Exhibit 10(a)1
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AMENDED AND RESTATED CREDIT AGREEMENT
Dated as of April 17, 2003
Among
SOUTHERN POWER COMPANY
as Borrower
and
THE INITIAL LENDERS NAMED HEREIN
as Initial Lenders
and
CITIBANK, N.A.
as Administrative Agent
CITIGROUP GLOBAL MARKETS INC.
as Lead Arranger
THE BANK OF TOKYO-MITSUBISHI, LTD., NEW YORK BRANCH
as Co-Arranger and Co-Syndication Agent
BARCLAYS BANK PLC
as Co-Documentation Agent
BARCLAYS CAPITAL
as Co-Arranger
COMMERZBANK AG
as Co-Arranger and Co-Syndication Agent
ING CAPITAL LLC
as Co-Arranger and Co-Documentation Agent
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$650,000,000 Credit Facility due April 17, 2006
TABLE OF CONTENTS
Page
Article I
DEFINITIONS AND ACCOUNTING TERMS
SECTION 1.01. Certain Defined Terms............................................1
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SECTION 1.02. Computation of Time Periods.....................................33
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SECTION 1.03. Accounting Terms................................................33
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SECTION 1.04. Interpretation..................................................33
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Article II
AMOUNTS AND TERMS OF THE ADVANCES
SECTION 2.01. The Advances....................................................34
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SECTION 2.02. Making the Advances.............................................35
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SECTION 2.03. Fees 37
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SECTION 2.04. Termination or Reduction of the Commitments.....................37
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SECTION 2.05. Repayment of the Advances.......................................37
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SECTION 2.06. Interest on the Advances........................................37
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SECTION 2.07. Interest Rate Determination.....................................38
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SECTION 2.08. Optional Conversion of the Advances.............................40
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SECTION 2.09. Prepayments.....................................................40
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SECTION 2.10. Increased Costs.................................................42
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SECTION 2.11. Illegality......................................................42
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SECTION 2.12. Payments and Computations.......................................43
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SECTION 2.13. Taxes 44
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SECTION 2.14. Sharing of Payments, Etc........................................46
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SECTION 2.15. Reservation of CP Commitments...................................47
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SECTION 2.16. Use of Proceeds.................................................48
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Article III
CONDITIONS TO EFFECTIVENESS AND LENDING
SECTION 3.01. Conditions Precedent to Effectiveness of this Agreement.........49
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SECTION 3.02. [Intentionally Omitted].........................................50
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SECTION 3.03. Conditions Precedent to Subsequent Advances for an
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Initial Project..............................................................50
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SECTION 3.04. Conditions Precedent to the Initial Advances for Each
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Subsequent Project...........................................................51
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SECTION 3.05. Conditions Precedent to Subsequent Advances for a
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Subsequent Project...........................................................55
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SECTION 3.06. Conditions Precedent to CP Commitment Reservations..............56
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SECTION 3.07. Conditions Precedent to the Working Capital and CP Advances.....58
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SECTION 3.08. Determinations Under Sections 3.01 Through 3.07, Inclusive......59
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Article IV
REPRESENTATIONS AND WARRANTIES
SECTION 4.01. Representations and Warranties of the Borrower..................59
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Article V
COVENANTS OF THE BORROWER
SECTION 5.01. Affirmative Covenants...........................................62
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SECTION 5.02. Negative Covenants..............................................68
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Article VI
EVENTS OF DEFAULT
SECTION 6.01. Events of Default...............................................73
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Article VII
THE AGENT
SECTION 7.01. Authorization and Action........................................75
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SECTION 7.02. Agent's Reliance, Etc...........................................75
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SECTION 7.03. Citibank and Affiliates.........................................76
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SECTION 7.04. Lender Credit Decision..........................................76
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SECTION 7.05. Indemnification.................................................76
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SECTION 7.06. Successor Agent.................................................77
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Article VIII
MISCELLANEOUS
SECTION 8.01. Amendments, Etc.................................................77
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SECTION 8.02. Notices, Etc....................................................78
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SECTION 8.03. No Waiver; Remedies.............................................79
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SECTION 8.04. Costs and Expenses, Etc.........................................79
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SECTION 8.05. Right of Set-off................................................82
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SECTION 8.06. Binding Effect..................................................82
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SECTION 8.07. Assignments and Participations..................................82
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SECTION 8.08. Confidentiality.................................................87
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SECTION 8.09. Governing Law...................................................88
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SECTION 8.10. Execution in Counterparts.......................................88
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SECTION 8.11. Jurisdiction, Etc...............................................89
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SECTION 8.12. No Bankruptcy Proceedings.......................................89
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SECTION 8.13. Waiver of Jury Trial............................................89
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SECTION 8.14. Notes and Loan Documents........................................89
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Schedules
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Schedule I - List of Commitments and Applicable Lending Offices
Schedule II - Terms of Subordination
Schedule III - Project Limits for Initial Projects
Schedule IV - Scheduled Completion Date, Guaranteed Heat Rate and Guaranteed
Output for Each Initial Project
Schedule V - Testing Procedures and Reliability Test
Exhibits
Exhibit A - Form of Note
Exhibit B - Form of Notice of Utilization
Exhibit C - Form of Assignment and Acceptance
Exhibit D - [Intentionally Omitted]
Exhibit E - Form of Opinions of Counsel for the Loan Parties
Exhibit F - Form of Designation Agreement
Exhibit G - Form of Letter Amendment No. 1 to Equity Contribution Agreement
Exhibit H - Form of Letter Amendment No. 1 to Completion Guarantee
Exhibit I-1 - [Intentionally Omitted]
Exhibit I-2 - Form of Independent Engineer and Environmental Consultant
Certificate
Exhibit I-3 - [Intentionally Omitted]
Exhibit J-1 - [Intentionally Omitted]
Exhibit J-2 - Form of Independent Insurance Consultant Certificate
Exhibit J-3 - [Intentionally Omitted]
Exhibit K-1 - [Intentionally Omitted]
Exhibit K-2 - Form of Independent Market Consultant Certificate
Exhibit K-3 - [Intentionally Omitted]
Exhibit L-1 - Form of Substantial Completion Certificate
Exhibit L-2 - Form of Final Completion Certificate
Exhibit M - Form of Development Authority Sale/Leaseback Letter
AMENDED AND RESTATED CREDIT AGREEMENT, dated as of April 17,
2003, among SOUTHERN POWER COMPANY, a Delaware corporation (the "Borrower"), the
financial institutions listed on the signature pages of this agreement (the
"Initial Lenders") and CITIBANK, N.A. ("Citibank"), as administrative agent (the
"Agent") for the Lenders (as hereinafter defined).
PRELIMINARY STATEMENTS
WHEREAS, the Borrower, the Agent and certain other financial
institutions party thereto have heretofore entered into that certain Credit
Agreement, dated as of November 15, 2001, as amended by Letter Amendment No. 1,
dated as of April 22, 2002 and the Master Assignment and Acceptance, dated as of
the date hereof (such Credit Agreement as so amended, the "Original Credit
Agreement");
WHEREAS, the Borrower has requested certain changes or
modifications be made to the Original Credit Agreement and certain documents
related thereto;
WHEREAS, the parties to the Original Credit Agreement and such
other related documents have agreed to make such changes or modifications; and
WHEREAS, subject to the terms and conditions hereof, the
parties hereto have agreed to amend and restate the Original Credit Agreement.
NOW, THEREFORE, in consideration of the premises and the
mutual agreements contained herein, and other good and valuable consideration,
the receipt and sufficiency of which are hereby acknowledged, the parties hereto
agree to amend and restate the Original Credit Agreement in its entirety to read
as follows:
Article I
DEFINITIONS AND ACCOUNTING TERMS
SECTION 1.01. Certain Defined Terms.
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As used in this Agreement, the following terms shall have the
following meanings:
"Acceptable Credit Party" means (i) any Person whose corporate
credit rating is, or whose unsecured, non-credit enhanced long-term
debt securities are, rated not less than "BBB" and "Baa2" by S&P and
Moody's, respectively; or (ii) an Acceptable EMC Counterparty.
"Acceptable Credit Support" means, with respect to any Power
Purchase Agreement, any of the following in form and substance
reasonably satisfactory to the Majority Lenders: (a) a guaranty from an
Acceptable Credit Party; (b) an irrevocable standby letter of credit,
with a tenor not less than the term of such Power Purchase Agreement
(or, if shorter than such term, which may be drawn if not automatically
renewed prior to the stated maturity of such Power Purchase Agreement)
and issued by a financial institution organized under the laws of the
United States, or any state thereof, or the New York City branch of a
commercial bank organized under the laws of any other country that is a
member of the Organization for Economic Cooperation and Development or
has concluded special lending arrangements with the International
Monetary Fund associated with its General Arrangements to Borrow, or a
political subdivision of any such country, in each case, whose
unsecured, non-credit enhanced long-term debt securities are rated at
least "A" by S&P and "A2" by Moody's and which has a combined capital
and surplus of at least $1,000 million; or (c) any other instrument
reasonably acceptable to the Majority Lenders.
"Acceptable EMC Counterparty" means, as determined on any
date, an EMC Counterparty as to which as of such date (A) no "MAC" (as
defined in the EMC Contract with such EMC Counterparty as in effect on
the date of this Agreement) has occurred with respect thereto, (B) no
event of the type set forth in Section 6.01(f) hereof shall have
occurred and (C) no material adverse change in the membership profile
thereof shall have occurred, in each case since the date of this
Agreement, and (D) the projections for the incremental requirement
needs of such EMC Counterparty are reasonable as confirmed by the
Independent Market Consultant.
"Acceptable PPA Counterparty" means, with respect to any Power
Purchase Agreement, any Person which is (a) an Acceptable Credit Party,
or whose obligations under such Power Purchase Agreement are secured by
Acceptable Credit Support until the stated maturity of such Power
Purchase Agreement; or (b) with respect to Power Purchase Agreements
for not more than twenty percent (20%) of the total output of all
Plants only, any Person (i) whose corporate credit rating is, or whose
unsecured, non-credit enhanced long-term debt securities are, rated not
less than "BBB-" and "Baa3" by S&P and Moody's, respectively; or (ii)
whose obligations under such Power Purchase Agreement are secured by a
Person whose corporate credit rating is, or whose unsecured, non-credit
enhanced long-term debt securities are, rated not less than "BBB-" and
"Baa3" by S&P and Moody's, respectively, until the stated maturity of
such Power Purchase Agreement.
"Adjusted Project Budget" means, for each Project, the project
budget for such Project setting forth the adjusted Project Costs for
such Project (as compared to its Initial Project Budget), prepared in
the same format as its Initial Project Budget or such other format
reasonably acceptable to the Agent and certified by the Borrower to be
complete and correct, and delivered to the Agent by the Borrower at (a)
the time of any change in the Project Limit for such Project pursuant
to Section 2.01(b); and (b) the earlier of the Non-Recourse Date for
such Project and the Refinancing Date with respect to such Project.
"Advance" means an advance by a Lender to the Borrower
pursuant to Article II and refers, as the context may require, (a) to a
Base Rate Advance or a Eurodollar Rate Advance (each of which shall be
a "Type" of Advance); or (b) to a Project Advance, a Working Capital
Advance or a CP Advance (each of which shall be a "Category" of
Advance).
"Affiliate" means, as to any Person (other than an
individual), any other Person (other than an individual) that, directly
or indirectly through one or more intermediaries, Controls, is
Controlled by or is under common Control with such Person.
"Affiliate Subordinated Debt" means Debt of the Borrower which
is subordinated to the Borrower's obligations under the Facility on
terms and conditions specified in Schedule II and which is owed to or
held by an Affiliate of the Borrower other than a Subsidiary of the
Borrower.
"Agent" has the meaning set forth in the introductory
paragraph to this Agreement.
"Agent's Account" means the account of the Agent maintained by
the Agent at Citibank with its office at 2 Penns Way, Suite 200, New
Castle, DE 19720, Account No. 36852248, Attention: Dave Graber re
Southern Power Company.
"Agreement" means this agreement.
"Applicable Commitment Fee Percentage" means, as of any date
on or after April 17, 2003, a percentage per annum determined by
reference to the Rating Level in effect on such date, as set forth
below:
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Applicable Commitment Fee
Percentage
Rating Level
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Level 1 0.325%
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Level 2 0.375%
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Level 3 0.425%
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Level 4 0.500%
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Level 5 0.625%
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Level 6 0.750%
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"Amendment Effective Date" has the meaning set forth in
Section 3.01.
"Applicable Lending Office" means, with respect to each
Lender, such Lender's Domestic Lending Office in the case of a Base
Rate Advance and such Lender's Eurodollar Lending Office in the case of
a Eurodollar Rate Advance.
"Applicable Margin" means, as of any date on or after April
17, 2003:
(a) with respect to Base Rate Advances, a percentage per annum
determined by reference to the Rating Level in effect on such
date, as set forth below:
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Rating Level Applicable Margin
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Level 1 0.250%
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Level 2 0.375%
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Level 3 0.500%
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Level 4 0.750%
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Level 5 1.750%
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Level 6 2.000%
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; and
with respect to Eurodollar Rate Advances, a percentage per
annum determined by reference to the Rating Level in effect on
such date, as set forth below:
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Rating Level Applicable Margin
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Level 1 1.250%
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Level 2 1.375%
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Level 3 1.500%
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Level 4 1.750%
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Level 5 2.750%
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Level 6 3.000%
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"Arrangers" means, collectively, the Lead Arranger and the
Co-Arrangers; each individually, an "Arranger".
"Assets" means, with respect to any Person, all or any part of
its business, property and assets, both tangible and intangible,
wherever situated.
"Assignment and Acceptance" means an assignment and acceptance
entered into by a Lender and one or more Eligible Assignees (or other
Persons approved by the Borrower and the Agent), and, if required under
this Agreement, accepted by the Agent and the Borrower, in
substantially the form of Exhibit C.
"Availability Period" means the period from the Funds
Availability Date until the Final Maturity Date.
"Base Case Projections" means the Initial Base Case
Projections or, if the Agent has received any Project Base Case
Projections pursuant to Section 3.04, the then most recent Updated Base
Case Projections.
"Base Rate" means for any day, a rate per annum (rounded
upwards, if necessary, to the next 1/16 of 1%) equal to the greater of
(a) the Federal Funds Effective Rate as in effect at such time plus
0.5%; and (b) the per annum rate of interest from time to time publicly
announced by the Agent at its principal office in the United States as
its base lending rate for domestic (United States) commercial loans
(which rate may not be the lowest rate of interest charged by the Agent
in connection with extensions of credit to its other customers);
provided that (i) if for any reason the Agent shall have determined
(which determination shall be conclusive absent manifest error) that it
is unable to ascertain the Federal Funds Effective Rate for any reason,
the Base Rate shall be determined without regard to clause (a) of this
definition until the circumstances giving rise to such inability no
longer exist; and (ii) any change in the Base Rate due to a change in
the rate referred to in clause (b) of this definition or in the Federal
Funds Effective Rate shall be effective as of the opening of business
on the date of such change in the rate referred to in such clause (b)
or the Federal Funds Effective Rate, respectively.
"Base Rate Advance" means an Advance that bears interest as
provided in Section 2.06(a)(i).
"Baseload" means, on any date, an electric generation plant
which is projected (in the then most recent Independent Market
Consultant report delivered pursuant to Article III or Section 5.01(r))
to have an average Capacity Factor of 65% or more during the Remaining
Base Case Period.
"Borrower" has the meaning set forth in the introductory
paragraph to this Agreement.
"Borrower Group Members" means, collectively, the Borrower and
all Relevant Subsidiaries; each individually, a "Borrower Group
Member".
"Borrowing" means a borrowing consisting of simultaneous
Advances of the same Type and Category made by each of the Lenders
pursuant to Section 2.01.
"Borrowing Limit" means, with respect to (a) all Utilizations
for any Project, the Project Limit applicable to such Project; and (b)
all Utilizations for the Borrower's general corporate purposes or to
provide working capital for the Borrower, $50,000,000.
"Business Day" means any day other than a Saturday, Sunday or
any day on which any Lender specifically or banking institutions
generally are not required or authorized by law to close in New York
City and, if the applicable Business Day relates to any Eurodollar Rate
Advances, on which dealings in Dollars are carried on in the London
interbank market.
"Buydown Amount" means, with respect to any Substantially
Completed Project, the aggregate principal amount of all Project Debt
with respect to such Substantially Completed Project required to be
prepaid upon the occurrence of a Southern Event of Default or the
Buydown Date for such Substantially Completed Project pursuant to
Sections 2.09(b)(i)(B) and 2.09(b)(ii)(B), respectively, in each case,
so as to result in the minimum and average Portfolio Adjusted Base Case
Projections, calculated on the assumptions that (a) all Recourse Debt
of the Borrower Group Members (other than Recourse Debt incurred with
respect to Uncompleted Plants) outstanding immediately after such
prepayment is repaid in full on or prior to the end of the Remaining
Base Case Period; and (b) all liquidated damages for completion of such
Substantially Completed Project at a reduced capacity from that
contracted for under each Power Purchase Agreement for such
Substantially Completed Project which are then payable or which, after
the date of determination, would become payable as a result thereof (in
each case, calculated by reference to the performance of such
Substantially Completed Plant, as certified by Southern to the Agent
for purposes of its Substantial Completion), are paid in full when due.
If on any date the Buydown Amount for more than one Substantially
Completed Project is to be calculated, for purposes of calculating the
Buydown Amount for each such Substantially Completed Project, all other
Substantially Completed Projects shall be deemed to be Uncompleted
Projects.
"Buydown Date" means, with respect to any Project, the date
which is twenty-four (24) months after the Scheduled Completion Date
for such Project, or such earlier date as may be notified in writing to
the Agent by Southern.
"Buydown Event" means, with respect to any Project which
achieves Substantial Completion, the occurrence of the Buydown Date for
such Project before such Project achieves Final Completion.
"Capacity Factor" means, with respect to an electric
generation plant in connection with determining the Required Project
DSCR applicable to such plant at any time, the ratio, expressed as a
percentage, of (a) the total electrical energy expected to be generated
by such electric generation plant during the relevant period, as
projected in the then most recent Independent Market Consultant report
delivered pursuant to Article III or Section 5.01(r), to (b) the
maximum possible electrical energy such electric generation plant could
have generated during such period if operated at its maximum capacity
rating, (i) as determined for purposes of the Power Purchase Agreement
in effect with respect to such electric generation plant at such time,
if any (or, if there is more than one such Power Purchase Agreement,
the lowest such output under all such Power Purchase Agreements); or
(ii) if there is no such Power Purchase Agreement then in effect, as
determined as of the Non-Recourse Date for such Project.
"Cash Available for Corporate Debt Service" for any period
means, without duplication, (a) cash earnings from operations prior to
interest, principal and tax payments based on income with reference to
the Borrower's consolidated financial statements (but excluding any
such cash earnings attributable to Unrestricted Subsidiaries); plus (b)
cash received (net of transaction costs and expenses) during such
period by the Borrower and its consolidated Subsidiaries (other than
Unrestricted Subsidiaries) from Sales or other dispositions of Assets
not required to prepay Debt; plus (c) cash received by the Borrower
from Southern in the form of equity contributions (other than Equity
Contributions) or Affiliate Subordinated Debt, which cash is received
during such period; plus (d) cash dividends or cash distributions
received by the Borrower from Unrestricted Subsidiaries.
"Category" has the meaning specified in the definition of
"Advance".
"Citibank" has the meaning set forth in the introductory
paragraph to this Agreement.
"Co-Arrangers" means The Bank of Tokyo-Mitsubishi, Ltd., New
York Branch, Barclays Capital, Commerzbank AG, and ING Capital LLC.
"Code" means the Internal Revenue Code of 1986, as amended
from time to time.
"Commercial Paper" means commercial paper issued by the
Borrower (a) rated at least "A-2" or better by S&P and at least "P-2"
or better by Moody's; (b) having a maturity not exceeding 180 days from
its issuance and occurring on or before the Final Maturity Date; and
(c) the obligations with respect to which are not secured by any Liens
or subject to any form of credit enhancement other than liquidity
support provided pursuant to this Facility.
"Commitment" has the meaning specified in Section 2.01.
"Commitment Termination Date" means the date on which the
Commitments of all Lenders have been terminated or cancelled in
accordance with this Agreement.
"Completed Plants" means, as at any relevant time, (a) all
Projects which (i) have then achieved Final Completion; or (ii) have
then achieved Substantial Completion, the relevant Buydown Dates for
which have occurred and for which the relevant Buydown Amounts, if
required, have been paid; and (b) all other Plants which have then
commenced commercial operation and achieved Substantial Completion.
"Completed Project Advances" means, at any time, all Advances
then outstanding with respect to Completed Projects; each individually,
a "Completed Project Advance".
"Completed Projects" means all Projects the Non-Recourse Date
for which has occurred; each individually, a "Completed Project".
"Confidential Information" has the meaning specified in
Section 8.08.
"Contracted Operating Cash Flow" means the projection done at
the end of each fiscal quarter of the next four fiscal quarters of the
Borrower's and the Borrower's Subsidiaries' (other than Unrestricted
Subsidiaries) total cash flow available for debt service from
fixed-price capacity power contracts, each such contract having a term
from initial commencement to expiry of at least five years; provided,
however, that up to 12.5% of the Contracted Operating Cash Flow may be
derived from fixed-price capacity power contracts that have contract
terms of at least two years but less than five years from initial
commencement to expiry. The projection shall be consistent with the
Borrower's financial reporting procedures. The term fixed-price
capacity power contract includes any power contract that states the
base capacity price on a per unit basis (for example, in dollars per
megawatt) and which may allow for adjustments to that base price that
are generally encompassed with the Borrower's or the electric
generation industry's commercial expectations for a power contract of a
similar duration (including but not limited to adjustments to
accommodate changed capacity purchase levels, variations in expected or
actual construction costs or demonstrated capability levels, changes in
equipment or law and force majeure); provided, however, that a power
contract will not be considered to be a fixed-price capacity power
contract if a material portion of the capacity price varies based upon
a market index for electric capacity or energy, fuel, weather or other
factor that is external to the facility and the transaction between the
Borrower and the Borrower's customer. The method of calculating the
energy price shall not be considered in assessing whether a power
contract is a fixed-price capacity power contract.
"Control" has the meaning set forth in rule 12b-2 promulgated
under the Securities Exchange Act of 1934.
"Controlled Group" means (a) the controlled group of
corporations as defined in Section 414(b) of the Code and the
applicable regulations thereunder; or (b) the group of trades or
businesses under common control as defined in Section 414(c) of the
Code and the applicable regulations thereunder, of which the Borrower
is a part or may become a part.
"Convert", "Conversion" and "Converted" each refers to a
conversion of Advances of one Type into Advances of the other Type
pursuant to Section 2.07 or 2.08.
"Corporate Interest" means, for any period, the sum of (a) the
aggregate of interest expense accrued during such period by the
Borrower and the Relevant Subsidiaries on Recourse Debt less the amount
of interest, if any, included in such interest expense which was
capitalized in accordance with GAAP, plus (b) to the extent not
included in clause (a), rent or similar payments on Recourse Debt
consisting of Finance Leases, capital leases, sale-leasebacks that are
capitalized in accordance with GAAP, Synthetic Leases, all
amortizations of the discount on Debt issued at discount, or other
similar arrangements.
"CP Advance" has the meaning specified in Section 2.16.
"CP Commitment" has the meaning specified in Section 2.15.
"CP Commitment Reservation" means the simultaneous creation of
CP Commitments by each of the Lenders pursuant to Section 2.15, and
refers, as the context may require, to a CP Commitment (Original CP)
Reservation or a CP Commitment (Refinancing CP) Reservation (each of
which shall be a "Kind" of CP Commitment Reservation).
"CP Commitment (Original CP) Reservation" means a CP
Commitment Reservation which is made with respect to Original
Commercial Paper.
"CP Commitment (Refinancing CP) Reservation" means a CP
Commitment Reservation which is made with respect to Refinancing
Commercial Paper.
"Dahlberg Project" means the ten unit, approximately 810MW
gas-fired electric generation plant constructed by Georgia Power
Company and located in Jackson County, Georgia.
"Debt" means for any Person any obligations of such Person for
or in respect of (a) moneys borrowed or raised (whether or not for
cash) by whatever means (including acceptances, deposits, discounting,
letters of credit, factoring (other than on a non-recourse basis),
Finance Leases, Lease Obligations and any other form of financing which
is recognized in accordance with GAAP in such Person's financial
statements as being in the nature of a borrowing (excluding for the
avoidance of doubt, share capital, share premium account and any
capital prepayment reserve) or is treated as "off-balance" sheet
financing (including all amounts financed under any Synthetic Lease or
other synthetic financing transaction (excluding, in the case of any
Person other than Southern, such portion of such amounts for which
Southern is also directly liable and such portion of such amounts equal
to any committed equity amounts from Southern in respect thereof) and
all minority equity investments)); (b) the deferred purchase price of
Assets or services (other than goods and services obtained on normal
commercial terms in the ordinary course of business or operations); and
(c) guarantees by such Person of obligations which constitute Debt of
another Person under clause (a) or (b) above; provided that (i) for any
Subsidiary of the Borrower, "Debt" shall not include any such
obligation owed to the Borrower or to any Relevant Subsidiary; (ii)
except for purposes of Section 6.01(d), "Debt" shall not include any
obligations in connection with Trust Preferred Securities; and (iii)
with respect to the Borrower, "Debt" for purposes of Section 5.01(a)
shall not include up to $10,000,000 of obligations, in the aggregate
amount at any time outstanding, which are secured by Liens referred to
in any of paragraphs (iv), (vii), (viii), (ix), (xv) and (xvi) of
Section 5.02(c).
"Debt/Equity Ratio" means with respect to any (a) Initial
Project, 65:35; and (b) Subsequent Project, the ratio of (i) the
Project Limit for such Project to (ii) the amount by which the Project
Costs for such Project (as set forth in its Project Budget) exceeds
such Project Limit.
"Default" means any Event of Default or any event that would
constitute an Event of Default but for the requirement that notice be
given or time elapse or both.
"Designated Lender" means a special purpose corporation that
is identified as such on the signature pages of this Agreement, as well
as each special purpose corporation that (a) shall have become a party
to this Agreement pursuant to Section 8.07(i); and (b) is not otherwise
a Lender.
"Designated Lender Note" means a Note evidencing the
obligation of the Borrower to repay Advances made by a Designated
Lender.
"Designating Lender" means each Lender that is identified as
such on the signature pages of this Agreement, as well as each Lender
that shall designate a Designated Lender pursuant to Section 8.07(i).
"Designation Agreement" means a designation agreement in
substantially the form of Exhibit F, entered into by a Lender and a
Designated Lender and accepted by the Agent.
"Development Authority Sale/Leaseback" means (a) the Wansley
Sale/Leaseback; and (b) any sale of a Project (other than the Wansley
Project) to a development authority created and existing under the laws
of the State of Georgia (or any political sub-division thereof), where
(i) such development authority is a political sub-division or agency of
a local government of the State of Georgia; (ii) the purchase price for
such Project is paid for with proceeds from the issuance of Project
Bonds which are purchased by the Borrower or a wholly owned Subsidiary
of the Borrower; (iii) such Project is leased by a Borrower Group
Member which has the right to purchase such Project at any time at a
nominal purchase price so long as all Project Bonds relating thereto
have been repaid in full, (iv) Southern has issued a support letter in
the form of Exhibit M; and (v) all such Project Bonds are issued at par
with a repayment or maturity date which is subsequent to the Final
Maturity Date and with no amortization of the Debt thereunder occurring
prior thereto.
"Dollars" means the lawful currency of the United States.
"Domestic Lending Office" means, with respect to any Lender,
the office of such Lender specified as its "Domestic Lending Office"
opposite its name on Schedule I or in the Assignment and Acceptance
pursuant to which it became a Lender, or such other office of such
Lender as such Lender may from time to time specify to the Borrower and
the Agent.
"Eligible Assignee" means (a) a Lender; (b) an Affiliate of a
Lender; (c) a commercial bank organized under the laws of the United
States, or any State thereof; (d) a savings and loan association or
savings bank organized under the laws of the United States, or any
State thereof; (e) a commercial bank organized under the laws of any
other country that is a member of the Organization for Economic
Cooperation and Development or has concluded special lending
arrangements with the International Monetary Fund associated with its
General Arrangements to Borrow, or a political subdivision of any such
country, so long as such bank is acting through a branch or agency
located in the country in which it is organized or another country that
is described in this clause (e); (f) a finance company, insurance
company or other financial institution or fund (whether a corporation,
partnership, trust or other entity) that is engaged in making,
purchasing or otherwise investing in commercial loans in the ordinary
course of its business; and (g) the central bank of any country that is
a member of the Organization for Economic Cooperation and Development;
provided that neither the Borrower nor an Affiliate of the Borrower
shall qualify as an Eligible Assignee; provided further that the
entities listed in clauses (c)-(g) above shall have a short-term credit
rating of at least "Prime-2" (or the then equivalent grade) by Moody's
or "A-2" (or the then equivalent grade) by S&P or "F-2" (or the then
equivalent grade) by Fitch, or, if no short-term credit rating is
available, a long-term credit rating of at least "Baa2" (or the then
equivalent grade) by Moody's or "BBB" (or the then equivalent grade) by
S&P or Fitch; provided further that if any entity listed in clause (g)
above shall have no short-term or long-term credit rating, the relevant
credit rating shall be the short-term or long-term credit rating of the
country of which such entity is the central bank.
"EMC Contracts" means the following Power Purchase Agreements:
Requirements Service Agreement between the Borrower and Carroll
Electric Membership Corporation dated as of February 28, 2002;
Requirements Service Agreement between the Borrower and Coweta-Fayette
Electric Membership Corporation dated as of February 28, 2002;
Requirements Service Agreement between the Borrower and Flint Electric
Membership Corporation dated as of February 28, 2002; Requirements
Service Agreement between the Borrower and Irwin Electric Membership
Corporation dated as of February 28, 2002; Requirements Service
Agreement between the Borrower and Lamar Electric Membership
Corporation dated as of February 28, 2002; Requirements Service
Agreement between the Borrower and Middle Georgia Electric Membership
Corporation dated as of February 28, 2002; Requirements Service
Agreement between the Borrower and Oconee Electric Membership
Corporation dated as of February 28, 2002; Requirements Service
Agreement between the Borrower and Ocmulgee Electric Membership
Corporation dated as of February 28, 2002; Requirements Service
Agreement between the Borrower and Tri-County Electric Membership
Corporation dated as of February 28, 2002; Requirements Service
Agreement between the Borrower and Sawnee Electric Membership
Corporation dated as of February 28, 2002; and Requirements Service
Agreement between the Borrower and Okefenoke Rural Electric Membership
Corporation dated as of February 28, 2002, which Power Purchase
Agreements shall be applicable to such Plant(s) or Project(s) as
identified by the Borrower.
"EMC Counterparty" means each of Carroll Electric Membership
Corporation, Coweta-Fayette Electric Membership Corporation, Flint
Electric Membership Corporation, Irwin Electric Membership Corporation,
Lamar Electric Membership Corporation, Middle Georgia Electric
Membership Corporation, Oconee Electric Membership Corporation,
Ocmulgee Electric Membership Corporation, Tri-County Electric
Membership Corporation, Sawnee Electric Membership Corporation and
Okefenoke Rural Electric Membership Corporation, counterparties to the
EMC Contracts.
"Equity Contributions" means, with respect to any Project, (a)
all equity contributed to the Borrower by Southern with respect to such
Project, if any, which, if contributed after the date of this
Agreement, is contributed pursuant to the Southern Equity Agreement;
and (b) all retained earnings of the Borrower available for the making
of a Restricted Payment in accordance with Section 5.02(b), if any,
which are applied to pay outstanding Project Costs with respect to such
Project.
"ERISA" means the Employee Retirement Income Security Act of
1974, as amended from time to time, and the regulations promulgated and
the rulings issued thereunder.
"ERISA Affiliate" means each person (as defined in Section
3(9) of ERISA) which together with the Borrower or any Subsidiary of
the Borrower would be deemed to be a member of the same "controlled
group" within the meaning of Sections 414(b), (c), (m) and (o) of the
Code.
"Eurocurrency Reserve Requirements" means for any day as
applied to a Eurodollar Rate Advance, the aggregate (without
duplication) of the rates (expressed as a decimal fraction) of reserve
requirements in effect on such day (including basic, supplemental,
marginal and emergency reserves under any regulations of the Board of
Governors of the Federal Reserve System or other Governmental Authority
having jurisdiction with respect thereto) dealing with reserve
requirements prescribed for eurocurrency funding (currently referred to
as "Eurocurrency Liabilities") in Regulation D of such Board maintained
by a member bank of such System.
"Eurodollar Base Rate" means, with respect to each day during
each Interest Period pertaining to a Eurodollar Rate Advance, the rate
per annum equal to the average (rounded upward, if necessary, to the
nearest 1/16 of 1%) of the respective rates notified to the Agent by
each of the Reference Banks as the rate at which such Reference Bank is
offered Dollar deposits at or about 11:00 A.M., London time, two
Business Days prior to the beginning of such Interest Period in the
London interbank eurodollar market for delivery on the first day of
such Interest Period, for the number of days comprised therein and in
an amount comparable to the amount of its Eurodollar Rate Advance to be
outstanding during such Interest Period.
"Eurodollar Lending Office" means, with respect to any Lender,
the office of such Lender specified as its "Eurodollar Lending Office"
opposite its name on Schedule I or in the Assignment and Acceptance
pursuant to which it became a Lender (or, if no such office is
specified, its Domestic Lending Office), or such other office of such
Lender as such Lender may from time to time specify to the Borrower and
the Agent.
"Eurodollar Rate" means with respect to each day during each
Interest Period pertaining to a Eurodollar Rate Advance, a rate per
annum determined for such day in accordance with the following formula
(rounded upward, if necessary, to the nearest 1/100 of 1%):
Eurodollar Base Rate
1.00 - Eurocurrency Reserve Requirements
"Eurodollar Rate Advance" means an Advance that bears interest
as provided in Section 2.06(a)(ii).
"Events of Default" has the meaning specified in Section 6.01.
"Exempt Asset Sale Proceeds" means the proceeds from any sale
of Assets (a) in the ordinary course, which sale would not reasonably
be expected to result in a material adverse effect to the operation and
maintenance of the Projects; (b) other than Assets relating to any
Project, to conform with governmental regulations; (c) consisting of
short-term readily marketable investments purchased for cash management
purposes; or (d) owned by an Unrestricted Subsidiary.
"Facility" means the senior unsecured revolving credit
facility made or to be made available by the Lenders to the Borrower
under this Agreement.
"Facility Rating" means, as of any date, the credit rating
then in effect by S&P or Moody's as the case may be, for the Debt under
the Facility, as demonstrated by written evidence delivered to the
Agent which is in form and substance reasonably satisfactory to the
Agent.
"Federal and State Energy Law and Regulation" includes the
Federal Power Act, as amended, the Public Utility Regulatory Policies
Act of 1978, as amended, the Powerplant and Industrial Fuel Use Act of
1978, as amended, the Public Utility Holding Company Act of 1935, as
amended, the Energy Policy Act of 1992, as amended, any State law
regulating public utility companies, electric utilities, public service
companies, or any similar entity, as well as any regulation
implementing any of the foregoing.
"Federal Funds Effective Rate" means, with respect to each
day, the rate per annum (rounded upwards, if necessary, to the nearest
1/100th of 1%) equal to the weighted average of the rates on overnight
federal funds transactions with members of the Federal Reserve System
arranged by federal funds brokers on such day, as published by the
Federal Reserve Bank of New York on the Business Day next succeeding
such day; provided that (a) if such day is not a Business Day, the
Federal Funds Effective Rate for such day shall be such rate on such
transactions on the next preceding Business Day as so published on the
next succeeding Business Day; and (b) if no such rate is so published
on such next succeeding Business Day, the Federal Funds Effective Rate
for such day shall be the average rate quoted to the Agent on such day
on such transactions as the Agent may reasonably determine.
"FERC" means the Federal Energy Regulatory Commission.
----
"Filing Condition" means, with respect to any order, approval,
permit or authorization issued by FERC, (a) a ministerial subsequent
filing, reporting or notification condition customarily imposed on
sellers with market-based rate approval from FERC; or (b) with respect
to a Power Purchase Agreement only, a condition that an unredacted
version of such contract be filed on a non-confidential basis but with
the requirement to make such filing held in abeyance pending resolution
of a proceeding as to whether a redacted or unredacted version of such
Power Purchase Agreement is to be filed on a non-confidential basis.
"Final Completion" means the date on which Southern certifies
in the form of Exhibit L-2 to the Agent that, in the case of (a) any
Project, (i) such Project has achieved Substantial Completion; and (ii)
the tested output in megawatts for such Project has achieved 100% of
its Guaranteed Output and such Project has achieved a tested heat rate
not greater than 100% of its Guaranteed Heat Rate, in each case, as set
forth in the Project Schedule for such Project and as tested in
accordance with the testing procedures applicable to such Project set
forth in, or determined in accordance with, Schedule V; and (b) any
other electric generation plant owned or leased by the Borrower or any
Relevant Subsidiary, the equivalent thereof has occurred.
"Final Maturity Date" means April 17, 2006.
"Finance Lease" means, for any Person, any lease, or any hire
purchase, conditional sale or other form of title retention agreement
which is recognized, in accordance with GAAP, in such Person's
financial statements as being in the nature of a borrowing.
"Fitch" means Fitch IBCA, Duff & Phelps, a division of Fitch,
Inc.
"Franklin 1 Project" means the approximately 571MW gas-fired
electric generation plant constructed or to be constructed by the
Borrower or an Affiliate of the Borrower in Lee County, Alabama.
"Franklin 2 Project" means the approximately 615MW gas-fired
electric generation plant constructed or to be constructed by the
Borrower or an Affiliate of the Borrower in Lee County, Alabama.
"Franklin 3 Plant" means the approximately 620 MW gas-fired
electric generation plant constructed or to be constructed by the
Borrower or an Affiliate of the Borrower in Lee County, Alabama.
"Funds Availability Date" has the meaning specified in Section
3.01 of the Original Credit Agreement.
"Generally Accepted Accounting Principles" or "GAAP" means
those accounting principles, standards and practices generally accepted
in the United States consistent with those applied by the Borrower, as
in effect at the relevant time.
"Governmental Authority" means any nation or government, any
state, province or other political subdivision thereof, and any
governmental, executive, legislative, judicial, administrative or
regulatory agency, department, authority, instrumentality, commission,
board or similar body, whether federal, state, provincial, territorial,
local or foreign.
"Granting Lender" has the meaning specified in Section
8.07(j).
"Guaranteed Heat Rate" means, with respect to (a) any Initial
Project, the average heat rate associated with such Project while
operating in base mode (namely, at 100% combustion turbine load) at the
average ambient rated conditions for such Project, as set forth in
Schedule IV; and (b) any Subsequent Project, the average heat rate
associated with such Project, as set forth in the Project Schedule
delivered pursuant to Section 3.04 for such Project, while operating in
the mode of operation and at the rated conditions set forth therein.
"Guaranteed Output" means, with respect to (a) any Initial
Project, the capability of such Project with all possible modes of
operation in use at rated summer conditions for such Project, including
the following: operation in base load (namely, 100% combustion turbine
load), full pressure operation, evaporative cooling, and power
augmentation modes, as set forth in Schedule IV; and (b) any Subsequent
Project, the capability of such Project, as set forth in the Project
Schedule delivered pursuant to Section 3.04 for such Project, while
operating in the mode of operation and at the rated conditions set
forth therein.
"Harris 1 Project" means the approximately 618MW gas-fired
electric generation plant constructed or to be constructed by the
Borrower or an Affiliate of the Borrower in Autauga County, Alabama,
and which is not the Harris 2 Project.
"Harris 2 Project" means the approximately 618MW gas-fired
electric generation plant constructed or to be constructed by the
Borrower or an Affiliate of the Borrower in Autauga County, Alabama,
and which is not the Harris 1 Project.
"Indemnified Costs" has the meaning specified in Section 7.05.
"Indemnified Party" has the meaning specified in Section
8.04(b)(i).
"Independent Engineer and Environmental Consultant" means R.W.
Beck, Inc. or any successor consultant appointed by the Agent and
reasonably acceptable to the Borrower.
"Independent Insurance Consultant" means Marsh USA Inc. or any
successor consultant appointed by the Agent and reasonably acceptable
to the Borrower.
"Independent Market Consultant" means PA Consulting, Inc. or any
successor consultant appointed by the Agent and reasonably acceptable
to the Borrower.
"Information Memorandum" means the information memorandum
dated February 18, 2003 and used by the Arrangers in connection with
the syndication of the Commitments by the Arrangers (excluding,
however, the report of the Independent Market Consultant and the
Independent Engineer, and the information in such information
memorandum the source of which is identified as the report of the
Independent Market Consultant or the Independent Engineer).
"Initial Base Case Projections" means a projection prepared by
the Borrower of the operating results for the Initial Projects for a
period from the date of this Agreement up to and including December 31,
2023.
"Initial Lenders" has the meaning set forth in the
introductory paragraph to this Agreement.
"Initial Project Budget" means, for each Project, the project
budget setting forth the Projects Costs incurred or to be incurred for
such Project delivered to the Agent by the Borrower prior to the first
Utilization related to such Project pursuant to Section 3.01 or 3.02 of
the Original Credit Agreement or Section 3.06 hereof, as applicable (in
the case of an Initial Project) or Section 3.04 or 3.06 hereof, as
applicable (in the case of a Subsequent Project).
"Initial Project Limit" means, with respect to each Project,
the aggregate amount of all Utilizations related to such Project that
is permitted under this Agreement, which amount with respect to (a)
each Initial Project, is set forth in Schedule III; and (b) each
Subsequent Project, shall be calculated by the Borrower (and agreed to
by the Agent) based upon the Initial Project Budget and the Project
Base Case Projections for such Project as the maximum principal amount
of Utilizations permitted with respect to such Project, such
determination to be consistent with the Required Project DSCR for such
Project (but which shall not, in any event, exceed 65% of the Project
Costs, as set forth in the Initial Project Budget for such Project).
"Initial Projects" means, collectively, the Harris 1 Project,
the Harris 2 Project, the Dahlberg Project, the Franklin 1 Project, the
Franklin 2 Project and the Wansley Project, in each case, owned or
leased (pursuant to a Development Authority Sale/Leaseback) by the
Borrower, and including all buildings, structures and improvements, and
easements with respect thereto, all alterations thereto or replacements
thereof, all fixtures, attachments, appliances, equipment, machinery
and other articles attached thereto or used in connection therewith and
all parts which may from time to time be incorporated or installed in
or attached thereto, all contracts and agreements for the purchase or
sale of commodities or other personal property related thereto, all
leases of personal property related thereto, and all other real and
tangible and intangible personal property related thereto; each
individually, an "Initial Project".
"Insurance Account" means an account of the Borrower
established with the Agent pursuant to Section 5.01(l)(ii) and
maintained with the Agent for purposes of holding Loss proceeds (other
than business interruption insurance proceeds) in excess of $1,000,000,
which are, or may become, payable with respect to Completed Projects.
"Interest Period" means, for each Eurodollar Rate Advance
comprising part of the same Borrowing, the period commencing on the
date of such Eurodollar Rate Advance or the date of the Conversion of
any Base Rate Advance into such Eurodollar Rate Advance and ending on
the last day of the period selected by the Borrower pursuant to the
provisions below and, thereafter with respect to each Eurodollar Rate
Advance, each subsequent period commencing on the last day of the
immediately preceding Interest Period and ending on the last day of the
period selected by the Borrower pursuant to the provisions below. The
duration of each such Interest Period shall be one (1), two (2), three
(3) or six (6) months, or such other period agreed between the Borrower
and the Agent (acting on the instructions of all Lenders), as the
Borrower may, upon notice received by the Agent not later than 11:00
A.M. (New York City time) on the third Business Day prior to the first
day of such Interest Period, select; provided that:
(a) the Borrower may not select any Interest Period that ends
after the Final Maturity Date;
(b) Interest Periods commencing on the same date for Eurodollar
Rate Advances comprising part of the same Borrowing shall be
of the same duration;
(c) whenever the last day of any Interest Period would otherwise
occur on a day other than a Business Day, such Interest Period
shall be extended to end on the next succeeding Business Day;
provided that if such extension would cause the last day of
such Interest Period to occur in the next following calendar
month, the last day of such Interest Period shall occur on the
next preceding Business Day;
(d) whenever the first day of any Interest Period occurs on a day
of an initial calendar month for which there is no numerically
corresponding day in the calendar month that succeeds such
initial calendar month by the number of months equal to the
number of months in such Interest Period, such Interest Period
shall end on the last Business Day of such succeeding calendar
month; and
(e) no more than six (6) different Interest Periods may exist
concurrently with respect to all outstanding Advances of each
Category.
"Intermediate (High)" means, on any date, any electric
generation plant which is projected, in the then most recent
Independent Market Consultant report delivered pursuant to Article III
or Section 5.01(r), to have an average Capacity Factor of 45% or more,
but less than 65%, in each case, during the Remaining Base Case Period.
"Intermediate (Low)" means, on any date, any electric
generation plant which is projected, in the then most recent
Independent Market Consultant report delivered pursuant to Article III
or Section 5.01(r), to have an average Capacity Factor of 20% or more,
but less than 45%, in each case, during the Remaining Base Case Period.
"Investment Grade Rating" means (a) with respect to any Person
other than the Borrower, a rating of any class of its
non-credit-enhanced long-term senior unsecured Debt of at least "Baa3"
by Moody's and "BBB-" by S&P; and (b) with respect to the Borrower, a
rating of the Debt under the Facility (giving effect to the Southern
Completion Guarantee) of at least "Baa3" by Moody's and "BBB-" by S&P.
"Kind" has the meaning specified in the definition of "CP
Commitment Reservation".
"Law" means any constitution, decree, judgment, legislation,
order, ordinance, regulation, statute, treaty or other legislative
measure having the force of law (and "lawful" and "unlawful" shall be
construed accordingly).
"Lead Arranger" means Citigroup Global Markets Inc.
-------------
"Lease Obligations" means, with respect to any Person who is a
lessee under any lease which is not a Synthetic Lease or a Finance
Lease, the present value of all payment obligations (without
double-counting) that are in the nature of a rental payment obligation
or are otherwise not avoidable at the option of the lessee without
incurring other costs or risks (including for this purpose purchase
rights for which the failure to exercise results in other payment
obligations and guarantees of value) such Person may have under such
lease and related documents, provided that (i) payments which such
Person may be entitled unilaterally to determine not to pay without
incurring other payment obligations, (ii) termination value obligations
which may be due if events not expected to happen occur (but not
excluding any which are expected to be payable), and (iii) indemnity
obligations, shall not be included in the meaning of "Lease
Obligations". For this purpose, the present value of such "Lease
Obligations" with respect to any such lease shall equal the amount
obtained by discounting all relevant obligations from their respective
due dates to the date of determination in accordance with accepted
financial practice and at a discount factor of 10% per annum.
"Lenders" means the Initial Lenders, each Person that shall
become a party to this Agreement pursuant to Section 8.07(a) and the
Designated Lenders, if any; provided that the term "Lender" shall
exclude each Designated Lender when used in reference to an Advance
(except to the extent a Designated Lender is the obligee of an Advance
actually funded by it pursuant to Section 2.01(c)), terms relating to
the Advances (except as noted above) and the Commitments.
"Lien" means any mortgage, pledge, lien, hypothecation,
security interest or other charge, encumbrance or other arrangement in
the nature of a security interest in property; provided that the term
"Lien" shall not mean any easements, rights-of-way, zoning
restrictions, leases, subleases, licenses, sublicenses, other
restrictions on the use of property, defects in title to property or
other similar encumbrances, in each case, that do not interfere
materially with the use of such property for its intended purpose.
"Liquidity Lender" means, with respect to any Designated
Lender, any Person (other than its Designating Lender) which may be
liable for the Debt of such Designated Lender.
"Loan Documents" means, collectively, this Agreement, the
Notes, the Southern Completion Guarantee and the Southern Equity
Agreement; each individually, a "Loan Document".
"Loan Parties" means, collectively, the Borrower and Southern;
each individually, a "Loan Party".
"Loss" means, with respect to any Completed Project (a) any
total or partial loss, as a result of a casualty of such Project; or
(b) if such Project (or a substantial portion thereof) is condemned,
seized, compulsorily acquired or otherwise expropriated by any
Governmental Authority under power of eminent domain.
"Majority Lenders" means at any time Lenders owed at least a
majority of the then aggregate unpaid principal amount of the Advances
owing to the Lenders, or, if no such principal amount is then
outstanding, Lenders having at least a majority of the aggregate amount
of the Commitments.
"Master Assignment and Acceptance" means the Master Assignment
and Acceptance, dated as of the date hereof among the Borrower, the
Agent and the financial institutions party thereto.
"Material Adverse Effect" means a material adverse change in,
or material adverse effect on, (a) the financial condition, operations,
business or properties of the Borrower or Southern, as the case may be,
which would have a material adverse effect on the ability of the
Borrower or Southern to pay amounts owed by, or to perform obligations
of, the Borrower from time to time under any Loan Document, or Southern
under the Southern Completion Guarantee or the Southern Equity
Agreement, as the case may be; or (b) the rights or remedies of the
Lenders under, or the validity, enforceability or legality of, any Loan
Document.
"Material Documents" means the Loan Documents and the PPA
Documents.
"Mechanical Completion" means, with respect to any electric
generation plant owned or to be owned, or leased or to be leased, by a
Borrower Group Member (including the Projects), the time at which the
construction manager for such plant certifies to the Borrower (a) that
all construction work for such plant is complete according to the
proper scope of work and such plant is ready for performance testing
with the exception of Punch List Items; (b) of the satisfactory
completion of the materials and equipment associated with individual
turnover packages (all items within the turnover package shall be
completed to the satisfaction of the Borrower's start-up or testing
manager, all equipment shall be capable of operation in a safe and
proper manner without voiding warranties, all equipment systems
installed associated with the turnover package, including remote
control systems, shall be ready to commence start-up and testing) and
the satisfactory completion and documentation of the construction
completion testing; and (c) of the removal of all construction,
temporary facilities that may interfere with or disrupt the Borrower's
start-up and plant testing activities, waste material and rubbish from
the work area.
"Moody's" means Moody's Investors Service, Inc.
"Nature" means, with respect to any Advance, a Completed
Project Advance or an Uncompleted Project Advance, as the context may
require.
"Non-Recourse Date" means, with respect to any Project, the
earlier to occur of Final Completion of, and the Buydown Date (but, if
a Buydown Amount is payable with respect to such Project, only if the
Buydown Amount has been paid) for, such Project.
"Note" means a promissory note of the Borrower payable to the
order of any Lender, in substantially the form of Exhibit A, evidencing
the aggregate maximum indebtedness of the Borrower to such Lender
resulting from the Advances made by such Lender.
"Notice of Utilization" has the meaning specified in Section
2.02(a).
"Original Commercial Paper" means Commercial Paper other than
(a) Refinancing Commercial Paper; or (b) Rollover Commercial Paper.
"Original Credit Agreement" has the meaning set forth in
Preliminary Statement (1) to this Agreement.
"Other Taxes" has the meaning specified in Section 2.13(a).
"Participant" means any Person to whom a participation has
been granted by a Lender of its rights and obligations under this
Agreement pursuant to Section 8.07(f).
"Peaker" means (a) a quickstart gas-fired simple cycle
electric generation plant; or (b) on any date, any electric generation
plant which is projected, in the then most recent Independent Market
Consultant report delivered pursuant to Article III or Section 5.01(r),
to have an average Capacity Factor of less than 20% during the
Remaining Base Case Period.
"Permitted Encumbrances" shall mean liens for taxes not yet
due and payable or being contested in good faith, mechanics' and
similar liens arising or incurred in the ordinary course of business
and representing obligations not yet due, and such other liens,
imperfections in or failure of title, charges, easements, restrictions
and encumbrances which do not materially detract from the value of the
Projects for their contemplated use or materially interfere with the
contemplated use thereof.
"Person" means any individual, company, corporation, firm,
partnership, joint venture, undertaking, association, organization,
trust, state or agency of a state (in each case, whether or not having
separate legal personality).
"Plan" means any single-employer plan as defined in Section
4001 of ERISA and to which ERISA applies, which is maintained, or at
any time during the five (5) calendar years preceding the date of this
Agreement was maintained, for employees of the Borrower, any Subsidiary
of the Borrower or an ERISA Affiliate.
"Plants" means the Projects and other electric generation
plants owned or leased by the Borrower or any Relevant Subsidiary.
"Portfolio Adjusted Base Case Projections" means, with respect
to any Relevant Event, the weighted average of each of the minimum
Required Project DSCRs (for each year, or part thereof, during the
Remaining Base Case Period) and the average Required Project DSCRs (for
the Remaining Base Case Period) applicable, in each case, to all
Relevant Completed Plants immediately after such Relevant Event, with
such weighted average determined, in each case, based upon the cash
earnings from operations (after all operating expenses but prior to
interest and principal payments and income taxes) for each such
Relevant Completed Plant during the Remaining Base Case Period,
determined (a) with respect to each Plant which has achieved (i)
Substantial Completion but not Final Completion, by reference to the
performance of such Plant, as certified by Southern to the Agent for
purposes of its Substantial Completion; and (ii) Final Completion, by
reference to the performance of such Plant, as certified by Southern to
the Agent for purposes of its Final Completion; and (b) using the
figures in an updated Independent Market Consultant report provided in
connection with such Relevant Event pursuant to Section 5.01(r).
"Power Purchase Agreement" means any contract for the sale of
electric capacity and energy by a Borrower Group Member with a term in
excess of one year.
"PPA Documents" means all Power Purchase Agreements and, if
any such Power Purchase Agreement is not with an Acceptable PPA
Counterparty, all Acceptable Credit Support relating thereto.
"PPA Parameters" means, with respect to any electric
generation plant, any Power Purchase Agreement not previously provided
in the form necessary to satisfy Section 3.01(c)(ix)(D) of the Original
Credit Agreement:
(a) with a purchaser or off-taker which is an
Acceptable PPA Counterparty;
(b) which provides for capacity or fixed or other
payments to the Seller which are payable regardless of
availability (except to the extent caused by the Seller or by
force majeure) or actual dispatch of such plant, and which are
sufficient to achieve the Required Project DSCR applicable to
such plant (in each case, prorated if such Power Purchase
Agreement is not for the entire capacity of such plant);
(c) pursuant to which (i) if such plant has not yet
achieved Substantial Completion, upon Substantial Completion,
all conditions precedent for commencement of the obligations
of the purchaser or off-taker with respect to payment for
capacity, energy or ancillary services provided under such
Power Purchase Agreement (other than the passage of time) will
have been satisfied; (ii) if such plant has achieved
Substantial Completion, all conditions precedent for
commencement of the obligations of the purchaser or off-taker
with respect to payment for capacity, energy or ancillary
services provided under such Power Purchase Agreement (other
than the passage of time) have been satisfied; and (iii)
penalties or liquidated damages for delay in completion of
construction or completion of such plant at a reduced capacity
from that contracted for under such Power Purchase Agreement
(or equivalent sums), if any, are payable by the Seller at or
are only accrued as of or prior to Substantial Completion;
(d) pursuant to which the obligations of the Seller
(i) with respect to the date when, and the extent to which,
such plant is available for dispatch, is consistent with the
Scheduled Completion Date for such Project (or the equivalent
thereof, as applicable), as confirmed by the Independent
Engineer and Environmental Consultant, or may otherwise be met
with other resources available to the Seller; and (ii) which
relate to performance of such plant (with respect to output,
heat rate and availability) are consistent with the design of,
and technical and performance parameters applicable to, such
plant, as confirmed by the Independent Engineer and
Environmental Consultant, or may otherwise be met with other
resources available to the Seller;
(e) pursuant to which substantially all costs and
expenses payable by the Seller with respect to fuel (including
any transportation thereof) for the generation of capacity,
energy and/or ancillary services provided to the purchaser or
off-taker thereunder are (i) subject to a full "pass-through"
to, or may otherwise be recovered in full from, the purchaser
or off-taker; or (ii) recoverable from the purchaser or
off-taker, based on a fuel price index that matches with
reasonable closeness the projected fuel type and fuel costs of
such Project, to the extent that the heat rate of such plant
satisfies applicable heat rates agreed between the parties in
such Power Purchase Agreement;
(f) pursuant to which fixed and variable operations
and maintenance costs and expenses will be provided for either
in the capacity payment under such Power Purchase Agreement or
in a separate $/kW-year or $/MWh payment;
(g) which would not subject the Seller to market
damages to cover replacement costs incurred by the purchaser
or off-taker for any failure by the Seller to perform its
obligations under such Power Purchase Agreement, to the extent
such failure is due to planned or scheduled outages of such
plant or events of force majeure (whether expressly provided
or after taking into account the availability factor utilized
in such Power Purchase Agreement);
(h) which does not require the granting of any Lien
in connection therewith; and
(i) which is not assignable, except to another
Acceptable PPA Counterparty or unless such assignment does not
release the original Acceptable Counterparty from its
obligations.
"Project Advance" has the meaning specified in Section 2.16.
"Project Base Case Projections" means, with respect to any
Subsequent Project, projections prepared by the Independent Engineer
and Environmental Consultant (and approved by the Borrower) for such
Project in the same format as the Initial Base Case Projections and
reflecting the prices, costs and other relevant amounts set forth in
the certificates from the Independent Market Consultant and the
Independent Engineer and Environmental Consultant delivered in
connection with such Project pursuant to Section 3.04.
"Project Bonds" means industrial development revenue bonds
issued by any development authority created and existing under the laws
of the State of Georgia in connection with a Development Authority
Sale/Leaseback.
"Project Budget" means, for each Project, its Initial Project
Budget or, if an Adjusted Project Budget has been received by the Agent
for such Project pursuant to Section 2.01(b) or 5.01(r), the then most
recent Adjusted Project Budget.
"Project Costs" means, with respect to any Project, the cost
of the development, design, engineering, acquisition, installation,
equipping, construction, assembly, inspection, testing, completion, and
start-up of such Project, including (without duplication): (a) all
amounts payable under any construction contracts, any contractor
bonuses, site acquisition and preparation costs, any interconnection
and transmission upgrade costs payable by any Borrower Group Member,
all steam and water interconnection costs, all costs related to water
clarification facilities and/or water treatment facilities, all costs
of acquisition and construction of natural gas fuel handling and
processing equipment (if any) and interconnection expenses payable by
any Borrower Group Member and all other costs payable by any Borrower
Group Member under all Power Purchase Agreements and other contracts
relating to such Project; (b) all other costs, including fuel-related
costs and prepaid fuel costs, management services fees and expenses and
expenses to complete the development, acquisition, construction and
financing of such Project; and (c) interest on Advances made with
respect to, and commitment fees on the unused portion of the
Commitments available to, such Project; provided that in the case of
Projects that are not wholly owned or leased (pursuant to a Development
Authority Sale/Leaseback) by the Borrower or a wholly owned Subsidiary
(other than an Unrestricted Subsidiary) of the Borrower, Project Costs
shall consist of a pro rata portion (based on the Borrower's ownership
or leasehold interest percentage in such Project or direct or indirect
ownership percentage in the Person owning such Project, as the case may
be) of the amounts of costs described above.
"Project Debt" means, at any time with respect to any Project,
all Advances then outstanding and all Commercial Paper then outstanding
(and as to which a CP Commitment Reservation is then in effect), in
each case, with respect to such Project.
"Project DSCR" means, at any time with respect to any electric
generation plant, a pro forma ratio, for each of the twenty (20) years
(or part thereof) after the Scheduled Completion Date for such electric
generation plant (or equivalent thereof if such plant is not a
Project), of (a) all cash earnings from operations of such electric
generation plant, prior to interest, principal and any income tax
payments during such year (or part thereof, as the case may be), to (b)
all Debt service during such year (or part thereof, as the case may be)
with respect to Debt incurred with respect to such electric generation
plant (assuming such Debt is fully amortized during such twenty (20)
year period and a fixed interest rate of 8.25% per annum).
"Project Finance Debt" means Debt incurred or existing in
connection with the financing or refinancing of any Asset (other than a
Project or the Assets comprising a Project, or any portion thereof),
the repayment of which Debt is to be made from the revenues arising out
of, or other proceeds of realization from, the acquired or created
Asset or project, with recourse to those revenues and proceeds and
Assets forming the subject matter of such Asset or project (including
insurance, contracts and shares or other rights of ownership in the
entity(ies) which own the relevant Assets or project) and other Assets
ancillary thereto but without substantial recourse to any other Asset
(other than Assets of any Unrestricted Subsidiary) or otherwise to the
Borrower or any Relevant Subsidiary; provided that substantial recourse
shall not be deemed to exist by reason of normal and customary sponsor
support arrangements if (a) the Borrower's obligations under such
arrangements, together with all other such arrangements then in
existence, does not exceed the net cash available for Restricted
Payments by the Borrower pursuant to Section 5.02(b) in its two (2)
fiscal quarters immediately preceding the incurrence thereof; and (b)
the Borrower has an Investment Grade Rating which is reaffirmed by S&P
and Moody's immediately after the incurrence of such obligations.
"Project Limit" means, with respect to each Project, the
aggregate amount of all Utilizations related to such Project that is
permitted under this Agreement, which amount with respect to (a) each
Initial Project, is set forth in Schedule III; and (b) each Subsequent
Project, shall be calculated by the Borrower (and agreed to by the
Agent) based upon the Initial Project Budget and the Project Base Case
Projections for such Subsequent Project as the maximum principal amount
of Utilizations permitted with respect to such Project, such
determination to be consistent with the Required Project DSCR for such
Project (but which shall not, in any event, exceed the amount equal to
65% of the Project Costs, as set forth in the Initial Project Budget
for such Project), in each case, as amended pursuant to Section
2.01(b); provided that the "Project Limit" for (i) each Project which
is an Uncompleted Project on the date of the first Utilization with
respect to such Project shall, from and after the Non-Recourse Date for
such Project, be the aggregate principal amount of all Utilizations
outstanding as of the date of determination (including the
Utilizations, if any, made on the Non-Recourse Date or repaid or
reduced (in the case of a repayment of Commercial Paper and the
corresponding reduction in the outstanding CP Commitments, if any, made
with respect to such Commercial Paper) on or after the Non-Recourse
Date); and (ii) each Project which is a Completed Project on the date
of the first Utilization with respect to such Project shall, as of each
date after the date of such first Utilization, be the aggregate
principal amount of all Utilizations outstanding on the date of
determination (including the Utilizations, if any, made on such date or
repaid or reduced (in the case of a repayment of Commercial Paper and
the corresponding reduction in the outstanding CP Commitments, if any,
made with respect to such Commercial Paper) on such date).
"Project PPA Document" means any PPA Document that (a) has
been delivered by the Borrower to the Agent (i) pursuant to Section
3.01(c)(ix)(D) or 3.02(c) of the Original Credit Agreement or Section
3.04(c), 3.06(a) or 3.06(d) hereof with respect to a Project for so
long as such Project is owned by the Borrower or any of its
Subsidiaries (other than an Unrestricted Subsidiary), or (ii) along
with a Required Project DSCR Certificate in connection with the
calculation of (A) any Buydown Amount pursuant to Section 2.09(b)(i)(B)
and Section 2.09(b)(ii)(B), or (B) any amount required to be prepaid
pursuant to Section 2.09(b)(iii); or (b) (i) is in respect of a Plant
the construction or acquisition of which has been financed or
refinanced with Recourse Debt (other than for working capital or
general corporate borrowings), and (ii) is for a contract capacity of
at least 250 megawatts; provided, however that in no event shall
"Project PPA Document" include (x) that certain Purchased Power
Agreement between Georgia Power Company and Dynegy Power Marketing,
Inc., dated as of March 2, 2000, as assigned by Georgia Power Company
to the Borrower as of July 31, 2001, (y) that certain Energy Contract,
dated as of March 28, 2002, by and between the Borrower and Dynegy
Power Marketing, Inc., and (z) that certain Power and Gas Supply
Agreement, dated as of March 28, 2002, among the Borrower, Dynegy Power
Marketing, Inc. and Dynegy Marketing and Trade.
"Project Schedule" means, with respect to each Project, a
schedule for such Project which, with respect to each (a) Initial
Project, is set forth in Schedule IV; and (b) Subsequent Project, is
delivered by the Borrower to the Agent prior to the first Utilization
related to such Project pursuant to Section 3.04 or 3.06 (as the case
may be), setting forth such Project's Scheduled Completion Date (if
such Project has not yet achieved Final Completion) and the Guaranteed
Output and Guaranteed Heat Rate for such Project.
"Projects" means, collectively, the Initial Projects and the
Subsequent Projects; each individually, a "Project".
"PUHCA" means the Public Utility Holding Company Act of 1935,
as amended.
"Punch List Items" means, with respect to the construction of
any electric generation plant, those incomplete work items that do not
have a material effect on the operations and maintenance of such plant,
including painting, platforms, and damaged instrument glass.
"Rating Level" means, with respect to any date, any of the
following levels (with Level 1 being the "highest" of such Rating
Levels and Level 6 being the "lowest"), as determined by reference to
the Facility Ratings, if any, on such date issued by S&P and Moody's:
- --------------------------------- ---------------------------------------------
Facility Rating:
Rating Level S&P/Moody's
- --------------------------------- ---------------------------------------------
- --------------------------------- ---------------------------------------------
Level 1 A-/A3 or higher
- --------------------------------- ---------------------------------------------
- --------------------------------- ---------------------------------------------
Level 2 BBB+/Baa1
- --------------------------------- ---------------------------------------------
- --------------------------------- ---------------------------------------------
Level 3 BBB/Baa2
- --------------------------------- ---------------------------------------------
- --------------------------------- ---------------------------------------------
Level 4 BBB-/Baa3
- --------------------------------- ---------------------------------------------
- --------------------------------- ---------------------------------------------
Level 5 Lower than BBB-/Baa3 by either agency
- --------------------------------- ---------------------------------------------
- --------------------------------- ---------------------------------------------
Level 6 Unrated/Partially Rated
- --------------------------------- ---------------------------------------------
provided that (i) if on any day the Facility Ratings
established by S&P and Moody's fall within different Rating
Levels, the Rating Level for such day shall be determined by
reference to the lowest such Facility Rating; (ii) if any
Facility Rating established by S&P or Moody's shall be
changed, such change shall be effective as of the date on
which such change is notified in writing to the Borrower, or
is announced publicly, by the rating agency making such
change; and (iii) if S&P or Moody's shall change the basis on
which ratings are established, each reference to a Facility
Rating announced by S&P or Moody's, as the case may be, shall
refer to the then equivalent rating by S&P or Moody's, as the
case may be.
"Recourse Debt" means all Debt of the Borrower and each
Relevant Subsidiary (including subordinated debt) other than Affiliate
Subordinated Debt.
"Reference Banks" means Citibank, The Bank of Tokyo-Mitsubishi,
Ltd. and Commerzbank AG.
"Refinancing" means the incurrence of Debt by the Borrower or
any Subsidiary (other than pursuant to the issuance of Original
Commercial Paper or Rollover Commercial Paper) for purposes of
refinancing Project Costs for, or outstanding Utilizations made with
respect to, one or more Projects.
"Refinancing Commercial Paper" means Commercial Paper the
proceeds of which are used to refinance outstanding Project Advances or
CP Advances made with respect to the same Project, or Working Capital
Advances, or to repay Affiliate Subordinated Debt or pay a Restricted
Payment as permitted under Section 2.16(c) of this Agreement, as
applicable.
"Refinancing Date" means, with respect to any Project, the
date on which there are no outstanding Advances made with respect to
such Project and no Commitments available with respect to such Project.
"Register" has the meaning specified in Section 8.07(d).
"Relevant Completed Plants" means, when used to determine (a)
the Buydown Amount to be paid in connection with the occurrence of the
Buydown Date for any Substantially Completed Project, all Completed
Plants as of such Buydown Date for which the Borrower has delivered to
the Agent a Required Project DSCR Certificate (other than any other
Substantially Completed Project for which a Buydown Amount is also paid
or to be paid on such Buydown Date) and such Substantially Completed
Project; (b) the Buydown Amount to be paid with respect to any
Substantially Completed Project upon the occurrence of a Southern Event
of Default, all Completed Plants as of such Buydown Date for which the
Borrower has delivered to the Agent a Required Project DSCR Certificate
(other than any other Substantially Completed Project for which a
Buydown Amount is also paid or to be paid as a result of such Southern
Event of Default) and such Substantially Completed Project; and (c) the
amount, if any, to be prepaid pursuant to Section 2.09(b)(iii) on the
Sale Prepayment Date relating to any Sale, all Completed Plants as of
such Sale Prepayment Date.
"Relevant Event" means, as the context may require, a Buydown
Event, a Southern Event of Default or a Sale Event.
"Relevant Subsidiaries" means, collectively, all Subsidiaries
(other than Unrestricted Subsidiaries) of the Borrower; each
individually, a "Relevant Subsidiary".
"Remaining Base Case Period" means, as of any date, the period
from the first day of the fiscal quarter in which such day occurs up to
and including December 31, 2023.
"Reportable Event" means a "reportable event" as defined in
Section 403 of ERISA with respect to which the notice requirements to
the Pension Benefit Guaranty Corporation established under ERISA (or
any successor thereto) have not been waived.
"Representatives" has the meaning specified in Section 8.08.
"Required Lenders" means at any time Lenders owed at least 75%
of the then aggregate unpaid principal amount of the outstanding
Advances, or, if no such principal amount is then outstanding, Lenders
having at least 75% of the aggregate amount of the Commitments.
"Required Project DSCR" means, at any date with respect to any
electric generation plant, the following minimum Project DSCR for each
of the years (or part thereof) thereafter during the 20 years after the
Scheduled Completion Date of such plant (if it is a Project), or the
equivalent thereof (if such plant is not a Project), and the following
average Project DSCR for such period: (a) if such electric generation
plant is a Baseload, an average Project DSCR of 3.30:1.00 and a minimum
Project DSCR of 2.50:1.00; (b) if such electric generation plant is an
Intermediate (High), an average Project DSCR of 3.60:1.00 and a minimum
Project DSCR of 2.80:1.00; (c) if such electric generation plant is an
Intermediate (Low), an average Project DSCR of 4.30:1.00 and a minimum
Project DSCR of 3.70:1:00; and (d) if such electric generation plant is
a Peaker, an average Project DSCR of 5.00:1.00 and a minimum Project
DSCR of 4.50:1.00; provided that (i) an average and a minimum Project
DSCR of 1.60:1.00 shall be applicable during the term of any Power
Purchase Agreement entered into with respect to the entire capacity of
such electric generation plant which is owned by the Borrower or any
Relevant Subsidiary, if the Agent has received a Required Project DSCR
Certificate, dated as of such date, with respect to such electric
generation plant; and (ii) if the entire capacity of such electric
generation plant which is owned by the Borrower or any Relevant
Subsidiary is not contracted for under all such Power Purchase
Agreements, the average and minimum Project DSCRs applicable to such
electric generation plant shall be determined by reference to the
weighted average of 1.60:1.00 and the minimum and average Project DSCR
(as the case may be) applicable to such electric generation plant if
there were no such Power Purchase Agreement, with such weighted average
determined based upon the portion of the capacity of such electric
generation plant which is the subject of such Power Purchase
Agreement(s) at any relevant time.
"Required Project DSCR Certificate" means a certificate of the
Borrower certifying, with respect to each Power Purchase Agreement and
related Acceptable Credit Support, if any, entered into with respect to
(a) any Project, and which PPA Documents were previously delivered to
the Agent in satisfaction of Section 3.01(c)(ix)(D) or 3.02(c)(ii) of
the Original Credit Agreement or Section 3.04(c) or 3.06(a) or (d)
hereof, that each such PPA Document remains in full force and effect,
all necessary approvals under all Federal and State Energy Laws and
Regulations required to be obtained with respect thereto under Section
3.02 of the Original Credit Agreement or Section 3.04 or 3.06 hereof
(as applicable) remain in full force and effect, and there is no
litigation, arbitration or administrative proceeding currently pending
against any Borrower Group Member concerning (i) the pricing terms
under such Power Purchase Agreement; or (ii) any such PPA Document
which has had or would reasonably be expected to have a Material
Adverse Effect; and (b) any other Plant which is not a Project, and
which PPA Documents are delivered to the Agent together with such
certificate, that (i) such Power Purchase Agreement complies with all
of the PPA Parameters and does not contain any additional terms not set
forth in the PPA Parameters which impose additional material
obligations outside the ordinary course of business of the industry
generally on, or otherwise materially reduce the benefit to, any
Borrower Group Member thereunder or that such Power Purchase Agreement
is one of the EMC Contracts; (ii) such PPA Documents are in full force
and effect; (iii) all necessary approvals required to be obtained with
respect to such PPA Documents under all Federal and State Energy Laws
and Regulations have been obtained, are in full force and effect and
are final and non-appealable but for any Filing Conditions, and do not
contain any restrictions, conditions or requirements which are then
required to be satisfied and have not been satisfied, other than any
Filing Conditions; and (iv) if such Power Purchase Agreement is an EMC
Contract, (A) to the best of the Borrower's knowledge, (w) no "MAC" (as
defined in such EMC Contract as in effect on the date of this
Agreement) has occurred to the applicable EMC Counterparty since the
date of this Agreement, (x) no event of the type specified in Section
6.01(f) hereof has occurred with respect to such EMC Counterparty since
the date of this Agreement, (y) no material adverse change in the
membership profile of such EMC Counterparty has occurred since the date
of this Agreement, and (z) the fuel pass-through mechanism included in
such EMC Contract provides a reasonable method for the Borrower to
recover fuel related costs under such EMC Contract, and (B) the
projections for the incremental requirement needs of the applicable EMC
Counterparty have been confirmed by the Independent Market Consultant
to be reasonable.
"Restricted Payments" means, with respect to any Person, any
dividend payment or other distribution of assets, properties, cash,
rights, obligations or securities on account of any class of capital
stock of such Person.
"Rollover Commercial Paper" means any Commercial Paper which
is issued in the amount of, and for the repayment of, existing
Commercial Paper on the maturity thereof or Affiliate Subordinated Debt
issued to repay Commercial Paper issued for the Borrower's general
corporate purposes or to provide working capital for the Borrower, as
applicable, and for which CP Commitments are then outstanding under the
Facility.
"S&P" means Standard & Poor's Ratings Services, a division of
The McGraw-Hill Companies, Inc.
"Sale" means the sale (including by way of sale/leaseback
other than a Development Authority Sale/Leaseback), in whole or in
part, of any Asset of the Borrower or any of its Relevant Subsidiaries
or the ownership interest in any direct or indirect Relevant Subsidiary
to a Person which is not a Borrower Group Member.
"Sale Event" means, with respect to any Sale, the earlier to
occur of (a) the date which is six (6) months after receipt of all or
any part of the Sale Proceeds arising from such Sale; and (b) issuance
of a prepayment notice from the Borrower with respect to the Sale
Proceeds from such Sale.
"Sale Prepayment Date" has the meaning specified in Section
2.09(b)(iii).
"Sale Proceeds" means, with respect to any Sale, the proceeds
arising from such Sale, net of customary transaction costs and
expenses, other than (a) Exempt Asset Sale Proceeds; and (b) proceeds
which are applied to repay all Recourse Debt of the Borrower and its
Relevant Subsidiaries, other than Debt under the Facility, incurred in
connection with the acquisition, improvement, development, ownership or
operation of such Asset.
"Scheduled Completion Date" means, with respect to each
Project, the date on which its Final Completion is expected to occur,
as set forth in the Project Schedule for such Project.
"Seller" means, with respect to any electric generation plant,
the Borrower or any Relevant Subsidiary which owns or leases such
plant, as the case may be.
"Similar Asset" means any gas-fired electric generation plant
(other than an Initial Project or a Subsequent Project) in, or to be
constructed in, the United States, which is, or is to be, owned wholly
or partially (as tenants-in-common) or leased (pursuant to a
Development Authority Sale/Leaseback) by the Borrower or by any
Relevant Subsidiary which is wholly or majority owned by, and is
controlled by, the Borrower, including all buildings, structures and
improvements, and easements with respect thereto, all alterations
thereto or replacements thereof, all fixtures, attachments, appliances,
equipment, machinery and other articles attached thereto or used in
connection therewith and all parts which may from time to time be
incorporated or installed in or attached thereto, all contracts and
agreements for the purchase or sale of commodities or other personal
property related thereto, all leases of personal property related
thereto, and all other real and tangible and intangible personal
property related thereto.
"Southern" means The Southern Company, a Delaware corporation.
--------
"Southern Completion Guarantee" means the Completion
Guarantee, dated as of November 15, 2001, as amended by that certain
Letter Amendment No. 1 to Completion Guarantee, dated as of the date
hereof, among the Borrower, the Agent and Southern in the form or
substantially in the form of Exhibit H.
"Southern Equity Agreement" means the Equity Contribution
Agreement, dated as of November 15, 2001, as amended by that certain
Letter Amendment No. 1 to Equity Contribution Agreement, dated as of
the date hereof, among the Borrower, the Agent and Southern in the form
or substantially in the form of Exhibit G.
"Southern Event" means any Southern Event of Default or any
event, occurrence or circumstance which with the passage of time and/or
giving of any notice would become a Southern Event of Default.
"Southern Event of Default" has the meaning specified for the
terms "Guarantor Event of Default" and "Southern Event of Default" in
Section 5 of the Southern Completion Guarantee and Section 2(i) of the
Southern Equity Agreement, respectively.
"SPV" has the meaning specified in Section 8.07(j).
"Stub Period" means, with respect to any Project and any Power
Purchase Agreement relating to such Project, the period from the
Scheduled Completion Date for such Project up to and including the date
when all obligations of the purchaser or off-taker under such Power
Purchase Agreement commences.
"Subsequent Projects" means, collectively, (a) gas-fired
electric generation plants (other than the Initial Projects) in, or to
be constructed in, the United States, which are or are to be wholly or
partially financed by the Facility, owned wholly or partially (as
tenants-in-common) or leased (pursuant to a Development Authority
Sale/Leaseback) by the Borrower or by any Relevant Subsidiary which is
wholly or majority owned by, and is controlled by, the Borrower,
including all buildings, structures and improvements, and easements
with respect thereto, all alterations thereto or replacements thereof,
all fixtures, attachments, appliances, equipment, machinery and other
articles attached thereto or used in connection therewith and all parts
which may from time to time be incorporated or installed in or attached
thereto, all contracts and agreements for the purchase or sale of
commodities or other personal property related thereto, all leases of
personal property related thereto, and all other real and tangible and
intangible personal property related thereto; and (b) each Similar
Asset acquired in accordance with Section 5.01(l)(iii) or pursuant to a
reinvestment of Sale Proceeds made in accordance with Section 5.01(m);
each individually, a "Subsequent Project".
"Subsidiary" means, as to any Person, a corporation,
partnership, limited liability company or other entity of which (or in
which) shares of stock or other ownership interests having ordinary
voting power (other than stock or such other ownership interests having
such power only by reason of the happening of a contingency) to elect a
majority of the board of directors or other managers of such
corporation, partnership or other entity are at the time owned, or the
management of which is otherwise controlled, directly or indirectly,
through one or more intermediaries, or both, by such Person.
"Substantial Completion" means the date on which Southern
certifies in the form of Exhibit L-1 to the Agent that, in the case of
(a) any Project, (i) such Project has achieved Mechanical Completion;
(ii) such Project has passed an emissions test demonstrating that it
can operate in accordance with its permits; (iii) such Project has
achieved at least 95% of its Guaranteed Output and has achieved a heat
rate not greater than 105% of its Guaranteed Heat Rate, in each case,
as set forth in the Project Schedule for such Project and as tested in
accordance with the testing procedures applicable to such Project set
forth in, or determined pursuant to, Schedule V; (iv) such Project has
successfully completed the reliability run applicable thereto, as set
forth in, or determined pursuant to, Schedule V; (v) such Project has
obtained final, non-appealable permits required to operate as designed
as of such date; and (vi) all necessary facilities for the
transportation of natural gas to, the necessary electric interconnect
facilities for, and all necessary facilities for the procurement,
transportation and discharge of water to and from, such Project have
been completed; and (b) any other electric generation plant owned or
leased by the Borrower or any Relevant Subsidiary, the equivalent
thereof has occurred.
"Substantially Completed Projects" means, as at any date, all
Projects which have achieved Substantial Completion but not Final
Completion as of such date; each individually, a "Substantially
Completed Project".
"Synthetic Lease" means a financing for any Asset which is
characterized as an operating lease under GAAP, but which is treated as
a financing under the Code.
"Taxes" has the meaning specified in Section 2.13(a).
"Total Capitalization" means the sum of (a) the aggregate of
the capital stock and other equity accounts (including retained
earnings and paid-in capital) of the Borrower; (b) to the extent not
included under clause (a) or (d), the aggregate amount of any funded
Equity Contributions; (c) Recourse Debt; and (d) Affiliate Subordinated
Debt; provided that "Total Capitalization" shall not include (i) the
obligations of any Borrower Group Member with respect to any Trust
Preferred Securities; and (ii) any capital stock or other equity
(including paid-in capital and retained earnings, other than retained
earnings which are permitted to be distributed by an Unrestricted
Subsidiary to a Borrower Group Member) attributable, directly or
indirectly, to an Unrestricted Subsidiary.
"Total Operating Cash Flow" means the projection done at the
end of each fiscal quarter of the next four fiscal quarters of the
Borrower's and the Borrower's Subsidiaries' (other than Unrestricted
Subsidiaries) total cash flow available for debt service, as projected
consistent with the Borrower's financial reporting procedures.
"Total Project Costs" means, with respect to each Completed
Project, the Project Costs incurred with respect to such Project as of
the Non-Recourse Date for such Project (including all Project Costs
incurred on such date).
"Trust Preferred Securities" means deferrable interest debt
securities, and any related securities issued by a trust or other
special purpose entity in connection therewith, as long as (a) the
maturity date of all such Debt is subsequent to the Final Maturity Date
and there is no amortization of such Debt prior to the Final Maturity
Date; (b) the obligations with respect thereto are not secured by any
Liens (other than Liens on such debt securities and any proceeds
thereof); and (c) the Borrower's obligations under the Facility are
senior in right of payment in full in cash to such Debt, and such Debt
is expressly made fully subordinated in right of payment in full in
cash to all obligations of the Borrower with respect to the Facility.
"Type" has the meaning specified in the definition of
"Advance".
"Uncompleted Plants" means all Plants which are not Completed
Plants; each individually, an "Uncompleted Plant".
"Uncompleted Project Advances" means, at any time, all
Advances then outstanding with respect to Uncompleted Projects; each
individually, an "Uncompleted Project Advance".
"Uncompleted Projects" means all Projects which are not
Completed Projects; each individually, an "Uncompleted Project".
"United States" means the United States of America.
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"Unrated/Partially Rated" means the Debt under the Facility is
not rated by each of S&P and Moody's.
"Unrestricted Subsidiary" means any Subsidiary of the Borrower
(other than any Subsidiary of the Borrower which directly or indirectly
owns a Project or any portion thereof) all the Debt of which (a) is
nonrecourse to the Borrower or any of the Borrower's other Subsidiaries
(other than any other Unrestricted Subsidiary), other than with respect
to stock or other ownership interest of the Borrower or any of its
other Subsidiaries in such Subsidiary or to the extent permitted with
respect to Project Finance Debt; and (b) is not secured by any Assets
of the Borrower or any of its Subsidiaries (other than the Assets of,
or stock or other ownership interests in, an Unrestricted Subsidiary).
"Unused" means, with respect to each Lender's Commitment, the
amount which is equal to such Lender's Commitment minus all outstanding
Advances made by such Lender.
"Updated Base Case Projections" means, as of any date, the
Initial Base Case Projections, as supplemented by all Project Base Case
Projections previously delivered pursuant to Section 3.04, in each
case, for a period from such date up to and including December 31,
2023.
"U.S. Tax Law Change" has the meaning specified in Section
2.13(a).
"Utilizations" means a Borrowing or a CP Commitment
Reservation, as the context may require; each individually, a
"Utilization".
"Wansley Project" means the approximately 1,134MW gas-fired
electric generation plant constructed or to be constructed by the
Borrower or an Affiliate of the Borrower in Heard County, Georgia.
"Wansley Sale/Leaseback" means the sale/leaseback of the
Wansley Project, pursuant to the Lease Agreement dated as of December
1, 2000 between the Development Authority of Heard County (a public
body corporate and politic created and existing under the laws of the
State of Georgia), as lessor, and the Borrower (as assignee of Georgia
Power Company), as lessee (as amended, modified and supplemented from
time to time to extend such lease to additional real or personal
property comprising the Wansley Project), and all documents relating
thereto.
"Working Capital Advance" has the meaning specified in Section
2.16.
SECTION 1.02. Computation of Time Periods. In this Agreement in the computation
of periods of time from a specified date to a later specified date, the word
"from" means "from and including" and the words "to" and "until" each mean "to
but excluding".
SECTION 1.03. Accounting Terms. All accounting terms not specifically defined
herein shall be construed in accordance with GAAP.
SECTION 1.04. Interpretation. In this Agreement:
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(a) the singular includes the plural and the plural includes the singular;
(b) the word "or" is not exclusive;
(c) the words "include", "includes" and "including" are not limiting;
(d) a reference to an Article, Section, Schedule or Exhibit is to the
Article, Section, Schedule or Exhibit of this Agreement unless
otherwise indicated, and Schedules and Exhibits to this Agreement shall
be deemed incorporated by reference in this Agreement;
(e) references to any document, instrument or agreement shall include (i)
all schedules, exhibits and other attachments thereto; and (ii) all
documents, instruments or agreements issued or executed in replacement
thereof;
(f) references to any document or agreement, including this Agreement,
shall be deemed to include references to such document or agreement as
amended, supplemented, modified or restated and in effect from time to
time in accordance with its terms and subject to the conditions set
forth herein and therein;
(g) references to "days" shall mean calendar days, unless the term
"Business Days" shall be used; and
(h) the Loan Documents are the result of negotiations among the Loan
Parties, the Agent, each Initial Lender and their respective counsel.
Accordingly, the Loan Documents shall be deemed the product of all
parties thereto, and no ambiguity shall be construed in favor of or
against the Loan Parties, the Agent or any Lender.
Article II
AMOUNTS AND TERMS OF THE ADVANCES
SECTION 2.01. The Advances. (a) The Advances. Each Lender severally agrees, on
the terms and conditions set forth in this Agreement, to make Advances to the
Borrower from time to time on any Business Day during the period from the Funds
Availability Date to the Final Maturity Date in an aggregate amount not to
exceed at any time outstanding the amount set forth opposite such Lender's name
on Schedule I or, if such Lender has entered into any Assignment and Acceptance,
set forth for such Lender in the Register maintained by the Agent pursuant to
Section 8.07(d), as such amount may be reduced pursuant to Section 2.04 (such
Lender's "Commitment"); provided that (i) only one Borrowing of Project Advances
shall be permitted with respect to each of the Dahlberg Project and any
Subsequent Project which, as of the date of acquisition thereof by a Borrower
Group Member, is a Completed Project; (ii) Project Advances for any Project
shall be made in an aggregate amount not to exceed the Project Limit for such
Project (as reduced, in accordance with Section 2.15, to reflect the aggregate
amount of all outstanding CP Commitment Reservations, if any, relating to such
Project); (iii) CP Advances for any purpose shall be made in an aggregate amount
not to exceed the aggregate of all CP Commitment Reservations for such purpose;
(iv) Working Capital Advances shall be made in an aggregate amount not to exceed
the lesser of (A) the Borrowing Limit for Working Capital Advances (as reduced,
in accordance with Section 2.15, to reflect the aggregate amount of all
outstanding CP Commitment Reservations, if any, relating to Commercial Paper
issued by the Borrower for the Borrower's general corporate purposes or to
provide working capital for the Borrower); and (B) the aggregate of all Unused
Commitments minus all CP Commitment Reservations; and (v) the aggregate
principal amount of all outstanding Advances and CP Commitment Reservations
shall not exceed $650,000,000. Each Borrowing shall be in an aggregate amount of
$5,000,000 and an integral multiple of $1,000,000 in excess thereof, except for
any Borrowing of the remaining Unused portion of the Commitments available for
the making of Advances within the applicable Borrowing Limit. Each Borrowing
shall consist of Advances of the same Type and Category made on the same day by
the Lenders ratably according to their respective Commitments. The Borrower may
make more than one Borrowing on the same day; provided that (x) such Borrowings
are of different Categories; and (y) no more than two Borrowings of each
Category may be made during any one calendar month. Within each Lender's
Commitment, the applicable Borrowing Limit and the Availability Period, and
subject to the conditions set forth in Article III, the Borrower may borrow
under this Section 2.01, prepay pursuant to Section 2.09 and reborrow under this
Section 2.01.
(b) Project Limit Modification. The Borrower shall have the right, upon at
least thirty (30) days' notice to the Agent, to modify the Project
Limit applicable to any Uncompleted Project; provided that:
(i) the aggregate principal amount of all outstanding Advances and CP
Commitment Reservations shall not exceed $650,000,000;
(ii) the aggregate of all increases in the Project Limit for any Project may
not exceed 10% of the Initial Project Limit for such Project;
(iii) other than with respect to any modification reducing such Project Limit
to zero, the Agent shall have received an Adjusted Project Budget for
such Project; and
(iv) the aggregate principal amount of all outstanding Advances and CP
Commitment Reservations with respect to such Project shall not exceed
the Project Limit, upon such modification, for such Project.
(c) Designated Lenders. For any Lender which is a Designating Lender, any
Advance to be made by such Lender may from time to time be made by its
Designated Lender in such Designated Lender's sole discretion, and
nothing herein shall constitute a commitment to make Advances by such
Designated Lender; provided that if any Designated Lender elects not
to, or fails to, make any such Advance, its Designating Lender hereby
agrees that it shall make such Advance pursuant to the terms of this
Agreement. Any Advance actually funded by a Designated Lender shall
constitute a utilization of the Commitment and, in the case of a CP
Advance, the CP Commitment of the Designating Lender for all purposes
under this Agreement.
SECTION 2.02. Making the Advances. (a) Each Borrowing shall be made on notice,
given not later than 11:00 A.M. (New York City time) on the third Business Day
prior to the date of the proposed Borrowing in the case of a Borrowing
consisting of Eurodollar Rate Advances, or not later than 11:00 A.M. (New York
City time) on the date of the proposed Borrowing in the case of a Borrowing
consisting of Base Rate Advances, by the Borrower to the Agent, which shall give
to each Lender prompt notice thereof by telecopier. Each such notice of a
Borrowing (a "Notice of Utilization") shall be by telephone, confirmed
immediately by telecopier in substantially the form of Exhibit B, (i) specifying
therein the requested (A) date of such Borrowing; (B) Type and Category of
Advances comprising such Borrowing; (C) aggregate amount of such Borrowing; (D)
in the case of a Borrowing comprising Project Advances or CP Advances, aggregate
principal amount of the Advances to be made with respect to each Project; and
(E) in the case of a Borrowing consisting of Eurodollar Rate Advances, initial
Interest Period for each such Advance; (ii) in the case of a Borrowing
comprising of Project Advances, specifying therein the relevant Project(s) and
containing a representation that proceeds of the requested Borrowing will be
used to finance Project Costs for such Project(s) (including, in the case of any
Project, repayment of any Affiliate Subordinated Debt incurred by the Borrower
(A) to fund the costs of acquiring such Project prior to the initial Advances
hereunder in respect of such Project or (B) to pay Project Costs in respect of
such Project at any time prior to the Non-Recourse Date for such Project);(iii)
in the case of a Borrowing comprising CP Advances, specifying the relevant
Project(s), if any, and CP Commitment Reservation(s) pursuant to which such CP
Advances are requested; (iv) containing a representation that such Borrowing
will not result in the applicable Borrowing Limit to be exceeded or the
aggregate principal amount of all outstanding Advances and CP Commitment
Reservations to exceed $650,000,000; and (v) specifying the aggregate principal
amount of all outstanding Advances and the unused Commitments and CP
Commitments, in each case, after giving effect to the proposed Borrowing. Each
Lender shall, before 11:00 A.M. (New York City time) on the date of such
Borrowing, make available for the account of its Applicable Lending Office to
the Agent at the Agent's Account, in same day funds, such Lender's ratable
portion of such Borrowing; provided that if a Notice of Utilization in respect
of a proposed Borrowing consisting of Base Rate Advances is given on the date of
such Borrowing, the Lenders shall so make available their ratable portions of
such Borrowing before 3:00 P.M. (New York City time) on such date. After the
Agent's receipt of such funds and upon fulfillment of the applicable conditions
set forth in Article III, the Agent will make such funds available to the
Borrower at the Agent's address referred to in Section 8.02.
(b) Anything in subsection (a) above to the contrary notwithstanding, the
Borrower may not select Eurodollar Rate Advances for any Borrowing if the
obligation of the Lenders to make Eurodollar Rate Advances shall then be
suspended pursuant to Section 2.07(e) or 2.11.
(c) The Borrower shall indemnify each Lender against any actual and documented
loss (excluding any loss of profit and/or margin), cost or expense reasonably
incurred by such Lender as a result of (i) the revocation by the Borrower of (A)
any Notice of Utilization for a Borrowing that such Notice of Utilization
specifies is to be comprised of Eurodollar Rate Advances; or (B) any notice
given by the Borrower pursuant to Section 2.08 of the Conversion of Base Rate
Advances to Eurodollar Rate Advances; and (ii) any failure to fulfill on or
before the date specified in a Notice of Utilization for a Borrowing the
applicable conditions set forth in Article III, including, in each such case,
any loss (excluding loss of profit and/or margin), cost or expense reasonably
incurred by reason of the liquidation or reemployment of deposits or other funds
acquired by such Lender to fund the Advance to be made by such Lender as part of
such Borrowing or as a result of such Conversion when such Advance, as a result
of such revocation or failure, is not made on the date specified therefor in the
relevant Notice of Utilization or when such Base Rate Advances, as a result of
such revocation, are not converted to Eurodollar Rate Advances, but excluding,
however, any such losses, costs and expenses resulting from any such revocation
or failure which has occurred more than ninety (90) days prior to demand being
made to the Borrower by such Lender for indemnification. The payment of such
indemnity to a Lender shall be made within thirty (30) days of a demand by such
Lender complying with Section 8.04(d).
(d) With respect to any Borrowing, unless the Agent shall have received notice
from a Lender prior to the date of such Borrowing (in the case of a proposed
Borrowing consisting of Eurodollar Rate Advances) or on or before 1:00 P.M. (New
York City time) on the date of such Borrowing (in the case of a Borrowing
consisting of Base Rate Advances) that such Lender will not make available to
the Agent such Lender's ratable portion of such Borrowing, the Agent may assume
that such Lender has made such portion available to the Agent on the date of
such Borrowing in accordance with Section 2.02(a) and the Agent may, in reliance
upon such assumption, make available to the Borrower on such date a
corresponding amount. If and to the extent that such Lender shall not have so
made such ratable portion available to the Agent, such Lender and the Borrower
severally agree to repay to the Agent forthwith on demand such corresponding
amount together with interest thereon, for each day from the date such amount is
made available to the Borrower until the date such amount is repaid to the
Agent, at (i) in the case of the Borrower, the interest rate applicable at the
time to Advances comprising such Borrowing; and (ii) in the case of such Lender,
the Federal Funds Effective Rate. If such Lender shall repay to the Agent such
corresponding amount, such amount so repaid shall constitute such Lender's
Advance as part of such Borrowing for purposes of this Agreement.
(e) The failure of any Lender to make the Advance to be made by it as part of
any Borrowing shall not relieve any other Lender of its obligation, if any,
under this Agreement to make its Advance on the date of such Borrowing, but no
Lender shall be responsible for the failure of any other Lender to make the
Advance to be made by such other Lender on the date of any Borrowing.
SECTION 2.03. Fees. (a) Commitment Fee. The Borrower shall pay to the Agent for
the account of each Lender a commitment fee on the daily Unused portion of such
Lender's Commitment, (i) in the case of each Initial Lender, from the date of
this Agreement; and (ii) in the case of each other Lender (other than a
Designated Lender), from the effective date specified in the Assignment and
Acceptance pursuant to which it became a Lender, in each case, until the
Commitment Termination Date at a rate per annum equal to the Applicable
Commitment Fee Percentage in effect from time to time, payable in arrears on the
fifteenth day of each March, June, September and December, and on the Commitment
Termination Date.
(b) Agent's Fees. The Borrower shall pay to the Agent for its own account such
fees as may from time to time be agreed between the Borrower and the Agent.
SECTION 2.04. Termination or Reduction of the Commitments. The Borrower shall
have the right, upon at least three (3) Business Days' notice to the Agent, to
terminate in whole or reduce ratably in part the unused portions of the
respective Commitments of the Lenders; provided that (a) each partial reduction
shall be in the aggregate amount of $10,000,000 or an integral multiple of
$1,000,000 in excess thereof; and (b) the aggregate of all Commitments, upon
such reduction, shall not be less than the aggregate principal amount of all
Utilizations then outstanding.
SECTION 2.05. Repayment of the Advances. The Borrower shall repay to the Agent
for the ratable account of the Lenders on the Final Maturity Date the aggregate
principal amount of the Advances then outstanding.
SECTION 2.06. Interest on the Advances. (a) Scheduled Interest. The Borrower
shall pay interest on the unpaid principal amount of each Advance owing to each
Lender from the date of such Advance until such principal amount shall be paid
in full, at the following rates per annum:
(i) Base Rate Advances. During such periods as such Advance is a Base Rate
Advance, a rate per annum equal at all times to the sum of (A) the Base
Rate in effect from time to time plus (B) the Applicable Margin in
effect from time to time, payable in arrears on the fifteenth day of
each March, June, September and December during such periods and on the
date such Base Rate Advance shall be Converted or paid in full.
(ii) Eurodollar Rate Advances. During such periods as such Advance is a
Eurodollar Rate Advance, a rate per annum equal at all times during
each Interest Period for such Advance to the sum of (A) the Eurodollar
Rate for such Interest Period for such Advance plus (B) the Applicable
Margin in effect from time to time, payable in arrears on the last day
of such Interest Period and, if such Interest Period has a duration of
more than three (3) months, on each day that occurs during such
Interest Period every three months from the first day of such Interest
Period and on the date such Eurodollar Rate Advance shall be Converted
or paid in full.
(b) Default Interest. Upon the occurrence and during the continuance of an
Event of Default under Section 6.01(a) or any failure to prepay or
repay any Project Debt in accordance with Section 2.09(b), the Borrower
shall pay interest on (i) the unpaid principal amount of each Advance
owing to each Lender (in the case of such an Event of Default or any
failure to prepay or repay Project Debt in accordance with any of
Section 2.09(b)(ii), (iii), (iv) or (v)) or each Advance so required to
be prepaid pursuant to Section 2.09(b)(i), as the case may be, in each
case, payable in arrears on the dates referred to in Section 2.06(a)(i)
or (a)(ii) above and on demand, at a rate per annum equal at all times
to 2% per annum above the rate per annum required to be paid on such
Advance pursuant to Section 2.06(a)(i) or (a)(ii) above; and (ii) to
the fullest extent permitted by Law, the amount of any interest, fee or
other amount payable under this Agreement or under any Note that is not
paid when due, from the date such amount shall be due until such amount
shall be paid in full, payable in arrears on the date such amount shall
be paid in full and on demand, at a rate per annum equal at all times
to 2% per annum above the rate per annum required to be paid on Base
Rate Advances pursuant to Section 2.06(a)(i) above.
SECTION 2.07. Interest Rate Determination. (a) Each Reference Bank agrees to
furnish to the Agent, at its request, timely information for the purpose of
determining each Eurodollar Rate. If any one or more of the Reference Banks
shall not furnish such timely information to the Agent for the purpose of
determining any such interest rate, the Agent shall determine such interest rate
on the basis of timely information furnished by the remaining Reference Banks.
The Agent shall give prompt notice to the Borrower and the Lenders of the
applicable interest rate determined by the Agent for purposes of Section
2.06(a)(i) or (ii), and the rate, if any, furnished by each Reference Bank for
the purpose of determining the interest rate under Section 2.06(a)(ii).
(b) If (i) the Agent is unable for any reason to determine the Eurodollar
Rate for any Interest Period; (ii) if applicable, fewer than two
Reference Banks furnish timely information to the Agent for determining
the Eurodollar Rate for any Interest Period pursuant to Section
2.07(a); or (iii) the Majority Lenders notify the Agent by 12:00 noon
(London time) two Business Days prior to the first day of any Interest
Period that the Majority Lenders were unable to obtain, at
approximately 11:00 A.M. (London time) on such Business Day and at the
applicable Eurodollar Rate, Dollar deposits for a period equal to such
Interest Period and in amounts substantially equal to such Majority
Lenders' respective Eurodollar Rate Advances comprising part of the
Borrowing to be outstanding during such Interest Period, the Agent
shall promptly notify the Borrower and the Lenders of such event,
whereupon:
(A) within five (5) Business Days of receipt of such notification, the
Agent and the Borrower shall enter into good faith negotiations for a
period of fifteen (15) days (or such shorter period as is required to
agree to the alternative basis referred to in this clause (A)) with a
view to agreeing on an alternative basis for determining the rate of
interest applicable to such Eurodollar Rate Advances;
(B) any alternative basis agreed under clause (A) above with the approval
of the Majority Lenders and any interest rate determined pursuant
thereto will be binding on all the parties to this Agreement and will
be retroactive to, and take effect from, the first day of the
applicable Interest Period;
(C) if no alternative basis is agreed under clause (A) above within the 15-day
period there specified, the Agent, upon instructions of the Majority
Lenders, shall, on behalf of each of the Lenders, set forth an alternative
basis for determining the rate of interest applicable to such Eurodollar
Rate Advances on or before the last day of the Interest Period to which the
notification relates or, if earlier, within ten (10) days after the
expiration of the 15-day period set forth in clause (A) above. Each Lender
shall certify to the Agent and to the Borrower such Lender's actual cost of
funds for funding its applicable Eurodollar Rate Advances, and the Majority
Lenders shall certify to the Agent and the Borrower in reasonable detail
the alternative basis for determining the rate of interest to be applicable
to such Eurodollar Rate Advances and such interest rate as so determined;
(D) any interest rate determined pursuant to clause (C) above shall not, in
any event, exceed (1) the Majority Lenders' reasonable determination of
the cost to the Lenders, as certified by them pursuant to clause (C)
above, of funding their applicable Eurodollar Rate Advances plus (2)
the Applicable Margin;
(E) each alternative basis so certified by the Majority Lenders pursuant to
clause (C) above and each interest rate determined pursuant thereto
shall be binding on the Borrower and the Lenders and shall be
retroactive to, and take effect from, the first day of the applicable
Interest Period; and
(F) so long as any alternative basis referred to above is in force, the
Agent, in consultation with the Borrower and the Majority Lenders,
shall from time to time, but not less frequently than monthly, review
whether or not the circumstances referred to in this Section 2.07(b)
still prevail with a view to returning to the normal provisions of this
Agreement in relation to the method of determining interest as soon as
practicably possible.
(c) If the Borrower shall fail to select the duration of any Interest
Period for any Eurodollar Rate Advances in accordance with the
provisions contained in the definition of "Interest Period" in Section
1.01, then on the last day of the then existing Interest Period
therefor, if the Borrower could have selected an Interest Period for
such Eurodollar Rate Advances in accordance with such provisions, an
Interest Period with a duration of three (3) months shall be applicable
to such Eurodollar Rate Advances or, if the Borrower could not have
selected any Interest Period for such Eurodollar Rate Advances in
accordance with such provisions, such Eurodollar Rate Advances will
automatically, on such last day, Convert into Base Rate Advances, and
the Agent shall promptly notify the Borrower and the Lenders thereof.
(d) On the date on which the aggregate unpaid principal amount of
Eurodollar Rate Advances comprising any Borrowing shall be reduced, by
payment or prepayment or otherwise, to less than $10,000,000, such
Advances shall automatically Convert into Base Rate Advances.
(e) Upon the occurrence and during the continuance of (i) any Event of
Default, (A) each Eurodollar Rate Advance then outstanding will
automatically, on the last day of the then existing Interest Period
therefor, Convert into a Base Rate Advance; and (B) the obligation of
the Lenders to make, or to Convert Base Rate Advances into, Eurodollar
Rate Advances shall be suspended until all Events of Default have been
cured or waived; and (ii) any failure to prepay any Eurodollar Rate
Advance in accordance with Section 2.09(b)(i), (A) each Eurodollar Rate
Advance required to be so prepaid will automatically, on the last day
of the then existing Interest Period therefor, Convert into a Base Rate
Advance; and (B) the Lenders shall have no obligation to Convert any
Base Rate Advances required to be prepaid pursuant to Section
2.09(b)(i) into Eurodollar Rate Advances.
SECTION 2.08. Optional Conversion of the Advances. The Borrower may on any
Business Day, upon notice given to the Agent not later than 11:00 A.M. (New York
City time) on the third Business Day prior to the date of the proposed
Conversion and subject to the provisions of Sections 2.07 and 2.11, Convert all
Advances of one Type comprising the same Borrowing into Advances of the other
Type; provided that any Conversion of Eurodollar Rate Advances into Base Rate
Advances shall be made only on the last day of an Interest Period for such
Eurodollar Rate Advances and any Conversion of Base Rate Advances into
Eurodollar Rate Advances shall be in an amount not less than the minimum amount
specified in Section 2.01(a). Each such notice of a Conversion shall, within the
restrictions specified above, specify (a) the date of such Conversion; (b) the
Advances to be Converted; and (c) if such Conversion is into Eurodollar Rate
Advances, the duration of the initial Interest Period for each such Advance.
SECTION 2.09. Prepayments. (a) Optional Prepayments. The Borrower may, upon at
least three (3) Business Days' notice (in the case of Eurodollar Rate Advances)
or upon at least one Business Day's notice (in the case of Base Rate Advances)
to the Agent stating the proposed date and aggregate principal amount of the
prepayment, and if such notice is given the Borrower shall, prepay the
outstanding principal amount of the Advances comprising part of the same
Borrowing in whole or ratably in part, together with accrued interest to the
date of such prepayment on the principal amount prepaid; provided that (i) each
partial prepayment shall be in an aggregate principal amount of $10,000,000 or
an integral multiple of $1,000,000 in excess thereof; and (ii) in the event of
any such prepayment of a Eurodollar Rate Advance, the Borrower shall be
obligated to reimburse the Lenders in respect thereof pursuant to Section
8.04(c).
(b) Mandatory Prepayments. (i) Upon the occurrence of a Southern Event of
Default, the Borrower shall prepay, (A) with respect to all Projects which have
not yet achieved Substantial Completion, all Project Debt then outstanding with
respect to such Projects; and (B) with respect to each Substantially Completed
Project the Buydown Date for which has not then occurred, such portion of
Project Debt then outstanding with respect to such Substantially Completed
Project as is equal to the Buydown Amount for such Substantially Completed
Project, in each case, in accordance with clause (c) below.
(ii) Upon the occurrence of the Buydown Date for any Project, the Borrower shall
prepay (A) if Substantial Completion of such Project has not then been achieved,
all Project Debt then outstanding with respect to such Project; or (B) if
Substantial Completion of such Project has then been achieved, such portion of
such Project Debt as is equal to the Buydown Amount for such Project, in each
case, in accordance with clause (c) below.
(iii) On the date (the "Sale Prepayment Date") which is either (1) the earlier
of (A) the date falling six (6) months after any Sale; and (B) the prepayment
date specified in a prepayment notice from the Borrower with respect to the Sale
Proceeds from such Sale, or (2) the date specified in sub-clauses (B), (D) or
(F) below, if applicable, to the extent any Sale Proceeds from such Sale have
not been reinvested in a Similar Asset in accordance with Section 5.01(m), the
Borrower shall use such Sale Proceeds to prepay the then outstanding Project
Debt (but in no event more than in an amount equal to such Sale Proceeds) to the
extent necessary to result in the minimum and average Portfolio Adjusted Base
Case Projections, calculated on the assumption that all Recourse Debt of the
Borrower and the Relevant Subsidiaries outstanding immediately following such
prepayment is repaid in full on or prior to the end of the Remaining Base Case
Period, with such Debt being prepaid or repaid (as the case may be) in the
following order of priority: (A) Completed Project Advances, if any, on a pro
rata basis, together with interest thereon; (B) to the extent of any such Sale
Proceeds remaining thereafter, Commercial Paper, if any, then outstanding with
respect to Completed Projects, on the maturity date thereof and on a pro rata
basis, together with interest thereon (if any); (C) to the extent of any such
Sale Proceeds remaining thereafter, Advances, if any, then outstanding with
respect to the Asset the sale of which resulted in such Sale Proceeds, on a pro
rata basis, together with interest thereon; (D) to the extent of any such Sale
Proceeds remaining thereafter, Commercial Paper, if any, then outstanding with
respect to such Asset, on the maturity date thereof and on a pro rata basis,
together with interest thereon; (E) to the extent of any such Sale Proceeds
remaining thereafter, all other Advances, if any, then outstanding, on a pro
rata basis, together with interest thereon; and (F) to the extent of any such
Sale Proceeds remaining thereafter, all other Commercial Paper, if any, then
outstanding, on the maturity date thereof and on a pro rata basis, together with
interest thereon.
Contemporaneously with (AA) such prepayment of Advances, the
Project Limit for the relevant Project shall automatically be reduced by the
amount of such prepayment; and (BB) such repayment of Commercial Paper, each of
the Project Limit for the relevant Project and the CP Commitments of the Lenders
with respect to such Commercial Paper, if any, shall automatically be reduced
(on a pro rata basis) by the amount of such repayment.
(iv) Upon any Loss with respect to a Completed Project, the Borrower shall
repay, if required, the relevant Project Debt then outstanding in
accordance with Section 5.01(l).
(v) Within five (5) Business Days after receipt of the proceeds of any
Refinancing relating to any Project, and upon at least three (3)
Business Days' notice (in the case of Eurodollar Rate Advances) or upon
at least one Business Day's notice (in the case of Base Rate Advances)
to the Agent stating the proposed date and aggregate principal amount
of the payment, apply such proceeds to repay Project Debt then
outstanding with respect to such Project, and interest thereon, in
accordance with clause (c) below.
(c) All prepayments or repayments (as the case may be) of Project Debt with
respect to any particular Project pursuant to clause (b)(i), (ii), (iv)
and (v) above and Section 5.01(l) shall be made using funds other than
the proceeds of any Borrowing or any Commercial Paper as to which CP
Commitments are outstanding or requested, in the following order of
priority:
(i) firstly, to all Project Advances and all CP Advances, if any, made with
respect to such Project, on a pro rata basis, together with interest
thereon; and
(ii) secondly, upon the maturity thereof, to all Commercial Paper, if any,
then outstanding with respect to such Project and as to which CP
Commitments are then in effect, on a pro rata basis, together with
interest thereon (if any).
Contemporaneously with (A) such prepayment of Advances, the
Project Limit for the relevant Project shall automatically be reduced by the
amount of such prepayment; and (B) such repayment of Commercial Paper, each of
the Project Limit for the relevant Project and the CP Commitments of the Lenders
with respect to such Commercial Paper, if any, shall automatically be reduced
(on a pro rata basis) by the amount of such repayment.
SECTION 2.10. Increased Costs. The Borrower agrees to indemnify each Lender for
its actual and documented losses (whether due to decreased revenues or increased
costs) that are the result of a change of Law or in the official interpretation
thereof or compliance with any guideline or request from any central bank or
other Governmental Authority having jurisdiction over such Lender (whether or
not having the force of law) adopted or made (a) in the case of the Initial
Lenders, after the date of this Agreement; and (b) in the case of any other
Lender, after the date such Lender shall have become a party to this Agreement
by executing and delivering an Assignment and Acceptance or a Designation
Agreement (as the case may be), which costs are reasonably incurred by such
Lender and are the result of (i) such Lender agreeing to make or making, funding
or maintaining Eurodollar Rate Advances; or (ii) any increase in the amount of
capital required to be maintained by such Lender or any corporation controlling
such Lender, based upon the existence of such Lender's commitment to lend under
this Agreement and other commitments of this type, to the extent that such
Lender reasonably determines such increase in capital to be allocable to the
existence of such Lender's commitment to lend under this Agreement. The
foregoing indemnity shall not apply to (A) any such change of Law or
interpretation or any adoption or making of any such guideline or request that
is anticipated on the date of this Agreement, (B) any period or periods ending
more than one hundred and twenty (120) days prior to demand for indemnification
being made or (C) any such losses resulting from (1) Taxes or Other Taxes (as to
which Section 2.13 shall govern); or (2) changes in the basis of taxation of
overall net income or overall gross income by the United States or by the
foreign jurisdiction or state under the laws of which such Lender is organized
or has its Applicable Lending Office or any political subdivision thereof. The
Borrower shall from time to time, within thirty (30) days following demand by
such Lender complying with Section 8.04(d) (with a copy of such demand to the
Agent), pay to the Agent for the account of such Lender additional amounts
sufficient to compensate such Lender for such losses.
SECTION 2.11. Illegality. If as a result of a change in Law or in the official
interpretation thereof (a) in the case of the Initial Lenders, after the date of
this Agreement; and (b) in the case of any other Lender, after the date such
Lender shall have become a party to this Agreement by executing and delivering
an Assignment and Acceptance or a Designation Agreement (as the case may be), it
shall have become unlawful, or if after the applicable date set forth above any
central bank or other Governmental Authority having jurisdiction over such
Lender asserts that it is unlawful, for such Lender to (i) allow all or part of
its commitment to make Eurodollar Rate Advances to remain outstanding; or (ii)
make, fund or allow to remain outstanding all or part of its Eurodollar Rate
Advances, such Lender may notify the Borrower and the Agent thereof in
reasonable detail (together with supporting documentation) of such event,
whereupon:
(A) such Lender's obligations to make Eurodollar Rate Advances
shall be suspended and, forty-five (45) days following such
notification, shall be canceled if such unlawfulness shall then be
continuing; and
(B) the Borrower will prepay such Lender's Eurodollar Rate
Advances or convert them to Base Rate Advances at the time or times and
to the extent necessary to avoid such unlawfulness, together with
unpaid accrued interest thereon, unpaid accrued fees and any other
amounts due and payable to such Lender,
unless, in either case, prior thereto, the Borrower shall have given notice to
such Lender that the Borrower will require such Lender to assign and transfer
all of its interests in this Agreement pursuant to Section 8.07(b) and shall
have caused such Lender to have so assigned and transferred such interests.
SECTION 2.12. Payments and Computations. (a) The Borrower shall make each
payment under this Agreement and under the Notes not later than 11:00 A.M. (New
York City time) on the day when due in Dollars to the Agent at the Agent's
Account in same day funds. The Agent will promptly thereafter cause to be
distributed like funds relating to the payment of principal or interest or
commitment fees to the Lenders ratably in accordance with such amounts owing to
the Lenders for the account of their respective Applicable Lending Offices, and
like funds relating to the payment of any other amount payable to any Lender to
such Lender for the account of its Applicable Lending Office, in each case to be
applied in accordance with the terms of this Agreement; provided that unless
otherwise expressly provided in this Agreement, funds so paid by the Borrower on
account of any principal or interest due under this Agreement shall be applied
first to satisfy such amounts due with respect to Completed Project Advances and
Working Capital Advances, pari passu (or as otherwise specified by the
Borrower), and, after all such amounts are paid, to the corresponding amounts
due with respect to Uncompleted Project Advances. Upon its acceptance of an
Assignment and Acceptance or a Designation Agreement and recording of the
information contained therein in the Register pursuant to Section 8.07(d), from
and after the effective date specified in such Assignment and Acceptance or
Designation Agreement (as the case may be), the Agent shall make all payments
hereunder and under the Notes in respect of the interest assigned thereby to the
Lender assignee thereunder, and the parties to such Assignment and Acceptance or
Designation Agreement (as the case may be) shall make all appropriate
adjustments in such payments for periods prior to such effective date directly
between themselves.
(b) All computations of interest based on the Base Rate shall be made by the
Agent on the basis of a year of 365 or 366 days, as the case may be, and all
computations of interest based on the Eurodollar Rate or the Federal Funds
Effective Rate and of commitment fees shall be made by the Agent on the basis of
a year of 360 days, in each case for the actual number of days (including the
first day but excluding the last day) occurring in the period for which such
interest or commitment fees are payable. Each determination by the Agent of an
interest rate under this Agreement shall be conclusive and binding for all
purposes, absent manifest error.
(c) Whenever any payment under this Agreement or under the Notes shall be stated
to be due on a day other than a Business Day, such payment shall be made on the
next succeeding Business Day; provided that if such extension would cause
payment of interest on or principal of Eurodollar Rate Advances to be made in
the next following calendar month, such payment shall be made on the next
preceding Business Day. Any such extension or reduction of time shall be
included in the computation of payment of interest or commitment fee, as the
case may be.
(d) Unless the Agent shall have received notice from the Borrower prior to the
date on which any payment is due to the Lenders under this Agreement that the
Borrower will not make such payment in full, the Agent may assume that the
Borrower has made such payment in full to the Agent on such date and the Agent
may, in reliance upon such assumption, cause to be distributed to each Lender on
such due date an amount equal to the amount then due such Lender. If and to the
extent the Borrower shall not have so made such payment in full to the Agent,
each Lender shall repay to the Agent forthwith on demand such amount distributed
to such Lender together with interest thereon, for each day from the date such
amount is distributed to such Lender until the date such Lender repays such
amount to the Agent, at the Federal Funds Effective Rate.
SECTION 2.13. Taxes. (a) Any and all payments by the Borrower under this
Agreement or under the Notes shall be made, in accordance with Section 2.12,
without deduction for any Taxes or Other Taxes (each as defined below).
"Taxes" means any and all present or future taxes, levies,
imposts, deductions, charges or withholdings with respect to any
payment by the Borrower pursuant to this Agreement or any Note, and all
liabilities with respect thereto, excluding (i) in the case of each
Lender and the Agent, taxes imposed on its income, net worth or gross
receipts and franchise or similar taxes imposed on it by a jurisdiction
under the laws of which such Lender or the Agent (as the case may be)
is organized or in which its principal executive office is located or
any political subdivision thereof or, in the case of each Lender, in
which its Applicable Lending Office is located or any political
subdivision thereof; and (ii) in the case of each Lender, any United
States withholding tax imposed on such payments except to the extent
that such Lender is subject to United States withholding tax by reason
of a U.S. Tax Law Change.
"Other Taxes" means any present or future stamp or documentary
taxes and any other excise or property taxes, or similar charges or
levies, which arise from any payment made pursuant to this Agreement or
under any Note or from the execution or delivery of, or otherwise with
respect to, this Agreement or any Note.
"U.S. Tax Law Change" means with respect to any Lender the
occurrence (i) in the case of the Initial Lenders, after the date of
this Agreement; and (ii) in the case of any other Lender, after the
date such Lender shall have become a party to this Agreement by
executing and delivering an Assignment and Acceptance or a Designation
Agreement (as the case may be), of the adoption of any applicable
United States federal law or regulation relating to taxation, or any
change therein or in the official interpretation thereof, or the entry
into force, modification or revocation of any income tax convention or
treaty to which the United States is a party.
If the Borrower shall be required by Law to deduct any Taxes
or Other Taxes from or in respect of any sum payable under this Agreement or
under any Note to any Lender or the Agent, (i) the sum payable shall be
increased as may be necessary so that after making all required deductions
(including deductions applicable to additional sums payable under this Section
2.13) such Lender or the Agent (as the case may be) receives an amount equal to
the sum it would have received had no such deductions been made; (ii) the
Borrower shall make such deductions; (iii) the Borrower shall pay the full
amount deducted to the relevant taxation authority or other authority in
accordance with applicable Law; and (iv) the Borrower shall furnish to the
Agent, at its address referred to in Section 8.02, the original or a certified
copy of a receipt evidencing payment thereof.
(b) The Borrower agrees to indemnify each Lender and the Agent for the full
amount of actual and documented Taxes or Other Taxes (including taxes of any
kind imposed by any jurisdiction on amounts payable under this Section 2.13)
paid by such Lender or the Agent (as the case may be) as a result of any U.S.
Tax Law Change and any actual and documented liability (including penalties,
interest and expenses) arising therefrom or with respect thereto paid by such
Lender or the Agent (as the case may be), but excluding, however, any Taxes or
Other Taxes so paid by such Lender or the Agent more than one hundred and twenty
(120) days prior to demand being made to the Borrower by such Lender or the
Agent for indemnification. The payment of such indemnity shall be made within
thirty (30) days from the date such Lender or the Agent (as the case may be)
makes written demand therefor complying with Section 8.04(d).
(c) Each Lender organized under the laws of a jurisdiction outside the United
States, on or prior to the date of its execution and delivery of this Agreement
in the case of the Initial Lenders and on the date of the Assignment and
Acceptance or Designation Agreement (as the case may be) pursuant to which it
becomes a Lender in the case of any other Lender, and from time to time
thereafter as requested in writing by the Borrower or the Agent (but only so
long as such Lender remains lawfully able to do so), shall provide each of the
Agent and the Borrower with two completed and duly executed original Internal
Revenue Service forms W-8 W-8ECI or W-8BEN, as appropriate, or any successor or
other form prescribed by the Internal Revenue Service, or other documentation
reasonably requested by the Borrower or the Agent, certifying that such Lender
is exempt from or entitled to a reduced rate of United States withholding tax on
payments pursuant to this Agreement or the Notes. If the form provided by a
Lender at the time such Lender first becomes a party to this Agreement indicates
a United States interest withholding tax rate in excess of zero, withholding tax
at such rate shall be considered excluded from Taxes unless and until such
Lender provides the appropriate forms certifying that a lesser rate applies,
whereupon withholding tax at such lesser rate only shall be considered excluded
from Taxes for periods governed by such form. If any form or document referred
to in this subsection (c) requires the disclosure of information, other than
information necessary to compute the tax payable and information required on the
date of this Agreement by Internal Revenue Service form W-8, W-8ECI or W-8BEN,
that the Lender reasonably considers to be confidential, the Lender shall give
notice thereof to the Borrower and shall not be obligated to include in such
form or document such confidential information.
(d) For any period with respect to which a Lender has failed to provide the
Borrower with the appropriate form or document (or information required by such
form or document) described in Section 2.13(c) (other than if such failure is
due to a U.S. Tax Law Change), such Lender shall not be entitled to payments
without deduction and indemnification under Section 2.13(a) or (b) with respect
to any Taxes or Other Taxes which would not have been payable had such form or
document (or information required thereby) been so provided; provided that
should a Lender, which is otherwise exempt from or subject to a reduced rate of
withholding tax, become subject to Taxes because of its failure to deliver a
form or document (or information required thereby), required under Section
2.13(c), the Borrower shall take such reasonable steps as the Lender shall
request to assist the Lender to recover such Taxes (it being understood,
however, that the Borrower shall have no liability to such Lender in respect of
such Taxes).
(e) If the Borrower is required to indemnify or pay additional amounts to or for
the account of any Lender pursuant to this Section 2.13, then such Lender will
take such action (including changing the jurisdiction of its Applicable Lending
Office) as in the reasonable judgment of such Lender (i) will eliminate or
reduce any such additional payment which may thereafter accrue; and (ii) is not
otherwise commercially unreasonable.
(f) Each Lender and the Agent shall use its reasonable efforts to obtain in a
timely fashion any refund, deduction or credit of any Taxes and Other Taxes paid
or reimbursed by the Borrower pursuant to this Section 2.13. If any Lender or
the Agent receives a benefit in the nature of a refund, deduction or credit
(including a refund in the form of a deduction from or credit against taxes that
are otherwise payable by the Lender or the Agent) of any Taxes or Other Taxes
with respect to which the Borrower has made a payment under Section 2.13(a) or
(b), such Lender or the Agent (as the case may be) agrees to reimburse the
Borrower to the extent of the benefit of such refund, deduction or credit
promptly after the Agent or such Lender reasonably determines that such refund,
deduction or credit has become final; provided that nothing contained in this
subsection (f) shall require any Lender or the Agent (as the case may be) to
make available its tax returns (or any other information relating to its taxes
which it deems to be confidential) or to attempt to obtain any such refund,
deduction or credit, which attempt would be inconsistent with any reporting
position otherwise taken by the Agent or such Lender on its applicable tax
returns.
SECTION 2.14. Sharing of Payments, Etc. If any Lender shall obtain any payment
(whether voluntary, involuntary, through the exercise of any right of set-off,
or otherwise) on account of the Advances of any Nature owing to it (other than
pursuant to Section 2.02(c), 2.03, 2.10, 2.11, 2.13 or 8.04) in excess of its
ratable share of payments on account of Advances of the same Nature obtained by
all the Lenders, such Lender shall forthwith purchase from the other Lenders
such participations in the Advances of such Nature owing to them as shall be
necessary to cause such purchasing Lender to share the excess payment ratably
with each of them; provided that if all or any portion of such excess payment is
thereafter recovered from such purchasing Lender, such purchase from each Lender
shall be rescinded and each Lender shall repay to the purchasing Lender such
purchase price to the extent of such recovery together with an amount equal to
such Lender's ratable share (according to the proportion of (i) the amount of
such Lender's required repayment to (ii) the total amount so recovered from the
purchasing Lender) of any interest or other amount paid or payable by the
purchasing Lender in respect of the total amount so recovered. The Borrower
agrees that any Lender so purchasing a participation from another Lender
pursuant to this Section 2.14 may, to the fullest extent permitted by law,
exercise all its rights of payment (including the right of set-off) with respect
to such participation as fully as if such Lender were the direct creditor of the
Borrower in the amount of such participation.
SECTION 2.15. Reservation of CP Commitments. On the terms and conditions set
forth in this Agreement, each Lender shall allocate from time to time all or any
portion of its Commitment (such Lender's "CP Commitment") to provide liquidity
support for Commercial Paper issued or to be issued by the Borrower (i) with
respect to any Project, (ii) for the Borrower's general corporate purposes or to
provide working capital for the Borrower, and/or (iii) to allow the Borrower, as
permitted under this Agreement, to make a Restricted Payment or to repay
Affiliate Subordinated Debt; provided that such CP Commitment shall be
automatically reduced if and to the extent of all CP Advances made with respect
to such CP Commitment and, if requested by the Borrower, if and to the extent
the Commercial Paper issued with respect to which such CP Commitment was
established is not refinanced on its maturity by the issuance of Rollover
Commercial Paper. The Borrower may make more than one CP Commitment Reservation
on the same day; provided that (a) no more than two CP Commitment Reservations
of each Kind may be made during any one calendar month; and (b) only one CP
Commitment (Original CP) Reservation shall be permitted with respect to any
Project which is a Completed Project as of the Funds Availability Date or, if
later, the date of acquisition of such Project by a Borrower Group Member. Each
CP Commitment Reservation shall be made during the Availability Period, in an
aggregate amount of $10,000,000 or an integral multiple of $1,000,000 in excess
thereof and shall be made pro rata among all Lenders (according to their
respective Commitments) following notice by the Borrower, given not later than
the third Business Day prior to the date of a proposed CP Commitment
Reservation, to the Agent (which shall give to each Lender prompt notice
thereof), and upon a Utilization by way of CP Commitment Reservation, and to the
extent it is still outstanding, (A) the unused portion of the Commitments
available to the Borrower for Project Advances, Working Capital Advances and
other CP Commitment Reservations shall be reduced by the outstanding amount of
such Utilization; and (B) the Project Limit for such Project or the Borrowing
Limit for Working Capital Advances, as applicable, shall be reduced by the
outstanding amount of such Utilization. Each such notice of a CP Commitment
Reservation shall be by telephone, confirmed immediately by telecopier in
substantially the form of Exhibit B, (a) specifying therein (i) the requested
date of such CP Commitment Reservation and aggregate amount of such CP
Commitment Reservation; (ii) in the case of Original Commercial Paper, the
aggregate principal amount of the Commercial Paper issued, or to be issued, for
which such CP Commitment Reservation is requested (the amount of which
Commercial Paper shall equal the CP Commitment Reservation requested) and
specifying the relevant Project with respect to, or other purpose for, which
such Commercial Paper is, or is to be, issued; and (iii) in the case of
Refinancing Commercial Paper, the Project Advances, CP Advances, Working Capital
Advances or, as otherwise permitted hereunder, Affiliate Subordinated Debt or
Restricted Payments, as applicable, to be repaid or paid with proceeds from such
Commercial Paper; (b) containing a representation that proceeds of such
Commercial Paper will be used (i) to finance or refinance Project Costs
(including, in the case of any Project, repayment of any Affiliate Subordinated
Debt incurred by the Borrower (A) to fund the costs of acquiring such Project
and Project Costs paid in respect of such Project prior to the initial Advances
hereunder in respect of such Project, or (B) to pay Project Costs in respect of
such Project at any time prior to the Non-Recourse Date for such Project)
incurred for such Project, for the Borrower's general corporate purposes or to
provide working capital for the Borrower, and/or to allow the Borrower, as
permitted under this Agreement, to make a Restricted Payment or to repay
Affiliate Subordinated Debt (in the case of a CP Commitment (Original CP)
Reservation), and/or (ii) to repay outstanding Project Advances made with
respect to such Project or to repay outstanding Working Capital Advances (in the
case of a CP Commitment (Refinancing CP) Reservation); and (c) specifying the
aggregate principal amount of all outstanding Advances, the unused Commitments
and all outstanding CP Commitments, in each case, after giving effect to the
proposed CP Commitment Reservation, issuance of such Commercial Paper and
application of proceeds therefrom. All repayments of Commercial Paper made on
the same day shall be applied (I) first, to amounts due on such date with
respect to Commercial Paper relating to Completed Projects, Commercial Paper
issued for the Borrower's general corporate purposes or to provide working
capital for the Borrower and Commercial Paper issued to make a Restricted
Payment or to repay Affiliate Subordinated Debt (as permitted by this
Agreement), pari passu (or as otherwise specified by the Borrower), and (II)
after all such amounts are paid, to amounts due on such date with respect to
Commercial Paper relating to Uncompleted Projects.
SECTION 2.16. Use of Proceeds. The proceeds of Advances shall be used (a) to
finance Project Costs, to repay any Affiliate Subordinated Debt incurred by the
Borrower to fund the acquisition and construction of any Project prior to the
date of the initial Advances hereunder with respect to such Project or to repay
any Affiliate Subordinated Debt incurred by the Borrower to pay Project Costs of
any Project at any time prior to the Non-Recourse Date for such Project (such
Advances, "Project Advances"); (b) for the Borrower's general corporate purposes
or to provide working capital for the Borrower (such Advances, "Working Capital
Advances"); or (c)(i) to pay amounts due under Commercial Paper issued by the
Borrower (A) to finance or refinance Project Costs (including to repay CP
Advances used to pay amounts due under Commercial Paper issued to finance or
refinance Project Costs) with respect to any Project up to the CP Commitment
Reservation(s) previously established for such Project, (B) for the Borrower's
general corporate purposes or to provide working capital for the Borrower up to
the CP Commitment Reservation(s) previously established for such purpose, and/or
(C) to allow the Borrower, as permitted under this Agreement, to make a
Restricted Payment or to repay Affiliate Subordinated Debt up to the CP
Commitment Reservation(s) previously established for such purpose; or (ii) to
pay amounts due or owing under Affiliate Subordinated Debt issued to repay
Commercial Paper issued by the Borrower up to the CP Commitment Reservation(s)
previously established in connection with such Commercial Paper (any of such
Advances under subparagraphs (c)(i) and (c)(ii), "CP Advances").
Article III
CONDITIONS TO EFFECTIVENESS AND LENDING
SECTION 3.01. Conditions Precedent to Effectiveness of this Agreement. This
Agreement shall become effective on and as of the first date (the "Amendment
Effective Date") on which the following conditions precedent have been
satisfied:
(a) The Borrower shall have paid all accrued fees and expenses of the Agent
and the Lenders (including the accrued fees and expenses of each of
special New York counsel and regulatory counsel to the Agent) that are
then due and payable.
(b) On the Amendment Effective Date, (i)(a) the Borrower shall represent and
warrant that no approval or authorization or other action by, or notice to
or filing, registration or qualification with, any Governmental Authority
is required for the due execution, delivery or performance by the Borrower
of this Agreement and the transactions contemplated hereby, except for
those which have been duly obtained or made and are in full force and
effect, and (b) the Borrower shall represent and warrant that as of the
Amendment Effective Date no Affiliate Subordinated Debt is outstanding
other than Affiliate Subordinated Debt held by Southern, and (ii) the Agent
shall have received for the account of each Lender a certificate to such
effect signed by a duly authorized officer of the Borrower.
(c) The Agent shall have received on or before the Amendment Effective Date
the following, each dated such day and in sufficient copies for each
Lender:
(i) Letter Amendment No. 1 to Completion Guarantee, dated the date hereof,
among the Borrower, Southern and the Agent and Letter Amendment No. 1
to Equity Contribution Agreement, dated the date hereof, among the
Borrower, Southern and the Agent, each duly executed by the Loan
Parties;
(ii) the Master Assignment and Acceptance, duly executed by the parties
thereto;
(iii) a Note payable to the order of each Lender, duly executed by the
Borrower;
(iv) opinions of counsel for the Loan Parties, substantially in the
respective forms of Exhibit E; and
(v) an opinion of Shearman & Sterling, counsel for the Agent.
(d) The Borrower shall have received a reaffirmation from S&P and Moody's
of a rating of BBB+/Baa1, respectively, on the Debt under the Facility
(giving effect to the Southern Completion Guarantee) as of the
Amendment Effective Date, a copy of which shall have been delivered to
the Agent.
(e) Prior to delivering an executed counterpart of this Agreement, the
Lenders shall have received a reasonably satisfactory report from the
Independent Engineer and Environmental Consultant and a reasonably
satisfactory report from the Independent Market Consultant.
SECTION 3.02. [Intentionally Omitted].
SECTION 3.03. Conditions Precedent to Subsequent Advances for an Initial
Project. The obligation of each Lender to make a Project Advance on the occasion
of each Borrowing after the first Borrowing, in each case, with respect to any
Initial Project shall be subject to the following conditions precedent:
(a) All representations and warranties contained in Section 4.01 (other than
those listed in Sections 4.01(h) and (j)) and all representations and
warranties contained in Sections 4 and 2 of the Southern Completion
Guarantee and the Southern Equity Agreement (other than Sections 4(f) and
(h) and 2(f) and (h), respectively), are true and correct in all material
respects on and as of the date of such Borrowing, before and after giving
effect to such Borrowing and to the application of the proceeds therefrom,
as though made on and as of such date (and each of the giving of the
applicable Notice of Utilization and the acceptance by the Borrower of the
proceeds of such Borrowing shall constitute a representation and warranty
made herein, with respect to Section 4.01 and to Sections 4 and 2 of the
Southern Completion Guarantee and the Southern Equity Agreement,
respectively, by the Borrower to such effect).
(b) The Agent shall have received, together with or prior to
delivery of the Notice of Utilization with respect to such
Borrowing, a certificate of the Borrower:
(i) certifying the Project Costs, including construction and
related costs, interest and commitment fees, that have been
incurred in connection with such Project since the immediately
preceding Borrowing related to it;
(ii) confirming that (A) except as otherwise provided in clause (B) below, all
Borrowings previously made to the Borrower for such Project were applied to
pay Project Costs for, or to repay Affiliate Subordinated Debt incurred
with respect to, such Project in accordance with this Agreement; and (B)
the proceeds of such Borrowing, and of the immediately preceding Borrowing
(but only to the extent not previously applied in accordance with clause
(A) above), will be applied (1) to Project Costs in respect of such Project
which have been paid, are then due or will become due within three (3)
months from the date of such Borrowing (or, in the case of the last
Borrowing with respect to such Project only, then due or to become due
after the date of such Borrowing), in each case, in accordance with this
Agreement; or (2) to repay any Affiliate Subordinated Debt incurred by the
Borrower to pay Project Costs in respect of such Project at any time prior
to the Non-Recourse Date for such Project; and
(iii) certifying that proceeds of the Borrowing shall be used to
fund, pro rata with Equity Contributions, Project Costs for
such Project so that the ratio of outstanding Debt to Equity
Contributions, in each case, with respect to such Project does
not exceed the Debt/Equity Ratio applicable to such Project,
as at the date of such Borrowing and after giving effect to
such Borrowing and such Equity Contributions, and the
application of proceeds therefrom.
SECTION 3.04. Conditions Precedent to the Initial Advances for Each Subsequent
Project. The obligation of each Lender to make a Project Advance on the occasion
of the first Borrowing with respect to any Subsequent Project shall be subject
to the following conditions precedent:
(a) If, at the time of such Borrowing, the Borrower does not have an
Investment Grade Rating:
(i) All representations and warranties of the Borrower contained in Section
4.01 and all representations and warranties of Southern contained in
Sections 4 and 2 of the Southern Completion Guarantee and the Southern
Equity Agreement, respectively, are true and correct in all material
respects on and as of the date of such Borrowing, before and after giving
effect to such Borrowing and to the application of the proceeds therefrom,
as though made on and as of such date (and each of the giving of the
applicable Notice of Utilization and the acceptance by the Borrower of the
proceeds of such Borrowing shall constitute a representation and warranty
made herein, with respect to Section 4.01, by the Borrower to such effect).
(ii) The Agent shall have received no later than thirty (30) days before such
Borrowing a certificate of the Borrower:
(A) certifying that such Project will not cause the number of Subsequent
Projects (including such Project) to be greater than two (2) or cause
the projected aggregate amount of Utilizations made or to be made under
the Facility related to Subsequent Projects, including such Project (in
each case, as set forth in their respective Project Budgets), to exceed
$500,000,000;
(B) attaching an Initial Project Budget (together with a calculation by the
Borrower, and agreed to by the Agent, showing a determination of the
Initial Project Limit for such Project) and a Project Schedule for such
Project;
(C) attaching Project Base Case Projections for such Project, together with
a statement of the assumptions underlying such projections
demonstrating the Required Project DSCR applicable to such Project;
(D) certifying that, including such Project, Peakers represent no more than
25% of the total megawatt capacity owned by the Borrower and all
Relevant Subsidiaries; and
(E) certifying the Project Costs, including construction and related costs,
acquisition cost, construction interest and commitment fees, as the
case may be, incurred in connection with such Project prior to such
Borrowing.
(iii) The Agent shall have received, together with or prior to delivery of
the Notice of Utilization with respect to such Borrowing, a certificate
of the Borrower:
(A) certifying that proceeds of the Borrowing shall be used to fund, pro
rata with Equity Contributions, Project Costs for such Project so that
the ratio of outstanding Debt to Equity Contributions, in each case,
with respect to such Project does not exceed the Debt/Equity Ratio
applicable to such Project, as at the date of such Borrowing and after
giving effect to such Borrowing and such Equity Contributions, and the
application of proceeds therefrom;
(B) attaching resolutions of the Borrower authorizing such Project; and
(C) if such Project is a Peaker only, attaching details (as agreed with the
Independent Engineer and Environmental Consultant) of testing
procedures applicable to, and a seven day reliability run to be
successfully completed as a condition for, Substantial Completion of
such Project.
(iv) The Agent shall have received no later than thirty (30) days before
such Borrowing:
(A) If such Project is an Uncompleted Project, a certificate of Southern
certifying that each of the Southern Completion Guarantee and the
Southern Equity Agreement is still in full force and effect and has not
been amended since the Amendment Effective Date except to apply to
Subsequent Projects.
(B) If such Project is an Uncompleted Project, the Southern Completion
Guarantee and the Southern Equity Agreement, in each case, amended in
accordance with the terms thereof to extend its terms to apply to such
Project.
(C) A certificate of the Independent Engineer and Environmental Consultant
with respect to such Project, substantially in the form of Exhibit I-2.
(D) A certificate of the Independent Insurance Consultant with respect to
such Project, substantially in the form of Exhibit J-2.
(E) A certificate of the Independent Market Consultant with respect to such
Project, substantially in the form of Exhibit K-2.
(v) If such Project is not wholly owned by a Borrower Group Member, each
other owner shall, on or before the date of such Borrowing, have
contributed its pro rata share of Project Costs or in the event that
any such third party owner fails to contribute its pro rata share of
Project Costs, the Borrower shall have funded such Project Costs
through Equity Contributions.
(b) If, at the time of such Borrowing, the Borrower has an Investment Grade
Rating:
(i) All representations and warranties contained in Section 4.01 and all
representations and warranties contained in Sections 4 and 2 of the
Southern Completion Guarantee and the Southern Equity Agreement,
respectively, are true and correct in all material respects on and as of
the date of such Borrowing, before and after giving effect to such
Borrowing and to the application of the proceeds therefrom, as though made
on and as of such date (and each of the giving of the applicable Notice of
Utilization and the acceptance by the Borrower of the proceeds of such
Borrowing shall constitute a representation and warranty made herein, with
respect to Section 4.01, by the Borrower to such effect).
(ii) The Agent shall have received, together with or prior to delivery of
the Notice of Utilization with respect to such Borrowing, an
affirmation by Moody's and S&P of the Investment Grade Rating for the
Borrower, taking into account such Project and the Debt to be incurred
with respect thereto.
(iii) The Agent shall have received no later than thirty (30) days before such
Borrowing a certificate of the Borrower:
(A) attaching an Initial Project Budget (together with a calculation by the
Borrower, and agreed to by the Agent, showing a determination of the
Initial Project Limit for such Project) and a Project Schedule for such
Project;
(B) attaching Project Base Case Projections for such Project, together with a
statement of the assumptions underlying such projections demonstrating the
Required Project DSCR applicable to such Project; provided that the
Required Project DSCR need not be satisfied during any Stub Period for such
Project if (1) such Stub Period does not exceed one year in duration; (2)
the relevant PPA Documents for such Project are executed on or before such
Borrowing; and (3) Stub Periods shall apply to no more than two Subsequent
Projects (including such Project, and no more than one of which may be a
Peaker), at any time, the aggregate Project Costs of which does not exceed
$400,000,000;
(C) certifying that, including such Project, Peakers represent no more than
25% of the total megawatt capacity owned by the Borrower and all
Relevant Subsidiaries; and
(D) certifying the Project Costs, including construction and related costs,
acquisition cost, construction interest and commitment fees, as the
case may be, incurred in connection with such Project prior to such
Borrowing.
(iv) The Agent shall have received, together with or prior to delivery of
the Notice of Utilization with respect to such Borrowing, a certificate
of the Borrower:
(A) certifying that proceeds of such Borrowing are used to fund, pro rata
with Equity Contributions, Project Costs for such Project so that the
ratio of outstanding Debt to Equity Contributions, in each case, with
respect to such Project does not exceed the Debt/Equity Ratio
applicable to such Project, as at the date of such Borrowing and after
giving effect to such Borrowing and such Equity Contributions, and the
application of proceeds therefrom;
(B) attaching resolutions of the Borrower authorizing such Project; and
(C) if such Project is a Peaker only, attaching details (as agreed with the
Independent Engineer and Environmental Consultant) of testing
procedures applicable to, and a seven day reliability run to be
successfully completed as a condition for, Substantial Completion of
such Project.
(v) The Agent shall have received no later than thirty (30) days before
such Borrowing:
(A) If such Project is an Uncompleted Project, a certificate of Southern
certifying that each of the Southern Completion Guarantee and the
Southern Equity Agreement are still in full force and effect and has
not been amended since the Amendment Effective Date except to apply to
Subsequent Projects.
(B) If such Project is an Uncompleted Project, the Southern Completion
Guarantee and the Southern Equity Agreement, in each case, amended in
accordance with the terms thereof to extend its terms to apply to such
Project.
(C) A certificate of the Independent Engineer and Environmental Consultant
with respect to such Project, substantially in the form of Exhibit I-2.
(D) A certificate of the Independent Insurance Consultant with respect to
such Project, substantially in the form of Exhibit J-2.
(E) A certificate of the Independent Market Consultant with respect to such
Project, substantially in the form of Exhibit K-2.
(vi) If such Project is not wholly owned by any Borrower Group Member, each
other owner shall, on or before the date of such Borrowing, have
contributed its pro rata share of Project Costs or in the event that
any such third party owner so fails to contribute its pro rata share of
Project Costs, the Borrower shall have funded such Project Costs
through Equity Contributions.
(c) The Agent shall have received no later than thirty (30) days before such
Borrowing, a certificate of the Borrower attaching certified copies of the
executed PPA Documents for such Project (if any, and if not previously
provided to the Lenders in satisfaction of Section 3.01(c)(ix)(D) of the
Original Credit Agreement, and certifying that such PPA Documents (i)
either (A) conform to the relevant form provided to the Lenders in
satisfaction of Section 3.01(c)(ix)(D) of the Original Credit Agreement; or
(B) substantially and accurately reflect the term sheet provided to the
Lenders in satisfaction of Section 3.01(c)(ix)(D) of the Original Credit
Agreement or comply with all of the PPA Parameters, and do not contain any
additional terms not set forth in such term sheet or the PPA Parameters (as
applicable) which impose additional material obligations outside the
ordinary course of business of the industry generally on, or otherwise
materially reduce the benefit to, any Borrower Group Member under such PPA
Documents; or (C) are one or more of the EMC Contracts; and (ii) are in
full force and effect, and that all necessary regulatory approvals required
to be obtained with respect to such PPA Documents under all Federal and
State Energy Laws and Regulations have been obtained, are in full force and
effect and are final and non-appealable but for any Filing Conditions, and
do not contain any restrictions, conditions or requirements which are then
required to be satisfied and have not been satisfied, other than any Filing
Conditions. If such PPA Documents are one or more of the EMC Contracts, the
certificate of the Borrower shall also certify that, to the best of the
Borrower's knowledge, (A) no "MAC" (as defined in such EMC Contract) has
occurred to the applicable EMC Counterparty since the date of this
Agreement, (B) no event of the type specified in Section 6.01(f) hereof has
occurred in respect of the EMC Counterparty since the date of this
Agreement, (C) no material adverse change in the membership profile of the
EMC Counterparty has occurred since the date of this Agreement, (D) the
fuel pass-through mechanism included in such EMC Contract provides a
reasonable method for the Borrower to recover fuel related costs under such
EMC Contract, and (E) the capacity and variable O&M charges included in
such EMC Contract are reasonably sufficient to cover the fixed and variable
operations and maintenance costs of the Borrower in meeting its obligations
thereunder.
SECTION 3.05. Conditions Precedent to Subsequent Advances for a Subsequent
Project. The obligation of each Lender to make a Project Advance on the occasion
of each Borrowing after the first Borrowing, in each case, with respect to any
Subsequent Project shall be subject to the following conditions precedent:
(a) All representations and warranties contained in Section 4.01 (other than
those listed in Sections 4.01(h) and (j)) and all representations and
warranties contained in Sections 4 and 2 of the Southern Completion
Guarantee and the Southern Equity Agreement (other than Sections 4(f) and
(h) and 2(f) and (h), respectively), are true and correct in all material
respects on and as of the date of such Borrowing, before and after giving
effect to such Borrowing and to the application of the proceeds therefrom,
as though made on and as of such date (and each of the giving of the
applicable Notice of Utilization and the acceptance by the Borrower of the
proceeds of such Borrowing shall constitute a representation and warranty
made herein, with respect to Section 4.01 and to Sections 4 and 2 of the
Southern Completion Guarantee and the Southern Equity Agreement,
respectively, by the Borrower to such effect).
(b) The Agent shall have received, together with or prior to
delivery of the Notice of Utilization with respect to such
Borrowing, a certificate of the Borrower:
(i) certifying the Project Costs, including construction and
related costs, construction interest and commitment fees, that
have been incurred in connection with such Project since the
immediately preceding Borrowing related to it;
(ii) confirming that (A) except as otherwise provided in clause (B) below, all
Borrowings previously made to the Borrower for such Project were applied to
pay Project Costs for, or to repay Affiliate Subordinated Debt incurred
with respect to, such Project in accordance with this Agreement; and (B)
the proceeds of such Borrowing, and of the immediately preceding Borrowing
(but only to the extent not previously applied in accordance with clause
(A) above), will be applied (1) to Project Costs in respect of such Project
which have been paid, are then due or will become due within three (3)
months from the date of such Borrowing (or, in the case of the last
Borrowing with respect to such Project only, then due or to become due
after the date of such Borrowing), in each case, in accordance with this
Agreement; or (2) to repay any Affiliate Subordinated Debt incurred by the
Borrower to pay Project Costs in respect of such Project at any time prior
to the Non-Recourse Date for such Project; and
(iii) certifying that proceeds of the Borrowing shall be used to
fund, pro rata with Equity Contributions, Project Costs for
such Project so that the ratio of outstanding Debt to Equity
Contributions, in each case, with respect to such Project does
not exceed the Debt/Equity Ratio applicable to such Project,
as at the date of such Borrowing and after giving effect to
such Borrowing and such Equity Contributions, and the
application of proceeds therefrom.
SECTION 3.06. Conditions Precedent to CP Commitment Reservations. The obligation
of each Lender to establish a CP Commitment on the occasion of each CP
Commitment Reservation shall be subject to the following conditions precedent:
(a) In the case of the first CP Commitment (Original CP) Reservation for
any Initial Project requested prior to the first Borrowing with respect
to such Initial Project, the satisfaction of all conditions referred to
in Sections 3.02(a) through (e) inclusive of the Original Credit
Agreement, with all references therein to "Borrowing" and proceeds of
any Borrowing thereunder being read and construed as references to "CP
Commitment (Original CP) Reservation" and the proceeds of the
Commercial Paper with respect to which such CP Commitment (Original CP)
Reservation is being requested, where appropriate.
(b) In the case of any CP Commitment (Original CP) Reservation requested
after the first Borrowing or the first CP Commitment Reservation, in
each case with respect to an Initial Project, the satisfaction of all
conditions referred to in Section 3.03(a) and (b), with all references
therein to "Borrowing" and proceeds of any Borrowing thereunder being
read and construed as references to "CP Commitment (Original CP)
Reservation" and the proceeds of the Commercial Paper for which such CP
Commitment (Original CP) Reservation is being requested, where
appropriate.
(c) In the case of any CP Commitment (Refinancing CP) Reservation requested
with respect to any Initial Project, the satisfaction of the condition
referred to in Section 3.03(a), with all references therein to
"Borrowing" and proceeds of any Borrowing thereunder being read and
construed as references to "CP Commitment (Refinancing CP) Reservation"
and the proceeds of the Project Advances being refinanced by the
Refinancing Commercial Paper for which such CP Commitment (Refinancing
CP) Reservation is being requested, where appropriate.
(d) In the case of the first CP Commitment (Original CP) Reservation for
any Subsequent Project requested prior to the first Borrowing with
respect to such Subsequent Project, the satisfaction of all conditions
referred to in Sections 3.04(a) through (c) inclusive, with all
references therein to "Borrowing" and proceeds of any Borrowing
thereunder being read and construed as references to "CP Commitment
(Original CP) Reservation" and the proceeds of the Commercial Paper
with respect to which such CP Commitment (Original CP) Reservation is
being requested, where appropriate.
(e) In the case of any CP Commitment (Original CP) Reservation requested
after the first Borrowing or the first CP Commitment Reservation, in
each case, with respect to a Subsequent Project, the satisfaction of
all conditions referred to in Section 3.05(a) and (b), with all
references therein to "Borrowing" and proceeds of any Borrowing
thereunder being read and construed as references to "CP Commitment
(Original CP) Reservation" and the proceeds of the Commercial Paper for
which such CP Commitment (Original CP) Reservation is being requested,
where appropriate.
(f) In the case of any CP Commitment (Refinancing CP) Reservation requested
with respect to any Subsequent Project, the satisfaction of the
condition referred to in Section 3.05(a), with all references therein
to "Borrowing" and proceeds of any Borrowing thereunder being read and
construed as references to "CP Commitment (Refinancing CP) Reservation"
and the proceeds of the Project Advances being refinanced by the
Refinancing Commercial Paper for which such CP Commitment (Refinancing
CP) Reservation is being requested, where appropriate.
(g) In the case of any CP Commitment Reservation requested in connection
with Commercial Paper issued, or to be issued, for the Borrower's
general corporate purposes or to provide working capital for the
Borrower or to repay CP Advances, the satisfaction of all conditions
referred to in Section 3.07(a), and (b), with all references therein to
"Borrowing" and proceeds of any Borrowing thereunder being read and
construed as references to "CP Commitment (Original CP) Reservation" or
"CP Commitment (Refinancing CP) Reservation", as applicable, and the
proceeds of the Commercial Paper with respect to which such CP
Commitment Reservation is being requested, where appropriate.
(h) In the case of any CP Commitment Reservation requested in connection with
Commercial Paper issued, or to be issued, to allow the Borrower to make a
Restricted Payment or repay Affiliate Subordinated Debt, in each case as
permitted under this Agreement, the satisfaction of (i) all conditions
referred to in Section 3.07(a), with all references therein to "Borrowing"
and proceeds of any Borrowing thereunder being read and construed as
references to "CP Commitment (Original CP) Reservation" and the proceeds of
the Commercial Paper with respect to which such CP Commitment Reservation
is being requested, where appropriate, and (ii) the condition that the
amount of such CP Commitment Reservation shall not exceed the aggregate
principal amount of Debt and/or Commercial Paper repaid by the Borrower
with the Borrower's cash generated from operations, as certified by the
Borrower quarterly and at the time of any CP Commitment Reservation under
this Section 3.06(h) in notice(s) to the Agent, less any amount that the
Borrower would have been required to prepay under Sections 2.09(b)(i),
2.09(b)(ii) or 2.09(b)(iii), but for the repayment for which such notice(s)
is given, if a Relevant Event occurred during the period from the earliest
date of any such repayment specified in the relevant notice(s) up to and
including the date of such CP Commitment Reservation.
SECTION 3.07. Conditions Precedent to the Working Capital and CP Advances. The
obligation of each Lender to make a Working Capital Advance or a CP Advance with
respect to an existing CP Commitment Reservation on the occasion of the related
Borrowing thereto, shall be subject to the following conditions precedent:
(a) All representations and warranties contained in Section 4.01 (other than
those listed in Sections 4.01(h) and (j)) and all representations and
warranties contained in Sections 4 and 2 of the Southern Completion
Guarantee and the Southern Equity Agreement (other than Sections 4(f) and
(h) and 2(f) and (h), respectively), are true and correct in all material
respects on and as of the date of such Borrowing, before and after giving
effect to such Borrowing and to the application of the proceeds therefrom,
as though made on and as of such date (and each of the giving of the
applicable Notice of Utilization and the acceptance by the Borrower of the
proceeds of such Borrowing shall constitute a representation and warranty
made herein, with respect to Section 4.01 and to Sections 4 and 2 of the
Southern Completion Guarantee and the Southern Equity Agreement,
respectively, by the Borrower to such effect); provided, however, that in
addition to the foregoing requirements of this Section 3.07(a), if such
Borrowing is to repay Affiliate Subordinated Debt issued to repay
Commercial Paper for which such CP Commitment Reservation was established,
(i) the representations and warranties contained in Sections 4.01(h) and
(j) shall be true and correct in all material respects on and as of the
date of such Borrowing, before and after giving effect to such Borrowing
and to the application of proceeds therefrom, as though made on and as of
such date, and (ii) to the extent such Borrowing is in respect of an
Uncompleted Project for which there are outstanding Utilizations, the
representations and warranties contained in Sections 4(f) and (h) of the
Southern Completion Guarantee and Sections 2(f) and (h) of the Southern
Equity Agreement shall be true and correct in all material respects on and
as of the date of such Borrowing, before and after giving effect to such
Borrowing and to the application of proceeds therefrom, as though made on
and as of such date.
(b) The Agent shall have received a certificate of the Borrower certifying
that the proceeds of such Borrowings shall be used (i) in the case of a
Borrowing comprising of Working Capital Advances, for the Borrower's
working capital or general corporate purposes; and (ii) in the case of
a Borrowing comprising CP Advances, for payment of (A) obligations
owing with respect to Commercial Paper for which such CP Commitment
Reservation was established, or (B) Affiliate Subordinated Debt issued
to repay Commercial Paper for which such CP Commitment Reservation was
established.
(c) In the case of a Borrowing comprising of Working Capital Advances, the
Agent shall have received a certificate of the Borrower certifying that
the aggregate outstanding amount of all Working Capital Advances,
before and after giving effect to such Advance and to the application
of the proceeds therefrom, does not exceed $50,000,000.
SECTION 3.08. Determinations Under Sections 3.01 Through 3.07, Inclusive. For
purposes of determining compliance with the conditions specified in Sections
3.01 through 3.07, inclusive, each Lender shall be deemed to have consented to,
approved or accepted or to be satisfied with each document or other matter
required thereunder to be consented to or approved by or acceptable or
satisfactory to the Lenders unless an officer of the Agent responsible for the
transactions contemplated by this Agreement shall have received notice from such
Lender prior to the Amendment Effective Date (in the case of Section 3.01) or
the date of the relevant Borrowing or CP Commitment Reservation, as applicable
(in all other cases), specifying its objection thereto. The Agent shall promptly
notify the Lenders of the occurrence of the Amendment Effective Date.
Article IV
REPRESENTATIONS AND WARRANTIES
SECTION 4.01. Representations and Warranties of the Borrower.
The Borrower represents and warrants as follows:
(a) Organization. The Borrower is a corporation duly organized, validly
existing and in good standing under the laws of the State of Delaware.
Each Relevant Subsidiary is a limited liability company or a
corporation duly organized, validly existing and in good standing under
the laws of the jurisdiction of its organization. Each Borrower Group
Member is duly qualified or licensed and in good standing in each other
jurisdiction in which it owns or leases property or in which the
conduct of its business requires it to so qualify or be licensed.
(b) Power and Authority. Each Borrower Group Member has the power to
execute, deliver and perform its obligations under each Material
Document to which it is or is to be a party and to take all action
necessary to consummate the transactions contemplated by each such
Material Document.
(c) Due Authorization. The execution, delivery and performance by each Borrower
Group Member of each Material Document to which it is or is to be a party
(including, with respect to any applicable PPA Document, the assignment of
rights to, and the assumption of liabilities by, such Borrower Group Member
thereunder) and the transactions contemplated thereby have been duly
authorized by all necessary action and do not (i) contravene its
certificate of incorporation or bylaws (or similar constitutive or
governing documents); or (ii) conflict with or contravene any Law to which
it or any of its Assets are subject which has had or would reasonably be
expected to have a Material Adverse Effect as to the Borrower.
(d) Governmental Approval. No authorization or approval or other action by, and
no notice to or filing with, any Governmental Authority is required for the
due execution, delivery and performance by the Borrower of the Loan
Documents, or the transactions contemplated thereby, except for those which
have been duly obtained or made and are in full force and effect. With
respect to each Project for which a Utilization is then outstanding or a
Notice of Utilization has been issued by the Borrower, no authorization or
approval or other action by, and no notice to or filing with, any
Governmental Authority is then required for the due execution, delivery and
performance by each Borrower Group Member of the PPA Documents relating to
such Project and to which it is or is to be a party, or the transactions
contemplated thereby, except for those which have been duly obtained or
made and are in full force and effect.
(e) Binding and Enforceable. The Material Documents constitute the legal,
valid and binding obligation of each Borrower Group Member party
thereto, enforceable against the Borrower Group Member party thereto in
accordance with their respective terms, subject to Laws affecting the
enforcement of creditors' rights generally and to general principles of
equity.
(f) No Violation. The execution, delivery and performance by each Borrower
Group Member of each Material Document to which it is a party do not
violate, in a manner which has had or would reasonably be expected to
have a Material Adverse Effect as to the Borrower, any agreement
binding on it.
(g) No Default. No Default or Event of Default has occurred and is
continuing, other than any Default or Event of Default which has been
waived.
(h) Litigation. No litigation, arbitration or administrative proceeding is
currently pending or, to the Borrower's knowledge, threatened against
any Borrower Group Member (i) to restrain the entry by such Borrower
Group Member into, the enforcement of, or exercise of any rights by the
Lenders or the Agent under, or the performance or compliance by such
Borrower Group Member with any obligations under, any Material Document
to which it is a party; (ii) which has had or would reasonably be
expected to have a Material Adverse Effect; or (iii) which purports to
affect the legality, validity or enforceability of any such Material
Document or the transactions contemplated thereby.
(i) Financial Condition. The unaudited consolidated balance sheet of the
Borrower and its consolidated Subsidiaries as at December 31, 2002,
heretofore furnished to the Lenders, fairly presents in all material
respects the consolidated financial condition of the Borrower and its
consolidated Subsidiaries as at such date in accordance with GAAP.
(j) Material Adverse Change. There has been no change in the business,
condition (financial or otherwise) or results of operations of the
Borrower or its consolidated Subsidiaries since December 31, 2002 which
has had or would reasonably be expected to have a Material Adverse
Effect as to the Borrower.
(k) Taxes. There has been no matter with respect to payment of taxes or
filing of tax returns which has had or would reasonably be expected to
have a Material Adverse Effect as to the Borrower.
(l) Investment Company Act. Neither the Borrower nor any of its
Subsidiaries is an "investment company" registered or required to be
registered under the Investment Company Act of 1940, as amended, or is
a company "controlled" by an "investment company", in each case, as
such terms are defined in such Act.
(m) Environmental Matters. To the knowledge of the Borrower, there has been
no matter with respect to environmental compliance which has had or
would reasonably be expected to have a Material Adverse Effect as to
the Borrower.
(n) Accuracy of Information. To the knowledge of the Borrower (i) the
Information Memorandum (other than the projections included therein) was
complete and correct in all material respects on and as of the date
thereof; and (ii) all financial projections contained in the Information
Memorandum were prepared in good faith and based upon assumptions which
management of the Borrower believed to be not unreasonable at the time the
projections were prepared (it being understood that (A) such projections
are subject to significant uncertainties and contingencies, many of which
are beyond the Borrower's control; (B) no assurance can be given that the
projections will be realized; and (C) no representation or warranty can be
made as to the accuracy of such projections).
(o) Affiliate Transactions. All transactions between a Borrower Group
Member and an Affiliate thereof are on arm's-length terms or are "at
cost", in each case, in accordance with PUHCA or applicable rules and
regulations issued pursuant thereto.
(p) ERISA. (i) No Reportable Event has occurred and is continuing with
respect to any Plan; (ii) no Plan has an accumulated funding deficiency
determined under Section 412 of the Code; (iii) no proceedings have
been instituted or, to the knowledge of the Borrower, planned to
terminate any Plan; (iv) neither the Borrower, nor any member of a
Controlled Group, nor any duly appointed administrator of a Plan has
instituted or intends to institute proceedings to withdraw from any
Multiemployer Pension Plan (as defined in Section 3(37) of ERISA); and
(v) each Plan has been maintained and funded in all material respects
in accordance with its terms and with the provisions of ERISA
applicable thereto.
(q) PUHCA and FPA. The Borrower is an "electric utility company" (as defined in
PUHCA). No authorization or approval by, or notice to or filing with, any
Governmental Authority is required for (i) the acquisition of each Project
by a Borrower Group Member, other than those which, on or prior to the
first Utilization with respect to such Project, have been duly obtained or
made and are in full force and effect; or (ii) the issuance of the Notes,
the incurrence of the Debt contemplated under this Agreement and the
borrowing, repayment and reborrowing of the Advances, other than those
which have been duly obtained or made and are in full force and effect. All
necessary rate schedules are on file and effective with the Federal Energy
Regulatory Commission for the Borrower Group Members to sell power at
wholesale. The Borrower reasonably believes that timely interconnection
agreements for the Projects will be available in the ordinary course.
(r) No Subsidiary. The Borrower has not had any Subsidiaries on or prior to
the Amendment Effective Date other than Southern Company-Florida LLC
and limited liability companies wholly owned by the Borrower and formed
for the purpose of acquiring land on which future generation Plants may
be built.
(s) Title to Property. Except for the Permitted Encumbrances, with respect
to all real property necessary for, or material to, the development,
ownership, operation and maintenance of the Projects and which is not
leased by it, each Borrower Group Member has such title as a reputable
title company doing business in the state in which such real property
is located would insure, subject to such exceptions as would not
materially affect the contemplated use of such property by such
Borrower Group Member, and with respect to all such real property which
is leased by a Borrower Group Member, such lease is the legal, valid
and binding obligation of the lessor thereof, enforceable in accordance
with its terms.
Article V
COVENANTS OF THE BORROWER
SECTION 5.01. Affirmative Covenants. So long as any Advance shall remain
unpaid or any Lender shall have any Commitment under this
Agreement, the Borrower will:
(a) Ratio of Recourse Debt to Recourse Capital. At the end of each fiscal
quarter (including the fourth fiscal quarter) of the Borrower for which
financial statements have most recently been delivered to the Agent by the
Borrower pursuant to Section 5.01(d) or (e), cause the ratio of Recourse
Debt to Total Capitalization to be not more than 0.65:1:00 (65%),
calculated as of the date of such financial statements; provided that at
the Borrower's election, (i) capital contributions or Affiliate
Subordinated Debt made to the Borrower within forty-five (45) days after
the end of such fiscal quarter, net of Restricted Payments made by the
Borrower during such 45-day period, shall be taken into account in
calculating Total Capitalization as at the end of such fiscal quarter; and
(ii) if any such capital contribution or Affiliate Subordinated Debt is
made to the Borrower and included for such calculation, the incurrence or
repayment, if any, of Debt during such 45-day period, shall also be taken
into account in calculating Recourse Debt as at the end of such fiscal
quarter; provided further that until such time ---------------- as the
Franklin 3 Plant meets the conditions precedent that would entitle such
Plant to become a Subsequent Project under this Agreement, an amount of
equity and/or Affiliate Subordinated Debt equal to any capital costs paid
or incurred by the Borrower with respect to the acquisition and
construction of the Franklin 3 Plant shall not be included in the
calculation of the ratio of Recourse Debt to Total Capitalization under
this Section 5.01(a).
(b) Compliance with Law. Comply, and cause each Relevant Subsidiary to
comply, with the requirements of all Laws applicable to it in the
conduct of its business, where failure to do so would reasonably be
expected to have a Material Adverse Effect.
(c) Maintenance of Existence. Preserve and maintain, and cause each Relevant
Subsidiary to preserve and maintain, its legal existence as a corporation
or limited liability company and the rights, licenses, permits, privileges,
properties and franchises material to its business, except that (i) the
Borrower may be merged or consolidated with or into another Person if the
continuing or surviving Person is the Borrower or is organized under the
laws of any State of the United States; and (ii) the Borrower may be
converted into a limited liability company upon giving notice to the Agent
at least ten (10) Business Days prior to such conversion if such limited
liability company expressly assumes all of the obligations of the Borrower
under each Material Document to which it is a party; provided that in each
case (A) -------- immediately before the consummation of such transaction
there is no Default or Event of Default; (B) such consummation shall not
result in a Default or Event of Default; and (C) the resulting Person shall
have delivered evidence of its due organization, incumbency of officers or
managers, and unless all of the Borrower's obligations under the Material
Documents to which the Borrower is a party have been assumed by operation
of law by such resulting Person, a certified copy of the agreement pursuant
to which such resulting Person assumes all such obligations, and an opinion
of counsel, in each case, in form reasonably satisfactory to the Agent, and
certified copies of such Person's constitutive and other governing
documents.
(d) Annual Financial Statements, Etc. Within one hundred and twenty (120)
days after the end of each fiscal year of the Borrower (beginning with
the fiscal year 2002), deliver to the Agent copies for the Lenders of
its consolidated financial statements as of the end of and for such
fiscal year duly certified by the independent accountants of the
Borrower. Such financial statements shall be prepared in accordance
with GAAP and shall be accompanied by a certificate of the chief
financial officer or the treasurer of the Borrower as to compliance
with the terms of this Agreement and setting forth in reasonable detail
the calculations necessary to demonstrate compliance with Section
5.01(a).
(e) Interim Financial Statements, Etc. Within sixty (60) days after the end of
each of the first three fiscal quarters of each fiscal year of the Borrower
(beginning with the first such fiscal quarter to end after December 31,
2002), deliver to the Agent copies for the Lenders of its unaudited
consolidated financial statements as of the end of and for such fiscal
quarter duly certified (subject to year-end adjustments) by the chief
financial officer or the treasurer of the Borrower as having been prepared
in accordance with GAAP (except as to the omission of footnotes). Such
financial statements shall be accompanied by a certificate of the chief
financial officer or the treasurer of the Borrower as to compliance with
the terms of this Agreement and setting forth in reasonable detail the
calculations necessary to demonstrate compliance with Section 5.01(a).
(f) Other Information. Deliver to the Agent as soon as reasonably
practicable such other information relating to the then existing
financial condition of the Borrower and its consolidated Subsidiaries
as the Agent may from time to time reasonably request, except such
information the disclosure of which is prohibited by Law or by
regulatory requirement applicable to the Borrower.
(g) Notice of Default. Promptly, and in any event within ten (10) Business
Days, notify the Agent of the occurrence of any Default or Event of
Default of which the chief financial officer or treasurer of the
Borrower has actual knowledge.
(h) Notice Concerning PPA Documents. Promptly notify the Agent of (i) the
entry by any Borrower Group Member into a PPA Document and any issuance
of Acceptable Credit Support in favor of a Borrower Group Member; and
(ii) the termination of any PPA Document prior to its stated
expiration.
(i) Project Information. Promptly, and in any event within ten (10) Business
Days, after delivery of a cash basis financial statement to the Agent
pursuant to Section 5.01(d) or (e), notify the Agent if the ratio of Cash
Available for Corporate Debt Service to Corporate Interest is 2.00:1.00 or
less or, if the Borrower does not have at least an Investment Grade Rating,
2.25:1.00 or less, in each case, as calculated on a rolling four (4) fiscal
quarter basis commencing from the first fiscal quarter to commence after
Substantial Completion is achieved for any Project which, as of the date of
this Agreement or the date of the first Utilization with respect thereto,
is an Uncompleted Project and ending on the date of such financial
statement (or, if at such time less than four (4), but at least two (2),
such fiscal quarters have ended, as calculated for the fiscal quarters
ending on the date of such financial statement), and deliver to the Agent
as soon as reasonably practicable such information relating to the
completion testing, operations and maintenance of any Completed Project for
review by the Independent Engineer and Environmental Consultant as the
Agent (acting upon the instructions of the Majority Lenders) may from time
to time thereafter reasonably request, except such information the
disclosure of which is prohibited by Law or by regulatory requirement
applicable to the Borrower.
(j) Inspection Rights, Etc. Permit the Agent or any Lender or any agents or
representatives thereof to examine and make copies of and abstracts from
records and books of, and visit the properties of, any Borrower Group
Member to discuss the affairs, finances and accounts of, any Borrower Group
Member with any of its officers or directors and with its independent
certified public accountants from time to time during normal business hours
upon reasonable notice. The Lenders and the Agent agree that the Agent
shall coordinate and consolidate visits by Lenders and their agents and
representatives (including the examination of records and books and the
making of copies and abstracts of records and books) at mutually convenient
times and in such a manner so as to minimize the disruption to the
operations of the Borrower Group Members and the costs associated with such
visits.
(k) Project PPA Documents. Obtain the consent of the Majority Lenders prior
to any material amendment to, or termination prior to its stated
expiration by any Borrower Group Member of, any Project PPA Document,
which in the case of any such termination, is not replaced by another
Project PPA Document satisfying the PPA Parameters.
(l) Insurance. (i) Insurance. (A) At all times maintain in full force and
effect insurance (including worker's compensation insurance, liability
insurance, casualty insurance and business interruption insurance) in
such amounts, covering such risks and liabilities and with such
deductibles or self-insurance retentions as are in accordance with
normal industry practice; provided that such coverages (and limits and
deductibles) may be modified due to, but only to the extent of, the
unavailability of such coverages at commercially reasonable rates or on
commercially reasonable terms.
(B) Review its insurance program at least annually, on each
anniversary of the Funds Availability Date.
(ii) Insurance Account. Upon the occurrence of any Loss which may reasonably
be expected to result in payment of Loss proceeds exceeding, in the
aggregate, $1,000,000, and in any event prior to receipt by any
Borrower Group Member of such proceeds, establish an account with the
Agent to hold and disburse such proceeds in accordance with this
Section 5.01(l).
(iii) Total Loss. Except as otherwise provided in the last sentence of this
sub-clause (iii), in the event of a total Loss of any Completed Project
(with respect to which there are Utilizations then outstanding or
Commitments then available under the Facility), promptly apply all proceeds
of insurance (other than business interruption insurance), condemnation
awards or other recoveries to prepay all outstanding Project Debt
associated with such Project in accordance with Section 2.09(c), unless the
Borrower certifies to the Agent, within sixty (60) days after receipt of
such proceeds in an aggregate amount equal to at least 30% of the Total
Project Costs for such Completed Project that: (1) all such insurance
proceeds have been, or upon receipt shall be immediately, deposited by a
Borrower Group Member into the Insurance Account; (2) it will reinstate
such Project or replace it with a Similar Asset; (3) all conditions
precedent specified in Sections 3.04(a) through (c) inclusive (but with (x)
all references to "Borrowing" therein being read and construed as
references to the first disbursement from the Insurance Account and all
references therein to "Project" being read and construed as references to
such Project (in the case of a reinstatement) or such Similar Asset (in the
case of a replacement); and (y) the certification referred to in Section
3.04(a)(iii)(A) certifying instead that the ratio of outstanding Debt to
Equity Contributions for such Project or Similar Asset (as the case may be)
does not exceed the Debt/Equity Ratio applicable thereto, as at the date of
the first disbursement from the Insurance Account, and after giving effect
to such disbursement and any Equity Contributions as of the date thereof,
and the application of proceeds therefrom) are then satisfied with respect
to the reinstatement or replacement of such Project; (4) there are
sufficient funds to do so (taking into account all undisputed proceeds to
be paid and all committed equity contributions into the Borrower); and (5)
such reinstatement or replacement is technically feasible, then, such
proceeds may be held in the Insurance Account and disbursed from time to
time to pay Project Costs for reinstating such Project or for such
replacement Similar Asset (x) if all conditions precedent specified in
Section 3.05(a) and (b) (but with (AA) all references to "Borrowing"
therein being read and construed as references to a disbursement from the
Insurance Account and all references therein to "Project" being read and
construed as references to such Project (in the case of a reinstatement) or
such Similar Asset (in the case of a replacement); and (BB) the
certification referred to in Section 3.05(b)(iii) certifying instead that
the ratio of outstanding Debt to Equity Contributions for such Project or
Similar Asset (as the case may be) does not exceed the Debt/Equity Ratio
applicable thereto, as at the date of the relevant disbursement from the
Insurance Account, and after giving effect to such disbursement and any
Equity Contributions as of the date thereof, and the application of
proceeds therefrom) are then satisfied; and (y) where the aggregate of all
such proceeds is less than the Project Costs for such reinstatement or
replacement (as the case may be), if Project Costs are funded pro rata
between disbursements from the Insurance Account and Equity Contributions
to be paid with respect to such reinstatement or replacement. To the extent
any such proceeds in excess of $1,000,000 are not used for such
reinstatement or replacement, they shall, upon completion of such
reinstatement or replacement (as applicable) be applied to prepay the
outstanding Project Debt made with respect to such Project in accordance
with Section 2.09(c).
(iv) Partial Loss. In the event of a partial Loss of any Completed Project (with
respect to which there are Utilizations then outstanding or Commitments
then available under the Facility), deal with such proceeds of insurance
(other than business interruption), condemnation awards or other recoveries
in the following manner: if such proceeds (A) do not exceed $1,000,000 in
the aggregate with respect to such Loss, apply them at the Borrower's sole
discretion; (B) exceed $1,000,000 but not $5,000,000 in the aggregate with
respect to such Loss, use such proceeds to prepay the outstanding Project
Debt made with respect to such Project in accordance with Section 2.09(c)
to the extent such proceeds (in excess of $1,000,000 in the aggregate with
respect to such Loss) are not used to repair or reinstate such Project,
upon completion of such repair or reinstatement; (C) exceed $5,000,000 but
not 10% of the Total Project Costs for such Project with respect to such
Loss, apply such proceeds to repair or reinstate the affected Project if
the Borrower certifies to the Agent, within sixty (60) days after receipt
of proceeds equal to at least $5,000,000 (but with all such proceeds to be
reserved by the Borrower until such certification is made or until
prepayment is required pursuant to this Section 5.01(l)(iv)) that (1) it
will repair or reinstate such Project; (2) there are sufficient funds to do
so (taking into account all undisputed proceeds to be paid and committed
equity contributions into the Borrower); and (3) such repairs or
reinstatements are technically feasible; otherwise, all such proceeds in
excess of --------- $1,000,000 not used for such repair or reinstatement
shall, upon completion of such repair or reinstatement, be promptly applied
to prepay the outstanding Project Debt made with respect to such Project in
accordance with Section 2.09(c); and (D) exceed 10% of the Total Project
Costs for such Completed Project, apply such proceeds to repair or
reinstate the affected Project if consent from the Majority Lenders shall
have been obtained; otherwise, all such proceeds shall be used promptly to
prepay --------- the outstanding Project Debt made with respect to such
Project in accordance with Section 2.09(c).
(m) Asset Sales. To the extent the Borrower has not reinvested Sale Proceeds
arising from any Sale in a Similar Asset, by way of the purchase or lease
(pursuant to a Development Authority Sale/Leaseback) of such Similar Asset,
within six (6) months after such Sale (any such reinvestment being subject
to satisfaction of all conditions precedent specified in Sections 3.04(a)
through (c) inclusive as of the date of the Borrower's initial investment
in such Similar Asset (but (i) with all references to "Borrowing" therein
being read and construed as references to such investment and all
references therein to "Project" being read and construed as references to
such Similar Asset; and (ii) the certification referred to in Section
3.04(a)(iii)(A) certifying instead that the ratio of outstanding Debt to
Equity Contributions for such Similar Asset does not exceed the Debt/Equity
Ratio applicable thereto, as at the date of such investment, and after
giving effect to such investment and any Equity Contributions as of the
date thereof, and the application of proceeds therefrom)), the Borrower
shall prepay the outstanding Debt under the Facility to the extent required
under Section 2.09(b)(iii); provided that the Borrower -------- shall be
permitted to apply all Sale Proceeds remaining thereafter, if any, to make
a Restricted Payment in accordance with Section 5.02(b).
(n) Regulatory Approvals. Obtain and maintain, and cause each Relevant
Subsidiary to obtain and maintain, in full force and effect all
necessary authorizations and approvals by, and deliver all necessary
notices to and undertake all necessary filings with, each Governmental
Authority which are required, in each case, for the Borrower and such
Subsidiary to sell, at wholesale, the entire output of each electric
generation plant (including the Projects) owned by the Borrower or such
Subsidiary, as the case may be.
(o) Initial Projects. As long as an Initial Project is owned, directly or
indirectly, by the Borrower, own, or procure that a wholly owned
Subsidiary of the Borrower (other than an Unrestricted Subsidiary) will
own, such Project.
(p) Granting of Benefits under Certain Circumstances. If in connection with
obtaining a waiver or a curative amendment of a "default" or an "event of
default" under a document under which any Debt of the Borrower in a
principal or notional amount equal to or in excess of $50,000,000 is
outstanding or which evidences any such Debt, any creditor in respect of
such Debt will obtain any benefit (including collateral security, a
guarantee or other third-party support and improved financial terms), offer
to the Lenders the same benefit (including ratable collateral security and
guarantees and third-party support and comparably improved terms) and, upon
the acceptance by the Majority Lenders of such offer, cause such benefit to
be made available to the Lenders concurrently with making such benefit
available, and on substantially the same terms as it is made available, to
such other creditor.
(q) Notice of Change of Investment Grade Rating. Promptly, and in any event
within ten (10) days, after the Borrower is notified thereof in writing
by S&P or Moody's (as applicable), or the chief financial officer or
the treasurer of the Borrower becomes aware of the public announcement
thereof by S&P or Moody's (as applicable), notify the Agent of either
(i) any downgrade in the Borrower's Investment Grade Rating by S&P or
Moody's, as the case may be; or (ii) mention of the Borrower with
negative implication in "Credit Watch", or the equivalent thereof by
either of S&P or Moody's.
(r) Updated Documents. Upon (i) the earlier of the Non-Recourse Date and the
Refinancing Date for any Project, deliver to the Agent an Adjusted Project
Budget setting forth Project Costs incurred, as of such date, with respect
to such Project; and (ii) each Relevant Event, deliver to the Agent an
updated Independent Market Consultant report with respect to all Relevant
Completed Plants as at such Relevant Event (including where such Relevant
Event is a Southern Event of Default or a Buydown Event, all Substantially
Completed Projects for which a Buydown Amount is to be paid as a result of
such Relevant Event) based, in the case of each Plant which has then
achieved (A) Final Completion, on the performance of such Plant, as
certified by Southern to the Agent for purposes of its Final Completion;
and (B) Substantial Completion but not Final Completion, on the performance
of such Plant, as certified by Southern to the Agent for purposes of its
Substantial Completion, and, in each case, which is verified by the
Independent Engineer and Environmental Consultant as being consistent with
the performance (output, heat rate, environmental and permit compliance and
availability) of such Plant.
(s) Project Bonds. As long as any Project is owned by a development
authority created and existing under the laws of the State of Georgia
and is leased by a Borrower Group Member, hold, or procure that a
wholly owned Subsidiary of the Borrower shall hold, free and clear of
any Liens, all legal and beneficial title to all Project Bonds issued
with respect to a Development Authority Sale/Leaseback of such Project.
SECTION 5.02. Negative Covenants. So long as any Advance shall remain unpaid or
any Lender shall have any Commitment under this Agreement, the Borrower will
not:
(a) Debt. Incur, and will not permit any Subsidiary of the Borrower to incur,
any Debt other than (i) Recourse Debt under the Facility; (ii) Recourse
Debt the proceeds of which (after customary transaction fees and costs) are
applied to the concurrent repayment of Debt; (iii) if the Borrower has at
least an Investment Grade Rating and such rating of the Borrower is
reaffirmed after incurrence of such other Debt, Recourse Debt or, in the
case of Lease Obligations, Debt of the related lessor, that has been rated
at least "Baa3" by Moody's and "BBB-" by S&P; (iv) Recourse Debt the
repayment in full of which is guaranteed by Southern or another Affiliate
which has at least an Investment Grade Rating; (v) Debt that is incurred by
an Unrestricted Subsidiary on a basis that is without recourse to the
Borrower other than with respect to the Borrower's ownership interest in
such Unrestricted Subsidiary; (vi) Debt which is secured by Liens referred
to in Section 5.02(c)(iv), (vi), (vii), (viii), (ix), (x), (xvi) or (xvii)
or (vii) Affiliate Subordinated Debt. Notwithstanding the above, the
Borrower will ensure that no Relevant Subsidiary which owns or leases a
Project with respect to which Advances are then outstanding, or for which
Commitments are then available, shall incur any Debt, other than Debt
referred to in clause (vi) above.
(b) Restricted Payments. (i) Declare or make any Restricted Payment; (ii) make
any payments with respect to Affiliate Subordinated Debt (other than any
Affiliate Subordinated Debt loaned (A) prior to the initial Utilization
hereunder in respect of any Project, to the Borrower to fund its
acquisitions of such Project, (B) to the Borrower to pay Project Costs of
any Project at any time prior to the Non-Recourse Date for such Project, or
(C) to the Borrower to repay any Commercial Paper issued by the Borrower
for which a CP Commitment Reservation has previously been established) or
make any redemption or repurchase of any Affiliate Subordinated Debt
(except for any payment, redemption or repurchase of Affiliate Subordinated
Debt from insurance proceeds for casualties which have been restored with
the proceeds of such Affiliate Subordinated Debt); or (iii) purchase,
redeem or otherwise acquire for value any shares of any class of capital
stock of the Borrower or any warrants, rights or options to acquire any
such shares, now or hereafter outstanding, or reduce the Borrower's capital
(except for any purchase, redemption or acquisition of such shares held by
Southern or any reduction of capital paid to an Affiliate of the Borrower
from insurance proceeds for casualties which have been restored with the
proceeds of such shares or such capital, as the case may be); provided that
the Borrower may once each -------- calendar month on, or within three (3)
Business Days after, the date of, and (x) using proceeds of the Project
Advances or Commercial Paper (as applicable) arising from, or relating to,
a Utilization with respect to any Project, repay any Affiliate Subordinated
Debt loaned to the Borrower to pay Project Costs of such Project at any
time prior to the Non-Recourse Date thereof (including interest, fees and
other charges, if any, paid with respect to such Affiliate Subordinated
Debt to the extent that the same does not exceed the maximum rate or amount
permitted under PUHCA (whether or not such law is repealed)), and/or (y)
using proceeds of CP Advances or Commercial Paper (as applicable) arising
from, or relating to, a Utilization, repay any Affiliate Subordinated Debt
loaned to the Borrower to repay Commercial Paper issued by the Borrower for
the Borrower's general corporate purposes or to provide working capital for
the Borrower (including interest, fees and other charges, if any, paid with
respect to such Affiliate Subordinated Debt to the extent that the same
does not exceed the maximum rate or amount permitted under PUHCA (whether
or not such law is repealed)); and provided further, that the Borrower
-------- ------- may (A) declare and make any Restricted Payment payable in
common stock of the Borrower; (B) purchase, redeem or otherwise acquire
shares of its common stock or warrants, rights or options to acquire any
such shares with the proceeds received from the substantially concurrent
contribution to the Borrower's capital or the issue of new shares of the
Borrower's common stock; and (C) make any payments with respect to
Affiliate Subordinated Debt (other than Affiliate Subordinated Debt
referenced to in the preceding proviso), make any redemption or repurchase
of Affiliate Subordinated Debt and take any other action specified in
clauses (i), (ii) and (iii) above if, in any such case, (x) no Default or
Event of Default shall have occurred and is continuing; and (y) at the end
of the fiscal quarter (including the fourth fiscal quarter) of the Borrower
for which a cash basis financial statement has been delivered to the Agent
pursuant to Section 5.01(d) or (e) most recently preceding the date on
which the Borrower takes such action, (1) the ratio of Cash Available for
Corporate Debt Service to Corporate Interest was at least 2.00:1.00 or, if
the Borrower does not have at least an Investment Grade Rating, 2.25:1.00,
in each case, calculated on a rolling four (4) fiscal quarter basis ending
on the date of such financial statement (or, if at such time less than four
(4) fiscal quarters have ended, such lesser number of fiscal quarters and
with effect from the date of such delivery of such financial statement) and
(2) either (x) the percentage derived from dividing Contracted Operating
Cash Flow by Total Operating Cash Flow is at least 80% or (y) the
Borrower's ratio of Recourse Debt to Total Capitalization is 0.60:1.00
(60%) or lower. Any such cash basis financial statement shall be certified
by the chief financial officer or the treasurer of the Borrower as having
been prepared in accordance with the books and records of the Borrower.
(c) Liens. Without the consent of the Majority Lenders, create or
have outstanding, or permit the creation of, any Lien on or
over any Assets of the Borrower or any of its Subsidiaries
except for:
(i) Liens arising solely by operation of law or by order of a
court or tribunal or other Governmental Authority (or by an
agreement of similar effect);
(ii) Liens arising in the ordinary course of business or
operations, in respect of overdue amounts which either (A)
have not been overdue for more than thirty (30) days; or (B)
are being contested in good faith and for which adequate
reserves have been set aside in accordance with GAAP;
(iii) Liens created for the sole purpose of refinancing all
outstanding Advances; provided that the Advances are
simultaneously prepaid in full, all Commitments cancelled and
no amounts are then owing under this Agreement;
(iv) Liens arising out of title retention or like provisions in
relation to the acquisition of goods or equipment acquired in
the ordinary course of business or operations;
(v) Liens created or arising on ownership interests and documents
evidencing ownership interests in (A) an Unrestricted
Subsidiary which is the primary obligor in respect of Project
Finance Debt; or (B) a Subsidiary all the Assets of which
consist of ownership interests in (x) an Unrestricted
Subsidiary which is the primary obligor in respect of Project
Finance Debt; or (y) another Person described in this clause
(B), which Liens secure such Project Finance Debt only;
(vi) Liens on deposits to secure, or any Lien otherwise securing,
the performance of bids, trade contracts (other than for
borrowed money), operating leases other than Synthetic Leases,
statutory obligations, surety bonds, appeal bonds, performance
bonds and other obligations of a like nature incurred in the
ordinary course of business;
(vii) Liens, other than Liens on a Project or the Assets comprising
a Project or the ownership interests in all Persons directly
or indirectly owning such Project, securing reimbursement
obligations under letters of credit, guarantees and other
forms of credit enhancement given in the ordinary course of
business;
(viii) Liens created or arising over any Asset which is acquired, constructed or
created by the Borrower (excluding any Assets acquired or constructed with
the use of a Synthetic Lease), but only if (A) such Lien secures only
principal amounts (not exceeding the cost of such acquisition, construction
or creation) raised for the purposes of such acquisition, construction or
creation, together with any costs, expenses, interest and fees incurred in
relation thereto or a guarantee given in respect thereof; (B) such Lien is
created or arises on or before ninety (90) days after the completion of
such acquisition, construction or creation; (C) such Lien is confined
solely to the property so acquired, constructed or created; and (D) the
aggregate principal amount secured by all such Liens and by Liens (if any)
under subparagraphs (ix) and (xvii) below, does not exceed $75,000,000;
(ix) Liens (A) outstanding on or over any Asset acquired after the
date of this Agreement; (B) in existence at the date of such
acquisition; (C) where the Borrower does not take any step to
increase the principal amount secured thereby from that so
secured and outstanding at the time of such acquisition (other
than in the case of Liens for a fluctuating balance facility,
by way of utilization of that facility within the limits
applicable thereto at the time of acquisition); and (D) the
aggregate principal amount secured under such Liens, and by
Liens (if any) under subparagraphs (viii) above and (xvii)
below, does not exceed $75,000,000;
(x) Liens created or arising over any Asset which is acquired or constructed by
the Borrower with the use of a synthetic financing or Synthetic Lease, but
only if (A) such Lien secures only principal amounts (not exceeding the
cost of such acquisition or construction (including any contingency amount
relating to such acquisition or construction)) raised for the purposes of
such acquisition or construction through such synthetic financing or
Synthetic Lease, together with any costs, expenses, interest and fees and
indemnities incurred in relation thereto or a guarantee given in respect
thereof; (B) such Lien is created or arises on or before ninety (90) days
after the completion of such acquisition or construction; and (C) such Lien
is confined solely to the property so acquired or constructed;
(xi) Liens constituted by a right of set-off (including a bank's
right of set-off with respect to deposit accounts) or rights
over a margin call account or any form of cash collateral or
any similar arrangement for obligations incurred in respect of
any currency, commodity or interest rate swap, option, forward
rate, or futures contracts or any other arrangement for the
hedging or management of risks entered into on commercial
terms;
(xii) Liens in favor of a plaintiff or defendant in any action
before a court or tribunal as security for costs or expenses
where such action is being prosecuted or defended in the bona
fide interest of the Borrower;
(xiii) Liens described in any of subparagraphs (iv) through (xi)
above or (xiv) through (xvii) below and renewed or extended
upon the renewal or extension or refinancing or replacement of
the indebtedness secured thereby; provided that there is no
increase in the principal amount of the indebtedness secured
thereby over the principal, capital or nominal amount thereof
outstanding immediately prior to such refinancing;
(xiv) Liens existing on the date of this Agreement;
(xv) Liens on the property of a Person existing at the time such
Person is merged into or consolidated with the Borrower or any
of its Subsidiaries and not incurred in contemplation with
such merger or consolidation;
(xvi) Liens created or arising over any land which is acquired by the Borrower
or any of its Subsidiaries, but only if (A) such Lien secures only
principal amounts (not exceeding the cost of such acquisition) raised for
the purpose of such acquisition or which are secured by such land at the
time of its acquisition, together with any costs, expenses, interest and
fees incurred in relation thereto or a guarantee given in respect thereof;
(B) such Lien is created or arises on or before ninety (90) days after the
completion of such acquisition; (C) such Lien is confined solely to the
land so acquired; and (D) the aggregate principal amount secured by all
such Liens does not exceed $25,000,000; and
(xvii) Liens created or outstanding on or over Assets of the Borrower
or any Relevant Subsidiary; provided that the aggregate
outstanding principal, capital or nominal amount secured by
all Liens created or outstanding under this subparagraph
(xvii) on or over Assets of the Borrower and all Relevant
Subsidiaries shall not at any time exceed $25,000,000.
Notwithstanding anything else contained herein, an Unrestricted
Subsidiary may create or have outstanding any Lien on or over its
Assets to secure the payment of such Unrestricted Subsidiary's Debt.
(d) Activities. Engage in, and will not permit any of its Subsidiaries to
engage in, any business activities other than activities which the
Borrower and its Subsidiaries may undertake under PUHCA (whether or not
such law is repealed); provided that in the event PUHCA is repealed,
any Unrestricted Subsidiary shall not be so restricted.
(e) Acquisitions. Acquire, and will ensure that no Relevant Subsidiary will
acquire, from a non-Affiliate of the Borrower any Project that has
achieved Final Completion without first obtaining the consent of the
Majority Lenders.
(f) Affiliate Transactions. Except as otherwise required by Law, enter
into, or permit any Relevant Subsidiary to enter into, any transaction
or series of transactions, whether or not in the ordinary course of
business, with any of its Affiliates other than on terms and conditions
substantially as favorable as would be obtainable in a comparable
arm's-length transaction with a Person other than an Affiliate.
Article VI
EVENTS OF DEFAULT
SECTION 6.01. Events of Default. If any of the following events ("Events of
Default") shall occur and be continuing:
(a) Payments. The Borrower shall fail to pay (i) any principal of any
Advance when the same becomes due and payable; or (ii) any interest on
any Advance or any fees or other amounts payable under this Agreement
within five (5) Business Days after the same becomes due and payable;
provided that failure to pay any principal, interest or other amounts
required under Section 2.09(b)(i) shall not constitute a default by the
Borrower or an Event of Default unless such failure is still continuing
as of the Final Maturity Date, whereupon it shall, on such date, become
an Event of Default; or
(b) Representations and Warranties. Any representation or warranty made by
the Borrower in this Agreement shall prove to have been materially
incorrect when made and, if the underlying facts or circumstances
making such representation or warranty incorrect are susceptible of
cure, it shall not have been cured within thirty (30) days after
written notice thereof has been given by the Agent to the Borrower (or
such longer period as the Majority Lenders may permit); or
(c) Covenants. The Borrower shall fail to perform or comply with (i)
Section 5.01(g); or (ii) any other material term, covenant or agreement
contained in this Agreement on its part to be performed or observed and
such failure under clause (ii) shall remain unremedied for thirty (30)
days after written notice thereof has been given by the Agent to the
Borrower (or such longer period as the Majority Lenders may permit); or
(d) Cross-default. The Borrower or any Relevant Subsidiary shall fail to pay
any principal of, or premium or interest on, any of its Debt that is
outstanding in a principal or notional amount equal to or in excess of
$50,000,000, in the aggregate, for all such unpaid Debt (but excluding Debt
outstanding under the Facility) when such Debt becomes due and payable
(whether by scheduled maturity, required prepayment, acceleration, demand
or otherwise), and such failure shall continue after the applicable grace
period, if any, specified in the agreement or instrument relating to such
Debt; or any other event shall occur or condition shall exist under the
agreement or instrument relating to any such Debt and shall continue after
the applicable grace period, if any, specified in such agreement or
instrument, if the effect of such event or condition is to accelerate the
maturity of such Debt by reason of default; or any such Debt shall be
declared due and payable, or be required to be prepaid or redeemed (other
than by a regularly scheduled required prepayment or redemption), purchased
or defeased, or an offer to prepay, redeem, purchase or defease such Debt
shall be required to be made, in each case, prior to the scheduled maturity
thereof by reason of default; or
(e) Judgment. Any judgment or order for the payment of money in excess of
$50,000,000, in the aggregate, shall be rendered against the Borrower
and the Relevant Subsidiaries and there shall be any period of thirty
(30) consecutive days during which a stay of enforcement of such
judgment or order, by reason of a pending appeal or otherwise, shall
not be in effect; or
(f) Bankruptcy, Etc. The Borrower or any Relevant Subsidiary shall (i) apply
for or consent to the appointment of, or the taking of possession by, a
receiver, custodian, trustee or liquidator of itself or of all or a
substantial part of its property; (ii) make a general assignment for the
benefit of its creditors; (iii) commence a voluntary case under the U.S.
Bankruptcy Code (as now or hereafter in effect) or any similar law of any
applicable jurisdiction; (iv) file a petition seeking to take advantage of
any other law relating to bankruptcy, insolvency, reorganization,
winding-up, or composition or readjustment of debts; or (v) fail to
controvert in a timely and appropriate manner, or acquiesce in writing to,
any petition filed against it in an involuntary case under the U.S.
Bankruptcy Code or any similar law of any applicable jurisdiction; or a
proceeding or case shall be commenced, without the application or consent
of the Borrower or any of its Relevant Subsidiaries, in any court of
competent jurisdiction, seeking (A) its liquidation, reorganization,
dissolution or winding-up, or the composition or readjustment of its debts;
(B) the appointment of a trustee, receiver, custodian, liquidator or the
like of the Borrower or such Relevant Subsidiary (as applicable) or of all
or any substantial part of its assets; or (C) similar relief in respect of
the Borrower or such Relevant Subsidiary (as applicable) under any law
relating to bankruptcy, insolvency, reorganization, winding-up, or
composition or adjustment of debts, and such proceeding or case shall
continue unstayed and in effect for a period of ninety (90) or more days;
or
(g) Change of Control. Southern shall at any time cease to beneficially
own, directly or indirectly, (i) at least a majority of each of the
non-voting common stock (if any) and the voting common stock of the
Borrower; or (ii) sufficient shares of the capital stock of the
Borrower to elect a majority of the board of directors of the Borrower;
or
(h) Credit Agreement. Any material provision of this Agreement shall fail
to be in full force and effect, or the Borrower so asserts in writing;
then, and in any such event, the Agent (i) shall at the request, or may with the
consent, of the Majority Lenders, by notice to the Borrower, declare the
obligation of each Lender to make Advances or establish CP Commitments to be
terminated, whereupon the same shall forthwith terminate; and/or (ii) shall at
the request, or may with the consent, of the Majority Lenders, by notice to the
Borrower, declare the Advances and the Notes, all interest thereon and all other
amounts payable under this Agreement to be forthwith due and payable, whereupon
the Advances and the Notes, all such interest and all such amounts shall become
and be forthwith due and payable, without presentment, demand, protest or
further notice of any kind, all of which are hereby expressly waived by the
Borrower; provided that in the event of an actual or deemed entry of an order
for relief with respect to the Borrower under the Federal Bankruptcy Code, (A)
the obligation of each Lender to make Advances or establish CP Commitments shall
automatically be terminated; and (B) the Advances and the Notes, all such
interest and all such amounts shall automatically become and be due and payable,
without presentment, demand, protest or any notice of any kind, all of which are
hereby expressly waived by the Borrower.
Any Default or Event of Default which has been waived in the
manner required by the applicable provisions of this Agreement shall not be
considered to be continuing from and after the time as of which such waiver has
become effective.
Article VII
THE AGENT
SECTION 7.01. Authorization and Action. Each Lender hereby appoints and
authorizes the Agent to take such action as agent on its behalf and to exercise
such powers and discretion under this Agreement and the other Loan Documents as
are delegated to the Agent by their respective terms, together with such powers
and discretion as are reasonably incidental thereto and further authorizes the
Agent to execute that certain Letter Amendment No. 1 to Completion Guarantee and
that certain Letter Amendment No. 1 to Equity Contribution Agreement, each to be
dated as of the date hereof and each among the Borrower, Southern and the Agent.
As to any matters not expressly provided for by this Agreement or any other Loan
Document (including enforcement or collection of the Notes), the Agent shall not
be required to exercise any discretion or take any action, but shall be required
to act or to refrain from acting (and shall be fully protected in so acting or
refraining from acting) upon the instructions of the Majority Lenders, and such
instructions shall be binding upon all Lenders and all holders of Notes;
provided that the Agent shall not be required to take any action that exposes
the Agent to personal liability or that is contrary to this Agreement, the other
Loan Documents or applicable Law. The Agent agrees to give to each Lender prompt
notice of each notice given to it by any Loan Party pursuant to the terms of the
relevant Loan Document.
SECTION 7.02. Agent's Reliance, Etc. Neither the Agent nor any of its directors,
officers, agents or employees shall be liable for any action taken or omitted to
be taken by it or them under or in connection with this Agreement or any other
Loan Document, except for its or their own gross negligence or willful
misconduct. Without limitation to the generality of the foregoing, the Agent:
(a) may treat the payee of any Note as the holder thereof until the Agent
receives and accepts an Assignment and Acceptance entered into by the Lender
that is the payee of such Note, as assignor, and an Eligible Assignee, as
assignee, as provided in Section 8.07; (b) may consult with legal counsel
(including counsel for the Borrower), independent public accountants and other
experts selected by it and shall not be liable for any action taken or omitted
to be taken in good faith by it in accordance with the advice of such counsel,
accountants or experts; (c) makes no warranty or representation to any Lender
and shall not be responsible to any Lender for any statements, warranties or
representations (whether written or oral) made in or in connection with this
Agreement, any other Loan Document or any PPA Document; (d) shall not have any
duty to ascertain or to inquire as to the performance or observance of any of
the terms, covenants or conditions of this Agreement or any other Material
Document on the part of the Borrower or Southern or any other party thereto, or
to inspect the property (including the books and records) of the Borrower or
Southern; (e) shall not be responsible to any Lender for the due execution,
legality, validity, enforceability, genuineness, sufficiency or value of this
Agreement or any other Material Document or any other instrument or document
furnished pursuant hereto or thereto; and (f) shall incur no liability under or
in respect of this Agreement or any other Loan Document by acting upon any
notice, consent, certificate or other instrument or writing (which may be by
telecopier, telegram or telex) believed by it to be genuine and signed or sent
by the proper party or parties.
SECTION 7.03. Citibank and Affiliates. With respect to its Commitment, the
Advances made by it and the Note issued to it, Citibank shall have the same
rights and powers under this Agreement as any other Lender and may exercise such
rights and powers as though it were not the Agent; and the term "Lender" or
"Lenders" shall, unless otherwise expressly indicated, include Citibank in its
individual capacity. Citibank and its Affiliates may accept deposits from, lend
money to, act as trustee under indentures of, accept investment banking
engagements from, and generally engage in any kind of business with, the
Borrower, Southern, any of their respective Subsidiaries and any Person who may
do business with, or own securities of, the Borrower, Southern or any such
Subsidiary, all as if Citibank were not the Agent and without any duty to
account therefor to the Lenders.
SECTION 7.04. Lender Credit Decision. Each Lender acknowledges that it has,
independently and without reliance upon the Agent, any Arranger or any other
Lender and based on the financial statements referred to in Section 4.01 and
such other documents and information as it has deemed appropriate, made its own
credit analysis and decision to enter into this Agreement and the other Loan
Documents. Each Lender also acknowledges that it will, independently and without
reliance upon the Agent, any Arranger or any other Lender and based on such
documents and information as it shall deem appropriate at the time, continue to
make its own credit decisions in taking or not taking action under this
Agreement or any other Loan Document.
SECTION 7.05. Indemnification. The Lenders agree to indemnify the Agent (to the
extent not reimbursed by the Borrower), ratably according to the respective
principal amounts of the Notes then held by each of them (or if no Notes are at
the time outstanding or if any Notes are held by Persons that are not Lenders,
ratably according to the respective amounts of their Commitments), from and
against any and all liabilities, obligations, losses, damages, penalties,
actions, judgments, suits, costs, expenses or disbursements of any kind or
nature whatsoever that may be imposed on, incurred by, or asserted against the
Agent in any way relating to or arising out of this Agreement or any other Loan
Document or any action taken or omitted by the Agent under this Agreement or any
other Loan Document (collectively, the "Indemnified Costs"); provided that no
Lender shall be liable for any portion of the Indemnified Costs resulting from
the Agent's gross negligence or willful misconduct; provided further that no
Designated Lender shall be liable for any payment under this Section 7.05 so
long as, and to the extent that, its Designating Lender makes such payment.
Without limitation to the generality of the foregoing, each Lender agrees to
reimburse the Agent promptly upon demand for its ratable share of any
out-of-pocket expenses (including counsel fees) incurred by the Agent in
connection with the preparation, execution, delivery, administration,
modification, amendment or enforcement (whether through negotiations, legal
proceedings or otherwise) of, or legal advice in respect of rights or
responsibilities under, this Agreement, any other Material Document or any other
instrument or agreement furnished pursuant hereto or thereto, to the extent that
the Agent is not reimbursed for such expenses by the Borrower. In the case of
any investigation, litigation or proceeding giving rise to any Indemnified
Costs, this Section 7.05 applies whether any such investigation, litigation or
proceeding is brought by the Agent, any Lender or a third party.
SECTION 7.06. Successor Agent. The Agent may resign at any time by giving
written notice thereof to the Lenders and the Borrower and may be removed at any
time with or without cause by the Majority Lenders. Upon any such resignation or
removal, the Borrower shall have the right to appoint a successor Agent, subject
to the approval of the Majority Lenders, such approval not to be unreasonably
withheld or delayed. If no successor Agent shall have been so appointed by the
Borrower and approved by the Majority Lenders, and shall have accepted such
appointment, within thirty (30) days after the retiring Agent's giving of notice
of resignation or the Majority Lenders' removal of the retiring Agent, then the
retiring Agent may, on behalf of the Lenders, appoint a successor Agent subject
to the approval of the Borrower and the Majority Lenders, such approval not to
be unreasonably withheld or delayed, which shall be a commercial bank organized
under the laws of the United States or of any State thereof and having a
combined capital and surplus of at least $500,000,000. Upon the acceptance of
any appointment as Agent under this Section 7.06 by a successor Agent, such
successor Agent shall thereupon succeed to and become vested with all the
rights, powers, discretion, privileges and duties of the retiring Agent, and the
retiring Agent shall be discharged from its duties and obligations under this
Agreement and the other Loan Documents. After any retiring Agent's resignation
or removal under this Section 7.06 as Agent, the provisions of this Article VII
shall inure to its benefit as to any actions taken or omitted to be taken by it
while it was Agent under this Agreement and the other Loan Documents.
Article VIII
MISCELLANEOUS
SECTION 8.01. Amendments, Etc. No amendment or waiver of any provision of this
Agreement, the Notes or any other Loan Document, nor consent to any departure by
the Borrower or Southern therefrom, shall in any event be effective unless the
same shall be in writing and signed by or on behalf of the Borrower (and, in the
case only of the Southern Completion Guarantee and the Southern Equity
Agreement, Southern) and the Majority Lenders, and then such waiver or consent
shall be effective only in the specific instance and for the specific purpose
for which given; provided that:
(a) no amendment, waiver or consent shall, unless in writing and signed by or
on behalf of the Borrower (and, in the case only of the Southern Completion
Guarantee and the Southern Equity Agreement, Southern) and all the Lenders,
do any of the following: (i) increase the Commitments of the Lenders or
subject the Lenders to any additional obligations; (ii) reduce the
principal of, or interest on, the Notes or any fees payable under this
Agreement or the other Loan Documents; (iii) postpone any date fixed for,
or change the place or currency of, any payment of principal of, or
interest on, the Notes or any fees payable under this Agreement or the
other Loan Documents; (iv) change the percentage of the Commitments or of
the aggregate unpaid principal amount of the Notes, or the number of
Lenders, that shall be required for the Lenders or any of them to take any
action under this Agreement or any other Loan Document; (v) amend the
definition of "Majority Lenders" or "Required Lenders"; or (vi) amend this
Section 8.01;
(b) no amendment or waiver of any of the conditions specified in Section
3.04, 3.06(a) or 3.06(d) shall be effective unless in writing and
signed by or on behalf of the Borrower and the Required Lenders;
(c) no amendment (other than an amendment to extend its provisions, in
accordance with the terms thereof, to a Subsequent Project), waiver or
consent shall, unless in writing and signed by or on behalf of the
Borrower, Southern and the Required Lenders (or, all of the Lenders
with respect to any matters relating to those matters expressly
referred to in subsection (a) above), be made to or given under the
Southern Completion Guarantee or the Southern Equity Agreement; and
(d) no amendment, waiver or consent shall, unless in writing and signed by
or on behalf of the Agent in addition to the Persons required pursuant
to subsection (a), (b) or (c) above, as the case may be, to take such
action, affect the rights or duties of the Agent under this Agreement,
any Note or any other Loan Document.
Each Designating Lender may act on behalf of its Designated Lender with respect
to any rights of its Designated Lender to grant or withhold any amendment,
waiver or consent under this Agreement and the other Loan Documents or with
respect to the Notes.
SECTION 8.02. Notices, Etc. All notices and other communications provided
for under this Agreement shall be in writing (including
telecopier) and mailed, telecopied, or delivered,
(a) if to the Borrower, at its address at 270 Peachtree Street NW, Suite
2000, Atlanta, GA 30303, Attention: Allen Leverett, Treasurer,
facsimile: (404) 506-0708; with a copy to Chris J. Kysar, Southern
Power Company, 270 Peachtree Street NW, Suite 2000, Atlanta, GA 30303,
facsimile: (404) 506-0708, and Richard H. Brody, Troutman Sanders LLP,
Bank of America Plaza, Suite 5200, 600 Peachtree Street NE, Atlanta, GA
30308, facsimile: (404) 962-6514;
(b) if to an Initial Lender, at its Domestic Lending Office specified
opposite its name on Schedule I;
(c) if to any other Lender, at its Domestic Lending Office specified in the
Assignment and Acceptance pursuant to which it became a Lender;
(d) if to any Designated Lender, to its Designating Lender in accordance
with subsection (c) above; and
(e) if to the Agent, at its address at 2 Penns Way, Suite 200, New Castle,
DE 19720, Attention: Dave Graber, telephone: (302) 894-6034, facsimile:
(302) 894-6120; with a copy to Citibank, N.A., 388 Greenwich Street,
20th Floor, New York, NY 10013, Attention: John Maguire, telephone:
(212) 816-1081, facsimile: (212) 816-0584;
or, as to the Borrower or the Agent, at such other address as shall be
designated by such party in a written notice to the other parties and, as to
each other party, at such other address as shall be designated by such party in
a written notice to the Borrower and the Agent. All such notices and
communications shall, when mailed or telecopied, be effective when deposited in
the mails or telecopied, respectively, except that notices and communications to
the Agent pursuant to Article II, III or VII shall not be effective until
received by the Agent. Delivery by telecopier of an executed counterpart of this
Agreement or of any amendment or waiver of any provision of this Agreement or
the Notes or any other Loan Document or of any Exhibit to be executed and
delivered under this Agreement shall be effective as delivery of a manually
executed counterpart thereof.
SECTION 8.03. No Waiver; Remedies. No failure on the part of any Lender or the
Agent to exercise, and no delay in exercising, any right under this Agreement or
under any Note shall operate as a waiver thereof; nor shall any single or
partial exercise of any such right preclude any other or further exercise
thereof or the exercise of any other right. The remedies provided under this
Agreement are cumulative and not exclusive of any remedies provided by Law.
SECTION 8.04. Costs and Expenses, Etc. (a) The Borrower agrees to pay, upon
demand and presentation to the Borrower of a statement of account, all
reasonable and documented third-party out-of-pocket costs and expenses of the
Agent in connection with the preparation, execution, delivery, syndication,
administration, modification and amendment of this Agreement, the Notes, the
other Loan Documents and the other documents to be delivered hereunder or
thereunder (including (i) all costs and expenses in connection with due
diligence and syndication (including printing, travel, communication, document
preparation, printing and distribution and bank meetings); (ii) the reasonable
fees and expenses of each of New York special counsel and regulatory counsel for
the Agent (but excluding the Agent's in-house counsel) with respect thereto and
with respect to advising the Agent as to its rights and responsibilities under
this Agreement and the other Loan Documents; and (iii) the fees and expenses of
each of the Independent Engineer and Environmental Consultant, the Independent
Insurance Consultant and the Independent Market Consultant). The Borrower
further agrees to pay, upon demand and presentation to the Borrower of a
statement of account, all reasonable and documented third-party out-of-pocket
costs and expenses of the Agent and the Lenders, if any (including, without
limitation, reasonable fees and expenses of counsel), in connection with the
enforcement (whether through negotiations, legal proceedings or otherwise) of
this Agreement, the Notes, the other Loan Documents and the other documents to
be delivered hereunder and thereunder, including reasonable fees and expenses of
counsel for the Agent and the Lenders in connection with the enforcement of
rights under this Section 8.04(a); provided that the Borrower shall be required
to pay the reasonable fees and expenses of only one special counsel and, if
applicable, one regulatory counsel selected by the Indemnified Parties under the
circumstances contemplated by the proviso to Section 8.04(b)(iii).
(b) (i) The Borrower agrees to indemnify each of the Arrangers, the Agent, the
Lenders and their respective Affiliates, officers, directors, employees and
agents (each, an "Indemnified Party") from, and hold each of them harmless
against, any and all losses, liabilities, claims, damages and expenses incurred
by any of them relating to, or arising out of or in connection with, this
Agreement, the Notes, the other Loan Documents and the actual or proposed use of
the proceeds of the Advances or the consummation of any matter contemplated by
this Agreement or the other Loan Documents, including any investigation,
litigation or other proceeding (whether or not any of the Indemnified Parties is
a party thereto) related to the entering into of any Loan Document and, to the
extent provided in this subsection (b), the reasonable fees and disbursements of
counsel incurred in connection with any such claim, investigation, litigation or
other proceeding; provided that the Borrower shall not be responsible for any
such losses, liabilities, claims, damages or expenses of any Indemnified Party
to the extent incurred by reason of gross negligence or willful misconduct on
the part of such Indemnified Party.
(ii) The Borrower shall be entitled to participate in any action or proceeding
of which it has been notified by any Indemnified Party except any action or
proceeding brought by or for the benefit of the Borrower, Southern or any
Subsidiary of the Borrower or Southern against an Indemnified Party.
(iii) Promptly after receipt by an Indemnified Party of written notice of any
investigation, litigation or proceeding in respect of which indemnity is sought
by it under this Agreement, such Indemnified Party will, if a claim is to be
made against the Borrower, notify the Borrower thereof in writing, but the
omission so to notify the Borrower will not relieve the Borrower from (A) any
liability under this Section which it may have to such Indemnified Party except
to the extent the Borrower was prejudiced by such omission; or (B) any liability
other than under this Section. Thereafter, the Indemnified Party and the
Borrower shall consult, to the extent appropriate, with a view to minimizing the
cost to the Borrower of its obligations under this Agreement. In case any
Indemnified Party receives written notice of any investigation, litigation or
proceeding in respect of which indemnity may be sought by it under this
Agreement and it notifies the Borrower thereof, the Borrower will be entitled to
participate therein, and to the extent that it may elect by written notice
delivered to the Indemnified Party promptly after receiving the aforesaid notice
from the Indemnified Party, to assume the defense thereof with counsel
reasonably satisfactory to the Indemnified Parties (and, if the Agent or one or
more Lenders are the Indemnified Parties, the Agent and such Lenders shall be
entitled jointly to direct the conduct of their defense); provided that if the
parties against which any loss, claim, damage, expense or liability may arise
under any such investigation, litigation or proceeding include both an
Indemnified Party and the Borrower, Southern or any Subsidiary of the Borrower
or Southern, and such Indemnified Party shall have reasonably concluded that (1)
there may be legal defenses available to it or other Indemnified Parties which
are different from or additional to those available to the Borrower, Southern or
any Subsidiary of the Borrower or Southern, and may conflict therewith; or (2)
if any liability, loss, claim, damage or expense arises out of actions brought
by or for the benefit of the Borrower, Southern or any Subsidiary of the
Borrower or Southern, the Indemnified Parties collectively shall have the right
to select one separate counsel to assume such legal defenses and otherwise to
participate in the defense of such investigation, litigation or proceeding on
behalf of the Indemnified Parties. Upon receipt by the Indemnified Party of
notice from the Borrower of its election to assume the defense of such
investigation, litigation or proceeding and approval by the Indemnified Party of
counsel, the Borrower shall not be liable to the Indemnified Party for any legal
or other expenses subsequently incurred by the Indemnified Party in connection
with the defense thereof unless (x) the Indemnified Party shall have employed
such counsel in connection with the assumption of legal defenses in accordance
with the proviso to the preceding sentence; (y) the Borrower shall not have
employed and continued to employ counsel reasonably satisfactory to the
Indemnified Party to represent the Indemnified Party within a reasonable time
after notice of commencement of the action; or (z) the Borrower shall have
authorized in writing the employment of separate counsel for the Indemnified
Party at the expense of the Borrower. At the Borrower's request, an Indemnified
Party will settle, compromise or consent to the entry of any order adjudicating
or otherwise disposing of any loss, claim, damage or liability resulting from
such investigation, litigation or proceeding for which the Borrower is liable
under this Agreement if such settlement, compromise or consent to entry of any
order (AA) includes a provision unconditionally releasing each Indemnified Party
from and holding each Indemnified Party harmless against all liability in
respect of claims by any releasing party relating to or arising out of this
Agreement, the Notes and the matters contemplated herein; (BB) does not require
any admission or acknowledgment of culpability or wrongdoing by such Indemnified
Party; and (CC) does not involve performance by, or the payment of money damages
or posting any collateral or bond by, such Indemnified Party. The Borrower shall
not be liable for any settlement, compromise or consent to the entry of any
order adjudicating or otherwise disposing of any investigation, litigation or
proceeding effected without its consent.
(c) The Borrower agrees to indemnify each Lender for its actual and documented
(to the extent practicable) losses (excluding any loss of profit and/or margin),
costs and expenses reasonably incurred by it resulting from any payment or
prepayment of principal of, or Conversion of, any Eurodollar Rate Advance which
is made on a day other than the last day of the relevant Interest Period or in
an amount other than given in the Borrower's notice of such payment or
prepayment, excluding, however, any such losses, costs and expenses resulting
from a payment or prepayment made more than ninety (90) days prior to demand
being made to the Borrower by such Lender for indemnification. The payment of
such indemnity to a Lender shall be made within thirty (30) days of a demand by
such Lender complying with Section 8.04(d).
(d) Any demand by a Lender for payment under Section 2.02(c), 2.10, 2.13,
8.04(b) or 8.04(c) or under any other indemnity made by the Borrower under this
Agreement shall be made in writing to the Borrower (with a copy to the Agent)
and shall be accompanied by a certificate of an officer of the Agent or the
relevant Lender, as may be appropriate, setting forth in reasonable detail the
calculation of the amount demanded.
(e) To the extent permitted by Law, if any Lender notifies the Borrower that
additional amounts will be due under Section 2.10 or that any of the events
outlined in Section 2.11 have occurred, such Lender will, if it determines that
such change is not commercially unreasonable, change its Applicable Lending
Office if as a result of such change such increased costs would not be required
to be so paid or it would not be illegal for such Lender to make, fund or
maintain its Eurodollar Rate Advances. The Borrower will reimburse such Lender
for all reasonable expenses it may incur as a result of complying with this
Section 8.04(e).
(f) If any circumstances arise which result, or such Lender becomes aware of any
circumstances which might result, in the Borrower having to make such
compensation or indemnification or in it becoming illegal for such Lender to
make, fund or maintain such Lender's Eurodollar Rate Advances, such Lender will
promptly notify the Borrower thereof and, in consultation with the Borrower,
such Lender shall take all such steps, if any, as it determines are reasonable
and the Borrower determines are acceptable to mitigate the effect of those
circumstances.
(g) Without prejudice to the survival of any other agreement of the Borrower or
of the Lenders under this Agreement, the agreements and obligations of the
Borrower contained in Sections 2.10, 2.13 and 8.04 and the obligations of the
Lenders contained in Sections 2.13, 8.04, 8.07(g) and 8.08 shall survive the
payment in full of principal, interest and all other amounts payable under this
Agreement and under the Notes.
SECTION 8.05. Right of Set-off. Upon declaration by the Agent that the Advances
and the Notes are due and payable pursuant to the provisions of Section 6.01,
each Lender is hereby authorized at any time and from time to time, to the
fullest extent permitted by Law, to set off and apply any and all deposits
(general or special, time or demand, provisional or final) at any time held by
such Lender to, or for the credit or the account of, the Borrower against any
and all of the obligations of the Borrower now or hereafter existing under this
Agreement, the Notes held by such Lender and the other Loan Documents, whether
or not such Lender shall have made any demand under this Agreement, such Notes
or any other Loan Document and although such obligations may be unmatured. Each
Lender agrees promptly to notify the Borrower after any such set-off and
application; provided that the failure to give such notice shall not affect the
validity of such set-off and application. The rights of each Lender under this
Section are in addition to other rights and remedies (including other rights of
set-off) that such Lender may have.
SECTION 8.06. Binding Effect. This Agreement shall become effective (other than
Section 2.01 and 2.15, each of which shall only become effective upon
satisfaction of the conditions precedent set forth in Section 3.01) when it
shall have been executed by the Borrower and the Agent and when the Agent shall
have been notified by the Initial Lenders that such Initial Lenders have
executed it and thereafter shall be binding upon and inure to the benefit of the
Borrower, the Agent and each Lender and their respective successors and assigns,
except that the Borrower shall not have the right to assign its rights hereunder
or any interest herein without the prior written consent of the Lenders.
SECTION 8.07. Assignments and Participations. (a) Each Lender may assign to (i)
one or more Eligible Assignees without the approval of the Borrower or the Agent
in the case of any Eligible Assignee that is already a Lender or an Affiliate of
a Lender, and with the approval of the Borrower (unless an Event of Default or
Default has occurred and is then continuing) and the Agent, in the case of any
other Eligible Assignee (such approval not to be unreasonably withheld or
delayed); and (ii) one or more other entities with the approval of the Agent
and, so long as no Event of Default exists, the Borrower, all or a portion of
its rights and obligations under this Agreement (including all or a portion of
its Commitment, the Advances owing to it and the Note or Notes held by it);
provided that (A) each such assignment shall be of a pro rata share of each
outstanding Advance made by such Lender and the Commitment and CP Commitment of
such Lender; (B) each such assignment shall be of a constant, and not a varying,
percentage of all rights and obligations under this Agreement; (C) except in the
case of an assignment to a Person that, immediately prior to such assignment,
was a Lender or an assignment of all of a Lender's rights and obligations under
this Agreement, the amount of the Commitment of the assigning Lender being
assigned pursuant to each such assignment (determined as of the date of the
Assignment and Acceptance with respect to such assignment) shall be $10,000,000
or a larger integral multiple of $1,000,000; and (D) the parties to each such
assignment shall execute and deliver to the Agent, for recording in the
Register, and, if the relevant assignee is not a Lender or an Affiliate of a
Lender, to each of the Agent and the Borrower for its acceptance (provided that
no such acceptance is required (1) from the Borrower or the Agent with respect
to an assignee that is a Lender or an Affiliate of a Lender; or (2) from the
Borrower with respect to any other Eligible Assignee while an Event of Default
or Default has occurred and is continuing), an appropriate Assignment and
Acceptance, together with any Note subject to such assignment and a processing
and recordation fee of $3,000 (which shall not be payable by the Borrower). Upon
such execution, delivery, acceptance (if applicable) and recording, from and
after the effective date specified in each Assignment and Acceptance, (x) the
assignee thereunder shall be a party to this Agreement and, to the extent that
rights and obligations under this Agreement have been assigned to it pursuant to
such Assignment and Acceptance, have the rights and obligations of a Lender
under this Agreement; and (y) the Lender assignor thereunder shall, to the
extent that rights and obligations under this Agreement have been assigned by it
pursuant to such Assignment and Acceptance, relinquish its rights and be
released from its obligations under this Agreement (other than under Sections
2.13(f), 8.07(g) and 8.08) (and, in the case of an Assignment and Acceptance
covering all or the remaining portion of an assigning Lender's rights and
obligations under this Agreement, such Lender shall cease to be a party to this
Agreement).
(b) If any Lender shall make a demand under Section 8.04(d) for payment in
respect of a claim under Section 2.10 or shall give a notice under Section 2.11
of any unlawfulness or assertion of unlawfulness contemplated by such Section or
any demand shall be made or any amount shall be payable with respect to any
Lender under Section 2.13, the Borrower may, by written notice given to such
Lender within forty-five (45) days of the making by such Lender of such demand
or the giving by such Lender of such notice, require by written notice to such
Lender that such Lender assign, by executing and delivering an Acceptance and
Assignment with such Person as directed by the Borrower (it being understood
that such Lender shall not be obligated to find an assignee), within fifteen
(15) days of the giving by the Borrower of such notice but on at least three (3)
Business Days' notice to one or more Persons in accordance with Section 8.07(a)
such Lender's Commitment and its Advances against payment to such Lender in
immediately available funds of the principal amount of such Advances, all
interest accrued thereon to the date of payment, all fees accrued by such Lender
to the date of payment, any amounts payable to such Lender under Section 8.04(c)
and all other amounts payable hereunder to such Lender.
(c) By executing and delivering an Assignment and Acceptance, the Lender
assignor thereunder and the assignee thereunder confirm to and agree with each
other and the other parties to this Agreement as follows: (i) other than as
provided in such Assignment and Acceptance, such assigning Lender makes no
representation or warranty and assumes no responsibility with respect to any
statements, warranties or representations made in or in connection with this
Agreement or any other Material Document or the execution, legality, validity,
enforceability, genuineness, sufficiency or value of this Agreement or any other
Material Document or any other instrument or document furnished pursuant hereto
or thereto; (ii) such assigning Lender makes no representation or warranty and
assumes no responsibility with respect to the financial condition of the
Borrower, Southern or any Subsidiary of the Borrower or Southern, or the
performance or observance by the Borrower or Southern or any other party of any
of its obligations under any Material Document to which it is a party or any
other instrument or document furnished pursuant thereto; (iii) such assignee
confirms that it has received a copy of this Agreement, together with copies of
the financial statements referred to in Section 4.01 and such other documents
and information as it has deemed appropriate to make its own credit analysis and
decision to enter into such Assignment and Acceptance; (iv) such assignee will,
independently and without reliance upon the Agent, such assigning Lender or any
other Lender and based on such documents and information as it shall deem
appropriate at the time, continue to make its own credit decisions in taking or
not taking action under this Agreement and the other Loan Documents; (v) such
assignee confirms that it is an Eligible Assignee or that it is an entity that
has been approved by the Borrower and the Agent to the extent any such approval
is required under Section 8.07(a); (vi) such assignee appoints and authorizes
the Agent to take such action as agent on its behalf and to exercise such powers
and discretion under this Agreement and the other Loan Documents as are
delegated to the Agent by the terms hereof and thereof, together with such
powers and discretion as are reasonably incidental thereto; and (vii) such
assignee agrees that it will perform in accordance with their terms all of the
obligations that by the terms of this Agreement and the other Loan Documents are
required to be performed by it as a Lender.
(d) The Agent shall maintain at its address referred to in Section 8.02 a copy
of each Assignment and Acceptance and each Designation Agreement delivered to
and (if applicable) accepted by it and a register for the recordation of the
names and addresses of the Lenders and the Commitment of, and principal amount
of the Advances owing to, each Lender from time to time (the "Register"). The
entries in the Register shall be conclusive and binding for all purposes, absent
manifest error, and the Borrower, the Agent and the Lenders may treat each
Person whose name is recorded in the Register as a Lender under this Agreement
for all purposes of this Agreement. The Register shall be available for
inspection by the Borrower or any Lender at any reasonable time and from time to
time upon reasonable prior notice.
(e) Upon its receipt of an Assignment and Acceptance executed by an assigning
Lender and an assignee representing that it is an existing Lender or Affiliate
of a Lender or that it is an entity that has been approved by the Borrower and
the Agent under Section 8.07(a), together with any Note or Notes subject to such
assignment, the Agent shall, if such Assignment and Acceptance has been
completed and is in substantially the form of Exhibit C, (i) accept such
Assignment and Acceptance; (ii) record the information contained therein in the
Register; and (iii) promptly give notice and a copy thereof to the Borrower.
Within five (5) Business Days after its receipt of such notice, the Borrower, at
its own expense, shall execute and deliver to the Agent in exchange for the
surrendered Note a new Note to such Eligible Assignee or other entity in an
amount equal to the Commitment assumed by it pursuant to such Assignment and
Acceptance and, if the assigning Lender has retained a Commitment under this
Agreement, a new Note to the assigning Lender in an amount equal to the
Commitment retained by it under this Agreement. Such new Note or Notes shall be
in an aggregate principal amount equal to the aggregate principal amount of such
surrendered Note or Notes, shall be dated the effective date of such Assignment
and Acceptance and shall otherwise be in substantially the form of Exhibit A.
(f) Each Lender may sell participations to one or more banks or other entities
(other than the Borrower or any of its Affiliates) in or to all or a portion of
its rights and/or obligations under this Agreement (including all or a portion
of its Commitment, the Advances owing to it and/or the Note or Notes held by
it); provided that (i) such Lender's obligations under this Agreement and the
other Loan Documents (including its Commitment) shall remain unchanged; (ii)
such Lender shall remain solely responsible to the other parties to this
Agreement and the other Loan Documents for the performance of such obligations;
(iii) such Lender shall remain the holder of any such Note for all purposes of
this Agreement and the other Loan Documents; (iv) the Borrower, the Agent and
the other Lenders shall continue to deal solely and directly with such Lender in
connection with such Lender's rights and obligations under this Agreement and
the other Loan Documents; and (v) no participant under any such participation
shall have any right to approve any amendment or waiver of any provision of this
Agreement, any Note or any other Loan Document, or any consent to any departure
by the Borrower or Southern therefrom, except to the extent that such amendment,
waiver or consent would reduce the principal of, or interest on, the Notes or
any fees or other amounts payable under this Agreement, the Notes or any other
Loan Document, or postpone any date fixed for any payment of principal of, or
interest on, the Notes or any fees or other amounts payable under this
Agreement, the Notes or any other Loan Document, in each case to the extent
subject to such participation, or any other matter for which unanimous consent
of the Lenders is required pursuant to this Agreement or any other Loan
Document.
(g) Any Lender may, in connection with any assignment or participation or
proposed assignment or participation pursuant to this Section 8.07, disclose to
the assignee or participant or proposed assignee or participant, any
Confidential Information; provided that prior to any such disclosure, the
assignee or participant or proposed assignee or participant shall (if it is not
an existing Lender or Participant) have executed and delivered to such Lender
and to the Borrower a duly authorized confidentiality agreement containing
provisions substantially the same as those of Section 8.08.
(h) Notwithstanding any other provision set forth in this Agreement, any Lender
may at any time create a security interest in all or any portion of its rights
under this Agreement (including the Advances owing to it and the Note held by
it) in favor of any Federal Reserve Bank in accordance with Regulation A of the
Board of Governors of the Federal Reserve System.
(i) Any Lender may at any time, without the consent of the Borrower, designate
not more than one Designated Lender to fund Advances on behalf of such
Designating Lender subject to the terms of this Section 8.07(i), and the
provisions of Sections 8.07(a) through (h) shall not apply to such designation.
No Lender may have more than one Designated Lender at any time. Such designation
may occur either by the execution before the Funds Availability Date of the
signature pages of an Assignment and Acceptance by such Lender and Designated
Lender next to the appropriate "Designating Lender" and "Designated Lender"
captions, or by execution by such parties of a Designation Agreement on or after
the Funds Availability Date; provided that any Lender and its Designated Lender
executing the signature pages of any Assignment and Acceptance as "Designating
Lender" and "Designated Lender", respectively, before the Funds Availability
Date shall be deemed to have executed a Designation Agreement, and shall be
bound by the respective representations, warranties and covenants contained
therein. The parties to each such designation occurring on or after the Funds
Availability Date shall execute and deliver to the Agent and the Borrower a
Designation Agreement. Upon receipt of an appropriately completed Designation
Agreement executed by a Designating Lender and a designee representing that it
is a Designated Lender, the Agent will accept such Designation Agreement and
will give prompt notice thereof to the Borrower and the other Lenders, whereupon
(i) the Borrower shall execute and deliver to the Designating Lender a
Designated Lender Note payable to the order of the Designated Lender; (ii) from
and after the effective date specified in the Designation Agreement, the
Designated Lender shall become a party to this Agreement with a right to make
Advances on behalf of its Designating Lender pursuant to Section 2.01(c); and
(iii) the Designated Lender shall not be required to make payments with respect
to any obligations in this Agreement except to the extent of excess cash flow of
such Designated Lender which is not otherwise required to repay obligations of
such Designated Lender which are then due and payable; provided that regardless
of such designation and assumption by the Designated Lender, the Designating
Lender shall be and remain obligated to the Borrower, the Agent and the Lenders
for each and every of the obligations of the Designating Lender and its related
Designated Lender with respect to this Agreement and the other Loan Documents,
including any indemnification obligations under Section 7.05, and any sums
otherwise payable to the Borrower by the Designated Lender. Each Designating
Lender, or specified branch or affiliate thereof, shall serve as the
administrative agent of its Designated Lender and shall on behalf of its
Designated Lender: (A) receive any and all payments made for the benefit of such
Designated Lender; and (B) give and receive all communications and notices and
take all actions under this Agreement and the other Loan Documents, including
votes, approvals, waivers, consents and amendments under or relating to this
Agreement and the other Loan Documents. Any such notice, communication, vote,
approval, waiver, consent or amendment shall be signed by a Designating Lender,
or specified branch or affiliate thereof, as administrative agent for its
Designated Lender and need not be signed by such Designated Lender on its own
behalf. The Borrower, the Agent and the Lenders may rely thereon without any
requirement that the Designated Lender sign or acknowledge the same. No
Designated Lender may assign or transfer all or any portion of its interest
under this Agreement, other than via an assignment to its Designating Lender or
Liquidity Lender, if any, or otherwise in accordance with the provisions of
Sections 8.07(a) through (h).
(j) Notwithstanding anything in this Agreement to the contrary (including any
other provision regarding assignments, participations, transfers or novations),
any Lender (a "Granting Lender") may, without the consent of any other party
hereto, grant to a special purpose vehicle (whether a corporation, partnership,
limited liability company, trust or otherwise, an "SPV") sponsored or managed by
the Granting Lender or any Affiliate thereof, a participation in all or any part
of any existing or future Advances hereunder (including Commitments therefor)
that such Granting Lender has made or will make pursuant to this Agreement;
provided that (i) such Granting Lender's obligations under this Agreement
(including its Commitments) shall remain unchanged; (ii) such Granting Lender
shall remain the holder of the Notes for all purposes under this Agreement; and
(iii) the Borrower, Agent and other Lenders shall continue to deal solely and
directly with such Granting Lender in connection with such Granting Lender's
rights and obligations under this Agreement. Each party hereto hereby agrees
that (A) no SPV will be entitled to any rights or benefits that a Participant
would not otherwise be entitled to under this Agreement; and (B) an SPV may
assign its interest in any existing or future Advances under this Agreement to
any Person that would constitute a Participant. Notwithstanding anything in this
Agreement to the contrary, the Granting Lender and any SPV may, without the
consent of any other party to this Agreement, and without limiting any other
rights of disclosure of the Granting Lender under this Agreement, disclose on a
confidential basis any non-public information relating to its funding of
Advances to (1) (in the case of the Granting Lender) any actual or prospective
SPV, (2) (in the case of an SPV) its lenders, sureties, reinsurers, guarantors
or credit liquidity enhancers, (3) their respective directors, officers, and
advisors, and (4) any rating agency.
SECTION 8.08. Confidentiality. (a) Neither the Agent, any Arranger nor any
Lender may, without the prior written consent of the Borrower, disclose to any
Person (i) any confidential, proprietary or non-public information of the
Borrower furnished to the Agent, the Arrangers or the Lenders by the Borrower
(such information being referred to collectively herein as the "Confidential
Information") or (ii) the fact that the Confidential Information has been made
available or any of the terms, conditions or other facts with respect to the
Confidential Information, in each case except as permitted by Section 8.07(d) or
(g) or this Section 8.08 and except that each of the Agent, each of the
Arrangers and each of the Lenders may disclose Confidential Information (i) to
its and its Affiliates' employees, officers, directors, agents and advisors
(collectively, "Representatives") who need to know the Confidential Information
for the purpose of administering or enforcing its rights under this Agreement
and the other Loan Documents and the transactions contemplated hereby and
thereby or for the discharge of their duties (it being understood that the
Representatives to whom such disclosure is made will be informed of the
confidential nature of such Confidential Information and instructed to keep such
Confidential Information confidential on substantially the same terms as
provided herein), (ii) to the extent requested by any regulatory authority
having jurisdiction over it or to the extent necessary for purposes of enforcing
this Agreement or any other Loan Document, (iii) to the extent required by
applicable laws or regulations or by any subpoena or similar legal process, (iv)
to any other party to this Agreement, (v) in connection with the exercise of any
remedies hereunder or under any other Loan Document or any suit, action or
proceeding relating to this Agreement or any other Loan Document or the
enforcement of rights hereunder or thereunder, (vi) subject to an agreement
containing provisions substantially the same as those of this Section 8.08, to
any assignee of or Participant in, or any prospective assignee of or Participant
in, any of its rights or obligations under this Agreement including, in the case
of any securitization or collateralization of, or other similar transaction
relating to, its Commitments by any Lender, disclosure to any necessary Person
in connection with such securitization, collateralization or other transaction
(including any funding vehicle organized to undertake or effectuate such
securitization, collateralization or other transaction, its lenders, sureties,
reinsurers, swap counterparties, guarantors or credit liquidity enhancers, their
respective directors, officers, and advisors, and any rating agency) so long as
the Persons to whom such disclosure is made will be informed of the confidential
nature of such Confidential Information and such Persons have agreed in writing
(or with respect to any rating agency, in writing or otherwise) to keep such
Confidential Information confidential on substantially the same terms as
provided herein, and (vii) to the extent such Confidential Information (A) is or
becomes generally available to the public on a non-confidential basis other than
as a result of a breach of this Section 8.08 by the Agent, such Arranger or such
Lender, or (B) is or becomes available to the Agent, such Arranger or such
Lender on a nonconfidential basis from a source other than the Borrower and
(viii) with the consent of the Borrower.
(b) Neither the Agent, any Arranger nor any Lender shall, without the prior
written consent of the Borrower, use, either directly or indirectly, any of the
Confidential Information except in connection with this Agreement and the other
Loan Documents and the transactions contemplated hereby and thereby.
(c) Notwithstanding the foregoing, any of the parties hereto may disclose to any
and all persons, without limitation of any kind, the U.S. tax treatment and U.S.
tax structure of the transactions contemplated by this Agreement and the other
Loan Documents and all materials of any kind (including opinions or other tax
analyses) that are provided to such parties relating to such U.S. tax treatment
and U.S. tax structure.
(d) In the event that the Agent, any Arranger or any Lender becomes legally
compelled to disclose any of the Confidential Information otherwise than as
contemplated by Section 8.08(a), the Agent, such Arranger or such Lender shall
provide the Borrower with notice of such event promptly upon its obtaining
knowledge thereof (provided that it is not otherwise prohibited by Law from
giving such notice) so that the Borrower may seek a protective order or other
appropriate remedy. In the event that such protective order or other remedy is
not obtained, the Agent, such Arranger or such Lender shall furnish only that
portion of the Confidential Information that it is legally required to furnish
and shall cooperate with the Borrower's counsel to enable the Borrower to obtain
a protective order or other reliable assurance that confidential treatment will
be accorded the Confidential Information.
(e) In the event of any breach of this Section 8.08, the Borrower shall be
entitled to equitable relief (including injunction and specific performance) in
addition to all other remedies available to it at Law or in equity.
(f) Neither the Agent, any Arranger nor any Lender shall make any public
announcement, advertisement, statement or communication regarding the Borrower,
its Affiliates (insofar as such announcement, advertisement, statement or
communication relates to the Borrower or the transactions contemplated hereby)
or this Agreement or the transactions contemplated hereby without the prior
written consent of the Borrower (such consent not to be unreasonably withheld or
delayed).
(g) Any Designated Lender may disclose any Confidential Information to any
rating agency, commercial paper dealer, Liquidity Lender, sureties, reinsurers,
guarantors or credit liquidity enhancers for or to such Designated Lender, and
their respective directors, officers and advisors; provided that each of such
Persons is informed by the Designated Lender of the confidential nature of the
Confidential Information and each such commercial paper dealer, Liquidity
Lender, surety, reinsurer, guarantor or credit liquidity enhancer agrees to be
bound by the terms and conditions of this Section 8.08 to the same extent as the
Designated Lender.
(h) The obligations of the Agent, each Arranger and each Lender under this
Section 8.08 shall survive the termination or expiration of this Agreement.
SECTION 8.09. Governing Law. This Agreement and the Notes shall be governed by,
and construed in accordance with, the Laws of the State of New York.
SECTION 8.10. Execution in Counterparts. This Agreement may be executed in any
number of counterparts and by different parties to this Agreement in separate
counterparts, each of which when so executed shall be deemed to be an original
and all of which taken together shall constitute one and the same agreement.
SECTION 8.11. Jurisdiction, Etc. (a) Each of the parties to this Agreement
hereby irrevocably and unconditionally submits, for itself and its property, to
the nonexclusive jurisdiction of the Supreme Court, New York County, United
States District Court for the Southern District of New York, and any appellate
court from any thereof, in any action or proceeding arising out of or relating
to this Agreement or the Notes, or for recognition or enforcement of any
judgment, and each of the parties to this Agreement hereby irrevocably and
unconditionally agrees that all claims in respect of any such action or
proceeding may be heard and determined in such New York State court or, to the
extent permitted by Law, in such federal court. Each of the parties to this
Agreement agrees that a final judgment in any such action or proceeding shall be
conclusive and may be enforced in other jurisdictions by suit on the judgment or
in any other manner provided by Law. Nothing in this Agreement shall affect any
right that any party may otherwise have to bring any action or proceeding
relating to this Agreement or the Notes in the courts of any jurisdiction.
(b) Each of the parties to this Agreement irrevocably and unconditionally
waives, to the fullest extent it may legally and effectively do so, any
objection that it may now or hereafter have to the laying of venue of any suit,
action or proceeding arising out of or relating to this Agreement or the Notes
in any New York State or federal court. Each of the parties to this Agreement
hereby irrevocably waives, to the fullest extent permitted by Law, the defense
of an inconvenient forum to the maintenance of such action or proceeding in any
such court.
SECTION 8.12. No Bankruptcy Proceedings. Each of the Borrower, the Lenders and
the Agent agrees that it will not institute against any Designated Lender or
join any other Person in instituting against any Designated Lender any
bankruptcy, reorganization, arrangement, insolvency or liquidation proceeding
under any federal or state bankruptcy or similar law, for one year and one day
after the payment in full of the latest maturing commercial paper note issued by
such Designated Lender.
SECTION 8.13. Waiver of Jury Trial. Each of the Borrower, the Agent and the
Lenders hereby irrevocably waives all right to trial by jury in any action,
proceeding or counterclaim (whether based on contract, tort or otherwise)
arising out of or relating to this Agreement, the Notes or any other Loan
Document or the actions of the Agent or any Lender in the negotiation,
administration, performance or enforcement of any such document.
SECTION 8.14. Notes and Loan Documents. Each of the Borrower, the Lenders and
the Agent agrees that the Notes and each of the other Loan Documents are and
shall continue to be in full force and effect and are hereby ratified and
confirmed in all respects. The execution, delivery and effectiveness of this
Agreement shall not, except as expressly provided herein, operate as a waiver of
any right, power or remedy of any Lender or the Agent under any of the Loan
Documents, nor constitute a waiver of any provision of any of the Loan
Documents. On and after the effectiveness of this Agreement, each reference in
each exhibit, schedule, supplement or attachment to the Original Credit
Agreement to "this Agreement," "hereunder," "hereof" or words of like import
referring to the Original Credit Agreement, and each reference in the Notes and
each of the other Loan Documents and in each exhibit, schedule, supplement or
attachment thereto to "the Credit Agreement," "thereunder," "thereof" or words
of like import referring to the Original Credit Agreement, shall mean and be a
reference to this Agreement, as amended, amended and restated, supplemented or
otherwise modified from time to time.
IN WITNESS WHEREOF, the parties to this Agreement have caused
this Agreement to be executed by their respective officers duly authorized for
such purpose, as of the date first above written.
The Borrower
SOUTHERN POWER COMPANY
By:
--------------------------------------------------
Name:
Title:
The Agent
CITIBANK, N.A.
By:
-------------------------------------------------
Name:
Title:
The Initial Lenders
CITIBANK, N.A.
By:
-------------------------------------------------
Name:
Title:
BARCLAYS BANK PLC
By:
-------------------------------------------------
Name:
Title:
THE BANK OF TOKYO-MITSUBISHI, LTD., NEW YORK BRANCH
By:
-------------------------------------------------
Name:
Title:
ING CAPITAL LLC
By:
-------------------------------------------------
Name:
Title:
COMMERZBANK AG, NEW YORK AND GRAND CAYMAN BRANCHES
By:
-------------------------------------------------
Name:
Title:
By:
-------------------------------------------------
Name:
Title:
WACHOVIA BANK, NATIONAL ASSOCIATION
By:
-------------------------------------------------
Name:
Title:
BAYERISCHE LANDESBANK, CAYMAN ISLANDS BRANCH
By:
-------------------------------------------------
Name:
Title:
By:
-------------------------------------------------
Name:
Title:
KBC BANK N.V.
By:
-------------------------------------------------
Name:
Title:
By:
-------------------------------------------------
Name:
Title:
BANK ONE, NA
By:
-------------------------------------------------
Name:
Title:
LEHMAN COMMERCIAL PAPER INC.
By:
-------------------------------------------------
Name:
Title:
MIZUHO CORPORATE BANK, LTD.
By:
-------------------------------------------------
Name:
Title:
MORGAN STANLEY SENIOR FUNDING, INC.
By:
-------------------------------------------------
Name:
Title:
SCOTIABANC INC
By:
-------------------------------------------------
Name:
Title:
SANPAOLO IMI S.p.A.
By:
-------------------------------------------------
Name:
Title:
By:
-------------------------------------------------
Name:
Title:
NORDDEUTSCHE LANDESBANK GIROZENTRALE NEW YORK
BRANCH AND/OR CAYMAN ISLANDS BRANCH
By:
-------------------------------------------------
Name:
Title:
By:
-------------------------------------------------
Name:
Title:
WESTLB AG, NEW YORK BRANCH
By:
-------------------------------------------------
Name:
Title:
By:
-------------------------------------------------
Name:
Title:
SCHEDULE I
AMENDED AND RESTATED
CREDIT AGREEMENT
COMMITMENTS AND APPLICABLE LENDING OFFICES
- ------------------------------- --------------------- ----------------------------------- ------------------------------------
Initial Lenders Commitments Domestic Lending Offices Eurodollar Lending Offices
- ------------------------------- --------------------- ----------------------------------- ------------------------------------
- ------------------------------- --------------------- ----------------------------------- ------------------------------------
Citibank, N.A. $59,000,000 Citibank, N.A. Citibank, N.A.
2 Penns Way, Suite 200 2 Penns Way, Suite 200
New Castle, DE 19720 New Castle, DE 19720
Attention: David Graber Attention: David Graber
Tel: (302) 894-6034 Tel: (302) 894-6034
Fax: (212) 994-0961 Fax: (212) 994-0961
Copy to: Copy to:
Citibank, N.A. Citibank, N.A.
388 Greenwich Street, 20th Floor, 388 Greenwich Street, 20th Floor
New York, NY 10013 New York, NY 10013
Attention: John Maguire Attention: John Maguire
Tel: (212) 816-1081 Tel: (212) 816-1081
Fax: (212) 816-0584 Fax: (212) 816-0584
- ------------------------------- --------------------- ----------------------------------- ------------------------------------
- ------------------------------- --------------------- ----------------------------------- ------------------------------------
Barclays Bank PLC $54,000,000 Barclays Bank PLC, New York Branch Barclays Bank PLC, New York Branch
200 Park Avenue- 4th Floor 200 Park Avenue- 4th Floor
New York, NY 10166 New York, NY 10166
Attention: Sydney Dennis/ Gary Attention: Sydney Dennis/ Gary
Wenslow Wenslow
Tel: (212) 412-2470/1562 Tel: (212) 412-2470/1562
Fax: (212) 412-2441/2879 Fax: (212) 412-52441/2879
- ------------------------------- --------------------- ----------------------------------- ------------------------------------
- ------------------------------- --------------------- ----------------------------------- ------------------------------------
The Bank of Tokyo-Mitsubishi, $54,000,000 The Bank of Tokyo-Mitsubishi The Bank of Tokyo-Mitsubishi Ltd.,
Ltd., New York Branch Ltd., New York Branch New York Branch
1251 Avenue of the Americas 1251 Avenue of the Americas
New York, NY 10020-1104 New York, NY 10020-1104
Attention: Mr. Rolando Uy, AVP, Attention: Mr. Rolando Uy, AVP,
Loan Operations Dept. Loan Operations Dept.
BTM Information Services, Inc. BTM Information Services, Inc.
Tel: (201) 413-8570 Tel: (201) 413-8570
Fax: (201) 521-2304/2305 Fax: (201) 521-2304/2305
- ------------------------------- --------------------- ----------------------------------- ------------------------------------
- ------------------------------- --------------------- ----------------------------------- ------------------------------------
ING Capital LLC $54,000,000 ING Capital LLC ING Capital LLC
1325 Avenue of the Americas, 7th 1325 Avenue of the Americas, 7th
floor floor
New York, NY 10019 New York, NY 10019
Attention: Charmen Smith Attention: Charmen Smith
Tel: (646) 424-6458 Tel: (646) 424-6458
Fax: (646) 424-6441 Fax: (646) 424-6441
- ------------------------------- --------------------- ----------------------------------- ------------------------------------
- ------------------------------- --------------------- ----------------------------------- ------------------------------------
Commerzbank AG, New York and $54,000,000 Commerzbank AG, Atlanta Agency Commerzbank AG, Atlanta Agency
Grand Cayman Branches 1230 Peachtree St., N.E. 1230 Peachtree St., N.E.
Suite 3500 Suite 3500
Atlanta, GA 30309 Atlanta, GA 30309
Attention: Brian Campbell, Senior Attention: Brian Campbell, Senior
Vice President Vice President
Tel: (404) 888-6518 Tel: (404) 888-6518
Fax: (404) 888-6539 Fax: (404) 888-6539
Copy to: Commerzbank AG, Copy to: Commerzbank AG,
2 World Financial Center, 32nd 2 World Financial Center, 32nd
floor floor
New York, NY 10281 New York, NY 10281
Attention: Joy Lynn Jarvis Attention: Joy Lynn Jarvis
Tel: (212) 266-7348 Tel: (212) 266-7348
Fax: (212) 298-8111 Fax: (212) 298-8111
- ------------------------------- --------------------- ----------------------------------- ------------------------------------
- ------------------------------- --------------------- ----------------------------------- ------------------------------------
Wachovia Bank, National $41,000,000 Wachovia Bank, National Wachovia Bank, National Association
Association Association 201 South College Street NC1183
201 South College Street NC1183 Charlotte, NC 28288-1183
Charlotte, NC 28288-1183 Attention: Chanue Michael
Attention: Chanue Michael Tel: (704) 715-1195
Tel: (704) 715-1195 Fax: (704) 383-7201
Fax: (704) 383-7201
- ------------------------------- --------------------- ----------------------------------- ------------------------------------
- ------------------------------- --------------------- ----------------------------------- ------------------------------------
Bayerische Landesbank, Cayman $41,000,000 Bayerische Landesbank Bayerische Landesbank
Islands Branch 560 Lexington Avenue 560 Lexington Avenue
New York, NY 10022 New York, NY 10022
Attention: Sean O'Sullivan/ Attention: Sean O'Sullivan/
Patricia Sanchez Patricia Sanchez
Tel: (212) 310-9913/9810 Tel: (212) 310-9913/9810
Fax: (212) 310-9868/9930 Fax: (212) 310-9868/9930
- ------------------------------- --------------------- ----------------------------------- ------------------------------------
- ------------------------------- --------------------- ----------------------------------- ------------------------------------
KBC Bank N.V. $41,000,000 KBC Bank N.V. KBC Bank N.V.
New York Branch New York Branch
125 West 55th Street, 10th floor 125 West 55th Street, 10th floor
New York, NY 10019 New York, NY 10019
Attention: Robert Pacifici/ Loan Attention: Robert Pacifici/ Loan
Administration Administration
Tel: (212) 541-0671 Tel: (212).541-0671
Fax: (212) 541-5581 Fax: (212) 541-5581
Copy to: Copy to:
KBC Bank N.V. KBC Bank N.V.
245 Peachtree Center Avenue, 245 Peachtree Center Avenue, Suite
Suite 2550 2550
Atlanta, Georgia 30303 Atlanta, Georgia 30303
Attention: Jacqueline Brunetto, Attention: Jacqueline Brunetto,
VP/ Filip Berton, AVP VP/ Filip Berton, AVP
Tel: (404) 584-5466 Tel: (404) 584-5466
Fax: (404) 584-5465 Fax: (404) 584-5465
- ------------------------------- --------------------- ----------------------------------- ------------------------------------
- ------------------------------- --------------------- ----------------------------------- ------------------------------------
Bank One, NA $41,000,000 Bank One, NA Bank One, NA
21 South Clark 21 South Clark
Suite IL1-0363 Suite IL1-0363
Chicago IL 60670 Chicago IL 60670
Attention: Dawn M. Lawler/ Dawn. Attention: Dawn M. Lawler/ Dawn.
M. Hamm M. Hamm
Tel: (312) 732-3857/6899 Tel: (312) 732-3857/6899
Fax: (312) 732-5435/3055 Fax: (312) 732-5435/3055
- ------------------------------- --------------------- ----------------------------------- ------------------------------------
- ------------------------------- --------------------- ----------------------------------- ------------------------------------
Lehman Commercial Paper Inc. $41,000,000 Lehman Commercial Paper Inc. Lehman Commercial Paper Inc.
745 7th Avenue 745 7th Avenue
New York, NY 10019 New York, NY 10019
Attention: Suzanne Flynn/ Attention: Suzanne Flynn/
Priyanka Mathew Priyanka Mathew
Tel: (212) 526-3163/6560 Tel: (212) 526-3163/6560
Fax: (646) 758-2096/ Fax: (646) 758-2096/
(212) 526-6653 (212) 526-6653
- ------------------------------- --------------------- ----------------------------------- ------------------------------------
- ------------------------------- --------------------- ----------------------------------- ------------------------------------
Mizuho Corporate Bank, LTD. $41,000,000 Mizuho Corporate Bank, LTD Mizuho Corporate Bank, LTD
1251 Avenue of the Americas 1251 Avenue of the Americas
New York, NY 10020-1104 New York, NY 10020-1104
Attention: Noreen Dowers Attention: Noreen Dowers
Tel: (201) 626-9158 Tel: (201) 626-9158
Fax: (201) 626-9941 Fax: (201) 626-9941
- ------------------------------- --------------------- ----------------------------------- ------------------------------------
- ------------------------------- --------------------- ----------------------------------- ------------------------------------
Morgan Stanley Senior $41,000,000 Morgan Stanley Senior Funding, Morgan Stanley Senior Funding, Inc.
Funding, Inc. Inc. 1585 Broadway
1585 Broadway New York NY 10036
New York NY 10036 Attention: Larry Benison/ Theresa
Attention: Larry Benison/ Amato
Theresa Amato Tel: (212) 537-1439/1384
Tel: (212) 537-1439/1384 Fax: (212) 537-1867/1866
Fax: (212) 537-1867/1866
- ------------------------------- --------------------- ----------------------------------- ------------------------------------
- ------------------------------- --------------------- ----------------------------------- ------------------------------------
Scotiabanc Inc $38,000,000 Scotiabanc Inc Scotiabanc Inc
Suite 2700, 600 Peachtree St. N.E. Suite 2700, 600 Peachtree St. N.E.
Atlanta GA 30308 Atlanta GA 30308
Attention: William E. Zarrett/ Attention: William E. Zarrett/
Jay Willson Jay Willson
Tel: (404) 877-1504 Tel: (404) 877-1504
Fax: (404) 888-8998 Fax: (404) 888-8998
- ------------------------------- --------------------- ----------------------------------- ------------------------------------
- ------------------------------- --------------------- ----------------------------------- ------------------------------------
SANPAOLO IMI S.p.A. $20,000,000 SANPAOLO IMI S.p.A. SANPAOLO IMI S.p.A.
245 Park Avenue, 35th Floor 245 Park Avenue, 35th Floor
New York, NY 10167 New York, NY 10167
Attention: Glen Binder Attention: Glen Binder
Tel: (212) 692-3016 Tel: (212) 692-3016
Fax: (212) 692-3178 Fax: (212) 692-3178
- ------------------------------- --------------------- ----------------------------------- ------------------------------------
- ------------------------------- --------------------- ----------------------------------- ------------------------------------
Norddeutsche Landesbank $15,000,000 NORD/LB New York Branch NORD/LB Cayman Islands Branch
Girozentrale New York Branch 1114 Avenue of the Americas, 37th 1114 Avenue of the Americas, 37th
and/or Cayman Islands Branch Floor Floor
New York, NY 10036 New York, NY 10036
Attention: Andrea Johann, Loan Attention: Andrea Johann, Loan
Administration Group Administration Group
Tel: (212) 812-6830/6984 Tel: (212) 812-6830/6984
Fax: (212) 812-6930 Fax: (212) 812-6930
- ------------------------------- --------------------- ----------------------------------- ------------------------------------
- ------------------------------- --------------------- ----------------------------------- ------------------------------------
WestLB AG, New York Branch $15,000,000 WestLB AG, New York Branch WestLB AG, New York Branch
1211 Avenue of the Americas 1211 Avenue of the Americas
New York, NY 10036 New York, NY 10036
Attention: Felicia La Forgia Attention: Felicia La Forgia
Tel: (212) 852-6096 Tel: (212) 852-6096
Fax: (212) 852-6307 Fax: (212) 852-6307
- ------------------------------- --------------------- ----------------------------------- ------------------------------------
SCHEDULE II
AMENDED AND RESTATED
CREDIT AGREEMENT
TERMS OF SUBORDINATION
Terms defined in the Credit Agreement referred to below are
used in these Terms of Subordination with their defined meanings except as
otherwise defined herein.
SECTION 1. "Affiliate Subordinated Debt" Defined. "Affiliate
Subordinated Debt" means, for purposes of these Terms of Subordination (the
"Agreement"), [describe the specific Affiliate Subordinated Debt that is being
subordinated hereby -- to include all amounts payable in connection therewith],
which constitutes debt of the Borrower originally issued to a Person that is an
Affiliate of the Borrower and which is subordinated on the terms set forth
below. Debt of the Borrower payable to any entity that is formed by the Borrower
or an Affiliate of the Borrower for the purpose of issuing securities in the
public or capital markets, or in a private placement, shall not constitute
"Affiliate Subordinated Debt" for all purposes hereof.
SECTION 2. Agreement to Subordinate. The holder hereof (the
"Subordinated Creditor") and the Borrower each agree that the Affiliate
Subordinated Debt is and shall be subordinate and subject in right of payment,
to the extent and in the manner hereinafter set forth, to the prior payment in
full of all obligations of the Borrower now or hereafter existing under (a) the
Amended and Restated Credit Agreement, dated as of April 17, 2003, as from time
to time in effect (the "Credit Agreement"), among the Borrower, the financial
institution(s) party thereto and Citibank, N.A., as Agent for such financial
institution(s), and any promissory notes (the "Notes") issued pursuant thereto
and (b) such documents as may be listed on Schedule I hereto on the date of
execution hereof or from time to time added to said Schedule I (other than any
such document which the Senior Creditors (as hereinafter defined) thereunder
have agreed may be deleted from said Schedule I from time to time) by a writing
signed by the Borrower and the Subordinated Creditor (such documents being
referred to herein collectively as the "Senior Debt Documents"), whether for
principal, interest (including, without limitation, interest, as provided in the
Notes and in the debt instruments included in the Senior Debt Documents (such
debt instruments included in the Senior Debt Documents being referred to herein
collectively as the "Senior Debt Instruments"), accruing after the filing of a
petition initiating any proceeding referred to in Section 3(a), whether or not
such interest accrues after the filing of such petition for purposes of the
Federal Bankruptcy Code or is an allowed claim in such proceeding), fees,
expenses, indemnity or other amounts due thereunder (such obligations of the
Borrower under the Credit Agreement and the Senior Debt Documents being the
"Obligations"). For the purposes of this Agreement, the Obligations shall not be
deemed to have been paid in full until (i) with respect to the Lenders, the
earlier of (A) the Final Maturity Date, and (B) the date of termination in whole
of each Lender's commitment (the "Termination Date") under the Credit Agreement
shall have occurred and (ii) with respect to each Senior Creditor, the
obligation under each of its respective Senior Debt Documents to extend credit,
disburse funds or acquire a debt instrument shall have terminated and unless the
Lenders, the creditors under the Senior Debt Documents and the holders (other
than the Lenders) of the Senior Debt Instruments (such creditors and holders
being referred to collectively herein as the "Senior Creditors") shall have
received payment of their respective Obligations in full in cash. The Borrower
and the Subordinated Creditor shall endorse on any instrument evidencing
Affiliate Subordinated Debt a statement to the effect that it is subject to
these terms of subordination.
SECTION 3. Events of Subordination. (a) In the event of any
dissolution, winding up, liquidation, arrangement, reorganization, adjustment,
protection, relief or composition of the Borrower or its debts, whether
voluntary or involuntary, in any bankruptcy, insolvency, arrangement,
reorganization, receivership, relief or other similar case or proceeding under
any federal or state bankruptcy or similar law or upon an assignment for the
benefit of creditors or any other marshaling of the assets and liabilities of
the Borrower or otherwise, the Lenders and the Senior Creditors shall be
entitled to receive payment in full of their respective Obligations before the
Subordinated Creditor is entitled to receive any payment of all or any of the
Affiliate Subordinated Debt, and any payment or distribution of any kind
(whether in cash, property or securities) that otherwise would be payable or
deliverable upon or with respect to the Affiliate Subordinated Debt in any such
case, proceeding, assignment or marshaling (including any payment that may be
payable by reason of any other Debt of the Borrower being subordinated to
payment of the Affiliate Subordinated Debt) shall be paid or delivered directly
to Citibank, as Agent under the Credit Agreement, for the account of the
Lenders, and to the Senior Creditors or to a trustee or other agent for the
Senior Creditors or for any group of the Senior Creditors (any such trustee or
agent being referred to herein as a "Representative") which may be listed on
Schedule I hereto, pro rata according to the principal amount of the Obligations
then owed by the Borrower to each of the Lenders and the Senior Creditors, for
application (in the case of cash) to, or as collateral (in the case of non-cash
property or securities) for, the payment or prepayment of the Obligations until
the Obligations shall have been paid in full.
(b) In the event that (i) any Default or Event of Default
described in Section 6.01 of the Credit Agreement or any payment default by the
Borrower under a Senior Debt Document shall have occurred and be continuing,
(ii) any Event of Default or any "event of default" under a Senior Debt Document
that would entitle the creditors under such Senior Debt Document to accelerate
the maturity of indebtedness evidenced by such Senior Debt Document (a "Senior
Event of Default") (other than as referred to in the preceding clause (i)) shall
have occurred and be continuing or (iii) any judicial proceeding shall be
pending with respect to any Event of Default or Senior Event of Default, then no
payment (including any payment that may be payable by reason of any other Debt
of the Borrower being subordinated to payment of the Affiliate Subordinated
Debt) or distribution of any kind, whether in cash, property or securities,
shall be made by or on behalf of the Borrower for or on account of any Affiliate
Subordinated Debt, and the Subordinated Creditor shall not take or receive from
the Borrower, directly or indirectly, in cash or other property or by set-off in
any other manner, including, without limitation, from or by way of collateral,
payment of all or any of the Affiliate Subordinated Debt until the Obligations
shall have been paid in full.
(c) Until the Termination Date under the Credit Agreement
shall have occurred and the Obligations thereunder then owned by the Borrower to
the Lenders shall have been paid in full in cash, no payment (including any
payment that may be payable by reason of any other Debt of the Borrower being
subordinated to the payment of the Affiliate Subordinated Debt) or distribution
of any kind, whether in cash, property or securities, shall be made by or on
behalf of the Borrower for or on account of any Affiliate Subordinated Debt, and
the Subordinated Creditor shall not take or receive from the Borrower, directly
or indirectly, in cash, property or securities or by set-off or in any other
manner, including, without limitation, from or by way of collateral, payment of
all or any of the Affiliate Subordinated Debt at any time (i) unless at the end
of the fiscal quarter (including the fourth fiscal quarter) of the Borrower for
which financial statements have most recently been delivered to the Agent by the
Borrower pursuant to Section 5.01(d) or (e) of the Credit Agreement on or
preceding the date on which the Borrower takes such action, the ratio of Cash
Available for Corporate Debt Service to Corporate Interest was at least
2.00:1.00 or, if the Borrower does not have at least an Investment Grade Rating,
2.25:1.00, in each case, for the period comprised of the four fiscal quarters
ending on the date of such financial statements and with effect from the date of
delivery of such financial statements; or (ii) with respect solely to Affiliate
Subordinated Debt loaned to the Borrower to pay Project Costs of any Project at
any time prior to the Non-Recourse Date for such Project, if, no more frequently
than once each calendar month, such payment or distribution is made on, or
within three (3) Business Days after, the date of, and using the proceeds of the
Project Advances or Commercial Paper (as applicable) arising from, or relating
to, a Utilization with respect to such Project; provided, that the amount of
interest, fees and other charges, if any, paid with respect to any Affiliate
Subordinated Debt under this subsection (ii) will not exceed the maximum rate or
amount permitted under PUHCA (whether or not such law is repealed).
SECTION 4. In Furtherance of Subordination. The Subordinated Creditor
agrees as follows:
(a) If any proceeding referred to in Section 3(a) above is
commenced by or against the Borrower,
(i) Citibank, as Agent for the Lenders, and the
Senior Creditors, acting directly or through one or more
Representatives, are hereby irrevocably authorized and
empowered (in their own names or in the name of the
Subordinated Creditor or otherwise), but shall have no
obligation, to demand, sue for, collect and receive every
payment or distribution referred to in Section 3(a) to which
they are entitled thereunder and give acquittance therefor and
to file claims and proofs of claim and take such other action
(including, without limitation, voting the Affiliate
Subordinated Debt pro rata according to the principal amount
of the Obligations then owed by the Borrower to each of the
Lenders and the Senior Creditors or enforcing any security
interest or other lien securing payment of the Affiliate
Subordinated Debt) as it may deem necessary or advisable for
the exercise or enforcement of any of the rights or interests
of the Agent, the Lenders, the Representatives and the Senior
Creditors hereunder; and
(ii) the Subordinated Creditor shall duly and
promptly take such reasonable actions as Citibank, as Agent
for the Lenders and the Senior Creditors or the
Representatives may request (A) to permit Citibank, as Agent
of the Lenders, and the Senior Creditors or the
Representatives to collect the Subordinated Debt for the
account of the Lenders and the Senior Creditors and to file
appropriate claims or proofs of claim in respect of the
Subordinated Debt, (B) to execute and deliver to Citibank, as
Agent for the Lenders, and to the Senior Creditors or their
Representatives such documents as Citibank, as Agents for the
Lenders and the Senior Creditors or the Representatives may
reasonably request in order to enable Citibank, as Agent for
the Lenders, and the Senior Creditors or the Representatives
to enforce any and all claims with respect to, and any
security interest and other liens securing payment of, the
Subordinated Debt, and (C) to collect and receive any and all
payments or distributions which may be payable or deliverable
upon or with respect to the Subordinated Debt, which payments
and distributions shall be distributed pro rata according to
the principal amount of the Obligations then owed by the
Borrower to each of the Lenders and the Senior Creditors.
(b) All payments or distributions upon or with respect to the
Affiliate Subordinated Debt which are received by the Subordinated
Creditor contrary to the provisions of this Agreement shall be received
in trust for the benefit of the Lenders and the Senior Creditors pro
rata according to the principal amount of the Obligations then owed by
the Borrower to each of the Lenders and the Senior Creditors, shall be
segregated from other funds and property held by the Subordinated
Creditor and shall be forthwith paid over to Citibank, as Agent for the
Lenders, for the account of the Lenders, and to the Senior Creditors or
their Representatives pro rata according to the principal amount of the
Obligations then owed by the Borrower to each of the Lenders and the
Senior Creditors, in the same form as so received (with any necessary
indorsement) to be applied (in the case of cash) to, or held as
collateral (in the case of non-cash property or securities) for, the
payment or prepayment of the Obligations in accordance with the terms
of the Credit Agreement and the Senior Debt Documents. Any portion of a
payment or distribution received by a Lender or Senior Creditor (or by
the Agent or a Representative) which is in excess of its pro rata
portion of such payment or distribution shall be held in trust by such
Lender or Senior Creditor (or Agent or Representative) for the benefit
of the other Lenders and Senior Creditors to be paid promptly to the
other Lenders and Senior Creditors (or to the Agent and the
Representatives on behalf of such Lenders and Senior Creditors) pro
rata according to the principal amount of the Obligations then owed by
the Borrower to each of such Lenders and Senior Creditors.
(c) Citibank, as Agent for the Lenders, and the Senior
Creditors or their Representatives are hereby authorized to seek
specific performance of this Agreement, whether or not the Borrower
shall have complied with any of the provisions hereof applicable to it,
at any time when the Subordinated Creditor shall have failed to comply
with any of the provisions of this Agreement applicable to it.
SECTION 5. No Commencement of Any Proceeding. The Subordinated
Creditor agrees that, so long as the Obligations shall not have been paid in
full in cash, the Subordinated Creditor will not sue for payment of all or any
of the Affiliate Subordinated Debt, or commence, or join with any creditor other
than the Lenders, Citibank, as Agent for the Lenders, the Senior Creditors and
the Representatives, in commencing any proceeding referred to in Section 3(a);
provided, however, that the foregoing provisions shall not prevent the
Subordinated Creditor from commencing and prosecuting to judgment any action
necessary to enforce such Affiliate Subordinated Debt during the period
commencing one year prior to the expiration of the limitation period governing
such Affiliate Subordinated Debt under any applicable statute of limitations.
SECTION 6. Rights of Subrogation. The Subordinated Creditor
agrees that no payment or distribution to Citibank, as Agent for the Lenders,
the Lenders, the Senior Creditors or the Representatives pursuant to the
provisions of this Agreement shall entitle the Subordinated Creditor to exercise
any right of subrogation in respect thereof until the Obligations shall have
been paid in full. From and after the payment in full of the Obligations, the
Subordinated Creditor shall be subrogated to all rights of the Agent, the
Lenders, the Senior Creditors and the Representatives to receive any further
payments or distributions applicable to the Obligations until the Affiliate
Subordinated Debt shall have been paid in full, in addition to all other rights
of subrogation that the Subordinated Creditor may have. For purposes of any such
subrogation, no payments or distributions on the Obligations pursuant to this
Agreement shall, as between the Borrower, its creditors other than the Lenders
and the Senior Creditors, and the Subordinated Creditor, be deemed to be a
payment by the Borrower to or on account of the Obligations, and no payments or
distributions to the Subordinated Creditor of assets by virtue of the
subrogation herein provided for shall, as between the Borrower, its creditors
other than the Lenders and the Senior Creditors, and the Subordinated Creditor,
be deemed to be a payment by the Borrower to or on account of the Obligations,
and no payments or distributions to the Subordinated Creditor of assets by
virtue of the subrogation herein provided for shall, as between the Borrower,
its creditors other than the Lenders and the Senior Creditors, and the
Subordinated Creditor, be deemed to be a payment to or on account of the
Affiliate Subordinated Debt. The provisions of this Agreement are and are
intended solely for the purpose of defining the relative rights of the
Subordinated Creditor, on the one hand, and the Lenders, the Agent for the
benefit of the Lenders, the Senior Creditors and the Representatives, on the
other hand, and nothing contained in this Agreement is intended to or shall
impair the obligation of the Borrower, which is unconditional and absolute, to
pay the principal of (and premium, if any) and interest on the Affiliate
Subordinated Debt as and when the same shall become due and payable in
accordance with its terms, or, except as provided in Section 10 below, to affect
the relative rights of the Subordinated Creditor and the creditors of the
Borrower other than the Lenders and the Senior Creditors, nor shall anything
herein prevent the Subordinated Creditor from exercising all remedies otherwise
permitted by applicable law upon default under the Affiliate Subordinated Debt,
subject to the rights, if any, under this Agreement, of the Lenders, the Agent
for the benefit of the Lenders, the Senior Creditor and the Representatives in
respect of cash, property or securities of the Borrower otherwise payable or
delivered to the Subordinated Creditor upon the exercise of any such remedy.
SECTION 7. Agreements in Respect of Affiliate Subordinated
Debt. The Subordinated Creditor will not sell, assign, pledge, encumber or
otherwise dispose of any of the Affiliate Subordinated Debt unless such sale,
assignment, pledge, encumbrance or disposition (i) is to an Affiliate of the
Borrower other than a Subsidiary of the Borrower (ii) is made expressly subject
to this Agreement.
SECTION 8. Obligations Hereunder Not Affected. All rights and
interest of Citibank, as Agent for the Lenders, the Lenders, the Senior
Creditors and the Representatives hereunder, and all agreements and obligations
of the Subordinated Creditor and the Borrower under this Agreement, shall remain
in full force and effect irrespective of:
(i) any lack of validity or enforceability of the Credit
Agreement, a Note, a Senior Debt Document or any other agreement or
instrument relating thereto;
(ii) any change in the time, manner or place of payment of, or
in any other term of, all or any of the Obligations, or any other
amendment or waiver of or any consent to any departure from the Credit
Agreement, a Note or a Senior Debt Document, including, without
limitation, any increase in the Obligations resulting from the
extension of additional credit to the Borrower or otherwise;
(iii) any taking, exchange, release or non-perfection of any
collateral, or any taking, release or amendment or waiver of or consent
to departure from any guaranty, for all or any of the Obligations;
(iv) any manner of application of collateral, or proceeds
thereof, to all or any of the Obligations, or any manner of sale or
other disposition of any collateral for all or any of the Obligations
or any other assets of the Borrower or any of its subsidiaries;
(v) any change, restructuring or termination of the corporate
structure or existence of the Borrower; or
(vi) any other circumstance which might otherwise constitute a
defense available to, or a discharge of, the Borrower or a subordinated
creditor.
This Agreement shall continue to be effective or be reinstated, as the case may
be, if at any time any payment of any of the Obligations is rescinded or must
otherwise be returned by Citibank, as Agent for the Lenders, any Lender, any
Senior Creditor or any Representative upon the insolvency, bankruptcy or
reorganization of the Borrower or otherwise, all as though such payment had not
been made.
SECTION 9. Waiver. The Subordinated Creditor and the Borrower
each hereby waives promptness, diligence, notice of acceptance and any other
notice with respect to any of the Obligations and this Agreement and any
requirement that Citibank, as Agent for the Lenders, any Lender, any Senior
Creditor or any Representative protect, secure, perfect or insure any security
interest or lien or any property subject thereto or exhaust any right or take
any action against the Borrower or any other person or entity or any collateral.
SECTION 10. Extension of Subordination. The Borrower and the
Subordinated Creditor shall not subordinate the Affiliate Subordinated Debt for
the benefit of any one or more other creditors of the Borrower, now or hereafter
existing, upon any terms other than those set forth in this Agreement. The
Borrower and the Subordinated Creditor shall have the right to subordinate the
Affiliate Subordinated Debt for the benefit of any one or more other creditors
of the Borrower, now or hereafter existing, upon the same terms as are set forth
in this Agreement.
SCHEDULE I
Senior Debt Documents
Title and Date Party(ies) Representative
SCHEDULE III
AMENDED AND RESTATED
CREDIT AGREEMENT
PROJECT LIMITS FOR INITIAL PROJECTS
Initial Project Total Project Costs (Estimated if an Project Limit
--------------- ------------------------------------- -------------
Uncompleted Project, and actual, if a
Completed Project)
Harris 1 Project $270,512,613 $175,833,199
Harris 2 Project $242,292,211 $157,489,937
Dahlberg $265,341,836 $159,205,102
Franklin 1 Project $229,183,570 $137,510,142
Franklin 2 Project $246,205,077 $160,033,300
Wansley $451,387,132 $270,832,279
SCHEDULE IV
AMENDED AND RESTATED
CREDIT AGREEMENT
SCHEDULED COMPLETION DATE, GUARANTEED HEAT RATE
AND GUARANTEED OUTPUT FOR EACH INITIAL PROJECT
1. Scheduled Completion Dates
--------------------------- -------------------------
Initial Project Scheduled Completion Date
--------------------------- -------------------------
--------------------------- -------------------------
Harris 1 Project June 1, 2003
--------------------------- -------------------------
--------------------------- -------------------------
Harris 2 Project June 1, 2003
--------------------------- -------------------------
--------------------------- -------------------------
Dahlberg June 1, 2001 (Completed)
--------------------------- -------------------------
--------------------------- -------------------------
Franklin 1 Project April 1, 2002
--------------------------- -------------------------
--------------------------- -------------------------
Franklin 2 Project June 1, 2003
--------------------------- -------------------------
--------------------------- -------------------------
Wansley Project June 1, 2002
--------------------------- -------------------------
2. Guaranteed Heat Rates
Guaranteed Heat Rate with respect to the following Initial Projects, at the
relevant average ambient rated conditions for such Project, are set forth below:
--------------------------------------------------------------------------------------------------------------------
Power Power HP IP Condenser Condenser
Average Base Mode Dry Bulb Relative Fuel Factor Factor Blowdown Blowdown Makeup Makeup
Annual Heat Rate* Temperature Humidity Elevation Temperature** (GT) (ST) Flow Flow Flow Temp.
Ambient
--------------------------------------------------------------------------------------------------------------------
Btu/kWh F % Ft. F - - % % Lb/Hr F
--------------------------------------------------------------------------------------------------------------------
Franklin 1 6,711 64.0 74.5 560 25.0 0.85 0.85 0.5 1.0 1169 65
Franklin 2 6,728 64.0 74.5 560 25.0 0.85 0.90 0.5 1.0 1049 65
Harris 1 6,730 64.8 73.8 200 25.0 0.85 0.90 0.5 1.0 1068 65
Harris 2 6,730 64.8 73.8 200 25.0 0.85 0.90 0.5 1.0 1068 65
Wansley 6,706 61.0 69.0 740 25.0 0.85 0.85 0.5 1.0 1172 63
--------------------------------------------------------------------------------------------------------------------
* All to the high side of the generator step-up transformer
** 25F is as of the gas is delivered to each combustion turbine. The gas is
then heated by the Project's process before entry to the combustion turbine
burner
3. Guaranteed Output
Guaranteed Output with respect to the following Initial Project, at the relevant
rated summer conditions for such Project, are set forth below:
--------------------------------------------------------------------------------------------------------------------
Summer Power Power HP IP Condenser Condenser
Peak Dry Bulb Relative Fuel Factor Factor Blowdown Blowdown Makeup Makeup
Summer Capacity* Temperature Humidity Elevation Temperature** (GT) (ST) Flow Flow Flow Temp.
--------------------------------------------------------------------------------------------------------------------
MW F % Ft. F - - % % Lb/Hr F
--------------------------------------------------------------------------------------------------------------------
Franklin 1 571 95.0 40.0 560 25.0 0.82 0.98 0.5 1.0 224,005 83
Franklin 2 615 95.0 39.8 560 25.0 0.82 0.95 0.5 1.0 226,689 83
Harris 1 618 95.0 44.3 200 25.0 0.82 0.95 0.5 1.0 229,045 83
Harris 2 618 95.0 44.3 200 25.0 0.82 0.95 0.5 1.0 229,045 83
Wansley 1134 95.0 42.5 740 25.0 0.83 0.98 0.5 1.0 221,913 80
--------------------------------------------------------------------------------------------------------------------
* All to the high side of the generator step-up transformer
** 25F is as of the gas is delivered to each combustion turbine. The gas is
then heated by the Project's process before entry to the combustion turbine
burner
SCHEDULE V
AMENDED AND RESTATED
CREDIT AGREEMENT
TESTING PROCEDURES
A. COMBINED-CYCLE PROJECTS
Introduction:
The procedures and required tests which must be completed prior to Southern's
certification of Substantial Completion and Final Completion with respect to an
Uncompleted Project which is a combined-cycle electric generation plant are set
forth below. The capacity and heat rate tests for such Project may be conducted
independently; provided that if the Guaranteed Heat Rate and Guaranteed Output
for such Project are based upon the same ambient conditions and operating mode
(e.g., base mode, full pressure and power augmentation), the capacity and heat
rate tests for such Project shall be conducted simultaneously.
The tests will be conducted by the owner according to a test procedure
(incorporating the relevant matters set forth herein) provided by the owner and
approved by Southern Company Services, Inc. ("SCS") and the purchaser of energy
from such Project under each Power Purchase Agreement, if any, applicable
thereto. The test procedure will be based on ASME PTC 46-1996 ("PTC 46"). This
code determines the net electrical output and heat rate of the Project,
corrected to design operating conditions.
The Uncompleted Project shall demonstrate compliance with the air permit limits
during the tests (using certified plant continuous emissions monitoring system
("CEMS"), calibrated portable CEMS, or by certified emissions testing
contractor) and all applicable laws and other permits, with no waivers or
variances for construction, start-up, testing or otherwise.
The tests will encompass a control volume including the cooling tower as shown
in Figure 5.1 of PTC 46. The only essential data required are those parameters
which cross the test boundary. Correction curves will be utilized to correct net
unit performance from test conditions to design conditions.
The tests will be conducted after all required systems are fully commissioned
and at actual ambient and operating conditions as close as practical to design
conditions. Heat recovery steam generator ("HRSG") blowdown will be isolated
during the tests since these flows are unmetered; however, corrections to
account for design flows will be applied. All auxiliary components must be
operated in a normal manner consistent with Prudent Utility Practices. "Prudent
Utility Practices" shall mean at a particular time, any of the practices,
methods and acts engaged in or approved by a significant portion of the United
States electric utility industry as at such time, or any of the practices,
methods and acts which, in the exercise of reasonable judgment in light of the
facts known at the time the decision was made, could have been expected to
accomplish the desired results at a reasonable cost consistent with good
business practices, reliability, safety and expedition. Prudent Utility
Practices is not intended to be limited to the optimum practice, method or act
to the exclusion of all others, but rather to be a spectrum of possible
practices, methods or acts expected to accomplish the desired results, having
due regard for, among other things, manufacturers' warranties and the
requirements of governmental authorities of competent jurisdiction.
Capacity Testing:
Capacity test results will be corrected to the rated conditions (the "Output
Rated Conditions") applicable to the Guaranteed Output for such Project, as set
forth, (a) in the case of an Initial Project, in Schedule IV to the Credit
Agreement; or (b) in the case of a Subsequent Project, in the Project Schedule
delivered pursuant to Section 3.04 of the Credit Agreement for such Project. The
demonstrated net output of the Project will be as measured by the test metering
system and corrected to such Project's Output Rated Conditions. PTC 46
correction curves will be produced by SCS using a GateCycle computer model,
created from design input provided by the equipment vendors. Combustion turbine
evaporative coolers, HRSG ductburners and power augmentation steam injection
will be in service.
Net unit capacity will be corrected from test to design conditions for the
following parameters as required by PTC 46:
Ambient Dry Bulb Temperature Ambient Humidity (or wet bulb temperature)
Barometric Pressure (or elevation) HRSG Blowdown Flow Condenser Makeup Flow and
Temperature Fuel Temperature (upstream of fuel heaters) Power Factor (each
generator) Abnormal Auxiliary Power Loads Abnormal Fuel Properties Abnormal Unit
Operating Conditions
Heat Rate Testing:
Heat rate test results will be corrected to the rated operating conditions (the
"Heat Rate Rated Conditions") applicable to the Guaranteed Heat Rate for such
Project, as set forth, (a) in the case of an Initial Project, in Schedule IV to
the Credit Agreement; or (b) in the case of a Subsequent Project, in the Project
Schedule delivered pursuant to Section 3.04 of the Credit Agreement for such
Project. The demonstrated net heat rate of the Project will be as measured by
the test metering system and corrected to such Project's Heat Rate Rated
Conditions. PTC 46 heat rate correction curves will be produced by SCS using a
GateCycle computer model, created from design input provided by the equipment
vendors. Combustion turbine evaporative coolers will be in service or
appropriate corrections will be applied. HRSG ductburners and power augmentation
will be out of service.
Net unit heat rate will be corrected from test to design conditions for the
following parameters, as required by PTC 46:
Ambient Dry Bulb Temperature
Ambient Humidity (or wet bulb temperature)
HRSG Blowdown Flow
-
Condenser Makeup Flow and Temperature
-
Fuel Temperature (Upstream of fuel heaters)
Power Factor (each generator)
Abnormal Aux. Power Loads
Abnormal Fuel Properties
Abnormal Unit Operating Conditions
Essential Data Requirements:
Test data will be obtained using test instruments which meet the requirements of
PTC 46. Specific methods which will be employed for significant data points are
as follows:
1. Net power will be determined from the sum of gross combustion turbine
output and steam turbine output, less station service and main
transformer losses.
2. Combustion turbine gross output will be measured using temporary test
watt meters installed in parallel with station watt meters.
3. Steam turbine gross output will be measured using temporary test watt
meters installed in parallel with station watt meters.
4. Station service will be measured using installed station watt hour
meters.
5. Main transformer losses will be calculated from transformer shop test
data.
6. Net fuel consumption will be the sum of fuel flow to each combustion
turbine and the ductburners.
7. Natural gas flows to each combustion turbine and ductburner will be
determined using test differential pressure transmitters installed in
parallel with station instruments across the existing plant orifice
meter tubes. Test instruments also will be used to measure gas pressure
and temperatures.
8. Natural gas flowrates will be calculated using the formulas provided in
ASME MFC-3M.
9. Fuel properties will be determined from gas samples taken during each
test and analyzed by an independent analysis laboratory.
10. Ambient pressure will be measured using an electronic test barometer
meeting ASME PTC 22 requirements.
11. Combustion turbine inlet dry bulb temperatures will be determined by a
test temperature grid installed in the inlet of each combustion turbine
unit.
12. Combustion turbine inlet wet bulb temperature and relative humidity
will be determined using a test psychrometer in the inlet of each
combustion turbine unit.
13. Substitute or temporary plant equipment shall not be used during
testing, and the Uncompleted Project shall be tested while in an
"automatic mode" to an extent consistent with normal operating
practice.
14. Cooling tower inlet dry and wet bulb temperatures will be determined
based on dedicated temperature readings near the cooling tower(s).
Test Conditions:
At least two test runs of one hour each will be conducted and compared for
repeatability. The tests will be conducted after all required systems are fully
commissioned and at actual ambient and operating conditions as close as
practical to Output Rated Conditions (in the case of capacity tests) or Heat
Rate Rated Conditions (in the case of heat rate tests). HRSG blowdown will be
isolated during the tests since these flows are unmetered; however, corrections
back to design flows will be applied. If the corrected results of the two test
runs do not agree within 0.25%, then the cause of the discrepancy will be
investigated, eliminated if possible, and a third test performed. If the results
of all tests vary by more than 0.25% from the mean of all tests, then the
results of all three tests will be averaged. If one test varies by more than
0.25% from the mean of the other two tests, then its results will be discarded
and the results of the other two will be averaged.
B. PEAKER PROJECTS
To be agreed between the Borrower and the Independent Engineer and Environmental
Consultant (acting on the instructions of the Majority Lenders) with respect to
each Subsequent Project which is a Peaker on or prior to the first Utilization
relating thereto.
RELIABILITY TEST
A. COMBINED-CYCLE PROJECTS
The Borrower will conduct a 7-day reliability test which is intended to
demonstrate that each of the Harris 1 Project, the Harris 2 Project, the
Franklin 1 Project, the Franklin 2 Project and the Wansley Project (and any
other Subsequent Project which is a combined-cycle electric generation plant)
are capable of continuous, reliable operation at various load points. The
reliability test shall be conducted during a continuous 168-hour period during
which the relevant Project shall demonstrate the following requirements:
o Achieve an Equivalent Availability Factor (as calculated by the North
American Electric Reliability Council) of at least 97 percent;
o During such test, the Project shall operate for 124 or more hours at
the mode of operation applicable to either the Guaranteed Output or the
Guaranteed Heat Rate for such Project, provided that the Project shall
operate (a) for at least 24 hours in the mode of operation applicable
to the Guaranteed Output for such Project, if ambient conditions allow;
and (b) for at least 6 continuous hours in the mode of operation
applicable to the Guaranteed Output for such Project;
o During the reliability test, data will be recorded from plant
instrumentation at one-hour intervals (ambient conditions recorded
manually if necessary);
o All plant emissions shall be recorded by the plant CEMS during the
reliability test;
o During the reliability test, the Project shall be operated in
accordance with prudent utility practice and all laws, permits and
regulations applicable to such Project (including, without limitation,
all emissions requirements imposed by the Project's air permit); and
o The facility controls shall be placed in an "automatic mode" to an
extent consistent with normal operating practice, and manual control of
facility equipment and systems shall be minimized. Operating personnel
shall be staffed consistent with normal operating plans.
B. PEAKER PROJECTS
To be agreed between the Borrower and the Independent Engineer and Environmental
Consultant (acting on the instructions of the Majority Lenders) with respect to
each Subsequent Project which is a Peaker on or prior to the first Utilization
relating thereto.
EXHIBIT A
AMENDED AND RESTATED
CREDIT AGREEMENT
FORM OF NOTE
PROMISSORY NOTE
U.S.$_______________ Dated: _______________, _____
FOR VALUE RECEIVED, the undersigned, SOUTHERN POWER COMPANY, a
Delaware corporation (the "Borrower"), HEREBY PROMISES TO PAY to
_________________________ (the "Lender") for the account of its Applicable
Lending Office on the Final Maturity Date (each as defined in the Credit
Agreement referred to below) the principal sum of U.S.$[amount of the Lender's
Commitment in figures] or, if less, the aggregate outstanding principal amount
of the Advances made by the Lender to the Borrower pursuant to the Amended and
Restated Credit Agreement dated as of April 17, 2003 among the Borrower, the
Lender and certain other financial institutions parties thereto and Citibank,
N.A., as Agent for the Lender and such other financial institutions (as amended
or modified from time to time, the "Credit Agreement"; the terms defined therein
being used herein as therein defined) outstanding on the Final Maturity Date.
The Borrower promises to pay interest on the unpaid principal
amount of each Advance from the date of such Advance until such principal amount
is paid in full, at such interest rates, and payable at such times, as are
specified in the Credit Agreement.
Both principal and interest are payable in lawful money of the
United States of America to Citibank, N.A., as Agent, at 2 Penns Way, Suite 200,
New Castle, DE 19720, Attention: Dave Graber, in same day funds. Each Advance
owing to the Lender by the Borrower pursuant to the Credit Agreement, and all
payments made on account of principal thereof, shall be recorded by the Lender
and, prior to any transfer hereof, endorsed on the grid attached hereto which is
part of this Promissory Note.
This Promissory Note is one of the Notes referred to in, and
is entitled to the benefits of, the Credit Agreement. The Credit Agreement,
among other things, (i) provides for the making of Advances by the Lender to the
Borrower from time to time in an aggregate amount not to exceed at any time
outstanding the Dollar amount first above mentioned, the debt of the Borrower
resulting from each such Advance being evidenced by this Promissory
Note; and (ii) contains provisions for acceleration of the
maturity hereof upon the happening of certain stated events and also for
prepayments on account of principal hereof prior to the maturity hereof upon the
terms and conditions therein specified.
SOUTHERN POWER COMPANY
By:
---------------------------
Title:
ADVANCES AND PAYMENTS OF PRINCIPAL
- ------------------ ---------------- --------------- -------------------- ------------------- ------------------ -----------------
Amount of
Amount of Category of Project (if Principal Paid Unpaid Principal Notation
Date Advance Advance applicable)1 or Prepaid Balance Made By
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- -----------------------
1 Insert name of Project, unless Working Capital Advance.
EXHIBIT B
AMENDED AND RESTATED
CREDIT AGREEMENT
FORM OF NOTICE OF UTILIZATION
Citibank, N.A., as Agent
for the Lenders parties
to the Credit Agreement
referred to below
2 Penns Way
Suite 200
New Castle, DE 19720
Attention: Dave Graber
[Date]
Attention: ____________________
Ladies and Gentlemen:
The undersigned, SOUTHERN POWER COMPANY, refers to the Amended
and Restated Credit Agreement, dated as of April 17, 2003 (as amended or
modified from time to time, the "Credit Agreement", the terms defined therein
being used herein as therein defined), among the undersigned, certain financial
institutions parties thereto and CITIBANK, N.A., as Agent for said financial
institutions, and hereby gives you notice, irrevocably, pursuant to Article II
of the Credit Agreement that the undersigned hereby requests a Utilization under
the Credit Agreement, and in that connection sets forth below the information
relating to such Utilization (the "Proposed Utilization") as required by Section
2.02(a) (if the Proposed Utilization is to be a Borrowing) or 2.15 (if the
Proposed Utilization is to be a CP Commitment Reservation) of the Credit
Agreement, as the case may be:
(a) The Proposed Utilization shall consist of a [Borrowing in
the aggregate amount of $_______________] / [CP Commitment Reservation
in the aggregate amount of $_______________, and is being made with
respect to Commercial Paper in an aggregate principal amount equal to
such amount which will be issued on or after the date of the Proposed
Utilization]*.
(b) The Business Day of the Proposed Utilization is
_______________, ____.
________________________
* Include only if Utilization is CP Commitment Reservation.
[(c) [The Type of Advances comprising the Proposed Utilization
is [Base Rate Advances] / [Eurodollar Rate Advances].] The initial
Interest Period for each Eurodollar Rate Advance made as part of the
Proposed Utilization is __________ month[s].]**
(d) The aggregate principal amount of all outstanding Advances
and the unused Commitments and CP Commitments, in each case, with
respect to the Project(s) relating to the Proposed Utilization, before
and after giving effect to the Proposed Utilization, are as follows:
- ---------------- --------------- -------------- ----------------------------------- ----------------------------------
Outstanding Utilizations Outstanding Utilizations After
Before Proposed Utilization Proposed Utilization
Estimated
Aggregate Aggregate Aggregate CP Aggregate Aggregate CP
Project Project Costs Project Limit Borrowings Commitments Borrowings Commitments
- ---------------- --------------- -------------- --------------- ------------------- --------------- ------------------
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[(e) The Advances comprising the Proposed Utilization are
Project Advances, the proceeds of which are to [(i)] finance Project
Costs in the following amounts with respect to the following
Project(s):
- -------------- ------------------ ------------------ --------------------
Project(s) Aggregate Project Costs Project
Project Costs to be Costs to be
Funded by Funded with
Proposed Equity
Utilization Contributions
- -------------- ------------------ ------------------ --------------------
- -------------- ------------------ ------------------ --------------------
- -------------- ------------------ ------------------ --------------------
- -------------- ------------------ ------------------ --------------------
- -------------- ------------------ ------------------ --------------------
[[and][or] (ii)] repay Affiliate Subordinated Debt incurred to
pay Project Costs in the following amounts with respect to the
following Projects:
__________________________
** Include only if Utilization is Borrowing.
- ----------- ------------ --------------- ---------------------- ----------------
Project(s) Aggregate Affiliated Project Costs Project
Project Subordinated Funded Costs Funded
Costs Debt to by Advances with Equity
be Repaid by (including Proposed Contributions
Proposed Utilization)
Utilization
- ----------- ------------ --------------- ---------------------- ----------------
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]]; OR
[(e) The Advances comprising the Proposed Utilization are CP
Advances in the following amounts, the proceeds of which are to repay
Commercial Paper issued with respect to the following Project(s) in
connection with the CP Commitment Reservation(s) established on the
following dates for such Project(s):
- ------------ --------------- ------------------ --------------- ----------------
Project(s) Aggregate Aggregate Amount Amount(s) and Project Costs
Project Costs of CP Advances Date(s) of CP Funded
Commitment with Equity
Reservation Contributions
- ------------ --------------- ------------------ --------------- ----------------
- ------------ --------------- ------------------ --------------- ----------------
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]; OR
[(e) The Advances comprising the Proposed Utilization are
Working Capital Advances.
]; OR
[(e) The Proposed Utilization is a CP Commitment (Refinancing
CP) Reservation which is to be made with respect to Refinancing
Commercial Paper the proceeds of which are to be used to repay Project
Advances in the following amounts with respect to the following
Project(s):
- ------------------------- --------------------------------------------
Project(s) Aggregate Amount(s)and Date(s)
of Project Advances
- ------------------------- --------------------------------------------
- ------------------------- --------------------------------------------
- ------------------------- --------------------------------------------
- ------------------------- --------------------------------------------
- ------------------------- --------------------------------------------
]; OR
[(e) The Proposed Utilization is a CP Commitment (Original CP)
Reservation which is to be made with respect to Original Commercial
Paper, the proceeds of which are to finance Project Costs in the
following amounts with respect to the following Project(s):
- ------------ ----------- ------------------ ------------------ ----------------
Project(s) Aggregate Project Costs Project Costs to Project Costs
Project to be be Funded by to be Funded
Costs Funded by Advances with Equity
Commercial Paper (including Contributions
Proposed
Utilization)
- ------------ ----------- ------------------ ------------------ ----------------
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]; OR
[(e) The Proposed Utilization is a CP Commitment (Original CP)
Reservation which is to be made with respect to Original Commercial
Paper, the proceeds of which are to be used for the Borrower's general
corporate purposes or to provide working capital for the Borrower in
the amount of $__________________.]; OR
[(e) The Proposed Utilization is a CP Commitment (Refinancing
CP) Reservation which is to be made with respect to Refinancing
Commercial Paper, the proceeds of which are to be used to repay Working
Capital Advances in the amount of $_________________.]; OR
[(e) The Proposed Utilization is a CP Commitment (Original CP)
Reservation which is to be made with respect to Original Commercial
Paper, the proceeds of which are to be used to allow the Borrower to
make a Restricted Payment or repay Affiliate Subordinated Debt issued
for such purpose, in each case as permitted under this Agreement in the
aggregate amount of $__________________.]; OR
[(e) The Advances comprising the Proposed Utilization are CP
Advances in the amount of $___________, the proceeds of which are to
repay (i) Commercial Paper issued for the Borrower's general corporate
purposes or to provide working capital for the Borrower, or (ii)
Affiliate Subordinated Debt issued by the Borrower to repay Commercial
Paper issued for such purpose, in each case in connection with the
following CP Commitment Reservation(s):
- ------------------------------------------------------------ ---------------------------------------------------------
Purpose Amount(s) and Date(s) of CP Commitment Reservation
- ------------------------------------------------------------ ---------------------------------------------------------
- ------------------------------------------------------------ ---------------------------------------------------------
(1) Repay Commercial Paper
- ------------------------------------------------------------ ---------------------------------------------------------
- ------------------------------------------------------------ ---------------------------------------------------------
(2) Repay Affiliate Subordinated Debt
- ------------------------------------------------------------ ---------------------------------------------------------
.]; OR
[(e) The Advances comprising the Proposed Utilization are CP
Advances in the amount of $___________, the proceeds of which are to
repay (i) Commercial Paper issued to allow the Borrower to make a
Restricted Payment or repay Affiliate Subordinated Debt issued for such
purpose, in each case as permitted under this Agreement in connection
with the CP Commitment Reservations established on the following dates
for such purposes:
- --------------------------------------------- --------------------------------- ---------------------------------------
Purpose Aggregate Amount of CP Advances Amount(s) and Date(s) of CP
Commitment Reservation
- --------------------------------------------- --------------------------------- ---------------------------------------
- --------------------------------------------- --------------------------------- ---------------------------------------
(1) Fund Restricted Payments
- --------------------------------------------- --------------------------------- ---------------------------------------
- --------------------------------------------- --------------------------------- ---------------------------------------
(2) Repay Affiliate Subordinated Debt
issued for such purpose
- --------------------------------------------- --------------------------------- ---------------------------------------
.]; and
(f) The Proposed Utilization will not result in the applicable
Borrowing Limit(s) to be exceeded or in the aggregate principal amount
of all outstanding Advances and CP Commitment Reservations (including
the Proposed Utilization) to exceed $650,000,000.
The undersigned hereby certifies that on the date hereof and
on the date of the Proposed Utilization the representations and warranties
contained in Section 4.01 of the Credit Agreement [(except those contained in
Sections 4.01(h) and (j)) and all representations and warranties contained in
Sections 4 and 2 of the Southern Completion Guarantee and the Southern Equity
Agreement (other than Sections 4(f) and (h) and 2(f) and (h), respectively)]*
are or will be, as the case may be, correct [in all material respects]**, before
and after giving effect to the Proposed Utilization and to the application of
___________________________
* Include only to the extent required under Section 3.03, 3.05, 3.06(b), (c),
(e) or (f) or 3.07.
** Include unless Utilization is on Funds Availability Date.
the proceeds therefrom (or, if the Proposed Utilization is a CP Commitment
Reservation, after giving effect to the application of the proceeds of the
Commercial Paper for which such CP Commitment Reservation is being requested),
as though made on and as of such date.
Very truly yours,
SOUTHERN POWER COMPANY
By:
-------------------------------------------------
Title:
EXHIBIT C
AMENDED AND RESTATED
CREDIT AGREEMENT
FORM OF ASSIGNMENT AND ACCEPTANCE
Reference is made to the Amended and Restated Credit Agreement
dated as of April 17, 2003 (as amended or modified from time to time, the
"Credit Agreement") among SOUTHERN POWER COMPANY, a Delaware corporation (the
"Borrower"), certain financial institutions parties thereto and CITIBANK, N.A.,
as agent for said financial institutions (the "Agent"). Terms defined in the
Credit Agreement are used herein with the same meaning.
The "Assignor" and the "Assignee" referred to on Schedule 1
hereto agree as follows:
1. The Assignor hereby sells and assigns to the Assignee, and the Assignee
hereby purchases and assumes from the Assignor, an interest in and to the
Assignor's rights and obligations under the Credit Agreement as of the date
hereof equal to the percentage interest specified on Schedule 1 hereto.
After giving effect to such sale and assignment, the Assignee's Commitment,
CP Commitment and the amount of the Advances (and Categories thereof) owing
to the Assignee will be as set forth on Schedule 1 hereto.
2. The Assignor (i) represents and warrants that it is the legal and
beneficial owner of the interest being assigned by it hereunder and that
such interest is free and clear of any adverse claim; (ii) makes no
representation or warranty and assumes no responsibility with respect to
any statements, warranties or representations made in or in connection with
the Credit Agreement or the execution, legality, validity, enforceability,
genuineness, sufficiency or value of the Credit Agreement or any other
instrument or document furnished pursuant thereto; (iii) makes no
representation or warranty and assumes no responsibility with respect to
the financial condition of the Borrower, Southern or any Subsidiary of the
Borrower or Southern, or the performance or observance by any of the
Borrower, Southern or any Subsidiary of the Borrower or Southern, or any
other party, of any of its obligations under the Credit Agreement and the
other Material Documents to which it is a party, or any other instrument or
document furnished pursuant thereto; and (iv) attaches the Note held by the
Assignor and requests that the Agent exchange such Note for a new Note
payable to the Assignee in an amount equal to the Commitment assumed by the
Assignee pursuant hereto or new Notes payable to the Assignee in an amount
equal to the Commitment assumed by the Assignee pursuant hereto and the
Assignor in an amount equal to the Commitment retained by the Assignor
under the Credit Agreement, respectively, as specified on Schedule 1
hereto.
3. The Assignee (i) confirms that it has received a copy of the Credit
Agreement, together with copies of the financial statements referred to in
Section 4.01 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; (ii) agrees that it will,
independently and without reliance upon the Agent, the Assignor or any
other Lender and based on such documents and information as it shall deem
appropriate at the time, continue to make its own credit decisions in
taking or not taking action under the Credit Agreement and the other Loan
Documents; (iii) confirms that it is an Eligible Assignee or that it is an
entity that has been approved by the Borrower and the Agent to the extent
any such approval is required under Section 8.07(a) of the Credit
Agreement; (iv) appoints and authorizes the Agent to take such action as
agent on its behalf and to exercise such powers and discretion under the
Credit Agreement and the other Loan Documents as are delegated to the Agent
by the terms thereof, together with such powers and discretion as are
reasonably incidental thereto; (v) agrees that it will perform in
accordance with their terms all of the obligations that by the terms of the
Credit Agreement and the other Loan Documents are required to be performed
by it as a Lender; and (vi) attaches any U.S. Internal Revenue Service
forms required under Section 2.13 of the Credit Agreement.
4. Following the execution of this Assignment and Acceptance, it will be
delivered to the Agent for acceptance and recording by the Agent. The
effective date for this Assignment and Acceptance (the "Effective Date")
shall be the date of acceptance hereof by the Agent, unless otherwise
specified on Schedule 1 hereto.
5. Upon such acceptance and recording by the Agent, as of the Effective Date,
(i) the Assignee shall be a party to the Credit Agreement and, to the
extent provided in this Assignment and Acceptance, have the rights and
obligations of a Lender thereunder and (ii) the Assignor shall, to the
extent provided in this Assignment and Acceptance, relinquish its rights
and be released from its obligations (other than under Sections 2.13(f),
8.07(g) and 8.08) under the Credit Agreement.
6. Upon such acceptance and recording by the Agent, from and after the
Effective Date, the Agent shall make all payments under the Credit
Agreement and the Notes in respect of the interest assigned hereby
(including all payments of principal, interest and commitment fees with
respect thereto) to the Assignee. The Assignor and Assignee shall make all
appropriate adjustments in payments under the Credit Agreement and the
Notes for periods prior to the Effective Date directly between themselves.
7. This Assignment and Acceptance shall be governed by, and construed in
accordance with, the Laws of the State of New York.
8. This Assignment and Acceptance may be executed in any number of
counterparts and by different parties hereto in separate counterparts, each
of which when so executed shall be deemed to be an original and all of
which taken together shall constitute one and the same agreement. Delivery
of an executed counterpart of Schedule 1 to this Assignment and Acceptance
by telecopier shall be effective as delivery of a manually executed
counterpart of this Assignment and Acceptance.
IN WITNESS WHEREOF, the Assignor and the Assignee have caused
Schedule 1 to this Assignment and Acceptance to be executed by their officers
duly authorized for such purpose, as of the date specified thereon.
[NAME OF ASSIGNOR], as Assignor
By:
-------------------------------------------------
Title:
Dated: _______________, ____
[NAME OF ASSIGNEE], as Assignee
By:
-------------------------------------------------
Title:
Domestic Lending Office:
[Address]
Eurodollar Lending Office:
[Address]
Accepted this __________ day of _______________, ____
CITIBANK, N.A., as Agent
By: _____________________
Title:
By: _____________________
Title:
**Agreed this ___ day of ________, ____
SOUTHERN POWER COMPANY
By: _____________________
Title:
- ---------------------
** Include if Borrower's consent is required.
Schedule 1
to
Assignment and Acceptance
1. Percentage interest assigned: _____%
2. Commitments
(a) Assignee's Commitment: $_______________
(b) Assignee's CP Commitment $_______________
3. Outstanding Advances
(a) Aggregate outstanding principal amount of Project Advances
assigned: $_______________
(b) Aggregate outstanding principal amount of CP
Advances assigned: $_______________
(c) Aggregate outstanding principal amount of
Working Capital Advances assigned: $_______________
4. Principal amount of Note payable to Assignee: $_______________
5. Principal amount of Note payable to Assignor: $_______________
6. Effective Date*: _______________, _____
________________________
* This date should be no earlier than five (5) Business Days after the
delivery of this Assignment and Acceptance to the Agent.
EXHIBIT D
AMENDED AND RESTATED
CREDIT AGREEMENT
[Intentionally Omitted]
EXHIBIT E
AMENDED AND RESTATED
CREDIT AGREEMENT
FORM OF OPINIONS OF COUNSEL FOR THE LOAN PARTIES
EXHIBIT F
AMENDED AND RESTATED
CREDIT AGREEMENT
DESIGNATION AGREEMENT
Dated
Reference is made to that certain Amended and Restated Credit
Agreement dated as of April 17, 2003 (as amended, supplemented or otherwise
modified from time to time, the "Credit Agreement") by and among SOUTHERN POWER
COMPANY, the Lenders parties thereto and CITIBANK, N.A., as Agent. Terms defined
in the Credit Agreement are used herein with the same meaning.
[NAME OF DESIGNATING LENDER] (the "Designating Lender"), [NAME
OF DESIGNEE] (the "Designee") and the Agent agree as follows:
1. Pursuant to Section 8.07(i) of the Credit Agreement, the
Designating Lender hereby designates the Designee, and the Designee
hereby accepts such designation, to have a right to make Advances
pursuant to Article II of the Credit Agreement. Any delegation by
Designating Lender to Designee of its rights to make an Advance
pursuant to such Article II shall be effective at the time of the
funding of such Advance and not before such time.
2. Except as set forth in Section 7 below, the Designating
Lender makes no representation or warranty and assumes no
responsibility pursuant to this Designation Agreement with respect to
(a) any statements, warranties or representations made in or in
connection with the Credit Agreement or any document related thereto
(each, a "Loan Document") or the execution, legality, validity,
enforceability, genuineness, sufficiency or value of any Loan Document
or any other instrument and document furnished pursuant thereto; and
(b) the financial condition of the Borrower or Southern or any other
party or the performance or observance by the Borrower or Southern or
any other party of any of its obligations under any Loan Document or
other Material Document to which it is a party or any other instrument
or document furnished pursuant thereto.
3. The Designee (a) confirms that it has received a copy of
each Loan Document, together with copies of the financial statements
referred to in Article IV of the Credit Agreement and such other
documents and information as it has deemed appropriate to make its own
credit analysis and decision to enter into this Designation Agreement;
(b) agrees that it will independently and without reliance upon the
Agent, any Arranger, the Designating Lender or any other Lender and,
based on such documents and information as it shall deem appropriate at
the time, continue to make its own credit decisions in taking or not
taking action under any Loan Document; (c) confirms that it is a
Designated Lender; (d) appoints and authorizes the Agent to take such
action as Agent on its behalf and to exercise such powers and
discretion under any Loan Document as are delegated to the Agent by the
terms thereof, together with such powers and discretion as are
reasonably incidental thereto; and (e) agrees that it will perform in
accordance with their terms all of the obligations which by the terms
of any Loan Document are required to be performed by it as a Lender.
4. The Designee hereby appoints Designating Lender or a
specified branch or affiliate of Designating Lender as Designee's agent
and attorney in fact and grants to Designating Lender or a specified
branch or affiliate of Designating Lender an irrevocable power of
attorney to receive payments made for the benefit of Designee under the
Loan Documents, to deliver and receive all communications and notices
under the Credit Agreement and other Loan Documents and to exercise on
Designee's behalf all rights to vote and to grant and make approvals,
waivers, consents and amendments to or under the Credit Agreement or
other Loan Documents. Designee shall not have any right to approve any
waiver or amendment of the Credit Agreement, any Note or any other Loan
Document, or any consent to any departure by the Borrower or Southern
therefrom, except to the extent that such waiver, amendment or consent
would reduce the principal of, or interest on, the Notes or any fees or
any other amounts payable under any Loan Document or postpone any date
fixed for any payment of principal of, or interest on, the Notes or any
fees or any other amounts payable under any Loan Document. Any document
executed by such agent on the Designee's behalf in connection with the
Credit Agreement or other Loan Documents shall be binding on the
Designee. The Borrower, the Agent and each of the Lenders may rely on
and are beneficiaries of the preceding provisions.
5. Following the execution of this Designation Agreement by
the Designating Lender and its Designee, it will be delivered to the
Agent for acceptance and recording by the Agent. The effective date for
this Designation Agreement (the "Effective Date") shall be the date of
acceptance hereof by the Agent, unless otherwise specified on the
signature page of this Designation Agreement.
6. Each of the Designating Lender and the Agent hereby (a)
acknowledges that the Designee is relying on the non-petition
provisions of Section 8.12 of the Credit Agreement as agreed to by all
signatories thereto; and (b) reaffirms that it will not institute
against the Designee or join any other Person in instituting against
the Designee any bankruptcy, reorganization, arrangement, insolvency or
liquidation proceedings under any federal or state bankruptcy or
similar law for one year and one day after the payment in full of the
latest maturing commercial paper note issued by the Designee.
7. The Designating Lender unconditionally agrees to pay or
reimburse the Designee and save the Designee harmless against all
liabilities, obligations, losses, damages, penalties, actions,
judgments, suits, costs, expenses, or disbursements of any kind or
nature whatsoever which may be imposed or asserted by any of the
parties to the Loan Documents against the Designee, in its capacity as
such, in any way relating to or arising out of this Designation
Agreement or any Loan Documents or any action taken or omitted by the
Designee hereunder or thereunder; provided that the Designating Lender
shall not be liable for any portion of such liabilities, obligations,
losses, damages, penalties, actions, judgments, suits, costs, expenses
or disbursements if the same results from the Designee's gross
negligence or willful misconduct.
8. Upon such acceptance and recording by the Agent, as of the
Effective Date, the Designee shall be a party to the Credit Agreement
with a right to make Advances as a Designated Lender pursuant to
Article II of the Credit Agreement and the rights and obligations of a
Designated Lender related thereto; provided that the Designee shall not
be required to make payments with respect to such obligations except to
the extent of excess cash flow of the Designee which is not otherwise
required to repay obligations of the Designee Lender which are then due
and payable. Notwithstanding the foregoing, the Designating Lender or a
specified branch or affiliate of Designating Lender, as administrative
agent for the Designee, shall be and remain obligated to the Borrower,
the Agent and the Lenders for each and every of the obligations of the
Designee and the Designating Lender with respect to the Credit
Agreement, including any indemnification obligations under Section 7.05
of the Credit Agreement and any sums otherwise payable to any Loan
Party by the Designee.
9. This Designation Agreement shall be governed by and
construed in accordance with the Laws of the State of New York.
10. This Designation Agreement may be executed in any number
of counterparts and by different parties hereto in separate
counterparts, each of which when so executed shall be deemed to be an
original and all of which taken together shall constitute one and the
same agreement. Delivery of an executed counterpart of a signature page
to this Designation Agreement by facsimile transmission shall be
effective as delivery of a manually executed counterpart of this
Designation Agreement.
IN WITNESS WHEREOF, the Designating Lender and the Designee
intending to be legally bound, have caused this Designation Agreement to be
executed by their officers duly authorized for such purpose, as of the date
first above written.
[NAME OF DESIGNATING LENDER],
as Designating Lender
By:
Name:
Title:
[NAME OF DESIGNEE], as Designee
By:
Name:
Title:
Lending Office
(and address for notices):
Accepted this __ day of ________, ____ Effective Date:
CITIBANK, N.A.
as Agent
By:
-----------------------------------------------
Name:
Title:
EXHIBIT I-1
AMENDED AND RESTATED
CREDIT AGREEMENT
[Intentionally Omitted]
EXHIBIT I-2
AMENDED AND RESTATED
CREDIT AGREEMENT
[Letterhead of R.W. Beck, Inc.]
[Date of Initial Borrowing
for relevant Subsequent Project]
Citibank, N.A.
388 Greenwich Street, 20th Floor
New York, New York 10013
(as Agent for the Lenders)
Subject: Independent Engineer's Report
Southern Power Company Subsequent Project(s)
Ladies and Gentlemen:
This letter is furnished pursuant to Section [3.04(a)(iv)(C)]
/ [3.04(b)(v)(C)] / [3.06(d)] of the Amended and Restated Credit Agreement dated
as of April 17, 2003 (the "Credit Agreement") by and among Southern Power
Company (the "Borrower"), Citibank, N.A. (the "Agent"), Citigroup Global Markets
Inc., as Lead Arranger, the Co-Arrangers and the financial institutions named
therein (the "Lenders"). Capitalized terms used in this letter and not otherwise
defined herein shall have the respective meanings specified in the Credit
Agreement.
R. W. Beck, Inc. (the "Independent Engineer") has been
retained by the Agent, on behalf of the Lenders, as the Independent Engineer and
it has prepared an Independent Engineer's Report dated _______ __, ____ (the
"Report") relating to the [insert name(s) of Subsequent Project(s)](the
"Subsequent Project(s)"), a copy of which is attached as Annex A.
The Report was prepared pursuant to the scope of services
under our Professional Services Agreement with the Agent on behalf of the
Lenders and those services were provided in accordance with generally accepted
engineering practices.
In connection with the preparation of the Report, personnel of
the Independent Engineer have participated in meetings or telephone discussions
with representatives of the Borrower[, counsel to the Borrower, the Agent, and
counsel to the Agent] in regard to the Subsequent Project(s).
Based on our review of the information made available to us by
the Borrower on the Subsequent Project(s) as of the date of the Report, we have
noted, among other things as set forth in the Report, certain observations and
have arrived at certain conclusions regarding the design, technical provisions
of the agreements and other aspects of the Subsequent Project(s) as set forth
below. The Agent and the Lenders are encouraged to read the Report in its
entirety for the purpose of understanding the following observations and
conclusions:
1. Each of the Subsequent Projects, from a technical and engineering
perspective, appears to have been, or is expected to be, designed by
Southern Company Services, Inc. ("SCS") in accordance with prudent industry
standards and practices for similar plants.
2. SCS has demonstrated experience in the design, engineering, procurement,
and construction of power plants similar to each of the Subsequent
Projects. [An affiliate of Southern Company] has demonstrated experience in
the operation of power plants similar to each of the Subsequent Projects.
3. The major components of each of the Subsequent Projects (including, without
limitation, the turbines, generators, and heat recovery steam generators)
are identical to the components incorporated in one or more of the Initial
Projects.
4. Each of the Subsequent Projects utilizes sound technology and proven
methods of electric generation in accordance with generally accepted
industry practice. If operated and maintained consistent with generally
accepted industry practices, each of the Subsequent Projects should be
capable of meeting: (1) the heat rate, output, and availabilities assumed
in its Project Base Case Projections as set forth in Section [ ] of the
Report; (2) the requirements set forth in each Power Purchase Agreement (if
any) entered into with respect to such Subsequent Project and referred to
in Section [ ] of the Report (collectively, the "Relevant Power Purchase
Agreements"); and (3) the requirements of the major permits and approvals
required for the construction and operation of each of the Subsequent
Projects (the "Project Permits").
5. The performance tests used, or to be used, to determine whether each of
Substantial Completion and Final Completion with respect to each of the
Subsequent Projects has been achieved are (a) consistent with the testing
procedures set forth in, or determined pursuant to, Schedule V of the
Credit Agreement; (b) similar to performance test programs conducted for
electric generating plants of the type and size of such Subsequent Project
with which we are familiar; (c) adequate for demonstrating the capability
of the Subsequent Project(s) to meet the Guaranteed Heat Rate, Guaranteed
Output, and the air emissions requirements under the Project Permits, in
each case, applicable thereto; and (d) consistent with the testing
procedures set forth in the Relevant Power Purchase Agreements.
6. The construction schedule applicable to each of the Subsequent Projects, as
determined pursuant to the major equipment supply contracts and major
construction contracts, is consistent with (a) the Scheduled Completion
Date, as set forth in the Project Schedule for that Subsequent Project; and
(b) the requirements under all Relevant Power Purchase Agreements entered
into with respect to such Subsequent Project. The performance guarantees
applicable to each of the Subsequent Projects, as contained in the major
equipment supply contracts and major construction contracts are consistent
with (i) the Guaranteed Output and Guaranteed Heat Rate applicable thereto,
each as set forth in the Project Schedule for that Subsequent Project; and
(ii) all corresponding performance guarantees in all Relevant Power
Purchase Agreements entered into with respect to such Subsequent Project.
7. Upon achievement of Substantial Completion, the [proposed] design of each
of the Subsequent Projects was, or will be, consistent with the obligations
relating to performance of such Subsequent Project under the Relevant Power
Purchase Agreements applicable thereto.
8. Set out in Sections [ ] and [ ] of the Report is a description of each
material project contract for the construction (if applicable), operation
and maintenance of each of the Subsequent Projects, including, without
limitation, all equipment supply contracts with respect to major components
and construction contracts (if such Subsequent Project is not a Completed
Project), interconnection contracts, contracts for the supply and
transportation of fuel (unless one or more of the Relevant Power Purchase
Agreements have been entered into with respect to the entire output of such
Subsequent Project, and the purchaser(s) thereunder are solely responsible
for fuel supply and transportation), the supply and discharge of water and
the operation and maintenance of such Subsequent Project, and long term
service contract(s) with respect to turbines and generators, in each case,
in existence as of the date hereof (with respect to each of the Subsequent
Projects, the "Project Contracts"). The term and technical and pricing
provisions of the Project Contracts with respect to each of the Subsequent
Projects have been taken into consideration in the preparation of the
Project Base Case Projections.
9. Set out in Section [ ] of the Report is a list and brief description of the
Project Permits. Although all Project Permits have not been obtained to
date, some of which cannot be obtained until a respective project is ready
to operate, we are not aware of any technical or engineering circumstances
that would prevent the issuance of the remaining Project Permits. The
technical provisions of the Project Permits with respect to each of the
Subsequent Projects have been taken into consideration in the preparation
of the Project Base Case Projections.
10. The Initial Project Budget for each of the Subsequent Projects includes all
Project Costs anticipated to be incurred up to Final Completion of such
Subsequent Project (including contingency). The construction cost included
in the Initial Project Budget has been developed in accordance with
generally accepted estimating practices and is comparable to the like costs
of other projects similar in size and technology with which we are
familiar.
11. The Project Base Case Projections for each of the Subsequent Projects (a)
incorporate the forecasted prices for electricity and fuel provided to us
by the Independent Market Consultant applicable to such Subsequent Project;
(b) incorporate assumptions regarding heat rates, outputs and
availabilities that we believe to be achievable; and (c) include the
assumption (as agreed between the Borrower and the Lenders) that the debt
referred to in such Project Base Case Projections has a term of 20 years
and that such debt will bear interest at the rate of 8.25% per annum
throughout its term.
12. Environmental site assessments for each of the Subsequent Projects
performed by [Insert name of environmental consultant that performed
assessment] were conducted in a manner consistent with industry standards,
using comparable industry protocols for similar studies with which we are
familiar. The results of the environmental site assessments with respect to
each of the Subsequent Projects have been taken into consideration in the
preparation of the Project Base Case Projections.
For purposes of this letter, the Independent Engineer has, at
the request of the Agent, carried out certain limited procedures for the period
commencing ____________ ___, ___ [Insert the date one day after the date of the
Report] and ending on____________ ___, ___ [Insert the date of this
certificate], consisting solely of the making of inquiries of the Borrower as to
whether there has been any material change in the information provided by them,
and upon which the Independent Engineer relied, for purposes of the Report.
These procedures would not be sufficient under generally accepted engineering
practices to enable the Independent Engineer to express an opinion as to the
matters covered by the Report and would not necessarily reveal matters of
significance with respect to the statement in the last sentence of this
paragraph. The Independent Engineer, therefore, expresses no opinion as to the
matters covered by the Report as of any date subsequent to the date of the
Report and makes no representations as to the sufficiency of the foregoing
procedures for the Agent's purposes. Nothing has come to the attention of the
Independent Engineer as a result of the foregoing procedures, however, that
caused the Independent Engineer to believe that, as of the date to which the
procedures were carried out, the opinions of the Independent Engineer set forth
in the Report were not correct.
This letter is solely for the information of, and assistance
to, the Agent and the Lenders in conducting and documenting their investigation
of the matters covered by the Report in connection with the Subsequent
Project(s) and is not to be used, circulated, quoted, or otherwise referred to
within or without the lending group for any purpose, nor is it to be referred to
in whole or in part in any other document, except that reference may be made to
it in the above-mentioned Credit Agreement or in any list of closing documents
pertaining to the Subsequent Project(s).
The Independent Engineer disclaims any obligation to update
this letter. This letter is not intended to, and may not, be relied upon by any
party other than the Agent and the Lenders.
Very truly yours,
R. W. BECK, INC.
[Name]
Principal and Senior Director
EXHIBIT I-3
AMENDED AND RESTATED
CREDIT AGREEMENT
[Intentionally Omitted]
EXHIBIT J-1
AMENDED AND RESTATED
CREDIT AGREEMENT
[Intentionally Omitted]
EXHIBIT J-2
AMENDED AND RESTATED
CREDIT AGREEMENT
[Letterhead of Marsh USA Inc.]
[Date of initial Borrowing
for relevant Subsequent Project]
The Lenders referred to below and
Citibank, N.A. (as Agent for such Lenders)
Ladies and Gentlemen:
We refer to the Amended and Restated Credit Agreement dated as of April 17, 2003
(as amended, amended and restated, supplemented or otherwise modified from time
to time, the "Credit Agreement") by and among Southern Power Company (the
"Borrower"), Citigroup Global Markets Inc., as Lead Arranger, the Co-Arrangers
and Lenders party thereto and Citibank, N.A., as administrative agent (the
"Agent") for the Lenders. Defined terms used in this certificate and not
otherwise defined herein shall have the respective meanings specified in the
Credit Agreement.
The undersigned, a duly authorized representative of Marsh USA Inc. (the
"Insurance Consultant"), hereby certifies that:
1. This certificate is delivered pursuant to Section [3.04(a)(iv)(D)] /
[3.04(b)(v)(D)] / [3.06(d)] of the Credit Agreement.
2. In connection with the Credit Agreement, the Insurance Consultant has
been retained to prepare the Independent Insurance Consultant's Report
dated [________] (the "Report") relating to [insert name(s) of
Subsequent Project(s)] (each a "Subsequent Project"), a true and
correct copy of which is attached hereto as Annex A. The Report
represents the Insurance Consultant's professional opinion as of the
date thereof and was prepared in accordance with generally accepted
practices for independent insurance consulting and with the standards
of care practiced by leading independent insurance consultants in
performing similar tasks on like projects and financings.
3. The Insurance Consultant acknowledges that pursuant to the Credit
Agreement, the Lenders will be providing financing to the Borrower for
the acquisition, development, construction, operation and/or
maintenance of each Subsequent Project.
4. After due inquiry, we hereby confirm that since the date of the Report,
no event or circumstance has occurred which:
(a) makes, as of the date hereof, any material information or
material statement contained in the Report, read as a whole,
untrue or incorrect; or
(b) should be reflected in the Report in order to make the
statements and information contained therein, read as a whole
and in light of the circumstances under which they were made,
not misleading; or
(c) results, as of the date hereof, in the Report, read as a
whole, omitting to state any material matter relevant to the
insurance program for, or insurable events, losses or
casualties relating to, the Subsequent Projects.
5. We have reviewed the insurance program put in place by the Borrower to
insure the Subsequent Projects and conclude that (a) the insurance
coverages (including, without limitation, the types and amounts of
insurances, the risks insured against, and the limits, deductibles,
exclusions and excesses applicable to such insurances) are consistent with
the customs and practices of the utility power industry in the United
States, and (b) such insurance program is maintained with insurance
companies and underwriters which are customarily used by the utility power
industry in the United States to insure against the relevant risks, and the
use of all such insurance companies and underwriters in accordance with
such insurance program is appropriate (taking into account all applicable
coverages under the relevant policies).
6. This certificate is solely for the information of, and assistance to,
Citibank, N.A. as Agent and the Lenders from time to time under the Credit
Agreement, and is not to be otherwise used, circulated, quoted or referred
to within any document, unless specifically consented to in writing by the
Insurance Consultant.
Marsh USA Inc.
By:
---------------------------------
Name:
Title:
EXHIBIT J-3
AMENDED AND RESTATED
CREDIT AGREEMENT
[Intentionally Omitted]
EXHIBIT K-1
AMENDED AND RESTATED
CREDIT AGREEMENT
[Intentionally Omitted]
EXHIBIT K-2
AMENDED AND RESTATED
CREDIT AGREEMENT
[Letterhead of PA Consulting, Inc.]
[Date of initial Borrowing
for relevant Subsequent Project]
The Lenders referred to below and
Citibank, N.A. (as Agent for such Lenders)
Ladies and Gentlemen:
We refer to the Amended and Restated Credit Agreement dated as of April 17, 2003
(as amended, amended and restated, supplemented or otherwise modified from time
to time, the "Credit Agreement") by and among Southern Power Company (the
"Borrower"), Citigroup Global Markets Inc., as Lead Arranger, the Co-Arrangers
and Lenders party thereto and Citibank, N.A., as administrative agent (the
"Agent") for the Lenders. Defined terms used in this certificate and not
otherwise defined herein shall have the respective meanings specified in the
Credit Agreement.
The undersigned, a duly authorized representative of PA Consulting, Inc. (the
"Independent Market Consultant"), hereby certifies that:
1. This certificate is delivered pursuant to section [3.04(a)(iv)(E)] /
[3.04(b)(v)(E)] / [3.06(d)] of the Credit Agreement.
2. In connection with the Credit Agreement, the Independent Market
Consultant has been retained to prepare the Independent Market
Consultant's Report dated [________] (the "Report") relating to [insert
name(s) of Subsequent Project(s)] (each a "Subsequent Project"), a true
and correct copy of which is attached hereto as Exhibit A. The Report
represents the Independent Market Consultant's professional opinion as
of the date thereof and was prepared in accordance with generally
accepted practices for independent market consulting and with the
standards of care practiced by leading independent market consultants
in performing similar tasks on like projects and financings.
3. The Independent Market Consultant acknowledges that pursuant to the
Credit Agreement, the Lenders will be providing financing to the
Borrower for the acquisition, development, construction, operation
and/or maintenance of each Subsequent Project.
4. After due inquiry, we hereby confirm that since the date of the Report,
no event or circumstance has occurred which:
(a) makes, as of the date hereof, any material information or
material statement contained in the Report, read as a whole,
untrue or incorrect; or
(b) should be reflected in the Report in order to make the
statements and information contained therein, read as a whole
and in light of the circumstances under which they were made,
not misleading; or
(c) results, as of the date hereof, in the Report, read as a
whole, omitting to state any material matter relevant to each
electric power market relevant to the Subsequent Projects.
5. If the Power Purchase Agreement entered into with respect to such
Subsequent Project is an EMC Contract, the projections for the
incremental requirement needs of the applicable EMC Counterparty are
reasonable.
This certificate is solely for the information of, and
assistance to, Citibank, N.A. as Agent and the Lenders from time to time under
the Credit Agreement, and is not to be otherwise used, circulated, quoted or
referred to within any document, unless specifically consented to in writing by
the Independent Market Consultant.
PA Consulting, Inc.
By:
---------------------------------
Name:
Title:
EXHIBIT K-3
AMENDED AND RESTATED
CREDIT AGREEMENT
[Intentionally Omitted]
EXHIBIT L-1
AMENDED AND RESTATED
CREDIT AGREEMENT
CERTIFICATE OF SUBSTANTIAL COMPLETION
Pursuant to that certain Amended and Restated Credit Agreement, dated
as of April 17, 2003 (as amended, supplemented or otherwise modified from time
to time in accordance with the terms thereof, the "Credit Agreement"), by and
among Southern Power Company (the "Borrower"), Citigroup Global Markets Inc., as
Lead Arranger, the Co-Arrangers and Lenders party thereto, and Citibank, N.A.,
as administrative agent for the Lenders (the "Agent"), The Southern Company
("Southern") hereby delivers this Certificate to the Agent. Except as otherwise
defined herein, capitalized terms used herein but not defined shall have the
respective meanings given to them in Exhibit A attached hereto.
Southern hereby certifies as follows:
(i) the [relevant] Project has achieved Mechanical Completion;
(ii) the [relevant] Project has passed an emissions test demonstrating
that it can operate in accordance with its permits;
(iii) the [relevant] Project has achieved at least 95% of its
Guaranteed Output as set forth in Schedule I hereto, has achieved a
heat rate not greater than 105% of its Guaranteed Heat Rate as set
forth in Schedule I hereto, in each case, pursuant to tests conducted
in accordance with Schedule V to the Credit Agreement;
(iv) the [relevant] Project has successfully completed the reliability
run required pursuant to Schedule V to the Credit Agreement;
(v) the [relevant] Project has obtained final, non-appealable permits
required to operate as designed as of the date hereof;
(vi) all necessary facilities for the transportation of natural gas to,
the necessary electric interconnect facilities for, and all necessary
facilities for the procurement, transportation and discharge of water
to and from, the [relevant] Project have been completed; and
(vii) based upon the foregoing, the [relevant] Project has achieved
Substantial Completion as of the date hereof.
Southern has caused this Certificate to be executed and delivered by its
duly authorized officer as of the _____ day of ___________, 200__.
THE SOUTHERN COMPANY
By:
--------------------------------------------
Name:
--------------------------------------------
Title:
--------------------------------------------
EXHIBIT A
Definitions
"[Relevant] Project" means the [Project description].
"Guaranteed Heat Rate" means the average heat rate associated with the
[relevant] Project while operating in [base mode (namely, at 100% combustion
turbine load)] / [ specify mode of operation applicable to Guaranteed Heat Rate
] at the rated conditions for the [relevant] Project, as set forth in Schedule I
hereto.
"Guaranteed Output" means the capability of the [relevant] Project with [all
possible modes of operation in use] / [ specify mode of operation applicable to
Guaranteed Output ] at the rated conditions for the [relevant] Project, as set
forth in Schedule I hereto.
"Mechanical Completion" means (a) all construction work for the [relevant]
Project has been completed according to the proper scope of work and the
[relevant] Project is ready for performance testing with the exception of Punch
List Items; (b) satisfactory completion of the materials and equipment
associated with individual turnover packages (with all items within the turnover
package completed to the satisfaction of the Borrower's start-up or testing
manager, all equipment capable of operation in a safe and proper manner without
voiding warranties, all equipment systems installed associated with the turnover
package, including remote control systems, ready to commence start-up and
testing) and the satisfactory completion and documentation of the construction
completion testing; and (c) all construction, temporary facilities that may
interfere with or disrupt the Borrower's start-up and plant testing activities,
waste material and rubbish have been removed from the work area.
"Punch List Items" means those incomplete work items that do not have a material
effect on the operations and maintenance of the [relevant] Project, including
painting, platforms, and damaged instrument glass.
"Substantial Completion" means (a) achievement of Mechanical Completion; (b) the
[relevant] Project has passed an emissions test demonstrating that it can
operate in accordance with its permits; (c) the [relevant] Project has achieved
at least 95% of its Guaranteed Output, has achieved a heat rate not greater than
105% of its Guaranteed Heat Rate, in each case, as set forth in Schedule I
hereto and as tested in accordance with the testing procedures applicable to the
[relevant] Project set forth in, or determined in accordance with, Schedule V to
the Credit Agreement; (d) the [relevant] Project has successfully completed the
reliability run applicable thereto, as set forth in, or determined in accordance
with, Schedule V to the Credit Agreement; (e) the [relevant] Project has
obtained final, non-appealable permits required to operate as designed as of the
date hereof; and (f) all necessary facilities for the transportation of natural
gas to, the necessary electric interconnect facilities for, and all necessary
facilities for the procurement, transportation and discharge of water to and
from, the [relevant] Project have been completed.
Schedule I
Rated Conditions
EXHIBIT L-2
AMENDED AND RESTATED
CREDIT AGREEMENT
CERTIFICATE OF FINAL COMPLETION
Pursuant to that certain Amended and Restated Credit Agreement, dated
as of April 17, 2003 (as amended, supplemented or otherwise modified from time
to time in accordance with the terms thereof, the "Credit Agreement"), by and
among Southern Power Company (the "Borrower"), Citigroup Global Markets Inc., as
Lead Arranger, the Co-Arrangers and Lenders party thereto, and Citibank, N.A.,
as administrative agent for the Lenders (the "Agent"), The Southern Company
("Southern") hereby delivers this Certificate to the Agent. Except as otherwise
defined herein, capitalized terms used herein but not defined shall have the
respective meanings given to them in Exhibit A attached hereto.
Southern hereby certifies as follows:
(i) the [relevant] Project has achieved Substantial Completion;
(ii) the tested output in megawatts for the [relevant] Project has
achieved 100% of its Guaranteed Output and the [relevant] Project has
achieved an average tested heat rate not greater than 100% of its
Guaranteed Heat Rate, in each case, as set forth in Schedule I hereto
and pursuant to tests conducted in accordance with Schedule V to the
Credit Agreement; and
(iii) based upon the foregoing, the [relevant] Project has achieved
Final Completion as of the date hereof.
Southern has caused this Certificate to be executed and delivered by
its duly authorized officer as of the _____ day of ___________, 200__.
THE SOUTHERN COMPANY
By:
--------------------------------------------
Name:
--------------------------------------------
Title:
--------------------------------------------
EXHIBIT A
Definitions
"[Relevant] Project" means the [Project description].
"Final Completion" means (a) the [relevant] Project has achieved Substantial
Completion; (b) the tested output in megawatts for the [relevant] Project has
achieved 100% of its Guaranteed Output pursuant to tests conducted in accordance
with Schedule V to the Credit Agreement; and (c) the [relevant] Project has
achieved a tested heat rate not greater than 100% of its Guaranteed Heat Rate
pursuant to tests conducted in accordance with Schedule V to the Credit
Agreement.
"Guaranteed Heat Rate" means the average heat rate associated with the
[relevant] Project while operating in [base mode (namely, at 100% combustion
turbine load)] / [ specify mode of operation applicable to Guaranteed Heat Rate
] at the rated conditions for the [relevant] Project, as set forth in Schedule I
hereto.
"Guaranteed Output" means the capability of the [relevant] Project with [all
possible modes of operation in use] / [ specify mode of operation applicable to
Guaranteed Output ] at the rated conditions for the [relevant] Project, as set
forth in Schedule I hereto.
"Mechanical Completion" means (a) all construction work for the [relevant]
Project has been completed according to the proper scope of work and the
[relevant] Project is ready for performance testing with the exception of Punch
List Items; (b) satisfactory completion of the materials and equipment
associated with individual turnover packages (with all items within the turnover
package completed to the satisfaction of the Borrower's start-up or testing
manager, all equipment capable of operation in a safe and proper manner without
voiding warranties, all equipment systems installed associated with the turnover
package, including remote control systems, ready to commence start-up and
testing) and the satisfactory completion and documentation of the construction
completion testing; and (c) all construction, temporary facilities that may
interfere with or disrupt the Borrower's start-up and plant testing activities,
waste material and rubbish have been removed from the work area.
"Punch List Items" means those incomplete work items that do not have a material
effect on the operations and maintenance of the [relevant] Project, including
painting, platforms, and damaged instrument glass.
"Substantial Completion" means (a) achievement of Mechanical Completion; (b) the
[relevant] Project has passed an emissions test demonstrating that it can
operate in accordance with its permits; (c) the [relevant] Project has achieved
at least 95% of its Guaranteed Output, has achieved a heat rate not greater than
105% of its Guaranteed Heat Rate, in each case, as set forth in Schedule I
hereto and as tested in accordance with the testing procedures applicable to the
[relevant] Project set forth in, or determined in accordance with, Schedule V to
the Credit Agreement; (d) the [relevant] Project has successfully completed the
reliability run applicable thereto, as set forth in, or determined in accordance
with, Schedule V to the Credit Agreement; (e) the [relevant] Project has
obtained final, non-appealable permits required to operate as designed as of the
date hereof; and (f) all necessary facilities for the transportation of natural
gas to, the necessary electric interconnect facilities for, and all necessary
facilities for the procurement, transportation and discharge of water to and
from, the [relevant] Project have been completed.
Schedule I
Rated Conditions
EXHIBIT M
AMENDED AND RESTATED
CREDIT AGREEMENT
[SOUTHERN COMPANY LETTERHEAD]
____________, 200_
Citibank, N.A., as Agent for
the Lenders under, and as defined in,
the Credit Agreement referred to below
Ladies and Gentlemen:
The Southern Company ("Southern") hereby refers to that certain Amended
and Restated Credit Agreement, dated as of April 17, 2003 (the "Credit
Agreement"), among Southern Power Company (the "Borrower"), the Initial Lenders
named therein, Citibank, N.A., as Agent, Citigroup Global Markets Inc., as Lead
Arranger, and the Co-Arrangers. Except as otherwise defined in this letter
agreement (the "Agreement"), capitalized terms used herein but not defined shall
have the respective meanings given to them in the Credit Agreement. Southern
owns all of the outstanding stock of the Borrower and acknowledges that it will
benefit from the Credit Agreement.
Southern, therefore, hereby agrees as follows:
(a) if (1) the [name of development authority] (including its
successors and permitted assigns, the "Development Authority") shall: (i) apply
for or consent to the appointment of, or the taking of possession by, a
receiver, custodian, trustee or liquidator of itself or of all or substantially
all of its property; (ii) make a general assignment for the benefit of its
creditors; (iii) commence a voluntary case under the U.S. Bankruptcy Code (as
now or hereafter in effect) or any similar law of any applicable jurisdiction;
(iv) file a petition seeking to take advantage of any other law relating to
bankruptcy, insolvency, reorganization, winding-up, or composition or
readjustment of debts; or (v) fail to controvert in a timely and appropriate
manner, or acquiesce in writing to, any petition filed against it in an
involuntary case under the U.S. Bankruptcy Code or any similar law of any
applicable jurisdiction; or (2) a proceeding or case shall be commenced, without
the application or consent of the Development Authority, in any court of
competent jurisdiction, seeking (A) its liquidation, reorganization, dissolution
or winding-up, or the composition or readjustment of its debts; (B) the
appointment of a trustee, receiver, custodian, liquidator or the like of the
Development Authority or of all or substantially all of its assets; or (C)
similar relief in respect of the Development Authority under any law relating to
bankruptcy, insolvency, reorganization, winding-up, or composition or adjustment
of debts, and such proceeding or case shall continue unstayed and in effect for
a period of ninety (90) or more days (each a "Bankruptcy Event");
(b) if, as a result of such Bankruptcy Event, the Borrower's
leasehold interest with the Development Authority in respect of the [name of
leased project], or any of the Borrower's rights, powers and remedies under or
in connection with the lease of the [name of leased project] with the
Development Authority, or any documents related thereto, is materially and
adversely affected; and
(c) if revenues of the Borrower (after payment of (i) all
operating expenses; and (ii) all Recourse Debt of the Borrower (other than the
Project Debt relating to the [name of leased project]) then due and payable, and
accrued interest thereon) are insufficient to repay any or all of the principal
amount of the Project Debt outstanding with respect to the [name of leased
project], and accrued interest thereon, in each case, as and when due;
then, Southern shall (A) on the Final Maturity Date (or, if required to be
prepaid prior to the Final Maturity Date pursuant to the Credit Agreement, on
such earlier date), pay to the Agent, for the account of the Lenders and on
behalf of the Borrower, such amount as may be required to pay in full the
outstanding principal of all Advances then outstanding with respect to the [name
of leased project] and all accrued and unpaid interest related thereto; (B) pay
all interest due and payable, from time to time, on the outstanding Advances
made with respect to the [name of leased project]; and (C) upon the maturity
thereof, pay to the holders of all Commercial Paper then outstanding with
respect to the [name of leased project] and for which there are one or more CP
Commitment Reservations then outstanding (or a trustee on behalf of such
holders), for the account of the Borrower, such amount as may be required to pay
in full the outstanding principal of all such Commercial Paper and all accrued
and unpaid interest related thereto.
This Agreement has been duly executed and delivered by Southern and
constitutes the legal, valid and binding obligation of Southern enforceable
against Southern in accordance with its terms, subject to laws affecting the
enforcement of creditors' rights generally and to general principles of equity.
This Agreement is intended to be solely for the benefit of the
Borrower, the Agent and the Lenders and is not intended to and shall not confer
any rights or benefits on any other party.
Very truly yours,
The Southern Company
By:
---------------------------------------------------
Name:
-------------------------------------------------
Title:
------------------------------------------------
Agreed and accepted by
Citibank, N.A.,
As Agent for and on behalf of
the Lenders
By:
-----------------------------------------------------------
Name:
---------------------------------------------------------
Title:
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