Exhibit B-1(d)
==============================================================================
U.S. $313,700,000
AMENDED AND RESTATED
CREDIT AGREEMENT
Dated as of May 1, 2001
Among
GPU, INC.
JERSEY CENTRAL POWER & LIGHT COMPANY
METROPOLITAN EDISON COMPANY
PENNSYLVANIA ELECTRIC COMPANY,
as Borrowers
and
THE LENDERS NAMED HEREIN,
as Lenders
and
THE CHASE MANHATTAN BANK,
as Administrative Agent
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▇▇ ▇▇▇▇▇▇, a division of CHASE SECURITIES INC.,
and
▇▇▇▇▇▇▇ ▇▇▇▇▇ ▇▇▇▇▇▇ INC.
as Joint Lead Arrangers
TABLE OF CONTENTS
Page
Article I DEFINITIONS AND ACCOUNTING TERMS
Section 1.1. Certain Defined Terms. 1
Section 1.2. Computation of Time Periods. 15
Section 1.3. Accounting Terms. 15
Article II AMOUNTS AND TERMS OF THE ADVANCES
Section 2.1. The Advances. 16
Section 2.2. Conversion of Advances. 17
Section 2.3. Advances Generally. 17
Section 2.4. Fees. 18
Section 2.5. Reduction of the Commitments and Sublimits. 19
Section 2.6. Repayment of Advances. 19
Section 2.7. Interest on Advances. 19
Section 2.8. Prepayments. 20
Section 2.9. Yield Protection. 20
Section 2.10. Payments and Computations. 24
Section 2.11. Sharing of Payments, Etc. 25
Section 2.12. Noteless Agreement; Evidence of Indebtedness. 26
Article III CONDITIONS OF LENDING
Section 3.1. Conditions Precedent to Initial Borrowing. 27
Section 3.2. Conditions Precedent to Each Borrowing. 30
Section 3.3. Conditions Precedent to Certain Borrowings. 30
Section 3.4. Reliance on Certificates. 31
Article IV REPRESENTATIONS AND WARRANTIES
Section 4.1. Representations and Warranties of the Borrowers. 31
Article V COVENANTS OF THE BORROWERS
Section 5.1. Affirmative Covenants. 34
Section 5.2. Negative Covenants. 35
Section 5.3. Reporting Requirements. 40
Section 5.4. Delivery of Pro-Forma Statements, PLR Rate
Order, Collateral Notes and Collateral FMBs. 42
Article VI EVENTS OF DEFAULT
Section 6.1. Events of Default. 44
Section 6.2. Declaration by the Administrative Agent. 46
i
Article VII THE ADMINISTRATIVE AGENT
Section 7.1. Authorization and Action. 46
Section 7.2. Reliance on the Administrative Agent, Etc. 47
Section 7.3. Chase and its Affiliates. 47
Section 7.4. Indemnification. 48
Section 7.5. Successor Administrative Agent. 48
Section 7.6. Determinations by Lenders; No Transfer of
Collateral Notes; Surrender of Collateral Notes. 49
Article VIII MISCELLANEOUS
Section 8.1. Amendments, Etc. 50
Section 8.2. Notices, Etc. 50
Section 8.3. No Waiver; Remedies. 51
Section 8.4. Costs, Expenses and Taxes. 51
Section 8.5. Right of Set-off. 53
Section 8.6. Lender Credit Decisions. 53
Section 8.7. Binding Effect. 54
Section 8.8. Assignments and Participations. 54
Section 8.9. Waiver of Jury Trial. 58
Section 8.10. Governing Law. 58
Section 8.11. Consent to Jurisdiction; Waiver of Immunities. 58
Section 8.12. Execution in Counterparts. 59
Section 8.13. Integration. 59
Section 8.14. Severability. 59
Section 8.15. Headings. 59
ii
Schedules
Schedule I - List of Applicable Lending Offices
Schedule II - Commitments
Schedule III - Senior Debt Documents
Schedule IV - Bilateral Agreements
Exhibits
Exhibit A - Form of Notice of Conversion
Exhibit B - Form of Notice of Borrowing
Exhibit C - Form of Assignment and Acceptance
Exhibit D - Form of JC First Mortgage Bond
Exhibit E - Form of JC Senior Note
Exhibit F - Form of JC First Mortgage Bond Supplemental Indenture
Exhibit G - Form of JC Note Order
Exhibit H - Form of ME First Mortgage Bond
Exhibit I - Form of ME Senior Note
Exhibit J - Form of ME First Mortgage Bond Supplemental
Indenture
Exhibit K - Form of ME Note Order
Exhibit L - Form of PE First Mortgage Bond
Exhibit M - Form of PE Senior Note
Exhibit N - Form of PE First Mortgage Bond Supplemental
Indenture
Exhibit O - Form of PE Senior Note Supplemental Indenture
Exhibit P - Form of Escrow Agreement
Exhibit Q - Form of Opinion of ▇▇▇▇▇▇ ▇▇▇▇ & Priest LLP
Exhibit R - Form of Opinion of King & Spalding
iii
THIS AMENDED AND RESTATED CREDIT AGREEMENT (this "Agreement"), dated as of
May 1, 2001, among GPU, INC., a Pennsylvania corporation ("GPU"), JERSEY CENTRAL
POWER & LIGHT COMPANY, a New Jersey corporation ("JC"), METROPOLITAN EDISON
COMPANY, a Pennsylvania corporation ("ME"), and PENNSYLVANIA ELECTRIC COMPANY, a
Pennsylvania corporation ("PE" and together with GPU, JC and ME being,
collectively, the "Borrowers" and each individually a "Borrower"); each Lender
listed on the signature pages hereof (together with each Person that is an
assignee thereof in accordance with Section 8.8, collectively, the "Lenders");
and THE CHASE MANHATTAN BANK ("Chase"), as administrative agent (the
"Administrative Agent") for the Lenders.
PRELIMINARY STATEMENTS
(1) The Borrowers have entered into an Amended and Restated Credit
Agreement, dated as of July 3, 1996 (as amended as of the date hereof, the
"Existing Credit Agreement"), with certain banks named therein (the "Existing
Bank Group"), Chase, as "Administrative Agent" and Citibank, N.A., as
"Syndication Agent" thereunder.
(2) The Borrowers have requested that the Existing Credit Agreement be
extended and that the Commitments thereunder be increased.
(3) The Existing Bank Group and certain other lenders currently parties to
the Bilateral Agreements have agreed to the Borrowers' request on the terms and
conditions set forth herein, and the Administrative Agent has agreed to act as
agent in such capacity as provided herein.
Based upon the foregoing and subject to the terms and conditions set forth
in this Agreement, including, without limitation, the conditions to
effectiveness set forth in Section 8.7, the parties hereto hereby agree to amend
and restate the Existing Credit Agreement as set forth herein:
ARTICLE I
DEFINITIONS AND ACCOUNTING TERMS
SECTION 1.1. Certain Defined Terms
As used in this Agreement, the following terms shall have the following
meanings (such meanings to be equally applicable to both the singular and plural
forms of the terms defined):
"Adjusted Debt" means all consolidated Debt of GPU and its
Subsidiaries, less (i) Subordinated Debt not exceeding the aggregate
principal amount of $400,000,000 and (ii) Securitization Securities not
exceeding the aggregate principal amount of $900,000,000.
"Advance" means an advance by a Lender to a Borrower as part of a
Borrowing and refers to a Eurodollar Rate Advance or a Base Rate Advance,
each of which shall be a "Type" of Advance. The Type of Advance may change
from time to time as and when such Advance is Converted. For purposes of
this Agreement, all Advances of a Lender (or portions thereof) of the same
Type, having the same Interest Period and made or Converted on the same
day shall be deemed to be a single Advance by such Lender until repaid or
next Converted.
"Affiliate" means, with respect to any Person, any trade or business
(whether or not incorporated) which is a member of a group of which such
Person is a member and which is under common control within the meaning of
Section 414 of the Internal Revenue Code of 1986, as amended from time to
time, and the regulations promulgated and rulings issued thereunder.
"Applicable Lending Office" means, with respect to each Lender, such
Lender's Domestic Lending Office in the case of a Base Rate Advance and
such Lender's Eurodollar Lending Office in the case of a Eurodollar Rate
Advance.
"Applicable Margin" means for a Eurodollar Rate Advance or a Base
Rate Advance, on any date, the basis points per annum set forth, in the
columns identified as ▇▇▇▇▇ ▇, ▇▇▇▇▇ ▇, ▇▇▇▇▇ ▇, ▇▇▇▇▇ ▇, ▇▇▇▇▇ 5 or Level
6 below, opposite the Type of such Advance.
--------------------------------------------------------------------------------
▇▇▇▇▇ ▇ ▇▇▇▇▇ ▇ ▇▇▇▇▇ ▇
------- ------- -------
A or BBB- BB+ or
better ▇▇▇▇▇ ▇ ▇▇▇▇▇ ▇ ▇▇▇▇▇ ▇ ▇▇▇▇ below*
A2 or ------- ------- ------- Ba1 or
S&P better A- BBB+ BBB below*
▇▇▇▇▇'▇ A3 Baa1 Baa2
--------------------------------------------------------------------------------
Basis Points Per Annum
--------------------------------------------------------------------------------
Eurodollar Rate 36.50 52.50 62.50 72.50 105.00 185.00
--------------------------------------------------------------------------------
Base Rate 00.00 00.00 00.00 00.00 05.00 85.00
--------------------------------------------------------------------------------
* or unrated
The Applicable Margin for a Borrower will be based upon the Level
corresponding to such Borrower's Debt Rating at the time of determination.
Any change in the Applicable Margin shall be effective as of the Borrowing
date following the date on which the applicable rating agency announces
the applicable change in ratings.
"Assignment and Acceptance" means an assignment and acceptance
entered into by an assigning Lender and an Eligible Assignee, in
substantially the form of Exhibit C
2
hereto, which assignment and acceptance is accepted by the Administrative
Agent, in accordance with Section 8.8.
"Base Case Cash Flow Statement" has the meaning specified in Section
3.1(m).
"Base Rate" means, for any day, a rate per annum (rounded upwards,
if necessary, to the next 1/16 of 1%) equal to the greater of (i) the
Prime Rate and (ii) the Federal Funds Rate in effect on such day plus 1/2
of 1%.
"Base Rate Advance" means an Advance that bears interest as provided
in Section 2.7(b).
"Bilateral Agreements" means the agreements set forth on Schedule IV
hereto.
"Borrowing" means a borrowing consisting of simultaneous Advances of
the same Type made by each of the Lenders pursuant to Section 2.1. A
Borrowing may be referred to herein as being a "Type" of Borrowing,
corresponding to the Type of Advances comprising such Borrowing. For
purposes of this Agreement, all Advances of the same Type, having the same
Interest Period and made or Converted on the same day shall be deemed a
single Borrowing hereunder until repaid or next Converted.
"Business Day" means a day of the year on which banks are not
required or authorized to close in New York City and, if the applicable
Business Day relates to any Eurodollar Rate Advances, on which dealings in
U.S. dollar deposits are carried on in the London interbank market.
"Change in Control" means the occurrence of either of the following:
(i) any entity, person (within the meaning of Section 14(d) of the
Securities Exchange Act of 1934, as amended (the "Exchange Act")) or group
(within the meaning of Section 13(d)(3) or 14(d)(2) of the Exchange Act)
(other than any Borrower) which theretofore was beneficial owner (as
defined in Rule 13d-3 under the Exchange Act) of less than 20% of GPU's
then outstanding common stock either (x) acquires shares of common stock
of GPU in a transaction or series of transactions that results in such
entity, person or group directly or indirectly owning beneficially 20% or
more of the outstanding common stock of GPU, or (y) acquires, by proxy or
otherwise the right to vote for the election of directors, for any merger,
combination or consolidation of GPU or any of its direct or indirect
subsidiaries, or for any other matter or question, more than 20% of the
then outstanding voting securities of GPU (except where such acquisition
is made by a person or persons appointed by at least a majority of the
board of directors
3
of GPU to act as proxy for any purpose); or (ii) the election or
appointment, within a twelve-month period, of persons to GPU's board of
directors who were not directors of GPU at the beginning of such
twelve-month period, and whose election or appointment was not approved by
a majority of those persons who were directors at the beginning of such
period, where such newly elected or appointed directors constitute 30% or
more of the directors of the board of directors of GPU.
"Collateral FMB Supplemental Indentures" means, collectively, the ME
FMB Supplemental Indenture, the PE FMB Supplemental Indenture and the JC
FMB Supplemental Indenture.
"Collateral FMBs" means collectively, the ME Collateral FMBs, the PE
Collateral FMBs and the JC Collateral FMBs.
"Collateral Note Authorizations" means, collectively, the ME Note
Order, the PE Note Supplemental Indenture and the JC Note Order.
"Collateral Note Delivery Date" means, with respect to a Subsidiary
Borrower, the date Collateral Notes issued by such Subsidiary Borrower are
delivered to the Administrative Agent pursuant to Section 5.4(b).
"Collateral Note Documents" means, collectively, the Collateral
Notes, the Collateral Note Authorizations, the Note Indentures, the
Collateral FMBs, the Collateral FMB Supplemental Indentures and the FMB
Indentures.
"Collateral Notes" means, collectively, the ME Collateral Notes, the
PE Collateral Notes and JC Collateral Notes.
"Commitment" has the meaning specified in Section 2.1.
"Consolidation" refers to the consolidation of the accounts of a
Borrower and its Subsidiaries in accordance with generally accepted
accounting principles, including principles of consolidation, consistently
applied, and "consolidated" shall be construed accordingly.
"Conversion", "Convert" or "Converted" each refers to a conversion
of Advances pursuant to Section 2.2, including but not limited to any
selection of a longer or shorter Interest Period to be applicable to such
Advances.
"Debt" of any Person means (i) indebtedness for borrowed money,
(ii) obligations evidenced by bonds,
4
debentures, notes or other similar instruments, (iii) obligations to pay
the deferred purchase price of property or services, (iv) obligations as
lessee under leases which shall have been or should be, in accordance with
generally accepted accounting principles, recorded as capital leases, (v)
obligations under direct or indirect guaranties in respect of, and
obligations (contingent or otherwise) to purchase or otherwise acquire, or
otherwise to assure a creditor against loss in respect of, indebtedness or
obligations of others of the kinds referred to in clauses (i) through (iv)
above, (vi) liabilities in respect of unfunded vested benefits under
Plans, and (vii) withdrawal liability incurred under ERISA by such Person
or any of its Affiliates to any Multiemployer Plan.
"Debt Rating", with respect to any Subsidiary Borrower, means the
lower of such Subsidiary Borrower's Senior Secured Debt Ratings, and, with
respect to GPU, means the lower of GPU's Senior Unsecured Debt Ratings.
"Domestic Lending Office" means, with respect to any Lender, the
office of such Lender specified as its "Domestic Lending Office" opposite
its name on Schedule I hereto or such other office of such Lender as such
Lender may from time to time specify to the Borrowers and the
Administrative Agent.
"EI UK" means EI UK Holdings, Inc., a Delaware corporation and
indirect wholly owned subsidiary of GPU.
"EI UK Facility" means the (pound)245,000,000 Credit Agreement,
dated as of July 15, 1999, as amended, modified and supplemented from time
to time, among EI UK Holdings, Inc., Citibank International plc and the
lenders named therein.
"Eligible Assignee" means any of the following entities: (i) a
financial institution organized under the laws of the United States, or
any State thereof, and having total assets in excess of $1,000,000,000;
(ii) a financial institution organized under the laws of any other country
which is a member of the Organization for Economic Cooperation and
Development, or a political subdivision of any such country, and having
total assets in excess of $1,000,000,000, provided that such financial
institution is acting through a branch or agency located in the United
States; and (iii) any Lender and any affiliate of any Lender.
"ERISA" means the Employee Retirement Income Security Act of 1974,
as amended from time to time, and the regulations promulgated and rulings
issued thereunder.
5
"ERISA Affiliate" means, with respect to any Person, any trade or
business (whether or not incorporated) which is a "commonly controlled
entity" within the meaning of the regulations under Section 414 of the
Internal Revenue Code of 1986, as amended from time to time.
"ERISA Plan Termination Event" means (i) a Reportable Event
described in Section 4043 of ERISA and the regulations issued thereunder
(other than a Reportable Event not subject to the provision for 30-day
notice to the PBGC under such regulations) with respect to a Plan or a
Multiemployer Plan, or (ii) the withdrawal of a Borrower or any of its
ERISA Affiliates from a Plan or a Multiemployer Plan during a plan year in
which it was a "substantial employer" as defined in Section 4001(a)(2) of
ERISA, or (iii) the filing of a notice of intent to terminate a Plan or a
Multiemployer Plan or the treatment of a Plan or a Multiemployer Plan
under Section 4041 of ERISA, or (iv) the institution of proceedings to
terminate a Plan or a Multiemployer Plan by the PBGC, or (v) any other
event or condition which might constitute grounds under Section 4042 of
ERISA for the termination of, or the appointment of a trustee to
administer, any Plan or Multiemployer Plan.
"Escrow Agent" means United States Trust Company of New York, in its
capacity as escrow agent under the Escrow Agreement, and its successors
and assigns in such capacity.
"Escrow Agreement" means the Escrow Agreement, delivered pursuant to
Section 3.1(b), among ME, PE JC, the Administrative Agent and the Escrow
Agent, in substantially the form of Exhibit P, as amended, modified and
supplemented from time to time.
"Eurocurrency Liabilities" has the meaning assigned to that term 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, the
office of such Lender specified as its "Eurodollar Lending Office"
opposite its name on Schedule I hereto (or, if no such office is
specified, its Domestic Lending Office) or such other office of such
Lender as such Lender may from time to time specify to the Borrowers and
the Administrative Agent.
"Eurodollar Rate" means, with respect to any Eurodollar Rate Advance
for any Interest Period, the London interbank offered rate for dollar
deposits for a period equal in length to such Interest Period that appears
as of 11:00 A.M. (London time) on the second Business Day next preceding
the first day of such Interest Period on the display page designated as
Page 3750 on the Telerate Monitor
6
(or such other page or service as shall replace the Telerate Monitor for
the purposes of displaying the London interbank offered rate for dollar
deposits). If on the date on which the Administrative Agent shall seek to
determine the Eurodollar Rate for an Interest Period, no quotation is
given on Telerate Monitor page 3750, the Eurodollar Rate shall be equal to
an interest rate per annum (rounded upwards, if necessary, to the next 1/6
of 1%) equal to the rate at which dollar deposits approximately equal in
principal amount to the Administrative Agent's portion of such Borrowing,
and for a maturity comparable to such Interest Period are offered to the
principal London offices of Chase in immediately available funds in the
London interbank market at approximately 11:00 A.M., London time, two
Business Days prior to the commencement of such Interest Period.
"Eurodollar Rate Advance" means an Advance that bears interest as
provided in Section 2.7(a).
"Eurodollar Reserve Percentage" of any Lender for each Interest
Period for each Eurodollar Rate Advance means the reserve percentage
applicable during such Interest Period (or if more than one such
percentage shall be so applicable, the daily average of such percentages
for those days in such Interest Period during which any such percentage
shall be so applicable) under Regulation D or other 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, without limitation, any emergency, supplemental or other
marginal reserve requirement, without benefit of or credit for proration,
exemptions or offsets) for such Lender with respect to liabilities or
assets consisting of or including Eurocurrency Liabilities having a term
equal to such Interest Period.
"Event of Default" has the meaning specified in Section 6.1.
"Existing Credit Agreement" has the meaning assigned to that term in
the Preliminary Statements.
"External Line" means any arrangement (other than pursuant to this
Agreement or the Senior Debt Documents) with any commercial bank pursuant
to which such commercial bank has agreed (whether or not such agreement
shall constitute a committed facility or shall otherwise be legally
enforceable) to make unsecured loans or extend credit on an unsecured
basis to one or more Borrowers up to a specified amount either on a demand
basis or for periods of not in excess of 270 days or any similar financing
arrangement commonly known as a "line of credit".
7
"Facility Fee" means a fee which shall be payable on the aggregate
amount of the Commitments, irrespective of usage, quarterly in arrears, on
a 360-day basis, to each of the Lenders pro rata on the amount of their
respective Commitments. The Facility Fee will be determined with reference
to the basis points per annum set forth in the columns identified as ▇▇▇▇▇
▇, ▇▇▇▇▇ ▇, ▇▇▇▇▇ ▇, ▇▇▇▇▇ ▇, ▇▇▇▇▇ 5 or Level 6 and the Debt Ratings of
the Borrowers.
-------------------------------------------------------------------------------
▇▇▇▇▇ ▇ ▇▇▇▇▇ ▇ ▇▇▇▇▇ ▇
------- ------- -------
A or BBB- BB+ or
better ▇▇▇▇▇ ▇ ▇▇▇▇▇ ▇ ▇▇▇▇▇ ▇ ▇▇▇▇ below*
A2 or ------- ------- ------- Ba1 or
S&P better A- BBB+ BBB below*
▇▇▇▇▇'▇ A3 Baa1 Baa2
-------------------------------------------------------------------------------
Basis Points 08.50 10.00 12.50 15.00 20.00 40.00
-------------------------------------------------------------------------------
* or unrated
For purposes of determining the Level applicable to a Borrower, the Debt
Rating thereof shall control. The Facility Fee shall be determined with
reference only to the lowest Level (numerically highest) applicable to any
of the Borrowers pursuant to the preceding sentence. Any change in the
Facility Fee shall be effective as of the date on which the applicable
rating agency announces the applicable change in ratings.
"FE" means FirstEnergy Corp., an Ohio corporation.
"Federal Funds Rate" means, for any day, the weighted average of the
rates on overnight Federal funds transactions with members of the Federal
Reserve System arranged by Federal funds brokers, as released on the next
succeeding Business Day by the Federal Reserve Bank of New York, or, if
such rate is not so released for any day which is a Business Day, the
arithmetic average (rounded upwards to the next 1/100th of 1%), as
determined by Chase, of the quotations for the day of such transactions
received by Chase from three Federal funds brokers of recognized standing
selected by it. If for any reason Chase shall have determined (which
determination shall be conclusive absent manifest error) that it is unable
to ascertain the Federal Funds Rate for any reason, including the
inability of Chase to obtain sufficient quotations in accordance with the
terms hereof, the Base Rate shall be determined without regard to clause
(ii) of the definition of "Base Rate" until the circumstances giving rise
to such inability no longer exist. Any change in the Base Rate due to a
change in Chase's prime rate or the Federal Funds Rate shall be effective
on the effective date of such change in such prime rate or the Federal
Funds Rate, respectively.
8
"FE Merger" means the merger of GPU with FE pursuant to the
Agreement and Plan of Merger, dated August 8, 2000, between FE and GPU.
"FMB Indentures" means, collectively, the ME FMB Indenture, the PE
FMB Indenture and the JC FMB Indenture.
"FMB Trustee" means, with respect to any FMB Indenture, United
States Trust Company of New York, in its capacity as trustee under such
FMB Indenture, and its successors and assigns in such capacity.
"Information Memorandum" means the Confidential Information
Memorandum dated April 6, 2001 distributed by the Joint Lead Arrangers to
potential Lenders in connection with the syndication of this Agreement.
"Interest Period" means, for each Advance made as part of the same
Borrowing, the period commencing on the date of such Advance and ending on
the date of maturity of such Advance, as selected by the respective
Borrower of such Borrowing in the Notice of Borrowing relating thereto;
provided, however, that:
(i) the duration of the Interest Periods for all Advances
made as part of the same Borrowing shall be identical and shall be:
A. in the case of Eurodollar Rate Advances, 1, 2 or 3
months, and
B. in the case of Base Rate Advances, 90 days;
(ii) any Interest Period which commences before the Termination Date
and would otherwise end after such Termination Date shall end on such
Termination Date;
(iii) Interest Periods for Advances comprising part of the same
Borrowing shall be of the same duration;
(iv) if, with respect to any Eurodollar Rate Advance, there is no
numerically corresponding day in the calendar month that is 1, 2 or 3
months, as the case may be, after the first day of the Interest Period
therefor, the last day of the Interest Period for such Eurodollar Rate
Advance shall occur on the last Business Day of such calendar month; and
(v) 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, in the case of any Interest Period for a Eurodollar Rate
Advance,
9
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.
"JC Collateral FMBs" means the first mortgage bonds of JC issued to
the Note Trustee pursuant to the JC FMB Supplemental Indenture,
substantially in the form of Exhibit D.
"JC Collateral Notes" means the notes of JC issued to the
Administrative Agent pursuant to the JC Note Indenture, substantially in
the form of Exhibit E.
"JC FMB Indenture" means that certain Indenture, dated as of March
1, 1946, between JC and the FMB Trustee, as amended, modified and
supplemented from time to time.
"JC FMB Supplemental Indenture" means the Supplemental Indenture,
dated as of May 1, 2001, to the JC FMB Indenture, substantially in the
form of Exhibit F.
"JC Note Indenture" means the Indenture, dated as of July 1, 1999,
between JC and the Note Trustee, as amended, modified and supplemented
from time to time.
"JC Note Order" means the Order, dated May 4, 2001 delivered
pursuant to the JC Note Indenture, substantially in the form of Exhibit G.
"JC Security Event" means, at any time a Pennsylvania Security Event
has occurred and is continuing, the issuance by Moody's, S&P or Fitch
IBCA, Duff & ▇▇▇▇▇▇ of a rating for the long-term senior secured debt
securities of JC of Baa3, BBB- or BBB-, respectively, or lower.
"Lien" has the meaning specified in Section 5.2(a).
"Loan Documents" means this Agreement, Escrow Agreement and the
Collateral Note Documents; provided, however, that the Collateral Note
Documents to which any Subsidiary Borrower is a party shall cease to be
Loan Documents upon the surrender by the Administrative Agent of the
relevant Collateral Notes of such Subsidiary Borrower pursuant to Section
7.6.
"Majority Lenders" means at any time Lenders that, in the aggregate,
meet the following two criteria: (i) represent at least 66-2/3% of the
then aggregate unpaid principal amount of the Advances owing to Lenders,
and (ii) represent at least 66-2/3% of the Commitments. Determination of
the Majority Lenders (and of Lenders
10
satisfying criterion (i) or (ii) above for any other purpose hereunder)
shall be made by the Administrative Agent and shall be conclusive and
binding absent manifest error.
"ME Collateral FMBs" means the first mortgage bonds of ME issued to
the Note Trustee pursuant to the ME FMB Supplemental Indenture,
substantially in the form of Exhibit H.
"ME Collateral Notes" means the notes of ME issued to the
Administrative Agent pursuant to the ME Note Indenture, substantially in
the form of Exhibit I.
"ME FMB Indenture" means that certain Indenture, dated as of
November 1, 1944, between ME and the FMB Trustee, as amended, modified and
supplemented from time to time.
"ME FMB Supplemental Indenture" means the Supplemental Indenture,
dated as of May 1, 2001, to the ME FMB Indenture, substantially in the
form of Exhibit J.
"ME Note Indenture" means the Indenture, dated as of July 1, 1999,
between ME and the Note Trustee, as amended, modified and supplemented
from time to time.
"ME Note Order" means the Order, dated May _4, 2001, delivered
pursuant to the ME Note Indenture, substantially in the form of Exhibit K.
"Moody's" means ▇▇▇▇▇'▇ Investors Service, Inc. or any successor
thereto.
"Multiemployer Plan" means a "multiemployer plan" as defined in
Section 4001(a)(3) of ERISA maintained for employees of a Borrower or any
ERISA Affiliate of a Borrower.
"Non-Core Business Investments" means investments in Persons other
than Subsidiary Borrowers.
"Note" means a promissory note issued at the request of a Lender
pursuant to Section 2.12.
"Note Indentures" means, collectively the ME Note Indenture, the PE
Note Indenture and the JC Note Indenture.
"Note Trustee" means, with respect to any Note Indenture, United
States Trust Company of New York, in its capacity as trustee under such
Note Indenture, and its successors and assigns in such capacity.
"Notice of Borrowing" has the meaning specified in Section 2.1(b).
11
"PaPUC" means the Pennsylvania Public Utility Commission or any
governmental entity which may be substituted therefor.
"PBGC" means the Pension Benefit Guaranty Corporation or any
successor thereto.
"PE Collateral FMBs" means the first mortgage bonds of PE issued to
the Note Trustee pursuant to the PE FMB Supplemental Indenture,
substantially in the form of Exhibit L.
"PE Collateral Notes" means the notes of PE issued to the
Administrative Agent pursuant to the PE Note Supplemental Indenture,
substantially in the form of Exhibit M.
"PE FMB Indenture" means that certain Mortgage and Deed of Trust,
dated as of January 1, 1942, between PE and the FMB Trustee, as amended,
modified and supplemented from time to time.
"PE FMB Supplemental Indenture" means the Supplemental Indenture,
dated as of May 1, 2001, to the PE FMB Indenture, substantially in the
form of Exhibit N.
"PE Note Indenture" means the Indenture, dated as of April 1, 1999,
between PE and the Note Trustee, as amended, modified and supplemented
from time to time.
"PE Note Supplemental Indenture" means Supplemental Indenture No. 1,
dated as of May 1, 2001, to the PE Note Indenture, substantially in the
form of Exhibit O.
"Pennsylvania Security Event" means (i) a determination pursuant to
Section 5.4(a) or Section 7.6(a) that a PLR Rate Order is not a
Satisfactory Rate Order or (ii) the failure of the PaPUC to issue a PLR
Rate Order on or prior to June 15, 2001.
"Person" means an individual, partnership, corporation (including a
business 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 an employee benefit plan (other than a Multiemployer
Plan) maintained for employees of a Borrower or any ERISA Affiliate of a
Borrower and covered by Title IV of ERISA.
"PLR Rate Order" means a written order by the PaPUC in Docket No.
P-00001860 and Docket No. P-00001861.
12
"Prime Rate" means the rate of interest per annum publicly announced
from time to time by the Administrative Agent as its prime rate in effect
at its principal office in New York City; each change in the Prime Rate
shall be effective on the date such change is announced as effective.
"Pro-Forma Statements" means pro forma cash flow statements and a
pro forma debt schedule delivered to the Administrative Agent and the
Lenders pursuant to Section 5.4(a).
"Satisfactory Rate Order" means a PLR Rate Order (i) that GPU
certifies, no later than five Business Days following the issuance of such
order, to the Administrative Agent and the Lenders (A) will not result
through December 31, 2002 (after taking into account the impact of the PLR
Rate Order and any additional actions that each of ME, PE and JC has taken
and proposes to take in response to the PLR Rate Order and any cash
preservation actions that GPU proposes to take in response to the PLR Rate
Order, all as reflected in the Pro-Forma Statements) in (1) a material
deterioration in the levels of cash flows of any Borrower or GPU and its
Subsidiaries on a consolidated basis or (2) a material increase in the
level of debt of any Borrower or GPU and its Subsidiaries on a
consolidated basis from, in each case, those reflected in the Base Case
Cash Flow Statement, and (B) will provide, in the judgment of GPU, a
reasonable basis for ME and PE to access the capital markets as reflected
in the Pro-Forma Statements, and (ii) that Lenders representing at least
51% of the Commitments agree pursuant to Section 7.6(a) satisfies the
conditions described in subclauses (A) and (B) above.
"SEC" means the Securities and Exchange Commission or any
governmental entity which may be substituted therefor.
"Securitization Securities" means transition bonds issued pursuant
to the New Jersey Electric Discount and Energy Competition Act or the
Pennsylvania Electricity Generation Customer Choice and Competition Act if
(and only if) no recourse may be had to any Borrower (or to their
respective assets) for the payment of such obligations, other than for
failure to collect and pay over the rates, taxes and/or charges provided
for in such legislation to service such obligations.
"Security Event" means a Pennsylvania Security Event or a JC
Security Event.
"Senior Debt" means Debt of a Borrower under a Senior Debt Document,
and any extensions, renewals or refinancings of any such Debt, provided
that, in connection with any such extension, renewal or refinancing, the
principal amount of such Debt shall not be increased.
13
"Senior Debt Document" means any of those agreements and other
documents listed on Schedule III hereto (or under any indenture in which
the Debt is secured by first mortgage bonds referenced in Schedule III),
as amended or supplemented from time to time.
"Senior Secured Debt" means Debt of a Subsidiary Borrower that
constitutes the senior secured non-credit enhanced long-term debt of such
Subsidiary Borrower.
"Senior Secured Debt Ratings" of a Subsidiary Borrower means the
Senior Secured Debt ratings of such Subsidiary Borrower by S&P and
Moody's.
"Senior Unsecured Debt" means senior unsecured non-credit enhanced
long-term debt of GPU.
"Senior Unsecured Debt Ratings" means the Senior Unsecured Debt
ratings of GPU assigned by S&P and Moody's.
"S&P" means Standard & Poor's Ratings Group, a division of McGraw
Hill, or any successor thereto.
"Short-Term Debt Limit" has the meaning specified in Section 5.3(k).
"Significant Subsidiary" means any Subsidiary of a Borrower that, as
of any date of determination, accounts for more than 5% of the
consolidated assets of such Borrower.
"Sublimit" means (i) with respect to GPU, $100,000,000, (ii) with
respect to ME, $150,000,000, (iii) with respect to PE, $150,000,000 and
(iv) with respect to JC, $266,000,000, in each case, as such Sublimit may
be reduced pursuant to Section 2.5.
"Subordinated Debt" means subordinated Debt incurred by any
Subsidiary Borrower as a result of the borrowing of the proceeds of any
trust-originated or limited partnership-originated preferred securities by
such Subsidiary Borrower.
"Subsidiary" means, with respect to any Person, any corporation or
other entity of which more than 50% of (i) the outstanding capital stock
having ordinary voting power to elect a majority of the board of directors
of such corporation (irrespective of whether or not 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) or (ii) other
equity interest comparable to that described in the preceding clause (i),
is at the time directly or indirectly owned by such Person, by such Person
and one or more other Subsidiaries, or by one or more other Subsidiaries.
14
"Subsidiary Borrower" means each of JC, ME and PE.
"Termination Date" means the earliest to occur of (i) 91 days after
the delivery to the Administrative Agent of the ME Senior Notes and the PE
Senior Notes pursuant to Section 5.4(b); (ii) the effective time of the FE
Merger; (iii) October 31, 2001; and (iv) the "Termination Date" under, and
as defined in, the EI UK Facility.
"Total Capitalization" means the sum of (i) consolidated Debt of GPU
and its Subsidiaries (other than Securitization Securities excluded from
the computation of Adjusted Debt), plus (ii) the sum of the capital stock
(excluding treasury stock and capital stock subscribed for and unissued)
and surplus (including earned surplus, capital surplus, translation
adjustment and the balance of the current profit and loss account not
transferred to surplus) accounts of GPU and its Subsidiaries appearing on
a consolidated balance sheet of GPU and its Subsidiaries, in each case
prepared as of the date of determination in accordance with generally
accepted accounting principles consistent with those applied in the
preparation of the financial statements referred to in Section 4.1(e),
after eliminating all intercompany transactions and all amounts properly
attributable to minority interests, if any, in the stock and surplus of
subsidiaries.
"Unmatured Default" means the occurrence and continuance of an event
which, with the giving of notice or lapse of time, or both, would
constitute an Event of Default.
"Utility Act" means the Public Utility Holding Company Act of 1935,
as amended from time to time.
SECTION 1.2. Computation of Time Periods.
In this Agreement 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 means "to but excluding".
SECTION 1.3. Accounting Terms.
All accounting terms not specifically defined herein shall be construed in
accordance with generally accepted accounting principles consistent with those
applied in the preparation of the financial statements referred to in Sections
3.1(m) and 4.1(e).
15
ARTICLE II
AMOUNTS AND TERMS OF THE ADVANCES
SECTION 2.1. The Advances.
(a) Each Lender severally agrees, on the terms and conditions hereinafter
set forth, to make Advances to any Borrower from time to time on any Business
Day during the period from the date hereof until the Termination Date in an
aggregate amount as to all Borrowers not to exceed at any time outstanding the
amount set opposite such Lender's name on Schedule II hereof, as such amount may
be reduced pursuant to Section 2.5 or 6.2 (such Lender's "Commitment"). In no
event shall any Borrower be entitled to request or receive any Advance that
would cause (i) the aggregate principal amount of Advances outstanding hereunder
to exceed the aggregate of the Commitments for all of the Lenders or (ii) the
aggregate principal amount of Advances outstanding to such Borrower to exceed
the lesser of (A) such Borrower's Sublimit and (B) such Borrower's Short-Term
Debt Limit. Each Borrowing shall be in an aggregate amount not less than
$10,000,000 or in an integral multiple of $1,000,000 in excess thereof and shall
consist of Advances of the same Type made on the same day to any one Borrower by
the Lenders ratably according to their respective Commitments. Within the limits
of each Lender's Commitment, any Borrower may from time to time borrow, prepay
pursuant to Section 2.8(b) and reborrow under this Section 2.1(a).
(b) Each Borrowing shall be made on notice, given (i) in the case of a
Borrowing consisting of Eurodollar Rate Advances, not later than 10:30 A.M. (New
York City time) on the third Business Day prior to the date of the proposed
Borrowing; and (ii) in the case of a Borrowing consisting of Base Rate Advances,
not later than 10:30 A.M. (New York City time) on the day of the proposed
Borrowing, by any Borrower to the Administrative Agent, which shall give to each
Lender prompt notice thereof and of each other notice received from any Borrower
hereunder by telex, telecopy, cable or telephone, confirmed immediately in
writing. Each such notice of a Borrowing (a "Notice of Borrowing") shall be by
telex, telecopy, cable or telephone, confirmed immediately in a writing signed
by a duly authorized officer of such Borrower, in substantially the form of
Exhibit B hereto, specifying therein the name of the Borrower and the requested
(i) date of such Borrowing, (ii) Type of Advances comprising such Borrowing,
(iii) aggregate amount of such Borrowing, and (iv) Interest Period for each such
Advance. In the case of a proposed Borrowing comprised of Eurodollar Rate
Advances, the Administrative Agent shall promptly notify each Lender of the
applicable interest rate under Section 2.7(a) or (b). 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
such account in New York, New York as the Administrative Agent shall
16
designate, in same day funds, such Lender's ratable portion of such Borrowing.
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 designated in such Notice of
Borrowing to receive such Advances at the Administrative Agent's aforesaid
address in same day funds.
SECTION 2.2. Conversion of Advances.
Subject to compliance with the conditions precedent set forth in Section
3.2, any Borrower may from time to time elect to Convert one or more Advances on
the following terms and subject to the following conditions:
(a) Each such Conversion shall be made as to all Advances comprising a
single Borrowing, on notice given not later than 10:30 A.M. (New York City time)
on the third Business Day prior to the date of the proposed Conversion by such
Borrower to the Administrative Agent, which shall give to each Lender prompt
notice thereof. Each such notice of Conversion (a "Notice of Conversion") shall
be in substantially the form of Exhibit A hereto, specifying therein the
requested (i) date of such Conversion, (ii) Type of, and Interest Period
applicable to, the Advances proposed to be Converted, (iii) Type of Advances to
which such Advances are proposed to be Converted, (iv) in the case of a
Conversion resulting in Eurodollar Rate Advances, initial Interest Period to be
applicable to such Advances and (v) aggregate amount of Advances proposed to be
Converted. No Conversion may be requested by any Borrower hereunder unless made
in compliance with this Section 2.2.
(b) Eurodollar Rate Advances may not be Converted on a date other than the
last day of the Interest Period applicable to such Advance unless the
corresponding amounts, if any, payable to the Lenders pursuant to Section 2.9(d)
are paid contemporaneously with such Conversion.
SECTION 2.3. Advances Generally.
(a) Each Notice of Borrowing and Notice of Conversion shall be irrevocable
and binding on the Borrower giving it. In the case of any Borrowing or
Conversion (other than one comprised solely of Base Rate Advances), the Borrower
giving such Notice, if any, shall indemnify each Lender against any loss or
expense incurred by such Lender as a result of any failure of such Borrower to
fulfill on or before the date specified for such Borrowing or Conversion the
applicable conditions set forth in Article III, if any, including, without
limitation, any loss or expense incurred by reason of the liquidation or
reemployment 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.
17
(b) Unless the Administrative Agent shall have received notice from a
Lender prior to the date of any Borrowing that such Lender will not make
available to the Administrative Agent such Lender's ratable portion of such
Borrowing, the Administrative Agent may (but shall not be obligated to) assume
that such Lender has made such portion available to the Administrative Agent on
the date of such Borrowing in accordance with Section 2.1 hereof and the
Administrative Agent may, in reliance upon such assumption, make available to
the applicable Borrower on such date a corresponding amount. If and to the
extent such Lender shall not have so made such portion available to the
Administrative Agent, such Lender and such Borrower severally agree to repay to
the Administrative Agent forthwith on demand such corresponding amount together
with interest thereon, for each day from the date such amount is made available
to such Borrower until the date such amount is repaid to the Administrative
Agent, at the Federal Funds Rate. If such Lender shall repay to the
Administrative Agent such corresponding amount, such amount so repaid shall
constitute such Lender's Advance as part of such Borrowing for purposes of this
Agreement.
(c) 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 2.4. Fees.
(a) Facility Fee. The Borrowers agree to pay to the Administrative Agent
for the account of each Lender the Facility Fee from the date hereof until the
Termination Date, payable on the last day of each March, June, September and
December during the term of such Lender's Commitment, commencing June 30, 2001,
and on the Termination Date.
(b) Administration Fees. The Borrowers shall pay to the
Administrative Agent and Citibank, N.A. for their own accounts such other
fees as are provided for in those certain letter agreements among the
Borrowers and the Administrative Agent, and the Borrowers and Citibank, N.A.,
respectively, entered into separately herefrom and each dated April 5, 2001.
(c) Up-Front Fees. The Borrowers shall pay to the Administrative Agent for
the account of each Lender a fee of 12.50 basis points on the aggregate
Commitments, payable upon the execution of this Agreement.
(d) Fee Allocation Among Borrowers. The Borrowers' respective
obligations in respect of fees pursuant to this Section 2.4 and costs,
expenses and taxes pursuant to Section 8.4 shall be determined by agreement
among themselves and specified
18
in a certificate signed by the principal financial officer or the treasurer of
each Borrower delivered to the Administrative Agent on or prior to the date and
time of the initial Advance; such certificate shall be conclusively binding upon
each Borrower.
SECTION 2.5. Reduction of the Commitments and Sublimits.
The Borrowers shall have the right, upon at least three Business Days'
notice to the Administrative Agent, signed by a duly authorized officer of each
Borrower, to terminate in whole or reduce ratably in part the unused portions of
the Commitments of the Lenders or the unused portion of the Sublimit of any
Borrower; provided that that portion of any outstanding Advance that would
exceed the aggregate amount of the reduced Commitments must be prepaid, together
with any amount payable to the Lenders pursuant to Section 2.9, coincident with
such reduction, and provided, further, that each partial reduction of the
Commitments or any Sublimit shall be in an aggregate amount not less than
$5,000,000 or in an integral multiple of $1,000,000 in excess thereof. In
addition, upon any prepayment of Advances outstanding to GPU pursuant to Section
2.8(a), the GPU Sublimit shall be reduced by an amount equal to the principal
amount of such Advances so prepaid. The Administrative Agent shall promptly
notify each Lender of any such termination or reduction.
SECTION 2.6. Repayment of Advances.
Each Advance shall be due and payable in full on the Termination Date.
SECTION 2.7. Interest on Advances.
Each Borrower shall pay interest on the unpaid principal amount of each
Advance made by each Lender to such Borrower from the date of such Advance until
such principal amount shall be paid in full, on the following payment dates and
at the following rates per annum:
(a) Eurodollar Rate Advances. If such Advance is a Eurodollar Rate
Advance, a rate per annum equal at all times during the Interest Period for such
Advance to the sum of the Eurodollar Rate for such Interest Period plus the
Applicable Margin, payable on the last day of such Interest Period; provided
that any amount of principal (and, to the fullest extent permitted by law,
interest) which is not paid when due (whether at stated maturity, by
acceleration or otherwise) shall bear interest, from the date when due until
paid in full, payable on demand, at a rate per annum equal at all times to 2%
per annum plus the higher from time to time of (x) such rate of interest
applicable to such Advance immediately prior to such amount becoming due or (y)
the Base Rate in effect from time to time.
19
(b) Base Rate Advances. If such Advance is a Base Rate Advance, a rate per
annum equal at all times to the Base Rate in effect from time to time plus the
Applicable Margin, payable quarterly in arrears on the last day of each March,
June, September and December and on the date such Base Rate Advance shall be
paid in full; provided that any amount of principal (and, to the fullest extent
permitted by law, interest) which is not paid when due (whether at stated
maturity, by acceleration or otherwise) shall bear interest, from the date when
due until paid in full, payable on demand, at a rate per annum equal at all
times to 2% per annum plus the Base Rate in effect from time to time.
SECTION 2.8. Prepayments.
(a) Mandatory. In the event that any Pennsylvania Security Event shall
have occurred, then at all times thereafter (unless, in the case of an event
described in clause (ii) of the definition of "Pennsylvania Security Event", the
PaPUC subsequently issues a Satisfactory Rate Order), GPU shall prepay Advances
made to it or other similar indebtedness that is guaranteed by GPU, and the GPU
Sublimit and the commitments, if any, relating to such similar guaranteed
indebtedness, shall be permanently reduced, by an amount equal to the net cash
proceeds received by GPU or any of its Subsidiaries upon the sale of any equity
interests in or assets of any foreign utility company that is a direct or
indirect Subsidiary of GPU.
(b) Voluntary. Any Borrower may, upon at least (i) one Business Day's
notice, with respect to Base Rate Advances, and (ii) three Business Days'
notice, with respect to Eurodollar Rate, to the Administrative Agent stating the
proposed date and aggregate principal amount of the prepayment, and if such
notice is given, such Borrower shall, prepay the outstanding principal amounts
of Advances comprising part of the same Borrowing, in whole or ratably in part,
together with (A) accrued interest to the date of such prepayment on the
principal amount prepaid and (B) in the case of prepayments of Eurodollar Rate,
any amount payable to the Lenders pursuant to Section 2.9(d); provided, however,
that each partial prepayment shall be in an aggregate principal amount not less
than $5,000,000. The Administrative Agent shall promptly notify each Lender of
any such prepayment.
SECTION 2.9. Yield Protection.
(a) Change in Circumstances. Notwithstanding any other provision herein,
if, after the date hereof, the adoption of or any change in applicable law or
regulation or in the interpretation or administration thereof by any
governmental authority charged with the interpretation or administration thereof
(whether or not having the force of law) shall (i) change the basis of taxation
of payments to any Lender of the principal of or interest on any Eurodollar Rate
Advance made by such Lender
20
or any fees or other amounts payable hereunder (other than changes in respect of
taxes imposed on the overall net income of such Lender or its Applicable Lending
Office by the jurisdiction in which such Lender has its principal office or in
which such Applicable Lending Office is located or by any political subdivision
or taxing authority therein), or (ii) impose, modify or deem applicable any
reserve, special deposit or similar requirement against commitments or assets
of, deposits with or for the account of, or credit extended by, such Lender, or
(iii) impose on such Lender or the London interbank market any other condition
affecting this Agreement or Eurodollar Rate Advances made by such Lender, and
the result of any of the foregoing shall be to increase the cost to such Lender
of agreeing to make, making or maintaining any Advance or to reduce the amount
of any sum received or receivable by such Lender hereunder (whether of
principal, interest or otherwise), then the Borrowers will pay to such Lender
upon demand such additional amount or amounts as will compensate such Lender for
such additional costs incurred or reduction suffered. Prior to any Lender giving
notice to the Borrowers under this subsection (a), such Lender shall use
reasonable efforts to change the jurisdiction of its Applicable Lending Office,
if such change would avoid such additional costs or reduction and would not, in
the sole determination of such Lender, be otherwise disadvantageous to such
Lender.
(b) Capital. If any Lender shall have determined that the adoption after
the date hereof of any law, rule, regulation or guideline regarding capital
adequacy, or any change in any of the foregoing or in the interpretation or
administration of any of the foregoing by any governmental authority, central
bank or comparable agency charged with the interpretation or administration
thereof, or compliance by any Lender (or any Applicable Lending Office of such
Lender) or any Lender's holding company with any request or directive regarding
capital adequacy (whether or not having the force of law) of any such authority,
central bank or comparable agency, has or would have the effect of (i) reducing
the rate of return on such Lender's capital or on the capital of such Lender's
holding company, if any, as a consequence of this Agreement, the Commitment of
such Lender hereunder or the Advances made by such Lender pursuant hereto to a
level below that which such Lender or such Lender's holding company could have
achieved, but for such applicability, adoption, change or compliance (taking
into consideration such Lender's policies and the policies of such Lender's
holding company with respect to capital adequacy), or of (ii) increasing or
otherwise determining the amount of capital required or expected to be
maintained by such Lender or such Lender's holding company based upon the
existence of this Agreement, the Commitment of such Lender hereunder, the
Advances made by such Lender pursuant hereto and other similar such commitments,
agreements or assets, then from time to time the Borrowers shall pay to such
Lender upon demand such additional amount or amounts
21
as will compensate such Lender or such Lender's holding company for any such
reduction or allocable capital cost suffered. Prior to any Lender giving notice
to the Borrowers under this subsection (b), such Lender shall use reasonable
efforts to change the jurisdiction of its Applicable Lending Office, if such
change would avoid such reduction or allocable capital cost and would not, in
the sole determination of such Lender, be otherwise disadvantageous to such
Lender.
(c) Eurodollar Reserves. Each Borrower shall pay to each Lender upon
demand, so long as such Lender shall be required under regulations of the Board
of Governors of the Federal Reserve System to maintain reserves with respect to
liabilities or assets consisting of or including Eurocurrency Liabilities,
additional interest on the unpaid principal amount of each Eurodollar Rate
Advance of such Lender outstanding to such Borrower, from the date of such
Advance until such principal amount is paid in full, at an interest rate per
annum equal at all times to the remainder obtained by subtracting (i) the
Eurodollar Rate for the Interest Period for such Advance from (ii) the rate
obtained by dividing such Eurodollar Rate by a percentage equal to 100% minus
the Eurodollar Reserve Percentage of such Lender for such Interest Period. Such
additional interest shall be determined by such Lender and notified to the
Borrowers and the Administrative Agent.
(d) Breakage Indemnity. Each Borrower shall indemnify each Lender against
any loss, cost or reasonable expense which such Lender may sustain or incur as a
consequence of (i) any failure by such Borrower to fulfill on the date of any
Borrowing hereunder the applicable conditions set forth in Article III, (ii) any
failure by such Borrower to borrow or Convert any Advance hereunder after
irrevocable Notice of Borrowing or Notice of Conversion has been given pursuant
to Section 2.1 or 2.2, (iii) any payment, prepayment or Conversion of a
Eurodollar Rate Advance required or permitted by any other provision of this
Agreement or otherwise made or deemed made on a date other than the last day of
the Interest Period applicable thereto, (iv) any default in payment or
prepayment of the principal amount of any Advance or any part thereof or
interest accrued thereon, as and when due and payable (at the due date thereof,
by irrevocable notice of prepayment or otherwise) or (v) acceleration of the
maturity of any Advances due to the occurrence of any Event of Default,
including, in each such case, any loss or reasonable expense sustained or
incurred or to be sustained or incurred in liquidating or employing deposits
from third parties acquired to effect or maintain such Advance or any part
thereof as a Eurodollar Rate Advance. Such loss, cost or reasonable expense
shall include an amount equal to the excess, if any, as reasonably determined by
such Lender, of (A) its cost of obtaining the funds for the Advance being paid,
prepaid, Converted or not borrowed or Converted (based on the Eurodollar Rate)
for the period from the date of such payment, prepayment,
22
Conversion or failure to borrow or Convert to the last day of the Interest
Period for such Advance (or, in the case of a failure to borrow or Convert, the
Interest Period for such Advance which would have commenced on the date of such
failure) over (B) the amount of interest (as reasonably determined by such
Lender) that would be realized by such Lender in reemploying the funds so paid,
prepaid, Converted or not borrowed or Converted for such period or Interest
Period, as the case may be. For purposes of this subsection (d), it shall be
presumed that each Lender shall have funded each such Advance with a fixed-rate
instrument bearing the rates and maturities designated in the determination of
the interest rate for such Advance.
(e) Notices. A certificate of each Lender setting forth such Lender's
claim for compensation hereunder and the amount necessary to compensate such
Lender or its holding company pursuant to subsections (a) through (d) of this
Section 2.9 shall be submitted to the Borrowers and the Administrative Agent and
shall be conclusive and binding for all purposes, absent manifest error. The
applicable Borrower shall pay each Lender directly the amount shown as due on
any such certificate within 10 days after its receipt of the same. The failure
of any Lender to provide such notice or to make demand for payment under this
Section 2.9 shall not constitute a waiver of such Lender's rights hereunder;
provided that such Lender shall not be entitled to demand payment pursuant to
subsections (a) through (d) of this Section 2.9, in respect of any loss, cost,
expense, reduction or reserve, if such demand is made more than 90 days
following the later of such Lender's incurrence or sufferance thereof or such
Lender's actual knowledge of the event giving rise to such Lender's rights
pursuant to such subsections. The protection of this Section 2.9 shall be
available to each Lender regardless of any possible contention of the invalidity
or inapplicability of the law, rule, regulation, guideline or other change or
condition which shall have occurred or been imposed.
(f) Change in Legality. Notwithstanding any other provision herein, if the
adoption of or any change in any law or regulation or in the interpretation or
administration thereof by any governmental authority charged with the
administration or interpretation thereof shall make it unlawful for any Lender
to make or maintain any Eurodollar Rate Advance or to give effect to its
obligations as contemplated hereby with respect to any Eurodollar Rate Advance,
then, by written notice to the Borrowers and the Administrative Agent, such
Lender may:
(i) declare that Eurodollar Rate Advances will not thereafter be
made by such Lender hereunder, whereupon the right of the Borrowers to
select Eurodollar Rate Advances for any Borrowing or Conversion shall be
forthwith suspended until such Lender shall withdraw such notice as
provided below or shall cease to be a Lender hereunder pursuant to Section
8.8 hereof; and
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(ii) require that all outstanding Eurodollar Rate Advances made by
it be Converted to Base Rate Advances, in which event all such Eurodollar
Rate Advances by all Lenders shall be automatically Converted to Base Rate
Advances as of the effective date of such notice as provided below.
Upon receipt of any such notice, the Administrative Agent shall promptly notify
the other Lenders. Promptly upon becoming aware that the circumstances that
caused such Lender to deliver such notice no longer exist, such Lender shall
deliver notice thereof to the Borrowers and the Administrative Agent withdrawing
such prior notice (but the failure to do so shall impose no liability upon such
Lender). Promptly upon receipt of such withdrawing notice from such Lender (or
upon such Lender assigning all of its Commitments, Advances, participation and
other rights and obligations hereunder in accordance with Section 8.8), the
Administrative Agent shall deliver notice thereof to the Borrowers and the
Lenders and such suspension shall terminate. Prior to any Lender giving notice
to the Borrowers under this subsection (f), such Lender shall use reasonable
efforts to change the jurisdiction of its Applicable Lending Office, if such
change would avoid such unlawfulness and would not, in the sole determination of
such Lender, be otherwise disadvantageous to such Lender. Any notice to the
Borrowers by any Lender shall be effective as to each Eurodollar Rate Advance on
the last day of the Interest Period currently applicable to such Eurodollar Rate
Advance; provided that if such notice shall state that the maintenance of such
Advance until such last day would be unlawful, such notice shall be effective on
the date of receipt by the Borrowers and the Administrative Agent.
SECTION 2.10. Payments and Computations.
(a) Each Borrower shall make each payment hereunder in same day funds not
later than 12:00 noon (New York City time) on the day when due in U.S. dollars
(i) if to the Administrative Agent, then directly to the Administrative Agent,
and (ii) if to a Lender, then to the Administrative Agent, at its address
referred to in Section 8.2. The Administrative Agent will promptly thereafter
cause to be distributed like funds relating to the payment of principal or
interest or facility fees ratably (other than amounts payable pursuant to
Section 2.3 or 2.9) to the Lenders for the account of their respective
Applicable Lending Offices, and like funds relating to the payment of any other
amount payable to any Lender to such Lender for the account of its Applicable
Lending Office, in each case to be applied in accordance with the terms of this
Agreement.
(b) Each Borrower hereby authorizes each Lender, if and to the extent
payment owed to such Lender is not made when due hereunder, to charge from time
to time against any or all of such Borrower's accounts with such Lender any
amount so due.
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(c) All computations of interest based on the Prime Rate component of the
Base Rate shall be made by the Administrative Agent on the basis of a year of
365 or 366 days, as the case may be, for the actual number of days (including
the first day but excluding the last day) occurring in the period of
determination. All other computations of interest (including interest based on
the Federal Funds Rate component of the Base Rate, additional interest under
Section 2.9 and interest based on the Eurodollar Rate and the Federal Funds
Rate) and of the Facility Fee shall be made by the Administrative Agent (or, in
the case of Section 2.9, the Lender claiming such interest), on the basis of a
year of 360 days, for the actual number of days (including the first day but
excluding the last day) occurring in the period of determination. Each
determination by the Administrative Agent (or, in the case of Section 2.9, by a
Lender) of an interest rate and fees hereunder shall be conclusive and binding
for all purposes.
(d) Whenever any payment hereunder 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 of the Facility Fee, as the case may be;
provided, however, if such extension would cause payment of interest on or
principal of Eurodollar Rate Advances to be made in the next following calendar
month, such payment shall be made on the next preceding Business Day.
(e) Unless the Administrative Agent shall have received notice from any
Borrower prior to the date on which any payment from such Borrower is due to the
Lenders hereunder that such Borrower will not make such payment in full, the
Administrative Agent may assume that such Borrower has made such payment in full
to the Administrative Agent on such date and the Administrative Agent may, in
reliance upon such assumption, cause to be distributed to each Lender on such
due date an amount equal to the amount then due such Lender. If and to the
extent such Borrower shall not have so made such payment in full to the
Administrative Agent, each Lender shall repay to the Administrative Agent
forthwith on demand such amount distributed to such Lender together with
interest thereon, for each day from the date such amount is distributed to such
Lender until the date such Lender repays such amount to the Administrative
Agent, at the Federal Funds Rate.
SECTION 2.11. Sharing of Payments, Etc.
If any Lender shall obtain any payment (whether voluntary, involuntary,
through the exercise of any right of set-off or otherwise) on account of
principal or interest in respect of Advances owing to it or on account of any
fee, expense, indemnification or other obligation payable by a Borrower to such
Lender hereunder and the ratio of the amount of such payment (a "non-pro rata
payment") to the total amount of such principal,
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interest, fee, expense, indemnification or other obligation then payable to it
shall exceed the ratio of the amount of the payment substantially coincidentally
received by any other Lender for the account of principal or interest, in
respect of such other Lender's Advances owing to it, or such fee, expense,
indemnification or other obligation to the total amount of such principal,
interest, fee, expense, indemnification or other obligation then payable to such
other Lender by such Borrower (a Lender being entitled to assume, in the absence
of knowledge to the contrary, that a payment received from the Administrative
Agent pursuant to Section 8.4, or received from any Borrower pursuant to Section
2.9(e), is not a non-pro rata payment), such Lender shall forthwith purchase
from each such other Lender such participation or participations in the right of
each such other Lender to receive such principal, interest, fee, expense,
indemnification or other obligation from such Borrower as shall be necessary to
cause such purchasing Lender to share such non-pro rata payment ratably
(relative to the amounts of such principal, interest, fee, expense,
indemnification or other obligation payable at the date of the obtaining of such
non-pro rata payment to such Lender and each such other Lender, respectively,
unless the relevant Lenders shall agree as to another basis for sharing);
provided, however, that if all or any portion of such excess payment is
thereafter recovered from such purchasing Lender, such purchase from each Lender
shall be rescinded and such Lender shall repay to the purchasing Lender the
purchase price to the extent of such recovery together with an amount equal to
such Lender's ratable share (according to the proportion of (i) the amount of
such Lender's required repayment to (ii) the total amount so recovered from the
purchasing Lender) of any interest or other amount paid or payable by the
purchasing Lender in respect of the total amount so recovered. Each Borrower
agrees that any Lender so purchasing a participation from another Lender
pursuant to this Section 2.11 may, to the fullest extent permitted by law,
exercise all its rights of payment (including the right of set-off) with respect
to such participation as fully as if such Lender were the direct creditor of
such Borrower in the amount of such participation.
SECTION 2.12 Noteless Agreement; Evidence of Indebtedness.
(a) Each Lender shall maintain in accordance with its usual practice an
account or accounts evidencing the indebtedness of each Borrower to such Lender
resulting from each Advance made by such Lender from time to time, including the
amounts of principal and interest payable and paid to such Lender from time to
time hereunder.
(b) The Administrative Agent shall also maintain accounts in which it will
record (i) the amount of each Advance made hereunder, the Type thereof and the
Interest Period (if any) with respect thereto, (ii) the amount of any principal
or interest due and payable or to become due and payable from the relevant
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Borrower to each Lender hereunder, and (iii) the amount of any sum received by
the Administrative Agent hereunder from such Borrower and each Lender's share
thereof.
(c) The entries maintained in the accounts maintained pursuant to
subsections (a) and (b) above shall be prima facie evidence of the existence and
amounts of the obligations therein recorded; provided, however, that the failure
of the Administrative Agent or any Lender to maintain such accounts or any error
therein shall not in any manner affect the obligation of such Borrower to repay
such obligations in accordance with their terms.
(d) Any Lender may request that its Advances be evidenced by Notes. In
such event, the Borrowers shall each prepare, execute and deliver to such Lender
a Note payable to the order of such Lender. Thereafter, the Advances evidenced
by such Note and interest thereon shall at all times (including after any
assignment pursuant to Section 8.8) be represented by Notes from each Borrower,
payable to the order of the payee named therein or any assignee pursuant to
Section 8.8, except to the extent that any such Lender or assignee subsequently
returns any such Notes for cancellation and requests that such Borrowings once
again be evidenced as described in subsections (a) and (b) above.
ARTICLE III
CONDITIONS OF LENDING
SECTION 3.1. Conditions Precedent to Initial Borrowing.
The Lenders shall have no obligation to make an Advance as part of any
Borrowing pursuant to this Agreement unless and until the following conditions
precedent shall have been satisfied: (i) the representations and warranties
contained in Section 4.1 shall be correct on and as of the date of the initial
Borrowing, (ii) the Borrowers shall have paid all fees specified in Section 2.4,
and (iii) the Administrative Agent shall have received on or before the date of
the initial Borrowing the following, each dated such day, in form and substance
satisfactory to the Administrative Agent and (except for the notes described in
(a) and the FMB Indentures, of which only one copy need be delivered to the
Administrative Agent) in sufficient copies for each Lender:
(a) A Note from each Borrower, in form and substance approved by the
Administrative Agent, payable to each Lender that has requested one pursuant to
Section 2.12.
(b) Counterparts of the Escrow Agreement, duly executed by the Escrow
Agent, GPU, ME, PE and JC, together with evidence that the following documents
have been delivered to the Escrow Agent in accordance with the terms of the
Escrow Agreement:
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(i) the ME Collateral Notes, duly executed by ME and
authenticated by the Note Trustee, in the aggregate principal amount of
$150 million;
(ii) the PE Collateral Notes, duly executed by PE and authenticated
by the Note Trustee, in the aggregate principal amount of $150 million;
(iii) the JC Collateral Notes, duly executed by JC and authenticated
by the Note Trustee, in the aggregate principal amount of $266 million;
and
(iv) the PE Collateral FMBs, duly executed by PE and authenticated
by the FMB Trustee, in the aggregate principal amount of $420 million.
(c) A certified copy of the ME Note Order, duly executed by ME, together
with evidence that the Note Trustee shall have received the ME Note Order.
(d) A certified copy of the PE Note Supplemental Indenture, duly executed
by PE and the Note Trustee.
(e) A certified copy of the JC Note Order, duly executed by JC, together
with evidence that the Note Trustee shall have received the JC Note Order.
(f) Certified copies of the ME Collateral FMBs in the aggregate principal
amount of $150 million, duly executed by ME and authenticated by the FMB
Trustee, together with evidence that the Note Trustee shall have received the ME
Collateral FMBs.
(g) Certified copies of JC Collateral FMBs in the aggregate principal
amount of $266 million, duly executed by JC and authenticated by the FMB
Trustee, together with evidence that the Note Trustee shall have received the JC
Collateral FMBs.
(h) A certified copy of the ME Supplemental FMB Indenture, duly executed
by ME and the FMB Trustee.
(i) A certified copy of the PE Supplemental FMB Indenture, duly executed
by PE and the FMB Trustee.
(j) A certified copy of the JC Supplemental FMB Indenture, duly executed
by JC and the FMB Trustee.
(k) A certificate of the Secretary or Assistant Secretary of each
Subsidiary Borrower certifying that attached thereto are true and complete
copies of the FMB Indenture and the Note Indenture to which such Subsidiary
Borrower is a party.
(l) Copies of all certificates and opinions delivered by or on behalf
of the Note Trustee, the FMB Trustee and the Subsidiary
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Borrowers in connection with (i) the execution and delivery of the Collateral
Note Authorizations, the FMB Supplemental Indentures, the Collateral Notes and
the Collateral FMBs, (ii) the authentication by the Note Trustee of the
Collateral Notes and (iii) the authentication by the FMB Trustee of the
Collateral FMBs.
(m) Copies of (i) audited consolidated financial statements of each
Borrower and unaudited consolidating financial statements of GPU, in each case
dated as of December 31, 2000, and (ii) pro forma cash flow statements of the
Borrowers and GPU and its Subsidiaries on a consolidated basis and a pro forma
debt schedule of the Borrowers and GPU and its Subsidiaries on a consolidated
basis, with the assumption that the PaPUC issues a PLR Rate Order granting in
all material respects the relief sought by GPU which statements were included in
the Information Memorandum (the "Base Case Cash Flow Statement").
(n) Certified copies of the resolutions of the Board of Directors of each
Borrower approving each Loan Document to which such Borrower is, or is to be, a
party and of all documents evidencing other necessary corporate action and
governmental approvals, including, without limitation, appropriate orders of the
SEC under the Utility Act, with respect to the Loan Documents.
(o) A certificate of the Secretary or an Assistant Secretary of each
Borrower certifying the names and true signatures of the officers of each
Borrower authorized to sign each Loan Document to which such Borrower is, or is
to be, a party and the other documents to be delivered by it hereunder.
(p) Evidence that, upon application of the proceeds of the initial
Borrowing hereunder, the commitments of the lenders under the Bilateral
Agreements, other than those set forth in part B of Schedule IV hereto, shall
have been terminated, and the obligations of the Borrowers under the Bilateral
Agreements, other than those set forth in part B of Schedule IV hereto, shall
have been paid in full.
(q) A favorable opinion of ▇▇▇▇▇▇ ▇▇▇▇ & Priest LLP, counsel for the
Borrowers, substantially in the form of Exhibit Q hereto and as to such other
matters as any Lender through the Administrative Agent may reasonably request.
(r) A favorable opinion of King & Spalding, special counsel for the
Administrative Agent, substantially in the form of Exhibit R hereto.
(s) Evidence that, upon application of the proceeds of the initial
Borrowing hereunder, the commitments of the Existing Bank Group under the
Existing Credit Agreement shall have been terminated, and the obligations of the
Existing Bank Group shall have been paid in full.
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(t) Such other approvals, opinions and documents as the Administrative
Agent may reasonably request as to the legality, validity, binding effect or
enforceability of any Loan Document or the financial condition, properties,
operations or prospects of any Borrower.
SECTION 3.2. Conditions Precedent to Each Borrowing.
The obligation of each Lender to make an Advance as part of a Borrowing
(including the initial Borrowing hereunder) shall be subject to the further
conditions precedent that on the date of such Borrowing:
(a) the following statements shall be true (and each of the giving of the
applicable notice or request by any Borrower with respect to such Borrowing and
the performance of such Borrowing without prior correction by such Borrower
shall constitute a representation and warranty by such Borrower that, on the
date of such Borrowing, such statements are true):
(i) The representations and warranties contained in Section 4.1
(other than those contained in the last sentence of subsection (e) and in
subsection (m) thereof) are correct on and as of the date of such
Borrowing, before and after giving effect to such Borrowing and to the
application of the proceeds therefrom, as though made on and as of such
date;
(ii) No event has occurred and is continuing, or would result from
such Borrowing or from the application of the proceeds therefrom, which
constitutes an Event of Default or an Unmatured Default;
(iii) After giving effect to such Borrowing and the application of
the proceeds therefrom, such Borrower is in compliance with the applicable
limitations (if any) on the amount of indebtedness that may be incurred by
such Borrower contained in its charter; and
(b) the Borrowers shall have furnished to the Administrative Agent such
other approvals, opinions or documents as any Lender, through the Administrative
Agent, may reasonably request as to the legality, validity, binding effect or
enforceability of the Loan Documents.
SECTION 3.3. Conditions Precedent to Certain Borrowings.
The obligation of any Lender to make its Advance as part of a Borrowing
(including the initial Borrowing) that would (after giving effect to all
Borrowings on such date and the application of proceeds thereof) increase the
principal amount outstanding hereunder, or the outstanding principal amount of
the Advances
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hereunder shall be subject to the conditions precedent set forth in Section 3.2
and the further condition precedent that on the date of such Borrowing the
following statements shall be true (and each of the giving of the applicable
notice or request by any Borrower with respect to such Borrowing and the
performance of such Borrowing shall constitute a representation and warranty by
such Borrower that, on the date of such Borrowing, such statement is true):
(i) The representations and warranties contained in the last
sentence of subsection (e) and in subsection (m) of Section 4.1 are
correct on and as of the date of such Borrowing, before and after giving
effect to such Borrowing and to the application of the proceeds therefrom,
as though made on and as of such date; and
(ii) the Borrowers shall have furnished to the Administrative Agent
such other approvals, opinions or documents as any Lender, through the
Administrative Agent, may reasonably request as to the legality, validity,
binding effect or enforceability of the Loan Documents.
SECTION 3.4. Reliance on Certificates.
The Lenders and the Administrative Agent shall be entitled to rely
conclusively upon the certificates delivered from time to time by officers of
Borrowers as to the names, incumbency, authority and signatures of the
respective persons named therein until such time as the Administrative Agent may
receive a replacement certificate, in form acceptable thereto, from an officer
of such Borrower identified to the Administrative Agent as having authority to
deliver such certificate, setting forth the names and true signatures of the
officers and other representatives of such Borrower thereafter authorized to act
on behalf of such Borrower.
ARTICLE IV
REPRESENTATIONS AND WARRANTIES
SECTION 4.1. Representations and Warranties of the Borrowers.
Each Borrower represents and warrants with respect to itself as follows:
(a) Such Borrower is a corporation duly incorporated, validly existing and
in good standing under the laws of its jurisdiction of incorporation.
(b) The execution, delivery and performance by such Borrower of the Loan
Documents to which such Borrower is a party are within such Borrower's corporate
powers, have been duly authorized by all necessary corporate action, and do not
31
contravene (i) the Borrower's charter or by-laws or (ii) law or any material
contractual restriction binding on or affecting such Borrower, and do not result
in or require the creation of any Lien upon or with respect to any of its
properties, except as contemplated by and pursuant to the terms of the Loan
Documents.
(c) No authorization or approval or other action by, and no notice to or
filing with, any governmental authority or regulatory body is required for the
due execution, delivery and performance by such Borrower of this Agreement, the
Collateral Notes or the Collateral FMBs to which such Borrower is a party except
for an appropriate order of the SEC under the Utility Act which, on and as of
the date of the initial Borrowing hereunder and on and as of each date on which
this representation and warranty shall be deemed to be repeated, will be duly
obtained, in full force and effect, sufficient for its purpose and not subject
to any pending or, to the knowledge of any Borrower, threatened appeal or other
proceeding seeking reconsideration).
(d) Each Loan Document to which such Borrower is a party is the legal,
valid and binding obligation of such Borrower enforceable against such Borrower
in accordance with its terms.
(e) The audited balance sheets of such Borrower and its Subsidiaries as at
December 31, 2000, and the related audited statements of income and retained
earnings of such Borrower and its Subsidiaries for the fiscal year then ended,
together with the notes thereto, copies of which have been furnished to each
Lender, fairly present the financial condition of such Borrower and its
Subsidiaries as at such date and the results of the operations of such Borrower
and its Subsidiaries for the period ended on such date, all in accordance with
generally accepted accounting principles consistently applied. Except as
disclosed in such Borrower's Annual Report on Form 10-K for the fiscal year
ended December 31, 2000, since December 31, 2000, there has been no material
adverse change in such financial condition or results of operations.
(f) There has not been any failure by such Borrower to file at or prior to
the time required any reports or other filings with any regulatory authority
having jurisdiction over it that would materially adversely affect its business
or financial condition.
(g) No proceeds of any Advance will be used to acquire any security in any
transaction that is subject to the reporting requirements of Section 13 or 14 of
the Securities Exchange Act of 1934, as amended.
(h) Such Borrower is not in default, and no condition exists which with
notice or lapse of time or both would constitute a default, under any agreement
to which such Borrower is a party evidencing Debt with a principal amount equal
to or in excess of $20,000,000.
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(i) Such Borrower is not engaged in the business of extending credit for
the purpose of buying or carrying margin stock (within the meaning of Regulation
U issued by the Board of Governors of the Federal Reserve System), and no
proceeds of any Advance will be used to buy or carry any margin stock or to
extend credit to others for the purpose of buying or carrying any margin stock.
(j) GPU owns beneficially and of record, free and clear of all Liens, 100%
of the common stock of each Subsidiary Borrower.
(k) Following application of the proceeds of each Advance, not more than
25 percent of the value of the assets (either of a Borrower or of all Borrowers
or of a Borrower and its Subsidiaries on a consolidated basis or of all
Borrowers and their Subsidiaries on a consolidated basis) subject to the
provisions of Section 5.2(a) or (e) will be margin stock (within the meaning of
Regulation U issued by the Board of Governors of the Federal Reserve System).
(l) Neither any Borrower nor any of such Borrower's ERISA Affiliates has
incurred or reasonably expects to incur any material withdrawal liability under
ERISA to any Multiemployer Plan.
(m) Except as disclosed in such Borrower's Annual Report on Form 10-K for
the fiscal year ended December 31, 2000, copies of which have been delivered to
the Lenders, there is no pending or, to such Borrower's knowledge, threatened
action or proceeding affecting such Borrower or any of its Subsidiaries before
any court, governmental agency or arbitrator, which, in the case of GPU, could
reasonably be expected to materially adversely affect the financial condition or
operations of GPU or of GPU and its Subsidiaries, taken as a whole, or, in the
case of a Subsidiary Borrower, could reasonably be expected to materially
adversely affect the financial condition or operations of such Borrower or such
Borrower and its Subsidiaries, taken as a whole.
(n) No ERISA Plan Termination Event has occurred or is reasonably expected
to occur with respect to any Plan which reasonably could be expected to
materially adversely affect the business, operations, affairs, assets or
condition, financial or otherwise, or prospects of any Borrower on a
consolidated basis, or the ability of any Borrower to perform its obligations
hereunder.
(o) Such Borrower is not an "investment company" or a company "controlled"
by an "investment company", within the meaning of the Investment Company Act of
1940, as amended.
(p) The Base Case Cash Flow Statement delivered pursuant to Section 3.1(e)
was arrived at in good faith and based on reasonable assumptions, and as of the
date of its delivery, the
33
Information Memorandum, taken as a whole, was not misleading in any material
respect and did not omit to disclose any matter the failure of which to be
disclosed would result in any information contained therein, in light of the
circumstances under which they were made, being misleading in any material
respect.
ARTICLE V
COVENANTS OF THE BORROWERS
SECTION 5.1. Affirmative Covenants.
Each Borrower (except as expressly provided below in those covenants that
apply solely to GPU) covenants that it will, so long as any Advance or any other
amount owing hereunder shall remain unpaid or any Lender shall have any
Commitment hereunder, unless the Majority Lenders shall otherwise consent in
writing:
(a) Payment of Taxes, Etc. Pay and discharge all taxes, assessments and
governmental charges or levies imposed upon it or upon its income or profits, or
upon any properties belonging to it, prior to the date on which penalties attach
thereto, and all lawful claims which, if unpaid, might become a Lien upon any
properties of such Borrower, provided it shall not be required to pay any such
tax, assessment, charge, levy or claim which is being contested in good faith
and by proper proceedings.
(b) Performance and Compliance with Other Agreements. Perform and comply
with each of the material provisions of each material indenture, credit
agreement, contract or other agreement by which such Borrower is bound,
non-performance or non-compliance with which would have a material adverse
effect upon its business or credit or materially and adversely affect its
ability to perform its obligations hereunder except material contracts or other
agreements being contested in good faith.
(c) Preservation of Corporate Existence, Conduct of Business, Etc.
Preserve and maintain its corporate existence in the jurisdiction of its
incorporation, and qualify and remain qualified as a foreign corporation in good
standing in each jurisdiction in which such qualification is necessary or
desirable in view of its business and operations or the ownership of its
properties, except where the failure to be so qualified would not materially
adversely affect its financial condition, operations, properties or business,
preserve its material rights, franchises and privileges to conduct its business
substantially as conducted as of the date hereof and, at all times following the
delivery of the Pro-Forma Statements pursuant to Section 5.4(a), use reasonable
efforts to operate its business in a manner materially consistent with the
projections and proposed actions reflected for such Borrower in the Pro-Forma
Statements.
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(d) Compliance with Laws, Etc. Comply with the requirements of all
applicable laws, rules, regulations and orders of any governmental authority,
non-compliance with which would have a material adverse effect upon its business
or credit or materially and adversely affect its ability to perform its
obligations hereunder except laws, rules, regulations and orders being contested
in good faith.
(e) Maintenance of Insurance. Maintain insurance in effect at all times in
such amounts as are available to such Borrower and covering such risks as is
usually carried by companies of a similar size, engaged in similar businesses
and owning similar properties in the same general geographical area in which
such Borrower operates, either with responsible and reputable insurance
companies or associations, or, in whole or in part, by establishing reserves of
one or more insurance funds, either alone or with other corporations or
associations.
(f) Inspection Rights. At any reasonable time and from time to time,
permit the Administrative Agent or any Lender or any agents or representatives
thereof to examine and make copies of and abstracts from the records and books
of account of, and visit the properties of, such Borrower and to discuss the
affairs, finances and accounts of such Borrower with any of its officers or
directors.
(g Ownership of Subsidiary Borrowers. With respect to GPU, maintain at all
times beneficial ownership, free and clear of all Liens (except for those
described in Section 5.2(a)(iii)), of 100% of all outstanding shares of common
stock of each Subsidiary Borrower and of GPU Capital, Inc.
(h) Debt to Total Capitalization. With respect to GPU, maintain at
all times a ratio of Adjusted Debt to Total Capitalization of not more than
0.68 to 1.0.
(i) Use of Proceeds. Use the proceeds of Advances for working
capital purposes.
SECTION 5.2. Negative Covenants.
Each Borrower (except as expressly provided below in those covenants that
apply solely to GPU) covenants that it will not, so long as any Advance or any
other amount owing hereunder shall remain unpaid or any Lender shall have any
Commitment hereunder, without the prior written consent of the Majority Lenders:
(a) Liens, Etc. Create, incur, assume or suffer to exist any mortgage,
deed of trust, pledge, lien, security interest or other charge or encumbrance,
or any other type of preferential arrangement, upon or with respect to any of
its properties or rights, whether now owned or hereafter acquired (any of the
foregoing being referred to herein as a "Lien"), or assign any
35
right to receive income, services or property, except that the foregoing
restrictions shall not apply to any such assignments in connection with the
issuance of Securitization Securities or to Liens:
(i) existing on the date hereof;
(ii) created to secure any Senior Debt; provided, however, that no
Lien created to secure any Senior Debt shall extend to or cover property
of any type which is excluded therefrom on the date hereof;
(iii) for taxes, assessments or governmental charges or levies on
property of such Borrower if the same shall not at the time be delinquent
or thereafter can be paid without penalty, or are being contested in good
faith and by appropriate proceedings;
(iv) imposed by law, such as carriers', warehousemen's and
mechanics' Liens and other similar Liens arising in the ordinary course of
business;
(v) arising out of pledges or deposits (A) under workmen's
compensation laws, unemployment insurance, or other social security, or
similar legislation, or (B) to secure the performance of bids, tenders,
contracts (other than contracts for the payment of money), leases, surety
or similar bonds or other similar obligations, in each case under this
clause (B) made in the ordinary course of business in an amount not to
exceed $12,000,000 in the aggregate for all Borrowers at any one time
outstanding;
(vi) arising out of purchase money mortgages or other Liens on
property acquired by such Borrower in the ordinary course of business to
secure the purchase price of such property or to secure Debt incurred
solely for the purpose of financing the acquisition of any such property
to be subject to such Liens, or Liens existing on any such property at the
time of acquisition, or extensions, renewals or replacements of any of the
foregoing for the same or a lesser amount, provided that no such Lien
shall extend to or cover any property other than the property being
acquired, and no such extension, renewal or replacement shall extend to or
cover any property not theretofore subject to the Lien being extended,
renewed or replaced;
(vii) affecting the fuel used in the power generating
operations of any Borrower;
(viii) constituting attachment, judgment and other similar Liens
arising in connection with court proceedings, provided that the execution
or other enforcement of such Liens is effectively stayed and the claims
secured thereby
36
are being actively contested in good faith by proper proceedings or the
payment of which is covered in full (subject to customary deductible
amounts) by insurance maintained with responsible and reputable insurance
companies or associations and such applicable insurance company or
association has acknowledged its liability therefor in writing;
(ix) constituting easements, restrictions and other similar
encumbrances arising in the ordinary course of business, which in the
aggregate do not materially adversely affect such Borrower's use of its
properties; or
(x) in addition to the foregoing, securing amounts not to
exceed in the aggregate $75,000,000 for each Borrower at any one time
outstanding.
(b) Debt. Create, incur, assume or suffer to exist any Debt, except:
(i) Debt of such Borrower hereunder;
(ii) Debt directly secured by Liens permitted by
Section 5.2(a)(iii)-(vii);
(iii) Senior Debt or Debt of such Borrower in respect of
Securitization Securities or Subordinated Debt;
(iv) Debt of such Borrower under External Lines, commercial paper
and other forms of unsecured short-term indebtedness, such commercial
paper and such other unsecured short-term indebtedness having a stated
maturity not in excess of 270 days from the date of issuance; provided,
however, that the aggregate principal amount of all Debt under External
Lines of such Borrower, such unsecured commercial paper of such Borrower
and such other unsecured short-term indebtedness of such Borrower,
together with the unpaid principal amount of Advances to such Borrower,
shall not exceed at any time (A) in the case of any Borrower other than
GPU, such Borrower's Short-Term Debt Limit or such Borrower's Sublimit and
(B) in the case of GPU, the lesser of GPU's Short-Term Debt Limit and
$100,000,000;
(v) Debt which is expressly and effectively subordinated to the Debt
hereunder and, without limiting the generality of the foregoing, which
provides that, unless and until the Debt hereunder shall have been paid in
full, no payments of any kind, whether for principal, interest, premium,
fees, expenses or otherwise, shall be made in the event of an Event of
Default described in Section 6.1(e) or (f) below;
(vi) Debt arising from the purchase in the ordinary course of
its business as conducted on the date hereof of
37
fuel, supplies, equipment, services, electric energy and capacity with
respect to which no assertion that such Debt is delinquent in payment has
been made and outstanding for more than 60 days, unless such Borrower is
contesting such assertion in good faith and by appropriate proceedings;
(vii) Debt with respect to unfunded vested benefits under Plans or
withdrawal liability incurred under ERISA by a Borrower or any of its
ERISA Affiliates to any Multiemployer Plan;
(viii) Debt with respect to capital lease obligations;
(ix) any other unsecured Debt not to exceed, in the case of GPU (on
an unconsolidated basis), the aggregate amount of $2,000,000,000 at any
one time outstanding and, in the case of each of JC, PE and ME, the
aggregate amount of $200,000,000 at any one time outstanding;
(x) all Debt permitted pursuant to Section 5.2(c); and
(xi) other unsecured Debt not in excess of the amount otherwise
permitted under Section 5.1(h).
(c) Assumptions, Guaranties, Etc. of Debt of Other Persons. Assume,
guarantee, endorse or otherwise become directly or contingently liable
(including, without limitation, liable by way of agreement, contingent or
otherwise, to purchase, to provide funds for payment, to supply funds to or
otherwise invest in the debtor or otherwise to assure the creditor against
loss) in connection with any obligation or Debt of any other Person, except:
(i) guaranties by endorsement of negotiable instruments for
deposit or collection or similar transactions in the ordinary course of
business;
(ii) obligations to pay insurance premiums;
(iii) guaranties existing on the date hereof to the extent
permitted pursuant to Section 5.2(b)(x);
(iv) guaranties by ME, JC and PE of obligations of any Subsidiary of
such Borrower to the extent permitted pursuant to Section 5.2(b)(x);
(v) indemnifications of any Borrower or GPU Service, Inc. or
GPU Nuclear, Inc. for the benefit of suppliers and contractors of
property or services to any Borrower (other than GPU) with respect to
nuclear material and facilities;
(vi) guaranties or indemnifications by any Borrower issued in
the ordinary course of business of such Borrower
38
(and not covering the payment or performance of any Person's indebtedness
for borrowed money) such as self-insurance guaranties and those issued in
favor of surety companies issuing indemnity bonds, third party vendors or
customers to promote conservation of energy or cogeneration, stock
transfer agents, lessors or vendors of equipment, supplies or services;
and
(vii) guaranties by GPU of obligations of any Subsidiary of GPU
(only for so long as such Person is a Subsidiary of GPU) to the extent
permitted pursuant to Section 5.2(b)(x).
(d) Mergers, Etc. Merge or consolidate with any Person, unless:
(i) the surviving or resulting entity is a Borrower hereunder;
(ii) immediately after giving effect thereto no Event of Default or
Unmatured Default shall have occurred and be continuing; and
(iii) the senior unsecured debt of the surviving or resulting
Borrower shall be rated at least investment grade by S&P and/or ▇▇▇▇▇'▇.
(e) Sale of Assets, Etc. From the date hereof until the Termination Date,
GPU will not, and will not permit or cause any other Borrower to, sell,
transfer, lease, assign or otherwise convey or dispose of more than 10% of its
assets (whether now owned or hereafter acquired), in any single or series of
transactions, whether or not related, except for (i) dispositions of (A) assets
in connection with the issuance of Securitization Securities and (B) current
assets in the ordinary course of business as conducted on the date hereof, (ii)
dispositions of assets not exceeding 5% of such Borrower's assets in connection
with sale-leaseback transactions relating to such assets, (iii) conveyances of
assets from one Borrower to another and (iv) dispositions of any generating and
related assets of any Borrower listed on Schedule I hereto, provided that before
and after giving effect to any such disposition, no Event of Default under
Section 6.1(a) shall have occurred and be continuing.
(f) Constituent Documents, Etc. GPU will not, and will not permit or cause
any other Borrower to, (i) change in any material respect, the nature of its
business, charter, certificate of incorporation or other similar document,
accounting policies or accounting practices (except as required or permitted by
the Financial Accounting Standards Board or generally accepted accounting
principles) (it being agreed that such portion of any change to a charter,
certificate of incorporation or other similar document that provides for the
issuance of equity shall
39
not be claimed material) or (ii) cease to engage in the business of the same
general type as conducted by such Borrower on May 1, 2001.
(g) Dividends. If a Security Event shall have occurred and be continuing,
GPU will not declare or pay any dividend on its common stock other than the
dividend declared on April 5, 2001 and scheduled to be paid on or about May 30,
2001.
(h) Non-core Investments. Make Non-Core Business Investments in amounts
that, in the aggregate, materially exceed the Non-Core Business Investments
contemplated in the Base Case Cash Flow Statement. If a Security Event shall
have occurred and be continuing, GPU will not make, or cause or permit its
Subsidiaries to make, any Non-Core Business Investments except those for which
contractual commitments exist as of the date of the issuance of a PLR Rate Order
that is not a Satisfactory Rate Order.
(i) Capital Contributions. If a Security Event shall have occurred
and be continuing, GPU will not make any contribution of capital or loan to
ME or PE in excess of $50,000,000 in the aggregate.
SECTION 5.3. Reporting Requirements.
Each Borrower covenants that it will, so long as any Advance or any other
amount owing hereunder shall remain unpaid or any Lender shall have any
Commitment hereunder, unless the Majority Lenders shall otherwise consent in
writing, furnish to each Lender:
(a) as soon as possible and in any event within three days after the
occurrence of each Event of Default and each Unmatured Default, the statement of
the chief financial officer or Vice President and Treasurer of such Borrower
setting forth details of such Event of Default or Unmatured Default and the
action which such Borrower proposes to take with respect thereto;
(b) as soon as available and in any event within sixty days after the end
of each of the first three quarters of each fiscal year of such Borrower, a
balance sheet of such Borrower as of the end of such quarter and statements of
income and retained earnings and of source and application of funds of such
Borrower (in the case of GPU, on a consolidated and consolidating basis) for the
3-month and 12-month periods ending with the end of such quarter, setting forth
in each case in comparative form the corresponding figures as of the end of and
for the 3-month and the 12-month periods ending on the corresponding date of the
preceding fiscal year, all in reasonable detail and duly certified (subject to
year-end audit adjustments) by the chief financial officer or Vice President and
Treasurer of such Borrower as having been prepared in accordance with generally
40
accepted accounting principles consistently applied, together with a certificate
of said officer stating that said officer has no knowledge that an Event of
Default or an Unmatured Default has occurred and is continuing or, if an Event
of Default or an Unmatured Default has occurred and is continuing, a statement
as to the nature thereof and the action which such Borrower proposes to take
with respect thereto;
(c) as soon as available and in any event within ninety days after the end
of each fiscal year of each Borrower, a copy of the annual audit report for such
year for such Borrower including therein a balance sheet as of the end of such
fiscal year and statements of income and retained earnings and of source and
application of funds of such Borrower (in the case of GPU, on a consolidated and
consolidating basis) for such fiscal year, in each case certified (except for
the consolidating financial statements) by PriceWaterhouseCoopers, L.L.P. or
other independent public accountants of recognized standing acceptable to the
Majority Lenders as having been prepared in accordance with generally accepted
accounting principles consistently applied together with a certificate of (i)
such accounting firm to the Lenders stating that in the course of its audit of
the business of such Borrower, which audit was conducted by such accounting firm
in accordance with generally accepted auditing standards, such accounting firm
has obtained no knowledge that an Event of Default or an Unmatured Default
relating to financial or accounting matters has occurred and is continuing, or
if, in the opinion of such accounting firm, such an Event of Default or an
Unmatured Default has occurred and is continuing, a statement as to the nature
thereof and (ii) the chief financial officer or Vice President and Treasurer of
such Borrower corresponding to the certificate referred to in the last clause of
Section 5.3(b);
(d) within thirty days after the filing thereof, copies of all Annual
Reports on Form 10-K (or successor form), Quarterly Reports on Form 10-Q (or
successor form), and reports on Form 8-K (or successor form) of the Borrowers
filed with the SEC;
(e) as soon as possible and in any event within three Business Days of the
occurrence of a material adverse change in the financial position, operations or
prospects of such Borrower, the statement of the chief financial officer or Vice
President and Treasurer of such Borrower setting forth the details of such
change, the anticipated effects thereof and the action which such Borrower
proposes to take with respect thereto;
(f) as soon as possible and in any event (A) within thirty days after a
Borrower knows or has reason to know, or a Borrower has knowledge that any of
its ERISA Affiliates knows or has reason to know, that any ERISA Plan
Termination Event described in clause (i) of the definition of ERISA Plan
Termination Event with respect to any Plan has occurred and (B) within ten days
after a Borrower knows or has reason to know, or a Borrower has
41
knowledge that any of its ERISA Affiliates knows or has reason to know, that any
other ERISA Plan Termination Event with respect to any Plan has occurred, a
statement of the chief financial officer or Vice President and Treasurer of such
Borrower describing such ERISA Plan Termination Event and the action, if any,
which such Borrower or such ERISA Affiliate proposes to take with respect
thereto;
(g) promptly and in any event within five Business Days after receipt
thereof by a Borrower from the PBGC, or within five Business Days after a
Borrower has knowledge of the receipt thereof by any of its ERISA Affiliates,
copies of each notice received by such Borrower or such ERISA Affiliate of the
PBGC's intention to terminate any Plan or to have a trustee appointed to
administer any such Plan;
(h) as soon as possible and in any event within three Business Days after
any Borrower acquires knowledge of the filing of any appeal of, or petition
seeking modification or setting aside of, any order of the SEC under the Utility
Act obtained by the Borrowers in connection with this Agreement, notice of such
appeal or petition together with a copy thereof, if available;
(i) such other information respecting the business, properties or the
condition or operations, financial or otherwise, of such Borrower as any Lender
may through the Administrative Agent from time to time reasonably request;
(j) as soon as possible and in any event within three Business Days after
any Borrower acquires knowledge thereof, notice of any change in the Debt Rating
or in any credit rating used to determine the Debt Rating;
(k) as soon as possible and in any event within three Business Days after
any Borrower acquires knowledge thereof, notice of any change in the short-term
debt borrowing limit prescribed by the SEC for such Borrower under the Utility
Act (such Borrower's "Short-Term Debt Limit"); and
(l) together with the financial statements delivered pursuant to
subsections (b) and (c) above, a certificate of the Chief Financial Officer or
Vice President and Treasurer of GPU setting forth in reasonable detail the
calculations used in determining compliance by each Borrower with Sections
5.1(h) and 5.2(b)(ix) as of the last day of the period or periods covered by
such financial statements.
SECTION 5.4. Delivery of Pro-Forma Statements, PLR Rate Order,
Collateral Notes and Collateral FMBs.
(a) No later than five Business Days following the issuance of a PLR Rate
Order, GPU shall deliver to the Administrative Agent and the Lenders (i) a copy
of the PLR Rate Order, (ii) a
42
pro forma cash flow statement, through December 2002, and a pro forma debt
schedule, through December 2002, taking into effect the PLR Rate Order,
substantially in same form as the Base Case Cash Flow Statement, (iii) if GPU
believes that the PLR Rate Order satisfies the criteria set forth in subclauses
(A) and (B) of clause (i) of the definition of "Satisfactory Rate Order", the
certificate described in such definition, and (iv) if GPU does not believe that
the PLR Rate Order satisfies such criteria, a statement to that effect;
(b) Immediately upon the occurrence of a Pennsylvania Security Event, the
Administrative Agent shall cause, pursuant to the terms of the Escrow Agreement,
the Escrow Agent to deliver (i) to the Administrative Agent, for the ratable
benefit of the Lenders, the ME Collateral Notes and the PE Collateral Notes, and
(ii) to the Note Trustee, for the ratable benefit of the holders of all senior
notes issued under the PE Note Indenture, the PE FMBs. In addition, immediately
upon the occurrence of a JC Security Event, the Administrative Agent shall
cause, pursuant to the terms of the Escrow Agreement, the Escrow Agent to
deliver to the Administrative Agent, for the ratable benefit of the Lenders, the
JC Collateral Notes. On and after any Collateral Note Delivery Date, the
Collateral Notes delivered to the Administrative Agent on such Collateral Note
Delivery Date shall be registered in the name of the Administrative Agent and
shall be owned and held by the Administrative Agent, subject to the provisions
of this Agreement and the relevant Collateral Note Authorization, for the
benefit of the Lenders, and the Borrowers shall have no interest therein. On and
after the Collateral Note Delivery Date, the Administrative Agent shall be
entitled to exercise all rights of a noteholder under the relevant Note
Indenture with respect to the Collateral Notes delivered to the Administrative
Agent. Any payments received by the Administrative Agent on account of the
principal of or interest on the Collateral Notes shall be distributed by the
Administrative Agent in accordance with the applicable provisions of this
Agreement and the relevant Collateral Note Authorization, and each of the
Subsidiary Borrowers hereby consents to such distribution. Notwithstanding the
foregoing, in the event that prior to delivery of any Collateral Notes of ME or
JC hereunder, ME or JC is able to sell senior notes issued under such Subsidiary
Borrower's Note Indenture, then the Administrative Agent and the Lenders agree
that to the extent that such Subsidiary Borrower does not otherwise have
available issuance capacity under its Note Indenture, the Lenders will
relinquish their right hereunder to the delivery of such amount of Collateral
Notes issued by such Subsidiary Borrower, and the Administrative Agent shall
cause, pursuant to the terms of the Escrow Agreement, the Escrow Agent to
deliver such amount of Collateral Notes to the Note Trustee for cancellation;
and
(c) Immediately upon a determination pursuant to subsection (a) above
and Section 7.6(a) that a PLR Rate Order issued on or
43
before June 15, 2001 is a Satisfactory Rate Order, the Administrative Agent
shall cause, pursuant to the terms of the Escrow Agreement, the Escrow Agent to
deliver the Collateral Notes to the Note Trustee for cancellation and to deliver
the PE FMBs to the FMB Trustee for cancellation, and the Administrative Agent
and the Lenders shall thereafter have no right to the delivery of the Collateral
Notes hereunder.
ARTICLE VI
EVENTS OF DEFAULT
Section 6.1. Events of Default.
As to a Borrower, any of the following events shall constitute an Event of
Default ("Event of Default") if it occurs and is continuing:
(a) Such Borrower shall fail to make any payment of principal of any
Advance when due or of interest thereon or fees within five days after such
interest or fees shall have become due; or
(b) Any representation or warranty or written statement made by such
Borrower (or any of its officers) in any Loan Document or in connection with any
Loan Document or in any schedule, certificate or other document delivered
pursuant to or in connection with any Loan Document shall prove to have been
incorrect in any material respect when made; or
(c) Such Borrower shall fail to perform or observe the covenants set forth
in Section 5.1(g), Section 5.1(h), Section 5.2, Section 5.3(a) or Section 5.4 or
such Borrower shall fail to perform or observe any other term, covenant or
agreement contained herein on its part to be performed or observed and any such
failure shall remain unremedied for thirty days after written notice thereof
shall have been given by the Administrative Agent or any Lender to such Borrower
(and, if such notice was given by a Lender, to the Administrative Agent); or
(d) Such Borrower shall (i) fail to pay any Debt which is outstanding in a
principal amount of at least $20,000,000 in the aggregate (but excluding Debt
hereunder) of such Borrower, or premium or interest thereon, when due (whether
by scheduled maturity, required prepayment, acceleration, demand or otherwise),
and such failure shall continue after the applicable grace period, if any,
specified in the agreement or instrument relating to such Debt, or (ii) fail to
perform or observe any term, covenant or agreement on its part to be observed
under any agreement or instrument relating to any such Debt, when required to be
performed or observed, and such failure shall continue after the applicable
grace period, if any, specified in the
44
agreement or instrument, if the effect of such failure to perform or observe is
to accelerate, or to permit the acceleration of, the maturity of such Debt; or
any such Debt shall be declared to be due and payable, or required to be prepaid
(other than by a regularly scheduled required prepayment or pursuant to any
notice of optional redemption with respect thereto), prior to the stated
maturity thereof; or
(e) Such Borrower or any Significant Subsidiary of a Borrower shall
generally not pay its debts as such debts become due or shall admit in writing
its inability to pay its debts generally or shall make a general assignment for
the benefit of creditors or shall institute any proceeding or voluntary case
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, custodian or other similar official
for it or for any substantial part of its property or such Borrower or
Significant Subsidiary shall take any corporate action to authorize any of the
actions described in this subsection (e); or
(f) Any proceeding shall be instituted against such Borrower or any
Significant Subsidiary of a Borrower 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, custodian or other similar official for it or for any substantial part
of its property and such proceeding shall remain undismissed or unstayed for a
period of 60 days; or
(g) A final judgment or order for the payment of money in excess of
$20,000,000 shall be rendered against such Borrower and such judgment or order
shall continue unsatisfied and in effect for a period of thirty consecutive days
(excluding therefrom any period during which enforcement of such judgment or
order shall be stayed, whether by pendency of appeal, posting of adequate
security or otherwise); or
(h) Any ERISA Plan Termination Event shall have occurred with respect to a
Plan which could reasonably be expected to result in a material liability to
such Borrower, and, 30 days after notice thereof shall have been given to such
Borrower by the Administrative Agent or any Lender, such ERISA Plan Termination
Event shall still exist; or
(i) A Change in Control shall have occurred.
45
SECTION 6.2. Declaration by the Administrative Agent.
If any Event of Default described in subsection (a), (b), (c), (d), (g),
(h) or (i) of Section 6.1 with respect to a Borrower or in subsection (e) and
(f) of Section 6.1 with respect to a Borrower or any Significant Subsidiary of a
Borrower shall occur and be continuing with respect to a Borrower, then, and in
any such event, the Administrative Agent (A) shall at the request, or may with
the consent, of the Lenders having at least 66-2/3% of the Commitments, by
notice to such Borrower and any one or more of the other Borrowers, declare the
obligation of each Lender to make Advances to such Borrower to be terminated,
whereupon the same shall immediately terminate; and/or (B) shall at the request,
or may with the consent, of the Lenders owed at least 66-2/3% of the then
aggregate unpaid principal amount of the Advances owing to Lenders, by notice to
such Borrower, declare the Advances made to such Borrower, all interest thereon
and all other amounts payable by such Borrower under this Agreement to be
forthwith due and payable, whereupon such Advances, all such interest and all
such amounts shall become and be immediately due and payable, without
presentment, demand, protest or further notice of any kind, all of which are
hereby expressly waived by each Borrower; and if any Event of Default described
in subsection (e) or (f) of Section 6.1 shall occur and be continuing with
respect to a Borrower, then (i) the obligation of each Lender to make Advances
to the Borrowers shall automatically immediately terminate and (ii) the Advances
made to such Borrower, all interest thereon and all other amounts payable by
such Borrower under this Agreement 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 each Borrower and/or (iii) if any
Collateral Notes of such Borrower have been delivered to the Administrative
Agent pursuant to Section 5.4(b), shall at the request, or may with the consent,
of Lenders representing at least 66-2/3% of the Commitments exercise any right
or remedy (including, without limitation, rights of redemption) available to the
Administrative Agent in its capacity as a holder of such Collateral Notes.
ARTICLE VII
THE ADMINISTRATIVE AGENT
SECTION 7.1. Authorization and Action.
Each Lender hereby appoints and authorizes the Administrative Agent to
take such action as agent on its behalf and to exercise such powers under the
Loan Documents as are delegated to the Administrative Agent by the terms hereof
and the other Loan Documents, together with such powers as are reasonably
incidental thereto. As to any matters not expressly provided for by this
Agreement (including, without limitation, enforcement or collection of the
Advances or any of the Collateral Note Documents), the Administrative Agent
shall not be required to exercise any discretion or take any action, but shall
be required
46
to act or to refrain from acting (and shall be fully protected in so acting or
refraining from acting) upon the instructions of the Majority Lenders, and such
instructions shall be binding upon all Lenders; provided, however, that the
Administrative Agent shall not be required to take any action which exposes the
Administrative Agent to personal liability or which is contrary to this
Agreement or applicable law; provided further, that the Administrative Agent
shall not enter into any amendment or waiver of any provision of any Collateral
Note Document, nor consent to any departure by any party thereto therefrom,
unless authorized or directed by, or with the consent of, Lenders representing
that percentage of the Commitments and/or holding that percentage of Advances
that would be required to effect such amendment, waiver or consent under Section
8.1, with each reference to Section 8.1 to "this Agreement" and words of like
importance being deemed to be a reference to "any Collateral Note Document".
SECTION 7.2. Reliance on the Administrative Agent, Etc.
Neither the Administrative Agent, nor any of its directors, officers,
agents or employees shall be liable for any action taken or omitted to be taken
by it or them under or in connection with this Agreement, except for its own
gross negligence or willful misconduct. Without limitation of the generality of
the foregoing, the Administrative Agent: (i) may consult with legal counsel
(including counsel for the Borrowers), independent public accountants (including
the Borrowers' independent public accountants) and other experts selected by the
Administrative Agent 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; (ii) make no warranty or representation to any Lender
and shall not be responsible to any Lender for any statements, warranties or
representations made in or in connection with the Loan Documents; (iii) shall
not have any duty to ascertain or to inquire as to the performance or observance
of any of the terms, covenants or conditions of any Loan Document on the part of
any Borrower or to inspect the property (including the books and records) of any
Borrower; (iv) shall not be responsible to any Lender for the due execution,
legality, validity, enforceability, genuineness, sufficiency or value of any
Loan Document or any other instrument or document furnished pursuant hereto; and
(v) shall incur no liability under or in respect of any Loan Document by acting
upon any notice, consent, certificate or other instrument or writing (which may
be by telegram, telecopy, cable or telex) believed by the recipient to be
genuine and signed or sent by the proper party or parties.
SECTION 7.3. Chase and its Affiliates.
With respect to its Commitment and the Advances made by it , Chase shall
have the same rights and powers under this Agreement as any other Lender and may
exercise the same as though it were
47
not the Administrative Agent; and the term "Lender" or "Lenders" shall, unless
otherwise expressly indicated, include Chase in its individual capacity. Chase
and its Affiliates may accept deposits from, lend money to, act as trustee under
indentures of, and generally engage in any kind of business with, any Borrower,
any of its Subsidiaries and any Person who may do business with or own
securities of any Borrower or any such Subsidiary, all as if Chase were not the
Administrative Agent without any duty to account therefor to the Lenders.
SECTION 7.4. Indemnification.
The Lenders agree to indemnify the Administrative Agent (to the extent not
reimbursed by any Borrower), ratably, from and against any and all liabilities,
obligations, losses, damages, penalties, actions, judgments, suits, costs,
expenses or disbursements of any kind or nature whatsoever which may be imposed
on, incurred by, or asserted against the Administrative Agent in any way
relating to or arising out of this Agreement or any action taken or omitted by
the Administrative Agent under this Agreement, 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
from the gross negligence or willful misconduct of the indemnitee. Without
limitation of the foregoing, each Lender agrees to reimburse the Administrative
Agent promptly upon demand for its ratable share of any out-of-pocket expenses
(including counsel fees) incurred by the Administrative Agent in connection with
the preparation, execution, administration or enforcement (whether through
negotiations, legal proceedings or otherwise) of, or legal advice in respect of
rights or responsibilities under, this Agreement, to the extent that the
Administrative Agent is not reimbursed for such expenses by any Borrower. For
purposes of this Section 7.4, ratable allocations among the Lenders shall be
made (i) in respect of any demand by the Administrative Agent prior to a
declaration made pursuant to Section 6.2, according to the respective amounts of
their Commitments and (ii) thereafter according to the respective principal
amounts of the Advances then outstanding to them.
SECTION 7.5. Successor Administrative Agent.
The Administrative Agent may resign at any time by giving written notice
thereof to the Lenders and each Borrower and may be removed at any time as the
Administrative Agent under this Agreement with or without cause by the Majority
Lenders. Upon any such resignation or removal, the Majority Lenders shall have
the right to appoint a successor Administrative Agent, which shall be a
commercial bank organized under the laws of the United States of America or of
any State thereof and having a combined capital and surplus of at least
$1,000,000,000, and to which the Borrowers shall have consented in writing, such
consent not to be
48
unreasonably denied. If no successor Administrative Agent shall have been so
appointed by the Majority Lenders, and shall have accepted such appointment,
within thirty days after the giving of notice of resignation or the Majority
Lenders' removal of the retiring Administrative Agent, then the retiring
Administrative Agent may, on behalf of the Lenders, appoint a successor
Administrative Agent, which shall be a commercial bank organized under the laws
of the United States of America or of any State thereof and having a combined
capital and surplus of at least $1,000,000,000 and to which the Borrowers shall
have consented in writing, such consent not to be unreasonably denied. Upon the
acceptance of any appointment as Administrative Agent hereunder by a successor
Administrative Agent, such successor Administrative Agent shall thereupon
succeed to and become vested with all the rights, powers, privileges and duties
of the retiring Administrative Agent, and the retiring Administrative Agent
shall be discharged from its duties and obligations as Administrative Agent
under this Agreement. After any retiring Administrative Agent's resignation or
removal hereunder as Administrative Agent, 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 the Administrative Agent under this Agreement.
SECTION 7.6 Determinations by Lenders; No Transfer of Collateral Notes;
Surrender of Collateral Notes.
(a) Each Lender agrees to advise the Administrative Agent, no later than
ten Business Days following the delivery by GPU pursuant to Section 5.4(a) of a
certificate to the effect that the PLR Rate Order satisfies the criteria set
forth in subclauses (A) and (B) of clause (i) of the definition of "Satisfactory
Rate Order", whether such Lender, in its reasonable judgment, concurs with the
statements set forth in such certificate, it being understood that the failure
of any Lender to advise the Administrative Agent whether such Lender concurs
shall be deemed to constitute concurrence with the statements set forth in such
certificate.
(b) The Administrative Agent shall not sell, assign or otherwise transfer
any Collateral Notes delivered to it under this Agreement except to a successor
Administrative Agent under this Agreement.
(c) The Administrative Agent shall promptly surrender to or upon the order
of each Subsidiary Borrower all Collateral Notes issued by such Borrower and
held by the Administrative Agent upon the termination of all Commitments
hereunder and the payment of all Advances of such Subsidiary Borrower and other
amounts payable hereunder.
(d) Upon any reduction of a Subsidiary Borrower's Sublimit pursuant to
Section 2.5, and upon request by such Subsidiary Borrower, the Administrative
Agent shall promptly surrender to or
49
upon the order of such Subsidiary Borrower Collateral Notes of such Subsidiary
Borrower in principal amount equal to the amount by which such Collateral Notes
exceed such Sublimit, after giving effect to the reduction.
ARTICLE VIII
MISCELLANEOUS
SECTION 8.1. Amendments, Etc.
Except as otherwise provided in this Agreement, no amendment or waiver of
any provision of this Agreement, nor consent to any departure by any Borrower
therefrom, shall in any event be effective unless the same shall be in writing
and signed by the Majority Lenders, and then such waiver or consent shall be
effective only in the specific instance and for the specific purpose for which
given; provided, however, that no amendment, waiver or consent shall, unless in
writing and signed by all the Lenders, do any of the following: (i) waive any of
the conditions specified in Section 3.1, 3.2 or 3.3 (if and to the extent that
the Borrowing that is the subject of such waiver would involve an increase in
the aggregate outstanding amount of Advances over the aggregate amount of
Advances outstanding immediately prior to such Borrowing), (ii) increase the
Commitments of any Lender or subject any Lender to any additional obligations,
(iii) reduce the principal of, or interest on, or any fees or other amounts
payable hereunder, (iv) postpone any date fixed for any payment of principal of,
or interest on, any Advance or any fees or other amounts payable hereunder, (v)
change the percentage of the Commitments or of the aggregate unpaid principal
amount of any Advance, or the number of Lenders, that shall be required for the
Lenders or any of them to take any action hereunder, (vi) extend the Termination
Date, (vii) amend this Section 8.1; or (viii) authorize the Administrative Agent
to return, or to authorize or direct the return of, the Collateral Notes to the
issuer thereof, other than in compliance with Section 5.4(c) or 7.6; provided,
further, that no amendment, waiver or consent shall, unless in writing and
signed by the Administrative Agent in addition to the Lenders required above to
take such action, affect the rights or duties of the Administrative Agent under
or any Loan Document; provided, further, that this Agreement may be amended and
restated without the consent of any Lender or the Administrative Agent if, upon
giving effect to such amendment and restatement, such Lender or the
Administrative Agent, as the case may be, shall no longer be a party to this
Agreement (as so amended and restated) or have any Commitment or other
obligation hereunder and shall have been paid in full all amounts payable
hereunder to such Lender or the Administrative Agent, as the case may be.
SECTION 8.2. Notices, Etc.
All notices and other communications provided for hereunder shall be in
writing (including telegraphic, telecopy, telex or
50
cable communication) and mailed, telegraphed, telecopied, telexed, cabled or
delivered, if to:
(i) GPU, at its address at ▇▇▇ ▇▇▇▇▇▇▇ ▇▇▇▇▇▇, ▇▇▇▇▇▇▇▇▇▇,
▇▇▇ ▇▇▇▇▇▇ ▇▇▇▇▇-▇▇▇▇, Attention: Vice President and Treasurer;
(ii) JC, at its address at ▇▇▇▇ ▇▇▇▇▇▇▇▇▇▇ ▇▇▇▇, ▇▇▇▇▇▇▇, ▇▇
▇▇▇▇▇-▇▇▇▇, Attention: Vice President and Treasurer;
(iii) ME, at its address at ▇▇▇▇ ▇▇▇▇▇▇▇▇▇▇ ▇▇▇▇, ▇▇▇▇▇▇▇, ▇▇
▇▇▇▇▇-▇▇▇▇, Attention: Vice President and Treasurer;
(iv) PE, at its address at ▇▇▇▇ ▇▇▇▇▇▇▇▇▇▇ ▇▇▇▇, ▇▇▇▇▇▇▇, ▇▇
▇▇▇▇▇-▇▇▇▇, Attention: Vice President and Treasurer;
(v) any Lender, at its Domestic Lending Office; and
(vi) the Administrative Agent, at its address at 1 Chase
▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇, ▇▇▇ ▇▇▇▇▇, ▇▇▇ ▇▇▇▇, ▇▇▇ ▇▇▇▇ ▇▇▇▇▇, Attention: ▇▇▇▇▇
▇▇▇▇▇▇▇▇▇, Loan and Agency Group;
or, as to each party, at such other address as shall be designated by such party
in a written notice to the other parties. All such notices and communications
shall, when mailed, telegraphed, telecopied, telexed or cabled, be effective
when deposited in the mails, delivered to the telegraph company, sent by
telecopier, confirmed by telex answerback or delivered to the cable company,
respectively, except that notices and communications to the Administrative Agent
pursuant to Article II or VII and Section 8.8 shall not be effective until
received by the Administrative Agent.
SECTION 8.3. No Waiver; Remedies.
No failure on the part of any Lender or the Administrative Agent to
exercise, and no delay in exercising, any right hereunder shall operate as a
waiver thereof; nor shall any single or partial exercise of any such right
preclude any other or further exercise thereof or the exercise of any other
right. The remedies herein provided are cumulative and not exclusive of any
remedies provided by law.
SECTION 8.4. Costs, Expenses and Taxes.
(a) The Borrowers agree to indemnify the Administrative Agent and each
Lender from and against any and all liabilities, obligations, losses, damages,
penalties, actions, judgments, suits, costs, expenses (including counsel fees
(i) incurred by the Administrative Agent in connection with the preparation,
51
execution or administration or (ii) incurred by the Administrative Agent or any
Lender in connection with the enforcement, (whether through negotiations, legal
proceedings or otherwise) of, or legal advice in respect of rights or
responsibilities under, this Agreement) or disbursements of any kind or nature
whatsoever that may be imposed on, incurred by, or asserted against the
Administrative Agent or any Lender in any way relating to or arising out of the
Loan Documents or any action taken or omitted by the Administrative Agent or any
Lender hereunder, except for such liabilities, obligations, losses, damages,
penalties, actions, judgments, suits, costs, expenses or disbursements resulting
from the gross negligence or willful misconduct of the Person seeking such
indemnity.
(b) (i) Any and all payments made by any Borrower under any Loan Document
shall be made free and clear of and without deduction for any and all
present or future taxes, levies, imposts, deductions, charges or
withholdings, and all liabilities with respect thereto, excluding, in the
case of each of the Administrative Agent, taxes imposed on its income, and
franchise taxes imposed on it, by the jurisdiction under the laws of which
the Administrative Agent, is organized and by any political subdivision
thereof and, in the case of each Lender, taxes imposed on its income, and
franchise taxes imposed on it, by the jurisdiction of such Lender's
Lending Office and any political subdivision thereof (all such
non-excluded taxes, levies, imposts, deductions, charges, withholdings and
liabilities being hereinafter referred to as "Taxes"). If any Borrower
shall be required by law to deduct any Taxes from or in respect of any sum
payable under any Loan Document to the Administrative Agent or any Lender
(each, a "Beneficiary"), (A) the sum payable shall be increased as may be
necessary so that after making all required deductions (including
deductions applicable to additional sums payable under this subsection
(b)) such Beneficiary receives an amount equal to the sum it would have
received had no such deductions been made, (B) such Borrower shall make
such deductions and (C) such Borrower shall pay the full amount deducted
to the relevant taxation authority or other authority in accordance with
applicable law.
(ii) In addition, each Borrower agrees to pay any present or future
stamp or documentary taxes or any other excise or property taxes, charges
or similar levies that arise from any payment made hereunder or from the
execution, delivery or registration of, or otherwise with respect to, the
Loan Documents (hereinafter referred to as "Other Taxes").
(iii) The applicable Borrower will indemnify each Beneficiary for
the full amount of Taxes or Other Taxes (including, without limitation,
any Taxes or Other Taxes
52
imposed by any jurisdiction on amounts payable under this subsection (b))
paid by such Beneficiary on account of such Borrower and any liability
(including penalties, interest and expenses) arising therefrom or with
respect thereto, whether or not such Taxes or Other Taxes were correctly
or legally asserted. This indemnification shall be made within 30 days
from the date such Beneficiary makes written demand therefor.
(iv) Within 30 days after the date of any payment of Taxes, the
applicable Borrower will furnish to the Administrative Agent, at its
address referred to in Section 8.2 hereof, the original or a certified
copy of a receipt evidencing payment thereof.
(v) Without prejudice to the survival of any other agreement of the
Borrowers hereunder, the agreements and obligations of the Borrowers
contained in this Section 8.4(b) shall survive the termination or
expiration of the Commitments and the payment in full of the Advances and
all interest thereon.
SECTION 8.5. Right of Set-off.
Upon (i) the occurrence and during the continuance of any Event of Default
as to a Borrower and (ii) the making of the request or the granting of the
consent specified by Section 6.2 to authorize the Administrative Agent to
declare the Advances of such Borrower due and payable pursuant to the provisions
of Section 6.2, each Lender is hereby authorized at any time and from time to
time, without notice to such Borrower (any such notice being expressly waived by
each Borrower) to the fullest extent permitted by law, to set off and apply any
and all deposits (general or special, time or demand, provisional or final) at
any time held and other indebtedness at any time owing by such Lender to or for
the credit or the account of such Borrower against any and all of the
obligations of such Borrower now or hereafter existing under any Loan Document
to which Borrower is a party, irrespective of whether or not such Lender shall
have made any demand under such Loan Document and although such obligations may
be contingent and unmatured. Each Lender agrees promptly to notify such Borrower
after any such set-off and application made by such Lender, provided that the
failure to give such notice shall not affect the validity of such set-off and
application. The rights of each Lender under this Section are in addition to
other rights and remedies (including, without limitation, other rights of
set-off) that such Lender may have.
SECTION 8.6 Lender Credit Decisions.
Each Lender acknowledges that it has, independently and without reliance
upon the Administrative Agent or any other Lender and based on the financial
information referred to in
53
Sections 3.1(e) and 4.1(e) and such other documents and information as it has
deemed appropriate, made its own credit analysis and decision to enter into this
Agreement. Each Lender also acknowledges that it will, independently and without
reliance upon the Administrative Agent or any other Lender and based on such
documents and information as it shall deem appropriate at the time, continue to
make its own credit decisions in taking or not taking action under this
Agreement.
SECTION 8.7. Effectiveness; Binding Effect.
This Agreement shall become effective (i) when it shall have been executed
by the Borrowers and the Administrative Agent and when the Administrative Agent
shall have been notified by each Lender that such Lender has executed it and
(ii) upon the satisfaction of the conditions precedent to the initial Borrowing
set forth in Section 3.1 and thereafter this Agreement shall be binding upon and
inure to the benefit of the Borrowers, the Administrative Agent and each Lender
and their respective successors and permitted assigns, except that no Borrower
shall have the right to assign its rights or obligations hereunder or any
interest herein without the prior written consent of the Lenders.
SECTION 8.8 Assignments and Participations.
(a) Each Lender may assign to one or more Lenders or other entities all or
a portion of its rights and obligations under the Loan Documents (including,
without limitation, all or a portion of its Commitment and the Advances owing to
it); provided, however, that (i) each such assignment shall be of a constant,
and not a varying, percentage of the assigning Lender's rights and obligations
under the Loan Documents, (ii) the amount of the Commitment of the assigning
Lender being assigned pursuant to each 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 and shall be an integral multiple of
$1,000,000, (iii) each such assignment shall be to an Eligible Assignee, and
(iv) the parties to each such assignment shall execute and deliver to the
Administrative Agent, for its acceptance, an Assignment and Acceptance, and
(other than in connection with an assignment by a Lender to one of its
Affiliates) a processing and recordation fee of $3,000. Upon such execution,
delivery and acceptance, from and after the effective date specified in each
Assignment and Acceptance, (A) 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 hereunder and (B) the Lender 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 and be released from
its obligations under this Agreement (and, in the case of an
54
Assignment and Acceptance covering all or the remaining portion of an assigning
Lender's rights and obligations under this Agreement, such Lender shall cease to
be a party hereto).
(b) By executing and delivering an Assignment and Acceptance, the Lender
assignor thereunder and the assignee thereunder confirm to and agree with each
other and the other parties hereto as follows: (i) other than as provided in
such Assignment and Acceptance, such assigning Lender makes no representation or
warranty and assumes no responsibility with respect to any statements,
warranties or representations made in or in connection with the Loan Documents
or any other instrument or document furnished pursuant hereto or the execution,
legality, validity, enforceability, genuineness, sufficiency or value of the
Loan Documents or any other instrument or document furnished pursuant hereto;
(ii) such assigning Lender makes no representation or warranty and assumes no
responsibility with respect to the financial condition of any Borrower or the
performance or observance by any Borrower of any of its obligations under any
Loan Document or any other instrument or document furnished pursuant hereto;
(iii) such assignee confirms that it has received a copy of this Agreement,
together with copies of the financial statements referred to in Section 4.1 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 or any other Lender and based on
such documents and information as it shall deem appropriate at the time,
continue to make its own credit decisions in taking or not taking action under
the Loan Documents; (v) such assignee confirms that it is an Eligible Assignee;
(vi) such assignee appoints and authorizes the Administrative Agent to take such
action as agent on its behalf and to exercise such powers under this Agreement
as are delegated to the Administrative Agent by the terms hereof, together with
such powers as are reasonably incidental thereto; and (vii) such assignee agrees
that it will perform in accordance with their terms all of the obligations which
by the terms of this Agreement are required to be performed by it as a Lender.
(c) The Administrative Agent shall maintain at its address referred to in
Section 8.2 a copy of each Assignment and Acceptance delivered to and accepted
by it. Such copies shall be available for inspection by the Borrowers and any
Lender at any reasonable time and from time to time upon reasonable prior
notice.
(d) Upon its receipt of an Assignment and Acceptance executed by an
assigning Lender and an assignee, the Administrative Agent shall, if such
Assignment and Acceptance has been completed and is in substantially the form of
Exhibit C hereto, (i) accept such Assignment and Acceptance, and (ii) give
prompt notice thereof to the Borrowers.
55
(e) No assignment of all or a portion of a Commitment under paragraph (a)
of this Section 8.8 may be effected by a Lender to any Person that is not an
Affiliate of such Lender unless, prior to such assignment, each Borrower shall
have consented in writing to such Person receiving such assignment under this
Section 8.8 (such consent shall (i) not be required during the continuance of an
Event of Default or an Unmatured Default; and (ii) not be unreasonably
withheld).
(f) Each Lender may sell participations to one or more banks or other
entities in or to all or a portion of its rights and obligations under the Loan
Documents (including, without limitation, all or a portion of its Commitment and
the Advances owing to it); provided, however, that (i) such Lender's obligations
under this Agreement (including, without limitation, its Commitment to the
Borrowers hereunder) shall remain unchanged, (ii) such Lender shall remain
solely responsible to the other parties hereto for the performance of such
obligations, (iii) the Borrowers, the Administrative Agent and the other Lenders
shall continue to deal solely and directly with such Lender in connection with
such Lender's rights and obligations under this Agreement and (iv) the grantee
of any such participation, other than an Affiliate of such Lender, shall not be
entitled to direct such Lender to take or omit to take any action hereunder,
except action that pursuant to Section 8.1 would require the consent of all the
Lenders.
(g) Any Lender may, in connection with any assignment or participation or
proposed assignment or participation pursuant to this Section 8.8, disclose to
the assignee or participant or proposed assignee or participant, any information
relating to any Borrower furnished to such Lender by or on behalf of such
Borrower; provided that, prior to any such disclosure, the assignee or
participant or proposed assignee or participant, if not an Eligible Assignee,
shall agree to preserve the confidentiality of any confidential information
relating to such Borrower received by it from such Lender.
(h) Anything in this Section 8.8 to the contrary notwithstanding, any
Lender may assign and pledge all or any portion of the Advances owing to it to
any Federal Reserve Bank (and its transferees) as collateral security pursuant
to Regulation A of the Board of Governors of the Federal Reserve System and any
Operating Circular issued by such Federal Reserve Bank. No such assignment shall
release the assigning Lender from its obligations hereunder. Notwithstanding any
such assignment, the Borrowers shall continue to deal exclusively with the
Administrative Agent and the assigning Lender with respect to all matters
arising under this Agreement.
(i) Notwithstanding anything to the contrary contained herein, any Lender
(a "Granting Lender") may grant to a special purpose funding vehicle (an "SPC")
of such Granting Lender
56
identified as such in writing from time to time by the Granting Lender to the
Administrative Agent and the Borrowers, the option to provide to the Borrowers
all or any part of any Advance that such Granting Lender would otherwise be
obligated to make to the Borrowers pursuant to this Agreement; provided that (i)
nothing herein shall constitute a commitment by any such SPC to make any
Advance, (ii) if such SPC elects not to exercise such option or otherwise fails
to provide all or any part of such Advance, the Granting Lender shall be
obligated to make such Advance pursuant to the terms hereof and (iii) no SPC or
Granting Lender shall be entitled to receive any greater amount pursuant to
Section 2.10 or 8.4(b) than the Granting Lender would have been entitled to
receive had the Granting Lender not otherwise granted such SPC the option to
provide any Advance to any Borrower. The making of an Advance by an SPC
hereunder shall utilize the Commitment of the Granting Lender to the same
extent, and as if, such Advance were made by such Granting Lender. Each party
hereto hereby agrees that no SPC shall be liable for any indemnity or similar
payment obligation under this Agreement for which a Lender would otherwise be
liable so long as, and to the extent that, the related Granting Lender provides
such indemnity or makes such payment. In furtherance of the foregoing, each
party hereto hereby agrees (which agreement shall survive the termination of
this Agreement) that, prior to the date that is one year and one day after the
payment in full of all outstanding commercial paper or other senior indebtedness
of any SPC, it will not institute against or join any other person in
instituting against such SPC any bankruptcy, reorganization, arrangement,
insolvency or liquidation proceedings under the laws of the United States or any
State thereof. Notwithstanding the foregoing, the Granting Lender
unconditionally agrees to indemnify the Borrowers, the Administrative Agent and
each Lender against all liabilities, obligations, losses, damages, penalties,
actions, judgments, suits, costs, expenses or disbursements of any kind or
nature whatsoever which may be incurred by or asserted against any Borrower, the
Administrative Agent or such Lender, as the case may be, in any way relating to
or arising as a consequence of any such forbearance or delay in the initiation
of any such proceeding against its SPC. Each party hereto hereby acknowledges
and agrees that no SPC shall have the rights of a Lender hereunder, such rights
being retained by the applicable Granting Lender. Accordingly, and without
limiting the foregoing, each party hereby further acknowledges and agrees that
no SPC shall have any voting rights hereunder and that the voting rights
attributable to any Advance made by an SPC shall be exercised only by the
relevant Granting Lender and that each Granting Lender shall serve as the
administrative agent and attorney-in-fact for its SPC and shall on behalf of its
SPC receive any and all payments made for the benefit of such SPC and take all
actions hereunder to the extent, if any, such SPC shall have any rights
hereunder. In addition, notwithstanding anything to the contrary contained in
this Agreement any SPC may (i) with notice to, but without the prior written
consent of any other
57
party hereto, assign all or a portion of its interest in any Advances to the
Granting Lender and (ii) disclose on a confidential basis any information
relating to its Advances to any rating agency, commercial paper dealer or
provider of any surety, guarantee or credit or liquidity enhancement to such
SPC. This Section may not be amended without the prior written consent of each
Granting Lender, all or any part of whose Advance is being funded by an SPC at
the time of such amendment.
SECTION 8.9. Waiver of Jury Trial.
The Borrowers, the Administrative Agent and the Lenders irrevocably waive
all right to trial by jury in any action, proceeding or counterclaim arising out
of or relating to this Agreement, the Escrow Agreement or the Collateral Notes
or any instrument or document delivered hereunder or thereunder, except that the
foregoing shall not preclude any party hereto from submitting to a jury for
determination in any such action, proceeding or counterclaim any dispute
involving (i) the accuracy or completeness of any representation or warranty
made in Article IV hereof, (ii) the performance of any covenant or agreement
contained in Article V hereof, or (iii) questions of materiality, or the
reasonableness of, or good faith basis for, any action taken, or determination
made, by any other party hereto (other than in respect of any calculation of
principal, interest, fees, or increased costs payable by any Borrower
hereunder).
SECTION 8.10. Governing Law.
This Agreement shall be governed by, and construed in accordance with, the
laws of the State of New York.
SECTION 8.11. Consent to Jurisdiction; Waiver of Immunities.
(a) Each Borrower hereby irrevocably submits to the jurisdiction of any
New York state or Federal court 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, the Escrow Agreement or the Collateral Notes, and each Borrower
hereby irrevocably agrees that all claims in respect of such action or
proceeding may be heard and determined in any such court. Each Borrower hereby
irrevocably waives, to the fullest extent it may effectively do so, the defense
of an inconvenient forum to the maintenance of such action or proceeding. Each
Borrower agrees that a final, non-appealable 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.
(b) Nothing in this Section shall affect the right of any Lender to serve
legal process in any manner permitted by law or affect the right of any Lender
to bring any action or proceeding
58
against any Borrower or its property in the courts of any other jurisdictions.
SECTION 8.12. 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.
SECTION 8.13. Integration.
The Loan Documents set forth the entire understanding of the parties
hereto with respect to all matters contemplated hereby and thereby and supersede
all previous agreements and understandings among them concerning such matters.
No statements or agreements, oral or written, made prior to or at the signing
hereof, shall vary, waive or modify the written terms hereof. Nothing in the
Loan Documents, expressed or implied, is intended to confer upon any party other
than the parties hereto any rights, remedies, obligations or liabilities under
or by reason of the Loan Documents.
SECTION 8.14. Severability.
In the event any one or more of the provisions contained in this Agreement
should be held invalid, illegal, or unenforceable in any respect, the validity,
legality and enforceability of the remaining provisions contained herein shall
not in any way be affected or impaired thereby. The parties shall endeavor in
good-faith negotiations to replace the invalid, illegal, or unenforceable
provisions with valid provisions the economic effect of which comes as close as
possible to that of the invalid, illegal, or unenforceable provisions.
SECTION 8.15. Headings.
Article and Section headings and the Table of Contents used herein are for
convenience of reference only, are not part of this Agreement and are not to
affect the construction of, or to be taken into consideration in interpreting,
this Agreement.
59
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.
GPU, INC.
By /s/▇.▇. ▇▇▇▇▇▇
--------------------------------------
Name: ▇.▇. ▇▇▇▇▇▇
Title: Vice President
JERSEY CENTRAL POWER & LIGHT
COMPANY
By /s/▇.▇. ▇▇▇▇▇▇
--------------------------------------
Name: ▇.▇. ▇▇▇▇▇▇
Title: Vice President
METROPOLITAN EDISON COMPANY
By /s/▇.▇. ▇▇▇▇▇▇
---------------------------------------
Name: ▇.▇. ▇▇▇▇▇▇
Title: Vice President
PENNSYLVANIA ELECTRIC COMPANY
By /s/▇.▇. ▇▇▇▇▇▇
---------------------------------------
Name: ▇.▇. ▇▇▇▇▇▇
Title: Vice President
THE CHASE MANHATTAN BANK,
as Administrative Agent
By /s/▇▇▇▇▇▇ ▇. ▇▇▇▇▇ ▇▇
---------------------------------------
Name: ▇▇▇▇▇▇ ▇. ▇▇▇▇▇, M.D.
Title:
The Lenders
-----------
CITIBANK, N.A.
By /s/▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇, ▇▇.
---------------------------------------
Name: ▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇, ▇▇.
Title: Managing Director
THE CHASE MANHATTAN BANK
By /s/▇▇▇▇▇▇ ▇. ▇▇▇▇▇ ▇▇
---------------------------------------
Name: ▇▇▇▇▇▇ ▇. ▇▇▇▇▇, M.D.
Title:
ABN-AMRO BANK N.V.
By /s/▇▇▇▇ ▇. ▇▇▇▇▇
----------------------------------
Name: ▇▇▇▇▇▇ ▇. ▇▇▇▇▇
Title: Senior Vice President
& Managing Director
By /s/▇▇▇▇▇▇▇ ▇. ▇▇▇▇
----------------------------------
Name: ▇▇▇▇▇▇▇ ▇. ▇▇▇▇
Title: Senior Vice President
& Managing Director
THE BANK OF NOVA SCOTIA
By /s/▇▇▇▇▇ ▇. ▇▇▇▇▇
---------------------------------------
Name: ▇▇▇▇▇ ▇. ▇▇▇▇▇
Title: Managing Director
B.N.P. PARIBAS
By /s/▇▇▇▇▇▇▇ ▇. ▇▇ ▇▇▇▇▇
---------------------------------------
Name: ▇▇▇▇▇▇▇ ▇. ▇▇ ▇▇▇▇▇
Title: Director
By /s/▇▇▇▇ ▇. ▇▇▇▇▇▇
---------------------------------------
Name: ▇▇▇▇ ▇. ▇▇▇▇▇▇
Title: Director
CREDIT LYONNAIS,
NEW YORK BRANCH
By /s/Philippe Soustra
---------------------------------------
Name: Philippe Soustra
Title: Executive Vice President
▇▇▇▇▇▇ GUARANTY TRUST COMPANY OF NEW
YORK
By /s/▇▇▇▇ ▇. ▇▇▇▇▇▇▇ ▇▇.
---------------------------------------
Name: ▇▇▇▇ ▇. ▇▇▇▇▇▇▇ ▇▇.
Title: Vice President
BANK ONE, NA
By /s/▇▇▇▇▇▇▇ ▇. ▇▇▇▇▇
---------------------------------------
Name: ▇▇▇▇▇▇▇ ▇. ▇▇▇▇▇
Title: Director, Capital Markets
FIRST UNION NATIONAL BANK
By /s/▇▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇▇▇▇
---------------------------------------
Name: ▇▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇▇▇▇
Title: Vice President
[INTENTIONALLY OMITTED]
[INTENTIONALLY OMITTED]
THE ROYAL BANK OF SCOTLAND PLC
By /s/▇▇▇▇▇ ▇▇▇▇▇▇▇
---------------------------------------
Name: ▇▇▇▇▇ ▇▇▇▇▇▇▇
Title: Senior Vice President
[INTENTIONALLY OMITTED]
[INTENTIONALLY OMITTED]
UNION BANK OF CALIFORNIA, N.A.
By /s/▇▇▇▇▇▇ ▇. ▇▇▇▇▇
---------------------------------------
Name: ▇▇▇▇▇▇ ▇. ▇▇▇▇▇
Title: Vice President
[INTENTIONALLY OMITTED]
MELLON BANK, N.A.
By /s/▇▇▇▇ ▇. ▇▇▇▇▇▇
---------------------------------------
Name: ▇▇▇▇ ▇. ▇▇▇▇▇▇
Title: Vice President
THE BANK OF NEW YORK
By /s/▇▇▇▇ ▇. ▇▇▇▇
---------------------------------------
Name: ▇▇▇▇ ▇. ▇▇▇▇
Title: Vice President
PNC BANK, NATIONAL ASSOCIATION
By /s/▇▇▇▇▇ ▇. ▇▇▇▇
---------------------------------------
Name: ▇▇▇▇▇ ▇. ▇▇▇▇
Title: Vice President
[INTENTIONALLY OMITTED]
FLEET NATIONAL BANK
By /s/▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇▇▇
---------------------------------------
Name: ▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇▇▇
Title: Managing Director
SCHEDULE I
LIST OF LENDING OFFICES
Name of Lender Domestic Lending Office Eurodollar Lending
Office
The Chase Manhattan Bank
Citibank, N.A.
[OTHER LENDERS]
SCHEDULE II
SCHEDULE III
SENIOR DEBT DOCUMENTS
1. Jersey Central Power & Light Company
First Mortgage Bonds
--------------------
Indenture, dated as of March 1, 1946, to United States Trust Company of
New York, as Successor Trustee, as supplemented
Debentures
----------
Subordinated Debenture Indenture, dated as of May 1, 1995, to United
States Trust Company of New York, as Trustee
Senior Notes
------------
Senior Note Indenture, dated as of July 1, 1999, to United States Trust
Company of New York, as Trustee
2. Metropolitan Edison Company
First Mortgage Bonds
--------------------
Indenture, dated November 1, 1944, to United States Trust Company of
New York, as Successor Trustee, as supplemented
Debentures
----------
Subordinated Debenture Indenture, dated as of May 1, 1999, to United
States Trust Company of New York, as Trustee
Senior Notes
------------
Senior Note Indenture, dated as of July 1, 1999, to United States Trust
Company of New York, as Trustee
3. Pennsylvania Electric Company
First Mortgage Bonds
--------------------
Mortgage and Deed of Trust, dated as of January 1, 1942, to United States
Trust Company of New York, as Successor Trustee, as supplemented
Debentures
----------
Subordinated Debenture Indenture, dated as of June 1, 1999, to United
States Trust Company of New York, as Trustee
Senior Notes
------------
Senior Note Indenture, dated as of April 1, 1999, to United States
Trust Company of New York, as Trustee
Schedule IV
List of Bilateral Agreements
(A) Terminating Bilateral Agreements
--------------------------------
(1) Credit Agreement dated July 30, 1993, as amended, between GPU, Inc.
(formerly General Public Utilities Corporation), Metropolitan Edison Company,
Pennsylavania Electric Company, Jersey Central Power & Light Company and
Mellon Bank, N.A. ($20 million)
(2) Credit Agreement dated April 1, 1993, as amended, between GPU, Inc.
(formerly General Public Utilities Corporation), Metropolitan Edison Company,
Pennsylvania Electric Company, Jersey Central Power & Light Company and The
Chase Manhattan Bank, Assignee of Chemical Bank New Jersey, N.A. ($30 million)
(3) Credit Agreement dated September 25, 1993, as amended, between GPU,
Inc. (formerly General Public Utilities Corporation), Metropolitan Edison
Company, Pennsylvania Electric Company, Jersey Central Power & Light Company
and Citicorp USA, Inc. ($15 million)
(4) Credit Agreement dated October 1, 1993, as amended, between GPU, Inc.
(formerly General Public Utilities Corporation), Metropolitan Edison Company,
Pennsylvania Electric Company, Jersey Central Power & Light Company and First
Union National Bank, Successor in interest to First Fidelity Bank, N.A., New
Jersey, a National Banking Association ($26 million)
(5) Credit Agreement dated July 31, 1993, as amended, between GPU, Inc.
(formerly General Public Utilities Corporation), Metropolitan Edison Company,
Pennsylvania Electric Company, Jersey Central Power & Light Company and PNC
Bank, National Association ($25 million)
(6) Credit Agreement dated October 1, 1993, as amended, between GPU, Inc.
(formerly General Public Utilities Corporation), Metropolitan Edison Company,
Pennsylvania Electric Company, Jersey Central Power & Light Company and Fleet
National Bank (formerly Summit Bank) ($40 million)
(7) Credit Agreement dated July 1, 1993, as amended, between GPU, Inc. (formerly
General Public Utilities Corporation), Metropolitan Edison Company, Pennsylvania
Electric Company, Jersey Central Power & Light Company and Allfirst Bank
(successor to Bank of Pennsylvania, a Division of Dauphin Bank and Trust
Company) ($15 million)
(B) Excluded Bilateral Agreements
-----------------------------
(1) Credit Agreement dated as of July 30, 1993, as amended, between GPU,
Inc. (formerly General Public Utilities Corporation), Metropolitan Edison
Company, Pennsylvania Electric Company, Jersey Central Power & Light Company
and U.S. Bank (formerly known as United States National Bank in Johnstown)
($10 million)
(2) GPU, Inc., Jersey Central Power & Light Company, Metropolitan Edison
Company and Pennsylvania Electric Company - Master Unsecured Promissory
(Grid) Note dated February 28, 2001 ($2 million)
2
EXHIBIT A
FORM OF NOTICE OF CONVERSION
-------------- --, 20--
TheChase Manhattan Bank, as Administrative Agent for the Lenders parties to the
Credit Agreement referred to below
▇▇▇ ▇▇▇▇ ▇▇▇▇▇▇
▇▇▇ ▇▇▇▇, ▇▇▇ ▇▇▇▇ ▇▇▇▇▇
Attention: ▇▇▇▇▇▇ ▇. ▇▇▇▇▇
Ladies and Gentlemen:
The undersigned, [Name of Borrower], refers to the Amended and Restated
Credit Agreement, dated as of May --, 2001, (as amended, modified or
supplemented from time to time, the "Credit Agreement"), among GPU, Inc., Jersey
Central Power & Light Company, Metropolitan Edison Company and Pennsylvania
Electric Company, certain Lenders parties thereto and The Chase Manhattan Bank,
as Administrative Agent for said Lenders, and hereby gives you notice, pursuant
to Section 2.2 of the Credit Agreement, that the undersigned hereby requests a
Conversion under the Credit Agreement, and in that connection sets forth below
the information relating to such Conversion (the "Proposed Conversion") as
required by Section 2.2(a) of the Credit Agreement:
(i) The Business Day of the Proposed Conversion is --------,
----------.
(ii) The Type of Advances comprising the Proposed Conversion is
[Base Rate Advances] [Eurodollar Rate Advances].
(iii) The aggregate amount of the Proposed Conversion is
$-------------.
(iv) The Type of Advances to which such Advances are proposed to
be Converted is [Base Rate Advances] [Eurodollar Rate Advances].
(v) The Interest Period for each Advance made as part of the
Proposed Conversion is [ ---days] [------ month(s)].*
-------------------
* Delete for Base Rate Advances
The undersigned hereby acknowledges that the delivery of this Notice of
Conversion shall constitute a representation and warranty by the Borrower that,
on the date of the Proposed Conversion, the statements contained in Section
3.2(a) of the Credit Agreement are true.
Capitalized terms used herein and not otherwise defined have the meanings
assigned thereto in the Credit Agreement.
Very truly yours,
[NAME OF BORROWER]
By
------------------------------
Name:
Title:
A-2
EXHIBIT B
FORM OF NOTICE OF BORROWING
----------------- ---, 20---
TheChase Manhattan Bank,
as Administrative Agent for the
Lenders
parties to the Credit Agreement
referred
to below
▇▇▇ ▇▇▇▇ ▇▇▇▇▇▇
▇▇▇ ▇▇▇▇, ▇▇▇ ▇▇▇▇ ▇▇▇▇▇
Attention: ▇▇▇▇▇▇ ▇. ▇▇▇▇▇
Ladies and Gentlemen:
The undersigned, [Name of Borrower] (the "Company"), refers to the Amended
and Restated Credit Agreement, dated as of May --, 2001 (as amended, modified or
supplemented from time to time, the "Credit Agreement"), among GPU, Inc., Jersey
Central Power & Light Company, Metropolitan Edison Company and Pennsylvania
Electric Company, certain Lenders party thereto and The Chase Manhattan Bank, as
Administrative Agent for said Lenders. The Company hereby gives you irrevocable
notice pursuant to Section 2.1 of the Credit Agreement, and requests a Borrowing
under the Credit Agreement, and in that connection sets forth below the terms on
which such Borrowing (the "Proposed Borrowing") is made:
(A) Date of Proposed Borrowing ------------------
(which is a Business Day)
(B) Principal amount of Proposed ------------------
Borrowing*
(C) Type of Advances** ------------------
(D) Interest Period and the ------------------
last date thereof***
-------------------
* Not less than $10,000,000 or greater than the aggregate of the unused
Commitments and in integral multiples of $1,000,000.
** Eurodollar Rate or Base Rate.
*** Which shall end not later than the Termination Date.
(E) Name of Borrower ------------------------------
The undersigned hereby certifies that the following statements are true on
the date hereof, and will be true on the date of the Proposed Borrowing:
(i) the representations and warranties contained in Section 4.1****
[(excluding those contained in subsections (e) and (m) thereof)] are correct,
before and after giving effect to the Proposed Borrowing and to the application
of the proceeds therefrom, as though made on and as of such date; and
(ii) no event has occurred and is continuing, or would result from such
Proposed Borrowing or from the application of the proceeds therefrom, which
constitutes an Event of Default or an Unmatured Default.
Capitalized terms used herein and not otherwise defined have the meanings
assigned thereto in the Credit Agreement.
Very truly yours,
[NAME OF BORROWER]
By
------------------------
Name:
Title:
-------------------
**** Omit in Notices of Borrowing pursuant to Section 3.3.
B-2
EXHIBIT C
FORM OF ASSIGNMENT AND ACCEPTANCE
Dated -------------- ---, -------
Reference is hereby made to the Amended and Restated Credit Agreement,
dated as of May __, 2001 (as amended, modified or supplemented from time to
time, the "Credit Agreement"), among GPU, INC., a Pennsylvania corporation,
JERSEY CENTRAL POWER & LIGHT COMPANY, a New Jersey corporation, METROPOLITAN
EDISON COMPANY, a Pennsylvania corporation, and PENNSYLVANIA ELECTRIC COMPANY, a
Pennsylvania corporation (collectively, the "Borrowers"), the Lenders (as
defined in the Credit Agreement) and The Chase Manhattan Bank, as Administrative
Agent for the Lenders (the "Administrative Agent"). Unless otherwise defined
herein, terms defined in the Credit Agreement are used herein as therein
defined.
-------------------- (the "Assignor") and --------------------- (the
"Assignee") agree as follows:
1. The Assignor hereby sells and assigns to the Assignee, without
recourse, and the Assignee hereby purchases and assumes from the Assignor,
without recourse, the percentage interest specified on Schedule 1 hereto in and
to all of the Assignor's rights and obligations under the Credit Agreement as of
the date hereof (after giving effect to any other assignments thereof made prior
to the date hereof, whether or not such assignments have become effective, but
without giving effect to any other assignments thereof also made on the date
hereof), including, without limitation, such percentage interest in (i) the
Assignor's Commitment, which on the date hereof (after giving effect to any
other assignments thereof made prior to the date hereof, whether or not such
assignments have become effective, but without giving effect to any other
assignment thereof also made on the date hereof) is in the dollar amount
specified as the Assignor's Commitment on Schedule 1 hereto; and (ii) the
aggregate outstanding principal amount of Advances owing to the Assignor, which
on the date hereof (after giving effect to any other assignments thereof made
prior to the date hereof whether or not such assignments have become effective,
but without giving effect to any other assignment thereof also made on the date
hereof) is in the dollar amount specified as the aggregate outstanding principal
amount of Advances owing to the Assignor on Schedule 1 hereto.
2. The Assignor: (i) other than as provided in this Assignment and
Acceptance, makes no representation or warranty and assumes no responsibility
with respect to any statements, warranties or representations made in or in
connection with the
Credit Agreement or any other instrument or document furnished pursuant to the
Credit Agreement or the execution, legality, validity, enforceability,
genuineness, sufficiency or value of the Credit Agreement or any other
instrument or document furnished pursuant to the Credit Agreement; and (ii)
makes no representation or warranty and assumes no responsibility with respect
to the financial condition of any Borrower or the performance or observance by
any Borrower of any of its obligations under the Credit Agreement or any other
instrument or document furnished pursuant to the Credit Agreement.
3. The Assignee: (i) confirms that it has received a copy of the Loan
Documents, together with copies of the financial statements referred to in
Section 4.1 of the Credit Agreement and such other documents and information as
it has deemed appropriate to make its own credit analysis and decision to enter
into this Assignment and Acceptance; (ii) will, independently and without
reliance upon the Administrative Agent, the Assignor or any other Lender and
based on such documents and information as it shall deem appropriate at the
time, continue to make its own credit decisions in taking or not taking action
under the Credit Agreement; (iii) confirms that it is an Eligible Assignee; (iv)
appoints and authorizes the Administrative Agent to take such action as agent on
its behalf and to exercise such powers under the Credit Agreement as are
delegated to the Administrative Agent by the terms of the Loan Documents,
together with such powers as are reasonably incidental thereto; and (v) agrees
that it will perform in accordance with their terms all of the obligations which
by the terms of the Credit Agreement are required to be performed by it as a
Lender.
4. Following the execution of this Assignment and Acceptance by the
Assignor and the Assignee, it will be delivered to the Administrative Agent for
acceptance by the Administrative Agent. The effective date of this Assignment
and Acceptance shall be the date of acceptance thereof by the Administrative
Agent, unless otherwise specified on Schedule 1 hereto (the "Effective Date").
5. Upon consent of the Borrowers, as of the Effective Date, (i) the
Assignee shall be a party to the Credit Agreement and, to the extent that rights
and obligations thereunder have been assigned to it pursuant to this Assignment
and Acceptance, have the rights and obligations of a Lender under the Loan
documents; and (ii) the Assignor shall, to the extent that rights and
obligations under the Loan Documents have been assigned by it pursuant to this
Assignment and Acceptance, relinquish its rights and be released from its
obligations under the Loan Documents.
6. From and after the Effective Date, the Administrative Agent shall
make all payments under the Credit Agreement in respect of the interest
assigned hereby (including, without limitation, all payments of principal,
interest and fees with respect thereto) to the Assignee. The Assignor and
Assignee
C-2
shall make all appropriate adjustments in payments under the Credit Agreement
for periods prior to the Effective Date directly between themselves.
7. This Assignment and Acceptance may be executed in any number of
counterparts which, when taken together, shall be deemed to constitute one and
the same instrument.
8. This Assignment and Acceptance shall be governed by, and
construed in accordance with, the laws of the State of New York.
IN WITNESS WHEREOF, the parties hereto have caused this Assignment and
Acceptance to be executed by their respective officers thereunto duly
authorized, as of the date first above written, such execution being made on
Schedule 1 hereto.
C-3
Schedule 1
to
Assignment and Acceptance
Dated ---------- ---, ----
Section 1.
Percentage Interest: --------------------%
Assignor's Commitment: $--------------------
Aggregate Outstanding Principal
Amount of Advances
owing to the Assignor: $--------------------
Section 2.
Effective Date*: Dated: ------------- ---,----
[NAME OF ASSIGNOR] [NAME OF ASSIGNEE]
By ------------------------ By ------------------------
Name: Name:
Title: Title:
-------------------
* This date should be no earlier than the date of acceptance by the
Administrative Agent.
C-4
Accepted this ------- day
of ------------, ------
THE CHASE MANHATTAN BANK,
as Administrative Agent
By
--------------------------
Name:
Title:
The undersigned hereby consent to the above assignment:
GPU, INC.
By
--------------------------
Name:
Title:
JERSEY CENTRAL POWER & LIGHT
COMPANY
By
--------------------------
Name:
Title:
METROPOLITAN EDISON COMPANY
By
--------------------------
Name:
Title:
PENNSYLVANIA ELECTRIC COMPANY
By
--------------------------
Name:
Title:
C-5
EXHIBIT Q
FORM OF OPINION OF ▇▇▇▇▇▇ ▇▇▇▇ & PRIEST LLP
[Date of Effectiveness of
the Credit Agreement]
Toeach of the Lenders parties to the Credit Agreement referred to below and to
The Chase Manhattan Bank, as Administrative Agent
GPU, Inc.,
Jersey Central Power & Light Company,
Metropolitan Edison Company and
Pennsylvania Electric Company
Ladies and Gentlemen:
This opinion is furnished to you pursuant to Section 3.1(h) of the Amended
and Restated Credit Agreement, dated as of May __, 2001 (the "Credit
Agreement"), among GPU, Inc., Jersey Central Power & Light Company, Metropolitan
Edison Company and Pennsylvania Electric Company, the Lenders party thereto and
The Chase Manhattan Bank, as Administrative Agent. Terms not otherwise defined
herein have the meanings assigned to such terms in the Credit Agreement.
We have acted as counsel for the Borrowers in connection with the
preparation, execution and delivery of the Credit Agreement.
In that connection we have examined:
(1) the Credit Agreement;
(2) the Escrow Agreement;
(3) the Collateral Note Documents;
(4) the documents furnished by the Borrowers pursuant to Article III
of the Credit Agreement;
(5) the Articles or the Certificate of Incorporation of each Borrower
and all amendments thereto (such Borrower's "Charter");
(6) the by-laws of each Borrower and all amendments thereto (such
Borrower's "By-laws");
(7) certificates of the Secretary of the Commonwealth of Pennsylvania
attesting to the continued corporate subsistence and good standing
of each Borrower (other than JC) in that Commonwealth; and
(8) a certificate of the Secretary of the State of New Jersey attesting
to the continued corporate existence and good standing of JC in that
State.
In addition, we have examined the originals, or copies certified to our
satisfaction, of such other corporate records of the Borrowers, certificates of
public officials and of officers of the Borrowers, and agreements, instruments
and other documents, as we have deemed necessary as a basis for the opinions
expressed below. As to various questions of fact material to such opinions, we
have, when relevant facts were not independently established by us, relied upon
the representations of the Borrowers in the Credit Agreement, and upon
certificates of the Borrowers or their respective officers or of public
officials.
We have assumed (i) the due execution and delivery, pursuant to due
authorization, of the Loan Documents by the Lenders and the Administrative Agent
(as applicable), (ii) the authenticity of all such documents submitted to us as
originals, (iii) the genuineness of all signatures (other than those of the
Borrowers) and (iv) the conformity to the originals of all such documents
submitted to us as copies.
We are members of the Bar of the State of New York and do not purport to
be expert in the laws of any other jurisdiction, other than the Federal laws of
the United States of America. Our opinions expressed herein are limited to the
laws of the States of New York, New Jersey, the Commonwealth of Pennsylvania and
the Federal laws of the United States of America. We have relied, as to all
matters governed by the laws of the Commonwealth of Pennsylvania, on the
attached opinion of ▇▇▇▇, ▇▇▇▇▇▇▇, ▇▇▇▇▇ & ▇▇▇▇▇▇▇ LLP, upon which opinion we
believe you and we are justified in relying.
Based upon the foregoing and upon such investigation as we have deemed
necessary, we are of the opinion that:
1. JC is a corporation duly incorporated, validly existing and in
good standing under the laws of the State of New Jersey and each other
Borrower is a corporation duly incorporated and validly subsisting under
the laws of the Commonwealth of Pennsylvania.
2. The execution, delivery and performance by each Borrower of the
applicable Loan Documents are within such Borrower's corporate powers,
have been duly authorized by all necessary corporate action, do not
contravene (i) such Borrower's Charter or By-laws or (ii) any law, rule or
regulation applicable to such Borrower or (iii) to our
Q-2
knowledge any material contractual restriction binding on such Borrower,
and do not result in or require the creation of any Lien upon or with
respect to any of its properties, except as contemplated by and pursuant
to the terms of the Loan Documents. Each Loan Document has been duly
executed and delivered on behalf of such Borrower.
3. No authorization or approval or other action by, and no notice to
or filing with, any governmental authority or regulatory body is required
for the due execution, delivery and performance by each Borrower of the
Credit Agreement, the Collateral Notes or the Collateral FMBs to which
such Borrower is a party except for an appropriate order of the SEC under
the Utility Act which, on and as of the date of the initial Borrowing
hereunder and on and as of each date on which the representations and
warranties shall be deemed to be repeated, will be duly obtained, in full
force and effect and sufficient for its purpose.
4. The Loan Documents are the legal, valid and binding obligations
of each Borrower, enforceable against each Borrower in accordance with
their respective terms.
The opinions set forth in paragraph 4, above, are subject to the following
qualifications:
(a) The enforceability of each Borrower's obligations under the Loan
Documents is subject to the effect of any applicable bankruptcy,
insolvency, reorganization, moratorium or other similar laws affecting
creditors' rights generally.
(b) The enforceability of each Borrower's obligations under the Loan
Documents may be subject to general principles of equity (regardless of
whether such enforceability is considered in a proceeding in equity or at
law).
Except as provided in Section 4.1(m) of the Credit Agreement, to the best
of our knowledge after due inquiry, there are no actions, suits or arbitration
proceedings pending or threatened against or maintained by any Borrower before
any court, governmental agency or arbitrator (a) which would have a material
adverse effect on the financial condition or results of operations of such
Borrower or such Borrower and its Subsidiaries taken as a whole, or (b) that
call into question the validity, legally binding character or enforceability of
the Loan Documents.
This opinion is solely for your benefit and may not be relied upon by any
other person without our express consent, except that the firm of King &
Spalding is authorized to rely on this opinion in rendering their opinion, dated
the date hereof, to you.
Very truly yours,
Q-3
EXHIBIT R
FORM OF KING & SPALDING OPINION
[Date of Effectiveness
of the Credit Agreement]
Tothe Lenders parties to the Credit Agreement referred to below and to The
Chase Manhattan Bank, as Administrative Agent
GPU, Inc.,
Jersey Central Power & Light Company,
Metropolitan Edison Company and
Pennsylvania Electric Company
Ladies and Gentlemen:
We have acted as special New York counsel to The Chase Manhattan Bank,
individually and as the Administrative Agent , in connection with the
preparation, execution and delivery of the Amended and Restated Credit
Agreement, dated as of May --, 2001 (the "Credit Agreement"), among GPU, Inc.,
Jersey Central Power & Light Company, Metropolitan Edison Company and
Pennsylvania Electric Company and each of you. Unless otherwise indicated, terms
defined in the Credit Agreement are used herein as therein defined.
In that connection, we have examined the following documents:
(1) counterparts of the Credit Agreement, executed by the Borrowers,
the Administrative Agent and the Lenders;
(2) the other Loan Documents furnished by the Borrowers pursuant to
Section 3.1 of the Credit Agreement, including the opinion of ▇▇▇▇▇▇
▇▇▇▇ & Priest LLP, counsel for the Borrowers (the "▇▇▇▇▇▇ ▇▇▇▇
Opinion").
In our examination of the documents referred to above, we have assumed the
authenticity of all such documents submitted to us as originals, the genuineness
of all signatures, the due authority of the parties executing such documents and
the conformity to the originals of all such documents submitted to us as copies.
We have also assumed that each of the Lenders and the Administrative Agent has
duly executed and delivered, with all necessary power and authority (corporate
and otherwise), the Credit Agreement.
To the extent that our opinions expressed below involve conclusions as to
matters governed by law other than the law of the State of New York, we have
relied upon the ▇▇▇▇▇▇ ▇▇▇▇ Opinion and have assumed without independent
investigation the correctness of the matters set forth therein, our opinions
expressed below being subject to the assumptions, qualifications and limitations
set forth in the ▇▇▇▇▇▇ ▇▇▇▇ Opinion. As to matters of fact, we have relied
solely upon the documents we have examined.
Based upon the foregoing, and subject to the qualifications set forth
below, we are of the opinion that:
(i) The Loan Documents are the legal, valid and binding obligations
of such Borrower enforceable against such Borrower in accordance with
their respective terms.
(ii) While we have not independently considered the matters covered
by the ▇▇▇▇▇▇ ▇▇▇▇ Opinion to the extent necessary to enable us to express
the conclusions stated therein, the ▇▇▇▇▇▇ ▇▇▇▇ Opinion and the other
documents referred to in item (2) above are substantially responsive to
the corresponding requirements set forth in Section 3.1 of the Credit
Agreement pursuant to which the same have been delivered.
Our opinions are subject to the following qualifications:
(a) Our opinion in paragraph (i) above is subject to the effect of
any applicable bankruptcy, insolvency, reorganization, fraudulent
conveyance, moratorium or similar law affecting creditors' rights
generally.
(b) Our opinion in paragraph (i) above is subject to the effect of
general principles of equity, including (without limitation) concepts of
materiality, reasonableness, good faith and fair dealing (regardless of
whether considered in a proceeding in equity or at law).
(c) We note further that, in addition to the application of
equitable principles described above, courts have imposed an obligation on
contracting parties to act reasonably and in good faith in the exercise of
their contractual rights and remedies, and may also apply public policy
considerations in limiting the right of parties seeking to obtain
indemnification under circumstances where the conduct of such parties in
the circumstances in question is determined to have constituted
negligence.
(d) We express no opinion herein as to (i) Section 8.5 of the Credit
Agreement, (ii) the enforceability of provisions purporting to grant to a
party conclusive rights of determination, (iii) the availability of
specific performance or other equitable remedies, (iv) the
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enforceability of rights to indemnity under Federal or state securities
laws and (v) the enforceability of waivers by parties of their respective
rights and remedies under law.
(e) Our opinions expressed above are limited to the law of the State
of New York and the Federal law of the United States, and we do not
express any opinion herein concerning any other law. Without limiting the
generality of the foregoing, we express no opinion as to the effect of the
law of any jurisdiction other than the State of New York wherein any
Lender may be located or wherein enforcement of the Loan Documents may be
sought that limits the rates of interest legally chargeable or
collectible.
The foregoing opinion is solely for your benefit and may not be relied
upon by any other Person other than any Person that may become a Lender under
the Credit Agreement after the date hereof.
Very truly yours,
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