Collateral Release Date, the Borrower shall
prepay the Advances at the following times and the following amounts:
(i) Within 10 Business Days after receipt by the Borrower or any of
its Subsidiaries of cash proceeds in respect of any Asset Sale, in an
aggregate principal amount equal to 50% of the Net Cash Proceeds received
by the Borrower or any of its Subsidiaries in connection with such Asset
Sale; provided that the foregoing shall not apply to Asset Sales, the
proceeds of which (1) are used, were used or are committed to be used by
the Borrower or any of its Subsidiaries for the financing of fixed or
capital assets to be used in the business of the Borrower and its
Subsidiaries or purchase of Emissions Credits, in each case, prior to or
within 12 months after any such Asset Sale or (2) individually or in the
aggregate for any Asset Sales in any Fiscal Year less than $20,000,000.
(ii) (A) Subject to clause (B) below, upon receipt of Recovery Event
Proceeds by the Borrower or the Material Subsidiaries in respect of any
Recovery Event or any series of related Recovery Events in excess of
$25,000,000, in an aggregate principal amount equal to such Recovery Event
Proceeds.
(B) Notwithstanding the foregoing, if the Borrower reasonably
believes, based on reasonable estimates of loss, that Recovery Event
Proceeds in respect of any Recovery Event or any series of related Recovery
Events will be in excess of $25,000,000, the Borrower may elect to restore
or replace the Asset (or portion thereof) affected by such Recovery Event
if the Borrower has delivered to the Administrative Agent, within 180 days
from the occurrence of such Recovery Event, each of the following: (1) (x)
a detailed breakdown of the nature and extent of such Recovery Event and
(y) a bona fide assessment of the estimated cost and time needed to restore
or replace the Asset (or relevant portion thereof) in order for such Asset
(or relevant portion thereof) to operate at substantially the same level as
prior to the Recovery Event; (2) satisfactory evidence that such Recovery
Event Proceeds, together with any cash proceeds that have been or are
expected to be paid to the Borrower or the Material Subsidiaries in respect
of such Recovery Event, and any other cash expected to be made available by
or on behalf of the Borrower or the Material Subsidiaries with respect to
whose Asset the Recovery Event occurred, are or are expected to be
sufficient to make the necessary restorations or replacements to such Asset
(or relevant portion thereof); and (3) an Officer's Certificate of the
Borrower certifying that (x) the Asset (other than any Excluded Asset)
subject to restoration/replacement will, if such restoration/replacement is
to occur prior to the Collateral Release Date, be subject to the Liens of
the Collateral Documents (whether by amendment to the Collateral Documents
or otherwise); (y) all material Governmental Approvals necessary to perform
the work necessary to restore or replace the Asset (or relevant portion
thereof) affected by the relevant Recovery Event (or series of related
Recovery Events) have been obtained (or are reasonably expected to be
obtained without undue delay or as needed); and (z) the Asset (or relevant
portion thereof) once repaired/restored will be of similar value and
general utility as immediately prior to the loss; provided that, if the
Borrower does not deliver the information and Officer's Certificate set
forth in this clause (B) within such 180-day period, the Borrower shall, as
soon as reasonably practicable after such 180-day period, prepay the
Advances in an aggregate principal amount equal to such Recovery Event
Proceeds in accordance with clause (A) above; and
(C) Upon completion of the restoration and replacement in respect of
any Asset (or the relevant portion thereof) with respect to which the
Borrower delivered the information and Officer's Certificate set forth in
clause (B)(3) above, if (1) either (x) such restoration and replacement is
completed before the Collateral Release Date or (y) the Borrower did not
diligently pursue such restoration and replacement and such restoration and
replacement is completed after the Collateral Release Date, and (2) the
Recovery Event Proceeds in respect of the relevant Recovery Event (or
series of related Recovery Events) exceed the cost of such restoration and
replacement by more than $1,000,000, in an aggregate principal amount equal
to such amount over $1,000,000; it being understood that the Borrower shall
not be required to use any Recovery Event Proceeds in respect of a Recovery
Event or series of related Recovery Events, which it believes, based on
reasonable estimates of loss, will be $25,000,000 or less in the aggregate,
to pay or as reimbursement for the costs of the necessary repairs to or
replacement of Assets affected by the relevant Recovery Event pursuant to
clause (B) above and this clause (C).
(iii) Prepayments pursuant to this Section 2.06(b) shall be applied,
first, to repay Term Advances outstanding at such time until all such Term
Advances are paid in full or, if the Net Cash Proceeds arising from such
sale, transfer or other disposition of Assets occurs prior to the Initial
Borrowing, to permanently reduce the Term Commitments, second, to repay
Swing Line Advances and L/C Borrowings outstanding at such time, pro rata,
until all such Swing Line Advances and L/C Borrowings are paid in full,
third, to repay Revolving Advances outstanding at such time until all such
Revolving Advances are paid in full, and fourth, to Cash Collateralize the
L/C Obligations (the sum of such prepayment amounts, cancellation of Term
Commitments and Cash Collateralization amounts being the "Reduction
Amount").
(c) Other Amounts. Concurrently with any prepayment of Advances under
this Section 2.06, the Borrower shall pay to the applicable Lender or Issuing
Bank all accrued fees, costs and expenses, accrued interest thereon, if any, and
any other amounts due under the Financing Documents in respect of the principal
amount of the Advances or L/C Borrowings so prepaid, including pursuant to
Section 8.04(e).
SECTION 2.07. Interest. (a) Scheduled Interest. The Borrower shall pay
interest on the unpaid principal amount of each Advance owing to each Lender
from the date of such Advance until such principal amount shall be paid in full,
at the following rates per annum:
(i) Base Rate Advances. During such periods as such Advance is a
Base Rate Advance, a rate per annum equal at all times to the sum of (A)
the Base Rate in effect from time to time plus (B) the Applicable Margin in
effect from time to time, payable in arrears each Quarterly Date during
such periods and on the date such Base Rate Advance shall be Converted or
paid in full.
(ii) Eurodollar Rate Advances. During such periods as such Advance
is a Eurodollar Rate Advance, a rate per annum equal at all times during
each Interest Period for such Advance to the sum of (A) the Eurodollar Rate
for such Interest Period for such Advance plus (B) the Applicable Margin in
effect from time to time, payable in arrears on the last day of such
Interest Period and, if such Interest Period has a duration of more than
three months, on each day that occurs during such Interest Period every
three months from the date of such Interest Period and on the date such
Eurodollar Rate Advance shall be Converted or paid in full.
(b) Default Interest. Upon the occurrence and during the continuance of
an Event of Default, the Borrower shall pay interest on (i) the unpaid and
overdue principal amount of each Advance owing to each Lender, payable in
arrears on the dates referred to in clause (a)(i) or (a)(ii) above and on
demand, at a rate per annum equal at all times to 2% per annum above the rate
per annum required to be paid on such Advance pursuant to clause (a)(i) or
(a)(ii) above and (ii) to the fullest extent permitted by Applicable Law, the
amount of any interest, fee or other amount payable by the Borrower hereunder
that is not paid when due, from the date such amount shall be due until such
amount shall be paid in full, payable in arrears on the date such amount shall
be paid in full and on demand, at a rate per annum equal at all times to 2% per
annum above the rate per annum required to be paid, in the case of interest, on
the Type of Advance on which such interest has accrued pursuant to clause (a)(i)
or (a)(ii) above and, in all other cases, on Base Rate Advances pursuant to
clause (a)(i) above.
(c) Notice of Interest Period and Interest Rate. Promptly after receipt
of a Notice of Borrowing pursuant to Section 2.02(a), a Notice of
Conversion/Continuation pursuant to Section 2.11(a)(ii) or a notice of selection
of an Interest Period pursuant to the terms of the definition of "Interest
Period", in each case from the Borrower, the Administrative Agent shall give
notice to the Borrower and each Appropriate Lender of the applicable Interest
Period and the applicable interest rate determined by the Administrative Agent
for purposes of clause (a)(i) or (a)(ii) above.
SECTION 2.08. Fees. (a) Commitment Fee. The Borrower shall pay to the
Administrative Agent for the account of the Revolving Lenders a commitment fee
from the date hereof in the case of each Initial Lender holding a Revolving
Commitment and from the effective date specified in the Assignment and
Acceptance pursuant to which it became a Revolving Lender in the case of each
other Revolving Lender until the Final Maturity Date, commencing on the Closing
Date, and payable quarterly in arrears on the first Business Day after the end
of each Quarterly Date and on the Final Maturity Date, at the Commitment Fee
Rate on the sum of (i) the average daily Unused Commitment of such Revolving
Lender during such fiscal quarter plus (ii) its Pro Rata Share of the average
daily outstanding Swing Line Advances made by the Swing Line Bank during such
fiscal quarter.
(b) Letter of Credit Fees. The Borrower shall pay to the Administrative
Agent for the account of each Revolving Lender in accordance with its Pro Rata
Share a Letter of Credit fee (the "Letter of Credit Fee") for each Letter of
Credit equal to the Applicable Margin for Eurodollar Rate Advances in effect
from time to time multiplied by the daily maximum amount available to be drawn
under such Letter of Credit (whether or not such maximum amount is then in
effect under such Letter of Credit). Letter of Credit Fees shall be (i) computed
on a quarterly basis in arrears and (ii) due and payable on the first Business
Day after the end of each Quarterly Date, commencing with the first such date to
occur after the issuance of such Letter of Credit, on the Letter of Credit
Expiration Date and thereafter on demand. Notwithstanding anything to the
contrary contained herein, upon the request of the Required Revolving Lenders,
while any payment-related Default exists, all Letter of Credit Fees shall accrue
at the Applicable Margin for Eurodollar Rate Advances plus 2%.
(c) Fronting Fee and Documentary and Processing Charges Payable to
Issuing Banks, Etc. The Borrower shall pay directly to the relevant Issuing Bank
for its own account a fronting fee with respect to each Letter of Credit issued
hereunder in the amount equal to 0.10% of the L/C Obligations (whether or not
such maximum amount is then in effect under such Letter of Credit) (the
"Fronting Fee"). The Fronting Fee shall be computed on a quarterly basis in
arrears and shall be due and payable on each Quarterly Date, commencing with the
first such date to occur after the issuance of such Letter of Credit, on the
Letter of Credit Expiration Date and thereafter on demand. In addition, the
Borrower shall, with respect to all Letters of Credit issued at its request, pay
directly to each Issuing Bank for its own account the customary issuance,
presentation, amendment and other processing fees, and other standard costs and
charges, of such Issuing Bank relating to letters of credit as from time to time
in effect. Such customary fees and standard costs and charges are due and
payable on demand and are nonrefundable.
(d) Agents' Fees. The Borrower shall pay to each Agent for its own
account such fees as may from time to time be agreed between the Borrower and
such Agent.
SECTION 2.09. Payments Generally; Pro Rata Treatment. (a) The Borrower
shall make each payment hereunder, under the Notes and under any Financing
Document owing to any Lender Party, in full, and without condition or deduction
for any counterclaim, defense, recoupment or setoff, not later than 12:00 noon
(New York City time) on the day when due in Dollars to the Administrative Agent
at the Administrative Agent's Account in immediately available funds, with
payments being received by the Administrative Agent after such time being deemed
to have been received on the next succeeding Business Day. The Administrative
Agent will promptly thereafter cause like funds to be distributed (i) if the
payment by (or for the account of) the Borrower is in respect of principal,
interest, commitment fees or any other Obligation then payable hereunder and
under the Notes to more than one Lender Party, to such Lender Parties for the
account of their respective Applicable Lending Offices ratably in accordance
with the amounts of such respective Obligations then payable to such Lender
Parties and (ii) if such payment is in respect of any Obligation then payable
hereunder to one Lender Party, to such Lender Party for the account of its
Applicable Lending Office, in each case to be applied in accordance with the
terms of this Agreement. Upon its acceptance of an Assignment and Acceptance and
recording of the information contained therein in the Register pursuant to
Section 8.07(e), from and after the effective date of such Assignment and
Acceptance, the Administrative Agent shall make all payments hereunder and under
the Notes in respect of the interest assigned thereby to the Lender Party
assignee thereunder, and the parties to such Assignment and Acceptance shall
make all appropriate adjustments in such payments for periods prior to such
effective date directly between themselves.
(b) All payments under this Agreement and the other Financing Documents
to any Agent (whether for its own account or for the account of any Lender Party
shall be made to such Agent.
(c) The Borrower hereby authorizes each Lender Party and each of its
Affiliates, if and to the extent payment owed to such Lender Party by the
Borrower is not made when due hereunder or, in the case of a Lender, under its
Note or Notes, to charge from time to time, to the fullest extent permitted by
law, against any or all of the Borrower's accounts (other than any Pledged
Account or the Controlled Accounts) with such Lender Party or such Affiliate any
amount so due.
(d) All computations of interest based on the Base Rate or the Federal
Funds Rate shall be made by the Administrative Agent on the basis of a year of
365 or 366 days, as the case may be, and all computations of interest based on
the Eurodollar Rate and of fees shall be made by the Administrative Agent on the
basis of a year of 360 days, in each case for the actual number of days
(including the first day but excluding the last day) occurring in the period for
which such interest, fees or commissions are payable. Each determination by the
Administrative Agent of an interest rate, fee or commission hereunder shall be
conclusive and binding for all purposes, absent manifest error.
(e) Whenever any payment hereunder or under the Notes shall be stated
to be due on a day other than a Business Day, such payment shall be made on the
next succeeding Business Day, and such extension of time shall in such case be
included in the computation of payment of interest or commitment fee, as the
case may be; provided that, if such extension would cause payment of interest on
or principal of Eurodollar Rate Advances to be made in the next following
calendar month, such payment shall be made on the next preceding Business Day.
(f) Unless the Administrative Agent shall have received notice from the
Borrower prior to the date on which any payment is due to any Lender Party
hereunder that the Borrower will not make such payment in full, the
Administrative Agent may assume that the Borrower has made such payment in full
to the Administrative Agent on such date and the Administrative Agent may, in
reliance upon such assumption, cause to be distributed to each such Lender Party
on such due date an amount equal to the amount then due such Lender Party. If
and to the extent the Borrower shall not have so made such payment in full to
the Administrative Agent, each such Lender Party shall repay to the
Administrative Agent forthwith on demand such amount distributed to such Lender
Party together with interest thereon, for each day from the date such amount is
distributed to such Lender Party until the date such Lender Party repays such
amount to the Administrative Agent, at the Federal Funds Rate.
(g) If the Administrative Agent receives funds for application to the
Obligations under the Financing Documents under circumstances for which the
Financing Documents do not specify the Advances or the Facility to which, or the
manner in which, such funds are to be applied, the Administrative Agent may, but
shall not be obligated to, elect to distribute such funds to each Lender Party
ratably in accordance with such Lender Party's proportionate share of the
principal amount of all outstanding Advances and the L/C Obligations then
outstanding, in repayment or prepayment of such of the outstanding Advances or
other Obligations owed to such Lender Party, and for application to such
principal installments, as the Administrative Agent shall direct; provided that
the Borrower shall not be liable to any Lender Party with respect to any such
distribution by the Administrative Agent.
(h) If any Lender Party shall obtain any payment (whether voluntary,
involuntary, through the exercise of any right of set-off, or otherwise), other
than pursuant to Section 2.10, 2.12 or 2.13, as a result of an assignment
pursuant to Section 8.07 or as a result of the payment of an Amendment Fee which
has been offered to or is available to all Lender Parties on the same terms, (a)
on account of Obligations due and payable to such Lender Party hereunder and
under the Notes at such time in excess of its ratable share (according to the
proportion of (i) the amount of such Obligations due and payable to such Lender
Party at such time to (ii) the aggregate amount of the Obligations due and
payable to all Lender Parties hereunder and under the Notes at such time) of
payments on account of the Obligations due and payable to all Lender Parties
hereunder and under the Notes at such time obtained by all the Lender Parties at
such time or (b) on account of Obligations owing (but not due and payable) to
such Lender Party hereunder and under the Notes at such time in excess of its
ratable share (according to the proportion of (i) the amount of such Obligations
owing to such Lender Party at such time to (ii) the aggregate amount of the
Obligations owing (but not due and payable) to all Lender Parties hereunder and
under the Notes at such time) of payments on account of the Obligations owing
(but not due and payable) to all Lender Parties hereunder and under the Notes at
such time obtained by all of the Lender Parties at such time, such Lender Party
shall forthwith purchase from the other Lender Parties such interests or
participating interests in the Obligations due and payable or owing to them, as
the case may be, as shall be necessary to cause such purchasing Lender Party to
share the excess payment ratably with each of them; provided that if all or any
portion of such excess payment is thereafter recovered from such purchasing
Lender Party, such purchase from each other Lender Party shall be rescinded and
such other Lender Party shall repay to the purchasing Lender Party the purchase
price to the extent of such Lender Party's ratable share (according to the
proportion of (i) the purchase price paid to such Lender Party to (ii) the
aggregate purchase price paid to all Lender Parties) of such recovery together
with an amount equal to such Lender Party's ratable share (according to the
proportion of (i) the amount of such other Lender Party's required repayment to
(ii) the total amount so recovered from the purchasing Lender Party) of any
interest or other amount paid or payable by the purchasing Lender Party in
respect of the total amount so recovered. The Borrower agrees that any Lender
Party so purchasing an interest or participating interest from another Lender
Party pursuant to this Section 2.09 may, to the fullest extent permitted by
Applicable Law, exercise all its rights of payment (including the right of
set-off) with respect to such interest or participating interest, as the case
may be, as fully as if such Lender Party were the direct creditor of the
Borrower in the amount of such interest or participating interest, as the case
may be.
SECTION 2.10. Illegality. Notwithstanding any other provision of this
Agreement, if the introduction of or any change in or in the interpretation of
any law or regulation shall make it unlawful, or any central bank or other
Governmental Authority shall assert that it is unlawful, for any Lender or its
Eurodollar Lending Office to perform its obligations hereunder to make
Eurodollar Rate Advances or to continue to fund or maintain Eurodollar Rate
Advances hereunder, then, on notice thereof and demand therefor by such Lender
to the Borrower through the Administrative Agent, (i) each Eurodollar Rate
Advance will automatically, upon such demand, Convert into a Base Rate Advance
and (ii) the obligation of such Lender to make, or to Convert Advances into,
Eurodollar Rate Advances shall be suspended until the Administrative Agent shall
notify the Borrower that such Lender has determined that the circumstances
causing such suspension no longer exist; provided that, before making any such
demand, such Lender agrees to use reasonable efforts (consistent with its
internal policy and legal and regulatory restrictions) to designate a different
Eurodollar Lending Office if the making of such a designation would allow such
Lender or its Eurodollar Lending Office to continue to perform its obligations
to make Eurodollar Rate Advances or to continue to fund or maintain Eurodollar
Rate Advances and would not, in the judgment of such Lender, be otherwise
disadvantageous to such Lender.
SECTION 2.11. Interest Elections. (a) Optional. (i) The Borrower may on
any Business Day elect to Convert all or any portion of the Advances comprising
the same Borrowing (other than a Swing Line Borrowing) from one Type into
Advances of the other Type, and in the case of Eurodollar Rate Advances, may
elect Interest Periods therefor, all as provided in this Section 2.11. The
Borrower may elect different options with respect to different portions of any
Borrowing (other than a Swing Line Borrowing), in which case each such portion
shall be allocated ratably among the Appropriate Lenders in accordance with
their Commitments. At no time shall the total number of different Interest
Periods for all Eurodollar Rate Advances outstanding exceed ten.
(ii) To make an election pursuant to this Section 2.11(a), the Borrower
shall give the Administrative Agent prior written notice (or telephonic notice
promptly confirmed in writing) by telecopier or electronic mail (a "Notice of
Conversion/Continuation") of the Conversion or Continuation, as the case may be,
(i) by 1:00 p.m. (New York City time) on the requested date of a Conversion into
Base Rate Advances and (ii) by 12:00 noon (New York City time) three Business
Days prior to a Continuation of or Conversion into Eurodollar Rate Advances;
provided, however, that any Conversion of Eurodollar Rate Advances into Base
Rate Advances shall be made only on the last day of an Interest Period for such
Eurodollar Rate Advances, any Conversion of Base Rate Advances into Eurodollar
Rate Advances shall be in an amount not less than the minimum amount specified
in Section 2.02(b), no Conversion of any Advances shall result in more separate
Borrowings than permitted under Section 2.02(b) and each Conversion of Advances
comprising part of the same Borrowing shall be made ratably among the
Appropriate Lenders in accordance with their Commitments. Each such Notice of
Conversion/Continuation shall be irrevocable and shall specify (A) if different
options are being elected with respect to different portions of the relevant
Borrowing, the portions thereof that are to be allocated to each resulting
election (in which case the information to be specified pursuant to clauses (C)
and (D) shall be specified for each resulting portion); (B) the effective date
of the election made pursuant to such Notice of Conversion/Continuation, which
shall be a Business Day; (C) whether the resulting Borrowings are to be
comprised of Base Rate Advances or Eurodollar Rate Advances; and (D) if the
resulting Borrowings are to be comprised of Eurodollar Rate Advances, the
Interest Period applicable thereto after giving effect to such election, which
shall be a period contemplated by the definition of "Interest Period". If any
such Notice of Conversion/Continuation requests that the relevant Borrowing be
comprised of Eurodollar Rate Advances but does not specify an Interest Period,
the Borrower shall be deemed to have selected an Interest Period of one month.
Each Notice of Conversion/Continuation shall be irrevocable and binding on the
Borrower.
(iii) If, on the expiration of any Interest Period in respect of any
Eurodollar Rate Advances, the Borrower shall have failed to deliver a Notice of
Conversion/Continuation, then, unless such Advances are repaid as provided
herein, the Borrower shall be deemed to have elected to Convert such Advances to
Base Rate Advances. No Advances may be Converted into, or Continued as,
Eurodollar Rate Advances if an Event of Default has occurred and is continuing,
unless the Administrative Agent and the Required Lenders shall have otherwise
consented in writing.
(iv) Upon receipt of any Notice of Conversion/Continuation, the
Administrative Agent shall promptly notify each Appropriate Lender of the
details thereof and of such Lender's ratable share of each election.
(b) Mandatory. (i) On the date on which the aggregate unpaid principal
amount of Eurodollar Rate Advances comprising any Borrowing shall be reduced, by
payment or prepayment or otherwise, to less than $2,000,000, such Advances shall
automatically Convert into Base Rate Advances.
(ii) If the Borrower shall fail to select the duration of any Interest
Period for any Eurodollar Rate Advances to be made to it in accordance with the
provisions contained in the definition of "Interest Period" in Section 1.01, the
Administrative Agent shall forthwith so notify the Borrower and the Lenders,
whereupon each such Eurodollar Rate Advance shall automatically, on the last day
of the then existing Interest Period therefor, Convert into a Base Rate Advance.
(iii) Upon the occurrence and during the continuance of any Event of
Default, (A) each Eurodollar Rate Advance will automatically, on the last day of
the then existing Interest Period therefor, Convert into a Base Rate Advance and
(B) the obligation of the Lenders to make, or to Convert Advances into,
Eurodollar Rate Advances shall be suspended.
SECTION 2.12. Increased Costs, Etc. (a) If, due to either (i) the
introduction of or any change (other than any change by way of imposition or
increase of reserve requirements included in the Eurodollar Rate Reserve
Percentage) in or in the interpretation of any law or regulation or (ii) the
compliance with any guideline or request from any central bank or other
Governmental Authority (whether or not having the force of law), there shall be
any increase in the cost to any Lender Party of agreeing to make or of making,
funding or maintaining Eurodollar Rate Advances or of agreeing to maintain or
participate in the L/C Credit Extensions or of agreeing to make or of making or
funding or maintaining L/C Credit Extensions (excluding, for purposes of this
Section 2.12, any such increased costs resulting from (A) Taxes or Other Taxes
(as to which Section 2.13 shall govern) and (B) changes in the basis of taxation
of overall net income or overall gross income by the United States or by the
foreign jurisdiction or state under the laws of which such Lender Party is
organized or has its Applicable Lending Office or any political subdivision
thereof), then the Borrower shall from time to time, upon demand by such Lender
Party (with a copy of such demand to the Administrative Agent), pay to the
Administrative Agent for the account of such Lender Party additional amounts
sufficient to compensate such Lender Party for such increased cost; provided,
however, that a Lender Party claiming additional amounts under this Section
2.12(a) agrees to use reasonable efforts (consistent with its internal policy
and legal and regulatory restrictions) to designate a different Applicable
Lending Office if the making of such a designation would avoid the need for, or
reduce the amount of, such increased cost that may thereafter accrue and would
not, in the reasonable judgment of such Lender Party, be otherwise
disadvantageous to such Lender Party. A certificate as to the amount of such
increased cost, submitted to the Borrower by such Lender Party, shall be
conclusive and binding for all purposes, absent manifest error.
(b) If any Lender Party determines that compliance with any law or
regulation or any guideline or request from any central bank or other
Governmental Authority (whether or not having the force of law) affects or would
affect the amount of capital required or expected to be maintained by such
Lender Party or any corporation controlling such Lender Party and that the
amount of such capital is increased by or based upon the existence of such
Lender Party's commitment to lend or to participate in the making of L/C Credit
Extensions hereunder and other commitments of such type or the maintenance of or
participation in the L/C Credit Extensions (or similar contingent obligations),
then, upon demand by such Lender Party or such corporation (with a copy of such
demand to the Administrative Agent), the Borrower shall pay to the
Administrative Agent for the account of such Lender Party, from time to time as
specified by such Lender Party, additional amounts sufficient to compensate such
Lender Party in the light of such circumstances, to the extent that such Lender
Party reasonably determines such increase in capital to be allocable to the
existence of such Lender Party's commitment to lend or to participate in the L/C
Credit Extensions or to the issuance or maintenance of or participation in L/C
Credit Extensions. A certificate as to such amounts submitted to the Borrower by
such Lender Party shall be conclusive and binding for all purposes, absent
manifest error.
(c) If, with respect to any Eurodollar Rate Advances, the Required
Lenders notify the Administrative Agent that the Eurodollar Rate for any
Interest Period for such Advances will not adequately reflect the cost to such
Lenders of making, funding or maintaining their Eurodollar Rate Advances for
such Interest Period, the Administrative Agent shall forthwith so notify the
Borrower and the Lenders, whereupon (i) each such Eurodollar Rate Advance will
automatically, on the last day of the then existing Interest Period therefor,
Convert into a Base Rate Advance and (ii) the obligation of the Lenders to make,
or to Convert Advances into, Eurodollar Rate Advances shall be suspended until
the Administrative Agent shall notify the Borrower that such Required Lenders
have determined that the circumstances causing such suspension no longer exist.
SECTION 2.13. Taxes. (a) Any and all payments by the Borrower hereunder
or under the Notes shall be made, in accordance with Section 2.09, free and
clear of and without deduction for any and all present or future withholding
taxes, including levies, imposts, deductions, charges or withholdings, and all
liabilities with respect thereto, excluding, in the case of each Lender Party
and the Administrative Agent, (i) taxes imposed on (or measured by) its overall
net income, or any franchise taxes or similar taxes imposed for the privilege of
carrying on a business in corporate form (other than taxes imposed as a result
of entering into this Agreement or any other Financing Document and the
transactions contemplated hereby or thereby), or taxes measured by its net worth
or shareholder's capital, by the United States, or by the jurisdiction under the
laws of which such recipient is organized or in which its Applicable Lending
Office is located, (ii) any branch profits taxes imposed by the United States or
any similar tax imposed by any other jurisdiction in which the Applicable
Lending Office of any Lender Party is located and (iii) withholding taxes
excluded pursuant to clause (e) of this Section 2.13 (all such non-excluded
taxes, including levies, imposts, deductions, charges, withholdings and
liabilities in respect of payments hereunder or under the Notes being
hereinafter referred to as "Covered Taxes"). If the Borrower shall be required
by law to deduct any Covered Taxes from or in respect of any sum payable
hereunder or under any Note to any Lender Party or the Administrative Agent, (A)
the sum payable by the Borrower shall be increased as may be necessary so that
after the Borrower and the Administrative Agent have made all required
deductions (including deductions applicable to additional sums payable under
this Section 2.13) such Lender Party or the Administrative Agent, as the case
may be, receives an amount equal to the sum it would have received had no such
deductions been made, (B) the Borrower shall make all such deductions and (C)
the Borrower shall pay the full amount deducted to the relevant taxation
authority or other authority in accordance with Applicable Law.
(b) In addition, the Borrower shall pay any present or future stamp,
documentary, excise, property, intangible, mortgage recording or similar taxes,
charges or levies that arise from any payment made hereunder or under the Notes
or from the execution, delivery or registration of, performance under, or
otherwise with respect to, this Agreement or any other Financing Document, but
excluding all other U.S. federal taxes other than withholding taxes (hereinafter
referred to as "Other Taxes"). If revised disclosure regulations under Section
6011 of the Code are issued which modify the definition of a "reportable
transaction" so that it does not include a transaction where the issuer of a
debt instrument provides an indemnity for taxes, in addition to withholding
taxes imposed on interest paid on the debt instrument, for purposes of
subsections (a) and (b) of this Section 2.13, the terms "Covered Taxes" and
"Other Taxes" shall include all such taxes (other than any taxes described in
clauses (i), (ii) and (iii) of Section 2.13(a) above), whether or not collected
by way of withholding.
(c) The Borrower shall indemnify each Lender Party and the
Administrative Agent for and hold them harmless against the full amount of
Covered Taxes and Other Taxes, and for the full amount of taxes of any kind
imposed by any jurisdiction on amounts payable under this Section 2.13, imposed
on or paid by such Lender Party or the Administrative Agent (as the case may be)
and any liability (including penalties, additions to tax, interest and
reasonable expenses) arising therefrom or with respect thereto. This
indemnification shall be made within 30 days from the date such Lender Party or
the Administrative Agent (as the case may be) makes written demand therefor.
(d) As soon as practicable (but in no event later than 90 days) after
the date of any payment of Covered Taxes, the Borrower shall furnish to the
Administrative Agent, at its address referred to in Section 8.02, the original
or a certified copy of a receipt evidencing such payment. Excluding payments
made by the Administrative Agent, in the case of any payment hereunder or under
the Notes by or on behalf of the Borrower through an account or branch outside
the United States or by or on behalf of the Borrower by a payor that is not a
United States person, if the Borrower determines that no Covered Taxes are
payable in respect thereof, the Borrower shall furnish, or shall cause such
payor to furnish, to the Administrative Agent, at such address, an opinion of
counsel acceptable to the Administrative Agent stating that such payment is
exempt from Covered Taxes. For purposes of subsections (d) and (e) of this
Section 2.13, the terms "United States" and "United States person" shall have
the meanings specified in Section 7701 of the Code.
(e) Each Lender Party organized under the laws of a jurisdiction
outside the United States shall, on or prior to the date of its execution and
delivery of this Agreement in the case of each Initial Lender Party and on the
date of the Assignment and Acceptance pursuant to which it becomes a Lender
Party in the case of each other Lender Party, and from time to time thereafter
as requested in writing by the Borrower (but only so long thereafter as such
Lender Party remains lawfully able to do so), provide each of the Administrative
Agent and the Borrower with two duly completed copies of (i) Internal Revenue
Service Form W-8ECI, or any successor form thereto, certifying that the payments
received from the Borrower hereunder are effectively connected with such Lender
Party's conduct of a trade or business in the United States; or (ii) Internal
Revenue Service Form W-8BEN, or any successor form thereto, certifying that such
Lender Party is entitled to benefits under an income tax treaty to which the
United States is a party which reduces the rate of withholding tax on payments
of interest; or (iii) Internal Revenue Service Form W-8BEN or any successor form
thereto, together with a certificate stating that (1) the Lender Party is not a
bank for purposes of Code Section 881(c)(3)(A), or the obligation of the
Borrower hereunder is not, with respect to such Lender Party, pursuant to a loan
agreement entered into in the ordinary course of its trade or business, within
the meaning of that Section; (2) the Lender Party is not a 10% shareholder of
the Borrower within the meaning of Code Section 871(h)(3) or 881(c)(3)(B); and
(3) the Lender Party is not a controlled foreign corporation that is related to
the Borrower within the meaning of Code Section 881(c)(3)(C); or (iv) such other
governmental forms as may be applicable to the Lender Party, including Forms
W-8IMY or W-8EXP, which will reduce the rate of withholding tax on payments of
interest. Each Lender Party organized under the laws of the United States that
is not a corporation shall, on or prior to the date of its execution and
delivery of this Agreement in the case of each Initial Lender Party and on the
date of the Assignment and Acceptance pursuant to which it becomes a Lender
Party in the case of each other Lender Party, and from time to time as requested
in writing by the Borrower, provide each of the Administrative Agent and the
Borrower with two duly completed copies of Internal Revenue Service Form W-9.
Each Lender Party shall deliver such forms promptly upon the obsolescence or
invalidity of any form previously delivered by such Lender Party (but only to
the extent such Lender Party is lawfully able to do so). Each such Lender Party
shall promptly notify the Borrower at any time that it determines that it is no
longer in a position to provide any previously delivered certificate to the
Borrower (or any other form of certification adopted by the Internal Revenue
Service for such purpose). If the forms provided by a Lender Party at the time
such Lender Party first becomes a party to this Agreement indicate a United
States interest withholding tax rate in excess of zero, withholding tax at such
rate shall be considered excluded from Covered Taxes unless and until such
Lender Party provides the appropriate forms certifying that a lesser rate
applies, whereupon withholding tax at such lesser rate only shall be considered
excluded from Covered Taxes for periods governed by such forms; provided,
however, that if, at the effective date of the Assignment and Acceptance
pursuant to which a Lender Party becomes a party to this Agreement, the Lender
Party assignor was entitled to payments under subsection (a) of this Section
2.13 in respect of United States withholding tax with respect to interest paid
at such date, then, to such extent, the term "Covered Taxes" shall include (in
addition to withholding taxes that may be imposed in the future or other amounts
otherwise includable in Covered Taxes) United States withholding tax, if any,
applicable with respect to the Lender Party assignee on such date. If any form
or document referred to in this subsection (e) requires the disclosure of
information, other than information necessary to compute the tax payable and
information required by the applicable Internal Revenue Service form (or related
certificate described above), that the applicable Lender Party reasonably
considers to be confidential, such Lender Party shall give notice thereof to the
Borrower and shall not be obligated to include in such form or document such
confidential information.
(f) Notwithstanding the foregoing, for any period with respect to which
a Lender Party has failed to provide the Borrower with the appropriate form
described in subsection (e) above (other than if such failure is due to a change
in law occurring after the date on which a form originally was required to be
provided or if such form otherwise is not required under subsection (e) above),
such Lender Party shall not be entitled to indemnification under subsection (a)
or (c) of this Section 2.13 with respect to Covered Taxes imposed by the United
States by reason of such failure; provided that should a Lender Party become
subject to Covered Taxes because of its failure to deliver a form required
hereunder, the Borrower shall take such steps as such Lender Party shall
reasonably request to assist such Lender Party to recover such Covered Taxes.
(g) Any Lender Party claiming any additional amounts payable pursuant
to this Section 2.13 agrees to use reasonable efforts (consistent with its
internal policy and legal and regulatory restrictions) to change the
jurisdiction of its Eurodollar Lending Office or Domestic Lending Office if the
making of such a change would avoid the need for, or reduce the amount of, any
such additional amounts that may thereafter accrue and would not, in the
reasonable judgment of such Lender Party, be otherwise disadvantageous to such
Lender Party.
(h) If any Lender Party determines, in its sole discretion, that it has
actually and finally realized, by reason of a refund, deduction or credit of any
Covered Taxes paid or reimbursed by the Borrower pursuant to subsection (a) or
(c) above in respect of payments under the Financing Documents, a current
monetary benefit that it would otherwise not have obtained, and that would
result in the total payments under this Section 2.13 exceeding the amount needed
to make such Lender Party whole, such Lender Party shall pay to the Borrower,
with reasonable promptness following the date on which it actually realizes such
benefit, an amount equal to the lesser of the amount of such benefit or the
amount of such excess, in each case net of all out-of-pocket expenses in
securing such refund, deduction or credit.
SECTION 2.14. Evidence of Debt. (a) Each Lender Party shall maintain in
accordance with its usual practice an account or accounts evidencing the
indebtedness of the Borrower to such Lender Party resulting from the Advances or
L/C Credit Extensions and/or L/C Borrowings owing to such Lender Party from time
to time, including the amounts of principal and interest payable and paid to
such Lender Party from time to time hereunder. The Borrower agrees that upon
notice by any Lender Party to the Borrower (with a copy of such notice to the
Administrative Agent) to the effect that a promissory note or other evidence of
indebtedness is required or appropriate in order for such Lender Party to
evidence (whether for purposes of enforcement or otherwise) the Advances or L/C
Borrowings owing to, or to be made by, such Lender Party, the Borrower shall
promptly execute and deliver to such Lender Party, with a copy to the
Administrative Agent, a Note, in substantially the form of Exhibit A-1 or
Exhibit A-2 hereto, as applicable, payable to the order of such Lender Party in
a principal amount equal to the Advances and/or L/C Borrowings owing to, or to
be made by, such Lender Party. All references to Notes in the Financing
Documents shall mean Notes, if any, issued hereunder.
(b) The Register maintained by the Administrative Agent pursuant to
Section 8.07(e) shall include a control account, and a subsidiary account for
each Lender Party, in which accounts (taken together) shall be recorded (i) the
date and amount of each Advance or L/C Advance or L/C Borrowing made hereunder
(or deemed to be made hereunder), whether such Advance or L/C Borrowing bears
interest at the Base Rate or the Eurodollar Rate, and, if appropriate, the
Interest Period applicable thereto; (ii) the terms of each Assignment and
Acceptance delivered to and accepted by it; (iii) the amount of any principal or
interest due and payable or to become due and payable from the Borrower to each
Lender Party; and (iv) the amount of any sums received by the Administrative
Agent from the Borrower hereunder and each Lender Party's share thereof.
(c) Entries made in good faith by the Administrative Agent in the
Register pursuant to subsection (b) above, and by each Lender Party in its
account or accounts pursuant to subsection (a) above, shall be prima facie
evidence of the amount of principal and interest due and payable or to become
due and payable from the Borrower to, in the case of the Register, each Lender
Party and, in the case of such account or accounts, such Lender Party, under
this Agreement, absent manifest error; provided, however, that the failure of
the Administrative Agent or such Lender Party to make an entry, or any finding
that an entry is incorrect, in the Register or such account or accounts shall
not limit or otherwise affect the obligations of the Borrower under this
Agreement.
SECTION 2.15. Use of Proceeds. The proceeds of the Advances and
issuances of any Letter of Credit shall be available (and the Borrower agrees
that it shall use proceeds of Advances made to it and each Letter of Credit
issued at its request) solely (a) in the case of the Term Borrowing and, to the
extent proceeds of such Revolving Borrowing are not applied in accordance with
clause (b) below, each Revolving Borrowing on the Closing Date, to repay in full
the Existing Debt, (b) in the case of each subsequent Revolving Borrowing (and
each Revolving Borrowing comprising the Initial Borrowing that is not required
to pay the Existing Debt) and Letter of Credit, for working capital for the
Borrower and its Subsidiaries and (c) in the case of any additional borrowing
made pursuant to Section 2.16, for general corporate purposes.
SECTION 2.16. Request for Commitments. (a) Provided there exists no
Default, upon notice to the Administrative Agent (which shall promptly notify
the Lenders), the Borrower may, from time to time, request from the Lenders
commitments to make new loans (to be Advances for all purposes under this
Agreement and the other Financing Documents) in an aggregate amount (for all
such requests) not exceeding $200,000,000 (the "Incremental Commitments");
provided that (i) any such request for a commitment shall be in a minimum amount
of $50,000,000, (ii) the Borrower may make a maximum of three such requests and
(iii) the advances made pursuant to this Section 2.16 in connection with such
request shall initially be Base Rate Advances. At the time of sending such
notice, the Borrower (in consultation with the Administrative Agent) shall
specify the time period within which each Lender is requested to respond (which
shall in no event be less than ten Business Days from the date of delivery of
such notice to the Lenders). Each Lender shall notify the Administrative Agent
within such time period whether or not it agrees to provide any such commitment
and, if so, whether in an amount equal to, greater than, or less than its
ratable share of such requested commitment. Any Lender not responding within
such time period shall be deemed to have declined to make any commitment
pursuant to this Section 2.16. The Administrative Agent shall notify the
Borrower and each Lender of the Lenders' responses to each request made
hereunder. To achieve the full amount of a requested commitment, the Borrower
may also invite additional Eligible Assignees to become Lenders pursuant to a
joinder agreement in form and substance satisfactory to the Administrative Agent
and its counsel.
(b) If any Incremental Commitments are made in accordance with this
Section 2.16, the Administrative Agent and the Borrower shall determine the
effective date (the "Commitment Effective Date") and the final allocation of
such commitments. The Administrative Agent shall promptly notify the Borrower
and the Lenders of the final allocation of such commitments and the Commitment
Effective Date. As a condition precedent to such commitments, the Borrower shall
deliver to the Administrative Agent a certificate dated as of the Commitment
Effective Date (in sufficient copies for each Lender) signed by a Responsible
Officer of the Borrower (i) certifying and attaching the resolutions adopted by
the Borrower approving or consenting to such commitments, and (ii) certifying
that: (A) before and after giving effect to such commitments, the
representations and warranties of the Borrower contained in Article IV of this
Agreement and the other Financing Documents are true and correct on and as of
the Commitment Effective Date, except to the extent that such representations
and warranties specifically refer to an earlier date, in which case they are
true and correct as of such earlier date, and except that for purposes of this
Section 2.16, the representations and warranties contained in Section 4.01(g)
shall be deemed to refer to the most recent financial statements furnished
pursuant to Section 5.04, (B) before and after giving effect to such
commitments, no Default exists, (C) the Borrower is in pro forma compliance with
the covenants set forth in Section 5.03 for the period of four consecutive
fiscal quarters ending on the last date of the last fiscal quarter for which
financial statements are available immediately preceding the proposed date of
incurrence of Debt pursuant to this Section 2.16(b) (on the assumption that such
incurrence of Debt under this provision occurred on the first day of such four
fiscal quarter period and using historical results of the Borrower and its
Subsidiary for such period), (D) all Governmental Approvals necessary for the
Borrower to incur the Debt to be incurred under this Section 2.16 have been
obtained, are in full force and effect and (E) with respect to any Debt to be
incurred under this Section 2.16 prior to the Collateral Release Date, the
Borrower has complied with the Real Property Requirements.
(c) On each Commitment Effective Date, upon fulfillment of the
conditions set forth in clause (b) above, the Administrative Agent shall notify
the Lenders and the Borrower, on or before 12:00 p.m. (New York City time) on
the Business Day immediately preceding the proposed Commitment Effective Date by
facsimile of the new commitments to be made on such Commitment Effective Date
and the amount and final allocation of such commitments applicable to each
Lender. Each existing Lender making a commitment as set forth above, and each
Eligible Assignee becoming a Lender in accordance with clause (a) above shall,
before 2:00 p.m. (New York City time) on the applicable Commitment Effective
Date, make available to the Administrative Agent in immediately available funds
(i) in the case of any existing Lender, an amount equal to such Lender's
commitment and (ii) in the case of any such Eligible Assignee, an amount equal
to such Eligible Assignee's commitment. The Administrative Agent shall promptly
make such funds available to the Borrower.
(d) Each loan advanced by a Lender as a result of such Lender making a
commitment pursuant to this Section 2.16, and each loan advanced by any Eligible
Assignee becoming a Lender in accordance with clause (a) above, shall be an
"Term Advance" for all purposes hereunder. Each Eligible Assignee becoming a
Lender in accordance with clause (a) above shall be deemed to be a "Lender" for
all purposes hereunder.
(e) To the extent any Lender that makes an Advance pursuant to this
Section 2.16 already holds a Note or Notes, upon request the Borrower shall
promptly execute and deliver to such Lender, with a copy to the Administrative
Agent, a new Note, in substantially the form of Exhibit A-2 hereto, payable to
the order of such Lender in a principal amount equal to the Advance made by such
Lender pursuant to this Section 2.16.
(f) The failure of any Lender that has agreed to an Incremental
Commitment pursuant to this Section 2.16 to make an Advance with respect thereto
shall not relieve any other Lender that has agreed to an Incremental Commitment
pursuant to this Section 2.16 of its obligation to make an Advance under Section
2.16 but no Lender shall be responsible for the failure of any other Lender to
make any Advance under this Section 2.16 on any Commitment Effective Date.
ARTICLE III
CONDITIONS OF EFFECTIVENESS
SECTION 3.01. Conditions Precedent to Closing Date. No Lender shall be
required or obligated on the Closing Date to make any Advance, and no Issuing
Bank shall be required or obligated to make L/C Credit Extensions, in each case
until the first Business Day on which the following conditions precedent have
been satisfied (or waived, as evidenced by an "effective date" notice to the
Borrower from each Issuing Bank and the Administrative Agent), as determined by
each Lender and each such Issuing Bank (provided that if the Closing Date does
not occur on or before May 31, 2006, the Commitments of the Lender Parties shall
terminate on such date):
(a) The Administrative Agent's receipt of the following, each of which
shall be originals or facsimiles (followed promptly by originals) (unless
otherwise specified), each properly executed by a Responsible Officer of the
Borrower, each dated the date of the Initial Borrowing (the "Closing Date") (or,
in the case of certificates of governmental officials, a recent date before the
Closing Date) and each in form and substance satisfactory to the Lender Parties
(unless otherwise specified) and in sufficient copies for each Agent and the
Borrower (unless otherwise specified):
(i) five (5) executed counterparts of this Agreement;
(ii) to the extent requested, duly executed Notes of the Borrower for
the account of each Lender that has so requested complying with the
provisions of Section 2.14;
(iii) a security agreement in substantially the form of Exhibit D
hereto (the "Security Agreement"), duly executed by the Borrower, together
with:
(A) proper financing statements, duly completed for filing under
the Uniform Commercial Code of all jurisdictions that the
Administrative Agent may deem necessary or reasonably desirable in
order to perfect and protect the liens and security interests created
under the Collateral Documents in favor of the Secured Parties,
covering the Collateral described in the Collateral Documents;
(B) results of lien searches, dated on or no earlier than 45 days
before the Closing Date, for existing financing statements filed in the
jurisdictions referred to in Section 3.01(a)(iii)(A) that name the
Borrower as debtor, together with copies of all such financing
statements; and
(C) evidence that all other action that the Administrative Agent
may deem necessary or desirable in order to perfect and protect the
Liens and security interests in favor of the Secured Parties created
under the Security Agreement and the Account Control Agreements (both
before and after giving effect to the Closing Date Transactions), other
than the Other Perfection Requirements, has been taken;
(iv) an amendment to each Amended and Restated Mortgage (in recordable
form and otherwise in form and substance satisfactory to the Administrative
Agent) (collectively, the "Amendments"), duly executed and delivered by the
Borrower, so as to create or ensure the continued effectiveness of the Liens
created thereby, all as determined by the Administrative Agent and its
counsel, together with:
(A) confirmation from Chicago Title Insurance Company or such
other title insurers acceptable to the Administrative Agent recording
the Amendments that duly executed counterparts of such Amendments that
are sufficient for recording in all filing or recording offices that
the Administrative Agent may deem necessary or desirable in order to
create or continue valid and subsisting Liens on the property described
therein in favor of the Collateral Agent for the benefit of the Secured
Parties have been delivered to Chicago Title Insurance Company or such
other title insurer, and evidence reasonably satisfactory to the
Administrative Agent that all filing and recording taxes and fees have
been paid;
(B) a fully paid "date down" endorsement to each Mortgage Policy
for the properties encumbered by the Amended and Restated Mortgages, as
amended by the Amendments, in form and substance acceptable to the
Administrative Agent, dated the Closing Date and issued by Chicago
Title Insurance Company, which (1) states, among other things, that
since the effective date of the applicable Mortgage Policy, there have
been no changes in the state of title, including no new Liens that do
not constitute Permitted Encumbrances (as defined in the applicable
Amended and Restated Mortgage, as amended by the Amendment thereto) and
(2) shall reduce the liability amounts under the Mortgage Policies to
an amount equal to $500,000,000 in the aggregate, which amount shall be
allocated among the Mortgage Policies as determined by the
Administrative Agent.
(C) at the Administrative Agent's option, affidavits of the
Borrower, dated as of the Closing Date, certifying to the
Administrative Agent, the Collateral Agent, the Lender Parties and the
title insurance company recording the Amendments that there have been
no changes, replacements or additions to the improvements on the
properties described in the Amended and Restated Mortgages as amended
by the Amendments, which encroach upon the property or rights of
others, which violate any setback or other zoning requirements or which
violate any agreements of the Borrower, and otherwise in form and
substance satisfactory to the Administrative Agent; and
(D) evidence that all action (including payment by the Borrower
of all title search expenses, title insurance premiums, recording fees,
mortgage recording taxes and like taxes) that the Administrative Agent
may deem necessary or desirable in order to preserve, perfect and
protect the liens and security interests created under the Collateral
Documents (other than the Other Perfection Requirements) securing all
Obligations of the Borrower under the Financing Documents have been
taken;
(v) a Deposit Account Control Agreement in substantially the form of
Exhibit H hereto (as amended, the "PNC Control Agreement"), duly executed by
the Borrower and PNC Bank, National Association;
(vi) certified copies of resolutions of the board of directors of the
Borrower approving the Transactions and the execution, delivery and
performance of each Financing Document to which the Borrower is or is to be a
party, and of all documents evidencing other necessary corporate action and
governmental and other third party approvals and consents, if any, with
respect to the Transactions and each Financing Document to which the Borrower
is or is to be a party;
(vii) copies of a certificate of the Secretary of State of Delaware,
certifying (A) as to a true and correct copy of the certificate of formation
of the Borrower and each amendment thereto on file in such Secretary's office
and (B) that (1) such amendments are the only amendments to such certificate
on file in such Secretary's office, (2) the Borrower has paid all franchise
taxes to the date of such certificate and (3) the Borrower is duly formed and
in good standing or presently subsisting under the laws of the State of
Delaware;
(viii) copies of a certificate of the Secretary of State of each
jurisdiction (other than the jurisdiction of its formation) set forth in
Schedule 3.01(a) which shall be each jurisdiction where the Borrower conducts
a material portion of its business stating that the Borrower is duly
qualified to do business and in good standing as a foreign corporation in
such State and has filed all annual reports required to be filed to the date
of such certificate, as applicable;
(ix) a certificate signed on behalf of the Borrower by its secretary or
any assistant secretary (the statements made in which certificate shall be
true on and as of the Closing Date), certifying (A) as to a true and correct
copy of the Constituent Documents of the Borrower as of the Closing Date and
each amendment to its Constituent Documents, if any, from the date on which
the resolutions referred to in Section 3.01(a)(vi) were adopted to the
Closing Date, (B) the absence of any proceeding for the dissolution or
liquidation of the Borrower and (C) the names and true signatures of the
officers of the Borrower authorized to sign each Financing Document to which
it is or is to be a party and the other documents to be delivered hereunder
and thereunder;
(x) forecasts prepared by management of the Borrower of balance sheets,
income statements and cash flow statements of the Borrower reasonably
acceptable to the Administrative Agent on a consolidated basis for each
fiscal quarter commencing with the fiscal quarter ending March 31, 2006
through the fiscal quarter ending December 31, 2010;
(xi) legal opinions of appropriate counsel for the Borrower, as to such
matters as any Lender may reasonably request;
(xii) a legal opinion of Shearman & Sterling LLP, counsel to the
Administrative Agent, as to such matters as the Administrative Agent may
reasonably request;
(xiii) certificates signed by a Responsible Officer of the Borrower to
the effect that (A) the representations and warranties contained in Article
IV are true and correct on and as of the Closing Date as though made on and
as of such date both immediately before and immediately after giving effect
to the consummation of that portion of the Transactions being effected on the
Closing Date (the "Closing Date Transactions"); and (B) no Default has
occurred and is continuing or would result from the Initial Borrowing or
would result from the consummation of the Closing Date Transactions; and
(xiv) audited Consolidated financial statements for the Borrower and
its Subsidiaries for the fiscal year ending December 31, 2005.
(b) All Governmental Approvals and third party consents and approvals
necessary in connection with the Transactions shall have been obtained and be in
full force and effect; and the Administrative Agent shall have received evidence
satisfactory to it that the foregoing have been accomplished.
(c) Except for Disclosed Matters as of the date hereof, since December
31, 2005, there shall not have occurred any Material Adverse Change.
(d) All required stamp duties, registration fees, filing costs and
other charges in connection with the execution, delivery, filing, recording,
perfection, priority or admissibility in evidence of the Financing Documents,
and the security interests purported to be granted by the Financing Documents,
required to be paid on or prior to the Closing Date shall have been paid in full
or an appropriate exemption therefrom shall have been obtained.
(e) All Taxes (i) due and payable on or prior to the Closing Date in
connection with the execution, delivery, filing, recording or admissibility in
evidence of the Financing Documents or to ensure the legality, validity,
enforceability, perfection or admissibility in evidence of the Financing
Documents and (ii) due and payable on or prior to the Closing Date by the
Borrower or any of its Subsidiaries in connection with the consummation of the
transactions contemplated by, and the performance of, the Financing Documents
shall, in the case of clauses (i) and (ii) of this Section 3.01(f), have been
duly paid in full.
(f) The Borrower shall have paid all accrued fees of the Agents, the
Lender Parties and the Arranger Parties and all accrued expenses of the Agents
to the extent invoiced at least three Business Days prior to the Closing Date.
SECTION 3.02. Conditions Precedent to Each Borrowing and L/C Credit
Extension. The obligation of each Lender to make an Advance (other than an L/C
Advance made by an Issuing Bank or a Revolving Lender pursuant to Section
2.03(a) and a Swing Line Advance made by a Revolving Lender pursuant to Section
2.02(c)) on the occasion of each Borrowing (including the Initial Borrowing) to
the Borrower, and the obligation of the Issuing Bank to issue, amend to increase
the principal amount thereof or extend any Letter of Credit (other than an
extension pursuant to an Automatic Extension Letter of Credit in accordance with
the original terms thereof) and the right of the Borrower to request a Swing
Line Borrowing, shall be subject to the further conditions precedent that on the
date of such Borrowing or L/C Credit Extension, the following statements shall
be true (and each of (x) the giving of the applicable Notice of Borrowing or
Notice of Swing Line Borrowing and (y) the acceptance by the Borrower of the
proceeds of such Borrowing or Letter of Credit shall constitute a representation
and warranty by the Borrower that both on the date of such notice and on the
date of such Borrowing or issuance such statements are true):
(a) the representations and warranties of the Borrower contained in
Article IV (except, in the case of a Borrowing other than the Initial Borrowing,
clause (f), clause (g)(ii) and the final sentence in clause (g)(i) of Section
4.01) and, prior to the Collateral Release Date, Article III of the Security
Agreement are true and correct on and as of such date, before and after giving
effect to such Borrowing or L/C Credit Extension and to the application of the
proceeds therefrom, as though made on and as of such date (other than as to any
such representations or warranties that, by their terms, refer to a specific
date other than the date of the Borrowing or L/C Credit Extension, in which case
they shall be true and correct as of such specific date);
(b) no Default has occurred and is continuing, or would result from
such Borrowing or L/C Credit Extension or from the application of the proceeds
therefrom; and
(c) in the case of any Advance or issuance of any Letter of Credit, in
each case, made after the Closing Date, the Closing Date has occurred.
SECTION 3.03. Determinations Under Sections 3.01 and 3.02. For purposes
of determining compliance with the conditions specified in Sections 3.01 and
3.02, each Lender Party shall be deemed to have consented to, approved or
accepted or to be satisfied with each document or other matter required
thereunder to be consented to or approved by or acceptable or satisfactory to it
unless an officer of the Administrative Agent responsible for the transactions
contemplated by the Financing Documents shall have received notice from such
Lender Party prior to the date of the Borrowing or issuance of any Letter of
Credit (as applicable) specifying its objection thereto and, in the case of a
Borrowing, such Lender Party shall not have made available to the Administrative
Agent such Lender Party's ratable portion of such Borrowing.
ARTICLE IV
REPRESENTATIONS AND WARRANTIES
SECTION 4.01. Representations and Warranties. The Borrower represents
and warrants to each Lender Party and each Agent as of the date hereof, as of
the Closing Date and as of the date of any Borrowing or issuance of an L/C
Credit Extension, as follows:
(a) The Borrower (i) is a limited liability company duly organized,
validly existing and in good standing under the laws of the State of Delaware
and (ii) has all requisite limited liability company power and authority
(including all Governmental Approvals) to carry on its business as now
conducted, except, in the case of clause (ii) only, where the failure to so
qualify or be so licensed, or to have such power and authority, could not
reasonably be expected to have a Material Adverse Effect.
(b) Set forth on Schedule 4.01(b) is a complete and accurate list of
all Subsidiaries of the Borrower as of the Closing Date, showing (as to each
such Subsidiary) the jurisdiction of its formation, the number of shares of each
class of its Equity Interests authorized, and the number outstanding, on the
date hereof and the percentage of each such class of its Equity Interests, the
identity of each owner thereof and the number of shares covered by all
outstanding options, warrants, rights of conversion or purchase and similar
rights at the date hereof.
(c) The execution, delivery and performance by it of each Financing
Document to which it is or is to be a party, and the consummation of the
Transactions, are within its limited liability company powers, have been duly
authorized by all necessary limited liability company action, and do not and
will not (i) contravene its Constituent Documents, (ii) violate any law, rule,
regulation (including Regulation X of the Board of Governors of the Federal
Reserve System), order, writ, judgment, injunction, decree, determination or
award, (iii) conflict with or result in the breach of, or constitute a default
or require any payment to be made under, any material contract, loan agreement,
indenture, mortgage, deed of trust, lease or other instrument binding on or
affecting it or any of its properties or (iv) except for the Liens created under
the Financing Documents, result in or require the creation or imposition of any
Lien upon or with respect to any of its Assets, except where, in the case of
clauses (i) through (iv), the violation of any such Constituent Documents, law,
rule, regulation, permit, order, writ, judgment, injunction, decree,
determination or award, breach of any such contract, loan agreement, indenture,
mortgage, deed of trust, lease or other instrument, or creation or imposition of
such Lien, could not be reasonably expected to have a Material Adverse Effect.
(d) No authorization or approval or other action by, and no notice to
or filing with, any Governmental Authority or any other third party is required
for (i) the due execution, delivery, recordation, filing or performance by the
Borrower of any Financing Document to which it is or is to be a party, or for
the consummation of the Transactions, (ii) prior to the Collateral Release Date,
the grant by the Borrower of the Liens granted by it pursuant to the Collateral
Documents, or (iii) prior to the Collateral Release Date, the perfection or
maintenance of the Liens created under the Collateral Documents (including the
priority nature thereof as stated in the Security Agreement) other than (A)
filing of the financing statements duly completed for filing under the UCC
covering the Collateral described in the Collateral Documents, (B) the filing of
the Amendments (and, upon the filing of such financing statements in the
relevant jurisdictions and the filing of the Amendments, all authorizations,
approvals, actions by, and notices to or filings with, any Governmental
Authority required for the perfection of the Liens created by the Collateral
Documents (including the priority nature thereof as stated in the Security
Agreement), other than the Other Perfection Requirements, shall have been duly
obtained, taken and filed) and (C) the Other Perfection Requirements, except (1)
for the authorizations, approvals, actions, notices and filings (the
"Governmental Approvals"), all of which have been duly obtained, taken, given or
made, are in full force and effect, are held in the name of the Borrower and are
free from any conditions or requirements that have not been satisfied, and are
required to be satisfied, on or prior to the dates as of which this
representation and warranty is made or reaffirmed and (2) as disclosed on
Schedule 4.01(d).
(e) This Agreement has been, and each other Financing Document when
delivered hereunder will have been, duly executed and delivered by it. This
Agreement is, and each other Financing Document when delivered hereunder will
be, its legal, valid and binding obligation, enforceable against it in
accordance with its terms, except to the extent limited by any applicable
bankruptcy, insolvency, reorganization, moratorium or similar laws affecting the
enforcement of creditors' rights generally and by general principles of equity.
(f) There is no action, suit, investigation, litigation or proceeding,
including any Environmental Action, which has commenced against it or any of its
Subsidiaries or any of their respective properties or to its knowledge, pending
(but not yet commenced) or, to the knowledge of the Borrower, threatened against
it or any of its Subsidiaries or any of their respective properties before any
Governmental Authority that (i) except for Disclosed Matters, if adversely
determined, could reasonably be expected to have a Material Adverse Effect
(other than the matters described on Schedule 4.01(f) (the "Disclosed
Litigation")) or (ii) affects or could reasonably be expected to affect the
legality, validity or enforceability of any Financing Document or the
consummation of the Transactions.
(g) (i) Each of the financial statements of the Borrower delivered to
the Administrative Agent pursuant to Sections 5.04(b) and 5.04(c) is true,
complete and correct in all material respects as of the date of such statement,
has been prepared in accordance with GAAP (subject, in the case of interim
financial statements, to normal year-end audit adjustments and the absence of
footnotes), and fairly presents in all material respects the financial condition
and results of operations of the Borrower and its Subsidiaries as of the date
thereof. Except (A) for Disclosed Matters or (B) as set forth in Schedule
4.01(g), since the date of the most recent financial statements delivered under
this Agreement, no event, condition, occurrence or circumstance has existed or
has occurred and is continuing which could reasonably be expected to have a
Material Adverse Effect.
(ii) Since December 31, 2005, no Material Adverse Change has occurred,
except for Disclosed Matters as of the date hereof.
(h) Neither the Information Memorandum, taken as a whole, nor any other
information, exhibit or report furnished by the Borrower to any Agent, any
Arranger Party or any other Lender Party in connection with the negotiation and
syndication of the Financing Documents or the consummation of the Transactions
or pursuant to the terms of the Financing Documents, when taken together with
the information contained in the Parent's most recent annual report on Form 10-K
(the "Form 10-K") and in Parent's reports filed with the SEC under the
Securities Exchange Act of 1934 subsequent to the filing of the Form 10-K and
the Borrower's financial statements delivered pursuant to Section 3.01(a)(xiv),
taken as a whole, contains (as of the date on which such information is or was
provided to any Agent, any Arranger Party or any Lender Party, as modified or
otherwise supplemented by information so provided) any untrue statement of a
material fact or omits to state a material fact necessary to make the statements
made therein, in light of the circumstances under which they were, are or will
be made, not misleading; provided that to the extent any such information,
exhibit or report was based upon or constitutes a forecast or projection, the
Borrower represents only that such information was prepared in good faith on the
basis of the assumptions stated therein, which assumptions were believed by the
Borrower to be reasonable at the time (it being understood that such forecasts
or projections are subject to significant uncertainties and contingencies, many
of which are beyond the Borrower's control, and that the Borrower makes no
representation as to the attainability of such forecasts or projections or as to
whether such forecasts or projections will be achieved or will materialize).
(i) The Borrower is not engaged principally, or as one of its important
activities, in the business of extending credit for the purpose of purchasing or
carrying Margin Stock, and no proceeds of any Advance will be used to purchase
or carry any Margin Stock or to extend credit to others for the purpose of
purchasing or carrying any Margin Stock for any purpose that violates, or is
inconsistent with, the provisions of Regulation T, U or X of the Board of
Governors of the Federal Reserve System, as in effect from time to time. If
requested by any Lender or the Administrative Agent, the Borrower will furnish
to the Administrative Agent and such Lender a statement to the foregoing effect
in conformity with the requirements of FR Form G-3 or FR Form U 1, as
applicable, referred to in Regulation U of the Board of Governors of the Federal
Reserve System, as in effect from time to time.
(j) Neither the Borrower nor any of its Subsidiaries is an "investment
company", as such term is defined in the 1940 Act.
(k) Prior to the Collateral Release Date, all filings and other actions
(other than the Other Perfection Requirements) necessary or reasonably desirable
(and requested by the Administrative Agent) to perfect and protect the security
interest in favor of the Lenders and the Agents in the Collateral created under
the Collateral Documents have been duly made or taken and are in full force and
effect, and the Collateral Documents create in favor of the Collateral Agent for
the benefit of the Secured Parties a valid and, together with such filings and
other actions, perfected first priority security interest in the Collateral,
securing the payment of the Secured Obligations owed to the Secured Parties
hereunder. Prior to the Collateral Release Date, the Borrower is the legal and
beneficial owner of the Collateral free and clear of any Lien, except for the
liens and security interests created or permitted under the Financing Documents.
(l) (i) Except as disclosed on Schedule 4.01(l) or in the Parent's
filings with the SEC or as could not reasonably be expected to have a Material
Adverse Effect, (A) the operations and properties of the Borrower and each of
its Subsidiaries comply in all respects with all applicable Environmental Laws
and Environmental Permits, (B) all past non-compliance with such Environmental
Laws and Environmental Permits has been resolved without material ongoing
obligations or costs and (C) no circumstances exist that could reasonably be
expected to (I) form the basis of an Environmental Action against the Borrower
or any of its Subsidiaries or any of their properties or (II) cause any such
property to be subject to any restrictions on ownership, occupancy, use or
transferability under any Environmental Law.
(ii) Except as disclosed on Schedule 4.01(l) or in the Parent's filings
with the SEC or as could not reasonably be expected to have a Material Adverse
Effect, (A) none of the properties currently or formerly owned or operated by
the Borrower or any of its Subsidiaries is listed or proposed for listing on the
NPL or on the CERCLIS or any analogous foreign, state or local list, (B) to its
knowledge, there are no and never have been any unlawful underground or
aboveground storage tanks or any unlawful surface impoundments, septic tanks,
pits, sumps or lagoons in which Hazardous Materials are being or have been
treated, stored or disposed of on any property currently owned or operated by
the Borrower or any of its Subsidiaries or on any property formerly owned or
operated by the Borrower or any of its Subsidiaries, and (C) Hazardous Materials
have not been released, discharged or disposed of on any property currently or
formerly owned or operated by the Borrower or any of its Subsidiaries.
(iii) Except as disclosed on Schedule 4.01(l) or in the Parent's
filings with the SEC or as could not reasonably be expected to have a Material
Adverse Effect, (A) neither the Borrower nor any of its Subsidiaries is
undertaking, and has not completed, either individually or together with other
potentially responsible parties, any investigation or assessment or remedial or
response action relating to any actual or threatened release, discharge or
disposal of Hazardous Materials at any site, location or operation, either
voluntarily or pursuant to the order of any governmental or regulatory authority
or the requirements of any Environmental Law, and (B) all Hazardous Materials
generated, used, treated, handled or stored at, or transported to or from, any
property currently or formerly owned or operated by the Borrower or any of its
Subsidiaries have been used, sold or disposed of in a manner not reasonably
expected to result in material liability to the Borrower or any of its
Subsidiaries.
(m) (i) Neither the Borrower nor any of its Subsidiaries is party to
any tax sharing agreement other than the Tax Allocation Agreement. Insofar as
then required thereunder, all amounts due and payable by the Borrower or any of
its Subsidiaries under the Tax Allocation Agreement have been paid, and all
amounts due and payable to the Borrower or any of its Subsidiaries under any tax
sharing agreement have been received (including amounts by way of compensation
for the use of tax benefits), except as could not reasonably be expected to have
a Material Adverse Effect.
(ii) The Borrower has, and each of its Subsidiaries has, filed, caused
to be filed or been included in all tax returns (federal, state, local and
foreign) required to be filed and has paid all taxes shown thereon to be due,
together with applicable interest and penalties, except (A) to the extent that
the aggregate amount of any unpaid taxes due, together with applicable interest
and penalties, does not exceed $25,000,000 or (B) to the extent such unpaid
taxes are subject to Contest.
(n) Set forth on Part I of Schedule 4.01(n) is a complete and accurate
list of all real property with a book value, as of the date hereof, in excess of
$10,000,000 owned by the Borrower or any of its Subsidiaries, showing, as of the
Closing Date, the street address, county or other relevant jurisdiction, state,
and record owner thereof, and showing, as of December 31, 2005, the book value
thereof. The Borrower or such Subsidiary has, as of the Closing Date, good,
marketable and insurable fee simple title to all real property on such Schedule,
free and clear of all Liens, other than Liens permitted under the Financing
Documents or, prior to the Collateral Release Date, created under the Financing
Documents. As of the date hereof, and prior to the Collateral Release Date,
there have been (A) no changes, replacements or additions to the improvements on
the properties described in the Mortgages that are not the subject of mortgagee
title insurance which encroach upon the property or rights of others, which
violate any setback or other zoning requirements or which violate any agreements
of the Borrower, except as disclosed in Part II of Schedule 4.01(n), and (B) no
Liens or encumbrances affecting the properties described in the Mortgages that
are not the subject of mortgagee title insurance, except Liens permitted under
the Financing Documents and except as disclosed on Part III of Schedule 4.01(n).
(o) All property and general liability insurance maintained by or on
behalf of the Borrower and its Subsidiaries as of the Closing Date is in full
force and effect and all premiums that are due and owed have been duly paid,
except where the failure to pay could not reasonably be expected to have a
Material Adverse Effect. None of the Borrower or any of its Subsidiaries has any
reason to believe that it will not be able to renew its existing coverage as and
when such coverage expires or to obtain similar coverage from similar insurers
at a substantially similar cost as available to companies of a similar size
operating in the same or similar businesses.
(p) As of the Closing Date, none of the Subsidiaries of the Borrower
(other than AGC, ▇▇▇▇▇▇▇▇ Generation, LLC, each Material Subsidiary, Allegheny
Energy Supply ▇▇▇▇▇▇▇, LLC, Allegheny Energy Supply Wheatland, LLC, Acadia Bay
Energy Company, LLC, and ▇▇▇▇▇▇▇▇ Energy Company of Virginia, LLC) individually
holds any Assets, including any deposit or securities accounts, with a book
value in excess of $10,000,000.
(q) No Default has occurred and is continuing.
(r) Set forth on Schedule 4.01(r) is a complete and accurate list as of
the Closing Date (except, solely with respect to the amount thereof, as
otherwise indicated thereon) of outstanding Debt for Borrowed Money owed by the
Borrower or any of its Subsidiaries with an aggregate principal amount in excess
of $10,000,000, showing the amount, obligor or issuer, creditor and maturity
thereof.
ARTICLE V
COVENANTS
SECTION 5.01. Affirmative Covenants. The Borrower covenants and agrees
that on and after the date hereof and until the Notes, together with all accrued
interest thereon, fees and all other Senior Debt Obligations (other than
contingent indemnification obligations not yet due and payable) are paid in full
and all Commitments and each Letter of Credit shall have terminated, it will:
(a) Compliance with Laws. Comply, and cause each of its Subsidiaries to
comply, with all Applicable Laws, except where the failure to do so could not
reasonably be expected to have a Material Adverse Effect.
(b) Compliance with Environmental Laws. Except where the failure to do
so could not reasonably be expected to have a Material Adverse Effect, (i)
comply, and cause each of its Subsidiaries and all lessees and other Persons
operating or occupying its properties to comply, with all applicable
Environmental Laws and Environmental Permits, (ii) obtain and renew, and cause
each of its Subsidiaries to obtain and renew, all Environmental Permits
necessary for its operations and properties and (iii) conduct, and cause each of
its Subsidiaries to conduct, any required investigation, study, sampling and
testing, and undertake any cleanup, removal, remedial or other action, necessary
to remove and clean up all Hazardous Materials from any of its properties
required under any Environmental Law.
(c) Payment of Taxes, Etc. Except where the failure to do so could not
reasonably be expected to have a Material Adverse Effect, pay and discharge, and
cause each of its Subsidiaries to pay and discharge, before the same shall
become delinquent, (i) all taxes, assessments and governmental charges or levies
imposed upon it or upon its property and (ii) all lawful claims that, if unpaid,
will by law become a Lien upon its property not permitted by Section 5.02(a);
provided that neither the Borrower nor any of its Subsidiaries shall be required
to pay or discharge any such tax, assessment, charge or claim that is the
subject of a Contest.
(d) Insurance. (i) Maintain, and cause each of its Subsidiaries to
maintain, insurance with responsible and reputable insurance companies or
associations in such amounts and covering such risks as is usually carried by
companies engaged in similar businesses and owning similar properties in the
same general areas in which the Borrower or such Subsidiary operates.
(ii) Within 30 Business Days after the Closing Date, deliver evidence
to the Administrative Agent that the Collateral Agent has been named as an
additional insured (and, in the case of all property and general liability
insurance, as loss payee) with respect to all property damage and liability
insurance required under this Section 5.01(d).
(e) Preservation of Corporate Existence, Etc. Except as could not
reasonably be expected to have a Material Adverse Effect, preserve and maintain,
and cause each Material Subsidiary to preserve and maintain, its existence,
legal structure, rights (charter or statutory), permits, licenses, approvals,
franchises and privileges in the jurisdiction of its formation and in each other
jurisdiction in which the conduct of its business requires it to so qualify;
provided, however, that the Borrower and any Subsidiary may consummate any
merger or consolidation permitted under Section 5.02(d).
(f) Visitation Rights. At any reasonable time during normal business
hours and from time to time as may be reasonably desired by any of the Agents or
Lender Parties (provided that unless a Default shall have occurred and be
continuing, such visits should be limited to twice per year), at the Borrower's
reasonable cost and expense, permit any Agent or any Lender Party, or any agents
or representatives thereof, to examine and make copies of and abstracts from its
records and books of account of, and visit the properties of, the Borrower and
its Subsidiaries, and to discuss the affairs, finances and accounts of the
Borrower and any of its Subsidiaries with any of their officers or directors and
with their independent certified public accountants; provided that in the case
of any discussion or meeting with the independent public accountants, only if
the Borrower has been given the opportunity to participate in such discussion.
(g) Keeping of Books. Keep, and cause each of its Subsidiaries to keep,
proper books of record and account in accordance with GAAP in effect from time
to time.
(h) Maintenance of Properties, Etc. Other than as mandatorily required
by Applicable Law, operate, maintain and preserve, and cause each Material
Subsidiary to operate, maintain and preserve, all of its properties (other than
any such properties as are immaterial or non-essential to the conduct of
business by the Borrower and the Material Subsidiaries, taken as a whole) that
are used or useful in the conduct of its business in good working order and
condition (ordinary wear and tear excepted) in accordance with prudent practices
then being utilized in the merchant, non-regulated power generation industry and
in accordance with Applicable Laws (including Environmental Laws) in all
material respects.
(i) Transactions with Affiliates. Other than as may be required by the
Federal Power Act, as amended, or any rule or regulation issued by the FERC,
conduct, and cause each of its Subsidiaries to conduct, (i) all transactions
with any of the Affiliates of the Borrower on terms that are fair and reasonable
and no less favorable to the Borrower or such Subsidiary than it would obtain in
a comparable arm's-length transaction with a Person not an Affiliate of the
Borrower and (ii) all transactions with a Person other than an Affiliate of the
Borrower on terms that are without regard to any benefit or detriment to any
Affiliate of the Borrower (other than any Subsidiary); provided that this
Section 5.01(i) shall not be deemed to permit any transaction otherwise
prohibited by the terms of this Agreement. Without prejudice to the foregoing,
the following transactions shall be deemed to be in compliance with this Section
5.01(i): (A) any agreements made by the Borrower or any of its Subsidiaries with
a utility to provide provider of last resort requirements, as such agreements
are amended from time to time, so long as such provider of last resort
agreements are with an Affiliate of the Borrower and approved by all applicable
Governmental Authorities, (B) any transaction authorized under a tariff or rate
schedule which has been approved by the FERC or performed in accordance with
FERC orders and (C) any Asset sales, leases, transfers, swaps, exchanges or
other dispositions (including in respect of full or partial ownership
percentages of transmission lines (including the AGC Transmission Line),
generating facilities, generating equipment and related contract rights in power
purchase agreements, leases, licenses, permits and other Assets) as contemplated
(1) under Section 5.02(d)(i)(F) in respect of up to $10,000,000 in the aggregate
of such Assets and (2) under Sections 5.02(d)(i)(I) and (L). For the avoidance
of doubt, any contracts or arrangements listed on Schedule 5.01(i) to which the
Borrower or any Subsidiary is a party (and any amendments thereto, renewals or
replacements thereof on substantially the same terms as determined in good faith
by a Responsible Officer of the Borrower or any Subsidiary of the Borrower that
is a party thereto) shall be deemed to comply with this Section 5.01(i) except
to the extent that any Governmental Authority determines that any such contract
is not in conformance with Applicable Law and such non-conforming contract is
not on terms described in the first sentence of this Section 5.01(i).
(j) Further Assurances. Prior to the Collateral Release Date, promptly
upon request by any Agent or any Lender Party, do, execute, acknowledge,
deliver, record, re-record, file, re-file, register and re-register any and all
such further acts, deeds, conveyances, pledge agreements, mortgages, deeds of
trust, trust deeds, assignments, financing statements and continuations thereof,
termination statements, notices of assignments, transfers, certificates,
assurances and other instruments as any Agent or any Lender may reasonably
require from time to time in order to (A) carry out more effectively the
purposes of the Financing Documents, (B) to the full extent permitted by
Applicable Law, subject the Borrower's properties, assets, rights or interests
(other than the Excluded Assets) to the Liens now or hereafter intended to be
covered by any of the Collateral Documents, (C) perfect and maintain the
validity, effectiveness and priority of any of the Collateral Documents and any
of the Liens intended to be created thereunder and (D) assure, convey, grant,
assign, transfer, preserve, protect and confirm more effectively unto the
Secured Parties the rights granted or now or hereafter intended to be granted to
the Secured Parties under any Financing Document or under any other instrument
executed in connection with any Financing Document to which the Borrower is or
is to be a party.
(k) Preparation of Environmental Reports. If prior to the Collateral
Release Date any Agent shall reasonably believe that a material environmental
event has occurred on any parcel of real property owned or leased by the
Borrower or any of its Subsidiaries after the date hereof, provide to each Agent
within 90 days after receipt of a written request from such Agent in which the
Agent describes in reasonable detail the basis of such belief, at the expense of
the Borrower, a Phase I environmental site assessment report for the properties
described in such request prepared by an environmental consulting firm
reasonably acceptable to the Administrative Agent, indicating the presence or
absence of Hazardous Materials and the estimated cost of any legally required
compliance, removal or remedial action in connection with any Hazardous
Materials on such properties. Without limiting the generality of the foregoing,
if any Agent determines at any time that a material risk exists that any such
report will not be provided within the time referred to above, the
Administrative Agent may, at the time following the 45th day after the request
of such Agent, retain an environmental consulting firm to prepare such report at
the expense of the Borrower, and the Borrower hereby grants and agrees to cause
any Subsidiary that owns any property described in such request to grant at the
time of such request to the Administrative Agent, such firm and any agents or
representatives thereof an irrevocable non-exclusive license, subject to the
rights of tenants, to enter onto their respective properties to undertake such
an assessment.
(l) Real Property. Prior to the Collateral Release Date, promptly upon
the request of the Administrative Agent (but in any event within 75 days of such
request) deliver to the Collateral Agent (with copies to the Administrative
Agent) the following: (i) mortgages, deeds of trust, trust deeds, leasehold
mortgages and leasehold deeds of trust (the "New Mortgages") duly executed by
the Borrower in respect of the Acquired Material Property, each such New
Mortgage to be substantially in the form of the most relevant Amended and
Restated Mortgage (based on, for example, the state and county in which such New
Mortgage will be recorded) recorded on or about July 21, 2005 (the "Recorded
Term Mortgages"), with such changes to account for (A) local law matters as
advised by the Administrative Agent's local counsel, (B) property/transaction
specific matters that are necessary or desirable in the opinion of the
Administrative Agent and (C) any other matters that are necessary or desirable
in the opinion of the Administrative Agent; provided that the starting form for
such New Mortgage shall be a Recorded Term Mortgage; and provided further that
if the property to be encumbered by a New Mortgage is in a state in which no
Recorded Term Mortgage exists, the starting form to be used shall be the most
suitable form from among the Recorded Term Mortgages, as determined by the
Administrative Agent; (ii) confirmations from the title insurance company
recording the New Mortgages that duly executed counterparts of such New
Mortgages that are sufficient for recording in all filing or recording offices
that the Administrative Agent may deem necessary or desirable in order to create
valid and subsisting Liens on the property described therein in favor of the
Collateral Agent for the benefit of the Secured Parties have been delivered to
such title insurance company, and evidence reasonably satisfactory to the
Administrative Agent that all filing and recording taxes and fees have been
paid; (iii) fully paid American Land Title Association Lender's Extended
Coverage title insurance policies in form and substance, with endorsements and
in amounts acceptable to the Administrative Agent, issued by title insurers
acceptable to the Administrative Agent, insuring the New Mortgages to be valid
and subsisting Liens on the properties described therein, free and clear of all
defects (including mechanics' Liens and materialmen's Liens) and encumbrances,
excepting only Permitted Liens (other than mechanics' liens and materialmen's
liens to be insured against under said policies), and providing for such other
affirmative insurance as the Administrative Agent may deem necessary or
desirable; (iv) ALTA Surveys (for which all necessary fees (where applicable)
have been paid) of the Material Acquired Property dated reasonably near the date
of such delivery; (v) confirmation from the title insurance company recording
such New Mortgages with respect to the validity and (subject to the exceptions
and encumbrances permitted therein) the priorities of such New Mortgages; and
(vi) evidence that all action (including payment by the Borrower to the title
insurance company recording such New Mortgages of the amount previously notified
by such title insurance company to the Borrower as necessary for it to record
such New Mortgages) that the Administrative Agent may deem necessary or
desirable in order to perfect and protect the liens and security interests
created under the Collateral Documents (other than the Other Perfection
Requirements) securing all Obligations of the Borrower under the Financing
Documents have been taken; provided that in the case of any Acquired Material
Property acquired by or otherwise transferred to the Borrower in connection with
a Permitted Asset Swap, the Borrower shall comply with the requirements of the
first sentence of this Section 5.01(l) no later than five days after such
acquisition or transfer, whether or not the Administrative Agent shall have made
a request therefor. In the event that any additional Advances are made hereunder
pursuant to Section 2.16 prior to the Collateral Release Date, the Borrower
shall, within twenty (20) days of each such Advance, obtain from each title
insurance company that has issued a mortgagee title insurance policy, a "date
down" endorsement (in form and substance reasonably satisfactory to the
Administrative Agent) at the time of each such additional Advance, without
increase to the aggregate insured amount of the coverage provided to the
Administrative Agent under the Mortgage Policies.
(m) Additional Material Subsidiaries. Promptly (but in any event no
later than 45 Business Days or, if any of the following occurs in connection
with a Permitted Asset Swap, no later than five days after such occurrence)
after the incorporation or formation of a Material Subsidiary (other than AE
Capital) or after any Subsidiary (other than AE Capital) becomes a Material
Subsidiary, in each case, to the extent the same occurs prior to the Collateral
Release Date, deliver to the Collateral Agent (with a copy to the Administrative
Agent) the following: (i) certificate(s) representing Equity Interests in such
Material Subsidiary, if any, owned by the Borrower and its other Subsidiaries,
accompanied by undated stock powers (or an equivalent instrument) executed in
blank, (ii) if such Material Subsidiary is not a direct Subsidiary of the
Borrower, a security or pledge agreement (substantially in the form of the
Security Agreement insofar as the provisions thereof relate to the granting of a
security interest in Equity Interests or rights with respect to the Equity
Interests pledged thereunder), duly executed by the parent of such Material
Subsidiary, securing the Senior Debt Obligations, (iii) evidence that all other
action that the Administrative Agent may reasonably deem necessary or desirable
in order to perfect and protect the first priority Liens and security interests
created under the Security Agreement (with respect to the Equity Interests in
such Material Subsidiary owned by the Borrower, if any) or, if such Material
Subsidiary is not a direct Subsidiary of the Borrower, under the pledge or
security agreement referred to in clause (ii) above (with respect to the Equity
Interests in such Material Subsidiary owned by each other Subsidiary of the
Borrower) and (iv) in respect of any pledge or security agreement referred to in
clause (ii) above only, customary legal opinions in respect thereof, in form and
substance reasonably satisfactory to the Administrative Agent.
SECTION 5.02. Negative Covenants. The Borrower covenants and agrees
that on and after the date hereof and until the Notes, together with all accrued
interest thereon, fees and all other Senior Debt Obligations (other than
contingent indemnification obligations not yet due and payable) are paid in full
and all Commitments and each Letter of Credit shall have terminated, the
Borrower will not, at any time:
(a) Liens, Etc. Create, incur, assume or suffer to exist, or permit any
Material Subsidiary to create, incur, assume or suffer to exist, any Lien on or
with respect to any of its properties of any character (including accounts)
whether now owned or hereafter acquired, or sign or file or suffer to exist, or
permit any Material Subsidiary to sign or file or suffer to exist, under the
Uniform Commercial Code of any jurisdiction, a financing statement that names
the Borrower or any Material Subsidiary as debtor, or sign or suffer to exist,
or permit any Material Subsidiary to sign or suffer to exist, any security
agreement authorizing any secured party thereunder to file such financing
statement, or assign, or permit any Material Subsidiary to assign, any accounts
or other right to receive income, except:
(i) any Liens (A) created pursuant to the Financing Documents
(including Section 2.03(e)) and Permitted Refinancing Debt with respect to
all Senior Debt Obligations or (B) securing Debt permitted pursuant to (1)
Section 5.02(b)(ii) (to the extent such Debt is outstanding under Pollution
Control Bonds), (2) Section 5.02(b)(iii), (3) Section 5.02(b)(iv), (4)
Section 5.02(b)(xxi) or (5) Section 5.02(b)(xvii) (to the extent such
Permitted Refinancing Debt is incurred in respect of any of the foregoing);
(ii) Permitted Liens;
(iii) Liens existing on the date hereof and described on Schedule
5.02(a);
(iv) purchase money Liens upon or in real property, physical assets or
equipment acquired or held by the Borrower or any Material Subsidiary in the
ordinary course of business to secure the purchase price of such real
property, physical assets or equipment or to secure Debt permitted to be
incurred pursuant to Section 5.02(b)(vii) incurred solely for the purpose of
financing the acquisition, construction or improvement of any such real
property, physical assets or equipment to be subject to such Liens, or Liens
existing on any such real property, physical assets or equipment at the time
of acquisition (other than any such Liens created in contemplation of such
acquisition that do not secure the purchase price), or extensions, renewals
or replacements of any of the foregoing for the same or a lesser amount;
provided, however, that (A) such Lien is incurred and the Debt secured
thereby is created within 90 days after the acquisition, completion of
construction or completion of improvement thereof (as applicable), and (B) no
such Lien shall extend to or cover any property, physical assets or equipment
other than the real property, physical assets or equipment being acquired,
constructed or improved; and provided further that the aggregate principal
amount of the Debt secured by Liens permitted by this clause (iv) shall not
exceed the amount permitted under Section 5.02(b)(vii) at any time
outstanding;
(v) Liens arising in connection with Capitalized Leases permitted under
Section 5.02(b)(viii); provided that no such Lien shall extend to or cover
any Assets (or, prior to the Collateral Release Date, any Collateral) other
than the Assets subject to such Capitalized Leases;
(vi) Liens on cash or Cash Equivalents (A) deposited in margin accounts
with or on behalf of futures contract brokers or paid over to other contract
counterparties or (B) pledged or deposited as collateral to a contract
counterparty to secure obligations with respect to (1) contracts (other than
for Debt) for commercial and trading activities in the ordinary course of
business for the purchase, transmission, distribution, sale, storage, lease
or hedge of any energy related commodity or (2) Hedge Agreements representing
commodity price contracts, transmission agreements or derivatives or interest
rate derivatives to the extent that the Borrower or any Material Subsidiary
is permitted to enter into any such Hedge Agreement pursuant to Section
5.02(b)(vi);
(vii) Liens on property of a Person existing at the time such Person is
merged into or consolidated with the Borrower or any Material Subsidiary;
provided that such Liens were not created in contemplation of such merger or
consolidation and do not extend to any Assets other than those of the Person
merged into or consolidated with the Borrower or such Material Subsidiary;
(viii) Liens granted by the Borrower or any Material Subsidiary in
favor of a commercial trading counterparty, a futures contract broker or
other contract counterparty on accounts receivable arising under, commodities
covered by, other obligations owed to, and other rights of the Borrower or
such Material Subsidiary, in each case, under any contract (other than for
Debt) entered into in the ordinary course of business in connection with
commercial and trading activities (including any netting agreement) to secure
the Borrower's or such Material Subsidiary's obligations under such contract;
provided that such Liens are granted in the ordinary course of business and,
when granted, do not secure obligations which are past due;
(ix) Liens granted on cash or Cash Equivalents to defease Debt of the
Borrower or any of its Subsidiaries that is not prohibited by Section
5.02(b);
(x) Liens granted on cash or Cash Equivalents constituting proceeds
from any sale or disposition of Assets that is not prohibited by Section
5.02(d) deposited in escrow accounts to secure Debt permitted to be incurred
under Section 5.02(b)(xii) in respect of such sale or disposition;
(xi) other Liens affecting property with an aggregate fair market value
not to exceed 15% of Consolidated Net Tangible Assets;
(xii) the replacement, extension or renewal of any Lien permitted by
clause (iii), (iv), (v), (vii) or (xi) above upon or in the same property
theretofore subject thereto and, if such Lien secured Debt, upon the
incurrence of any Permitted Refinancing Debt in respect of such Debt secured
to the extent such Permitted Refinancing Debt is incurred in accordance with
Section 5.02(b);
(xiii) subject to the PNC Control Agreement, Liens granted in favor of
PNC Bank, National Association on cash, checks, deposit accounts, securities
accounts and Cash Equivalents of the Borrower or its Subsidiaries held by PNC
Bank, National Association from time to time to secure Debt permitted to be
incurred under Section 5.02(b)(xx);
(xiv) Liens upon or in pollution control equipment at the ▇▇▇▇▇▇▇▇'▇
Ferry Facility, the ▇▇▇▇▇▇▇▇▇ Facility or the Fort ▇▇▇▇▇▇ Facility to secure
Debt permitted to be incurred pursuant to Section 5.02(b)(xxiv) incurred
solely to finance the acquisition and installation of such pollution control
equipment, or extensions, renewals or replacements of any of the foregoing
for the same or a lesser amount; provided, however, that (A) such Lien is
incurred and the Debt secured thereby is created within 90 days after the
completion of the installation thereof, and (B) no such Lien shall extend to
or cover any property, physical asset or equipment other than such pollution
control equipment and other immaterial related Assets; and provided further
that the aggregate principal amount of the Debt secured by Liens permitted by
this clause (xiv) shall not exceed the amount permitted under Section
5.02(b)(xxiv) at any time outstanding;
(xv) prior to the Collateral Release Date, Permitted Second Priority
Liens; and
(xvi) on or after the Collateral Release Date, Liens securing Commodity
Hedge Agreements.
(b) Debt. Create, incur, assume or suffer to exist, or permit any
Material Subsidiary to create, incur, assume or suffer to exist, any Debt,
except:
(i) Debt of the Borrower under the Financing Documents;
(ii) Surviving Debt;
(iii) prior to the Initial Borrowing, the Existing Debt;
(iv) unsecured or secured Debt of the Borrower in an aggregate amount
principal amount, when combined with the aggregate principal amount of Debt
incurred pursuant to Section 2.16, not to exceed $200,000,000 at any time
outstanding;
(v) unsecured Debt owed to the Parent, the Borrower or any Subsidiary
of the Borrower so long as such Debt is subordinated to the Advances in
accordance with the Affiliate Subordination Terms;
(vi) Debt in respect of Hedge Agreements (including Commodity Hedge
Agreements) as may be entered into in the ordinary course of business and
consistent with prudent business practice to hedge or mitigate (A) risks to
which the Borrower or any Subsidiary is exposed in the conduct of its
business or the management of its liabilities as a result of fluctuations in
the prices of transmission, capacity or energy (or of any fuel required for
the generation thereof), Emissions Credits, or energy attributes or (B) risks
in respect of interest rate fluctuations; provided that in each case such
Hedge Agreement shall not have been entered into for speculative purposes;
(vii) Debt incurred by the Borrower or any Material Subsidiary to
finance all or any part of the acquisition, construction or improvement of
any real property, physical assets or equipment (including Capital
Expenditures) of the Borrower and any Subsidiary; provided that such Debt is
incurred prior to or within 90 days after such acquisition or the completion
of construction or completion of improvement or such Capital Expenditures;
provided further that the aggregate principal amount of Debt permitted under
this Section 5.02(b)(vii), when combined with the aggregate principal amount
of Debt incurred in connection with Capitalized Leases permitted under
Section 5.02(b)(viii) shall not exceed (A) prior to the Collateral Release
Date, $100,000,000 and (B) on or after the Collateral Release Date,
$500,000,000, in each case, at any time outstanding;
(viii) Capitalized Leases in an aggregate principal amount, when
combined with the aggregate principal amount of all Debt incurred pursuant to
Section 5.02(b)(vii), not in excess of (A) prior to the Collateral Release
Date, $100,000,000 and (B) on or after the Collateral Release Date,
$500,000,000, in each case, at any time outstanding;
(ix) Debt of any Person that is merged into or consolidated with the
Borrower or any Material Subsidiary; provided that (A) such Debt is existing
at the time of such merger or consolidation (other than Debt incurred solely
in contemplation of such merger or consolidation), and (B) immediately after
giving effect to such merger or consolidation, no Default shall have occurred
and be continuing;
(x) Debt arising from the honoring by a bank or financial institution
of a check, draft or similar instrument inadvertently (except in the case of
daylight overdrafts) drawn against insufficient funds in the ordinary course
of business, so long as such Debt is covered within five Business Days;
(xi) Debt in respect of workers' compensation claims, self-insurance
obligations, bankers' acceptance and performance and surety bonds provided by
the Borrower or any of its Subsidiaries in the ordinary course of business;
(xii) Debt that may be deemed to arise as a result of agreements of the
Borrower or any Material Subsidiary providing for indemnification, adjustment
of purchase price or any similar obligations, in each case, incurred in
connection with the sale or disposition of any business, Assets or Equity
Interests in any Subsidiary of the Borrower consummated not in contravention
of the terms of Section 5.02(d) in an amount not to exceed with respect to
any such sale or disposition the amount of gross proceeds received by the
Borrower in connection with such sale or disposition;
(xiii) Debt of the Borrower represented by letters of credit, surety
bonds, Contingent Obligations and performance bonds supporting obligations of
the Borrower or any of its Subsidiaries in the ordinary course of business;
(xiv) reimbursement obligations owed to Affiliates for amounts paid on
behalf of the Borrower or any of its Subsidiaries by the Parent or any of the
Parent's Subsidiaries in accordance with Applicable Laws with respect to the
provision of goods or services to the Borrower or any such Subsidiary;
(xv) unsecured Debt of the Borrower and the Material Subsidiaries not
to exceed $100,000,000 at any time outstanding;
(xvi) unsecured Debt in respect of obligations of the Borrower or any
of its Subsidiaries to pay the deferred purchase price of goods or services
or progress payments in connection with such goods and services; provided
that with respect to any material invoice, such obligations are (A) incurred
in connection with open accounts extended by suppliers on customary trade
terms (which require that all such payments be made within 90 days of the
incurrence of the related Debt) in the ordinary course of business and not in
connection with the borrowing of money and (B) (I) not more than 90 days past
due or (II) subject to any Contest, provided that the aggregate principal
amount of such Debt subject to Contest shall not exceed $15,000,000;
(xvii) Permitted Refinancing Debt incurred in respect of any Debt
permitted under clauses (i), (ii), (iii), (iv), (vii), (viii), (ix), (xv),
(xxi) and (xxiv) or this clause (xvii);
(xviii) unsecured Debt for Borrowed Money of the Borrower and the
Material Subsidiaries incurred in the ordinary course of business, maturing
within one year from the date incurred, and aggregating not more than
$20,000,000 at any one time outstanding;
(xix) additional unsecured Debt for Borrowed Money issued or incurred
the proceeds of which are used to make Capital Expenditures required to be
made in order to comply with Applicable Law regarding the environment or the
transmission of electricity or natural gas; provided that (A) the scheduled
maturity date for such Debt is a date that is at least six calendar months
after the Final Maturity Date and does not require any scheduled amortization
or mandatory prepayments thereof prior to such date, (B) such Debt contains
covenants and events of default which, taken as a whole, are determined in
good faith by a Responsible Officer of the Borrower to be no less favorable
to the Borrower or any Material Subsidiary in any material respect than the
covenants and Events of Default applicable under this Agreement, (C) no
Default shall have occurred and be continuing, and (D) prior to the
incurrence or issuance of such Debt, the Borrower shall have delivered to the
Administrative Agent a certificate demonstrating pro forma compliance with
the covenants set forth in Section 5.03 for the period of four consecutive
fiscal quarters ending on the last date of the last completed fiscal quarter
immediately preceding the proposed date of incurrence of such Debt (on the
assumption that such incurrence of Debt under this clause occurred on the
first day of such four fiscal quarter period and using historical results of
the Borrower and its Subsidiaries for such period);
(xx) secured or unsecured Debt owed to PNC Bank, National Association
from time to time in connection with the extension of credit to the Borrower
or the Material Subsidiaries for the account of one or more employees or
departments of the Borrower or its Affiliates in respect of costs and
expenses incurred by such employees or departments in connection with the
conduct of business on behalf of the Borrower or its Subsidiaries in an
aggregate principal amount not to exceed $10,000,000 at any one time
outstanding;
(xxi) Debt of the Borrower or the Material Subsidiaries in an aggregate
principal amount not to exceed $86,000,000 at any one time outstanding
incurred in connection with the assumption or refinancing of Pollution
Control Bonds in connection with a Permitted Asset Swap;
(xxii) unsecured Debt incurred by the Borrower or the Material
Subsidiaries in connection with the Buffalo Reserve Project or any Joint
Ventures in an aggregate principal amount not to exceed $75,000,000 at any
time outstanding; provided that such Debt has a scheduled maturity date that
is at least six calendar months later than the Final Maturity Date and does
not require any scheduled amortization or mandatory prepayments thereof prior
to such date;
(xxiii) unsecured Debt of the Borrower or the Material Subsidiaries
under the Parent Credit Agreement; and
(xxiv) Debt incurred to finance all or any part of the acquisition and
installation of pollution control equipment at the ▇▇▇▇▇▇▇▇'▇ Ferry Facility
or the ▇▇▇▇▇▇▇▇▇ Facility or the Fort ▇▇▇▇▇▇ Facility; provided that such
Debt is incurred prior to or within 90 days after the completion of
installation of such pollution control equipment; provided further that the
aggregate principal amount of Debt permitted under this Section 5.02(b)(xxiv)
with respect to (A) the ▇▇▇▇▇▇▇▇'▇ Ferry Facility shall not exceed
$400,000,000 at any time outstanding and (B) the ▇▇▇▇▇▇▇▇▇ Facility shall not
exceed $100,000,000 at any time outstanding and (C) the Fort ▇▇▇▇▇▇ Facility
shall not exceed $350,000,000 at any time outstanding.
(c) Mergers, Etc. Merge into or consolidate with any Person or permit
any Person to merge into it, or permit any of its Subsidiaries to do so,
except that:
(i) any Subsidiary of the Borrower may merge into or consolidate with
the Borrower so long as the Borrower is the surviving Person following such
merger or consolidation;
(ii) any Subsidiary of the Borrower may merge into or consolidate with
another Subsidiary of the Borrower; provided that if any such Subsidiary is a
Material Subsidiary or a direct or indirect wholly owned Subsidiary of the
Borrower, the surviving Person following such merger or consolidation shall
be a Material Subsidiary or a direct or indirect wholly owned Subsidiary of
the Borrower, as the case may be;
(iii) in connection with any sale, transfer or other disposition
permitted under Section 5.02(d) (other than Section 5.02(d)(i)(C)), any
Subsidiary of the Borrower may merge into or consolidate with any other
Person or permit any other Person to merge into or consolidate with it;
(iv) in connection with any acquisition permitted under Section
5.02(e), any Subsidiary may merge into the Borrower;
(v) the Borrower may merge into or otherwise consolidate with another
Person if either (A) the Borrower is the surviving entity or (B) (1) the
surviving entity is organized or existing under the laws of the United
States, any state thereof or the District of Columbia, (2) the surviving
entity assumes all of the Borrower's Obligations under the Financing
Documents pursuant to agreements reasonably satisfactory to the
Administrative Agent and (3) the Public Debt Ratings of the surviving entity
immediately following such merger or consolidation shall be no worse than the
Public Debt Ratings of the Borrower immediately prior to such merger or
consolidation;
provided, however, that in each case, immediately after giving effect thereto,
no event shall occur and be continuing that constitutes a Default.
(d) Sales, Etc., of Assets. (i) Prior to the Collateral Release Date,
sell, lease, transfer or otherwise dispose of, or permit any of its Subsidiaries
to sell, lease, transfer or otherwise dispose of, any Assets or grant any option
or other right to purchase, lease or otherwise acquire any Assets other than:
(A) the sale, transfer, lease or other disposition of or grant
of any option or other right to purchase, lease or otherwise acquire
power, capacity, the right to transmit electricity or natural gas,
fuel, fuel storage and processing, energy attributes and other products
and services and Cash Equivalents in the ordinary course of business
and any sale, lease or other disposition of or grant of any option or
other right to purchase, lease or otherwise acquire damaged, surplus,
worn-out or obsolete Assets in the ordinary course of business;
(B) the sale, transfer or other disposition of or grant of any
option or other right to purchase, lease or otherwise acquire any
Emissions Credits; provided that to the extent such sale, transfer or
other disposition of or grant of any option or other right to purchase,
lease or otherwise acquire Emissions Credits (1) is other than in the
ordinary course of business or (2) is in the ordinary course of
business but results in Net Cash Proceeds to the Borrower or the
Material Subsidiaries in excess of $100,000,000 in the aggregate from
all such sales, transfers or other dispositions of or grant of any
option or other right to purchase, lease or otherwise acquire Emission
Credits in any Fiscal Year, the Net Cash Proceeds therefrom shall be
required to be applied to prepay the Advances in accordance with the
provisions of Section 2.06(b);
(C) transactions permitted under Section 5.02(c);
(D) sales, transfers, leases or other dispositions of Assets
or Equity Interests among the Borrower and its Subsidiaries; provided,
however that, prior to the Collateral Release Date, the Borrower shall
not sell, transfer, lease or otherwise dispose of generating facilities
in excess of $500,000,000 in book value in the aggregate (which amount
shall not include any sales, transfers, leases or other dispositions of
Assets or Equity Interests in a Permitted Asset Swap permitted under
Section 5.02(d)(i)(I)) to Subsidiaries that are not Material
Subsidiaries;
(E) sales, transfers, leases or other dispositions of or grant
of any option or other right to purchase, lease or otherwise acquire
Assets; provided that (1) the consideration received by the Borrower
and its Subsidiaries for such Asset shall have been determined on the
basis of an arm's-length negotiation with non-Affiliates, (2) with
respect to any Asset or property for which consideration received by
the Borrower or any Subsidiary is in excess of $25,000,000, the
consideration received shall be at least the Fair Market Value for such
Asset or property and, if the consideration to be received with respect
to such Asset or property is equal to or greater than $100,000,000, the
Borrower shall have delivered to the Administrative Agent an Officer's
Certificate certifying that such sale, transfer, lease or other
disposition or grant of any option or other right to purchase, lease or
otherwise acquire is for Fair Market Value, accompanied by a resolution
of the Board of Directors of the Borrower pursuant to which the Board
of Directors of the Borrower shall have concluded that such sale,
transfer, lease or other disposition is for Fair Market Value which
conclusion shall be supported by an appraisal or fairness opinion
addressed to the Board of Directors from a Person other than an
Affiliate of the Borrower which supports the conclusion that such sale,
transfer or other disposition is for Fair Market Value, (3) no less
than 75% of the purchase price (excluding the amount of any Debt
assumed in connection with any such sale or other disposition by a
Person other than the Borrower or such Subsidiary ) for such Asset
shall be paid to the Borrower and the Subsidiaries solely in cash or
Cash Equivalents, (4) no portion of the non-cash proceeds received by
the Borrower and the Subsidiaries shall consist of Debt of, or Equity
Interests in, the Borrower or any of its Subsidiaries, (5) no Default
shall have occurred and be continuing, (6) on or prior to such sale,
transfer or disposition, (I) all Debt (other than under this Agreement)
of the Borrower and its Subsidiaries secured by such Asset required by
the terms thereof to be prepaid or repaid upon such sale, transfer or
disposition shall have been so paid and (II) the relevant portion of
the proceeds thereof required to be applied to the prepayment of
Advances shall have been applied in accordance with the terms contained
in the proviso at the end of this Section 5.02(d)(i), and (7) the
Borrower would be in compliance with the covenants set forth in Section
5.03 as of the most recently completed period ending prior to such
transaction for which financial statements and certificates required by
Section 5.04(b) or 5.04(c) were required to have been delivered, in
each case after giving effect to such transaction and to any other
event occurring during such period as to which pro forma recalculation
is reasonably appropriate (including any other transaction described in
this clause occurring after such period) as if such transaction (and
the repayment of any Debt in connection therewith) had occurred as of
the first day of such period;
(F) sales, transfers, leases or other dispositions of, or
grant of any option or other right to purchase, lease or otherwise
acquire, other immaterial Assets (other than Equity Interests in, or
Debt or other Obligations of, any Subsidiary) in the ordinary course of
business and on reasonable terms, if no Default exists at the time of
such sale, transfer or other disposition or grant of any option or
other right to purchase, lease or otherwise acquire;
(G) sales, transfers, leases or other dispositions of, or
grant of any option or other right to purchase, lease or otherwise
acquire, Excluded Asset and so long as any entity the Equity Interests
of which constitutes any Excluded Assets, the dissolution or
liquidation of any such entity;
(H) sales or transfers of Equity Interests in the Parent to
any Plan;
(I) sale, transfer, lease, swap, exchange or other disposition
of, or grant of any option or other right to purchase, lease or
otherwise acquire, Assets, including full or partial ownership
percentages of the Borrower and its Subsidiaries' various generating
facilities (including AGC and Bath County) or any Assets used in
connection with or related to such generating facilities, including
generating equipment, power, contract rights, permits, licenses and
other intangibles, between the Borrower or any of its Subsidiaries and
MPC or any of its Subsidiaries; provided that (1) such any such sale,
transfer, lease, swap, exchange or other disposition shall be such that
the fair market value (as determined by reference to the PA Report, if
applicable) and cash flow characteristics of the generating facilities
or ownership percentages therein, together with related Assets, sold,
transferred, leased, swapped, exchanged or disposed of by the Borrower
and its Subsidiaries shall be no less than the fair market value (as
determined by reference to the PA Report, if applicable) and cash flow
characteristics of the generating facilities or ownership percentages
therein, together with related Assets, sold, transferred, leased or
disposed of by MPC and its Subsidiaries or (2) if the Borrower and its
Subsidiaries receive less than equivalent fair market value (as
determined by reference to the PA Report, if applicable) for any Assets
sold, transferred, leased, swapped, exchanged or otherwise disposed of,
then (x) as a result of all such Asset sales, transfers, leases, swaps,
exchanges or other dispositions, taken as a whole, the Borrower and its
Subsidiaries shall receive Assets with a fair market value (as
determined by reference to the PA Report, if applicable) in an amount
not less than the fair market value (as determined by reference to the
PA Report, if applicable) less $500,000,000 of all Assets sold,
transferred, leased, swapped, exchanged, or otherwise disposed of out
of the Borrower and its Subsidiary, (y) the PEC Service Agreement shall
have been either terminated, amended to reflect market rates or
assigned by the Borrower to a third party (other than a Subsidiary of
the Borrower) that assumes the entirety of the Borrower's obligations
thereunder and (z) the Borrower shall have delivered to the
Administrative Agent (I) a certificate signed by the Chief Financial
Officer of the Borrower certifying that (aa) after giving effect to
such sales, transfers, leases, swaps, exchanges or other dispositions,
any decrease in the fair market value of the Assets (determined at the
time thereof) held by the Borrower and its Subsidiaries as a result of
such sales, transfers, leases, swaps, exchanges or other dispositions
will be offset by the net present value of the impact of the
termination, amendment or assignment of the PEC Service Agreement
(except for any de minimis loss of value to the Borrower and its
Subsidiaries) and (bb) the cumulative cash flow effect on the Borrower
and its Subsidiaries of all such sales, transfers, leases, swaps,
exchanges or other dispositions (determined at the time thereof) over
the period from the date of any such sale, transfer, lease, swap,
exchange or other disposition, as applicable, until June 30, 2011 shall
not be negative and (II) a schedule in form reasonably satisfactory to
the Administrative Agent of the computations used by the Chief
Financial Officer in support of the statements contained in such
certificate (each such sale, transfer, lease, swap, exchange or other
disposition, a "Permitted Asset Swap");
(J) sales, transfers or other dispositions of Assets to any
Joint Venture to the extent permitted by Section 5.02(e);
(K) the issuance of any Equity Interests by (1) the Borrower
to any Person or (2) any Subsidiary of the Borrower; and
(L) the sale, transfer, lease or other disposition of the AGC
Transmission Line;
provided that in the case of sales, transfers or other dispositions of Assets
pursuant to clause (B) (but only to the extent contemplated thereby), (E) or (F)
above prior to the Collateral Release Date, the Net Cash Proceeds from such
sale, transfer or disposition due to the Borrower and its Subsidiaries shall be
received by the Borrower and its Subsidiaries in one or more Controlled
Accounts, and the Borrower shall prepay the Advances in accordance with Section
2.06(b).
(ii) On or after the Collateral Release Date, the Borrower
will not, at any time, sell, lease, transfer or otherwise dispose of,
or permit any of its Subsidiaries to sell, lease, transfer or otherwise
dispose of, any Assets to any Person other than the Borrower and its
Subsidiaries, or grant any option or other right to purchase, lease or
otherwise acquire any Assets to any Person other than the Borrower and
its Subsidiaries, other than (A) in an amount not to exceed (1) 10% of
the value of all Assets of the Borrower and its Subsidiaries in any
Fiscal Year and (2) 25% of such value in the aggregate or (B) sales,
leases, transfers and other dispositions permitted under clause (i)
above.
(e) Investments in Other Persons. Prior to the Collateral Release Date,
make or hold, or permit any Material Subsidiary to make or hold, any Investment
in any Person, except:
(i) (A) equity Investments outstanding as of the date hereof by the
Borrower and the Material Subsidiaries in their Subsidiaries or Affiliates,
(B) equity Investments after the date hereof by the Borrower and Material
Subsidiaries in any Subsidiary of the Borrower or Affiliates, and (C)
Investments after the date hereof in direct or indirect Subsidiaries of the
Borrower consisting of intercompany Debt permitted under Section 5.02(b)(v);
(ii) loans and advances to employees in the ordinary course of business
of the Borrower and its Subsidiaries as presently conducted in an aggregate
amount not to exceed $2,000,000 at any time outstanding;
(iii) Investments in Cash Equivalents;
(iv) Investments in Hedge Agreements and Commodity Hedge Agreements
permitted pursuant to Section 5.02(b)(vi);
(v) Investments in Subsidiaries of the Borrower resulting from drawings
under, or renewals or extensions of, letters of credit, surety bonds,
Contingent Obligations or performance bonds supporting obligations of
Subsidiaries incurred in the ordinary course of business but in any event not
for speculative obligations of such Subsidiary;
(vi) Investments in any non-cash proceeds received by the Borrower or
any of its Subsidiaries in connection with any sale, transfer or other
disposition of any Asset to the extent permitted under Section 5.02(d);
(vii) Investments consisting of extensions of credit in the nature of
accounts receivable or notes receivable arising from the grant of trade
credit in the ordinary course of business, and Investments received in
satisfaction or partial satisfaction thereof from financially troubled
account debtors to the extent reasonably necessary in order to prevent or
limit loss;
(viii) Investments not otherwise permitted under this Section 5.02(e)
in an aggregate amount not to exceed $100,000,000 plus an amount equal to (A)
the Net Cash Proceeds in respect of any sale or issuance, after the Closing
Date, of any Equity Interests by the Borrower or sale, transfer or other
disposition, after the Closing Date, of Assets retained by the Borrower or
the Material Subsidiaries in accordance with Section 2.06 and not applied to
prepay Debt plus (B) the Net Cash Proceeds in respect of any sale or issuance
of any Equity Interests by the Borrower or any sale, transfer or other
disposition of Assets applied by the Borrower to voluntarily prepay the
Advances pursuant to Section 2.06(a); provided that with respect to each
Investment made pursuant to this Section 5.02(e)(viii): (1) to the extent any
such Investment constitutes Equity Interests in, or Debt of, any Material
Subsidiary held by the Borrower or any of its Subsidiaries, the Borrower
shall have complied with its obligations under Section 5.01(m) and such
Equity Interests or Debt, as the case may be, shall be subject to the terms
of the Security Agreement and the pledge or security agreement referred to in
Section 5.01(m)(ii), as applicable; (2) such Investment shall not include or
result in any contingent liabilities that could reasonably be expected to be
material to the business, financial condition, operations or prospects of the
Borrower and its Subsidiaries, taken as a whole (as determined in good faith
by the Board of Directors (or persons performing similar functions) of the
Borrower or such Subsidiary if the Board of Directors is otherwise approving
such transaction and, in each other case, by a Responsible Officer); (3) such
Investment shall be in Assets which are part of, or in lines of business
which are in or reasonably related to, the electric power generation,
transmission, distribution and/or energy trading businesses; (4) any
determination of the amount of such Investment shall include all cash and
noncash consideration (including the fair market value of all Equity
Interests issued or transferred to the sellers thereof, all indemnities,
earnouts and other contingent payment obligations to, and the aggregate
amounts paid or to be paid under noncompete, consulting and other affiliated
agreements with, the sellers thereof, all write-downs of Assets and reserves
for liabilities with respect thereto and all assumptions of debt, liabilities
and other obligations in connection therewith) paid by or on behalf of the
Borrower and its Subsidiaries in connection with such Investment; and (5) (I)
immediately before and giving pro forma effect to any such purchase or other
acquisition, no Default shall have occurred and be continuing and (II)
immediately after giving effect to such purchase or other acquisition, the
Borrower and its Subsidiaries shall be in pro forma compliance with all of
the covenants set forth in Section 5.03, such compliance to be determined on
the basis of the financial information most recently delivered to the
Administrative Agent pursuant to Section 5.04(b) or 5.04(c) as though such
Investment had been consummated as of the first day of the fiscal period
covered thereby; (ix) Investments not otherwise permitted under this Section
5.02(f) existing on the Closing Date;
(x) Investments in the Buffalo Reserve Project or any Joint Venture in
an aggregate amount not to exceed $75,000,000;
(xi) Investments consisting of Debt owed to the Borrower or its
Subsidiaries under the AYE Money Pool; and
(xii) Investments consisting of any repurchase, redemption,
cancellation, termination or other acquisition or extinguishment of Debt of
the Borrower or its Subsidiaries, by the Borrower or by the Material
Subsidiaries, in an aggregate amount not to exceed $50,000,000 provided that
after giving effect thereof, the Borrower is in pro forma compliance with the
covenants set forth in Section 5.03;
provided that this Section 5.02(e) shall not prohibit (A) any repurchase of Debt
of the Borrower by the Borrower or Debt of any Material Subsidiary by such
Material Subsidiary to the extent such repurchase is not otherwise prohibited by
the other provisions in this Agreement and (B) any purchase or acquisition of
Assets in a Permitted Asset Swap in accordance with Section 5.02(d)(i)(I).
(f) Restricted Payments. Declare or pay any dividend, purchase, redeem,
retire, defease or otherwise acquire for value any of its Equity Interests now
or hereafter outstanding, return any capital to its stockholders, partners or
members (or the equivalent Persons thereof) as such, make any distribution of
Assets, Equity Interests (other than Equity Interests in the Borrower issued to
the Parent) or obligations or securities to its stockholders, partners or
members (or the equivalent Persons thereof) as such or issue or sell any Equity
Interests in it other than to the Parent or accept any capital contributions
other than capital contributions made by the Parent to the Borrower or made with
respect to the ML Interest, or permit any of its Subsidiaries to do any of the
foregoing, or permit any of its Subsidiaries to purchase, redeem, retire,
defease or otherwise acquire for value any Equity Interest in the Borrower or to
issue or sell any Equity Interests therein, except that so long as no Default
shall have occurred and be continuing at the time of any action described in
clause (i), (ii), (iii) or (iv) below or would result therefrom:
(i) the Borrower may (A) declare and pay cash dividends and
distributions with respect to the ML Interests to the extent required under
the Constituent Documents of the Borrower as in effect on the Closing Date,
(B) make payments to the Parent in respect of reimbursement obligations under
any drawn letter of credit posted by the Parent on behalf of the Borrower or
any of its Subsidiaries to support Obligations of the Borrower or such
Subsidiary undertaken in the ordinary course of business and not for
speculative purposes, (C) issue and sell shares of its Equity Interests, (D)
commencing with the Fiscal Year ending December 31, 2006, declare and pay
cash dividends to the Parent in an aggregate amount in any Fiscal Year not to
exceed the greater of (1) $25,000,000 or (2) if the Borrower's Leverage Ratio
as of the last day of the Fiscal Year immediately preceding the Fiscal Year
in which such dividend is paid was less than (I) 4.50:1.00, 25% of the
Borrower's Consolidated Net Income for the Fiscal Year immediately preceding
the Fiscal Year in which such dividend is paid or (II) 3.50:1.00, 50% of the
Borrower's Consolidated Net Income for the Fiscal Year immediately preceding
the Fiscal Year in which such dividend is paid, and (E) make any equity
Investment in any of its Subsidiaries permitted under Section 5.02(e);
(ii) any Subsidiary of the Borrower may (A) declare and pay cash
dividends or distributions ratably to the holders of its Equity Interests,
including the Borrower or any other Subsidiary of the Borrower, (B) accept
capital contributions from its parent to the extent not in contravention of
Section 5.02(e)(i) or 5.02(e)(vi) and (C) make any equity Investment in any
of its Subsidiaries not in contravention of Section 5.02(e);
(iii) the Borrower or any Subsidiary of the Borrower may sell, transfer
or contribute any Equity Interests in the Parent to any Plan; and
(iv) the Borrower or any Subsidiary of the Borrower may sell, transfer
or contribute any Equity Interests in any of its respective Subsidiaries in
connection with a Permitted Asset Swap.
(g) Payment Restrictions Affecting the Borrower's Subsidiaries. Enter
into, incur or permit to exist any agreement or other arrangement that prohibits
or restricts the ability of any of its Subsidiaries to declare or pay any
dividend or other distribution in respect of its Equity Interests or repay or
prepay any Debt owed to, make loans or advances to, or otherwise invest in, the
Borrower or any of its Subsidiaries; provided that the foregoing shall not apply
to restrictions and conditions imposed by (A) Applicable Law, (B) the Financing
Documents, (C) the terms of any Surviving Debt as in effect on the date hereof
or any Permitted Refinancing Debt incurred in connection therewith, (D) any
agreement in effect with respect to any Subsidiary at the time such Subsidiary
becomes a Subsidiary of the Borrower, so long as such agreement was not entered
into solely in contemplation of such Person becoming a Subsidiary of the
Borrower, (E) any negative pledge incurred or provided in favor of any holder of
Debt permitted under Section 5.02(b)(vii) solely to the extent any such negative
pledge relates to the property financed by or subject of such Debt or any
Permitted Refinancing Debt incurred in connection therewith, (F) any agreement
for the sale or disposition of Assets permitted under Section 5.02(d), provided
that such restrictions and conditions apply only to the Asset that is to be sold
or the proceeds thereof, (G) any trading, netting, operating, construction,
service, supply, purchase, sale or similar agreement to which the Borrower or
any of its Subsidiaries is a party, entered into in the ordinary course of
business; provided that such agreement prohibits the encumbrance of solely the
Assets of the Borrower or such Subsidiary that are the subject of that
agreement, the payment rights arising thereunder and/or the proceeds thereof and
not of any other Asset of the Borrower or such Subsidiary or the Assets of any
other Subsidiary, (H) customary provisions restricting subletting or assignment
of leases or customary provisions in other agreements that restrict assignment
of such agreements or rights thereunder, which restrictions, when taken as a
whole, as determined in good faith by a Responsible Officer of the Borrower, are
no more restrictive than any similar restrictions in effect on the Closing Date,
(I) any negative pledge provided for in any Joint Venture agreements,
stockholder or partnership agreements or organizational documents relating to
Joint Ventures or partnerships or agreements including the Buffalo Reserve
Project, (J) any such restrictions or limitations contained in any other
agreement in effect on the Closing Date and any amendments, modifications,
restatements, renewals or replacements thereof that are not materially more
restrictive, taken as a whole, as determined in good faith by a Responsible
Officer of the Borrower, than the restrictions or limitations in effect on the
Closing Date, (K) any such restrictions or limitations contained in any
agreement evidencing Debt permitted under Section 5.02(b)(xxiii) or any
Permitted Refinancing Debt incurred in connection therewith but solely to the
extent that such restrictions or limitations are contained in the agreement
evidencing the relevant Pollution Control Bonds as of the date hereof and (J)
any negative pledge incurred or provided in favor of any holder of Debt
permitted under Section 5.02(b)(xxiv) but solely to the extent such negative
pledge relates to the property financed by or subject of such Debt and any other
such restrictions or limitations contained in any agreement evidencing such Debt
and applicable solely to the relevant Subsidiary of the Borrower obtaining such
Debt, so long as such negative pledge or other such restrictions or limitations
are customary for similar transactions as of the date of such financing as
determined in good faith by a Responsible Officer of the Borrower.
SECTION 5.03. Financial Covenants. The Borrower covenants and agrees
that on and after the date hereof and until the Notes, together with all accrued
interest thereon, fees and all other Senior Debt Obligations (other than
contingent indemnification obligations not yet due and payable) are paid in full
and all Commitments and each Letter of Credit shall have terminated, it will
not:
(a) Interest Coverage Ratio. Permit the Interest Coverage Ratio at the
end of any fiscal quarter to be less than the ratio set forth for such fiscal
quarter below:
----------------------------------- -------------------------------
Four Fiscal Ratio
Quarters Ending
----------------------------------- -------------------------------
June 30, 2006 1.75:100
----------------------------------- -------------------------------
September 30, 2006 2.00:1.00
----------------------------------- -------------------------------
December 31, 2006 2.00:1.00
----------------------------------- -------------------------------
March 31, 2007 2.10:1.00
----------------------------------- -------------------------------
June 30, 2007 2.10:1.00
----------------------------------- -------------------------------
September 30, 2007 2.10:1.00
----------------------------------- -------------------------------
December 31, 2007 2.25:1.00
----------------------------------- -------------------------------
March 31, 2008 2.50:1.00
----------------------------------- -------------------------------
June 30, 2008 2.60:1.00
----------------------------------- -------------------------------
September 30, 2008 2.70:1.00
----------------------------------- -------------------------------
December 31, 2008 2.80:1.00
----------------------------------- -------------------------------
March 31, 2009 3.00:1.00
----------------------------------- -------------------------------
June 30, 2009 3.00:1.00
----------------------------------- -------------------------------
September 30, 2009 3.00:1.00
----------------------------------- -------------------------------
December 31, 2009 3.00:1.00
----------------------------------- -------------------------------
March 31, 2010 3.00:1.00
----------------------------------- -------------------------------
June 30, 2010 3.00:1.00
----------------------------------- -------------------------------
September 30, 2010 3.00:1.00
----------------------------------- -------------------------------
December 31, 2010 3.00:1.00
----------------------------------- -------------------------------
March 31, 2011 3.00:1.00
----------------------------------- -------------------------------
(b) Leverage Ratio. Permit the Leverage Ratio as of any fiscal quarter
to be greater than the ratio set forth below for each fiscal quarter set forth
below:
------------------------------------ -------------------------------
Four Fiscal Ratio
Quarters Ending
------------------------------------ -------------------------------
June 30, 2006 7.50:1.00
------------------------------------ -------------------------------
September 30, 2006 7.25:1.00
------------------------------------ -------------------------------
December 31, 2006 7.00:1.00
------------------------------------ -------------------------------
March 31, 2007 6.50:1.00
------------------------------------ -------------------------------
June 30, 2007 6.25:1.00
------------------------------------ -------------------------------
September 30, 2007 6:00:1.00
------------------------------------ -------------------------------
December 31, 2007 6:00:1.00
------------------------------------ -------------------------------
March 31, 2008 5.50:1.00
------------------------------------ -------------------------------
June 30, 2008 5.25:1.00
------------------------------------ -------------------------------
September 30, 2008 5.00:1.00
------------------------------------ -------------------------------
December 31, 2008 4.50:1.00
------------------------------------ -------------------------------
March 31, 2009 4.50:1.00
------------------------------------ -------------------------------
June 30, 2009 4.50:1.00
------------------------------------ -------------------------------
September 30, 2009 4.50:1.00
------------------------------------ -------------------------------
December 31, 2009 4.50:1.00
------------------------------------ -------------------------------
March 31, 2010 4.00:1.00
------------------------------------ -------------------------------
June 30, 2010 4.00:1.00
------------------------------------ -------------------------------
September 30, 2010 4.00:1.00
------------------------------------ -------------------------------
December 31, 2010 4.00:1.00
------------------------------------ -------------------------------
March 31, 2011 4.00:1.00
------------------------------------ -------------------------------
SECTION 5.04. Reporting Covenants. The Borrower covenants and agrees
that until the Notes, together with all accrued interest thereon, fees and all
other Senior Debt Obligations are paid in full and all Commitments and each
Letter of Credit shall have terminated, the Borrower will furnish to the
Administrative Agent and each Lender Party (it being understood that delivery to
the Administrative Agent for posting by the Administrative Agent of each of the
following items on a electronic website shall constitute delivery to each Lender
Party by the Borrower, and the Administrative Agent hereby agrees to post on an
electronic website or otherwise distribute to the Lender Parties any such item
delivered by the Borrower to the Administrative Agent):
(a) Default Notices. As soon as possible and in any event within five
Business Days after any Responsible Officer of the Borrower becomes aware of the
occurrence of any Default continuing on the date of such statement, a statement
of a Responsible Officer of the Borrower setting forth the details of such
Default or event, development or occurrence and, in each case, the actions, if
any, which the Borrower has taken and proposes to take with respect thereto.
(b) Annual Financials. As soon as available and in any event within 90
days after the end of each Fiscal Year, a copy of the annual audit report for
such year for the Borrower and its Subsidiaries including therein a Consolidated
balance sheet of the Borrower and its Subsidiaries as of the end of such Fiscal
Year and Consolidated statement of income and a Consolidated statement of cash
flows of the Borrower and its Subsidiaries for such Fiscal Year, in each case
accompanied by a report that is unqualified or is otherwise reasonably
acceptable to the Required Lenders of Pricewaterhouse Coopers (or such other
independent public accountants of recognized standing acceptable to the Required
Lenders), together with (i) a certificate of such accounting firm stating that
in the course of the regular audit of the business of the Borrower and its
Subsidiaries, which audit was conducted by such accounting firm in accordance
with generally accepted auditing standards, nothing has come to such accounting
firm's attention that would cause it to believe that the Borrower has failed to
comply with the covenants set forth in Section 5.03, (ii) a schedule in form
satisfactory to the Administrative Agent of the computations prepared by the
Borrower and used by such accounting firm in determining, as to the fourth
quarter of such Fiscal Year, compliance with the covenants contained in Section
5.03, provided that in the event of any change in GAAP used in the preparation
of such financial statements, the Borrower shall also provide, if necessary for
the determination of compliance with Section 5.03, a statement of reconciliation
conforming such financial statements to GAAP as in effect as of the Closing Date
and (iii) a certificate of the Chief Financial Officer of the Borrower stating
that no Default has occurred and is continuing or, if a default has occurred and
is continuing, a statement as to the nature thereof and the action that the
Borrower has taken and proposes to take with respect thereto.
(c) Quarterly Financials. As soon as available and in any event within
60 days after the end of each of the first three quarters of each Fiscal Year, a
Consolidated balance sheet of the Borrower and its Subsidiaries as of the end of
such quarter and a Consolidated statement of income and a Consolidated statement
of cash flows of the Borrower and its Subsidiaries for the period commencing at
the end of the previous fiscal quarter and ending with the end of such fiscal
quarter, setting forth in each case in comparative form the corresponding
figures for the corresponding date or period of the preceding Fiscal Year, all
in reasonable detail and duly certified (subject to normal year-end audit
adjustments) by the Chief Financial Officer of the Borrower as having been
prepared in accordance with GAAP, together with (i) a certificate of said
officer stating that no Default has occurred and is continuing or, if a Default
has occurred and is continuing, a statement as to the nature thereof and the
action that the Borrower has taken and proposes to take with respect thereto and
(ii) a schedule in form satisfactory to the Administrative Agent of the
computations used by the Borrower in determining compliance with the covenants
contained in Section 5.03, provided that in the event of any change in GAAP used
in the preparation of such financial statements, the Borrower shall also
provide, if necessary for the determination of compliance with Section 5.03, a
statement of reconciliation conforming such financial statements to GAAP as in
effect as of the Closing Date.
(d) Real Property. Prior to the Collateral Release Date, within 45 days
after the end of each fiscal quarter, a report supplementing Schedule 4.01(n),
identifying all Material Property disposed of by the Borrower during such fiscal
quarter, a list and description (including the street address, county or other
relevant jurisdiction, state, record owner, book value thereof and, in the case
of leases of property, lessor, lessee, expiration date and annual rental cost
thereof) of all Material Property acquired or leased by the Borrower during such
fiscal quarter ("Acquired Material Property") and a description of such other
changes in the information included in such Schedule as may be necessary for
such Schedule to be accurate and complete in respect of such Acquired Material
Property.
(e) Additional Material Subsidiaries. As soon as available, but in no
event later than five Business Days after any Responsible Officer of the
Borrower becomes aware of the same, any Subsidiary (other than AE Capital)
becoming a Material Subsidiary.
(f) Other Information. Such other information respecting the business
or properties, or the condition or operations, financial or otherwise, of the
Borrower or any of its Subsidiaries as any Agent or any Lender Party acting
through the Administrative Agent may from time to time reasonably request.
ARTICLE VI
EVENTS OF DEFAULT
SECTION 6.01. Events of Default. If any of the following events,
conditions or occurrences (each, an "Event of Default") shall occur and be
continuing:
(a) (i) the Borrower shall fail to pay any principal of any Advance or
any L/C Obligation when the same shall become due and payable or (ii) the
Borrower shall fail to pay any interest on any Advance or any L/C Obligation, or
the Borrower shall fail to make any other payment under any Financing Document,
in each case under this clause (ii) within three Business Days after the same
becomes due and payable hereunder or under any other Financing Document; or
(b) any representation, warranty, certification or statement of fact
made or deemed made by or on behalf of the Borrower herein, in any other
Financing Document, or in any document delivered in connection herewith or
therewith shall be incorrect or misleading in any material respect when made or
deemed made; or
(c) the Borrower shall fail to perform or observe any term, covenant or
agreement contained in any of Section 5.01(e), 5.02, 5.03 or 5.04(a); or
(d) prior to the Collateral Release Date, the Borrower shall fail to
perform or observe any term, covenant or agreement contained in Section 5.01(l)
in connection with a Permitted Asset Swap and such failure shall remain
unremedied for five days after the date on which a Responsible Officer of the
Borrower becomes aware of such failure; or
(e) the Borrower shall fail to perform or observe any other covenant or
agreement (not specified in Section 6.01(a), 6.01(c) or 6.01(d) above) contained
in any Financing Document on its part to be performed or observed and such
failure shall remain unremedied for (i) prior to the Collateral Release Date, 60
days after the date on which a Responsible Officer of the Borrower becomes aware
of such failure or (ii) on or after the Collateral Release Date, 30 days after
the date on which a Responsible Officer of the Borrower becomes aware of such
failure; or
(f) (i) the Borrower or any Material Subsidiary (A) fails to make any
payment when due (whether by scheduled maturity, required prepayment,
acceleration, demand, or otherwise) in respect of any Debt (other than Debt
under the Financing Documents or Debt which is subject to Contest) having an
aggregate principal amount (including undrawn committed or available amounts and
including amounts owing to all creditors under any combined or syndicated credit
arrangement) or with respect to any Hedge Agreement with an Agreement Value of
more than $40,000,000 either individually or in the aggregate or (B) fails to
observe or perform any other agreement or condition relating to any such Debt or
contained in any instrument or agreement evidencing, securing or relating
thereto, or any other event occurs, the effect of which default or other event
is to cause (1) such Debt to have been demanded, become due, repurchased,
prepaid, defeased or redeemed (automatically or otherwise), (2) an offer to
repurchase, prepay, defease or redeem such Debt to have been made, prior to its
stated maturity, or (3) cash collateral in respect thereof to have been
demanded; or (ii) there occurs under any Hedge Agreement an Early Termination
Date (as defined in such Hedge Agreement) resulting from (A) any event of
default under such Hedge Agreement as to which the Borrower or any Material
Subsidiary is the Defaulting Party (as defined in such Hedge Agreement) or (B)
any Termination Event (as so defined) under such Hedge Agreement as to which the
Borrower or any Material Subsidiary is an Affected Party (as defined in such
Hedge Agreement) and, in either event, the termination value owed by the
Borrower or any Material Subsidiary as a result thereof is greater than the
$40,000,000 either individually or in the aggregate; or
(g) any Insolvency Proceeding shall occur with respect to the Borrower
or any Material Subsidiary; or
(h) there is entered against the Borrower or any Material Subsidiary
(i) any final judgment or order for the payment of money in an amount exceeding
$40,000,000 either individually or in the aggregate other than in respect of the
▇▇▇▇▇▇▇ ▇▇▇▇▇ Litigation (to the extent not covered by independent third-party
insurance by an insurer that is rated at least "A" by A.M. Best Company and such
coverage is not the subject of a bona fide dispute), or (ii) any one or more
non-monetary final judgments that have, or could reasonably be expected to have,
individually or in the aggregate, a Material Adverse Effect and, in the case of
(i) or (ii), (y) enforcement proceedings are commenced by any creditor upon such
judgment or order and such proceedings are not stayed within 10 Business Days,
or (z) there is a period of 30 consecutive days during which a stay of
enforcement of such judgment, by reason of a pending appeal or otherwise, is not
in effect; or
(i) there occurs any Change of Control; or
(j) prior to the Collateral Release Date, any Collateral Document after
delivery thereof shall for any reason (other than pursuant to the terms thereof)
cease to create solely for the benefit of the Secured Parties (or the
enforceability thereof shall be contested by the Borrower) with respect to any
portion of the Collateral, a valid and, but for the giving of notices of Liens
thereunder to Persons other than Affiliates of the Borrower, perfected first
priority Lien on and security interest in such Collateral and in the case of any
invalidity or non-perfection of any such Lien with respect to an immaterial
portion of the Collateral as a result of administrative or ministerial errors,
such occurrence shall remain unremedied for 60 days after the earlier of the
date on which (i) a Responsible Officer of the Borrower becomes aware of such
failure or (ii) written notice thereof shall have been given to the Borrower by
the Administrative Agent or any Lender Party; or
(k) any material provision of any Financing Document shall be canceled,
terminated, declared to be null and void or shall otherwise cease to be valid
and binding on the Borrower, in each case, as determined in a final,
non-appealable judgment of a court of competent jurisdiction, or the Borrower
shall deny in writing any further liability or obligation under any provision of
any Financing Document; provided that the foregoing provisions of this clause
(k) shall not apply to any Financing Document that is canceled, terminated,
declared to be null and void or which ceases to be valid or binding on the
Borrower in accordance with its terms or by agreement of the requisite parties
thereto; or
(l) as a result of or in connection with an ERISA Event with respect to
a Plan, the Borrower or any of its Subsidiaries or any ERISA Affiliate has
incurred or is reasonably expected to incur liability in an amount exceeding, in
the aggregate with any amounts applicable under clauses (l) and (m) of this
Section 6.01, $25,000,000; or
(m) the Borrower or any of its Subsidiaries or any ERISA Affiliate
shall have been notified by the sponsor of a Multiemployer Plan that it has
incurred Withdrawal Liability to such Multiemployer Plan in an amount that, when
aggregated with all other amounts required to be paid to Multiemployer Plans by
the Borrower, its Subsidiaries and the ERISA Affiliates as Withdrawal Liability
(determined as of the date of such notification), exceeds, in the aggregate with
any amounts applicable under clauses (l) and (m) of this Section 6.01,
$25,000,000, or requires payments exceeding $25,000,000 per annum; or
(n) the Borrower or any of its Subsidiaries or any ERISA Affiliate
shall have been notified by the sponsor of a Multiemployer Plan that such
Multiemployer Plan is in reorganization or is being terminated, within the
meaning of Title IV of ERISA, and as a result of such reorganization or
termination the aggregate annual contributions of the Borrower, its Subsidiaries
and the ERISA Affiliates to all Multiemployer Plans that are then in
reorganization or being terminated have been or will be increased over the
amounts contributed to such Multiemployer Plans for the plan years of such
Multiemployer Plans immediately preceding the plan year in which such
reorganization or termination occurs by an amount exceeding, in the aggregate
with any amounts applicable under clauses (l) and (m) of this Section 6.01,
$25,000,000; or
(o) prior to the Collateral Release Date, the Borrower shall at any
time deliver or cause to be delivered to the Collateral Agent without prior
written consent of the Administrative Agent a notice pursuant to 42 Pa. C.S.A.
ss. 8143 electing to limit the indebtedness secured by any Mortgage;
then, and in any such event, the Administrative Agent (i) shall at the request,
or may with the consent, of the Required Lenders, by notice to the Borrower,
declare all or any part of the Commitments and the Incremental Commitments (if
any) of each Lender Party and the obligation of each Lender Party to make
Advances (other than a Revolving Advance by the Revolving Lenders pursuant to
Section 2.03(b) and Swing Line Advances by the Revolving Lenders pursuant to
Section 2.02(c)) and of the Issuing Banks to make L/C Credit Extensions to be
terminated, whereupon the same shall forthwith terminate, and (ii) shall at the
request, or may with the consent, of the Required Lenders, (A) (I) by notice to
the Borrower, declare all or any part of the Notes, all interest thereon and all
other amounts payable under this Agreement and the other Financing Documents
owing to the Lenders to be forthwith due and payable, whereupon the Notes, all
such interest and all such amounts shall become and be forthwith due and
payable, without presentment, demand, protest or further notice of any kind, all
of which are hereby expressly waived by the Borrower; provided that upon the
occurrence of any Event of Default described in Section 6.01(g), (1) the
Commitments of each Lender Party and the obligation of each Lender Party to make
Advances (other than a Revolving Advance by the Revolving Lenders pursuant to
Section 2.03(b) and Swing Line Advances by the Revolving Lenders pursuant to
Section 2.02(c)) and of the Issuing Banks to make L/C Credit Extensions shall
automatically be terminated and (2) the Notes, all such interest and all such
amounts shall automatically become and be due and payable, without presentment,
demand, protest or any notice of any kind, all of which are hereby expressly
waived by the Borrower, and the obligation of the Borrower to Cash Collateralize
the L/C Obligations as aforesaid shall automatically become effective, in each
case, without further act of the Administrative Agent or any Lender. SECTION
6.02. Actions in Respect of Letters of Credit upon Default. If any Event of
Default shall have occurred and be continuing, the Administrative Agent may, or
shall at the request of the Required Lenders, irrespective of whether it is
taking any of the actions described in Section 6.01 or otherwise, make demand
upon the Borrower to, and forthwith upon demand the Borrower will, Cash
Collateralize, for deposit in the Cash Collateral Account, an amount equal to
the Outstanding Amount of all L/C Obligations. If at any time the Administrative
Agent determines that any Cash Collateral is subject to any right or claim of
any Person other than the Administrative Agent and the Lender Parties or that
the Cash Collateral is less than the Outstanding Amount of all L/C Obligations,
the Borrower will, forthwith upon demand by the Administrative Agent, pay to the
Administrative Agent additional Cash Collateral to be deposited and held in the
Cash Collateral Account, in an amount equal to the excess of (a) such aggregate
Outstanding Amount of all L/C Obligations over (b) the total amount of Cash
Collateral that the Administrative Agent determines to be free and clear of any
such right and claim.
ARTICLE VII
THE ADMINISTRATIVE AGENT
SECTION 7.01. Authorization and Action. (a) Each Lender Party hereby
appoints and authorizes the Administrative Agent to (i) take such action as
agent on its behalf and to exercise such powers and discretion under this
Agreement and the other Financing Documents as are delegated to the
Administrative Agent by the terms hereof and thereof, together with such powers
and discretion as are reasonably incidental thereto, and (ii) take such actions
under the Security Agreement on behalf of the Lender Parties as provided
therein. As to any matters not expressly provided for by the Financing Documents
(including enforcement or collection of the Notes), the Administrative Agent
shall not be required to exercise any discretion or take any action, but shall
be required to act or to refrain from acting (and shall be fully protected in so
acting or refraining from acting) upon the instructions of the Required Lenders,
and such instructions shall be binding upon all Lender Parties and all holders
of Notes; provided, however, that the Administrative Agent shall not be required
to take any action that exposes the Administrative Agent to personal liability
or that is contrary to this Agreement or Applicable Law. The Administrative
Agent agrees to give to each Lender Party prompt notice of each notice given to
it by the Borrower or any other Person pursuant to the terms of this Agreement
or any other Financing Documents.
(b) Each Lender Party hereby appoints and authorizes the Collateral
Agent to take such action as agent on its behalf in accordance with the
provisions of Article VII of the Security Agreement and agrees to be bound by
the provisions of Section 7.17 of the Security Agreement.
SECTION 7.02. Reliance, Etc. Neither any Agent nor any of its
directors, officers, agents or employees shall be liable for any action taken or
omitted to be taken by it or them under or in connection with the Financing
Documents, except for its or their own gross negligence or willful misconduct.
Without limitation of the generality of the foregoing: (a) the Administrative
Agent may treat the payee of any Note as the holder thereof until the
Administrative Agent receives and accepts an Assignment and Acceptance entered
into by the Lender Party that is the payee of such Note, as assignor, and an
Eligible Assignee, as assignee, as provided in Section 8.07; (b) each Agent may
consult with legal counsel (including counsel for the Borrower), independent
public accountants and other experts selected in good faith by it and shall not
be liable for any action taken or omitted to be taken in good faith by it in
accordance with the advice of such counsel, accountants or experts; (c) each
Agent makes no warranty or representation to any Lender Party and shall not be
responsible to any Lender Party for any statements, warranties or
representations (whether written or oral) made in or in connection with the
Financing Documents; (d) each Agent shall not have any duty to ascertain or to
inquire as to the performance or observance of any of the terms, covenants or
conditions of any Financing Document on the part of the Borrower or to inspect
the property (including the books and records) of the Borrower; (e) each Agent
shall not be responsible to any Lender Party for the due execution, legality,
validity, enforceability, genuineness, sufficiency or value of, or the
perfection or priority of any lien or security interest created or purported to
be created under or in connection with, any Financing Document or any other
instrument or document furnished pursuant thereto; and (f) each Agent shall
incur no liability under or in respect of any Financing Document by acting upon
any notice, consent, certificate or other instrument or writing (which may be by
telegram, telecopy or telex) reasonably believed by it to be genuine and signed
or sent by the proper party or parties.
SECTION 7.03. CUSA, CGMI, Citibank, Scotia Capital, BAS, BofA and
Affiliates. With respect to its commitments, if any, to make loans pursuant to
its Commitment or Incremental Commitment, if any, the Advances made by it, the
L/C Credit Extensions and the Notes issued to it, CUSA, CGMI, Citibank, Scotia
Capital, BAS, and BofA shall have the same rights and powers under the Financing
Documents as any other Lender and may exercise the same as though it were not
the Administrative Agent or an Arranger Party, as applicable; and the terms
"Lender", "Lenders", "Revolving Lender", "Revolving Lenders", "Swing Line Bank",
"Term Lender" or "Term Lenders" shall, unless otherwise expressly indicated,
include each of CUSA, CGMI, Citibank, Scotia Capital, BAS, and BofA, in its
individual capacity, as applicable. CUSA, CGMI, Citibank, Scotia Capital, BAS,
and BofA, and their respective Affiliates may accept deposits from, lend money
to, act as trustee under indentures of, accept investment banking engagements
from and generally engage in any kind of business with, the Borrower, any
Subsidiary of the Borrower and any Person that may do business with or own
securities of the Borrower or any such Subsidiary, all as if CUSA, CGMI,
Citibank, Scotia Capital, BAS, and BofA, were not the Administrative Agent or an
Arranger Party, as applicable, and without any duty to account therefor to the
Lender Parties.
SECTION 7.04. Lender Party Credit Decision. Each Lender Party
acknowledges that it has, independently and without reliance upon any Agent, any
Arranger Party or any other Lender Party, and based on the financial statements
referred to in Sections 3.01 and 5.04 and such other documents and information
as it has deemed appropriate, made its own credit analysis and decision to enter
into this Agreement and the other Financing Documents to which it is a party.
Each Lender Party also acknowledges that it will, independently and without
reliance upon any Agent, any Arranger Party or any other Lender Party and based
on such documents and information as it shall deem appropriate at the time,
continue to make its own credit decisions in taking or not taking action under
this Agreement and the other Financing Documents to which it is a party.
SECTION 7.05. Indemnification. (a) Each Lender severally agrees to
indemnify the Administrative Agent and the Arranger Parties (in each case to the
extent not promptly reimbursed by the Borrower) from and against such Lender
ratable share (determined as provided below) of any and all liabilities,
obligations, losses, damages, penalties, actions, judgments, suits, costs,
expenses or disbursements of any kind or nature whatsoever that may be imposed
on, incurred by, or asserted against the Administrative Agent or any Arranger
Party, as the case may be, in any way relating to or arising out of the
Financing Documents or any action taken or omitted by the Administrative Agent
or any Arranger Party under the Financing Documents (collectively, the
"Indemnified Costs"); provided that no Lender shall be liable for any portion of
such liabilities, obligations, losses, damages, penalties, actions, judgments,
suits, costs, expenses or disbursements resulting directly and primarily from
the Administrative Agent's or such Arranger Party's gross negligence or willful
misconduct as found in a final, non-appealable judgment by a court of competent
jurisdiction. Without limitation of the foregoing, each Lender agrees to
reimburse the Administrative Agent and each Arranger Party promptly upon demand
for its ratable share of any costs and expenses (including fees and expenses of
counsel) payable by the Borrower under Section 8.04, to the extent that the
Administrative Agent or such Arranger Party is not promptly reimbursed for such
costs and expenses by the Borrower. In the case of any investigation, litigation
or proceeding giving rise to any Indemnified Costs, this Section 7.05 applies
whether any such investigation, litigation or proceeding is brought by any
Lender or any other Person.
(b) Each Revolving Lender severally agrees to indemnify each Issuing
Bank (to the extent not promptly reimbursed by the Borrower) from and against
such Revolving Lender's ratable share (determined as provided below) of any and
all liabilities, obligations, losses, damages, penalties, actions, judgments,
suits, costs, expenses or disbursements of any kind or nature whatsoever that
may be imposed on, incurred by, or asserted against such Issuing Bank in any way
relating to or arising out of the Financing Documents or any action taken or
omitted by such Issuing Bank under the Financing Documents (including the
issuance or transfer of, or payment or failure to pay under, any Letter of
Credit); provided that no Revolving Lender Party shall be liable for any portion
of such liabilities, obligations, losses, damages, penalties, actions,
judgments, suits, costs, expenses or disbursements resulting directly and
primarily from such Issuing Bank's gross negligence or willful misconduct as
found in a final, non-appealable judgment by a court of competent jurisdiction.
Without limitation of the foregoing, each Revolving Lender agrees to reimburse
such Issuing Bank promptly upon demand for its ratable share of any costs and
expenses (including, without limitation, fees and expenses of counsel) payable
by the Borrower under Section 8.04, to the extent that such Issuing Bank is not
promptly reimbursed for such costs and expenses by the Borrower.
(c) For purposes of this Section 7.05, the Lenders' respective ratable
shares of any amount shall be determined, at any time, according to the sum of
(i) the aggregate principal amount of the Advances outstanding at such time and
owing to the respective Lenders and (ii) their respective Pro Rata Shares of the
L/C Obligations outstanding at such time; provided that the aggregate principal
amount of L/C Credit Extensions owing to any Issuing Bank and the aggregate
principal amount of Swing Line Advances owing to the Swing Line Bank shall each
be considered to be owed to the Revolving Lenders ratably in accordance with
their respective Revolving Commitments. The failure of any Lender to reimburse
the Administrative Agent, any Arranger Party or any Issuing Bank, as the case
may be, promptly upon demand for its ratable share of any amount required to be
paid by the Lender Parties to the Administrative Agent, any Arranger Party or
any Issuing Bank, as the case may be, as provided herein shall not relieve any
other Lender Party of its obligation hereunder to reimburse the Administrative
Agent, any Arranger Party or any Issuing Bank, as the case may be, for its
ratable share of such amount, but no Lender Party shall be responsible for the
failure of any other Lender Party to reimburse the Administrative Agent, any
Arranger Party or any Issuing Bank, as the case may be, for such other Lender
Party's ratable share of such amount. Without prejudice to the survival of any
other agreement of any Lender Party hereunder, the agreement and obligations of
each Lender Party contained in this Section 7.05 shall survive the payment in
full of principal, interest and all other amounts payable hereunder and under
the other Financing Documents.
SECTION 7.06. Successor Administrative Agent. The Administrative Agent
may resign at any time by giving written notice thereof to the Lender Parties
and the Borrower and may be removed at any time with or without cause by the
Required Lenders. Upon any such resignation or removal, the Required Lenders
shall have the right to appoint a successor Administrative Agent. If no
successor Administrative Agent shall have been so appointed by the Required
Lenders, and shall have accepted such appointment, within 30 days after the
retiring Administrative Agent's giving of notice of resignation or the Required
Lenders' removal of the retiring Administrative Agent, then the retiring
Administrative Agent may, on behalf of the Lender Parties, appoint a successor
Administrative Agent, which shall be a commercial bank organized under the laws
of the United States or of any State thereof and having a combined capital and
surplus of at least $500,000,000. Upon the acceptance of any appointment as
Administrative Agent hereunder by a successor Administrative Agent, such
successor Administrative Agent shall succeed to and become vested with all the
rights, powers, discretion, privileges and duties of the retiring Administrative
Agent, and the retiring Administrative Agent shall be discharged from its duties
and obligations under the Financing Documents. After any retiring Administrative
Agent's resignation or removal hereunder as Administrative Agent shall have
become effective, the provisions of this Article VII shall inure to its benefit
as to any actions taken or omitted to be taken by it while it was Administrative
Agent under the Financing Documents.
SECTION 7.07. Liability. Neither any Agent nor any Arranger Party shall
be liable for any error of judgment or for any act done or omitted to be done by
it in good faith or for any mistake of fact or law, or for anything it may do or
refrain from doing, except to the extent that any such liability is found in a
final, non-appealable judgment by a court of competent jurisdiction to have
resulted directly and primarily from its gross negligence or willful misconduct.
SECTION 7.08. Compensation of Agents. The Administrative Agent shall be
entitled to reasonable compensation as may be agreed from time to time between
the Borrower and the Administrative Agent, for all services rendered under this
Agreement and the other Financing Documents to which it is a party and such
compensation, together with reimbursement of the Administrative Agent in its
individual capacity (and its agency capacity) for its advances, disbursements
and reasonable expenses in connection with the performance of the trust and
activities provided for herein (including the reasonable fees and expenses of
its agents and of counsel, accountants and other experts), shall be paid in full
by the Borrower promptly following demand from the Administrative Agent from
time to time as services are rendered and expenses are incurred. All such
payments made by the Borrower to the Administrative Agent shall be made free and
clear of all present and future income, stamp or other taxes, levies and
withholdings imposed, assessed, levied or collected by the government of the
United States of America or any political subdivision or taxing authority
thereof. Except as otherwise expressly provided herein, no Lender Party shall
have any liability for any fees, expenses or disbursements of the Administrative
Agent. Upon its resignation or removal, the Administrative Agent shall be
entitled to the prompt payment by the Borrower of its compensation and
indemnification for the services rendered under this Agreement and the other
Financing Documents to which it is a party and to reimbursement of all
reasonable out-of-pocket expenses up to the date of resignation or removal
(including the reasonable fees and expenses of counsel, if any) incurred in
connection with the performance of such services. The agreements in this Section
7.08 shall survive any resignation or removal of the Administrative Agent and
the termination of the other provisions of this Agreement.
SECTION 7.09. Exculpatory Provisions. No Agent makes any representation
as to the value or condition of the security interests created under the
Collateral Documents or any part thereof, or as to the title of the Borrower or
as to the rights and interests granted or the security afforded by this
Agreement or any other Financing Document, or as to the validity, execution
(except by itself), enforceability, legality or sufficiency of this Agreement,
any other Financing Document or the Obligations secured under the Collateral
Documents, and no Agent (in its individual and agency capacities) shall incur
any liability or responsibility in respect of any such matters.
SECTION 7.10. Treatment of Lenders. Each of the Agents may treat the
Lender Parties as the holders of Commitments or L/C Credit Extensions and as the
absolute owners thereof for all purposes under this Agreement and the other
Financing Documents unless such Agent shall receive notice to the contrary from
such Lender Party.
SECTION 7.11. Miscellaneous. (a) Instructions. Each Agent shall have
the right at any time to seek instructions concerning the administration of its
duties and obligations hereunder or under any other Financing Documents from the
Lenders or any court of competent jurisdiction. In the event there is any
disagreement between the parties to this Agreement and the terms of this
Agreement or any other applicable Financing Document do not unambiguously
mandate the action any Agent is to take or not to take in connection therewith
under the circumstances then existing, or any Agent is in doubt as to what
action it is required to take or not to take, such Agent (other than with
respect to the Administrative Agent's actions required under the final sentence
of Section 7.01(a)) shall be entitled to refrain from taking any action until
directed otherwise in writing by a request signed jointly by the Required
Lenders or by order of a court of competent jurisdiction.
(b) No Obligation. None of the provisions of this Agreement or the
other Financing Documents shall be construed to require any Agent to expend or
risk its own funds or otherwise to incur any personal financial liability in the
performance of any of its duties hereunder or thereunder. No Agent shall be
under any obligation to exercise any of the rights or powers vested in it by
this Agreement or the other Financing Documents, at the request or direction of
the Borrower, or any Lender Party, (i) if any action it has been requested or
directed to take would be contrary to Applicable Law, or (ii) unless such Agent
shall have been offered security or indemnity reasonably satisfactory to it
against the costs, expenses and liabilities that might be incurred by it in
compliance with such request or direction (including interest thereon from the
time incurred until reimbursed).
SECTION 7.12. Arranger Parties. Except as set forth in Sections 7.03
and 8.12, none of the Lenders or other Persons identified on the cover page or
signature pages of this Agreement as a "joint lead arranger", "joint book
runner" or "co-syndication agent" shall have any right, power, obligation,
liability, responsibility or duty under this Agreement or any other Financing
Document other than, in the case of such Lenders, those applicable to all
Lenders as such. Without limiting the foregoing, none of the Lenders or other
Persons so identified shall have or be deemed to have any fiduciary relationship
with any Lender. Each Lender acknowledges that it has not relied, and will not
rely, on any of the Lenders or other Persons so identified in deciding to enter
into this Agreement or in taking or not taking action hereunder.
ARTICLE VIII
MISCELLANEOUS
SECTION 8.01. Amendments, Etc. (a) Amendments. No amendment or waiver
of any provision of this Agreement and the Notes, nor consent to any departure
by the Borrower therefrom, shall in any event be effective unless the same shall
be in writing and signed by the Required Lenders and, in the case of an
amendment only, the Borrower, and then such amendment, waiver or consent shall
be effective only in the specific instance and for the specific purpose for
which given; provided that no amendment waiver or consent shall, unless in
writing and signed by: (i) all of the Lenders at any time (A) amend (1) this
Section 8.01, (2) the term "Required Lenders" or (3) any other provision or
definition of this Agreement relating to the percentage of consent required for
any amendment, waiver or consent under this Agreement (other than pursuant to
clause (b)), (B) waive any condition set forth in Section 3.01 or 3.02, or (C)
prior to the Collateral Release Date release all or a substantial portion of, or
impair the priority of or the perfection of the security interest on, the
Collateral; (ii) all of the Revolving Lenders amend the term "Required Revolving
Lenders"; and (iii) all of the Lenders affected thereby, at any time (A) reduce
the principal of, or rate of interest on, the Advances or Notes or any fees or
other amounts payable hereunder or extend or postpone any date scheduled for any
payment required to be made hereunder (including pursuant to Section 2.05, 2.06
or 2.07), (B) extend the Final Maturity Date, (C) increase any Commitment or
subject any Lender Party to any additional obligation, (D) increase the amount
of any Letter of Credit Commitment that, in each case, shall be required for the
Required Lenders or any of them to take any action hereunder, (E) alter any
provision of this Agreement requiring the pro rata sharing of payments among the
Lender Parties, (F) change the order of application of any payments or
prepayments of Advances from the application thereof contemplated by Section
2.05 or 2.06 of this Agreement, (G) amend the definition of "Interest Period" so
as to allow the durations of Interest Periods to be in excess of six months
without regard to the availability to all Lenders of such duration, and (H)
limit the liability of the Borrower hereunder or under any of the Notes;
provided further that (x) no amendment, waiver or consent shall, unless in
writing and signed by the relevant Agent, the Swing Line Bank or the Issuing
Banks, as the case may be, in addition to the Lenders required above to take
such action, affect the rights or duties of such Agent, the Swing Line Bank or
any Issuing Bank under this Agreement, and (y) Section 8.07(h) may not be
amended, waived or otherwise modified without the consent of each Granting
Lender all or any part of whose Advances are being funded by any SPV at the time
of such amendment, waiver or other modification.
(b) Clarifications. No consent of any Lender shall be required in
connection with any amendment, modification or waiver of any provision of any
Collateral Document entered into by the Administrative Agent or the Collateral
Agent solely to (i) cure any ambiguity in any of the Collateral Documents or to
correct or supplement any provision of any of the Collateral Documents which is
manifestly inconsistent with any other provision of the Financing Documents;
provided that such action shall not adversely affect the interest of any Secured
Party in any respect or (ii) make any change that would provide any additional
benefits or rights to (but not impose any further obligations on) the Secured
Parties, so long as, prior to the execution of any such amendment, modification
or waiver referred to in this clause (b), the Borrower shall have delivered to
the Administrative Agent and the Collateral Agent an Officer's Certificate to
the effect that such amendment, modification or waiver complies with the
requirements of this clause (b). Neither the Administrative Agent nor the
Collateral Agent shall incur any liability by relying upon such Officer's
Certificate, except to the extent that such reliance shall constitute gross
negligence or willful misconduct.
(c) Other Financing Documents. Except as otherwise specifically
provided in this Agreement or any other Financing Document, the Lenders may
amend, modify, terminate, change or waive, or consent or agree to any amendment,
modification, termination, change or waiver of, any provision of any other
Financing Document to which they are a party in accordance with the terms
thereof.
SECTION 8.02. Notices, Etc. (a) Notices and other communications
provided for hereunder shall be either (i) in writing (including telecopier,
telegraphic or telex communication) and mailed, telecopied or otherwise
delivered or (ii) as and to the extent set forth in Section 8.02(b) and in the
proviso to this Section 8.02(a), if to the Borrower, at its address at Allegheny
Energy Supply Company, LLC, ▇▇▇ ▇▇▇▇▇ ▇▇▇▇ ▇▇▇▇▇, ▇▇▇▇▇▇▇▇▇▇, ▇▇ ▇▇▇▇▇, Fax:
(▇▇▇) ▇▇▇-▇▇▇▇, Attention: General Counsel and Chief Financial Officer; if to
any Initial Lender, the Initial Issuing Bank, any Lender or any Issuing Bank, at
its Domestic Lending Office; and if to the Administrative Agent, at its address
at ▇▇▇ ▇▇▇▇▇ ▇▇▇, ▇▇▇ ▇▇▇▇▇▇, ▇▇ ▇▇▇▇▇, Attention: Bank Loan Syndications
Department; or, as to the Borrower or the Administrative Agent, at such other
address as shall be designated by the Borrower or the Administrative Agent, as
the case may be, in a written notice to the other parties and, as to each other
party, at such other address as shall be designated by such party in a written
notice to the Borrower and the Administrative Agent, provided that materials
required to be delivered pursuant to Section 5.04 shall be delivered to the
Administrative Agent as specified in Section 8.02(b) or as otherwise specified
to the Borrower by the Administrative Agent. All such notices and communications
shall, when mailed, telecopied, telegraphed or e-mailed, be effective when
deposited in the mails, telecopied, delivered to the telegraph company or
confirmed by e-mail, respectively, except that notices and communications to the
Administrative Agent pursuant to Article II, Article III or Article VII shall
not be effective until received by the Administrative Agent. Delivery by
telecopier of an executed counterpart of any amendment or waiver of any
provision of this Agreement or the Notes or of any Exhibit hereto to be executed
and delivered hereunder shall be effective as delivery of a manually executed
counterpart thereof.
(b) So long as CUSA is the Administrative Agent, the Borrower hereby
agrees that it will provide to the Administrative Agent all information,
documents and other materials that it is obligated to furnish to the
Administrative Agent pursuant to the Financing Documents, including all notices,
requests, financial statements, financial and other reports, certificates and
other information materials, but excluding any such communication that (i)
relates to a request for a new, or a conversion of an existing, borrowing or
other extension of credit (including any election of an interest rate or
interest period relating thereto), (ii) relates to the payment of any principal
or other amount due under this Agreement prior to the scheduled date therefor,
(iii) provides notice of any Default or (iv) is required to be delivered to
satisfy any condition precedent to the effectiveness of this Agreement and/or
any borrowing or other extension of credit hereunder (all such non-excluded
communications being referred to herein collectively as "Communications"), by
transmitting the Communications in an electronic/soft medium in a format
acceptable to the Administrative Agent to ▇▇▇▇▇▇▇▇▇▇▇▇▇▇▇@▇▇▇▇▇▇▇▇▇.▇▇▇. In
addition, the Borrower agrees to continue to provide the Communications to the
Administrative Agent in the manner specified in the Financing Documents but only
to the extent requested by the Administrative Agent.
(c) The Borrower further agrees that the Administrative Agent may make
the Communications available to the Lender Parties by posting the Communications
on Intralinks or a substantially similar electronic transmission system (the
"Platform").
(d) THE PLATFORM IS PROVIDED "AS IS" AND "AS AVAILABLE". THE AGENT
PARTIES (AS DEFINED BELOW) DO NOT WARRANT THE ACCURACY OR COMPLETENESS OF THE
COMMUNICATIONS OR THE ADEQUACY OF THE PLATFORM AND EXPRESSLY DISCLAIM LIABILITY
FOR ERRORS OR OMISSIONS IN THE COMMUNICATIONS. NO WARRANTY OF ANY KIND, EXPRESS,
IMPLIED OR STATUTORY, INCLUDING ANY WARRANTY OF MERCHANTABILITY, FITNESS FOR A
PARTICULAR PURPOSE, NON-INFRINGEMENT OF THIRD PARTY RIGHTS OR FREEDOM FROM
VIRUSES OR OTHER CODE DEFECTS, IS MADE BY THE AGENT PARTIES IN CONNECTION WITH
THE COMMUNICATIONS OR THE PLATFORM. IN NO EVENT SHALL THE ADMINISTRATIVE AGENT
OR ANY OF ITS AFFILIATES OR ANY OF THEIR RESPECTIVE OFFICERS, DIRECTORS,
EMPLOYEES, AGENTS, ADVISORS OR REPRESENTATIVES (COLLECTIVELY, "AGENT PARTIES")
HAVE ANY LIABILITY TO THE BORROWER, ANY LENDER OR ANY OTHER PERSON OR ENTITY FOR
DAMAGES OF ANY KIND, INCLUDING DIRECT OR INDIRECT, SPECIAL, INCIDENTAL OR
CONSEQUENTIAL DAMAGES, LOSSES OR EXPENSES (WHETHER IN TORT, CONTRACT OR
OTHERWISE) ARISING OUT OF THE BORROWER'S OR THE ADMINISTRATIVE AGENT'S
TRANSMISSION OF COMMUNICATIONS THROUGH THE INTERNET, EXCEPT TO THE EXTENT THE
LIABILITY OF ANY AGENT PARTY IS FOUND IN A FINAL, NON-APPEALABLE JUDGMENT BY A
COURT OF COMPETENT JURISDICTION TO HAVE RESULTED PRIMARILY FROM SUCH AGENT
PARTY'S GROSS NEGLIGENCE OR WILLFUL MISCONDUCT.
(e) The Administrative Agent agrees that the receipt of the
Communications by the Administrative Agent at its e-mail address set forth above
shall constitute effective delivery of the Communications to the Administrative
Agent for purposes of the Financing Documents. Each Lender Party agrees that
receipt of notice to it (as provided in the next sentence) specifying that the
Communications have been posted to the Platform shall constitute effective
delivery of the Communications to such Lender Party for purposes of the
Financing Documents. Each Lender Party agrees to notify the Administrative Agent
in writing (including by electronic communication) from time to time of such
Lender Party's e-mail address to which the foregoing notice may be sent by
electronic transmission and (ii) that the foregoing notice may be sent to such
e-mail address.
(f) Nothing herein shall prejudice the right of the Administrative
Agent or any Lender Party to give any notice or other communication pursuant to
any Financing Document in any other manner specified in such Financing Document.
SECTION 8.03. No Waiver, Remedies. No failure by any Lender Party or
the Administrative Agent to exercise, and no delay by any such Person in
exercising, any right, remedy, power or privilege hereunder or under any other
Financing Document shall operate as a waiver thereof; nor shall any single or
partial exercise of any such right, remedy, power or privilege preclude any
other or further exercise thereof or the exercise of any other right, remedy,
power or privilege. The rights, remedies, powers and privileges provided herein
and in the other Financing Documents are cumulative and not exclusive of any
rights, remedies, powers and privileges provided by law.
SECTION 8.04. Indemnity and Expenses. (a) The Borrower agrees to pay
within 30 days (or earlier if, and to the extent, required under Article III)
after the presentation of an invoice all reasonable third-party costs and
expenses of (i) the Administrative Agent in connection with the administration
of this Agreement and the other Financing Documents and the transactions
contemplated hereby and thereby (but without duplication of such obligation
under any other Financing Document) and (ii) the Administrative Agent and the
Arranger Parties in connection with the preparation, negotiation, execution and
delivery of this Agreement, the Notes, the other Financing Documents and the
other documents to be delivered hereunder or thereunder, including (A) all due
diligence, syndication (including printing, distribution and bank meetings),
transportation, computer, duplication, appraisal, consultant, audit expenses
and, where appropriate, registration of all Financing Documents and (B) the
reasonable fees and expenses of counsel for the Administrative Agent. The
Borrower further agrees to pay on demand all costs and expenses of the
Administrative Agent, each Arranger Party and each Lender Party, if any
(including reasonable counsel fees and expenses), in connection with (1) the
enforcement (whether through negotiations, legal proceedings or otherwise) of
this Agreement, the Notes, the other Financing Documents and the other documents
to be delivered hereunder or thereunder, including reasonable fees and expenses
of counsel for the Administrative Agent, each Arranger Party and each Lender
Party; (2) the custody, preservation, use or operation of, or the sale of,
collection from or other realization upon, any of the Collateral; (3) the
exercise or enforcement of any of the rights of any Agent, any Arranger Party or
any Lender Party under any Financing Document; (4) the failure by the Borrower
to perform or observe any of the provisions hereof; and (5) any amendments,
modifications, waivers or consents required or requested under the Financing
Documents.
(b) The Borrower agrees to indemnify and hold harmless the
Administrative Agent, each Arranger Party and each Lender Party and each of
their Affiliates and their respective officers, directors, employees, agents,
trustees, attorneys and advisors (each, an "Indemnified Party") from and against
any and all claims, damages, losses, liabilities and expenses (including
reasonable fees and expenses of counsel) that may be incurred by or asserted or
awarded against any Indemnified Party, in each case arising out of or in
connection with or by reason of (including in connection with any investigation,
litigation or proceeding or preparation of a defense in connection therewith) or
relating to (i) execution, amendment or administration of this Agreement, the
other Financing Documents, any Letter of Credit, any of the transactions
contemplated herein or therein or the actual or proposed use of the proceeds of
the Advances or any L/C Borrowings, (ii) the issuance or transfer of, or payment
or failure to pay under, any Letter of Credit or (iii) the actual or alleged
presence of Hazardous Materials requiring remediation or other response pursuant
to Environmental Law on any property of the Borrower or any of its Subsidiaries
or any Environmental Action relating in any way to the Borrower or any of its
Subsidiaries, except to the extent such claim, damage, loss, liability or
expense is found in a final, non-appealable judgment by a court of competent
jurisdiction to have resulted directly and primarily from such Indemnified
Party's gross negligence or willful misconduct. In the case of an investigation,
litigation or other proceeding to which the indemnity in this Section 8.04(b)
applies, such indemnity shall be effective whether or not such investigation,
litigation or proceeding is brought by the Borrower, its directors,
equityholders or creditors or an Indemnified Party or any other Person, whether
or not any Indemnified Party is otherwise a party thereto and whether or not the
transactions contemplated hereby are consummated. The Borrower also agrees not
to assert any claim against the Administrative Agent, any Lender Party or any of
their Affiliates, or any of their respective officers, directors, employees,
agents, attorneys and advisors, on any theory of liability, for special,
indirect, consequential or punitive damages arising out of or otherwise relating
to the Facilities, the actual or proposed use of the proceeds of the Advances or
any Letter of Credit, the Financing Documents or any of the transactions
contemplated by the Financing Documents.
(c) The indemnities provided by the Borrower pursuant to this Agreement
shall survive the expiration, cancellation, termination or modification of this
Agreement or the other Financing Documents, the resignation or removal of the
Administrative Agent, and the provision of any subsequent or additional
indemnity by any Person.
(d) If any payment of principal of, or Conversion of, any Eurodollar
Rate Advance is made by the Borrower to or for the account of a Lender Party
other than on the last day of the Interest Period for such Advance, as a result
of a payment or Conversion pursuant to Section 2.06, 2.11(b) or 2.12(c),
acceleration of the maturity of the Notes pursuant to Section 6.01 or for any
other reason, or if the Borrower fails to make any payment or prepayment of an
Advance for which a notice of prepayment has been given or that is otherwise
required to be made, whether pursuant to Section 2.04, 2.06 or 6.01 or
otherwise, the Borrower shall, upon demand by such Lender Party (with a copy of
such demand to the Administrative Agent), pay to the Administrative Agent for
the account of such Lender Party any amounts required to compensate such Lender
Party for any additional losses, costs or expenses that it may reasonably incur
as a result of such payment or Conversion or such failure to pay or prepay, as
the case may be, including any loss (excluding loss of anticipated profits),
cost or expense incurred by reason of the liquidation or reemployment of
deposits or other funds acquired by any Lender Party to fund or maintain such
Advances.
(e) If the Borrower fails to pay when due any costs, expenses or other
amounts payable by it under any Financing Document, including fees and expenses
of counsel and indemnities, such amount may be paid on behalf of the Borrower by
the Administrative Agent or any Lender Party, in its sole discretion.
SECTION 8.05. Right of Set-off. Upon (a) the occurrence and during the
continuance of any Event of Default and (b) the making of the request or the
granting of the consent specified by Section 6.02 to authorize the
Administrative Agent to declare the Notes due and payable pursuant to the
provisions of Section 6.02, the Administrative Agent and each Lender Party and
each of their respective Affiliates is hereby authorized at any time and from
time to time, to the fullest extent permitted by law, to set off and otherwise
apply any and all deposits (general or special, time or demand, provisional or
final), other than any Pledged Account or the Controlled Accounts, at any time
held and other indebtedness at any time owing by the Administrative Agent, such
Lender Party or such Affiliate to or for the credit or the account of the
Borrower against any and all of the Obligations of the Borrower now or hereafter
existing under the Financing Documents, irrespective of whether the
Administrative Agent or such Lender Party shall have made any demand under this
Agreement or such Note or Notes and although such Obligations may be unmatured.
The Administrative Agent and each Lender Party agrees promptly to notify the
Borrower after any such set-off and application; provided, however, that the
failure to give such notice shall not affect the validity of such set-off and
application. The rights of the Administrative Agent and each Lender Party and
their respective Affiliates under this Section 8.05 are in addition to other
rights and remedies (including other rights of set-off) that the Administrative
Agent, such Lender Party and their respective Affiliates may have.
SECTION 8.06. Binding Effect. This Agreement shall become effective at
such time as it shall have been executed by the Borrower and the Administrative
Agent and the Administrative Agent shall have been notified by each Initial
Lender Party that such Initial Lender Party has executed it and thereafter shall
be binding upon and inure to the benefit of the Borrower, the Administrative
Agent and each Lender Party and their respective successors and assigns, except
that the Borrower shall not have the right to assign its rights hereunder or any
interest herein without the prior written consent of the Lender Parties.
SECTION 8.07. Assignments and Participations. (a) Each Lender Party may
and, if requested by the Borrower (following (i) a demand by such Lender Party
for the payment of additional compensation pursuant to Section 2.12 or 2.13,
(ii) an assertion by such Lender Party pursuant to Section 2.10 that it is
unlawful for such Lender Party to make Eurodollar Rate Advances or (iii) a
failure by such Lender Party to approve any amendment or waiver pursuant to
Section 8.01, provided that such amendment or waiver would otherwise have been
effective but for such Lender Party's failure, together with the failure of any
other Lender Party to which the Borrower has made a similar request under this
clause (a), to approve such amendment or waiver, provided further that, with
respect to clause (iii), such failure to approve shall have continued for a
period of not less than five Business Days following written notice by the
Borrower to such Lender Party of such request by the Borrower), shall assign to
one or more Eligible Assignees all or a portion of its rights and obligations
under this Agreement (including (y) all or a portion of its Revolving
Commitment, the Revolving Advances owing to it, L/C Credit Extensions and the
Revolving Note or Revolving Notes held by it, and/or (z) all or a portion of its
Term Commitment, the Term Advances owing to it, and the Term Note or Term Notes
held by it), including any pledge or assignment to secure obligations to a
Federal Reserve Bank; provided, however, that (i) each such assignment shall be
of a uniform, and not a varying, percentage of all rights and obligations of
such Lender under and in respect of and shall be made on a pro rata basis with
respect to each of the Term Advances or the Revolving Advances, as applicable,
held by such Lender, (ii) except in the case of an assignment to a Person that,
immediately prior to such assignment, was a Lender Party, an Affiliate of any
Lender Party or an Approved Fund or an assignment of all of a Lender Party's
rights and obligations under this Agreement, the aggregate amount of (A) any
Term Commitment or Term Advance being assigned to such Person pursuant to such
assignment (determined as of the date of the Assignment and Acceptance with
respect to such assignment) shall in no event be less than $5,000,000 (or such
lesser amount as shall be approved by the Administrative Agent) and shall be in
increments of $1,000,000 in excess thereof; provided that Related Funds shall be
combined for purposes of determining compliance with such minimum assignment
amounts, or (B) any Revolving Commitment or Revolving Advance being assigned to
such Eligible Assignee pursuant to such assignment (determined as of the date of
the Assignment and Acceptance with respect to such assignment) shall in no event
be less than $5,000,000 (or such lesser amount as shall be approved by the
Administrative Agent) and shall be in increments of $1,000,000 in excess
thereof, (iii) (A) with respect to any Term Commitment or any Term Advance, no
such assignments shall be permitted without the consent of the Administrative
Agent (such consent not to be unreasonably withheld) and, so long as no
Specified Default has occurred and is continuing, the consent of the Borrower
(such consent not to be unreasonably withheld), except assignments to any other
Lender Party, an Affiliate of any Lender, an Approved Fund or to any Federal
Reserve Bank, and (B) with respect to any Revolving Commitment, Revolving
Advance, L/C Credit Extension or L/C Borrowing, no such assignments shall be
permitted without the consent of the Swing Line Bank and each Issuing Bank (in
each case, acting in its sole discretion), the Administrative Agent (such
consent not to be unreasonably withheld or delayed) and, so long as no Specified
Default has occurred and is continuing, the consent of the Borrower (such
consent not to be unreasonably withheld), except, with respect to the Borrower's
consent only, assignments to any other Lender Party, an Affiliate of any Lender,
any Approved Fund or to any Federal Reserve Bank, and (iv) the parties to each
such assignment shall execute and deliver to the Administrative Agent, for its
acceptance and recording in the Register, an Assignment and Acceptance, together
with any Note or Notes subject to such assignment and a processing and
recordation fee of $3,500 (such fee to be paid by the Borrower if such
assignment is being made pursuant to a request of the Borrower therefor under
this Section 8.07(a)); provided that only one such fee shall be payable in the
case of contemporaneous assignments to or by two or more Approved Funds and (v)
with respect to Revolving Commitment or Revolving Advance, each such assignment
thereof shall be made on a pro rata basis with respect to each of (A) such
Revolving Lender's Revolving Advances and L/C Credit Extensions and (B) such
Revolving Lender's Revolving Commitment; provided further that (I) each such
assignment made as a result of a request by the Borrower pursuant to this
Section 8.07(a) shall be arranged by the Borrower with the approval of the
Administrative Agent, which approval shall not be unreasonably withheld or
delayed, and shall be either an assignment of all of the rights and obligations
of the assigning Lender under this Agreement or an assignment of a portion of
such rights and obligations made concurrently with another such assignment or
other such assignments that, in the aggregate, cover all of the rights and
obligations of the assigning Lender under this Agreement and (II) no Lender
shall be obligated to make any such assignment as a result of a demand by the
Borrower pursuant to this Section 8.07(a) unless and until such Lender shall
have received one or more payments from one or more Eligible Assignees in an
aggregate amount at least equal to the aggregate outstanding principal amount of
the Advances owing to such Lender, together with accrued interest thereon to the
date of payment of such principal amount, and from the Borrower and/or one or
more Eligible Assignees in an aggregate amount equal to all other amounts
payable to such Lender under this Agreement and the other Financing Documents
(including, without limitation, any amounts owing under Section 2.12, 2.13 or
8.04).
(b) Any Issuing Bank may assign to an Eligible Assignee all of its
rights and obligations under the undrawn portion of its commitment hereunder to
issue Letters of Credit at any time; provided, however, that (i) each such
assignment shall be to an Eligible Assignee, (ii) the parties to each such
assignment shall execute and deliver to the Administrative Agent, for its
acceptance and recording in the Register, an Assignment and Acceptance, together
with a processing and recordation fee of $3,500 and (iii) so long as no
Specified Default has occurred and is continuing, the Borrower has consented to
the assignment (such consent not to be unreasonably withheld).
(c) Upon such execution, delivery, acceptance and recording, from and
after the effective date specified in such Assignment and Acceptance, (i) the
assignee thereunder shall be a party hereto and, to the extent that rights and
obligations hereunder have been assigned to it pursuant to such Assignment and
Acceptance, have the rights and obligations of a Lender or Issuing Bank, as the
case may be, hereunder and (ii) the Lender or Issuing Bank assignor thereunder
shall, to the extent that rights and obligations hereunder have been assigned by
it pursuant to such Assignment and Acceptance, relinquish its rights (other than
its rights under Sections 2.12, 2.13 and 8.04 to the extent any claim thereunder
relates to an event arising prior to such assignment) and be released from its
obligations under this Agreement (and, in the case of an Assignment and
Acceptance covering all of the remaining portion of an assigning Lender's or
Issuing Bank's rights and obligations under this Agreement, such Lender or
Issuing Bank shall cease to be a party hereto).
(d) By executing and delivering an Assignment and Acceptance, each
Lender Party assignor thereunder and each assignee thereunder confirm to and
agree with each other and the other parties thereto and hereto as follows: (i)
other than as provided in such Assignment and Acceptance, such assigning Lender
Party makes no representation or warranty and assumes no responsibility with
respect to any statements, warranties or representations made in or in
connection with any Financing Document or the execution, legality, validity,
enforceability, genuineness, sufficiency or value of, or the perfection or
priority of any lien or security interest created or purported to be created
under or in connection with any Financing Document or any other instrument or
document furnished pursuant thereto; (ii) such assigning Lender Party makes no
representation or warranty and assumes no responsibility with respect to the
financial condition of the Borrower or the performance or observance by the
Borrower of any of its obligations under any Financing Document or any other
instrument or document furnished pursuant thereto; (iii) such assignee confirms
that it has received a copy of this Agreement and each other Financing Document,
together with copies of the financial statements referred to in Sections
4.01(f), 5.04(b) and 5.04(c) and such other documents and information as it has
deemed appropriate to make its own credit analysis and decision to enter into
such Assignment and Acceptance; (iv) such assignee will, independently and
without reliance upon the Administrative Agent, such assigning Lender Party or
any other Lender Party and based on such documents and information as it shall
deem appropriate at the time, continue to make its own credit decisions in
taking or not taking action under this Agreement or any other Financing
Document; (v) such assignee confirms that it is an Eligible Assignee; (vi) such
assignee appoints and authorizes each Agent to take such action as agent on its
behalf and to exercise such powers and discretion under the Financing Documents
as are delegated to such Agent by the terms hereof and thereof, together with
such powers and discretion as are reasonably incidental thereto; and (vii) such
assignee agrees that it will perform in accordance with their terms all of the
obligations that by the terms of this Agreement and the other Financing
Documents are required to be performed by it as a Lender or Issuing Bank, as the
case may be.
(e) The Administrative Agent shall maintain at its address referred to
in Section 8.02 a copy of each Assignment and Acceptance delivered to and
accepted by it and a register for the recordation of the names and addresses of
the Lender Parties and the Commitments of, and principal amount of the Advances
and L/C Borrowings owing to, each Lender Party from time to time (the
"Register"). The entries in the Register shall be conclusive and binding for all
purposes, absent manifest error, and the Borrower, the Administrative Agent and
the Lender Parties shall treat each Person whose name is recorded in the
Register as a Lender Party hereunder for all purposes of this Agreement. The
Register shall be available for inspection by the Borrower or the Administrative
Agent or any Lender Party at any reasonable time and from time to time upon
reasonable prior notice.
(f) Upon its receipt of an Assignment and Acceptance executed by an
assigning Lender Party and an assignee, together with any Note or Notes subject
to such assignment, the Administrative Agent shall, if such Assignment and
Acceptance has been completed and is in substantially the form of Exhibit C, (i)
accept such Assignment and Acceptance, (ii) record the information contained
therein in the Register and (iii) give prompt notice thereof to the Borrower. In
the case of any assignment by a Lender, within five Business Days after its
receipt of such notice, the Borrower, at its own expense, shall execute and
deliver to the Administrative Agent in exchange for the surrendered Note or
Notes a new Note to the order of such Eligible Assignee in an amount equal to
the Revolving Commitment or Term Commitment, as the case may be, assumed by it
pursuant to such Assignment and Acceptance and, if any assigning Lender has
retained a Revolving Commitment or Term Commitment, as the case may be,
hereunder, a new Note to the order of such assigning Lender in an amount equal
to the Revolving Commitment or Term Commitment, as the case may be, retained by
it hereunder. Such new Note or Notes shall be in an aggregate principal amount
equal to the aggregate principal amount of such surrendered Note or Notes, shall
be dated the effective date of such Assignment and Acceptance and shall
otherwise be in substantially the form of Exhibit A-1 or Exhibit A-2, as
applicable.
(g) Each Lender Party may sell participations to one or more Persons
(other than the Borrower or any Affiliate of the Borrower) in or to all or a
portion of its rights and obligations under this Agreement (including (i) all or
a portion of its Revolving Commitment, the Revolving Advances owing to it, L/C
Credit Extensions and the Revolving Note or Revolving Notes (if any) held by it,
and/or (ii) all or a portion of its Term Commitment, the Term Advances owing to
it, and the Term Note or Term Notes (if any) held by it); provided, however,
that (i) any such sale shall be of a uniform and not varying percentage of all
of its rights and obligations in respect of such Advances and/or all or a
portion of its Term Commitment, the Term Advances owing to it, and the Term
Notes (if any) held by it, (ii) such Lender Party's obligations under this
Agreement (including its Revolving Commitment and L/C Credit Extensions or Term
Commitment, as the case may be) shall remain unchanged, (iii) such Lender Party
shall remain solely responsible to the other parties hereto for the performance
of such obligations, (iv) such Lender Party shall remain the holder of any such
Note for all purposes of this Agreement, (v) the Borrower, the Administrative
Agent and the other Lender Parties shall continue to deal solely and directly
with such Lender Party in connection with such Lender Party's rights and
obligations under this Agreement and (vi) no participant under any such
participation shall have any right to approve any amendment or waiver of any
provision of any Financing Document, or any consent to any departure by the
Borrower therefrom, except to the extent that such amendment, waiver or consent
would reduce the principal of, or interest on, the Notes or any fees or other
amounts payable hereunder, in each case to the extent subject to such
participation, postpone any date fixed for any payment of principal of, or
interest on, the Notes or any fees or other amounts payable hereunder, in each
case to the extent subject to such participation.
(h) Notwithstanding anything in this Agreement to the contrary
(including any other provision regarding assignments, participations, transfers
or novations), any Lender (a "Granting Lender") may, without the consent of any
other party hereto, grant to a special purpose vehicle (whether a corporation,
partnership, limited liability company, trust or otherwise, an "SPV") sponsored
or managed by the Granting Lender or any Affiliate thereof, a participation in
all or any part of any Advance (including the Commitment therefor) that such
Granting Lender has made or will make pursuant to this Agreement; provided that
(i) such Granting Lender's obligations under this Agreement (including its
Commitment) shall remain unchanged; (ii) such Granting Lender shall remain the
holder of its Note for all purposes under this Agreement; and (iii) the
Borrower, the Administrative Agent and the other Lenders shall continue to deal
solely and directly with such Granting Lender in connection with such Granting
Lender's rights and obligations under the Financing Documents. Each party hereto
hereby agrees that (A) no SPV will be entitled to any rights or benefits that a
Lender would not otherwise be entitled to under this Agreement or any other
Financing Document; and (B) an SPV may assign its interest in any Advance under
this Agreement to any Person that would constitute a Lender subject to the
satisfaction of all requirements for an assignment by any Lender set forth in
this Section 8.07. Notwithstanding anything in this Agreement to the contrary,
the Granting Lender and any SPV may, without the consent of any other party to
this Agreement, and without limiting any other rights of disclosure of the
Granting Lender under this Agreement, disclose on a confidential basis any
non-public information relating to its funding of its Advances to (1) (in the
case of the Granting Lender) any actual or prospective SPV, (2) (in the case of
an SPV) its lenders, sureties, reinsurers, guarantors or credit liquidity
enhancers, (3) their respective directors, officers, and advisors, and (4) any
rating agency.
(i) Any Lender Party may, in connection with any assignment or
participation or proposed assignment or participation pursuant to this Section
8.07, disclose to the assignee or participant or proposed assignee or
participant any information relating to the Borrower furnished to such Lender
Party by or on behalf of the Borrower, subject to the requirements set forth in
Section 8.12.
(j) Notwithstanding any other provision set forth in this Agreement,
any Lender Party may at any time pledge or assign a security interest in all or
any portion of its rights under this Agreement (including the Advances owing to
it and the Note or Notes held by it) to secure the obligations of such Lender
Party, including any pledge or assignment to secure obligations to a Federal
Reserve Bank; provided that no such pledge or assignment shall release such
Lender Party from any of its obligations hereunder or substitute any such
pledgee or assignee for such Lender Party as a party hereto.
SECTION 8.08. Execution in Counterparts. This Agreement may be executed
in any number of counterparts and by different parties hereto in separate
counterparts, each of which when so executed shall be deemed to be an original
and all of which taken together shall constitute one and the same agreement.
Delivery of an executed counterpart of a signature page to this Agreement by
telecopier shall be effective as delivery of an original executed counterpart of
this Agreement.
SECTION 8.09. Jurisdiction, Etc. (a) Each of the parties hereto hereby
irrevocably and unconditionally submits, for itself and its property, to the
non-exclusive jurisdiction of any New York State court or Federal court of the
United States of America sitting in New York City, and any appellate court from
any thereof, in any action or proceeding arising out of or relating to this
Agreement or any of the other Financing Documents to which it is a party, or for
recognition or enforcement of any judgment, and each of the parties hereto
hereby irrevocably and unconditionally agrees that all claims in respect of any
such action or proceeding may be heard and determined in any such New York State
court or, to the fullest extent permitted by law, in such Federal court. Each of
the parties hereto agrees that a final judgment in any such action or proceeding
shall be conclusive and may be enforced in other jurisdictions by suit on the
judgment or in any other manner provided by law. Nothing in this Agreement shall
affect any right that any party may otherwise have to bring any action or
proceeding relating to this Agreement or any of the other Financing Documents in
the courts of any jurisdiction.
(b) Each of the parties hereto irrevocably and unconditionally waives,
to the fullest extent it may legally and effectively do so, any objection that
it may now or hereafter have to the laying of venue of any suit, action or
proceeding arising out of or relating to this Agreement or any of the other
Financing Documents to which it is a party in any New York State or Federal
court. Each of the parties hereto hereby irrevocably waives, to the fullest
extent permitted by law, the defense of an inconvenient forum to the maintenance
of such action or proceeding in any such court.
SECTION 8.10. Governing Law. This Agreement and the Notes shall be
governed by, and construed in accordance with, the laws of the State of New
York.
SECTION 8.11. Waiver of Jury Trial. The Borrower, the Administrative
Agent and the Lender Parties irrevocably waives all right to trial by jury in
any action, proceeding or counterclaim (whether based on contract, tort or
otherwise) arising out of or relating to any of the Financing Documents, the
Advances, any Letter of Credit or the actions of the Administrative Agent or any
Lender Party in the negotiation, administration, performance or enforcement
thereof.
SECTION 8.12. Confidentiality. (a) Neither the Administrative Agent,
any Arranger Party nor any Lender Party may, without the prior written consent
of the Borrower, disclose to any Person (i) any confidential, proprietary or
non-public information of the Borrower furnished to the Administrative Agent,
the Arranger Parties or the Lender Parties by the Borrower (such information
being referred to collectively herein as the "Confidential Information") or (ii)
the fact that the Confidential Information has been made available or any of the
terms, conditions or other facts with respect to the Confidential Information,
in each case except as permitted by Section 8.07 or this Section 8.12 and except
that the Administrative Agent, each of the Arranger Parties and each of the
Lender Parties may disclose Confidential Information (i) to its and its
Affiliates' employees, officers, directors, agents and advisors (collectively,
"Representatives") who need to know the Confidential Information for the purpose
of administering or enforcing its rights under this Agreement and the other
Financing Documents and the transactions contemplated hereby and thereby or for
the discharge of their duties (it being understood that the Representatives to
whom such disclosure is made will be informed of the confidential nature of such
Confidential Information and instructed to keep such Confidential Information
confidential on substantially the same terms as provided herein), (ii) to the
extent requested by any regulatory authority having jurisdiction over it or to
the extent necessary for purposes of enforcing this Agreement or any other
Financing Document, (iii) to the extent required by applicable laws or
regulations or by any subpoena or similar legal process, (iv) to any other party
to this Agreement, (v) in connection with the exercise of any remedies hereunder
or under any other Financing Document or any suit, action or proceeding relating
to this Agreement or any other Financing Document or the enforcement of rights
hereunder or thereunder, (vi) subject to an agreement containing provisions
substantially the same as those of this Section 8.12, to any assignee or pledgee
of or participant in, or any prospective assignee or pledgee of or participant
in, any of its rights or obligations under this Agreement, including in the case
of any securitization or collateralization of, or other similar transaction
relating to the rights and obligations of any Lender or Lenders hereunder,
disclosure to any necessary Person in connection with such securitization,
collateralization or other transaction (including any funding vehicle organized
to undertake or effectuate such securitization, collateralization or other
transaction, its lenders, sureties, reinsurers, swap counterparties, guarantors
or credit liquidity enhancers, their respective directors, officers, and
advisors, and any rating agency), so long as the Persons to whom such disclosure
is made will be informed of the confidential nature of such Confidential
Information and such Persons have agreed in writing (or with respect to any
rating agency, in writing or otherwise) to keep such Confidential Information
confidential on substantially the same terms as provided herein, (vii) to the
extent such Confidential Information (A) is or becomes generally available to
the public on a non-confidential basis other than as a result of a breach of
this Section 8.12 by the Administrative Agent, such Arranger Party or such
Lender Party, or (B) is or becomes available to the Administrative Agent, such
Arranger Party or such Lender Party on a nonconfidential basis from a source
other than a Borrower and (viii) with the consent of the Borrower.
(b) Neither the Administrative Agent, any Arranger Party nor any Lender
Party shall, without the prior written consent of the Borrower, use, either
directly or indirectly, any of the Confidential Information except in connection
with this Agreement and the other Financing Documents and the transactions
contemplated hereby and thereby.
(c) Notwithstanding the foregoing, any of the parties hereto may
disclose to any and all Persons, without limitation of any kind, the U.S. tax
treatment and U.S. tax structure of the transactions contemplated by this
Agreement and the other Financing Documents and all materials of any kind
(including opinions or other tax analyses) that are provided to such parties
relating to such U.S. tax treatment and U.S. tax structure.
(d) In the event that the Administrative Agent, any Arranger Party or
any Lender Party becomes legally compelled to disclose any of the Confidential
Information otherwise than as contemplated by Section 8.12(a), the
Administrative Agent, such Arranger Party or such Lender Party shall provide the
Borrower with notice of such event promptly upon its obtaining knowledge thereof
(provided that it is not otherwise prohibited by Applicable Law from giving such
notice) so that the Borrower may seek a protective order or other appropriate
remedy. In the event that such protective order or other remedy is not obtained,
the Administrative Agent, such Arranger Party or such Lender Party shall furnish
only that portion of the Confidential Information that it is legally required to
furnish and shall cooperate with the Borrower's counsel to enable the Borrower
to obtain a protective order or other reliable assurance that confidential
treatment will be accorded the Confidential Information.
(e) In the event of any breach of this Section 8.12, the Borrower shall
be entitled to equitable relief (including injunction and specific performance)
in addition to all other remedies available to it at law or in equity.
(f) Neither the Administrative Agent, any Arranger Party nor any Lender
Party shall make any public announcement, advertisement, statement or
communication regarding the Borrower, its Affiliates (insofar as such
announcement, advertisement, statement or communication relates to the Borrower
or the transactions contemplated hereby) or this Agreement or the transactions
contemplated hereby without the prior consent of the Borrower (such consent not
to be unreasonably withheld or delayed).
(g) The obligations of the Administrative Agent, each Arranger Party
and each Lender under this Section 8.12 shall survive for a period of one year
following the termination or expiration of this Agreement.
SECTION 8.13. Benefits of Agreement. Nothing in this Agreement or any
other Financing Document, express or implied, shall give to any Person, other
than the parties hereto, each Indemnified Party and each of their successors and
permitted assigns under this Agreement or any other Financing Document, any
benefit or any legal or equitable right or remedy under this Agreement; provided
that each Indemnified Party and its successors and assigns shall not have any
benefit or any legal or equitable right or remedy under this Agreement other
than as provided by Section 8.04(b).
SECTION 8.14. Severability. If any provision of this Agreement shall be
invalid, illegal or unenforceable, then to the extent permitted by law, the
validity, legality and enforceability of the remaining provisions shall not in
any way be affected or impaired thereby.
SECTION 8.15. Limitations. (a) The obligations, liabilities or
responsibilities of any party hereunder shall be limited to those obligations,
liabilities or responsibilities expressly set forth and attributed to such party
pursuant to this Agreement or otherwise applicable under Applicable Law.
(b) In no event shall any Indemnified Party be liable for, and the
Borrower hereby agrees not to assert any claim against any Indemnified Party, on
any theory of liability, for, consequential, incidental, indirect, punitive or
special damages arising out of or otherwise relating to the Notes, this
Agreement, the other Financing Documents, any of the transactions contemplated
herein or therein or the actual or proposed use of the proceeds of the Advances
or L/C Credit Extensions.
SECTION 8.16. Survival. Notwithstanding anything in this Agreement to
the contrary, Sections 7.05, 7.08, 7.12, 8.04, 8.09, 8.10, 8.11, 8.12 8.15 and
8.16 shall survive any termination of this Agreement. In addition, each
representation and warranty made or deemed to be made hereunder shall survive
the making of such representation and warranty, and no Lender Party shall be
deemed to have waived, by reason of making any Advance or making any payment
pursuant thereto, any Default that may arise by reason of such representation or
warranty proving to have been false or misleading, notwithstanding that such
Lender Party may have had notice or knowledge or reason to believe that such
representation or warranty was false or misleading at the time such Advance or
L/C Credit Extension was made.
SECTION 8.17. USA Patriot Act Notice. Each of the Lender Parties and
the Administrative Agent (for itself and not on behalf of any Lender Party)
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"), it is required to obtain, verify and record information that
identifies the Borrower, which information includes the name and address of the
Borrower and other information that will allow such Lender Party or the
Administrative Agent, as applicable, 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.
ALLEGHENY ENERGY SUPPLY COMPANY, LLC,
as Borrower
By ______________________________
Name:
Title:
CITICORP USA, INC.,
as Administrative Agent
By ______________________________
Name:
Title:
[CITICORP NORTH AMERICA, INC.],
as Initial Lender
By ______________________________
Name:
Title:
THE BANK OF NOVA SCOTIA,
as Initial Lender
By ______________________________
Name:
Title:
BANK OF AMERICA, N.A.,
as Initial Lender
By ______________________________
Name:
Title:
[ ],
as Initial Lender
By ______________________________
Name:
Title: