EXHIBIT 4F(6)
[Conformed Copy]
REVOLVING CREDIT AGREEMENT (FACILITY A)
by and among
ATLANTIC ENERGY, INC.,
THE LENDERS PARTY HERETO,
AND
THE BANK OF NEW YORK, AS AGENT
________________
$35,000,000
________________
Facilty A
Dated as of September 28, 1995
TABLE OF CONTENTS
1. DEFINITIONS AND PRINCIPLES OF CONSTRUCTION 1
1.1. Definitions 1
1.2. Principles of Construction 15
2. AMOUNT AND TERMS OF LOANS 16
2.1. Revolving Credit Loans 16
2.2. Revolving Credit Notes 16
2.3. Procedure for Borrowing Revolving Credit Loans 17
2.4. Competitive Bid Loans; Procedure 18
2.5. Voluntary Reduction or Termination of Aggregate
Commitments 21
2.6. Prepayments of the Loans 21
2.7. Conversions and Continuations 22
2.8. Interest Rate and Payment Dates 23
2.9. Substituted Interest Rate 24
2.10. Taxes 25
2.11. Illegality 27
2.12. Increased Costs 27
2.13. Indemnification for Loss 28
2.14. Survival of Certain Obligations 29
2.15. Use of Proceeds 29
2.16. Capital Adequacy 29
2.17. Change of Lending Office; Right to Substitute
Lender 29
2.18. Extension of Maturity Date 30
2.19. Change in Control 32
2.20. Agent's Records 33
3. FEES; PAYMENTS 33
3.1. Facility Fee 33
3.2. Agent's Fees 33
3.3. Pro Rata Treatment and Application of Principal
Payments 33
4. REPRESENTATIONS AND WARRANTIES 34
4.1. Subsidiaries 34
4.2. Existence and Power 34
4.3. Authority; Enforceability 34
4.4. Required Consents 34
4.5. No Conflicting Agreements, Compliance with
Laws; Taxes 35
4.6. Franchises, Licenses, Etc. 35
Facility A
4.7. Investment Company Act 35
4.8. Public Utility Status 35
4.9. Federal Reserve Regulations; Use of Loan
Proceeds 35
4.10. Litigation 36
4.11. Financial Statements 36
4.12. Plans 36
4.13. Ownership of Property; Liens 36
4.14. Security Interests 37
4.15. Environmental Matters 37
4.16. Certain Business Activities 37
5. CONDITIONS TO FIRST LOANS 37
5.1. Evidence of Action 37
5.2. This Agreement; Notes 38
5.3. Certificate as to Approvals and Liens 38
5.4. Pledge Agreement 38
5.5. Facility B Loan Documents 38
5.6. Other Credit Facilities 38
5.7. ACE Preferred Stock 39
5.8. Opinions of Counsel 39
5.9. Opinion of Special Counsel 39
5.10. Fees 39
6. CONDITIONS OF LENDING - ALL LOANS 39
6.1. Compliance 39
6.2. Borrowing Request; Competitive Bid Request 40
7. AFFIRMATIVE COVENANTS 40
7.1. Financial Statements 40
7.2. Certificates; Other Information 40
7.3. Legal Existence 41
7.4. Taxes 41
7.5. Insurance 42
7.6. Condition of Property 42
7.7. Observance of Legal Requirements 42
7.8. Inspection of Property; Books and Records;
Discussions 42
7.9. Licenses, Franchises, Intellectual Property,
Etc. 42
7.10. Indebtedness Capitalization Ratio 42
7.11. Ratio of Indebtedness to Annualized ACE
Dividends 43
Facility A
8. NEGATIVE COVENANTS 43
8.1. Indebtedness 43
8.2. Liens 43
8.3. Merger; Consolidation 44
8.4. Restricted Payments 44
8.5. Investments, Acquisitions, Loans, Etc. 45
8.6. Amendments, Etc. of Intercompany Notes 46
8.7. Designation of Operating Subsidiaries 46
8.8. Certain Business Activities 46
9. DEFAULT 46
9.1. Events of Default 46
10. THE AGENT 49
10.1. Appointment 49
10.2. Delegation of Duties 49
10.3. Exculpatory Provisions 50
10.4. Reliance by Agent 50
10.5. Notice of Default 50
10.6. Non-Reliance on Agent and Other Lenders 51
10.7. Indemnification 51
10.8. Agent in Its Individual Capacity 52
10.9. Successor Agent 52
11. OTHER PROVISIONS 53
11.1. Amendments and Waivers 53
11.2. Notices 53
11.3. No Waiver; Cumulative Remedies 54
11.4. Survival of Representations and Warranties 55
11.5. Payment of Expenses and Taxes 55
11.6. Lending Offices 55
11.7. Assignments and Participations 56
11.8. Counterparts 57
11.9. Adjustments; Set-off 58
11.10. Indemnity 59
11.11. Governing Law 59
11.12. Headings Descriptive 59
11.13. Severability 59
11.14. Integration 60
11.15. Consent to Jurisdiction 60
11.16. Service of Process 60
11.17. No Limitation on Service or Suit 60
11.18. WAIVER OF TRIAL BY JURY 60
EXHIBITS
Exhibit A List of Commitments
Exhibit B-1 Form of Revolving Credit Note
Exhibit B-2 Form of Competitive Bid Note
Exhibit C Form of Borrowing Request
Exhibit D Form of Competitive Bid Request
Exhibit E Form of Invitation to Bid
Exhibit F Form of Competitive Bid
Exhibit G Form of Competitive Bid Accept/Reject Letter
Exhibit H Form of Competitive Bid Loan Confirmation
Exhibit I Form of Notice of Conversion/Continuation
Exhibit J [Reserved]
Exhibit K Form of Compliance Certificate
Exhibit L Form of Pledge Agreement
Exhibit M Form of Intercompany Note
Exhibit N Form of Opinion of Counsel to the Borrower
Exhibit O Form of Opinion of Special Counsel
Exhibit P Form of Assignment and Acceptance Agreement
Exhibit Q Form of Guaranty
SCHEDULES
Schedule 1.1 List of Lending Offices
Schedule 4.1 List of Subsidiaries
Schedule 4.1 List of Existing Pension Plans
Schedule 8.1 List of Existing Indebtedness
Schedule 8.2 List of Existing Liens
Schedule 8.5 List of Existing Investments
REVOLVING CREDIT AGREEMENT (FACILITY A), dated as of
September 28, 1995, by and among ATLANTIC ENERGY, INC., a New
Jersey corporation (the "Borrower"), the lenders party hereto
(together with their respective assigns, the "Lenders", each a
"Lender") and THE BANK OF NEW YORK, as agent for the Lenders (in
such capacity, the "Agent").
1. DEFINITIONS AND PRINCIPLES OF CONSTRUCTION
1.1. Definitions
As used in this Agreement, terms defined in the preamble
have the meanings therein indicated, and the following terms have
the following meanings:
"ABR Advances": the Revolving Credit Loans (or any
portions thereof) at such time as they (or such portions) are
made and/or being maintained at a rate of interest based upon the
Alternate Base Rate.
"ACE": Atlantic City Electric Company, a New Jersey
corporation and a wholly owned Subsidiary of the Borrower.
"ACE Preferred Stock": the Cumulative Preferred Stock,
$100 par value, the No Par Preferred Stock and the Preference
Stock, No Par Value of ACE outstanding from time to time.
"Accountants": Deloitte & Touche LLP (or any successor
thereto), or such other firm of certified public accountants of
recognized national standing selected by the Borrower.
"Acquisition": the acquisition of a business by the
Borrower or any of its Subsidiaries through either a merger with
another Person or the purchase of all or substantially all of the
capital Stock of another Person or all or substantially all of
the assets of another Person or of a division of another Person.
"Accumulated Funding Deficiency": as defined in Section
302 of ERISA.
"Advance": with respect to a Revolving Credit Loan, an ABR
Advance or a Eurodollar Advance, as the case may be.
"Affected Advance": as defined in Section 2.9.
"Affiliate": as to any Person, any other Person which,
directly or indirectly, is in control of, is controlled by, or is
under common control with, such Person. For purposes of this
definition, control of a Person shall mean the power, direct or
indirect, (i) to vote 5% or more of the securities or other
interests having ordinary voting power for the election of
directors or other managing Persons thereof or (ii) to direct or
cause the direction of the management and policies of such
Person, whether by contract or otherwise.
"Aggregate Commitments": on any date, the sum of all
Commitments on such date.
"Aggregate Credit Exposure": as of any date of
determination, the sum of the aggregate outstanding principal
balance of all Revolving Credit Loans and Competitive Bid Loans
of all Lenders.
"Aggregate Facility B Commitments": the aggregate of the
Facility B Commitments of the Facility B Lenders.
"Agreement": this Revolving Credit Agreement (Facility A),
as the same may be amended, supplemented or otherwise modified
from time to time.
"Alternate Base Rate": on any date, a rate of interest per
annum equal to the higher of (i) the Federal Funds Rate in effect
on such date plus 1/2 of 1% or (ii) the BNY Rate in effect on
such date.
"Annualized ACE Dividends": at any date of determination,
an amount equal to (i) the amount of dividends paid to the
Borrower by ACE during the fiscal quarter ending on such date of
determination or, if such date of determination is not a fiscal
quarter ending date, the immediately preceding fiscal quarter,
multiplied by (ii) four.
"Applicable Fee Percentage": with respect to the amount of
the Aggregate Commitments, at all times during which the
applicable Pricing Level set forth below is in effect, the
percentage set forth below next to such Pricing Level, subject to
the provisos set forth below:
Applicable
Pricing Level Fee Percentage
Pricing Level I 0.125%
Pricing Level II 0.150%
Pricing Level III 0.175%
Pricing Level IV 0.250%
provided that (i) changes in the Applicable Fee Percentage
resulting from a change in the Pricing Level shall become
effective on the effective date of any change in the Senior Debt
Rating by Moody's or S&P and (ii) in the event of a split in
ratings resulting in the Senior Debt Rating by S&P and Moody's
falling within different Pricing Levels, the Applicable Fee
Percentage shall be the lower percentage.
"Applicable Lending Office": in respect of any Lender, (i)
in the case of such Lender's ABR Advances and Competitive Bid
Loans, its Domestic Lending Office and (ii) in the case of such
Lender's Eurodollar Advances, its Eurodollar Lending Office.
"Applicable Margin": with respect to the unpaid principal
amount of Eurodollar Advances, at all times during which the
applicable Pricing Level set forth below is in effect, the
percentage set forth below next to such Pricing Level, subject to
the provisos set forth below:
Pricing Level Applicable Margin
Pricing Level I 0.300%
Pricing Level II 0.325%
Pricing Level III 0.425%
Pricing Level IV 0.500%
provided that (i) changes in the Applicable Margin resulting from
a change in the Pricing Level shall become effective on the
effective date of any change in the Senior Debt Rating by Moody's
or S&P and (ii) in the event of a split in ratings resulting in
the Senior Debt Rating by each of S&P and Moody's falling within
different Pricing Levels, the Applicable Margin shall be the
lower percentage.
"Approved Financial Institutions": collectively, (i) each
Lender, (ii) those major United States and foreign commercial
banks with which the Borrower or its affiliates have formal line-
of-credit relationships as of the Effective Date, (iii) domestic
branches of major Canadian banks and (iv) such other banks as
appropriate officers of the Borrower may deem appropriate and
with respect to which the Agent shall have received advance
written notice.
"Assignment and Acceptance Agreement": an assignment and
acceptance agreement executed by an assignor and an assignee
pursuant to which the assignor assigns to the assignee all or any
portion of such assignor's (i) Notes, (ii) Commitment, (iii)
Facility B Notes and (iv) Facility B Commitment, substantially in
the form of Exhibit P.
"Assignment Fee": as defined in Section 11.7(b).
"Atlantic Thermal": Atlantic Thermal Systems, Inc., a New
Jersey corporation and a wholly owned Subsidiary of the Borrower.
"ATE": ATE Investment, Inc., a New Jersey corporation and
a wholly owned Subsidiary of the Borrower.
"ATE Credit Agreement": the Revolving Credit and Term Loan
Agreement, dated as of May 24, 1988, as amended, between ATE and
BNY.
"Authorized Signatory": as to (i) any Person which is a
corporation, the chairman of the board, the president, any vice
president, the chief financial officer or any other duly
authorized officer (acceptable to the Agent) of such Person and
(ii) any Person which is not a corporation, the general partner
or other managing Person thereof.
"Benefited Lender": as defined in Section 11.9.
"Bid Rate": as defined in Section 2.4(b).
"BNY": The Bank of New York.
"BNY Rate": a rate of interest per annum equal to the rate
of interest publicly announced in New York City by BNY from time
to time as its prime commercial lending rate, such rate to be
adjusted automatically (without notice) on the effective date of
any change in such publicly announced rate.
"Borrowing Date": any Business Day on which (i) the
Lenders make Revolving Credit Loans in accordance with a
Borrowing Request or (ii) one or more Lenders make Competitive
Bid Loans pursuant to Competitive Bids which have been accepted
by the Borrower.
"Borrowing Request": a request for Revolving Credit Loans
in the form of Exhibit C.
"Business Day": any day other than a Saturday, a Sunday or
a day on which commercial banks located in New York City are
authorized or required by law or other governmental action to
close.
"Capital Lease Obligations": with respect to any Person,
obligations of such Person with respect to leases which, in
accordance with GAAP, are required to be capitalized on the
financial statements of such Person.
"Change in Control": either (i) any "person" or "group"
(within the meaning of Sections 13(d) and 14(d)(2) of the
Exchange Act) becoming the "beneficial owner" (as defined in Rule
13d-3 under the Exchange Act) of shares of capital Stock of the
Borrower entitled to exercise more than 50% of the total voting
power of all outstanding shares of capital Stock, unless such
beneficial ownership is approved by the board of directors of the
Borrower prior to the acquisition; or (ii) a majority of the
board of directors of the Borrower are not Continuing Directors.
"Code": the Internal Revenue Code of 1986, as the same may
be amended from time to time, or any successor thereto, and the
rules and regulations issued thereunder, as from time to time in
effect.
"Collateral": collectively, the collateral under and as
defined in the Pledge Agreement.
"Commitment": in respect of any Lender, such Lender's
undertaking during the Commitment Period to make Revolving Credit
Loans, subject to the terms and conditions hereof, in an
aggregate outstanding principal amount not exceeding the amount
set forth next to the name of such Lender in Exhibit A under the
heading "Commitment", as the same may be reduced pursuant to
Section 2.5.
"Commitment Period": the period from the Effective Date
until the day before the Maturity Date.
"Commitment Percentage": as to any Lender, the percentage
set forth opposite the name of such Lender in Exhibit A under the
heading "Commitment Percentage".
"Competitive Bid": an offer by a Lender, in the form of
Exhibit F, to make a Competitive Bid Loan.
"Competitive Bid Accept/Reject Letter": a notification
given by the Borrower pursuant to Section 2.4 in the form of
Exhibit G.
"Competitive Bid Loan": each Loan from a Lender to the
Borrower pursuant to Section 2.4.
"Competitive Bid Loan Confirmation": a confirmation by the
Agent to a Lender of the acceptance by the Borrower of any
Competitive Bid (or Portion thereof) made by such Lender,
substantially in the form of Exhibit H.
"Competitive Bid Note" and "Competitive Bid Notes": as
defined in Section 2.4(g).
"Competitive Bid Request": a request by the Borrower, in
the form of Exhibit D, for Competitive Bids.
"Competitive Interest Period": with respect to any
Competitive Bid Loan, the period commencing on the date of such
Competitive Bid Loan and ending on the date requested in the
Competitive Bid Request with respect to such Competitive Bid
Loan, which date shall not be earlier than 7 days after the date
of such Competitive Bid Loan or later than 180 days after the
date of such Competitive Bid Loan; provided, however, that if any
Competitive Interest Period would end on a day other than a
Business Day, such Interest Period shall be extended to the next
succeeding Business Day, unless such next succeeding Business Day
would be a date on or after the Maturity Date, in which case such
Competitive Interest Period shall end on the next preceding
Business Day, and provided further that no Competitive Interest
Period shall end after the Maturity Date. Interest shall accrue
from and including the first day of a Competitive Interest Period
to but excluding the last day of such Competitive Interest
Period.
"Compliance Certificate": a certificate in the form of
Exhibit K.
"Consenting Lenders": as defined in Section 2.18(b).
"Consolidated": the Borrower and its Subsidiaries which
are consolidated for financial reporting purposes.
"Consolidated Total Indebtedness": at any date of
determination, total Indebtedness of the Borrower and its
Subsidiaries determined on a Consolidated basis in accordance
with GAAP.
"Consolidated Total Capitalization": at any date of
determination with respect to the Borrower and its Subsidiaries
on a Consolidated basis in accordance with GAAP, the sum of (i)
the amount classified as common shareholders equity for purposes
of balance sheet presentation in accordance with GAAP, plus (ii)
the amount classified as preferred stock for purposes of balance
sheet presentation in accordance with GAAP, plus (iii) all
Indebtedness (net of unamortized premium and discount), less (iv)
unamortized capital Stock expense.
"Contingent Obligation": as to any Person (the "secondary
obligor"), any obligation of such secondary obligor (i)
guaranteeing or in effect guaranteeing any return on any
investment made by another Person, or (ii) guaranteeing or in
effect guaranteeing any Indebtedness, lease, dividend or other
monetary obligation ("primary obligation") of any other Person
(the "primary obligor") in any manner, whether directly or
indirectly, including, without limitation, any obligation of such
secondary obligor, whether contingent, (A) to purchase any such
primary obligation or any Property constituting direct or
indirect security therefor, (B) to advance or supply funds (x)
for the purchase or payment of any such primary obligation or (y)
to maintain working capital or equity capital of the primary
obligor or otherwise to maintain the net worth or solvency of the
primary obligor, (C) to purchase Property, securities or services
primarily for the purpose of assuring the beneficiary of any such
primary obligation of the ability of the primary obligor to make
payment of such primary obligation, (D) otherwise to assure or
hold harmless the beneficiary of such primary obligation against
loss in respect thereof, and (E) in respect of the liabilities of
any partnership in which such secondary obligor is a general
partner, except to the extent that such liabilities of such
partnership are nonrecourse to such secondary obligor and its
separate Property, provided, however, that the term "Contingent
Obligation" shall not include the indorsement of instruments for
deposit or collection in the ordinary course of business. The
amount of any Contingent Obligation of a Person shall be deemed
to be an amount equal to the stated or determinable amount of the
primary obligation in respect of which such Contingent Obligation
is made or, if not stated or determinable, the maximum reasonably
anticipated liability in respect thereof as determined by such
Person in good faith.
"Continuing Director": at any date of determination, a
member of the board of directors of the Borrower who (i) was a
member of such board for the prior of 24 months prior to such
date or (ii) was nominated for election or elected to such board
with the affirmative vote of at least two-thirds of the
Continuing Directors.
"Control Person": as defined in Section 2.16.
"Conversion/Continuation Date": the date on which (i) a
Eurodollar Advance is converted to an ABR Advance, (ii) the date
on which an ABR Advance is converted to a Eurodollar Advance or
(iii) the date on which a Eurodollar Advance is continued as a
new Eurodollar Advance.
"Credit Exposure": with respect to any Lender as of any
date, the sum as of such date of the outstanding principal
balance of such Lender's Revolving Credit Loans.
"Default": any event or condition which constitutes an
Event of Default or which, with the giving of notice, the lapse
of time, or any other condition, would, unless cured or waived,
become an Event of Default.
"District Heating and Cooling Project": a proposed
centralized steam and chilled water production facility located
in Atlantic City, New Jersey.
"Dollars" and "$": lawful currency of the United States of
America.
"Domestic Lending Office": in respect of any Lender,
initially, the office or offices of such Lender designated as
such on Schedule 1.1; thereafter, such other office of such
Lender through which it shall be making or maintaining ABR
Advances or Competitive Bid Loans, as reported by such Lender to
the Agent and the Borrower, provided that any Lender may so
report different Domestic Lending Offices for all of its ABR
Advances and all of its Competitive Bid Loans, whereupon
references to the Domestic Lending Office of such Lender shall
mean either or both of such offices, as applicable.
"Effective Date": September 28, 1995.
"Employee Benefit Plan": an employee benefit plan within
the meaning of Section 3(3) of ERISA maintained, sponsored or
contributed to by the Borrower, any of its Subsidiaries or any
ERISA Affiliate.
"Environmental Laws": any and all federal, state and local
laws relating to the environment, the use, storage, transporting,
manufacturing, handling, discharge, disposal or recycling of
hazardous substances, materials or pollutants or industrial
hygiene, and including, without limitation, (i) the Comprehensive
Environmental Response, Compensation and Liability Act, as
amended, 42 USCA 9601 et seq.; (ii) the Resource Conservation
and Recovery Act of 1976, as amended, 42 USCA 6901 et seq.;
(iii) the Toxic Substance Control Act, as amended, 15 USCA 2601
et seq.; (iv) the Water Pollution Control Act, as amended, 33
USCA 1251 et seq.; (v) the Clean Air Act, as amended, 42 USCA
7401 et seq.; (vi) the Hazardous Material Transportation
Authorization Act of 1994, as amended, 49 USCA 5101 et seq. and
(viii) all rules, regulations, judgments, decrees, injunctions
and restrictions thereunder and any analogous state law.
"ERISA": the Employee Retirement Income Security Act of
1974, as amended from time to time, and the rules and regulations
issued thereunder, as from time to time in effect.
"ERISA Affiliate": when used with respect to an Employee
Benefit Plan, ERISA, the PBGC or a provision of the Code
pertaining to employee benefit plans, any Person that is a member
of any group of organizations within the meaning of Sections
414(b) or (c) of the Code (or, solely for purposes of potential
liability under Section 302(c)(11) of ERISA and Section
412(c)(11) of the Code and the lien created under Section 302(f)
of ERISA and Section 412(n) of the Code, Sections 414(m) or (o)
of the Code) of which the Borrower or any of its Subsidiaries is
a member.
"Eurodollar Advances": collectively, the Revolving Credit
Loans (or any portions thereof) at such time as they (or such
portions) are made and/or being maintained at a rate of interest
based upon the Eurodollar Rate.
"Eurodollar Interest Period": with respect to any
Eurodollar Advance requested by the Borrower, the period
commencing on, as the case may be, the Borrowing Date or
Conversion/Continuation Date with respect to such Eurodollar
Advance and ending one, two, three or six months thereafter, as
selected by the Borrower in its irrevocable Borrowing Request or
its irrevocable Notice of Conversion/Continuation, provided,
however, that (i) if any Eurodollar Interest Period would
otherwise end on a day which is not a Business Day, such
Eurodollar Interest Period shall be extended to the next
succeeding Business Day unless the result of such extension would
be to carry such Interest Period into another calendar month, in
which event such Eurodollar Interest Period shall end on the
immediately preceding Business Day, (ii) any Eurodollar Interest
Period that begins on the last Business Day of a calendar month
(or on a day for which there is no numerically corresponding day
in the calendar month at the end of such Eurodollar Interest
Period) shall end on the last Business Day of a calendar month
and (iii) the Borrower shall select Interest Periods so as not to
have more than three different Eurodollar Interest Periods
outstanding at any one time for all Eurodollar Advances.
"Eurodollar Lending Office": in respect of any Lender,
initially, the office, branch or affiliate of such Lender
designated as such on Schedule 1.1 (or, if no such office branch
or affiliate is specified, its Domestic Lending Office);
thereafter, such other office, branch or affiliate of such Lender
through which it shall be making or maintaining Eurodollar
Advances, as reported by such Lender to the Agent and the
Borrower.
"Eurodollar Rate": with respect to the Eurodollar Interest
Period applicable to any Eurodollar Advance, a rate of interest
per annum, as determined by the Agent, obtained by dividing (and
then rounding to the nearest 1/16 of 1% or, if there is no
nearest 1/16 of 1%, then to the next higher 1/16 of 1%):
(a) the rate, as reported by BNY to the Agent,
quoted by BNY to leading banks in the interbank eurodollar market
as the rate at which BNY is offering Dollar deposits in an amount
equal approximately to the Eurodollar Advance of BNY to which
such Interest Period shall apply for a period equal to such
Interest Period, as quoted at approximately 11:00 a.m. two
Business Days prior to the first day of such Interest Period, by
(b) a number equal to 1.00 minus the aggregate of
the then stated maximum rates during such Interest Period of all
reserve requirements (including, without limitation, marginal,
emergency, supplemental and special reserves), expressed as a
decimal, established by the Board of Governors of the Federal
Reserve System and any other banking authority to which BNY and
other major United States money center banks are subject, in
respect of eurocurrency funding (currently referred to as
"Eurocurrency liabilities" in Regulation D of the Board of
Governors of the Federal Reserve System) or in respect of any
other category of liabilities including deposits by reference to
which the interest rate on Eurodollar Advances is determined or
any category of extensions of credit or other assets which
includes loans by non-domestic offices of any Lender to United
States Residents. Such reserve requirements shall include,
without limitation, those imposed under such Regulation D.
Eurodollar Advances shall be deemed to constitute Eurocurrency
liabilities and as such shall be deemed to be subject to such
reserve requirements without benefit of credits for proration,
exceptions or offsets which may be available from time to time to
any Lender under such Regulation D. The Eurodollar Rate shall be
adjusted automatically on and as of the effective date of any
change in any such reserve requirement.
"Event of Default": any of the events specified in Section
9.1, provided that any requirement for the giving of notice, the
lapse of time, or any other condition has been satisfied.
"Exchange Act": the Securities and Exchange Act of 1934,
as amended.
"Existing Pension Plans": as defined in Section 4.12.
"Extension Consent Period": the period which is less than
35 days, but equal to or greater than 30 days, prior to the then
current Maturity Date (provided, however, that if such 30th prior
day falls on a day that is not a Business Day, such date shall be
extended to the next following Business Day).
"Extension Consent Required Lenders": Lenders having at
least 66 2/3% of the Aggregate Commitments (without giving effect
to any Loans outstanding).
"Extension Request": as defined in Section 2.18.
"Facility B": the $40,000,000 senior three-year revolving
credit facility established pursuant to the Facility B Loan
Documents.
"Facility B Agent": The Bank of New York, in its capacity
as agent for the Facility B Lenders under the Facility B Loan
Documents.
"Facility B Commitment": in respect of any Facility B
Lender, such Facility B Lender's undertaking during the
Commitment Period (as defined in the Facility B Credit Agreement)
to make Facility B Loans, in an amount not in excess, and subject
to the terms and conditions, of the Facility B Credit Agreement.
"Facility B Commitment Percentage": as to any Facility B
Lender, such Facility B Lender's Commitment Percentage as defined
in the Facility B Credit Agreement.
"Facility B Credit Agreement": the Revolving Credit
Agreement (Facility B), dated as of the date hereof, among the
Borrower, the Facility B Agent and the Facility B Lenders, as the
same may be amended, supplemented or otherwise modified from time
to time.
"Facility B Lenders": the Lenders party to the Facility B
Loan Documents.
"Facility B Loan Documents": collectively, the Facility B
Credit Agreement, the Facility B Notes and the Pledge Agreement.
"Facility B Maturity Date": the maturity date under the
Facility B Credit Agreement, as from time to time extended
pursuant thereto.
"Facility B Notes": collectively, (i) the Revolving Credit
Notes (Facility B) and (ii) the Competitive Bid Notes (Facility
B) made by the Borrower pursuant to the Facility B Credit
Agreement, as indorsed or modified from time to time.
"Facility Fee": as defined in Section 3.1.
"Federal Funds Rate": for any day, a rate per annum
(expressed as a decimal, rounded upwards, if necessary, to the
next higher 1/100 of 1%), equal to the weighted average of the
rates on overnight federal funds transactions with members of the
Federal Reserve System arranged by federal funds brokers on such
day, as published by the Federal Reserve Bank of New York on the
Business Day next succeeding such day, provided that (i) if the
day for which such rate is to be determined is not a Business
Day, the Federal Funds Rate for such day shall be such rate on
such transactions on the next preceding Business Day as so
published on the next succeeding Business Day, and (ii) if such
rate is not so published for any day, the Federal Funds Rate for
such day shall be the average of the quotations for such day on
such transactions received by BNY as determined by BNY and
reported to the Agent.
"Financial Statements": as defined in Section 4.11.
"GAAP": generally accepted accounting principles set forth
in the opinions and pronouncements of the Accounting Principles
Board and the American Institute of Certified Public Accountants
and in the statements and pronouncements of the Financial
Accounting Standards Board or in such other statement by such
other entity as may be approved by a significant segment of the
accounting profession, which are applicable to the circumstances
as of the date of determination, consistently applied. If at any
time any change in GAAP would affect the computation of any
financial ratio or requirement set forth in this Agreement, the
Agent, the Lenders and the Borrower shall negotiate in good faith
to amend such ratio or requirement to reflect such change in GAAP
(subject to the approval of the Required Lenders), provided that,
until so amended, (i) such ratio or requirement shall continue to
be computed in accordance with GAAP prior to such change therein
and (ii) the Borrower shall provide to the Agent and the Lenders
financial statements and other documents required under this
Agreement or as reasonably requested hereunder setting forth a
reconciliation between calculations of such ratio or requirement
made before and after giving effect to such change in GAAP.
"Governmental Authority": any nation or government, any
state or other political subdivision thereof, any entity
exercising executive, legislative, judicial, regulatory or
administrative functions of or pertaining to government and any
court or arbitrator.
"Highest Lawful Rate": as to any Lender, the maximum rate
of interest, if any, that at any time or from time to time may be
contracted for, taken, charged or received by such Lender on the
Notes, or which may be owing to such Lender pursuant the Loan
Documents under the laws applicable to such Lender and this
transaction.
"Indebtedness": as to any Person, at a particular time,
all items which constitute, without duplication, (i) indebtedness
for borrowed money or the deferred purchase price of Property
(other than trade payables incurred in the ordinary course of
business), (ii) indebtedness evidenced by notes, bonds,
debentures or similar instruments, (iii) obligations with respect
to any conditional sale or title retention agreement, (iv)
indebtedness arising under acceptance facilities and the amount
available to be drawn under all letters of credit (other than
trade letters of credit) issued for the account of such Person
and, without duplication, all drafts drawn thereunder to the
extent such Person shall not have reimbursed the issuer in
respect of the issuer's payment of such drafts, (v) all
liabilities secured by any Lien on any Property owned by such
Person even though such Person has not assumed or otherwise
become liable for the payment thereof (other than (A) carriers',
warehousemen's, mechanics', repairmen's or other like non-
consensual statutory Liens arising in the ordinary course of
business and (B) liabilities of Subsidiaries (other than ACE and
Operating Subsidiaries) for which recourse may be had by the
creditor only to the Property secured by the Lien), (vi) Capital
Lease Obligations and (vii) Contingent Obligations.
"Indebtedness Capitalization Ratio": the ratio of (i)
Consolidated Total Indebtedness to (ii) Consolidated Total
Capitalization.
"Indemnified Person": as defined in Section 11.10.
"Intercompany Loans": loans from time to time made by the
Borrower to an Operating Subsidiary.
"Intercompany Note": a promissory note made by an
Operating Subsidiary to the Borrower evidencing the Intercompany
Loans made by the Borrower to such Operating Subsidiary,
substantially in the form of Exhibit M, as the same may be
amended, modified or supplemented.
"Interest Payment Date": (i) as to any ABR Advance, the
last day of each March, June, September and December commencing
on the first of such days to occur after such ABR Advance is made
or any Eurodollar Advance is converted to an ABR Advance, (ii) as
to any Eurodollar Advance in respect of which the Borrower has
selected a Eurodollar Interest Period of one, two or three
months, the last day of such Interest Period, (iii) as to any
Eurodollar Advance in respect of which the Borrower has selected
a Eurodollar Interest Period of six months, the day which is
three months after the first day of such Interest Period and the
last day of such Interest Period, (iv) as to any Competitive Bid
Loan as to which the Borrower has selected an Interest Period of
90 days or less, the last day of such Competitive Interest
Period, and (v) as to any Competitive Bid Loan as to which the
Borrower has selected a Competitive Interest Period of more than
90 days, the day which is 90 days after the first day of such
Competitive Interest Period and the last day of such Competitive
Interest Period.
"Interest Period": a Eurodollar Interest Period or a
Competitive Interest Period, as the context may require.
"Investments": as defined in Section 8.5.
"Invitation to Bid": an invitation to make Competitive
Bids in the form of Exhibit E.
"Lien": any mortgage, pledge, hypothecation, assignment,
deposit or preferential arrangement, encumbrance, lien (statutory
or other), or other security agreement or security interest of
any kind or nature whatsoever, including, without limitation, any
conditional sale or other title retention agreement and any
capital or financing lease having substantially the same economic
effect as any of the foregoing.
"Loan Documents": collectively, this Agreement, the Notes
and the Pledge Agreement.
"Loans": the Revolving Credit Loans and/or the Competitive
Bid Loans, as the case may be.
"Margin Stock": any "margin stock", as defined in
Regulation U of the Board of Governors of the Federal Reserve
System, as the same may be amended or supplemented from time to
time.
"Material Adverse Change": a material adverse change in
(i) the financial condition, operations, business or Property of
the Borrower and its Subsidiaries taken as a whole or (ii) the
ability of the Borrower to perform its obligations under the Loan
Documents.
"Material Adverse Effect": a material adverse effect on
(i) the financial condition, operations, business or Property of
the Borrower and its Subsidiaries taken as a whole or (ii) the
ability of the Borrower to perform its obligations under the Loan
Documents.
"Maturity Date": September 26, 1996, or any date
subsequent thereto resulting from an extension of the Maturity
Date pursuant to Section 2.18, or such earlier date on which the
Notes shall become due and payable, whether by acceleration or
otherwise.
"Maximum Offer": as defined in Section 2.4(b).
"Maximum Request": as defined in Section 2.4(a).
"Moody's": Moody's Investors Service, Inc., or any
successor thereto.
"Multiemployer Plan": a Pension Plan which is a
multiemployer plan as defined in Section 4001(a)(3) of ERISA.
"Nonconsenting Lender": as defined in Section 2.18.
"Note": a Revolving Credit Note or a Competitive Bid Note,
as the case may be.
"Notes": the Revolving Credit Notes and/or the Competitive
Bid Notes, as the case may be.
"Notice of Conversion/Continuation": a notice
substantially in the form of Exhibit I.
"Operating Subsidiaries": collectively (i) Atlantic
Generation, Inc., (ii) ATE, (iii) Atlantic Thermal, (iv) Atlantic
Jersey Thermal Systems, Inc., (v) Atlantic Energy Technologies,
Inc. and (vi) and each other Subsidiary of the Borrower engaged
in the conduct of an active trade or business which is designated
as an Operating Subsidiary pursuant to Section 8.7.
"PBGC": the Pension Benefit Guaranty Corporation
established pursuant to Subtitle A of Title IV of ERISA, or any
Governmental Authority succeeding to the functions thereof.
"Pension Plan": at any date of determination, any Employee
Benefit Plan (including a Multiemployer Plan), the funding
requirements of which (under Section 302 of ERISA or Section 412
of the Code) are, or at any time within the six years immediately
preceding such date, were in whole or in part, the responsibility
of the Borrower, any of its Subsidiaries or any ERISA Affiliate.
"Permitted Investments": Investments permitted under
Section 8.5.
"Permitted Liens": Liens permitted to exist under Section
8.2.
"Permitted Recipient": a Person in which the Borrower owns
50% or less of the Stock or voting power.
"Permitted Recipient Loans": loans from time to time made
to a Permitted Recipient by the Borrower to the extent permitted
by Section 8.5.
"Person": any individual, firm, partnership, joint
venture, corporation, association, business enterprise, limited
liability company, joint stock company, unincorporated
association, trust, Governmental Authority or any other entity,
whether acting in an individual, fiduciary, or other capacity,
and for the purpose of the definition of "ERISA Affiliate", a
trade or business.
"Pledge Agreement": the Pledge Agreement, made by the
Borrower in favor of the Agent, as collateral agent for itself,
the Lenders, the Facility B Agent and the Facility B Lenders,
substantially in the form of Exhibit L, as the same may be
amended, supplemented or otherwise modified from time to time.
"Portion": as defined in Section 2.4(b).
"Pricing Level I": any time when the Senior Debt Rating is
(i) A- or higher by S&P or (ii) A3 or higher by Moody's,
provided, however, that in the event that (x) the Senior Debt
Rating is not available from either S&P or Moody's, such rating
agency shall be deemed to have assigned its lowest rating and (y)
the Senior Debt Rating is not available from both S&P and
Moody's, Pricing Level IV shall be applicable.
"Pricing Level II": any time when (i) the Senior Debt
Rating is (a) BBB or higher by S&P or (b) Baa2 or higher by
Moody's and (ii) Pricing Level I does not apply, provided,
however, that in the event that (x) the Senior Debt Rating is not
available from either S&P or Moody's, such rating agency shall be
deemed to have assigned its lowest rating and (y) the Senior Debt
Rating is not available from both S&P and Moody's, Pricing Level
IV shall be applicable.
"Pricing Level III": any time when (i) the Senior Debt
Rating is (a) BBB- or higher by S&P or (b) Baa3 or higher by
Moody's and (ii) Pricing Levels I and II do not apply, provided,
however, that in the event that (x) the Senior Debt Rating is not
available from either S&P or Moody's, such rating agency shall be
deemed to have assigned its lowest rating and (y) the Senior Debt
Rating is not available from both S&P and Moody's, Pricing Level
IV shall be applicable.
"Pricing Level IV": any time when Pricing Levels I, II and
III do not apply.
"Prohibited Transaction": a transaction that is prohibited
under Section 4975 of the Code or Section 406 of ERISA and not
exempt under Section 4975 of the Code or Section 408 of ERISA.
"Property": all types of real, personal, tangible,
intangible or mixed property.
"Real Property": all real property owned or leased (or
previously owned or leased) by the Borrower or any of its
Subsidiaries (or any of their respective predecessors).
"Replacement Lender": as defined in Section 2.18.
"Reportable Event": with respect to any Pension Plan, (i)
any event set forth in Sections 4043(b) (other than a Reportable
Event as to which the 30 day notice requirement is waived by the
PBGC under applicable regulations), 4062(c) or 4063(a) of ERISA
or the regulations thereunder, (ii) an event requiring the
Borrower, any of its Subsidiaries or any ERISA Affiliate to
provide security to a Pension Plan under Section 401(a)(29) of
the Code, or (iii) any failure to make any payment required by
Section 412(m) of the Code.
"Required Lenders": (i) if the Commitments exist and no
Revolving Credit Loans are outstanding, Lenders having
Commitments equal to at least 66-2/3% of the sum of the Aggregate
Commitments; (ii) if the Commitments exist and Revolving Credit
Loans are outstanding, Lenders holding Revolving Credit Notes
having an aggregate unpaid principal balance equal to at least
66-2/3% of the aggregate of Revolving Credit Loans outstanding;
and (iii) if the Commitments have been terminated or otherwise no
longer exist, Lenders holding Notes having an aggregate unpaid
principal balance equal to at least 66-2/3% of the aggregate of
Loans outstanding.
"Restricted Payment": as to any Person (i) any dividend or
other distribution, direct or indirect, on account of any shares
of any class of Stock or other equity interest in such Person now
or hereafter outstanding (other than a dividend payable solely in
shares of such Stock to the holders of such shares) and (ii) any
redemption, retirement, sinking fund or similar payment, purchase
or other acquisition, direct or indirect, of any shares of any
class of Stock or other equity interest in such Person now or
hereafter outstanding.
"Restricted Subsidiaries": collectively, the Operating
Subsidiaries and ACE.
"Revolving Credit Loans": as defined in Section 2.1.
"Senior Debt Rating": the long-term senior secured debt
rating of ACE as from time to time determined by S&P and/or
Moody's.
"S&P": Standard & Poor's Ratings Group, a division of
McGraw-Hill, Inc., or any successor thereto.
"SEC": the Securities and Exchange Commission or any
Governmental Authority succeeding to the functions thereof.
"Special Counsel": Emmet, Marvin & Martin, LLP, special
counsel to the Agent.
"Stock": any and all shares, rights, interests,
participations, warrants or other equivalents (however
designated) of corporate stock.
"Submission Deadline": as defined in Section 2.4(b).
"Subsidiary": as to any Person, any corporation,
association, partnership, limited liability company, joint
venture or other business entity of which such Person or any
Subsidiary of such Person, directly or indirectly, either (i) in
respect of a corporation, owns or controls more than 50% of the
outstanding Stock having ordinary voting power to elect a
majority of the board of directors or similar managing body,
irrespective of whether a class or classes shall or might have
voting power by reason of the happening of any contingency, or
(ii) in respect of an association, partnership, joint venture or
other business entity, is entitled to share in more than 50% of
the profits and losses, however determined.
"Tax": any present or future tax, levy, impost, duty,
charge, fee, deduction or withholding of any nature and whatever
called, by a Governmental Authority, on whomsoever and wherever
imposed, levied, collected, withheld or assessed.
"Tax on the Overall Net Income": as to any Person, a Tax
imposed by the jurisdiction in which that Person's principal
office (and/or, in the case of a Lender, its Domestic Lending
Office) is located or by any political subdivision or taxing
authority thereof or in which that Person is deemed to be doing
business on all or part of the net income, profits or gains of
that Person (whether worldwide, or only insofar as such income,
profits or gains are considered to arise in or to relate to a
particular jurisdiction, or otherwise).
"Termination Event": with respect to any Pension Plan, (i)
a Reportable Event, (ii) the termination of a Pension Plan, or
the filing of a notice of intent to terminate a Pension Plan, or
the treatment of a Pension Plan amendment as a termination under
Section 4041(c) of ERISA, (iii) the institution of proceedings to
terminate a Pension Plan under Section 4042 of ERISA, or (iv) the
appointment of a trustee to administer any Pension Plan under
Section 4042 of ERISA.
"United States": the United States of America (including
the States thereof and the District of Columbia).
1.2. Principles of Construction
(a) All terms defined in a Loan Document shall have the
meanings given such terms therein when used in the other Loan
Documents or any certificate, opinion or other document made or
delivered pursuant thereto, unless otherwise defined therein.
(b) As used in the Loan Documents and in any certificate,
opinion or other document made or delivered pursuant thereto,
accounting terms not defined in Section 1.1, and accounting terms
partly defined in Section 1.1, to the extent not defined, shall
have the respective meanings given to them under GAAP.
(c) The words "hereof", "herein", "hereto" and
"hereunder" and similar words when used in a Loan Document shall
refer to such Loan Document as a whole and not to any particular
provision thereof, and Section, schedule and exhibit references
contained therein shall refer to Sections thereof or schedules or
exhibits thereto unless otherwise expressly provided therein.
(d) The phrase "may not" is prohibitive and not
permissive.
(e) Unless the context otherwise requires, words in the
singular number include the plural, and words in the plural
include the singular.
(f) Unless specifically provided in a Loan Document to
the contrary, references to a time shall refer to New York City
time.
(g) Unless specifically provided in a Loan Document to
the contrary, 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".
(h) References in any Loan Document to a fiscal period
shall refer to that fiscal period of the Borrower.
2. AMOUNT AND TERMS OF LOANS
2.1. Revolving Credit Loans
Subject to the terms and conditions hereof, each Lender
severally agrees to make revolving credit loans (each a
"Revolving Credit Loan" and, as the context may require,
collectively with all other Revolving Credit Loans of such Lender
and with the Revolving Credit Loans of all other Lenders, the
"Revolving Credit Loans") to the Borrower from time to time
during the Commitment Period, provided, however, that immediately
after giving effect thereto (i) such Lender's Credit Exposure
would not exceed such Lender's Commitment, and (ii) the Aggregate
Credit Exposure would not exceed the Aggregate Commitments.
During the Commitment Period, the Borrower may borrow, prepay in
whole or in part and reborrow under the Aggregate Commitments,
all in accordance with the terms and conditions of this
Agreement.
2.2. Revolving Credit Notes
The Revolving Credit Loans made by a Lender shall be
evidenced by a promissory note of the Borrower, substantially in
the form of Exhibit B-1, with appropriate insertions therein as
to date and principal amount (each, as indorsed or modified from
time to time, a "Revolving Credit Note" and, collectively with
the Revolving Credit Notes of all other Lenders, the "Revolving
Credit Notes"), payable to the order of such Lender for the
account of its Applicable Lending Office and representing the
obligation of the Borrower to pay the lesser of (i) the original
amount of the Commitment of such Lender and (ii) the aggregate
unpaid principal balance of all Revolving Credit Loans made by
such Lender, with interest thereon as prescribed in Section 2.8.
Each Revolving Credit Note shall (iii) be dated the first
Borrowing Date, (iv) be stated to mature on the Maturity Date and
(v) bear interest from the date thereof on the unpaid principal
balance thereof at the applicable interest rate or rates per
annum determined as provided in Section 2.8. Interest shall be
payable as specified in Section 2.8.
2.3. Procedure for Borrowing Revolving Credit Loans
(a) The Borrower may borrow Revolving Credit Loans under
the Aggregate Commitments on any Business Day during the
Commitment Period, provided, however, that the Borrower shall
notify the Agent in writing by facsimile transmission no later
than (i) 12:00 p.m., three Business Days prior to the requested
Borrowing Date, in the case of Eurodollar Advances and (ii) 11:30
a.m. on the requested Borrowing Date, in the case of ABR
Advances, in each case specifying (A) the aggregate principal
amount to be borrowed under the Aggregate Commitments, (B) the
requested Borrowing Date, (C) whether such borrowing is to
consist of one or more Eurodollar Advances, ABR Advances, or a
combination thereof and (D) if the borrowing is to consist of one
or more Eurodollar Advances, the length of the Eurodollar
Interest Period for each such Eurodollar Advance, provided,
however, that no Eurodollar Interest Period selected in respect
of any Revolving Credit Loan shall end after the Maturity Date.
If the Borrower fails to give timely notice in connection with a
request for a Eurodollar Advance, the Borrower shall be deemed to
have elected that such Advance shall be made as an ABR Advance.
Each such notice shall be irrevocable and confirmed promptly (and
in any event within five Business Days) by delivery to the Agent
of a manually signed Borrowing Request. Each ABR Advance shall
be in an aggregate principal amount equal to $1,000,000 or an
integral multiple of $1,000,000 in excess thereof (or, if the
unused amount of the Aggregate Commitments is less than such
amount, then such lesser amount of the Aggregate Commitments),
and each Eurodollar Advance shall be in an aggregate principal
amount equal to $1,000,000 or an integral multiple of $1,000,000
in excess thereof.
(b) Upon receipt of each notice of borrowing from the
Borrower, the Agent shall promptly notify each Lender thereof.
Subject to its receipt of the notice referred to in the preceding
sentence, each Lender will make the amount of its Commitment
Percentage of each borrowing available to the Agent for the
account of the Borrower at the office of the Agent set forth in
Section 11.2 not later than 2:00 p.m. on the relevant Borrowing
Date requested by the Borrower, in funds immediately available to
the Agent at such office. The amounts so made available to the
Agent on such Borrowing Date will then, subject to the
satisfaction of the terms and conditions of this Agreement, as
determined by the Agent, be made available on such date to the
Borrower by the Agent at the office of the Agent specified in
Section 11.2 by crediting the account of the Borrower on the
books of such office with the aggregate of said amounts received
by the Agent.
(c) Unless the Agent shall have received prior notice
from a Lender (by telephone or otherwise, such notice to be
promptly confirmed by fax or other writing) that such Lender will
not make available to the Agent such Lender's Commitment
Percentage of the Revolving Credit Loans requested by the
Borrower, the Agent may assume that such Lender has made such
share available to the Agent on the Borrowing Date in accordance
with this Section, provided that such Lender received notice of
the proposed borrowing from the Agent, and the Agent may, in
reliance upon such assumption, make available to the Borrower on
the Borrowing Date a corresponding amount. If and to the extent
such Lender shall not have so made its Commitment Percentage of
such Loans available to the Agent, such Lender and the Borrower
severally agree to pay to the Agent forthwith on demand such
corresponding amount (to the extent not previously paid by the
other), together with interest thereon for each day from the date
such amount is made available to the Borrower to the date such
amount is paid to the Agent, at a rate per annum equal to, in the
case of the Borrower, the applicable interest rate set forth in
Section 2.8 for such Loans, and, in the case of such Lender, the
Federal Funds Rate in effect on each such day (as determined by
the Agent). Such payment by the Borrower, however, shall be
without prejudice to its rights against such Lender. If such
Lender shall pay to the Agent such corresponding amount, such
amount so paid shall constitute such Lender's Revolving Credit
Loan as part of the Revolving Credit Loans for purposes of this
Agreement, which Revolving Credit Loan shall be deemed to have
been made by such Lender on the Borrowing Date applicable to such
Revolving Credit Loans.
(d) If a Lender makes a new Revolving Credit Loan on a
Borrowing Date on which the Borrower is to repay a Revolving
Credit Loan or Competitive Bid Loan from such Lender, such Lender
shall apply the proceeds of such new Revolving Credit Loan to
make such repayment, and only the excess of the proceeds of such
new Revolving Credit Loan over the Revolving Credit Loan or
Competitive Bid Loan being repaid need be made available to the
Agent.
(e) Notwithstanding the provisions of Section 2.3(a), the
Agent may act without liability upon the basis of telephonic
notice of borrowing believed by the Agent in good faith to be
from an authorized officer of the Borrower prior to receipt of
written notice and confirmation by facsimile or otherwise. In
each such case, the Borrower waives the right to dispute the
Agent's record of the terms of such telephone notice of such
borrowing.
2.4. Competitive Bid Loans; Procedure
(a) The Borrower may make Competitive Bid Requests by
12:00 p.m. at least one Business Day prior to the proposed
Borrowing Date for one or more Competitive Bid Loans. Each
Competitive Bid Request given to the Agent (which shall promptly
on the same day give notice thereof to each Lender by facsimile
transmission of an Invitation to Bid if the Competitive Bid
Request is not rejected pursuant to this Section), shall be given
in writing by facsimile transmission (confirmed promptly, and in
any event within five Business Days, by the delivery to the Agent
of a Competitive Bid Request manually signed by the Borrower),
and shall specify (i) the proposed Borrowing Date, which shall be
a Business Day, (ii) the aggregate amount of the requested
Competitive Bid Loans (the "Maximum Request") which amount (A)
shall not exceed an amount which, on the proposed Borrowing Date
and after giving effect to the requested Competitive Bid Loans,
would cause the Aggregate Credit Exposure to exceed the
Aggregate Commitments and (B) shall be in a principal amount
equal to $1,000,000 or an integral multiple of $1,000,000 in
excess thereof, (iii) the Competitive Interest Period(s) therefor
and the last day of each such Competitive Interest Period, and
(iv) if more than one Competitive Interest Period is so
specified, the principal amount allocable to each such
Competitive Interest Period (which amount shall not be less than
$1,000,000 or an integral multiple of $1,000,000 in excess
thereof). A Competitive Bid Request that does not conform
substantially to the form of Exhibit D shall be rejected, and the
Agent shall promptly notify the Borrower of such rejection.
Notwithstanding anything contained herein to the contrary, (1)
not more than three Competitive Interest Periods may be requested
pursuant to any Competitive Bid Request and (2) not more than
three Competitive Bid Loans may be outstanding at any one time.
(b) Each Lender in its sole discretion may (but is not
obligated to) submit one or more Competitive Bids to the Agent
not later than 10:00 a.m. on the proposed Borrowing Date
specified in such Competitive Bid Request (such time being herein
called the "Submission Deadline"), by fax or other writing, and
thereby irrevocably offer to make all or any part (any such part
referred to as a "Portion") of any Competitive Bid Loan described
in the relevant Competitive Bid Request at a rate of interest per
annum (each a "Bid Rate") specified therein in an aggregate
principal amount of not less than $1,000,000 or an integral
multiple of $1,000,000 in excess thereof, provided that
Competitive Bids submitted by BNY may only be submitted if BNY
notifies the Borrower of the terms of its Competitive Bid not
later than thirty minutes prior to the Submission Deadline.
Multiple Competitive Bids may be delivered to the Agent by a
Lender. The aggregate Portions of Competitive Bid Loans for any
or all Competitive Interest Periods offered by each Lender in its
Competitive Bid may exceed the Maximum Request contained in the
relevant Competitive Bid Request, provided that each Competitive
Bid shall set forth the maximum aggregate amount of the
Competitive Bid Loans offered thereby which the Borrower may
accept (the "Maximum Offer"), which Maximum Offer shall not
exceed the Maximum Request. If the Agent has not received a
Competitive Bid from any Lender by the Submission Deadline, such
Lender shall be deemed not to have made a Competitive Bid and
shall not be permitted or obligated to make a Competitive Bid
Loan on the proposed Borrowing Date.
(c) The Agent shall promptly give notice by telephone
(promptly confirmed by fax or other writing) to the Borrower of
all Competitive Bids received by the Agent prior to the
Submission Deadline which comply in all material respects with
this Section. The Borrower shall, in its sole discretion but
subject to Section 2.4(d), irrevocably accept or reject any such
Competitive Bid (or any Portion thereof) not later than 10:30
a.m. on the day of the Submission Deadline by notice to the Agent
by telephone (confirmed by fax or other writing in the form of a
Competitive Bid Accept/Reject Letter promptly the same day).
Promptly upon receipt by the Agent of such a Competitive Bid
Accept/Reject Letter, the Agent will give notice to each Lender
that submitted a Competitive Bid as to the extent, if any, that
such Lender's Competitive Bid shall have been accepted. If the
Agent fails to receive notice from the Borrower of its acceptance
or rejection of any Competitive Bids at or prior to 10:30 a.m. on
the day of the Submission Deadline, all such Competitive Bids
shall be deemed to have been rejected by the Borrower, and the
Agent will give to each Lender that submitted a Competitive Bid
notice of such rejection by telephone on such day. In due course
following the acceptance of any Competitive Bid, the Agent shall
notify each Lender which submitted a Competitive Bid, in the
form of a Competitive Bid Loan Confirmation, of the amount,
maturity date and Bid Rate for each Competitive Bid Loan.
(d) If the Borrower accepts a Portion of a proposed
Competitive Bid Loan for a single Competitive Interest Period at
the Bid Rate provided therefor in a Lender's Competitive Bid,
such Portion shall be in a principal amount of $1,000,000 or an
integral multiple of $1,000,000 in excess thereof (subject to
such lesser allocation as may be made pursuant to the provisions
of this Section 2.4(d)). The aggregate principal amount of
Competitive Bid Loans accepted by the Borrower following
Competitive Bids responding to a Competitive Bid Request shall
not exceed the Maximum Request. The aggregate principal amount
of Competitive Bid Loans accepted by the Borrower pursuant to a
Lender's Competitive Bid shall not exceed the Maximum Offer
therein contained. If the Borrower accepts any Competitive Bid
Loans or Portion offered in any Competitive Bid, the Borrower
must accept Competitive Bids (and Competitive Bid Loans and
Portions thereby offered) based exclusively upon the successively
lowest Bid Rates within each Competitive Interest Period and no
other criteria. If two or more Lenders submit Competitive Bids
with identical Bid Rates for the same Competitive Interest Period
and the Borrower accepts any thereof, the Borrower shall, subject
to the first three sentences of this Section 2.4(d), accept all
such Competitive Bids as nearly as possible in proportion to the
amounts of such Lender's respective Competitive Bids with
identical Bid Rates for such Competitive Interest Period,
provided, that if the amount of Competitive Bid Loans to be so
allocated is not sufficient to enable each such Lender to make
such Competitive Bid Loan (or Portions thereof) in an aggregate
principal amount of $1,000,000 or an integral multiple of
$1,000,000 in excess thereof, the Borrower shall round the
Competitive Bid Loans (or Portions thereof) allocated to such
Lender or Lenders as the Borrower shall select as necessary to a
minimum of $1,000,000 or an integral multiple of $500,000 in
excess thereof.
(e) Not later than 2:00 p.m. on the relevant Borrowing
Date, each Lender whose Competitive Bid was accepted by the
Borrower shall make available to the Agent at its office set
forth in Section 11.2, in immediately available funds, the
proceeds of such Lender's Competitive Bid Loan(s). The amounts so
made available to the Agent on such Borrowing Date will then,
subject to the satisfaction of the terms and conditions of this
Agreement, as determined by the Agent, be made available on such
date to the Borrower by the Agent at the office of the Agent
specified in Section 11.2 by crediting the account of the
Borrower on the books of such office with the aggregate of said
amounts received by the Agent.
(f) All notices required by this Section 2.4 shall be
given in accordance with Section 11.2.
(g) The Competitive Bid Loans made by each Lender shall
be evidenced by a promissory note of the Borrower, substantially
in the form of Exhibit B-2 (each, as indorsed or modified from
time to time, a "Competitive Bid Note" and, collectively with the
Competitive Bid Notes of all other Lenders, the "Competitive Bid
Notes"), payable to the order of such Lender for the account of
its Applicable Lending Office, and dated the first Borrowing
Date. Each Competitive Bid Loan shall be due and payable on the
earlier of (i) the last day of the Competitive Interest Period
applicable thereto and (ii) the Maturity Date.
2.5. Voluntary Reduction or Termination of Aggregate
Commitments
The Borrower shall have the right, upon at least three
Business Days' prior written notice to the Agent, at any time to
terminate the Aggregate Commitments or from time to time to
permanently reduce the Aggregate Commitments, provided, however,
that each such reduction shall be in the amount of $5,000,000 or
an integral multiple of $1,000,000 in excess thereof. Each
reduction of the Aggregate Commitments shall be applied pro rata
according to the Commitment Percentage of each Lender.
Simultaneously with each reduction of the Aggregate Commitments
under this Section, the Borrower shall (i) pay the Facility Fee
accrued on the amount by which the Aggregate Commitments have
been reduced and (ii) prepay the Loans as required by Section
2.6. The Aggregate Commitments shall not be reduced below an
amount equal to the Aggregate Credit Exposure (after giving
effect to any prepayment of the Loans made simultaneously with
such reduction of the Aggregate Commitments). The Aggregate
Commitments shall not be reduced to the extent that, immediately
after giving effect thereto, the Commitment of any Lender would
exceed the the aggregate principal amount of all Revolving Credit
Loans then outstanding from such Lender.
2.6. Prepayments of the Loans
(a) Voluntary Prepayments. The Borrower may, at its
option, prepay the Revolving Credit Loans without premium or
penalty, in full at any time or in part from time to time by
notifying the Agent in writing no later than 11:30 a.m. on the
date of the proposed prepayment date, in the case of Revolving
Credit Loans consisting of ABR Advances and no later than 12:00
p.m. on the third Business Day prior to the proposed prepayment
date, in the case of Revolving Credit Loans consisting of
Eurodollar Advances, specifying the Revolving Credit Loans to be
prepaid, the amount to be prepaid and the date of prepayment.
Competitive Bid Loans may not be prepaid. Such notice shall be
irrevocable and the amount specified in such notice shall be due
and payable on the date specified, together with accrued interest
to the date of such payment on the amount prepaid. Upon receipt
of such notice, the Agent shall promptly notify each Lender
thereof. Each partial prepayment of Revolving Credit Loans shall
be in an aggregate principal amount of (A) $1,000,000 or an
integral multiple of $1,000,000 in excess thereof, or (B) if the
outstanding principal balance of the Revolving Credit Loans is
less that the minimum amounts set forth in clause (A), then such
lesser outstanding principal balance. After giving effect to any
partial prepayment with respect to Eurodollar Advances which were
made (whether as the result of a borrowing or a conversion) on
the same date and which had the same Interest Period, the
outstanding principal amount of such Eurodollar Advances shall
exceed (subject to Section 2.7) $1,000,000 or an integral
multiple of $1,000,000 in excess thereof. If any prepayment is
made in respect of any Eurodollar Advance or Competitive Bid
Loan, in whole or in part, prior to the last day of the
applicable Interest Period, the Borrower agrees to indemnify the
applicable Lenders in accordance with Section 2.13.
(b) Mandatory Prepayments Relating to Reductions of the
Aggregate Commitments. Simultaneously with each reduction of the
Aggregate Commitments under Section 2.5, the Borrower shall
prepay the Loans by the amount, if any, by which the aggregate
unpaid principal balance of the Loans exceeds the amount of the
Aggregate Commitments as so reduced. Such prepayments shall be
applied (i) first, to prepay the Revolving Credit Loans pro rata
according to the Commitment of each Lender, and (ii) then, to
the extent of any excess remaining, to prepay the Competitive Bid
Loans, pro rata according to the outstanding amount of each
Competitive Bid Loan.
2.7. Conversions and Continuations
(a) The Borrower may elect from time to time to convert
Eurodollar Advances to ABR Advances by giving the Agent at least
one Business Day's prior irrevocable notice in writing by
facsimile transmission of such election (confirmed promptly, and
in any event within five Business Days, by the delivery of a
manually signed Notice of Conversion/Continuation), specifying
the amount to be so converted, provided, that any such conversion
of Eurodollar Advances shall only be made on the last day of the
Interest Period applicable thereto. In addition, the Borrower
may elect from time to time to (i) convert ABR Advances to
Eurodollar Advances and (ii) to continue Eurodollar Advances by
selecting a new Interest Period therefor, in each case by giving
the Agent at least three Business Days' prior irrevocable notice
in writing by facsimile transmission of such election (confirmed
promptly, and in any event within five Business Days, by the
delivery of a manually signed Notice of Conversion/Continuation),
in the case of a conversion to, or continuation of, Eurodollar
Advances, specifying the amount to be so converted and the
initial Interest Period relating thereto, provided that any such
conversion of ABR Advances to Eurodollar Advances shall only be
made on a Business Day and any such continuation of Eurodollar
Advances shall only be made on the last day of the Interest
Period applicable to the Eurodollar Advances which are to be
continued as such new Eurodollar Advances. The Agent shall
promptly provide the Lenders with a copy of each such Notice of
Conversion/Continuation. ABR Advances and Eurodollar Advances
may be converted or continued pursuant to this Section in whole
or in part, provided that conversions of ABR Advances to
Eurodollar Advances, or continuations of Eurodollar Advances
shall be in an aggregate principal amount of $1,000,000 or such
amount plus a whole multiple of $1,000,000 in excess thereof.
(b) Notwithstanding anything in this Section to the
contrary, no ABR Advance may be converted to a Eurodollar Advance
and no Eurodollar Advance may be continued, if the Borrower or
the Agent has knowledge that a Default or Event of Default has
occurred and is continuing either (i) at the time the Borrower
shall notify the Agent of its election to convert or continue or
(ii) on the requested Conversion/Continuation Date. In such
event, such ABR Advance shall be automatically continued as an
ABR Advance, or such Eurodollar Advance shall be automatically
converted to an ABR Advance on the last day of the Interest
Period applicable to such Eurodollar Advance. If an Event of
Default shall have occurred and be continuing, the Agent shall,
at the request of the Required Lenders, notify the Borrower (by
telephone or otherwise) that all, or such lesser amount as the
Required Lenders shall designate, of the outstanding Eurodollar
Advances shall be automatically converted to ABR Advances, in
which event such Eurodollar Advances shall be automatically
converted to ABR Advances on the date such notice is given.
(c) No Interest Period selected in respect of conversion
or continuation of any Eurodollar Advance shall end after the
Maturity Date.
(d) Each conversion or continuation shall be effected by
each Lender by applying the proceeds of its new ABR Advance or
Eurodollar Advance, as the case may be, to its Advances (or
portion thereof) being converted (it being understood that such
conversion shall not constitute a borrowing for purposes of
Sections 4, 5 or 6).
(e) Notwithstanding the provisions of Section 2.7(a), the
Agent may act without liability upon the basis of telephonic
notice of such conversion or continuation believed by the Agent
in good faith to be from an authorized officer of the Borrower
prior to receipt of written notice and confirmation, by facsimile
or otherwise. In each such case, the Borrower waives the right
to dispute the Agent's record of the terms of such telephone
notice of such conversion or continuation.
2.8. Interest Rate and Payment Dates
(a) Prior to Maturity. Except as otherwise provided in
Section 2.8(b), prior to maturity, the Loans shall bear interest
on the outstanding principal balance thereof at the applicable
interest rate or rates per annum set forth below:
ADVANCES RATE
Each ABR Advance Alternate Base Rate.
Each Eurodollar Advance Eurodollar Rate for the
applicable Interest Period
plus the Applicable Margin.
Each Competitive Bid Rate applicable thereto
Bid Loan for the applicable
Competitive Interest
Period.
Late Charges. If all or any portion of the principal balance of
or interest payable on any of the Loans or any other amount
payable under the Loan Documents shall not be paid when due
(whether at the stated maturity thereof, by acceleration or
otherwise), such overdue balance or amount shall bear interest at
a rate per annum (whether before or after the entry of a judgment
thereon) equal to 2% plus the rate which would otherwise be
applicable pursuant to Section 2.8(a), from the date of such
nonpayment to, but not including, the date such balance is paid
in full. All such interest shall be payable on demand.
(b) In General. Interest on (i) ABR Advances to the
extent based on the BNY Rate shall be calculated on the basis of
a 365 or 366-day year (as the case may be), and (ii) ABR Advances
to the extent based on the Federal Funds Rate, on Eurodollar
Advances and on Competitive Bid Loans shall be calculated on the
basis of a 360-day year, in each case, for the actual number of
days elapsed, including the first day but excluding the last.
Except as otherwise provided in Section 2.8(b), interest shall be
payable in arrears on each Interest Payment Date and upon each
payment (including prepayment) of the Loans. Any change in the
interest rate on the Loans resulting from a change in the
Alternate Base Rate or reserve requirements shall become
effective as of the opening of business on the day on which such
change shall become effective. The Agent shall, as soon as
practicable, notify the Borrower and the Lenders of the effective
date and the amount of each such change in the BNY Rate, but any
failure to so notify shall not in any manner affect the
obligation of the Borrower to pay interest on the Loans in the
amounts and on the dates required. Each determination of the
Alternate Base Rate or a Eurodollar Rate by the Agent pursuant
to this Agreement shall be conclusive and binding on all parties
hereto absent manifest error. At no time shall the interest rate
payable on the Loans, together with the Facility Fee and all
other amounts payable under the Loan Documents, to the extent the
same are construed to constitute interest, exceed the Highest
Lawful Rate. If any amount paid hereunder would exceed the
maximum amount of interest permitted by the Highest Lawful Rate,
then such amount shall automatically be reduced to such maximum
permitted amount, and interest for any subsequent period, to the
extent less than the maximum amount permitted for such period by
the Highest Lawful Rate, shall be increased by the unpaid amount
of such reduction. Any interest actually received for any period
in excess of such maximum allowable amount for such period shall
be deemed to have been applied as a prepayment of the Loans. The
Borrower acknowledges that to the extent interest payable on ABR
Advances is based on the BNY Rate, the BNY Rate is only one of
the bases for computing interest on loans made by the Lenders,
and by basing interest payable on ABR Advances on the BNY Rate,
the Lenders have not committed to charge, and the Borrower has
not in any way bargained for, interest based on a lower or the
lowest rate at which the Lenders may now or in the future make
loans to other borrowers.
2.9. Substituted Interest Rate
In the event that (i) the Agent shall have determined
(which determination shall be conclusive and binding upon the
Borrower) that by reason of circumstances affecting the interbank
eurodollar market either adequate and reasonable means do not
exist for ascertaining the Eurodollar Rate or (ii) any Lender
shall have notified the Agent that it has determined (which
determination shall be conclusive and binding on the Borrower)
that the applicable Eurodollar Rate will not adequately and
fairly reflect the cost to such Lender of maintaining or funding
loans bearing interest based on such Eurodollar Rate, with
respect to any portion of the Revolving Credit Loans that the
Borrower has requested be made as Eurodollar Advances or
Eurodollar Advances that will result from the requested
conversion or continuation of any portion of the Advances into or
as Eurodollar Advances (each, an "Affected Advance"), the Agent
shall promptly notify the Borrower and the Lenders (by telephone
or otherwise, to be promptly confirmed in writing) of such
determination on or, to the extent practicable, prior to the
requested Borrowing Date or Conversion/Continuation Date for such
Affected Advances. If the Agent shall give such notice, (a) any
Affected Advances shall be made as ABR Advances, (b) the Advances
(or any portion thereof) that were to have been converted to or
continued as Affected Advances shall be converted to or continued
as ABR Advances and (c) any outstanding Affected Advances shall
be converted, on the last day of the then current Interest Period
with respect thereto, to ABR Advances. Until any notice under
clauses (i) or (ii), as the case may be, of this Section has been
withdrawn by the Agent (by notice to the Borrower promptly upon
either (1) the Agent having determined that such circumstances
affecting the interbank eurodollar market no longer exist and
that adequate and reasonable means do exist for determining the
Eurodollar Rate pursuant to Section 2.8 or (2) the Agent having
been notified by such Lender that circumstances no longer render
the Advances (or any portion thereof) Affected Advances, no
further Eurodollar Advances shall be required to be made by the
Lenders, nor shall the Borrower have the right to convert or
continue all or any portion of the Loans to Eurodollar Advances.
2.10. Taxes
(a) Payments to Be Free and Clear. Provided that all
documentation, if any, then required to be delivered by any
Lender or the Agent pursuant to subsection (c) has been
delivered, all sums payable by the Borrower under the Loan
Documents shall (except to the extent required by law) be paid
free and clear of and without any deduction or withholding on
account of any Tax (other than a Tax on the Overall Net Income of
any Lender (for which payment need not be free and clear but no
deduction or withholding shall be made unless then required by
applicable law)) imposed, levied, collected, withheld or assessed
by or within the United States or any political subdivision in or
of the United States or any other jurisdiction from or to which a
payment is made by or on behalf of the Borrower or by any
federation or organization of which the United States or any such
jurisdiction is a member at the time of payment.
(b) Grossing-up of Payments. If the Borrower or any other
Person is required by law to make any deduction or withholding on
account of any such Tax (other than a Tax on the Overall Net
Income of a Lender) from any sum paid or payable by the Borrower
to the Agent or any Lender under any of the Loan Documents:
(i) the Borrower shall notify the Agent and such
Lender of any such requirement or any change in any such
requirement as soon as the Borrower becomes aware of it;
(ii) the Borrower shall pay any such Tax before the
date on which penalties attach thereto, such payment to be made
(if the liability to pay is imposed on the Borrower) for its
own account or (if that liability is imposed on the Agent or
such Lender, as the case may be) on behalf of and in the name
of the Agent or such Lender;
(iii) the sum payable by the Borrower to the Agent or
a Lender in respect of which the relevant deduction,
withholding or payment is required shall be increased to the
extent necessary to ensure that, after the making of that
deduction, withholding or payment, the Agent or such Lender, as
the case may be, receives on the due date therefor a net sum
equal to what it would have received had no such deduction,
withholding or payment been required or made; and
(iv) within 30 days after paying any sum from which
it is required by law to make any deduction or withholding, and
within 30 days after the due date of payment of any Tax which
it is required by clause (b) above to pay, the Borrower shall
deliver to the Agent and the applicable Lender evidence
satisfactory to the other affected parties of such deduction,
withholding or payment and of the remittance thereof to the
relevant Governmental Authority;
provided that no such additional amount shall be required to be
paid to any Lender under clause (iii) above except to the extent
that any change after the date hereof (in the case of each Lender
listed on the signature pages hereof) or after the date of the
Assignment and Acceptance Agreement pursuant to which such Lender
became a Lender (in the case of each other Lender) in any such
requirement for a deduction, withholding or payment as is
mentioned therein shall result in an increase in the rate of such
deduction, withholding or payment from that in effect at the
date of this Agreement or at the date of such Assignment and
Acceptance, as the case may be, in respect of payments to such
Lender.
(c) Refunds and Credits. If the Borrower makes any
additional payment to any Lender pursuant to this Section 2.10 in
respect of any Tax, and such Lender determines that it has
received (i) a refund of such Tax or (ii) a credit against or
relief or remission for, or a reduction in the amount of, any tax
or other governmental charge attributable solely to any deduction
or credit for any Tax with respect to which it has received
payments under this Section 2.10, such Lender shall to the extent
that it can do so without prejudice to the retention of such
refund, credit, relief, remission or reduction, pay to the
Borrower such amount as such Lender shall have determined to be
attributable to the deduction or withholding of such Tax. If,
within one year after the payment of any such amount to the
Borrower, such Lender determines that it was not entitled to such
refund, credit, relief, remission or reduction to the full extent
of any payment made pursuant to the first sentence of this
Section 2.10(c), the Borrower shall upon notice and demand of
such Lender promptly repay the amount of such overpayment. Any
determination made by such Lender pursuant to this Section
2.10(c) shall in the absence of bad faith or manifest error be
conclusive, and nothing in this Section 2.10(c) shall be
construed as requiring any Lender to conduct its business or to
arrange or alter in any respect its tax or financial affairs
(except as required by Section 2.17(a)) so that it is entitled to
receive such a refund, credit or reduction or as allowing any
person to inspect any records, including tax returns of any
Lender.
(d) Limitation of Liability. No Lender shall be entitled
to demand any payment under this Section 2.10 more than six
months following the payment to or for the account of such Lender
of all other amounts payable hereunder and under any Note held by
such Lender and the termination of such Lender's Commitment;
provided, however, that the foregoing proviso shall in no way
limit the right of any Lender to demand or receive any payment
under this Section 2.10 to the extent that such payment relates
to the retroactive application of any Tax if such demand is made
within six months after the implementation of such Tax.
(e) U.S. Tax Certificates. Each Lender that is organized
under the laws of any jurisdiction other than the United States
shall deliver to the Agent for transmission to the Borrower, on
or prior to the Effective Date (in the case of each Lender listed
on the signature pages hereof) or on the effective date of the
Assignment and Acceptance Agreement pursuant to which it becomes
a Lender (in the case of each other Lender), and at such other
times as may be necessary in the determination of the Borrower or
the Agent (each in the reasonable exercise of its discretion),
such certificates, documents or other evidence, properly
completed and duly executed by such Lender (including, without
limitation, Internal Revenue Service Form W-8, Form 1001 or Form
4224 or any other certificate or statement of exemption required
by Treasury Regulations Section 1.1441-4(a) or Section
1.1441-6(c), or Temporary Treasury Regulations Section 35a9999-4T
or Section 35a9999-5, or any successor thereto) to establish that
such Lender is not subject to deduction or withholding of United
States federal income tax under Section 1441 or 1442 of the Code
or otherwise (or under any comparable provisions of any successor
statute) with respect to any payments to such Lender of
principal, interest, fees or other amounts payable under any of
the Loan Documents. The Borrower shall not be required to pay
any additional amount to any such Lender under subsection
(b)(iii) above if such Lender shall have failed to satisfy the
requirements of the immediately preceding sentence; provided
that if such Lender shall have satisfied such requirements on the
Effective Date (in the case of each Lender listed on the
signature pages hereof) or on the effective date of the
Assignment and Acceptance Agreement pursuant to which it became a
Lender (in the case of each other Lender), nothing in this
subsection shall relieve the Borrower of its obligation to pay
any additional amounts pursuant to subsection (b)(iii) in the
event that, as a result of any change in applicable law, such
Lender is no longer properly entitled to deliver certificates,
documents or other evidence at a subsequent date establishing the
fact that such Lender is not subject to withholding as described
in the immediately preceding sentence.
2.11. Illegality
Notwithstanding any other provisions herein, if any law,
regulation, treaty or directive, or any change therein or in the
interpretation or application thereof, shall make it unlawful for
any Lender to make or maintain its Eurodollar Advances as
contemplated by this Agreement, (i) the commitment of such Lender
hereunder to make Eurodollar Advances or convert ABR Advances to
Eurodollar Advances shall forthwith be suspended and (ii) such
Lender's Loans then outstanding as Eurodollar Advances affected
hereby, if any, shall be converted automatically to ABR Advances
on the last day of the then current Interest Period applicable
thereto or within such earlier period as required by law. If the
commitment of any Lender with respect to Eurodollar Advances is
suspended pursuant to this Section and such Lender shall notify
the Agent and the Borrower that it is once again legal for such
Lender to make or maintain Eurodollar Advances, such Lender's
commitment to make or maintain Eurodollar Advances shall be
reinstated.
Increased Costs
In the event that any law, regulation, treaty or directive
hereafter enacted, promulgated, approved or issued or any change
in any presently existing law, regulation, treaty or directive
therein or in the interpretation or application thereof by any
Governmental Authority charged with the administration thereof or
compliance by any Lender (or any corporation directly or
indirectly owning or controlling such Lender) with any request or
directive from any Governmental Authority:
(a) does or shall subject any Lender to any Taxes of any kind
whatsoever with respect to any Eurodollar Advances or its
obligations under this Agreement to make Eurodollar Advances, or
change the basis of taxation of payments to any Lender of
principal, interest or any other amount payable hereunder in
respect of its Eurodollar Advances, including any Taxes required
to be withheld from any amounts payable under the Loan Documents
(except for imposition of, or change in the rate of, Tax on the
Overall Net Income of such Lender or its Applicable Lending
Office for any of such Advances by the jurisdiction in which such
Lender is incorporated or has its principal office or such
Applicable Lending Office, including, in the case of Lenders
incorporated in any State of the United States, such tax imposed
by the United States); or
(b) does or shall impose, modify or make applicable any
reserve, special deposit, compulsory loan, assessment, increased
cost or similar requirement against assets held by, or deposits
of, or advances or loans by, or other credit extended by, or any
other acquisition of funds by, any office of such Lender in
respect of its Eurodollar Advances which is not otherwise
included in the determination of a Eurodollar Rate;
and the result of any of the foregoing is to increase the cost to
such Lender of making, renewing, converting, continuing or
maintaining its Eurodollar Advances or its commitment to make
such Eurodollar Advances, or to reduce any amount receivable
hereunder in respect of its Eurodollar Advances, then, in any
such case, the Borrower shall pay such Lender, upon its demand,
any additional amounts necessary to compensate such Lender for
such additional cost or reduction in such amount receivable which
such Lender deems to be material as determined by such Lender;
provided, however, that (i) nothing in this Section shall require
the Borrower to indemnify the Lenders with respect to withholding
Taxes for which the Borrower has no obligation under Section
2.10, and (ii) no Lender shall be entitled to demand any payment
under this Section 2.12 more than six months following the
payment to or for the account of such Lender of all other amounts
payable hereunder and under any Note held by such Lender and the
termination of such Lender's Commitment; provided, however, that
the foregoing proviso shall in no way limit the right of any
Lender to demand or receive any payment under this Section 2.12
to the extent that such payment relates to the retroactive
application of any law, regulation, treaty or directive if such
demand is made within six months after the implementation of such
retroactive application. A statement setting forth the
calculations of any additional amounts payable pursuant to the
foregoing sentence submitted by a Lender to the Borrower shall be
conclusive absent manifest error.
2.12. Indemnification for Loss
Notwithstanding anything contained herein to the contrary,
if the Borrower shall fail to borrow, convert or continue an
Advance after it shall have given notice to do so in which it
shall have requested a Eurodollar Advance pursuant to Section 2.3
or 2.7, as the case may be, or if the Borrower shall fail to
borrow a Competitive Bid Loan after it shall have accepted one or
more offers therefor pursuant to Section 2.4, or if a Eurodollar
Advance or a Competitive Bid Loan shall be terminated for any
reason prior to the last day of the Interest Period applicable
thereto, or if any repayment or prepayment of the principal
amount of a Eurodollar Advance or a Competitive Bid Loan is made
for any reason on a date which is prior to the last day of the
Interest Period applicable thereto, the Borrower agrees to
indemnify each Lender against, and to pay on written demand
directly to such Lender the amount (calculated by such Lender
using any method chosen by such Lender which is reasonable and
customarily used by such Lender for such purpose) equal to any
loss or out-of-pocket expense suffered by such Lender as a result
of such failure to borrow, convert or continue, or such
termination, repayment or prepayment, including any loss, cost or
expense suffered by such Lender in liquidating or employing
deposits acquired to fund or maintain the funding of such
Eurodollar Advance or Competitive Bid Loan, as the case may be,
or redeploying funds prepaid or repaid, in amounts which
correspond to such Eurodollar Advance or Competitive Bid Loan, as
the case may be, and any internal processing charge customarily
charged by such Lender in connection therewith. Calculations of
all amounts payable under this Section shall be made on the
assumption that each Lender has funded each of its relevant
Eurodollar Advances and Competitive Bid Loans through the
purchase of deposits bearing interest at the applicable rate of
interest for, in an amount equal to the principal amount of, and
with a maturity equivalent to the Interest Period applicable to,
such Eurodollar Advance or Competitive Bid Loan, as the case may
be.
2.13. Survival of Certain Obligations
The obligations of the Borrower under Sections 2.10, 2.12,
2.13, 2.16, 11.5 and 11.10 shall survive the termination of the
Aggregate Commitments and the payment of the Loans and all other
amounts payable under the Loan Documents.
2.14. Use of Proceeds
The proceeds of the Loans shall be used solely to (i) pay
all of the fees due hereunder, (ii) pay the reasonable
out-of-pocket fees and expenses incurred by the Borrower in
connection with the Loan Documents, (iii) for the general
corporate purposes of the Borrower, including, without
limitation, the making of Intercompany Loans to Operating
Subsidiaries of the Borrower and Permitted Recipient Loans to
Permitted Recipients to the extent permitted by Section 8.5 and
(iv) to make repurchases of its stock to the extent permitted by
Section 8.4. Notwithstanding anything to the contrary contained
in any Loan Document, the Borrower agrees that no part of the
proceeds of any Loan will be used, directly or indirectly, for a
purpose which violates any law, including, without limitation,
the provisions of Regulations G, U or X of the Board of Governors
of the Federal Reserve System, as amended.
2.15. Capital Adequacy
If the amount of capital required or expected to be
maintained by any Lender or any Person directly or indirectly
owning or controlling such Lender (each a "Control Person"),
shall be affected by (i) the introduction or phasing in of any
law, rule or regulation after the Effective Date, (ii) any change
after the Effective Date in the interpretation of any existing
law, rule or regulation by any Governmental Authority charged
with the administration thereof, or (iii) compliance by such
Lender or such Control Person with any directive, guideline or
request from any Governmental Authority (whether or not having
the force of law) promulgated or made after the Effective Date,
and such Lender shall have determined that such introduction,
phasing in, change or compliance shall have had or will
thereafter have the effect of reducing (A) the rate of return on
such Lender's or such Control Person's capital, or (B) the asset
value to such Lender or such Control Person of the Loans made or
maintained by such Lender, in either case to a level below that
which such Lender or such Control Person could have achieved or
would thereafter be able to achieve but for such introduction,
phasing in, change or compliance (after taking into account such
Lender's or such Control Person's policies regarding capital
adequacy) by an amount deemed by such Lender to be material to
such Lender or Control Person, then, within ten days after demand
by such Lender, the Borrower shall pay to such Lender or such
Control Person such additional amount or amounts as shall be
sufficient to compensate such Lender or such Control Person, as
the case may be, for such reduction.
2.16. Change of Lending Office; Right to Substitute Lender
(a) Each Lender agrees that, upon the occurrence of any
event giving rise to the operation of Section 2.12 or 2.13 or to
a requirement under Section 2.10 to withhold and deduct taxes, it
will, if requested by the Borrower, use reasonable efforts
(subject to overall policy considerations of such Lender) to
designate another Applicable Lending Office for any Loans
affected by such event, provided that such designation is made
on such terms that such Lender and its Applicable Lending Office
suffer no economic, legal or regulatory disadvantage, with the
object of avoiding the consequence of the event giving rise to
the operation of any such Section. Except in the case of a
change of Applicable Lending Office made at the request of the
Borrower, no change in Applicable Lending Office will be made if
greater costs and expenses would result under Section 2.12 or
2.13 or if the aforementioned requirement under Section 2.10
would result from any such change in designation. Nothing in
this Section shall affect or postpone any of the obligations of
the Borrower or the rights of any Lender provided in Section
2.10, 2.12, or 2.16.
(b) In addition to the Borrower's rights under subsection
(a) of this Section, upon the occurrence of any event giving rise
to the operation of Section 2.10, 2.12 or 2.13, the Borrower may,
within a period of 60 days following the Borrower's obtaining
knowledge of the occurrence of the event giving rise to the
operation of such provisions, at its own expense, make
arrangements for another bank or financial institution reasonably
acceptable to the Agent to purchase and accept the rights and
obligations under this Agreement of any Lender entitled to
payment under Section 2.10, 2.12 or 2.13, whereupon such Lender
shall assign to the bank or financial institution designated by
the Borrower its rights and obligations hereunder pursuant to the
provisions of Section 11.7 of this Agreement.
2.17. Extension of Maturity Date
(a) Provided that no Default or Event of Default exists
during the periods set forth below, the Borrower may request that
the Maturity Date be extended for additional 329-day periods by
giving written notice of such request (each, an "Extension
Request") to the Agent during the period not more than 90 days
but not less than 60 days prior to the then Maturity Date and,
upon the receipt of such notice, the Agent shall promptly notify
each Lender of such Extension Request.
(i) If all Lenders consent to an Extension Request
during the Extension Consent Period by giving written notice
thereof to the Borrower and the Agent, then, effective on the
then current Maturity Date, such Maturity Date shall be extended
by 329 days from and including the then current Maturity Date,
provided, however, that if the 329th day of such extension falls
on a day that is not a Business Day, such Maturity Date shall be
the next following Business Day.
(ii) If at least Extension Consent Required Lenders
(but not all Lenders) consent to an Extension Request during the
Extension Consent Period (by giving written notice thereof to the
Borrower and the Agent) the Maturity Date shall be extended by
329 days (subject to the proviso in subsection (a)(i) above) from
and including the then current Maturity Date, with respect to the
Commitments of the Lenders consenting to such Extension Request.
(iii) If Lenders (each a "Nonconsenting Lender") hav-
ing Commitments equal to less than 33 1/3% of the Aggregate
Commitments (without giving effect to any Loans outstanding) do
not consent to an Extension Request during the Extension Consent
Period, the Borrower may elect to (A) withdraw such Extension
Request, (B) terminate the Commitment of each Nonconsenting
Lender effective on the then current Maturity Date (with the
Commitments of each other Consenting Lender continuing in full
force and effect) and, on such Maturity Date, pay to the Agent
for distribution to each such Nonconsenting Lender the out-
standing principal balance, if any, of the Notes of each such
Nonconsenting Lender, together with any accrued and unpaid inter-
est thereon to the date of such payment, any accrued and unpaid
Facility Fees due to such Lender, and any other amount due to
such Lender whereupon (1) effective on such then current Maturity
Date, such Maturity Date shall be extended for 329 days (subject
to the proviso in subsection (a)(i) above), and (2) each
Nonconsenting Lender shall cease to be a "Lender" for all pur-
poses of this Agreement (except with respect to its rights
hereunder to be reimbursed for costs and expenses in connection
with, and to indemnification with respect to, matters at-
tributable to events, acts or conditions occurring prior to such
payment) and shall no longer have any obligations hereunder, (C)
request one or more of the Consenting Lenders (each, a
"Replacement Lender") to elect to increase its Commitment by an
amount up to the amount of the Commitment of such Nonconsenting
Lenders, or (D) designate another bank or banks (any such bank,
also a "Replacement Lender") acceptable to the Agent and willing
to assume the Commitments of any such Nonconsenting Lender or
Lenders. Upon the Commitment of a Nonconsenting Lender being as-
sumed by a Replacement Lender under clauses (C) or (D) above,
effective on the then current Maturity Date or such earlier date
as shall be determined by the Borrower and the Agent, each such
Replacement Lender shall assume the Commitment of each such
Nonconsenting Lender by executing and delivering an Assignment
and Acceptance Agreement and, if such Nonconsenting Lender is the
holder of Notes, by purchasing such Notes of such Nonconsenting
Lender, which shall sell the same without recourse or warranty
(except as to the amount due thereon, its title to such Notes and
its right to sell the same) to such Replacement Lender at a price
in immediately available funds equal to the amount payable under
clause (B) above, whereupon (x) effective on the then current
Maturity Date, such Maturity Date shall be extended by 329 days
(subject to the proviso in subsection (a)(i) above) from and
including the then current Maturity Date, (y) each Replacement
Lender, if applicable, shall be deemed to be a "Lender" for all
purposes of this Agreement, and (z) each Nonconsenting Lender
shall cease to be a "Lender" for all purposes of this Agreement
(except with respect to its rights hereunder to be reimbursed for
costs and expenses in connection with, and to indemnification
with respect to, matters attributable to events, acts or
conditions occurring prior to such assumption and purchase) and
shall no longer have any obligations hereunder.
(iv) If Extension Consent Required Lenders do not
consent to an Extension Request during the Extension Consent
Period, the Maturity Date shall not be extended.
(v) Each Lender will use its best efforts to respond
during the Extension Consent Period to any Extension Request,
provided that no Lender's failure to so respond shall create any
claim against it or have the effect of extending the Maturity
Date or such Lender's Commitment beyond the Maturity Date.
(b) In the event the Borrower elects to terminate the
Commitment of a Nonconsenting Lender under Section
2.18(a)(iii)(B) above, the Agent is authorized to amend Exhibit
A, effective on the then current Maturity Date, and promptly
distribute a copy thereof to the Borrower and the remaining
Lenders (the "Consenting Lenders") reflecting the names of all
Consenting Lenders and Replacement Lenders and the new Commitment
Percentage of each such Consenting Lender and Replacement Lender
(after giving effect to the termination of each Nonconsenting
Lender's Commitment and the assumption by any Replacement Lender
of such Commitment).
(c) Notwithstanding anything to the contrary set forth
herein, in the event that at the time of an Extension Request,
the Facility B Credit Agreement is then in effect and the
Borrower has requested an extension of the Facility B Maturity
Date pursuant thereto, then (i) each Consenting Lender must
consent to an extension of both this Agreement and the Facility B
Credit Agreement, (ii) each Nonconsenting Lender whose Commitment
is terminated shall also have its Facility B Commitment
terminated and (iii) each Replacement Lender which assumes all or
a portion of the Commitment of a Nonconsenting Lender shall
assume all or a like portion of such Nonconsenting Lender's
Facility B Commitment, it being the intention of the parties that
at all times during which this Agreement and the Facility B
Credit Agreement are both in effect, each Lender shall also be a
Facility B Lender and its Commitment Percentage shall equal its
Facility B Commitment Percentage.
2.18. Change in Control
(a) The Borrower will notify the Agent and the Lenders in
writing within one Business Day after the occurrence of a Change
in Control. Upon receipt of such notice, each Lender shall have
the right to terminate its Commitment and Facility B Commitment
within five Business Days of the receipt of such notice. If a
Lender so elects to terminate its Commitment and Facility B
Commitment, the Borrower shall, not later than five Business Days
after such Lender has given such notice, repay such Lender's
Loans and Facility B Loans together with any accrued interest and
fees and other amounts due such Lender under the Loan Documents
and the Facility B Loan Documents.
(b) Notwithstanding the foregoing, in lieu of terminating
the Commitments and Facility B Commitments of the Lenders and
Facility B Lenders as provided in subsection (a) hereof, the
Borrower may request one or more of the Lenders not terminating
its Commitment and Facility B Commitment (also, a "Replacement
Lender") to elect to increase its Commitment and Facility B
Commitment by an amount up to the amount of the Commitment and
Facility B Commitment of such terminating Lender, or may
designate another bank or banks (any such bank, also a
"Replacement Lender") reasonably acceptable to the Agent and
willing to assume the Commitments and Facility B Commitments of
any such terminating Lender or Lenders. Upon the Commitment and
Facility B Commitment of a terminating Lender being assumed by a
Replacement Lender, each such Replacement Lender shall assume the
Commitment and Facility B Commitment of each such terminating
Lender by executing and delivering an Assignment and Acceptance
Agreement and, if such terminating Lender is the holder of Notes
or Facility B Notes, by purchasing such Notes or Facility B
Notes, as the case may be, of such terminating Lender, which
shall sell the same without recourse or warranty (except as to
the amount due thereon, its title to such Notes or Facility B
Notes, as the case may be, and its right to sell the same) to
such Replacement Lender at a price in immediately available funds
equal to the outstanding principal balance, if any, of the Notes
and Facility B notes, as the case may be, of each such
terminating Lender, together with any accrued and unpaid interest
thereon to the date of such payment, any accrued and unpaid fees
due to such Lender hereunder and under the Facility B Loan
Documents, whereupon each Replacement Lender shall be deemed to
be a "Lender" for all purposes of this Agreement, and (z) each
terminating Lender shall cease to be a "Lender" for all purposes
of this Agreement (except with respect to its rights hereunder
and under the Facility B Loan Documents to be reimbursed for
costs and expenses in connection with, and to indemnification
with respect to, matters attributable to events, acts or
conditions occurring prior to such assumption and purchase) and
shall no longer have any obligations hereunder.
2.19. Agent's Records
The Agent's records regarding the amount of each Loan,
each payment by the Borrower of principal and interest on the
Loans and other information relating to the Loans shall be
presumptively correct absent manifest error.
3. FEES; PAYMENTS
3.1. Facility Fee
The Borrower agrees to pay to the Agent, for the account
of the Lenders in accordance with each Lender's Commitment
Percentage, during the period from and including the Effective
Date through but excluding the Maturity Date, a fee (the
"Facility Fee") equal to the Applicable Fee Percentage per annum
of the average daily sum of the Aggregate Commitments, regardless
of usage, during such period. The Facility Fee shall be payable
(i) quarterly in arrears on the last day of each March, June,
September and December during such period, (ii) on the date of
any reduction in the Aggregate Commitments (to the extent of such
reduction) and (iii) on the Maturity Date. The Facility Fee shall
be calculated on the basis of a 360-day year for the actual
number of days elapsed.
3.2. Agent's Fees
The Borrower agrees to pay to the Agent, for its own
account, such other fees as have been agreed to in writing by the
Borrower and the Agent.
3.3. Pro Rata Treatment and Application of Principal Payments
Each payment, including each prepayment, of principal and
interest on the Loans and of the Facility Fee shall be made by
the Borrower to the Agent at its office set forth in Section 11.2
in funds immediately available to the Agent at such office by
12:00 p.m. on the due date for such payment, and, promptly upon
receipt thereof by the Agent, shall be remitted by the Agent in
like funds as received, to the Lenders according to the
Commitment Percentage of each Lender, in the case of the Facility
Fee and pro rata according to the aggregate outstanding principal
balance of the Loans, in the case of principal and interest due
thereon. The failure of the Borrower to make any such payment by
such time shall not constitute a default hereunder, provided that
such payment is made on such due date, but any such payment made
after 12:00 p.m. on such due date shall be deemed to have been
made on the next Business Day for the purpose of calculating
interest on amounts outstanding on the Loans. If any payment
hereunder or under the Notes shall be due and payable on a day
which is not a Business Day, the due date thereof (except as
otherwise provided in the definition of Interest Period) shall be
extended to the next Business Day and (except with respect to
payments in respect of the Facility Fee) interest shall be
payable at the applicable rate specified herein during such
extension. If any payment is made with respect to any Eurodollar
Advance prior to the last day of the applicable Interest Period,
the Borrower shall indemnify each Lender in accordance with
Section 2.13.
4. REPRESENTATIONS AND WARRANTIES
In order to induce the Agent and the Lenders to enter into this
Agreement and to make the Loans, the Borrower makes the following
representations and warranties to the Agent and each Lender:
4.1. Subsidiaries
On the Effective Date, the Borrower has only the
Subsidiaries set forth on Schedule 4.1. The shares of each
Subsidiary are duly authorized, validly issued, fully paid and
nonassessable and are owned free and clear of any Liens.
4.2. Existence and Power
Each of the Borrower and its Subsidiaries is duly
organized or formed and validly existing in good standing under
the laws of the jurisdiction of its incorporation or formation,
has all requisite power and authority to own its Property and to
carry on its business as now conducted, and is in good standing
and authorized to do business as a foreign corporation in each
jurisdiction in which the nature of the business conducted
therein or the Property owned therein makes such qualification
necessary, except where such failure to qualify, singly or in the
aggregate, could not reasonably be expected to have a Material
Adverse Effect.
4.3. Authority; Enforceability
The Borrower has full legal power and authority and has
taken all necessary actions, including, without limitation, any
necessary stockholder action, to enter into, execute, deliver and
perform the terms of the Loan Documents and to make the
borrowings contemplated hereby and by the Notes and to incur the
obligations provided for herein and therein, all of which have
are in full compliance with its articles of incorporation and by-
laws or its other organization documents. The Loan Documents
(other than the Notes) constitute, and the Notes, when issued and
delivered pursuant hereto for value received, will constitute,
the valid and legally binding obligations of the Borrower,
enforceable in accordance with their respective terms, except as
such enforceability may be limited by applicable bankruptcy,
insolvency, reorganization or other similar laws affecting the
enforcement of creditors' rights generally.
4.4. Required Consents
Except for information filings required to be made in the
ordinary course of business which are not a condition to the
Borrower's performance under the Loan Documents, no consent,
authorization or approval of, filing with, notice to, or
exemption by, stockholders, any Governmental Authority or any
other Person is required to authorize, or is required in
connection with the execution, delivery and performance by the
Borrower of the Loan Documents or is required as a condition to
the validity or enforceability of the Loan Documents against the
Borrower.
4.5. No Conflicting Agreements, Compliance with Laws; Taxes
On the initial Borrowing Date, (i) neither the Borrower
nor any of its Subsidiaries will be in default, (A) under any
mortgage, indenture, contract or agreement to which it is a party
or by which it or any of its Property is bound or (B) with
respect to any judgment, order, writ, injunction, decree or
decision of any Governmental Authority, the effect of which
default could reasonably be expected to have a Material Adverse
Effect, and (ii) the execution, delivery or carrying out of the
terms of the Loan Documents will not constitute a default under,
or require the mandatory repayment of, or result in the creation
or imposition of, or obligation to create, any Lien upon any
Property of the Borrower or any of its Subsidiaries pursuant to
the terms of, any such mortgage, indenture, contract or
agreement.
4.6. Franchises, Licenses, Etc.
Each of the Borrower and ACE possesses or has the right to
use all franchises, licenses, privileges and other rights that
are material and necessary for the conduct of its business, and
with respect to which it is in compliance, with no known conflict
with the valid rights of others which could reasonably be
expected to have a Material Adverse Effect.
4.7. Investment Company Act
The Borrower is not an "investment company" or a company
"controlled" by an "investment company" as defined in, or is
otherwise subject to regulation under, the Investment Company Act
of 1940, as amended.
4.8. Public Utility Status
The Borrower and each of its Subsidiaries are exempt from
the provisions of the Public Utility Holding Company Act of 1935,
as amended, except Section 9(a)(2) thereof, pursuant to Rule 2 of
the General Rules and Regulations of the SEC under said Act.
4.9. Federal Reserve Regulations; Use of Loan Proceeds
Neither the Borrower nor any of its Subsidiaries is
engaged principally, or as one of its important activities, in
the business of extending credit for the purpose of purchasing or
carrying any Margin Stock. No part of the proceeds of the Loans
will be used, directly or indirectly, for a purpose which
violates any law, rule or regulation of any Governmental
Authority, including, without limitation, the provisions of
Regulations G, T, U or X of the Board of Governors of the Federal
Reserve System, as amended. No part of the proceeds of the Loans
will be used, directly or indirectly, to purchase or carry Margin
Stock or to extend credit to others for the purpose of purchasing
or carrying Margin Stock.
4.10. Litigation
Except as set forth in the Financial Statements or as
disclosed after the date of the Financial Statements in the most
recent annual report filed by the Borrower with the SEC pursuant
to Section 13 or 15(d) of the Exchange Act, or in a quarterly or
periodic report filed with the SEC pursuant to Section 13 or
15(d) of the Exchange Act with respect to a period or date
subsequent to the end of the fiscal year covered by such annual
report, there are no actions, suits or proceedings at law or in
equity or by or before any Governmental Authority (whether
purportedly on behalf of the Borrower or any of its Subsidiaries)
pending or, to the knowledge of the Borrower, threatened against
the Borrower or any of its Subsidiaries or any of their
respective Properties or rights, which (i) reasonably may be
expected to have a Material Adverse Effect or (ii) call into
question the validity or enforceability of any of the Loan
Documents.
4.11. Financial Statements
The Borrower has heretofore delivered to the Agent and the
Lenders copies of its Form 10-K for the fiscal year ending
December 31, 1994, containing the audited Consolidated Balance
Sheets of the Borrower and its Subsidiaries and the related
Consolidated Statements of Operations, Stockholder's Equity and
Cash Flows for the period then ended, and its Form 10-Q for the
fiscal quarter ended March 31, 1995, containing the unaudited
Consolidated Balance Sheet of the Borrower and its Subsidiaries
for such fiscal quarter, together with the related Consolidated
Statements of Operations and Cash Flows for the fiscal quarter
then ended (with the applicable related notes and schedules, the
"Financial Statements"). The Financial Statements have been
prepared in accordance with GAAP and fairly present the
Consolidated financial condition and results of the operations of
the Borrower and its Subsidiaries as of the dates and for the
periods indicated therein. Except as reflected in the Financial
Statements or in the notes thereto, neither the Borrower nor any
of its Subsidiaries has any obligation or liability of any kind
(whether fixed, accrued, Contingent, unmatured or otherwise)
which, in accordance with GAAP, should have been shown on the
Financial Statements and was not. Since December 31, 1994, there
has been no Material Adverse Change.
4.12. Plans
The only Pension Plans in effect as of the Effective Date
(the "Existing Pension Plans") are listed on Schedule 4.12. Each
Employee Benefit Plan of the Borrower, its Subsidiaries and their
respective ERISA Affiliates is in compliance with ERISA and the
Code, where applicable, in all material respects and there is no
event or condition existing or anticipated under or with respect
to any Existing Pension Plan that could have a Material Adverse
Effect.
4.13. Ownership of Property; Liens
The Borrower has good and marketable title to, or a valid
leasehold interest in, all of its Property, subject to no Liens,
except Permitted Liens, and each Subsidiary has good and
marketable title to, or a valid leasehold interest in, all of its
Property, except to the extent that the failure to have such
title or leasehold interest could not reasonably be expected to
have a Material Adverse Effect.
4.14. Security Interests
The Pledge Agreement is effective to create in favor of
the Agent, for (i) the benefit of the Agent and the Facility B
Agent and for the ratable benefit of the Lenders and the Facility
B Lenders, a legal, valid and enforceable security interest in
the Collateral, and, on and after the taking of possession of the
Intercompany Notes by the Agent as collateral agent, and assuming
the continued possession thereof by the Agent as collateral
agent, the security interest granted by the Pledge Agreement
shall at all times constitute a fully perfected Lien on, and
security interest in, all right, title and interest of the
Borrower in such Collateral, in each case prior and superior in
right to any other Person.
4.15. Environmental Matters
Except as disclosed in the most recent report filed by the
Borrower with the SEC pursuant to Section 13 or 15(d) of the
Exchange Act, or in a quarterly or periodic report filed with the
SEC pursuant to Section 13 or 15(d) of the Exchange Act with
respect to a period or date subsequent to the end of the fiscal
year covered by such annual report, (i) the Borrower and each of
its Subsidiaries is in compliance with the requirements of all
applicable Environmental Laws, noncompliance with which
reasonably may be expected to have a Material Adverse Effect,
(ii) there have been no releases or disposals of hazardous
wastes, hazardous substances or other substances in quantities or
locations which might result in the Borrower or any of its
Subsidiaries incurring any remedial obligations under applicable
law which could, either singly or in the aggregate, reasonably be
expected to have Material Adverse Effect, and (iii) neither the
Borrower nor any of its Subsidiaries has received notice or order
advising it that it has or may have any remedial obligation with
respect to any such releases or disposals or that it is or may be
responsible for the costs of any remedial action taken or to be
taken by any other Persons with respect to any such releases or
disposals, which obligation or cost, if fully payable could,
either singly or in the aggregate, reasonably may be expected to
have Material Adverse Effect.
4.16. Certain Business Activities
The Borrower does not engage in any business other than
the holding of Permitted Investments.
5. CONDITIONS TO FIRST LOANS
In addition to the conditions precedent set forth in
Section 6, the obligation of each Lender to make its first
Revolving Credit Loan, or of any Lender to make the first
Competitive Bid Loan, on the first Borrowing Date shall be
subject to the fulfillment of the following conditions precedent:
5.1. Evidence of Action
The Agent shall have received a certificate, dated the
Effective Date, of the Secretary or Assistant Secretary of the
Borrower (i) attaching a true and complete copy of the
resolutions of its Board of Directors and of all documents
evidencing other necessary corporate action (in form and
substance satisfactory to the Agent) taken by it to authorize the
Loan Documents and the transactions contemplated thereby, (ii)
attaching a true and complete copy of its articles of
incorporation and by-laws, (iii) setting forth the incumbency of
its officer or officers who may sign the Loan Documents,
including therein a signature specimen of such officer or
officers and (iv) attaching a certificate of good standing of the
Secretary of State of the jurisdiction of its incorporation and
of each other jurisdiction in which it is qualified to do
business.
5.2. This Agreement; Notes
The Agent shall have received (i) counterparts of this
Agreement signed by each of the parties hereto (or receipt by the
Agent from a party hereto of a fax signature page signed by such
party which shall have agreed to promptly provide the Agent with
originally executed counterparts hereof) and (ii) for each
Lender, a Revolving Credit Note and a Competitive Bid Note, duly
executed by an Authorized Signatory of the Borrower.
5.3. Certificate as to Approvals and Liens
The Agent shall have received a certificate of an
Authorized Signatory of the Borrower certifying that (i) all
approvals and consents of all Persons required to be obtained in
connection with the consummation of the transactions contemplated
by the Loan Documents and the Facility B Loan Documents have been
duly obtained and are in full force and effect, and that all
required notices have been given and all required waiting periods
have expired and (ii) upon the making of the first Loans under
the Agreement and under the Facility B Loan Documents there will
exist no Liens on the Collateral other than Liens in favor of the
Facility B Agent, the Facility B Lenders, the Agent and the
Lenders under the Pledge Agreement.
5.4. Pledge Agreement
The Agent shall have received the Pledge Agreement, duly
executed by an Authorized Signatory of the Borrower, together
with Intercompany Notes duly executed by each Operating
Subsidiary, duly indorsed by the Borrower to the order of the
Agent, as collateral agent for itself, the Lenders, the Facility
B Agent and the Facility B Lenders.
5.5. Facility B Loan Documents
Each of the Facility B Credit Agreement and the Facility B
Notes shall have been duly executed and delivered by the parties
thereto.
5.6. Other Credit Facilities
(a) The Revolving Credit Commitment under the ATE Credit
Agreement shall have been permanently reduced to an amount not in
excess of $25,000,000, and the Agent shall have received
satisfactory evidence thereof; and
(b) The Borrower shall have paid, or made arrangements
satisfactory to the Agent to pay on the Borrowing Date, with the
proceeds of a Loan under this Agreement, a borrowing under the
Facility B Credit Agreement, or both, all principal and accrued
interest due to BNY under the Borrower's $20,000,000 unsecured
line of credit with BNY.
5.7. ACE Preferred Stock
The Agent shall have received a copy of the relevant
portions of the charter of ACE, and of each certificate of
designation filed pursuant to such charter, setting forth the
terms applicable to each class and series of the ACE Preferred
Stock outstanding on the Effective Date, certified by an
Authorized Signatory of the Borrower to be a true and complete
copy thereof, and such terms shall be satisfactory to the Agent.
5.8. Opinions of Counsel
The Agent shall have received (i) an opinion of Ballard
Spahr Andrews & Ingersoll, counsel to the Borrower, and (ii) an
opinion of James E. Franklin II, Esq., general counsel of the
Borrower, in each case addressed to the Facility B Agent, the
Facility B Lenders, the Agent, the Lenders and Special Counsel
and dated the Effective Date, covering the matters set forth in
Exhibit N and satisfactory in form and substance to the Agent.
5.9. Opinion of Special Counsel
The Agent shall have received an opinion of Special
Counsel, addressed to the Facility B Agent, the Facility B
Lenders, the Agent, the Lenders and Special Counsel,
substantially in the form of Exhibit O.
5.10. Fees
All fees payable to the Agent on the first Borrowing Date,
and the fees and expenses of Special Counsel incurred and
recorded to date in connection with the preparation, negotiation
and closing of the Loan Documents, shall have been paid.
6. CONDITIONS OF LENDING - ALL LOANS
The obligation of each Lender to make any Loan is subject to
the satisfaction of the following conditions precedent as of the
date of such Loan:
6.1. Compliance
On each Borrowing Date and after giving effect to the
Loans to be made thereon, (i) the Borrower shall have complied
with all of the terms, covenants and conditions of this Agreement
relating to such Loans, (ii) there shall exist no Event of
Default, (iii) the representations and warranties contained in
the Loan Documents shall be true and correct with the same effect
as though such representations and warranties had been made on
such Borrowing Date except to the extent such representations and
warranties specifically relate to an earlier date, in which case
such representations and warranties shall have been true and
correct in all material respects on and as of such earlier date,
and (iv) the Aggregate Credit Exposure will not exceed the
Aggregate Commitments. Each borrowing by the Borrower shall
constitute a certification by the Borrower as of such Borrowing
Date that each of the foregoing matters is true and correct in
all respects.
6.2. Borrowing Request; Competitive Bid Request
In the case of the borrowing of Revolving Credit Loans,
the Agent shall have received a Borrowing Request, and in the
case of a borrowing of a Competitive Bid Loan, the Agent shall
have received a Competitive Bid Request and such other documents
required to be delivered by the Borrower pursuant to Section 2.4,
in each case duly executed by an Authorized Signatory of the
Borrower.
7. AFFIRMATIVE COVENANTS
The Borrower agrees that, so long as this Agreement is in
effect, any Loan remains outstanding and unpaid, or any other
amount is owing under any Loan Document to any Lender or the
Agent, the Borrower shall:
7.1. Financial Statements
Maintain a standard system of accounting in accordance
with GAAP, and furnish or cause to be furnished to the Agent and
each Lender:
(a) As soon as available, but in any event not later
than 5 days after the due date thereof, or if an extension of
time to file has been obtained by the Borrower pursuant to Rule
12b-25 under the Exchange Act, not later than 5 days after the
expiration of such extension, (i) a complete copy of the
Borrower's Annual Report on Form 10-K in respect of each fiscal
year as filed by the Borrower with the SEC, together with a
copy all financial statements and financial statement schedules
incorporated therein by reference, and (ii) a complete copy of
the Borrower's Quarterly Report on Form 10-Q in respect of each
fiscal quarter as filed by the Borrower with the SEC, together
with a copy of any financial statements incorporated therein by
reference.
(b) Within 45 days after the end of each of the
first three fiscal quarters (90 days after the end of the last
fiscal quarter), a Compliance Certificate, duly executed by the
chief financial officer of the Borrower (or such other officer
as may be reasonably acceptable to the Agent).
(c) Such other information as the Agent or any
Lender may reasonably request from time to time.
7.2. Certificates; Other Information
Furnish to the Agent and each Lender:
(a) Prompt written notice if any Default or Event of
Default shall have occurred and be continuing;
(b) Promptly upon becoming available, copies of
all (i) annual reports to shareholders, proxy statements
and other materials (other than reports specified in
Section 7.1) which the Borrower or any of its Subsidiaries
may now or hereafter be required to file with or deliver
to any securities exchange or the SEC, or any other
Governmental Authority succeeding to the functions thereof
and (ii) material news releases and annual reports
relating to the Borrower or any of its Subsidiaries;
(c) Prompt written notice of any change by either
Moody's or S&P in the Senior Debt Rating;
(d) Prompt written notice of any agreement,
indenture or other document or instrument entered into by, or
which becomes binding upon, ACE which restricts or has the
effect of restricting the payment by ACE of dividends with
respect to its Stock;
(e) Prompt written notice of the forgiveness of any
Intercompany Note or the conversion thereof to Stock or other
instruments, in each case to the extent permitted by Section
8.6, together with a total of all such forgiveness or
conversions since the Effective Date; and
(f) Such other information as the Agent or any
Lender shall reasonably request from time to time.
7.3. Legal Existence
Maintain, and cause each of its Restricted Subsidiaries so
to maintain, its legal existence in good standing in the
jurisdiction of its incorporation or formation and in each other
jurisdiction in which the failure so to do could reasonably be
expected to have a Material Adverse Effect.
7.4. Taxes
Pay and discharge when due, and cause each of its
Restricted Subsidiaries so to do, all Taxes, assessments and
governmental charges, license fees and levies upon, or with
respect to the Borrower, such Restricted Subsidiary and all Taxes
upon the income, profits and Property of the Borrower and its
Restricted Subsidiaries which if unpaid, could reasonably be
expected to have a Material Adverse Effect or become a Lien on
the Property of the Borrower or such Restricted Subsidiary (other
than a Lien described in Section 8.2(i)), unless and to the
extent only that such Taxes, assessments, charges, license fees
and levies shall be contested in good faith and by appropriate
proceedings diligently conducted by the Borrower or such
Restricted Subsidiary and provided that any such contested Tax,
assessment, charge, license fee or levy shall not constitute, or
create, a Lien on any Property of the Borrower or such Restricted
Subsidiary senior to the Liens granted to the Agent and the
Lenders under the Pledge Agreement on such Property, and,
provided further, that the Borrower shall give the Agent prompt
notice of such contest and that such reserve or other appropriate
provision as shall be required by the Accountants in accordance
with GAAP shall have been made therefor.
7.5. Insurance
Maintain, and cause each of its Restricted Subsidiaries to
maintain insurance on all its Property in at least such amounts
and against at least such risks (but including in any event
public liability, product liability and business interruption
coverage) as is consistent with industry standards followed by
companies engaged in the same business; and furnish to the Agent,
upon written request, full information as to insurance policies
and reserves for self insurance.
7.6. Condition of Property
At all times, maintain, protect and keep in good repair,
working order and condition (ordinary wear and tear excepted),
and cause each of its Restricted Subsidiaries so to do, all
Property necessary to the operation of the Borrower's or such
Restricted Subsidiary's business.
7.7. Observance of Legal Requirements
Observe and comply, and cause each of its Restricted
Subsidiaries so to do, with all laws, ordinances, orders,
judgments, rules, regulations, certifications, franchises,
permits, licenses, directions and requirements of all
Governmental Authorities, which now or at any time hereafter may
be applicable to it, including, without limitation, ERISA and all
Environmental Laws, noncompliance with which could reasonably be
expected to have a Material Adverse Effect.
7.8. Inspection of Property; Books and Records; Discussions
Keep proper books of record and account in which full,
true and correct entries in conformity with GAAP and all
requirements of law shall be made of all dealings and
transactions in relation to its business and activities and
permit representatives of the Agent and any Lender to visit its
offices, to inspect any of its Property and examine and make
copies or abstracts from any of its books and records at any
reasonable time and as often as may reasonably be desired, and to
discuss the business, operations, prospects, licenses, Property
and financial condition of the Borrower and its Restricted
Subsidiaries with the officers thereof and the Accountants.
7.9. Licenses, Franchises, Intellectual Property, Etc.
Obtain or maintain, as applicable, and cause ACE to obtain
or maintain, as applicable, in full force and effect, all
licenses, franchises, Intellectual Property, permits,
authorizations and other rights as are necessary for the conduct
of its business and the failure of which to obtain or maintain
could reasonably be expected to have a Material Adverse Effect.
7.10. Indebtedness Capitalization Ratio
Maintain as of the last day of each fiscal quarter of the
Borrower, an Indebtedness Capitalization Ratio of less than or
equal to 0.65:1.00.
7.11. Ratio of Indebtedness to Annualized ACE Dividends
Maintain at all times, a ratio of (i) Indebtedness of the
Borrower to (ii) Annualized ACE Dividends of less than or equal
to 2.50:1.00.
8. NEGATIVE COVENANTS
The Borrower agrees that, so long as this Agreement is in
effect, any Loan remains outstanding and unpaid, or any other
amount is owing under any Loan Document to any Lender or the
Agent, the Borrower shall not:
8.1. Indebtedness
Create, incur, assume or suffer to exist any liability for
Indebtedness except (i) Indebtedness due under the Loan Documents
and the Facility B Loan Documents, (ii) Indebtedness of the
Borrower existing on the date hereof as set forth on Schedule
8.1, excluding increases and refinancings thereof, (iii) provided
that no Default or Event of Default would exist before and after
giving effect thereto, Contingent Obligations of the Borrower not
in excess of $70,000,000 in respect of Indebtedness for borrowed
money of Atlantic Thermal or any of its Subsidiaries in
connection with its District Heating and Cooling Project,
provided that any Contingent Obligation of the Borrower with
respect to such Indebtedness is unsecured and (iv) provided no
Default or Event of Default would exist before and after giving
effect thereto other Indebtedness and Contingent Obligations of
the Borrower in an aggregate amount not in excess of $10,000,000
provided that any such Indebtedness constituting a Contingent
Obligation shall be unsecured.
8.2. Liens
Create, incur, assume or suffer to exist any Lien upon any
of its Property, whether now owned or hereafter acquired except
(i) Liens for Taxes, assessments or similar charges incurred in
the ordinary course of business which are not delinquent or which
are being contested in accordance with Section 7.4, provided that
enforcement of such Liens is stayed pending such contest, (ii)
Liens in connection with workers' compensation, unemployment
insurance or other social security obligations (but not ERISA),
(iii) deposits or pledges to secure bids, tenders, contracts
(other than contracts for the payment of money), leases,
statutory obligations, surety and appeal bonds and other
obligations of like nature arising in the ordinary course of
business, (iv) zoning ordinances, easements, rights of way, minor
defects, irregularities, and other similar restrictions affecting
real Property which do not adversely affect the value of such
real Property or the financial condition of the Borrower or
impair its use for the operation of the business of the Borrower,
(v) Liens arising by operation of law such as mechanics',
materialmen's, carriers', warehousemen's liens incurred in the
ordinary course of business which are not delinquent or which are
being contested in good faith and by appropriate proceedings
diligently conducted by it, provided that enforcement of such
Liens is stayed pending such contest, (vi) Liens arising out of
judgments or decrees which are being contested in good faith and
by appropriate proceedings diligently conducted by it, provided
that enforcement of such Liens is stayed pending such contest,
(vii) Liens in favor of the Agent and the Lenders under the Loan
Documents and the Facility B Agent and the Facility B Lenders
under the Facility B Loan Documents, (viii) Liens on Property of
the Borrower existing on the Effective Date as set forth on
Schedule 8.2 as renewed from time to time, but not any increases
in the amounts secured thereby, (ix) Liens on Property of the
Borrower acquired after the Effective Date provided that such
Liens are limited to the Property so acquired and were not
created in contemplation of such acquisition and (x) Liens
securing Indebtedness for borrowed money (or Contingent
Obligations in connection therewith) of the Borrower provided
that the Agent, the Lenders, the Facility B Agent and the
Facility B Lenders are ratably secured pursuant to documentation
in form and substance satisfactory to the Agent and the Facility
B Agent.
8.3. Merger; Consolidation
(a) Consolidate with, be acquired by, or merge into or
with any Person, or permit any of its Restricted Subsidiaries so
to do, except that if no Default or Event of Default would exist
before and after giving effect thereto, (i) the Borrower or any
Restricted Subsidiary may merge with another entity provided that
the resulting corporation shall have a net worth not less than
the net worth of the Borrower or Restricted Subsidiary involved
in such merger, (ii) the entity to be merged with is in the same
business as a Restricted Subsidiary of the Borrower or in a
related business (including other types of utilities), (iii) in
the case of a merger involving the Borrower, the Borrower is the
survivor and (iv) in the case of a merger involving an Operating
Subsidiary, the survivor (if not such Operating Subsidiary) shall
assume the obligations of such Operating Subsidiary under the
Intercompany Note theretofore delivered by such Operating
Subsidiary to the Borrower by an instrument in form and substance
satisfactory to the Agent.
(b) Sell, lease or otherwise dispose of all or any part
of its Property, or enter into any sale-leaseback transaction
except:
(i) Sales or other dispositions of inventory in the
ordinary course of business;
(ii) Sales or other dispositions of equipment and
materials in the ordinary course of business which, in the
reasonable opinion of the Borrower, is obsolete or no longer
useful in the conduct of its business; and
(iii) Sales or other dispositions of other
Property for consideration not in excess of $25,000,000 per
sale or other disposition provided that no Default or Event of
Default shall exist immediately before or after giving effect
thereto.
8.4. Restricted Payments
Declare or pay any Restricted Payments payable in cash or
otherwise or apply any of its Property thereto or set apart any
sum therefor, or permit any of its Restricted Subsidiaries so to
do, except that (i) a Restricted Subsidiary may declare and pay
Restricted Payments to its parent or to the Borrower, (ii)
provided that no Default or Event of Default has occurred and is
then continuing or would occur giving effect thereto, (A) the
Borrower may (1) declare and pay cash dividends on its common
Stock in any fiscal year and (2) repurchase its Stock, and (B)
ACE may declare and pay cash dividends on, and make mandatory
and optional sinking fund payments with respect to, the ACE
Preferred Stock.
8.5. Investments, Acquisitions, Loans, Etc.
At any time, purchase or otherwise acquire, hold or invest
in the Stock of, or any other interest in, any Person, or make
any loan or advance to, or enter into any arrangement for the
purpose of providing funds or credit to, or make any other
investment, whether by way of capital contribution, time deposit
or otherwise, in or with any Person, or make any Acquisition (all
of which are sometimes referred to herein as "Investments")
except:
(a) Investments in (i) obligations issued or
guaranteed by the United States Government, (ii) obligations of
Federal agencies; (iii) State general obligation or revenue bonds
having a rating category not less than Aa or AA by Moody's or
S&P, respectively; (iv) State bond anticipation, tax anticipation
or revenue anticipation notes having a rating category not less
than MIG-2 or AA by Moody's or S&P, respectively; (v) any of the
following which, by their terms, mature within twelve months from
the date of issuance: (A) commercial paper rated not less than
Prime-1 or A-1 by Moody's or S&P, respectively; (B) bankers'
acceptance drawn on and accepted by Approved Financial
Institutions; (C) certificates of deposit issued by Approved
Financial Institutions and (D) money market mutual funds
investing in securities rated as "First Tier Eligible Securities"
by Moody's or S&P.
(b) Investments existing on the Effective Date as
set forth on Schedule 8.5.
(c) Investments consisting of Intercompany Loans to
Operating Subsidiaries, provided that (i) no Default or Event of
Default shall exist before and after giving effect thereto and
(ii) such Operating Subsidiary shall have executed and delivered
to the Borrower an Intercompany Note, which Intercompany Note
shall be in form and substance satisfactory to the Agent, shall
have been duly indorsed by the Borrower to the order of the
Agent, as collateral agent for itself, the Lenders, the Facility
B Agent and the Facility B Lenders and shall have been delivered
to the Agent, as such collateral agent.
(d) Investments consisting of loans to Permitted
Recipients, provided that (i) no Default or Event of Default
shall exist before and after giving effect thereto, and (ii) the
aggregate amount of all such Investments shall not exceed
$10,000,000.
(e) Acquisitions provided that (i) no Default or
Event of Default shall exist before and after giving effect
thereto, (ii) the Person or business to be acquired is in the
same or a related business to a Subsidiary of the Borrower
(including other types of utilities) or the assets or to be
acquired are devoted to or usable in such a business and (iii) no
more than $25,000,000 of proceeds of Loans are used therefor.
(f) Equity Investments in Operating Subsidiaries,
provided (i) that no Default or Event of Default would exist
before or after giving effect thereto and (ii) not more than
$20,000,000 of such Investments in the aggregate shall be made
with the proceeds of Loans or the forgiveness of Indebtedness or
the conversion to equity of any such Indebtedness, in each case
to the extent permitted by Section 8.6.
8.6. Amendments, Etc. of Intercompany Notes
Enter into or agree to any amendment, modification or
waiver of any term or condition of any Intercompany Note or
forgive all or any portion of any amount due thereunder or
convert all or any portion thereof into Stock or other interests
or instruments, provided, however, that if no Default or Event of
Default exists before and after giving effect thereto, the
Borrower may so convert or forgive such Intercompany Note or
Intercompany Notes not in excess of $20,000,000 in the aggregate,
provided further that any such conversion or forgiveness in
excess thereof may only be made if the Agent shall have received
30 days prior written notice thereof and the Operating Subsidiary
whose Intercompany Note is to be forgiven or converted shall have
executed and delivered to the Agent a guaranty substantially in
the form of Exhibit Q hereto, together with such legal opinions,
certificates and other documents as the Agent reasonably may
request, each in form and substance satisfactory to the Agent.
8.7. Designation of Operating Subsidiaries
Designate any Subsidiary as an additional Operating
Subsidiary to whom proceeds of Loans may be loaned by the
Borrower unless (i) no Default or Event of Default shall exist
before or after giving effect thereto, (ii) the prospective
Operating Subsidiary is a Subsidiary of the Borrower, (iii) the
prospective Operating Subsidiary is engaged in the conduct of an
active trade or business, (iv) the prospective Operating
Subsidiary executes an Intercompany Note, in favor of the
Borrower and in form and substance satisfactory to the Agent,
evidencing its obligation to repay Intercompany Loans made to it
by the Borrower from time to time, which Intercompany Note has
been duly indorsed by the Borrower to the order of the Agent, as
collateral agent for itself, the Lenders, the Facility B Agent
and the Facility B Lenders, and (v) the Agent shall have received
a written certificate signed by an Authorized Signatory of the
Borrower designating such Operating Subsidiary and certifying as
to its status as described in clauses (ii) and (iii) above.
8.8. Certain Business Activities
Engage in any business other than the holding of Permitted
Investments.
9. DEFAULT
9.1. Events of Default
The following shall each constitute an "Event of Default"
hereunder:
(a) The failure of the Borrower to pay any
installment of principal on any Note on the date when due and
payable; or
(b) The failure of the Borrower to pay any
installment of interest or any other fees or expenses payable
under any Loan Document or otherwise to the Agent with respect
to the loan facilities established hereunder within three
Business Days of the date when due and payable; or
(c) The use of the proceeds of any Loan in a manner
inconsistent with or in violation of Section 2.15; or
(d) The failure of the Borrower to observe or
perform any covenant or agreement contained in Sections 7.3,
7.10, 7.11 or Section 8; or
(e) The failure of the Borrower to observe or
perform any other term, covenant, or agreement contained in any
Loan Document and such failure shall have continued unremedied
for a period of 30 days after the Borrower shall have obtained
knowledge thereof; or
(f) Any representation or warranty made in any Loan
Document or in any certificate delivered or to be delivered
pursuant thereto shall prove to have been incorrect or misleading
(whether because of misstatement or omission) in any material
respect when made; or
(g) Obligations of the Borrower (other than its
obligations under the Notes), ACE or any of any Operating
Subsidiary, whether as principal, guarantor, surety or other
obligor, for the payment of any Indebtedness or operating leases
in excess of $10,000,000 in the aggregate (i) shall become or
shall be declared to be due and payable prior to the expressed
maturity thereof, or (ii) shall not be paid when due or within
any grace period for the payment thereof, or (iii) the holders of
any such obligations shall have the right to declare such
obligation due and payable prior to the expressed maturity
thereof;
(h) The Borrower, ACE or any Operating Subsidiary
shall (i) suspend or discontinue its business, (ii) make an
assignment for the benefit of creditors, (iii) generally not be
paying its debts as such debts become due, (iv) admit in writing
its inability to pay its debts as they become due, (v) file a
voluntary petition in bankruptcy, (vi) become insolvent (however
such insolvency shall be evidenced), (vii) file any petition or
answer seeking for itself any reorganization, arrangement,
composition, readjustment of debt, liquidation or dissolution or
similar relief under any present or future statute, law or
regulation of any jurisdiction, (viii) petition or apply to any
tribunal for any receiver, custodian or any trustee for any
substantial part of its Property, (ix) be the subject of any such
proceeding filed against it which remains undismissed for a
period of 60 days, (x) file any answer admitting or not
contesting the material allegations of any such petition filed
against it or any order, judgment or decree approving such
petition in any such proceeding, (xi) seek, approve, consent to,
or acquiesce in any such proceeding, or in the appointment of any
trustee, receiver, sequestrator, custodian, liquidator, or fiscal
agent for it, or any substantial part of its Property, or an
order is entered appointing any such trustee, receiver,
custodian, liquidator or fiscal agent and such order remains in
effect for 60 days, or (xii) take any formal action for the
purpose of effecting any of the foregoing or looking to the
liquidation or dissolution of the Borrower or such Subsidiary; or
(i) An order for relief is entered under the United
States bankruptcy laws or any other decree or order is entered by
a court having jurisdiction (i) adjudging the Borrower, ACE or
any Operating Subsidiary bankrupt or insolvent, (ii) approving
as properly filed a petition seeking reorganization, liquidation,
arrangement, adjustment or composition of or in respect of the
Borrower or any of its Subsidiaries under the United States
bankruptcy laws or any other applicable Federal or state law,
(iii) appointing a receiver, liquidator, assignee, trustee,
custodian, sequestrator (or other similar official) of the
Borrower or any of its Subsidiaries or of any substantial part of
the Property thereof, or (iv) ordering the winding up or
liquidation of the affairs of the Borrower or any of its
Subsidiaries, and any such decree or order continues unstayed and
in effect for a period of 60 days; or
(j) Judgments or decrees against the Borrower or any
of its Subsidiaries aggregating in excess of $10,000,000 shall
remain unpaid, unstayed on appeal, undischarged, unbonded or
undismissed for a period of 30 consecutive days from the entry
thereof; or
(k) Any Loan Document shall cease, for any reason,
to be in full force and effect or the Borrower shall so assert in
writing or shall disavow any of its obligations thereunder; or
(l) The occurrence of an Event of Default under and
as defined in the Pledge Agreement; or
(m) The occurrence of an Event of Default under and
as defined in any Facility B Loan Document; or
(n) The Borrower shall own less than 100% of the
issued and outstanding common Stock of ACE; or
(o) (i) any Termination Event shall occur; (ii) any
Accumulated Funding Deficiency, whether waived, shall exist with
respect to any Pension Plan; (iii) any Person shall engage in any
Prohibited Transaction involving any Employee Benefit Plan; (iv)
the Borrower, any of its Subsidiaries or any ERISA Affiliate
shall fail to pay when due an amount which is payable by it to
the PBGC or to a Pension Plan under Title IV of ERISA; or (v) any
other event or condition shall occur or exist with respect to an
Employee Benefit Plan; and the occurrence of any of such events
would have a Material Adverse Effect.
Upon the occurrence of an Event of Default or at any time
thereafter during the continuance thereof, (a) if such event is
an Event of Default specified in clause (h) or (i) above, the
Aggregate Commitments shall immediately and automatically
terminate and the Loans, all accrued and unpaid interest thereon,
and all other amounts owing under the Loan Documents shall
immediately become due and payable, and the Agent may, and, upon
the direction of the Required Lenders shall, exercise any and all
remedies and other rights provided in the Loan Documents, and (b)
if such event is any other Event of Default, any or all of the
following actions may be taken: (i) with the consent of the
Required Lenders, the Agent may, and upon the direction of the
Required Lenders shall, by notice to the Borrower, declare the
Aggregate Commitments to be terminated forthwith, whereupon the
Aggregate Commitments shall immediately terminate, and (ii) with
the consent of the Required Lenders, the Agent may, and upon the
direction of the Required Lenders shall, by notice of default to
the Borrower, declare the Loans, all accrued and unpaid interest
thereon, and all other amounts owing under the Loan Documents to
be due and payable forthwith, whereupon the same shall
immediately become due and payable, and the Agent may, and upon
the direction of the Required Lenders shall, exercise any and all
remedies and other rights provided pursuant to the Loan
Documents. Except as otherwise provided in this Section,
presentment, demand, protest and all other notices of any kind
are hereby expressly waived. The Borrower hereby further
expressly waives and covenants not to assert any appraisement,
valuation, stay, extension, redemption or similar laws, now or at
any time hereafter in force which might delay, prevent or
otherwise impede the performance or enforcement of any Loan
Document.
In the event that the Aggregate Commitments shall have
been terminated or the Notes shall have been declared due and
payable pursuant to the provisions of this Section, any funds
received by the Agent and the Lenders from or on behalf of the
Borrower shall be applied by the Agent and the Lenders in
liquidation of the Loans and the obligations of the Borrower
under the Loan Documents in the following manner and order, in
each case pro rata in proportion to the amounts due to each
Person entitled to payment: (i) first, to the payment of interest
on, and then the principal portion of, any Loans which the Agent
may have advanced on behalf of any Lender for which the Agent has
not then been reimbursed by such Lender or the Borrower; (ii)
second, to the payment of any fees or expenses due the Agent from
the Borrower, (iii) third, to reimburse the Agent and the Lenders
for any expenses (to the extent not paid pursuant to clause (ii)
above due from the Borrower pursuant to the provisions of Section
11.5; (iv) fourth, to the payment of accrued Facility Fees and
all other fees, expenses and amounts due under the Loan Documents
(other than principal and interest on the Notes); (v) fifth, to
the payment of interest due on the Notes; (vi) sixth, to the
payment of principal outstanding on the Revolving Credit Notes;
(vii) seventh, to the payment of principal outstanding on the
Competitive Bid Notes; and (viii) eighth, to the payment of any
other amounts owing to the Agent and the Lenders under any Loan
Document.
10. THE AGENT
10.1. Appointment
Each Lender hereby irrevocably designates and appoints BNY
as the Agent of such Lender under the Loan Documents and each
such Lender hereby irrevocably authorizes BNY, as the Agent for
such Lender, to take such action on its behalf under the
provisions of the Loan Documents and to exercise such powers and
perform such duties as are expressly delegated to the Agent by
the terms of the Loan Documents, together with such other powers
as are reasonably incidental thereto. Notwithstanding any
provision to the contrary elsewhere in any Loan Document, the
Agent shall not have any duties or responsibilities other than
those expressly set forth therein, or any fiduciary relationship
with any Lender, and no implied covenants, functions,
responsibilities, duties, obligations or liabilities shall be
read into the Loan Documents or otherwise exist against the
Agent.
10.2. Delegation of Duties
The Agent may execute any of its duties under the Loan
Documents by or through agents or attorneys-in-fact and shall be
entitled to rely upon the advice of counsel concerning all
matters pertaining to such duties.
10.3. Exculpatory Provisions
Neither the Agent nor any of its officers, directors,
employees, agents, attorneys-in-fact or affiliates shall be (i)
liable for any action lawfully taken or omitted to be taken by it
or such Person under or in connection with the Loan Documents
(except the Agent for its own gross negligence or willful
misconduct), or (ii) responsible in any manner to any of the
Lenders for any recitals, statements, representations or
warranties made by the Borrower or any officer thereof contained
in the Loan Documents or in any certificate, report, statement or
other document referred to or provided for in, or received by the
Agent under or in connection with, the Loan Documents or for the
value, validity, effectiveness, genuineness, perfection,
enforceability or sufficiency of any of the Loan Documents or for
any failure of the Borrower or any other Person to perform its
obligations thereunder. The Agent shall not be under any
obligation to any Lender to ascertain or to inquire as to the
observance or performance of any of the agreements contained in,
or conditions of, the Loan Documents, or to inspect the
properties, books or records of the Borrower. The Agent shall
not be under any liability or responsibility whatsoever, as
Agent, to the Borrower or any other Person as a consequence of
any failure or delay in performance, or any breach, by any Lender
of any of its obligations under any of the Loan Documents.
10.4. Reliance by Agent
The Agent shall be entitled to rely, and shall be fully
protected in relying, upon any writing, resolution, notice,
consent, certificate, affidavit, opinion, letter, cablegram,
telegram, fax, telex or teletype message, statement, order or
other document or conversation believed by it to be genuine and
correct and to have been signed, sent or made by the proper
Person or Persons and upon advice and statements of legal counsel
(including, without limitation, counsel to the Borrower),
independent accountants and other experts selected by the Agent.
The Agent may treat each Lender, or the Person designated in the
last notice filed with it under this Section, as the holder of
all of the interests of such Lender in its Loans and in its Notes
until written notice of transfer, signed by such Lender (or the
Person designated in the last notice filed with the Agent) and by
the Person designated in such written notice of transfer, in form
and substance satisfactory to the Agent, shall have been filed
with the Agent. The Agent shall not be under any duty to examine
or pass upon the validity, effectiveness, enforceability,
perfection or genuineness of the Loan Documents or any
instrument, document or communication furnished pursuant thereto
or in connection therewith, and the Agent shall be entitled to
assume that the same are valid, effective and genuine, have been
signed or sent by the proper parties and are what they purport to
be. The Agent shall be fully justified in failing or refusing to
take any action under the Loan Documents unless it shall first
receive such advice or concurrence of the Required Lenders as it
deems appropriate. The Agent shall in all cases be fully
protected in acting, or in refraining from acting, under the Loan
Documents in accordance with a request or direction of the
Required Lenders, and such request or direction and any action
taken or failure to act pursuant thereto shall be binding upon
all the Lenders and all future holders of the Notes.
10.5. Notice of Default
The Agent shall not be deemed to have knowledge or notice
of the occurrence of any Default or Event of Default unless the
Agent has received written notice thereof from a Lender or the
Borrower. In the event that the Agent receives such a notice,
the Agent shall promptly give notice thereof to the Lenders and
the Borrower. The Agent shall take such action with respect to
such Default or Event of Default as shall be directed by the
Required Lenders, provided, however, that unless and until the
Agent shall have received such directions, the Agent may (but
shall not be obligated to) take such action, or refrain from
taking such action, with respect to such Default or Event of
Default as it shall deem to be in the best interests of the
Lenders.
10.6. Non-Reliance on Agent and Other Lenders
Each Lender expressly acknowledges that neither the Agent
nor any of its respective officers, directors, employees, agents,
attorneys-in-fact or affiliates has made any representations or
warranties to it and that no act by the Agent hereinafter,
including any review of the affairs of the Borrower, shall be
deemed to constitute any representation or warranty by the Agent
to any Lender. Each Lender represents to the Agent that it has,
independently and without reliance upon the Agent or any other
Lender, and based on such documents and information as it has
deemed appropriate, made its own evaluation of and investigation
into the business, operations, Property, financial and other
condition and creditworthiness of the Borrower and made its own
decision to enter into this Agreement. Each Lender also
represents that it will, independently and without reliance upon
the 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 analyses, evaluations and decisions in taking
or not taking action under any Loan Document, and to make such
investigation as it deems necessary to inform itself as to the
business, operations, Property, financial and other condition and
creditworthiness of the Borrower. Except for notices, reports
and other documents expressly required to be furnished to the
Lenders by the Agent hereunder, the Agent shall not have any duty
or responsibility to provide any Lender with any credit or other
information concerning the business, operations, Property,
financial and other condition or creditworthiness of the Borrower
which may come into the possession of the Agent or any of its
officers, directors, employees, agents, attorneys-in-fact or
affiliates.
10.7. Indemnification
Each Lender agrees to indemnify and reimburse the Agent in
its capacity as such (to the extent not promptly reimbursed by
the Borrower and without limiting the obligation of the Borrower
to do so), pro rata according to the outstanding principal
balance of the Loans (or at any time when no Loans are
outstanding, according to its Commitment Percentage), from and
against any and all liabilities, obligations, losses, damages,
penalties, actions, judgments, suits, costs, expenses or
disbursements of any kind whatsoever including, without
limitation, any amounts paid to the Lenders (through the Agent)
by the Borrower pursuant to the terms of the Loan Documents, that
are subsequently rescinded or avoided, or must otherwise be
restored or returned) which may at any time (including, without
limitation, at any time following the payment of the Notes) be
imposed on, incurred by or asserted against the Agent in any way
relating to or arising out of the Loan Documents or any other
documents contemplated by or referred to therein or the
transactions contemplated thereby or any action taken or omitted
to be taken by the Agent under or in connection with any of the
foregoing; provided, however, that no Lender shall be liable for
the payment of any portion of such liabilities, obligations,
losses, damages, penalties, actions, judgments, suits, costs,
expenses or disbursements to the extent resulting solely from
the finally adjudicated gross negligence or willful misconduct of
the Agent. Without limitation of the foregoing, each Lender
agrees to reimburse the Agent promptly upon demand for its pro
rata share of any unpaid fees owing to the Agent, and any costs
and expenses (including, without limitation, reasonable fees and
expenses of counsel) payable by the Borrower under Section 11.5,
to the extent that the Agent has not been paid such fees or has
not be reimbursed for such costs and expenses by the Borrower.
The failure of any Lender to reimburse the Agent promptly upon
demand for its pro rata share of any amount required to be by the
Lenders to the Agent as provided in this Section shall not
relieve any other Lender of its obligation hereunder to reimburse
the Agent for its pro rata share of such amount, but no Lender
shall be responsible for the failure of other Lender to reimburse
the Agent for such other Lender's pro rata share of such amount.
The agreements in this Section shall survive the payment of all
amounts payable under the Loan Documents.
10.8. Agent in Its Individual Capacity
BNY and its respective affiliates may make loans to,
accept deposits from, issue letters of credit for the account of,
and generally engage in any kind of business with, the Borrower
as though BNY were not Agent hereunder. With respect to the
Commitment made or renewed by BNY and the Notes issued to BNY,
BNY shall have the same rights and powers under the Loan
Documents as any Lender and may exercise the same as though it
were not the Agent, and the terms "Lender" and "Lenders" shall in
each case include BNY.
10.9. Successor Agent
If at any time the Agent deems it advisable, in its sole
discretion, it may submit to each of the Lenders a written notice
of its resignation as Agent under the Loan Documents, such
resignation to be effective upon the earlier of (i) the written
acceptance of the duties of the Agent under the Loan Documents by
a successor Agent and (ii) on the 30th day after the date of such
notice. Upon any such resignation, the Required Lenders shall
have the right, with the prior written consent of the Borrower
(which consent shall not be unreasonably withheld or delayed and
which consent of the Borrower shall not be required upon the
occurrence and during the continuance of a Default or an Event of
Default), to appoint from among the Lenders a successor Agent.
If no successor Agent shall have been so appointed by the
Required Lenders and accepted such appointment in writing within
30 days after the retiring Agent's giving of notice of
resignation, then the retiring Agent may, on behalf of the
Lenders, appoint a successor Agent, which successor Agent shall
be a commercial bank organized under the laws of the United
States of America or any State thereof and having a combined
capital, surplus, and undivided profits of at least $100,000,000.
Upon the acceptance of any appointment as Agent hereunder by a
successor Agent, such successor Agent shall thereupon succeed to
and become vested with all the rights, powers, privileges and
duties of the retiring Agent, and the retiring Agent's rights,
powers, privileges and duties as Agent under the Loan Documents
shall be terminated. The Borrower and the Lenders shall execute
such documents as shall be necessary to effect such appointment.
After any retiring Agent's resignation as Agent, the provisions
of the Loan Documents shall inure to its benefit as to any
actions taken or omitted to be taken by it while it was Agent
under the Loan Documents. If at any time there shall not be a
duly appointed and acting Agent, the Borrower agrees to make
each payment due under the Loan Documents directly to the Lenders
entitled thereto during such time.
11. OTHER PROVISIONS
11.1. Amendments and Waivers
With the written consent of the Required Lenders, the
Agent and the Borrower may, from time to time, enter into written
amendments, supplements or modifications of the Loan Documents
and, with the consent of the Required Lenders, the Agent on
behalf of the Lenders may execute and deliver to any such parties
a written instrument waiving or a consent to a departure from, on
such terms and conditions as the Agent may specify in such
instrument, any of the requirements of the Loan Documents or any
Default or Event of Default and its consequences; provided,
however, that:
(a) no such amendment, supplement, modification, waiver
or consent shall, without the written consent of all of the
Lenders, (i) increase the Commitment of any Lender or the
Aggregate Commitments, (ii) extend the Maturity Date (except as
provided in Section 2.18); (iii) decrease the rate, or extend the
time of payment, of interest of, or change or forgive the
principal amount of, or change the pro rata allocation of
payments under, any Note; (iv) release all or any part of the
Collateral; (v) change the provisions of Sections 3.4, 11.1 or
11.7(a) or (vi) change the definition of Required Lenders;
(b) without the written consent of BNY, no such
amendment, supplement, modification or waiver shall amend, modify
or waive any provision of Section 10 or otherwise change any of
the rights or obligations of the Agent hereunder or under the
Loan Documents.
Any such amendment, supplement, modification or waiver
shall apply equally to each of the Lenders and shall be binding
upon the parties to the applicable Loan Document, the Lenders,
the Agent and all future holders of the Notes. In the case of
any waiver, the parties to the applicable Loan Document, the
Lenders and the Agent shall be restored to their former position
and rights hereunder and under the outstanding Notes and other
Loan Documents to the extent provided for in such waiver, and any
Default or Event of Default waived shall not extend to any
subsequent or other Default or Event of Default, or impair any
right consequent thereon. The Loan Documents may not be amended
orally or by any course of conduct.
11.2. Notices
All notices, requests and demands to or upon the
respective parties to the Loan Documents to be effective shall be
in writing and, unless otherwise expressly provided therein,
shall be deemed to have been duly given or made when delivered by
hand, or when deposited in the mail, first-class postage prepaid,
or, in the case of notice by fax, when sent, addressed as follows
in the case of the Borrower or the Agent, at the Domestic Lending
Office, in the case of each Lender, or to such other addresses as
to which the Agent may be hereafter notified by the respective
parties thereto or any future holders of the Notes:
The Borrower:
Atlantic Energy, Inc.
6801 Black Horse Pike
Pleasantville, New Jersey 08232-4130
Attention: Louis M. Walters,
Treasurer
Telephone: (609) 645-4441
Fax: (609) 645-4550
The Agent:
The Bank of New York
One Wall Street
Agency Function Administration
18th Floor
New York, New York 10286
Attention: Patricia Clancy
Telephone: (212) 635-4696
Fax: (212) 635-6365 or 6366 or 6367
with a copy to:
The Bank of New York
Energy Industries Division
One Wall Street
19th Floor
New York, New York 10286
Attention: Mary Lou Bradley,
Vice President
Telephone: (212) 635-7533
Fax: (212) 635-7923
except that any notice, request or demand by the Borrower to or
upon the Agent or the Lenders pursuant to Sections 2.3, 2.4 or
2.7 shall not be effective until received. Any party to a Loan
Document may rely on signatures of the parties thereto which are
transmitted by fax or other electronic means as fully as if
originally signed.
11.3. No Waiver; Cumulative Remedies
No failure to exercise and no delay in exercising, on the
part of the Agent or any Lender, any right, remedy, power or
privilege under any Loan Document shall operate as a waiver
thereof; nor shall any single or partial exercise of any right,
remedy, power or privilege under any Loan Document preclude any
other or further exercise thereof or the exercise of any other
right, remedy, power or privilege. The rights, remedies, powers
and privileges under the Loan Documents are cumulative and not
exclusive of any rights, remedies, powers and privileges provided
by law.
11.4. Survival of Representations and Warranties
All representations and warranties made under the Loan
Documents and in any document, certificate or statement delivered
pursuant thereto or in connection therewith shall survive the
execution and delivery of the Loan Documents.
11.5. Payment of Expenses and Taxes
The Borrower agrees, promptly upon presentation of a
statement or invoice therefor, and whether any Loan is made (i)
to pay or reimburse the Agent for all its out-of-pocket costs and
expenses reasonably incurred in connection with the development,
preparation, execution and syndication of, the Loan Documents and
any amendment, supplement or modification thereto (whether or not
executed), any documents prepared in connection therewith and the
consummation of the transactions contemplated thereby, including,
without limitation, the reasonable fees and disbursements of
Special Counsel, (ii) to pay or reimburse the Agent and the
Lenders for all of their respective costs and expenses,
including, without limitation, reasonable fees and disbursements
of counsel, incurred in connection with (A) any Default or Event
of Default and any enforcement or collection proceedings
resulting therefrom or in connection with the negotiation of any
restructuring or "work-out" (whether consummated or not) of the
obligations of the Borrower under any of the Loan Documents and
(B) the enforcement of this Section, (iii) to pay, indemnify, and
hold each Lender and the Agent harmless from and against, any and
all recording and filing fees and any and all liabilities with
respect to, or resulting from any delay in paying, stamp, excise
and other similar taxes, if any, which may be payable or
determined to be payable in connection with the execution and
delivery of, or consummation of any of the transactions
contemplated by, or any amendment, supplement or modification of,
or any waiver or consent under or in respect of, the Loan
Documents and any such other documents, and (iv) to pay,
indemnify and hold each Lender and the Agent and each of their
respective officers, directors and employees harmless from and
against any and all other liabilities, obligations, claims,
losses, damages, penalties, actions, judgments, suits, costs,
expenses or disbursements of any kind or nature whatsoever
(including, without limitation, reasonable counsel fees and
disbursements) with respect to the enforcement and performance of
the Loan Documents and the enforcement and performance of the
provisions of any subordination agreement in favor of the Agent
and the Lenders (all the foregoing, collectively, the
"indemnified liabilities") and, if and to the extent that the
foregoing indemnity may be unenforceable for any reason, the
Borrower agrees to make the maximum payment permitted or not
prohibited under applicable law; provided, however, that the
Borrower shall have no obligation hereunder to pay indemnified
liabilities to the Agent or any Lender arising from the finally
adjudicated gross negligence or willful misconduct of the Agent
or such Lender or claims between one indemnified party and
another indemnified party. The agreements in this Section shall
survive the termination of the Aggregate Commitments and the
payment of all amounts payable under the Loan Documents.
11.6. Lending Offices
Each Lender shall have the right at any time and from time
to time to transfer its Loans to a different office, provided
that such Lender shall promptly notify the Agent and the Borrower
of any such change of office. Such office shall thereupon become
such Lender's Domestic Lending Office or Eurodollar Lending
Office, as the case may be, provided, however, that no such
Lender shall be entitled to receive any greater amount under
Sections 2.10, 2.12 or 2.13 as a result of a transfer of any such
Loans to a different office of such Lender than it would be
entitled to immediately prior thereto unless such claim would
have arisen even if such transfer had not occurred.
11.7. Assignments and Participations
(a) The Loan Documents shall be binding upon and inure to
the benefit of the Borrower, the Lenders, the Agent, all future
holders of the Notes and their respective successors and assigns,
except that the Borrower may not assign, delegate or transfer any
of its rights or obligations under the Loan Documents without the
prior written consent of the Agent and each Lender.
(b) Each Lender shall have the right at any time, upon
written notice to the Agent of its intent to do so, to sell,
assign, transfer or negotiate all or any part of such Lender's
rights under the Loan Documents and the Facility B Loan Documents
to one or more of its affiliates, to one or more of the other
Lenders (or to affiliates of such other Lenders) or, with the
prior written consent of the Borrower and the Agent (which
consent shall not be unreasonably withheld or delayed and which
consent of the Borrower shall not be required upon the occurrence
and during the continuance of an Event of Default), to sell,
assign, transfer or negotiate all or any part of such Lender's
rights and obligations under the Loan Documents and the Facility
B Loan Documents to any other bank, insurance company, pension
fund, mutual fund or other financial institution, provided that
(i) each such sale, assignment, transfer or negotiation (other
than sales, assignments, transfers or negotiations (x) to
affiliates of such Lender or (y) of a Lender's entire interest)
shall be in a minimum amount of $5,000,000, (ii) each such sale,
assignment, transfer or negotiation shall be of an equal
percentage of such Lenders interest under the Loan Documents and
the Facility B Loan Documents (it being the intention of the
parties that at all times during which the Loan Documents and the
Facility B Loan Documents are both in effect, each Lender shall
also be a Facility B Lender and its Commitment Percentage shall
equal its Facility B Commitment Percentage) and (iii) there shall
be paid to the Agent by the assigning Lender a fee (the
"Assignment Fee") of $3,000 for the assignment of both the Loan
Documents and the Facility B Loan Documents. For each
assignment, the parties to such assignment shall execute and
deliver to the Agent for its acceptance and recording an
Assignment and Acceptance Agreement. Upon such execution,
delivery, acceptance and recording by the Agent, from and after
the effective date specified in such Assignment and Acceptance
Agreement, the assignee thereunder shall be a party hereto and,
to the extent provided in such Assignment and Acceptance
Agreement, the assignor Lender thereunder shall be released from
its obligations under the Loan Documents. The Borrower agrees
upon written request of the Agent and at the Borrower's expense
to execute and deliver (A) to such assignee, a Revolving Credit
Note, dated the effective date of such Assignment and Acceptance
Agreement, in an aggregate principal amount equal to the Loans
assigned to, and Commitments assumed by, such assignee, (B) to
such assignee, a Competitive Bid Note, dated the effective date
of such Assignment and Acceptance Agreement and (C) to such
assignee, a Revolving Credit Note, dated the effective date of
such Assignment and Acceptance Agreement, in an aggregate
principal amount equal to the balance of such assignor Lender's
Revolving Credit Loans and Commitments, if any, and each assignor
Lender shall cancel and return to the Borrower its existing
Revolving Credit Note. Upon any such sale, assignment or other
transfer, the Commitments and the Commitment Percentages set
forth in Exhibit A shall be adjusted accordingly by the Agent.
(c) Each Lender may grant participations in all or any
part of its Loans, its Notes and its Commitment to one or more
banks, insurance companies, financial institutions, pension funds
or mutual funds, provided that (i) such Lender's obligations
under the Loan Documents shall remain unchanged, (ii) such Lender
shall remain solely responsible to the other parties to the Loan
Documents for the performance of such obligations, (iii) the
Borrower, the 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 the Loan Documents, (iv) no
sub-participations shall be permitted and (v) the voting rights
of any holder of any participation shall be limited to decisions
that only do any of the following: (A) subject the participant to
any additional obligation, (B) reduce the principal of, or
interest on the Notes or any fees or other amounts payable
hereunder, (C) postpone any date fixed for the payment of
principal of, or interest on the Notes or any fees or other
amounts payable hereunder, (D) release any security interest or
Collateral except to the extent that such release is specifically
provided for in any Loan Document or (E) release any guarantor
under any guarantee. The Borrower acknowledges and agrees that
any such participant shall for purposes of Sections 2.10, 2.12,
2.13 and 2.16 be deemed to be a "Lender"; provided, however, the
Borrower shall not, at any time, be obligated to pay any
participant in any interest of any Lender hereunder any sum in
excess of the sum which the Borrower would have been obligated to
pay to such Lender in respect of such interest had such Lender
not sold such participation.
(d) If any (i) assignment is made pursuant to subsection
(b) above or (ii) any participation is granted pursuant to
subsection (c) above, shall be made to any Person that is not a
U.S. Person, such Person shall furnish such certificates,
documents or other evidence to the Borrower and the Agent, in the
case of clause (i) and to the Borrower and the Lender which sold
such participation in the case of clause (ii), as shall be
required by Section 2.10(e).
(e) No Lender shall, as between and among the Borrower,
the Agent and such Lender, be relieved of any of its obligations
under the Loan Documents as a result of any sale, assignment,
transfer or negotiation of, or granting of participations in, all
or any part of its Loans, its Commitment or its Note, except that
a Lender shall be relieved of its obligations to the extent of
any such sale, assignment, transfer, or negotiation of all or any
part of its Loans, its Commitment or its Notes pursuant to
subsection (b) above.
(f) Notwithstanding anything to the contrary contained in
this Section, any Lender may at any time or from time to time
assign all or any portion of its rights under the Loan Documents
to a Federal Reserve Bank, provided that any such assignment
shall not release such assignor from its obligations thereunder.
11.8. Counterparts
Each Loan Document (other than the Notes) may be executed
by one or more of the parties thereto on any number of separate
counterparts and all of said counterparts taken together shall be
deemed to constitute one and the same document. It shall not be
necessary in making proof of any Loan Document to produce or
account for more than one counterpart signed by the party to be
charged. A counterpart of any Loan Document or to any document
evidencing, and of any an amendment, modification, consent or
waiver to or of any Loan Document transmitted by fax shall be
deemed to be an originally executed counterpart. A set of the
copies of the Loan Documents signed by all the parties thereto
shall be deposited with each of the Borrower and the Agent. Any
party to a Loan Document may rely upon the signatures of any
other party thereto which are transmitted by fax or other
electronic means to the same extent as if originally signed.
11.9. Adjustments; Set-off
(a) If any Lender (a "Benefited Lender") shall at any
time receive any payment of all or any part of its Loans, or
interest thereon, or receive any collateral in respect thereof
(whether voluntarily or involuntarily, by set-off, pursuant to
events or proceedings of the nature referred to in Section 9.1
(h) or (i), or otherwise) in a greater proportion than any such
payment to and collateral received by any other Lender in respect
of such other Lender's Loans, or interest thereon, such Benefited
Lender shall purchase for cash from each of the other Lenders
such portion of each such other Lender's Loans, and shall provide
each of such other Lenders with the benefits of any such
collateral, or the proceeds thereof, as shall be necessary to
cause such Benefited Lender to share the excess payment or
benefits of such collateral or proceeds ratably with each of the
Lenders, provided, however, that if all or any portion of such
excess payment or benefits is thereafter recovered from such
Benefited Lender, such purchase shall be rescinded, and the
purchase price and benefits returned, to the extent of such
recovery, but without interest. The Borrower agrees that each
Lender so purchasing a portion of another Lender's Loans may
exercise all rights of payment (including, without limitation,
rights of set-off, to the extent not prohibited by law) with
respect to such portion as fully as if such Lender were the
direct holder of such portion.
(b) In addition to any rights and remedies of the Lenders
provided by law, upon the occurrence of an Event of Default and
the acceleration of the obligations owing in connection with the
Loan Documents, or at any time upon the occurrence and during the
continuance of an Event of Default, under Section 9.1(a) or (b),
each Lender shall have the right, without prior notice to the
Borrower, any such notice being expressly waived by the Borrower
to the extent not prohibited by applicable law, to set-off and
apply against any indebtedness, whether matured or unmatured, of
the Borrower to such Lender, any amount owing from such Lender to
the Borrower, at, or at any time after, the happening of any of
the above-mentioned events. To the extent not prohibited by
applicable law, the aforesaid right of set-off may be exercised
by such Lender against the Borrower or against any trustee in
bankruptcy, custodian, debtor in possession, assignee for the
benefit of creditors, receiver, or execution, judgment or
attachment creditor of the Borrower, or against anyone else
claiming through or against the Borrower or such trustee in
bankruptcy, custodian, debtor in possession, assignee for the
benefit of creditors, receiver, or execution, judgment or
attachment creditor, notwithstanding the fact that such right of
set-off shall not have been exercised by such Lender prior to the
making, filing or issuance, or service upon such Lender of, or of
notice of, any such petition, assignment for the benefit of
creditors, appointment or application for the appointment of a
receiver, or issuance of execution, subpoena, order or warrant.
Each Lender agrees promptly to notify the Borrower and the Agent
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.
11.10. Indemnity
The Borrower agrees to indemnify and hold harmless the
Agent and each Lender and their respective affiliates, directors,
officers, employees, attorneys and agents (each an "Indemnified
Person") from and against any loss, cost, liability, damage or
expense (including the reasonable fees and disbursements of
counsel of such Indemnified Person, including all local counsel
hired by any such counsel) incurred by such Indemnified Person in
investigating, preparing for, defending against, or providing
evidence, producing documents or taking any other action in
respect of, any commenced or threatened litigation,
administrative proceeding or investigation under any federal
securities law or any other statute of any jurisdiction, or any
regulation, or at common law or otherwise, which is alleged to
arise out of or is based upon (i) any untrue statement or alleged
untrue statement of any material fact by the Borrower in any
document or schedule executed or filed with any Governmental
Authority by or on behalf of the Borrower; (ii) any omission or
alleged omission to state any material fact required to be stated
in such document or schedule, or necessary to make the statements
made therein, in light of the circumstances under which made, not
misleading; (iii) any acts, practices or omissions or alleged
acts, practices or omissions of the Borrower or its agents
relating to the use of the proceeds of any or all borrowings made
by the Borrower which are alleged to be in violation of Section
2.15, or in violation of any federal securities law or of any
other statute, regulation or other law of any jurisdiction
applicable thereto; or (iv) any acquisition or proposed
acquisition by the Borrower of all or a portion of the Stock, or
all or a portion of the assets, of any Person whether such
Indemnified Person is a party thereto. The indemnity set forth
herein shall be in addition to any other obligations or
liabilities of the Borrower to each Indemnified Person under the
Loan Documents or at common law or otherwise, and shall survive
any termination of the Loan Documents, the expiration of the
Aggregate Commitments and the payment of all indebtedness of the
Borrower under the Loan Documents, provided that the Borrower
shall have no obligation under this Section to an Indemnified
Person with respect to any of the foregoing to the extent found
in a final judgment of a court having jurisdiction to have
resulted primarily out of the gross negligence or wilful
misconduct of such Indemnified Person or arising solely from
claims between one such Indemnified Person and another such
Indemnified Person.
11.11. Governing Law
The Loan Documents and the rights and obligations of the
parties thereunder shall be governed by, and construed and
interpreted in accordance with, the internal laws of the State of
New York, without regard to principles of conflict of laws.
11.12. Headings Descriptive
Section headings have been inserted in the Loan Documents
for convenience only and shall not be construed to be a part
thereof.
11.13. Severability
Every provision of the Loan Documents is intended to be
severable, and if any term or provision thereof shall be invalid,
illegal or unenforceable for any reason, the validity, legality
and enforceability of the remaining provisions thereof shall not
be affected or impaired thereby, and any invalidity, illegality
or unenforceability in any jurisdiction shall not affect the
validity, legality or enforceability of any such term or
provision in any other jurisdiction.
11.14. Integration
All exhibits to a Loan Document shall be deemed to be a
part thereof. Except for agreements between the Agent and the
Borrower with respect to certain fees, the Loan Documents embody
the entire agreement and understanding among the Borrower, the
Agent and the Lenders with respect to the subject matter thereof
and supersede all prior agreements and understandings among the
Borrower, the Agent and the Lenders with respect to the subject
matter thereof.
11.15. Consent to Jurisdiction
The Borrower hereby irrevocably submits to the
jurisdiction of any New York State or Federal court sitting in
the City of New York over any suit, action or proceeding arising
out of or relating to the Loan Documents. The Borrower hereby
irrevocably waives, to the fullest extent permitted or not
prohibited by law, any objection which it may now or hereafter
have to the laying of the venue of any such suit, action or
proceeding brought in such a court and any claim that any such
suit, action or proceeding brought in such a court has been
brought in an inconvenient forum. The Borrower hereby agrees
that a final judgment in any such suit, action or proceeding
brought in such a court, after all appropriate appeals, shall be
conclusive and binding upon it.
11.16. Service of Process
The Borrower hereby irrevocably consents to the service of
process in any suit, action or proceeding by sending the same by
first class mail, return receipt requested or by overnight
courier service, to the address of the Borrower set forth in
Section 11.2. The Borrower hereby agrees that any such service
(i) shall be deemed in every respect effective service of process
upon it in any such suit, action, or proceeding, and (ii) shall
to the fullest extent enforceable by law, be taken and held to be
valid personal service upon and personal delivery to it.
11.17. No Limitation on Service or Suit
Nothing in the Loan Documents or any modification, waiver,
consent or amendment thereto shall affect the right of the Agent
or any Lender to serve process in any manner permitted by law or
limit the right of the Agent or any Lender to bring proceedings
against the Borrower in the courts of any jurisdiction or
jurisdictions in which the Borrower may be served.
11.18. WAIVER OF TRIAL BY JURY
THE AGENT, THE LENDERS AND THE BORROWER HEREBY KNOWINGLY,
VOLUNTARILY AND INTENTIONALLY WAIVE ANY RIGHT IT MAY HAVE TO A
TRIAL BY JURY IN RESPECT OF ANY LITIGATION ARISING OUT OF, UNDER
OR IN CONNECTION WITH THE LOAN DOCUMENTS OR THE TRANSACTIONS
CONTEMPLATED THEREIN. FURTHER, THE BORROWER HEREBY CERTIFIES
THAT NO REPRESENTATIVE OR AGENT OF THE AGENT, OR THE LENDERS, OR
COUNSEL TO THE AGENT OR THE LENDERS, HAS REPRESENTED, EXPRESSLY
OR OTHERWISE, THAT THE AGENT OR THE LENDERS WOULD NOT, IN THE
EVENT OF SUCH LITIGATION, SEEK TO ENFORCE THIS WAIVER OF RIGHT TO
JURY TRIAL PROVISION. THE BORROWER ACKNOWLEDGES THAT THE AGENT
AND THE LENDERS HAVE BEEN INDUCED TO ENTER INTO THIS AGREEMENT
BY, INTER ALIA, THE PROVISIONS OF THIS SECTION.
[Remainder of page intentionally left blank]
IN WITNESS WHEREOF, the parties hereto have caused this
Revolving Credit Agreement (Facility A) to be duly executed and
delivered by their proper and duly authorized officers as of the
day and year first above written.
ATLANTIC ENERGY, INC.
By: /s/ Jerrold L. Jacobs
Name: Jerrold L. Jacobs
Title: President & Chief
Executive Officer
THE BANK OF NEW YORK,
Individually and as Agent
By: /s/ Mary Lou Bradley
Name: Mary Lou Bradley
Title: Vice President
THE FIRST NATIONAL BANK
OF CHICAGO
By: /s/ Kenneth J. Bauer
Name: Kenneth J. Bauer
Title: Authorized Agent
MELLON BANK, N.A.
By: /s/ A. Gary Chace
Name: A. Gary Chace
Title: Senior Vice President
ATLANTIC ENERGY EXHIBIT A
LIST OF COMMITMENTS
(Facility A)
Commitment
Lender Commitment Percentage
The Bank of New York $18,666,000 53.3314%
The First National Bank $11,667,000 33.3343%
of Chicago
Mellon Bank, N.A. $ 4,667,000 13.3343%
Total $35,000,000 100.0000%
ATLANTIC ENERGY EXHIBIT B-1
FORM OF REVOLVING CREDIT NOTE
(Facility A)
$________
______, 1995
New York, New York
FOR VALUE RECEIVED, on the Maturity Date,
ATLANTIC ENERGY,
INC., a New Jersey corporation (the "Borrower"), hereby promises
to pay to the order of ________________ (the "Lender"), at the
office of THE BANK OF NEW YORK, as Agent (the "Agent"), located
at One Wall Street, New York, New York or at such other place as
the Agent may specify from time to time, in lawful money of the
United States of America, the principal sum of $_____, or such
lesser unpaid principal balance as shall be outstanding here-
under, together with interest from the date hereof, on the unpaid
principal balance hereof, payable at the rate or rates and at the
time or times provided for in the Revolving Credit Agreement
(Facility A), dated as of September 28, 1995, among the Borrower,
the Lenders party thereto and the Agent (as the same may be
amended, modified or supplemented from time to time, the
"Agreement"). Capitalized terms used herein that are defined in
the Agreement shall have the meanings therein defined. In no
event shall interest payable hereon exceed the Highest Lawful
Rate.
This Note is one of the Revolving Credit Notes
referred to in
the Agreement and is entitled to the benefits of, and is subject
to the terms set forth in, the Agreement. The principal of this
Note is payable in the amounts and under the circumstances, and
its maturity is subject to acceleration upon the terms, set forth
in the Agreement. Except as otherwise provided in the Agreement,
if any payment on this Note becomes due and payable on a day
which is not a Business Day, the maturity thereof shall be
extended to the next Business Day and interest shall be payable
at the applicable rate or rates specified in the Agreement during
such extension period.
The (i) date and amount of each Revolving Credit
Loan made by
the Lender, (ii) its character as an ABR Advance or a Eurodollar
Advance, (iii) the Eurodollar Rate and Eurodollar Interest Period
applicable to any Eurodollar Advances, and (iv) each payment and
prepayment of the principal thereof, shall be recorded by the
Lender on its books and, prior to any transfer of this Note, may
be indorsed by the Lender on the schedule attached hereto or any
continuation thereof, provided that the failure of the Lender to
make any such recordation or indorsement shall not affect the
obligations of the Borrower to make payment when due of any
amount owing hereunder.
Presentment for payment, demand, protest, notice
of protest and
notice of dishonor and all other demands and notices in
connection with the delivery, performance and enforcement of this
Note are hereby waived, except as specifically otherwise provided
in the Agreement.
This Note is being delivered in, is intended to
be performed
in, and shall be construed and interpreted in accordance with and
be governed by the internal laws of, the State of New York,
without regard to principles of conflicts of law.
This Note may only be amended by an instrument
in writing
executed pursuant to the provisions of Section 11.1 of the
Agreement.
ATLANTIC ENERGY, INC.
By:
Name:
Title:
SCHEDULE TO
REVOLVING CREDIT NOTE
Interest
Rate on
Eurodollar
Advances
Type of Amount of (without
Advance(ABR principal regard to
or Eurodollar Amount of paid or Applicable
Date Rate) Advance prepaid Margin
SCHEDULE TO
REVOLVING CREDIT NOTE - continued
Interest
Period (if
Eurodollar Notation
Advance) Made By
ATLANTIC ENERGY EXHIBIT B-2
FORM OF COMPETITIVE BID NOTE
(Facility A)
________, 1995
New York, New York
FOR VALUE RECEIVED, ATLANTIC ENERGY, INC., a New Jersey cor-
poration (the "Borrower"), hereby promises to pay to the order of
____________________ (the "Lender"), at the office of THE BANK OF
NEW YORK, as Agent (the "Agent"), located at One Wall Street, New
York, New York or at such other place as the Agent may specify
from time to time, in lawful money of the United States of
America, the outstanding principal balance of the Lender's
Competitive Bid Loans, together with interest thereon payable at
the rate or rates and at the time or times provided for in the
Revolving Credit Agreement (Facility A), dated as of
September 28, 1995, among the Borrower, the Lenders party thereto
and the Agent (as the same may be amended, modified or
supplemented from time to time, the "Agreement"). Capitalized
terms used herein that are defined in the Agreement shall have
the meanings therein defined. In no event shall interest payable
hereon exceed the Highest Lawful Rate.
This Note is one of the Competitive Bid Notes referred to in
the Agreement and is entitled to the benefits of, and is subject
to the terms set forth in, the Agreement. The principal of this
Note is payable in the amounts and under the circumstances, and
its maturity is subject to acceleration upon the terms, set forth
in the Agreement. Except as otherwise provided in the Agreement,
if any payment on this Note becomes due and payable on a day
which is not a Business Day, the maturity thereof shall be
extended to the next Business Day and interest shall be payable
at the applicable rate or rates specified in the Agreement during
such extension period.
The (i) date and amount of each Competitive Bid Loan made by
the Lender, (ii) the interest rate and Interest Period applicable
thereto and (iii) each payment and prepayment of the principal
thereof, shall be recorded by the Lender on its books and, prior
to any transfer of this Note, may be indorsed by the Lender on
the schedule attached hereto or any continuation thereof,
provided that the failure of the Lender to make any such
recordation or indorsement shall not affect the obligations of
the Borrower to make payment when due of any amount owing
hereunder.
Presentment for payment, demand, protest, notice of protest and
notice of dishonor and all other demands and notices in
connection with the delivery, performance and enforcement of this
Note are hereby waived, except as specifically otherwise provided
in the Agreement.
This Note is being delivered in, is intended to be performed
in, and shall be construed and interpreted in accordance with and
be governed by the internal laws of, the State of New York,
without regard to principles of conflicts of law.
This Note may only be amended by an instrument in writing
executed pursuant to the provisions of Section 11.1 of the
Agreement.
ATLANTIC ENERGY, INC.
By:
Name:
Title:
SCHEDULE TO
COMPETITIVE BID NOTE
Amount of
Amount of Principal
Competitive Interest Bid Payment or Notation
Date Loan Period Rate Prepayment Made by
ATLANTIC ENERGY EXHIBIT C
FORM OF BORROWING REQUEST
(Facility A)
_______ __
,199_
The Bank of New York, as Agent
Agency Function Administration
One Wall Street
18th Floor
New York, New York 10286
Attention: Patricia Clancy
The Bank of New York, as Agent
Energy Industries Division
One Wall Street
19th Floor
New York, New York 10286
Attention: Mary Lou Bradley,
Vice President
Re: Revolving Credit Agreement (Facility A),
dated as of September 28, 1995, by and
among ATLANTIC ENERGY, INC. (the "Bor-
rower"), the Lenders party thereto, and THE
BANK OF NEW YORK, as Agent (the "Agree-
ment")
Capitalized terms used herein that are defined in the
Agreement shall have the meanings therein defined.
(a) Pursuant to Section 2.3 of the Agreement, the Bor-
rower hereby gives notice of its intention to borrow
Revolving Credit Loans in an aggregate principal amount of
$_______ on ______ __, 19__, which borrowing(s) shall consist
of the following Advances:
Initial Interest
Type of Advance
Period for Eurodollar
(Eurodollar or ABR) Amount
Advances
(a)
(b)
(b) The Borrower hereby certifies that on the date
hereof and, after giving effect to the Loans requested hereby
on the Borrowing Date set forth above:
(a) The Borrower is and shall be in compliance
with all of the terms, covenants and conditions of the
Agreement relating to such Loan.
(b) There exists and there shall exist no Event of
Default under the Agreement.
(c) Each of the representations and warranties
contained in the Agreement shall be true and correct with the
same effect as though such representations and warranties had
been made on such Borrowing Date, except to the extent such
representations and warranties specifically relate to an
earlier date, in which case such representations and
warranties are true and correct in all material respects on
and as of such earlier date.
(d) After giving effect to the Revolving Credit
Loans requested to be made hereby, the Aggregate Credit
Exposure will not exceed the Aggregate Commitments.
IN WITNESS WHEREOF, the Borrower has caused this request
and certificate to be executed by its Authorized Signatory as
of the date and year first written above.
ATLANTIC ENERGY, INC.
By:
Name:
Title:
ATLANTIC ENERGY EXHIBIT D
FORM OF COMPETITIVE BID REQUEST
(Facility A)
[Date]
The Bank of New York, as Agent
Agency Function Administration
One Wall Street
18th Floor
New York, New York 10286
Attention: Patricia Clancy
The Bank of New York, as Agent
Energy Industries Division
One Wall Street
19th Floor
New York, New York 10286
Attention: Mary Lou Bradley
Vice President
Re: Revolving Credit Agreement (Facility A),
dated as of September 28, 1995, by and
among ATLANTIC ENERGY, INC. (the "Bor-
rower"), the Lenders party thereto, and THE
BANK OF NEW YORK, as Agent (the "Agree-
ment")
Capitalized terms used herein which defined in the
Agreement shall have the meanings therein defined.
Pursuant to Section 2.4 of the Agreement, the Bor-
rower hereby gives notice of its request to borrow
Competitive Bid Loans in the aggregate sum of $____________
on ____________, which borrowing shall consist of the
following Competitive Interest Periods and amounts
corresponding thereto:
Competitive
Interest Period Amount
(1)
(2)
(3)
The Borrower hereby certifies that on the date hereof
and, after giving effect to the Competitive Bid Loans requested
hereby, on the Borrowing Date set forth above:
(a) The Borrower is and shall be in compliance
with all of the terms, covenants and conditions of the
Agreement relating to such Loans.
(b) There exists and there shall exist no Event of
Default under the Agreement.
(c) Each of the representations and warranties
contained in the Agreement shall be true and correct with the
same effect as though such representations and warranties had
been made on such Borrowing Date, except to the extent such
representations and warranties specifically relate to an
earlier date, in which case such representations and
warranties are true and correct in all material respects on
and as of such earlier date.
(d) After giving effect to the Competitive Bid
Loans requested to be made hereby, the Aggregate Credit
Exposure will not exceed the Aggregate Commitments.
IN WITNESS WHEREOF, the Borrower has caused this request
and certificate to be executed by its Authorized Signatory as
of the date and year first written above.
ATLANTIC ENERGY, INC.
By:
Name:
Title:
ATLANTIC ENERGY EXHIBIT E
FORM OF INVITATION TO BID
(Facility A)
_____ __, 199_
To the Lenders under the Credit
Agreement referred to below
Re: Revolving Credit Agreement (Facility A),
dated as of September 28, 1995, by and
among ATLANTIC ENERGY, INC. (the "Bor-
rower"), the Lenders party thereto, and THE
BANK OF NEW YORK, as Agent (the "Agree-
ment")
Capitalized terms used herein which are defined in
the Agreement shall have the meanings therein defined.
Pursuant to a Competitive Bid Request, a copy of
which is appended hereto or enclosed herewith, the Borrower
has given notice of its request to borrow Competitive Bid
Loans in the aggregate sum of $____________ on ____________
The Lenders are hereby invited to bid to make such
Competitive Bid Loans by 10:00 a.m. on the proposed Borrowing
Date, pursuant to the terms and conditions of the Agreement.
Very truly yours,
THE BANK OF NEW YORK,
as Agent
By:
Name:
Title:
ATLANTIC ENERGY EXHIBIT F
FORM OF COMPETITIVE BID
(Facility A)
_____ __, 199_
The Bank of New York, as Agent
Agency Function Administration
One Wall Street
18th Floor
New York, New York 10286
Attention: Patricia Clancy
The Bank of New York, as Agent
Energy Industries Division
One Wall Street
19th Floor
New York, New York 10286
Attention: Mary Lou Bradley,
Vice President
Re: Revolving Credit Agreement (Facility A),
dated as of September 28, 1995, by and
among ATLANTIC ENERGY, INC. (the "Bor-
rower"), the Lenders party thereto, and THE
BANK OF NEW YORK, as Agent (the "Agree-
ment")
Capitalized terms used herein that are defined in the
Agreement shall have the meanings therein defined.
In response to a Competitive Bid Request, the
undersigned Lender hereby offers to lend Competitive Bid
Loans in the aggregate sum of $____________ on ____________,
which borrowing shall consist of the following Competitive
Interest Periods and the amounts and Bid Rates corresponding
thereto:
Competitive
Interest Period Amount Bid Rate
(1)
(2)
(3)
Very truly yours,
[LENDER]
By:
Name:
Title:
ATLANTIC ENERGY EXHIBIT G
FORM OF COMPETITIVE BID ACCEPT/REJECT LETTER
(Facility A)
_______ __, 199_
The Bank of New York, as Agent
Agency Function Administration
One Wall Street
18th Floor
New York, New York 10286
Attention: Patricia Clancy
The Bank of New York, as Agent
Energy Industries Division
One Wall Street
19th Floor
New York, New York 10286
Attention: Mary Lou Bradley,
Vice President
Re: Revolving Credit Agreement (Facility A),
dated as of September 28, 1995, by and
among ATLANTIC ENERGY, INC. (the "Bor-
rower"), the Lenders party thereto, and THE
BANK OF NEW YORK, as Agent (the "Agree-
ment")
Capitalized terms used herein that are defined in the
Agreement shall have the meanings therein defined.
Pursuant to Section 2.4(c) of the Agreement, the Bor-
rower hereby gives notice of its [rejection/acceptance] of
[Lender's] Competitive Bid, dated _____ __, 199_, in the
aggregate sum of $_________ on ________, which borrowing
shall consist of the following Competitive Interest Periods
and the amounts and Bid Rates corresponding thereto:
Competitive
Interest Period Amount Bid Rate
(1)
(2)
(3)
Very truly yours,
ATLANTIC ENERGY, INC.
By:
Name:
Title:
ATLANTIC ENERGY EXHIBIT H
FORM OF COMPETITIVE BID LOAN CONFIRMATION
(Facility A)
_____ __, 199_
To [Lender]
Re: Revolving Credit Agreement (Facility A), dated as of
September 28, 1995, by and among ATLANTIC ENERGY, INC.
(the "Borrower"), the Lenders party thereto, and THE
BANK OF NEW YORK, as Agent (the "Agreement")
Capitalized terms used herein that are defined in
the Agreement shall have the meanings therein defined.
In accordance with Section 2.4(c) of the Agreement
we hereby notify you that pursuant to a Competitive Bid
Accept Letter, the Borrower gave notice of its acceptance of
[Lender's] Competitive Bid, dated _____________, in the
aggregate sum of $____________ on ____________, which
borrowing shall consist of the following Competitive Interest
Periods and the following amounts and Bid Rates corresponding
thereto:
Competitive
Interest Period Amount Bid Rate
(1)
(2)
(3)
Pursuant to Section 2.4(e) of the Agreement, [Lender]
is required to make available to the Agent at its office the
proceeds of Lender's Competitive Bid Loan(s) set forth in
Section 11.2 of the Agreement, in immediately available
funds, not later than 2:00 p.m. on the Borrowing Date
specified above.
Very truly yours,
THE BANK OF NEW YORK,
as Agent
By:
Name:
Title:
ATLANTIC ENERGY EXHIBIT I
FORM OF NOTICE OF CONVERSION/CONTINUATION
(Facility A)
_______ __, 199_
The Bank of New York, as Agent
Agency Function Administration
One Wall Street
18th Floor
New York, New York 10286
Attention: Patricia Clancy
The Bank of New York, as Agent
Energy Industries Division
One Wall Street
19th Floor
New York, New York 10286
Attention: Mary Lou Bradley,
Vice President
Re: Revolving Credit Agreement (Facility A),
dated as of September 28, 1995, by and
among ATLANTIC ENERGY, INC. (the "Bor-
rower"), the Lenders party thereto, and THE
BANK OF NEW YORK, as Agent (the "Agree-
ment")
Capitalized terms used herein that are defined in the
Agreement shall have the meanings therein defined.
1. Pursuant to Section 2.7 of the Agreement, the Bor-
rower requests to convert or continue Advances as set forth
below:
(a) on ____ __, 199_, to convert $_______ in
principal amount of presently outstanding Eurodollar Advances
having an Interest Period that expires on ____ __, 199_ to
ABR Advances.
(b) on ____ __, 199_, to continue as Eurodollar Ad-
vances, $_______ in principal amount of presently outstanding
Eurodollar Advances having an Interest Period that expires on
____ __, 199_ for an additional Interest Period of __ months;
(c) on ____ __, 199_, to convert $_______ in
principal amount of presently outstanding ABR Advances to
Eurodollar Advances that have an initial Interest Period of
__ months.
2. The Borrower hereby certifies that on the date
hereof and on the requested Conversion/Continuation Date set
forth above, there exists and there shall exist no Default or
Event of Default under the Agreement.
IN WITNESS WHEREOF, the Borrower has caused this request
and certificate to be executed by its Authorized Signatory as
of the date and year first written above.
ATLANTIC ENERGY, INC.
By:
Name:
Title:
ATLANTIC ENERGY EXHIBIT K
FORM OF COMPLIANCE CERTIFICATE
(Facility A)
I, ______________, do hereby certify that I am the
___________ of ATLANTIC ENERGY, INC., a New Jersey
corporation (the "Borrower"), and that, as such, I am duly
authorized to execute and deliver this Compliance Certificate
on the Borrower's behalf pursuant to Section 7.1(c) of each
of (i) the Revolving Credit Agreement (Facility A), dated as
of September 28, 1995, among the Borrower, the Lenders party
thereto and The Bank of New York, as Agent (as the same may
be amended, supplemented or otherwise modified from time to
time, the "Facility A Agreement") and (ii) the Revolving
Credit Agreement (Facility B), dated as of September 28,
1995, among the Borrower, the Lenders party thereto and The
Bank of New York, as Agent (as the same may be amended,
supplemented or otherwise modified from time to time, the
"Facility B Agreement" and, together with the Facility A
Agreement, the "Agreements"). Capitalized terms used herein
that are defined in the Agreements shall have the meanings
therein defined.
I hereby certify that:
1. The Indebtedness Capitalization Ratio as of ______ __,
199_ , is _.__:1.00, calculated as set forth on Schedule 1.
2 The Ratio of Indebtedness of the Borrower to Annualized
ACE Dividends as of ______ __, 199_, is _.__:1.00, calculated
as set forth on Schedule 2.
3. There exists no Event of Default under the Agreement.
IN WITNESS WHEREOF, I have
executed this Compliance Certificate on this ___ day of
______________, 19__.
_______________________
Schedule 1 to Compliance Certificate
dated __/__/__
COMPUTATION OF INDEBTEDNESS CAPITALIZATION RATIO
1. Total Indebtedness of the Borrower
and its Subsidiaries determined
on a Consolidated basis
in accordance with GAAP $_________
2. Preferred Stock and any premium
thereon of the Borrower and its
Subsidiaries determined on a
Consolidated basis in accordance
with GAAP $_________
3. Common Stock and any premium
thereon of the Borrower and its
Subsidiaries determined on a
Consolidated basis in accordance
with GAAP $_________
4. Retained earnings of the Borrower
and its Subsidiaries determined on a
Consolidated basis in accordance
with GAAP $_________
5. All Indebtedness (net of unamortized
premium and discount) of the Borrower
and its Subsidiaries determined on a
Consolidated basis in accordance
with GAAP $_________
6. Sum of Items 2 through 5 $_________
7. Unamortized capital Stock expense
of the Borrower and its Subsidiaries
determined on a Consolidated basis
in accordance with GAAP $_________
8. Items 6 minus Item 7 $_________
9. Indebtedness Capitalization Ratio
Item 1:Item 8 _.__:1.00
11. Maximum permitted ratio
pursuant to Section 7.10 of
each of the Agreements 0.65:1.00
Schedule 2 to Compliance Certificate
dated __/__/__
CALCULATION OF RATIO OF TOTAL INDEBTEDNESS OF THE BORROWER
TO ANNUALIZED ACE DIVIDENDS
1. Indebtedness of the Borrower
$_________
2.The amount of dividends paid
to the Borrower by ACE during
the fiscal quarter ending on
the date of determination or,
if such date of determination
is not a fiscal quarter ending
date, the immediately preceding
fiscal quarter $_________
3. Annualized ACE Dividends
(Item 2 multiplied by 4) $_________
4. Ratio of Indebtedness to Annualized
ACE Dividends
(Item 1:Item 3) _.__:1.00
5. Maximum permitted ratio
pursuant to Section 7.11 of
each of the Agreements 2.50:1.00.
ATLANTIC ENERGY EXHIBIT L
FORM OF PLEDGE AGREEMENT
(Facility A)
PLEDGE AGREEMENT (as amended, modified or supplemented from
time to time, this "Agreement"), dated as of ______ __, 1995,
made by ATLANTIC ENERGY, INC., a New Jersey corporation (the
"Borrower"), to THE BANK OF NEW YORK, in its capacity as
collateral agent (in such capacity, the "Secured Party") for
itself in its capacity as Agent and for the Lenders under and
as defined in each of the Facility A Credit Agreement as
defined below (in such capacity, the "Facility A Agent") and
the Facility B Credit Agreement as defined below (in such
capacity, the "Facility B Agent" and, together with the
Facility A Agent, the "Agents").
RECITALS
I. The Borrower has entered into
a. the Revolving Credit Agreement (Facility A), dated as of
the date hereof, among the Borrower, the Lenders party
thereto (each, a "Facility A Lender", and collectively, the
"Facility A Lenders") and the Facility A Agent (as the same
may be amended, supplemented or otherwise modified from time
to time, the "Facility A Credit Agreement") and b. the
Revolving Credit Agreement (Facility B), dated as of the date
hereof among the Borrower, the Lenders party thereto (each, a
"Facility B Lender", collectively, the "Facility B Lenders"
and together with the Facility A Lenders, the "Lenders") and
the Facility B Agent (as the same may be amended,
supplemented or otherwise modified from time to time, the
"Facility B Credit Agreement" and, together with the Facility
B Credit Agreement, the "Credit Agreements"). Capitalized
terms used herein that are not defined herein and are defined
in the Credit Agreements shall have the meanings defined
therein.
II. The Lenders have agreed a. to
make loans to the Borrower pursuant to, and upon the terms
and subject to the conditions specified in, the Facility A
Credit Agreement and b. to make loans to the Borrower and to
participate in Letters of Credit issued by Issuing Bank (as
defined in the Facility B Credit Agreement) pursuant to, and
upon the terms and subject to the conditions specified in,
the Facility B Credit Agreement. The Borrower desires to
secure the prompt and complete payment, observance and
performance of all of its obligations of every kind and
nature now or hereafter incurred, existing or created under
or in respect of the Loan Documents (as defined in the
Facility A Credit Agreement which Loan Documents are herein
referred to as the "Facility A Loan Documents") and the Loan
Documents (as defined in the Facility B Credit Agreement
which Loan Documents are herein referred to as the "Facility
B Loan Documents" and, together with the "Facility A Loan
Documents", the "Loan Documents"), as such obligations may be
amended, increased, modified, renewed, refinanced, refunded
or extended from time to time, (collectively, the
"Obligations").
III. The obligations of the
Lenders to make loans under the Credit Agreements and the
Issuing Bank to issue Letters of Credit under the Facility B
Credit Agreement and the Facility B Lenders to participate
therein are conditioned upon, among other things, the
execution and delivery by the Borrower of this Agreement.
In consideration of the premises
and in order to induce the Secured Party and the Lenders to
enter into the Credit Agreements and make the loans under the
Credit Agreements and the Issuing Bank to issue the Letters
of Credit under the Facility B Credit Agreement and the
Facility B Lenders to participate therein, the Borrower
hereby agrees with the Secured Party for its benefit and for
the ratable benefit of the Lenders as follows:
A.Grant of Security
To secure the prompt and complete
payment, observance and performance of all of the
Obligations, the Borrower hereby assigns and pledges to the
Secured Party, for its benefit, for the benefit of the
Agents, for the benefit of the Issuing Bank and for the
ratable benefit of the Lenders, and hereby grants to the
Secured Party, for its benefit, for the benefit of the
Agents, for the benefit of the Issuing Bank and for the
ratable benefit of the Lenders, a continuing first priority
security interest in all of the Borrower's right, title and
interest in and to all promissory notes and other debt
instruments evidencing Indebtedness owed by any of the
Borrower's Operating Subsidiaries to the Borrower (each, an
"Intercompany Note"), in each case whether now owned or
hereafter acquired, including, without limitation, the
Intercompany Notes owned on the date hereof as set forth on
Schedule 1, and all interest and other payments thereunder
and instruments and other Property from time to time
delivered in respect thereof or in exchange therefor, and all
additions thereto, substitutions and replacements therefor,
and the products and Proceeds thereof (the "Collateral").
As used herein, the term
"Proceeds" shall have the meaning as set forth in Article 9
of the New York Uniform Commercial Code (as the same is
amended from time to time, the "UCC") and, to the extent not
otherwise included, shall include, but not be limited to, a.
distributions payable in Property; b. any and all proceeds of
causes and rights of action or settlements thereof, escrowed
amounts or Property, judicial and arbitration judgments and
awards, payable to the Borrower from or in respect of any
Person from time to time; c. all claims of the Borrower for
losses or damages arising out of or relating to or for any
breach of any agreements, covenants, representations or
warranties or any default whether or not with respect to or
under any of the foregoing Collateral (without limiting any
direct or independent rights of the Secured Party or any
Lender with respect to the Collateral); and d. any and all
other amounts from time to time paid or payable under or in
connection with the Collateral.
B. Delivery of Collateral
All notes and other instruments
representing or evidencing the Collateral at any time owned
or acquired by the Borrower shall be delivered to and held by
or on behalf of the Secured Party pursuant hereto and shall
be in suitable form for transfer by delivery, and shall bear
appropriate indorsements or shall be accompanied by duly
executed instruments of transfer or assignments in blank, all
in form and substance satisfactory to the Secured Party.
Upon the occurrence and during the continuance of an Event of
Default, the Secured Party shall have the right, at any time
in its discretion and without notice to the Borrower, to
transfer to or to register in the name of the Secured Party
or any of its nominees any or all of the Collateral. In
addition, upon the occurrence and during the continuance of
an Event of Default, the Secured Party shall have the right
at any time to exchange certificates or instruments
representing or evidencing Collateral for certificates or
instruments of smaller or larger denominations.
C. Representations and Warranties
The Borrower represents and warrants as follows:
1. The Borrower is the legal and
beneficial owner of the Collateral, free and clear of all
Liens other than the Lien created by this Agreement.
2. This Agreement creates a valid
security interest in the Collateral, securing the payment of
the Obligations. The delivery and pledge of the Collateral
pursuant to this Agreement create a valid and perfected first
priority security interest in the Collateral securing the
payment of the Obligations.
3. The Intercompany Notes listed
on Schedule 1 constitute all of the Intercompany Notes held
by the Borrower on the date of this Agreement. To the best
of the Borrower's knowledge, each of such Intercompany Notes
has been duly authorized, issued and delivered, and
constitutes the legal, valid, binding and enforceable
obligations of the respective makers thereof.
D. Further Assurances
1. The Borrower agrees that from
time to time, at its expense, the Borrower shall promptly
execute and deliver all further instruments and documents,
and take all further action, that the Secured Party may
reasonably request, in order to perfect and protect any
security interests granted hereby or to enable the Secured
Party to exercise and enforce its rights and remedies
hereunder with respect to any Collateral. Without limiting
the generality of the foregoing, the Borrower shall promptly
execute and file such financing or continuation statements,
or amendments thereto, and such other instruments or notices,
and promptly take such other action as the Secured Party may
reasonably request, in order to perfect and preserve the
security interests granted hereby.
2. The Borrower hereby authorizes
the Secured Party to file one or more financing or
continuation statements, and amendments thereto, relative to
all or any part of the Collateral without the signature of
the Borrower where permitted by law. The Secured Party shall
provide the Borrower with a copy of any such statement or
amendment, provided that no failure to do so shall affect the
rights of the Secured Party hereunder, result in any
liability of the Secured Party or the Lenders to the Borrower
or in any way affect the validity of such filing. A
photographic or other reproduction of this Agreement or any
financing statement covering the Collateral or any part
thereof shall be sufficient as a financing statement where
permitted by law.
3. The Borrower shall furnish to
the Secured Party from time to time statements and schedules
further identifying and describing the Collateral and such
other reports in connection with the Collateral as the
Secured Party may reasonably request, all in reasonable
detail.
E. Certain Rights as to the Collateral
4. So long as no Event of Default
shall have occurred and be continuing:
a. The Borrower shall be entitled
to exercise any and all consensual rights pertaining to the
Collateral or any part thereof for any purpose not
inconsistent with the terms of this Agreement and the Credit
Agreements, provided, however, that the Borrower shall not
exercise or refrain from exercising any such right without
the consent of the Secured Party if such action or inaction
would have a material adverse effect on the fair market value
of any part of the Collateral or the validity, priority or
perfection of the security interests granted hereby or the
remedies of the Secured Party hereunder.
b. The Borrower shall be entitled
to receive and retain any and all principal, interest and
other distributions paid in respect of the Collateral to the
extent not prohibited by this Agreement, provided, however,
that any and all principal, interest and other distributions
paid or payable other than in cash in respect of, and
instruments and other Property received, receivable or
otherwise distributed in respect of, or in exchange for,
Collateral, shall forthwith be delivered to the Secured Party
to be held as Collateral and shall, if received by the
Borrower, be received in trust for the benefit of the Secured
Party, be segregated from the other Property of the Borrower,
and be forthwith delivered to the Secured Party, as
Collateral in the same form as so received (with any
necessary indorsement).
c. The Secured Party shall execute
and deliver (or cause to be executed and delivered) to the
Borrower all instruments as the Borrower may reasonably
request for the purpose of enabling the Borrower to exercise
the rights which it is entitled to exercise pursuant to
clause (i) above and to receive the principal or interest
payments, or other distributions which it is authorized to
receive and retain pursuant to clause (ii) above.
5. Upon the occurrence and during
the continuance of an Event of Default and at the Secured
Party's option and following written notice by the Secured
Party to the relevant Borrower:
a. All rights of
the Borrower to
exercise the consensual rights which it would otherwise be
entitled to exercise pursuant to Section 5(a)(i) and to
receive the principal, and interest payments and other
distributions which it would otherwise be authorized to
receive and retain pursuant to Section 5(a)(ii) shall cease,
and all such rights shall thereupon become vested in the
Secured Party, who shall thereupon have the sole right to
exercise such consensual rights and to receive and hold as
Collateral such principal or interest payments and
distributions.
b. All principal and interest
payments and other distributions which are received by the
Borrower contrary to the provisions of Section 5(b)(i) shall
be received in trust for the benefit of the Secured Party,
shall be segregated from other funds of the Borrower and
shall be forthwith paid over to the Secured Party as
Collateral in the same form as so received (with any
necessary indorsement).
6. In the event that all or any
part of the instruments constituting the Collateral are lost,
destroyed or wrongfully taken while such instruments are in
the possession of the Secured Party, the Borrower agrees that
it will cause the delivery of new instruments in place of the
lost, destroyed or wrongfully taken securities or instruments
upon request therefor by the Secured Party without the
necessity of any indemnity bond or other security other than
the Secured Party's agreement or indemnity therefor customary
for security agreements similar to this Agreement.
E. Other Covenants and Agreements
of the Borrower
The Borrower covenants and agrees
that on and after the date hereof until the indefeasible cash
payment in full of the Obligations, unless the Secured Party
shall otherwise consent in writing:
1. Defense of Collateral. It will
defend the Collateral against all claims and demands of all
Persons at any time claiming the same or any interest therein
adverse to the interests of the Secured Party.
2. Security Interest. The security
interest granted hereby constitutes and will at all times
constitute a continuing (and so long as the Secured Party has
possession of the Collateral) perfected first priority
security interests in the Collateral.
3. Encumbrances; Filings. It will
not (i) further hypothecate, pledge, encumber, transfer, sell
or otherwise suffer to exist a security interest in, or a
Lien on, the Collateral or any portion thereof in favor of
any Person other than the Secured Party as provided herein,
except for transfers or sales to the extent permitted under
the Credit Agreements or (ii) sign or file or authorize the
signing or filing of any document or instrument perfecting
any Lien on the Collateral. The inclusion of "Proceeds" of
the Collateral under the security interest granted herein
shall not be deemed a consent by the Secured Party to any
sale or other disposition of any Collateral.
F. Secured Party Appointed
Attorney-in-Fact
Effective upon the occurrence and
during the continuance of an Event of Default, the Borrower
hereby irrevocably appoints the Secured Party the Borrower's
attorney-in-fact, with full authority in the place and stead
of the Borrower and in the name of the Borrower or otherwise,
from time to time in the Secured Party's discretion, to take
any action and to execute any instrument which the Secured
Party may deem necessary or advisable to accomplish the
purposes of this Agreement, including, without limitation:
1. to ask, demand, collect, sue
for, recover, compromise, receive and give acquittance and
receipts for moneys due and to become due under or in respect
of any of the Collateral,
2. to file any claims or take any
action or institute any proceedings which the Secured Party
may deem necessary or desirable for the collection of any of
the Collateral or otherwise to enforce the rights of the
Secured Party with respect to any of the Collateral, and
3. to receive, indorse and collect
all instruments made payable to the Borrower representing any
principal payment, interest payment or other distribution in
respect of the Collateral or any part thereof and to give
full discharge for the same. The powers granted to the
Secured Party under this Section constitute a power coupled
with an interest which shall survive until all of the
Obligations have been indefeasibly paid in full in cash.
G. The Secured Party May Perform
If the Borrower fails to perform
any agreement contained herein, the Secured Party may itself
perform, or cause performance of, such agreement, and the
reasonable expenses of the Secured Party incurred in
connection therewith shall be payable by the Borrower under
Section 12.
H. The Secured Party's Duties
The powers conferred on the
Secured Party hereunder are solely to protect its interest in
the Collateral and shall not impose any duty upon it to
exercise any such powers. Except for the safe custody of any
Collateral in its possession and the accounting for moneys
actually received by it hereunder, the Secured Party shall
have no duty as to any Collateral. The Secured Party shall
be deemed to have exercised reasonable care in the custody
and preservation of the Collateral in its possession if the
Collateral is accorded treatment substantially equal to that
which the Secured Party accords its own property, it being
understood that the Secured Party shall not be under any
obligation to (i) ascertain or take action with respect to
exchanges, maturities, tenders or other matters relative to
any Collateral, whether the Secured Party or any Lender has
or is deemed to have knowledge of such matters, or (ii) take
any necessary steps to preserve rights against prior parties
or any other rights pertaining to any Collateral, but may do
so at its option, and all reasonable expenses incurred in
connection therewith shall be for the sole account of the
Borrower and shall be added to the Obligations.
I. Events of Default
The following shall each
constitute an "Event of Default" hereunder:
1. If any representation or
warranty made herein or in any certificate furnished by the
Borrower in connection with this Agreement shall prove to
have been incorrect or misleading (whether because of
misstatement or omission) in any material respect when made;
or
2. If the Borrower shall fail to
observe or perform any term, covenant or agreement contained
in Section 6(c) of this Agreement; or
3. If the Borrower shall fail to
perform or observe any other covenant or agreement on its
part to be performed or observed pursuant to this Agreement
and such failure shall have continued unremedied for a period
of thirty days after the Borrower shall become aware of such
failure; or
4. The occurrence of an Event of
Default under and as defined in either of the Credit
Agreements; or
5. If the Borrower shall contest
or disavow its obligations under this Agreement or this
Agreement shall not remain in full force and effect.
J. Remedies
Upon the occurrence of an Event
of Default or at any time thereafter during the continuance
thereof, the Secured Party may, and upon direction of the
Required Lenders shall, exercise any and all remedies and
other rights provided under this Agreement, including,
without limitation, the following:
1. The Secured Party may exercise
in respect of the Collateral, in addition to other rights and
remedies provided for herein or otherwise available to it,
all the rights and remedies of a secured party upon default
under the UCC (whether or not the UCC applies to the
Collateral) and also may without notice, except as specified
below, sell, assign, grant an option or options to purchase
or otherwise dispose of the Collateral or any part thereof at
public or private sale, at any exchange, broker's board or at
any of the Secured Party's offices or elsewhere, for cash, on
credit or for future delivery, and upon such other terms as
may be commercially reasonable. The Borrower agrees that, to
the extent notice of sale shall be required by law, at least
five Business Days' notice to the Borrower of the time and
place of any public sale or the time after which any private
sale is to be made shall constitute reasonable notification.
The Secured Party shall not be obligated to make any sale of
Collateral regardless of notice of sale having been given.
The Secured Party may adjourn any public or private sale from
time to time by announcement at the time and place fixed
therefor, and such sale may, without further notice, be made
at the time and place to which it was so adjourned.
2. Any cash held by the Secured
Party as Collateral and all cash proceeds received by the
Secured Party in respect of any sale of, collection from, or
other realization upon all or any part of the Collateral may,
in the discretion of the Secured Party, be held by the
Secured Party as Collateral for, and/or then or at any time
thereafter applied (after payment of any amounts payable to
the Secured Party pursuant to Section 12) in whole or in part
by the Secured Party, for the ratable benefit of the Lenders,
against all or any part of the Obligations in accordance with
Section 9.1 of each Credit Agreement. Any surplus of such
cash or cash proceeds held by the Secured Party and remaining
after payment in full of all the Obligations shall be
promptly paid over to the Borrower or to whomsoever may be
lawfully entitled to receive such surplus.
3. The Borrower hereby expressly
waives and covenants not to assert any appraisement,
valuation, stay, extension, redemption or similar laws, now
or at any time hereafter in force, which might delay, prevent
or otherwise impede the performance or enforcement of this
Agreement.
K. No Segregation of Moneys; No
Interest
No moneys or any other Property
received by the Secured Party hereunder need be segregated in
any manner except to the extent required by law, and any such
moneys or other Property may be deposited under such general
conditions as may be prescribed by law applicable to the
Secured Party, and neither the Secured Party nor any Lender
shall be liable for any interest thereon.
L. Notices
All notices and other
communications provided for hereunder shall be given in the
manner and to the addresses set forth in Section 11.2 of the
Facility A Credit Agreement. Any notice given to the Secured
Party as Secured Party thereunder shall be deemed to have
been given to The Bank of New York as Agent under the
Facility B Credit Agreement.
M. Continuing Security Interest;
Transfer of Notes
This Agreement shall create a
continuing security interest in the Collateral and shall (i)
remain in full force and effect until the indefeasible cash
payment in full of the Obligations and the termination of the
Credit Agreement, (ii) be binding upon the Borrower, its
successors and assigns and (iii) inure, together with the
rights and remedies of the Secured Party hereunder, to the
benefit of the Secured Party, any successor to Secured Party
as agent and the ratable benefit of the Lenders. Except to
the extent not permitted by Section 11.7 of the Credit
Agreements, any Lender may assign or otherwise transfer the
notes held by it under the Credit Agreements to any other
Person, and such other Person shall thereupon become vested
with all the benefits in respect thereof granted to such
Lender herein or otherwise. Nothing set forth herein or in
any other Loan Document is intended or shall be construed to
give any other Person any right, remedy or claim under, to or
in respect of this Agreement, any other Loan Document, or any
Collateral. The Borrower's successors and assigns shall
include, without limitation, a receiver, trustee or debtor-
in-possession thereof or therefor.
N. Other Provisions
1. This Agreement is the "Pledge
Agreement" referred to in each of the Credit Agreements.
Each of the Secured Party and the Borrower acknowledges that
certain provisions of each of the Credit Agreements,
including, without limitation, Sections 1.2 (Other
Definitional Provisions), 11.1 (Amendments and Waivers), 11.3
(No Waiver; Cumulative Remedies), 11.4 (Survival of
Representations and Warranties), 11.7 (Assignments and
Participations), 11.8 (Counterparts), 11.12 (Headings
Descriptive), 11.13 (Severability), 11.14 (Integration),
11.15 (Consent to Jurisdiction), 11.16 (Service of Process),
11.17 (No Limitation on Service or Suit) and 11.18 (WAIVER OF
TRIAL BY JURY) thereof, are made applicable to this Agreement
and all such provisions are incorporated by reference herein
as if fully set forth herein.
2. All Schedules hereto shall be
deemed to be a part hereof.
3. Each and every right, remedy
and power granted to the Secured Party hereunder or allowed
at law or by any other agreement shall be cumulative and not
exclusive, and may be exercised by the Secured Party from
time to time.
4. This Agreement shall be
governed by and construed in accordance with the laws of the
State of New York without regard to conflict of laws rules,
except to the extent that the validity or perfection of the
security interest hereunder, or remedies hereunder, in
respect of any particular Collateral are governed by the laws
of a jurisdiction other than the State of New York. Unless
otherwise defined herein, terms used in Articles 8 and 9 of
the UCC are used herein as therein defined.
The parties hereto have caused
this Pledge Agreement to be duly executed and delivered by
its officer thereunto duly authorized as of the date first
above written.
ATLANTIC ENERGY, INC.
By:
Name:
Title:
THE BANK OF NEW YORK,
as Collateral Agent for the
Facility A Lenders under the
Facility A Credit Agreement
and the Facility B Lenders
under the Facility B Credit
Agreement
By:
Name:
Title:
Schedule 1
to the Pledge Agreement,
Dated as of _____ __, 1995
LIST OF INTERCOMPANY NOTES
Maker Date
Atlantic Generation, Inc. _____ __, 1995
ATE Investment, Inc. _____ __, 1995
Atlantic Thermal Systems, Inc. _____ __, 1995
Atlantic Jersey Thermal Systems, Inc. _____ __, 1995
Atlantic Energy Technologies, Inc. _____ __, 1995
ATLANTIC ENERGY EXHIBIT M
FORM OF INTERCOMPANY NOTE
(Facility A)
THIS NOTE HAS NOT BEEN REGISTERED UNDER THE SECURITIES ACT OF
1933, AS AMENDED (THE "SECURITIES ACT"), OR REGISTERED OR
QUALIFIED UNDER ANY SECURITIES OR BLUE SKY LAWS. IT MAY NOT
BE SOLD, TRANSFERRED, PLEDGED OR OTHERWISE DISPOSED OF EXCEPT
IN A TRANSACTION COMPLYING WITH OR EXEMPT FROM THE
REGISTRATION REQUIREMENTS OF THE SECURITIES ACT AND IN
ACCORDANCE WITH ANY APPLICABLE SECURITIES LAWS OF ANY STATE.
____________ __, 199_
FOR VALUE RECEIVED, the undersigned, _________________,
a __________ corporation (the "Borrower"), hereby promises to
pay to the order of ATLANTIC ENERGY, INC. (the "Company"), at
the office of the Company, upon demand by the Company, the
aggregate unpaid principal amount of all loans made by the
Company to the Borrower from time to time as reflected on the
attached Schedule hereto, pursuant to an intercompany account
or otherwise, in lawful money of the United States of America
in same day funds, and to pay interest from the date set
forth on the attached Schedule on which principal is advanced
hereunder on the unpaid principal amount from time to time
outstanding, in like funds, at said office, with each
repayment of principal hereunder, at a rate per annum equal
to 1/4% above the borrowing rate of the Company for amounts
advanced hereunder and provided to the Borrower by the
Company on the date of any such advance. All interest
hereunder shall be calculated on the basis of the actual
number of days that principal is outstanding over a year of
365 or 366 days, as appropriate.
The unpaid principal amount hereof may be declared due
and payable by the Company, whereupon the same shall
immediately become due and payable, upon the occurrence or at
any time during the continuance of an Event of Default under,
and as defined in, either of the Revolving Credit Agreements
(Facility A or Facility B) among the Company, the Lenders
parties thereto, and The Bank of New York, as Agent.
The Borrower hereby waives diligence, presentment, de-
mand, protest and notice of any kind whatsoever. The
nonexercise by the holder of any of its rights hereunder in
any particular instance shall not constitute a waiver thereof
in that or any subsequent instance.
All borrowings evidenced by this Intercompany Note and
all payments and prepayments of the principal hereof and
interest hereon and the respective dates thereof shall be
endorsed by the holder hereof on the schedule attached hereto
and made a part hereof, or on a continuation thereof which
shall be attached hereto and made a part hereof, or otherwise
recorded by such holder in its internal records; provided,
however, that any failure of the holder hereof to make such a
notation or any error in such notation shall not in any
manner affect the obligation of the Borrower to make payments
of principal and interest in accordance with the terms of
this Intercompany Note.
NEITHER THE BORROWER NOR ANY OTHER PERSONS LIABLE FOR
THE INDEBTEDNESS TO THE COMPANY, NOR ANY ASSIGNEE, SURVIVOR,
HEIR OR PERSONAL REPRESENTATIVE OF THE BORROWER OR ANY SUCH
OTHER PERSON OR ENTITY SHALL SEEK A JURY TRIAL IN ANY
LAWSUIT, PROCEEDING, COUNTERCLAIM OR ANY OTHER LITIGATION
PROCEDURE BASED UPON OR ARISING OUT OF THIS INTERCOMPANY
NOTE, ANY RELATED INSTRUMENT OR AGREEMENT, ANY COLLATERAL FOR
THE PAYMENT HEREOF OR THE DEALINGS OR THE RELATIONSHIP
BETWEEN THE COMPANY AND SUCH PERSONS OR ENTITIES, OR ANY OF
THEM. NEITHER THE BORROWER NOR ANY SUCH PERSON OR ENTITY
WILL SEEK TO CONSOLIDATE ANY SUCH ACTION, IN WHICH A JURY
TRIAL HAS BEEN WAIVED, WITH ANY OTHER ACTION IN WHICH A JURY
TRIAL CANNOT BE OR HAS NOT BEEN WAIVED. THE PROVISIONS OF
THIS PARAGRAPH HAVE BEEN FULLY DISCUSSED BY THE BORROWER AND
THE COMPANY AND THE PROVISIONS HEREOF SHALL BE SUBJECT TO NO
EXCEPTIONS. THE BORROWER HAS NOT IN ANY WAY AGREED WITH OR
REPRESENTED TO ANY OTHER PARTY THAT THE PROVISIONS OF THIS
PARAGRAPH WILL NOT BE FULLY ENFORCED IN ALL INSTANCES.
THIS INTERCOMPANY NOTE SHALL BE CONSTRUED IN ACCORDANCE
WITH AND GOVERNED BY THE LAWS OF THE STATE OF NEW JERSEY AND
ANY APPLICABLE LAWS OF THE UNITED STATES OF AMERICA.
[BORROWER]
By:
Name:
Title:
SCHEDULE TO INTERCOMPANY NOTE
[BORROWER]
LOANS BALANCE OUTSTANDING
INTERCOMPANY ACCOUNT
Loan Balance
Date Advance Repayment Outstanding
_____ _______ _________ ____________
_____ _______ _________ ____________
_____ _______ _________ ____________
_____ _______ _________ ____________
_____ _______ _________ ____________
_____ _______ _________ ____________
_____ _______ _________ ____________
_____ _______ _________ ____________
_____ _______ _________ ____________
_____ _______ _________ ____________
_____ _______ _________ ____________
_____ _______ _________ ____________
_____ _______ _________ ____________
_____ _______ _________ ____________
_____ _______ _________ ____________
_____ _______ _________ ____________
_____ _______ _________ ____________
_____ _______ _________ ____________
_____ _______ _________ ____________
ENDORSEMENT
The undersigned, ATLANTIC ENERGY, INC. a New Jersey
corporation (the "Company"), hereby assigns, transfers and
endorses to and makes payable to the order of The Bank of New
York, as collateral agent for itself in its capacity as Agent
and the Lenders under and as defined in each of the (i)
Revolving Credit Agreement (Facility A), dated as of
September 28, 1995, among the Borrower, the Lenders party
thereto and the Agent (as the same may be amended,
supplemented or otherwise modified from time to time) and
(ii) Revolving Credit Agreement (Facility B), dated as of
September 28, 1995, among the Borrower, the Lenders party
thereto and the Agent (as the same may be amended,
supplemented or otherwise modified from time to time), that
certain Intercompany Note, dated ___________ __, ____, made
by ___________________ to the order of the Company. This
endorsement is made with recourse to the undersigned for
payment or collection.
DATED: __________ __, 199_
ATLANTIC ENERGY, INC.
By:
Name:
Title:
ATLANTIC ENERGY EXHIBIT N
MEMORANDUM OF OPINIONS TO BE GIVEN
BY COUNSEL TO THE BORROWER
In connection with the (i) Revolving Credit Agreement
(Facility A) (the "Facility A Agreement"), dated as of
September 28, 1995, by and among Atlantic Energy, Inc. (the
"Borrower"), the Lenders party thereto (the "Facility A
Lenders") and The Bank of New York, as Agent (the "Facility A
Agent") and (ii) Revolving Credit Agreement (Facility B) (the
"Facility B Agreement" and, together with the Facility A
Agreement, the "Agreements"), dated as of September 28, 1995,
by and among the Borrower, the Lenders party thereto (the
"Facility B Lenders"), The Bank of New York, as Issuing Bank
and The Bank of New York, as Agent (the "Facility B Agent"),
set forth below is the substance of the opinions to be
included in the opinion letters referred to in Section 5.8 of
the Facility B Agreement and the corresponding provision of
the Facility A Agreement (collectively, the "Opinions").
The opinion letters should be addressed to "The
Bank of New York, as Agent and as Issuing Bank and the
Lenders under the Credit Agreements referred to below". It
should specifically authorize Special Counsel's reliance
thereon.
Capitalized terms used in the Opinions and which
are not otherwise defined therein shall have the respective
meanings ascribed thereto in the Agreements. For purposes
of the opinions set forth below, the term "Transaction
Documents" means, collectively, the "Loan Documents" under
and as defined in each of the Agreements and the term "Notes"
means, collectively, the "Notes" under and as defined in each
of the Agreements.
Opinions:
1. The Borrower has only the Subsidiaries set
forth on Schedule 4.1 to each Agreement. The shares of each
Subsidiary are duly authorized, validly issued, fully paid
and nonassessable and are owned free and clear of any Liens.
2. Each of the Borrower and its Subsidiaries is
duly organized or formed and validly existing in good
standing under the laws of the jurisdiction of its in-
corporation or formation, has all requisite power and au-
thority to own its Property and to carry on its business as
now conducted, and is in good standing and authorized to do
business as a foreign corporation in each jurisdiction in
which the nature of the business conducted therein or the
Property owned therein makes such qualification necessary,
except where such failure to qualify, singly or in the
aggregate, could not reasonably be expected to have a
Material Adverse Effect.
3. The Borrower has full legal power and
authority and has taken all necessary actions, including,
without limitation, any necessary stockholder action, to
enter into, execute, deliver and perform the terms of the
Transaction Documents and to make the borrowings contemplated
thereby and by the Notes, to execute, deliver and carry out
the terms of the Notes and to incur the obligations provided
for therein, all of which have been duly authorized by all
proper and necessary corporate or other applicable action and
are in full compliance with its charter and by-laws or its
other organization documents.
4. Each of the Transaction Documents (other than
the Notes) constitutes, and the Notes, when issued and
delivered pursuant to the applicable Agreement for value
received, will constitute, the valid and legally binding
obligations of the Borrower, enforceable in accordance with
its respective terms.
5. To the best of counsel's knowledge after due
inquiry, except as set forth in the Financial Statements,
there are no actions, suits or proceedings at law or in
equity or by or before any Governmental Authority (whether or
not purportedly on behalf of the Borrower or any of its
Subsidiaries) pending or threatened against the Borrower or
any of its Subsidiaries or any of their respective Properties
or rights, which (i) reasonably may be expected to have a
Material Adverse Effect, or (ii) call into question the
validity or enforceability of any of the Transaction Docu-
ments.
6. Except for information filings required to be
made in the ordinary course of business which are not a
condition to the Borrower's performance under the Transaction
Documents, no consent, authorization or approval of, filing
with, notice to, or exemption by, stockholders, any
Governmental Authority or any other Person is required to
authorize, or is required in connection with the execution,
delivery and performance of the Transaction Documents or is
required as a condition to the validity or enforceability of
the Transaction Documents.
7. To the best of counsel's knowledge after due
inquiry, neither the Borrower nor any of its Subsidiaries is
in default (x) under any mortgage, indenture, contract or
agreement to which it is a party or by which it or any of its
Property is bound or (y) with respect to any judgment, order,
writ, injunction, decree or decision of any Governmental
Authority, the effect of which default could reasonably be
expected to have a Material Adverse Effect.
8. The execution, delivery or carrying out of the
terms of the Transaction Documents will not constitute a
default under, or require the mandatory repayment of, or
result in the creation or imposition of, or obligation to
create, any Lien upon any Property of the Borrower or any of
its Subsidiaries pursuant to the terms of, any such mortgage,
indenture, contract or agreement.
9. To the best of counsel's knowledge after due
inquiry, each of the Borrower and ACE possesses or has the
right to use all franchises, licenses, privileges and other
rights as are material and necessary for the conduct of its
business, and with respect to which it is in compliance, with
no known conflict with the valid rights of others which could
reasonably be expected to have a Material Adverse Effect.
10. The Borrower is not an "investment company" or
a company "controlled" by an "investment company" as defined
in, or is otherwise subject to regulation under, the
Investment Company Act of 1940, as amended.
11. The Borrower and each of its Subsidiaries are
exempt from the provisions of the Public Utility Holding
Company Act of 1935, as amended, except Section 9(a)(2)
thereof, pursuant to Rule 2 of the General Rules and
Regulations of the SEC under said Act.
12. To the best of counsel's knowledge after due
inquiry, neither the Borrower nor any of its Subsidiaries is
engaged principally, or as one of its important activities,
in the business of extending credit for the purpose of
purchasing or carrying any Margin Stock. If used in
accordance with Section 2.15 of each Agreement, no part of
the proceeds of the Loans will be used, directly or indi-
rectly, for a purpose which violates any law, rule or regula-
tion of any Governmental Authority, including without limita-
tion the provisions of Regulations G, T, U or X of the Board
of Governors of the Federal Reserve System, as amended. If
used in accordance with Section 2.15 of each Agreement, no
part of the proceeds of the Loans will be used, directly or
indirectly, to purchase or carry Margin Stock or to extend
credit to others for the purpose of purchasing or carrying
Margin Stock.
13. The Pledge Agreement is effective to create in
favor of The Bank of New York, as collateral agent for each
of The Bank of New York, as Agent under the Facility A
Agreement, The Bank of New York, as Agent under the Facility
B Agreement, The Bank of New York, Issuing Bank under the
Facility B Agreement and each of the Lenders under the
Agreements in all of the Borrower's right, title and interest
in and to all Intercompany Notes (as defined in the Pledge
Agreement) when issued and delivered, provided that such
Intercompany Notes remain in the continued possession of such
collateral agent.
14. To the best of counsel's knowledge after due
inquiry, no indenture, certificate of designation for pre-
ferred Stock, agreement or instrument to which the Borrower
or ACE is a party, prohibits or restrains, directly or indi-
rectly, the payment of dividends or other payments by ACE to
the Borrower except for the terms of the ACE Preferred Stock
as in existence on the Effective Date.
ATLANTIC ENERGY EXHIBIT O
FORM OF OPINION OF SPECIAL COUNSEL
_____ __, 1995
The Bank of New York,
as Agent and the other
Lenders under the Credit
Agreements referred to below
Ladies and Gentlemen:
We have acted as Special Counsel to (1) The Bank of New
York, as Agent (in such capacity, the "Facility A Agent") in
connection with the Revolving Credit Agreement (Facility A),
dated as of September 28, 1995, by and among Atlantic Energy,
Inc. (the "Borrower"), the Lenders party thereto and the
Facility A Agent (the "Facility A Agreement") and (2) The
Bank of New York, as Agent (in such capacity, the "Facility B
Agent") in connection with the Revolving Credit Agreement
(Facility B), dated as of September 28, 1995, by and among
the Borrower, the Lenders party thereto and the Facility B
Agent (the "Facility B Agreement" and, together with the
Facility A Agreement, the "Agreements"). Capitalized terms
used herein which are defined in the Facility A Agreement
shall have the meanings therein defined, unless the context
hereof otherwise requires.
We have examined originals or copies certified to our
satisfaction of the documents required to be delivered pursu-
ant to the provisions of Sections 5 and 6 of each of the
Agreements. In conducting such examination, we have assumed
the genuineness of all signatures, the authenticity of all
documents submitted to us as originals, and the conformity to
originals of all documents submitted to us as copies.
Based upon the foregoing examination, and relying with
your permission upon the opinions of Ballard Spahr Andrews &
Ingersoll, special counsel to the Borrower, and James E.
Franklin II, Esq., General Counsel of the Borrower, we are of
the opinion that all legal preconditions to the making of the
first Loans under and as defined in each of the Agreements
and the issuance of the first Letter of Credit under and as
defined in the Facility B Agreement have been satisfactorily met.
This opinion is rendered solely for your benefit in
connection with the transactions referred to herein and may
not be relied upon by any other Person.
In rendering the foregoing opinion, we express no
opinion as to laws other than the laws of the State of New
York and the federal laws of the United States of America.
Very truly yours,
EMMET, MARVIN & MARTIN,
LLP
ATLANTIC ENERGY EXHIBIT P
FORM OF ASSIGNMENT AND ACCEPTANCE AGREEMENT
This Assignment and Acceptance Agreement is made and en-
tered into as of _____ __, 19__, by and between ____________
(the "Assignor") and ____________ (the "Assignee").
R E C I T A L S
(i) All capitalized terms not otherwise defined herein
which are used herein shall have the meanings set forth in the
Facility A Credit Agreement (as defined below).
(ii) The Assignor, certain other lenders (together with
any prior assignees, the "Facility A Lenders") and The Bank of
New York, as agent (in such capacity the "Facility A Agent"),
are parties to that certain Revolving Credit Agreement
(Facility A), dated as of September 28, 1995 (the "Facility A
Credit Agreement") with ATLANTIC ENERGY, INC., a New Jersey
corporation (the "Borrower"). Pursuant to the Facility A
Credit Agreement, the Facility A Lenders (i) agreed to make
Revolving Credit Loans (the "Facility A Revolving Credit
Loans") under the Aggregate Commitments (as defined in the
Facility A Credit Agreement, which Aggregate Commitments are
hereinafter referred to as the "Aggregate Facility A
Commitments") in the aggregate amount of $35,000,000 and (ii)
may, in their sole discretion and upon the Borrower's request,
make Competitive Bid Loans to the Borrower from time to time
(the "Facility A Competitive Bid Loans" and, together with the
Facility A Revolving Credit Loans, the "Facility A Loans").
(iii) The amount of the Assignor's Facility A
Commitment (without giving effect to the assignment effected
hereby or to other assignments thereof which have not yet be-
come effective) is specified in Item 1 of Schedule 1 hereto.
The outstanding principal amount of the Assignor's Facility A
Loans (without giving effect to the assignment effected hereby
or to other assignments thereof which have not yet become
effective) is specified in Item 2 of Schedule 1 hereto.
(iv) The Assignor, certain other lenders (together with
any prior assignees, the "Facility B Lenders") and The Bank of
New York, as agent (in such capacity the "Facility B Agent"
and, together with it in its capacity as Facility A Agent, the
"Agent"), are parties to that certain Revolving Credit
Agreement (Facility B), dated as of September 28, 1995 (the
"Facility B Credit Agreement") with the Borrower. Pursuant to
the Facility B Credit Agreement, the Facility B Lenders (i)
agreed to make Revolving Credit Loans (the "Facility B
Revolving Credit Loans") under the Aggregate Commitments (as
defined in the Facility B Credit Agreement, which Commitments
are hereinafter referred to as the "Aggregate Facility B
Commitments" and, together with the Aggregate Facility A Com-
mitments, the "Aggregate Commitments") in the aggregate amount
of $40,000,000 and to participate in Letters of Credit issued
by the Issuing Bank (under and as defined in the Facility B
Credit Agreement) and (ii) may, in their sole discretion and
upon the Borrowers' request make Competitive Bid Loans to the
Borrower from time to time (the "Facility B Competitive Bid
Loans" and, together with the Facility B Revolving Credit
Loans, the "Facility B Loans").
(v) The amount of the Assignor's Facility B Commitment,
including its Letter of Credit Commitment (as defined in the
Facility B Credit Agreement and without giving effect to the
assignment effected hereby or to other assignments thereof
which have not yet become effective), is specified in Item 1 of
Schedule 1 hereto. The outstanding principal amount of the
Assignor's Facility B Loans, including its Letter of Credit
Exposure (as defined in the Facility B Credit Agreement and
without giving effect to the assignment effected hereby or to
other assignments thereof which have not yet become effective),
is specified in Item 2 of Schedule 1 hereto.
(vi) The Assignor wishes to sell and assign to the As-
signee, and the Assignee wishes to purchase and assume from the
Assignor, (i) the portion of the Assignor's Facility A
Commitment and Facility B Commitment specified in Item 3 of
Schedule 1 hereto (the "Assigned Commitment") and (ii) the
portion of the Assignor's Facility A Revolving Credit Loans,
Facility B Revolving Credit Loans and/or the portion of the
Assignor's Facility A Competitive Bid Loans or Facility B
Competitive Bid Loans specified in Item 5 of Schedule 1 hereto
(the "Assigned Loans").
The parties agree as follows:
(a) Assignment
Subject to the terms and conditions set forth herein
and in the Credit Agreements, the Assignor hereby sells and
assigns to the Assignee, and the Assignee hereby purchases and
assumes from the Assignor, without recourse, on the date set
forth above (the "Assignment Date") (i) all right, title and
interest of the Assignor to the Assigned Loans and (ii) all
obligations of the Assignor under the Credit Agreements with
respect to the Assigned Commitment. As full consideration for
the sale of the Assigned Loans and the Assigned Commitment, the
Assignee shall pay to the Assignor on the Assignment Date the
principal amount of the Assigned Loans (the "Purchase Price")
[and the Assignor shall pay to the Assignee on the Assignment
Date the fee specified in Item 6 of Schedule 1 hereto]. It is
understood by the parties hereto that each sale, assignment,
transfer or negotiation of rights under the Credit Agreements
shall be of an equal percentage of such Lenders interest under
in each of the Credit Agreements, it being the intention that
at all times during which the Facility A Credit Agreement and
Facility B Credit Agreement are both in effect, each Facility
A Lender shall be a Facility B Lender and its Commitment
Percentage in each thereof shall be identical.
(b) Representation and Warranties
Each of the Assignor and the Assignee represents and
warrants to the other that (i) it has full power and legal
right to execute and deliver this Agreement and to perform the
provisions of this Agreement; (ii) the execution, delivery and
performance of this Agreement have been authorized by all
action, corporate or otherwise, and do not violate any
provisions of its charter or by-laws or any contractual
obligations or requirement of law binding on it; and (iii) this
Agreement constitutes its legal, valid and binding obligation,
enforceable against it in accordance with its terms. The
Assignor further represents that it is the legal and beneficial
owner of the interest being assigned by it hereunder and that
such interest is free and clear of any adverse claim created by
the Assignor.
(c) Condition Precedent
The obligations of the Assignor and the Assignee
hereunder shall be subject to the fulfillment of the conditions
that the Assignor shall have (i) received payment in full of
the Purchase Price and (ii) complied with the other applicable
provisions of Section 11.7 of each Credit Agreement.
(d) Notice of Assignment
The Assignor agrees to give notice of the
assignment and assumption of the Assigned Loans and the
Assigned Commitment to the Agent and the Borrower and hereby
instructs the Agent and the Borrower to make all payments
with respect to the Assigned Loans and the Assigned Com-
mitment directly to the Assignee at the applicable Lending
Offices specified on Schedule 2 hereto; provided, however,
that the Borrower and the Agent shall be entitled to continue
to deal solely and directly with the Assignor in connection
with the interests so assigned until the Agent, the Issuing
Bank and the Borrower, to the extent required by Section 11.7
of each Credit Agreements, shall have received notice of the
assignment and shall have consented in writing thereto by
signing this Agreement and the Agent shall have recorded and
accepted this Agreement and received the Assignment Fee
required to be paid pursuant to Section 11.7 of each Credit
Agreement. From and after the date (the "Assignment Effec-
tive Date") on which the Agent shall notify the Borrower and
the Assignor that the requirements set forth in the foregoing
sentence shall have occurred and all consents (if any)
required shall have been given, (i) the Assignee shall be
deemed to be a party to the Credit Agreements and, to the
extent that rights and obligations thereunder shall have been
assigned to the Assignee as provided in such notice of as-
signment to the Agent, shall have the rights and obligations
of a Lender under the Credit Agreements, and (ii) the
Assignee shall be deemed to have appointed the Agent to take
such action as agent on its behalf and to exercise such
powers under the Loan Documents as are delegated to the Agent
by the terms thereof, together with such powers as are
reasonably incidental thereto. After the Assignment
Effective Date, the Agent shall make all payments in respect
of the interest assigned hereby (including payments of prin-
cipal, interest, fees and other amounts) to the Assignee.
The Assignor and Assignee shall make all appropriate adjust-
ment in payments under the Assigned Loans and the Assigned
Commitment for periods prior to the Assignment Effective Date
hereof directly between themselves. If the Assignee is not a
United States Person as defined in Section 7701(a)(30) of the
Code, the Assignee shall deliver herewith the forms required
by Section 2.10(c) of the Credit Agreements to evidence the
Assignee's complete exemption from United States withholding
taxes with respect to payments under the Loan Documents.
(e) Independent Investigation
The Assignee acknowledges that it is purchasing the
Assigned Loans and the Assigned Commitments from the Assignor
totally without recourse and, except as provided in Section 2
hereof, without representation or warranty. The Assignee
further acknowledges that it has made its own independent
investigation and credit evaluation of the Borrower in
connection with its purchase of the Assigned Loans and the
Assigned Commitments. Except for the representations or
warranties set forth in Section 2, the Assignee acknowledges
that it is not relying on any representation or warranty of
the Assignor, expressed or implied, including, without
limitation, any representation or warranty relating to the
legality, validity, genuineness, enforceability,
collectibility, interest rate, repayment schedule or accrual
status of the Assigned Loans or the Assigned Commitment, the
legality, validity, genuineness or enforceability of any
Loan Document, or financial condition or creditworthiness of
the Borrower or any other Person. The Assignor has not and
will not be acting as either the representative, agent or
trustee of the Assignee with respect to matters arising out
of or relating to the Credit Agreements or this Agreement.
From and after the Assignment Effective Date, except as set
forth in Section 4 above, the Assignor shall have no rights
or obligations with respect to the Assigned Loans or the
Assigned Commitments.
(f) Consent of the Borrower; Issuance of Notes.
1. Pursuant to the provisions of Section 11.7 of
each Credit Agreement, and to the extent required thereby,
the Borrower, by signing below, consents to this Agreement
and to the assignment contemplated herein. The Borrower
further agrees to execute and deliver:
(i) to the Assignee, (a) a Facility A
Revolving Credit Note, in an aggregate principal amount of
$____, (b) a Facility B Revolving Credit Note, in an ag-
gregate principal amount of $____, (c) a Facility A
Competitive Bid Note and (d) a Facility B Competitive Bid
Note; and
(ii) to the Assignor, (a) a Facility A
Revolving Credit Note, in an aggregate principal amount of
$____, and (b) a Facility B Revolving Credit Note, in an ag-
gregate principal amount of $____.
2. Upon receipt of its new Notes as set forth in
subsection (a)(ii) above, the Assignor shall deliver its
replaced Facility A Revolving Credit Note and Facility B
Revolving Credit Note to the Borrower.
(g) Method of Payment
All payments to be made by either party hereunder
shall be in funds available at the place of payment on the
same day and shall be made by wire transfer to the account
designated by the party to receive payment.
(h) Integration
This Agreement shall supersede any prior agreement
or understanding between the parties (other than the Credit
Agreements) as to the subject matter hereof.
(i) Counterparts
This Agreement may be executed in any number of
counterparts, each of which shall be deemed to be an original
and shall be binding upon both parties, their successors and
assigns.
(j) Headings
Section headings have been inserted herein for
convenience only and shall not be construed to be a part
hereof.
(k) Amendments; Waivers
This Agreement may not be amended, changed, waived
or modified except by a writing executed by the parties
hereto, and may not be amended, changed, waived or modified
in any manner inconsistent with Section 11.7 of each Credit
Agreement without the prior written consent of the Agent.
(l) Governing Law.
This Agreement shall be governed by, and construed
and interpreted in accordance with, the internal laws of the
State of New York, without regard to principles of conflict
of laws.
IN WITNESS WHEREOF, the parties hereto have caused this
Assignment and Acceptance Agreement to be duly executed and
delivered by their proper and duly authorized officers as of
the day and year first above written.
, as Assignor
By:
Name:
Title:
, as Assignee
By:
Name:
Title:
Consented to:
ATLANTIC ENERGY, INC.
By:
Name:
Title:
Accepted:
THE BANK OF NEW YORK, as Agent
By:
Name:
Title:
THE BANK OF NEW YORK, as Issuing Bank
By:
Name:
Title:
SCHEDULE 1
TO
ASSIGNMENT AND ACCEPTANCE AGREEMENT
between
_____________________, as Assignor
and
_____________________, as Assignee
relating to
Revolving Credit Agreement (Facility A) and
Revolving Credit Agreement (Facility B),
each dated as of September 28, 1995
among
ATLANTIC ENERGY, INC.,
the respective Lenders party thereto,
and
The Bank of New York, as Agent,
Item 1. Assignor's Commitments*
(a) Facility A Commitment $___________
(b) Facility B Commitment $___________
Item 2. Assignor's Loans:
(a) Facility A Revolving
Credit Loans* consisting
of:
ABR Advances $___________
Eurodollar Advances $___________
Letter of Credit Exposure $___________
* Without giving effect to the assisgnment contemplated
hereby or other assignments which have not as yet become
efective.
(b) Facility A Competitive
Bid Loans* consisting of Loans
at the interest rates and
for the Interest Periods
set forth below:
Rate: __% Interest Period: ___ $___________
Rate: __% Interest Period: ___ $___________
Rate: __% Interest Period: ___ $___________
(c) Facility B Revolving
Credit Loans* consisting
of:
ABR Advances $___________
Eurodollar Advances $___________
(d) Facility B Competitive
Bid Loans* consisting of Loans
at the interest rates and
for the Interest Periods
set forth below:
Rate: __% Interest Period: ___ $___________
Rate: __% Interest Period: ___ $___________
Rate: __% Interest Period: ___ $___________
Item 3. Amount of Assigned Commitments:
(a) Assigned Facility A Revolving
Credit Commitment $___________
(b) Assigned Facility B Revolving
Credit Commitment $___________
Item 4. Percentage of Assigned Commitments
in Facility A as a percentage of
the Aggregate Commitments
of Facility A of all Facility
A Lenders ___%
Percentage of Assigned Commitments
in Facility B as a percentage of
the Aggregate Commitments
of Facility B of all Facility
A Lenders ___%
Item 5. Amount of Assigned Loans:
(a) Assignor's Facility A Revolving
Credit Loans consisting
of:
ABR Advances $___________
Eurodollar Advances $___________
Letter of Credit Exposure $___________
(b) Assignor's Facility A Competitive
Bid Loans consisting of Loans
at the interest rates and
for the Interest Periods
set forth below:
Rate: __% Interest Period: ___ $___________
Rate: __% Interest Period: ___ $___________
Rate: __% Interest Period: ___ $___________
(c) Assignor's Facility B Revolving
Credit Loans consisting
of:
ABR Advances $___________
Eurodollar Advances $___________
(d) Assignor's Facility B Competitive
Bid Loans consisting of Loans
at the interest rates and
for the Interest Periods
set forth below:
Rate: __% Interest Period: ___ $___________
Rate: __% Interest Period: ___ $___________
Rate: __% Interest Period: ___ $___________
Item 6. Amount of Fee
payable to Assignee $___________
SCHEDULE 2
TO
ASSIGNMENT AND ACCEPTANCE AGREEMENT
between
_____________________, as Assignor
and
_____________________, as Assignee
relating to
Revolving Credit Agreement (Facility A) and
Revolving Credit Agreement (Facility B),
each dated as of September 28, 1995
among
ATLANTIC ENERGY, INC.,
the respective Lenders party thereto,
and
The Bank of New York, as Agent,
DOMESTIC LENDING OFFICE EURODOLLAR LENDING OFFICE
____________________ ____________________
____________________ ____________________
____________________ ____________________
Attention: ______________ Attention: ______________
Telephone: (___) ___-____ Telephone: (___) ___-____
Telecopy: (___) ___-____ Telecopy: (___) ___-____
ADDRESS FOR NOTICES
____________________
____________________
____________________
Attention: ______________
Telephone: (___) ___-____
Telecopy: (___) ___-____
ATLANTIC ENERGY EXHIBIT Q
FORM OF GUARANTY AND SUBORDINATION AGREEMENT
Guaranty and Subordination Agreement (as the same may be
amended, supplemented or otherwise modified from time to
time, this "Guaranty"), dated as of _____ __, 199_, made by
_________, a ______ corporation (" ") and each Person
which becomes a party hereto pursuant to Section 10 hereof
(together with _________, the "Guarantors", each, a
"Guarantor") and ATLANTIC ENERGY, INC., a New Jersey
corporation (the "Borrower") to THE BANK OF NEW YORK, as
Agent (in such capacity, the "Agent") [(i)] for itself and
for the ratable benefit of the Lenders.
A. The Borrower has entered into two Revolving Credit
Agreements (Facility A and Facility B), dated as of
September 28, 1995, among the Borrower, the signatory Lenders
thereto and the Agent (as the same may be amended, extended,
increased, modified, refunded or refinanced from time to
time, the "Credit Agreements"). Section 8.7 of the Credit
Agreements provides that the Guarantors and the Borrower
shall execute and deliver this Guaranty in the event that the
Borrower shall convert or forgive Intercompany Notes of the
Guarantors.
B. The Guarantors have derived and expect to continue
to derive substantial benefit from the Credit Agreements and
the making of the Loans and the issuance of the Letters of
Credit thereunder, including, without limitation, the
lending, directly or indirectly, by the Borrower of a portion
of the proceeds of the Loans to the Guarantors. The
Guarantors acknowledge that the Agent and the Lenders are
relying on this Guaranty in agreeing to continue to make the
Loans subsequent to the conversion or forgiveness of an
Intercompany Note, and that the Agent and the Lenders would
not do so without the execution and delivery of this
Guaranty.
C. Each of the Guarantors wishes to (i) guarantee the
obligations of the Borrower under the Loan Documents and (ii)
subordinate, subject to the terms and conditions contained
herein, any obligations due it from the Borrower to the prior
indefeasible cash payment in full of the Borrower Obligations
(as hereinafter defined).
In consideration of the premises and agreements herein
contained and other good and valuable consideration, the
receipt and sufficiency of which are hereby acknowledged, and
in order to induce the Agent and the Lenders to make the
Loans and to induce BNY to issue the Letters of Credit and
the Lenders to participate therein, the Borrower and each of
the Guarantors covenant and agree as follows:
1. Definitions
Except as otherwise provided herein, capitalized
terms that are defined in the Credit Agreements and are not
defined herein shall have the meanings assigned to such terms
therein. For purposes hereof, the following terms shall have
the following meanings:
"Additional Guarantor": each Guarantor which
becomes a party hereto pursuant to Section 10 hereof.
"Borrower Obligations": all obligations and
liabilities, whether now existing or hereafter arising, of
the Borrower under the Loan Documents, whether direct,
indirect or contingent, incurred as primary obligor or
otherwise, secured or unsecured, and whether or not on open
account, including all principal and interest thereon
(whether arising or accruing before or after the occurrence
of any Event of Default set forth in Section 9.1(i) or (j) of
the Credit Agreements and whether allowed as a claim), and
all reasonable costs and expenses of the Agent and the
Lenders in enforcing, preserving and protecting any thereof,
whether or not suit is instituted (as the same may be
amended, increased, modified, renewed, refinanced, refunded
or extended from time to time).
"Consideration": as of any date of determination
and with respect to each Guarantor, an amount equal to the
lesser of (a) the total "value" (within the meaning of
Section 548 of the Bankruptcy Code as in effect on the date
hereof) given, directly or indirectly, to such Guarantor
during the period commencing on the date such Guarantor
became a party to this Guaranty and ending on such date of
determination, in exchange for its execution and delivery of
this Guaranty, and (b) the amount of "fair consideration"
(within the meaning of Article 10 of the New York Debtor
Creditor Law as in effect on the date hereof) given, directly
or indirectly, to such Guarantor during the period commencing
on the date such Guarantor became a party to this Guaranty
and ending on such date of determination in exchange for its
execution and delivery of this Guaranty.
"Guarantor Obligations": with respect to each
Guarantor, all of the obligations and liabilities of such
Guarantor hereunder, whether fixed, contingent, now existing
or hereafter arising, created, assumed, incurred or acquired.
"Net Worth": as of any date and with respect to
each Guarantor, the lesser of the following:
(a)(i) all of such Guarantor's "property, at a
fair valuation" (within the meaning of Section 101(32) of the
Bankruptcy Code as in effect on the date hereof) on such
date, minus (ii) the sum of such Guarantor's "debts" (within
the meaning of Section 101(12) of the Bankruptcy Code as in
effect on the date hereof) on such date, or
(b)(i) the "fair salable value of the assets"
(within the meaning of Article 10 of the New York Debtor
Creditor Law as in effect on the date hereof) of such
Guarantor on such date, minus (ii) "the amount that will be
required to pay such Guarantor's probable liability on its
existing debts as they become absolute and matured" (as such
phrase would be construed under Article 10 of the New York
Debtor Creditor Law as in effect on the date hereof) on such
date.
"Subordinated Debt": all indebtedness for borrowed
money and any other obligations, contingent or otherwise, of
the Borrower to any Guarantor, including, without limitation,
all amounts, fees and expenses payable by the Borrower to any
Guarantor in respect thereof, in each case whether
outstanding on the date of execution of this Guaranty or
hereafter arising or created.
"Supplement": a Supplement to this Guaranty, duly
completed, in the form of Annex 1 hereto.
(e) Guaranty
(A) Subject to Section 2(b) hereof, each Guarantor
hereby absolutely, irrevocably and unconditionally guarantees
the full and prompt payment when due (whether at stated
maturity, by acceleration or otherwise) of the Borrower
Obligations. This Guaranty constitutes a guaranty of
payment, and neither the Agent nor any Lender shall have any
obligation to enforce any Loan Document or exercise any right
or remedy with respect to any collateral security thereunder
by any action, including, without limitation, making or
perfecting any claim against any Person or any collateral
security for any of the Borrower Obligations prior to being
entitled to the benefits of this Guaranty. The Agent may, at
its option, proceed against the Guarantors, or any one or
more of them, in the first instance to enforce the Guarantor
Obligations without first proceeding against the Borrower or
any other Person, and without first resorting to any other
rights or remedies, as the Agent may deem advisable. In
furtherance hereof, if the Agent or any Lender is prevented
by law from collecting or otherwise hindered from collecting
or otherwise enforcing any Borrower Obligation in accordance
with its terms, the Agent or such Lender, as the case may be,
shall be entitled to receive hereunder from the Guarantors
after demand therefor, the sums which would have been
otherwise due had such collection or enforcement not been
prevented or hindered.
(B) Notwithstanding anything to the contrary
contained in this Guaranty, the maximum liability of each
Guarantor hereunder shall not, as of any date of
determination, exceed the lesser of (i) the highest amount
that is valid and enforceable against such Guarantor under
principles of New York State contract law, and (ii) the sum
of (1) all Consideration received by such Guarantor as of
such date of determination, plus (2) the lesser of (A) 95% of
the Net Worth of such Guarantor on the date such Guarantor
became a party to this Guaranty after giving effect to (1)
this Guaranty and (2) the receipt by such Guarantor of any
Consideration on the date such Guarantor became a party to
this Guaranty, and (B) 95% of the Net Worth of such Guarantor
on such date of determination.
(C) Each Guarantor agrees that its Guarantor
Obligations may at any time and from time to time exceed the
maximum liability of such Guarantor hereunder without
impairing this Guaranty or affecting the rights and remedies
of the Agent or any Lenders hereunder.
(D) Subject to the limitations contained in
Section 2(b), the obligations hereunder of each Guarantor
shall be joint and several with the obligations hereunder of
the other Guarantors from time to time party hereto.
(f) Absolute Obligation
Subject to Section 9, no Guarantor shall be
released from liability hereunder unless and until the
Maturity Date shall have occurred and either (a) the Borrower
Obligations shall have been indefeasibly paid in full, in
cash, or (b) the Guarantor Obligations of such Guarantor
shall have been paid in full, in cash. Each Guarantor
acknowledges and agrees that (1) neither the Agent nor any
Lender has made any representation or warranty to such
Guarantor with respect to the Borrower, its Subsidiaries, any
Loan Document or any agreement, instrument or document
executed or delivered in connection therewith or any other
matter whatsoever, and (2) such Guarantor shall be liable
hereunder, and such liability shall not be affected or
impaired, irrespective of (A) the validity or enforceability
of any Loan Document or any agreement, instrument or document
executed or delivered in connection therewith, or the
collectability of any of the Borrower Obligations, (B) the
preference or priority ranking with respect to any of the
Borrower Obligations, (C) the existence, validity,
enforceability or perfection of any security interest or
collateral security under any Loan Document or the release,
exchange, substitution or loss or impairment of any such
security interest or collateral security, (D) any failure,
delay, neglect or omission by the Agent or any Lender to
realize upon any direct or indirect collateral security,
indebtedness, liability or obligation, any Loan Document or
any agreement, instrument or document executed or delivered
in connection therewith, or any of the Borrower Obligations,
(E) the existence or exercise of any right of set-off by the
Agent or any Lender, (F) the existence, validity or
enforceability of any other guaranty with respect to any of
the Borrower Obligations, the liability of any other Person
in respect of any of the Borrower Obligations, or the release
of any such Person or any other guarantor of any of the
Borrower Obligations, (G) any act or omission of the Agent or
any Lender in connection with the administration of any Loan
Document or any of the Borrower Obligations, (H) the
bankruptcy, insolvency, reorganization or receivership of, or
any other proceeding for the relief of debtors commenced by
or against, any Person, (I) the disaffirmance or rejection,
or the purported disaffirmance or purported rejection, of any
of the Borrower Obligations, any Loan Document or any
agreement, instrument or document executed or delivered in
connection therewith, in any bankruptcy, insolvency,
reorganization or receivership, or any other proceeding for
the relief of debtors, relating to any Person, (J) any law,
regulation or decree now or hereafter in effect which might
in any manner affect any of the terms or provisions of any
Loan Document or any agreement, instrument or document
executed or delivered in connection therewith or any of the
Borrower Obligations, or which might cause or permit to be
invoked any alteration in the time, amount, manner or payment
or performance of any of the Borrower's obligations and
liabilities (including, without limitation, the Borrower
Obligations), (K) the merger or consolidation of the Borrower
into or with any Person, (L) the sale by the Borrower of all
or any part of its assets, (M) the fact that at any time and
from time to time none of the Borrower Obligations may be
outstanding or owing to the Agent or any Lender, (N) any
amendment or modification of, or supplement to, any Loan
Document or (O) any other reason or circumstance which might
otherwise constitute a defense available to or a discharge of
the Borrower in respect of its obligations or liabilities
(including, without limitation, the Borrower Obligations) or
of such Guarantor in respect of any of the Guarantor
Obligations (other than by the performance in full thereof).
(g) Representations and Warranties
Each of the Guarantors hereby makes the following
representations and warranties to the Agent:
(A) Existence and Power. It is duly organized
or formed and validly existing in good standing under the
laws of the jurisdiction of its incorporation or formation,
has all requisite power and authority to own its Property and
to carry on its business as now conducted, and is in good
standing and authorized to do business as a foreign
corporation in each jurisdiction in which the nature of the
business conducted therein or the Property owned therein
makes such qualification necessary, except where such failure
to qualify could not reasonably be expected to have a
Material Adverse Effect.
(B) Authority. It has full legal power and
authority to enter into, execute, deliver and perform the
terms of the Loan Documents to which it is a party and the
transactions contemplated thereby, all of which have been
duly authorized by all proper and necessary corporate or
other applicable action and are in full compliance with its
Certificate of Incorporation or By-Laws or its other
organization documents.
(C) Binding Agreement. The Loan Documents to
which its is a party constitute its valid and legally binding
obligations, enforceable in accordance with its terms, except
as such enforceability may be limited by applicable
bankruptcy, insolvency, reorganization or other similar laws
affecting the enforcement of creditors' rights generally.
(D) Litigation. Except as disclosed in a
schedule to the Credit Agreements, there are no actions,
suits or proceedings at law or in equity or by or before any
Governmental Authority (whether purportedly on its behalf)
pending or, to its knowledge, threatened against it or any of
its Property or rights, which (i) if adversely determined,
could reasonably be expected to have a Material Adverse
Effect, (ii) call into question the validity or
enforceability of any of the Loan Documents, (iii) could
reasonably be expected to result in the rescission,
termination or cancellation of any material franchise, right,
license, permit or similar authorization held by it or (iv)
might materially and adversely affect any of the
Transactions.
(E) Required Consents. No consent,
authorization or approval of, filing with, notice to, or
exemption by, stockholders, any Governmental Authority or any
other Person is required to authorize, or is required in
connection with the execution, delivery and performance of
the Loan Documents to which it is a party and the
transactions contemplated thereby, or is required as a
condition to the validity or enforceability of such Loan
Documents.
(F) No Conflicting Agreements. It is not in
default under any mortgage, indenture, contract or agreement
to which it is a party or by which it or any of its Property
is bound, the effect of which default could reasonably be
expected to have a Material Adverse Effect. The execution,
delivery or carrying out of the terms of the Loan Documents
to which it is a party and the transactions contemplated
thereby, will not constitute a default under, or result in
the creation or imposition of, or obligation to create, any
Lien upon any of its Property or result in a breach of or
require the mandatory repayment of or other acceleration of
payment under or pursuant to the terms of any such mortgage,
indenture, contract or agreement.
(G) Compliance with Applicable Laws. It is not
in default with respect to any judgment, order, writ,
injunction, decree or decision of any Governmental Authority
which default could reasonably be expected to have a Material
Adverse Effect. It is complying in all material respects
with all statutes, regulations, rules and orders applicable
to it of all Governmental Authorities a violation of which
could reasonably be expected to have a Material Adverse
Effect.
(H) Property. It has good and marketable title
to all of its Property, title to which is material to such
Guarantor, subject to no Liens, except for Liens described in
Section 8.2(i), (ii), (iii), (iv), (v), (vi) or (vii) of the
Credit Agreements.
(I) Franchises, Intellectual Property, Etc. It
possesses or has the right to use all franchises,
Intellectual Property, licenses and other rights as are
material and necessary for the conduct of its business, and
with respect to which it is in compliance, with no known
conflict with the valid rights of others which could
reasonably be expected to have a Material Adverse Effect. No
event has occurred which permits or, to the best of its
knowledge, after notice or the lapse of time or both, or any
other condition, could reasonably be expected to permit, the
revocation or termination of any such franchise,
Intellectual Property, license or other right which
revocation or termination could reasonably be expected to
have a Material Adverse Effect.
(J) No Misrepresentation. No representation or
warranty contained in any Loan Document to which it is a
party and no certificate or report furnished or to be
furnished by it in connection with the transactions
contemplated thereby, contains or will contain a misstatement
of material fact, or, to the best of its knowledge, omits or
will omit to state a material fact required to be stated in
order to make the statements therein contained not misleading
in the light of the circumstances under which made.
(h) Events of Default
Each of the following shall constitute an "Event of
Default" hereunder:
(A) Any of the Guarantors shall fail to
observe or perform any term, covenant or agreement contained
in Section 2 of this Guaranty; or
(B) Any of the Guarantors shall fail to
perform or observe any other term, covenant or agreement on
its part to be performed or observed pursuant to this
Guaranty and such failure shall have continued unremedied for
a period of 30 days after such Guarantor shall become aware
of such failure; or
(C) Any representation of any Guarantor
contained herein or in any certificate, report or notice
delivered or to be delivered by such Guarantor pursuant
hereto shall prove to have been incorrect or misleading in
any material respect when made; or
(D) This Guaranty shall cease to be in full
force and effect or any of the Guarantors shall so assert or
shall disavow any of its obligations hereunder; or
(E) The occurrence of an "Event of Default"
under and as defined in the Credit Agreements.
(i) Subordination
(A) No payment of any nature whatsoever due in
respect of the Subordinated Debt payable to any of the
Guarantors shall be made unless and until the Borrower
Obligations have been first indefeasibly paid in full in
cash.
(B) Upon any bankruptcy, insolvency, liquidation
or reorganization of the Borrower, or upon the filing of a
petition in bankruptcy or commencement of any proceeding in
bankruptcy against the Borrower or upon any distribution of
the assets of the Borrower or upon any dissolution, winding
up, liquidation or reorganization of the Borrower, whether in
bankruptcy, insolvency, reorganization, arrangement or
receivership proceedings, or upon any assignment for the
benefit of creditors, or any other marshalling of the assets
and liabilities of the Borrower, or in the event any of the
Subordinated Debt shall for any reason become or be declared
due and payable or otherwise:
(i) the Agent shall first be entitled to
receive indefeasible payment in full in cash of the Borrower
Obligations (whenever arising) before any Guarantor shall be
entitled to receive any payment on account of the
Subordinated Debt;
(ii) any payment by, or distribution of the
assets of, the Borrower of any kind or character, whether in
cash, property or securities, to which any Guarantor would be
entitled except for the provisions of this Guaranty, in
connection with the Subordinated Debt, shall be paid or
delivered by the Person making such payment or distribution
(whether a trustee in bankruptcy, a receiver, custodian or
liquidating trustee or otherwise) directly to the Agent to
the extent necessary to make payment in full in cash of the
Borrower Obligations remaining unpaid, after giving effect to
any concurrent payment or distribution (or provision
therefor) in cash to the Agent; and
(iii) None of the Guarantors shall ask, demand
by legal proceedings or otherwise, or take or receive from
the Borrower, by set-off, counterclaim or in any other
manner, any payment or distribution on account of the
Subordinated Debt other than as expressly permitted
hereunder;
(iv) Each of the Guarantors agrees to declare
the Subordinated Debt to be due and payable and, at least 30
days before the time required by applicable law or rule, to
file proof of claim therefor, in default of which the Agent
is hereby irrevocably authorized so to declare and file in
order to effectuate the provisions hereof; and
(v) The Agent shall have the right, and is
hereby authorized, to vote the interest of each Guarantor
with respect to the Subordinated Debt, including, without
limitation, the right to make all acceptances, rejections,
consents or approvals on its behalf (including the right to
accept, approve or disapprove of any plan of reorganization)
in connection with any insolvency or other proceeding, and to
execute and deliver for and on behalf of the Guarantor any
instrument, agreement or other document in connection
therewith, and if for any reason this clause shall not be
enforceable, each Guarantor agrees to vote and give or make
such acceptances, rejections, consents or approvals in the
manner directed by the Agent. Each of the Guarantors hereby
irrevocably appoints the Agent its attorney-in-fact for
purposes of exercising the rights and authority granted to it
under this clause.
Notwithstanding the foregoing, in the event that
any payment by, or distribution of the assets of, the
Borrower of any kind or character prohibited hereby, whether
in cash, property or securities, shall for any reason be
received by any of the Guarantors in respect of the
Subordinated Debt, such payment or distribution shall be held
in trust for the benefit of the Agent, and shall be
immediately paid over to the Agent, to the extent necessary
to make payment in full in cash of the Borrower Obligations
remaining unpaid, after giving effect to any concurrent
payment or distribution (or provision therefor) in cash to
the Agent.
(C) Without the prior written consent of the
Agent, the Borrower will not give, and none of the Guarantors
will receive or accept, any collateral of any nature
whatsoever for the Subordinated Debt on any Property or
assets, whether now existing or hereafter acquired, of the
Borrower.
(D) Nothing contained in this Guaranty is intended
to or shall impair, as between and among the Borrower, its
creditors (other than the holders of the Borrower
Obligations) and the Guarantors, the obligation of the
Borrower to pay to the Guarantors any amount due in respect
of the Subordinated Debt as and when the same shall become
due and payable in accordance with the terms thereof, or
affect the relative rights of the Guarantors and the
creditors of the Borrower (other than the holders of the
Borrower Obligations), in each case subject to the rights of
the holders of the Borrower Obligations under this Guaranty.
(E) Unless and until the Borrower Obligations have
been indefeasibly paid in full in cash and the Credit
Agreements have been terminated, each of the Guarantors
agrees not to declare any part of the Subordinated Debt to be
due and payable or exercise any of the rights or remedies
which it may have, or bring (in its capacity as holder of the
Subordinated Debt) or join with any other creditor in
instituting, any proceedings against the Borrower under any
bankruptcy, insolvency, reorganization, arrangement,
receivership or other similar law, unless the Borrower
Obligations shall have been declared immediately due and
payable or, in the case of the institution of any such
proceedings, the Agent shall have joined in the institution
thereof or expressly consented thereto in writing. In the
event that the Agent shall have so declared the Borrower
Obligations immediately due and payable, each of the
Guarantors agrees to declare the Subordinated Debt then due
to be due and payable, provided, however, if the Agent shall
rescind any such declaration, each of the Guarantors shall
automatically be deemed to have rescinded its declaration.
(F) No right of the Agent to enforce this Guaranty
shall at any time or in any way be prejudiced or impaired by
any act or failure to act on the part of any of the
Guarantors, or by any noncompliance by the Guarantors with
the terms, provisions and covenants herein, and the Agent are
hereby expressly authorized to extend, waive, renew,
increase, decrease, modify or amend the terms of the Borrower
Obligations or any collateral security therefor, and to waive
any default, modify, amend, rescind or waive any provision of
any document executed and delivered in connection with the
Borrower Obligations and to release, sell or exchange any
such collateral security and otherwise deal freely with the
Borrower, all without notice to or consent of the Guarantors
and without affecting the liabilities and obligations of the
parties hereto.
(G) The Borrower and the Guarantors each waives
notice of acceptance of this Guaranty by the Agent and the
Lenders, and each of the Guarantors waives notice of and
consents to the making, amount and terms of the Borrower
Obligations which may exist from time to time and any
renewal, extension, increase, amendment or modification
thereof and any other action which the Agent or the Lenders
in its sole and absolute discretion, may take or omit to take
with respect thereto. This Section (g) shall constitute a
continuing offer to the Agent and the Lenders, its provisions
are made for the benefit of the Agent and the Lenders, and
the Agent and the Lenders are made obligees hereunder and may
enforce such provisions.
(H) Each of the Guarantors agrees that no payment
or distribution to the Agent pursuant to the provisions of
this Guaranty shall entitle any of the Guarantors to exercise
any rights of subrogation in respect thereof until the
Borrower Obligations shall have been indefeasibly paid in
full in cash. Each of the Guarantors agrees that the
subordination provisions contained herein shall not be
affected by any action or failure to act by the holders of
the Borrower Obligations which results, or may result, in
affecting, impairing or extinguishing any right of
reimbursement or subrogation or other right or remedy of such
Guarantor.
(I) None of the Guarantors shall sell, assign,
transfer or otherwise dispose of all or any part of the
Subordinated Debt without having first obtained the prior
written consent of the Agent which consent may be withheld
for any reason or for no reason.
(J) The Borrower agrees that it will not make any
payment of any of the Subordinated Debt, or take any other
action, in contravention of the provisions of this Guaranty.
(K) Each of the Guarantors agrees that the
provisions of this Guaranty shall be applicable to the
Borrower Obligations whenever the same may arise and
notwithstanding the fact that no Borrower Obligations may be
outstanding from time to time and may have paid down to zero
at any time or from time to time, it being understood that
the Credit Agreements permit the Borrower to borrow, repay
and reborrow from time to time subject to the terms and
conditions thereof, all or any of which terms and conditions
may be waived.
(L) All rights and interests of the Agent
hereunder, and all agreements and obligations of the Borrower
and the Guarantors under this Guaranty, shall remain in full
force and effect irrespective of:
(i) any lack of validity or enforceability of
any of the Loan Documents;
(ii) any change in the time, manner or place
of payment of, or any other term of, all or any of the
Borrower Obligations, or any other amendment or waiver of or
any consent to departure from any of the Borrower
Obligations;
(iii) any exchange, release or non-perfection
of the Collateral, or any release or amendment or waiver of
or consent to or departure from any guaranty, for all or any
of the Borrower Obligations; or
(iv) any other circumstance which might
otherwise constitute a defense available to, or a discharge
of, the Borrower in respect of the Borrower Obligations or
this Guaranty. This Guaranty shall continue to be effective
or be reinstated, as the case may be, if at any time any
payment of any of the Borrower Obligations is rescinded or
must otherwise be returned by the Agent upon the insolvency,
bankruptcy or reorganization of the Borrower or otherwise,
all as though such payment had not been made.
(M) Each of the Guarantors authorizes the Agent,
without notice or demand and without affecting or impairing
the obligations of any of the Guarantors, from time to time
to (i) renew, compromise, extend, increase, accelerate or
otherwise change the time for payment of, or otherwise change
the terms of the Borrower Obligations, or any part thereof,
including, without limitation, to increase or decrease the
rate of interest thereon or the principal amount thereof;
(ii) take or hold security for the payment of the Borrower
Obligations and exchange, enforce, foreclose upon, waive and
release any such security; (iii) apply such security and
direct the order or manner of sale thereof as the Agent, in
its sole discretion, may determine; (iv) release and
substitute one or more indorsers, warrantors, borrowers or
other obligors; and (v) exercise or refrain from exercising
any rights against the Borrower or any other Person.
(j) Notices
Except as otherwise specifically provided herein,
all notices, requests, consents, demands, waivers and other
communications hereunder shall be given in the manner
provided in Section 11.2 of the Credit Agreements and, if to
the Agent or the Borrower, at their respective addresses set
forth therein or, if to the Guarantor, the address set forth
below (or if to an Additional Guarantor, to the address set
forth in the Supplement executed and delivered by such
Additional Guarantor) or to such other addresses as to which
the Agent may be hereafter notified by the respective parties
hereto:
Attention: ,
Telephone: ( ) ___-____
Fax: (___) ___-____.
(k) Expenses
The Guarantors will upon demand pay to the Agent
any and all reasonable sums, costs and expenses which the
Agent may pay or incur pursuant to the provisions of this
Guaranty or in negotiating, executing or enforcing this
Guaranty or in enforcing payment of its Guarantor
Obligations, including, but not limited to court costs,
reasonable collection charges, reasonable travel expenses,
and reasonable attorneys' fees and disbursements. All sums,
costs and expenses which are due and payable pursuant to this
Section shall bear interest, payable on demand, at the
highest rate then payable on the Borrower Obligations.
(l) Repayment in Bankruptcy, etc.
If, at any time or times subsequent to the payment
of all or any part of the Borrower Obligations or the
Guarantor Obligations, the Agent or any Lender shall be
required to repay any amounts previously paid by or on behalf
of the Borrower or any Guarantor in reduction thereof by
virtue of an order of any court having jurisdiction in the
premises, including, without limitation, as a result of an
adjudication that such amounts constituted preferential
payments or fraudulent conveyances, the Guarantors
unconditionally agree to pay to the Agent within 10 days
after demand a sum in cash equal to the amount of such
repayment, together with interest on such amount from the
date of such repayment by the Agent or such Lender, as the
case may be, to the date of payment to the Agent at the
applicable after-maturity rates set forth in the Credit
Agreements.
(m) Additional Guarantors
Upon the execution and delivery to the Agent of a
Supplement by any Person, such Person shall be a Guarantor.
(n) Other Provisions
(A) This Guaranty is the "Guaranty" referred to in
the Credit Agreements. Each of the Agent and the Guarantors
acknowledges that certain provisions of the Credit
Agreements, including, without limitation, Sections 11.1
(Amendments and Waivers), 11.3 (No Waiver; Cumulative
Remedies), 11.7 (Assignments and Participations), 11.8
(Counterparts), 11.12 (Governing Law), 11.14 (Severability),
11.15. (Integration), 11.16 (Consent to Jurisdiction), 11.17
(Service of Process), 11.18 (No Limitation on Service or
Suit) and 11.19 (WAIVER OF TRIAL BY JURY) thereof, are made
applicable to this Guaranty and all such provisions are
incorporated by reference herein as if fully set forth
herein.
(B) All Schedules and Annexes hereto shall be
deemed to be a part hereof. With respect to an Additional
Guarantor, all references in this Agreement to (i) a Schedule
hereof shall refer to the corresponding Schedule to the
Supplement executed and delivered by such Additional
Guarantor and (ii) the date hereof, shall refer to the date
on which the Additional Guarantor became a Grantor hereunder
by executing and delivering a Supplement.
(C) No failure by the Agent to exercise, and no
delay by the Agent in exercising, any right or remedy
hereunder shall operate as a waiver thereof.
(D) Each and every right, remedy and power granted
to the Agent hereunder or allowed at law, in equity or by
other agreement shall be cumulative and not exclusive, and
may be exercised by the Agent from time to time.
(E) Each Guarantor hereby waives presentment,
demand for payment, notice of default, nonperformance and
dishonor, protest and notice of protest of or in respect of
this Guaranty, the Loan Documents and the Borrower
Obligations, notice of acceptance of this Guaranty and
reliance hereupon by the Agent and each Lender, and the
incurrence of any of the Borrower Obligations, notice of any
sale of collateral security or any default of any sort and
notice of any amendment, modification, increase or waiver of
any Loan Document.
(F) No Guarantor is relying upon the Agent or any
Lender to provide to such Guarantor any information
concerning the Borrower or any Subsidiary of the Borrower,
and each Guarantor has made arrangements satisfactory to such
Guarantor to obtain from the Borrower on a continuing basis
such information concerning the Borrower and its Subsidiaries
as such Guarantor may desire.
(G) Each Guarantor agrees that any statement of
account with respect to the Borrower Obligations from the
Agent or any Lender to the Borrower which binds the Borrower
shall also be binding upon such Guarantor, and that copies of
said statements of account maintained in the regular course
of the Agent's or such Lender's business, as the case may be,
may be used in evidence against such Guarantor in order to
establish its Guarantor Obligations.
(H) Each Guarantor acknowledges that it has
received a copy of the Loan Documents. In addition, such
Guarantor acknowledges having read each Loan Document and
having had the advice of counsel in connection with all
matters concerning its execution and delivery of this
Guaranty, and, accordingly, waives any right it may have to
have the provisions of this Guaranty strictly construed
against the Agent and the Lenders.
The Guarantors and the Borrower have each caused this
Guaranty to be duly executed and delivered by its duly
authorized officer as of the date first above written.
By:
Name:
Title:
By:
Name:
Title:
Accepted and Agreed to:
THE BANK OF NEW YORK, as Agent
By:
Name:
Title:
Annex 1 to the Guaranty and
Subordination Agreement
FORM OF SUPPLEMENT TO GUARANTY AND SUBORDINATION AGREEMENT
SUPPLEMENT, dated as of _____ __, 199_, made by ___________,
a ______ corporation (the "New Guarantor") to the Guaranty
(the "Guaranty"), dated as of ____ __, 1994, made by each
Guarantor party thereto and ATLANTIC ENERGY, INC., a New
Jersey corporation (the "Borrower") to THE BANK OF NEW YORK,
as Agent (in such capacity, the "Agent").
Reference is made to the Credit Agreements (Facility A and
Facility B), dated as of September 28, 1995, by and among the
Borrower, the Lenders party thereto (the "Lenders") and the
Agent (as the same may be amended, extended, increased,
modified, refunded or refinanced from time to time, the
"Credit Agreements").
Capitalized terms used herein and not otherwise defined
herein shall have the meanings assigned to such terms in the
Guaranty or the Credit Agreements, as the case may be.
Accordingly, the Agent and the New Guarantor agree as
follows:
In accordance with Section 10 of the Guaranty, by signing
this Supplement, the New Guarantor (a) shall be, and shall be
deemed to be, a "Guarantor" under, and as such term is
defined in, the Guaranty with the same force and effect as if
originally named therein as a Guarantor, (b) shall have made,
and shall be deemed to have made, the representations and
warranties contained in Section 4 of the Guaranty on and as
of the date hereof, and (c) shall have made, and shall be
deemed to have made, all of the covenants and agreements of a
Guarantor set forth in the Guaranty.
Except as expressly supplemented hereby, the Guaranty shall
remain in full force and effect.
This Supplement shall be governed by and construed in
accordance with the laws of the State of New York without
regard to conflicts of laws rules.
Every provision of this Supplement is intended to be
severable, and if any term or provision hereof shall be
invalid, illegal or unenforceable for any reason, the
validity, legality and enforceability of the remaining
provisions hereof or thereof shall not be affected or
impaired thereby, and any invalidity, illegality or
unenforceability in any jurisdiction shall not affect the
validity, legality or enforceability of any such term or
provision in any other jurisdiction.
(o)For purposes of Section 7 of the Guaranty, the address of the New
Grantor is as follows:
Attention: ,
Telephone: (___) ___-____
Fax: (___) ___-____.
This Supplement may be executed in two or more counterparts,
each of which shall constitute an original, but all of which,
when taken together, shall constitute but one instrument.
This Supplement shall become effective when the Agent shall
have received counterparts of this Supplement that, when
taken together, bear the signatures of the New Grantor and
the Agent.
The New Grantor and the Agent have duly executed
this Supplement to the Guaranty as of the day and year first
above written.
[NAME OF NEW GUARANTOR]
By:
Name:
Title:
THE BANK OF NEW YORK, AS AGENT
By:
Name:
Title:
ATLANTIC ENERGY SCHEDULE 1.1
TO REVOLVING CREDIT AGREEMENT (FACILITY A)
DATED AS OF SEPTEMBER 28, 1995
LIST OF LENDING OFFICES
DOMESTIC LENDING OFFICES EURODOLLAR LENDING OFFICES
1.The Bank of New York The Bank of New York
One Wall Street One Wall Street
Agency Function Administration Agency Function Administration
18th Floor 18th Floor
New York, NY 10286 New York, NY 10286
Attention: Patricia Clancy Attention:Patricia Clancy
Telephone: (212) 635-4696 Telephone:(212) 635-4696
Telecopy: (212) 635-6365 or Telecopy: (212) 635-6365 or
(212) 635-6366 or (212) 635-6366 or
(212) 635-6367 (212) 635-6367
2.The First National Bank The First National Bank
of Chicago of Chicago
One First National Plaza One First National Plaza
Chicago, IL 60670 Chicago, IL 60670
Attention:Peggy Corcoran or Attention:Peggy Corcoran or
Rita Bhatia Rita Bhatia
Operating Services Dept. Operating Services Dept.
Telephone:(312) 732-5957 or Telephone:(312) 732-5957 or
(312) 732-5205 (312) 732-5205
Telecopy: (312) 732-4840 Telecopy: (312) 732-4840
3.Mellon Bank, N.A. Mellon Bank, N.A.
Three Mellon Bank Center Three Mellon Bank Center
Room 2302 Room 2302
Pittsburgh, PA 15259-0003 Pittsburgh, PA 15259-0003
Attention:Sue Cooke Attention:Sue Cooke
Loan Administration Loan Administration
Telephone:(412) 236-0437 Telephone:(412) 236-0437
Telecopy: (412) 236-2027 or Telecopy: (412) 236-2027 or
(412) 236-2028 (412) 236-2028
Facility B
[Conformed Copy]
REVOLVING CREDIT AGREEMENT (FACILITY B)
by and among
ATLANTIC ENERGY, INC.,
THE LENDERS PARTY HERETO,
AND
THE BANK OF NEW YORK, AS AGENT
________________
$40,000,000
________________
Dated as of September 28, 1995
TABLE OF CONTENTS
1. DEFINITIONS AND PRINCIPLES OF CONSTRUCTION 1
1.1. Definitions 1
1.2. Principles of Construction 16
2. AMOUNT AND TERMS OF LOANS AND LETTERS OF CREDIT 17
2.1. Revolving Credit Loans 17
2.2. Revolving Credit Notes 17
2.3. Procedure for Borrowing Revolving Credit Loans 17
2.4. Competitive Bid Loans; Procedure 19
2.5. Voluntary Reduction or Termination of Aggregate
Commitments; Letter of Credit 21
2.6. Prepayments of the Loans 22
2.7. Conversions and Continuations 22
2.8. Interest Rate and Payment Dates 23
2.9. Substituted Interest Rate 25
2.10 Taxes 25
2.11 Illegality 27
2.12 Increased Costs 28
2.13 Indemnification for Loss 29
2.14 Survival of Certain Obligations 29
2.15 Use of Proceeds 29
2.16 Capital Adequacy 30
2.17 Change of Lending Office; Right to Substitute
Lender 30
2.18. Letter of Credit Sub-Facility 31
2.19. Letter of Credit Participation and Funding
Commitments 32
2.20. Absolute Obligation with respect to Letter of
Credit Payments 33
2.21. Increased Costs Based on Letters of Credit 33
2.22. Extension of Maturity Date 34
2.23. Change in Control 36
2.24. Agent's Records 37
3. FEES; PAYMENTS 37
3.1. Facility Fee 37
3.2. Letter of Credit Fees 37
3.3. Agent's Fees 37
3.4. Pro Rata Treatment and Application of Principal
Payments 38
4. REPRESENTATIONS AND WARRANTIES 38
4.1. Subsidiaries 38
4.2. Existence and Power 38
4.3. Authority; Enforceability 39
4.4. Required Consents 39
4.5. No Conflicting Agreements, Compliance with
Laws; Taxes 39
4.6. Franchises, Licenses, Etc. 39
4.7. Investment Company Act 39
4.8. Public Utility Status 40
4.9. Federal Reserve Regulations; Use of Loan
Proceeds 40
4.10. Litigation 40
4.11. Financial Statements 40
4.12. Plans 41
4.13. Ownership of Property; Liens 41
4.14. Security Interests 41
4.15. Environmental Matters 41
4.16. Certain Business Activities 42
5. CONDITIONS TO FIRST LOANS OR THE ISSUANCE OF FIRST
LETTERS OF CREDIT 42
5.1. Evidence of Action 42
5.2. This Agreement; Notes 42
5.3. Certificate as to Approvals and Liens 42
5.4. Pledge Agreement 43
5.5. Facility A Loan Documents 43
5.6. Other Credit Facilities 43
5.7. ACE Preferred Stock 43
5.8. Opinions of Counsel 43
5.9. Opinion of Special Counsel 43
5.10. Fees 44
6. CONDITIONS OF LENDING - ALL LOANS AND LETTERS OF
CREDIT 44
6.1. Compliance 44
6.2. Borrowing Request; Competitive Bid Request 44
6.3. Letter of Credit Request 44
7. AFFIRMATIVE COVENANTS 44
7.1. Financial Statements 45
7.2. Certificates; Other Information 45
7.3. Legal Existence 46
7.4. Taxes 46
7.5. Insurance 46
7.6. Condition of Property 46
7.7. Observance of Legal Requirements 47
7.8. Inspection of Property; Books and Records;
Discussions 47
7.9. Licenses, Franchises, Intellectual Property,
Etc. 47
7.10. Indebtedness Capitalization Ratio 47
7.11. Ratio of Indebtedness to Annualized ACE
Dividends 47
8. NEGATIVE COVENANTS 47
8.1. Indebtedness 47
8.2. Liens 48
8.3. Merger; Consolidation 48
8.4. Restricted Payments 49
8.5. Investments, Acquisitions, Loans, Etc. 49
8.6. Amendments, Etc. of Intercompany Notes 50
8.7. Designation of Operating Subsidiaries 51
8.8. Certain Business Activities 51
9. DEFAULT 51
9.1. Events of Default 51
10. THE AGENT 54
10.1. Appointment 54
10.2. Delegation of Duties 54
10.3. Exculpatory Provisions 54
10.4. Reliance by Agent 55
10.5. Notice of Default 55
10.6. Non-Reliance on Agent and Other Lenders 56
10.7. Indemnification 56
10.8. Agent in Its Individual Capacity 57
10.9. Successor Agent 57
11. OTHER PROVISIONS 58
11.1. Amendments and Waivers 58
11.2. Notices 58
11.3. No Waiver; Cumulative Remedies 59
11.4. Survival of Representations and Warranties 60
11.5. Payment of Expenses and Taxes 60
11.6. Lending Offices 60
11.7. Assignments and Participations 61
11.8. Counterparts 62
11.9. Adjustments; Set-off 63
11.10 Indemnity 64
11.11. Governing Law 64
11.12. Headings Descriptive 64
11.13. Severability 64
11.14. Integration 65
11.15. Consent to Jurisdiction 65
11.16. Service of Process 65
11.17. No Limitation on Service or Suit 65
11.18. WAIVER OF TRIAL BY JURY 65
EXHIBITS
Exhibit A List of Commitments
Exhibit B-1 Form of Revolving Credit Note
Exhibit B-2 Form of Competitive Bid Note
Exhibit C Form of Borrowing Request
Exhibit D Form of Competitive Bid Request
Exhibit E Form of Invitation to Bid
Exhibit F Form of Competitive Bid
Exhibit G Form of Competitive Bid Accept/Reject Letter
Exhibit H Form of Competitive Bid Loan Confirmation
Exhibit I Form of Notice of Conversion/Continuation
Exhibit J Form of Letter of Credit Request
Exhibit K Form of Compliance Certificate
Exhibit L Form of Pledge Agreement
Exhibit M Form of Intercompany Note
Exhibit N Form of Opinion of Counsel to the Borrower
Exhibit O Form of Opinion of Special Counsel
Exhibit P Form of Assignment and Acceptance Agreement
Exhibit Q Form of Guaranty
SCHEDULES
Schedule 1.1 List of Lending Offices
Schedule 4.1 List of Subsidiaries
Schedule 4.1 List of Existing Pension Plans
Schedule 8.1 List of Existing Indebtedness
Schedule 8.2 List of Existing Liens
Schedule 8.5 List of Existing Investments
REVOLVING CREDIT AGREEMENT (FACILITY B), dated as of September 28,
1995, by and among ATLANTIC ENERGY, INC., a New Jersey corporation (the
"Borrower"), the lenders party hereto (together with their respective
assigns, the "Lenders", each a "Lender") and THE BANK OF NEW YORK, as
agent for the Lenders (in such capacity, the "Agent").
A. DEFINITIONS AND PRINCIPLES OF CONSTRUCTION
1. Definitions
As used in this Agreement, terms defined in the preamble
have the meanings therein indicated, and the following terms have the
following meanings:
"ABR Advances": the Revolving Credit Loans (or any
portions thereof) at such time as they (or such portions) are made
and/or being maintained at a rate of interest based upon the Alternate
Base Rate.
"ACE": Atlantic City Electric Company, a New Jersey
corporation and a wholly owned Subsidiary of the Borrower.
"ACE Preferred Stock": the Cumulative Preferred Stock,
$100 par value, the No Par Preferred Stock and the Preference Stock, No
Par Value of ACE outstanding from time to time.
"Accountants": Deloitte & Touche LLP (or any successor
thereto), or such other firm of certified public accountants of
recognized national standing selected by the Borrower.
"Acquisition": the acquisition of a business by the
Borrower or any of its Subsidiaries through either a merger with another
Person or the purchase of all or substantially all of the capital Stock
of another Person or all or substantially all of the assets of another
Person or of a division of another Person.
"Accumulated Funding Deficiency": as defined in Section
302 of ERISA.
"Advance": with respect to a Revolving Credit Loan, an
ABR Advance or a Eurodollar Advance, as the case may be.
"Affected Advance": as defined in Section 2.9.
"Affiliate": as to any Person, any other Person which,
directly or indirectly, is in control of, is controlled by, or is under
common control with, such Person. For purposes of this definition,
control of a Person shall mean the power, direct or indirect, (i) to
vote 5% or more of the securities or other interests having ordinary
voting power for the election of directors or other managing Persons
thereof or (ii) to direct or cause the direction of the management and
policies of such Person, whether by contract or otherwise.
"Aggregate Commitments": on any date, the sum of all
Commitments on such date.
"Aggregate Credit Exposure": as of any date of
determination, the sum of (i) the aggregate outstanding principal
balance of all Revolving Credit Loans and Competitive Bid Loans of all
Lenders, plus (ii) an amount equal to Letter of Credit Exposure of all
Lenders.
"Aggregate Facility A Commitments": the aggregate of the
Facility A Commitments of the Facility A Lenders.
"Agreement": this Revolving Credit Agreement (Facility
B), as the same may be amended, supplemented or otherwise modified from
time to time.
"Alternate Base Rate": on any date, a rate of interest
per annum equal to the higher of (i) the Federal Funds Rate in effect on
such date plus 1/2 of 1% or (ii) the BNY Rate in effect on such date.
"Annualized ACE Dividends": at any date of determination,
an amount equal to (i) the amount of dividends paid to the Borrower by
ACE during the fiscal quarter ending on such date of determination or,
if such date of determination is not a fiscal quarter ending date, the
immediately preceding fiscal quarter, multiplied by (ii) four.
"Applicable Fee Percentage": with respect to the amount
of the Aggregate Commitments, at all times during which the applicable
Pricing Level set forth below is in effect, the percentage set forth
below next to such Pricing Level, subject to the provisos set forth
below:
Applicable
Pricing Level Fee Percentage
Pricing Level I 0.150%
Pricing Level II 0.175%
Pricing Level III 0.200%
Pricing Level IV 0.250%
provided that (i) changes in the Applicable Fee Percentage resulting
from a change in the Pricing Level shall become effective on the
effective date of any change in the Senior Debt Rating by Moody's or S&P
and (ii) in the event of a split in ratings resulting in the Senior Debt
Rating by S&P and Moody's falling within different Pricing Levels, the
Applicable Fee Percentage shall be the lower percentage.
"Applicable Lending Office": in respect of any Lender,
(i) in the case of such Lender's ABR Advances and Competitive Bid Loans,
its Domestic Lending Office and (ii) in the case of such Lender's
Eurodollar Advances, its Eurodollar Lending Office.
"Applicable Margin": with respect to (i) the unpaid
principal amount of Eurodollar Advances, and (ii) the daily amount
available to be drawn under each Letter of Credit in the case of the
Letter of Credit Fees, in each case at all times during which the
applicable Pricing Level set forth below is in effect, the percentage
set forth below next to such Pricing Level, subject to the provisos set
forth below:
Pricing Level Applicable Margin
Pricing Level I 0.275%
Pricing Level II 0.300%
Pricing Level III 0.400%
Pricing Level IV 0.500%
provided that (i) changes in the Applicable Margin resulting from a
change in the Pricing Level shall become effective on the effective date
of any change in the Senior Debt Rating by Moody's or S&P and (ii) in
the event of a split in ratings resulting in the Senior Debt Rating by
each of S&P and Moody's falling within different Pricing Levels, the
Applicable Margin shall be the lower percentage.
"Approved Financial Institutions": collectively, (i) each Lender,
(ii) those major United States and foreign commercial banks with which
the Borrower or its affiliates have formal line-of-credit relationships
as of the Effective Date, (iii) domestic branches of major Canadian
banks and (iv) such other banks as appropriate officers of the Borrower
may deem appropriate and with respect to which the Agent shall have
received advance written notice.
"Assignment and Acceptance Agreement": an assignment and
acceptance agreement executed by an assignor and an assignee pursuant to
which the assignor assigns to the assignee all or any portion of such
assignor's (i) Notes, (ii) Commitment, (iii) Facility A Notes and (iv)
Facility A Commitment, substantially in the form of Exhibit P.
"Assignment Fee": as defined in Section 11.7(b).
"Atlantic Thermal": Atlantic Thermal Systems, Inc., a New Jersey
corporation and a wholly owned Subsidiary of the Borrower.
"ATE": ATE Investment, Inc., a New Jersey corporation and a
wholly owned Subsidiary of the Borrower.
"ATE Credit Agreement": the Revolving Credit and Term Loan
Agreement, dated as of May 24, 1988, as amended, between ATE and BNY.
"Authorized Signatory": as to (i) any Person which is a
corporation, the chairman of the board, the president, any vice
president, the chief financial officer or any other duly authorized
officer (acceptable to the Agent) of such Person and (ii) any Person
which is not a corporation, the general partner or other managing Person
thereof.
"Benefited Lender": as defined in Section 11.9.
"Bid Rate": as defined in Section 2.4(b).
"BNY": The Bank of New York.
"BNY Rate": a rate of interest per annum equal to the rate of
interest publicly announced in New York City by BNY from time to time as
its prime commercial lending rate, such rate to be adjusted
automatically (without notice) on the effective date of any change in
such publicly announced rate.
"Borrowing Date": any Business Day on which (i) the Lenders make
Revolving Credit Loans in accordance with a Borrowing Request, (ii) one
or more Lenders make Competitive Bid Loans pursuant to Competitive Bids
which have been accepted by the Borrower or (iii) the Issuing Bank
issues a Letter of Credit.
"Borrowing Request": a request for Revolving Credit Loans in the
form of Exhibit C.
"Business Day": any day other than a Saturday, a Sunday or a day
on which commercial banks located in New York City are authorized or
required by law or other governmental action to close.
"Capital Lease Obligations": with respect to any Person,
obligations of such Person with respect to leases which, in accordance
with GAAP, are required to be capitalized on the financial statements of
such Person.
"Change in Control": either (i) any "person" or "group" (within
the meaning of Sections 13(d) and 14(d)(2) of the Exchange Act) becoming
the "beneficial owner" (as defined in Rule 13d-3 under the Exchange Act)
of shares of capital Stock of the Borrower entitled to exercise more
than 50% of the total voting power of all outstanding shares of capital
Stock, unless such beneficial ownership is approved by the board of
directors of the Borrower prior to the acquisition; or (ii) a majority
of the board of directors of the Borrower are not Continuing Directors.
"Code": the Internal Revenue Code of 1986, as the same may be
amended from time to time, or any successor thereto, and the rules and
regulations issued thereunder, as from time to time in effect.
"Collateral": collectively, the collateral under and as defined
in the Pledge Agreement.
"Commitment": in respect of any Lender, such Lender's undertaking
during the Commitment Period to make Revolving Credit Loans, subject to
the terms and conditions hereof, in an aggregate outstanding principal
amount not exceeding the amount set forth next to the name of such
Lender in Exhibit A under the heading "Commitment", as the same may be
reduced pursuant to Section 2.5.
"Commitment Period": the period from the Effective Date until the
day before the Maturity Date.
"Commitment Percentage": as to any Lender, the percentage set
forth opposite the name of such Lender in Exhibit A under the heading
"Commitment Percentage".
"Competitive Bid": an offer by a Lender, in the form of Exhibit
F, to make a Competitive Bid Loan.
"Competitive Bid Accept/Reject Letter": a notification given by
the Borrower pursuant to Section 2.4 in the form of Exhibit G.
"Competitive Bid Loan": each Loan from a Lender to the Borrower
pursuant to Section 2.4.
"Competitive Bid Loan Confirmation": a confirmation by the Agent
to a Lender of the acceptance by the Borrower of any Competitive Bid (or
Portion thereof) made by such Lender, substantially in the form of
Exhibit H.
"Competitive Bid Note" and "Competitive Bid Notes": as defined in
Section 2.4(g).
"Competitive Bid Request": a request by the Borrower, in the form
of Exhibit D, for Competitive Bids.
"Competitive Interest Period": with respect to any Competitive
Bid Loan, the period commencing on the date of such Competitive Bid Loan
and ending on the date requested in the Competitive Bid Request with
respect to such Competitive Bid Loan, which date shall not be earlier
than 7 days after the date of such Competitive Bid Loan or later than
180 days after the date of such Competitive Bid Loan; provided, however,
that if any Competitive Interest Period would end on a day other than a
Business Day, such Interest Period shall be extended to the next
succeeding Business Day, unless such next succeeding Business Day would
be a date on or after the Maturity Date, in which case such Competitive
Interest Period shall end on the next preceding Business Day, and
provided further that no Competitive Interest Period shall end after the
Maturity Date. Interest shall accrue from and including the first day
of a Competitive Interest Period to but excluding the last day of such
Competitive Interest Period.
"Compliance Certificate": a certificate in the form of Exhibit K.
"Consenting Lenders": as defined in Section 2.22(b).
"Consolidated": the Borrower and its Subsidiaries which are
consolidated for financial reporting purposes.
"Consolidated Total Indebtedness": at any date of determination,
total Indebtedness of the Borrower and its Subsidiaries determined on a
Consolidated basis in accordance with GAAP.
"Consolidated Total Capitalization": at any date of determination
with respect to the Borrower and its Subsidiaries on a Consolidated
basis in accordance with GAAP, the sum of (i) the amount classified as
common shareholders equity for purposes of balance sheet presentation in
accordance with GAAP, plus (ii) the amount classified as preferred stock
for purposes of balance sheet presentation in accordance with GAAP, plus
(iii) all Indebtedness (net of unamortized premium and discount), less
(iv) unamortized capital Stock expense.
"Contingent Obligation": as to any Person (the "secondary
obligor"), any obligation of such secondary obligor (i) guaranteeing or
in effect guaranteeing any return on any investment made by another
Person, or (ii) guaranteeing or in effect guaranteeing any Indebtedness,
lease, dividend or other monetary obligation ("primary obligation") of
any other Person (the "primary obligor") in any manner, whether directly
or indirectly, including, without limitation, any obligation of such
secondary obligor, whether contingent, (A) to purchase any such primary
obligation or any Property constituting direct or indirect security
therefor, (B) to advance or supply funds (x) for the purchase or payment
of any such primary obligation or (y) to maintain working capital or
equity capital of the primary obligor or otherwise to maintain the net
worth or solvency of the primary obligor, (C) to purchase Property,
securities or services primarily for the purpose of assuring the
beneficiary of any such primary obligation of the ability of the primary
obligor to make payment of such primary obligation, (D) otherwise to
assure or hold harmless the beneficiary of such primary obligation
against loss in respect thereof, and (E) in respect of the liabilities
of any partnership in which such secondary obligor is a general partner,
except to the extent that such liabilities of such partnership are
nonrecourse to such secondary obligor and its separate Property,
provided, however, that the term "Contingent Obligation" shall not
include the indorsement of instruments for deposit or collection in the
ordinary course of business. The amount of any Contingent Obligation of
a Person shall be deemed to be an amount equal to the stated or
determinable amount of the primary obligation in respect of which such
Contingent Obligation is made or, if not stated or determinable, the
maximum reasonably anticipated liability in respect thereof as
determined by such Person in good faith.
"Continuing Director": at any date of determination, a member of
the board of directors of the Borrower who (i) was a member of such
board for the prior of 24 months prior to such date or (ii) was
nominated for election or elected to such board with the affirmative
vote of at least two-thirds of the Continuing Directors.
"Control Person": as defined in Section 2.16.
"Conversion/Continuation Date": the date on which (i) a
Eurodollar Advance is converted to an ABR Advance, (ii) the date on
which an ABR Advance is converted to a Eurodollar Advance or (iii) the
date on which a Eurodollar Advance is continued as a new Eurodollar
Advance.
"Credit Exposure": with respect to any Lender as of any date, the
sum as of such date of (i) the outstanding principal balance of such
Lender's Revolving Credit Loans, plus (ii) an amount equal to such
Lender's Letter of Credit Exposure.
"Default": any event or condition which constitutes an Event of
Default or which, with the giving of notice, the lapse of time, or any
other condition, would, unless cured or waived, become an Event of
Default.
"District Heating and Cooling Project": a proposed centralized
steam and chilled water production facility located in Atlantic City,
New Jersey.
"Dollars" and "$": lawful currency of the United States of
America.
"Domestic Lending Office": in respect of any Lender, initially,
the office or offices of such Lender designated as such on Schedule 1.1;
thereafter, such other office of such Lender through which it shall be
making or maintaining ABR Advances or Competitive Bid Loans, as reported
by such Lender to the Agent and the Borrower, provided that any Lender
may so report different Domestic Lending Offices for all of its ABR
Advances and all of its Competitive Bid Loans, whereupon references to
the Domestic Lending Office of such Lender shall mean either or both of
such offices, as applicable.
"Effective Date": September 28, 1995.
"Employee Benefit Plan": an employee benefit plan within the
meaning of Section 3(3) of ERISA maintained, sponsored or contributed to
by the Borrower, any of its Subsidiaries or any ERISA Affiliate.
"Environmental Laws": any and all federal, state and local laws
relating to the environment, the use, storage, transporting,
manufacturing, handling, discharge, disposal or recycling of hazardous
substances, materials or pollutants or industrial hygiene, and
including, without limitation, (i) the Comprehensive Environmental
Response, Compensation and Liability Act, as amended, 42 USCA 9601 et
seq.; (ii) the Resource Conservation and Recovery Act of 1976, as
amended, 42 USCA 6901 et seq.; (iii) the Toxic Substance Control Act,
as amended, 15 USCA 2601 et seq.; (iv) the Water Pollution Control Act,
as amended, 33 USCA 1251 et seq.; (v) the Clean Air Act, as amended, 42
USCA 7401 et seq.; (vi) the Hazardous Material Transportation
Authorization Act of 1994, as amended, 49 USCA 5101 et seq. and (viii)
all rules, regulations, judgments, decrees, injunctions and restrictions
thereunder and any analogous state law.
"ERISA": the Employee Retirement Income Security Act of 1974, as
amended from time to time, and the rules and regulations issued
thereunder, as from time to time in effect.
"ERISA Affiliate": when used with respect to an Employee Benefit
Plan, ERISA, the PBGC or a provision of the Code pertaining to employee
benefit plans, any Person that is a member of any group of organizations
within the meaning of Sections 414(b) or (c) of the Code (or, solely for
purposes of potential liability under Section 302(c)(11) of ERISA and
Section 412(c)(11) of the Code and the lien created under Section 302(f)
of ERISA and Section 412(n) of the Code, Sections 414(m) or (o) of the
Code) of which the Borrower or any of its Subsidiaries is a member.
"Eurodollar Advances": collectively, the Revolving Credit Loans
(or any portions thereof) at such time as they (or such portions) are
made and/or being maintained at a rate of interest based upon the
Eurodollar Rate.
"Eurodollar Interest Period": with respect to any Eurodollar
Advance requested by the Borrower, the period commencing on, as the case
may be, the Borrowing Date or Conversion/Continuation Date with respect
to such Eurodollar Advance and ending one, two, three or six months
thereafter, as selected by the Borrower in its irrevocable Borrowing
Request or its irrevocable Notice of Conversion/Continuation, provided,
however, that (i) if any Eurodollar Interest Period would otherwise end
on a day which is not a Business Day, such Eurodollar Interest Period
shall be extended to the next succeeding Business Day unless the result
of such extension would be to carry such Interest Period into another
calendar month, in which event such Eurodollar Interest Period shall end
on the immediately preceding Business Day, (ii) any Eurodollar Interest
Period that begins on the last Business Day of a calendar month (or on a
day for which there is no numerically corresponding day in the calendar
month at the end of such Eurodollar Interest Period) shall end on the
last Business Day of a calendar month and (iii) the Borrower shall
select Interest Periods so as not to have more than four different
Eurodollar Interest Periods outstanding at any one time for all
Eurodollar Advances.
"Eurodollar Lending Office": in respect of any Lender, initially,
the office, branch or affiliate of such Lender designated as such on
Schedule 1.1 (or, if no such office branch or affiliate is specified,
its Domestic Lending Office); thereafter, such other office, branch or
affiliate of such Lender through which it shall be making or maintaining
Eurodollar Advances, as reported by such Lender to the Agent and the
Borrower.
"Eurodollar Rate": with respect to the Eurodollar Interest Period
applicable to any Eurodollar Advance, a rate of interest per annum, as
determined by the Agent, obtained by dividing (and then rounding to the
nearest 1/16 of 1% or, if there is no nearest 1/16 of 1%, then to the
next higher 1/16 of 1%):
(a) the rate, as reported by BNY to the Agent, quoted by
BNY to leading banks in the interbank eurodollar market as the rate at
which BNY is offering Dollar deposits in an amount equal approximately
to the Eurodollar Advance of BNY to which such Interest Period shall
apply for a period equal to such Interest Period, as quoted at
approximately 11:00 a.m. two Business Days prior to the first day of
such Interest Period, by
(b) a number equal to 1.00 minus the aggregate of the then
stated maximum rates during such Interest Period of all reserve
requirements (including, without limitation, marginal, emergency,
supplemental and special reserves), expressed as a decimal, established
by the Board of Governors of the Federal Reserve System and any other
banking authority to which BNY and other major United States money
center banks are subject, in respect of eurocurrency funding (currently
referred to as "Eurocurrency liabilities" in Regulation D of the Board
of Governors of the Federal Reserve System) or in respect of any other
category of liabilities including deposits by reference to which the
interest rate on Eurodollar Advances is determined or any category of
extensions of credit or other assets which includes loans by non-
domestic offices of any Lender to United States Residents. Such reserve
requirements shall include, without limitation, those imposed under such
Regulation D. Eurodollar Advances shall be deemed to constitute
Eurocurrency liabilities and as such shall be deemed to be subject to
such reserve requirements without benefit of credits for proration,
exceptions or offsets which may be available from time to time to any
Lender under such Regulation D. The Eurodollar Rate shall be adjusted
automatically on and as of the effective date of any change in any such
reserve requirement.
"Event of Default": any of the events specified in Section 9.1,
provided that any requirement for the giving of notice, the lapse of
time, or any other condition has been satisfied.
"Exchange Act": the Securities and Exchange Act of 1934, as
amended.
"Existing Pension Plans": as defined in Section 4.12.
"Extension Consent Period": the period which is less than 35
days, but equal to or greater than 30 days, prior to the then current
Maturity Date (provided, however, that if such 30th prior day falls on a
day that is not a Business Day, such date shall be extended to the next
following Business Day).
"Extension Consent Required Lenders": Lenders having at least
66 2/3% of the Aggregate Commitments (without giving effect to any Loans
outstanding).
"Extension Request": as defined in Section 2.22.
"Facility A": the $35,000,000 senior 364-day revolving credit
facility established pursuant to the Facility A Loan Documents.
"Facility A Agent": The Bank of New York, in its capacity as
agent for the Facility A Lenders under the Facility A Loan Documents.
"Facility A Commitment": in respect of any Facility A Lender,
such Facility A Lender's undertaking during the Commitment Period (as
defined in the Facility A Credit Agreement) to make Facility A Loans, in
an amount not in excess, and subject to the terms and conditions, of the
Facility A Credit Agreement.
"Facility A Commitment Percentage": as to any Facility A Lender,
such Facility A Lender's Commitment Percentage as defined in the
Facility A Credit Agreement.
"Facility A Credit Agreement": the Revolving Credit Agreement
(Facility A), dated as of the date hereof, among the Borrower, the
Facility A Agent and the Facility A Lenders, as the same may be amended,
supplemented or otherwise modified from time to time.
"Facility A Lenders": the Lenders party to the Facility A Loan
Documents.
"Facility A Loan Documents": collectively, the Facility A Credit
Agreement, the Facility A Notes and the Pledge Agreement.
"Facility A Maturity Date": the maturity date under the Facility
A Credit Agreement, as from time to time extended pursuant thereto.
"Facility A Notes": collectively, (i) the Revolving Credit Notes
(Facility A) and (ii) the Competitive Bid Notes (Facility A) made by the
Borrower pursuant to the Facility A Credit Agreement, as indorsed or
modified from time to time.
"Facility Fee": as defined in Section 3.1.
"Federal Funds Rate": for any day, a rate per annum (expressed as
a decimal, rounded upwards, if necessary, to the next higher 1/100 of
1%), equal to the weighted average of the rates on overnight federal
funds transactions with members of the Federal Reserve System arranged
by federal funds brokers on such day, as published by the Federal
Reserve Bank of New York on the Business Day next succeeding such day,
provided that (i) if the day for which such rate is to be determined is
not a Business Day, the Federal Funds Rate for such day shall be such
rate on such transactions on the next preceding Business Day as so
published on the next succeeding Business Day, and (ii) if such rate is
not so published for any day, the Federal Funds Rate for such day shall
be the average of the quotations for such day on such transactions
received by BNY as determined by BNY and reported to the Agent.
"Financial Statements": as defined in Section 4.11.
"GAAP": generally accepted accounting principles set forth in the
opinions and pronouncements of the Accounting Principles Board and the
American Institute of Certified Public Accountants and in the statements
and pronouncements of the Financial Accounting Standards Board or in
such other statement by such other entity as may be approved by a
significant segment of the accounting profession, which are applicable
to the circumstances as of the date of determination, consistently
applied. If at any time any change in GAAP would affect the computation
of any financial ratio or requirement set forth in this Agreement, the
Agent, the Lenders and the Borrower shall negotiate in good faith to
amend such ratio or requirement to reflect such change in GAAP (subject
to the approval of the Required Lenders), provided that, until so
amended, (i) such ratio or requirement shall continue to be computed in
accordance with GAAP prior to such change therein and (ii) the Borrower
shall provide to the Agent and the Lenders financial statements and
other documents required under this Agreement or as reasonably requested
hereunder setting forth a reconciliation between calculations of such
ratio or requirement made before and after giving effect to such change
in GAAP.
"Governmental Authority": any nation or government, any state or
other political subdivision thereof, any entity exercising executive,
legislative, judicial, regulatory or administrative functions of or
pertaining to government and any court or arbitrator.
"Highest Lawful Rate": as to any Lender or the Issuing Bank, the
maximum rate of interest, if any, that at any time or from time to time
may be contracted for, taken, charged or received by such Lender on the
Notes or by the Issuing Bank on the Reimbursement Agreements held
thereby, as the case may be, or which may be owing to such Lender or the
Issuing Bank pursuant the Loan Documents under the laws applicable to
such Lender or the Issuing Bank and this transaction.
"Indebtedness": as to any Person, at a particular time, all items
which constitute, without duplication, (i) indebtedness for borrowed
money or the deferred purchase price of Property (other than trade
payables incurred in the ordinary course of business), (ii) indebtedness
evidenced by notes, bonds, debentures or similar instruments, (iii)
obligations with respect to any conditional sale or title retention
agreement, (iv) indebtedness arising under acceptance facilities and the
amount available to be drawn under all letters of credit (other than
trade letters of credit) issued for the account of such Person and,
without duplication, all drafts drawn thereunder to the extent such
Person shall not have reimbursed the issuer in respect of the issuer's
payment of such drafts, (v) all liabilities secured by any Lien on any
Property owned by such Person even though such Person has not assumed
or otherwise become liable for the payment thereof (other than (1)
carriers', warehousemen's, mechanics', repairmen's or other like non-
consensual statutory Liens arising in the ordinary course of business
and (2) liabilities of Subsidiaries (other than ACE and Operating
Subsidiaries) for which recourse may be had by the creditor only to the
Property secured by the Lien), (vi) Capital Lease Obligations and (vii)
Contingent Obligations.
"Indebtedness Capitalization Ratio": the ratio of (i)
Consolidated Total Indebtedness to (ii) Consolidated Total
Capitalization.
"Indemnified Person": as defined in Section 11.10.
"Intercompany Loans": loans from time to time made by the
Borrower to an Operating Subsidiary.
"Intercompany Note": a promissory note made by an Operating
Subsidiary to the Borrower evidencing the Intercompany Loans made by the
Borrower to such Operating Subsidiary, substantially in the form of
Exhibit M, as the same may be amended, modified or supplemented.
"Interest Payment Date": (i) as to any ABR Advance, the last day
of each March, June, September and December commencing on the first of
such days to occur after such ABR Advance is made or any Eurodollar
Advance is converted to an ABR Advance, (ii) as to any Eurodollar
Advance in respect of which the Borrower has selected a Eurodollar
Interest Period of one, two or three months, the last day of such
Interest Period, (iii) as to any Eurodollar Advance in respect of which
the Borrower has selected a Eurodollar Interest Period of six months,
the day which is three months after the first day of such Interest
Period and the last day of such Interest Period, (iv) as to any
Competitive Bid Loan as to which the Borrower has selected an Interest
Period of 90 days or less, the last day of such Competitive Interest
Period, and (v) as to any Competitive Bid Loan as to which the Borrower
has selected a Competitive Interest Period of more than 90 days, the day
which is 90 days after the first day of such Competitive Interest Period
and the last day of such Competitive Interest Period.
"Interest Period": a Eurodollar Interest Period or a Competitive
Interest Period, as the context may require.
"Investments": as defined in Section 8.5.
"Invitation to Bid": an invitation to make Competitive Bids in
the form of Exhibit E.
"Issuing Bank": The Bank of New York.
"Letter of Credit": as defined in Section 2.18.
"Letter of Credit Fees": as defined in Section 3.2.
"Letter of Credit Commitment": the commitment of the Issuing Bank
to issue Letters of Credit having an aggregate outstanding face amount
up to $10,000,000, and the commitment of the Lenders to participate in
the Letter of Credit Exposure as set forth in Section 2.19.
"Letter of Credit Exposure": at any date, (i) in respect of all
the Lenders, the sum, without duplication, of (x) the aggregate undrawn
face amount of the outstanding Letters of Credit at such date, (y) the
aggregate amount of unpaid drafts drawn on all Letters of Credit at such
date, and (z) the aggregate unpaid reimbursement obligations in respect
of the Letters of Credit at such date (after giving effect to any Loans
made on such date to pay any such reimbursement obligations), and (ii)
in respect of any Lender, an amount equal to such Lender's Commitment
Percentage multiplied by the amount determined under clause (i) of this
definition.
"Letter of Credit Request": a request in the form of Exhibit J.
"Lien": any mortgage, pledge, hypothecation, assignment, deposit
or preferential arrangement, encumbrance, lien (statutory or other), or
other security agreement or security interest of any kind or nature
whatsoever, including, without limitation, any conditional sale or other
title retention agreement and any capital or financing lease having
substantially the same economic effect as any of the foregoing.
"Loan Documents": collectively, this Agreement, the Notes, the
Pledge Agreement and the Reimbursement Agreements.
"Loans": the Revolving Credit Loans and/or the Competitive Bid
Loans, as the case may be.
"Margin Stock": any "margin stock", as defined in Regulation U of
the Board of Governors of the Federal Reserve System, as the same may be
amended or supplemented from time to time.
"Material Adverse Change": a material adverse change in (i) the
financial condition, operations, business or Property of the Borrower
and its Subsidiaries taken as a whole or (ii) the ability of the
Borrower to perform its obligations under the Loan Documents.
"Material Adverse Effect": a material adverse effect on (i) the
financial condition, operations, business or Property of the Borrower
and its Subsidiaries taken as a whole or (ii) the ability of the
Borrower to perform its obligations under the Loan Documents.
"Maturity Date": September 27, 1998, or any date subsequent
thereto resulting from an extension of the Maturity Date pursuant to
Section 2.22, or such earlier date on which the Notes shall become due
and payable, whether by acceleration or otherwise.
"Maximum Offer": as defined in Section 2.4(b).
"Maximum Request": as defined in Section 2.4(a).
"Moody's": Moody's Investors Service, Inc., or any successor
thereto.
"Multiemployer Plan": a Pension Plan which is a multiemployer
plan as defined in Section 4001(a)(3) of ERISA.
"Nonconsenting Lender": as defined in Section 2.22.
"Note": a Revolving Credit Note or a Competitive Bid Note, as the
case may be.
"Notes": the Revolving Credit Notes and/or the Competitive Bid
Notes, as the case may be.
"Notice of Conversion/Continuation": a notice substantially in
the form of Exhibit I.
"Operating Subsidiaries": collectively (i) Atlantic Generation,
Inc., (ii) ATE, (iii) Atlantic Thermal, (iv) Atlantic Jersey Thermal
Systems, Inc., (v) Atlantic Energy Technologies, Inc. and (vi) and each
other Subsidiary of the Borrower engaged in the conduct of an active
trade or business which is designated as an Operating Subsidiary
pursuant to Section 8.7.
"PBGC": the Pension Benefit Guaranty Corporation established
pursuant to Subtitle A of Title IV of ERISA, or any Governmental
Authority succeeding to the functions thereof.
"Pension Plan": at any date of determination, any Employee
Benefit Plan (including a Multiemployer Plan), the funding requirements
of which (under Section 302 of ERISA or Section 412 of the Code) are, or
at any time within the six years immediately preceding such date, were
in whole or in part, the responsibility of the Borrower, any of its
Subsidiaries or any ERISA Affiliate.
"Permitted Investments": Investments permitted under Section 8.5.
"Permitted Liens": Liens permitted to exist under Section 8.2.
"Permitted Recipient": a Person in which the Borrower owns 50% or
less of the Stock or voting power.
"Permitted Recipient Loans": loans from time to time made to a
Permitted Recipient by the Borrower to the extent permitted by Section
8.5.
"Person": any individual, firm, partnership, joint venture,
corporation, association, business enterprise, limited liability
company, joint stock company, unincorporated association, trust,
Governmental Authority or any other entity, whether acting in an
individual, fiduciary, or other capacity, and for the purpose of the
definition of "ERISA Affiliate", a trade or business.
"Pledge Agreement": the Pledge Agreement, made by the Borrower in
favor of the Agent, as collateral agent for itself, the Lenders, the
Facility A Agent and the Facility A Lenders, substantially in the form
of Exhibit L, as the same may be amended, supplemented or otherwise
modified from time to time.
"Portion": as defined in Section 2.4(b).
"Pricing Level I": any time when the Senior Debt Rating is (i) A-
or higher by S&P or (ii) A3 or higher by Moody's, provided, however,
that in the event that (x) the Senior Debt Rating is not available from
either S&P or Moody's, such rating agency shall be deemed to have
assigned its lowest rating and (y) the Senior Debt Rating is not
available from both S&P and Moody's, Pricing Level IV shall be
applicable.
"Pricing Level II": any time when (i) the Senior Debt Rating is
(a) BBB or higher by S&P or (b) Baa2 or higher by Moody's and (ii)
Pricing Level I does not apply, provided, however, that in the event
that (x) the Senior Debt Rating is not available from either S&P or
Moody's, such rating agency shall be deemed to have assigned its lowest
rating and (y) the Senior Debt Rating is not available from both S&P and
Moody's, Pricing Level IV shall be applicable.
"Pricing Level III": any time when (i) the Senior Debt Rating is
(a) BBB- or higher by S&P or (b) Baa3 or higher by Moody's and (ii)
Pricing Levels I and II do not apply, provided, however, that in the
event that (x) the Senior Debt Rating is not available from either S&P
or Moody's, such rating agency shall be deemed to have assigned its
lowest rating and (y) the Senior Debt Rating is not available from both
S&P and Moody's, Pricing Level IV shall be applicable.
"Pricing Level IV": any time when Pricing Levels I, II and III do
not apply.
"Prohibited Transaction": a transaction that is prohibited under
Section 4975 of the Code or Section 406 of ERISA and not exempt under
Section 4975 of the Code or Section 408 of ERISA.
"Property": all types of real, personal, tangible, intangible or
mixed property.
"Real Property": all real property owned or leased (or previously
owned or leased) by the Borrower or any of its Subsidiaries (or any of
their respective predecessors).
"Reimbursement Agreement": as defined in Section 2.18(b).
"Replacement Lender": as defined in Section 2.22.
"Reportable Event": with respect to any Pension Plan, (i) any
event set forth in Sections 4043(b) (other than a Reportable Event as to
which the 30 day notice requirement is waived by the PBGC under
applicable regulations), 4062(c) or 4063(a) of ERISA or the regulations
thereunder, (ii) an event requiring the Borrower, any of its
Subsidiaries or any ERISA Affiliate to provide security to a Pension
Plan under Section 401(a)(29) of the Code, or (iii) any failure to make
any payment required by Section 412(m) of the Code.
"Required Lenders": (i) if the Commitments exist and no Revolving
Credit Loans or Letters of Credit are outstanding, Lenders having
Commitments equal to at least 66-2/3% of the sum of the Aggregate
Commitments; (ii) if the Commitments exist and Revolving Credit Loans or
Letters of Credit are outstanding, Lenders holding Revolving Credit
Notes and participation interests in Letters of Credit having an
aggregate unpaid principal balance and Letter of Credit Exposure equal
to at least 66-2/3% of the aggregate of Revolving Credit Loans
outstanding and Letter of Credit Exposure; and (iii) if the Commitments
have been terminated or otherwise no longer exist, Lenders holding Notes
and participation interests in Letters of Credit having an aggregate
unpaid principal balance and Letter of Credit Exposure equal to at least
66-2/3% of the aggregate of Loans outstanding and Letter of Credit Exposure.
"Restricted Payment": as to any Person (i) any dividend or other
distribution, direct or indirect, on account of any shares of any class
of Stock or other equity interest in such Person now or hereafter
outstanding (other than a dividend payable solely in shares of such
Stock to the holders of such shares) and (ii) any redemption,
retirement, sinking fund or similar payment, purchase or other
acquisition, direct or indirect, of any shares of any class of Stock or
other equity interest in such Person now or hereafter outstanding.
"Restricted Subsidiaries": collectively, the Operating
Subsidiaries and ACE.
"Revolving Credit Loans": as defined in Section 2.1.
"Senior Debt Rating": the long-term senior secured debt rating of
ACE as from time to time determined by S&P and/or Moody's.
"S&P": Standard & Poor's Ratings Group, a division of
McGraw-Hill, Inc., or any successor thereto.
"SEC": the Securities and Exchange Commission or any Governmental
Authority succeeding to the functions thereof.
"Special Counsel": Emmet, Marvin & Martin, LLP, special counsel
to the Agent.
"Stock": any and all shares, rights, interests, participations,
warrants or other equivalents (however designated) of corporate stock.
"Submission Deadline": as defined in Section 2.4(b).
"Subsidiary": as to any Person, any corporation, association,
partnership, limited liability company, joint venture or other business
entity of which such Person or any Subsidiary of such Person, directly
or indirectly, either (i) in respect of a corporation, owns or controls
more than 50% of the outstanding Stock having ordinary voting power to
elect a majority of the board of directors or similar managing body,
irrespective of whether a class or classes shall or might have voting
power by reason of the happening of any contingency, or (ii) in respect
of an association, partnership, joint venture or other business entity,
is entitled to share in more than 50% of the profits and losses, however
determined.
"Tax": any present or future tax, levy, impost, duty, charge,
fee, deduction or withholding of any nature and whatever called, by a
Governmental Authority, on whomsoever and wherever imposed, levied,
collected, withheld or assessed.
"Tax on the Overall Net Income": as to any Person, a Tax imposed
by the jurisdiction in which that Person's principal office (and/or, in
the case of a Lender, its Domestic Lending Office) is located or by any
political subdivision or taxing authority thereof or in which that
Person is deemed to be doing business on all or part of the net income,
profits or gains of that Person (whether worldwide, or only insofar as
such income, profits or gains are considered to arise in or to relate to
a particular jurisdiction, or otherwise).
"Termination Event": with respect to any Pension Plan, (i) a
Reportable Event, (ii) the termination of a Pension Plan, or the filing
of a notice of intent to terminate a Pension Plan, or the treatment of a
Pension Plan amendment as a termination under Section 4041(c) of ERISA,
(iii) the institution of proceedings to terminate a Pension Plan under
Section 4042 of ERISA, or (iv) the appointment of a trustee to
administer any Pension Plan under Section 4042 of ERISA.
"United States": the United States of America (including the
States thereof and the District of Columbia).
2. Principles of Construction
(a) All terms defined in a Loan Document shall have the meanings
given such terms therein when used in the other Loan Documents or any
certificate, opinion or other document made or delivered pursuant
thereto, unless otherwise defined therein.
(b) As used in the Loan Documents and in any certificate,
opinion or other document made or delivered pursuant thereto, accounting
terms not defined in Section 1.1, and accounting terms partly defined in
Section 1.1, to the extent not defined, shall have the respective
meanings given to them under GAAP.
(c) The words "hereof", "herein", "hereto" and "hereunder" and
similar words when used in a Loan Document shall refer to such Loan
Document as a whole and not to any particular provision thereof, and
Section, schedule and exhibit references contained therein shall refer
to Sections thereof or schedules or exhibits thereto unless otherwise
expressly provided therein.
(d) The phrase "may not" is prohibitive and not permissive.
(e) Unless the context otherwise requires, words in the singular
number include the plural, and words in the plural include the singular.
(f) Unless specifically provided in a Loan Document to the
contrary, references to a time shall refer to New York City time.
(g) Unless specifically provided in a Loan Document to the
contrary, 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".
(h) References in any Loan Document to a fiscal period shall
refer to that fiscal period of the Borrower.
B. AMOUNT AND TERMS OF LOANS AND LETTERS OF CREDIT
1. Revolving Credit Loans
Subject to the terms and conditions hereof, each Lender severally
agrees to make revolving credit loans (each a "Revolving Credit Loan"
and, as the context may require, collectively with all other Revolving
Credit Loans of such Lender and with the Revolving Credit Loans of all
other Lenders, the "Revolving Credit Loans") to the Borrower from time
to time during the Commitment Period, provided, however, that
immediately after giving effect thereto (i) such Lender's Credit
Exposure would not exceed such Lender's Commitment, and (ii) the
Aggregate Credit Exposure would not exceed the Aggregate Commitments.
During the Commitment Period, the Borrower may borrow, prepay in whole
or in part and reborrow under the Aggregate Commitments, all in
accordance with the terms and conditions of this Agreement.
2. Revolving Credit Notes
The Revolving Credit Loans made by a Lender shall be evidenced by
a promissory note of the Borrower, substantially in the form of Exhibit
B-1, with appropriate insertions therein as to date and principal amount
(each, as indorsed or modified from time to time, a "Revolving Credit
Note" and, collectively with the Revolving Credit Notes of all other
Lenders, the "Revolving Credit Notes"), payable to the order of such
Lender for the account of its Applicable Lending Office and representing
the obligation of the Borrower to pay the lesser of (i) the original
amount of the Commitment of such Lender and (ii) the aggregate unpaid
principal balance of all Revolving Credit Loans made by such Lender,
with interest thereon as prescribed in Section 2.8. Each Revolving
Credit Note shall (iii) be dated the first Borrowing Date, (iv) be
stated to mature on the Maturity Date and (v) bear interest from the
date thereof on the unpaid principal balance thereof at the applicable
interest rate or rates per annum determined as provided in Section 2.8.
Interest shall be payable as specified in Section 2.8.
3. Procedure for Borrowing Revolving Credit Loans
(a) The Borrower may borrow Revolving Credit Loans under the
Aggregate Commitments on any Business Day during the Commitment Period,
provided, however, that the Borrower shall notify the Agent in writing
by facsimile transmission no later than (i) 12:00 p.m., three Business
Days prior to the requested Borrowing Date, in the case of Eurodollar
Advances and (ii) 11:30 a.m. on the requested Borrowing Date, in the
case of ABR Advances, in each case specifying (1) the aggregate
principal amount to be borrowed under the Aggregate Commitments, (2) the
requested Borrowing Date, (3) whether such borrowing is to consist of
one or more Eurodollar Advances, ABR Advances, or a combination thereof
and (4) if the borrowing is to consist of one or more Eurodollar
Advances, the length of the Eurodollar Interest Period for each such
Eurodollar Advance, provided, however, that no Eurodollar Interest
Period selected in respect of any Revolving Credit Loan shall end after
the Maturity Date. If the Borrower fails to give timely notice in
connection with a request for a Eurodollar Advance, the Borrower shall
be deemed to have elected that such Advance shall be made as an ABR
Advance. Each such notice shall be irrevocable and confirmed promptly
(and in any event within five Business Days) by delivery to the Agent of
a manually signed Borrowing Request. Each ABR Advance shall be in an
aggregate principal amount equal to $1,000,000 or an integral multiple
of $1,000,000 in excess thereof (or, if the unused amount of the
Aggregate Commitments is less than such amount, then such lesser amount
of the Aggregate Commitments), and each Eurodollar Advance shall be in
an aggregate principal amount equal to $1,000,000 or an integral
multiple of $1,000,000 in excess thereof.
(b) Upon receipt of each notice of borrowing from the Borrower,
the Agent shall promptly notify each Lender thereof. Subject to its
receipt of the notice referred to in the preceding sentence, each Lender
will make the amount of its Commitment Percentage of each borrowing
available to the Agent for the account of the Borrower at the office of
the Agent set forth in Section 11.2 not later than 2:00 p.m. on the
relevant Borrowing Date requested by the Borrower, in funds immediately
available to the Agent at such office. The amounts so made available to
the Agent on such Borrowing Date will then, subject to the satisfaction
of the terms and conditions of this Agreement, as determined by the
Agent, be made available on such date to the Borrower by the Agent at
the office of the Agent specified in Section 11.2 by crediting the
account of the Borrower on the books of such office with the aggregate
of said amounts received by the Agent. In the event of any inconsistency
between the provisions of this Section and Sections 2.18 and 2.19 with
respect to Loans made pursuant to Section 2.18 to reimburse the Issuing
Bank for amounts paid by the Issuing Bank under Letters of Credit, the
provisions of Sections 2.18 and 2.19 shall control.
(c) Unless the Agent shall have received prior notice from a
Lender (by telephone or otherwise, such notice to be promptly confirmed
by fax or other writing) that such Lender will not make available to the
Agent such Lender's Commitment Percentage of the Revolving Credit Loans
requested by the Borrower, the Agent may assume that such Lender has
made such share available to the Agent on the Borrowing Date in
accordance with this Section, provided that such Lender received notice
of the proposed borrowing from the Agent, and the Agent may, in reliance
upon such assumption, make available to the Borrower on the Borrowing
Date a corresponding amount. If and to the extent such Lender shall not
have so made its Commitment Percentage of such Loans available to the
Agent, such Lender and the Borrower severally agree to pay to the Agent
forthwith on demand such corresponding amount (to the extent not
previously paid by the other), together with interest thereon for each
day from the date such amount is made available to the Borrower to the
date such amount is paid to the Agent, at a rate per annum equal to, in
the case of the Borrower, the applicable interest rate set forth in
Section 2.8 for such Loans, and, in the case of such Lender, the Federal
Funds Rate in effect on each such day (as determined by the Agent).
Such payment by the Borrower, however, shall be without prejudice to its
rights against such Lender. If such Lender shall pay to the Agent such
corresponding amount, such amount so paid shall constitute such Lender's
Revolving Credit Loan as part of the Revolving Credit Loans for purposes
of this Agreement, which Revolving Credit Loan shall be deemed to have
been made by such Lender on the Borrowing Date applicable to such
Revolving Credit Loans.
(d) If a Lender makes a new Revolving Credit Loan on a Borrowing
Date on which the Borrower is to repay a Revolving Credit Loan or
Competitive Bid Loan from such Lender, such Lender shall apply the
proceeds of such new Revolving Credit Loan to make such repayment, and
only the excess of the proceeds of such new Revolving Credit Loan over
the Revolving Credit Loan or Competitive Bid Loan being repaid need be
made available to the Agent.
(e) Notwithstanding the provisions of Section 2.3(a), the Agent
may act without liability upon the basis of telephonic notice of
borrowing believed by the Agent in good faith to be from an authorized
officer of the Borrower prior to receipt of written notice and
confirmation by facsimile or otherwise. In each such case, the Borrower
waives the right to dispute the Agent's record of the terms of such
telephone notice of such borrowing.
4. Competitive Bid Loans; Procedure
(a) The Borrower may make Competitive Bid Requests by 12:00 p.m.
at least one Business Day prior to the proposed Borrowing Date for one
or more Competitive Bid Loans. Each Competitive Bid Request given to
the Agent (which shall promptly on the same day give notice thereof to
each Lender by facsimile transmission of an Invitation to Bid if the
Competitive Bid Request is not rejected pursuant to this Section), shall
be given in writing by facsimile transmission (confirmed promptly, and
in any event within five Business Days, by the delivery to the Agent of
a Competitive Bid Request manually signed by the Borrower), and shall
specify (i) the proposed Borrowing Date, which shall be a Business Day,
(ii) the aggregate amount of the requested Competitive Bid Loans (the
"Maximum Request") which amount (A) shall not exceed an amount which, on
the proposed Borrowing Date and after giving effect to the requested
Competitive Bid Loans, would cause the Aggregate Credit Exposure to
exceed the Aggregate Commitments and (B) shall be in a principal amount
equal to $1,000,000 or an integral multiple of $1,000,000 in excess
thereof, (iii) the Competitive Interest Period(s) therefor and the last
day of each such Competitive Interest Period, and (iv) if more than one
Competitive Interest Period is so specified, the principal amount
allocable to each such Competitive Interest Period (which amount shall
not be less than $1,000,000 or an integral multiple of $1,000,000 in
excess thereof). A Competitive Bid Request that does not conform
substantially to the form of Exhibit D shall be rejected, and the Agent
shall promptly notify the Borrower of such rejection. Notwithstanding
anything contained herein to the contrary, (1) not more than three
Competitive Interest Periods may be requested pursuant to any
Competitive Bid Request and (2) not more than three Competitive Bid
Loans may be outstanding at any one time.
(b) Each Lender in its sole discretion may (but is not obligated
to) submit one or more Competitive Bids to the Agent not later than
10:00 a.m. on the proposed Borrowing Date specified in such Competitive
Bid Request (such time being herein called the "Submission Deadline"),
by fax or other writing, and thereby irrevocably offer to make all or
any part (any such part referred to as a "Portion") of any Competitive
Bid Loan described in the relevant Competitive Bid Request at a rate of
interest per annum (each a "Bid Rate") specified therein in an aggregate
principal amount of not less than $1,000,000 or an integral multiple of
$1,000,000 in excess thereof, provided that Competitive Bids submitted
by BNY may only be submitted if BNY notifies the Borrower of the terms
of its Competitive Bid not later than thirty minutes prior to the
Submission Deadline. Multiple Competitive Bids may be delivered to the
Agent by a Lender. The aggregate Portions of Competitive Bid Loans for
any or all Competitive Interest Periods offered by each Lender in its
Competitive Bid may exceed the Maximum Request contained in the relevant
Competitive Bid Request, provided that each Competitive Bid shall set
forth the maximum aggregate amount of the Competitive Bid Loans offered
thereby which the Borrower may accept (the "Maximum Offer"), which
Maximum Offer shall not exceed the Maximum Request. If the Agent has
not received a Competitive Bid from any Lender by the Submission
Deadline, such Lender shall be deemed not to have made a Competitive Bid
and shall not be permitted or obligated to make a Competitive Bid Loan
on the proposed Borrowing Date.
(c) The Agent shall promptly give notice by telephone (promptly
confirmed by fax or other writing) to the Borrower of all Competitive
Bids received by the Agent prior to the Submission Deadline which comply
in all material respects with this Section. The Borrower shall, in its
sole discretion but subject to Section 2.4(d), irrevocably accept or
reject any such Competitive Bid (or any Portion thereof) not later than
10:30 a.m. on the day of the Submission Deadline by notice to the Agent
by telephone (confirmed by fax or other writing in the form of a
Competitive Bid Accept/Reject Letter promptly the same day). Promptly
upon receipt by the Agent of such a Competitive Bid Accept/Reject
Letter, the Agent will give notice to each Lender that submitted a
Competitive Bid as to the extent, if any, that such Lender's Competitive
Bid shall have been accepted. If the Agent fails to receive notice from
the Borrower of its acceptance or rejection of any Competitive Bids at
or prior to 10:30 a.m. on the day of the Submission Deadline, all such
Competitive Bids shall be deemed to have been rejected by the Borrower,
and the Agent will give to each Lender that submitted a Competitive Bid
notice of such rejection by telephone on such day. In due course
following the acceptance of any Competitive Bid, the Agent shall notify
each Lender which submitted a Competitive Bid, in the form of a
Competitive Bid Loan Confirmation, of the amount, maturity date and Bid
Rate for each Competitive Bid Loan.
(d) If the Borrower accepts a Portion of a proposed Competitive
Bid Loan for a single Competitive Interest Period at the Bid Rate
provided therefor in a Lender's Competitive Bid, such Portion shall be
in a principal amount of $1,000,000 or an integral multiple of
$1,000,000 in excess thereof (subject to such lesser allocation as may
be made pursuant to the provisions of this Section 2.4(d)). The
aggregate principal amount of Competitive Bid Loans accepted by the
Borrower following Competitive Bids responding to a Competitive Bid
Request shall not exceed the Maximum Request. The aggregate principal
amount of Competitive Bid Loans accepted by the Borrower pursuant to a
Lender's Competitive Bid shall not exceed the Maximum Offer therein
contained. If the Borrower accepts any Competitive Bid Loans or Portion
offered in any Competitive Bid, the Borrower must accept Competitive
Bids (and Competitive Bid Loans and Portions thereby offered) based
exclusively upon the successively lowest Bid Rates within each
Competitive Interest Period and no other criteria. If two or more
Lenders submit Competitive Bids with identical Bid Rates for the same
Competitive Interest Period and the Borrower accepts any thereof, the
Borrower shall, subject to the first three sentences of this Section
2.4(d), accept all such Competitive Bids as nearly as possible in
proportion to the amounts of such Lender's respective Competitive Bids
with identical Bid Rates for such Competitive Interest Period, provided,
that if the amount of Competitive Bid Loans to be so allocated is not
sufficient to enable each such Lender to make such Competitive Bid Loan
(or Portions thereof) in an aggregate principal amount of $1,000,000 or
an integral multiple of $1,000,000 in excess thereof, the Borrower
shall round the Competitive Bid Loans (or Portions thereof) allocated to
such Lender or Lenders as the Borrower shall select as necessary to a
minimum of $1,000,000 or an integral multiple of $500,000 in excess
thereof.
(e) Not later than 2:00 p.m. on the relevant Borrowing Date,
each Lender whose Competitive Bid was accepted by the Borrower shall
make available to the Agent at its office set forth in Section 11.2, in
immediately available funds, the proceeds of such Lender's Competitive
Bid Loan(s). The amounts so made available to the Agent on such
Borrowing Date will then, subject to the satisfaction of the terms and
conditions of this Agreement, as determined by the Agent, be made
available on such date to the Borrower by the Agent at the office of the
Agent specified in Section 11.2 by crediting the account of the Borrower
on the books of such office with the aggregate of said amounts received
by the Agent.
(f) All notices required by this Section 2.4 shall be given in
accordance with Section 11.2.
(g) The Competitive Bid Loans made by each Lender shall be
evidenced by a promissory note of the Borrower, substantially in the
form of Exhibit B-2 (each, as indorsed or modified from time to time, a
"Competitive Bid Note" and, collectively with the Competitive Bid Notes
of all other Lenders, the "Competitive Bid Notes"), payable to the order
of such Lender for the account of its Applicable Lending Office, and
dated the first Borrowing Date. Each Competitive Bid Loan shall be due
and payable on the earlier of (i) the last day of the Competitive
Interest Period applicable thereto and (ii) the Maturity Date.
5. Voluntary Reduction or Termination of Aggregate Commitments;
Letter of Credit
The Borrower shall have the right, upon at least three Business
Days' prior written notice to the Agent, at any time to terminate the
Aggregate Commitments or from time to time to permanently reduce the
Aggregate Commitments or the Letter of Credit Commitments, provided,
however, that each such reduction shall be in the amount of $5,000,000
or an integral multiple of $1,000,000 in excess thereof. Each reduction
of the Aggregate Commitments shall be applied pro rata according to the
Commitment Percentage of each Lender. Simultaneously with each
reduction of the Aggregate Commitments under this Section, the Borrower
shall (i) pay the Facility Fee accrued on the amount by which the
Aggregate Commitments have been reduced and (ii) prepay the Loans as
required by Section 2.6. The Aggregate Commitments shall not be reduced
below an amount equal to the Aggregate Credit Exposure (after giving
effect to any prepayment of the Loans made simultaneously with such
reduction of the Aggregate Commitments). The Aggregate Commitments shall
not be reduced to the extent that, immediately after giving effect
thereto, the Commitment of any Lender would exceed the sum of (i) the
aggregate principal amount of all Revolving Credit Loans then
outstanding from such Lender plus (ii) the Letter of Credit Exposure of
such Lender. The Letter of Credit Commitment shall not be reduced below
an amount equal to the Letter of Credit Exposure.
6. Prepayments of the Loans
(a) Voluntary Prepayments. The Borrower may, at its option,
prepay the Revolving Credit Loans without premium or penalty, in full at
any time or in part from time to time by notifying the Agent in writing
no later than 11:30 a.m. on the date of the proposed prepayment date, in
the case of Revolving Credit Loans consisting of ABR Advances and no
later than 12:00 p.m. on the third Business Day prior to the proposed
prepayment date, in the case of Revolving Credit Loans consisting of
Eurodollar Advances, specifying the Revolving Credit Loans to be
prepaid, the amount to be prepaid and the date of prepayment.
Competitive Bid Loans may not be prepaid. Such notice shall be
irrevocable and the amount specified in such notice shall be due and
payable on the date specified, together with accrued interest to the
date of such payment on the amount prepaid. Upon receipt of such
notice, the Agent shall promptly notify each Lender thereof. Each
partial prepayment of Revolving Credit Loans shall be in an aggregate
principal amount of (A) $1,000,000 or an integral multiple of $1,000,000
in excess thereof, or (B) if the outstanding principal balance of the
Revolving Credit Loans is less that the minimum amounts set forth in
clause (A), then such lesser outstanding principal balance. After
giving effect to any partial prepayment with respect to Eurodollar
Advances which were made (whether as the result of a borrowing or a
conversion) on the same date and which had the same Interest Period, the
outstanding principal amount of such Eurodollar Advances shall exceed
(subject to Section 2.7) $1,000,000 or an integral multiple of
$1,000,000 in excess thereof. If any prepayment is made in respect of
any Eurodollar Advance or Competitive Bid Loan, in whole or in part,
prior to the last day of the applicable Interest Period, the Borrower
agrees to indemnify the applicable Lenders in accordance with Section
2.13.
(b) Mandatory Prepayments Relating to Reductions of the
Aggregate Commitments. Simultaneously with each reduction of the
Aggregate Commitments under Section 2.5, the Borrower shall prepay the
Loans by the amount, if any, by which the aggregate unpaid principal
balance of the Loans exceeds the amount of the Aggregate Commitments as
so reduced. Such prepayments shall be applied (i) first, to prepay the
Revolving Credit Loans pro rata according to the Commitment of each
Lender, and (ii) then, to the extent of any excess remaining, to prepay
the Competitive Bid Loans, pro rata according to the outstanding amount
of each Competitive Bid Loan.
7. Conversions and Continuations
(a) The Borrower may elect from time to time to convert
Eurodollar Advances to ABR Advances by giving the Agent at least one
Business Day's prior irrevocable notice in writing by facsimile
transmission of such election (confirmed promptly, and in any event
within five Business Days, by the delivery of a manually signed Notice
of Conversion/Continuation), specifying the amount to be so converted,
provided, that any such conversion of Eurodollar Advances shall only be
made on the last day of the Interest Period applicable thereto. In
addition, the Borrower may elect from time to time to (i) convert ABR
Advances to Eurodollar Advances and (ii) to continue Eurodollar Advances
by selecting a new Interest Period therefor, in each case by giving the
Agent at least three Business Days' prior irrevocable notice in writing
by facsimile transmission of such election (confirmed promptly, and in
any event within five Business Days, by the delivery of a manually
signed Notice of Conversion/Continuation), in the case of a conversion
to, or continuation of, Eurodollar Advances, specifying the amount to
be so converted and the initial Interest Period relating thereto,
provided that any such conversion of ABR Advances to Eurodollar Advances
shall only be made on a Business Day and any such continuation of
Eurodollar Advances shall only be made on the last day of the Interest
Period applicable to the Eurodollar Advances which are to be continued
as such new Eurodollar Advances. The Agent shall promptly provide the
Lenders with a copy of each such Notice of Conversion/Continuation. ABR
Advances and Eurodollar Advances may be converted or continued pursuant
to this Section in whole or in part, provided that conversions of ABR
Advances to Eurodollar Advances, or continuations of Eurodollar Advances
shall be in an aggregate principal amount of $1,000,000 or such amount
plus a whole multiple of $1,000,000 in excess thereof.
(b) Notwithstanding anything in this Section to the contrary, no
ABR Advance may be converted to a Eurodollar Advance and no Eurodollar
Advance may be continued, if the Borrower or the Agent has knowledge
that a Default or Event of Default has occurred and is continuing either
(i) at the time the Borrower shall notify the Agent of its election to
convert or continue or (ii) on the requested Conversion/Continuation
Date. In such event, such ABR Advance shall be automatically continued
as an ABR Advance, or such Eurodollar Advance shall be automatically
converted to an ABR Advance on the last day of the Interest Period
applicable to such Eurodollar Advance. If an Event of Default shall
have occurred and be continuing, the Agent shall, at the request of the
Required Lenders, notify the Borrower (by telephone or otherwise) that
all, or such lesser amount as the Required Lenders shall designate, of
the outstanding Eurodollar Advances shall be automatically converted to
ABR Advances, in which event such Eurodollar Advances shall be
automatically converted to ABR Advances on the date such notice is
given.
(c) No Interest Period selected in respect of conversion or
continuation of any Eurodollar Advance shall end after the Maturity
Date.
(d) Each conversion or continuation shall be effected by each
Lender by applying the proceeds of its new ABR Advance or Eurodollar
Advance, as the case may be, to its Advances (or portion thereof) being
converted (it being understood that such conversion shall not constitute
a borrowing for purposes of Sections 4, 5 or 6).
(e) Notwithstanding the provisions of Section 2.7(a), the Agent
may act without liability upon the basis of telephonic notice of such
conversion or continuation believed by the Agent in good faith to be
from an authorized officer of the Borrower prior to receipt of written
notice and confirmation, by facsimile or otherwise. In each such case,
the Borrower waives the right to dispute the Agent's record of the terms
of such telephone notice of such conversion or continuation.
8. Interest Rate and Payment Dates
(a) Prior to Maturity. Except as otherwise provided in Section
2.8(b), prior to maturity, the Loans shall bear interest on the
outstanding principal balance thereof at the applicable interest rate or
rates per annum set forth below:
ADVANCES RATE
Each ABR Advance Alternate Base Rate.
Each Eurodollar Advance Eurodollar Rate for the
applicable Interest Period
plus the Applicable Margin.
Each Competitive Bid Rate applicable thereto
for Bid Loan the applicable
Competitive Interest Period.
(b) Late Charges. If all or any portion of the principal balance of
or interest payable on any of the Loans or any other amount payable
under the Loan Documents shall not be paid when due (whether at the
stated maturity thereof, by acceleration or otherwise), such overdue
balance or amount shall bear interest at a rate per annum (whether
before or after the entry of a judgment thereon) equal to 2% plus the
rate which would otherwise be applicable pursuant to Section 2.8(a),
from the date of such nonpayment to, but not including, the date such
balance is paid in full. All such interest shall be payable on demand.
(c) In General. Interest on (i) ABR Advances to the extent based
on the BNY Rate shall be calculated on the basis of a 365 or 366-day
year (as the case may be), and (ii) ABR Advances to the extent based on
the Federal Funds Rate, on Eurodollar Advances and on Competitive Bid
Loans shall be calculated on the basis of a 360-day year, in each case,
for the actual number of days elapsed, including the first day but
excluding the last. Except as otherwise provided in Section 2.8(b),
interest shall be payable in arrears on each Interest Payment Date and
upon each payment (including prepayment) of the Loans. Any change in
the interest rate on the Loans resulting from a change in the Alternate
Base Rate or reserve requirements shall become effective as of the
opening of business on the day on which such change shall become
effective. The Agent shall, as soon as practicable, notify the Borrower
and the Lenders of the effective date and the amount of each such change
in the BNY Rate, but any failure to so notify shall not in any manner
affect the obligation of the Borrower to pay interest on the Loans in
the amounts and on the dates required. Each determination of the
Alternate Base Rate or a Eurodollar Rate by the Agent pursuant to this
Agreement shall be conclusive and binding on all parties hereto absent
manifest error. At no time shall the interest rate payable on the
Loans, together with the Facility Fee and all other amounts payable
under the Loan Documents, to the extent the same are construed to
constitute interest, exceed the Highest Lawful Rate. If any amount paid
hereunder would exceed the maximum amount of interest permitted by the
Highest Lawful Rate, then such amount shall automatically be reduced to
such maximum permitted amount, and interest for any subsequent period,
to the extent less than the maximum amount permitted for such period by
the Highest Lawful Rate, shall be increased by the unpaid amount of such
reduction. Any interest actually received for any period in excess of
such maximum allowable amount for such period shall be deemed to have
been applied as a prepayment of (x) the Loans or, if no Loans are then
outstanding, (y) any unpaid reimbursement obligations in respect of
Letters of Credit. The Borrower acknowledges that to the extent
interest payable on ABR Advances is based on the BNY Rate, the BNY Rate
is only one of the bases for computing interest on loans made by the
Lenders, and by basing interest payable on ABR Advances on the BNY Rate,
the Lenders have not committed to charge, and the Borrower has not in
any way bargained for, interest based on a lower or the lowest rate at
which the Lenders may now or in the future make loans to other
borrowers.
9. Substituted Interest Rate
In the event that (i) the Agent shall have determined (which
determination shall be conclusive and binding upon the Borrower) that by
reason of circumstances affecting the interbank eurodollar market either
adequate and reasonable means do not exist for ascertaining the
Eurodollar Rate or (ii) any Lender shall have notified the Agent that it
has determined (which determination shall be conclusive and binding on
the Borrower) that the applicable Eurodollar Rate will not adequately
and fairly reflect the cost to such Lender of maintaining or funding
loans bearing interest based on such Eurodollar Rate, with respect to
any portion of the Revolving Credit Loans that the Borrower has
requested be made as Eurodollar Advances or Eurodollar Advances that
will result from the requested conversion or continuation of any portion
of the Advances into or as Eurodollar Advances (each, an "Affected
Advance"), the Agent shall promptly notify the Borrower and the Lenders
(by telephone or otherwise, to be promptly confirmed in writing) of such
determination on or, to the extent practicable, prior to the requested
Borrowing Date or Conversion/Continuation Date for such Affected
Advances. If the Agent shall give such notice, (a) any Affected
Advances shall be made as ABR Advances, (b) the Advances (or any portion
thereof) that were to have been converted to or continued as Affected
Advances shall be converted to or continued as ABR Advances and (c) any
outstanding Affected Advances shall be converted, on the last day of the
then current Interest Period with respect thereto, to ABR Advances.
Until any notice under clauses (i) or (ii), as the case may be, of this
Section has been withdrawn by the Agent (by notice to the Borrower
promptly upon either (1) the Agent having determined that such
circumstances affecting the interbank eurodollar market no longer exist
and that adequate and reasonable means do exist for determining the
Eurodollar Rate pursuant to Section 2.8 or (2) the Agent having been
notified by such Lender that circumstances no longer render the Advances
(or any portion thereof) Affected Advances, no further Eurodollar
Advances shall be required to be made by the Lenders, nor shall the
Borrower have the right to convert or continue all or any portion of the
Loans to Eurodollar Advances.
10. Taxes
(a) Payments to Be Free and Clear. Provided that all
documentation, if any, then required to be delivered by any Lender or
the Agent pursuant to subsection (c) has been delivered, all sums
payable by the Borrower under the Loan Documents shall (except to the
extent required by law) be paid free and clear of and without any
deduction or withholding on account of any Tax (other than a Tax on the
Overall Net Income of any Lender (for which payment need not be free and
clear but no deduction or withholding shall be made unless then required
by applicable law)) imposed, levied, collected, withheld or assessed by
or within the United States or any political subdivision in or of the
United States or any other jurisdiction from or to which a payment is
made by or on behalf of the Borrower or by any federation or
organization of which the United States or any such jurisdiction is a
member at the time of payment.
(b) Grossing-up of Payments. If the Borrower or any other Person
is required by law to make any deduction or withholding on account of
any such Tax (other than a Tax on the Overall Net Income of a Lender)
from any sum paid or payable by the Borrower to the Agent or any Lender
under any of the Loan Documents:
(i) the Borrower shall notify the Agent and such Lender of
any such requirement or any change in any such requirement as soon as
the Borrower becomes aware of it;
(ii) the Borrower shall pay any such Tax before the date on
which penalties attach thereto, such payment to be made (if the
liability to pay is imposed on the Borrower) for its own account or
(if that liability is imposed on the Agent or such Lender, as the case
may be) on behalf of and in the name of the Agent or such Lender;
(iii) the sum payable by the Borrower to the Agent or a
Lender in respect of which the relevant deduction, withholding or
payment is required shall be increased to the extent necessary to
ensure that, after the making of that deduction, withholding or
payment, the Agent or such Lender, as the case may be, receives on the
due date therefor a net sum equal to what it would have received had
no such deduction, withholding or payment been required or made; and
(iv) within 30 days after paying any sum from which it is
required by law to make any deduction or withholding, and within 30
days after the due date of payment of any Tax which it is required by
clause (b) above to pay, the Borrower shall deliver to the Agent and
the applicable Lender evidence satisfactory to the other affected
parties of such deduction, withholding or payment and of the
remittance thereof to the relevant Governmental Authority;
provided that no such additional amount shall be required to be paid to
any Lender under clause (iii) above except to the extent that any change
after the date hereof (in the case of each Lender listed on the
signature pages hereof) or after the date of the Assignment and
Acceptance Agreement pursuant to which such Lender became a Lender (in
the case of each other Lender) in any such requirement for a deduction,
withholding or payment as is mentioned therein shall result in an
increase in the rate of such deduction, withholding or payment from that
in effect at the date of this Agreement or at the date of such
Assignment and Acceptance, as the case may be, in respect of payments to
such Lender.
(c) Refunds and Credits. If the Borrower makes any additional
payment to any Lender pursuant to this Section 2.10 in respect of any
Tax, and such Lender determines that it has received (i) a refund of
such Tax or (ii) a credit against or relief or remission for, or a
reduction in the amount of, any tax or other governmental charge
attributable solely to any deduction or credit for any Tax with respect
to which it has received payments under this Section 2.10, such Lender
shall to the extent that it can do so without prejudice to the retention
of such refund, credit, relief, remission or reduction, pay to the
Borrower such amount as such Lender shall have determined to be
attributable to the deduction or withholding of such Tax. If, within
one year after the payment of any such amount to the Borrower, such
Lender determines that it was not entitled to such refund, credit,
relief, remission or reduction to the full extent of any payment made
pursuant to the first sentence of this Section 2.10(c), the Borrower
shall upon notice and demand of such Lender promptly repay the amount of
such overpayment. Any determination made by such Lender pursuant to
this Section 2.10(c) shall in the absence of bad faith or manifest error
be conclusive, and nothing in this Section 2.10(c) shall be construed as
requiring any Lender to conduct its business or to arrange or alter in
any respect its tax or financial affairs (except as required by Section
2.17(a)) so that it is entitled to receive such a refund, credit or
reduction or as allowing any person to inspect any records, including
tax returns of any Lender.
(d) Limitation of Liability. No Lender shall be entitled to
demand any payment under this Section 2.10 more than six months
following the payment to or for the account of such Lender of all other
amounts payable hereunder and under any Note held by such Lender and the
termination of such Lender's Commitment; provided, however, that the
foregoing proviso shall in no way limit the right of any Lender to
demand or receive any payment under this Section 2.10 to the extent that
such payment relates to the retroactive application of any Tax if such
demand is made within six months after the implementation of such Tax.
(e) U.S. Tax Certificates. Each Lender that is organized under
the laws of any jurisdiction other than the United States shall deliver
to the Agent for transmission to the Borrower, on or prior to the
Effective Date (in the case of each Lender listed on the signature pages
hereof) or on the effective date of the Assignment and Acceptance
Agreement pursuant to which it becomes a Lender (in the case of each
other Lender), and at such other times as may be necessary in the
determination of the Borrower or the Agent (each in the reasonable
exercise of its discretion), such certificates, documents or other
evidence, properly completed and duly executed by such Lender
(including, without limitation, Internal Revenue Service Form W-8, Form
1001 or Form 4224 or any other certificate or statement of exemption
required by Treasury Regulations Section 1.1441-4(a) or Section
1.1441-6(c), or Temporary Treasury Regulations Section 35a9999-4T or
Section 35a9999-5, or any successor thereto) to establish that such
Lender is not subject to deduction or withholding of United States
federal income tax under Section 1441 or 1442 of the Code or otherwise
(or under any comparable provisions of any successor statute) with
respect to any payments to such Lender of principal, interest, fees or
other amounts payable under any of the Loan Documents. The Borrower
shall not be required to pay any additional amount to any such Lender
under subsection (b)(iii) above if such Lender shall have failed to
satisfy the requirements of the immediately preceding sentence; provided
that if such Lender shall have satisfied such requirements on the
Effective Date (in the case of each Lender listed on the signature pages
hereof) or on the effective date of the Assignment and Acceptance
Agreement pursuant to which it became a Lender (in the case of each
other Lender), nothing in this subsection shall relieve the Borrower of
its obligation to pay any additional amounts pursuant to subsection
(b)(iii) in the event that, as a result of any change in applicable law,
such Lender is no longer properly entitled to deliver certificates,
documents or other evidence at a subsequent date establishing the fact
that such Lender is not subject to withholding as described in the
immediately preceding sentence.
11. Illegality
Notwithstanding any other provisions herein, if any law,
regulation, treaty or directive, or any change therein or in the
interpretation or application thereof, shall make it unlawful for any
Lender to make or maintain its Eurodollar Advances as contemplated by
this Agreement, (i) the commitment of such Lender hereunder to make
Eurodollar Advances or convert ABR Advances to Eurodollar Advances shall
forthwith be suspended and (ii) such Lender's Loans then outstanding as
Eurodollar Advances affected hereby, if any, shall be converted
automatically to ABR Advances on the last day of the then current
Interest Period applicable thereto or within such earlier period as
required by law. If the commitment of any Lender with respect to
Eurodollar Advances is suspended pursuant to this Section and such
Lender shall notify the Agent and the Borrower that it is once again
legal for such Lender to make or maintain Eurodollar Advances, such
Lender's commitment to make or maintain Eurodollar Advances shall be
reinstated.
12. Increased Costs
In the event that any law, regulation, treaty or directive
hereafter enacted, promulgated, approved or issued or any change in any
presently existing law, regulation, treaty or directive therein or in
the interpretation or application thereof by any Governmental Authority
charged with the administration thereof or compliance by any Lender (or
any corporation directly or indirectly owning or controlling such
Lender) with any request or directive from any Governmental Authority:
(a) does or shall subject any Lender to any Taxes of any kind
whatsoever with respect to any Eurodollar Advances or its obligations
under this Agreement to make Eurodollar Advances, or change the basis
of taxation of payments to any Lender of principal, interest or any
other amount payable hereunder in respect of its Eurodollar Advances,
including any Taxes required to be withheld from any amounts payable
under the Loan Documents (except for imposition of, or change in the
rate of, Tax on the Overall Net Income of such Lender or its
Applicable Lending Office for any of such Advances by the jurisdiction
in which such Lender is incorporated or has its principal office or
such Applicable Lending Office, including, in the case of Lenders
incorporated in any State of the United States, such tax imposed by
the United States); or
(b) does or shall impose, modify or make applicable any reserve,
special deposit, compulsory loan, assessment, increased cost or
similar requirement against assets held by, or deposits of, or
advances or loans by, or other credit extended by, or any other
acquisition of funds by, any office of such Lender in respect of its
Eurodollar Advances which is not otherwise included in the
determination of a Eurodollar Rate;
and the result of any of the foregoing is to increase the cost to such
Lender of making, renewing, converting, continuing or maintaining its
Eurodollar Advances or its commitment to make such Eurodollar Advances,
or to reduce any amount receivable hereunder in respect of its
Eurodollar Advances, then, in any such case, the Borrower shall pay such
Lender, upon its demand, any additional amounts necessary to compensate
such Lender for such additional cost or reduction in such amount
receivable which such Lender deems to be material as determined by such
Lender; provided, however, that (i) nothing in this Section shall
require the Borrower to indemnify the Lenders with respect to
withholding Taxes for which the Borrower has no obligation under Section
2.10, and (ii) no Lender shall be entitled to demand any payment under
this Section 2.12 more than six months following the payment to or for
the account of such Lender of all other amounts payable hereunder and
under any Note held by such Lender and the termination of such Lender's
Commitment; provided, however, that the foregoing proviso shall in no
way limit the right of any Lender to demand or receive any payment under
this Section 2.12 to the extent that such payment relates to the
retroactive application of any law, regulation, treaty or directive if
such demand is made within six months after the implementation of such
retroactive application. A statement setting forth the calculations of
any additional amounts payable pursuant to the foregoing sentence
submitted by a Lender to the Borrower shall be conclusive absent
manifest error.
13. Indemnification for Loss
Notwithstanding anything contained herein to the contrary, if the
Borrower shall fail to borrow, convert or continue an Advance after it
shall have given notice to do so in which it shall have requested a
Eurodollar Advance pursuant to Section 2.3 or 2.7, as the case may be,
or if the Borrower shall fail to borrow a Competitive Bid Loan after it
shall have accepted one or more offers therefor pursuant to Section 2.4,
or if a Eurodollar Advance or a Competitive Bid Loan shall be terminated
for any reason prior to the last day of the Interest Period applicable
thereto, or if any repayment or prepayment of the principal amount of a
Eurodollar Advance or a Competitive Bid Loan is made for any reason on a
date which is prior to the last day of the Interest Period applicable
thereto, the Borrower agrees to indemnify each Lender against, and to
pay on written demand directly to such Lender the amount (calculated by
such Lender using any method chosen by such Lender which is reasonable
and customarily used by such Lender for such purpose) equal to any loss
or out-of-pocket expense suffered by such Lender as a result of such
failure to borrow, convert or continue, or such termination, repayment
or prepayment, including any loss, cost or expense suffered by such
Lender in liquidating or employing deposits acquired to fund or maintain
the funding of such Eurodollar Advance or Competitive Bid Loan, as the
case may be, or redeploying funds prepaid or repaid, in amounts which
correspond to such Eurodollar Advance or Competitive Bid Loan, as the
case may be, and any internal processing charge customarily charged by
such Lender in connection therewith. Calculations of all amounts
payable under this Section shall be made on the assumption that each
Lender has funded each of its relevant Eurodollar Advances and
Competitive Bid Loans through the purchase of deposits bearing interest
at the applicable rate of interest for, in an amount equal to the
principal amount of, and with a maturity equivalent to the Interest
Period applicable to, such Eurodollar Advance or Competitive Bid Loan,
as the case may be.
14. Survival of Certain Obligations
The obligations of the Borrower under Sections 2.10, 2.12, 2.13,
2.16, 2.21, 11.5 and 11.10 shall survive the termination of the
Aggregate Commitments and the Letter of Credit Commitment, the payment
of the Loans, the reimbursement obligations in respect of the Letters of
Credit and all other amounts payable under the Loan Documents.
15. Use of Proceeds
The proceeds of the Loans shall be used solely to (i) pay all of
the fees due hereunder, (ii) pay the reasonable out-of-pocket fees and
expenses incurred by the Borrower in connection with the Loan Documents,
(iii) for the general corporate purposes of the Borrower, including,
without limitation, the making of Intercompany Loans to Operating
Subsidiaries of the Borrower and Permitted Recipient Loans to Permitted
Recipients to the extent permitted by Section 8.5 and (iv) to make
repurchases of its stock to the extent permitted by Section 8.4.
Notwithstanding anything to the contrary contained in any Loan Document,
the Borrower agrees that no part of the proceeds of any Loan will be
used, directly or indirectly, for a purpose which violates any law,
including, without limitation, the provisions of Regulations G, U or X
of the Board of Governors of the Federal Reserve System, as amended.
16. Capital Adequacy
If the amount of capital required or expected to be maintained by
any Lender or any Person directly or indirectly owning or controlling
such Lender (each a "Control Person"), shall be affected by (i) the
introduction or phasing in of any law, rule or regulation after the
Effective Date, (ii) any change after the Effective Date in the
interpretation of any existing law, rule or regulation by any
Governmental Authority charged with the administration thereof, or (iii)
compliance by such Lender or such Control Person with any directive,
guideline or request from any Governmental Authority (whether or not
having the force of law) promulgated or made after the Effective Date,
and such Lender shall have determined that such introduction, phasing
in, change or compliance shall have had or will thereafter have the
effect of reducing (1) the rate of return on such Lender's or such
Control Person's capital, or (2) the asset value to such Lender or such
Control Person of the Loans made or maintained by such Lender, in either
case to a level below that which such Lender or such Control Person
could have achieved or would thereafter be able to achieve but for such
introduction, phasing in, change or compliance (after taking into
account such Lender's or such Control Person's policies regarding
capital adequacy) by an amount deemed by such Lender to be material to
such Lender or Control Person, then, within ten days after demand by
such Lender, the Borrower shall pay to such Lender or such Control
Person such additional amount or amounts as shall be sufficient to
compensate such Lender or such Control Person, as the case may be, for
such reduction.
17. Change of Lending Office; Right to Substitute Lender
(a) Each Lender agrees that, upon the occurrence of any event
giving rise to the operation of Section 2.12, 2.13 or 2.21 or to a
requirement under Section 2.10 to withhold and deduct taxes, it will, if
requested by the Borrower, use reasonable efforts (subject to overall
policy considerations of such Lender) to designate another Applicable
Lending Office for any Loans affected by such event, provided that such
designation is made on such terms that such Lender and its Applicable
Lending Office suffer no economic, legal or regulatory disadvantage,
with the object of avoiding the consequence of the event giving rise to
the operation of any such Section. Except in the case of a change of
Applicable Lending Office made at the request of the Borrower, no change
in Applicable Lending Office will be made if greater costs and expenses
would result under Section 2.12, 2.13 or 2.21 or if the aforementioned
requirement under Section 2.10 would result from any such change in
designation. Nothing in this Section shall affect or postpone any of
the obligations of the Borrower or the rights of any Lender provided in
Section 2.10, 2.12, 2.16 or 2.21.
(b) In addition to the Borrower's rights under subsection (a) of
this Section, upon the occurrence of any event giving rise to the
operation of Section 2.10, 2.12, 2.13 or 2.21, the Borrower may, within
a period of 60 days following the Borrower's obtaining knowledge of the
occurrence of the event giving rise to the operation of such provisions,
at its own expense, make arrangements for another bank or financial
institution reasonably acceptable to the Agent to purchase and accept
the rights and obligations under this Agreement of any Lender entitled
to payment under Section 2.10, 2.12, 2.13 or 2.21, whereupon such
Lender shall assign to the bank or financial institution designated by
the Borrower its rights and obligations hereunder pursuant to the
provisions of Section 11.7 of this Agreement.
18. Letter of Credit Sub-Facility
(a) Subject to the terms and conditions of this Agreement, the
Issuing Bank agrees, in reliance on the agreement of the other Lenders
set forth in Section 2.19, to issue standby letters of credit (the
"Letters of Credit"; each, individually, a "Letter of Credit") during
the Commitment Period for the account of the Borrower. The aggregate
amount of Letter of Credit Exposure at any one time outstanding shall
not exceed the lesser of (i) the amount of the Letter of Credit
Commitment and (ii) the excess, if any, of the sum of the Aggregate
Commitments over the sum of the aggregate outstanding Loans. Each
Letter of Credit issued pursuant to this Section shall have a
termination date which shall be not later than one Business Day before
the Maturity Date. No Letter of Credit shall be issued if the Agent, or
any Lender by notice to the Agent no later than 1:00 p.m. one Business
Day prior to the requested date of issuance of such Letter of Credit,
shall have determined that the conditions set forth in Section 6 have
not been satisfied.
(b) Each Letter of Credit shall be issued for the account of the
Borrower in support of an obligation of the Borrower in favor of a
beneficiary who has requested the issuance of such Letter of Credit as a
condition to a transaction entered into in connection with the business
of an Operating Subsidiary of the Borrower, which transaction does not
include obligations for the borrowing of money or Contingent Obligations
with respect thereto. The Borrower shall give the Agent a Letter of
Credit Request for the issuance of each Letter of Credit by 11:00 a.m.,
three Business Days prior to the requested date of issuance. Such
Letter of Credit Request shall be accompanied by the Issuing Bank's
standard Application and Agreement for Standby Letter of Credit (each, a
"Reimbursement Agreement") executed by an Authorized Signatory of the
Borrower, and shall specify (i) the beneficiary of such Letter of Credit
and the obligations of the Borrower in respect of which such Letter of
Credit is to be issued, (ii) the conditions under which a drawing may be
made under such Letter of Credit and the documentation to be required in
respect thereof, (iii) the maximum amount to be available under such
Letter of Credit, and (iv) the requested date of issuance. In the event
of any conflict between the provisions of a Reimbursement Agreement and
this Section 2.18, the provisions of this Section 2.18 shall control.
Upon receipt of such Letter of Credit Request from the Borrower, the
Agent shall promptly notify the Issuing Bank and each other Lender
thereof. The Issuing Bank shall, on the proposed date of issuance and
subject to the other terms and conditions of this Agreement, issue the
requested Letter of Credit. Each Letter of Credit shall be in form and
substance reasonably satisfactory to the Issuing Bank, with such
provisions with respect to the conditions under which a drawing may be
made thereunder and the documentation required in respect of such
drawing as the Issuing Bank shall reasonably require. Each Letter of
Credit shall be used solely for the purposes described therein.
(c) Each payment by the Issuing Bank of a draft drawn under a
Letter of Credit shall give rise to an obligation on the part of the
Borrower to reimburse the Issuing Bank immediately for the amount
thereof. If the Borrower shall have failed to reimburse the Issuing
Bank in full on or before 12:00 p.m., on the date the Issuing Bank shall
make payment on a draft drawn under a Letter of Credit, the Borrower's
obligations to make such reimbursement may be satisfied by the
automatic making of an ABR Advance by each Lender under its Revolving
Credit Note in the principal amount equal to its Commitment Percentage
of the amount of such draft paid by the Issuing Bank (it being
understood that such reimbursement by means of an ABR Advance shall not
constitute a borrowing for purposes of Sections 4, 5 or 6).
19. Letter of Credit Participation and Funding Commitments
(a) Each Lender hereby unconditionally and irrevocably,
severally for itself only and without any notice to or the taking of any
action by such Lender, takes an undivided participating interest in the
obligations of the Issuing Bank under and in connection with each Letter
of Credit in an amount equal to such Lender's Commitment Percentage of
the amount of such Letter of Credit. Each Lender shall be liable to the
Issuing Bank for its Commitment Percentage of the unreimbursed amount of
any draft drawn and honored under each Letter of Credit. Each Lender
shall also be liable for an amount equal to the product of its
Commitment Percentage and any amounts paid by the Borrower pursuant to
Section 2.20 that are subsequently rescinded or avoided, or must
otherwise be restored or returned. Such liabilities shall be
unconditional and without regard to the occurrence of any Default or
Event of Default or the compliance by the Borrower with any of its
obligations under the Loan Documents. Each payment by a Lender of such
Commitment Percentage of the amount of such Letter of Credit or of any
amounts so rescinded, avoided, restored or returned shall be treated as
the making by such Lender of an automatic ABR Advance.
(b) The Agent will promptly notify each Lender (which notice
shall be promptly confirmed in writing) of the date and the amount of
any draft presented under any Letter of Credit with respect to which
full reimbursement of payment is not made by the Borrower as provided in
Section 2.18(c), and forthwith upon receipt of such notice, such Lender
(other than the Issuing Bank) shall make available to the Agent for the
account of the Issuing Bank its Commitment Percentage of the amount of
such unreimbursed draft (which shall constitute such Lender's automatic
ABR Advance) at the office of the Agent specified in Section 11.2, in
lawful money of the United States and in immediately available funds,
before 4:00 p.m., on the day such notice was given by the Agent, if the
relevant notice was given by the Agent at or prior to 1:00 p.m., on such
day, and before 12:00 p.m., on the next Business Day, if the relevant
notice was given by the Agent after 1:00 p.m., on such day. The Agent
shall distribute the payments made by each Lender pursuant to the
immediately preceding sentence to the Issuing Bank promptly upon receipt
thereof in like funds as received. Each Lender shall indemnify and hold
harmless the Agent and the Issuing Bank from and against any and all
losses, liabilities (including liabilities for penalties), actions,
suits, judgments, demands, costs and expenses (including, without
limitation, reasonable attorneys' fees and expenses and an
administration fee of not less than $100 payable to the Issuing Bank as
the issuer of the relevant Letter of Credit) resulting from any failure
on the part of such Lender to provide, or from any delay in providing,
the Agent with such Lender's Commitment Percentage of the amount of any
payment made by the Issuing Bank under a Letter of Credit in accordance
with this clause (b) above (except in respect of losses, liabilities or
other obligations suffered by the Issuing Bank resulting from the gross
negligence or willful misconduct of the Issuing Bank). If a Lender does
not make available to the Agent when due such Lender's Commitment
Percentage of any unreimbursed payment made by the Issuing Bank under a
Letter of Credit (other than payments made by the Issuing Bank by
reason of its gross negligence or willful misconduct), such Lender shall
be required to pay interest to the Agent for the account of the Issuing
Bank on such Lender's Commitment Percentage of such payment at a rate of
interest per annum equal to the Federal Funds Rate plus 1% from the date
such Lender's payment is due until the date such payment is received by
the Agent. The Agent shall distribute such interest payments to the
Issuing Bank upon receipt thereof in like funds as received. If the
Agent receives a Lender's Commitment Percentage of any unreimbursed
payment under a Letter of Credit after the date when due and the Agent
receives interest on any late payment from such Lender in accordance
with the provisions of the preceding sentence, such Lender's automatic
ABR Advance shall be deemed to have been made to the Borrower on the
date the Issuing Bank made payment under such Letter of Credit.
(c) Whenever the Agent is reimbursed by the Borrower, for the
account of the Issuing Bank, for any payment under a Letter of Credit
and such payment relates to an amount previously paid by a Lender in
respect of its Commitment Percentage of the amount of such payment under
such Letter of Credit, the Agent will pay over such payment to such
Lender (i) before 4:00 p.m. on the day such payment from the Borrower is
received, if such payment is received at or prior to 1:00 p.m. on such
day, or (ii) before 12:00 p.m. on the next succeeding Business Day, if
such payment from the Borrower is received after 1:00 p.m. on such day.
20. Absolute Obligation with respect to Letter of Credit Payments
The Borrower's obligation to reimburse the Agent for the account
of the Issuing Bank in respect of a Letter of Credit for each payment
under or in respect of such Letter of Credit shall be absolute and
unconditional under any and all circumstances and irrespective of any
set-off, counterclaim or defense to payment which the Borrower may have
or have had against the beneficiary of such Letter of Credit, the Agent,
the Issuing Bank, as issuer of such Letter of Credit, any Lender or any
other Person, including, without limitation, any defense based on the
failure of any drawing to conform to the terms of such Letter of Credit,
any drawing document proving to be forged, fraudulent or invalid, or the
legality, validity, regularity or enforceability of such Letter of
Credit; provided, however, that the Borrower shall not be obligated to
reimburse the Agent for the account of the Issuing Bank, as issuer of a
Letter of Credit, for any wrongful payment under such Letter of Credit
made as a result of the Issuing Bank's gross negligence or willful
misconduct.
21. Increased Costs Based on Letters of Credit
Without limiting the provisions of Section 2.12 but without
duplication of any amounts payable thereunder, if any law or regulation
or any change in the interpretation or application thereof by any
Governmental Authority charged with the administration thereof or GAAP
shall either (i) impose, modify or make applicable any reserve, special
deposit, assessment or similar requirement against letters of credit
issued or participated in by any Lender, or (ii) impose on the Agent or
such Lender any other condition regarding the Letters of Credit (except
for imposition of, or changes in the rate of, Tax on the Overall Net
Income of the Agent or such Lender) and the result of any event referred
to in clause (i) or (ii) above shall be to increase the cost to the
Issuing Bank (or any successor thereto as issuer of Letters of Credit)
of issuing or maintaining the Letters of Credit or the cost to any
Lender of making or maintaining any Loan pursuant to Section 2.18(c) or
its obligations pursuant to Section 2.19, or the cost to the Agent of
performing its functions hereunder with respect to the Letters of
Credit, in any case by an amount which the Agent, the Issuing Bank, or
any Lender, as the case may be, deems material, then, upon demand by the
Agent, the Issuing Bank or such Lender, as the case may be, the Borrower
shall immediately pay to the Agent, the Issuing Bank or such Lender, as
the case may be, from time to time as specified by the Agent, the
Issuing Bank or such Lender, additional amounts which shall be
sufficient to compensate the Agent, the Issuing Bank or such Lender, as
the case may be, for such increased cost, provided, however, that no
Lender shall be entitled to demand any payment under this Section 2.21
more than six months following the payment to or for the account of such
Lender of all other amounts payable hereunder and under any Note held by
such Lender and the termination of such Lender's Commitment; provided,
however, that the foregoing proviso shall in no way limit the right of
any Lender to demand or receive any payment under this Section 2.21 to
the extent that such payment relates to the retroactive application of
any law or regulation or any change in the interpretation or application
thereof if such demand is made within six months after the
implementation of such retroactive application. A statement in
reasonable detail as to such increased cost incurred by the Agent, the
Issuing Bank or such Lender, as the case may be, as a result of any
event mentioned in clauses (i) or (ii) above, submitted by the Agent,
the Issuing Bank or such Lender, as the case may be, to the Borrower
shall be conclusive, absent manifest error, as to the amount thereof.
22. Extension of Maturity Date
(a) Provided that no Default or Event of Default exists during
the periods set forth below, the Borrower may request that the Maturity
Date be extended for additional periods of one year each by giving
written notice of such request (each, an "Extension Request") to the
Agent during the period not more than 90 days but not less than 60 days
prior to the then Maturity Date and, upon the receipt of such notice,
the Agent shall promptly notify each Lender of such Extension Request.
(i) If all Lenders consent to an Extension Request during
the Extension Consent Period by giving written notice thereof to the
Borrower and the Agent, then, effective on the then current Maturity
Date, such Maturity Date shall be extended to the corresponding day of
the next following calendar year, provided, however, that if such day
falls on a day that is not a Business Day, such Maturity Date shall be
the next following Business Day.
(ii) If at least Extension Consent Required Lenders (but not
all Lenders) consent to an Extension Request during the Extension
Consent Period (by giving written notice thereof to the Borrower and the
Agent) the Maturity Date shall be extended to the corresponding day of
the next following calendar year (subject to the proviso in subsection
(a)(i) above) from and including the then current Maturity Date, with
respect to the Commitments of the Lenders consenting to such Extension
Request.
(iii) If Lenders (each a "Nonconsenting Lender") having
Commitments equal to less than 33 1/3% of the Aggregate Commitments
(without giving effect to any Loans outstanding) do not consent to an
Extension Request during the Extension Consent Period, the Borrower may
elect to (1) withdraw such Extension Request, (2) terminate the
Commitment of each Nonconsenting Lender effective on the then current
Maturity Date (with the Commitments of each other Consenting Lender
continuing in full force and effect) and, on such Maturity Date, pay to
the Agent for distribution to each such Nonconsenting Lender the
outstanding principal balance, if any, of the Notes of each such
Nonconsenting Lender, together with any accrued and unpaid interest
thereon to the date of such payment, any accrued and unpaid Facility
Fees due to such Lender, and any other amount due to such Lender
whereupon (A) effective on such then current Maturity Date, such
Maturity Date shall be extended to the corresponding day of the next
following calendar year (subject to the proviso in subsection (a)(i)
above), and (B) each Nonconsenting Lender shall cease to be a "Lender"
for all purposes of this Agreement (except with respect to its rights
hereunder to be reimbursed for costs and expenses in connection with,
and to indemnification with respect to, matters attributable to events,
acts or conditions occurring prior to such payment) and shall no longer
have any obligations hereunder, (3) request one or more of the
Consenting Lenders (each, a "Replacement Lender") to elect to increase
its Commitment by an amount up to the amount of the Commitment of such
Nonconsenting Lenders, or (4) designate another bank or banks (any such
bank, also a "Replacement Lender") acceptable to the Agent and the
Issuing Bank and willing to assume the Commitments of any such
Nonconsenting Lender or Lenders. Upon the Commitment of a Nonconsenting
Lender being assumed by a Replacement Lender under clauses (C) or (D)
above, effective on the then current Maturity Date or such earlier date
as shall be determined by the Borrower and the Agent, each such
Replacement Lender shall assume the Commitment of each such
Nonconsenting Lender by executing and delivering an Assignment and
Acceptance Agreement and, if such Nonconsenting Lender is the holder of
Notes, by purchasing such Notes of such Nonconsenting Lender, which
shall sell the same without recourse or warranty (except as to the
amount due thereon, its title to such Notes and its right to sell the
same) to such Replacement Lender at a price in immediately available
funds equal to the amount payable under clause (B) above, whereupon (x)
effective on the then current Maturity Date, such Maturity Date shall be
extended to the corresponding day of the next following calendar year
(subject to the proviso in subsection (a)(i) above), (y) each
Replacement Lender, if applicable, shall be deemed to be a "Lender" for
all purposes of this Agreement, and (z) each Nonconsenting Lender shall
cease to be a "Lender" for all purposes of this Agreement (except with
respect to its rights hereunder to be reimbursed for costs and expenses
in connection with, and to indemnification with respect to, matters
attributable to events, acts or conditions occurring prior to such
assumption and purchase) and shall no longer have any obligations
hereunder.
(iv) If Extension Consent Required Lenders do not consent to
an Extension Request during the Extension Consent Period, the Maturity
Date shall not be extended.
(v) Each Lender will use its best efforts to respond during
the Extension Consent Period to any Extension Request, provided that no
Lender's failure to so respond shall create any claim against it or have
the effect of extending the Maturity Date or such Lender's Commitment
beyond the Maturity Date.
(b) In the event the Borrower elects to terminate the Commitment
of a Nonconsenting Lender under Section 2.22(a)(iii)(B) above, the Agent
is authorized to amend Exhibit A, effective on the then current Maturity
Date, and promptly distribute a copy thereof to the Borrower and the
remaining Lenders (the "Consenting Lenders") reflecting the names of all
Consenting Lenders and Replacement Lenders and the new Commitment
Percentage of each such Consenting Lender and Replacement Lender (after
giving effect to the termination of each Nonconsenting Lender's
Commitment and the assumption by any Replacement Lender of such
Commitment).
(c) Notwithstanding anything to the contrary set forth herein,
in the event that at the time of an Extension Request, the Facility A
Credit Agreement is then in effect and the Borrower has requested an
extension of the Facility A Maturity Date pursuant thereto, then (i)
each Consenting Lender must consent to an extension of both this
Agreement and the Facility A Credit Agreement, (ii) each Nonconsenting
Lender whose Commitment is terminated shall also have its Facility A
Commitment terminated and (iii) each Replacement Lender which assumes
all or a portion of the Commitment of a Nonconsenting Lender shall
assume all or a like portion of such Nonconsenting Lender's Facility A
Commitment, it being the intention of the parties that at all times
during which this Agreement and the Facility A Credit Agreement are both
in effect, each Lender shall also be a Facility A Lender and its
Commitment Percentage shall equal its Facility A Commitment Percentage.
23. Change in Control
(a) The Borrower will notify the Agent and the Lenders in
writing within one Business Day after the occurrence of a Change in
Control. Upon receipt of such notice, each Lender shall have the right
to terminate its Commitment and Facility A Commitment within five
Business Days of the receipt of such notice. If a Lender so elects to
terminate its Commitment and Facility A Commitment, the Borrower shall,
not later than five Business Days after such Lender has given such
notice, repay such Lender's Loans and Facility A Loans together with any
accrued interest and fees and other amounts due such Lender under the
Loan Documents and the Facility A Loan Documents.
(b) Notwithstanding the foregoing, in lieu of terminating the
Commitments and Facility A Commitments of the Lenders and Facility A
Lenders as provided in subsection (a) hereof, the Borrower may request
one or more of the Lenders not terminating its Commitment and Facility A
Commitment (also, a "Replacement Lender") to elect to increase its
Commitment and Facility A Commitment by an amount up to the amount of
the Commitment and Facility A Commitment of such terminating Lender, or
may designate another bank or banks (any such bank, also a "Replacement
Lender") reasonably acceptable to the Agent and the Issuing Bank and
willing to assume the Commitments and Facility A Commitments of any such
terminating Lender or Lenders. Upon the Commitment and Facility A
Commitment of a terminating Lender being assumed by a Replacement
Lender, each such Replacement Lender shall assume the Commitment and
Facility A Commitment of each such terminating Lender by executing and
delivering an Assignment and Acceptance Agreement and, if such
terminating Lender is the holder of Notes or Facility A Notes, by
purchasing such Notes or Facility A Notes, as the case may be, of such
terminating Lender, which shall sell the same without recourse or
warranty (except as to the amount due thereon, its title to such Notes
or Facility A Notes, as the case may be, and its right to sell the same)
to such Replacement Lender at a price in immediately available funds
equal to the outstanding principal balance, if any, of the Notes and
Facility A notes, as the case may be, of each such terminating Lender,
together with any accrued and unpaid interest thereon to the date of
such payment, any accrued and unpaid fees due to such Lender hereunder
and under the Facility A Loan Documents, whereupon each Replacement
Lender shall be deemed to be a "Lender" for all purposes of this
Agreement, and (z) each terminating Lender shall cease to be a "Lender"
for all purposes of this Agreement (except with respect to its rights
hereunder and under the Facility A Loan Documents to be reimbursed for
costs and expenses in connection with, and to indemnification with
respect to, matters attributable to events, acts or conditions occurring
prior to such assumption and purchase) and shall no longer have any
obligations hereunder.
24. Agent's Records
The Agent's records regarding the amount of each Loan and Letter
of Credit, each payment by the Borrower of principal and interest on the
Loans and reimbursement obligations in respect of Letters of Credit and
other information relating to the Loans and the Letters of Credit shall
be presumptively correct absent manifest error.
C. FEES; PAYMENTS
1. Facility Fee
The Borrower agrees to pay to the Agent, for the account of the
Lenders in accordance with each Lender's Commitment Percentage, during
the period from and including the Effective Date through but excluding
the Maturity Date, a fee (the "Facility Fee") equal to the Applicable
Fee Percentage per annum of the average daily sum of the Aggregate
Commitments, regardless of usage, during such period. The Facility Fee
shall be payable (i) quarterly in arrears on the last day of each March,
June, September and December during such period, (ii) on the date of any
reduction in the Aggregate Commitments (to the extent of such reduction)
and (iii) on the Maturity Date. The Facility Fee shall be calculated on
the basis of a 360-day year for the actual number of days elapsed.
2. Letter of Credit Fees
The Borrower agrees to pay to the Agent, for the account of the
Lenders in accordance with each Lender's Commitment Percentage, a fee
(the "Letter of Credit Fee") with respect to each Letter of Credit for
the period from and including the date of issuance thereof to and
including the expiration date thereof, at a rate per annum equal to the
Applicable Margin on the average daily amount available to be drawn
under such Letter of Credit. The Letter of Credit Fee shall be (i)
calculated on the basis of a 360-day year for the actual number of days
elapsed, (ii) payable quarterly in arrears on the last day of each
March, June, September and December of each year and on the date that
the Aggregate Commitments shall expire and (iii) nonrefundable. In
addition to the Letter of Credit Fee, the Borrower agrees to pay to the
Issuing Bank, for its own account, its standard fees and charges
customarily charged to customers similar to the Borrower with respect to
any Letter of Credit.
3. Agent's Fees
The Borrower agrees to pay to the Agent, for its own account,
such other fees as have been agreed to in writing by the Borrower and
the Agent.
4. Pro Rata Treatment and Application of Principal Payments
Each payment, including each prepayment, of principal and
interest on the Loans, of the Facility Fee and the Letter of Credit Fees
shall be made by the Borrower to the Agent at its office set forth in
Section 11.2 in funds immediately available to the Agent at such office
by 12:00 p.m. on the due date for such payment, and, promptly upon
receipt thereof by the Agent, shall be remitted by the Agent in like
funds as received, to the Lenders according to the Commitment Percentage
of each Lender, in the case of the Facility Fee and the Letter of Credit
Fees and pro rata according to the aggregate outstanding principal
balance of the Loans, in the case of principal and interest due thereon.
The failure of the Borrower to make any such payment by such time shall
not constitute a default hereunder, provided that such payment is made
on such due date, but any such payment made after 12:00 p.m. on such due
date shall be deemed to have been made on the next Business Day for the
purpose of calculating interest on amounts outstanding on the Loans. If
any payment hereunder or under the Notes shall be due and payable on a
day which is not a Business Day, the due date thereof (except as
otherwise provided in the definition of Interest Period) shall be
extended to the next Business Day and (except with respect to payments
in respect of the Facility Fee and the Letter of Credit Fees) interest
shall be payable at the applicable rate specified herein during such
extension. If any payment is made with respect to any Eurodollar
Advance prior to the last day of the applicable Interest Period, the
Borrower shall indemnify each Lender in accordance with Section 2.13.
D. REPRESENTATIONS AND WARRANTIES
In order to induce the Agent and the Lenders to enter into this
Agreement and to make the Loans and the Issuing Bank to issue the
Letters of Credit and the Lenders to participate therein, the Borrower
makes the following representations and warranties to the Agent and each
Lender:
1. Subsidiaries
On the Effective Date, the Borrower has only the Subsidiaries set
forth on Schedule 4.1. The shares of each Subsidiary are duly
authorized, validly issued, fully paid and nonassessable and are owned
free and clear of any Liens.
2. Existence and Power
Each of the Borrower and its Subsidiaries is duly organized or
formed and validly existing in good standing under the laws of the
jurisdiction of its incorporation or formation, has all requisite power
and authority to own its Property and to carry on its business as now
conducted, and is in good standing and authorized to do business as a
foreign corporation in each jurisdiction in which the nature of the
business conducted therein or the Property owned therein makes such
qualification necessary, except where such failure to qualify, singly or
in the aggregate, could not reasonably be expected to have a Material
Adverse Effect.
3. Authority; Enforceability
The Borrower has full legal power and authority and has taken all
necessary actions, including, without limitation, any necessary
stockholder action, to enter into, execute, deliver and perform the
terms of the Loan Documents and to make the borrowings contemplated
hereby and by the Notes and to incur the obligations provided for herein
and therein, all of which have are in full compliance with its articles
of incorporation and by-laws or its other organization documents. The
Loan Documents (other than the Notes) constitute, and the Notes, when
issued and delivered pursuant hereto for value received, will
constitute, the valid and legally binding obligations of the Borrower,
enforceable in accordance with their respective terms, except as such
enforceability may be limited by applicable bankruptcy, insolvency,
reorganization or other similar laws affecting the enforcement of
creditors' rights generally.
4. Required Consents
Except for information filings required to be made in the
ordinary course of business which are not a condition to the Borrower's
performance under the Loan Documents, no consent, authorization or
approval of, filing with, notice to, or exemption by, stockholders, any
Governmental Authority or any other Person is required to authorize, or
is required in connection with the execution, delivery and performance
by the Borrower of the Loan Documents or is required as a condition to
the validity or enforceability of the Loan Documents against the
Borrower.
5. No Conflicting Agreements, Compliance with Laws; Taxes
On the initial Borrowing Date, (i) neither the Borrower nor any
of its Subsidiaries will be in default, (1) under any mortgage,
indenture, contract or agreement to which it is a party or by which it
or any of its Property is bound or (2) with respect to any judgment,
order, writ, injunction, decree or decision of any Governmental
Authority, the effect of which default could reasonably be expected to
have a Material Adverse Effect, and (ii) the execution, delivery or
carrying out of the terms of the Loan Documents will not constitute a
default under, or require the mandatory repayment of, or result in the
creation or imposition of, or obligation to create, any Lien upon any
Property of the Borrower or any of its Subsidiaries pursuant to the
terms of, any such mortgage, indenture, contract or agreement.
6. Franchises, Licenses, Etc.
Each of the Borrower and ACE possesses or has the right to use
all franchises, licenses, privileges and other rights that are material
and necessary for the conduct of its business, and with respect to which
it is in compliance, with no known conflict with the valid rights of
others which could reasonably be expected to have a Material Adverse
Effect.
7. Investment Company Act
The Borrower is not an "investment company" or a company
"controlled" by an "investment company" as defined in, or is otherwise
subject to regulation under, the Investment Company Act of 1940, as
amended.
8. Public Utility Status
The Borrower and each of its Subsidiaries are exempt from the
provisions of the Public Utility Holding Company Act of 1935, as
amended, except Section 9(a)(2) thereof, pursuant to Rule 2 of the
General Rules and Regulations of the SEC under said Act.
9. Federal Reserve Regulations; Use of Loan Proceeds
Neither the Borrower nor any of its Subsidiaries is engaged
principally, or as one of its important activities, in the business of
extending credit for the purpose of purchasing or carrying any Margin
Stock. No part of the proceeds of the Loans will be used, directly or
indirectly, for a purpose which violates any law, rule or regulation of
any Governmental Authority, including, without limitation, the
provisions of Regulations G, T, U or X of the Board of Governors of the
Federal Reserve System, as amended. No part of the proceeds of the
Loans will be used, directly or indirectly, to purchase or carry Margin
Stock or to extend credit to others for the purpose of purchasing or
carrying Margin Stock.
10. Litigation
Except as set forth in the Financial Statements or as disclosed
after the date of the Financial Statements in the most recent annual
report filed by the Borrower with the SEC pursuant to Section 13 or
15(d) of the Exchange Act, or in a quarterly or periodic report filed
with the SEC pursuant to Section 13 or 15(d) of the Exchange Act with
respect to a period or date subsequent to the end of the fiscal year
covered by such annual report, there are no actions, suits or
proceedings at law or in equity or by or before any Governmental
Authority (whether purportedly on behalf of the Borrower or any of its
Subsidiaries) pending or, to the knowledge of the Borrower, threatened
against the Borrower or any of its Subsidiaries or any of their
respective Properties or rights, which (i) reasonably may be expected to
have a Material Adverse Effect or (ii) call into question the validity
or enforceability of any of the Loan Documents.
11. Financial Statements
The Borrower has heretofore delivered to the Agent and the
Lenders copies of its Form 10-K for the fiscal year ending December 31,
1994, containing the audited Consolidated Balance Sheets of the Borrower
and its Subsidiaries and the related Consolidated Statements of
Operations, Stockholder's Equity and Cash Flows for the period then
ended, and its Form 10-Q for the fiscal quarter ended March 31, 1995,
containing the unaudited Consolidated Balance Sheet of the Borrower and
its Subsidiaries for such fiscal quarter, together with the related
Consolidated Statements of Operations and Cash Flows for the fiscal
quarter then ended (with the applicable related notes and schedules, the
"Financial Statements"). The Financial Statements have been prepared in
accordance with GAAP and fairly present the Consolidated financial
condition and results of the operations of the Borrower and its
Subsidiaries as of the dates and for the periods indicated therein.
Except as reflected in the Financial Statements or in the notes thereto,
neither the Borrower nor any of its Subsidiaries has any obligation or
liability of any kind (whether fixed, accrued, Contingent, unmatured or
otherwise) which, in accordance with GAAP, should have been shown on
the Financial Statements and was not. Since December 31, 1994, there
has been no Material Adverse Change.
12. Plans
The only Pension Plans in effect as of the Effective Date (the
"Existing Pension Plans") are listed on Schedule 4.12. Each Employee
Benefit Plan of the Borrower, its Subsidiaries and their respective
ERISA Affiliates is in compliance with ERISA and the Code, where
applicable, in all material respects and there is no event or condition
existing or anticipated under or with respect to any Existing Pension
Plan that could have a Material Adverse Effect.
13. Ownership of Property; Liens
The Borrower has good and marketable title to, or a valid
leasehold interest in, all of its Property, subject to no Liens, except
Permitted Liens, and each Subsidiary has good and marketable title to,
or a valid leasehold interest in, all of its Property, except to the
extent that the failure to have such title or leasehold interest could
not reasonably be expected to have a Material Adverse Effect.
14. Security Interests
The Pledge Agreement is effective to create in favor of the
Agent, for (i) the benefit of the Agent and the Facility A Agent and for
the ratable benefit of the Lenders and the Facility A Lenders, a legal,
valid and enforceable security interest in the Collateral, and, on and
after the taking of possession of the Intercompany Notes by the Agent as
collateral agent, and assuming the continued possession thereof by the
Agent as collateral agent, the security interest granted by the Pledge
Agreement shall at all times constitute a fully perfected Lien on, and
security interest in, all right, title and interest of the Borrower in
such Collateral, in each case prior and superior in right to any other
Person.
15. Environmental Matters
Except as disclosed in the most recent report filed by the
Borrower with the SEC pursuant to Section 13 or 15(d) of the Exchange
Act, or in a quarterly or periodic report filed with the SEC pursuant to
Section 13 or 15(d) of the Exchange Act with respect to a period or date
subsequent to the end of the fiscal year covered by such annual report,
(i) the Borrower and each of its Subsidiaries is in compliance with the
requirements of all applicable Environmental Laws, noncompliance with
which reasonably may be expected to have a Material Adverse Effect, (ii)
there have been no releases or disposals of hazardous wastes, hazardous
substances or other substances in quantities or locations which might
result in the Borrower or any of its Subsidiaries incurring any remedial
obligations under applicable law which could, either singly or in the
aggregate, reasonably be expected to have Material Adverse Effect, and
(iii) neither the Borrower nor any of its Subsidiaries has received
notice or order advising it that it has or may have any remedial
obligation with respect to any such releases or disposals or that it is
or may be responsible for the costs of any remedial action taken or to
be taken by any other Persons with respect to any such releases or
disposals, which obligation or cost, if fully payable could, either
singly or in the aggregate, reasonably may be expected to have Material
Adverse Effect.
16. Certain Business Activities
The Borrower does not engage in any business other than the
holding of Permitted Investments.
E. CONDITIONS TO FIRST LOANS OR THE ISSUANCE OF FIRST LETTERS OF
CREDIT
In addition to the conditions precedent set forth in Section 6,
the obligation of each Lender to make its first Revolving Credit Loan,
any Lender to make the first Competitive Bid Loan or the Issuing Bank to
issue the first Letter of Credit, in each case on the first Borrowing
Date, and the Lenders to participate therein, shall be subject to the
fulfillment of the following conditions precedent:
1. Evidence of Action
The Agent shall have received a certificate, dated the Effective
Date, of the Secretary or Assistant Secretary of the Borrower (i)
attaching a true and complete copy of the resolutions of its Board of
Directors and of all documents evidencing other necessary corporate
action (in form and substance satisfactory to the Agent) taken by it to
authorize the Loan Documents and the transactions contemplated thereby,
(ii) attaching a true and complete copy of its articles of incorporation
and by-laws, (iii) setting forth the incumbency of its officer or
officers who may sign the Loan Documents, including therein a signature
specimen of such officer or officers and (iv) attaching a certificate of
good standing of the Secretary of State of the jurisdiction of its
incorporation and of each other jurisdiction in which it is qualified to
do business.
2. This Agreement; Notes
The Agent shall have received (i) counterparts of this Agreement
signed by each of the parties hereto (or receipt by the Agent from a
party hereto of a fax signature page signed by such party which shall
have agreed to promptly provide the Agent with originally executed
counterparts hereof) and (ii) for each Lender, a Revolving Credit Note
and a Competitive Bid Note, duly executed by an Authorized Signatory of
the Borrower.
3. Certificate as to Approvals and Liens
The Agent shall have received a certificate of an Authorized
Signatory of the Borrower certifying that (i) all approvals and consents
of all Persons required to be obtained in connection with the
consummation of the transactions contemplated by the Loan Documents and
the Facility A Loan Documents have been duly obtained and are in full
force and effect, and that all required notices have been given and all
required waiting periods have expired and (ii) upon the making of the
first Loans under the Agreement and under the Facility A Loan Documents
there will exist no Liens on the Collateral other than Liens in favor of
the Facility A Agent, the Facility A Lenders, the Agent and the Lenders
under the Pledge Agreement.
4. Pledge Agreement
The Agent shall have received the Pledge Agreement, duly executed
by an Authorized Signatory of the Borrower, together with Intercompany
Notes duly executed by each Operating Subsidiary, duly indorsed by the
Borrower to the order of the Agent, as collateral agent for itself, the
Lenders, the Facility A Agent and the Facility A Lenders.
5. Facility A Loan Documents
Each of the Facility A Credit Agreement and the Facility A Notes
shall have been duly executed and delivered by the parties thereto.
6. Other Credit Facilities
(a) The Revolving Credit Commitment under the ATE Credit
Agreement shall have been permanently reduced to an amount not in excess
of $25,000,000, and the Agent shall have received satisfactory evidence
thereof; and
(b) The Borrower shall have paid, or made arrangements
satisfactory to the Agent to pay on the Borrowing Date, with the
proceeds of a Loan under this Agreement or a borrowing under the
Facility B Credit Agreement, or both, all principal and accrued interest
due to BNY under the Borrower's $20,000,000 unsecured line of credit
with BNY.
7. ACE Preferred Stock
The Agent shall have received a copy of the relevant portions of
the charter of ACE, and of each certificate of designation filed
pursuant to such charter, setting forth the terms applicable to each
class and series of the ACE Preferred Stock outstanding on the Effective
Date, certified by an Authorized Signatory of the Borrower to be a true
and complete copy thereof, and such terms shall be satisfactory to the
Agent.
8. Opinions of Counsel
The Agent shall have received (i) an opinion of Ballard Spahr
Andrews & Ingersoll, counsel to the Borrower, and (ii) an opinion of
James E. Franklin II, Esq., general counsel of the Borrower, in each
case addressed to the Facility A Agent, the Facility A Lenders, the
Agent, the Lenders and Special Counsel and dated the Effective Date,
covering the matters set forth in Exhibit N and satisfactory in form and
substance to the Agent.
9. Opinion of Special Counsel
The Agent shall have received an opinion of Special Counsel,
addressed to the Facility A Agent, the Facility A Lenders, the Agent,
the Lenders and Special Counsel, substantially in the form of Exhibit O.
10. Fees
All fees payable to the Agent on the first Borrowing Date, and
the fees and expenses of Special Counsel incurred and recorded to date
in connection with the preparation, negotiation and closing of the Loan
Documents, shall have been paid.
F. CONDITIONS OF LENDING - ALL LOANS AND LETTERS OF CREDIT
The obligation of each Lender to make any Loan or the Issuing Bank to
issue any Letter of Credit on a Borrowing Date and each Lender to
participate therein is subject to the satisfaction of the following
conditions precedent as of the date of such Loan or the issuance of such
Letter of Credit, as the case may be:
1. Compliance
On each Borrowing Date and after giving effect to the Loans to be
made, or the Letters of Credit to be issued, thereon, (i) the Borrower
shall have complied with all of the terms, covenants and conditions of
this Agreement relating to such Loans or Letters of Credit, (ii) there
shall exist no Event of Default, (iii) the representations and
warranties contained in the Loan Documents shall be true and correct
with the same effect as though such representations and warranties had
been made on such Borrowing Date except to the extent such
representations and warranties specifically relate to an earlier date,
in which case such representations and warranties shall have been true
and correct in all material respects on and as of such earlier date, and
(iv) the Aggregate Credit Exposure will not exceed the Aggregate
Commitments. Each borrowing by the Borrower and each request by the
Borrower for the issuance of a Letter of Credit shall constitute a
certification by the Borrower as of such Borrowing Date that each of the
foregoing matters is true and correct in all respects.
2. Borrowing Request; Competitive Bid Request
In the case of the borrowing of Revolving Credit Loans, the Agent
shall have received a Borrowing Request, and in the case of a borrowing
of a Competitive Bid Loan, the Agent shall have received a Competitive
Bid Request and such other documents required to be delivered by the
Borrower pursuant to Section 2.4, in each case duly executed by an
Authorized Signatory of the Borrower.
3. Letter of Credit Request
With respect to the issuance of each Letter of Credit, the Agent
shall have received a Letter of Credit Request duly executed by an
Authorized Signatory of the Borrower.
G. AFFIRMATIVE COVENANTS
The Borrower agrees that, so long as this Agreement is in effect, any
Loan or reimbursement obligations (contingent or otherwise) in respect
of any Letter of Credit remains outstanding and unpaid, or any other
amount is owing under any Loan Document to any Lender or the Agent, the
Borrower shall:
1. Financial Statements
Maintain a standard system of accounting in accordance with GAAP,
and furnish or cause to be furnished to the Agent and each Lender:
(a) As soon as available, but in any event not later than 5
days after the due date thereof, or if an extension of time to file
has been obtained by the Borrower pursuant to Rule 12b-25 under the
Exchange Act, not later than 5 days after the expiration of such
extension, (i) a complete copy of the Borrower's Annual Report on Form
10-K in respect of each fiscal year as filed by the Borrower with the
SEC, together with a copy all financial statements and financial
statement schedules incorporated therein by reference, and (ii) a
complete copy of the Borrower's Quarterly Report on Form 10-Q in
respect of each fiscal quarter as filed by the Borrower with the SEC,
together with a copy of any financial statements incorporated therein
by reference.
(b) Within 45 days after the end of each of the first three
fiscal quarters (90 days after the end of the last fiscal quarter), a
Compliance Certificate, duly executed by the chief financial officer
of the Borrower (or such other officer as may be reasonably acceptable
to the Agent).
(c) Such other information as the Agent or any Lender may
reasonably request from time to time.
2. Certificates; Other Information
Furnish to the Agent and each Lender:
(a) Prompt written notice if any Default or Event of
Default shall have occurred and be continuing;
(b) Promptly upon becoming available, copies of all (i)
annual reports to shareholders, proxy statements and other materials
(other than reports specified in Section 7.1) which the Borrower or
any of its Subsidiaries may now or hereafter be required to file with
or deliver to any securities exchange or the SEC, or any other
Governmental Authority succeeding to the functions thereof and (ii)
material news releases and annual reports relating to the Borrower or
any of its Subsidiaries;
(c) Prompt written notice of any change by either Moody's
or S&P in the Senior Debt Rating;
(d) Prompt written notice of any agreement, indenture or
other document or instrument entered into by, or which becomes binding
upon, ACE which restricts or has the effect of restricting the payment
by ACE of dividends with respect to its Stock;
(e) Prompt written notice of the forgiveness of any
Intercompany Note or the conversion thereof to Stock or other
instruments, in each case to the extent permitted by Section 8.6,
together with a total of all such forgiveness or conversions
since the Effective Date; and
(f) Such other information as the Agent or any Lender shall
reasonably request from time to time.
3. Legal Existence
Maintain, and cause each of its Restricted Subsidiaries so to
maintain, its legal existence in good standing in the jurisdiction of
its incorporation or formation and in each other jurisdiction in which
the failure so to do could reasonably be expected to have a Material
Adverse Effect.
4. Taxes
Pay and discharge when due, and cause each of its Restricted
Subsidiaries so to do, all Taxes, assessments and governmental charges,
license fees and levies upon, or with respect to the Borrower, such
Restricted Subsidiary and all Taxes upon the income, profits and
Property of the Borrower and its Restricted Subsidiaries which if
unpaid, could reasonably be expected to have a Material Adverse Effect
or become a Lien on the Property of the Borrower or such Restricted
Subsidiary (other than a Lien described in Section 8.2(i)), unless and
to the extent only that such Taxes, assessments, charges, license fees
and levies shall be contested in good faith and by appropriate
proceedings diligently conducted by the Borrower or such Restricted
Subsidiary and provided that any such contested Tax, assessment, charge,
license fee or levy shall not constitute, or create, a Lien on any
Property of the Borrower or such Restricted Subsidiary senior to the
Liens granted to the Agent and the Lenders under the Pledge Agreement on
such Property, and, provided further, that the Borrower shall give the
Agent prompt notice of such contest and that such reserve or other
appropriate provision as shall be required by the Accountants in
accordance with GAAP shall have been made therefor.
5. Insurance
Maintain, and cause each of its Restricted Subsidiaries to
maintain insurance on all its Property in at least such amounts and
against at least such risks (but including in any event public
liability, product liability and business interruption coverage) as is
consistent with industry standards followed by companies engaged in the
same business; and furnish to the Agent, upon written request, full
information as to insurance policies and reserves for self insurance.
6. Condition of Property
At all times, maintain, protect and keep in good repair, working
order and condition (ordinary wear and tear excepted), and cause each of
its Restricted Subsidiaries so to do, all Property necessary to the
operation of the Borrower's or such Restricted Subsidiary's business.
7. Observance of Legal Requirements
Observe and comply, and cause each of its Restricted Subsidiaries
so to do, with all laws, ordinances, orders, judgments, rules,
regulations, certifications, franchises, permits, licenses, directions
and requirements of all Governmental Authorities, which now or at any
time hereafter may be applicable to it, including, without limitation,
ERISA and all Environmental Laws, noncompliance with which could
reasonably be expected to have a Material Adverse Effect.
8. Inspection of Property; Books and Records; Discussions
Keep proper books of record and account in which full, true and
correct entries in conformity with GAAP and all requirements of law
shall be made of all dealings and transactions in relation to its
business and activities and permit representatives of the Agent and any
Lender to visit its offices, to inspect any of its Property and examine
and make copies or abstracts from any of its books and records at any
reasonable time and as often as may reasonably be desired, and to
discuss the business, operations, prospects, licenses, Property and
financial condition of the Borrower and its Restricted Subsidiaries with
the officers thereof and the Accountants.
9. Licenses, Franchises, Intellectual Property, Etc.
Obtain or maintain, as applicable, and cause ACE to obtain or
maintain, as applicable, in full force and effect, all licenses,
franchises, Intellectual Property, permits, authorizations and other
rights as are necessary for the conduct of its business and the failure
of which to obtain or maintain could reasonably be expected to have a
Material Adverse Effect.
10. Indebtedness Capitalization Ratio
Maintain as of the last day of each fiscal quarter of the
Borrower, an Indebtedness Capitalization Ratio of less than or equal to
0.65:1.00.
11. Ratio of Indebtedness to Annualized ACE Dividends
Maintain at all times, a ratio of (i) Indebtedness of the
Borrower to (ii) Annualized ACE Dividends of less than or equal to
2.50:1.00.
H. NEGATIVE COVENANTS
The Borrower agrees that, so long as this Agreement is in effect, any
Loan or reimbursement obligations (contingent or otherwise) in respect
of any Letter of Credit remains outstanding and unpaid, or any other
amount is owing under any Loan Document to any Lender or the Agent, the
Borrower shall not:
1. Indebtedness
Create, incur, assume or suffer to exist any liability for
Indebtedness except (i) Indebtedness due under the Loan Documents and
the Facility A Loan Documents, (ii) Indebtedness of the Borrower
existing on the date hereof as set forth on Schedule 8.1, excluding
increases and refinancings thereof, (iii) provided that no Default or
Event of Default would exist before and after giving effect thereto,
Contingent Obligations of the Borrower not in excess of $70,000,000 in
respect of Indebtedness for borrowed money of Atlantic Thermal or any of
its Subsidiaries in connection with its District Heating and Cooling
Project, provided that any Contingent Obligation of the Borrower with
respect to such Indebtedness is unsecured and (iv) provided no Default
or Event of Default would exist before and after giving effect thereto
other Indebtedness and Contingent Obligations of the Borrower in an
aggregate amount not in excess of $10,000,000 provided that any such
Indebtedness constituting a Contingent Obligation shall be unsecured.
2. Liens
Create, incur, assume or suffer to exist any Lien upon any of its
Property, whether now owned or hereafter acquired except (i) Liens for
Taxes, assessments or similar charges incurred in the ordinary course of
business which are not delinquent or which are being contested in
accordance with Section 7.4, provided that enforcement of such Liens is
stayed pending such contest, (ii) Liens in connection with workers'
compensation, unemployment insurance or other social security
obligations (but not ERISA), (iii) deposits or pledges to secure bids,
tenders, contracts (other than contracts for the payment of money),
leases, statutory obligations, surety and appeal bonds and other
obligations of like nature arising in the ordinary course of business,
(iv) zoning ordinances, easements, rights of way, minor defects,
irregularities, and other similar restrictions affecting real Property
which do not adversely affect the value of such real Property or the
financial condition of the Borrower or impair its use for the operation
of the business of the Borrower, (v) Liens arising by operation of law
such as mechanics', materialmen's, carriers', warehousemen's liens
incurred in the ordinary course of business which are not delinquent or
which are being contested in good faith and by appropriate proceedings
diligently conducted by it, provided that enforcement of such Liens is
stayed pending such contest, (vi) Liens arising out of judgments or
decrees which are being contested in good faith and by appropriate
proceedings diligently conducted by it, provided that enforcement of
such Liens is stayed pending such contest, (vii) Liens in favor of the
Agent and the Lenders under the Loan Documents and the Facility A Agent
and the Facility A Lenders under the Facility A Loan Documents, (viii)
Liens on Property of the Borrower existing on the Effective Date as set
forth on Schedule 8.2 as renewed from time to time, but not any
increases in the amounts secured thereby, (ix) Liens on Property of the
Borrower acquired after the Effective Date provided that such Liens are
limited to the Property so acquired and were not created in
contemplation of such acquisition and (x) Liens securing Indebtedness
for borrowed money (or Contingent Obligations in connection therewith)
of the Borrower provided that the Agent, the Lenders, the Facility A
Agent and the Facility A Lenders are ratably secured pursuant to
documentation in form and substance satisfactory to the Agent and the
Facility A Agent.
3. Merger; Consolidation
(a) Consolidate with, be acquired by, or merge into or with any
Person, or permit any of its Restricted Subsidiaries so to do, except
that if no Default or Event of Default would exist before and after
giving effect thereto, (i) the Borrower or any Restricted Subsidiary may
merge with another entity provided that the resulting corporation shall
have a net worth not less than the net worth of the Borrower or
Restricted Subsidiary involved in such merger, (ii) the entity to be
merged with is in the same business as a Restricted Subsidiary of the
Borrower or in a related business (including other types of utilities),
(iii) in the case of a merger involving the Borrower, the Borrower is
the survivor and (iv) in the case of a merger involving an Operating
Subsidiary, the survivor (if not such Operating Subsidiary) shall assume
the obligations of such Operating Subsidiary under the Intercompany Note
theretofore delivered by such Operating Subsidiary to the Borrower by an
instrument in form and substance satisfactory to the Agent.
(b) Sell, lease or otherwise dispose of all or any part of its
Property, or enter into any sale-leaseback transaction except:
(i) Sales or other dispositions of inventory in the
ordinary course of business;
(ii) Sales or other dispositions of equipment and materials
in the ordinary course of business which, in the reasonable opinion of
the Borrower, is obsolete or no longer useful in the conduct of its
business; and
(iii) Sales or other dispositions of other Property for
consideration not in excess of $25,000,000 per sale or other
disposition provided that no Default or Event of Default shall exist
immediately before or after giving effect thereto.
4. Restricted Payments
Declare or pay any Restricted Payments payable in cash or
otherwise or apply any of its Property thereto or set apart any sum
therefor, or permit any of its Restricted Subsidiaries so to do, except
that (i) a Restricted Subsidiary may declare and pay Restricted Payments
to its parent or to the Borrower, (ii) provided that no Default or Event
of Default has occurred and is then continuing or would occur giving
effect thereto, (1) the Borrower may (1) declare and pay cash dividends
on its common Stock in any fiscal year and (2) repurchase its Stock, and
(2) ACE may declare and pay cash dividends on, and make mandatory and
optional sinking fund payments with respect to, the ACE Preferred Stock.
5. Investments, Acquisitions, Loans, Etc.
At any time, purchase or otherwise acquire, hold or invest in the
Stock of, or any other interest in, any Person, or make any loan or
advance to, or enter into any arrangement for the purpose of providing
funds or credit to, or make any other investment, whether by way of
capital contribution, time deposit or otherwise, in or with any Person,
or make any Acquisition (all of which are sometimes referred to herein
as "Investments") except:
(a) Investments in (i) obligations issued or guaranteed by
the United States Government, (ii) obligations of Federal agencies;
(iii) State general obligation or revenue bonds having a rating category
not less than Aa or AA by Moody's or S&P, respectively; (iv) State bond
anticipation, tax anticipation or revenue anticipation notes having a
rating category not less than MIG-2 or AA by Moody's or S&P,
respectively; (v) any of the following which, by their terms, mature
within twelve months from the date of issuance: (1) commercial paper
rated not less than Prime-1 or A-1 by Moody's or S&P, respectively; (2)
bankers' acceptance drawn on and accepted by Approved Financial
Institutions; (3) certificates of deposit issued by Approved Financial
Institutions and (4) money market mutual funds investing in securities
rated as "First Tier Eligible Securities" by Moody's or S&P.
(b) Investments existing on the Effective Date as set forth
on Schedule 8.5.
(c) Investments consisting of Intercompany Loans to
Operating Subsidiaries, provided that (i) no Default or Event of Default
shall exist before and after giving effect thereto and (ii) such
Operating Subsidiary shall have executed and delivered to the Borrower
an Intercompany Note, which Intercompany Note shall be in form and
substance satisfactory to the Agent, shall have been duly indorsed by
the Borrower to the order of the Agent, as collateral agent for itself,
the Lenders, the Facility A Agent and the Facility A Lenders and shall
have been delivered to the Agent, as such collateral agent.
(d) Investments consisting of loans to Permitted
Recipients, provided that (i) no Default or Event of Default shall exist
before and after giving effect thereto, and (ii) the aggregate amount of
all such Investments shall not exceed $10,000,000.
(e) Acquisitions provided that (i) no Default or Event of
Default shall exist before and after giving effect thereto, (ii) the
Person or business to be acquired is in the same or a related business
to a Subsidiary of the Borrower (including other types of utilities) or
the assets or to be acquired are devoted to or usable in such a business
and (iii) no more than $25,000,000 of proceeds of Loans are used
therefor.
(f) Equity Investments in Operating Subsidiaries, provided
(i) that no Default or Event of Default would exist before or after
giving effect thereto and (ii) not more than $20,000,000 of such
Investments in the aggregate shall be made with the proceeds of Loans or
the forgiveness of Indebtedness or the conversion to equity of any such
Indebtedness, in each case to the extent permitted by Section 8.6.
6. Amendments, Etc. of Intercompany Notes
Enter into or agree to any amendment, modification or waiver of
any term or condition of any Intercompany Note or forgive all or any
portion of any amount due thereunder or convert all or any portion
thereof into Stock or other interests or instruments, provided, however,
that if no Default or Event of Default exists before and after giving
effect thereto, the Borrower may so convert or forgive such Intercompany
Note or Intercompany Notes not in excess of $20,000,000 in the
aggregate, provided further that any such conversion or forgiveness in
excess thereof may only be made if the Agent shall have received 30 days
prior written notice thereof and the Operating Subsidiary whose
Intercompany Note is to be forgiven or converted shall have executed and
delivered to the Agent a guaranty substantially in the form of Exhibit Q
hereto, together with such legal opinions, certificates and other
documents as the Agent reasonably may request, each in form and
substance satisfactory to the Agent.
7. Designation of Operating Subsidiaries
Designate any Subsidiary as an additional Operating Subsidiary to
whom proceeds of Loans may be loaned by the Borrower unless (i) no
Default or Event of Default shall exist before or after giving effect
thereto, (ii) the prospective Operating Subsidiary is a Subsidiary of
the Borrower, (iii) the prospective Operating Subsidiary is engaged in
the conduct of an active trade or business, (iv) the prospective
Operating Subsidiary executes an Intercompany Note, in favor of the
Borrower and in form and substance satisfactory to the Agent, evidencing
its obligation to repay Intercompany Loans made to it by the Borrower
from time to time, which Intercompany Note has been duly indorsed by the
Borrower to the order of the Agent, as collateral agent for itself, the
Lenders, the Facility A Agent and the Facility A Lenders, and (v) the
Agent shall have received a written certificate signed by an Authorized
Signatory of the Borrower designating such Operating Subsidiary and
certifying as to its status as described in clauses (ii) and (iii)
above.
8. Certain Business Activities
Engage in any business other than the holding of Permitted
Investments.
I. DEFAULT
1. Events of Default
The following shall each constitute an "Event of Default"
hereunder:
(a) The failure of the Borrower to pay any installment of
principal on any Note or reimbursement obligations in respect of any
Letter of Credit on the date when due and payable; or
(b) The failure of the Borrower to pay any installment of
interest or any other fees or expenses payable under any Loan Document
or otherwise to the Agent with respect to the loan facilities
established hereunder within three Business Days of the date when due
and payable; or
(c) The use of the proceeds of any Loan in a manner
inconsistent with or in violation of Section 2.15; or
(d) The failure of the Borrower to observe or perform any
covenant or agreement contained in Sections 7.3, 7.10, 7.11 or Section
8; or
(e) The failure of the Borrower to observe or perform any
other term, covenant, or agreement contained in any Loan Document and
such failure shall have continued unremedied for a period of 30 days
after the Borrower shall have obtained knowledge thereof; or
(f) Any representation or warranty made in any Loan
Document or in any certificate delivered or to be delivered pursuant
thereto shall prove to have been incorrect or misleading (whether
because of misstatement or omission) in any material respect when made;
or
(g) Obligations of the Borrower (other than its obligations
under the Notes), ACE or any of any Operating Subsidiary, whether as
principal, guarantor, surety or other obligor, for the payment of any
Indebtedness or operating leases in excess of $10,000,000 in the
aggregate (i) shall become or shall be declared to be due and payable
prior to the expressed maturity thereof, or (ii) shall not be paid when
due or within any grace period for the payment thereof, or (iii) the
holders of any such obligations shall have the right to declare such
obligation due and payable prior to the expressed maturity thereof;
(h) The Borrower, ACE or any Operating Subsidiary shall (i)
suspend or discontinue its business, (ii) make an assignment for the
benefit of creditors, (iii) generally not be paying its debts as such
debts become due, (iv) admit in writing its inability to pay its debts
as they become due, (v) file a voluntary petition in bankruptcy, (vi)
become insolvent (however such insolvency shall be evidenced), (vii)
file any petition or answer seeking for itself any reorganization,
arrangement, composition, readjustment of debt, liquidation or
dissolution or similar relief under any present or future statute, law
or regulation of any jurisdiction, (viii) petition or apply to any
tribunal for any receiver, custodian or any trustee for any substantial
part of its Property, (ix) be the subject of any such proceeding filed
against it which remains undismissed for a period of 60 days, (x) file
any answer admitting or not contesting the material allegations of any
such petition filed against it or any order, judgment or decree
approving such petition in any such proceeding, (xi) seek, approve,
consent to, or acquiesce in any such proceeding, or in the appointment
of any trustee, receiver, sequestrator, custodian, liquidator, or fiscal
agent for it, or any substantial part of its Property, or an order is
entered appointing any such trustee, receiver, custodian, liquidator or
fiscal agent and such order remains in effect for 60 days, or (xii) take
any formal action for the purpose of effecting any of the foregoing or
looking to the liquidation or dissolution of the Borrower or such
Subsidiary; or
(i) An order for relief is entered under the United States
bankruptcy laws or any other decree or order is entered by a court
having jurisdiction (i) adjudging the Borrower, ACE or any Operating
Subsidiary bankrupt or insolvent, (ii) approving as properly filed a
petition seeking reorganization, liquidation, arrangement, adjustment or
composition of or in respect of the Borrower or any of its Subsidiaries
under the United States bankruptcy laws or any other applicable Federal
or state law, (iii) appointing a receiver, liquidator, assignee,
trustee, custodian, sequestrator (or other similar official) of the
Borrower or any of its Subsidiaries or of any substantial part of the
Property thereof, or (iv) ordering the winding up or liquidation of the
affairs of the Borrower or any of its Subsidiaries, and any such decree
or order continues unstayed and in effect for a period of 60 days; or
(j) Judgments or decrees against the Borrower or any of its
Subsidiaries aggregating in excess of $10,000,000 shall remain unpaid,
unstayed on appeal, undischarged, unbonded or undismissed for a period
of 30 consecutive days from the entry thereof; or
(k) Any Loan Document shall cease, for any reason, to be in
full force and effect or the Borrower shall so assert in writing or
shall disavow any of its obligations thereunder; or
(l) The occurrence of an Event of Default under and as
defined in the Pledge Agreement; or
(m) The occurrence of an Event of Default under and as
defined in any Facility A Loan Document; or
(n) The Borrower shall own less than 100% of the issued and
outstanding common Stock of ACE; or
(o) (i) any Termination Event shall occur; (ii) any
Accumulated Funding Deficiency, whether waived, shall exist with respect
to any Pension Plan; (iii) any Person shall engage in any Prohibited
Transaction involving any Employee Benefit Plan; (iv) the Borrower, any
of its Subsidiaries or any ERISA Affiliate shall fail to pay when due an
amount which is payable by it to the PBGC or to a Pension Plan under
Title IV of ERISA; or (v) any other event or condition shall occur or
exist with respect to an Employee Benefit Plan; and the occurrence of
any of such events would have a Material Adverse Effect.
Upon the occurrence of an Event of Default or at any time
thereafter during the continuance thereof, (a) if such event is an Event
of Default specified in clause (h) or (i) above, the Aggregate
Commitments and the Letter of Credit Commitment shall immediately and
automatically terminate and the Loans, all accrued and unpaid interest
thereon, any reimbursement obligations owing or contingently owing in
respect of all outstanding Letters of Credit and all other amounts owing
under the Loan Documents shall immediately become due and payable, and
the Borrower shall forthwith deposit an amount equal to the Letter of
Credit Exposure in a cash collateral account with and under the
exclusive control of the Agent, and the Agent may, and, upon the
direction of the Required Lenders shall, exercise any and all remedies
and other rights provided in the Loan Documents, and (b) if such event
is any other Event of Default, any or all of the following actions may
be taken: (i) with the consent of the Required Lenders, the Agent may,
and upon the direction of the Required Lenders shall, by notice to the
Borrower, declare the Aggregate Commitments and the Letter of Credit
Commitment to be terminated forthwith, whereupon the Aggregate
Commitments and the Letter of Credit Commitment shall immediately
terminate, and (ii) with the consent of the Required Lenders, the Agent
may, and upon the direction of the Required Lenders shall, by notice of
default to the Borrower, declare the Loans, all accrued and unpaid
interest thereon, any reimbursement obligations owing or contingently
owing in respect of all outstanding Letters of Credit and all other
amounts owing under the Loan Documents to be due and payable forthwith,
whereupon the same shall immediately become due and payable, and the
Borrower shall forthwith deposit an amount equal to the Letter of Credit
Exposure in a cash collateral account with and under the exclusive
control of the Agent, and the Agent may, and upon the direction of the
Required Lenders shall, exercise any and all remedies and other rights
provided pursuant to the Loan Documents. Except as otherwise provided
in this Section, presentment, demand, protest and all other notices of
any kind are hereby expressly waived. The Borrower hereby further
expressly waives and covenants not to assert any appraisement,
valuation, stay, extension, redemption or similar laws, now or at any
time hereafter in force which might delay, prevent or otherwise impede
the performance or enforcement of any Loan Document.
In the event that the Aggregate Commitments and the Letter of
Credit Commitment shall have been terminated or the Notes shall have
been declared due and payable pursuant to the provisions of this
Section, any funds received by the Agent and the Lenders from or on
behalf of the Borrower shall be applied by the Agent and the Lenders in
liquidation of the Loans and the obligations of the Borrower under the
Loan Documents in the following manner and order, in each case pro rata
in proportion to the amounts due to each Person entitled to payment: (i)
first, to the payment of interest on, and then the principal portion of,
any Loans which the Agent may have advanced on behalf of any Lender for
which the Agent has not then been reimbursed by such Lender or the
Borrower; (ii) second, to the payment of any fees or expenses due the
Agent from the Borrower, (iii) third, to reimburse the Agent and the
Lenders for any expenses (to the extent not paid pursuant to clause (ii)
above due from the Borrower pursuant to the provisions of Section 11.5;
(iv) fourth, to the payment of accrued Facility Fees, Letter of Credit
Fees and all other fees, expenses and amounts due under the Loan
Documents (other than principal and interest on the Notes); (v) fifth,
to the payment of interest due on the Notes; (vi) sixth, to the payment
of principal outstanding on the Revolving Credit Notes and under the
Reimbursement Agreements; (vii) seventh, to the payment of principal
outstanding on the Competitive Bid Notes; and (viii) eighth, to the
payment of any other amounts owing to the Agent and the Lenders under
any Loan Document.
J. THE AGENT
1. Appointment
Each Lender hereby irrevocably designates and appoints BNY as the
Agent of such Lender under the Loan Documents and each such Lender
hereby irrevocably authorizes BNY, as the Agent for such Lender, to take
such action on its behalf under the provisions of the Loan Documents and
to exercise such powers and perform such duties as are expressly
delegated to the Agent by the terms of the Loan Documents, together with
such other powers as are reasonably incidental thereto. Notwithstanding
any provision to the contrary elsewhere in any Loan Document, the Agent
shall not have any duties or responsibilities other than those expressly
set forth therein, or any fiduciary relationship with any Lender, and no
implied covenants, functions, responsibilities, duties, obligations or
liabilities shall be read into the Loan Documents or otherwise exist
against the Agent.
2. Delegation of Duties
The Agent may execute any of its duties under the Loan Documents
by or through agents or attorneys-in-fact and shall be entitled to rely
upon the advice of counsel concerning all matters pertaining to such
duties.
3. Exculpatory Provisions
Neither the Agent nor any of its officers, directors, employees,
agents, attorneys-in-fact or affiliates shall be (i) liable for any
action lawfully taken or omitted to be taken by it or such Person under
or in connection with the Loan Documents (except the Agent for its own
gross negligence or willful misconduct), or (ii) responsible in any
manner to any of the Lenders for any recitals, statements,
representations or warranties made by the Borrower or any officer
thereof contained in the Loan Documents or in any certificate, report,
statement or other document referred to or provided for in, or received
by the Agent under or in connection with, the Loan Documents or for the
value, validity, effectiveness, genuineness, perfection, enforceability
or sufficiency of any of the Loan Documents or for any failure of the
Borrower or any other Person to perform its obligations thereunder. The
Agent shall not be under any obligation to any Lender to ascertain or to
inquire as to the observance or performance of any of the agreements
contained in, or conditions of, the Loan Documents, or to inspect the
properties, books or records of the Borrower. The Agent shall not be
under any liability or responsibility whatsoever, as Agent, to the
Borrower or any other Person as a consequence of any failure or delay in
performance, or any breach, by any Lender of any of its obligations
under any of the Loan Documents.
4. Reliance by Agent
The Agent shall be entitled to rely, and shall be fully protected
in relying, upon any writing, resolution, notice, consent, certificate,
affidavit, opinion, letter, cablegram, telegram, fax, telex or teletype
message, statement, order or other document or conversation believed by
it to be genuine and correct and to have been signed, sent or made by
the proper Person or Persons and upon advice and statements of legal
counsel (including, without limitation, counsel to the Borrower),
independent accountants and other experts selected by the Agent. The
Agent may treat each Lender, or the Person designated in the last notice
filed with it under this Section, as the holder of all of the interests
of such Lender in its Loans and in its Notes until written notice of
transfer, signed by such Lender (or the Person designated in the last
notice filed with the Agent) and by the Person designated in such
written notice of transfer, in form and substance satisfactory to the
Agent, shall have been filed with the Agent. The Agent shall not be
under any duty to examine or pass upon the validity, effectiveness,
enforceability, perfection or genuineness of the Loan Documents or any
instrument, document or communication furnished pursuant thereto or in
connection therewith, and the Agent shall be entitled to assume that the
same are valid, effective and genuine, have been signed or sent by the
proper parties and are what they purport to be. The Agent shall be
fully justified in failing or refusing to take any action under the Loan
Documents unless it shall first receive such advice or concurrence of
the Required Lenders as it deems appropriate. The Agent shall in all
cases be fully protected in acting, or in refraining from acting, under
the Loan Documents in accordance with a request or direction of the
Required Lenders, and such request or direction and any action taken or
failure to act pursuant thereto shall be binding upon all the Lenders
and all future holders of the Notes.
5. Notice of Default
The Agent shall not be deemed to have knowledge or notice of the
occurrence of any Default or Event of Default unless the Agent has
received written notice thereof from a Lender or the Borrower. In the
event that the Agent receives such a notice, the Agent shall promptly
give notice thereof to the Lenders and the Borrower. The Agent shall
take such action with respect to such Default or Event of Default as
shall be directed by the Required Lenders, provided, however, that
unless and until the Agent shall have received such directions, the
Agent may (but shall not be obligated to) take such action, or refrain
from taking such action, with respect to such Default or Event of
Default as it shall deem to be in the best interests of the Lenders.
6. Non-Reliance on Agent and Other Lenders
Each Lender expressly acknowledges that neither the Agent nor any
of its respective officers, directors, employees, agents, attorneys-
in-fact or affiliates has made any representations or warranties to it
and that no act by the Agent hereinafter, including any review of the
affairs of the Borrower, shall be deemed to constitute any
representation or warranty by the Agent to any Lender. Each Lender
represents to the Agent that it has, independently and without reliance
upon the Agent or any other Lender, and based on such documents and
information as it has deemed appropriate, made its own evaluation of and
investigation into the business, operations, Property, financial and
other condition and creditworthiness of the Borrower and made its own
decision to enter into this Agreement. Each Lender also represents that
it will, independently and without reliance upon the 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 analyses,
evaluations and decisions in taking or not taking action under any Loan
Document, and to make such investigation as it deems necessary to inform
itself as to the business, operations, Property, financial and other
condition and creditworthiness of the Borrower. Except for notices,
reports and other documents expressly required to be furnished to the
Lenders by the Agent hereunder, the Agent shall not have any duty or
responsibility to provide any Lender with any credit or other
information concerning the business, operations, Property, financial and
other condition or creditworthiness of the Borrower which may come into
the possession of the Agent or any of its officers, directors,
employees, agents, attorneys-in-fact or affiliates.
7. Indemnification
Each Lender agrees to indemnify and reimburse the Agent in its
capacity as such (to the extent not promptly reimbursed by the Borrower
and without limiting the obligation of the Borrower to do so), pro rata
according to the outstanding principal balance of the Loans (or at any
time when no Loans are outstanding, according to its Commitment
Percentage), from and against any and all liabilities, obligations,
losses, damages, penalties, actions, judgments, suits, costs, expenses
or disbursements of any kind whatsoever including, without limitation,
any amounts paid to the Lenders (through the Agent) by the Borrower
pursuant to the terms of the Loan Documents, that are subsequently
rescinded or avoided, or must otherwise be restored or returned) which
may at any time (including, without limitation, at any time following
the payment of the Notes) be imposed on, incurred by or asserted against
the Agent in any way relating to or arising out of the Loan Documents or
any other documents contemplated by or referred to therein or the
transactions contemplated thereby or any action taken or omitted to be
taken by the Agent under or in connection with any of the foregoing;
provided, however, that no Lender shall be liable for the payment of any
portion of such liabilities, obligations, losses, damages, penalties,
actions, judgments, suits, costs, expenses or disbursements to the
extent resulting solely from the finally adjudicated gross negligence or
willful misconduct of the Agent. Without limitation of the foregoing,
each Lender agrees to reimburse the Agent promptly upon demand for its
pro rata share of any unpaid fees owing to the Agent, and any costs and
expenses (including, without limitation, reasonable fees and expenses of
counsel) payable by the Borrower under Section 11.5, to the extent that
the Agent has not been paid such fees or has not be reimbursed for such
costs and expenses by the Borrower. The failure of any Lender to
reimburse the Agent promptly upon demand for its pro rata share of any
amount required to be by the Lenders to the Agent as provided in this
Section shall not relieve any other Lender of its obligation hereunder
to reimburse the Agent for its pro rata share of such amount, but no
Lender shall be responsible for the failure of other Lender to reimburse
the Agent for such other Lender's pro rata share of such amount. The
agreements in this Section shall survive the payment of all amounts
payable under the Loan Documents.
8. Agent in Its Individual Capacity
BNY and its respective affiliates may make loans to, accept
deposits from, issue letters of credit for the account of, and generally
engage in any kind of business with, the Borrower as though BNY were not
Agent hereunder. With respect to the Commitment made or renewed by BNY
and the Notes issued to BNY, BNY shall have the same rights and powers
under the Loan Documents as any Lender and may exercise the same as
though it were not the Agent, and the terms "Lender" and "Lenders" shall
in each case include BNY.
9. Successor Agent
If at any time the Agent deems it advisable, in its sole
discretion, it may submit to each of the Lenders a written notice of its
resignation as Agent under the Loan Documents, such resignation to be
effective upon the earlier of (i) the written acceptance of the duties
of the Agent under the Loan Documents by a successor Agent and (ii) on
the 30th day after the date of such notice. Upon any such resignation,
the Required Lenders shall have the right, with the prior written
consent of the Borrower (which consent shall not be unreasonably
withheld or delayed and which consent of the Borrower shall not be
required upon the occurrence and during the continuance of a Default or
an Event of Default), to appoint from among the Lenders a successor
Agent. If no successor Agent shall have been so appointed by the
Required Lenders and accepted such appointment in writing within 30 days
after the retiring Agent's giving of notice of resignation, then the
retiring Agent may, on behalf of the Lenders, appoint a successor Agent,
which successor Agent shall be a commercial bank organized under the
laws of the United States of America or any State thereof and having a
combined capital, surplus, and undivided profits of at least
$100,000,000. Upon the acceptance of any appointment as Agent hereunder
by a successor Agent, such successor Agent shall thereupon succeed to
and become vested with all the rights, powers, privileges and duties of
the retiring Agent, and the retiring Agent's rights, powers, privileges
and duties as Agent under the Loan Documents shall be terminated. The
Borrower and the Lenders shall execute such documents as shall be
necessary to effect such appointment. After any retiring Agent's
resignation as Agent, the provisions of the Loan Documents shall inure
to its benefit as to any actions taken or omitted to be taken by it
while it was Agent under the Loan Documents. If at any time there shall
not be a duly appointed and acting Agent, the Borrower agrees to make
each payment due under the Loan Documents directly to the Lenders
entitled thereto during such time.
K. OTHER PROVISIONS
1. Amendments and Waivers
With the written consent of the Required Lenders, the Agent and
the Borrower may, from time to time, enter into written amendments,
supplements or modifications of the Loan Documents and, with the consent
of the Required Lenders, the Agent on behalf of the Lenders may execute
and deliver to any such parties a written instrument waiving or a
consent to a departure from, on such terms and conditions as the Agent
may specify in such instrument, any of the requirements of the Loan
Documents or any Default or Event of Default and its consequences;
provided, however, that:
(a) no such amendment, supplement, modification, waiver or
consent shall, without the written consent of all of the Lenders, (i)
increase the Commitment of any Lender or the Aggregate Commitments, (ii)
extend the Maturity Date (except as provided in Section 2.22); (iii)
decrease the rate, or extend the time of payment, of interest of, or
change or forgive the principal amount of, or change the pro rata
allocation of payments under, any Note; (iv) release all or any part of
the Collateral; (v) change the provisions of Sections 3.4, 11.1 or
11.7(a) or (vi) change the definition of Required Lenders;
(b) without the written consent of the Issuing Bank, no such
amendment, supplement, modification or waiver shall change the Letter of
Credit Commitment, change the amount or the time of payment of the
Letter of Credit Fees or change any other term or provision which
relates to the Letter of Credit Commitment or the Letters of Credit; and
(c) without the written consent of BNY, no such amendment,
supplement, modification or waiver shall amend, modify or waive any
provision of Section 10 or otherwise change any of the rights or
obligations of the Agent hereunder or under the Loan Documents.
Any such amendment, supplement, modification or waiver shall
apply equally to each of the Lenders and shall be binding upon the
parties to the applicable Loan Document, the Lenders, the Agent and all
future holders of the Notes. In the case of any waiver, the parties to
the applicable Loan Document, the Lenders and the Agent shall be
restored to their former position and rights hereunder and under the
outstanding Notes and other Loan Documents to the extent provided for in
such waiver, and any Default or Event of Default waived shall not extend
to any subsequent or other Default or Event of Default, or impair any
right consequent thereon. The Loan Documents may not be amended orally
or by any course of conduct.
2. Notices
All notices, requests and demands to or upon the respective
parties to the Loan Documents to be effective shall be in writing and,
unless otherwise expressly provided therein, shall be deemed to have
been duly given or made when delivered by hand, or when deposited in the
mail, first-class postage prepaid, or, in the case of notice by fax,
when sent, addressed as follows in the case of the Borrower or the
Agent, at the Domestic Lending Office, in the case of each Lender, or to
such other addresses as to which the Agent may be hereafter notified by
the respective parties thereto or any future holders of the Notes:
The Borrower:
Atlantic Energy, Inc.
6801 Black Horse Pike
Pleasantville, New Jersey 08232-4130
Attention: Louis M. Walters,
Treasurer
Telephone: (609) 645-4441
Fax: (609) 645-4550
The Agent:
The Bank of New York
One Wall Street
Agency Function Administration
18th Floor
New York, New York 10286
Attention: Patricia Clancy
Telephone: (212) 635-4696
Fax: (212) 635-6365 or 6366 or 6367
with a copy to:
The Bank of New York
Energy Industries Division
One Wall Street
19th Floor
New York, New York 10286
Attention: Mary Lou Bradley,
Vice President
Telephone: (212) 635-7533
Fax: (212) 635-7923
except that any notice, request or demand by the Borrower to or upon the
Agent or the Lenders pursuant to Sections 2.3, 2.4 or 2.7 shall not be
effective until received. Any party to a Loan Document may rely on
signatures of the parties thereto which are transmitted by fax or other
electronic means as fully as if originally signed.
3. No Waiver; Cumulative Remedies
No failure to exercise and no delay in exercising, on the part of
the Agent or any Lender, any right, remedy, power or privilege under any
Loan Document shall operate as a waiver thereof; nor shall any single or
partial exercise of any right, remedy, power or privilege under any Loan
Document preclude any other or further exercise thereof or the exercise
of any other right, remedy, power or privilege. The rights, remedies,
powers and privileges under the Loan Documents are cumulative and not
exclusive of any rights, remedies, powers and privileges provided by
law.
4. Survival of Representations and Warranties
All representations and warranties made under the Loan Documents
and in any document, certificate or statement delivered pursuant thereto
or in connection therewith shall survive the execution and delivery of
the Loan Documents.
5. Payment of Expenses and Taxes
The Borrower agrees, promptly upon presentation of a statement or
invoice therefor, and whether any Loan is made (i) to pay or reimburse
the Agent for all its out-of-pocket costs and expenses reasonably
incurred in connection with the development, preparation, execution and
syndication of, the Loan Documents and any amendment, supplement or
modification thereto (whether or not executed), any documents prepared
in connection therewith and the consummation of the transactions
contemplated thereby, including, without limitation, the reasonable fees
and disbursements of Special Counsel, (ii) to pay or reimburse the Agent
and the Lenders for all of their respective costs and expenses,
including, without limitation, reasonable fees and disbursements of
counsel, incurred in connection with (1) any Default or Event of Default
and any enforcement or collection proceedings resulting therefrom or in
connection with the negotiation of any restructuring or "work-out"
(whether consummated or not) of the obligations of the Borrower under
any of the Loan Documents and (2) the enforcement of this Section, (iii)
to pay, indemnify, and hold each Lender and the Agent harmless from and
against, any and all recording and filing fees and any and all
liabilities with respect to, or resulting from any delay in paying,
stamp, excise and other similar taxes, if any, which may be payable or
determined to be payable in connection with the execution and delivery
of, or consummation of any of the transactions contemplated by, or any
amendment, supplement or modification of, or any waiver or consent under
or in respect of, the Loan Documents and any such other documents, and
(iv) to pay, indemnify and hold each Lender and the Agent and each of
their respective officers, directors and employees harmless from and
against any and all other liabilities, obligations, claims, losses,
damages, penalties, actions, judgments, suits, costs, expenses or
disbursements of any kind or nature whatsoever (including, without
limitation, reasonable counsel fees and disbursements) with respect to
the enforcement and performance of the Loan Documents and the
enforcement and performance of the provisions of any subordination
agreement in favor of the Agent and the Lenders (all the foregoing,
collectively, the "indemnified liabilities") and, if and to the extent
that the foregoing indemnity may be unenforceable for any reason, the
Borrower agrees to make the maximum payment permitted or not prohibited
under applicable law; provided, however, that the Borrower shall have no
obligation hereunder to pay indemnified liabilities to the Agent or any
Lender arising from the finally adjudicated gross negligence or willful
misconduct of the Agent or such Lender or claims between one indemnified
party and another indemnified party. The agreements in this Section
shall survive the termination of the Aggregate Commitments and the
payment of all amounts payable under the Loan Documents.
6. Lending Offices
Each Lender shall have the right at any time and from time to
time to transfer its Loans to a different office, provided that such
Lender shall promptly notify the Agent and the Borrower of any such
change of office. Such office shall thereupon become such Lender's
Domestic Lending Office or Eurodollar Lending Office, as the case may
be, provided, however, that no such Lender shall be entitled to receive
any greater amount under Sections 2.10, 2.12, 2.13 and 2.21 as a result
of a transfer of any such Loans to a different office of such Lender
than it would be entitled to immediately prior thereto unless such claim
would have arisen even if such transfer had not occurred.
7. Assignments and Participations
(a) The Loan Documents shall be binding upon and inure to the
benefit of the Borrower, the Lenders, the Agent, all future holders of
the Notes and their respective successors and assigns, except that the
Borrower may not assign, delegate or transfer any of its rights or
obligations under the Loan Documents without the prior written consent
of the Agent, the Issuing Bank and each Lender.
(b) Each Lender shall have the right at any time, upon written
notice to the Agent of its intent to do so, to sell, assign, transfer or
negotiate all or any part of such Lender's rights under the Loan
Documents and the Facility A Loan Documents to one or more of its
affiliates, to one or more of the other Lenders (or to affiliates of
such other Lenders) or, with the prior written consent of the Borrower,
the Agent and the Issuing Bank (which consent shall not be unreasonably
withheld or delayed and which consent of the Borrower shall not be
required upon the occurrence and during the continuance of an Event of
Default), to sell, assign, transfer or negotiate all or any part of such
Lender's rights and obligations under the Loan Documents and the
Facility A Loan Documents to any other bank, insurance company, pension
fund, mutual fund or other financial institution, provided that (i) each
such sale, assignment, transfer or negotiation (other than sales,
assignments, transfers or negotiations (x) to affiliates of such Lender
or (y) of a Lender's entire interest) shall be in a minimum amount of
$5,000,000, (ii) each such sale, assignment, transfer or negotiation
shall be of an equal percentage of such Lenders interest under the Loan
Documents and the Facility A Loan Documents (it being the intention of
the parties that at all times during which the Loan Documents and the
Facility A Loan Documents are both in effect, each Lender shall also be
a Facility A Lender and its Commitment Percentage shall equal its
Facility A Commitment Percentage) and (iii) there shall be paid to the
Agent by the assigning Lender a fee (the "Assignment Fee") of $3,000 for
the assignment of both the Loan Documents and the Facility A Loan
Documents. For each assignment, the parties to such assignment shall
execute and deliver to the Agent for its acceptance and recording an
Assignment and Acceptance Agreement. Upon such execution, delivery,
acceptance and recording by the Agent, from and after the effective date
specified in such Assignment and Acceptance Agreement, the assignee
thereunder shall be a party hereto and, to the extent provided in such
Assignment and Acceptance Agreement, the assignor Lender thereunder
shall be released from its obligations under the Loan Documents. The
Borrower agrees upon written request of the Agent and at the Borrower's
expense to execute and deliver (1) to such assignee, a Revolving Credit
Note, dated the effective date of such Assignment and Acceptance
Agreement, in an aggregate principal amount equal to the Loans assigned
to, and Commitments assumed by, such assignee, (2) to such assignee, a
Competitive Bid Note, dated the effective date of such Assignment and
Acceptance Agreement and (3) to such assignee, a Revolving Credit Note,
dated the effective date of such Assignment and Acceptance Agreement, in
an aggregate principal amount equal to the balance of such assignor
Lender's Revolving Credit Loans and Commitments, if any, and each
assignor Lender shall cancel and return to the Borrower its existing
Revolving Credit Note. Upon any such sale, assignment or other
transfer, the Commitments and the Commitment Percentages set forth in
Exhibit A shall be adjusted accordingly by the Agent.
(c) Each Lender may grant participations in all or any part of
its Loans, its Notes and its Commitment to one or more banks, insurance
companies, financial institutions, pension funds or mutual funds,
provided that (i) such Lender's obligations under the Loan Documents
shall remain unchanged, (ii) such Lender shall remain solely responsible
to the other parties to the Loan Documents for the performance of such
obligations, (iii) the Borrower, the 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 the Loan Documents, (iv) no
sub-participations shall be permitted and (v) the voting rights of any
holder of any participation shall be limited to decisions that only do
any of the following: (1) subject the participant to any additional
obligation, (2) reduce the principal of, or interest on the Notes or any
fees or other amounts payable hereunder, (3) postpone any date fixed for
the payment of principal of, or interest on the Notes or any fees or
other amounts payable hereunder, (4) release any security interest or
Collateral except to the extent that such release is specifically
provided for in any Loan Document or (5) release any guarantor under any
guarantee. The Borrower acknowledges and agrees that any such
participant shall for purposes of Sections 2.10, 2.12, 2.13, 2.16 and
2.21 be deemed to be a "Lender"; provided, however, the Borrower shall
not, at any time, be obligated to pay any participant in any interest of
any Lender hereunder any sum in excess of the sum which the Borrower
would have been obligated to pay to such Lender in respect of such
interest had such Lender not sold such participation.
(d) If any (i) assignment is made pursuant to subsection (b)
above or (ii) any participation is granted pursuant to subsection (c)
above, shall be made to any Person that is not a U.S. Person, such
Person shall furnish such certificates, documents or other evidence to
the Borrower and the Agent, in the case of clause (i) and to the
Borrower and the Lender which sold such participation in the case of
clause (ii), as shall be required by Section 2.10(e).
(e) No Lender shall, as between and among the Borrower, the
Agent and such Lender, be relieved of any of its obligations under the
Loan Documents as a result of any sale, assignment, transfer or
negotiation of, or granting of participations in, all or any part of its
Loans, its Commitment or its Note, except that a Lender shall be
relieved of its obligations to the extent of any such sale, assignment,
transfer, or negotiation of all or any part of its Loans, its Commitment
or its Notes pursuant to subsection (b) above.
(f) Notwithstanding anything to the contrary contained in this
Section, any Lender may at any time or from time to time assign all or
any portion of its rights under the Loan Documents to a Federal Reserve
Bank, provided that any such assignment shall not release such assignor
from its obligations thereunder.
8. Counterparts
Each Loan Document (other than the Notes) may be executed by one
or more of the parties thereto on any number of separate counterparts
and all of said counterparts taken together shall be deemed to
constitute one and the same document. It shall not be necessary in
making proof of any Loan Document to produce or account for more than
one counterpart signed by the party to be charged. A counterpart of any
Loan Document or to any document evidencing, and of any an amendment,
modification, consent or waiver to or of any Loan Document transmitted
by fax shall be deemed to be an originally executed counterpart. A set
of the copies of the Loan Documents signed by all the parties thereto
shall be deposited with each of the Borrower and the Agent. Any party
to a Loan Document may rely upon the signatures of any other party
thereto which are transmitted by fax or other electronic means to the
same extent as if originally signed.
9. Adjustments; Set-off
(a) If any Lender (a "Benefited Lender") shall at any time
receive any payment of all or any part of its Loans, or interest
thereon, or receive any collateral in respect thereof (whether
voluntarily or involuntarily, by set-off, pursuant to events or
proceedings of the nature referred to in Section 9.1 (h) or (i), or
otherwise) in a greater proportion than any such payment to and
collateral received by any other Lender in respect of such other
Lender's Loans, or interest thereon, such Benefited Lender shall
purchase for cash from each of the other Lenders such portion of each
such other Lender's Loans, and shall provide each of such other Lenders
with the benefits of any such collateral, or the proceeds thereof, as
shall be necessary to cause such Benefited Lender to share the excess
payment or benefits of such collateral or proceeds ratably with each of
the Lenders, provided, however, that if all or any portion of such
excess payment or benefits is thereafter recovered from such Benefited
Lender, such purchase shall be rescinded, and the purchase price and
benefits returned, to the extent of such recovery, but without interest.
The Borrower agrees that each Lender so purchasing a portion of another
Lender's Loans may exercise all rights of payment (including, without
limitation, rights of set-off, to the extent not prohibited by law) with
respect to such portion as fully as if such Lender were the direct
holder of such portion.
(b) In addition to any rights and remedies of the Lenders
provided by law, upon the occurrence of an Event of Default and the
acceleration of the obligations owing in connection with the Loan
Documents, or at any time upon the occurrence and during the continuance
of an Event of Default, under Section 9.1(a) or (b), each Lender shall
have the right, without prior notice to the Borrower, any such notice
being expressly waived by the Borrower to the extent not prohibited by
applicable law, to set-off and apply against any indebtedness, whether
matured or unmatured, of the Borrower to such Lender, any amount owing
from such Lender to the Borrower, at, or at any time after, the
happening of any of the above-mentioned events. To the extent not
prohibited by applicable law, the aforesaid right of set-off may be
exercised by such Lender against the Borrower or against any trustee in
bankruptcy, custodian, debtor in possession, assignee for the benefit of
creditors, receiver, or execution, judgment or attachment creditor of
the Borrower, or against anyone else claiming through or against the
Borrower or such trustee in bankruptcy, custodian, debtor in possession,
assignee for the benefit of creditors, receiver, or execution, judgment
or attachment creditor, notwithstanding the fact that such right of set-
off shall not have been exercised by such Lender prior to the making,
filing or issuance, or service upon such Lender of, or of notice of, any
such petition, assignment for the benefit of creditors, appointment or
application for the appointment of a receiver, or issuance of execution,
subpoena, order or warrant. Each Lender agrees promptly to notify the
Borrower and the Agent 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.
10. Indemnity
The Borrower agrees to indemnify and hold harmless the Agent and
each Lender and their respective affiliates, directors, officers,
employees, attorneys and agents (each an "Indemnified Person") from and
against any loss, cost, liability, damage or expense (including the
reasonable fees and disbursements of counsel of such Indemnified Person,
including all local counsel hired by any such counsel) incurred by such
Indemnified Person in investigating, preparing for, defending against,
or providing evidence, producing documents or taking any other action in
respect of, any commenced or threatened litigation, administrative
proceeding or investigation under any federal securities law or any
other statute of any jurisdiction, or any regulation, or at common law
or otherwise, which is alleged to arise out of or is based upon (i) any
untrue statement or alleged untrue statement of any material fact by the
Borrower in any document or schedule executed or filed with any
Governmental Authority by or on behalf of the Borrower; (ii) any
omission or alleged omission to state any material fact required to be
stated in such document or schedule, or necessary to make the statements
made therein, in light of the circumstances under which made, not
misleading; (iii) any acts, practices or omissions or alleged acts,
practices or omissions of the Borrower or its agents relating to the use
of the proceeds of any or all borrowings made by the Borrower which are
alleged to be in violation of Section 2.15, or in violation of any
federal securities law or of any other statute, regulation or other law
of any jurisdiction applicable thereto; or (iv) any acquisition or
proposed acquisition by the Borrower of all or a portion of the Stock,
or all or a portion of the assets, of any Person whether such
Indemnified Person is a party thereto. The indemnity set forth herein
shall be in addition to any other obligations or liabilities of the
Borrower to each Indemnified Person under the Loan Documents or at
common law or otherwise, and shall survive any termination of the Loan
Documents, the expiration of the Aggregate Commitments and the payment
of all indebtedness of the Borrower under the Loan Documents, provided
that the Borrower shall have no obligation under this Section to an
Indemnified Person with respect to any of the foregoing to the extent
found in a final judgment of a court having jurisdiction to have
resulted primarily out of the gross negligence or wilful misconduct of
such Indemnified Person or arising solely from claims between one such
Indemnified Person and another such Indemnified Person.
11. Governing Law
The Loan Documents and the rights and obligations of the parties
thereunder shall be governed by, and construed and interpreted in
accordance with, the internal laws of the State of New York, without
regard to principles of conflict of laws.
12. Headings Descriptive
Section headings have been inserted in the Loan Documents for
convenience only and shall not be construed to be a part thereof.
13. Severability
Every provision of the Loan Documents is intended to be
severable, and if any term or provision thereof shall be invalid,
illegal or unenforceable for any reason, the validity, legality and
enforceability of the remaining provisions thereof shall not be
affected or impaired thereby, and any invalidity, illegality or
unenforceability in any jurisdiction shall not affect the validity,
legality or enforceability of any such term or provision in any other
jurisdiction.
14. Integration
All exhibits to a Loan Document shall be deemed to be a part
thereof. Except for agreements between the Agent and the Borrower with
respect to certain fees, the Loan Documents embody the entire agreement
and understanding among the Borrower, the Agent and the Lenders with
respect to the subject matter thereof and supersede all prior agreements
and understandings among the Borrower, the Agent and the Lenders with
respect to the subject matter thereof.
15. Consent to Jurisdiction
The Borrower hereby irrevocably submits to the jurisdiction of
any New York State or Federal court sitting in the City of New York over
any suit, action or proceeding arising out of or relating to the Loan
Documents. The Borrower hereby irrevocably waives, to the fullest
extent permitted or not prohibited by law, any objection which it may
now or hereafter have to the laying of the venue of any such suit,
action or proceeding brought in such a court and any claim that any such
suit, action or proceeding brought in such a court has been brought in
an inconvenient forum. The Borrower hereby agrees that a final judgment
in any such suit, action or proceeding brought in such a court, after
all appropriate appeals, shall be conclusive and binding upon it.
16. Service of Process
The Borrower hereby irrevocably consents to the service of
process in any suit, action or proceeding by sending the same by first
class mail, return receipt requested or by overnight courier service, to
the address of the Borrower set forth in Section 11.2. The Borrower
hereby agrees that any such service (i) shall be deemed in every respect
effective service of process upon it in any such suit, action, or
proceeding, and (ii) shall to the fullest extent enforceable by law, be
taken and held to be valid personal service upon and personal delivery
to it.
17. No Limitation on Service or Suit
Nothing in the Loan Documents or any modification, waiver,
consent or amendment thereto shall affect the right of the Agent or any
Lender to serve process in any manner permitted by law or limit the
right of the Agent or any Lender to bring proceedings against the
Borrower in the courts of any jurisdiction or jurisdictions in which the
Borrower may be served.
18. WAIVER OF TRIAL BY JURY
THE AGENT, THE LENDERS AND THE BORROWER HEREBY KNOWINGLY,
VOLUNTARILY AND INTENTIONALLY WAIVE ANY RIGHT IT MAY HAVE TO A TRIAL BY
JURY IN RESPECT OF ANY LITIGATION ARISING OUT OF, UNDER OR IN CONNECTION
WITH THE LOAN DOCUMENTS OR THE TRANSACTIONS CONTEMPLATED THEREIN.
FURTHER, THE BORROWER
HEREBY CERTIFIES THAT NO REPRESENTATIVE OR AGENT OF THE
AGENT, OR THE
LENDERS, OR COUNSEL TO THE AGENT OR THE LENDERS, HAS REPRESENTED,
EXPRESSLY OR OTHERWISE, THAT THE AGENT OR THE LENDERS WOULD NOT, IN THE
EVENT OF SUCH LITIGATION, SEEK TO ENFORCE THIS WAIVER OF RIGHT TO JURY
TRIAL PROVISION. THE BORROWER ACKNOWLEDGES THAT THE AGENT AND THE
LENDERS HAVE BEEN INDUCED TO ENTER INTO THIS AGREEMENT BY, INTER ALIA,
THE PROVISIONS OF THIS SECTION.
[Remainder of page intentionally left blank]
IN WITNESS WHEREOF, the parties hereto have caused this Revolving
Credit Agreement (Facility B) to be duly executed and delivered by their
proper and duly authorized officers as of the day and year first above
written.
ATLANTIC ENERGY, INC.
By: /s/ Jerrold L. Jacobs
Name: Jerrold L. Jacobs
Title: President & Chief
Executive Officer
THE BANK OF NEW YORK,
Individually and as Agent
By: /s/ Mary Lou Bradley
Name: Mary Lou Bradley
Title: Vice President
THE FIRST NATIONAL BANK
OF CHICAGO
By /s/ Kenneth J. Bauer
Name: Kenneth J. Bauer
Title: Authorized Agent
MELLON BANK, N.A.
By: /s/ A. Gary Chace
Name: A. Gary Chace
Title: Senior Vice President
ATLANTIC ENERGY EXHIBIT A
LIST OF COMMITMENTS
(Facility B)
Commitment
Lender Commitment Percentage
The Bank of New York $21,334,000 53.3350%
The First National Bank $13,333,000 33.3325%
of Chicago
Mellon Bank, N.A. $ 5,333,000 13.3325%
Total $40,000,000 100.0000%
ATLANTIC ENERGY EXHIBIT B-1
FORM OF REVOLVING CREDIT NOTE
(Facility B)
$______________ , 1995
New York, New York
FOR VALUE RECEIVED, on the Maturity Date, ATLANTIC ENERGY, INC.,
a New Jersey corporation (the "Borrower"), hereby promises to pay
to the order of ________________ (the "Lender"), at the office of
THE BANK OF NEW YORK, as Agent (the "Agent"), located at One Wall
Street, New York, New York or at such other place as the Agent may
specify from time to time, in lawful money of the United States of
America, the principal sum of $_____, or such lesser unpaid
principal balance as shall be outstanding hereunder, together with
interest from the date hereof, on the unpaid principal balance
hereof, payable at the rate or rates and at the time or times
provided for in the Revolving Credit Agreement (Facility B), dated
as of September 28, 1995, among the Borrower, the Lenders party
thereto and the Agent (as the same may be amended, modified or
supplemented from time to time, the "Agreement"). Capitalized
terms used herein that are defined in the Agreement shall have the
meanings therein defined. In no event shall interest payable
hereon exceed the Highest Lawful Rate.
This Note is one of the Revolving Credit Notes referred to in the
Agreement and is entitled to the benefits of, and is subject to
the terms set forth in, the Agreement. The principal of this Note
is payable in the amounts and under the circumstances, and its ma-
turity is subject to acceleration upon the terms, set forth in the
Agreement. Except as otherwise provided in the Agreement, if any
payment on this Note becomes due and payable on a day which is not
a Business Day, the maturity thereof shall be extended to the next
Business Day and interest shall be payable at the applicable rate
or rates specified in the Agreement during such extension period.
The (i) date and amount of each Revolving Credit Loan made by the
Lender, (ii) its character as an ABR Advance or a Eurodollar
Advance, (iii) the Eurodollar Rate and Eurodollar Interest Period
applicable to any Eurodollar Advances, and (iv) each payment and
prepayment of the principal thereof, shall be recorded by the
Lender on its books and, prior to any transfer of this Note, may
be indorsed by the Lender on the schedule attached hereto or any
continuation thereof, provided that the failure of the Lender to
make any such recordation or indorsement shall not affect the
obligations of the Borrower to make payment when due of any amount
owing hereunder.
Presentment for payment, demand, protest, notice of protest and
notice of dishonor and all other demands and notices in connection
with the delivery, performance and enforcement of this Note are
hereby waived, except as specifically otherwise provided in the
Agreement.
This Note is being delivered in, is intended to be performed in,
and shall be construed and interpreted in accordance with and be
governed by the internal laws of, the State of New York, without
regard to principles of conflicts of law.
This Note may only be amended by an instrument in writing executed
pursuant to the provisions of Section 11.1 of the Agreement.
ATLANTIC ENERGY, INC.
By:
Name:
Title:
SCHEDULE TO
REVOLVING CREDIT NOTE
Interest
Rate on
Eurodollar
Advances
Type of Amount of (without
Advance(ABR principal regard to
or Eurodollar Amount of paid or Applicable
Date Rate) Advance prepaid Margin
SCHEDULE TO
REVOLVING CREDIT NOTE - continued
Interest
Period (if
Eurodollar Notation
Advance) Made By
ATLANTIC ENERGY EXHIBIT B-2
FORM OF COMPETITIVE BID NOTE
(Facility B)
______ __, 1995
New York, New York
FOR VALUE RECEIVED, ATLANTIC ENERGY, INC., a New Jersey corpora-
tion (the "Borrower"), hereby promises to pay to the order of
____________________ (the "Lender"), at the office of THE BANK
OF NEW YORK, as Agent (the "Agent"), located at One Wall Street,
New York, New York or at such other place as the Agent may
specify from time to time, in lawful money of the United States
of America, the outstanding principal balance of the Lender's
Competitive Bid Loans, together with interest thereon payable at
the rate or rates and at the time or times provided for in the
Revolving Credit Agreement (Facility B), dated as of
September 28, 1995, among the Borrower, the Lenders party
thereto and the Agent (as the same may be amended, modified or
supplemented from time to time, the "Agreement"). Capitalized
terms used herein that are defined in the Agreement shall have
the meanings therein defined. In no event shall interest
payable hereon exceed the Highest Lawful Rate.
This Note is one of the Competitive Bid Notes referred to in the
Agreement and is entitled to the benefits of, and is subject to
the terms set forth in, the Agreement. The principal of this
Note is payable in the amounts and under the circumstances, and
its maturity is subject to acceleration upon the terms, set
forth in the Agreement. Except as otherwise provided in the
Agreement, if any payment on this Note becomes due and payable
on a day which is not a Business Day, the maturity thereof shall
be extended to the next Business Day and interest shall be pay-
able at the applicable rate or rates specified in the Agreement
during such extension period.
The (i) date and amount of each Competitive Bid Loan made by the
Lender, (ii) the interest rate and Interest Period applicable
thereto and (iii) each payment and prepayment of the principal
thereof, shall be recorded by the Lender on its books and, prior
to any transfer of this Note, may be indorsed by the Lender on
the schedule attached hereto or any continuation thereof,
provided that the failure of the Lender to make any such
recordation or indorsement shall not affect the obligations of
the Borrower to make payment when due of any amount owing
hereunder.
Presentment for payment, demand, protest, notice of protest and
notice of dishonor and all other demands and notices in
connection with the delivery, performance and enforcement of
this Note are hereby waived, except as specifically otherwise
provided in the Agreement.
This Note is being delivered in, is intended to be performed in,
and shall be construed and interpreted in accordance with and be
governed by the internal laws of, the State of New York, without
regard to principles of conflicts of law.
This Note may only be amended by an instrument in writing
executed pursuant to the provisions of Section 11.1 of the
Agreement.
ATLANTIC ENERGY, INC.
By:
Name:
Title:
SCHEDULE TO
COMPETITIVE BID NOTE
Amount of
Amount of Principal
Competitive Interest Bid Payment or Notation
Date Loan Period Rate Prepayment Made by
ATLANTIC ENERGY EXHIBIT C
FORM OF BORROWING REQUEST
(Facility B)
_______ __, 99_
The Bank of New York, as Agent
Agency Function Administration
One Wall Street
18th Floor
New York, New York 10286
Attention: Patricia Clancy
The Bank of New York, as Agent
Energy Industries Division
One Wall Street
19th Floor
New York, New York 10286
Attention: Mary Lou Bradley,
Vice President
Re: Revolving Credit Agreement (Facility B),
dated as of September 28, 1995, by and among
ATLANTIC ENERGY, INC. (the "Borrower"), the
Lenders party thereto, and THE BANK OF NEW
YORK, as Agent (the "Agreement")
Capitalized terms used herein that are defined in the
Agreement shall have the meanings therein defined.
(a) Pursuant to Section 2.3 of the Agreement, the Bor-
rower hereby gives notice of its intention to borrow Revolving
Credit Loans in an aggregate principal amount of $_______ on
______ __, 19__, which borrowing(s) shall consist of the
following Advances:
Initial Interest
Type of Advance Period for Eurodollar
(Eurodollar or ABR) Amount Advances
(a)
(b)
(b) The Borrower hereby certifies that on the date hereof
and, after giving effect to the Loans requested hereby on the
Borrowing Date set forth above:
(a) The Borrower is and shall be in compliance with
all of the terms, covenants and conditions of the Agreement
relating to such Loan.
(b) There exists and there shall exist no Event of
Default under the Agreement.
(c) Each of the representations and warranties con-
tained in the Agreement shall be true and correct with the same
effect as though such representations and warranties had been
made on such Borrowing Date, except to the extent such
representations and warranties specifically relate to an
earlier date, in which case such representations and warranties
are true and correct in all material respects on and as of such
earlier date.
(d) After giving effect to the Revolving Credit
Loans requested to be made hereby, the Aggregate Credit
Exposure will not exceed the Aggregate Commitments.
IN WITNESS WHEREOF, the Borrower has caused this request
and certificate to be executed by its Authorized Signatory as
of the date and year first written above.
ATLANTIC ENERGY, INC.
By:
Name:
Title:
ATLANTIC ENERGY EXHIBIT D
FORM OF COMPETITIVE BID REQUEST
(Facility B)
[Date]
The Bank of New York, as Agent
Agency Function Administration
One Wall Street
18th Floor
New York, New York 10286
Attention: Patricia Clancy
The Bank of New York, as Agent
Energy Industries Division
One Wall Street
19th Floor
New York, New York 10286
Attention: Mary Lou Bradley
Vice President
Re: Revolving Credit Agreement (Facility B),
dated as of September 28, 1995, by and
among ATLANTIC ENERGY, INC. (the "Bor-
rower"), the Lenders party thereto, and THE
BANK OF NEW YORK, as Agent (the "Agree-
ment")
Capitalized terms used herein which defined in the
Agreement shall have the meanings therein defined.
Pursuant to Section 2.4 of the Agreement, the Bor-
rower hereby gives notice of its request to borrow
Competitive Bid Loans in the aggregate sum of $____________
on ____________, which borrowing shall consist of the
following Competitive Interest Periods and amounts
corresponding thereto:
Competitive
Interest Period Amount
(1)
(2)
(3)
The Borrower hereby certifies that on the date hereof
and, after giving effect to the Competitive Bid Loans
requested hereby, on the Borrowing Date set forth above:
The Borrower is and shall be in compliance with all of the
terms, covenants and conditions of the Agreement relating to
such Loans.
There exists and there shall exist no Event of Default
under the Agreement.
(c) Each of the representations and warranties contained
in the Agreement shall be true and correct with the same effect
as though such representations and warranties had been made on
such Borrowing Date, except to the extent such representations
and warranties specifically relate to an earlier date, in which
case such representations and warranties are true and correct
in all material respects on and as of such earlier date.
(d) After giving effect to the Competitive Bid Loans
requested to be made hereby, the Aggregate Credit Exposure will
not exceed the Aggregate Commitments.
IN WITNESS WHEREOF, the Borrower has caused this request
and certificate to be executed by its Authorized Signatory as
of the date and year first written above.
ATLANTIC ENERGY, INC.
By:
Name:
Title:
ATLANTIC ENERGY EXHIBIT E
FORM OF INVITATION TO BID
(Facility B)
_____ __, 199_
To the Lenders under the Credit
Agreement referred to below
Re: Revolving Credit Agreement (Facility B),
dated as of September 28, 1995, by and
among ATLANTIC ENERGY, INC. (the "Bor-
rower"), the Lenders party thereto, and THE
BANK OF NEW YORK, as Agent (the "Agree-
ment")
Capitalized terms used herein which
are defined in the Agreement shall have the
meanings therein defined.
Pursuant to a Competitive Bid Request,
a copy of which is appended hereto or enclosed
herewith, the Borrower has given notice of its
request to borrow Competitive Bid Loans in the
aggregate sum of $____________ on ____________
The Lenders are hereby invited to bid
to make such Competitive Bid Loans by 10:00 a.m.
on the proposed Borrowing Date, pursuant to the
terms and conditions of the Agreement.
Very truly yours,
THE BANK OF NEW YORK,
as Agent
By:
Name:
Title:
ATLANTIC ENERGY EXHIBIT F
FORM OF COMPETITIVE BID
(Facility B)
_____ __, 199_
The Bank of New York, as Agent
Agency Function Administration
One Wall Street
18th Floor
New York, New York 10286
Attention: Patricia Clancy
The Bank of New York, as Agent
Energy Industries Division
One Wall Street
19th Floor
New York, New York 10286
Attention: Mary Lou Bradley,
Vice President
Re: Revolving Credit Agreement (Facility B),
dated as of September 28, 1995, by and
among ATLANTIC ENERGY, INC. (the "Bor-
rower"), the Lenders party thereto, and THE
BANK OF NEW YORK, as Agent (the "Agree-
ment")
Capitalized terms used herein that are
defined in the Agreement shall have the meanings
therein defined.
In response to a Competitive Bid Request,
the undersigned Lender hereby offers to lend
Competitive Bid Loans in the aggregate sum of
$____________ on ____________, which borrowing
shall consist of the following Competitive
Interest Periods and the amounts and Bid Rates
corresponding thereto:
Competitive
Interest Period Amount Bid Rate
(1)
(2)
(3)
Very truly yours,
[LENDER]
By:
Name:
Title:
ATLANTIC ENERGY EXHIBIT G
FORM OF COMPETITIVE BID ACCEPT/REJECT LETTER
(Facility B)
_______ __, 199_
The Bank of New York, as Agent
Agency Function Administration
One Wall Street
18th Floor
New York, New York 10286
Attention: Patricia Clancy
The Bank of New York, as Agent
Energy Industries Division
One Wall Street
19th Floor
New York, New York 10286
Attention: Mary Lou Bradley,
Vice President
Re: Revolving Credit Agreement (Facility B),
dated as of September 28, 1995, by and
among ATLANTIC ENERGY, INC. (the "Bor-
rower"), the Lenders party thereto, and THE
BANK OF NEW YORK, as Agent (the "Agree-
ment")
Capitalized terms used herein that are
defined in the Agreement shall have the meanings
therein defined.
Pursuant to Section 2.4(c) of the
Agreement, the Borrower hereby gives notice of
its [rejection/acceptance] of [Lender's]
Competitive Bid, dated _____ __, 199_, in the
aggregate sum of $_________ on ________, which
borrowing shall consist of the following
Competitive Interest Periods and the amounts and
Bid Rates corresponding thereto:
Competitive
Interest Period Amount Bid Rate
(1)
(2)
(3)
Very truly yours,
ATLANTIC ENERGY, INC.
By:
Name:
Title:
ATLANTIC ENERGY EXHIBIT H
FORM OF COMPETITIVE BID LOAN CONFIRMATION
(Facility B)
_____ __, 199_
To [Lender]
Re: Revolving Credit Agreement (Facility B),
dated as of September 28, 1995, by and
among ATLANTIC ENERGY, INC. (the "Bor-
rower"), the Lenders party thereto, and THE
BANK OF NEW YORK, as Agent (the "Agree-
ment")
Capitalized terms used herein that are
defined in the Agreement shall have the meanings
therein defined.
In accordance with Section 2.4(c) of the
Agreement we hereby notify you that pursuant to
a Competitive Bid Accept Letter, the Borrower
gave notice of its acceptance of [Lender's]
Competitive Bid, dated _____________, in the
aggregate sum of $____________ on ____________,
which borrowing shall consist of the following
Competitive Interest Periods and the following
amounts and Bid Rates corresponding thereto:
Competitive
Interest Period Amount Bid Rate
(1)
(2)
(3)
Pursuant to Section 2.4(e) of the
Agreement, [Lender] is required to make avail-
able to the Agent at its office the proceeds of
Lender's Competitive Bid Loan(s) set forth in
Section 11.2 of the Agreement, in immediately
available funds, not later than 2:00 p.m. on the
Borrowing Date specified above.
Very truly yours,
THE BANK OF NEW YORK, as Agent
By:
Name:
Title:
ATLANTIC ENERGY EXHIBIT I
FORM OF NOTICE OF CONVERSION/CONTINUATION
(Facility B)
_______ __, 199_
The Bank of New York, as Agent
Agency Function Administration
One Wall Street
18th Floor
New York, New York 10286
Attention: Patricia Clancy
The Bank of New York, as Agent
Energy Industries Division
One Wall Street
19th Floor
New York, New York 10286
Attention:Mary Lou Bradley,
Vice President
Re: Revolving Credit Agreement (Facility B),
dated as of September 28, 1995, by and
among ATLANTIC ENERGY, INC. (the "Bor-
rower"), the Lenders party thereto, and THE
BANK OF NEW YORK, as Agent (the "Agree-
ment")
Capitalized terms used herein that are
defined in the Agreement shall have the meanings
therein defined.
Pursuant to Section 2.7 of the Agreement,
the Borrower requests to convert or continue
Advances as set forth below:
on ____ __, 199_, to convert $_______ in
principal amount of presently outstanding
Eurodollar Advances having an Interest Period
that expires on ____ __, 199_ to ABR Advances.
on ____ __, 199_, to continue as
Eurodollar Advances, $_______ in principal
amount of presently outstanding Eurodollar
Advances having an Interest Period that expires
on ____ __, 199_ for an additional Interest
Period of __ months;
on ____ __, 199_, to convert $_______ in
principal amount of presently outstanding ABR
Advances to Eurodollar Advances that have an
initial Interest Period of __ months.
(c) The Borrower hereby certifies that on
the date hereof and on the requested
Conversion/Continuation Date set forth above,
there exists and there shall exist no Default or
Event of Default under the Agreement.
IN WITNESS WHEREOF, the Borrower has caused
this request and certificate to be executed by
its Authorized Signatory as of the date and year
first written above.
ATLANTIC ENERGY, INC.
By:
Name:
Title:
ATLANTIC ENERGY EXHIBIT J
FORM OF LETTER OF CREDIT REQUEST
(Facility B)
_______ __,
199_
The Bank of New York, as Agent
Agency Function Administration
One Wall Street
18th Floor
New York, New York 10286
Attention: Patricia Clancy
The Bank of New York, as Agent
Energy Industries Division
One Wall Street
19th Floor
New York, New York 10286
Attention:Mary Lou Bradley,
Vice President
Re: Revolving Credit Agreement (Facility B),
dated as of September 28, 1995, by and
among ATLANTIC ENERGY, INC. (the "Bor-
rower"), the Lenders party thereto, and THE
BANK OF NEW YORK, as Agent (the "Agree-
ment")
Capitalized terms used herein that are
defined in the Agreement shall have the meanings
therein defined.
(d) Pursuant to Sections 2.18 of the
Agreement, the Borrower hereby requests that the
Issuing Bank issue the Letter(s) of Credit in
accordance with the information annexed hereto
(attach additional sheets if necessary).
(e) The Borrower hereby certifies that on
the date hereof and on the Borrowing Date set
forth above, and after giving effect to the
Letter(s) of Credit requested hereby:
(a)The Borrower is and shall be in
compliance with all of the terms, covenants and
conditions of the Agreement relating to such
Letter of Credit.
(b)There exists and there shall exist no
Event of Default under the Agreement.
(c) Each of the representations and
warranties contained in the Agreement shall be
true and correct with the same effect as though
such representations and warranties had been
made on such Borrowing Date, except to the
extent such representations and warranties
specifically relate to an earlier date, in which
case such representations and warranties are
true and correct in all material respects on and
as of such earlier date.
(d) After giving effect to the Letters of
Credit requested to be made hereby, the
Aggregate Credit Exposure does not exceed the
Aggregate Commitments.
IN WITNESS WHEREOF, the Borrower has caused
this request and certificate to be executed by
its Authorized Signatory as of the date and year
first written above.
ATLANTIC ENERGY, INC.
By:
Name:
Title:
LETTER OF CREDIT INFORMATION
1. Name of
Beneficiary:__________________________________.
2. Address of Beneficiary to which Letter of
Credit will be sent:
_________________________________________
________________________________________________
______________.
3. Conditions under which a drawing may be made
(specify any required documentation):
_____________________________________
________________________________________________
______________
________________________________________________
______________.
4. Maximum amount to be available under such
Letter of Credit: $___________.
5. Requested date of issuance: _____ __, 199_.
6.Requested date of expiration: _____ __, 199_.
ATLANTIC ENERGY EXHIBIT K
FORM OF COMPLIANCE CERTIFICATE
(Facility B)
I, ______________, do hereby certify that I
am the ___________ of ATLANTIC ENERGY, INC., a
New Jersey corporation (the "Borrower"), and
that, as such, I am duly authorized to execute
and deliver this Compliance Certificate on the
Borrower's behalf pursuant to Section 7.1(c) of
each of (i) the Revolving Credit Agreement
(Facility A), dated as of September 28, 1995,
among the Borrower, the Lenders party thereto
and The Bank of New York, as Agent (as the same
may be amended, supplemented or otherwise modi-
fied from time to time, the "Facility A
Agreement") and (ii) the Revolving Credit
Agreement (Facility B), dated as of
September 28, 1995, among the Borrower, the
Lenders party thereto and The Bank of New York,
as Agent (as the same may be amended,
supplemented or otherwise modified from time to
time, the "Facility B Agreement" and, together
with the Facility A Agreement, the
"Agreements"). Capitalized terms used herein
that are defined in the Agreements shall have
the meanings therein defined.
I hereby certify that:
1. The Indebtedness Capitalization Ratio as of
______ __, 199_ , is _.__:1.00, calculated as
set forth on Schedule 1.
2. The Ratio of Indebtedness of the Borrower
to Annualized ACE Dividends as of ______ __,
199_, is _.__:1.00, calculated as set forth on
Schedule 2.
3. There exists no Event of Default under the
Agreement.
IN WITNESS WHEREOF, I have executed this
Compliance Certificate on this ___ day of
______________, 19__.
Schedule 1 to Compliance Certificate
dated __/__/__
COMPUTATION OF INDEBTEDNESS CAPITALIZATION RATIO
1. Total Indebtedness of the Borrower
and its Subsidiaries determined
on a Consolidated basis
in accordance with GAAP $_________
2. Preferred Stock and any premium
thereon of the Borrower and its
Subsidiaries determined on a
Consolidated basis in accordance
with GAAP $_________
3. Common Stock and any premium
thereon of the Borrower and its
Subsidiaries determined on a
Consolidated basis in accordance
with GAAP $_________
4. Retained earnings of the Borrower
and its Subsidiaries determined on a
Consolidated basis in accordance
with GAAP $_________
5. All Indebtedness (net of unamortized
premium and discount) of the Borrower
and its Subsidiaries determined on a
Consolidated basis in accordance
with GAAP $_________
6. Sum of Items 2 through 5 $_________
7. Unamortized capital Stock expense
of the Borrower and its Subsidiaries
determined on a Consolidated basis
in accordance with GAAP $_________
8. Items 6 minus Item 7 $_________
9. Indebtedness Capitalization Ratio
Item 1:Item 8 _.__:1.00
10. Maximum permitted ratio
pursuant to Section 7.10 of
each of the Agreements 0.65:1.00
Schedule 2 to Compliance Certificate
dated __/__/__
CALCULATION OF RATIO OF TOTAL INDEBTEDNESS OF THE BORROWER
TO ANNUALIZED ACE DIVIDENDS
1. Indebtedness of the Borrower $_________
2. The amount of dividends paid
to the Borrower by ACE during
the fiscal quarter ending on
the date of determination or,
if such date of determination
is not a fiscal quarter ending
date, the immediately preceding
fiscal quarter $_________
3. Annualized ACE Dividends
(Item 2 multiplied by 4) $_________
4. Ratio of Indebtedness to
Annualized ACE Dividends
(Item 1:Item 3) _.__:1.00
Maximum permitted ratio
pursuant to Section 7.11 of
each of the Agreements 2.50:1.00.
ATLANTIC ENERGY EXHIBIT L
FORM OF PLEDGE AGREEMENT
(Facility B)
PLEDGE AGREEMENT (as amended, modified or
supplemented from time to time, this
"Agreement"), dated as of ______ __, 1995, made
by ATLANTIC ENERGY, INC., a New Jersey
corporation (the "Borrower"), to THE BANK OF NEW
YORK, in its capacity as collateral agent (in
such capacity, the "Secured Party") for itself
in its capacity as Agent and for the Lenders
under and as defined in each of the Facility A
Credit Agreement as defined below (in such
capacity, the "Facility A Agent") and the
Facility B Credit Agreement as defined below (in
such capacity, the "Facility B Agent" and,
together with the Facility A Agent, the
"Agents").
RECITALS
1. The Borrower has entered into (i) the
Revolving Credit Agreement (Facility A), dated
as of the date hereof, among the Borrower, the
Lenders party thereto (each, a "Facility A
Lender", and collectively, the "Facility A
Lenders") and the Facility A Agent (as the same
may be amended, supplemented or otherwise
modified from time to time, the "Facility A
Credit Agreement") and (ii) the Revolving Credit
Agreement (Facility B), dated as of the date
hereof among the Borrower, the Lenders party
thereto (each, a "Facility B Lender",
collectively, the "Facility B Lenders" and
together with the Facility A Lenders, the
"Lenders") and the Facility B Agent (as the same
may be amended, supplemented or otherwise
modified from time to time, the "Facility B
Credit Agreement" and, together with the
Facility B Credit Agreement, the "Credit
Agreements"). Capitalized terms used herein
that are not defined herein and are defined in
the Credit Agreements shall have the meanings
defined therein.
2. The Lenders have agreed (i) to make
loans to the Borrower pursuant to, and upon the
terms and subject to the conditions specified
in, the Facility A Credit Agreement and (ii) to
make loans to the Borrower and to participate in
Letters of Credit issued by Issuing Bank (as
defined in the Facility B Credit Agreement)
pursuant to, and upon the terms and subject to
the conditions specified in, the Facility B
Credit Agreement. The Borrower desires to
secure the prompt and complete payment,
observance and performance of all of its
obligations of every kind and nature now or
hereafter incurred, existing or created under or
in respect of the Loan Documents (as defined in
the Facility A Credit Agreement which Loan
Documents are herein referred to as the
"Facility A Loan Documents") and the Loan
Documents (as defined in the Facility B Credit
Agreement which Loan Documents are herein
referred to as the "Facility B Loan Documents"
and, together with the "Facility A Loan
Documents", the "Loan Documents"), as such
obligations may be amended, increased, modified,
renewed, refinanced, refunded or extended from
time to time, (collectively, the "Obligations").
3. The obligations of the Lenders to make
loans under the Credit Agreements and the
Issuing Bank to issue Letters of Credit under
the Facility B Credit Agreement and the Facility
B Lenders to participate therein are conditioned
upon, among other things, the execution and
delivery by the Borrower of this Agreement.
In consideration of the premises and in
order to induce the Secured Party and the
Lenders to enter into the Credit Agreements and
make the loans under the Credit Agreements and
the Issuing Bank to issue the Letters of Credit
under the Facility B Credit Agreement and the
Facility B Lenders to participate therein, the
Borrower hereby agrees with the Secured Party
for its benefit and for the ratable benefit of
the Lenders as follows:
3.1. Grant of Security
To secure the prompt and complete
payment, observance and performance of all of
the Obligations, the Borrower hereby assigns and
pledges to the Secured Party, for its benefit,
for the benefit of the Agents, for the benefit
of the Issuing Bank and for the ratable benefit
of the Lenders, and hereby grants to the Secured
Party, for its benefit, for the benefit of the
Agents, for the benefit of the Issuing Bank and
for the ratable benefit of the Lenders, a
continuing first priority security interest in
all of the Borrower's right, title and interest
in and to all promissory notes and other debt
instruments evidencing Indebtedness owed by any
of the Borrower's Operating Subsidiaries to the
Borrower (each, an "Intercompany Note"), in each
case whether now owned or hereafter acquired,
including, without limitation, the Intercompany
Notes owned on the date hereof as set forth on
Schedule 1, and all interest and other payments
thereunder and instruments and other Property
from time to time delivered in respect thereof
or in exchange therefor, and all additions
thereto, substitutions and replacements
therefor, and the products and Proceeds thereof
(the "Collateral").
As used herein, the term "Proceeds"
shall have the meaning as set forth in Article 9
of the New York Uniform Commercial Code (as the
same is amended from time to time, the "UCC")
and, to the extent not otherwise included, shall
include, but not be limited to, (i)
distributions payable in Property; (ii) any and
all proceeds of causes and rights of action or
settlements thereof, escrowed amounts or
Property, judicial and arbitration judgments and
awards, payable to the Borrower from or in
respect of any Person from time to time; (iii)
all claims of the Borrower for losses or damages
arising out of or relating to or for any breach
of any agreements, covenants, representations or
warranties or any default whether or not with
respect to or under any of the foregoing
Collateral (without limiting any direct or
independent rights of the Secured Party or any
Lender with respect to the Collateral); and (iv)
any and all other amounts from time to time paid
or payable under or in connection with the
Collateral.
3.2. Delivery of Collateral
All notes and other instruments
representing or evidencing the Collateral at any
time owned or acquired by the Borrower shall be
delivered to and held by or on behalf of the
Secured Party pursuant hereto and shall be in
suitable form for transfer by delivery, and
shall bear appropriate indorsements or shall be
accompanied by duly executed instruments of
transfer or assignments in blank, all in form
and substance satisfactory to the Secured Party.
Upon the occurrence and during the continuance
of an Event of Default, the Secured Party shall
have the right, at any time in its discretion
and without notice to the Borrower, to transfer
to or to register in the name of the Secured
Party or any of its nominees any or all of the
Collateral. In addition, upon the occurrence
and during the continuance of an Event of
Default, the Secured Party shall have the right
at any time to exchange certificates or
instruments representing or evidencing
Collateral for certificates or instruments of
smaller or larger denominations.
3.3. Representations and Warranties
The Borrower represents and warrants as follows:
(a) The Borrower is the legal and beneficial
owner of the Collateral, free and clear of all
Liens other than the Lien created by this
Agreement.
(b) This Agreement creates a valid security
interest in the Collateral, securing the payment
of the Obligations. The delivery and pledge of
the Collateral pursuant to this Agreement create
a valid and perfected first priority security
interest in the Collateral securing the payment
of the Obligations.
(c) The Intercompany Notes listed on Schedule
1 constitute all of the Intercompany Notes held
by the Borrower on the date of this Agreement.
To the best of the Borrower's knowledge, each of
such Intercompany Notes has been duly
authorized, issued and delivered, and
constitutes the legal, valid, binding and
enforceable obligations of the respective makers
thereof.
3.4. Further Assurances
(a) The Borrower agrees that from time to time,
at its expense, the Borrower shall promptly
execute and deliver all further instruments and
documents, and take all further action, that the
Secured Party may reasonably request, in order
to perfect and protect any security interests
granted hereby or to enable the Secured Party to
exercise and enforce its rights and remedies
hereunder with respect to any Collateral.
Without limiting the generality of the
foregoing, the Borrower shall promptly execute
and file such financing or continuation
statements, or amendments thereto, and such
other instruments or notices, and promptly take
such other action as the Secured Party may
reasonably request, in order to perfect and
preserve the security interests granted hereby.
(b) The Borrower hereby authorizes the Secured
Party to file one or more financing or
continuation statements, and amendments thereto,
relative to all or any part of the Collateral
without the signature of the Borrower where
permitted by law. The Secured Party shall
provide the Borrower with a copy of any such
statement or amendment, provided that no failure
to do so shall affect the rights of the Secured
Party hereunder, result in any liability of the
Secured Party or the Lenders to the Borrower or
in any way affect the validity of such filing.
A photographic or other reproduction of this
Agreement or any financing statement covering
the Collateral or any part thereof shall be
sufficient as a financing statement where
permitted by law.
(c) The Borrower shall furnish to the Secured
Party from time to time statements and schedules
further identifying and describing the
Collateral and such other reports in connection
with the Collateral as the Secured Party may
reasonably request, all in reasonable detail.
3.5. Certain Rights as to the Collateral
(a) So long as no Event of Default shall have
occurred and be continuing:
The Borrower shall be entitled to exercise any
and all consensual rights pertaining to the
Collateral or any part thereof for any purpose
not inconsistent with the terms of this
Agreement and the Credit Agreements, provided,
however, that the Borrower shall not exercise or
refrain from exercising any such right without
the consent of the Secured Party if such action
or inaction would have a material adverse effect
on the fair market value of any part of the
Collateral or the validity, priority or
perfection of the security interests granted
hereby or the remedies of the Secured Party
hereunder.
(i) The Borrower shall be entitled to receive
and retain any and all principal, interest and
other distributions paid in respect of the
Collateral to the extent not prohibited by this
Agreement, provided, however, that any and all
principal, interest and other distributions paid
or payable other than in cash in respect of, and
instruments and other Property received,
receivable or otherwise distributed in respect
of, or in exchange for, Collateral, shall
forthwith be delivered to the Secured Party to
be held as Collateral and shall, if received by
the Borrower, be received in trust for the
benefit of the Secured Party, be segregated from
the other Property of the Borrower, and be
forthwith delivered to the Secured Party, as
Collateral in the same form as so received (with
any necessary indorsement).
(ii) The Secured Party shall execute and deliver
(or cause to be executed and delivered) to the
Borrower all instruments as the Borrower may
reasonably request for the purpose of enabling
the Borrower to exercise the rights which it is
entitled to exercise pursuant to clause (i)
above and to receive the principal or interest
payments, or other distributions which it is
authorized to receive and retain pursuant to
clause (ii) above.
(b) Upon the occurrence and during the
continuance of an Event of Default and at the
Secured Party's option and following written
notice by the Secured Party to the relevant
Borrower:
(i) All rights of the Borrower to exercise the
consensual rights which it would otherwise be
entitled to exercise pursuant to Section 5(a)(i)
and to receive the principal, and interest
payments and other distributions which it would
otherwise be authorized to receive and retain
pursuant to Section 5(a)(ii) shall cease, and
all such rights shall thereupon become vested in
the Secured Party, who shall thereupon have the
sole right to exercise such consensual rights
and to receive and hold as Collateral such
principal or interest payments and
distributions.
(ii) All principal and interest payments and
other distributions which are received by the
Borrower contrary to the provisions of Section
5(b)(i) shall be received in trust for the
benefit of the Secured Party, shall be
segregated from other funds of the Borrower and
shall be forthwith paid over to the Secured
Party as Collateral in the same form as so
received (with any necessary indorsement).
(c) In the event that all or any part of the
instruments constituting the Collateral are
lost, destroyed or wrongfully taken while such
instruments are in the possession of the Secured
Party, the Borrower agrees that it will cause
the delivery of new instruments in place of the
lost, destroyed or wrongfully taken securities
or instruments upon request therefor by the
Secured Party without the necessity of any
indemnity bond or other security other than the
Secured Party's agreement or indemnity therefor
customary for security agreements similar to
this Agreement.
3.6. Other Covenants and Agreements of the
Borrower
The Borrower covenants and agrees that on
and after the date hereof until the indefeasible
cash payment in full of the Obligations, unless
the Secured Party shall otherwise consent in
writing:
(a) Defense of Collateral. It will defend the
Collateral against all claims and demands of all
Persons at any time claiming the same or any
interest therein adverse to the interests of the
Secured Party.
(b) Security Interest. The security interest
granted hereby constitutes and will at all times
constitute a continuing (and so long as the
Secured Party has possession of the Collateral)
perfected first priority security interests in
the Collateral.
(c) Encumbrances; Filings. It will not (i)
further hypothecate, pledge, encumber, transfer,
sell or otherwise suffer to exist a security
interest in, or a Lien on, the Collateral or any
portion thereof in favor of any Person other
than the Secured Party as provided herein,
except for transfers or sales to the extent
permitted under the Credit Agreements or (ii)
sign or file or authorize the signing or filing
of any document or instrument perfecting any
Lien on the Collateral. The inclusion of
"Proceeds" of the Collateral under the security
interest granted herein shall not be deemed a
consent by the Secured Party to any sale or
other disposition of any Collateral.
3.7. Secured Party Appointed Attorney-in-Fact
Effective upon the occurrence and during
the continuance of an Event of Default, the
Borrower hereby irrevocably appoints the Secured
Party the Borrower's attorney-in-fact, with full
authority in the place and stead of the Borrower
and in the name of the Borrower or otherwise,
from time to time in the Secured Party's
discretion, to take any action and to execute
any instrument which the Secured Party may deem
necessary or advisable to accomplish the
purposes of this Agreement, including, without
limitation:
(a) to ask, demand, collect, sue for, recover,
compromise, receive and give acquittance and
receipts for moneys due and to become due under
or in respect of any of the Collateral,
(b) to file any claims or take any action or
institute any proceedings which the Secured
Party may deem necessary or desirable for the
collection of any of the Collateral or otherwise
to enforce the rights of the Secured Party with
respect to any of the Collateral, and
(c) to receive, indorse and collect all
instruments made payable to the Borrower
representing any principal payment, interest
payment or other distribution in respect of the
Collateral or any part thereof and to give full
discharge for the same. The powers granted to
the Secured Party under this Section constitute
a power coupled with an interest which shall
survive until all of the Obligations have been
indefeasibly paid in full in cash.
3.8. The Secured Party May Perform
If the Borrower fails to perform any
agreement contained herein, the Secured Party
may itself perform, or cause performance of,
such agreement, and the reasonable expenses of
the Secured Party incurred in connection
therewith shall be payable by the Borrower under
Section 12.
3.9. The Secured Party's Duties
The powers conferred on the Secured Party
hereunder are solely to protect its interest in
the Collateral and shall not impose any duty
upon it to exercise any such powers. Except for
the safe custody of any Collateral in its
possession and the accounting for moneys
actually received by it hereunder, the Secured
Party shall have no duty as to any Collateral.
The Secured Party shall be deemed to have
exercised reasonable care in the custody and
preservation of the Collateral in its possession
if the Collateral is accorded treatment
substantially equal to that which the Secured
Party accords its own property, it being
understood that the Secured Party shall not be
under any obligation to (i) ascertain or take
action with respect to exchanges, maturities,
tenders or other matters relative to any
Collateral, whether the Secured Party or any
Lender has or is deemed to have knowledge of
such matters, or (ii) take any necessary steps
to preserve rights against prior parties or any
other rights pertaining to any Collateral, but
may do so at its option, and all reasonable
expenses incurred in connection therewith shall
be for the sole account of the Borrower and
shall be added to the Obligations.
3.10.Events of Default
The following shall each constitute an "Event of
Default" hereunder:
(a) If any representation or warranty made
herein or in any certificate furnished by the
Borrower in connection with this Agreement shall
prove to have been incorrect or misleading
(whether because of misstatement or omission) in
any material respect when made; or
(b) If the Borrower shall fail to observe or
perform any term, covenant or agreement
contained in Section 6(c) of this Agreement; or
(c) If the Borrower shall fail to perform or
observe any other covenant or agreement on its
part to be performed or observed pursuant to
this Agreement and such failure shall have
continued unremedied for a period of thirty days
after the Borrower shall become aware of such
failure; or
(d) The occurrence of an Event of Default under
and as defined in either of the Credit
Agreements; or
(e) If the Borrower shall contest or disavow
its obligations under this Agreement or this
Agreement shall not remain in full force and
effect.
3.11.Remedies
Upon the occurrence of an Event of Default
or at any time thereafter during the continuance
thereof, the Secured Party may, and upon
direction of the Required Lenders shall,
exercise any and all remedies and other rights
provided under this Agreement, including,
without limitation, the following:
(a) The Secured Party may exercise in respect
of the Collateral, in addition to other rights
and remedies provided for herein or otherwise
available to it, all the rights and remedies of
a secured party upon default under the UCC
(whether or not the UCC applies to the
Collateral) and also may without notice, except
as specified below, sell, assign, grant an
option or options to purchase or otherwise
dispose of the Collateral or any part thereof at
public or private sale, at any exchange,
broker's board or at any of the Secured Party's
offices or elsewhere, for cash, on credit or for
future delivery, and upon such other terms as
may be commercially reasonable. The Borrower
agrees that, to the extent notice of sale shall
be required by law, at least five Business Days'
notice to the Borrower of the time and place of
any public sale or the time after which any
private sale is to be made shall constitute
reasonable notification. The Secured Party
shall not be obligated to make any sale of
Collateral regardless of notice of sale having
been given. The Secured Party may adjourn any
public or private sale from time to time by
announcement at the time and place fixed
therefor, and such sale may, without further
notice, be made at the time and place to which
it was so adjourned.
Any cash held by the Secured Party as
Collateral and all cash proceeds received by the
Secured Party in respect of any sale of,
collection from, or other realization upon all
or any part of the Collateral may, in the
discretion of the Secured Party, be held by the
Secured Party as Collateral for, and/or then or
at any time thereafter applied (after payment of
any amounts payable to the Secured Party
pursuant to Section 12) in whole or in part by
the Secured Party, for the ratable benefit of
the Lenders, against all or any part of the
Obligations in accordance with Section 9.1 of
each Credit Agreement. Any surplus of such cash
or cash proceeds held by the Secured Party and
remaining after payment in full of all the
Obligations shall be promptly paid over to the
Borrower or to whomsoever may be lawfully
entitled to receive such surplus.
(b) The Borrower hereby expressly waives and
covenants not to assert any appraisement,
valuation, stay, extension, redemption or
similar laws, now or at any time hereafter in
force, which might delay, prevent or otherwise
impede the performance or enforcement of this
Agreement.
3.12. No Segregation of Moneys; No Interest
No moneys or any other Property received by
the Secured Party hereunder need be segregated
in any manner except to the extent required by
law, and any such moneys or other Property may
be deposited under such general conditions as
may be prescribed by law applicable to the
Secured Party, and neither the Secured Party nor
any Lender shall be liable for any interest
thereon.
3.13.Notices
All notices and other communications
provided for hereunder shall be given in the
manner and to the addresses set forth in Section
11.2 of the Facility A Credit Agreement. Any
notice given to the Secured Party as Secured
Party thereunder shall be deemed to have been
given to The Bank of New York as Agent under the
Facility B Credit Agreement.
3.14. Continuing Security Interest;
Transfer of Notes
This Agreement shall create a continuing
security interest in the Collateral and shall
(i) remain in full force and effect until the
indefeasible cash payment in full of the
Obligations and the termination of the Credit
Agreement, (ii) be binding upon the Borrower,
its successors and assigns and (iii) inure,
together with the rights and remedies of the
Secured Party hereunder, to the benefit of the
Secured Party, any successor to Secured Party as
agent and the ratable benefit of the Lenders.
Except to the extent not permitted by Section
11.7 of the Credit Agreements, any Lender may
assign or otherwise transfer the notes held by
it under the Credit Agreements to any other
Person, and such other Person shall thereupon
become vested with all the benefits in respect
thereof granted to such Lender herein or
otherwise. Nothing set forth herein or in any
other Loan Document is intended or shall be
construed to give any other Person any right,
remedy or claim under, to or in respect of this
Agreement, any other Loan Document, or any
Collateral. The Borrower's successors and
assigns shall include, without limitation, a
receiver, trustee or debtor-in-possession
thereof or therefor.
3.15. Other Provisions
(a) This Agreement is the "Pledge Agreement"
referred to in each of the Credit Agreements.
Each of the Secured Party and the Borrower
acknowledges that certain provisions of each of
the Credit Agreements, including, without
limitation, Sections 1.2 (Other Definitional
Provisions), 11.1 (Amendments and Waivers), 11.3
(No Waiver; Cumulative Remedies), 11.4 (Survival
of Representations and Warranties), 11.7
(Assignments and Participations), 11.8
(Counterparts), 11.12 (Headings Descriptive),
11.13 (Severability), 11.14 (Integration), 11.15
(Consent to Jurisdiction), 11.16 (Service of
Process), 11.17 (No Limitation on Service or
Suit) and 11.18 (WAIVER OF TRIAL BY JURY)
thereof, are made applicable to this Agreement
and all such provisions are incorporated by
reference herein as if fully set forth herein.
(b) All Schedules hereto shall be deemed
to be a part hereof.
(c) Each and every right, remedy and power
granted to the Secured Party hereunder or
allowed at law or by any other agreement shall
be cumulative and not exclusive, and may be
exercised by the Secured Party from time to
time.
(d) This Agreement shall be governed by
and construed in accordance with the laws of the
State of New York without regard to conflict of
laws rules, except to the extent that the
validity or perfection of the security interest
hereunder, or remedies hereunder, in respect of
any particular Collateral are governed by the
laws of a jurisdiction other than the State of
New York. Unless otherwise defined herein,
terms used in Articles 8 and 9 of the UCC are
used herein as therein defined.
The parties hereto have caused this Pledge
Agreement to be duly executed and delivered by
its officer thereunto duly authorized as of the
date first above written.
ATLANTIC ENERGY, INC.
By:
Name:
Title:
THE BANK OF NEW YORK,
as Collateral Agent for the
Facility A Lenders under the
Facility A Credit Agreement
and the Facility B Lenders
under the Facility B Credit
Agreement
By:
Name:
Title:
Schedule 1
to the Pledge Agreement,
Dated as of _____ __, 1995
LIST OF INTERCOMPANY NOTES
Maker Date
Atlantic Generation, Inc. ,1995
ATE Investment, Inc. ____ __, 1995
Atlantic Thermal Systems, Inc. ____ __, 1995
Atlantic Jersey Thermal Systems, Inc. _____ __, 1995
Atlantic Energy Technologies, Inc. _____ __, 1995
ATLANTIC ENERGY EXHIBIT M
FORM OF INTERCOMPANY NOTE
(Facility B)
THIS NOTE HAS NOT BEEN REGISTERED UNDER THE SECURITIES ACT OF
1933, AS AMENDED (THE "SECURITIES ACT"), OR REGISTERED OR
QUALIFIED UNDER ANY SECURITIES OR BLUE SKY LAWS. IT MAY NOT BE
SOLD, TRANSFERRED, PLEDGED OR OTHERWISE DISPOSED OF EXCEPT IN A
TRANSACTION COMPLYING WITH OR EXEMPT FROM THE REGISTRATION
REQUIREMENTS OF THE SECURITIES ACT AND IN ACCORDANCE WITH ANY
APPLICABLE SECURITIES LAWS OF ANY STATE.
____________ __, 199_
FOR VALUE RECEIVED, the undersigned, _________________, a
__________ corporation (the "Borrower"), hereby promises to pay
to the order of ATLANTIC ENERGY, INC. (the "Company"), at the
office of the Company, upon demand by the Company, the aggregate
unpaid principal amount of all loans made by the Company to the
Borrower from time to time as reflected on the attached Schedule
hereto, pursuant to an intercompany account or otherwise, in
lawful money of the United States of America in same day funds,
and to pay interest from the date set forth on the attached
Schedule on which principal is advanced hereunder on the unpaid
principal amount from time to time outstanding, in like funds, at
said office, with each repayment of principal hereunder, at a
rate per annum equal to 1/4% above the borrowing rate of the
Company for amounts advanced hereunder and provided to the
Borrower by the Company on the date of any such advance. All
interest hereunder shall be calculated on the basis of the actual
number of days that principal is outstanding over a year of 365
or 366 days, as appropriate.
The unpaid principal amount hereof may be declared due and
payable by the Company, whereupon the same shall immediately
become due and payable, upon the occurrence or at any time during
the continuance of an Event of Default under, and as defined in,
either of the Revolving Credit Agreements (Facility A or Facility
B) among the Company, the Lenders parties thereto, and The Bank
of New York, as Agent.
The Borrower hereby waives diligence, presentment, demand,
protest and notice of any kind whatsoever. The nonexercise by
the holder of any of its rights hereunder in any particular
instance shall not constitute a waiver thereof in that or any
subsequent instance.
All borrowings evidenced by this Intercompany Note and all
payments and prepayments of the principal hereof and interest
hereon and the respective dates thereof shall be endorsed by the
holder hereof on the schedule attached hereto and made a part
hereof, or on a continuation thereof which shall be attached
hereto and made a part hereof, or otherwise recorded by such
holder in its internal records; provided, however, that any
failure of the holder hereof to make such a notation or any error
in such notation shall not in any manner affect the obligation of
the Borrower to make payments of principal and interest in
accordance with the terms of this Intercompany Note.
NEITHER THE BORROWER NOR ANY OTHER PERSONS LIABLE FOR THE
INDEBTEDNESS TO THE COMPANY, NOR ANY ASSIGNEE, SURVIVOR, HEIR OR
PERSONAL REPRESENTATIVE OF THE BORROWER OR ANY SUCH OTHER PERSON
OR ENTITY SHALL SEEK A JURY TRIAL IN ANY LAWSUIT, PROCEEDING,
COUNTERCLAIM OR ANY OTHER LITIGATION PROCEDURE BASED UPON OR
ARISING OUT OF THIS INTERCOMPANY NOTE, ANY RELATED INSTRUMENT OR
AGREEMENT, ANY COLLATERAL FOR THE PAYMENT HEREOF OR THE DEALINGS
OR THE RELATIONSHIP BETWEEN THE COMPANY AND SUCH PERSONS OR
ENTITIES, OR ANY OF THEM. NEITHER THE BORROWER NOR ANY SUCH
PERSON OR ENTITY WILL SEEK TO CONSOLIDATE ANY SUCH ACTION, IN
WHICH A JURY TRIAL HAS BEEN WAIVED, WITH ANY OTHER ACTION IN
WHICH A JURY TRIAL CANNOT BE OR HAS NOT BEEN WAIVED. THE
PROVISIONS OF THIS PARAGRAPH HAVE BEEN FULLY DISCUSSED BY THE
BORROWER AND THE COMPANY AND THE PROVISIONS HEREOF SHALL BE
SUBJECT TO NO EXCEPTIONS. THE BORROWER HAS NOT IN ANY WAY AGREED
WITH OR REPRESENTED TO ANY OTHER PARTY THAT THE PROVISIONS OF
THIS PARAGRAPH WILL NOT BE FULLY ENFORCED IN ALL INSTANCES.
THIS INTERCOMPANY NOTE SHALL BE CONSTRUED IN ACCORDANCE
WITH AND GOVERNED BY THE LAWS OF THE STATE OF NEW JERSEY AND ANY
APPLICABLE LAWS OF THE UNITED STATES OF AMERICA.
[BORROWER]
By:
Name:
Title:
SCHEDULE TO INTERCOMPANY NOTE
[BORROWER]
LOANS BALANCE OUTSTANDING
INTERCOMPANY ACCOUNT
Loan Balance
Date Advance Repayment Outstanding
ENDORSEMENT
The undersigned, ATLANTIC ENERGY, INC. a New Jersey
corporation (the "Company"), hereby assigns, transfers and
endorses to and makes payable to the order of The Bank of New
York, as collateral agent for itself in its capacity as Agent and
the Lenders under and as defined in each of the (i) Revolving
Credit Agreement (Facility A), dated as of September 28, 1995,
among the Borrower, the Lenders party thereto and the Agent (as
the same may be amended, supplemented or otherwise modified from
time to time) and (ii) Revolving Credit Agreement (Facility B),
dated as of September 28, 1995, among the Borrower, the Lenders
party thereto and the Agent (as the same may be amended,
supplemented or otherwise modified from time to time), that
certain Intercompany Note, dated ___________ __, ____, made by
___________________ to the order of the Company. This endorse-
ment is made with recourse to the undersigned for payment or
collection.
DATED: __________ __, 199_
ATLANTIC ENERGY, INC.
By:
Name:
Title:
ATLANTIC ENERGY EXHIBIT N
MEMORANDUM OF OPINIONS TO BE GIVEN
BY COUNSEL TO THE BORROWER
In connection with the (i) Revolving Credit Agreement
(Facility A) (the "Facility A Agreement"), dated as of
September 28, 1995, by and among Atlantic Energy, Inc. (the
"Borrower"), the Lenders party thereto (the "Facility A Lenders")
and The Bank of New York, as Agent (the "Facility A Agent") and
(ii) Revolving Credit Agreement (Facility B) (the "Facility B
Agreement" and, together with the Facility A Agreement, the
"Agreements"), dated as of September 28, 1995, by and among the
Borrower, the Lenders party thereto (the "Facility B Lenders"),
The Bank of New York, as Issuing Bank and The Bank of New York,
as Agent (the "Facility B Agent"), set forth below is the
substance of the opinions to be included in the opinion letters
referred to in Section 5.8 of the Facility B Agreement and the
corresponding provision of the Facility A Agreement
(collectively, the "Opinions").
The opinion letters should be addressed to "The Bank
of New York, as Agent and as Issuing Bank and the Lenders under
the Credit Agreements referred to below". It should specifically
authorize Special Counsel's reliance thereon.
Capitalized terms used in the Opinions and which are
not otherwise defined therein shall have the respective meanings
ascribed thereto in the Agreements. For purposes of the
opinions set forth below, the term "Transaction Documents"
means, collectively, the "Loan Documents" under and as defined in
each of the Agreements and the term "Notes" means, collectively,
the "Notes" under and as defined in each of the Agreements.
Opinions:
(e) The Borrower has only the Subsidiaries set forth
on Schedule 4.1 to each Agreement. The shares of each Subsidiary
are duly authorized, validly issued, fully paid and nonassessable
and are owned free and clear of any Liens.
(f) Each of the Borrower and its Subsidiaries is
duly organized or formed and validly existing in good standing
under the laws of the jurisdiction of its incorporation or for-
mation, has all requisite power and authority to own its Property
and to carry on its business as now conducted, and is in good
standing and authorized to do business as a foreign corporation
in each jurisdiction in which the nature of the business con-
ducted therein or the Property owned therein makes such
qualification necessary, except where such failure to qualify,
singly or in the aggregate, could not reasonably be expected to
have a Material Adverse Effect.
(g) The Borrower has full legal power and authority
and has taken all necessary actions, including, without
limitation, any necessary stockholder action, to enter into,
execute, deliver and perform the terms of the Transaction
Documents and to make the borrowings contemplated thereby and by
the Notes, to execute, deliver and carry out the terms of the
Notes and to incur the obligations provided for therein, all of
which have been duly authorized by all proper and necessary
corporate or other applicable action and are in full compliance
with its charter and by-laws or its other organization documents.
(h) Each of the Transaction Documents (other than
the Notes) constitutes, and the Notes, when issued and delivered
pursuant to the applicable Agreement for value received, will
constitute, the valid and legally binding obligations of the
Borrower, enforceable in accordance with its respective terms.
(i) To the best of counsel's knowledge after due
inquiry, except as set forth in the Financial Statements, there
are no actions, suits or proceedings at law or in equity or by or
before any Governmental Authority (whether or not purportedly on
behalf of the Borrower or any of its Subsidiaries) pending or
threatened against the Borrower or any of its Subsidiaries or any
of their respective Properties or rights, which (i) reasonably
may be expected to have a Material Adverse Effect, or (ii) call
into question the validity or enforceability of any of the
Transaction Documents.
(j) Except for information filings required to be
made in the ordinary course of business which are not a condition
to the Borrower's performance under the Transaction Documents, no
consent, authorization or approval of, filing with, notice to, or
exemption by, stockholders, any Governmental Authority or any
other Person is required to authorize, or is required in con-
nection with the execution, delivery and performance of the
Transaction Documents or is required as a condition to the
validity or enforceability of the Transaction Documents.
(k) To the best of counsel's knowledge after due
inquiry, neither the Borrower nor any of its Subsidiaries is in
default (x) under any mortgage, indenture, contract or agreement
to which it is a party or by which it or any of its Property is
bound or (y) with respect to any judgment, order, writ, injunc-
tion, decree or decision of any Governmental Authority, the
effect of which default could reasonably be expected to have a
Material Adverse Effect.
(l) The execution, delivery or carrying out of the
terms of the Transaction Documents will not constitute a default
under, or require the mandatory repayment of, or result in the
creation or imposition of, or obligation to create, any Lien upon
any Property of the Borrower or any of its Subsidiaries pursuant
to the terms of, any such mortgage, indenture, contract or
agreement.
(m) To the best of counsel's knowledge after due
inquiry, each of the Borrower and ACE possesses or has the right
to use all franchises, licenses, privileges and other rights as
are material and necessary for the conduct of its business, and
with respect to which it is in compliance, with no known conflict
with the valid rights of others which could reasonably be ex-
pected to have a Material Adverse Effect.
(n) The Borrower is not an "investment company" or a
company "controlled" by an "investment company" as defined in, or
is otherwise subject to regulation under, the Investment Company
Act of 1940, as amended.
(o) The Borrower and each of its Subsidiaries are
exempt from the provisions of the Public Utility Holding Company
Act of 1935, as amended, except Section 9(a)(2) thereof, pursuant
to Rule 2 of the General Rules and Regulations of the SEC under
said Act.
(p) To the best of counsel's knowledge after due
inquiry, neither the Borrower nor any of its Subsidiaries is
engaged principally, or as one of its important activities, in
the business of extending credit for the purpose of purchasing or
carrying any Margin Stock. If used in accordance with Section
2.15 of each Agreement, no part of the proceeds of the Loans will
be used, directly or indirectly, for a purpose which violates any
law, rule or regulation of any Governmental Authority, including
without limitation the provisions of Regulations G, T, U or X of
the Board of Governors of the Federal Reserve System, as amended.
If used in accordance with Section 2.15 of each Agreement, no
part of the proceeds of the Loans will be used, directly or indi-
rectly, to purchase or carry Margin Stock or to extend credit to
others for the purpose of purchasing or carrying Margin Stock.
(q) The Pledge Agreement is effective to create in
favor of The Bank of New York, as collateral agent for each of
The Bank of New York, as Agent under the Facility A Agreement,
The Bank of New York, as Agent under the Facility B Agreement,
The Bank of New York, Issuing Bank under the Facility B Agreement
and each of the Lenders under the Agreements in all of the
Borrower's right, title and interest in and to all Intercompany
Notes (as defined in the Pledge Agreement) when issued and
delivered, provided that such Intercompany Notes remain in the
continued possession of such collateral agent.
(r) To the best of counsel's knowledge after due inquiry,
no indenture, certificate of designation for preferred Stock,
agreement or instrument to which the Borrower or ACE is a party,
prohibits or restrains, directly or indirectly, the payment of
dividends or other payments by ACE to the Borrower except for the
terms of the ACE Preferred Stock as in existence on the Effective
Date.
ATLANTIC ENERGY EXHIBIT O
FORM OF OPINION OF SPECIAL COUNSEL
_____ __, 1995
The Bank of New York,
as Agent and the other
Lenders under the Credit
Agreements referred to below
Ladies and Gentlemen:
We have acted as Special Counsel to (A) The Bank of New
York, as Agent (in such capacity, the "Facility A Agent") in
connection with the Revolving Credit Agreement (Facility A),
dated as of September 28, 1995, by and among Atlantic Energy,
Inc. (the "Borrower"), the Lenders party thereto and the Facility
A Agent (the "Facility A Agreement") and (B) The Bank of New
York, as Agent (in such capacity, the "Facility B Agent") in
connection with the Revolving Credit Agreement (Facility B),
dated as of September 28, 1995, by and among the Borrower, the
Lenders party thereto and the Facility B Agent (the "Facility B
Agreement" and, together with the Facility A Agreement, the
"Agreements"). Capitalized terms used herein which are defined
in the Facility A Agreement shall have the meanings therein
defined, unless the context hereof otherwise requires.
We have examined originals or copies certified to our
satisfaction of the documents required to be delivered pursuant
to the provisions of Sections 5 and 6 of each of the Agreements.
In conducting such examination, we have assumed the genuineness
of all signatures, the authenticity of all documents submitted to
us as originals, and the conformity to originals of all documents
submitted to us as copies.
Based upon the foregoing examination, and relying with
your permission upon the opinions of Ballard Spahr Andrews &
Ingersoll, special counsel to the Borrower, and James E. Franklin
II, Esq., General Counsel of the Borrower, we are of the opinion
that all legal preconditions to the making of the first Loans
under and as defined in each of the Agreements and the issuance
of the first Letter of Credit under and as defined in the
Facility B Agreement have been satisfactorily met.
This opinion is rendered solely for your benefit in
connection with the transactions referred to herein and may not
be relied upon by any other Person.
In rendering the foregoing opinion, we express no opinion
as to laws other than the laws of the State of New York and the
federal laws of the United States of America.
Very truly yours,
EMMET, MARVIN & MARTIN, LLP
ATLANTIC ENERGY EXHIBIT P
FORM OF ASSIGNMENT AND ACCEPTANCE AGREEMENT
This Assignment and Acceptance Agreement is made and en-
tered into as of _____ __, 19__, by and between ____________ (the
"Assignor") and ____________ (the "Assignee").
R E C I T A L S
4. All capitalized terms not otherwise defined herein
which are used herein shall have the meanings set forth in the
Facility A Credit Agreement (as defined below).
5. The Assignor, certain other lenders (together with
any prior assignees, the "Facility A Lenders") and The Bank of
New York, as agent (in such capacity the "Facility A Agent"), are
parties to that certain Revolving Credit Agreement (Facility A),
dated as of September 28, 1995 (the "Facility A Credit
Agreement") with ATLANTIC ENERGY, INC., a New Jersey corporation
(the "Borrower"). Pursuant to the Facility A Credit Agreement,
the Facility A Lenders (i) agreed to make Revolving Credit Loans
(the "Facility A Revolving Credit Loans") under the Aggregate
Commitments (as defined in the Facility A Credit Agreement, which
Aggregate Commitments are hereinafter referred to as the
"Aggregate Facility A Commitments") in the aggregate amount of
$35,000,000 and (ii) may, in their sole discretion and upon the
Borrower's request, make Competitive Bid Loans to the Borrower
from time to time (the "Facility A Competitive Bid Loans" and,
together with the Facility A Revolving Credit Loans, the
"Facility A Loans").
6. The amount of the Assignor's Facility A Commitment
(without giving effect to the assignment effected hereby or to
other assignments thereof which have not yet become effective) is
specified in Item 1 of Schedule 1 hereto. The outstanding
principal amount of the Assignor's Facility A Loans (without giv-
ing effect to the assignment effected hereby or to other as-
signments thereof which have not yet become effective) is
specified in Item 2 of Schedule 1 hereto.
7. The Assignor, certain other lenders (together with
any prior assignees, the "Facility B Lenders") and The Bank of
New York, as agent (in such capacity the "Facility B Agent" and,
together with it in its capacity as Facility A Agent, the
"Agent"), are parties to that certain Revolving Credit Agreement
(Facility B), dated as of September 28, 1995 (the "Facility B
Credit Agreement") with the Borrower. Pursuant to the Facility B
Credit Agreement, the Facility B Lenders (i) agreed to make
Revolving Credit Loans (the "Facility B Revolving Credit Loans")
under the Aggregate Commitments (as defined in the Facility B
Credit Agreement, which Commitments are hereinafter referred to
as the "Aggregate Facility B Commitments" and, together with the
Aggregate Facility A Commitments, the "Aggregate Commitments") in
the aggregate amount of $40,000,000 and to participate in Letters
of Credit issued by the Issuing Bank (under and as defined in the
Facility B Credit Agreement) and (ii) may, in their sole
discretion and upon the Borrowers' request make Competitive Bid
Loans to the Borrower from time to time (the "Facility B Competi-
tive Bid Loans" and, together with the Facility B Revolving
Credit Loans, the "Facility B Loans").
8. The amount of the Assignor's Facility B Commitment,
including its Letter of Credit Commitment (as defined in the
Facility B Credit Agreement and without giving effect to the
assignment effected hereby or to other assignments thereof which
have not yet become effective), is specified in Item 1 of
Schedule 1 hereto. The outstanding principal amount of the
Assignor's Facility B Loans, including its Letter of Credit
Exposure (as defined in the Facility B Credit Agreement and with-
out giving effect to the assignment effected hereby or to other
assignments thereof which have not yet become effective), is
specified in Item 2 of Schedule 1 hereto.
9. The Assignor wishes to sell and assign to the As-
signee, and the Assignee wishes to purchase and assume from the
Assignor, (i) the portion of the Assignor's Facility A Commitment
and Facility B Commitment specified in Item 3 of Schedule 1
hereto (the "Assigned Commitment") and (ii) the portion of the
Assignor's Facility A Revolving Credit Loans, Facility B
Revolving Credit Loans and/or the portion of the Assignor's
Facility A Competitive Bid Loans or Facility B Competitive Bid
Loans specified in Item 5 of Schedule 1 hereto (the "Assigned
Loans").
The parties agree as follows:
9.1. Assignment
Subject to the terms and conditions set forth herein
and in the Credit Agreements, the Assignor hereby sells and
assigns to the Assignee, and the Assignee hereby purchases and
assumes from the Assignor, without recourse, on the date set
forth above (the "Assignment Date") (i) all right, title and
interest of the Assignor to the Assigned Loans and (ii) all
obligations of the Assignor under the Credit Agreements with
respect to the Assigned Commitment. As full consideration for
the sale of the Assigned Loans and the Assigned Commitment, the
Assignee shall pay to the Assignor on the Assignment Date the
principal amount of the Assigned Loans (the "Purchase Price")
[and the Assignor shall pay to the Assignee on the Assignment
Date the fee specified in Item 6 of Schedule 1 hereto]. It is
understood by the parties hereto that each sale, assignment,
transfer or negotiation of rights under the Credit Agreements
shall be of an equal percentage of such Lenders interest under in
each of the Credit Agreements, it being the intention that at all
times during which the Facility A Credit Agreement and Facility B
Credit Agreement are both in effect, each Facility A Lender shall
be a Facility B Lender and its Commitment Percentage in each
thereof shall be identical.
9.2. Representation and Warranties
Each of the Assignor and the Assignee represents and
warrants to the other that (i) it has full power and legal right
to execute and deliver this Agreement and to perform the
provisions of this Agreement; (ii) the execution, delivery and
performance of this Agreement have been authorized by all action,
corporate or otherwise, and do not violate any provisions of its
charter or by-laws or any contractual obligations or requirement
of law binding on it; and (iii) this Agreement constitutes its
legal, valid and binding obligation, enforceable against it in
accordance with its terms. The Assignor further represents that
it is the legal and beneficial owner of the interest being
assigned by it hereunder and that such interest is free and
clear of any adverse claim created by the Assignor.
9.3. Condition Precedent
The obligations of the Assignor and the Assignee
hereunder shall be subject to the fulfillment of the conditions
that the Assignor shall have (i) received payment in full of the
Purchase Price and (ii) complied with the other applicable
provisions of Section 11.7 of each Credit Agreement.
9.4. Notice of Assignment
The Assignor agrees to give notice of the assignment
and assumption of the Assigned Loans and the Assigned Commitment
to the Agent and the Borrower and hereby instructs the Agent and
the Borrower to make all payments with respect to the Assigned
Loans and the Assigned Commitment directly to the Assignee at the
applicable Lending Offices specified on Schedule 2 hereto;
provided, however, that the Borrower and the Agent shall be
entitled to continue to deal solely and directly with the
Assignor in connection with the interests so assigned until the
Agent, the Issuing Bank and the Borrower, to the extent required
by Section 11.7 of each Credit Agreements, shall have received
notice of the assignment and shall have consented in writing
thereto by signing this Agreement and the Agent shall have
recorded and accepted this Agreement and received the Assignment
Fee required to be paid pursuant to Section 11.7 of each Credit
Agreement. From and after the date (the "Assignment Effective
Date") on which the Agent shall notify the Borrower and the
Assignor that the requirements set forth in the foregoing
sentence shall have occurred and all consents (if any) required
shall have been given, (i) the Assignee shall be deemed to be a
party to the Credit Agreements and, to the extent that rights and
obligations thereunder shall have been assigned to the Assignee
as provided in such notice of assignment to the Agent, shall have
the rights and obligations of a Lender under the Credit
Agreements, and (ii) the Assignee shall be deemed to have
appointed the Agent to take such action as agent on its behalf
and to exercise such powers under the Loan Documents as are
delegated to the Agent by the terms thereof, together with such
powers as are reasonably incidental thereto. After the
Assignment Effective Date, the Agent shall make all payments in
respect of the interest assigned hereby (including payments of
principal, interest, fees and other amounts) to the Assignee.
The Assignor and Assignee shall make all appropriate adjustment
in payments under the Assigned Loans and the Assigned Commitment
for periods prior to the Assignment Effective Date hereof
directly between themselves. If the Assignee is not a United
States Person as defined in Section 7701(a)(30) of the Code, the
Assignee shall deliver herewith the forms required by Section
2.10(c) of the Credit Agreements to evidence the Assignee's
complete exemption from United States withholding taxes with
respect to payments under the Loan Documents.
9.5. Independent Investigation
The Assignee acknowledges that it is purchasing the
Assigned Loans and the Assigned Commitments from the Assignor
totally without recourse and, except as provided in Section 2
hereof, without representation or warranty. The Assignee further
acknowledges that it has made its own independent investigation
and credit evaluation of the Borrower in connection with its
purchase of the Assigned Loans and the Assigned Commitments.
Except for the representations or warranties set forth in Section
2, the Assignee acknowledges that it is not relying on any
representation or warranty of the Assignor, expressed or implied,
including, without limitation, any representation or warranty
relating to the legality, validity, genuineness, enforceability,
collectibility, interest rate, repayment schedule or accrual
status of the Assigned Loans or the Assigned Commitment, the
legality, validity, genuineness or enforceability of any Loan
Document, or financial condition or creditworthiness of the
Borrower or any other Person. The Assignor has not and will not
be acting as either the representative, agent or trustee of the
Assignee with respect to matters arising out of or relating to
the Credit Agreements or this Agreement. From and after the
Assignment Effective Date, except as set forth in Section 4
above, the Assignor shall have no rights or obligations with
respect to the Assigned Loans or the Assigned Commitments.
9.6. Consent of the Borrower; Issuance of Notes.
(a) Pursuant to the provisions of Section 11.7 of
each Credit Agreement, and to the extent required thereby, the
Borrower, by signing below, consents to this Agreement and to the
assignment contemplated herein. The Borrower further agrees to
execute and deliver:
(i) to the Assignee, (1) a
Facility A Revolving Credit Note, in an aggregate principal
amount of $____, (2) a Facility B Revolving Credit Note, in an
aggregate principal amount of $____, (3) a Facility A Competitive
Bid Note and (4) a Facility B Competitive Bid Note; and
(ii) to the Assignor, (1) a
Facility A Revolving Credit Note, in an aggregate principal
amount of $____, and (2) a Facility B Revolving Credit Note, in
an aggregate principal amount of $____.
(b) Upon receipt of its new Notes as set forth in
subsection (a)(ii) above, the Assignor shall deliver its replaced
Facility A Revolving Credit Note and Facility B Revolving Credit
Note to the Borrower.
9.7. Method of Payment
All payments to be made by either party hereunder
shall be in funds available at the place of payment on the same
day and shall be made by wire transfer to the account designated
by the party to receive payment.
9.8. Integration
This Agreement shall supersede any prior agreement or
understanding between the parties (other than the Credit
Agreements) as to the subject matter hereof.
9.9. Counterparts
This Agreement may be executed in any number of
counterparts, each of which shall be deemed to be an original and
shall be binding upon both parties, their successors and assigns.
9.10. Headings
Section headings have been inserted herein for
convenience only and shall not be construed to be a part hereof.
9.11. Amendments; Waivers
This Agreement may not be amended, changed, waived or
modified except by a writing executed by the parties hereto, and
may not be amended, changed, waived or modified in any manner
inconsistent with Section 11.7 of each Credit Agreement without
the prior written consent of the Agent.
9.12. Governing Law.
This Agreement shall be governed by, and construed
and interpreted in accordance with, the internal laws of the
State of New York, without regard to principles of conflict of
laws.
IN WITNESS WHEREOF, the parties hereto have caused this
Assignment and Acceptance Agreement to be duly executed and
delivered by their proper and duly authorized officers as of the
day and year first above written.
, as Assignor
By:
Name:
Title:
, as Assignee
By:
Name:
Title:
Consented to:
ATLANTIC ENERGY, INC.
By:
Name:
Title:
Accepted:
THE BANK OF NEW YORK, as Agent
By:
Name:
Title:
THE BANK OF NEW YORK, as Issuing Bank
By:
Name:
Title:
SCHEDULE 1
TO
ASSIGNMENT AND ACCEPTANCE AGREEMENT
between
_____________________, as Assignor
and
_____________________, as Assignee
relating to
Revolving Credit Agreement (Facility A) and
Revolving Credit Agreement (Facility B),
each dated as of September 28, 1995
among
ATLANTIC ENERGY, INC.,
the respective Lenders party thereto,
and
The Bank of New York, as Agent,
Item 9.13. Assignor's Commitments
(a) Facility A Commitment $
(b) Facility B Commitment $
Item 9.14. Assignor's Loans:
(a) Facility A Revolving
Credit Loans* consisting
of:
ABR Advances $
Eurodollar Advances $
Letter of Credit Exposure $
(b) Facility A Competitive
Bid Loans* consisting of Loans
at the interest rates and
for the Interest Periods
set forth below:
Rate: __% Interest Period: ___ $___________
Rate: __% Interest Period: ___ $___________
Rate: __% Interest Period: ___ $___________
(c) Facility B Revolving
Credit Loans* consisting
of:
ABR Advances $___________
Eurodollar Advances $___________
(d) Facility B Competitive
Bid Loans* consisting of Loans
at the interest rates and
for the Interest Periods
set forth below:
Rate: __% Interest Period: ___ $___________
Rate: __% Interest Period: ___ $___________
Rate: __% Interest Period: ___ $___________
Item 9.15. Amount of Assigned Commitments:
(a) Assigned Facility A Revolving
Credit Commitment $___________
(b) Assigned Facility B Revolving
Credit Commitment $___________
Item 9.16. Percentage of Assigned Commitments
in Facility A as a percentage of
the Aggregate Commitments
of Facility A of all Facility
A Lenders ___%
Percentage of Assigned Commitments
in Facility B as a percentage of
the Aggregate Commitments
of Facility B of all Facility
A Lenders ___%
Item 9.17. Amount of Assigned Loans:
(a) Assignor's Facility A Revolving
Credit Loans consisting
of:
ABR Advances $___________
Eurodollar Advances $___________
Letter of Credit Exposure $___________
(b) Assignor's Facility A Competitive
Bid Loans consisting of Loans
at the interest rates and
for the Interest Periods
set forth below:
Rate: __% Interest Period: ___ $___________
Rate: __% Interest Period: ___ $___________
Rate: __% Interest Period: ___ $___________
(c) Assignor's Facility B Revolving
Credit Loans consisting
of:
ABR Advances $___________
Eurodollar Advances $___________
(d) Assignor's Facility B Competitive
Bid Loans consisting of Loans
at the interest rates and
for the Interest Periods
set forth below:
Rate: __% Interest Period: ___ $___________
Rate: __% Interest Period: ___ $___________
Rate: __% Interest Period: ___ $___________
Item 6. Amount of Fee
payable to Assignee $___________
SCHEDULE 2
TO
ASSIGNMENT AND ACCEPTANCE AGREEMENT
between
_____________________, as Assignor
and
_____________________, as Assignee
relating to
Revolving Credit Agreement (Facility A) and
Revolving Credit Agreement (Facility B),
each dated as of September 28, 1995
among
ATLANTIC ENERGY, INC.,
the respective Lenders party thereto,
and
The Bank of New York, as Agent,
DOMESTIC LENDING OFFICE EURODOLLAR LENDING OFFICE
____________________ ____________________
____________________ ____________________
____________________ ____________________
Attention: ______________ Attention: ______________
Telephone: (___) ___-____ Telephone: (___) ___-____
Telecopy: (___) ___-____ Telecopy: (___) ___-____
ADDRESS FOR NOTICES
____________________
____________________
____________________
Attention: ______________
Telephone: (___) ___-____
Telecopy: (___) ___-____
ATLANTIC ENERGY EXHIBIT Q
FORM OF GUARANTY AND SUBORDINATION AGREEMENT
Guaranty and Subordination Agreement (as the same may be amended,
supplemented or otherwise modified from time to time, this "Guaranty"),
dated as of _____ __, 199_, made by _________, a ______ corporation ("
") and each Person which becomes a party hereto pursuant to Section
10 hereof (together with _________, the "Guarantors", each, a
"Guarantor") and ATLANTIC ENERGY, INC., a New Jersey corporation (the
"Borrower") to THE BANK OF NEW YORK, as Agent (in such capacity, the
"Agent") [(i)] for itself and for the ratable benefit of the Lenders.
9.18. The Borrower has entered into two Revolving Credit
Agreements (Facility A and Facility B), dated as of September 28, 1995,
among the Borrower, the signatory Lenders thereto and the Agent (as the
same may be amended, extended, increased, modified, refunded or
refinanced from time to time, the "Credit Agreements"). Section 8.7 of
the Credit Agreements provides that the Guarantors and the Borrower
shall execute and deliver this Guaranty in the event that the Borrower
shall convert or forgive Intercompany Notes of the Guarantors.
9.19. The Guarantors have derived and expect to continue to
derive substantial benefit from the Credit Agreements and the making of
the Loans and the issuance of the Letters of Credit thereunder,
including, without limitation, the lending, directly or indirectly, by
the Borrower of a portion of the proceeds of the Loans to the
Guarantors. The Guarantors acknowledge that the Agent and the Lenders
are relying on this Guaranty in agreeing to continue to make the Loans
subsequent to the conversion or forgiveness of an Intercompany Note, and
that the Agent and the Lenders would not do so without the execution and
delivery of this Guaranty.
9.20. Each of the Guarantors wishes to (i) guarantee the
obligations of the Borrower under the Loan Documents and (ii)
subordinate, subject to the terms and conditions contained herein, any
obligations due it from the Borrower to the prior indefeasible cash
payment in full of the Borrower Obligations (as hereinafter defined).
In consideration of the premises and agreements herein contained
and other good and valuable consideration, the receipt and sufficiency
of which are hereby acknowledged, and in order to induce the Agent and
the Lenders to make the Loans and to induce BNY to issue the Letters of
Credit and the Lenders to participate therein, the Borrower and each of
the Guarantors covenant and agree as follows:
(a) Definitions
Except as otherwise provided herein, capitalized terms that
are defined in the Credit Agreements and are not defined herein shall
have the meanings assigned to such terms therein. For purposes hereof,
the following terms shall have the following meanings:
"Additional Guarantor": each Guarantor which becomes a party
hereto pursuant to Section 10 hereof.
"Borrower Obligations": all obligations and liabilities,
whether now existing or hereafter arising, of the Borrower under the
Loan Documents, whether direct, indirect or contingent, incurred as
primary obligor or otherwise, secured or unsecured, and whether or not
on open account, including all principal and interest thereon (whether
arising or accruing before or after the occurrence of any Event of
Default set forth in Section 9.1(i) or (j) of the Credit Agreements and
whether allowed as a claim), and all reasonable costs and expenses of
the Agent and the Lenders in enforcing, preserving and protecting any
thereof, whether or not suit is instituted (as the same may be amended,
increased, modified, renewed, refinanced, refunded or extended from time
to time).
"Consideration": as of any date of determination and with
respect to each Guarantor, an amount equal to the lesser of (a) the
total "value" (within the meaning of Section 548 of the Bankruptcy Code
as in effect on the date hereof) given, directly or indirectly, to such
Guarantor during the period commencing on the date such Guarantor became
a party to this Guaranty and ending on such date of determination, in
exchange for its execution and delivery of this Guaranty, and (b) the
amount of "fair consideration" (within the meaning of Article 10 of the
New York Debtor Creditor Law as in effect on the date hereof) given,
directly or indirectly, to such Guarantor during the period commencing
on the date such Guarantor became a party to this Guaranty and ending on
such date of determination in exchange for its execution and delivery of
this Guaranty.
"Guarantor Obligations": with respect to each Guarantor, all
of the obligations and liabilities of such Guarantor hereunder, whether
fixed, contingent, now existing or hereafter arising, created, assumed,
incurred or acquired.
"Net Worth": as of any date and with respect to each
Guarantor, the lesser of the following:
(a)(i) all of such Guarantor's "property, at a fair
valuation" (within the meaning of Section 101(32) of the Bankruptcy Code
as in effect on the date hereof) on such date, minus (ii) the sum of
such Guarantor's "debts" (within the meaning of Section 101(12) of the
Bankruptcy Code as in effect on the date hereof) on such date, or
(b)(i) the "fair salable value of the assets" (within the
meaning of Article 10 of the New York Debtor Creditor Law as in effect
on the date hereof) of such Guarantor on such date, minus (ii) "the
amount that will be required to pay such Guarantor's probable liability
on its existing debts as they become absolute and matured" (as such
phrase would be construed under Article 10 of the New York Debtor
Creditor Law as in effect on the date hereof) on such date.
"Subordinated Debt": all indebtedness for borrowed money and
any other obligations, contingent or otherwise, of the Borrower to any
Guarantor, including, without limitation, all amounts, fees and expenses
payable by the Borrower to any Guarantor in respect thereof, in each
case whether outstanding on the date of execution of this Guaranty or
hereafter arising or created.
"Supplement": a Supplement to this Guaranty, duly completed,
in the form of Annex 1 hereto.
(b) Guaranty
(1) Subject to Section 2(b) hereof, each Guarantor hereby
absolutely, irrevocably and unconditionally guarantees the full and
prompt payment when due (whether at stated maturity, by acceleration or
otherwise) of the Borrower Obligations. This Guaranty constitutes a
guaranty of payment, and neither the Agent nor any Lender shall have any
obligation to enforce any Loan Document or exercise any right or remedy
with respect to any collateral security thereunder by any action,
including, without limitation, making or perfecting any claim against
any Person or any collateral security for any of the Borrower
Obligations prior to being entitled to the benefits of this Guaranty.
The Agent may, at its option, proceed against the Guarantors, or any one
or more of them, in the first instance to enforce the Guarantor
Obligations without first proceeding against the Borrower or any other
Person, and without first resorting to any other rights or remedies, as
the Agent may deem advisable. In furtherance hereof, if the Agent or
any Lender is prevented by law from collecting or otherwise hindered
from collecting or otherwise enforcing any Borrower Obligation in
accordance with its terms, the Agent or such Lender, as the case may be,
shall be entitled to receive hereunder from the Guarantors after demand
therefor, the sums which would have been otherwise due had such
collection or enforcement not been prevented or hindered.
(2) Notwithstanding anything to the contrary contained in
this Guaranty, the maximum liability of each Guarantor hereunder shall
not, as of any date of determination, exceed the lesser of (i) the
highest amount that is valid and enforceable against such Guarantor
under principles of New York State contract law, and (ii) the sum of (1)
all Consideration received by such Guarantor as of such date of
determination, plus (2) the lesser of (A) 95% of the Net Worth of such
Guarantor on the date such Guarantor became a party to this Guaranty
after giving effect to (1) this Guaranty and (2) the receipt by such
Guarantor of any Consideration on the date such Guarantor became a party
to this Guaranty, and (B) 95% of the Net Worth of such Guarantor on such
date of determination.
(3) Each Guarantor agrees that its Guarantor Obligations may
at any time and from time to time exceed the maximum liability of such
Guarantor hereunder without impairing this Guaranty or affecting the
rights and remedies of the Agent or any Lenders hereunder.
(4) Subject to the limitations contained in Section 2(b), the
obligations hereunder of each Guarantor shall be joint and several with
the obligations hereunder of the other Guarantors from time to time
party hereto.
(c) Absolute Obligation
Subject to Section 9, no Guarantor shall be released from
liability hereunder unless and until the Maturity Date shall have
occurred and either (a) the Borrower Obligations shall have been
indefeasibly paid in full, in cash, or (b) the Guarantor Obligations of
such Guarantor shall have been paid in full, in cash. Each Guarantor
acknowledges and agrees that (1) neither the Agent nor any Lender has
made any representation or warranty to such Guarantor with respect to
the Borrower, its Subsidiaries, any Loan Document or any agreement,
instrument or document executed or delivered in connection therewith or
any other matter whatsoever, and (2) such Guarantor shall be liable
hereunder, and such liability shall not be affected or impaired,
irrespective of (A) the validity or enforceability of any Loan Document
or any agreement, instrument or document executed or delivered in
connection therewith, or the collectability of any of the Borrower
Obligations, (B) the preference or priority ranking with respect to any
of the Borrower Obligations, (C) the existence, validity, enforceability
or perfection of any security interest or collateral security under any
Loan Document or the release, exchange, substitution or loss or
impairment of any such security interest or collateral security, (D)
any failure, delay, neglect or omission by the Agent or any Lender to
realize upon any direct or indirect collateral security, indebtedness,
liability or obligation, any Loan Document or any agreement, instrument
or document executed or delivered in connection therewith, or any of the
Borrower Obligations, (E) the existence or exercise of any right of
set-off by the Agent or any Lender, (F) the existence, validity or
enforceability of any other guaranty with respect to any of the Borrower
Obligations, the liability of any other Person in respect of any of the
Borrower Obligations, or the release of any such Person or any other
guarantor of any of the Borrower Obligations, (G) any act or omission of
the Agent or any Lender in connection with the administration of any
Loan Document or any of the Borrower Obligations, (H) the bankruptcy,
insolvency, reorganization or receivership of, or any other proceeding
for the relief of debtors commenced by or against, any Person, (I) the
disaffirmance or rejection, or the purported disaffirmance or purported
rejection, of any of the Borrower Obligations, any Loan Document or any
agreement, instrument or document executed or delivered in connection
therewith, in any bankruptcy, insolvency, reorganization or
receivership, or any other proceeding for the relief of debtors,
relating to any Person, (J) any law, regulation or decree now or
hereafter in effect which might in any manner affect any of the terms or
provisions of any Loan Document or any agreement, instrument or document
executed or delivered in connection therewith or any of the Borrower
Obligations, or which might cause or permit to be invoked any alteration
in the time, amount, manner or payment or performance of any of the
Borrower's obligations and liabilities (including, without limitation,
the Borrower Obligations), (K) the merger or consolidation of the
Borrower into or with any Person, (L) the sale by the Borrower of all or
any part of its assets, (M) the fact that at any time and from time to
time none of the Borrower Obligations may be outstanding or owing to the
Agent or any Lender, (N) any amendment or modification of, or supplement
to, any Loan Document or (O) any other reason or circumstance which
might otherwise constitute a defense available to or a discharge of the
Borrower in respect of its obligations or liabilities (including,
without limitation, the Borrower Obligations) or of such Guarantor in
respect of any of the Guarantor Obligations (other than by the
performance in full thereof).
(d) Representations and Warranties
Each of the Guarantors hereby makes the following
representations and warranties to the Agent:
(1) Existence and Power. It is duly organized or formed
and validly existing in good standing under the laws of the jurisdiction
of its incorporation or formation, has all requisite power and authority
to own its Property and to carry on its business as now conducted, and
is in good standing and authorized to do business as a foreign
corporation in each jurisdiction in which the nature of the business
conducted therein or the Property owned therein makes such qualification
necessary, except where such failure to qualify could not reasonably be
expected to have a Material Adverse Effect.
(2) Authority. It has full legal power and authority to
enter into, execute, deliver and perform the terms of the Loan Documents
to which it is a party and the transactions contemplated thereby, all of
which have been duly authorized by all proper and necessary corporate or
other applicable action and are in full compliance with its Certificate
of Incorporation or By-Laws or its other organization documents.
(3) Binding Agreement. The Loan Documents to which its
is a party constitute its valid and legally binding obligations,
enforceable in accordance with its terms, except as such enforceability
may be limited by applicable bankruptcy, insolvency, reorganization or
other similar laws affecting the enforcement of creditors' rights
generally.
(4) Litigation. Except as disclosed in a schedule to the
Credit Agreements, there are no actions, suits or proceedings at law or
in equity or by or before any Governmental Authority (whether
purportedly on its behalf) pending or, to its knowledge, threatened
against it or any of its Property or rights, which (i) if adversely
determined, could reasonably be expected to have a Material Adverse
Effect, (ii) call into question the validity or enforceability of any of
the Loan Documents, (iii) could reasonably be expected to result in the
rescission, termination or cancellation of any material franchise,
right, license, permit or similar authorization held by it or (iv) might
materially and adversely affect any of the Transactions.
(5) Required Consents. No consent, authorization or
approval of, filing with, notice to, or exemption by, stockholders, any
Governmental Authority or any other Person is required to authorize, or
is required in connection with the execution, delivery and performance
of the Loan Documents to which it is a party and the transactions
contemplated thereby, or is required as a condition to the validity or
enforceability of such Loan Documents.
(6) No Conflicting Agreements. It is not in default
under any mortgage, indenture, contract or agreement to which it is a
party or by which it or any of its Property is bound, the effect of
which default could reasonably be expected to have a Material Adverse
Effect. The execution, delivery or carrying out of the terms of the
Loan Documents to which it is a party and the transactions contemplated
thereby, will not constitute a default under, or result in the creation
or imposition of, or obligation to create, any Lien upon any of its
Property or result in a breach of or require the mandatory repayment of
or other acceleration of payment under or pursuant to the terms of any
such mortgage, indenture, contract or agreement.
(7) Compliance with Applicable Laws. It is not in default
with respect to any judgment, order, writ, injunction, decree or
decision of any Governmental Authority which default could reasonably be
expected to have a Material Adverse Effect. It is complying in all
material respects with all statutes, regulations, rules and orders
applicable to it of all Governmental Authorities a violation of which
could reasonably be expected to have a Material Adverse Effect.
(8) Property. It has good and marketable title to all of
its Property, title to which is material to such Guarantor, subject to
no Liens, except for Liens described in Section 8.2(i), (ii), (iii),
(iv), (v), (vi) or (vii) of the Credit Agreements.
(9) Franchises, Intellectual Property, Etc. It possesses
or has the right to use all franchises, Intellectual Property, licenses
and other rights as are material and necessary for the conduct of its
business, and with respect to which it is in compliance, with no known
conflict with the valid rights of others which could reasonably be
expected to have a Material Adverse Effect. No event has occurred which
permits or, to the best of its knowledge, after notice or the lapse of
time or both, or any other condition, could reasonably be expected to
permit, the revocation or termination of any such franchise,
Intellectual Property, license or other right which revocation or
termination could reasonably be expected to have a Material Adverse
Effect.
(10) No Misrepresentation. No representation or warranty
contained in any Loan Document to which it is a party and no certificate
or report furnished or to be furnished by it in connection with the
transactions contemplated thereby, contains or will contain a
misstatement of material fact, or, to the best of its knowledge, omits
or will omit to state a material fact required to be stated in order to
make the statements therein contained not misleading in the light of the
circumstances under which made.
(e) Events of Default
Each of the following shall constitute an "Event of Default"
hereunder:
(1) Any of the Guarantors shall fail to observe or
perform any term, covenant or agreement contained in Section 2 of this
Guaranty; or
(2) Any of the Guarantors shall fail to perform or
observe any other term, covenant or agreement on its part to be
performed or observed pursuant to this Guaranty and such failure shall
have continued unremedied for a period of 30 days after such Guarantor
shall become aware of such failure; or
(3) Any representation of any Guarantor contained herein
or in any certificate, report or notice delivered or to be delivered by
such Guarantor pursuant hereto shall prove to have been incorrect or
misleading in any material respect when made; or
(4) This Guaranty shall cease to be in full force and
effect or any of the Guarantors shall so assert or shall disavow any of
its obligations hereunder; or
(5) The occurrence of an "Event of Default" under and as
defined in the Credit Agreements.
(f) Subordination
(1) No payment of any nature whatsoever due in respect of the
Subordinated Debt payable to any of the Guarantors shall be made unless
and until the Borrower Obligations have been first indefeasibly paid in
full in cash.
(2) Upon any bankruptcy, insolvency, liquidation or
reorganization of the Borrower, or upon the filing of a petition in
bankruptcy or commencement of any proceeding in bankruptcy against the
Borrower or upon any distribution of the assets of the Borrower or upon
any dissolution, winding up, liquidation or reorganization of the
Borrower, whether in bankruptcy, insolvency, reorganization, arrangement
or receivership proceedings, or upon any assignment for the benefit of
creditors, or any other marshalling of the assets and liabilities of the
Borrower, or in the event any of the Subordinated Debt shall for any
reason become or be declared due and payable or otherwise:
(i) the Agent shall first be entitled to receive
indefeasible payment in full in cash of the Borrower Obligations
(whenever arising) before any Guarantor shall be entitled to receive any
payment on account of the Subordinated Debt;
(ii) any payment by, or distribution of the assets of,
the Borrower of any kind or character, whether in cash, property or
securities, to which any Guarantor would be entitled except for the
provisions of this Guaranty, in connection with the Subordinated Debt,
shall be paid or delivered by the Person making such payment or
distribution (whether a trustee in bankruptcy, a receiver, custodian or
liquidating trustee or otherwise) directly to the Agent to the extent
necessary to make payment in full in cash of the Borrower Obligations
remaining unpaid, after giving effect to any concurrent payment or
distribution (or provision therefor) in cash to the Agent; and
(iii) None of the Guarantors shall ask, demand by legal
proceedings or otherwise, or take or receive from the Borrower, by set-
off, counterclaim or in any other manner, any payment or distribution on
account of the Subordinated Debt other than as expressly permitted
hereunder;
(iv) Each of the Guarantors agrees to declare the
Subordinated Debt to be due and payable and, at least 30 days before the
time required by applicable law or rule, to file proof of claim
therefor, in default of which the Agent is hereby irrevocably authorized
so to declare and file in order to effectuate the provisions hereof; and
(v) The Agent shall have the right, and is hereby
authorized, to vote the interest of each Guarantor with respect to the
Subordinated Debt, including, without limitation, the right to make all
acceptances, rejections, consents or approvals on its behalf (including
the right to accept, approve or disapprove of any plan of
reorganization) in connection with any insolvency or other proceeding,
and to execute and deliver for and on behalf of the Guarantor any
instrument, agreement or other document in connection therewith, and if
for any reason this clause shall not be enforceable, each Guarantor
agrees to vote and give or make such acceptances, rejections, consents
or approvals in the manner directed by the Agent. Each of the
Guarantors hereby irrevocably appoints the Agent its attorney-in-fact
for purposes of exercising the rights and authority granted to it under
this clause.
Notwithstanding the foregoing, in the event that any payment
by, or distribution of the assets of, the Borrower of any kind or
character prohibited hereby, whether in cash, property or securities,
shall for any reason be received by any of the Guarantors in respect of
the Subordinated Debt, such payment or distribution shall be held in
trust for the benefit of the Agent, and shall be immediately paid over
to the Agent, to the extent necessary to make payment in full in cash of
the Borrower Obligations remaining unpaid, after giving effect to any
concurrent payment or distribution (or provision therefor) in cash to
the Agent.
(3) Without the prior written consent of the Agent, the
Borrower will not give, and none of the Guarantors will receive or
accept, any collateral of any nature whatsoever for the Subordinated
Debt on any Property or assets, whether now existing or hereafter
acquired, of the Borrower.
(4) Nothing contained in this Guaranty is intended to or
shall impair, as between and among the Borrower, its creditors (other
than the holders of the Borrower Obligations) and the Guarantors, the
obligation of the Borrower to pay to the Guarantors any amount due in
respect of the Subordinated Debt as and when the same shall become due
and payable in accordance with the terms thereof, or affect the relative
rights of the Guarantors and the creditors of the Borrower (other than
the holders of the Borrower Obligations), in each case subject to the
rights of the holders of the Borrower Obligations under this Guaranty.
(5) Unless and until the Borrower Obligations have been
indefeasibly paid in full in cash and the Credit Agreements have been
terminated, each of the Guarantors agrees not to declare any part of the
Subordinated Debt to be due and payable or exercise any of the rights or
remedies which it may have, or bring (in its capacity as holder of the
Subordinated Debt) or join with any other creditor in instituting, any
proceedings against the Borrower under any bankruptcy, insolvency,
reorganization, arrangement, receivership or other similar law, unless
the Borrower Obligations shall have been declared immediately due and
payable or, in the case of the institution of any such proceedings, the
Agent shall have joined in the institution thereof or expressly
consented thereto in writing. In the event that the Agent shall have so
declared the Borrower Obligations immediately due and payable, each of
the Guarantors agrees to declare the Subordinated Debt then due to be
due and payable, provided, however, if the Agent shall rescind any such
declaration, each of the Guarantors shall automatically be deemed to
have rescinded its declaration.
(6) No right of the Agent to enforce this Guaranty shall at
any time or in any way be prejudiced or impaired by any act or failure
to act on the part of any of the Guarantors, or by any noncompliance by
the Guarantors with the terms, provisions and covenants herein, and the
Agent are hereby expressly authorized to extend, waive, renew, increase,
decrease, modify or amend the terms of the Borrower Obligations or any
collateral security therefor, and to waive any default, modify, amend,
rescind or waive any provision of any document executed and delivered in
connection with the Borrower Obligations and to release, sell or
exchange any such collateral security and otherwise deal freely with the
Borrower, all without notice to or consent of the Guarantors and without
affecting the liabilities and obligations of the parties hereto.
(7) The Borrower and the Guarantors each waives notice of
acceptance of this Guaranty by the Agent and the Lenders, and each of
the Guarantors waives notice of and consents to the making, amount and
terms of the Borrower Obligations which may exist from time to time and
any renewal, extension, increase, amendment or modification thereof and
any other action which the Agent or the Lenders in its sole and absolute
discretion, may take or omit to take with respect thereto. This Section
(g) shall constitute a continuing offer to the Agent and the Lenders,
its provisions are made for the benefit of the Agent and the Lenders,
and the Agent and the Lenders are made obligees hereunder and may
enforce such provisions.
(8) Each of the Guarantors agrees that no payment or
distribution to the Agent pursuant to the provisions of this Guaranty
shall entitle any of the Guarantors to exercise any rights of
subrogation in respect thereof until the Borrower Obligations shall have
been indefeasibly paid in full in cash. Each of the Guarantors agrees
that the subordination provisions contained herein shall not be affected
by any action or failure to act by the holders of the Borrower
Obligations which results, or may result, in affecting, impairing or
extinguishing any right of reimbursement or subrogation or other right
or remedy of such Guarantor.
(9) None of the Guarantors shall sell, assign, transfer or
otherwise dispose of all or any part of the Subordinated Debt without
having first obtained the prior written consent of the Agent which
consent may be withheld for any reason or for no reason.
(10) The Borrower agrees that it will not make any payment of
any of the Subordinated Debt, or take any other action, in contravention
of the provisions of this Guaranty.
(11) Each of the Guarantors agrees that the provisions of this
Guaranty shall be applicable to the Borrower Obligations whenever the
same may arise and notwithstanding the fact that no Borrower Obligations
may be outstanding from time to time and may have paid down to zero at
any time or from time to time, it being understood that the Credit
Agreements permit the Borrower to borrow, repay and reborrow from time
to time subject to the terms and conditions thereof, all or any of which
terms and conditions may be waived.
(12) All rights and interests of the Agent hereunder, and all
agreements and obligations of the Borrower and the Guarantors under this
Guaranty, shall remain in full force and effect irrespective of:
(i) any lack of validity or enforceability of any of the
Loan Documents;
(ii) any change in the time, manner or place of payment
of, or any other term of, all or any of the Borrower Obligations, or any
other amendment or waiver of or any consent to departure from any of the
Borrower Obligations;
(iii) any exchange, release or non-perfection of the
Collateral, or any release or amendment or waiver of or consent to or
departure from any guaranty, for all or any of the Borrower Obligations;
or
(iv) any other circumstance which might otherwise
constitute a defense available to, or a discharge of, the Borrower in
respect of the Borrower Obligations or this Guaranty. This Guaranty
shall continue to be effective or be reinstated, as the case may be, if
at any time any payment of any of the Borrower Obligations is rescinded
or must otherwise be returned by the Agent upon the insolvency,
bankruptcy or reorganization of the Borrower or otherwise, all as though
such payment had not been made.
(13) Each of the Guarantors authorizes the Agent, without
notice or demand and without affecting or impairing the obligations of
any of the Guarantors, from time to time to (i) renew, compromise,
extend, increase, accelerate or otherwise change the time for payment
of, or otherwise change the terms of the Borrower Obligations, or any
part thereof, including, without limitation, to increase or decrease the
rate of interest thereon or the principal amount thereof; (ii) take or
hold security for the payment of the Borrower Obligations and exchange,
enforce, foreclose upon, waive and release any such security; (iii)
apply such security and direct the order or manner of sale thereof as
the Agent, in its sole discretion, may determine; (iv) release and
substitute one or more indorsers, warrantors, borrowers or other
obligors; and (v) exercise or refrain from exercising any rights against
the Borrower or any other Person.
(g) Notices
Except as otherwise specifically provided herein, all notices,
requests, consents, demands, waivers and other communications hereunder
shall be given in the manner provided in Section 11.2 of the Credit
Agreements and, if to the Agent or the Borrower, at their respective
addresses set forth therein or, if to the Guarantor, the address set
forth below (or if to an Additional Guarantor, to the address set forth
in the Supplement executed and delivered by such Additional Guarantor)
or to such other addresses as to which the Agent may be hereafter
notified by the respective parties hereto:
Attention: ,
Telephone: (___) ___-____
Fax: (___) ___-____.
(h) Expenses
The Guarantors will upon demand pay to the Agent any and all
reasonable sums, costs and expenses which the Agent may pay or incur
pursuant to the provisions of this Guaranty or in negotiating, executing
or enforcing this Guaranty or in enforcing payment of its Guarantor
Obligations, including, but not limited to court costs, reasonable
collection charges, reasonable travel expenses, and reasonable
attorneys' fees and disbursements. All sums, costs and expenses which
are due and payable pursuant to this Section shall bear interest,
payable on demand, at the highest rate then payable on the Borrower
Obligations.
(i) Repayment in Bankruptcy, etc.
If, at any time or times subsequent to the payment of all or
any part of the Borrower Obligations or the Guarantor Obligations, the
Agent or any Lender shall be required to repay any amounts previously
paid by or on behalf of the Borrower or any Guarantor in reduction
thereof by virtue of an order of any court having jurisdiction in the
premises, including, without limitation, as a result of an adjudication
that such amounts constituted preferential payments or fraudulent
conveyances, the Guarantors unconditionally agree to pay to the Agent
within 10 days after demand a sum in cash equal to the amount of such
repayment, together with interest on such amount from the date of such
repayment by the Agent or such Lender, as the case may be, to the date
of payment to the Agent at the applicable after-maturity rates set forth
in the Credit Agreements.
(j) Additional Guarantors
Upon the execution and delivery to the Agent of a Supplement
by any Person, such Person shall be a Guarantor.
(k) Other Provisions
(1) This Guaranty is the "Guaranty" referred to in the Credit
Agreements. Each of the Agent and the Guarantors acknowledges that
certain provisions of the Credit Agreements, including, without
limitation, Sections 11.1 (Amendments and Waivers), 11.3 (No Waiver;
Cumulative Remedies), 11.7 (Assignments and Participations), 11.8
(Counterparts), 11.12 (Governing Law), 11.14 (Severability), 11.15.
(Integration), 11.16 (Consent to Jurisdiction), 11.17 (Service of
Process), 11.18 (No Limitation on Service or Suit) and 11.19 (WAIVER OF
TRIAL BY JURY) thereof, are made applicable to this Guaranty and all
such provisions are incorporated by reference herein as if fully set
forth herein.
(2) All Schedules and Annexes hereto shall be deemed to be a
part hereof. With respect to an Additional Guarantor, all references in
this Agreement to (i) a Schedule hereof shall refer to the corresponding
Schedule to the Supplement executed and delivered by such Additional
Guarantor and (ii) the date hereof, shall refer to the date on which the
Additional Guarantor became a Grantor hereunder by executing and
delivering a Supplement.
(3) No failure by the Agent to exercise, and no delay by the
Agent in exercising, any right or remedy hereunder shall operate as a
waiver thereof.
(4) Each and every right, remedy and power granted to the
Agent hereunder or allowed at law, in equity or by other agreement shall
be cumulative and not exclusive, and may be exercised by the Agent from
time to time.
(5) Each Guarantor hereby waives presentment, demand for
payment, notice of default, nonperformance and dishonor, protest and
notice of protest of or in respect of this Guaranty, the Loan Documents
and the Borrower Obligations, notice of acceptance of this Guaranty and
reliance hereupon by the Agent and each Lender, and the incurrence of
any of the Borrower Obligations, notice of any sale of collateral
security or any default of any sort and notice of any amendment,
modification, increase or waiver of any Loan Document.
(6) No Guarantor is relying upon the Agent or any Lender to
provide to such Guarantor any information concerning the Borrower or any
Subsidiary of the Borrower, and each Guarantor has made arrangements
satisfactory to such Guarantor to obtain from the Borrower on a
continuing basis such information concerning the Borrower and its
Subsidiaries as such Guarantor may desire.
(7) Each Guarantor agrees that any statement of account with
respect to the Borrower Obligations from the Agent or any Lender to the
Borrower which binds the Borrower shall also be binding upon such
Guarantor, and that copies of said statements of account maintained in
the regular course of the Agent's or such Lender's business, as the case
may be, may be used in evidence against such Guarantor in order to
establish its Guarantor Obligations.
(8) Each Guarantor acknowledges that it has received a copy
of the Loan Documents. In addition, such Guarantor acknowledges having
read each Loan Document and having had the advice of counsel in
connection with all matters concerning its execution and delivery of
this Guaranty, and, accordingly, waives any right it may have to have
the provisions of this Guaranty strictly construed against the Agent and
the Lenders.
The Guarantors and the Borrower have each caused this Guaranty to
be duly executed and delivered by its duly authorized officer as of the
date first above written.
By:
Name:
Title:
By:
Name:
Title:
Accepted and Agreed to:
THE BANK OF NEW YORK, as Agent
By:
Name:
Title:
Annex 1 to the Guaranty and
Subordination Agreement
FORM OF SUPPLEMENT TO GUARANTY AND SUBORDINATION AGREEMENT
SUPPLEMENT, dated as of _____ __, 199_, made by ___________, a ______
corporation (the "New Guarantor") to the Guaranty (the "Guaranty"),
dated as of ____ __, 1994, made by each Guarantor party thereto and
ATLANTIC ENERGY, INC., a New Jersey corporation (the "Borrower") to THE
BANK OF NEW YORK, as Agent (in such capacity, the "Agent").
Reference is made to the Credit Agreements (Facility A and Facility B),
dated as of September 28, 1995, by and among the Borrower, the Lenders
party thereto (the "Lenders") and the Agent (as the same may be amended,
extended, increased, modified, refunded or refinanced from time to time,
the "Credit Agreements").
Capitalized terms used herein and not otherwise defined herein shall
have the meanings assigned to such terms in the Guaranty or the Credit
Agreements, as the case may be.
Accordingly, the Agent and the New Guarantor agree as follows:
In accordance with Section 10 of the Guaranty, by signing this
Supplement, the New Guarantor (a) shall be, and shall be deemed to be,
a "Guarantor" under, and as such term is defined in, the Guaranty with
the same force and effect as if originally named therein as a Guarantor,
(b) shall have made, and shall be deemed to have made, the
representations and warranties contained in Section 4 of the Guaranty on
and as of the date hereof, and (c) shall have made, and shall be deemed
to have made, all of the covenants and agreements of a Guarantor set
forth in the Guaranty.
Except as expressly supplemented hereby, the Guaranty shall remain in
full force and effect.
This Supplement shall be governed by and construed in accordance with
the laws of the State of New York without regard to conflicts of laws
rules.
Every provision of this Supplement is intended to be severable, and if
any term or provision hereof shall be invalid, illegal or unenforceable
for any reason, the validity, legality and enforceability of the
remaining provisions hereof or thereof shall not be affected or impaired
thereby, and any invalidity, illegality or unenforceability in any
jurisdiction shall not affect the validity, legality or enforceability
of any such term or provision in any other jurisdiction.
For purposes of Section 7 of the Guaranty, the address of the New
Grantor is as follows:
Attention:
Telephone: (___) ___-____
Fax: (___) ___-____.
This Supplement may be executed in two or more counterparts, each
of which shall constitute an original, but all of which, when taken
together, shall constitute but one instrument. This Supplement shall
become effective when the Agent shall have received counterparts of this
Supplement that, when taken together, bear the signatures of the New
Grantor and the Agent.
The New Grantor and the Agent have duly executed this
Supplement to the Guaranty as of the day and year first above written.
[NAME OF NEW GUARANTOR]
By:
Name:
Title:
THE BANK OF NEW YORK, AS AGENT
By:
Name:
Title: