EXHIBIT 4(A)
TO FORM 10-Q,
1ST QUARTER 1998
TERM LOAN AGREEMENT
dated as of March 31, 1998
among
BANGOR ENERGY RESALE, INC.,
BANKBOSTON, N.A.
and
the other lending institutions listed on SCHEDULE 1 hereto
and
BANKBOSTON, N.A., as Agent
TABLE OF CONTENTS
Section 1. DEFINITIONS AND RULES OF INTERPRETATION. 1
Section 1.1. DEFINITIONS. 1
Section 1.2. Rules of Interpretation. 14
Section 2. THE TERM LOAN. 15
Section 2.1. Commitment to Lend. 15
Section 2.2. The Term Notes. 15
Section 2.3. Mandatory Payments of Principal of Term Loan. 16
Section 2.4. Optional Prepayment of Term Loan. 17
Section 2.5. Interest on Term Loan. 17
Section 2.6. Notification by Borrower. 18
Section 2.7. Conversion Options. 18
Section 3. CERTAIN GENERAL PROVISIONS. 19
Section 3.1. Fees. 19
Section 3.2. Payments. 19
Section 3.3. No Offset, etc. 19
Section 3.4. Computations. 20
Section 3.5. Interest Limitation. 20
Section 3.6. Indemnity. 20
Section 3.7. Inability to Determine LIBOR Rate. 21
Section 3.8. Illegality. 21
Section 3.9. Additional Costs, etc. 22
Section 3.10. Capital Adequacy. 23
Section 3.11. Certificate. 23
Section 3.12. Overdue Interest. 24
Section 3.13. Replacement Banks; Mitigation. 24
Section 4. SECURITY AND GUARANTY. 25
Section 4.1. Security of Borrower. 25
Section 4.2. Guaranty. 25
Section 5. REPRESENTATIONS AND WARRANTIES. 25
Section 5.1. Corporate Authority. 25
Section 5.2. Permits and Governmental Authority. 26
Section 5.3. Title to Properties; Leases. 26
Section 5.4. Financial Statements Projections; Solvency. 26
Section 5.5. No Material Changes, Etc. 27
Section 5.6. Franchises, Patents, Copyrights, Etc. 27
Section 5.7. Litigation. 27
Section 5.8. No Materially Adverse Contracts, Etc. 28
Section 5.9. Compliance With Other Instruments, Laws, Etc. 28
Section 5.10. Tax Status. 28
Section 5.11. No Event of Default. 28
Section 5.12. Governmental Regulation. 28
Section 5.13. Absence of Financing Statements, Etc. 29
Section 5.14. Perfection of Security Interests. 29
Section 5.15. Certain Transactions. 29
Section 5.16. Compliance with ERISA. 29
Section 5.17. Use of Proceeds. 29
Section 5.18. Subsidiaries, etc. 30
Section 5.19. Disclosure. 30
Section 5.20. Open Market Purchases. 30
Section 5.21. No Amendment to Documents; Documents in Full
Force. 30
Section 6. AFFIRMATIVE COVENANTS OF THE BORROWER. 30
Section 6.1. Punctual Payment. 30
Section 6.2. Records and Accounts. 31
Section 6.3. Financial Statements, Certificates and Other
Information. 31
Section 6.4. Corporate Existence and Conduct of Business. 32
Section 6.5. Maintenance of Properties. 32
Section 6.6. Maintenance of Office. 33
Section 6.7. Insurance. 33
Section 6.8. Taxes. 33
Section 6.9. Inspection of Properties, Books, and Contracts. 33
Section 6.10. Compliance with Laws, Contracts, Licenses and
Permits. 33
Section 6.11. Notice of Default. 34
Section 6.12. Environmental Events. 34
Section 6.13. Notification of Claim against Collateral. 34
Section 6.14. Notice of Litigation and Judgments. 34
Section 6.15. Use of Proceeds. 34
Section 6.16. Lockbox Account. 34
Section 6.17. Interest Rate Protection. 36
Section 6.18. Maintenance of Working Capital Reserve. 36
Section 6.19. Further Assurances. 36
Section 7. CERTAIN NEGATIVE COVENANTS OF THE BORROWER. 37
Section 7.1. Restrictions on Indebtedness. 37
Section 7.2. Restrictions on Liens. 37
Section 7.3. Restrictions on Investments. 38
Section 7.4. Merger, Consolidations, Sales. 39
Section 7.5. Distributions. 39
Section 7.6. Sale and Leaseback. 39
Section 7.7. Amendment to Unitil Contract and Acquisition
Documents. 40
Section 7.8. Business
Activities. 40
Section 7.9. Fiscal Year. 40
Section 7.10. Transactions with Affiliates. 40
Section 7.11. Bank Accounts. 40
Section 7.12. No Changes to Corporate Documents. 40
Section 8. FINANCIAL COVENANTS 40
Section 8.1. Net Worth. 41
Section 8.2. Debt Service Ratio. 41
Section 8.3. Capital Expenditures. 41
Section 9. CLOSING CONDITIONS. 41
Section 9.1. Loan Documents etc. 41
Section 9.2. Representations and Warranties. 41
Section 9.3. Performance; No Default. 42
Section 9.4. Certified Copies of Charter Documents. 42
Section 9.5. Proof of Corporate Action. 42
Section 9.6. Incumbency Certificate. 42
Section 9.7. Legality. 42
Section 9.8. Certificates of Insurance. 42
Section 9.9. Validity of Liens. 43
Section 9.10. Perfection Certificate; UCC Search Results. 43
Section 9.11. Borrower's and Guarantor's Financial Statement.43
Section 9.12. Proceedings and Documents. 43
Section 9.13. Other Consents and Approvals. 43
Section 9.14. Opinions of Counsel. 43
Section 9.15. Disbursement Instructions. 44
Section 9.16. No Legal Impediment. 44
Section 9.17. Interest Rate Protection Arrangements. 44
Section 9.18. Receipt of FERC Notification. 44
Section 9.19. Revision of Power Sale Agreement. 44
Section 9.20. Evidence of Revision of Code of Conduct 44
Section 10. EVENTS OF DEFAULT; ACCELERATION. 44
Section 10.1. Events of Default. 44
Section 10.2. Remedies. 47
Section 10.3. Distribution of Collateral Proceeds. 48
Section 11. SETOFF. 48
Section 12. THE AGENT. 49
Section 12.1. Authorization. 49
Section 12.2. Employees and Agents. 50
Section 12.3. No Liability. 50
Section 12.4. No Representations. 50
Section 12.5. Payments. 50
Section 12.6. Holders of Notes. 51
Section 12.7. Indemnity. 52
Section 12.8. Agent as Bank. 52
Section 12.9. Resignation. 52
Section 12.10. Notification of Defaults and Events of Default.
52
Section 12.11. Duties in the Case of Enforcement. 52
Section 13. EXPENSES AND INDEMNIFICATION. 53
Section 13.1. Expenses. 53
Section 13.2. Indemnification. 54
Section 13.3 Survival. 54
Section 14. TREATMENT OF CERTAIN CONFIDENTIAL INFORMATION. 55
Section 14.1. Sharing of Information with Section 20 Subsidiary.
55
Section 14.2. Confidentiality. 55
Section 14.3. Prior Notification. 55
Section 14.4. Other. 56
Section 15. SURVIVAL OF COVENANTS, ETC. 56
Section 16. ASSIGNMENT AND PARTICIPATION. 56
Section 16.1. Conditions to Assignment by Banks. 56
Section 16.2. Certain Representations and Warranties; Limitations;
Covenants. 57
Section 16.3. Register. 58
Section 16.4. New Notes. 58
Section 16.5. Participations. 58
Section 16.6. Disclosure. 59
Section 16.7. Assignee or Participant Affiliated with the
Borrower. 59
Section 16.8. Miscellaneous Assignment Provisions. 60
Section 16.9. Assignment by Borrower. 60
Section 17. NOTICES, ETC. 60
Section 18. GOVERNING LAW. 62
Section 19. HEADINGS. 62
Section 20. COUNTERPARTS. 62
Section 21. ENTIRE AGREEMENT, ETC. 62
Section 22. WAIVER OF JURY TRIAL. 62
Section 23. CONSENTS, AMENDMENTS, WAIVERS, ETC. 63
Section 24. SEVERABILITY. 63
TERM LOAN AGREEMENT
TERM LOAN AGREEMENT, dated as of March 31, 1998, among BANGOR ENERGY
RESALE, INC., a Maine corporation having its chief executive office at
33 State Street, P.O. Box 932, Bangor, Maine 04402 (the "BORROWER"),
BANKBOSTON, N.A., a national banking association and the other lending
institutions listed on SCHEDULE 1 hereto and BankBoston, N.A. as agent for
itself and such other lending institutions.
Section 1. DEFINITIONS AND RULES OF INTERPRETATION.
Section 1.1. DEFINITIONS.
ACCOUNTANTS. See Section 6.3(a).
ACQUISITION. The acquisition by the Borrower on the Acquisition
Closing Date of all of Bangor's right, titles and interest under the
Unitil Contract pursuant to the Acquisition Documents.
ACQUISITION CLOSING DATE. The first date on which the conditions
set forth on the Unitil Contract Assignment have been satisfied and the
Acquisition has occurred.
ACQUISITION DOCUMENTS. Collectively, the Rate Schedule Agreement,
the Unitil Contract Assignment, the Service Agreement and all agreements
and documents required to be entered into or delivered pursuant thereto
or in connection with the Acquisition, each in the form delivered to the
Agent on the Acquisition Closing Date.
AFFECTED BANK. See Section 3.13(a).
AFFILIATE. Affiliate of a specified Person means any other Person
that, directly or indirectly, controls or is controlled by or is under
common control with the Person in question or who holds or beneficially
owns ten percent (10%) or more of the equity interest in the specified
Person or ten percent (10%) or more of any class of voting securities of
the specified Person.
AGENT'S HEAD OFFICE. The Agent's head office located at 100
Federal Street, Boston, Massachusetts, or at such other location as the
Agent may designate from time to time.
AGENT. BankBoston, N.A., acting as Agent for the Banks.
AGREEMENT. This Term Loan Agreement, together with all Exhibits
and Schedules hereto, as amended or supplemented from time to time.
APPLICABLE LAWS. See Section 6.10.
ASSIGNMENT AND ACCEPTANCE. See Section 16.
BALANCE SHEET DATE. December 31, 1997.
BANGOR. Bangor Hydro-Electric Company, a Maine corporation and the
parent corporation of the Borrower.
BANKS. BKB and the other lending institutions listed on Schedule 1
hereto and any other Person who becomes an assignee of any rights and
obligations of a Bank pursuant to Section 16 hereof.
BASE RATE. The higher of (a) the annual rate of interest announced
from time to time by BKB at its head office in Boston, Massachusetts, as
its "base rate" and (b) one-half of one percent (1/2%) above the Federal
Funds Effective Rate. For the purposes of this definition, "Federal
Funds Effective Rate" shall mean for any day, the rate per annum 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, as published for such day (or, if such day is not
a Business Day, for the next preceding Business Day) by the Federal
Reserve Bank of New York, or, if such rate is not so published for any
day that is a Business Day, the average of the quotations for such day
on such transactions received by the Agent from three funds brokers of
recognized standing selected by the Agent.
BASE RATE LOANS. All or any portion of the Term Loan bearing
interest calculated by reference to the Base Rate.
BKB. BankBoston, N.A., a national banking association, in its
individual capacity.
BORROWER. See Preamble.
BUSINESS DAY. Any day on which commercial banking institutions in
Boston, Massachusetts are open for the conduct of normal banking
business and, in the case of LIBOR Rate Loans, also a day which is a
LIBOR Business Day.
CAPITAL ASSETS. Fixed assets, both tangible (such as land,
buildings, fixtures, machinery and equipment) and intangible (such as
patents, copyrights, trademarks, franchises and good will); provided
that Capital Assets shall not include any item customarily charged
directly to expense or depreciated over a useful life of twelve (12)
months or less in accordance with generally accepted accounting
principles.
CAPITAL EXPENDITURES. Amounts paid or Indebtedness incurred by the
Borrower in connection with (a) the purchase or lease by the Borrower of
Capital Assets that would be required to be capitalized and shown on the
balance sheet of the Borrower in accordance with generally accepted
accounting principles or (b) the lease of any assets by the Borrower as
lessee under any synthetic lease to the extent that such assets would
have been Capital Assets had the synthetic lease been treated for
accounting purposes as a Capitalized Lease.
CAPITALIZED LEASES. Leases under which the Borrower is the lessee
or obligor, the discounted future rental payment obligations under which
are required to be capitalized on the balance sheet of the lessee or
obligor in accordance with generally accepted accounting principles.
CASH COLLATERAL ACCOUNT. That certain cash collateral account of
the Borrower maintained by the Agent and subject to the Cash Collateral
Agreement.
CASH COLLATERAL AGREEMENT. That certain Cash Collateral Agreement
dated the Closing Date between the Borrower and the Agent.
CHASE. The Chase Manhattan Bank (formerly known as Chemical Bank),
in its capacity as administrative agent under the Chase Credit
Agreement.
CHASE BANKS. As defined in the definition of Chase Credit
Agreement.
CHASE CREDIT AGREEMENT. That certain Credit Agreement dated as of
June 30, 1995 (as amended by the First Amendment thereto dated as of
October 2, 1995, the Second Amendment thereto dated as of June 6, 1997
and the Third Amendment thereto dated as of November 30, 1997) among
Bangor, the several banks from time to time parties thereto (the "CHASE
BANKS"), Chase and Fleet Bank of Maine and BKB as co-agents.
CHASE CONSENT. That certain consent letter dated or to be dated on
or prior to the Closing Date among Bangor, Chase and the Chase Banks,
and in form and substance satisfactory to the Agent.
CLOSING DATE. The first day on which the conditions set forth in
Section 9 have been satisfied and the Term Loan is to be made.
CODE. The Internal Revenue Code of 1986, as amended and in effect
from time to time.
COLLATERAL. All of the property, rights and interests of the
Borrower that are or are intended to be subject to the security
interests created by the Security Documents.
COLLATERAL ASSIGNMENT. The Collateral Assignment of Contracts,
dated the Closing Date, between the Borrower and the Agent, and
substantially in the form of EXHIBIT A.
CONVERSION REQUEST. A notice given by the Borrower to the Agent of
the Borrower's election to convert or continue all or any portion of the
Term Loan in accordance with Section 2.7.
DEBT SERVICE RATIO. As at any date of determination, the ratio of
(a) (i) the actual cash payments made by Unitil to the Borrower for
System Power pursuant to the terms of the Unitil Contract for such
period, minus (ii) all costs and expenses incurred or to be incurred by
the Borrower in such period for such System Power (including, without
limitation, all costs and expenses relating thereto under the Service
Agreement as if the Substitute Rate Schedule referenced therein were
then in effect) to (b) Total Debt Service of the Borrower for such
period (exclusive of Total Debt Service attributable to any amounts
required to be paid by the Borrower pursuant to the last two sentences
of Section 16.5 hereof) less any interest income earned for such period.
DEFAULT(S). See Section 10.
DELINQUENT BANK. See Section 12.5.
DISTRIBUTION. The declaration or payment of any dividend on or in
respect of any shares of any class of capital stock of the Borrower,
other than dividends payable solely in shares of common stock of the
Borrower; or the purchase, redemption, or other retirement of any shares
of any class of capital stock of the Borrower, the return of capital by
the Borrower to its shareholders as such; any other distribution on or
in respect of any shares of any class of capital stock of the Borrower.
DOLLARS OR $. Dollars in lawful currency of the United States of
America.
DOMESTIC LENDING OFFICE. Initially, the office of each Bank
designated as such on SCHEDULE 1 hereto; and, after such Bank has
provided the Borrower and the Agent with written notice of a change in
the office, such other office of such Bank, if any, located within the
United States that will be making or maintaining Base Rate Loans.
DRAWDOWN DATE. The date on which the Term Loan is made or is to be
made, and the date on which all or any portion of the Term Loan is
converted or continued in accordance with Section 2.7.
ELIGIBLE ASSIGNEE. Any of (a) a commercial bank or finance company
organized under the laws of the United States, or any State thereof or
the District of Columbia, and having total assets in excess of
$1,000,000,000; (b) a savings and loan association or savings bank
organized under the laws of the United States, or any State thereof or
the District of Columbia, and having a net worth of at least
$100,000,000, calculated in accordance with generally accepted
accounting principles; (c) a commercial bank organized under the laws of
any other country which is a member of the Organization for Economic
Cooperation and Development (the "OECD"), or a political subdivision of
any such country, and having total assets in excess of $1,000,000,000,
Provided that such bank is acting through a branch or agency located in
the country in which it is organized or another country which is also a
member of the OECD; (d) the central bank of any country which is a
member of the OECD; and (e) if, but only if, any Event of Default has
occurred and is continuing, any other bank, insurance company,
commercial finance company or other financial institution or Person (not
being an individual), in each case approved by the Agent, such approval
not to be unreasonably withheld.
EMPLOYEE BENEFIT PLAN, (or "PLAN"). Any employee benefit plan
within the meaning of Section 3(3) of ERISA maintained or contributed
to by the Borrower or any ERISA Affiliate, other than a Guaranteed
Pension Plan or a Multiemployer Plan.
ENVIRONMENTAL LAWS. Any judgment, decree, order, law, license,
rule or regulation pertaining to environmental matters, including those
arising under the Resource Conservation and Recovery Act, the
Comprehensive Environmental Response, Compensation and Liability Act of
1980 ("CERCLA"), the Superfund Amendments and Reauthorization Act of
1986, the Federal Water Pollution Control Act, the Federal Clean Air
Act, the Toxic Substances Control Act or any United States, state or
local or any other statute, regulation, ordinance, order or decree
relating to health, safety or the environment.
ERISA. The Employee Retirement Income Security Act of 1974, as
amended from time to time.
ERISA AFFILIATE. Any Person which is treated as a single employer
with the Borrower under Section 414 of the Code.
ERISA REPORTABLE EVENT. A reportable event with respect to a
Guaranteed Pension Plan within the meaning of Section 4043 of ERISA and
the regulations promulgated thereunder.
EVENT(S) OF DEFAULT. See Section 10.
FEE LETTER. That certain fee letter dated as of the Closing Date
between the Agent and the Borrower.
FERC. The Federal Energy Regulatory Commission and its successors.
FERC LETTER. That certain letter dated December 17, 1997 from FERC
to Wright & Talisman (referencing Docket No. ER 98-463-000) pertaining
to, among other things, rate schedule designations, and as delivered to
the Agent prior to the Closing Date.
FERC NOTICE. That certain Notice of Issuance of Order dated
December 23, 1997 issued by FERC, in the form delivered to the Agent
prior to the Closing Date.
FERC ORDER. That certain Order Conditionally Accepting For Filing
Proposed Market-Based Rates dated December 23, 1997 issued by FERC, in
the form delivered to the Agent prior to the Closing Date.
FERC SUBSEQUENT ORDER. That certain Order Authorizing Transfer of
Jurisdiction Facilities dated December 30, 1997 issued by FERC, in the
form delivered to the Agent prior to the Closing Date.
GENERALLY ACCEPTED ACCOUNTING PRINCIPLES OR GAAP. (a) When used in
Section 5.4, whether directly or indirectly through reference to a
capitalized term used therein, means (i) principles that are consistent
with the principles promulgated or adopted by the Financial Accounting
Standards Board and its predecessors, in effect for the fiscal period
ended on the Balance Sheet Date, and (ii) to the extent consistent with
such principles, the accounting practice of the Borrower reflected in
the financial statements for the fiscal period ended on the Balance
Sheet Date, and (b) when used in general, other than as provided above,
means principles which are (i) consistent with the principles
promulgated or adopted by the Financial Accounting Standards Board and
its predecessors, in effect from time to time and (ii) consistently
applied with the past financial statements of the Borrower adopting the
same principles, provided that in each case referred to in this
definition of "GAAP", a certified public accountant would, insofar as
the use of accounting principles is pertinent, be in a position to
deliver an unqualified opinion (other than a qualification regarding
changes in GAAP) as to financial statements in which such principles
have been properly applied.
GUARANTEED PENSION PLAN. Any employee pension benefit plan with
the meaning of Section 3(2) of ERISA maintained or contributed to by the
Borrower or any ERISA Affiliate the benefits of which are guaranteed on
termination in full or in part by the Pension Benefit Guaranty
Corporation pursuant to Title IV of ERISA, other than a Multiemployer
Plan.
GUARANTY. The Guaranty, dated the Closing Date, made by Bangor in
favor of the Banks and the Agent pursuant to which Bangor guaranties to
the Banks and the Agent the payment and performance of the Obligations
and in form and substance satisfactory to the Agent.
HAZARDOUS SUBSTANCES. Any hazardous waste, as defined by 42 U.S.C.
Section 6903(5), any hazardous substances as defined by 42 U.S.C.
Section 9601(14), any pollutant or contaminant as defined by 42 U.S.C.
Section 9601(33) or any toxic substance, oil or hazardous materials or
other chemicals or substances regulated by any Environmental Laws.
INDEBTEDNESS. All obligations, contingent and otherwise, which in
accordance with GAAP should be classified upon the obligor's balance
sheet as liabilities, or to which reference should be made by footnotes
thereto, including, without limitation, in any event and whether or not
so classified: (a) all debt and similar monetary obligations, whether
direct or indirect; (b) all liabilities secured by any mortgage, pledge,
security interest, lien, charge, or other encumbrance existing on
property owned or acquired subject thereto, whether or not the liability
secured thereby shall have been assumed; and (c) all guarantees,
endorsements and other contingent obligations whether direct or indirect
in respect of indebtedness of others, including any obligation to supply
funds to or in any manner to invest in, directly or indirectly, the
debtor, to purchase indebtedness, or to assure the owner of indebtedness
against loss, through an agreement to purchase goods, supplies, or
services for the purpose of enabling the debtor to make payment of the
indebtedness held by such owner or otherwise, and the obligations to
reimburse the issuer of any letters of credit.
INELIGIBLE SECURITIES. Securities which may not be underwritten or
dealt in by member banks of the Federal Reserve System under Section 16
of the Banking Act of 1993 (12 U.S.C. Section 24, Seventh), as amended.
INTERCREDITOR AGREEMENT. The Intercreditor Agreement, dated or to
be dated on or prior to the Closing Date, among Chase and the Agent, and
in form and substance satisfactory to the Agent.
INTEREST PAYMENT DATE. (a) As to any Base Rate Loan, the last day
of the calendar month with respect to interest accrued during such
calendar month, including, without limitation, the calendar month which
includes the Drawdown Date of such Base Rate Loan; and (b) as to any
LIBOR Rate Loan in respect of which the Interest Period is (i) three (3)
months or less, the last day of such Interest Period and (ii) more than
three (3) months, the date that is three (3) months from the first day
of such Interest Period and, in addition, the last day of such Interest
Period.
INTEREST PERIOD. With respect to all or any relevant portion of
the Term Loan, (a) initially, the period commencing on the Drawdown Date
of such Term Loan and ending on the last day of one of the periods set
forth below, as selected by the Borrower as required by the terms of
this Credit Agreement (i) for any Base Rate Loan, the last day of the
calendar month; and (ii) for any LIBOR Rate Loan, 1, 2, 3 or 6 months;
and (b) thereafter, each period commencing on the last day of the next
preceding Interest Period applicable to or all or such portion of the
Term Loan and ending on the last day of one of the periods set forth
above, as selected by the Borrower in a Conversion Request; provided
that all of the foregoing provisions relating to Interest Periods are
subject to the following:
(a) if any Interest Period with respect to a LIBOR Rate Loan
would otherwise end on a day that is not a LIBOR Business Day, that
Interest Period shall be extended to the next succeeding LIBOR
Business Day unless the result of such extension would be to carry
such Interest Period into another calendar month, in which event
such Interest Period shall end on the immediately preceding LIBOR
Business Day;
(b) if any Interest Period with respect to a Base Rate Loan
would end on a day that is not a Business Day, that Interest Period
shall end on the next succeeding Business Day;
(c) if the Borrower shall fail to give notice as provided in
Section 2.7, the Borrower shall be deemed to have requested a
conversion of the affected LIBOR Rate Loan to a Base Rate Loan and
the continuance of all Base Rate Loans as Base Rate Loans on the
last day of the then current Interest Period with respect thereto;
(d) any Interest Period relating to any LIBOR Rate Loan that
begins on the last LIBOR 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 Interest Period) shall end on the
last LIBOR Business Day of a calendar month; and
(e) no Interest Period shall extend beyond the Term Loan
Maturity Date.
INVESTMENTS. All expenditures made and all liabilities incurred
(contingently or otherwise) for the acquisition of stock or Indebtedness
of, or for loans, advances, capital contributions or transfers of
property to, or in respect of any guaranties (or other obligations as
described under Indebtedness), or obligations of, any Person. In
determining the aggregate amount of Investments outstanding at any
particular time: (a) the amount of any Investment represented by a
guaranty shall be taken at not less than the principal amount of the
obligations guaranteed and still outstanding; (b) there shall be
included as an Investment all interest accrued with respect to
Indebtedness constituting an Investment unless and until such interest
is paid; (c) there shall be deducted in respect of each such Investment
any amount received as a return of capital (but only by repurchase,
redemption, retirement, repayment, liquidating dividend or liquidating
distribution); (d) there shall not be deducted in respect of any
Investment any amounts received as earnings on such Investment, whether
as dividends, interest or otherwise, except that accrued interest
included as provided in the foregoing clause (b) may be deducted when
paid; and (e) there shall not be deducted from the aggregate amount of
Investments any decrease in the value thereof.
LIBOR BUSINESS DAY. Any day on which commercial banks, are open
for international business (including dealings in Dollar deposits) in
London, England or such other eurodollar interbank market as may be
selected by the Agent in its sole discretion acting in good faith.
LIBOR LENDING OFFICE. Initially, the office of each Bank
designated as such in SCHEDULE 1 hereto; thereafter, and, after such
Bank has provided the Borrower and the Agent with written notice of a
change in the office, such other office of such Bank that shall be
making or maintaining LIBOR Rate Loans.
LIBOR RATE. For any Interest Period with respect to a LIBOR Rate
Loan, the rate of interest equal to (a) the rate determined by the
Agent at which Dollar deposits for such Interest Period are offered
based on information presented on Telerate Page 3750 as of 11:00 a.m.
London time on the second LIBOR Business Day prior to the first day of
such Interest Period, divided by (b) a number equal to 1.00 minus the
LIBOR Reserve Rate, if applicable.
LIBOR Rate Loans. All or any portion of the Term Loan bearing
interest calculated by reference to the LIBOR Rate.
LIBOR RESERVE RATE. For any day with respect to a LIBOR Rate Loan,
the maximum rate (expressed as a decimal) at which any lender subject
thereto would be required to maintain reserves under Regulation D of the
Board of Governors of the Federal Reserve System (or any successor or
similar regulations relating to such reserve requirements) against
"Eurocurrency Liabilities" (as that term is used in Regulation D), if
such liabilities were outstanding. The LIBOR Reserve Rate shall be
adjusted automatically on and as of the effective date of any change in
the LIBOR Reserve Rate.
LOAN DOCUMENTS. This Agreement, the Term Notes, the Intercreditor
Agreement, the Security Documents and the Fee Letter.
LOAN PERCENTAGE. With respect to each Bank, the percentage set
forth on Schedule 1 hereto as such Bank's percentage of the aggregate
outstanding amount of the Term Loan.
LOCKBOX AGREEMENT. The Lockbox Agreement dated as of the Closing
Date between the Borrower and the Agent and in form and substance
satisfactory to the Agent.
MAJORITY BANKS. As of any date, the Banks holding at least sixty-
six percent (66%) of the outstanding principal amount of the Term Loan
on such date.
MULTIEMPLOYER PLAN. Any multiemployer plan within the meaning of
Section 3(37) of ERISA maintained or contributed to by the Borrower or
any ERISA Affiliate.
NET WORTH. The excess of Total Assets over Total Liabilities.
NON-AFFECTED BANK. See Section 3.13(a).
OBLIGATIONS. All indebtedness, obligations and liabilities of
either of the Guarantor or the Borrower to any of the Banks and the
Agent, individually or collectively, existing on the date of this
Agreement or arising thereafter, direct or indirect, joint or several,
absolute or contingent, matured or unmatured, liquidated or
unliquidated, secured or unsecured, arising by contract, operation of
law or otherwise, in each case arising or incurred under this Agreement
or any of the other Loan Documents or in respect of the Term Loan made
or any of the Term Notes or arising or incurred in connection with any
interest rate protection arrangements provided by the Banks pursuant to
Section 6.17, or any documents, agreements or instruments executed in
connection therewith, or other instruments at any time evidencing any
thereof.
OPERATING ACCOUNT. See Section 6.16.
OUTSTANDING. With respect to the Term Loan, the aggregate unpaid
principal thereof as of any date of determination.
PENSION BENEFIT GUARANTY CORPORATION (or "PBGC"). The Pension
Benefit Guaranty Corporation created by Section 4002 of ERISA or any
successor entity or entities having similar responsibilities.
PERFECTION CERTIFICATE. The Perfection Certificate as defined in
the Security Agreement.
PERMITTED LIENS. See Section 7.2.
PERSON. Any individual, corporation, partnership, trust,
unincorporated association, business, or other legal entity, and any
government or any governmental agency or political subdivision thereof.
RATE SCHEDULE AGREEMENT. That certain agreement dated October 30,
1997 by and between Bangor and the Borrower pursuant to which Bangor has
agreed to provide energy to the Borrower in connection with the
servicing of the Unitil Contract, and in the form delivered to the Agent
on the Closing Date.
REAL ESTATE. All real property at any time owned or leased (as
lessee or sublessee) by the Borrower.
REGISTER. See Section 16.3.
RELEASE. Shall have the meaning specified in the Comprehensive
Environmental Response, Compensation and Liability Act of 1980,
42 U.S.C. Section Section 9601 ET SEQ. ("CERCLA") and the term
"Disposal" (or "Disposed") shall have the meaning specified in the
Resource Conservation and Recovery Act of 1976, 42 U.S.C. Section
Section 6901 Et Seq. ("RCRA") and regulations promulgated thereunder;
provided, that in the event that either CERCLA or RCRA is amended so as
to broaden the meaning of any term defined thereby, such broader meaning
shall apply as of the effective date of such amendment and provided
further, that to the extent that the laws of the State of Maine
establish a meaning for "Release" or "Disposal" which is broader than
specified in either CERCLA or RCRA, such broader meaning shall apply.
SECTION 20 SUBSIDIARY. A Subsidiary of the bank holding company
controlling any Bank, which Subsidiary has been granted authority by the
Federal Reserve Board to underwrite and deal in certain Ineligible
Securities.
SECURITY AGREEMENT. The Security Agreement, dated the Closing
Date, between the Borrower and the Agent and in the form of EXHIBIT B.
SECURITY DOCUMENTS. The Guaranty, the Security Agreement, the
Collateral Assignment, the Lockbox Agreement, the Cash Collateral
Agreement and all other instruments and documents, including without
limitation Uniform Commercial Code financing statements, required to be
executed or delivered pursuant to any Security Document.
SERVICE AGREEMENT. The Service Agreement dated on or prior to the
Closing Date between Bangor and the Borrower and in form and substance
satisfactory to the Agent.
SUBSIDIARY. Any corporation, association, trust, or other business
entity of which the designated parent shall at any time own directly or
indirectly through a Subsidiary or Subsidiaries at least a majority (by
number of votes) of the outstanding Voting Stock.
SYSTEM POWER. As such term is defined in the Article 3, paragraph
4 of the Second Amendment to Power Sales Agreement dated March 1, 1995
to the Unitil Contract.
TERM LOAN. The term loan made or to be made by the Agent to the
Borrower on the Closing Date in the aggregate principal amount of
$24,800,000 pursuant to Section 2.1.
TERM LOAN MATURITY DATE. The date which is the earlier to occur of
(a) July 31, 2002 and (b) the termination for whatever reason of the
Unitil Contract.
TERM NOTE. See Section 2.2.
TERM NOTE RECORD. The grid attached to a Term Note, or the
continuation of such grid, or any other similar record, including
computer records, maintained by any Bank with respect to the Term Loan
referred to in such Term Note.
TOTAL ASSETS. All assets of the Borrower determined in accordance
with GAAP.
TOTAL DEBT SERVICE. For any period with respect to the Borrower,
all scheduled mandatory payments of principal on Indebtedness of the
Borrower made or required to be made in that period pursuant to any
agreement to which the Borrower is a party relating to the borrowing of
money or the obtaining of credit or in respect of Capitalized Leases,
PLUS the aggregate amount of interest expense in respect of all
Indebtedness of the Borrower for such period pursuant to any agreement
to which the Borrower is a party relating to the borrowing of money or
the obtaining of credit or in respect of Capitalized Leases, determined
in accordance with GAAP (including without limitation all non-cash
interest payments, the interest portion of any deferred payment
obligation and the interest component of Capitalized Leases).
TOTAL LIABILITIES. All liabilities of the Borrower determined in
accordance with GAAP and classified as such on the balance sheet of the
Borrower.
TYPE. As to all or any portion of the Term Loan, its nature as a
Base Rate Loan or a LIBOR Rate Loan.
UNFUNDED VESTED LIABILITIES. With respect to any Employee Benefit
Plan, the amount (if any) by which (a) the present value of all vested
nonforfeitable benefits under such Employee Benefit Plan exceeds (b) the
fair market value of all Employee Benefit Plan assets allocable to such
benefits, all determined as of the then most recent valuation date of
such Employee Benefit Plan, but only to the extent that such excess
represents a potential liability of the Borrower to the Pension Benefit
Guaranty Corporation or the Employee Benefit Plan under Title IV of
ERISA.
UNITIL. Unitil Power Corp., a New Hampshire corporation.
UNITIL CERTIFICATE. The estoppel certificate from Unitil to the
Agent dated on or prior to the Closing Date, and in form and substance
satisfactory to the Agent.
UNITIL CONTRACT. The Power Sales Agreement between Unitil and
Bangor, dated March 26, 1986 and amended by the Amendment to March 26,
1986 Power Sales Agreement dated April 29, 1993 and the Second Amendment
to Power Sales Agreement dated March 1, 1995, which Unitil Contract has
been assigned by Bangor to the Borrower on or prior to the Closing Date
pursuant to the Unitil Contract Assignment.
UNITIL CONTRACT ASSIGNMENT. The Assignment and Assumption
Agreement between Bangor and the Borrower, dated the Closing Date,
pursuant to which Bangor assigns all of its right, title and obligations
under the Unitil Contract to the Borrower.
VOTING STOCK. Stock or similar interests, of any class or classes
(however designated), the holders of which are at the time entitled, as
such holders, to vote for the election of a majority of the directors
(or persons performing similar functions) of the corporation,
association, trust or other business entity involved, whether or not the
right so to vote exists by reason of the happening of a contingency.
WORKING CAPITAL RESERVE. Cash or cash equivalents of the type
described in the Cash Collateral Agreement in an aggregate amount of not
less than $1,500,000 which the Borrower is required to maintain with the
Agent pursuant to the Cash Collateral Agreement.
Section 1.2. Rules of Interpretation.
(a) A reference to any document or agreement shall include such
document or agreement as amended, modified or supplemented from time to
time in accordance with its terms and the terms of this Agreement.
(b) The singular includes the plural and the plural includes the
singular.
(c) A reference to any law includes any amendment or modification
to such law.
(d) A reference to any Person includes its permitted successors
and permitted assigns.
(e) Accounting terms capitalized but not otherwise defined herein
have the meanings assigned to them by GAAP applied on a consistent basis
by the accounting entity to which they refer.
(f) The words "include", "includes" and "including" are not
limiting.
(g) All terms not specifically defined herein or by GAAP, which
terms are defined in the Uniform Commercial Code as in effect in the
State of New York, have the meanings assigned to them therein, with the
term "instrument" being that defined under Article 9 of the Uniform
Commercial Code.
(h) Reference to a particular "Section " refers to that section of
this Agreement unless otherwise indicated.
(i) The words "herein", "hereof", "hereunder" and words of like
import shall refer to this Agreement as a whole and not to any
particular section or subdivision of this Agreement.
(j) Unless otherwise expressly indicated, in the computation of
periods of time from a specified date to a later specified date, the
word "from" means "from and including," the words "to" and "until" each
mean "to but excluding," and the word "through" means "to and
including."
(k) This Agreement and the other Loan Documents may use several
different limitations, tests or measurements to regulate the same or
similar matters. All such limitations, tests and measurements are,
however, cumulative and are to be performed in accordance with the terms
thereof.
(l) This Agreement and the other Loan Documents are the result of
negotiation among, and have been reviewed by counsel to, among others,
the Agent and the Borrower and are the product of discussions and
negotiations among all parties. Accordingly, this Agreement and the
other Loan Documents are not intended to be construed against the Agent
or any of the Banks merely on account of the Agent's or any Bank's
involvement in the preparation of such documents.
Section 2. THE TERM LOAN.
Section 2.1. COMMITMENT TO LEND.
Subject to the terms and conditions set forth in this Agreement, each
Bank agrees to lend to the Borrower on the Closing Date the amount of its
Loan Percentage of the principal amount of $24,800,000.
Section 2.2. THE TERM NOTES.
The Term Loan shall be evidenced by separate promissory notes of the
Borrower in substantially the form of EXHIBIT C hereto (each a "Term Note"),
dated the Closing Date or the effective date of any future assignment made
pursuant to Section 16 hereof and completed with appropriate insertions. One
Term Note shall be payable to the order of each Bank in a principal amount
equal to such Bank's Loan Percentage of the Term Loan and representing the
obligation of the Borrower to pay to such Bank such principal amount or, if
less, the outstanding amount of such Bank's Loan Percentage of the Term Loan,
plus interest accrued thereon, as set forth below. The Borrower irrevocably
authorizes each Bank to make or cause to be made a notation on such Bank's
Term Note Record reflecting the original principal amount of such Bank's Loan
Percentage of the Term Loan and, at or about the time of such Bank's receipt
of any principal payment on such Bank's Term Note, an appropriate notation on
such Bank's Term Note Record reflecting such payment. The aggregate unpaid
amount set forth on such Bank's Term Note Record shall, absent manifest
error, be prima facie evidence of the principal amount thereof owing and
unpaid to such Bank, but the failure to record, or any error in so recording,
any such amount on such Bank's Term Note Record shall not affect the
obligations of the Borrower hereunder or under any Term Note to make payments
of principal of and interest on any Term Note when due.
Section 2.3. MANDATORY PAYMENTS OF PRINCIPAL OF TERM LOAN.
The Borrower promises to pay to the Agent for the account of the Banks
the principal amount of the Term Loan in fifty-three (53) consecutive monthly
payments, payable no later than the fifteenth (15th) day following such
calendar month, in the amount set forth opposite such period, commencing on
the fifteenth (15th) day of the calendar month occurring immediately
following the Closing Date, with a final payment on the Term Loan Maturity
Date in an amount equal to the unpaid balance of the Term Loan plus accrued
interest.
CALENDAR MONTH ENDING AMOUNT OF EACH PAYMENT
June, 1998 $375,000
July, 1998 $470,000
August, 1998 $460,000
September, 1998 $470,000
October, 1998 - December, 1998 $375,000
January, 1999 - March, 1999 $385,000
April, 1999 - June, 1999 $380,000
July, 1999 - September, 1999 $400,000
October, 1999 - December, 1999 $415,000
January, 2000 - March, 2000 $430,000
April, 2000 - June, 2000 $445,000
July, 2000 - September, 2000 $470,000
October, 2000 - December, 2000 $475,000
January, 2001 - March, 2001 $500,000
April, 2001 - June, 2001 $505,000
July, 2001 - September, 2001 $535,000
October, 2001 - December, 2001 $540,000
January, 2002 - March, 2002 $625,000
April, 2002, - June, 2002 $700,000
July, 2002 $1,485,000
Section 2.4. OPTIONAL PREPAYMENT OF TERM LOAN.
The Borrower shall have the right at any time to prepay the Term Notes
on or before the Term Loan Maturity Date, as a whole, or in part, upon not
less than three (3) Business Days prior written notice to the Agent, without
premium or penalty (but subject to Section 3.6), provided that (a) each
partial prepayment shall be in the principal amount of $500,000 or an
integral multiple thereof, and (b) each partial prepayment shall be allocated
among the Banks, in proportion, as nearly as practicable, to the respective
outstanding amount of each Bank's Term Note, with adjustments to the extent
practicable to equalize any prior prepayments not exactly in proportion. Any
prepayment of principal of the Term Loan shall include all interest accrued
to the date of prepayment and shall be applied against the scheduled
installments of principal due on the Term Loan in the inverse order of
maturity. No amount repaid with respect to the Term Loan may be reborrowed.
Section 2.5. INTEREST ON TERM LOAN.
Except as otherwise provided in Section 3.12 the Term Loan shall bear
interest during each Interest Period relating to all or any portion of the
Term Loan at the following rates:
(a) To the extent that all or any portion of the Term Loan bears
interest during such Interest Period at the Base Rate, the Term Loan or
such portion shall bear interest during such Interest Period at the Base
Rate.
(b) To the extent that all or any portion of the Term Loan bears
interest during such Interest Period at the LIBOR Rate, the Term Loan or
such portion shall bear interest during such Interest Period at the rate
of one and one-eighth percent (1.125%) per annum above the LIBOR Rate
determined for such Interest Period.
(c) The Borrower promises to pay interest on the Term Loan or any
portion thereof outstanding during each Interest Period on each Interest
Payment Date applicable to such Interest Period.
Section 2.6. NOTIFICATION BY BORROWER.
The Borrower shall notify the Agent, such notice to be irrevocable at
least three (3) LIBOR Business Days prior to the Drawdown Date of the Term
Loan if all or any portion of the Term Loan is to bear interest at the LIBOR
Rate.
Section 2.7. CONVERSION OPTIONS.
(a) CONVERSION TO DIFFERENT TYPE OF TERM LOAN. The Borrower may
elect from time to time to convert all or any portion of the outstanding
Term Loan to another Type, PROVIDED that (a) with respect to any such
conversion of all or any portion of the Term Loan to a Base Rate Loan,
the Borrower shall give the Agent at least two (2) Business Days prior
written notice of such election; (b) with respect to any such conversion
of a Base Rate Loan to a LIBOR Rate Loan, the Borrower shall give the
Agent at least three (3) LIBOR Business Days prior written notice of
such election; (c) with respect to any such conversion of a LIBOR Rate
Loan into another Type, such conversion shall only be made on the last
day of the Interest Period with respect thereto and (d) no portion of
the Term Loan may be converted into a LIBOR Rate Loan when any Default
or Event of Default has occurred and is continuing. On the date on
which such conversion is being made each Bank shall take such action as
is necessary to transfer its Loan Percentage of the relevant portion of
the Term Loan being converted to its Domestic Lending Office or its
LIBOR Lending Office, as the case may be. All or any part of the
outstanding Term Loan of any Type may be converted into another Type as
provided herein, PROVIDED that any partial conversion shall be in an
aggregate principal amount of $1,000,000 or a whole multiple of $500,000
in excess thereof. Each Conversion Request relating to the conversion
of all or any portion of the Term Loan to a LIBOR Rate Loan shall be
irrevocable by the Borrower.
(b) CONTINUATION OF TYPE OF LOAN. All or any portion of the Term
Loan of any Type may be continued as such of the same Type upon the
expiration of an Interest Period with respect thereto by compliance by
the Borrower with the notice provisions contained in Section 2.7(a);
PROVIDED that no LIBOR Rate Loan may be continued as such when any Event
of Default has occurred and is continuing, but shall be automatically
converted to a Base Rate Loan on the last day of the Interest Period
relating thereto ending during the continuance of any Event of Default
of which officers of the Agent active upon the Borrower's account have
actual knowledge. In the event that the Borrower fails to provide any
such notice with respect to the continuation of any LIBOR Rate Loan as
such, then such LIBOR Rate Loan shall be automatically converted to a
Base Rate Loan on the last day of such Interest Period. The Agent shall
notify the Banks promptly when any such automatic conversion
contemplated by this Section 2.7 is scheduled to occur.
(c) LIBOR RATE LOANS. Any conversion to or from LIBOR Rate Loans
shall be in such amounts and be made pursuant to such elections so that,
after giving effect thereto, the aggregate principal amount of all LIBOR
Rate Loans having the same Interest Period shall not be less than
$1,000,000 or a whole multiple of $500,000 in excess thereof.
Section 3. CERTAIN GENERAL PROVISIONS.
Section 3.1. FEES.
The Borrower agrees to pay to the Agent for its own account all fees at
the times and in the amounts provided in the Fee Letter.
Section 3.2. PAYMENTS.
All payments of principal, interest, fees, and any other amounts due
hereunder or any of the other Loan Documents shall be made by the Borrower to
the Agent, for the respective accounts of the Banks and the Agent, at the
Agent's Head Office or at such other location in the Boston, Massachusetts
area that the Agent may from time to time designate, in each case in
immediately available funds.
Section 3.3. NO OFFSET, ETC.
All payments by the Borrower hereunder and under any of the other Loan
Documents shall be made without setoff or counterclaim and free and clear of
and without deduction for any income, stamp or other taxes, levies, imposts,
duties, charges, fees, deductions, withholdings, now or hereinafter imposed,
levied or collected, withheld or assessed by any governmental authority,
agency or instrumentality excluding, in the case of the Agent and each Bank,
net income and franchise taxes imposed on the Agent or such Bank by the
jurisdiction under the laws of which such Agent or such Bank is organized or
any political subdivision thereof or taxing or other authority therein unless
the Borrower is compelled by law to make such deduction or withholding. If
any such obligation is imposed upon the Borrower with respect to any amount
payable by it hereunder or under any of the other Loan Documents, the
Borrower will pay to the Agent, for the account of the Banks or (as the case
may be) the Agent, on the date on which such amount is due and payable
hereunder or under such other Loan Document, such additional amount in
Dollars as shall be necessary to enable the Banks or the Agent to receive the
same net amount which the Banks or the Agent would have received on such date
had no such obligation been imposed upon the Borrower. The Borrower will
deliver promptly to the Agent certificates or other valid vouchers for all
taxes or other charges deducted from or paid with respect to payments made by
the Borrower hereunder or under such other Loan Document.
Section 3.4. COMPUTATIONS.
All computations of interest on any LIBOR Rate Loan and of fees shall be
calculated on the basis of 360-day year for the actual days elapsed, and all
computations of interest on any Base Rate Loan shall be calculated on the
basis of a 365- (or 366-, as the case may be) day year for the actual days
elapsed. Except as otherwise provided in the definition of "Interest Period"
with respect to LIBOR Rate Loans, whenever a payment hereunder or under the
any of the Loan Documents becomes due on a day which is not a Business Day,
the due date for such payment shall be extended to the next succeeding
Business Day, and interest shall accrue during such extension.
Section 3.5. INTEREST LIMITATION.
Notwithstanding any other term of this Agreement or any Loan Document or
any other document referred to herein or therein, the maximum amount of
interest which may be charged to or collected from any Person liable
hereunder or under the Term Note by any Bank shall be absolutely limited to,
and shall in no event exceed, the maximum amount of interest which could
lawfully be charged or collected under applicable law (including, to the
extent applicable, the provisions of Section 5197 of the Revised Statutes of
the United States of America, as amended, 12 U.S.C. Section 85, as amended),
so that the maximum of all amounts constituting interest under applicable
law, howsoever computed, shall never exceed as to any Person liable therefor
such lawful maximum, and any term of this Agreement, any Term Note, or any
other document referred to herein or therein which could be construed as
providing for interest in excess of such lawful maximum shall be and hereby
is made expressly subject to and modified by the provisions of this
paragraph.
Section 3.6. INDEMNITY.
The Borrower agrees to indemnify each Bank and to hold each Bank
harmless from and against any loss, cost or expenses (including, such loss or
expense associated with terminating any interest rate protection arrangements
entered into between the Borrower and any Bank) that such Bank may sustain or
incur as a consequence of (a) default by the Borrower in payment of the
principal amount of or any interest on any LIBOR Rate Loans as and when due
and payable, including any such loss or expense arising from interest or fees
payable by such Bank to lenders of funds obtained by it in order to maintain
its LIBOR Rate Loans, (b) default by the Borrower in making a borrowing or a
conversion after the Borrower has given (or is deemed to have given) notice
pursuant to Section 2.6 or a Conversion Request relating thereto in
accordance with Section 2.7 (other than as a result of the operation of
Section 3.7) or (c) the making of any payment of a LIBOR Rate Loan or the
making of any conversion of any such LIBOR Rate Loan to a Base Rate Loan on a
day that is not the last day of the applicable Interest Period with respect
thereto, including interest or fees payable by such Bank to lenders of funds
obtained by it in order to maintain any such LIBOR Rate Loans. Such loss or
reasonable expense shall exclude any loss of profits or margin applicable to
such LIBOR Rate Loan but shall include an amount equal to the excess, if any,
as reasonably determined by each Bank of (i) its cost of obtaining the funds
for the LIBOR Rate Loan being paid, prepaid, converted, not converted, or not
borrowed, as the case may be (based on the LIBOR Rate) for the period from
the date of such payment, prepayment, conversion, or failure to borrow or
convert, as the case may be, to the last day of the Interest Period for such
portion of the Term Loan (or, in the case of a failure to borrow, the
Interest Period for such portion of the Term Loan which would have commenced
on the date of such failure to borrow) over (ii) the amount of interest (as
reasonably determined by such Bank) that would be realized by such Bank in re-
employing the funds so paid, prepaid, converted, or not borrowed, converted,
or prepaid for such period or Interest Period, as the case may be, which
determinations shall be prima facie correct and binding, absent manifest
error.
Section 3.7. INABILITY TO DETERMINE LIBOR RATE.
In the event, prior to the commencement of any Interest Period relating
to any LIBOR Rate Loan, the Agent shall determine or be notified by the
Majority Banks that adequate and reasonable methods do not exist for
ascertaining the LIBOR Rate that would otherwise determine the rate of
interest to be applicable to any LIBOR Rate Loan during any Interest Period,
the Agent shall forthwith give notice of such determination (which shall be
conclusive and binding on the Borrower and the Banks) to the Borrower and the
Banks. In such event (a) any Conversion Request with respect to LIBOR Rate
Loans shall be automatically withdrawn and shall be deemed a request for Base
Rate Loans, (b) each LIBOR Rate Loan will automatically, on the last day of
the then current Interest Period relating thereto, become a Base Rate Loan,
and (c) the obligations of the Banks to make LIBOR Rate Loans shall be
suspended until the Agent or the Majority Banks determines that the
circumstances giving rise to such suspension no longer exist, whereupon the
Agent or, as the case may be, the Agent upon the instruction of the Majority
Banks, shall so notify the Borrower and the Banks.
Section 3.8. ILLEGALITY.
Notwithstanding any other provisions herein, if subsequent to the
Closing Date, the adoption of or change in any present or future law,
regulation, treaty or directive or in the interpretation or application
thereof shall make it unlawful for any Bank to make or maintain LIBOR Rate
Loans, such Bank shall forthwith give notice of such circumstances to the
Borrower and the other Banks and thereupon (a) the commitment of such Bank to
make LIBOR Rate Loans or convert Base Rate Loans to LIBOR Rate Loans shall
forthwith be suspended and (b) such Bank's Term Loan then outstanding as
LIBOR Rate Loans, if any, shall be converted automatically to Base Rate Loans
on the last day of each Interest Period applicable to such LIBOR Rate Loans
or within such earlier period as may be required by law. The Borrower hereby
agrees promptly to pay the Agent for the account of such Bank, upon demand by
such Bank, any additional amounts as may be required pursuant to Section 3.6.
Section 3.9. ADDITIONAL COSTS, ETC.
If subsequent to the Closing Date, the adoption of or change in any
present or future applicable law, which expression, as used herein, includes
statutes, rules and regulations thereunder and interpretations thereof by any
competent court or by any governmental or other regulatory body or official
charged with the administration or the interpretation thereof and requests,
directives, instructions and notices at any time or from time to time
hereafter made upon or otherwise issued to any Bank or the Agent by any
central bank or other fiscal, monetary or other authority (whether or not
having the force of law), shall:
(a) subject any Bank or the Agent to any tax, levy, impost, duty,
charge, fee, deduction or withholding of any nature with respect to this
Agreement, the other Loan Documents, such Bank's Term Note (other than
taxes based upon or measured by the income or profits of such Bank or
the Agent), or
(b) materially change the basis of taxation (except for changes in
taxes on income or profits) of payments to any Bank of the principal of
or the interest on its Term Note or any other amounts payable to any
Bank or the Agent under this Agreement or any of the other Loan
Documents, or
(c) impose or increase or render applicable (other than to the
extent specifically provided for elsewhere in this Agreement) any
special deposit, reserve, assessment, liquidity, capital adequacy or
other similar requirements (whether or not having the force of law)
against assets held by, or deposits in or for the account of, or loans
by an office of any Bank, or
(d) impose on any Bank or the Agent any other conditions or
requirements with respect to this Agreement, the other Loan Documents,
or such Bank's Term Note and the result of any of the foregoing is
(i) to increase the cost to any Bank of making, funding,
extending or maintaining such Bank's Term Note, or
(ii) to reduce the amount of principal, interest, or other
amount payable to such Bank or the Agent hereunder on account of
such Bank's Term Note, or
(iii) to require such Bank or the Agent to make any
payment or to forego any interest or other sum payable hereunder,
the amount of which payment or foregone interest or other sum is
calculated by reference to the gross amount of any sum receivable
or deemed received by such Bank or the Agent from the Borrower
hereunder,
then, and in each such case, the Borrower will, upon demand made by such Bank
or (as the case may be) the Agent at any time and from time to time and as
often as the occasion therefor may arise, pay to such Bank or the Agent such
additional amounts as will be sufficient to compensate such Bank or the Agent
for such additional cost, reduction, payment or foregone interest or other
sum.
Section 3.10. CAPITAL ADEQUACY.
If after the date hereof any Bank determines that (a) the adoption of or
change in any law, governmental rule, regulation, policy, guideline or
directive (whether or not having the force of law) regarding capital
requirements for banks or bank holding companies or any change in the
interpretation or application thereof by a court or governmental authority
with appropriate jurisdiction, in each case made subsequent to the Closing
Date, or (b) compliance by such Bank or any corporation controlling such Bank
with any such adoption of, or change in, law, governmental rule, regulation,
policy, guideline or directive (whether or not having the force of law) of
any such entity regarding capital adequacy, has the effect of reducing the
return on such Bank's Term Note to a level below that which such Bank could
have achieved but for such adoption, change or compliance (taking into
consideration such Bank's then existing policies with respect to capital
adequacy and assuming full utilization of such entity's capital) by any
amount deemed by such Bank to be material, then such Bank may notify the
Borrower of such fact. To the extent that the amount of such reduction in
the return on capital is not reflected in the Base Rate, the Borrower and
such Bank shall thereafter attempt to negotiate in good faith, within thirty
(30) days of the day on which the Borrower receives such notice, an
adjustment payable hereunder that will adequately compensate such Bank in
light of these circumstances. If the Borrower and such Bank are unable to
agree to such adjustment within thirty (30) days of the date on which the
Borrower receives such notice, then commencing on the date of such notice
(but not earlier than the effective date of any such increased capital
requirement), the fees payable hereunder shall increase by an amount that
will, in such Bank's reasonable determination, provide adequate compensation.
Each Bank shall allocate such cost increases among its customers in good
faith and on an equitable basis.
Section 3.11. CERTIFICATE.
Each Bank shall notify the Borrower of any event entitling such Bank to
compensation under Section 3.9 or 3.10 as promptly as practicable, but in any
event within 60 days, after such Bank obtains actual knowledge thereof;
provided that (i) if any Bank fails to give such notice within 60 days after
it obtains actual knowledge of such an event, such Bank shall, with respect
to compensation payable pursuant to Section 3.9 or 3.10 in respect of any
costs resulting form such event, only be entitled to payment under such
Section 3.9 or 3.10, as applicable, for costs incurred from and after the
date 60 days prior to the date that such Bank does give such notice and
(ii) each Bank will designate a different lending office for the Term Loan of
such Bank if such designation will avoid the need for, or reduce the amount
of, such compensation and will not, in the sole opinion of such Bank, be
disadvantageous to such Bank. A certificate setting forth any additional
amounts payable pursuant to Section Section 3.9 or 3.10 and a brief
explanation of such amounts which are due, submitted by any Bank or the Agent
to the Borrower, shall be conclusive, absent manifest error, that such
amounts are due and owing.
Section 3.12. OVERDUE INTEREST.
Each overdue amount of principal, interest or fees hereunder or under
the Term Note shall, following the expiration of the applicable grace period,
if any, to the extent permitted by law, bear interest at a rate per annum
which shall at all times be two percentage points (2%) above the Base Rate
and payable on demand, to accrue from the due date thereof until the
obligation of the Borrower with respect to the payment thereof shall be
discharged, whether before or after judgment.
Section 3.13. REPLACEMENT BANKS; MITIGATION.
(a) Within thirty (30) days after (i) any Bank has demanded
compensation from the Borrower pursuant to Section Section 3.3, 3.9 or
3.10 hereof, or (ii) there shall have occurred a change in law with
respect to any Bank as a consequence of which it shall become unlawful
for such Bank to make a LIBOR Rate Loan on any Drawdown Date, as
described in the previous Section 3.8 (any such Bank described in the
foregoing clauses (i) or (ii) is hereinafter defined as an "Affected
Bank"), the Borrower may request that the other Banks (the "Non-Affected
Banks") acquire all, but not less than all, of the Affected Bank's Term
Note and assume all, but not less than all, of the Affected Bank's Term
Note. If the Borrower so requests, the Non-Affected Banks may elect to
acquire all of the Affected Bank's Term Note and assume all of the
Affected Bank's Term Note. If the Non-Affected Banks do not elect to
acquire and assume all of the Affected Bank's Term Note, the Borrower
may designate a replacement bank or banks (which must be an Eligible
Assignee), which must be reasonably satisfactory to the Agent, to
acquire and assume that portion of the Term Note of the Affected Bank
not being acquired and assumed by the Non-Affected Banks. The
provisions of Section 16 hereof shall apply to all reallocations
pursuant to this Section 3.13, and the Affected Bank and the Non-
Affected Banks and/or replacement banks which are to acquire the Term
Note of the Affected Bank shall execute and deliver to the Agent, in
accordance with the provisions of Section 16 hereof, such Assignments
and Acceptances and other instruments, as are required pursuant to
Section 16 hereof to give effect to such reallocations; provided,
however, the Borrower shall, or shall cause the assignee Bank to pay,
the registration fee set forth in Section 16.3. On the effective date
of the applicable Assignment and Acceptances, the Borrower shall pay to
the Affected Bank all interest accrued on its Term Note up to but
excluding such date, along with any fees payable to such Affected Bank
hereunder up to but excluding such date, including, without limitation,
any amounts that would have been payable pursuant to Section 3.6 hereof
in connection with prepayment.
(b) If (i) any Bank shall request compensation under Section 3.9
or Section 3.10 hereof, (ii) any Bank deliver a notice described in
Section 3.8 hereof or (iii) the Borrower is required to pay any
additional amount to any Bank or any governmental authority on account
of the Bank pursuant to Section 3.3 or Section 3.9, such Bank agrees to
use reasonable efforts (consistent with legal policy and regulatory
restrictions) to change its Domestic Lending Office or LIBOR Lending
Office, as the case may be, to avoid or minimize any amounts otherwise
payable under Section Section 3.3, 3.9 or 3.10 or enable it to withdraw
a notice given pursuant to Section 3.8, in each case solely if such
change can be made in a manner so that such Bank, in its sole
determination, suffers no legal, economic or regulatory disadvantage
deemed by such Bank in its sole discretion to be significant..
Section 4. SECURITY AND GUARANTY.
Section 4.1. SECURITY OF BORROWER.
The Obligations shall be secured by a perfected first priority security
interest (subject only to Permitted Liens entitled to priority under
applicable law) in all of the assets of the Borrower, whether now owned or
hereafter acquired, pursuant to the terms of the Security Documents to which
the Borrower is a party.
Section 4.2. GUARANTY.
The Obligations shall also be guaranteed pursuant to the terms of the
Guaranty.
Section 5. REPRESENTATIONS AND WARRANTIES.
The Borrower represents and warrants to each of the Banks and the Agent
on the Closing Date as follows:
Section 5.1. CORPORATE AUTHORITY.
(a) INCORPORATION; GOOD STANDING. The Borrower (i) is a
corporation duly organized, validly existing and in good standing under
the laws of the State of Maine, (ii) has all requisite corporate power
to own its property and conduct its business as now conducted and as
presently contemplated, and (iii) is in good standing as a foreign
corporation and is duly authorized to do business in each jurisdiction
in which its property or business as presently conducted or contemplated
makes such qualification necessary except where a failure to be so
qualified would not have a material adverse effect on the business,
assets or financial condition of the Borrower.
(b) AUTHORIZATION. The execution, delivery and performance of
this Agreement and the other Loan Documents to which the Borrower is or
is to become a party and the transactions contemplated hereby and
thereby (i) are within the corporate authority of the Borrower,
(ii) have been duly authorized by all necessary corporate proceedings,
(iii) do not conflict with or result in any material breach or
contravention of any provision of law, statute, rule or regulation to
which the Borrower is subject or any judgment, order, writ, injunction,
license or permit applicable to the Borrower, and (iv) do not conflict
with any provision of the corporate charter or bylaws of, or any
agreement or other instrument binding upon the Borrower.
(c) ENFORCEABILITY. The execution, delivery and performance of
this Agreement and the Loan Documents to which the Borrower is or is to
become a party will result in valid and legally binding obligations of
the Borrower enforceable against it in accordance with the respective
terms and provisions hereof and thereof, except as limited by
bankruptcy, insolvency, reorganization, moratorium or other laws
relating to creditors' rights and except to the extent that availability
of the remedy of specific performance or injunctive relief is subject to
the discretion of the court before which any proceeding therefor may be
brought.
Section 5.2. PERMITS AND GOVERNMENTAL AUTHORITY.
Except for the approvals identified in SCHEDULE 5.2, (which approvals
either have been obtained or cannot be obtained prior to the Closing Date in
each case as noted on such schedule), no action by, and no notice to or
filing with, any federal, state or local governmental authority or regulatory
body is or will be required for the due execution, delivery and performance
by Bangor or the Borrower of this Agreement or the Loan Documents or any of
the transactions contemplated herein or therein. Bangor and the Borrower
shall take all necessary action to maintain and keep in effect all of the
approvals identified in SCHEDULE 5.2.
Section 5.3. TITLE TO PROPERTIES; LEASES.
The Borrower owns all of the assets reflected in the pro forma balance
sheet of the Borrower as of the Closing Date or acquired since that date
(except property and assets sold or otherwise disposed of in the ordinary
course of business since that date), subject to no rights of others,
including any mortgages, leases, conditional sales agreements, title
retention agreements, liens or other encumbrances except Permitted Liens.
Section 5.4. FINANCIAL STATEMENTS PROJECTIONS; SOLVENCY.
(a) The Borrower has a fiscal year which is the twelve (12) months
ending on December 31 of each calendar year.
(b) There has been furnished to the Agent a pro forma balance
sheet of the Borrower as at the Closing Date, and a pro forma statement
of income and operations as of the Closing Date. Such balance sheet and
statement of income and operations have been prepared in accordance with
GAAP and fairly present in all material respects the financial condition
of the Borrower as at the close of business on the date thereof and the
results of operations for the period then ended. There are no
contingent liabilities of the Borrower as of such date involving
material amounts, known to the officers of the Borrower, which were not
disclosed in such balance sheets and the notes related thereto.
(c) The Borrower (both before and after giving effect to the
transactions contemplated by this Agreement) is solvent, has assets
having a fair value in excess of the amount required to pay its probable
liabilities on its existing debts as they become absolute and matured,
and has and will have, access to adequate capital for the conduct of its
business and the ability to pay its debts from time to time incurred in
connection therewith as such debts mature.
(d) The projections of the annual operating budget of the
Borrower, balance sheets and cash flow statements for the 1998 to 2003
fiscal years, copies of which have been delivered to the Agent, disclose
all material assumptions made with respect to general economic,
financial and market conditions used in formulating such projections.
To the knowledge of the Borrower, no facts exist that, individually or
in the aggregate, would result in any material change in any of such
projections. The projections are based upon reasonable estimates and
assumptions, have been prepared on the basis of the assumptions stated
therein and reflect the reasonable estimates of the Borrower of the
results of operations and other information projected therein.
Notwithstanding the foregoing, the Agent and the Banks recognize that
such projections as to future events are not to be viewed as facts and
that actual results during the period covered may differ from the
projected results.
Section 5.5. NO MATERIAL CHANGES, ETC.
[Intentionally Deleted]
Section 5.6. FRANCHISES, PATENTS, COPYRIGHTS, ETC.
The Borrower possesses all franchises, patents, copyrights, trademarks,
trade names, licenses and permits, and rights in respect of the foregoing,
adequate for the performance of its obligations under the Unitil Contract
without known conflict with any rights of others.
Section 5.7. LITIGATION.
There are no actions, suits, proceedings or investigations of any kind
pending or threatened in writing against the Borrower before any court,
tribunal or administrative agency or board which, if adversely determined,
might, either in any case or in the aggregate, materially adversely affect
the properties, assets, financial condition or business of the Borrower or
materially impair the right of the Borrower to carry on business
substantially as now conducted, or result in any substantial liability not
adequately covered by insurance, or for which adequate reserves are not
maintained on the balance sheet of the Borrower, or which question the
validity of this Agreement or any of the other Loan Documents, or any action
taken or to be taken pursuant hereto or thereto.
Section 5.8. NO MATERIALLY ADVERSE CONTRACTS, ETC.
The Borrower is not subject to any charter, corporate or other legal
restriction, or any judgment, decree, order, rule or regulation which has or
is expected in the future to have a materially adverse effect on the
business, assets or financial condition of the Borrower. The Borrower is not
a party to any contract or agreement that has or is expected to have any
materially adverse effect on the business of the Borrower.
Section 5.9. COMPLIANCE WITH OTHER INSTRUMENTS, LAWS, ETC.
The Borrower has not violated and is not in violation of any provision
of its charter documents or bylaws or any agreement or instrument to which it
is subject or by which it or any of its properties is bound or any decree,
order, judgment, statute, license, rule or regulation, in a manner which is
reasonably expected to result in the imposition of substantial penalties or
materially and adversely affect the financial condition, properties or
business of the Borrower.
Section 5.10. TAX STATUS.
The Borrower has made or filed all federal and state income and all
other tax returns, reports and declarations required by any jurisdiction to
which it is subject; has paid all taxes and other governmental assessments
and charges shown or determined to be due on such returns, reports and
declarations, except those being contested in good faith and by appropriate
proceedings; and has set aside on its books provisions reasonably adequate
for the payment of all taxes for periods subsequent to the periods to which
such returns, reports or declarations apply in accordance with GAAP. There
are no unpaid taxes in any material amount claimed to be due by the taxing
authority of any jurisdiction, and the officers of the Borrower know of no
basis for any such claim.
Section 5.11. NO EVENT OF DEFAULT.
No Default or Event of Default has occurred and is continuing.
Section 5.12. GOVERNMENTAL REGULATION.
The Borrower is exempt from the provisions of the Public Utility Holding
Company Act of 1935 and the rules promulgated thereunder other than Section
9(a)(2) thereof, and is not a "subsidiary" or an "affiliate" of any "holding
company" as such terms are defined in the act. The Borrower is not subject
to any other law, rule or regulation which in any way restricts its ability
to incur Obligations pursuant to this Agreement or grants security interests
under the Security Documents. The Borrower is not an "investment company" or
an "affiliated company" or a "principal underwriter" of an "Investment
Company" as such terms are defined in the Investment Company Act of 1940, as
amended, and is not subject to the Public Utility Holding Company Act of
1935, but is subject to the federal Power Act and is in compliance with all
requirements therein.
Section 5.13. ABSENCE OF FINANCING STATEMENTS, ETC.
Except with respect to Permitted Liens, there is no financing statement,
security agreement, chattel mortgage, real estate mortgage or other document
filed or recorded with any filing records, registry, or other public office
which purports to cover, affect or give notice of any present or possible
future lien on, or security interest in, any assets or property of the
Borrower or any rights relating thereto.
Section 5.14. PERFECTION OF SECURITY INTERESTS.
All filings, assignments, pledges and deposits of documents or
instruments have been made and all other actions have been taken that are
necessary under applicable law, or reasonably requested by the Agent, to
establish and perfect the Agent's security interests in the Collateral. The
Collateral and the Agent's rights with respect to the Collateral are not
subject to any setoff, claims, withholdings or other defenses. The Borrower
is the owner of the Collateral free from any lien, security interest,
encumbrance and any other claim or demand, except for Permitted Liens.
Section 5.15. CERTAIN TRANSACTIONS.
Except for the transactions expressly contemplated by the Acquisition
Documents and except for arm's length transactions pursuant to which the
Borrower makes payments in the ordinary course of business upon terms no less
favorable than the Borrower could obtain from third parties, none of the
officers, directors, or employees of the Borrower is presently a party to any
transaction with the Borrower or an Affiliate (other than for services as
employees, officers and directors), including any contract, agreement or
other arrangement providing for the furnishing of services to or by,
providing for rental of real or personal property to or from, or otherwise
requiring payments to or from any officer, director or such employee or, to
the knowledge of the Borrower, any corporation, partnership, trust or other
entity, in which any officer, director, or any such employee has a
substantial interest or is an officer, director, trustee or partner.
Section 5.16. COMPLIANCE WITH ERISA.
The Borrower has satisfied the minimum funding standards under ERISA
with respect to its plans and is in compliance in all material respects with
the presently applicable provisions of ERISA.
Section 5.17. USE OF PROCEEDS.
(a) GENERAL. The proceeds of the Term Loan shall be used to
finance the purchase by the Borrower of the Unitil Contract and related
entitlements from Bangor pursuant to the terms of the Acquisition
Documents and to establish the Working Capital Reserve and general
corporate purposes.
(b) REGULATIONS U AND X. No portion of the Term Loan is to be
used for the purpose of purchasing or carrying any "margin security" or
"margin stock" as such terms are used in Regulations U and X of the
Board of Governors of the Federal Reserve System, 12 C.F.R. Parts 221
and 224.
(c) INELIGIBLE SECURITIES. No portion of the proceeds of the Term
Loan is to be used for the purpose of (a) knowingly purchasing, or
providing credit support for the purchase of, Ineligible Securities from
a Section 20 Subsidiary during any period in which such Section 20
Subsidiary makes a market in such Ineligible Securities, (b) knowingly
purchasing, or providing credit support for the purchase of, during the
underwriting or placement period, any Ineligible Securities being
underwritten or privately placed by a Section 20 Subsidiary, or
(c) making, or providing credit support for the making of, payments of
principal or interest on Ineligible Securities underwritten or privately
placed by a Section 20 Subsidiary and issued by or for the benefit of
the Borrower or any Affiliate of the Borrower.
Section 5.18. SUBSIDIARIES, ETC.
The Borrower has no Subsidiaries and is not engaged in any joint venture
or partnership with any other Person.
Section 5.19. DISCLOSURE.
The written information provided by the Borrower to the Agent or the
Banks pursuant to the Loan Documents does not contain any untrue statement of
a material fact or omit to state a material fact necessary in order to make
the statements herein or therein, in light of the circumstances under which
they were made, not misleading. There is no fact known to the Borrower which
materially adversely affects, or which is reasonably likely in the future to
materially adversely affect, the business, assets or financial condition of
the Borrower, exclusive of effects resulting from changes in general economic
conditions, legal standards or regulatory conditions.
Section 5.20. OPEN MARKET PURCHASES.
The Borrower has the ability without taking any further action, to purchase
energy and capacity from qualifying facilities in the open market at all
times.
Section 5.21. NO AMENDMENT TO DOCUMENTS; DOCUMENTS IN FULL FORCE.
The Borrower has not (i) amended any of the Acquisition Documents and
(ii) In addition, the Unitil Contract and each Acquisition Document is in
full force and effect, and no material defaults by the Borrower (and to the
Borrower's knowledge by any other Person) have occurred and are continuing
under such documents. The Borrower provided the Agent a true and complete
copy of the Unitil Contract.
Section 6. AFFIRMATIVE COVENANTS OF THE BORROWER.
The Borrower covenants and agrees that, so long as the Term Loan or any
Term Note or portion thereof is outstanding:
Section 6.1. PUNCTUAL PAYMENT.
The Borrower will duly and punctually pay or cause to be paid the
principal and interest on the Term Loan, and all fees and other amounts
provided for in this Agreement and the other Loan Documents, all in
accordance with the terms of this Agreement and such other Loan Documents.
Section 6.2. RECORDS AND ACCOUNTS.
The Borrower will (a) keep true and accurate records and books of
account in which full, true and correct entries will be made in accordance
with GAAP and with the requirements of all regulatory authorities,
(b) maintain adequate accounts and reserves for all taxes (including income
taxes), depreciation, depletion, obsolescence and amortization of its
properties and all other proper reserves and (c) at all times engage the
Accountants as the independent certified public accountants of the Borrower
and will not permit more than thirty (30) days to elapse between the
cessation of such firm's (or any successor firm's) engagement as the
independent certified public accountants of the Borrower and the appointment
of successor Accountants.
Section 6.3. FINANCIAL STATEMENTS, CERTIFICATES AND OTHER
INFORMATION.
The Borrower will deliver to each of the Banks (or to the Agent as noted
in (d), (e) and (f)):
(a) as soon as practicable, but, in any event not later than
ninety (90) days after the end of each fiscal year of the Borrower, the
balance sheet of the Borrower as at the end of such year, and the
related statements of cash flows, operations and retained earnings for
such year, each setting forth in comparative form the figures for the
previous fiscal year, all such statements to be in reasonable detail,
prepared in accordance with GAAP, and certified without qualification by
Coopers & Lybrand, or by any other nationally recognized independent
certified public accounting firm that is currently known as a "Big Four"
accounting firm, or any other independent accounting firm acceptable to
the Agent (the "Accountants"), together with a written statement from
such Accountants to the effect that they have read a copy of this
Agreement, and that, in making the examination necessary to said
certification, they have obtained no knowledge of any Default or Event
of Default, or, if such Accountants shall have obtained knowledge of any
then existing Default or Event of Default they shall disclose in such
statement any such Default or Event of Default;
(b) as soon as practicable, but in any event not later than forty-
five (45) days after the end of each of the fiscal quarters of the
Borrower, copies of the balance sheet and statement of operations of the
Borrower as at the end of such quarter, subject to year end audit
adjustments, and statement of income and cash flows, all in reasonable
detail and prepared in accordance with GAAP, together with a
certification by the principal financial or accounting officer of the
Borrower that such financial statements have been prepared in accordance
with GAAP and fairly present in all material respects the financial
condition of the Borrower as at the close of business on the date
thereof and the results of operations for the period then ended;
(c) simultaneously with the delivery of the financial statements
referred to in subsections (a) and (b) above, a statement certified by
the principal financial or accounting officer of the Borrower in
substantially the form of EXHIBIT D hereto and setting forth in
reasonable detail computations evidencing compliance with the covenants
contained in Section 8 and (if applicable) reconciliations to reflect
changes in GAAP since the Balance Sheet Date;
(d) all quarterly reports required to be filed with FERC pursuant
to the FERC Order, all market analysis required to be delivered to FERC
pursuant to the FERC Subsequent Order, and any other reports as may be
required from time to time to be delivered to FERC shall be provided to
the Agent;
(e) ten (10) days following the end of each month, copies of all
billing invoices for the month ending related to the Unitil Contract
shall be provided to the Agent;
(f) within ten (10) days after delivering any notices or
correspondences to FERC, copies to the Agent of all such documents and
within ten (10) days of receiving any notices or other correspondence
from FERC, copies to the Agent of all such documents; and
(g) from time to time such other financial data and information
(including accountants, management letters and updated projections) as
the Agent may reasonably request shall be provided to the Agent.
The Borrower hereby authorizes the Agent or the Banks to disclose any
information obtained pursuant to this Agreement to all appropriate
governmental regulatory authorities where required by law.
Section 6.4. CORPORATE EXISTENCE AND CONDUCT OF BUSINESS.
The Borrower will do or cause to be done all things necessary to
preserve and keep in full force and effect its corporate existence, corporate
rights and franchises and will not convert to a limited liability company.
Section 6.5. MAINTENANCE OF PROPERTIES.
The Borrower will cause all of its properties used or useful in the
conduct of its business to be maintained and kept in good condition, repair
and working order and supplied with all necessary equipment and will cause to
be made all necessary repairs, renewals, replacements, betterments and
improvements thereof, all as in the judgment of the Borrower may be necessary
so that the business carried on in connection therewith may be properly and
advantageously conducted at all times and will continue to engage solely in
the businesses of supplying power pursuant to the Unitil Contract.
Section 6.6. MAINTENANCE OF OFFICE.
The Borrower will maintain its chief executive offices at 33 State
Street, P.O. Box 932, Bangor, Maine 04402 or at such other place in the
United States of America as the Borrower shall designate upon thirty
(30) days prior written notice to the Agent.
Section 6.7. INSURANCE.
The Borrower will maintain with financially sound and reputable insurers
insurance and bonds of the types, in the amounts, and for the time periods
set forth in SCHEDULE 6.7, the covenants and agreements of which are hereby
incorporated by reference as if fully set forth herein, and such other
insurance as the Agent may from time to time reasonably request to be
maintained.
Section 6.8. TAXES.
The Borrower will duly pay and discharge, or cause to be paid and
discharged, before the same shall become overdue, all taxes, assessments and
other governmental charges imposed upon it and its real properties, sale and
activities, or any part thereof, or upon the income or profits therefrom, as
well as all claims for labor, materials, or supplies, which if unpaid might
by law become a lien or charge upon any of its property, except any such
taxes, assessments, charges or claims which are being diligently contested in
good faith by appropriate proceedings and for which adequate reserves in
accordance with GAAP shall be maintained; PROVIDED, HOWEVER, that any such
tax, assessment, charge, levy or claim need not be paid if the validity or
amount thereof shall currently be contested in good faith by appropriate
proceedings and if the Borrower shall have set aside on its books adequate
reserves with respect thereto; and PROVIDED, FURTHER, that the Borrower shall
pay all such taxes, assessments, charges, levies or claims forthwith upon the
commencement of proceedings to foreclose any lien which may have attached as
security therefor.
Section 6.9. INSPECTION OF PROPERTIES, BOOKS, AND CONTRACTS.
The Borrower shall permit the Agent or any of its agents and consultants
to visit and inspect any of the properties of the Borrower, to examine the
books of account of the Borrower and to make copies thereof and extracts
therefrom and to discuss the affairs, finances and accounts of the Borrower
with, and to be advised as to the same by, its officers, all at such
reasonable times and intervals as the Agent may reasonably request.
Section 6.10. COMPLIANCE WITH LAWS, CONTRACTS, LICENSES AND PERMITS.
The Borrower will comply with (a) the provisions of its charter
documents and by-laws and (b)(i) all agreements and instruments by which it
or any of its properties may be bound; and (ii) all applicable laws and
regulations (including Environmental Laws), decrees, orders and judgments
("APPLICABLE LAWS"), except, where failure to so comply is not reasonably
expected to have a materially adverse effect. If at any time while any Term
Note or the Term Loan is outstanding, any authorization, consent, approval,
permit or license from any officer, agency or instrumentality of any
government shall become necessary or required in order that the Borrower may
fulfill any of its obligations hereunder or under any of the Loan Documents,
the Borrower will immediately take or cause to be taken all reasonable steps
to obtain such authorization, consent, approval, permit or license and
furnish the Agent with evidence thereof.
Section 6.11. NOTICE OF DEFAULT.
The Borrower will promptly notify the Agent and each of the Banks in
writing of the occurrence of any Default or Event of Default, and will notify
the Agent of a claimed default (whether or not constituting an Event of
Default) with respect to other Indebtedness of the Borrower describing the
notice of action and the nature of the claimed default.
Section 6.12. ENVIRONMENTAL EVENTS.
The Borrower will promptly give notice to the Agent and each of the
Banks (a) of any violation of any Environmental Law that the Borrower reports
in writing or is reportable by the Borrower in writing (or for which any
written report supplemental to any oral report is made) to any federal, state
or local environmental agency and (b) upon becoming aware thereof, of any
inquiry, proceeding, investigation, or other action, including a notice from
any agency of potential environmental liability, of any federal, state or
local environmental agency or board, that is reasonably expected to
materially affect the assets, liabilities, financial conditions or operations
of the Borrower, or the Agent's security interests pursuant to the Security
Documents.
Section 6.13. NOTIFICATION OF CLAIM AGAINST COLLATERAL.
The Borrower will, immediately upon becoming aware thereof, notify the
Agent in writing of any setoff, claims (including environmental claims),
withholdings or other defenses to which any of the Collateral, or the Agent's
rights with respect to the Collateral, are subject, other than Permitted
Liens.
Section 6.14. NOTICE OF LITIGATION AND JUDGMENTS.
The Borrower will give notice to the Agent in writing within fifteen
(15) days of becoming aware of any litigation or proceedings threatened in
writing or any pending litigation and proceedings affecting the Borrower or
to which the Borrower is or becomes a party involving an uninsured claim
against the Borrower that could reasonably be expected to have a materially
adverse effect on the Borrower and stating the nature and status of such
litigation or proceedings. The Borrower will give notice to the Agent, in
writing, in form and detail reasonably satisfactory to the Agent, within ten
(10) days of any unpaid judgment not covered by insurance, final or
otherwise, against the Borrower in an amount in excess of $100,000.
Section 6.15. USE OF PROCEEDS.
The Borrower will use the proceeds of the Term Loan solely in the manner
provided in Section 5.17.
Section 6.16. LOCKBOX ACCOUNT.
The Borrower will, except as provided in herein, by not later than the
Closing Date, replace any existing depository accounts with a lock box
account (the "Lockbox Account") under the control of the Agent in the name of
the Borrower and direct its account debtors and obligors on instruments or
other obligors of the Borrower with respect to any of the Collateral,
pursuant to a form of notification letter (a "Direct Collection Letter") in
substantially the form of EXHIBIT E which Direct Collection Letter shall be
deemed to satisfy the requirements of Section 4.2 of the Lockbox Agreement,
to make all payments on or with respect to any of the Collateral due or to
become due to the Borrower directly to the Lockbox Account. The Borrower
hereby agrees that such directions cannot be revoked or otherwise varied
without the consent of the Agent. The Borrower further agrees that all such
payments received in such Lockbox Account will be the sole and exclusive
property of the Agent for the benefit of the Agent and the Banks, except to
the extent expressly provided herein or therein. If, notwithstanding the
issuance of such Direct Collection Letters, the Borrower receives any cash
proceeds of any of the Collateral, whether in the form of money, checks or
otherwise, the Borrower will hold such cash proceeds in trust for the benefit
of the Agent and the Banks and turn such cash proceeds promptly over to the
Agent in the identical form received to be deposited in the Lockbox Account.
Upon receipt of any funds in the Lockbox Account, the Agent is hereby
directed to:
(i) first, on each date on which the Borrower is required to make a
payment pursuant to Section 2.3, Section 2.5 and Section 3.1
hereunder, and to the extent on such date the Agent determines that
good funds have been received, apply the funds in the Lockbox Account
to the payment of the amounts then due and payable pursuant to 2.3,
Section 2.5 and Section 3.1 hereunder;
(ii) second, on the thirtieth (30th) Business Day (or such earlier
time as the Borrower may authorize) following a written notice by the
Agent to the Borrower setting forth the amount of any fees, expenses
and other payments to be made hereunder (other than pursuant to (i)
above) and a brief explanation of such amounts, and to the extent on
such date the Agent determines that good funds have been received,
apply the funds in the Lockbox Account to the payment of any such
amounts;
(iii) third, to the extent funds in the Cash Collateral Account are
less than the Working Capital Reserve, deposit to the Cash Collateral
Account an amount equal to the shortfall in the Working Capital
Reserve, to be invested or applied in accordance with the terms of
the Cash Collateral Agreement;
(iv) fourth, deposit to an operating account of the Borrower
maintained with the Agent (the "Operating Account") all unpaid
amounts owing by the Borrower to any Person that have accrued up to
and including such date (including, without limitation, accrued
interest on the Loan) and accrued fees and expenses of the Borrower
to any Person (such deposited amounts, collectively, the "Accrued
Amounts"); and
(v) fifth, if no Default or Event of Default shall have occurred and
be continuing, deposit any amounts in the Lockbox Account that have
not been applied pursuant to clauses (i), (ii), (iii) and (iv) above,
in the Operating Account or as otherwise directed by the Borrower
from time to time.
For purposes of the foregoing provisions of this Section 6.16 the Agent shall
not be deemed to have received any such cash proceeds on any day unless
received by the Agent before 3:00 p.m. (Boston time) on such day. The
Borrower further acknowledge and agree that any provisional credit shall be
subject to reversal if final collection in good funds of the related item is
not received by the Agent in accordance with the Agent's customary procedures
and practices for collecting provisional items. The parties hereto hereby
agree that, notwithstanding anything to the contrary herein or any of the
other Loan Documents, (i) any amounts deposited in the Operating Account
shall be automatically released from the security interest granted to the
Agent under the Loan Documents, (ii) the Operating Account and any amounts
held therein shall not be subject to a security interest of the Agent under
the Loan Documents and (iii) all amounts held in the Operating Account shall
be applied by the Borrower in its sole discretion from time to time;
PROVIDED, HOWEVER, the Borrower agrees that it will maintain in the Operating
Account and in investments permitted by Section 7.3 an aggregate amount at
least equal to Accrued Amounts representing accrued and unpaid amounts
referred to in subparagraph (iv) above that have not been paid or satisfied
by payment by the Borrower from such Operating Account or otherwise.
Section 6.17. INTEREST RATE PROTECTION.
The Borrower will, not later than thirty (30) days after the Closing
Date, purchase an interest rate cap or swap or effect other interest rate
protection arrangements through the Term Loan Maturity Date for not less than
the balance of the Term Loan outstanding from time to time, on terms and
conditions satisfactory to the Agent, PROVIDED, that the parties hereto agree
that if at the time the Borrower is purchasing such cap or swap or otherwise
effecting such arrangements the Borrower is unable to fix the interest rate
at a rate of eight percent (8%) per annum or lower, the Borrower shall
immediately repay to the Agent for the respective accounts of the Banks that
portion of the Term Loan which would be necessary in order for the Borrower
to comply with the Debt Service Coverage Ratio set forth in Section 8 hereof
at the applicable periods set forth therein (calculated on a PRO FORMA basis
immediately after giving effect to such repayment).
Section 6.18. MAINTENANCE OF WORKING CAPITAL RESERVE.
The Borrower shall at all time maintain not less than the Working Capital
Reserve in a cash collateral account with the Agent and governed by the Cash
Collateral Agreement.
Section 6.19. FURTHER ASSURANCES.
The Borrower will cooperate with the Agent and execute such further
instruments and documents as the Agent shall reasonably request to carry out
to their satisfaction the transactions contemplated by this Agreement and the
other Loan Documents.
Section 7. CERTAIN NEGATIVE COVENANTS OF THE BORROWER.
The Borrower covenants and agrees that, so long as the Term Loan, the
Term Note, or any portion thereof is outstanding:
Section 7.1. RESTRICTIONS ON INDEBTEDNESS.
The Borrower will not create, incur, assume, guarantee or be or remain
liable, contingently or otherwise, with respect to any Indebtedness other
than:
(a) Indebtedness to the Banks and the Agent arising under this
Agreement or the other Loan Documents;
(b) current liabilities of the Borrower incurred in the ordinary
course of business not incurred through (i) the borrowing of money, or
(ii) the obtaining of credit except for credit on an open account basis
customarily extended and in fact extended in connection with normal
purchases of goods and services;
(c) Indebtedness in respect of taxes, assessments, governmental
charges levies and claims for labor, worker's compensation, materials
and supplies to the extent that payment therefor shall not at the time
be required to be made in accordance with the provisions of Section 6.8;
(d) Indebtedness of the Borrower in respect of interest rate
protection arrangement required to be maintained by Section 6.17 so long
as such arrangements are in the ordinary course of business and not for
speculative purposes; and
(e) Indebtedness in respect of judgments or awards which have been
in force for less than the applicable period for taking an appeal so
long as execution is not levied thereunder or in respect of which the
Borrower shall at the time in good faith be prosecuting an appeal or
proceedings for review and in respect of which a stay of execution shall
have been obtained pending such appeal or review and in respect of which
the Borrower has maintained adequate reserves.
Section 7.2. RESTRICTIONS ON LIENS.
The Borrower will not (i) create or incur or suffer to be created or
incurred or to exist any lien, encumbrance, mortgage, pledge, charge,
restriction or other security interest of any kind upon any of its property
or assets of any character whether now owned or hereafter acquired, or upon
the income or profits therefrom; (ii) transfer any of such property or assets
or the income or profits therefrom for the purpose of subjecting the same to
the payment of Indebtedness or performance of any other obligation in
priority to payment of its general creditors; (iii) acquire, or agree or have
an option to acquire, any property or assets upon conditional sale or other
title retention or purchase money security agreement, device or arrangement;
(iv) suffer to exist for a period of more than thirty (30) days after the
same shall have been incurred any Indebtedness or claim or demand against it
which if unpaid might by law or upon bankruptcy or insolvency, or otherwise,
be given any priority whatsoever over its general creditors; or (v) sell,
assign, pledge or otherwise transfer any accounts, contract rights, general
intangibles or chattel paper, with or without recourse, except the following
(the "Permitted Liens"):
(a) liens in favor of the Agent for the benefit of the Banks and
the Agent under the Loan Documents;
(b) deposits or pledges made in connection with, or to secure
payment of, workmen's compensation, unemployment insurance, old age
pensions or other social security obligations;
(c) liens to secure taxes, assessments and other governmental
charges in respect of obligations not overdue or liens on properties to
secure claims for labor, material or supplies in respect of obligations
not overdue, or, in each case, which are being contested in good faith
by appropriate proceedings diligently conducted and with respect to
which adequate reserves are being maintained in accordance with GAAP so
long as such liens are not being foreclosed;
(d) liens on properties in respect of judgments or awards that
have been in force for less than the applicable period for taking on
appeal so long as execution is not levied thereunder or in respect of
which the Borrower shall at the time in good faith be prosecuting an
appeal or proceeding for review and in respect of which a stay of
execution shall have been obtained pending such appeal or review; and
(e) liens of carriers, warehousemen, mechanics and materialmen,
and other like liens on properties, in existence less than one hundred
twenty (120) days from the date of creation thereof in respect of
obligations not overdue, or which are being contested in good faith by
appropriate proceedings diligently conducted and with respect to which
adequate reserves are being maintained in accordance with GAAP so long
as such liens are not being foreclosed.
Section 7.3. RESTRICTIONS ON INVESTMENTS.
The Borrower will not make or permit to exist or to remain outstanding
any Investment except Investments in:
(a) marketable direct or guaranteed obligations of the United
States of America which mature within one year from the date of purchase
by the Borrower;
(b) demand deposits, certificates of deposit, time deposits or
repurchase agreements which are fully insured or are issued by
commercial banks organized under the laws of the United States of
America or any state thereof and having total assets in excess of
$1,000,000,000;
(c) securities commonly known as "commercial paper" issued by a
corporation organized and existing under the laws of the United States
of America or any state thereof that at the time of purchase have been
rated and the ratings for which are not less than "P-1" if rated by
Moody's Investors Services, Inc., and not less than "A-1" if rated by
Standard and Poor's Rating Group;
(d) and Investments pursuant to the Borrower's Investment Policy
as in effect on the Closing Date and more fully described on SCHEDULE
7.3 hereto;
PROVIDED, HOWEVER, that such Investments will be considered Investments
permitted by this Section 7.3 only if all actions have been taken to the
satisfaction of the Agent to provide the Agent, for the benefit of the Banks
and the Agent, a first priority perfected security interest in all of such
Investments free of all encumbrances other than Permitted Liens.
Nothwithstanding anything to the contrary in the Loan Documents, the
requirements of this Section 7.3 that the Agent be provided a first priority
perfected security interest in all such Investments shall be complied with by
the filing of a Uniform Commercial Code financing statement with respect
thereto (including a financing statement filed pursuant to Section 9.9) and
by such further actions as may be reasonably requested by the Agent from time
to time.
Section 7.4. MERGER, CONSOLIDATIONS, SALES.
The Borrower will not be a party to any merger, consolidation or
exchange of stock, or purchase or otherwise acquire all or substantially all
of the assets or stock of any class of, or any partnership or joint venture
interest in, any other Person or sell, transfer, convey or lease any assets
(except as contemplated under the Unitil Contract with respect to energy
sales), or group of assets, or sell, or assign, with or without recourse, any
receivables, in each case, except as contemplated by the Loan Documents. The
Borrower will not form, purchase or otherwise acquire any Subsidiary without
the prior written consent of the Majority Banks.
Section 7.5. DISTRIBUTIONS.
The Borrower will not make any Distributions; PROVIDED, HOWEVER, so long
as no Default or Event of Default has occurred and is continuing or would
exist as a result thereof, the Borrower shall be permitted to make a
Distributions to Bangor so long as immediately after giving effect thereto
the Working Capital Reserve is fully funded and remains subject to the Cash
Collateral Agreement.
Section 7.6. SALE AND LEASEBACK.
The Borrower will not enter into any arrangement, directly or
indirectly, whereby the Borrower shall sell or transfer any property owned by
it in order then or thereafter to lease such property or lease other property
that the Borrower intends to use for substantially the same purpose as the
property being sold or transferred.
Section 7.7. AMENDMENT TO UNITIL CONTRACT AND ACQUISITION DOCUMENTS.
The Borrower will not amend, supplement or otherwise modify the terms of
the Unitil Contract or any of the Acquisition Documents or terminate the
Unitil Contract.
Section 7.8. BUSINESS ACTIVITIES.
The Borrower will not engage directly or indirectly in any type of
business other than the supplying of power pursuant to the Unitil Contract.
Section 7.9. FISCAL YEAR.
The Borrower will not change the date of the end of its fiscal year from
that set forth in Section 5.4(a).
Section 7.10. TRANSACTIONS WITH AFFILIATES.
Except as expressly permitted by the Acquisition Documents, the Borrower
will not engage in any transaction with any Affiliate (other than for
services as employees, officers and directors), including any contract,
agreement or other arrangement providing for the furnishing of services to or
by, providing for rental of real or personal property to or from, or
otherwise requiring payments to or from any such Affiliate or, to the
knowledge of the Borrower, any corporation, partnership, trust or other
entity in which any such Affiliate has a substantial interest or is an
officer, director, trustee or partner, on terms more favorable to such Person
than would have been obtainable on an arm's-length basis in the ordinary
course of business.
Section 7.11. BANK ACCOUNTS.
The Borrower will not establish any bank accounts other than those
accounts listed on SCHEDULE 7.11, without the Agent's prior written consent.
Section 7.12. NO CHANGES TO CORPORATE DOCUMENTS.
The Borrower will not effect or permit any change in or amendment to any
document or instrument pertaining to the terms of its capital stock
(including, without limitation, its certificate of incorporation) unless such
a change or amendment is immaterial and ministerial in nature and would not
have a material adverse effect on the business, assets, condition (financial
or otherwise) or properties of the Borrower, or the Collateral, or the rights
and remedies of the Agent or any Bank under the Loan Documents or the ability
of the Borrower to perform its Obligations under the Loan Documents.
Section 8. FINANCIAL COVENANTS
The Borrower covenants and agrees that, so long as the Term Loan or any
portion of the Term Note is outstanding:
Section 8.1. NET WORTH.
The Borrower will not permit Net Worth at any time (a) for the period
from the Closing Date through December 31, 1998, to be less than $0, (b) for
the period from January 1, 1999 through December 31, 1999, to be less than
$3,500,000, (c) for the period from January 1, 2000 through December 31,
2000, to be less than $8,000,000, (d) for the period from January 1, 2001
through December 31, 2001, to be less than $13,500,000 (e) for the period
from January 1, 2002 through December 31, 2002, to be less than $19,500,000
and (f) at any time thereafter, to be less than $22,500,000.
Section 8.2. DEBT SERVICE RATIO.
The Borrower will not (a) as of the end of the fiscal quarter ending
September 30, 1998 permit the Debt Service Ratio for such period to be less
than 1.00:1.00, and (b) as of the end of each fiscal quarter ending
thereafter, permit the Debt Service Ratio for such period to be less than
1.20:1.00.
Section 8.3. CAPITAL EXPENDITURES.
The Borrower will not make Capital Expenditures at any time.
SECTION 9. CLOSING CONDITIONS.
The obligations of the Banks to make the Term Loan hereunder shall be
subject to the satisfaction of the following conditions precedent:
Section 9.1. LOAN DOCUMENTS ETC.
(a) LOAN DOCUMENTS. Each of the Loan Documents shall have been
duly executed and delivered by the respective parties thereto, shall be
in full force and effect and shall be in form and substance satisfactory
to the Agent.
(b) ACQUISITION DOCUMENTS. Each of the Acquisition Documents
shall have been duly executed and delivered by the respective parties
thereto, shall be in full force and effect and shall be in form and
substance reasonably satisfactory to the Agent. Each Bank shall have
received a fully executed copy of each such document.
Section 9.2. REPRESENTATIONS AND WARRANTIES.
Each of the representations and warranties contained in this Agreement,
the other Loan Documents or in any document or instrument delivered pursuant
to or in connection with this Agreement shall have been correct at and as of
the date made and on the Closing Date, except to the extent that such
representations and warranties expressly related to a specific date or were
based on facts which have changed, and which facts, as so changed, either in
any individual case or in the aggregate, do not materially adversely affect
the Borrower, its business or its financial condition.
Section 9.3. PERFORMANCE; NO DEFAULT.
Bangor and the Borrower shall have performed and complied in all
respects with all terms and conditions herein and in the other Loan Documents
required to be performed or complied with by it prior to or at the time of
the Term Loan, and at the time of the Term Loan there shall exist no Default
or Event of Default nor shall the consummation of the transactions hereby
result in a Default or an Event of Default or condition which would, with
either or both the giving of notice or the lapse of time, result in a Default
or Event of Default upon consummation of the Term Loan.
Section 9.4. CERTIFIED COPIES OF CHARTER DOCUMENTS.
The Agent shall have received from Bangor and the Borrower a copy,
certified by a duly authorized officer of such Person to be true and complete
as of the Closing Date, of each of (a) its charter or other incorporation
documents as in effect on such date and (b) its bylaws as in effect on such
date.
Section 9.5. PROOF OF CORPORATE ACTION.
The Agent shall have received from Bangor and the Borrower copies,
certified by a duly authorized officer to be true and complete as of the
Closing Date, of the records of all corporate action taken to authorize
(a) its execution and delivery of each of the Loan Documents to which it is
or is to become a party, (b) its performance of all of its agreements and
obligations under each of such documents and (c) the borrowings and other
transactions contemplated by this Agreement.
Section 9.6. INCUMBENCY CERTIFICATE.
The Agent shall have received from Bangor and the Borrower an incumbency
certificate, dated as of the Closing Date and signed by a duly authorized
officer of such Person, giving the name and bearing a specimen signature of
each individual who shall be authorized (a) to sign, in its name and on its
behalf, each of the Loan Documents to which it is or is to become a party,
(b) in the case of the Borrower, to make the initial loan request and
Conversion Requests and (c) to give notices and to take other action on its
behalf under the Loan Documents.
Section 9.7. LEGALITY.
The Agent shall have received evidence satisfactory to the Agent that
the making of the Term Loan does not contravene any law, regulation, decree
or order binding on the Borrower, and the Agent shall have received all such
certificates and documents in relation thereto as the Bank or the Agent's
Special Counsel shall have requested.
Section 9.8. CERTIFICATES OF INSURANCE.
The Agent shall have received (a) a certificate of insurance from an
independent insurance broker dated on or before the Closing Date, identifying
insurers, types of insurance, insurance limits, and policy terms, and
otherwise describing the insurance obtained in accordance with the provisions
of the Security Agreement and certifying that the Borrower and the Agent
shall be named additional insured under the umbrella insurance policy of
Bangor, as the case may be, and (b) copies of all policies evidencing such
insurance (or certificates therefor signed by the insurer or an agent
authorized to bind the insurer).
Section 9.9. VALIDITY OF LIENS.
The Security Documents shall be effective to create in favor of the
Agent, for the benefit of the Agent and the Banks, a legal, valid and
enforceable first security interest in and lien upon the Collateral. All
filings, recordings, deliveries of instruments and other actions necessary or
desirable in the opinion of the Agent to protect and preserve such security
interests shall have been duly effected. The Agent shall have received
evidence thereof in form and substance satisfactory to the Agent.
Section 9.10. PERFECTION CERTIFICATE; UCC SEARCH RESULTS.
The Agent shall have received from the Borrower a completed and fully
executed Perfection Certificate and the results of UCC searches with respect
to the Collateral, indicating no liens other than Permitted Liens and
otherwise in form and substance satisfactory to the Agent.
Section 9.11. BORROWER'S AND GUARANTOR'S FINANCIAL STATEMENT.
The Agent shall have received the financial statements referred to in
Section 5.4, together with copies of Bangor's most recent audited annual
financial statements and management prepared quarterly financial statements,
and a certificate of the Treasurer of each of Bangor and the Borrower
certifying that each such Person is not insolvent and will not be rendered
insolvent as a result of the transactions contemplated hereby or referred to
herein, and the Agent shall be satisfied that such financial statements
fairly present in all material respects the business and financial condition
of the Borrower and Bangor as of the date thereof.
Section 9.12. PROCEEDINGS AND DOCUMENTS.
All proceedings in connection with the transactions contemplated by this
Agreement and all documents incident thereto shall have been delivered to the
Agent as of the date hereof in substance and in form satisfactory to the
Agent, and the Agent shall have received all information and such counterpart
originals or certified or other copies of such documents as the Agent may
reasonably request.
Section 9.13. OTHER CONSENTS AND APPROVALS.
The Agent shall have received the Unitil Certificate and all other
waivers and consents from any source reasonably requested by it (including,
without limitation, the Consent under the Chase Credit Agreement), in form
satisfactory to it and the Agent's Special Counsel, in connection with the
transactions contemplated by this Agreement.
Section 9.14. OPINIONS OF COUNSEL.
The Agent and each of the Banks shall have received a favorable legal
opinion addressed to the Agent and the Banks, dated as of the Closing Date,
in form and substance satisfactory to the Agent and the Banks, from: (a) Drew
Landry, the general counsel to Bangor and the Borrower; (b) Winthrop,
Stimson, Putnam & Roberts, special New York counsel to Bangor and the
Borrower and (c) Wright & Talisman, P.C., regulatory counsel to Bangor and
the Borrower (which opinion shall state that no motions to intervene or
protests have been filed with FERC pursuant to the FERC Notice and that
actions taken by FERC are final and unappealable).
Section 9.15. DISBURSEMENT INSTRUCTIONS.
The Agent shall have received disbursement instructions from the
Borrower including instructions for the payment to Bangor of the purchase
price set forth in the Unitil Assignment Agreement and the funding of the
Working Capital Reserve.
Section 9.16. NO LEGAL IMPEDIMENT.
No change shall have occurred in any law or regulations thereunder or
interpretations thereof that in the reasonable opinion of the Agent would
make it illegal for the Agent to make the Term Loan.
Section 9.17. INTEREST RATE PROTECTION ARRANGEMENTS.
The Borrower shall have demonstrated to the satisfaction of the Agent
that the Borrower has complied with the provisions of Section 6.17 hereof.
Section 9.18. RECEIPT OF FERC NOTIFICATION.
The Borrower shall provide the Agent with evidence on the Closing Date
that it has notified FERC of the effectiveness of the Acquisition pursuant to
order (E) of the FERC Subsequent Order.
Section 9.19. REVISION OF POWER SALE AGREEMENT.
The Borrower shall provide the Agent with evidence that Bangor and the
Borrower have revised the Rate Schedule Agreement as required by the FERC
Letter.
Section 9.20. EVIDENCE OF REVISION OF CODE OF CONDUCT
The Borrower shall provide the Agent with evidence that it has timely
filed with FERC a revised code of conduct as required by the FERC Order.
Section 10. EVENTS OF DEFAULT; ACCELERATION.
Section 10.1. EVENTS OF DEFAULT.
If any of the following events ("Events of Default" or, if notice or
lapse of time or notice and lapse of time is required, then prior to such
notice and/or lapse of time, "Defaults") shall occur:
(a) the Borrower shall fail to pay any principal on the Term Loan
when the same shall become due and payable, whether at the stated date
of maturity or any accelerated date of maturity or at any other date
fixed for payment;
(b) the Borrower shall fail to pay any interest or fees due
hereunder or under any of the Loan Documents when the same shall become
due and payable whether at the stated date of maturity or any
accelerated date of maturity or at any other date fixed for payment
within three (3) days after the same shall become due and payable;
(c) the Borrower shall fail to comply with its covenants contained
in Section 6.4, Section 7 or Section 8 hereof or Bangor shall fail to
comply with the covenants contained in the Guaranty;
(d) the Borrower shall fail to perform any term, covenant or
agreement contained herein or in any of the other Loan Documents (other
than those specified in subsections (a), (b), and (c) above) for fifteen
(15) days after written notice of such failure has been given to
Borrower by the Agent;
(e) any representation or warranty of the Borrower or Bangor in
this Agreement or in any of the other Loan Documents or in any other
document or instrument delivered pursuant to or in connection with this
Agreement shall prove to have been false or incorrect in any material
respect on the date when made or deemed to have been made or repeated;
(f) Bangor or the Borrower shall fail to pay at maturity, or
within any applicable grace period, any obligation for borrowed money or
credit received or in respect of any Capitalized Lease (other than the
Loan Documents) or fail to observe or perform any material term,
covenant or agreement contained in any agreement by which it is bound,
evidencing or securing borrowed money or credit received or in respect
of any Capitalized Leases for such period of time as would permit
(assuming the giving of appropriate notice if required) the holder or
holders thereof or of any obligations issued thereunder to accelerate
the maturity thereof;
(g) Bangor or the Borrower makes an assignment for the benefit of
creditors, or admits in writing its inability to pay or generally fails
to pay its debts as they mature or become due, or shall petition to or
apply for the appointment of a trustee or other custodian, liquidator or
receiver of Bangor's or of any substantial part of the assets of Bangor
or the Borrower or shall commence any case or other proceeding relating
to Bangor or the Borrower under any bankruptcy, reorganization,
arrangement, insolvency, readjustment of debt, dissolution or
liquidation or similar law of any jurisdiction, now or hereafter in
effect, or shall take any action to authorize or in furtherance of any
of the foregoing, or if any such petition or application is filed or any
such case or other proceeding shall be commenced against Bangor or the
Borrower, and Bangor or Borrower indicates its approval thereof, consent
thereto or acquiescence therein or such petition or application shall
not have been dismissed within sixty (60) days following the filing
thereof;
(h) a decree or order is entered appointing any such trustee,
custodian, liquidator or receiver or adjudicating Bangor or the Borrower
bankrupt or insolvent, or approving a petition in any such case or other
proceeding, or a decree or order for relief is entered in respect of
Bangor or the Borrower in an involuntary case under federal bankruptcy
laws as now or hereafter constituted;
(i) there shall remain in force, undischarged, unsatisfied and
unstayed for more than sixty (60) days, any final unpaid judgment (from
which all appeals have been taken and determined or as to which all time
for appeals has lapsed) against the Borrower which, with other
outstanding final judgments shall continue unsatisfied and in effect,
(net of uncontested insurance coverage) against the Borrower exceeding
in the aggregate $100,000;
(j) Chase shall commence any legal action to foreclose on the
capital stock of the Borrower pledged to Chase pursuant to the Chase
Credit Agreement;
(k) if any of the Loan Documents or any Acquisition Document shall
be cancelled, terminated, revoked or rescinded or the Agent's security
interests, mortgages or liens in a substantial portion of the Collateral
shall cease to be perfected, or shall cease to have the priority
contemplated by the Security Documents, in each case otherwise than in
accordance with the terms thereof, or any action at law, suit or in
equity or other legal proceeding to cancel, revoke or rescind any of the
Loan Documents shall be commenced by or on behalf of the Borrower or any
party thereto or any of their respective stockholders, or any court or
any other governmental or regulatory authority or agency of competent
jurisdiction shall make a determination that, or issue a judgment,
order, decree or ruling to the effect that, any one or more of the Loan
Documents is illegal, invalid or unenforceable in accordance with the
terms thereof;
(l) the Borrower or any ERISA Affiliate shall fail to pay when due
an amount or amounts aggregating in excess of $100,000 which it shall
have become liable to pay to the PBGC or to an Employee Benefit Plan
under Title IV of ERISA; or notice of intent to terminate an Employee
Benefit Plan or Employee Benefit Plans having an aggregate Unfunded
Vested Liability in excess of $500,000 shall be filed pursuant to
Title IV of ERISA by the Borrower; or the PBGC shall institute
proceedings under Title IV of ERISA to terminate or cause a trustee to
be appointed to administer any such Employee Benefit Plan or Employee
Benefit Plans or a proceeding shall be instituted by a fiduciary of any
such Employee Benefit Plan or Employee Benefit Plans to enforce Section
515 of ERISA and such proceeding shall not have been dismissed within 30
days thereafter; or a condition shall exist by reason of which the PBGC
would be entitled to obtain a decree adjudicating that such Employee
Benefit Plan or Employee Benefit Plans must be terminated;
(m) the Borrower shall be enjoined, restrained or in any way
prevented by the order of any court or any administrative or regulatory
agency from conducting any material part of its business and such order
shall continue in effect for more than sixty (60) days;
(n) (i) there shall occur and be continuing a default under the
Unitil Contract or any of the Acquisition Documents that is reasonably
expected to have a materially adverse effect on the assets, financial
condition or prospects of the Borrower or the Borrower's ability to
perform its obligations under the Loan Documents, the Unitil Contract or
any of the Acquisition Documents, or (ii) the Unitil Contract shall be
terminated by any party thereto;
(o) there shall occur the loss, suspension or revocation of, or
failure to renew, any license or permit now held or hereafter acquired
by the Borrower if such loss, suspension, revocation or failure to renew
could reasonably be expected to have a material adverse effect on the
business or financial condition of the Borrower;
(p) Bangor shall at any time, legally or beneficially own less
than 100% of the capital stock of the Borrower, as adjusted pursuant to
any stock split, stock dividend or recapitalization or reclassification
of the capital of the Borrower; or
(q) the Borrower shall fail to purchase within thirty (30) days an
interest rate cap or swap or fail to pay down the Term Loan pursuant to
Section 6.17;
then, and in any such event, so long as the same may be continuing, the Agent
may, and upon the request of the Majority Banks shall, by notice in writing
to the Borrower declare all amounts owing with respect to this Agreement, the
Term Notes and the other Loan Documents to be, and they shall thereupon
forthwith become, immediately due and payable without presentment, demand,
protest or other notice of any kind, other than notice expressly required
hereunder, all of which are hereby expressly waived by the Borrower; PROVIDED
that in the event of any Event of Default specified in Section 10.1(g),
10.1(h) or 10.1(n)(ii), all such amounts shall become immediately due and
payable automatically and without any requirement of notice from the Agent or
any Bank.
Section 10.2. REMEDIES.
In case any one or more of the Events of Default shall have occurred and
be continuing, and whether or not the Banks shall have accelerated the
maturity of the Term Loan pursuant to Section 10.1, each Bank, if owed any
amount with respect to the Term Loan may, with the consent of the Majority
Banks but not otherwise, proceed to protect and enforce its rights by suit in
equity, action at law or other appropriate proceeding, whether for the
specific performance of any covenant or agreement contained in this Credit
Agreement and the other Loan Documents or any instrument pursuant to which
the Obligations to such Bank are evidenced, including as permitted by
applicable law the obtaining of the EX PARTE appointment of a receiver, and,
if such amount shall have become due, by declaration or otherwise, proceed to
enforce the payment thereof or any other legal or equitable right of such
Bank. No remedy herein conferred upon any Bank or the Agent or the holder of
any Term Note is intended to be exclusive of any other remedy and each and
every remedy shall be cumulative and shall be in addition to every other
remedy given hereunder or now or hereafter existing at law or in equity or by
statute or any other provision of law.
Section 10.3. DISTRIBUTION OF COLLATERAL PROCEEDS.
In the event that, following the occurrence or during the continuance of
any Event of Default, the Agent or any Bank, as the case may be, receives any
monies in connection with the enforcement of any the Security Documents, or
otherwise with respect to the realization upon any of the Collateral, such
monies shall be distributed for application as follows:
(a) First, to the payment of, or (as the case may be) the
reimbursement of the Agent for or in respect of all reasonable costs,
expenses, disbursements and losses which shall have been incurred or
sustained by the Agent in connection with the collection of such monies
by the Agent, for the exercise, protection or enforcement by the Agent
of all or any of the rights, remedies, powers and privileges of the
Agent and the Banks under this Agreement or any of the other Loan
Documents or in respect of the Collateral or in support of any provision
of adequate indemnity to the Agent against any taxes or liens which by
law shall have, or may have, priority over the rights of the Agent to
such monies;
(b) Second, to all other Obligations then due and payable to be
shared PRO RATA among the Banks in accordance with their respective Loan
Percentages of the outstanding Term Loan; PROVIDED, HOWEVER, that
distributions shall be made (i) PARI PASSU among Obligations with
respect to the Agent's fee payable pursuant to Section 3.1 and all other
Obligations and (ii) with respect to each type of Obligation owing to
the Banks, such as interest, principal, fees and expenses, among the
Banks PRO RATA;
(c) Third, upon payment and satisfaction in full or other
provisions for payment in full satisfactory to the Banks and the Agent
of all of the Obligations, to the payment of any obligations required to
be paid pursuant to Section 9-504(1)(c) of the Uniform Commercial Code
of the State of New York; and
(d) Fourth, the excess, if any, shall be returned to the Borrower
or to such other Persons as are entitled thereto.
Section 11. SETOFF.
Regardless of the adequacy of any collateral, during the continuance of
any Event of Default, any deposits or other sums credited by or due from any
of the Banks to the Borrower and any securities or other property of the
Borrower in the possession of such Bank may be applied to or set off by such
Bank against the payment of Obligations then due and payable. Each of the
Banks agrees with each other Bank that if such Bank shall receive from the
Borrower, whether by voluntary payment, exercise of the right of setoff,
counterclaim, cross action, enforcement of the claim evidenced by the Term
Notes held by, such Bank by proceedings against the Borrower at law or in
equity or by proof thereof in bankruptcy, reorganization, liquidation,
receivership or similar proceedings, or otherwise, and shall retain and apply
to the payment of the Term Notes held by, such Bank any amount in excess of
its ratable portion of the payments received by all of the Banks with respect
to the Term Notes held by all of the Banks, such Bank will make such
disposition and arrangements with the other Banks with respect to such
excess, either by way of distribution, PRO TANTO assignment of claims,
subrogation or otherwise as shall result in each Bank receiving in respect of
the Term Notes held by it, its proportionate payment as contemplated by this
Agreement; PROVIDED that if all or any part of such excess payment is
thereafter recovered from such Bank, such disposition and arrangements shall
be rescinded and the amount restored to the extent of such recovery, but,
without interest. Such Bank shall notify the Borrower and the Agent and the
other Banks promptly after exercising any right of setoff.
Section 12. THE AGENT.
Section 12.1. AUTHORIZATION.
(a) The Agent is authorized to take such action on behalf of each
of the Banks and to exercise all such powers as are hereunder and under
any of the other Loan Documents and any related documents delegated to
the Agent, together with such powers as are reasonably incident thereto,
PROVIDED that no duties or responsibilities not expressly assumed herein
or therein shall be implied to have been assumed by the Agent.
(b) The relationship between the Agent and each of the Banks is
that of an independent contractor. The use of the term "Agent" is for
convenience only and is used to describe, as a form of convention, the
independent contractual relationship between the Agent and each of the
Banks. Nothing contained in this Agreement nor the other Loan Documents
shall be construed to create an agency, trust or other fiduciary
relationship between the Agent and any of the Banks.
(c) As an independent contractor empowered by the Banks to
exercise certain rights and perform certain duties and responsibilities
hereunder and under the other Loan Documents, the Agent is nevertheless
a "representative" of the Banks, as that term is defined in Article 1 of
the Uniform Commercial Code, for purposes of actions for the benefit of
the Banks and the Agent with respect to all collateral security and
guaranties contemplated by the Loan Documents. Such actions include the
designation of the Agent as "secured party", "mortgagee" or the like on
all financing statements and other documents and instruments, whether
recorded or otherwise, relating to the attachment, perfection, priority
or enforcement of any security interests, mortgages or deeds of trust in
collateral security intended to secure the payment or performance of any
of the Obligations, all for the benefit of the Banks and the Agent.
Section 12.2. EMPLOYEES AND AGENTS.
The Agent may exercise its powers and execute its duties by or through
employees or agents and shall be entitled to take, and to rely on, advice of
counsel concerning all matters pertaining to its rights and duties under this
Agreement and the other Loan Documents.
Section 12.3. NO LIABILITY.
Neither the Agent nor any of its shareholders, directors, officers or
employees nor any other Person assisting them in their duties nor any agent
or employee thereof, shall be liable for any waiver, consent or approval
given or any action taken, or omitted to be taken, in good faith by it or
them hereunder or under any of the other Loan Documents, or in connection
herewith or therewith, or be responsible for the consequences of any
oversight or error of judgment whatsoever, except that the Agent or such
other Person, as the case may be, may be liable for losses due to its willful
misconduct or gross negligence.
Section 12.4. NO REPRESENTATIONS.
The Agent shall not be responsible for the execution or validity or
enforceability of this Agreement, the Term Notes, any of the other Loan
Documents or any instrument at any time constituting, or intended to
constitute, collateral security for the Term Notes, or for the value of any
such collateral security or for the validity, enforceability or
collectability of any such amounts owing with respect to the Term Notes, or
for any recitals or statements, warranties or representations made herein or
in any of the other Loan Documents or in any certificate or instrument
hereafter furnished to it by or on behalf of the Borrower or be bound to
ascertain or inquire as to the performance or observance of any of the terms,
conditions, covenants or agreements herein or in any instrument at any time
constituting, or intended to constitute, collateral security for the Term
Notes or to inspect any of the properties, books or records of the Borrower.
The Agent shall not be bound to ascertain whether any notice, consent, waiver
or request delivered to it by the Borrower or any holder of any of the Term
Notes shall have been duly authorized or is true, accurate and complete. The
Agent has not made nor does it now make any representations or warranties,
express or implied, nor does it assume any liability to the Banks, with
respect to the credit worthiness or financial conditions of the Borrower.
Each Bank acknowledges that it has, independently and without reliance upon
the Agent or any other Bank, and based upon such information and documents as
it has deemed appropriate, made its own credit analysis and decision to enter
into this Agreement.
Section 12.5. PAYMENTS.
(a) PAYMENTS TO AGENT. A payment by the Borrower to the Agent
hereunder or any of the other Loan Documents for the account of any Bank
shall constitute a payment to such Bank. The Agent agrees promptly to
distribute to each Bank such Bank's pro rata share of payments received
by the Agent for the account of the Banks except as otherwise expressly
provided herein or in any of the other Loan Documents.
(b) DISTRIBUTION BY AGENT. If in the opinion of the Agent the
distribution of any amount received by it in such capacity hereunder,
under the Term Notes or under any of the other Loan Documents might
involve it in liability, it may refrain from making distribution until
its right to make distribution shall have been adjudicated by a court of
competent jurisdiction. If a court of competent jurisdiction shall
adjudge that any amount received and distributed by the Agent is to be
repaid, each Person to whom any such distribution shall have been made
shall either repay to the Agent its proportionate share of the amount so
adjudged to be repaid or shall pay over the same in such manner and to
such Persons as shall be determined by such court.
(c) DELINQUENT BANKS. Notwithstanding anything to the contrary
contained in this Agreement or any of the other Loan Documents, any Bank
that fails (a) to make available to the Agent its PRO RATA share of the
Term Loan or (b) to comply with the provisions of Section 11 with
respect to making dispositions and arrangements with the other Banks,
where such Bank's share of any payment received, whether by setoff or
otherwise, is in excess of its PRO RATA share of such payments due and
payable to all of the Banks, in each case as, when and to the full
extent required by the provisions of this Agreement, shall be deemed
delinquent (a "Delinquent Bank") and shall be deemed a Delinquent Bank
until such time as such delinquency is satisfied. A Delinquent Bank
shall be deemed to have assigned any and all payments due to it from the
Borrower, whether on account of the outstanding Term Loan interest, fees
or otherwise, to the remaining nondelinquent Banks for application to,
and reduction of, their respective PRO RATA shares of the outstanding
Term Loan. The Delinquent Bank hereby authorizes the Agent to
distribute such payments to the nondelinquent Banks in proportion to
their respective PRO RATA shares of the outstanding Term Loan. A
Delinquent Bank shall be deemed to have satisfied in full a delinquency
when and if, as a result of application of the assigned payments to the
outstanding Term Loan of the nondelinquent Banks, the Banks' respective
PRO RATA shares of all outstanding Loans have returned to those in
effect immediately prior to such delinquency and without giving effect
to the nonpayment causing such delinquency.
Section 12.6. HOLDERS OF NOTES.
The Agent may deem and treat the payee of any Note as the absolute owner
or purchaser thereof for all purposes hereof until it shall have been
furnished in writing with a different name by such payee or by a subsequent
holder, assignee or transferee.
Section 12.7. INDEMNITY.
The Banks ratably agree hereby to indemnify and hold harmless the Agent
and its affiliates from and against any and all claims, actions and suits
(whether groundless or otherwise), losses, damages, costs, expenses
(including any expenses for which the Agent or such affiliate has not been
reimbursed by the Borrower as required by Section 13), and liabilities of
every nature and character arising out of or related to this Credit
Agreement, the Term Notes, or any of the other Loan Documents or the
transactions contemplated or evidenced hereby or thereby, or the Agent's
actions taken hereunder or thereunder, except to the extent that any of the
same shall be directly caused by the Agent's willful misconduct or gross
negligence.
Section 12.8. AGENT AS BANK.
In its individual capacity, BKB shall have the same obligations and the
same rights, powers and privileges in respect to its Loan Percentage and the
Term Loan made by it, and as the holder of a Term Note, as it would have were
it not also the Agent.
Section 12.9. RESIGNATION.
The Agent may resign at any time by giving sixty (60) days prior written
notice thereof to the Banks and the Borrower. Upon any such resignation, the
Majority Banks shall have the right to appoint a successor Agent. Unless an
Event of Default shall have occurred and be continuing, such successor Agent
shall be reasonably acceptable to the Borrower. If no successor Agent shall
have been so appointed by the Majority Banks and approved by the Borrower and
shall have accepted such appointment within thirty (30) days after the
retiring Agent's giving of notice of resignation, then the retiring Agent
may, on behalf of the Banks, appoint a successor Agent, which shall be a
financial institution having a rating of not less than A or its equivalent by
Standard & Poor's Corporation. 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 shall be discharged from
its duties and obligations hereunder. After any retiring Agent's
resignation, the provisions of this Agreement and the other Loan Documents
shall continue in effect for its benefit in respect of any actions taken or
omitted to be taken by it while it was acting as Agent.
Section 12.10. NOTIFICATION OF DEFAULTS AND EVENTS OF DEFAULT.
Each Bank hereby agrees that, upon learning of the existence of a
Default or an Event of Default, it shall promptly notify the Agent thereof.
The Agent hereby agrees that upon receipt of any notice under this Section
12.10 it shall promptly notify the other Banks of the existence of such
Default or Event of Default.
Section 12.11. DUTIES IN THE CASE OF ENFORCEMENT.
In case one of more Events of Default have occurred and shall be
continuing, and whether or not acceleration of the Obligations shall have
occurred, the Agent shall, if (a) so requested by the Majority Banks and
(b) the Banks have provided to the Agent such additional indemnities and
assurances against expenses and liabilities as the Agent may reasonably
request, proceed to enforce the provisions of the Security Documents
authorizing the sale or other disposition of all or any part of the
Collateral and exercise all or any such other legal and equitable and other
rights or remedies as it may have in respect of such Collateral. The
Majority Banks may direct the Agent in writing as to the method and the
extent of any such sale or other disposition, the Banks hereby agreeing to
indemnify and hold the Agent, harmless from all liabilities incurred in
respect of all actions taken or omitted in accordance with such directions,
PROVIDED that the Agent need not comply with any such direction to the extent
that the Agent reasonably believes the Agent's compliance with such direction
to be unlawful or commercially unreasonable in any applicable jurisdiction.
Section 13. EXPENSES AND INDEMNIFICATION.
Section 13.1. EXPENSES.
The Borrower agrees to pay (a) the reasonable costs of producing and
reproducing this Agreement, the other Loan Documents and the other agreements
and instruments mentioned herein, (b) any taxes payable by the Agent or any
of the Banks on or with respect to the transactions contemplated by this
Agreement in accordance with Section 3.3 (the Borrower hereby agreeing to
indemnify the Agent and each Bank with respect thereto), (c) the reasonable
fees, expenses and disbursements of the Agent's Special Counsel or any local
counsel to the Agent incurred in connection with the preparation,
syndication, administration or interpretation of the Loan Documents and other
instruments mentioned herein, each closing hereunder, any amendments,
modifications, approvals, consents or waivers hereto or hereunder, or the
cancellation of any Loan Document upon payment in full in cash of all of the
Obligations or pursuant to any terms of such Loan Document for providing for
such cancellation, (d) the reasonable out-of-pocket fees, expenses and
disbursements of the Agent or any of its affiliates incurred by the Agent or
such affiliate in connection with the preparation, administration or
interpretation of the Loan Documents and other instruments mentioned herein,
(e) any reasonable out-of-pocket fees, costs, expenses and bank charges,
including bank charges for returned checks, incurred by the Agent in
establishing, maintaining or handling agency accounts, the Lockbox Account,
Cash Collateral Account and other accounts for the collection of any of the
Collateral, (f) all reasonable out-of-pocket expenses (including without
limitation reasonable attorneys' fees and costs, and reasonable consulting,
accounting, appraisal, investment banking and similar professional fees and
charges) incurred by any Bank or the Agent in connection with (i) the
enforcement of or preservation of rights under any of the Loan Documents
against the Borrower or the administration thereof after the occurrence of a
Default or Event of Default and (ii) any litigation, proceeding or dispute
arising hereunder or in connection with any Bank's or the Agent's
relationship with the Borrower hereunder; PROVIDED that all reasonable out-of-
pocket expenses (including without limitation reasonable attorneys' fees and
costs, and reasonable consulting, accounting, appraisal, investment banking
and similar professional fees and charges) incurred by any Bank or the Agent
in connection with (A) the enforcement of or preservation of rights under any
of the Loan Documents against the Borrower or the administration thereof
after the occurrence of a Default or Event of Default and (B) any litigation,
proceeding or dispute whether arising hereunder or otherwise, in any way
related to any Bank's or the Agent's relationship with the Borrower hereunder
and (g) all reasonable out-of-pocket fees, expenses and disbursements of the
Agent incurred in connection with UCC searches and UCC filings.
Notwithstanding the foregoing, the Borrower shall have no obligation
hereunder to the Agent or any Bank with respect to any costs or expenses
arising from the gross negligence or willful misconduct of the Agent or such
Bank, as the case may be.
Section 13.2. INDEMNIFICATION.
The Borrower agrees to indemnify and hold harmless the Agent, the Banks
and their affiliates from and against any and all liabilities, losses,
damages and expense of every nature and character resulting from any and all
claims, actions and suits whether groundless or otherwise, arising out of
this Agreement or any of the other Loan Documents or the transactions
contemplated hereby including, without limitation, (a) any actual or proposed
use by the Borrower of the proceeds of the Term Loan, (b) the reversal or
withdrawal of any provisional credits granted by the Agent upon the transfer
of funds from the Lock Box, bank agency or concentration accounts or in
connection with the provisional honoring of checks or other items, (c) the
Borrower entering into or performing this Agreement or any of the other Loan
Documents or (d) with respect to the Borrower and its properties and assets,
the violation of any Environmental Law, the presence, disposal, escape,
seepage, leakage, spillage, discharge, emission, release or threatened
release of any Hazardous Substances or any action, suit, proceeding or
investigation brought or threatened with respect to any Hazardous Substances
(including, but not limited to, claims with respect to wrongful death,
personal injury or damage to property), in each case including, without
limitation, the reasonable fees and disbursements of counsel incurred in
connection with any such investigation, litigation or other proceeding,
except for the gross negligence or willful misconduct of the party
indemnified. In litigation, or the preparation therefor, the Banks and the
Agent shall be entitled to select their own counsel and, in addition to the
foregoing indemnity, the Borrower agrees to pay promptly the reasonable fees
and expenses of such counsel. Notwithstanding anything to the contrary
herein, the Borrower shall not be responsible for (i) the cost of more than
one counsel for the Agent and its affiliates, and any Bank (that is not the
Agent) and its affiliates, respectively, or (ii) settlements, waivers or
releases made without Borrower's consent. If, and to the extent that the
obligations of the Borrower under this Section 13.2 are unenforceable for any
reason, the Borrower hereby agrees to make the maximum contribution to the
payment in satisfaction of such obligations which is permissible under
applicable law.
Section 13.3 SURVIVAL.
The covenants contained in this Section 13 shall survive payment or
satisfaction in full of all other Obligations.
Section 14. TREATMENT OF CERTAIN CONFIDENTIAL INFORMATION.
Section 14.1. SHARING OF INFORMATION WITH SECTION 20 SUBSIDIARY.
The Borrower acknowledges that from time to time financial advisory,
investment banking and other services may be offered or provided to the
Borrower in connection with this Agreement or otherwise, by a Section 20
Subsidiary. The Borrower hereby authorizes (a) such Section 20 Subsidiary to
share with the Agent and each Bank any information delivered to such
Section 20 Subsidiary by the Borrower and (b) the Agent and each Bank to
share with such Section 20 Subsidiary any information delivered to the Agent
or such Bank by the Borrower pursuant to this Agreement, or in connection
with the decision of such Bank to enter into this Agreement; it being
understood, in each case, that any such Section 20 Subsidiary receiving such
information shall be bound by the confidentiality provisions of this
Agreement. Such authorization shall survive the payment and satisfaction in
full of all of Obligations.
Section 14.2. CONFIDENTIALITY.
Each of the Banks and the Agent agrees, on behalf of itself and each of
its affiliates, directors, officers, employees and representatives, to use
reasonable precautions to keep confidential, in accordance with their
customary procedures for handling confidential information of the same nature
and in accordance with safe and sound banking practices, any non-public
information supplied to it by the Borrower pursuant to this Agreement that is
identified by such Person as being "confidential" or "for internal use only"
at the time the same is delivered to the Banks or the Agent, provided that
nothing herein shall limit the disclosure of any such information (a) after
such information shall have become public other than through a violation of
this Section 14, (b) to the extent required by statute, rule, regulation or
judicial process, (c) to counsel for any of the Banks or the Agent, (d) to
bank examiners or any other regulatory authority having jurisdiction over any
Bank or the Agent, or to auditors or accountants, (e) to the Agent, any Bank
or any Section 20 Subsidiary, (f) if required pursuant to legal process in
connection with any litigation to which any one or more of the Banks, the
Agent or any Section 20 Subsidiary is a party, or in connection with the
enforcement of rights or remedies hereunder or under any other Loan Document,
(g) to a Subsidiary or affiliate of such Bank as provided in Section 14.1 or
(h) to any assignee or participant (or prospective assignee or participant)
so long as such assignee or participant agrees to be bound by the provisions
of Section 16.6.
Section 14.3. PRIOR NOTIFICATION.
Unless specifically prohibited by applicable law or court order, each of
the Banks and the Agent shall, prior to disclosure thereof, notify the
Borrower of any request for disclosure of any such non-public information by
any governmental agency or representative thereof (other than any such
request in connection with an examination of the financial condition of such
Bank by such governmental agency) or pursuant to legal process.
Section 14.4. OTHER.
In no event shall any Bank or the Agent be obligated or required to
return any materials furnished to it or any Section 20 Subsidiary by the
Borrower. The obligations of each Bank under this Section 14 shall supersede
and replace the obligations of such Bank under any confidentiality letter in
respect of this financing signed and delivered by such Bank to the Borrower
prior to the date hereof, shall be binding upon any assignee of, or purchaser
of any participation in, any interest in any of the Term Loan from any Bank
and shall survive for a period of two (2) years beyond the termination of
this Agreement.
Section 15. SURVIVAL OF COVENANTS, ETC.
All covenants, agreements, representations and warranties made herein,
in the Term Notes, in any of the other Loan Documents or in any documents or
other papers delivered by or on behalf of Bangor or the Borrower pursuant
hereto shall be deemed to have been relied upon by the Banks and the Agent,
notwithstanding any investigation heretofore or hereafter made by any of
them, and shall survive the making by the Banks of the Term Loan, as herein
contemplated, and shall continue in full force and effect so long as any
amount due under this Agreement or the Term Notes or any of the other Loan
Documents remains outstanding or any Bank has any obligation to make the Term
Loan, and for such time as may be otherwise expressly specified in this
Agreement. All statements contained in any certificate or other paper
delivered to any Bank or the Agent at any time by or on behalf of the
Borrower pursuant hereto or in connection with the transactions contemplated
hereby shall constitute representations and warranties by the Borrower
hereunder.
Section 16. ASSIGNMENT AND PARTICIPATION.
Section 16.1. CONDITIONS TO ASSIGNMENT BY BANKS.
Except as provided herein, each Bank may assign to one or more Eligible
Assignees all or a portion of its interests, rights and obligations under
this Agreement (including all or a portion of its Term Note); provided that
(a) each of the Agent and, unless an Event of Default shall have occurred and
be continuing, the Borrower shall have given its prior written consent to
such assignment, which consent, in the case of the Borrower, will not be
unreasonably withheld, (b) each such assignment shall be of a constant, and
not a varying, percentage of all the assigning Bank's rights and obligations
under this Agreement, (c) each assignment shall be in an amount of at least
$5,000,000, and each Bank shall retain, free of any such assignment, an
amount of not less than $5,000,000, and (d) the parties to such assignment
shall execute and deliver to the Agent, for recording in the Register (as
hereinafter defined), an Assignment and Acceptance, substantially in the form
of EXHIBIT F hereto (an "Assignment and Acceptance"), together with any Term
Notes subject to such assignment. Upon such execution, delivery, acceptance
and recording, from and after the effective date specified in each Assignment
and Acceptance, which effective date shall be at least five (5) Business Days
after the execution thereof, (i) the assignee thereunder shall be a party
hereto and, to the extent provided in such Assignment and Acceptance, have
the rights and obligations of a Bank hereunder, and (ii) the assigning Bank
shall, to the extent provided in such assignment and upon payment to the
Agent of the registration fee referred to in Section 16.3, be released from
its obligations under this Agreement.
Section 16.2. CERTAIN REPRESENTATIONS AND WARRANTIES; LIMITATIONS;
COVENANTS.
By executing and delivering an Assignment and Acceptance, the parties to
the assignment thereunder confirm to and agree with each other and the other
parties hereto as follows:
(a) other than the representation and warranty that it is the
legal and beneficial owner of the interest being assigned thereby free
and clear of any adverse claim, the assigning Bank makes no
representation or warranty, express or implied, and assumes no
responsibility with respect to any statements, warranties or
representations made in or in connection with this Agreement or the
execution, legality, validity, enforceability, genuineness, sufficiency
or value of this Agreement, the other Loan Documents or any other
instrument or document furnished pursuant hereto or the attachment,
perfection or priority of any security interest or mortgage,
(b) the assigning Bank makes no representation or warranty and
assumes no responsibility with respect to the financial condition of the
Borrower or any other Person primarily or secondarily liable in respect
of any of the Obligations, or the performance or observance by the
Borrower or any other Person primarily or secondarily liable in respect
of any of the Obligations of any of their obligations under this
Agreement or any of the other Loan Documents or any other instrument or
document furnished pursuant hereto or thereto;
(c) such assignee confirms that it has received a copy of this
Agreement, together with copies of the most recent financial statements
referred to in Section Section 5.4 and 6.4 and such other documents and
information as it has deemed appropriate to make its own credit analysis
and decision to enter into such Assignment and Acceptance;
(d) such assignee will, independently and without reliance upon
the assigning Bank, the Agent or any other Bank and based on such
documents and information as it shall deem appropriate at the time,
continue to make its own credit decisions in taking or not taking action
under this Agreement;
(e) such assignee represents and warrants that it is an Eligible
Assignee;
(f) such assignee appoints and authorizes the Agent to take such
action as agent on its behalf and to exercise such powers under this
Agreement and the other Loan Documents as are delegated to the Agent by
the terms hereof or thereof, together with such powers as are reasonably
incidental thereto;
(g) such assignee agrees that it will perform in accordance with
their terms all of the obligations that by the terms of this Agreement
are required to be performed by it as a Bank; and
(h) such assignee represents and warrants that it is legally
authorized to enter into such Assignment and Acceptance.
Section 16.3. REGISTER.
The Agent shall maintain a copy of each Assignment and Acceptance
delivered to it and a register or similar list (the "Register") for the
recordation of the names and addresses of the Banks and the Loan Percentage
of, and principal amount of Term Loan owing to the Banks from time to time.
The entries in the Register shall be conclusive, in the absence of manifest
error, and the Borrower, the Agent and the Banks may treat each Person whose
name is recorded in the Register as a Bank hereunder for all purposes of this
Agreement. The Register shall be available for inspection by the Borrower
and the Banks at any reasonable time and from time to time upon reasonable
prior notice. Upon each such recordation, the assigning Bank agrees to pay to
the Agent a registration fee in the sum of $3,500.
Section 16.4. NEW NOTES.
Upon its receipt of an Assignment and Acceptance executed by the parties
to such assignment, together with each Term Note subject to such assignment,
the Agent shall (a) record the information contained therein in the Register,
and (b) give prompt notice thereof to the Borrower and the Banks (other than
the assigning Bank). Within five (5) Business Days after receipt of such
notice, the Borrower, at its own expense, shall execute and deliver to the
Agent, in exchange for each surrendered Term Note, a new Term Note to the
order of such Eligible Assignee in an amount equal to the amount assumed by
such Eligible Assignee pursuant to such Assignment and Acceptance and, if the
assigning Bank has retained some portion of its obligations hereunder, a new
Term Note to the order of the assigning Bank in an amount equal to the amount
retained by it hereunder. Such new Term Notes shall provide that they are
replacements for the surrendered Term Notes, shall be in an aggregate
principal amount equal to the aggregate principal amount of the surrendered
Term Notes, shall be dated the effective date of such in Assignment and
Acceptance and shall otherwise be substantially the form of the assigned Term
Notes. The surrendered Term Notes shall be cancelled and returned to the
Borrower.
Section 16.5. PARTICIPATIONS.
Each Bank may sell participations to one or more banks or other entities
in all or a portion of such Bank's rights and obligations under this
Agreement and the other Loan Documents; provided that (a) each such
participation shall be in an amount of not less than $1,000,000, (b) any such
sale or participation shall not affect the rights and duties of the selling
Bank hereunder to the Borrower (c) the only rights granted to the participant
pursuant to such participation arrangements with respect to waivers,
amendments or modifications of the Loan Documents shall be the rights to
approve waivers, amendments or modifications that would reduce the principal
of or the interest rate on the Term Loan, extend the term or increase the
amount of the Term Note of such Bank as it relates to such participant, or
extend any regularly scheduled payment date for principal or interest, and
(d) the Borrower shall not be obligated to pay any such Bank any greater
amount pursuant to Section 3.3, Section 3.6, Section 3.9 or Section 3.10 in
respect of the amount of the participation transferred by such transferor
Bank to such participant than had no such transfer occurred. The Borrower
agrees that, in the event that Chase or any Chase Bank, in their respective
capacities as such, acquires a participation in any Term Loan (the portion
thereof subject to such participation, a "Participated Term Loan") and, as a
result of any applicable subordination arrangements, any principal or
interest payments that would otherwise be applicable to such Participated
Term Loan are not paid to the relevant participant on the date of receipt of
such payment by the seller of such participation, then, effective on such
date (a) any such deferred principal shall thereafter bear interest at 2%
above the Base Rate and (b) any such deferred interest shall be added to the
principal of such Participated Term Loan and shall thereafter bear interest
at 2% above the Base Rate. Notwithstanding anything to the contrary in this
Agreement, the Borrower unconditionally agrees to pay to the relevant
participant any such deferred principal payments and capitalized amounts, and
accrued interest thereon calculated as provided above, on demand, which
demand may be made by the relevant participant once such participant is
entitled to receive cash payments in respect of such participation in
accordance with the relevant subordination arrangements.
Section 16.6. DISCLOSURE.
The Borrower agrees that in addition to disclosures made in accordance
with standard and customary banking practices any Bank may disclose
information obtained by such Bank pursuant to this Agreement to assignees or
participants and potential assignees or participants hereunder; provided that
such assignees or participants or potential assignees or participants shall
agree (a) to treat in confidence such information unless such information
otherwise becomes public knowledge, (b) not to disclose such information to a
third party, except as required by law or legal process and (c) not to make
use of such information for purposes of transactions unrelated to such
contemplated assignment or participation.
Section 16.7. ASSIGNEE OR PARTICIPANT AFFILIATED WITH THE BORROWER.
If any assignee Bank is an Affiliate of the Borrower, then any such
assignee Bank shall have no right to vote as a Bank hereunder or under any of
the other Loan Documents for purposes of granting consents or waivers or for
purposes of agreeing to amendments or other modifications to any of the Loan
Documents or for purposes of making requests to the Agent pursuant to Section
10.1, and the determination of the Majority Banks shall for all purposes of
this Agreement and the other Loan Documents be made without regard to such
assignee Bank's interest in the Term Loan. If any Bank sells a participating
interest in the Term Loan to a participant, and such participant is the
Borrower or an Affiliate of the Borrower, then such transferor Bank shall
promptly notify the Agent of the sale of such participation. A transferor
Bank shall have no right to vote as a Bank hereunder or under any of the
other Loan Documents for purposes of granting consents or waivers or for
purposes of agreeing to amendments or modifications to any of the Loan
Documents or for purposes of making requests to the Agent pursuant to Section
10.1 to the extent that such participation is beneficially owned by the
Borrower or any Affiliate of the Borrower, and the determination of the
Majority Banks shall for all purposes of this Agreement and the other Loan
Documents be made without regard to the interest of such transferor Bank in
the Term Loan to the extent of such participation.
Section 16.8. MISCELLANEOUS ASSIGNMENT PROVISIONS.
Any assigning Bank shall retain its rights to be indemnified pursuant to
Section 13 with respect to any claims or actions arising prior to the date of
such assignment. If any assignee Bank is not incorporated under the laws of
the United States of America or any state thereof, it shall, prior to the
date on which any interest or fees are payable hereunder or under any of the
other Loan Documents for its account, deliver to the Borrower and the Agent
certification as to its exemption from deduction or withholding of any United
States federal income taxes. Anything contained in this Section 16 to the
contrary notwithstanding, any Bank may at any time pledge all or any portion
of its interest and rights under this Agreement (including all or any portion
of its Term Note) to any of the twelve Federal Reserve Banks organized under
Section 4 of the Federal Reserve Act, 12 U.S.C. Section 341. No such pledge
or the enforcement thereof shall release the pledgor Bank from its
obligations hereunder or under any of the other Loan Documents.
Section 16.9. ASSIGNMENT BY BORROWER.
The Borrower shall not assign or transfer any of its rights or
obligations under any of the Loan Documents without the prior written consent
of each of the Banks.
Section 17. NOTICES, ETC.
Except as otherwise expressly provided in this Agreement, all notices
and other communications made or required to be given pursuant to this
Agreement or the Term Note shall be in writing and shall be delivered in
hand, mailed by United States registered or certified first class mail,
postage prepaid, sent by overnight courier, or sent by telegraph, telecopy or
facsimile and confirmed by delivery via courier or postal service, addressed
as follows:
(a) if to the Borrower, at 33 State Street, Bangor, Maine 04402,
Attention: General Counsel, telecopy: (207) 990-6963 or at such other
address for notice as the Borrower shall last have furnished in writing
to the Person giving the notice;
(b) if to the Agent, at 100 Federal Street, Boston, Massachusetts
02110, USA, Attention: Michael M. Parker, Managing Director, telecopy:
(617) 434-3652 or such other address for notice as the Agent shall last
have furnished in writing to the Person giving the notice; and
(c) if to any Bank, at such Bank's address set forth on SCHEDULE 1
hereto, or such other address for notice as such Bank shall have last
furnished in writing to the Person giving the notice.
Any such notice or demand shall be deemed to have been duly given or
made and to have become effective (i) if delivered by hand, overnight courier
or facsimile to a responsible officer of the party to which it is directed,
at the time of the receipt thereof by such officer or the sending of such
facsimile along with receipt of confirmation and (ii) if sent by registered
or certified first-class mail, postage prepaid, on the third (3rd) Business
Day following the mailing thereof.
Section 18. GOVERNING LAW.
THIS AGREEMENT AND, EXCEPT AS OTHERWISE SPECIFICALLY PROVIDED THEREIN,
EACH OF THE OTHER LOAN DOCUMENTS ARE CONTRACTS UNDER THE LAWS OF THE STATE OF
NEW YORK AND SHALL FOR ALL PURPOSES BE CONSTRUED IN ACCORDANCE WITH AND
GOVERNED BY THE LAWS OF SAID STATE OF NEW YORK (EXCLUDING THE LAWS APPLICABLE
TO CONFLICTS OR CHOICE OF LAW OTHER THAN NEW YORK GENERAL OBLIGATIONS LAW
Section 5-1401). THE BORROWER AGREES THAT ANY SUIT FOR THE ENFORCEMENT OF
THIS CREDIT AGREEMENT OR ANY OF THE OTHER LOAN DOCUMENTS MAY BE BROUGHT IN
THE COURTS OF THE STATE OF NEW YORK OR ANY FEDERAL COURT SITTING THEREIN AND
CONSENTS TO THE NONEXCLUSIVE JURISDICTION OF SUCH COURT AND SERVICE OF
PROCESS IN ANY SUCH SUIT BEING MADE UPON THE BORROWER BY MAIL AT THE ADDRESS
SPECIFIED IN Section 17. THE BORROWER HEREBY WAIVES ANY OBJECTION THAT IT
MAY NOW OR HEREAFTER HAVE TO THE VENUE OF ANY SUCH SUIT OR ANY SUCH COURT OR
THAT SUCH SUIT IS BROUGHT IN AN INCONVENIENT COURT.
Section 19. HEADINGS.
The captions in this Agreement are for convenience of reference only and
shall not define or limit the provisions hereof.
Section 20. COUNTERPARTS.
This Agreement and any amendment hereof may be executed in several
counterparts and by each party on a separate counterpart, each of which when
executed and delivered shall be an original, and all of which together shall
constitute one instrument. In proving this Agreement it shall not be
necessary to produce or account for more than one such counterpart signed by
the party against whom enforcement is sought.
Section 21. ENTIRE AGREEMENT, ETC.
The Loan Documents and any other documents executed in connection
herewith or therewith express the entire understanding of the parties with
respect to the transactions contemplated hereby. Neither this Agreement nor
any term hereof may be changed, waived, discharged or terminated, except as
provided in Section 23.
Section 22. WAIVER OF JURY TRIAL.
Each of the Agent, the Banks and the Borrower hereby waive its right to
a jury trial with respect to any action or claim arising out of any dispute
in connection with this Agreement, the Term Notes or any of the other Loan
Documents, any rights or obligations hereunder or thereunder or the
performance of which rights and obligations. Except as prohibited by law,
all parties to this Agreement hereby waive any right they may have to claim
or recover in any litigation referred to in the preceding sentence any
special, exemplary, punitive or consequential damages or any damages other
than, or in addition to, actual damages. The Borrower (a) certifies that no
representative, agent or attorney of any Bank or the Agent has represented,
expressly or otherwise, that such Bank or the Agent would not, in the event
of litigation, seek to enforce the foregoing waivers and (b) acknowledges
that the Agent and the Banks have been induced to enter into this Agreement,
the other Loan Documents to which it is a party by, among other things, the
waivers and certifications contained herein.
Section 23. CONSENTS, AMENDMENTS, WAIVERS, ETC.
Any consent or approval required or permitted by this Agreement to be
given by the Banks may be given, and any term of this Agreement, the other
Loan Documents or any other instrument related hereto or mentioned herein may
be amended, and the performance or observance by the Borrower of any terms of
this Agreement, the other Loan Documents or such other instrument or the
continuance of any Default or Event of Default may be waived (either
generally or in a particular instance and either retroactively or
prospectively) with, but only with, the written consent of the Borrower and
the written consent of the Majority Banks. Notwithstanding the foregoing,
the rate of interest on the Term Notes (other than interest accruing pursuant
to Section 3.12 following the effective date of any waiver by the Majority
Banks of the Default or Event of Default relating thereto), the date or
amount of an interest or principal payment hereunder and the Loan Percentage
of any Bank hereunder may not be changed without the written consent of the
Borrower and the written consent of each Bank affected thereby; the Term Loan
Maturity Date may not be postponed without the written consent of each Bank
affected thereby; this Section 23 and the definition of Majority Banks may
not be amended, without the written consent of all of the Banks; and the
amount of the Agent's Fee payable for the Agent's account and Section 12 may
not be amended without the written consent of the Agent. No waiver shall
extend to or affect any obligation not expressly waived or impair any right
consequent thereon. No course of dealing or delay or omission on the part of
the Agent or any Bank in exercising any right shall operate as a waiver
thereof or otherwise be prejudicial thereto. No notice to or demand upon the
Borrower shall entitle the Borrower to other or further notice or demand in
similar or other circumstances.
Section 24. SEVERABILITY.
The provisions of this Agreement are severable and if any one clause or
provision hereof shall be held invalid or unenforceable in whole or in part
in any jurisdiction, then such invalidity or unenforceability shall affect
only such clause or provision, or part thereof, in such jurisdiction, and
shall not in any manner affect such clause or provision
in any other jurisdiction, or any other clause or provision of this Credit
Agreement in any jurisdiction.
IN WITNESS WHEREOF, the undersigned have duly executed this Agreement as
of the date first set forth above.
BANGOR ENERGY RESALE, INC.
By: /s/Frederick S. Samp
-------------------------------------------
Name: Frederick S. Samp
Title: Treasurer
BANKBOSTON, N.A., individually and as Agent
By: /s/Micheal M. Parker
-------------------------------------------
Name: Michael M. Parker
Title: Managing Director
EXHIBIT A to
Term Loan Agreement
COLLATERAL ASSIGNMENT OF CONTRACTS
This ASSIGNMENT AGREEMENT (this "Agreement"), dated as of March 31,
1998, is between BANGOR ENERGY RESALE, INC., a Maine corporation (the
"Assignor"), and BANKBOSTON, N.A. as agent (the "Assignee").
WHEREAS, pursuant to the terms of the Term Loan Agreement, dated as of
March 31, 1998, (as amended, modified, supplemented or restated from time to
time, the "Loan Agreement"), among the Assignor, the lending institutions
listed on SCHEDULE 1 thereto (collectively, the "Banks") and the Assignee, as
agent, the Assignor has agreed to assign to the Assignee for the benefit of
the Assignee and the Banks, certain collateral as described below;
NOW, THEREFORE, the parties hereby agree as follows:
1. The Assignor hereby pledges, assigns, transfers and grants to the
Assignee a continuing first priority security interest and lien on all of the
Assignor's right, title and interest in (a) that certain Power Sales
Agreement between Unitil Power Corp., a New Hampshire corporation and Bangor
Hydro-Electric Company, a Maine corporation ("Bangor"), dated March 26, 1986
and amended by the Amendment to March 26, 1986, Power Sales Agreement, dated
April 29, 1993, and the Second Amendment to Power Sales Agreement, dated
March 1, 1995, as assigned to the Assignor pursuant to the Unitil Contract
Assignment dated as of the date hereof between Bangor and the Assignor (the
"Unitil Contract"), (b) that certain Agreement dated October 30, 1997 by and
between Bangor and the Assignor (the "Rate Schedule Agreement"), and (c) the
Service Agreement dated on or prior to the Closing Date between Bangor and
the Assignor (the "Service Agreement") and (d) any such contracts as Bangor
Energy may enter into in the future ancillary to the performance of the
Unitil Contract. Such agreements are therein referred to collectively as the
"Contracts", and copies of which are attached hereto as EXHIBIT A.
2. This assignment is made solely for the purpose of securing the
payment and performance by the Assignor of all of the Obligations (as defined
in the Loan Agreement) now existing or hereinafter arising. If and so long
as there shall not have occurred and be continuing any Event of Default and
acceleration or notice by the Majority Lenders under the Loan Agreement,
Assignee shall permit the Assignor to have the benefit of all rights under
the Contracts and the ability to enforce all the obligations under the
Contracts to the extent permitted by the Loan Documents.
3. Anything herein to the contrary notwithstanding, the Assignor shall
remain liable under the Contracts to the extent set forth therein to perform
all of its duties and obligations thereunder to the same extent as if this
Agreement had not been executed. The exercise by the Assignee of any of the
rights hereunder shall not release the Assignor from any of its duties of
obligations under the Contracts. The Assignee shall not have by reason of
this Agreement, nor shall the Assignee be obligated to perform, any of the
obligations or duties of the Assignor thereunder or to take any action to
collect of enforce any claim or payment assigned hereunder.
4. The Assignor further agrees, represents and warrants that:
(a) The Assignor specifically acknowledges and agrees that the
Assignee neither assumes, nor shall have any responsibility for, the payment
of any sums due or to become due under the Contracts or the performance of
the Contracts and the Assignor hereby agrees to indemnify the Assignee in
accordance with Section 13. 2 of the Loan Agreement.
(b) If there shall be a default under the Contracts on the part of
the Assignor, for any reason, the Assignee may, at its option, without
waiving or releasing the Assignor from any of the terms hereof or any of the
Obligations, cure the default, and the cost of curing the same (and all
necessary and incidental costs and expenses in connection therewith,
including, but not limited to, reasonable counsel fees), with interest at the
highest rate payable on the Obligations from the time of the advance or
advances therefor, shall be deemed an advance to the Assignor and part of the
Obligations, and shall be due and payable by the Assignor to the Assignee
upon demand.
(c) If an Event of Default shall occur and be continuing, in
addition to all other rights and remedies of the Assignee pursuant to any
agreements of the Assignor in favor of or assigned to and held by the
Assignee or pursuant to applicable law or otherwise, the Assignee or its
successor or designee shall have (i) all of the rights and remedies under
applicable law, including, without limitation, the rights and remedies
provided to a secured party under the Uniform Commercial Code as enacted and
then in force in any jurisdiction of the United States and any analogous
legislation or laws of like import or purpose in force in any other country,
(ii) all of the rights and remedies provided to the Assignee under the
Security Agreement dated as of March 31, 1998 and between the Assignee and
the Assignor (the "Security Agreement"), and (iii) only after acceleration or
direction by the Majority Banks and subject to necessary governmental
authorizations and filings, if any, all rights and benefits under the
Contracts without, in each case, modifying or discharging any of the
Obligations. Upon the occurrence and during the continuance of any such
Event of Default, the Assignor agrees to execute any and all documents
requested by the Assignee in its sole discretion to enable the Assignee to
exercise all of the rights of the Assignor under the Contracts.
(f) The Assignee may take or release other security which it may
hold for the payment of the Obligations, may release any party primarily or
secondarily liable therefor, and may apply any other security held by it to
the satisfaction, or partial satisfaction, of such Obligations without
prejudice to any of its rights under this Agreement.
(g) The Assignor hereby designates and appoints the Assignee and
each of its designees or agents as attorney-in-fact of the Assignor
irrevocably and with power of substitution, with authority to execute and
deliver for and on behalf of the Assignor, after the occurrence and during
the continuance of an Event of Default and acceleration or direction of the
Majority Banks, any and all instruments, documents, agreements and other
writings necessary or advisable for the exercise on behalf of the Assignor of
any rights created or existing under or pursuant to the Contracts.
5. The Assignee hereby accepts such assignment and assumes and agrees
to perform, observe and comply with all of the Assignor's obligations under
the Contracts, but only in the event that it in fact shall have exercised its
rights as Assignee hereunder.
6. This Agreement shall be binding upon and enure to the benefit of
the respective successors and assigns of the Assignor and the Assignee.
7. All capitalized terms not specifically defined in this Agreement
and defined in the Loan Agreement shall have the same meanings herein as in
the Loan Agreement.
8. This Agreement shall create a continuing assignment of and security
interest in the Contracts and shall remain in full force and effect until
payment in full in cash of principal and interest on the Term Loan and all
other Obligations then due and payable.
9. This Agreement has been executed as a supplement to and not a
substitution for or amendment to the Security Agreement, and nothing
contained in this Agreement shall derogate from any of the rights or remedies
granted by the Assignor in favor of the Assignee pursuant to the Security
Agreement.
10. THIS AGREEMENT SHALL, PURSUANT TO NEW YORK GENERAL OBLIGATIONS LAW
SECTION 5-1401, BE GOVERNED BY, AND CONSTRUED IN ACCORDANCE WITH, THE LAWS OF
THE STATE OF NEW YORK.
11. This Agreement may be executed in several counterparts and by each
party on a separate counterpart, each of which when so executed and delivered
shall be an original, and all of which together shall constitute one
instrument. In proving this Agreement, it shall not be necessary to produce
or account for more than one such counterpart signed by the party against
whom enforcement is sought.
[Signature Page Follows]
IN WITNESS WHEREOF, the Assignor and the Assignee have executed this
instrument as of the date first written above.
BANGOR ENERGY RESALE, INC.
By:
------------------------------------
Name:
Title:
BANKBOSTON, N.A., as Agent
By:
------------------------------------
Name:
Title:
Acknowledged and Consented to by:
BANGOR HYDRO-ELECTRIC COMPANY
By:
--------------------------
Name:
Title:
EXHIBIT B to
Term Loan Agreement
SECURITY AGREEMENT
SECURITY AGREEMENT, dated as of March 31, 1998, between BANGOR ENERGY
RESALE, INC., a Maine corporation (the "Company"), and BANKBOSTON, N.A., a
national banking association, as agent (hereinafter, in such capacity, the
"Agent") for itself and the other lending institutions (hereinafter,
collectively, the "Banks") which are or may become parties to a Term Loan
Agreement dated as of March 31, 1998 (as amended and in effect from time to
time, the "Loan Agreement"), among the Company, the Banks and the Agent.
WHEREAS, the Company has entered into the Loan Agreement with the Agent
and the Banks, pursuant to which the Banks, subject to the terms and
conditions contained therein, are to make a Term Loan to the Company; and
WHEREAS, it is a condition precedent to the Banks' making the Term Loan
to the Company under the Loan Agreement that the Company execute and deliver
to the Agent, for the benefit of the Banks and the Agent, a security
agreement in substantially the form hereof; and
WHEREAS, the Company wishes to grant security interests in favor of the
Agent, for the benefit of the Banks and the Agent, as herein provided;
NOW, THEREFORE, in consideration of the promises contained herein and
for other good and valuable consideration, the receipt and sufficiency of
which are hereby acknowledged, the parties hereto agree as follows:
1. DEFINITIONS.
All capitalized terms used herein without definitions shall have the
respective meanings provided therefor in the Loan Agreement. All terms
defined in the Uniform Commercial Code of the State of New York and used
herein shall have the same definitions herein as specified therein.
2. GRANT OF SECURITY INTEREST.
2.1. COLLATERAL GRANTED.
The Company hereby grants to the Agent, for the benefit of the Banks and
the Agent, to secure the payment and performance in full of all of the
Obligations, a security interest in and so pledges and assigns to the Agent,
for the benefit of the Banks and the Agent, the following properties, assets
and rights of the Company, wherever located, whether now owned or hereafter
acquired or arising, and all proceeds and products thereof (all of the same
being hereinafter called the "Collateral"):
All personal and fixture property of every kind and nature
including without limitation all furniture, fixtures, equipment, raw
materials, inventory, other goods, accounts, contract rights, rights to
the payment of money, insurance refund claims and all other insurance
claims and proceeds, tort claims, chattel paper, documents, instruments,
securities and other investment property, deposit accounts, rights to
proceeds of letters of credit and all general intangibles including,
without limitation, all tax refund claims, license fees, patents, patent
applications, trademarks, trademark applications, trade names,
copyrights, copyright applications, rights to sue and recover for past
infringement of patents, trademarks and copyrights, computer programs,
computer software, engineering drawings, service marks, customer lists,
goodwill, and all licenses, permits, agreements of any kind or nature
pursuant to which the Company possesses, uses or has authority to
possess or use property (whether tangible or intangible) of others or
others possess, use or have authority to possess or use property
(whether tangible or intangible) of the Company, and all recorded data
of any kind or nature, regardless of the medium of recording including,
without limitation, all software, writings, plans, specifications and
schematics.
2.2. DELIVERY OF INSTRUMENTS, ETC.
(a) Pursuant to the terms hereof, the Company has endorsed,
assigned and delivered to the Agent all negotiable or non-negotiable
instruments (including certificated securities), and chattel paper
pledged by it hereunder, together with instruments of transfer or
assignment duly executed in blank as the Agent may have specified. In
the event that the Company shall, after the date of this Agreement,
acquire any other negotiable or non-negotiable instruments (including
certificated securities), or chattel paper to be pledged by it
hereunder, the Company shall forthwith endorse, assign and deliver the
same to the Agent, accompanied by such instruments of transfer or
assignment duly executed in blank as the Agent may from time to time
specify.
(b) To the extent that any securities now or hereafter acquired by
the Company are uncertificated and are issued to the Company or its
nominee directly by the issuer thereof, the Company shall cause the
issuer to note on its books the security interest of the Agent in such
securities and shall cause the issuer, pursuant to an agreement in form
and substance satisfactory to the Agent, to agree to comply with
instructions from the Agent as to such securities, without further
consent of the Company or such nominee. To the extent that any
securities, whether certificated or uncertificated, or other financial
assets now or hereafter acquired by the Company are held by the Company
or its nominee through a securities intermediary, the Company shall
(i) cause such securities intermediary to note on its books the security
interest of the Agent in such securities or other financial assets and
to confirm such notation promptly to the Agent and (ii) at the request
of the Agent, cause such securities intermediary, pursuant to an
agreement in form and substance satisfactory to the Agent, to agree to
comply with entitlement orders or other instructions from the Agent as
to such securities or other financial assets, without further consent of
the Company or such nominee.
2.3. EXCLUDED COLLATERAL.
Notwithstanding the foregoing provisions of this Section 2, such grant
of security interest shall not extend to, and the term "Collateral" shall not
include, any chattel paper and general intangibles which are now or hereafter
held by the Company as licensee, lessee or otherwise, to the extent that (a)
such chattel paper and general intangibles are not assignable or capable of
being encumbered as a matter of law or under the terms of the license, lease
or other agreement applicable thereto (but solely to the extent that any such
restriction shall be enforceable under applicable law), without the consent
of the licensor or lessor thereof or other applicable party thereto and (b)
such consent has not been obtained; PROVIDED, HOWEVER, that the foregoing
grant of security interest shall extend to, and the term "Collateral" shall
include, (i) any and all proceeds of such chattel paper and general
intangibles to the extent that the assignment or encumbering of such proceeds
is not so restricted and (ii) upon any such licensor, lessor or other
applicable party consent with respect to any such otherwise excluded chattel
paper or general intangibles being obtained, thereafter such chattel paper or
general intangibles as well as any and all proceeds thereof that might have
theretofore have been excluded from such grant of a security interest and the
term "Collateral"
3. TITLE TO COLLATERAL.
The Company is the owner of the Collateral free from any adverse lien,
security interest or other encumbrance, except for the security interest
created by this Agreement and other liens permitted by the Loan Agreement.
None of the Collateral constitutes, or is the proceeds of, "farm products" as
defined in Section 9-109(3) of the Uniform Commercial Code of the State of
New York.
4. CONTINUOUS PERFECTION.
The Company's place of business or, if more than one, chief executive
office is indicated on the Perfection Certificate delivered to the Agent
herewith (the "Perfection Certificate"). The Company will not change the
same, or the name, identity or corporate structure of the Company in any
manner, without providing at least thirty (30) days prior written notice to
the Agent. The Collateral, to the extent not delivered to the Agent pursuant
to Section 2.2, will be kept at those locations listed on the Perfection
Certificate and the Company will not remove the Collateral from such
locations, without providing at least thirty (30) days prior written notice
to the Agent.
5. NO LIENS.
Except for the security interest herein granted and liens permitted by
the Loan Agreement, the Company shall be the owner of the Collateral free
from any lien, security interest or other encumbrance, and the Company shall
defend the same against all claims and demands of all persons at any time
claiming the same or any interests therein adverse to the Agent or any of the
Banks. The Company shall not pledge, mortgage or create, or suffer to exist
a security interest in the Collateral in favor of any person other than the
Agent, for the benefit of the Banks and the Agent except for liens expressly
permitted by the Loan Agreements.
6. NO TRANSFERS.
The Company will not sell or offer to sell or otherwise transfer the
Collateral or any interest therein except for sales of inventory in the
ordinary course of business.
7. INSURANCE.
7.1. MAINTENANCE OF INSURANCE.
The Company will maintain insurance in accordance with Section 6.7 of
the Loan Agreement. In addition, the Company and the Agent shall be named
additional insured under the umbrella insurance policy of Bangor in
accordance with Section 9.8 of the Loan Agreement.
7.2. NOTICE OF CANCELLATION, ETC.
All policies of insurance shall provide for at least thirty (30) days
prior written cancellation notice to the Agent. In the event of failure by
the Company to maintain insurance as herein provided, the Agent may, at its
option upon five (5) days prior notice to the Company, obtain such insurance
and charge the amount thereof to the Company.
8. MAINTENANCE OF COLLATERAL; COMPLIANCE WITH LAW.
The Company will keep the Collateral in good order and repair and will
not use the same in violation of law or any policy of insurance thereon. The
Agent, or its designee, may inspect the Collateral at any reasonable time,
wherever located. Subject to the provisions of the Loan Agreement, the
Company will pay promptly when due all taxes, assessments, government charges
and levies upon the Collateral incurred in connection with this Agreement.
9. COLLATERAL PROTECTION EXPENSES; PRESERVATION OF COLLATERAL.
9.1. EXPENSES INCURRED BY AGENT.
The Company agrees to pay (a) all reasonable out-of-pocket expenses
(including without limitation reasonable attorneys' fees and costs, and
reasonable consulting, accounting, appraisal, investment banking and similar
professional fees and charges) incurred by any Bank or the Agent in
connection with (i) the enforcement of or preservation of rights under any of
the Loan Documents against the Company or the administration thereof after
the occurrence of a Default or Event of Default and (ii) any litigation,
proceeding or dispute arising hereunder or in connection with any Bank's or
the Agent's relationship with the Company hereunder; PROVIDED that all
reasonable out-of-pocket expenses (including without limitation reasonable
attorneys' fees and costs, and reasonable consulting, accounting, appraisal,
investment banking and similar professional fees and charges) incurred by any
Bank or the Agent in connection with (A) the enforcement of or preservation
of rights under any of the Loan Documents against the Company or the
administration thereof after the occurrence of a Default or Event of Default
and (B) any litigation, proceeding or dispute whether arising hereunder or
otherwise, in any way related to any Bank's or the Agent's relationship with
the Company hereunder and (b) all reasonable out-of-pocket fees, expenses and
disbursements of the Agent incurred in connection with UCC searches and UCC
filings. Notwithstanding the foregoing, the Company shall have no obligation
hereunder to the Agent or any Bank with respect to any costs or expenses
arising from the gross negligence or willful misconduct of the Agent or such
Bank, as the case may be.
9.2. AGENT'S OBLIGATIONS AND DUTIES.
Anything herein to the contrary notwithstanding, the Company shall
remain liable under each contract or agreement comprised in the Collateral to
be observed or performed by the Company thereunder. Neither the Agent nor
any Bank shall have any obligation or liability under any such contract or
agreement by reason of or arising out of this Agreement or the receipt by the
Agent or any Bank of any payment relating to any of the Collateral, nor shall
the Agent or any Bank be obligated in any manner to perform any of the
obligations of the Company under or pursuant to any such contract or
agreement, to make inquiry as to the nature or sufficiency of any payment
received by the Agent or any Bank in respect of the Collateral or as to the
sufficiency of any performance by any party under any such contract or
agreement, to present or file any claim, to take any action to enforce any
performance or to collect the payment of any amounts which may have been
assigned to the Agent or to which the Agent or any Bank may be entitled at
any time or times. The Agent's sole duty with respect to the custody, safe
keeping and physical preservation of the Collateral in its possession, under
Section 9-207 of the Uniform Commercial Code of the State of New York or
otherwise, shall be to deal with such Collateral in the same manner as the
Agent deals with similar property for its own account.
10. SECURITIES AND DEPOSITS.
The Agent may at any time after an Event of Default and upon
acceleration of the Obligations, at its option, transfer to itself or any
nominee any securities constituting Collateral, receive any income thereon
and hold such income as additional Collateral or apply it to the Obligations
that are then due and payable, and may demand, sue for, collect, or make any
settlement or compromise which it deems desirable with respect to the
Collateral.
11. FURTHER ASSURANCES.
The Company, at its own expense, shall do, make, execute and deliver all
such additional and further acts, things, deeds, assurances and instruments
as the Agent may reasonably require more completely to vest in and assure to
the Agent and the Banks their respective rights hereunder or in any of the
Collateral, including, without limitation, (a) executing, delivering and,
where appropriate, filing financing statements and continuation statements
under the Uniform Commercial Code, (b) obtaining governmental and other third
party consents and approvals, including without limitation any consent of any
licensor, lessor or other applicable party referred to in Section 2.3.
12. POWER OF ATTORNEY.
12.1. APPOINTMENT AND POWERS OF AGENT.
The Company hereby irrevocably constitutes and appoints the Agent and
any officer or agent thereof, with full power of substitution, as its true
and lawful attorneys-in-fact with full irrevocable power and authority in the
place and stead of the Company or in the Agent's own name, for the purpose of
carrying out the terms of this Agreement, at any time during an Event of
Default and upon acceleration of the Obligations (i) to take any and all
appropriate action and (ii) to execute any and all documents and instruments
that may be necessary or desirable to accomplish the purposes of this
Agreement and, without limiting the generality of the foregoing, hereby gives
said attorneys the power and right, on behalf of the Company, without notice
to or assent by the Company, to do the following:
(a) upon the occurrence and during the continuance of an Event of
Default and upon acceleration of the Obligations, generally to sell,
transfer, pledge, make any agreement with respect to or otherwise deal
with any of the Collateral in such manner as is consistent with the
Uniform Commercial Code of the State of New York and as fully and
completely as though the Agent were the absolute owner thereof for all
purposes, and to do at the Company' expense, at any time, or from time
to time, all acts and things which the Agent deems necessary to protect,
preserve or realize upon the Collateral and the Agent's security
interest therein, in order to effect the intent of this Agreement, all
as fully and effectively as the Company might do, including, without
limitation, (i) the filing and prosecuting of registration and transfer
applications with the appropriate federal or local agencies or
authorities with respect to trademarks, copyrights and patentable
inventions and processes, (ii) upon written notice to the Company, the
exercise of voting rights with respect to voting securities, which
rights may be exercised, if the Agent so elects, with a view to causing
the liquidation in a commercially reasonable manner of assets of the
issuer of any such securities and (iii) the execution, delivery and
recording, in connection with any sale or other disposition of any
Collateral, of the endorsements, assignments or other instruments of
conveyance or transfer with respect to such Collateral; and
(b) to file such financing statements with respect hereto, with or
without the Company's signature, or a photocopy of this Agreement in
substitution for a financing statement, as the Agent may deem
appropriate and to execute in the Company's name such financing
statements and amendments thereto and continuation statements which may
require the Company's signature, and shall provide the Company with
evidence and confirmation of such filing.
12.2. RATIFICATION BY COMPANY.
To the extent permitted by law, the Company hereby ratifies all that
said attorneys shall lawfully do or cause to be done by virtue hereof. This
power of attorney is a power coupled with an interest and shall be
irrevocable.
12.3. NO DUTY ON AGENT.
The powers conferred on the Agent hereunder are solely to protect the
interests of the Agent and the Banks in the Collateral and shall not impose
any duty upon the Agent to exercise any such powers. The Agent shall be
accountable only for the amounts that it actually receives as a result of the
exercise of such powers and neither it nor any of its officers, directors,
employees or agents shall be responsible to the Company for any act or
failure to act, except for the Agent's own gross negligence or willful
misconduct.
13. REMEDIES.
If an Event of Default shall have occurred and be continuing, the Agent
may, without notice to or demand upon the Company, declare this Agreement to
be in default, and following acceleration of the Obligations in accordance
with the Loan Agreement, the Agent shall thereafter have in any jurisdiction
in which enforcement hereof is sought, in addition to all other rights and
remedies, the rights and remedies of a secured party under the Uniform
Commercial Code, including, without limitation, the right to take possession
of the Collateral, and for that purpose the Agent may, so far as the Company
can give authority therefor, enter upon any premises on which the Collateral
may be situated and remove the same therefrom. In connection therewith the
Agent may in its discretion require the Company to assemble all or any part
of the Collateral at such location or locations within the state(s) of the
Company's principal office(s) or at such other locations as the Agent may
designate. The Agent shall give to the Company at least five (5) Business
Days prior written notice of the time and place of any public sale of
Collateral or of the time after which any private sale or any other intended
disposition is to be made. The Company hereby acknowledges that five
(5) Business Days prior written notice of such sale or sales shall be
reasonable notice. In addition, the Company waives any and all rights that
it may have to a judicial hearing in advance of the enforcement of any of the
Agent's rights hereunder, including, without limitation, its right following
an Event of Default to take immediate possession of the Collateral and to
exercise its rights with respect thereto. To the extent that any of the
Obligations are to be paid or performed by a person other than the Company,
the Company waives and agrees not to assert any rights or privileges which it
may have under Section 9-112 of the Uniform Commercial Code of the State of
New York.
14. NO WAIVER, ETC.
The Company waives demand, notice, protest, notice of acceptance of this
Agreement, notice of loans made, credit extended, Collateral received or
delivered or other action taken in reliance hereon and all other demands and
notices of any description. With respect to both the Obligations and the
Collateral, the Company assents to any extension or postponement of the time
of payment or any other indulgence, to any substitution, exchange or release
of or failure to perfect any security interest in any Collateral, to the
addition or release of any party or person primarily or secondarily liable,
to the acceptance of partial payment thereon and the settlement, compromising
or adjusting of any thereof, all in such manner and at such time or times as
the Agent may deem advisable. The Agent shall have no duty as to the
collection or protection of the Collateral or any income thereon, nor as to
the preservation of rights against prior parties, nor as to the preservation
of any rights pertaining thereto beyond the safe custody thereof as set forth
in Section 9.2. The Agent shall not be deemed to have waived any of its
rights upon or under the Obligations or the Collateral unless such waiver
shall be in writing and signed by the Agent. No delay or omission on the
part of the Agent in exercising any right shall operate as a waiver of such
right or any other right. A waiver on any one occasion shall not be
construed as a bar to or waiver of any right on any future occasion. All
rights and remedies of the Agent with respect to the Obligations or the
Collateral, whether evidenced hereby or by any other instrument or papers,
shall be cumulative and may be exercised singularly, alternatively,
successively or concurrently at such time or at such times as the Agent deems
expedient.
15. MARSHALLING.
Neither the Agent nor any Bank shall be required to marshal any present
or future collateral security (including but not limited to this Agreement
and the Collateral) for, or other assurances of payment of, the Obligations
or any of them or to resort to such collateral security or other assurances
of payment in any particular order, and all of the rights of the Agent
hereunder and of the Agent or any Bank in respect of such collateral security
and other assurances of payment shall be cumulative and in addition to all
other rights, however existing or arising. To the extent that it lawfully
may, the Company hereby agrees that it will not invoke any law relating to
the marshalling of collateral which might cause delay in or impede the
enforcement of the Agent's rights under this Agreement or under any other
instrument creating or evidencing any of the Obligations or under which any
of the Obligations is outstanding or by which any of the Obligations is
secured or payment thereof is otherwise assured, and, to the extent that it
lawfully may, the Company hereby irrevocably waives the benefits of all such
laws.
16. GOVERNING LAW; CONSENT TO JURISDICTION.
THIS AGREEMENT IS INTENDED TO TAKE EFFECT AND SHALL, PURSUANT TO New
York General Obligations Law Section 5-1401, BE GOVERNED BY, AND CONSTRUED IN
ACCORDANCE WITH, THE LAWS OF THE STATE OF NEW YORK. The Company agrees that
any suit for the enforcement of this Agreement may be brought in the courts
of the State of New York or any federal court sitting therein and consents to
the non-exclusive jurisdiction of such court and to service of process in any
such suit being made upon the Company by mail at the address specified in
Section 17 of the Loan Agreement. The Company hereby waives any objection
that it may now or hereafter have to the venue of any such suit or any such
court or that such suit is brought in an inconvenient court.
17. WAIVER OF JURY TRIAL.
EACH OF THE AGENT, THE COMPANY AND THE BANKS WAIVE THEIR RIGHT TO A JURY
TRIAL WITH RESPECT TO ANY ACTION OR CLAIM ARISING OUT OF ANY DISPUTE IN
CONNECTION WITH THIS AGREEMENT, ANY RIGHTS OR OBLIGATIONS HEREUNDER OR THE
PERFORMANCE OF ANY SUCH RIGHTS OR OBLIGATIONS. Except as prohibited by law,
the Company waives any right which it may have to claim or recover in any
litigation referred to in the preceding sentence any special, exemplary,
punitive or consequential damages or any damages other than, or in addition
to, actual damages. The Company (a) certifies that neither the Agent or any
Bank nor any representative, agent or attorney of the Agent or any Bank has
represented, expressly or otherwise, that the Agent or any Bank would not, in
the event of litigation, seek to enforce the foregoing waivers and
(b) acknowledges that, in entering into the Loan Agreement and the other Loan
Documents to which the Agent or any Bank is a party, the Agent and the Banks
are relying upon, among other things, the waivers and certifications
contained in this Section 17.
18. MISCELLANEOUS.
The headings of each section of this Agreement are for convenience only
and shall not define or limit the provisions thereof. This Agreement and all
rights and obligations hereunder shall be binding upon the Company and its
respective successors and assigns, and shall inure to the benefit of the
Agent, the Banks and their respective successors and assigns. If any term of
this Agreement shall be held to be invalid, illegal or unenforceable, the
validity of all other terms hereof shall in no way be affected thereby, and
this Agreement shall be construed and be enforceable as if such invalid,
illegal or unenforceable term had not been included herein. The Company
acknowledges receipt of a copy of this Agreement.
[Remainder of page intentionally left blank]
IN WITNESS WHEREOF, intending to be legally bound, the Company has
caused this Agreement to be duly executed as of the date first above written.
BANGOR ENERGY RESALE, INC.
By:
-------------------------------------------
Name:
Title:
Accepted:
BANKBOSTON, N.A.,
as Agent
By:
------------------------------------
Name:
Title:
CERTIFICATE OF ACKNOWLEDGMENT
STATE OF _____________________________________ )
) ss.
COUNTY OF _____________________________________ )
Before me, the undersigned, a Notary Public in and for the county
aforesaid, on this ___ day of March, 1998, personally appeared
_________________ to me known personally, and who, being by me duly sworn,
deposes and says that he is the ______________ of Bangor Energy Resale, Inc.,
and that said instrument was signed and sealed on behalf of said corporation
by authority of its Board of Directors, and said ______________ acknowledged
said instrument to be the free act and deed of said corporation.
______________________________
Notary Public
My commission expires:______________
EXHIBIT C to the
Term Loan Agreement
TERM NOTE
$24,800,000 March 31, 1998
FOR VALUE RECEIVED, the undersigned BANGOR ENERGY RESALE, INC., a Maine
corporation (the "Borrower"), hereby promises to pay to the order of,
BANKBOSTON, N.A., a national banking association (the "Bank"), at the Agent's
Head Office (as defined in the Loan Agreement referred to below):
(a) prior to or on the Maturity Date the principal amount of
Twenty Four Million Eight Hundred Thousand Dollars ($24,800,000),
evidencing the Term Loan made by the Bank to the Borrower pursuant to
the Term Loan Agremment, dated as of March 31, 1998 (as amended and in
effect from time to time, the "Loan Agreement"), by and among the
Borrower, the Bank and other parties thereto;
(b) the principal outstanding hereunder from time to time at the
times provided in the Loan Agreement; and
(c) interest from the date hereof on the principal amount from
time to time outstanding to and including the maturity hereof at the
rates and terms and in all cases in accordance with the terms of the
Loan Agreement.
This promissory note (this "Note") evidences borrowings under and has
been issued by the Borrower in accordance with the terms of the Loan
Agreement. The Bank and any holder hereof is entitled to the benefits of the
Loan Agreement, the Security Documents and the other Loan Documents, and may
enforce the agreements of the Borrower contained therein, and any holder
hereof may exercise the respective remedies provided for thereby or otherwise
available in respect thereof, all in accordance with the respective terms
thereof. All capitalized terms used in this Note and not otherwise defined
herein shall have the same meanings herein as in the Loan Agreement.
The Borrower irrevocably authorizes the Bank to make or cause to be
made, at the time of receipt of any payment of principal of this Note, an
appropriate notation on the grid attached to this Note, or the continuation
of such grid, or any other similar record, including computer records,
reflecting the receipt of such payment. The outstanding amount of the Term
Loan set forth on the grid attached to this Note, or the continuation of such
grid, or any other similar record, including computer records, maintained by
the Bank with respect to the Term Loan shall, absent manifest error, be PRIMA
FACIE evidence of the principal amount of the Term Loan owing and unpaid to
the Bank, but the failure to record, or any error in so recording, any such
amount on any such grid, continuation or other record shall not limit or
otherwise affect the obligation of the Borrower hereunder or under the Loan
Agreement to make payments of principal of and interest on this Note when
due.
The Borrower has the right in certain circumstances and the obligation
under certain other circumstances to prepay the whole or part of the
principal of this Note on the terms and conditions specified in the Loan
Agreement.
If any one or more of the Events of Default shall occur, the entire
unpaid principal amount of this Note and all of the unpaid interest accrued
thereon may become or be declared due and payable in the manner and with the
effect provided in the Loan Agreement.
No delay or omission on the part of the Bank or any holder hereof in
exercising any right hereunder shall operate as a waiver of such right or of
any other rights of the Bank or such holder, nor shall any delay, omission or
waiver on any one occasion be deemed a bar or waiver of the same or any other
right on any future occasion.
The Borrower and every endorser and guarantor of this Note or the
obligation represented hereby waives presentment, demand, notice, protest and
all other demands and notices in connection with the delivery, acceptance,
performance, default or enforcement of this Note, and assents to any
extension or postponement of the time of payment or any other indulgence, to
any substitution, exchange or release of collateral and to the addition or
release of any other party or person primarily or secondarily liable.
THIS NOTE AND THE OBLIGATIONS OF THE BORROWER HEREUNDER SHALL FOR ALL
PURPOSES BE GOVERNED BY AND CONSTRUED IN ACCORDANCE WITH THE LAW OF THE STATE
OF NEW YORK (EXCLUDING THE LAWS APPLICABLE TO CONFLICTS OR CHOICE OF LAW
OTHER THAN NEW YORK GENERAL OBLIGATIONS LAW Section 5-1401). THE BORROWER
AGREES THAT ANY SUIT FOR THE ENFORCEMENT OF THIS NOTE MAY BE BROUGHT IN THE
COURTS OF THE STATE OF NEW YORK OR ANY FEDERAL COURT SITTING THEREIN AND THE
CONSENT TO THE NONEXCLUSIVE JURISDICTION OF SUCH COURT AND THE SERVICE OF
PROCESS IN ANY SUCH SUIT BEING MADE UPON THE BORROWER BY MAIL AT THE ADDRESS
SPECIFIED IN Section 17 OF THE LOAN AGREEMENT. THE BORROWER HEREBY WAIVES
ANY OBJECTION THAT IT MAY NOW OR HEREAFTER HAVE TO THE VENUE OF ANY SUCH SUIT
OR ANY SUCH COURT OR THAT SUCH SUIT IS BROUGHT IN AN INCONVENIENT COURT.
IN WITNESS WHEREOF, the undersigned has caused this Note to be signed in
its corporate name by its duly authorized officer as of the day and year
first above written.
BANGOR ENERGY RESALE, INC.
By:
-------------------------------------------
Name:
Title:
EXHIBIT D to
Term Loan Agreement
FORM OF COMPLIANCE CERTIFICATE
[Date]
To the Banks Party to the
Loan Agreement Referred to Below
c/o BankBoston, N.A., as Agent
100 Federal Street
Boston, Massachusetts 02110
Attn. MICHAEL M. PARKER:
Ladies and Gentlemen:
Reference is hereby made to the Term Loan Agreement, dated as of
March 31, 1998 (as amended and in effect from time to time, the "Loan
Agreement"), by and among BANGOR ENERGY RESALE, INC., a Maine corporation
(the "Borrower"), BANKBOSTON, N.A., a national banking association and the
other lending institutions which are or may become parties to the Loan
Agreement (hereinafter, collectively, the "Banks") and BankBoston, N.A. as
agent for the Banks (in such capacity, the "Agent"). All terms defined in
the Loan Agreement and used herein without definition shall have the same
respective meaning provided therefor in the Loan Agreement.
Pursuant to Section 6.3 of the Loan Agreement, the principal financial or
accounting officer of the Borrower hereby certifies to each of you as
follows: (a) the information furnished in the calculations attached hereto
was true and correct in all material respects as of the last day of the
fiscal [year] [quarter] next preceding the date of this certificate; (b) as
of the date of this certificate, there exists no Default or Event of Default;
and (c) the financial statements delivered herewith were prepared in
accordance with generally accepted accounting principles applied on a basis
consistent with prior periods (except, in the case of quarterly statements,
for provisions for footnotes and, in all cases, except as disclosed therein).
IN WITNESS WHEREOF, the undersigned officer has executed this Compliance
Certificate as of the date first written above.
BANGOR ENERGY RESALE, INC.
By:_______________________________
Name:
Title:
COMPLIANCE CERTIFICATE WORKSHEET
Financial Covenants
For the period ended _________, 199__
8.1 NET WORTH
(a) Total Assets of the Borrower for the period ending _______ $_______
(b) Total Liabilities of the Borrower for the period ending ___ $_______
(c) The excess of (a) over (b)
(Not to be less than amounts set forth in
Loan Agreement) $_______
8.2 DEBT SERVICE RATIO
(a) Cash payments received for System Power
for the period ending ___________ $_______
(b) Total Debt Service for such period $_______
(c) Costs and expenses for such System Power
in such period $_______
(d) Sum of (b) PLUS (c) $_______
(e) Ratio of (a) to (d)
(Not to be less than 1.20:1:00 at any time) $_______
8.3 CAPITAL EXPENDITURE
Capital Expenditures made in such period
(shall not exceed $0) $_______
EXHIBIT E to the
Term Loan Agreement
BANGOR ENERGY RESALE, INC.
33 State Street
Bangor, Maine 04402
DIRECT COLLECTION LETTER
of
THE POWER SALES AGREEMENT
(the "Unitil Contract")
dated as of March 26, 1986,
amended as of April 29, 1993, and
amended as of March 1, 1995
by and between
UNITIL POWER CORP.
and
BANGOR ENERGY RESALE, INC.
Except as otherwise directed in writing by BankBoston, N.A. in its
capacity as agent (the "Agent") under a certain Term Loan Agreement, dated as
of March 31, 1998 by and among, the Agent, Bangor Energy Resale, Inc., and
certain lenders party thereto (the "Loan Agreement"), you are hereby
instructed to pay all of your payments and other amounts payable by you to us
under that certain Power Sale Agreement described above (the "Unitil
Contract") to the following address:
___________________________
___________________________
___________________________
Unless otherwise agreed to in writing by the Agent, only payments made
as provided above shall satisfy your obligations to make payments under the
Unitil Contract.
Sincerely,
Date: March 31, 1998 BANGOR ENERGY RESALE, INC.
By: ________________________
Name:
Title:
EXHIBIT F to
Term Loan Agreement
FORM OF ASSIGNMENT AND ACCEPTANCE
Dated as of __________________
Reference is made to the Term Loan Agreement, dated as of March 31, 1998
(as from time to time amended and in effect, the "Loan Agreement"), by and
among BANGOR ENERGY RESALE, INC., a Maine corporation (the "Borrower"), the
banking institutions referred to therein as Banks (collectively, the
"Banks"), and BANKBOSTON, N.A., a national banking institution, as agent (in
such capacity, the "Agent") for the Banks. Capitalized terms used herein and
not otherwise defined shall have the meanings assigned to such terms in the
Loan Agreement.
____________________ (the "Assignor") and ____________________ (the
"Assignee") hereby agree as follows:
1. ASSIGNMENT.
Subject to the terms and conditions of this Assignment and Acceptance,
the Assignor hereby sells and assigns to the Assignee, and the Assignee
hereby purchases and assumes without recourse to the Assignor, a $_______
interest in and to the rights, benefits, indemnities and obligations of the
Assignor under the Term Agreement equal to ____% in respect of the Term Loan
immediately prior to the Effective Date (as hereinafter defined).
2. ASSIGNOR'S REPRESENTATIONS.
The Assignor (i) represents and warrants that (A) it is legally
authorized to enter into this Assignment and Acceptance, (B) as of the date
hereof, the aggregate outstanding balance of its Term Loan equals $_________
(in each case after giving effect to the assignment contemplated hereby but
without giving effect to any contemplated assignments which have not yet
become effective), and (C) immediately after giving effect to all assignments
which have not yet become effective, the Assignor's Loan Percentage will be
sufficient to give effect to this Assignment and Acceptance, (ii) makes no
representation or warranty, express or implied, and assumes no responsibility
with respect to any statements, warranties or representations made in or in
connection with the Term Agreement or any of the other Loan Documents or the
execution, legality, validity, enforceability, genuineness, sufficiency or
value of the Term Agreement, any of the other Loan Documents or any other
instrument or document furnished pursuant thereto or the attachment,
perfection or priority of any security interest, other than that it is the
legal and beneficial owner of the interest being assigned by it hereunder
free and clear of any claim or encumbrance; (iii) makes no representation or
warranty and assumes no responsibility with respect to the financial
condition of the Borrower or any other Person primarily or secondarily liable
in respect of any of the Obligations, or the performance or observance by the
Borrower or any other Person primarily or secondarily liable in respect of
any of the Obligations of any of its obligations under the Term Agreement or
any of the other Loan Documents or any other instrument or document delivered
or executed pursuant thereto; and (iv) attaches hereto the Term Note
delivered to it under the Term Agreement.
The Assignor requests that the Borrower exchange the Assignor's Term
Note for new Term Notes payable to the Assignor and the Assignee as follows:
Notes Payable to Amount of
the Order of: Term Note
Assignor $_____________
Assignee $_____________
3. ASSIGNEE'S REPRESENTATIONS.
The Assignee (i) represents and warrants as of the date hereof and as of
the Effective Date that (A) it is duly and legally authorized to enter into
this Assignment and Acceptance, (B) the execution, delivery and performance
of this Assignment and Acceptance do not conflict with any provision of law
or of the charter or by-laws of the Assignee, or of any agreement binding on
the Assignee, (C) all acts, conditions and things required to be done and
performed and to have occurred prior to the execution, delivery and
performance of this Assignment and Acceptance, and to render the same the
legal, valid and binding obligation of the Assignee, enforceable against it
in accordance with its terms, have been done and performed and have occurred
in due and strict compliance with all applicable laws; (ii) confirms that it
has received a copy of the Term Agreement, together with copies of the most
recent financial statements delivered pursuant to Section 6.3 thereof and
such other documents and information as it has deemed appropriate to make its
own credit analysis and decision to enter into this Assignment and
Acceptance; (iii) agrees that it will, independently and without reliance
upon the Assignor, the Agent or any other Bank and based on such documents
and information as it shall deem appropriate at the time, continue to make
its own credit decisions in taking or not taking action under the Term
Agreement; (iv) represents and warrants that it is an Eligible Assignee; (v)
appoints and authorizes the Agent to take such action as agent on its behalf
and to exercise such powers under the Term Agreement and the other Loan
Documents as are delegated to the Agent by the terms thereof, together with
such powers as are reasonably incidental thereto; and (vi) agrees that it
will perform in accordance with their terms all the obligations which by the
terms of the Term Agreement are required to be performed by it as a Bank.
4. EFFECTIVE DATE.
The effective date for this Assignment and Acceptance shall be March 31,
1998 (the "Effective Date"). Following the execution of this Assignment and
Acceptance and the consent of the Borrower hereto having been obtained, each
party hereto shall deliver its duly executed counterpart hereof to the Agent
for consent by the Agent and recording in the Register by the Agent.
5. RIGHTS UNDER TERM AGREEMENT.
Upon such acceptance and recording, from and after the Effective Date,
(i) the Assignee shall be a party to the Term Agreement and, to the extent
provided in this Assignment and Acceptance, have the rights and obligations
of a Bank thereunder, and (ii) the Assignor shall, with respect to that
portion of its interest under the Term Agreement assigned hereunder,
relinquish its rights and be released from its obligations under the Term
Agreement; provided, however, that the Assignor shall retain its rights to be
indemnified pursuant to Section 3.6 of the Term Agreement with respect to any
claims or actions arising prior to the Effective Date.
6. PAYMENTS.
Upon such acceptance of this Assignment and Acceptance by the Agent and
such recording, from and after the Effective Date, the Agent shall make all
payments in respect of the rights and interests assigned hereby (including
payments of principal, interest, fees and other amounts) to the Assignee.
7. GOVERNING LAW.
THIS ASSIGNMENT AND ACCEPTANCE IS TO BE GOVERNED BY, AND CONSTRUED IN
ACCORDANCE WITH, THE LAWS OF THE STATE OF NEW YORK, PURSUANT TO NEW YORK
GENERAL OBLIGATIONS LAW Section 5-1401.
8. COUNTERPARTS.
This Assignment and Acceptance may be executed in any number of
counterparts which shall together constitute but one and the same agreement.
IN WITNESS WHEREOF, intending to be legally bound, each of the
undersigned has caused this Assignment and Acceptance to be executed on its
behalf by its officer thereunto duly authorized, as of the date first above
written.
[ASSIGNOR]
By:_____________________________
Name:
Title:
[ASSIGNEE]
By:_____________________________
Name:
Title:
Accepted and Agreed:
BANGOR ENERGY RESALE, INC.
By:_____________________________
Name:
Title: