Exhibit 10.2
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AMENDED AND RESTATED
CREDIT AGREEMENT
$1,200,000,000
Dated as of December 15, 2000
among
ORION POWER MIDWEST, L.P.,
as Borrower,
BANC OF AMERICA SECURITIES LLC,
as a Co-Lead Arranger and as a Joint Book Runner,
BANK OF AMERICA, N.A.,
as Issuing Bank and as Administrative Agent,
GOLDMAN SACHS CREDIT PARTNERS L.P.,
as Co-Lead Arranger, as a Syndication Agent and
as a Joint Book Runner,
PARIBAS,
as an Arranger, as a Documentation Agent and as a Syndication Agent,
DEUTSCHE BANK SECURITIES INC.,
as an Arranger,
DEUTSCHE BANK AG NEW YORK BRANCH,
as a Documentation Agent and as a Syndication Agent,
and
THE FINANCIAL INSTITUTIONS INITIALLY
SIGNATORIES HERETO, TOGETHER WITH THOSE
ASSIGNEES PURSUANT TO SECTION 9.06 HEREOF,
as Lenders
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TABLE OF CONTENTS
Page
ARTICLE I DEFINITIONS........................................................1
SECTION 1.01 DEFINITIONS................................................1
SECTION 1.02 ACCOUNTING TERMS..........................................40
SECTION 1.03 COMPUTATION OF TIME PERIODS...............................40
SECTION 1.04 RULES OF CONSTRUCTION.....................................40
ARTICLE II CREDIT FACILITIES................................................41
SECTION 2.01 ACQUISITION LOANS.........................................41
SECTION 2.02 REVOLVING LOANS...........................................43
SECTION 2.03 BORROWINGS................................................45
SECTION 2.04 ELECTION OF INTEREST RATES................................47
SECTION 2.05 FEES......................................................48
SECTION 2.06 INTEREST..................................................49
SECTION 2.07 MANDATORY PREPAYMENTS.....................................50
SECTION 2.08 VOLUNTARY PREPAYMENT; TERMINATION OF COMMITMENTS;
REVOLVING COMMITMENT REDUCTIONS...........................51
SECTION 2.09 INCREASED COSTS; CAPITAL ADEQUACY; FUNDING BREAKAGE
COSTS.....................................................52
SECTION 2.10 ILLEGALITY................................................53
SECTION 2.11 PAYMENTS AND COMPUTATIONS.................................53
SECTION 2.12 TAXES.....................................................55
SECTION 2.13 SHARING OF PAYMENTS.......................................58
SECTION 2.14 CHANGE OF APPLICABLE LENDING OFFICE.......................58
SECTION 2.15 REPLACEMENT OF LENDERS....................................58
SECTION 2.16 DLC LETTER OF CREDIT......................................59
SECTION 2.17 OPERATIONAL LETTERS OF CREDIT.............................63
ARTICLE III CONDITIONS PRECEDENT............................................68
SECTION 3.01 CONDITIONS PRECEDENT TO THE CLOSING DATE..................68
SECTION 3.02 CONDITIONS PRECEDENT TO REVOLVING LOANS...................75
SECTION 3.03 CONDITIONS PRECEDENT TO THE CEREDO EFFECTIVE DATE.........75
ARTICLE IV REPRESENTATIONS AND WARRANTIES...................................79
SECTION 4.01 EXISTENCE; DUE QUALIFICATION; COMPLIANCE WITH LAW.........79
SECTION 4.02 POWER; AUTHORITY; NO VIOLATION; BINDING EFFECT............79
SECTION 4.03 OWNERSHIP OF PROPERTY.....................................80
SECTION 4.04 GOVERNMENTAL APPROVALS....................................80
SECTION 4.05 LEGAL PROCEEDINGS.........................................81
SECTION 4.06 FINANCIAL STATEMENTS......................................81
SECTION 4.07 INDEBTEDNESS..............................................81
SECTION 4.08 NO DEFAULT................................................81
SECTION 4.09 TAXES.....................................................81
SECTION 4.10 USE OF PROCEEDS...........................................82
SECTION 4.11 COMPLIANCE WITH ERISA.....................................82
SECTION 4.12 MATERIAL LIABILITIES......................................82
SECTION 4.13 REGULATION OF PARTIES.....................................82
SECTION 4.14 SECURITY DOCUMENTS........................................83
SECTION 4.15 ACCURACY AND COMPLETENESS OF INFORMATION..................83
SECTION 4.16 PROPERTY RIGHTS, UTILITIES, ETC...........................84
SECTION 4.17 PROJECT CONTRACTS.........................................84
SECTION 4.18 PRINCIPAL PLACE OF BUSINESS...............................85
SECTION 4.19 PATENTS; LICENSES; FRANCHISES AND FORMULAS................85
SECTION 4.20 ENVIRONMENTAL MATTERS.....................................85
SECTION 4.21 INSURANCE.................................................87
SECTION 4.22 TRANSACTIONS WITH AFFILIATES..............................87
SECTION 4.23 ORGANIZATIONAL STRUCTURE..................................87
SECTION 4.24 PROJECTIONS...............................................87
SECTION 4.25 ENVIRONMENTAL INSURANCE...................................87
SECTION 4.26 EQUITY INTERESTS..........................................88
ARTICLE V AFFIRMATIVE COVENANTS.............................................88
SECTION 5.01 CONDUCT OF BUSINESS; MAINTENANCE OF EXISTENCE.............88
SECTION 5.02 GOVERNMENTAL APPROVALS....................................89
SECTION 5.03 PAYMENT OF INDEBTEDNESS...................................89
SECTION 5.04 ACCOUNTS..................................................89
SECTION 5.05 PERFORMANCE OF COVENANTS, ETC.............................89
SECTION 5.06 INSURANCE REQUIREMENTS....................................89
SECTION 5.07 BOOKS AND RECORDS.........................................89
SECTION 5.08 VISITATION, INSPECTION, ETC...............................89
SECTION 5.09 REQUIREMENTS OF LAW.......................................90
SECTION 5.10 REPORTING REQUIREMENTS....................................90
SECTION 5.11 OPERATING BUDGET..........................................91
SECTION 5.12 PAYMENT OF TAXES AND CLAIMS...............................93
SECTION 5.13 MAINTENANCE AND OPERATION OF PORTFOLIO ASSETS; REPAIR
AND REPLACEMENT OF PORTFOLIO ASSETS.......................93
SECTION 5.14 REAL AND PERSONAL PROPERTY................................93
SECTION 5.15 ERISA.....................................................94
SECTION 5.16 INTEREST HEDGE CONTRACTS..................................94
SECTION 5.17 NOTICES...................................................95
SECTION 5.18 PRESERVATION OF SECURITY INTERESTS; FURTHER ASSURANCES....96
SECTION 5.19 USE OF PROCEEDS...........................................97
SECTION 5.20 EXTRAORDINARY PROCEEDS....................................97
SECTION 5.21 ENVIRONMENTAL COMPLIANCE..................................97
SECTION 5.22 ADDITIONAL CONTRACTS......................................99
SECTION 5.23 OTHER INFORMATION.........................................99
SECTION 5.24 FUEL PROCUREMENT AND O&M ARRANGEMENTS....................100
SECTION 5.25 POWER MARKETING AND TRANSMISSION ARRANGEMENTS............100
SECTION 5.26 CAPITAL EXPENDITURES.....................................101
SECTION 5.27 POLR II AGREEMENT........................................102
SECTION 5.28 CEREDO SECURITY DOCUMENTS................................102
ARTICLE VI NEGATIVE COVENANTS..............................................103
SECTION 6.01 LIMITATION ON MERGERS....................................103
SECTION 6.02 LIMITATION ON INDEBTEDNESS...............................103
SECTION 6.03 LIMITATION ON LIENS......................................103
SECTION 6.04 NATURE OF BUSINESS.......................................103
SECTION 6.05 PROJECT CONTRACTS; WAIVER; MODIFICATION; AMENDMENT.......104
SECTION 6.06 PARTNERSHIPS; SUBSIDIARIES...............................105
SECTION 6.07 LOANS, ADVANCES OR INVESTMENTS...........................105
SECTION 6.08 LIMITATION ON CAPITAL EXPENDITURES.......................105
SECTION 6.09 AFFILIATE TRANSACTIONS...................................105
SECTION 6.10 DISTRIBUTIONS............................................105
SECTION 6.11 LIMITATION ON DISPOSITION OF ASSETS......................105
SECTION 6.12 OPERATING BUDGET.........................................106
SECTION 6.13 DEBT SERVICE COVERAGE RATIO..............................106
SECTION 6.14 ENVIRONMENTAL INSURANCE..................................107
SECTION 6.15 ASH DISPOSAL.............................................107
SECTION 6.16 SPECULATIVE TRADING......................................107
ARTICLE VII EVENTS OF DEFAULT..............................................107
SECTION 7.01 PAYMENTS.................................................107
SECTION 7.02 COVENANTS................................................108
SECTION 7.03 REPRESENTATIONS..........................................109
SECTION 7.04 DEFAULTS OF OTHER INDEBTEDNESS...........................109
SECTION 7.05 SECURITY DOCUMENTS.......................................109
SECTION 7.06 TRANSACTION DOCUMENTS....................................110
SECTION 7.07 BANKRUPTCY...............................................110
SECTION 7.08 GOVERNMENTAL APPROVALS...................................110
SECTION 7.09 OWNERSHIP................................................111
SECTION 7.10 JUDGMENT.................................................112
SECTION 7.11 DESTRUCTION OF PORTFOLIO ASSETS..........................112
SECTION 7.12 ERISA....................................................112
SECTION 7.13 REGULATORY STATUS........................................112
SECTION 7.14 NEGATIVE PLEDGE..........................................112
SECTION 7.15 ABANDONMENT..............................................113
SECTION 7.16 SPONSOR INDEBTEDNESS.....................................113
SECTION 7.17 CEREDO PROJECT...........................................113
ARTICLE VIII THE AGENTS AND ISSUING BANK...................................114
SECTION 8.01 APPOINTMENT OF AGENTS, POWERS AND IMMUNITIES.............114
SECTION 8.02 RELIANCE BY AGENTS.......................................114
SECTION 8.03 DEFAULTS 114
SECTION 8.04 RIGHTS AS LENDERS........................................115
SECTION 8.05 INDEMNIFICATION..........................................115
SECTION 8.06 DOCUMENTS................................................116
SECTION 8.07 NON-RELIANCE ON AGENTS AND OTHER LENDERS.................116
SECTION 8.08 RESIGNATION..............................................116
SECTION 8.09 AUTHORIZATION............................................117
SECTION 8.10 DOCUMENTATION AGENTS; SYNDICATION AGENTS; JOINT BOOK
RUNNERS, ARRANGERS.......................................117
ARTICLE IX MISCELLANEOUS...................................................117
SECTION 9.01 NOTICES..................................................117
SECTION 9.02 AMENDMENTS, ETC..........................................117
SECTION 9.03 NO WAIVER; REMEDIES CUMULATIVE...........................118
SECTION 9.04 PAYMENT OF EXPENSES AND INDEMNIFICATION..................118
SECTION 9.05 RIGHT OF SETOFF..........................................120
SECTION 9.06 BENEFIT OF AGREEMENT; ASSIGNMENTS AND PARTICIPATIONS.....121
SECTION 9.07 GOVERNING LAW; SUBMISSION TO JURISDICTION; WAIVER OF
JURY TRIAL; WAIVER OF DAMAGES............................123
SECTION 9.08 NONLIABILITY OF ADMINISTRATIVE AGENT AND LENDERS.........125
SECTION 9.09 MARSHALLING; RECAPTURE...................................125
SECTION 9.10 INDEPENDENT NATURE OF LENDERS' RIGHTS....................126
SECTION 9.11 COUNTERPARTS.............................................126
SECTION 9.12 EFFECTIVENESS............................................126
SECTION 9.13 SURVIVAL OF INDEMNITIES AND REPRESENTATIONS AND
WARRANTIES...............................................126
SECTION 9.14 SEVERABILITY.............................................126
SECTION 9.15 HEADINGS DESCRIPTIVE.....................................126
SECTION 9.16 LIMITATION OF RECOURSE...................................126
SECTION 9.17 CONFIDENTIALITY..........................................127
ANNEXES:
Annex I - Commitments
Annex II - Notice Provisions
Annex III - Estimated Income Taxes
SCHEDULES:
Schedule 1.01(a)- Avon Lake; Brunot Island; Cheswick; Elrama; New Castle; Niles;
Phillips; Ceredo
Schedule 1.01(b)- Known Conditions List
Schedule 1.01(c)- Acquired Fuel Supply Contracts
Schedule 4.04 - Governmental Approvals
Schedule 4.05 - Material Litigation
Schedule 4.12 - Material Liabilities
Schedule 4.14 - Filing Offices
Schedule 4.19 - Patents; Licenses; Franchises and Formulas
Schedule 4.20 - Environmental Matters
Schedule 4.22 - Transactions with Affiliates
Schedule 4.23A - Closing Date Organizational Structure
Schedule 4.23B - Ceredo Effective Date Organizational Structure
Schedule 5.06 - Insurance Requirements
Schedule 5.22 - Additional Contracts Relating to Ceredo
EXHIBITS:
Exhibit A - Form of Acquisition Loan Note
Exhibit B - Form of Revolving Loan Note
Exhibit C - Form of Notice of Acquisition Borrowing
Exhibit D - Form of Notice of Revolving Borrowing
Exhibit E - Form of Notice of Conversion
Exhibit F - Form of Deposit Account Agreement
Exhibit G - Form of Security Account Control Agreement
Exhibit H - Form of Borrower Security Agreement
Exhibit I-1 - Form of GP Partnership Interest Pledge Agreement
Exhibit I-2 - Form of LP Partnership Interest Pledge Agreement
Exhibit J - Form of Borrower Mortgage
Exhibit K - Form of Assignment and Acceptance
Exhibit L - Form of Equity Contribution Agreement
Exhibit M - Form of DLC Letter of Credit
Exhibit N - Form of Subordinated Equity Owner Loan Agreement
Exhibit O - Form of Stock Pledge Agreement
Exhibit P - Form of Subsidiary Guarantee
Exhibit Q - Form of Intercompany Working Capital Agreement
Exhibit R - Form of Intercompany Working Capital Note
Exhibit S - Form of Subsidiary Security Agreement
Exhibit T - Form of Supplemental Agreement
Exhibit U - Form of LLC Interest Pledge Agreement
Exhibit V - Form of Subsidiary Operating Agreement Covenants
Exhibit W - [Reserved]
Exhibit X - Form of Amendment No. 1 to Ceredo EPC Contract
Exhibit Y - Form of Twelvepole Management Services Agreement
THIS AMENDED AND RESTATED CREDIT AGREEMENT is entered into as of
December 15, 2000 (this "AGREEMENT"), among ORION POWER MIDWEST, L.P., a
Delaware limited partnership (the "BORROWER"), BANC OF AMERICA SECURITIES LLC
and GOLDMAN SACHS CREDIT PARTNERS L.P., as co-lead arrangers (collectively, the
"CO-LEAD Arrangers"), PARIBAS and DEUTSCHE BANK SECURITIES INC., as arrangers
(together with the Co-Lead Arrangers, the "ARRANGERS"), BANC OF AMERICA
SECURITIES LLC AND GOLDMAN SACHS CREDIT PARTNERS L.P., as joint book runners
(collectively, the "JOINT BOOK RUNNERS"), BANK OF AMERICA, N.A., as
administrative agent for the Lenders (in such capacity, together with any
successors and assigns, the "ADMINISTRATIVE AGENT"), BANK OF AMERICA, N.A., as
issuer of the Letters of Credit (the "ISSUING BANK"), GOLDMAN SACHS CREDIT
PARTNERS L.P., PARIBAS and DEUTSCHE BANK AG NEW YORK BRANCH, as syndication
agents (collectively, the "SYNDICATION AGENTS"), PARIBAS and DEUTSCHE BANK AG
NEW YORK BRANCH, as documentation agents (collectively, the "DOCUMENTATION
AGENTS"), and the financial institutions signatories hereto (each of which,
together with each other financial institution which may hereafter become an
assignee pursuant to Section 9.06 is hereinafter referred to as a "LENDER", and
collectively the "LENDERS").
W I T N E S S E T H:
WHEREAS, the Borrower has requested the Lenders, and the Lenders have
agreed, subject to the terms and conditions set forth herein, to extend a credit
facility to the Borrower to finance the purchase by the Borrower of the
Portfolio Assets (defined below) and to provide revolving advances to the
Borrower from time to time; and
WHEREAS, it is an obligation of the Borrower to provide an irrevocable
standby letter of credit to DLC (as defined below) pursuant to the POLR
Agreement described below, and the Issuing Bank has agreed to provide such
letter of credit, subject to the terms and conditions set forth herein;
NOW, THEREFORE, the Borrower, the Arrangers, the Administrative Agent,
the Syndication Agents, the Documentation Agents, the Issuing Bank, and the
Lenders agree as follows:
ARTICLE I
DEFINITIONS
Section 1.01 DEFINITIONS. As used in this Agreement, the following
terms shall have the meanings specified below (to be equally applicable to both
the singular and plural forms of the terms defined):
"ACCEPTABLE CAPACITY PROVIDER" shall mean any of (A) any Person (i)
that owns and/or operates power generation assets, (ii) has the ability and
legal and/or contractual right to sell power, electric capacity and/or energy
into the area covered by ECAR and/or the Duquesne Control Area, and (iii) whose
long term senior unsecured indebtedness has been assigned an Investment Grade
Rating by Moody's and S&P, and (B) CPS, for so long as it is a wholly-owned
subsidiary, directly or indirectly, of Constellation Enterprises, Inc.;
PROVIDED, THAT, CPS shall be considered an Acceptable Capacity Provider only
with respect to contracts or agreements which provide for (i) physical delivery
of not more than an aggregate amount of 750MW on a one-day (or less) forward
basis, less any electric capacity and/or energy to be delivered pursuant to the
following clause (ii), and (ii) physical delivery of not more than 250 MW (on
more than a one day forward basis), within 12 months from the Closing Date,
where CPS has entered into "back-to-back" contracts covering such delivery
obligations with a Person meeting the requirements of clause (A) preceding.
"ACCEPTABLE RESERVES" shall mean, with respect to any contest,
dispute, appeal or other similar circumstance in respect of which any Borrower
Entity is entitled hereunder to provide reserves (including pursuant to Section
5.09), any of (i) cash reserves in an amount equal to such Borrower Entity's
maximum liability in respect of such contest, dispute, appeal or circumstance
deposited with the Administrative Agent; (ii) a bond or bonds, surety, insurance
or other similar obligation of the relevant Borrower Entity reasonably
acceptable to the Administrative Agent and in an amount necessary to satisfy the
applicable reserve requirement as reasonably determined by the Administrative
Agent; or (iii) from and after such time as Indebtedness of the Borrower shall
have an Investment Grade Rating from Moody's or S&P, reserves in conformity with
GAAP maintained by the relevant Borrower Entity.
"ACCOUNTS" shall mean the collective reference to the Revenue Account,
the Operating Account, the Twelvepole Construction Account, the Insurance
Proceeds Account, the Debt Service Account, the Debt Service Reserve Account,
the Replacement Capital Expenditure Pre-Funding Account, the Loan Proceeds
Account, the Extraordinary Proceeds Account, the Equity Proceeds Account, the
Prepayment Account, the Cash Retention Account, the Distribution Account, the
Distribution Holdback Account and all sub-accounts established within any of the
foregoing.
"ACQUIRED FUEL SUPPLY CONTRACTS" shall mean those certain fuel supply
agreements set forth on SCHEDULE 1.01(C) hereto.
"ACQUISITION AGREEMENT" shall mean the Asset Purchase Agreement, dated
as of September 24, 1999, between DLC, the FE Subsidiaries and the Sponsor.
"ACQUISITION AGREEMENT TERMINATION DATE" shall mean September 24,
2000.
"ACQUISITION COSTS" shall mean the aggregate cost required to purchase
the Portfolio Assets (other than Ceredo), initially fund the Debt Service
Reserve Account and the Replacement Capital Expenditure Pre-Funding Account and
pay Closing Expenses, which is estimated to be approximately $1,836,137,000.
"ACQUISITION DOCUMENTS" shall mean, collectively, the Acquisition
Agreement, the POLR Agreement, the Must-Run Agreements, the Easement and
Attachment Agreements, the Interconnection Agreements and the Acquired Fuel
Supply Contracts.
"ACQUISITION LENDER" shall mean each Lender that, from time to time,
has Acquisition Loan Commitments outstanding or has made Acquisition Loan
Advances hereunder.
"ACQUISITION LOAN" shall mean a Loan consisting of simultaneous
Acquisition Loan Advances of the same Type from each of the Acquisition Lenders
pursuant to Section 2.01(a).
"ACQUISITION LOAN ADVANCE" shall mean an advance by an Acquisition
Lender to the Borrower as part of an Acquisition Loan pursuant to Section
2.01(a).
"ACQUISITION LOAN COMMITMENT" shall mean, as to any Acquisition Lender
as of any date, the difference between (i) the amount set forth opposite such
Acquisition Lender's name on ANNEX I hereto under the heading "Acquisition Loan
Commitment", as such annex may be amended from time to time and as such amount
may be reduced from time to time pursuant to this Agreement, or increased or
reduced from time to time by assignment pursuant to Section 9.06, and (ii) the
aggregate principal amount of Acquisition Loan Advances made by such Acquisition
Lender as of such date of determination.
"ACQUISITION LOAN NOTE" shall have the meaning ascribed thereto in
Section 2.01(b)(i).
"ADDITIONAL CONTRACT" shall mean any of the following agreements or
undertakings to which any Borrower Entity is a party, in each case relating to
the Portfolio Assets and entered into after the Closing Date: (i) any agreement,
or series of related agreements, for the supply of fuel to any Portfolio Asset
whose term extends for more than 365 days and any material agreement for the
supply of fuel to the Portfolio Assets other than as contemplated in the Fuel
Plan then in effect, (ii) any material agreement for the operation and/or
maintenance of any portion of the Portfolio Assets that is not discussed or
contemplated in or by the O&M Plan or the Operating Budget then in effect, (iii)
any agreements with an Affiliate or Affiliates of the Borrower other than as
specifically contemplated by the Financing Documents or any Operational Plan
then in effect, (iv) any contract for the purchase or sale of power, electric
capacity and/or energy, other than as contemplated by the Power Marketing Plan
then in effect, (v) all material contracts (as determined by the Administrative
Agent in the exercise of its reasonable discretion) relating to the Brunot
Island Reactivation Project (as defined in Section 5.26(b) below) or (vi) any
material contract (as determined by the Administrative Agent in the exercise of
its reasonable discretion) or series of contracts relating to any Capital
Expenditure project (other than the Brunot Island Reactivation Project) in
respect of which the Borrower is obligated to expend greater than $20,000,000 in
the aggregate.
"ADDITIONAL CONTRACT CONSENT" shall mean the consent of the
counterparty to each Additional Contract to the assignment of each such
Additional Contract to the Administrative Agent pursuant to a Security
Agreement, in form and substance approved by the Administrative Agent, such
approval not to be unreasonably withheld, conditioned or delayed, it being
acknowledged and agreed that a consent no less favorable to the Lenders than the
DLC Consent shall be deemed reasonable.
"ADMINISTRATIVE AGENT" shall have the meaning ascribed thereto in the
preamble to this Agreement.
"ADMINISTRATIVE AGENT FEE SIDE LETTER" shall mean the letter agreement
regarding the Agency Fee described therein, dated as of the Closing Date,
between the Borrower and the Administrative Agent.
"ADVANCE" shall mean, as applicable, an Acquisition Loan Advance or a
Revolving Advance.
"AEP CONSENT" shall mean a consent and acknowledgment agreement among
American Electric Power Service Corporation, the Administrative Agent and
Twelvepole, in regard to the Ceredo Interconnection and Operation Agreement, in
form and substance reasonably satisfactory to the Arrangers.
"AFFILIATE" shall mean, as to any Person, any other Person directly or
indirectly controlling or controlled by, or under common control with, such
Person. For purposes of this definition, "control" (including, with correlative
meanings, the terms "controlling", "controlled by" and "under common control
with") when used with respect to any Person means the possession, directly or
indirectly, of the power either (i) to vote 10% or more of the securities having
ordinary voting power for the election of directors of such Person or (ii) to
direct or cause the direction of the management and policies of such Person,
whether through the ownership of voting securities, by contract or otherwise.
"AGENCY AGREEMENT" shall mean that certain Agency Agreement, dated as
of April 27, 2000.
"AGENCY FEE" shall have the meaning ascribed thereto in the
Administrative Agent Fee Side Letter.
"AGENTS" shall mean the collective reference to the Administrative
Agent, the Syndication Agents and the Documentation Agents.
"AGGREGATE COMMITMENT" shall mean with respect to each Lender, the sum
of (i) its Acquisition Loan Commitment PLUS (ii) its Revolving Loan Commitment.
"APPLICABLE LENDING OFFICE" shall mean, with respect to each Lender,
such Lender's LIBO Lending Office, and, with respect to the Administrative
Agent, its office located at 100 North Tryon Street, NC1-007-12-05, Charlotte,
NC 28255, or such other office as the Administrative Agent may from time to time
specify to the Borrower and the Lenders.
"APPLICABLE MARGIN" shall mean the Base Rate Margin or the LIBO Rate
Margin, as the context requires.
"APPROVED CAPACITY PURCHASER" shall mean (i) CPS, for so long as it is
a wholly-owned subsidiary, directly or indirectly, of Constellation Enterprises,
Inc. or (ii) any Person whose long term senior unsecured indebtedness has been
assigned an Investment Grade Rating by Moody's and S&P, or a Person whose
obligations are guaranteed by a Person whose long term senior unsecured
indebtedness has been assigned an Investment Grade Rating by Moody's and S&P.
"APPROVED POWER PURCHASE AGREEMENT" shall mean any contract or other
agreement between any Borrower Entity (or any Affiliate thereof) and an
Acceptable Capacity Provider relating to capacity purchases and/or options to
call on capacity from such Acceptable Capacity Provider containing provisions
for, among other things, the payment by such Acceptable Capacity Provider of
liquidated damages in a minimum amount equal to the cost of replacement capacity
in the event of a failure to perform by such Acceptable Capacity Provider
thereunder.
"APPROVED POWER SALES AGREEMENT" shall mean any contract or other
agreement, other than the Spot Power Sales Agreements, between any Borrower
Entity (or any Affiliate thereof) and an Approved Capacity Purchaser relating to
capacity sales and options to sell capacity to Approved Capacity Purchasers that
contain provisions for, among other things, a maximum forward delivery date
thereunder of less than 365 days from the date thereof.
"ARRANGERS" shall have the meaning ascribed thereto in the preamble to
this Agreement.
"ASSIGNMENT AND ACCEPTANCE" shall mean an assignment and acceptance
entered into by an assigning Lender and an assignee Lender, and accepted by the
Administrative Agent, in accordance with Section 9.06 and substantially in the
form of EXHIBIT K.
"AVON LAKE" shall mean all generating units and related assets located
at the generating station known as Avon Lake as more fully described on SCHEDULE
1.01(A) hereto, and all additions, modifications and improvements thereto.
"BASE RATE" shall mean, for any period, a fluctuating interest rate
per annum as shall be in effect from time to time, which rate per annum shall at
all times be equal to the higher of (a) the rate of interest announced publicly
by the Administrative Agent, from time to time, as its "base rate" or "prime
rate" for Dollar loans (which rate may not necessarily be its lowest rate) and
in effect on any date of determination, as determined by the Administrative
Agent, and (b) the sum of the Federal Funds Rate in effect on any date of
determination, as determined by the Administrative Agent plus 0.50%.
"BASE RATE ADVANCE" shall mean any Advance which bears interest based
upon the Base Rate.
"BASE RATE LOAN" shall mean a Loan consisting of simultaneous Base
Rate Advances from each of the applicable Lenders.
"BASE RATE MARGIN" shall mean, during the period, (i) from the Closing
Date until the date twelve (12) months thereafter, 0.375%, (ii) from and
including the date twelve (12) months after the Closing Date until the date
twenty-four (24) months thereafter, 0.50% and (iii) from and including the date
twenty-four (24) months after the Closing Date until and including the Final
Maturity Date, 1.00%.
"BENEFIT ARRANGEMENT" shall mean at any time an employee benefit plan
within the meaning of Section 3(3) of ERISA which is not a Plan or a
Multiemployer Plan and which is maintained or otherwise contributed to by any
Borrower Entity, the Operator or any ERISA Affiliate.
"BORROWER" shall have the meaning ascribed thereto in the preamble to
this Agreement.
"BORROWER CONSENTS" shall mean the collective reference to (i) the DLC
Consent, the FE Consent, the Operator Consent, the Harwick Consent, and the CPS
Consent and (ii) all Additional Contract Consents relating to the Portfolio
Assets (excluding Ceredo).
"BORROWER ENTITY" shall mean the collective reference to the Borrower
and, from and after the Ceredo Effective Date, Twelvepole.
"BORROWER MORTGAGES" shall mean one or more Mortgage, Security
Agreement, Fixture Filing and Assignment of Leases and Rents executed and
delivered by the Borrower in favor of the Administrative Agent in respect of
real property located in Allegheny County, Pennsylvania, Beaver County,
Pennsylvania, Lawrence County, Pennsylvania, Washington County, Pennsylvania,
Lorain County, Ohio and Trumbull County, Ohio which is owned or leased by the
Borrower, substantially in the form of EXHIBIT J hereto.
"BORROWER SECURITY AGREEMENT" shall mean that certain Security
Agreement, dated as of the Closing Date, between the Borrower and the
Administrative Agent (for the benefit of the Secured Parties), substantially in
the form of EXHIBIT H hereto.
"BORROWER TWELVEPOLE LLC INTEREST PLEDGE AGREEMENT" shall mean that
certain LLC Interest Pledge Agreement, dated as of the Ceredo Effective Date,
among the Borrower, Twelvepole and the Administrative Agent (for the benefit of
the Secured Parties), relating to the Borrower's membership interests in
Twelvepole, substantially in the form of Exhibit U hereto.
"BORROWING" shall mean a borrowing consisting of Loans made of, or
Converted into, the same Type and Interest Period made on the same day by the
Lenders. Borrowings consisting of Loans of the same Type and Interest Period on
the same day shall be deemed a single Borrowing hereunder until repaid in full
or next Converted.
"BRUNOT ISLAND" shall mean all generating units and related assets
located at the generating station known as Brunot Island, as more fully
described on SCHEDULE 1.01(A) hereto, and all additions, modifications and
improvements thereto.
"BRUNOT ISLAND PIPELINE" shall mean the natural gas pipeline to be
installed at Brunot Island with a transportation capacity necessary to provide
gas required to operate Brunot Island at least at the capacity level
contemplated in the Projections.
"BUDGETED OPERATING COSTS" shall mean, with respect to the Operating
Budget for any fiscal year of the Borrower Entities (excluding Twelvepole, until
Ceredo has achieved Commercial Operation), the aggregate amount of all Operating
Costs set forth in such Operating Budget.
"BUSINESS DAY" shall mean any day, which is not a Saturday or Sunday,
on which commercial banks are open for business in New York, New York and
Charlotte, North Carolina and, if such day relates to a borrowing of, a payment
or prepayment of principal of, or a Conversion of or into, or an interest period
for, a LIBO Rate Loan or a notice by the Borrower with respect to any such
borrowing, payment, prepayment, Conversion or interest period, which day is also
a day on which dealings in U.S. dollar deposits are carried out in the London
interbank market.
"CAPITAL EXPENDITURES" shall mean, for any period, all expenditures by
any Borrower Entity (excluding expenditures of Twelvepole, until Ceredo has
achieved Commercial Operation) which would be classified as "capital
expenditures" in accordance with GAAP (including, without limitation,
expenditures for maintenance and repairs which, in conformity with GAAP, would
be capitalized and obligations under Capital Leases of any capital asset)
including, without limitation, Non-Discretionary Capital Expenditures.
"CAPITAL LEASE" shall mean, with respect to any Person, any lease of
property (whether real, personal or mixed) by that Person as lessee which, in
conformity with GAAP, is required to be accounted for as a capital lease on the
balance sheet of that Person.
"CAPITAL STOCK" shall mean, with respect to any Person, any and all
shares, interests, rights to purchase, warrants, options, participations or
other equivalents of or interest in (however designated) the common or
preference share capital of such Person, including, without limitation,
partnership interests and limited liability company interests.
"CASH RETENTION ACCOUNT" shall mean the special account designated by
that name and established by the Administrative Agent pursuant to the Deposit
Account Agreement.
"CEREDO" shall mean all generating units and related assets located at
the generating station known as Ceredo, as more fully described on Schedule
1.01(a) attached hereto, and all additions, modifications and improvements
thereto.
"CEREDO BOND INDENTURE" shall mean that certain Bond Indenture and
Security Agreement between The County Commission of Wayne County, West Virginia
and Bank One, West Virginia, National Association dated July 1, 2000.
"CEREDO CLOSING DATE" shall mean December 15, 2000.
"CEREDO CONSENTS" shall mean the collective reference to the Wayne
County Commission Consent, the Mountaineer Consent, the AEP Consent and all
Additional Contract Consents relating to Ceredo.
"CEREDO CONSTRUCTION AND TRANSPORTATION AGREEMENT" shall mean that
certain Facilities Construction and Gas Transportation Agreement between
Twelvepole and Mountaineer Gas Company dated July 12, 2000.
"CEREDO CONSTRUCTION EQUITY CONTRIBUTION AMOUNT" shall mean
$100,000,000.
"CEREDO EFFECTIVE DATE" shall mean the date on which all of the
conditions precedent set forth in Section 3.03 hereof have been satisfied or
waived.
"CEREDO EFFECTIVE DATE GOVERNMENTAL APPROVALS" shall mean those
Governmental Approvals relating to Ceredo or Twelvepole required to be obtained
by any Credit Party on or prior to the Ceredo Effective Date, as set forth in
Parts A and B of Schedule 4.04.
"CEREDO EPC CONTRACT" shall mean that certain Engineering, Procurement
and Construction Services Contract (EPC Contract) between Twelvepole and AEP Pro
Serv, Inc. dated April 28, 2000 (including Change Order No. 1 dated June 21,
2000).
"CEREDO GENERATOR PURCHASE ORDER" shall mean that certain Purchase
Order for six (6) 7EA Combustion Turbine Generators between Columbia Capacity
LLC and General Electric Company dated March 10, 2000.
"CEREDO INTERCONNECTION AND OPERATION AGREEMENT" shall mean that
certain Interconnection and Operation Agreement between American Electric Power
Service Corporation and Twelvepole dated June 28, 2000.
"CEREDO LEASE AGREEMENT" shall mean that certain Lease Agreement
between The County Commission of Wayne County, West Virginia and Twelvepole
dated July 1, 2000.
"CEREDO PARENT GUARANTY" shall mean that certain Parent Guaranty for
EPC Contract by Columbia Electric Corporation in favor of AEP Pro Serv, Inc.
dated July 5, 2000.
"CEREDO PROJECT CONTRACTS" shall mean the collective reference to (i)
the Ceredo Construction and Transportation Agreement, the Ceredo EPC Contract,
the Ceredo Interconnection and Operation Agreement, the Ceredo Lease Agreement,
the Ceredo Purchase and Sale Agreement, the Ceredo Parent Guaranty and the
Governing Documents of Twelvepole and (ii) all other material interconnection
agreements, material power marketing agreements, all material transmission
services agreements, all material easements and material rights-of-way, and all
material utility supply agreements and all Additional Contracts relating to
Ceredo.
"CEREDO PURCHASE AGREEMENT" shall mean that certain Purchase
Agreement, dated as of February 18, 2000, by and between Glenn John Meddings and
Patricia Meddings, and Columbia Electric Corporation, assigned to Twelvepole
pursuant to that certain Assignment of Purchase Agreement, dated May 4, 2000, by
and between Columbia Electric Corporation, Twelvepole and Glenn John Meddings
and Patricia Ann Meddings.
"CEREDO PURCHASE AND SALE AGREEMENT" shall mean that certain Purchase
and Sale Agreement for Ceredo Electric Generating Station Project Site between
Columbia Gas Transmission Corporation and Twelvepole dated March 31, 2000.
"CEREDO SECURITY DOCUMENTS" shall mean the collective reference to the
Borrower Twelvepole LLC Interest Pledge Agreement, the Ceredo Consents, the
Twelvepole Guarantee, the Twelvepole Intercompany Agreement, the Twelvepole
Intercompany Working Capital Note, the Twelvepole Mortgage, the Twelvepole
Security Agreement, and the Twelvepole Supplemental Agreement, along with the
Twelvepole Financing Statements and all other filings made pursuant thereto.
"CEREDO STACK PURCHASE AGREEMENT" shall mean that certain Braden Stack
Purchase Agreement between Twelvepole and Braden Manufacturing for supply of six
(6) turbine exhaust systems dated August 2, 2000.
"CEREDO TRANSFORMER PURCHASE ORDER" shall mean that certain Purchase
Order for three (3) main generator/transformers between Twelvepole and
Pennsylvania Transformer Technology, Inc. dated April 28, 2000 (including Change
Order no. 1 dated May 5, 2000).
"CEREDO TRANSACTION DOCUMENTS" shall mean the collective reference to
the Ceredo Project Contracts and the Ceredo Security Documents.
"CHESWICK" shall mean all generating units and related assets located
at the generating station known as Cheswick, as more fully described on SCHEDULE
1.01(A) attached hereto, and all additions, modifications and improvements
thereto.
"CLEAN-UP COSTS" shall have the meaning set forth in the Environmental
Insurance Policy.
"CLOSING DATE" shall mean April 28, 2000.
"CLOSING DATE GOVERNMENTAL APPROVALS" shall mean those Governmental
Approvals required to be obtained by any Credit Party on or prior to the Closing
Date, as set forth in Parts A and B of SCHEDULE 4.04 hereto.
"CLOSING EXPENSES" shall mean all Fees payable by the Borrower on the
Closing Date pursuant to any Financing Document and all other costs and expenses
(including prorated taxes) payable by the Borrower in connection with the
acquisition of the Portfolio Assets (excluding Ceredo) which are included in
detail in the Projections or are otherwise approved by the Borrower and the
Arrangers.
"CLOSING FAILURE" shall mean the failure of the Ceredo Effective Date
to occur on or before December 31, 2000.
"CODE" shall mean the Internal Revenue Code of 1986, as amended from
time to time.
"CO-LEAD ARRANGER" shall mean each of Banc of America Securities LLC
and Goldman Sachs Credit Partners L.P., or any of their respective Affiliates
which becomes a party to this Agreement and the other applicable Financing
Documents as a "Co-Lead Arranger".
"COLLATERAL" shall mean at any time all property and interest of any
kind, now owned or hereafter acquired, which is at such time subject to, or
purported to be subject to, a Lien in favor of the Administrative Agent (for the
benefit of the Secured Parties) created or granted pursuant to the Security
Documents in effect at such time.
"COLUMBIA CAPACITY" means Columbia Capacity, LLC, a Delaware limited
liability company.
"COMMERCIAL OPERATION" shall mean and shall be deemed to have occurred
upon (i) receipt by the Administrative Agent of a certificate of the Independent
Engineer certifying that each "Phase" and the "Facility" have achieved
"Substantial Completion" (as such terms are defined in the Ceredo EPC Contract),
or (ii) in the event any "Phase" or the "Facility" shall not have achieved
"Substantial Completion" (as such terms are defined in the Ceredo EPC Contract),
then (A) upon delivery by Borrower to the Arrangers of an officer's certificate
certifying (1) the amount of megawatts and associated heat rate of each such
"Phase" or such "Facility" successfully tested pursuant to the Ceredo EPC
Contract, (2) the amount of liquidated damages or other amounts which will be
applied in prepayment of the Loans upon approval by the Arrangers of the
certifications set forth in such Borrower certificate, and (3) that the Borrower
is then in compliance with its covenants under Section 5.25, (B) approval by the
Arrangers (after consultation with the Independent Engineer) of the
certifications set forth in such Borrower certificate and (C) deposit of the
liquidated damages and other amounts described in Clause (A)(2) above to the
Extraordinary Proceeds Account for application in prepayment of the Loans in
accordance with the Deposit Account Agreement.
"COMMITMENT FEES" shall mean any fees payable by the Borrower to the
Administrative Agent (for the account of the Lenders) in accordance with Section
2.05(a).
"COMMITMENTS" shall mean the collective reference to the Acquisition
Loan Commitments and the Revolving Loan Commitments.
"CONDEMNATION PROCEEDS" shall mean all amounts and proceeds (including
instruments) received in respect of any action by any Governmental Authority to
condemn, or obtain through powers of eminent domain any portion of the Portfolio
Assets or the property or assets of any Borrower Entity.
"CONSENTS" shall mean the collective reference to (i) the Borrower
Consents and (ii) from and after the Ceredo Effective Date, the Ceredo Consents.
"CONTRACTUAL OBLIGATION" shall mean, with respect to any Person, any
provision of any securities issued by such Person or any indenture, mortgage,
deed of trust, contract, undertaking, document, instrument or other agreement to
which such Person is a party or by which it or any of its properties is bound or
subject.
"CONVERSION", "CONVERT" or "CONVERTED" each refers to a conversion of
Loans pursuant to Section 2.04, including but not limited to any selection of a
longer of shorter Interest Period to be applicable thereto or any continuation
of a Loan as described in Section 2.04.
"COSI" shall mean Constellation Operating Services, Inc., a Maryland
corporation.
"COSI TECHNICAL SUPPORT AGREEMENT" shall mean the Technical Support
Agreement, dated as of April 26, 2000, by and between COSI and the Sponsor
relating to the O&M Agreement.
"CPI" shall mean the price index computed and issued monthly by the
Bureau of Labor Statistics of the U. S. Department of Labor.
"CPS" shall mean Constellation Power Source, Inc., a Delaware
corporation.
"CPS CONSENT" shall mean that certain consent and acknowledgement
agreement among CPS, the Borrower and the Administrative Agent.
"CPS STRATEGIC ALLIANCE AGREEMENT" shall mean that certain Strategic
Alliance Agreement, dated as of March 10, 1998, between the Sponsor and CPS.
"CREDIT PARTY" shall mean each of the Sponsor, Harwick, the Borrower,
each Partner, and, from and after the Ceredo Effective Date, Twelvepole.
"DEBT SERVICE" shall mean, for any period and without duplication, the
difference between (a) the sum of (i) all interest payments paid, payable or
accrued on all Indebtedness of the Borrower for borrowed money during such
period, (ii) scheduled principal due and payable on all Indebtedness of the
Borrower for borrowed money during such period, and (iii) all payments under
Interest Hedge Contracts paid by the Borrower during such period, and (iv) all
Fees (other than Fees constituting Closing Expenses) payable by the Borrower
pursuant to any Financing Document during such period, MINUS (b) amounts, if
any, received by the Borrower under Interest Hedge Contracts during such period;
PROVIDED, THAT, nothing in this definition shall be deemed to modify Section
6.02 hereof.
"DEBT SERVICE ACCOUNT" shall mean the special account designated by
that name and established by the Administrative Agent pursuant to the Deposit
Account Agreement.
"DEBT SERVICE COVERAGE RATIO" shall mean, for any period of
determination, the ratio of (i) Net Cash Flow, to (ii) Debt Service, calculated
on a trailing twelve (12) month basis, except as expressly provided in Section
6.13(a).
"DEBT SERVICE RESERVE ACCOUNT" shall mean the special account
designated by that name and established by the Administrative Agent pursuant to
the Deposit Account Agreement.
"DEBT SERVICE RESERVE REQUIREMENT" shall mean $45,000,000.
"DEFAULT" shall mean any condition or event which, with giving of
notice or lapse of time or both, would constitute an Event of Default.
"DEFAULT RATE" shall mean the rate determined pursuant to Section
2.06(c).
"DEPOSIT ACCOUNT AGREEMENT" shall mean that certain Amended and
Restated Deposit Account Agreement, dated as of the Ceredo Closing Date, between
the Borrower and the Administrative Agent (for the benefit of the Secured
Parties), substantially in the form of EXHIBIT F hereto.
"DISCRETIONARY CAPITAL EXPENDITURES" shall mean all capital
expenditures which are not Non-Discretionary Capital Expenditures.
"DISTRIBUTION" shall mean any payment or other distribution of assets,
properties, cash, rights, obligations or securities to any Person constituting
Estimated Income Taxes or otherwise in respect of such Person's equity ownership
interest in the Borrower or on account of any Permitted Equity Owner Loans.
"DISTRIBUTION ACCOUNT" shall mean the special account designated by
that name and established by the Administrative Agent pursuant to the Deposit
Account Agreement.
"DISTRIBUTION HOLDBACK ACCOUNT" shall mean the special account
designated by that name and established by the Administrative Agent pursuant to
the Deposit Account Agreement.
"DLC" shall mean Duquesne Light Company Inc., a Pennsylvania
corporation.
"DLC CONSENT" shall mean that certain consent and acknowledgment
agreement among DLC, the Administrative Agent and the Borrower in regard to the
DLC Documents in form and substance reasonably acceptable to the Arrangers.
"DLC DOCUMENTS" shall mean the collective reference to the Acquisition
Agreement, the DLC Interconnection Agreements, the DLC Must-Run Agreements, the
POLR Agreement, the POLR II Agreement and the DLC Easement and Attachment
Agreement.
"DLC EASEMENT AND ATTACHMENT AGREEMENTS" shall mean the Easement,
License and Attachment Agreements to be entered into between the Borrower and
DLC in substantially the form attached as Exhibit D.1 to the Acquisition
Agreement.
"DLC INTERCONNECTION AGREEMENTS" shall mean the Connection and Site
Agreements to be entered into between the Borrower and DLC in respect of each of
Brunot Island, Cheswick, Elrama, and Phillips in substantially the form attached
as Exhibit C.1 to the Acquisition Agreement.
"DLC LETTER OF CREDIT" shall mean one or more irrevocable standby
letters of credit, substantially in the form of EXHIBIT M hereto issued pursuant
to Section 2.16 and satisfying the requirements set forth in the POLR Agreement
and the POLR II Agreement.
"DLC LETTER OF CREDIT AVAILABILITY PERIOD" shall mean the period from
and including the Closing Date to but excluding the earliest of (a) the date six
Business Days prior to the Final Maturity Date and (b) the termination of the
Revolving Loan Commitments in accordance with the terms hereof.
"DLC LETTER OF CREDIT DISBURSEMENT" shall mean a payment or
disbursement made by the Issuing Bank pursuant to a DLC Letter of Credit.
"DLC LETTER OF CREDIT EXPOSURE" shall mean at any time the sum of (a)
the aggregate undrawn amount of a DLC Letter of Credit, plus (b) the aggregate
amount of all DLC Letter of Credit Disbursements not yet reimbursed by the
Borrower as provided in Section 2.16. The DLC Letter of Credit Exposure of any
Revolving Lender at any time shall mean its Pro Rata Share (based on such
Revolving Lender's Revolving Loan Commitment) of the aggregate DLC Letter of
Credit Exposure at such time.
"DLC LETTER OF CREDIT FEE" shall mean the fee payable to the Issuing
Bank and the Revolving Lenders pursuant to Section 2.16(f).
"DLC MUST-RUN AGREEMENTS" shall mean the Must-Run Agreements to be
entered into between the Borrower and DLC in respect of each of Cheswick and
Elrama in substantially the form attached as Exhibit E to the Acquisition
Agreement.
"DOCUMENTATION AGENTS" shall have the meaning ascribed thereto in the
preamble to this Agreement.
"DUQUESNE CONTROL AREA" shall mean the electric system or systems
owned or operated by DLC, bounded by interconnection metering and telemetry,
capable of controlling generation to maintain its interchange schedule with
other control areas and contributing to frequency regulation of the facilities
that connect DLC's electric system with other systems or control areas or with
non-utility generators.
"DOLLAR" and the sign "$" shall mean lawful money of the United States
of America.
"EASEMENT AND ATTACHMENT AGREEMENTS" shall mean the collective
reference to the DLC Easement and Attachment Agreement and the FE Easement and
Attachment Agreements.
"ECAR" shall mean the Eastern Central Area Reliability Council.
"EFFECTIVE DATE" shall have the meaning ascribed thereto in Section
9.06(c).
"ELRAMA" shall mean all generating units and related assets located at
the generating station known as Elrama, as more fully described on SCHEDULE
1.01(A) attached hereto, and all additions, modifications and improvements
thereto.
"EMERGENCY" shall mean a condition or situation which in the
reasonable judgment of the relevant Borrower Entity either affects or will
affect such Borrower Entity's ability to safely operate any portion of the
Portfolio Assets or the ability of any portion of the Portfolio Assets to
operate due to any sudden or unexpected mechanical breakdown or other unforeseen
event.
"ENVIRONMENTAL CLAIM" shall mean, with respect to any Person, any
written notice, claim, assertion, administrative, regulatory or judicial action,
suit, judgment, demand or other written communication by any other Person
alleging or asserting such Person's liability for investigatory costs, cleanup
costs, governmental response costs, damages to natural resources or other
property of such Person, personal injuries, fines or penalties arising out of,
based on or resulting from (a) the presence, use, Release or threatened Release
into the environment of any Hazardous Material at any location, whether or not
owned by such Person or (b) any fact, circumstance, condition or occurrence
forming the basis of any violation, or alleged violation, of any Environmental
Law. The term "Environmental Claim" shall include, without limitation, any claim
by any Governmental Authority for enforcement, cleanup, removal, response,
remedial or other actions or damages pursuant to any applicable Environmental
Law, and any claim by any third party seeking damages, contribution,
indemnification, cost recovery, compensation or injunctive relief resulting from
the presence of Hazardous Materials or arising from alleged injury or threat of
injury to health, safety or the environment.
"ENVIRONMENTAL INSURANCE POLICY" shall mean the environmental
impairment liability policy as more particularly described in Paragraph A(7) of
SCHEDULE 5.06.
"ENVIRONMENTAL LAWS" shall mean all laws, rules, regulations, codes,
ordinances, orders, decrees, judgments, injunctions, notices or binding
agreements with any Governmental Authority issued, promulgated or entered into
by any Governmental Authority, relating in any way to the environment,
preservation or reclamation of natural resources, the management, Release or
threatened Release of any Hazardous Material or to health and safety matters.
"ENVIRONMENTAL LIABILITY" shall mean any liability, contingent or
otherwise (including any liability for damages, costs of environmental
remediation, fines, penalties or indemnities, and including any Lien filed
against any Portfolio Asset in favor of any Governmental Authority), of any
Borrower Entity directly or indirectly resulting from or based upon (a)
violation of any Environmental Law, (b) the generation, use, handling,
transportation, storage, treatment or disposal of any Hazardous Materials, (c)
exposure to any Hazardous Materials, (d) the release or threatened release of
any Hazardous Materials into the environment or (e) any contract, agreement or
other consensual arrangement pursuant to which liability is assumed or imposed
with respect to any of the foregoing.
"EQUITY CONTRIBUTION AGREEMENT" shall mean that certain Equity
Contribution Agreement, dated as of the Closing Date, among the Sponsor, the
Borrower and the Administrative Agent (for the benefit of the Secured Parties),
substantially in the form of EXHIBIT L hereto.
"EQUITY CONTRIBUTION AMOUNT" shall mean $705,000,000.
"EQUITY PROCEEDS ACCOUNT" shall mean the special account designated by
that name and established by the Administrative Agent pursuant to the Deposit
Account Agreement.
"ERISA" shall mean the Employee Retirement Income Security Act of
1974, as amended from time to time.
"ERISA AFFILIATE" shall mean any trade, business or entity (whether or
not incorporated) that is treated as a member of a group described in Sections
414(b), (c), (m) or (o) of the Code or Section 4001(b) of ERISA that includes
the Borrower, or members of the same "controlled group" as the Borrower pursuant
to Section 4001(a)(14) of ERISA.
"ESTIMATED INCOME TAXES" for any period, shall mean the amount
calculated in accordance with the formula set forth on Annex III hereto.
"EVENT OF DEFAULT" shall have the meaning ascribed thereto in Article
VII hereof.
"EXTRAORDINARY PROCEEDS" shall mean the collective reference to (i)
Condemnation Proceeds, (ii) proceeds realized from the sale of assets by any
Borrower Entity pursuant to Section 6.11(c), (iii) net proceeds from the
issuance of debt (other than Permitted Equity Owner Loans and other Permitted
Indebtedness) or equity by any Borrower Entity, (iv) any liquidated damage
payments or penalties received by any Borrower Entity pursuant to any Project
Contract, (v) indemnity payments received under the Acquisition Agreement (other
than indemnity payments in respect of third party claims) and (vi) property and
casualty Insurance Proceeds, to the extent such Insurance Proceeds are not
applied to the reconstruction, repair or replacement of the affected Portfolio
Assets pursuant to the Deposit Account Agreement.
"EXTRAORDINARY PROCEEDS ACCOUNT" shall mean the special account
designated by that name and established by the Administrative Agent pursuant to
the Deposit Account Agreement.
"FE CONSENT" shall mean that certain consent and acknowledgment
agreement among the FE Subsidiaries, the Administrative Agent and the Borrower
in regard to the FE Documents in form and substance reasonably acceptable to the
Arrangers.
"FE DOCUMENTS" shall mean the collective reference to the Acquisition
Agreement, the FE Interconnection Agreements, the FE Must-Run Agreements, and
the FE Easement and Attachment Agreements.
"FE EASEMENT AND ATTACHMENT AGREEMENTS" shall mean the Easement,
License and Attachment Agreements to be entered into between the Borrower and
applicable FE Subsidiary in substantially the form attached as Exhibit D.2 to
the Acquisition Agreement.
"FE INTERCONNECTION AGREEMENTS" shall mean the Connection and Site
Agreements to be entered into between the Borrower and the applicable FE
Subsidiary in respect of each of Avon Lake, New Castle and Niles in
substantially the form attached as Exhibit C.2 to the Acquisition Agreement.
"FE MUST-RUN AGREEMENTS" shall mean the Must-Run Agreements entered
into between the Borrower and each FE Subsidiary in respect of each of Avon
Lake, New Castle and Niles in substantially the form attached as Exhibit E to
the Acquisition Agreement.
"FE SUBSIDIARIES" shall mean the collective reference to The Cleveland
Electric Illuminating Company, an Ohio corporation, Ohio Edison Company, an Ohio
corporation, and Pennsylvania Power Company, a Pennsylvania corporation.
"FEDERAL FUNDS RATE" shall mean, for any period, a fluctuating
interest rate per annum equal for each day during such period to the weighted
average of the rates on overnight federal funds transactions with members of the
Federal Reserve System arranged by federal funds brokers, as published for such
day (or, if such day is not a Business Day, for the next preceding Business Day)
by the Federal Reserve Bank of New York, or, if such rate is not so published
for any day that is a Business Day, the average of the quotations for such day
on such transactions received by the Administrative Agent from three Federal
Funds brokers of recognized standing selected by it.
"FEE SIDE LETTERS" shall mean the letter agreement or agreements,
among the Borrower, the Arrangers, the Administrative Agent, the Syndication
Agents and the Documentation Agents, or any of them.
"FEES" shall mean the Agency Fee, the Commitment Fees, the DLC Letter
of Credit Fees, the Operational Letter of Credit Fees and any other fees payable
by the Borrower to any Secured Party pursuant to any Financing Documents.
"FINAL MATURITY DATE" shall mean with respect to the Acquisition Loans
and the Revolving Loans, the earlier to occur of (i) October 28, 2002 and (ii)
the date of acceleration of any of the Loans pursuant to the terms of the
Financing Documents.
"FINANCING DOCUMENTS" shall mean the collective reference to the
Credit Agreement, the Notes, the Letters of Credit, the Security Documents, the
Interest Hedge Contracts and the Fee Side Letters.
"FINANCING STATEMENT" shall mean any UCC-1 financing statement or
other similar instrument which is filed pursuant to a Security Agreement or any
of the Mortgages to perfect the security interest purported to be created
thereby.
"FPA" shall mean the Federal Power Act of 1920.
"FUEL CONSULTANT" shall mean Pace Global Energy Services, LLC, as fuel
consultant to the Arrangers, the Lenders and the Agents, or any successor
thereto appointed by the Administrative Agent on the direction of the Required
Lenders after consultation with the Borrower.
"FUEL CONSULTANT'S REPORT" shall mean the report of the Fuel
Consultant, dated April 28, 2000.
"FUEL PLAN" shall mean the plan of the Borrower addressing the sale,
procurement, transportation, delivery and management of fuel to the Portfolio
Assets (excluding Ceredo, until it has achieved Commercial Operation) and the
disposal of ash and gypsum for the period from the Closing Date until the
conclusion of the current calendar year and a similar plan delivered in respect
of each calendar year thereafter in accordance with Section 5.24 below. The
initial Fuel Plan shall be reasonably satisfactory to the Arrangers (in
consultation with the Fuel Consultant) in all respects and subsequent Fuel Plans
shall be reasonably satisfactory to the Administrative Agent (in consultation
with the Fuel Consultant) in all respects.
"FUEL SUPPLIER" shall mean each party to a Fuel Supply Agreement
having the obligation thereunder to supply fuel to any of the Portfolio Assets.
"FUEL SUPPLY AGREEMENTS" shall mean the Acquired Fuel Supply Contracts
and other material fuel contracts existing on the Closing Date.
"FUNDING BREAKAGE COSTS" shall have the meaning ascribed thereto in
Section 2.09(c).
"GAAP" shall mean generally accepted accounting principles in effect
from time to time in the United States of America.
"GENERAL PARTNER" shall mean Orion Power MidWest GP, Inc., a Delaware
corporation and 1% general partner of the Borrower.
"GOLDMAN ENTITIES" shall mean the collective reference to GS Capital
Partners II, L.P., GS Capital Partners III, L.P., Stone Street Fund 1998, L.P.,
Bridge Street Fund 1998, L.P., GS Capital Partners II Offshore, L.P., GS Capital
Partners III Offshore, L.P., Goldman, Sachs & Co. Verwaltungs GmbH (for GS
Capital Partners II Germany C.L.P. and GS Capital Partners III Germany C.L.P.)
and any other investment fund that is an Affiliate of The Goldman Sachs Group,
Inc.
"GOVERNING DOCUMENTS" of any Person shall mean the charter and
by-laws, memorandum or articles of association, partnership agreement, operating
agreement or other organizational or governing documents of such Person.
"GOVERNMENTAL APPROVALS" shall mean any action, authorization,
certificate, consent, waiver, approval, license, franchise, lease, ruling,
permit, variance, order, right, tariff, rate, certification, exemption of or
from, and any filing or registration with, any Governmental Authority
(including, without limitation, all environmental permits) relating to the
acquisition, ownership, operation or maintenance of the Portfolio Assets or to
the execution, delivery or performance of any Project Contract by any Person
party thereto.
"GOVERNMENTAL AUTHORITY" shall mean any nation or government, any
state, county, city or other political subdivision thereof and any entity
exercising executive, legislative, judicial, regulatory or administrative
functions of, or pertaining to, government.
"GP PARTNERSHIP INTEREST PLEDGE AGREEMENT" shall mean that certain
Partnership Interest Pledge Agreement, dated as of the Closing Date, among the
General Partner, the Borrower and the Administrative Agent (for the benefit of
the Secured Parties), relating to the General Partner's interest in the
Borrower, substantially in the form of EXHIBIT I-1 hereto.
"GUARANTEE OBLIGATION" shall mean the obligation or agreement of any
Person, contingently or otherwise, to purchase or repurchase the Indebtedness
of, or assume, guaranty, endorse or otherwise become or remain liable, directly
or indirectly, for the Indebtedness, obligations, stock or dividends of any
other Person.
"HARWICK" shall mean MidWest Ash Disposal, Inc., a Delaware
corporation and a wholly-owned subsidiary of Orion Power Operating Services,
Inc. and the Sponsor.
"HARWICK ASH AGREEMENT" shall mean that certain ash handling and
leachate management contract dated April 28, 2000 by and between the Borrower
and Harwick.
"HARWICK CONSENT" shall mean that certain consent and acknowledgment
agreement among Harwick, the Administrative Agent and the Borrower relating to
the Harwick Ash Agreement, in form and substance reasonably acceptable to the
Arrangers.
"HARWICK MINE COMPLEX" shall mean the mines and subsurface rights
consisting of those certain coal mines known as the Monarch, Cornell and Old
Harwick Mines as described in the Cheswick Real Property portion of Schedule 4.9
of the Acquisition Agreement, exclusive of the Monarch Mine Dewatering Facility.
"HAZARDOUS MATERIALS" shall mean all explosive or radioactive
substances or wastes and all hazardous or toxic substances, wastes or other
pollutants, including petroleum or petroleum distillates, asbestos or asbestos
containing materials, polychlorinated biphenyls, radon gas, infectious or
medical wastes and all other substances or wastes of any nature regulated
pursuant to any Environmental Law.
"INDEBTEDNESS" of any Person shall mean:
(i) all obligations of such Person for borrowed money or for the
deferred purchase price of property or services (including, without
limitation, all obligations contingent or otherwise of such Person in
connection with acceptance, letter of credit or similar facilities and in
connection with any agreement to purchase, redeem or otherwise acquire for
value any Capital Stock of such Person, or any rights or options to acquire
such Capital Stock, now or hereafter outstanding);
(ii) all obligations of such Person evidenced by bonds, notes,
debentures or other similar instruments or securities;
(iii) all indebtedness created or arising under any sale and
leaseback arrangement, conditional sale or other title retention agreement
with respect to property owned or acquired by such Person (whether or not
the rights and remedies of the seller or lender under such agreement in the
event of default are limited to repossession or sale of such property);
(iv) all rental obligations under Capital Leases to the extent not
included in clause (iii) above;
(v) all Guarantee Obligations, all contingent reimbursement
obligations under undrawn letters of credit and all other contingent
obligations of such Person in respect of, or obligations to purchase or
otherwise acquire or to assure payment of, Indebtedness of others;
(vi) all "take or pay" obligations of such Person;
(vii) Indebtedness of others secured by any Lien upon property owned
by such Person, whether or not assumed, but only to the extent of such
property's fair market value; and
(viii) all obligations of such Person under Interest Hedge Contracts
to the extent not included in clauses (i) through (vii) above.
"INDEMNIFIED PERSON" shall have the meaning ascribed thereto in
Section 9.04.
"INDEPENDENT ENGINEER" shall mean Stone & Webster, as independent
engineer for the Arrangers, the Lenders and the Agents or any successor thereto
appointed by the Administrative Agent at the direction of the Required Lenders
after consultation with the Borrower.
"INDEPENDENT ENGINEER'S REPORT" shall mean the report of the
Independent Engineer, dated April 28, 2000.
"INSURANCE CONSULTANT" shall mean Marsh USA, Inc. as insurance
consultant to the Arrangers, the Lenders and the Agents, or any successor
thereto appointed by the Administrative Agent on the direction of the Required
Lenders after consultation with the Borrower.
"INSURANCE CONSULTANT'S REPORT" shall mean the report of the Insurance
Consultant, dated April 28, 2000.
"INSURANCE POLICIES" shall mean the policies of insurance with respect
to the ownership, operation or maintenance of the Portfolio Assets meeting the
requirements set forth in SCHEDULE 5.06.
"INSURANCE PROCEEDS" shall mean all amounts and proceeds (including
interest, if any, thereon) and instruments in respect of the proceeds of any
Insurance Policy (other than in respect of business interruption insurance)
receivable by, or for the account of, any Borrower Entity.
"INSURANCE PROCEEDS ACCOUNT" shall mean the special account designated
by that name and established by the Administrative Agent pursuant to the Deposit
Account Agreement.
"INTELLECTUAL PROPERTY" shall have the meaning ascribed thereto in
Section 4.19.
"INTERCONNECTION AGREEMENTS" shall mean the collective reference to
the DLC Interconnection Agreements and the FE Interconnection Agreements.
"INTEREST HEDGE CONTRACTS" shall mean interest rate swaps, caps,
options or other interest rate hedging mechanisms entered into by the Borrower
and reasonably approved by the Agents to provide protection against changes in
interest rates.
"INTEREST PAYMENT DATE" shall mean (i) with respect to any LIBO Rate
Loan, the last day of the Interest Period applicable to such Loan, and, in the
case of an Interest Period of more than three months' duration, each day that
would have been an Interest Payment Date had successive Interest Periods of
three months' duration been applicable to such Loan and, in addition, the date
of any refinancing or Conversion of such LIBO Rate Loan with or to a Loan of a
different Type or with a different Interest Period, (ii) with respect to any
Base Rate Loan, each Quarterly Payment Date and, in addition, the date of any
refinancing or Conversion of such Base Rate Loan with or to a Loan of a
different Type, and (iii) the Final Maturity Date.
"INTEREST PERIOD" shall mean, for each LIBO Rate Loan the period from
the date on which such LIBO Rate Loan was most recently Converted or, if not
previously Converted, on which such LIBO Rate Loan was made, to (and including)
a date selected by the Borrower in accordance with this definition and Article
II hereof.
All Loans comprising part of the same Borrowing shall have the same
Interest Period. The duration of each Interest Period for any LIBO Rate Loan
shall be 1, 3, 6 or, if available, 12 months, in each case as the Borrower may
select in the relevant Notice of Borrowing or Notice of Conversion; provided,
that:
(i) any Interest Period for any Loan which would otherwise occur on
a day other than a Business Day, the last day of such Interest Period shall
be extended to occur on the next succeeding Business Day unless such
extension would cause the last day of such Interest Period to occur in the
next following calendar month, in which case the last day of such Interest
Period shall occur on the next preceding Business Day;
(ii) any Interest Period that begins on the last Business Day of a
calendar month (or on a day for which there is no numerically corresponding
day in the calendar month at the end of such Interest Period) shall end on
the last Business Day of a calendar month; and
(iii) the Borrower may not select any Interest Period which ends after
the Final Maturity Date.
"INTERIM OPERATING BUDGET" shall mean, during the period of any
dispute described in Section 5.11(a), an Operating Budget contemplating
expenditures in an amount equal to the lesser of (i) the expenditures
contemplated in the Operating Budget in effect for the immediately preceding
calendar year (as adjusted by the current year's annual increase in the CPI over
such preceding calendar year or as further adjusted for changes in variable
costs attributable to changes in dispatch requirements during such current year)
and (ii) the expenditures contemplated in the Projections (or if delivered more
recently, the projections described in Section 5.10(c) hereof).
"INTERRUPTIBLE LOAD" shall mean, for any Person, any power supply
obligations of such Person, to the extent that any (i) interruption,
discontinuance or curtailment thereof, or (ii) any other failure to fulfill any
such obligation, will not result in any penalty, breach of contract or other
liability to any other Person.
"INVESTIGATION PLAN" shall have the meaning set forth in Section
5.21(c)(i).
"INVESTMENT" shall mean, with respect to any Person, any direct or
indirect advance, loan or other extension of credit or capital contribution by
such Person (by means of transfers of property to others or payments for
property or services for the account or use of others, or otherwise) to any
other Person, or any direct or indirect purchase or other acquisition by such
Person of, or of a beneficial interest in, capital stock, bonds, notes,
debentures or other securities issued by any other Person.
"INVESTMENT GRADE RATING" shall mean, in respect of any nationally
recognized statistical rating organization (as such term is defined in the Rules
under the Securities Exchange Act of 1934, as amended), one of such
organization's generic categories that signifies investment grade.
"ISSUING BANK" shall mean Bank of America, N.A., in its capacity as
the issuer of the DLC Letter of Credit and any Operational Letters of Credit,
and its successors in such capacity.
"KNOWN CONDITIONS LIST" shall mean those Pollution Conditions
identified in the reports and documents set forth on SCHEDULE 1.01(B).
"LENDER" shall have the meaning ascribed thereto in the preamble to
this Agreement.
"LETTER OF CREDIT EXPOSURE" shall mean at any time the sum of (a) the
DLC Letter of Credit Exposure, plus (b) the Operational Letter of Credit
Exposure.
"LETTERS OF CREDIT" shall mean the DLC Letter of Credit and all
Operational Letters of Credit.
"LIBO LENDING OFFICE" shall mean, with respect to any Lender, the
office of such Lender specified as its "LIBO Lending Office" opposite its name
on ANNEX I hereto, as such annex may be amended from time to time, or such other
office of an Affiliate of such Lender as such Lender may from time to time
specify to the Borrower and the Administrative Agent.
"LIBO RATE" shall mean, with respect to any LIBO Rate Loan for any
Interest Period, the rate per annum (rounded upwards, if necessary, to the
nearest 1/100 of 1%) appearing on Dow Jones Market Page 3750 (or any successor
page) as the London interbank offered rate for deposits in dollars at
approximately 11:00 a.m. (London time) two Business Days prior to the first day
of such Interest Period for a term comparable to such Interest Period. If for
any reason such rate is not available, the term "LIBO Rate" shall mean, for any
LIBO Rate Loan for any Interest Period, the rate per annum (rounded upwards, if
necessary, to the nearest 1/100 of 1%) appearing on Reuters Screen LIBO Page as
the London interbank offered rate for deposits in dollars at approximately 11:00
a.m. (London time) two Business Days prior to the first day of such Interest
Period for a term comparable to such Interest Period; PROVIDED, THAT, if more
than one rate is specified on Reuters Screen LIBO Page, the applicable rate
shall be the arithmetic mean of all such rates.
"LIBO RATE ADVANCE" shall mean an Advance which bears interest based
upon the LIBO Rate.
"LIBO RATE LOAN" shall mean a Loan consisting of simultaneous LIBO
Rate Advances from each of the applicable Lenders.
"LIBO RATE MARGIN" shall mean, during the period, (i) from the Closing
Date to the date twelve (12) months thereafter, 1.3750%, (ii) from and including
the date twelve (12) months after the Closing Date until the date twenty-four
(24) months thereafter, 1.50% and (iii) from and including the date twenty-four
(24) months after the Closing Date until and including the Final Maturity Date,
2.00%.
"LIEN" shall mean any mortgage, deed of trust, pledge, security
interest, encumbrance, lien, option, restriction, charge or deposit arrangement
or other arrangement having the practical effect of the foregoing or other
preferential arrangement of any other kind and shall include the interest of a
vendor or lessor under any conditional sale agreement, Capital Lease or other
title retention agreement.
"LIMITED PARTNER" shall mean Orion Power MidWest LP, Inc., a Delaware
corporation and 99% limited partner of the Borrower.
"LOAN PROCEEDS ACCOUNTS" shall mean the special account designated by
that name and established by the Administrative Agent pursuant to the Deposit
Account Agreement.
"LOANS" shall mean the Acquisition Loans and the Revolving Loans, or
any of them, as the case may be.
"LP PARTNERSHIP INTEREST PLEDGE AGREEMENT" shall mean that certain
Partnership Interest Pledge Agreement, dated as of the Closing Date, among the
Limited Partner, the Borrower and the Administrative Agent (for the benefit of
the Secured Parties), relating to the Limited Partner's interest in the
Borrower, substantially in the form of EXHIBIT I-2 hereto.
"MAINTENANCE CAPITAL EXPENDITURES" shall mean all items identified as
capital expenditures in an Operating Budget (as administered pursuant to Section
5.11 hereof) which are necessary to maintain the Portfolio Assets (excluding
Ceredo, until it has achieved Commercial Operation) in accordance with the O&M
Plan and Prudent Industry Practice.
"MAINTENANCE EXPENDITURES" shall mean any amounts from time to time
paid by any Borrower Entity (excluding amounts paid by Twelvepole, until Ceredo
has achieved Commercial Operation) in respect of labor, materials and other
direct expenses for any major maintenance procedure for any Portfolio Asset
which requires significant disassembly or shutdown of such Portfolio Asset
pursuant to manufacturers' guidelines or recommendations, engineering or
operating considerations or the requirements of any applicable Requirement of
Law.
"MAJOR PROJECT PARTY" shall mean the collective reference to DLC, each
FE Subsidiary, CPS, the Operator, Harwick and each other Person from time to
time party to a Project Contract.
"MARGIN STOCK" shall have the meaning ascribed thereto in Regulation
U.
"MATERIAL ADVERSE EFFECT" shall mean a material adverse effect on (i)
the ability of any Credit Party or any Major Project Party to perform their
respective obligations under any Transaction Document to which it is a party;
(ii) the legality, validity or enforceability of any Transaction Document; (iii)
the performance, operations, prospects, business, property, assets, liabilities
or financial condition of the Borrower Entities or of the Portfolio Assets taken
as a whole (provided, however, that when the term "Material Adverse Effect" is
used as contemplated in Section 3.03, the phrase "taken as a whole" shall apply
only to Ceredo and Twelvepole); or (iv) the rights or interests of the Secured
Parties under the Financing Documents, including, without limitation, any
security interest in the Collateral granted pursuant thereto.
"MATERIAL PLAN" shall mean at any time a Plan or Plans having
aggregate Unfunded Liabilities in excess of $10,000,000.
"MAXIMUM ACQUISITION LOAN AMOUNT" shall mean $1,110,000,000.
"MAXIMUM PERMITTED DISTRIBUTION AMOUNT" shall mean $175,000,000.
"MAXIMUM REVOLVING LOAN AMOUNT" shall mean $90,000,000.
"MONARCH MINE DEWATERING FACILITY" shall mean the wastewater
collection, treatment and discharge facilities, including without limitation any
and all improvements, structures, or equipment, used in the collection,
treatment and discharge of wastewater that is located in the Township of
Indiana, County of Allegheny, Pennsylvania on the real property described as the
"Parcel Third" in the Cheswick facility real property description found at
Schedule 4.9 to the Acquisition Agreement.
"MOODY'S" shall mean Moody's Investors Service, Inc., and its
successors.
"MORTGAGES" shall mean the collective reference to (i) the Borrower
Mortgages and (ii) from and after delivery thereof, the Twelvepole Mortgage.
"MOUNTAINEER CONSENT" shall mean a consent and acknowledgment
agreement among Mountaineer Gas Company, the Administrative Agent and
Twelvepole, in regard to the Ceredo Construction and Transportation Agreement,
in form and substance reasonably satisfactory to the Arrangers.
"MULTIEMPLOYER PLAN" shall mean at any time an employee pension
benefit plan within the meaning of Section 4001(a)(3) of ERISA to which any
Borrower Entity, the Operator or any ERISA Affiliate makes, or is making or
accruing an obligation to make contributions or has within the preceding five
plan years made contributions, including for these purposes any Person which
ceased to be an ERISA Affiliate during such five year period.
"MUST-RUN AGREEMENTS" shall mean the collective reference to the DLC
Must-Run Agreements and the FE Must Run Agreements.
"NET CASH FLOW" shall mean for any period, the amount, if any, by
which Revenues for such period exceed Operating Costs for such period.
"NEW CASTLE" shall mean all generating units and related assets
located at the generating station known as New Castle, as more fully described
on SCHEDULE 1.01(A) hereto, and all additions, modifications and improvements
thereto.
"NILES" shall mean all generating units and related assets located at
the generating station known as Niles, as more fully described on SCHEDULE
1.01(A) hereto, and all additions, modifications and improvements thereto.
"NON-DISCRETIONARY CAPITAL EXPENDITURES" shall mean, for any given
period, all amounts actually paid by any Borrower Entity (excluding Twelvepole,
until Ceredo has achieved Commercial Operation) in respect of Replacement
Capital Expenditures, Maintenance Capital Expenditures, and other capital
expenditures necessary to maintain the Portfolio Assets in accordance with
Requirements of Law (including Environmental Laws), Prudent Industry Practice or
any material Project Contract.
"NON-OWNED COVERED LOCATIONS SCHEDULE" shall mean the "Non-Owned
Covered Locations Schedule" attached to and made a part of the Environmental
Insurance Policy.
"NON-RECOURSE PARTY" shall have the meaning ascribed thereto in
Section 9.16.
"NOTES" shall mean the collective reference to the Acquisition Loan
Notes and the Revolving Loan Notes.
"NOTICE DATE" shall have the meaning ascribed thereto in Section
2.09(d).
"NOTICE OF ACQUISITION BORROWING" shall have the meaning ascribed
thereto in Section 2.03(a).
"NOTICE OF BORROWING" shall mean a Notice of Acquisition Borrowing or
a Notice of Revolving Borrowing, as the context requires.
"NOTICE OF CONVERSION" shall have the meaning ascribed thereto in
Section 2.04.
"NOTICE OF REVOLVING BORROWING" shall have the meaning ascribed
thereto in Section 2.03(b).
"O&M AGREEMENT" shall mean that certain Operation and Maintenance
Agreement, dated as of April 28, 2000 between the Borrower and the Operator.
"O&M PLAN" shall mean the plan of the Borrower (delivered to the
Arrangers on or before the Closing Date) addressing the operation and
maintenance of the Portfolio Assets (excluding Ceredo, until it has achieved
Commercial Operation) that is reasonably satisfactory to the Arrangers (in
consultation with the Independent Engineer) in all respects, as the same may be
amended from time to time by the Borrower with the prior written consent of the
Arrangers (in consultation with the Independent Engineer), such consent not to
be unreasonably withheld, delayed or conditioned.
"OBLIGATIONS" shall mean (i) all principal, interest, fees and other
liabilities payable from time to time by the Credit Parties to the Secured
Parties under the Financing Documents (including, without limitation, those
payable with respect to any Loan, the DLC Letter of Credit and any Operational
Letters of Credit) as well as all other indebtedness, obligations and
liabilities (including, without limitation, guaranties and other contingent
liabilities) of the Credit Parties to the Secured Parties arising under or in
connection with any Financing Document, in each case whether now existing or
hereafter arising, (ii) all obligations under any Interest Hedge Contracts to
which a Swap Bank is a party relating to the Obligations referred to in clause
(i) above, (iii) any and all sums advanced by the Secured Parties pursuant to
the Financing Documents in order to preserve the Collateral or preserve the
Administrative Agent's security interest in the Collateral and (iv) in the event
of any proceeding for the collection or enforcement of any indebtedness,
obligations or liabilities of the Credit Parties referred to above, the expenses
of retaking, holding, preparing for sale or lease, selling or otherwise
disposing of or realizing on the Collateral, or of any exercise by the Secured
Parties of their rights hereunder or under any other Financing Document,
together with attorneys' fees and disbursements and court costs.
"OPERATING ACCOUNT" shall mean the special account designated by that
name and established by the Administrative Agent pursuant to the Deposit Account
Agreement.
"OPERATING BUDGET" shall mean a budget of Revenues, Debt Service,
Non-Discretionary Capital Expenditures, Discretionary Capital Expenditures and
Operating Costs for the then current calendar year and the immediately
succeeding calendar year; and, for each full calendar year thereafter, a similar
budget for such calendar year and the immediately succeeding calendar year in
each instance, set forth on a monthly basis in each case, as such budget is
determined and administered pursuant to Section 5.11 hereof. The initial
Operating Budget shall be in form and substance satisfactory to the Arrangers
and the Borrower, and subsequent Operating Budgets shall be in form and
substance satisfactory to the Borrower and the Administrative Agent (after
consultation with the Independent Engineer).
"OPERATING COSTS" shall mean with respect to the Borrower Entities or
the Portfolio Assets (excluding Twelvepole and Ceredo, until Ceredo has achieved
Commercial Operation), for any period, the difference between (a) the sum
(without duplication) of the following amounts, in each case to the extent
disbursed in cash by, or for the benefit of, any Borrower Entity or the
Portfolio Assets during such period: (i) the sum of all salaries, employee
benefits, labor costs and other compensation expended in the operation of the
Portfolio Assets, PLUS (ii) the cost of raw materials, emissions control related
costs (including costs of required materials, supplies and chemicals relating to
operations of emission control equipment and costs of emission offsets), fuel,
fuel related taxes, fuel procurement and handling costs, ash handling costs,
permitting and licensing costs and the cost of other materials, supplies and
utilities, including the transportation costs for raw materials, fuel and such
other materials, supplies and utilities, consumed in the operation of the
Portfolio Assets, PLUS (iii) insurance premiums incurred in maintaining the
insurance coverages required by this Agreement and the other Project Contracts,
PLUS (iv) all other cash expenditures for administrative expense, operating
costs, power marketing costs (but only to the extent of the Monthly Fee payable
under (and as defined in) the Agency Agreement as in effect on the date hereof),
and energy hedging costs, ancillary service and transmission procurement costs
and expenses, professional expenses, Maintenance Expenditures and property
taxes, incurred in the operation of the Portfolio Assets, PLUS (v) all costs and
expenses paid by any Borrower Entity pursuant to any O&M Agreement, PLUS (vi)
all Non-Discretionary Capital Expenditures, PLUS (vii) all amounts paid by any
Borrower Entity in respect of any Emergency during such period and PLUS (viii)
amounts deposited into the Replacement Capital Expenditure Pre-Funding Account
and (b) amounts released from the Replacement Capital Expenditure Pre-Funding
Account during such period and used to satisfy Replacement Capital Expenditures
contemplated by the approved Operating Budget.
"OPERATIONAL LETTER OF CREDIT" shall mean any letter of credit issued
by the Issuing Bank for the account of the Borrower in accordance with the terms
of Section 2.17.
"OPERATIONAL LETTER OF CREDIT AVAILABILITY PERIOD" shall mean the
period from and including the Closing Date to but excluding the earliest of (a)
the date five Business Days prior to the Final Maturity Date and (b) the
termination of the Revolving Loan Commitments in accordance with the terms
hereof.
"OPERATIONAL LETTER OF CREDIT EXPOSURE" shall mean at any time the sum
of (a) the aggregate undrawn amount of all outstanding Operational Letters of
Credit, plus (b) the aggregate amount of all Operational Letter of Credit
Disbursements not yet reimbursed by the Borrower as provided in Section 2.17.
The Operational Letter of Credit Exposure of any Revolving Lender at any time
shall mean its Pro Rata Share (based on such Revolving Lender's Revolving Loan
Commitment) of the aggregate Operational Letter of Credit Exposure at such time.
"OPERATIONAL LETTER OF CREDIT FEE" shall mean the fee payable to the
Issuing Bank and the Revolving Lenders pursuant to Section 2.17(f).
"OPERATIONAL PLANS" shall mean the collective reference to the Fuel
Plan, the O&M Plan and the Power Marketing Plan, each as in effect from time to
time.
"OPERATOR CONSENT" shall mean that certain consent and acknowledgment
agreement, among Operator, the Administrative Agent and the Borrower relating to
the O&M Agreement, in form and substance reasonably acceptable to the Arrangers.
"OPERATOR" shall mean Orion Power Operating Services MidWest, Inc., a
Maryland corporation.
"PARTNERS" shall mean the collective reference to the General Partner
and the Limited Partner.
"PARTNERSHIP INTEREST PLEDGE AGREEMENTS" shall mean the collective
reference to the GP Partnership Interest Pledge Agreement and the LP Partnership
Interest Pledge Agreement.
"PBGC" shall mean the Pension Benefit Guaranty Corporation referred to
and defined in ERISA and any successor entity performing similar functions.
"PERMITTED DISTRIBUTION" shall have the meaning ascribed thereto in
the Deposit Account Agreement.
"PERMITTED EQUITY OWNER LOANS" shall mean any loan from the Sponsor or
any Subsidiary of the Sponsor that owns, directly or indirectly, 100% of the
partnership interests of the Borrower to the Borrower which (a) is unsecured,
(b) does not require payments of principal or interest to be made thereunder or
permit any exercise of lender remedies (including, without limitation,
acceleration of the applicable indebtedness) until after all of the Obligations
have been indefeasibly paid in full in cash, all Letters of Credit have been
cancelled or have expired and all amounts thereunder have been indefeasibly
reimbursed in full in cash and all Commitments have terminated; PROVIDED, THAT,
the Borrower may make payments of principal or interest out of amounts permitted
to be paid as equity distributions pursuant to Section 6.10 hereof and the
Deposit Account Agreement, (c) is subordinated in all respects to the
Obligations of the Borrower on, and payments in respect of principal thereof and
interest thereon are made in accordance with, the terms set forth on EXHIBIT N
hereto, and (d) is created and evidenced by documents and instruments that
contain clear legends indicating such documents and instruments are subordinated
to the Obligations pursuant to the terms of the agreement described in clause
(c) preceding.
"PERMITTED INDEBTEDNESS" shall mean (i) Indebtedness of any Borrower
Entity under the Financing Documents; (ii) from and after the Ceredo Effective
Date, Indebtedness of Twelvepole to the Borrower as evidenced by the Twelvepole
Intercompany Working Capital Note, (iii) Indebtedness in respect of operating
leases (and not Capital Leases) where payments to be made thereunder are
pursuant to an approved Operating Budget as administered pursuant to Section
5.11 hereof and the aggregate rental obligation (excluding indemnity and expense
reimbursement payments) of the Borrower Entities under all such operating leases
shall not exceed $5,000,000 at any time; (iv) Indebtedness in respect of trade
amounts payable which are incurred in the ordinary course of business and
payable within 60 days of the date incurred, but only to the extent such amounts
are incurred in connection with the operation or maintenance of the Portfolio
Assets or such Borrower Entity's interest therein and only to the extent
contemplated by the Operating Budget as administered pursuant to Section 5.11
hereof; (v) Indebtedness in respect of surety bonds incurred in connection with
the ordinary course of operation of the Portfolio Assets that does not exceed
$10,000,000 in the aggregate at any one time outstanding; (vi) Permitted Equity
Owner Loans; and (vii) "take or pay" obligations contemplated by the Fuel Plan
then in effect.
"PERMITTED INVESTMENTS" shall mean any of the following instruments or
transactions:
(i) direct obligations of the United States of America or obligations
fully guaranteed as to principal and interest by the United States of
America, maturing not later than 30 days from the date of acquisition
thereof;
(ii) certificates of deposit issued by, bankers' acceptances created
by, or time deposits with any bank or trust company which is organized
under the laws of the United States of America or any state thereof, and
having capital, surplus and undivided profits of at least $500,000,000 and
that is rated "A" or better by S&P or "A2" by Moody's maturing not later
than 30 days from the date of acquisition thereof;
(iii) commercial paper rated (on the date of acquisition thereof) A-1
or better by S&P and P-1 or better by Moody's, maturing not more than 30
days from the date of acquisition thereof;
(iv) repurchase obligations with a term of not more than thirty days
for underlying securities of the types described in clauses (i) and (ii)
above, entered into with any financial institution meeting the
qualifications specified in clause (iii) above; and
(v) investments in money market funds or money market mutual funds
sponsored by any securities broker dealer of recognized national standing
(or an affiliate thereof), having an investment policy that requires
substantially all the invested assets of such fund to be invested in
investments described in any one or more of the foregoing clauses having a
rating of "A" or better by S&P or "A2" or better by Moody's (including
money market funds for which the Administrative Agent in its individual
capacity or any of its affiliates is investment manager or adviser).
"PERMITTED LIENS" shall mean the collective reference to (i) Liens for
taxes, assessments and other governmental charges not yet due or payable, or the
validity of which are being contested in good faith by appropriate proceedings
and as to which Acceptable Reserves have been established, (ii) deposits or
pledges to secure the payment of workmen's compensation, unemployment insurance
or other social security benefits or obligations, public or statutory
obligations or other minor obligations of a like general nature incurred in the
ordinary course of business, (iii) easements, licenses, restrictions on the use
of real property and other matters affecting, or other irregularities in, title
thereto which are expressly listed or described in either the owner's or the
lender's policies of title insurance delivered on the Closing Date or the Ceredo
Effective Date, as applicable, as contemplated by Article III of this Agreement,
(iv) mechanic's, warehouseman's, carrier's, materialmen's, or other like liens
arising in the ordinary course of business securing obligations which (a) are
not yet due or (b) are being contested in good faith by appropriate proceedings
and as to which Acceptable Reserves have been established as security therefor,
(v) rights and interests of the parties as provided in the Financing Documents,
including, without limitation, Liens securing the Obligations under the Security
Documents, (vi) Liens arising out of judgments or awards, but only so long as an
appeal or proceeding for review is being prosecuted in good faith and Acceptable
Reserves have been established, (vii) deposits or pledges to secure statutory
obligations or performance of bids, tenders or contracts (other than for the
repayment of borrowed money) in the ordinary course of its business, (viii)
rights to set off or hold back amounts pursuant to the POLR Agreement or the
POLR II Agreement and (ix) purchase option rights, transfer restrictions and
similar encumbrances set forth in the Ceredo Purchase and Sale Agreement.
"PERSON" shall mean an individual, partnership, corporation, business
trust, joint stock company, trust, unincorporated association, joint venture,
Governmental Authority, limited liability company or other entity of whatever
nature.
"PHILLIPS" shall mean all generating units and related assets located
at the generating station known as Phillips, as more fully described on SCHEDULE
1.01(A) hereto, and all additions, modifications and improvements thereto.
Notwithstanding anything herein to the contrary, the parties hereto acknowledge
and agree that, as of the Closing Date, the Phillips generating station is in
cold storage and may remain in cold storage until the Borrower elects to place
such station into operation.
"PLAN" shall mean at any time an employee pension benefit plan (other
than a Multiemployer Plan) which is covered by Title IV of ERISA or subject to
the minimum funding standards under Section 412 of the Code and either (i) is
sponsored, maintained, or contributed to, by any Borrower Entity, the Operator
or any ERISA Affiliate or (ii) has at any time within the preceding five years
been sponsored, maintained, or contributed to, by any Borrower Entity, the
Operator or any Person which was at such time an ERISA Affiliate.
"POLLUTION CONDITIONS" shall have the meaning as set forth in the
Environmental Insurance Policy.
"POLR AGREEMENT" shall mean the POLR Agreement, dated as of September
24, 1999, by and between DLC and the Sponsor (as assigned to the Borrower).
"POLR II AGREEMENT" shall mean the POLR II Agreement, dated as of
April 16, 2000, by and between DLC and the Borrower.
"PORTFOLIO ASSETS" shall mean the collective reference to (i) the Avon
Lake, Brunot Island, Cheswick, Elrama, New Castle, Niles and Phillips facilities
and (ii) from and after the Ceredo Effective Date, Ceredo.
"POWER MARKET CONSULTANT" shall mean Pace Global Energy Services, LLC,
as power market consultant to the Arrangers, the Lenders and the Agents, or any
successor thereto appointed by the Administrative Agent on the direction of the
Required Lenders.
"POWER MARKET CONSULTANT'S REPORT" shall mean the report of the Power
Market Consultant, dated April 28, 2000.
"POWER MARKETING PLAN" shall mean the plan of the Borrower addressing,
among other things, the marketing and sale of power, electric capacity and/or
energy produced by the Portfolio Assets (except Ceredo, until it has achieved
Commercial Operation) and the purchase of power, electric capacity and/or energy
necessary or advisable for the performance by any Borrower Entity of its
obligations under any Project Contract, as well as an energy hedging strategy,
for the period from the Closing Date until the conclusion of the current
calendar year and a similar plan delivered in respect of each calendar year
thereafter in accordance with Section 5.24 below. The initial Power Marketing
Plan shall be reasonably satisfactory to the Arrangers (in consultation with the
Independent Engineer and the Power Market Consultant) in all respects and
subsequent Power Marketing Plans shall be reasonably satisfactory to the
Administrative Agent (in consultation with the Independent Engineer and the
Power Market Consultant) in all respects.
"PREPAYMENT ACCOUNT" shall mean the special account designated by that
name and established by the Administrative Agent pursuant to the Deposit Account
Agreement.
"PROHIBITED TRANSACTION" shall mean any transaction described in
Section 406 of ERISA which is not exempt by reason of Section 408 of ERISA or
the transitional rules set forth in Section 414(c) of ERISA and any transaction
described in Section 4975(c)(1) of the Code which is not exempt by reason of
Section 4975(c)(2) or Section 4975(d) of the Code, or the transitional rules of
Section 2003(c) of ERISA.
"PROJECT CONTRACTS" shall mean the collective reference to (i) the
Acquisition Agreement, the POLR Agreement, the POLR II Agreement (unless and
until terminated in accordance with its terms), the Must-Run Agreements, the
Easement and Attachment Agreements, the Interconnection Agreements, the O&M
Agreement, the Harwick Ash Agreement, the Agency Agreement and the Governing
Documents of the Credit Parties, (ii) from and after the Ceredo Effective Date,
the Ceredo Project Contracts, and (iii) all other material interconnection
agreements, material power marketing agreements, all material transmission
services agreements, all material easements and material rights-of-way, and all
material utility supply agreements and all Additional Contracts.
"PROJECT PARTY" shall mean the collective reference to the Major
Project Parties and each other Person which from time to time becomes a party to
a Project Contract.
"PROJECTIONS" shall mean the pro forma financial projections for the
first twenty years of operations of the Portfolio Assets in form and substance
acceptable to the Arrangers, as updated pursuant to Section 5.10(c).
"PRO RATA SHARE" shall mean (i) as to any Acquisition Lender, the
percentage set forth opposite such Lender's name on ANNEX I attached hereto
(which percentages for all such Lenders shall equal 100%), as such annex may be
amended from time to time, under the heading entitled "Pro Rata
Share--Acquisition Loan," and (ii) as to any Revolving Lender, the percentage
set forth opposite such Lender's name on ANNEX I attached hereto (which
percentages for all such Lenders shall equal 100%), as such annex may be amended
from time to time, under the heading entitled "Pro Rata Share--Revolving Loan."
"PRUDENT INDUSTRY PRACTICE" shall mean (i) with respect to a
particular time, those practices, methods, techniques, standards and acts
engaged in or approved by a significant portion of the competitive,
non-regulated fossil fuel fired electric generating industry at such time in the
reliability region in which the applicable Portfolio Assets are located, or (ii)
with respect to any matter to which clause (i) does not apply, any of the
practices, methods and acts which, in the exercise of reasonable judgment at the
time the decision was made, could have been expected to accomplish the desired
result consistent with good business practices, reliability, safety and
expedition. "Prudent Industry Practice" 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 having due regard for, among
other things, manufacturers' warranties and the requirements of any Governmental
Authority of competent jurisdiction.
"PUHCA" shall mean the Public Utility Holding Company Act of 1935, as
amended.
"QUARTERLY PAYMENT DATE" shall mean each March 31, June 30, September
30 and December 31 occurring after the Closing Date and up to, and including,
the Final Maturity Date.
"REGISTER" shall have the meaning ascribed thereto in Section 9.06(e).
"REGULATION U" shall mean Regulation U of the Board of Governors of
the Federal Reserve System as from time to time in effect and any successor
thereto.
"RELEASE" shall mean any release, spill, emission, leaking, pumping,
injection, deposit, disposal, discharge, dispersal, leaching or migration into
the indoor or outdoor environment, including the movement of Hazardous Materials
through ambient air, soil, surface water, ground water, wetlands, land or
subsurface strata.
"REMEDIAL ACTION PLAN" shall have the meaning as set forth in Section
5.21(c)(i)
"REMEDY NOTICE" shall have the meaning ascribed thereto in Article
VII.
"REPLACEMENT CAPITAL EXPENDITURE PRE-FUNDING ACCOUNT" shall mean the
special account designated by that name and established by the Administrative
Agent pursuant to the Deposit Account Agreement.
"REPLACEMENT CAPITAL EXPENDITURES" shall mean all annual budgeted
items related to the replacement of equipment at Avon Lake and Brunot Island all
as agreed on the Closing Date by the Borrower and the Arrangers, after
consultation with the Independent Engineer, and set forth in a schedule to the
approved Operating Budget delivered on the Closing Date, as such Operating
Budget is administered pursuant to Section 5.11 hereof.
"REPLACEMENT LENDER" shall have the meaning ascribed thereto in
Section 2.15.
"REQUIRED LENDERS" shall mean, at any time, Secured Parties holding
51% of the Combined Exposure at such time. For purposes of the foregoing,
"Combined Exposure" shall mean the sum of (a) the aggregate amount of
Acquisition Loans outstanding at such time, (b) the aggregate Revolving Loan
Commitments outstanding at such time, and (c) an amount equal to 10% of the
aggregate notional amount under all Interest Hedge Contracts (other than caps or
options) in effect as of the date of determination.
"REQUIREMENT OF LAW" shall mean any foreign, federal, state, local or
municipal laws, rules, orders, judgments, regulations, statutes, ordinances,
codes, or published decrees of any Governmental Authority (including any
determination of an arbitration or a court or other Governmental Authority) and
including, without limitation, all Environmental Laws.
"RESPONSIBLE OFFICER" shall mean (i) with respect to the Sponsor, its
chief executive officer, chief operating officer, chief financial officer, chief
legal officer, treasurer, and vice president-asset management; (ii) with respect
to any Subsidiary of the Sponsor, the president, treasurer, secretary or any
vice president of operations thereof; (iii) with respect to any other Person
(other than a partnership or limited liability company), the chief executive
officer, the president and any senior vice president of such Person or, with
respect to financial matters, the chief financial officer or treasurer of such
Person and (iv) with respect to any partnership or limited liability company,
the chief executive officer, the president, the treasurer and any vice president
of operations of a general partner or manager in such Person or, with respect to
financial matters, the chief financial officer or treasurer of the general
partner or manager of such partnership or limited liability company.
"REVENUE ACCOUNT" shall mean the special account designated by that
name and established by the Administrative Agent pursuant to the Deposit Account
Agreement.
"REVENUES" shall mean for any period, all cash income and receipts
derived from the ownership and ordinary course of operation of the Portfolio
Assets, including, without limitation, revenues from the sale of electricity and
other products and services (including capacity, ancillary services and thermal
energy), proceeds of business interruption insurance, revenues in respect of
forward sales and similar options to the extent received in cash by any Borrower
Entity, interest and other income earned on amounts on deposit in the Accounts
and Permitted Investments, but excluding any amounts offset or held back under
the POLR Agreement or the POLR II Agreement.
"REVOLVING ADVANCE" shall mean an advance by a Revolving Lender to the
Borrower as part of a Revolving Loan pursuant to Section 2.02(a).
"REVOLVING LENDER" shall mean each Lender that, from time to time, has
Revolving Loan Commitments outstanding or holds Revolving Loans.
"REVOLVING LOAN" shall mean a Loan consisting of simultaneous
Revolving Advances of the same Type from each of the Revolving Lenders pursuant
to Section 2.02(a).
"REVOLVING LOAN AVAILABILITY PERIOD" shall mean the period from and
including the Closing Date to but excluding the Final Maturity Date.
"REVOLVING LOAN COMMITMENT" shall mean, as to any Lender, the amount
set forth opposite such Lender's name on ANNEX I hereto under the heading
"Revolving Loan Commitments" as such annex may be amended from time to time and
as such amount may be reduced from time to time pursuant to the terms of this
Agreement or increased or reduced from time to time by assignment pursuant to
Section 9.06.
"REVOLVING LOAN FUNDING DATE" shall mean any Business Day on or after
the Closing Date and prior to the Final Maturity Date, on which the conditions
precedent contained in Section 3.02 shall have been satisfied and the Lenders
shall make Revolving Advances in accordance with the terms hereof.
"REVOLVING LOAN NOTES" shall have the meaning ascribed thereto in
Section 2.02(b)(i).
"S&P" shall mean Standard and Poor's Rating Services, and its
successors.
"SCHEDULED POLLUTION CONDITIONS" shall mean those specified known
contamination conditions set forth on the endorsement to the Environmental
Insurance Policy entitled "Specified Pollution Conditions Subject to a
Self-Insured Retention Endorsement."
"SECURED PARTIES" shall mean the Agents, the Arrangers, the Lenders,
the Swap Banks and the Issuing Bank.
"SECURITY ACCOUNT CONTROL AGREEMENT" shall mean that certain Amended
and Restated Security Account Control Agreement, dated as of the Ceredo Closing
Date, among the Borrower, the Administrative Agent and Bank of America, N.A., as
securities intermediary thereunder, substantially in the form of EXHIBIT G
hereto.
"SECURITY AGREEMENTS" shall mean the collective reference to (i) the
Borrower Security Agreement and (ii) from and after delivery thereof, the
Twelvepole Security Agreement.
"SECURITY DOCUMENTS" shall mean the collective reference to (i) the
Borrower Security Agreement, the Equity Contribution Agreement, the Security
Account Control Agreement, the Deposit Account Agreement, the Borrower Consents,
the Partnership Interest Pledge Agreements, the Financing Statements, the
Borrower Mortgages, the Stock Pledge Agreement and all other filings made
pursuant thereto, (ii) from and after the Ceredo Effective Date, the Borrower
Twelvepole LLC Interest Pledge Agreement, the Twelvepole Guarantee, the
Twelvepole Intercompany Agreement, the Twelvepole Intercompany Working Capital
Note and the Financing Statements and other filings made pursuant thereto, and
(iii) as and when required pursuant to Section 5.28, the other Ceredo Security
Documents delivered pursuant thereto.
"SETTLEMENT AMOUNT" shall mean the amount payable by the Borrower
pursuant to the terms of an Interest Hedge Contract, in connection with an early
termination, in whole or in part, thereunder.
"SPONSOR" shall mean Orion Power Holdings, Inc., a Delaware
corporation.
"SPONSOR HIGH YIELD DEBT" shall mean the 12% Senior Notes due 2010
issued by the Sponsor pursuant to an indenture dated April 27, 2000, for up to
an aggregate principal amount not to exceed $425,000,000, and on terms
satisfactory to the Arrangers.
"SPONSOR REVOLVER" shall mean the indebtedness of the Sponsor arising
pursuant to a Credit Agreement substantially in the form of the draft dated
April 27, 2000 (or as may otherwise be reasonably approved by the Arrangers) and
to be entered into among Sponsor and Fleet National Bank, Union Bank of
California, N.A., FleetBoston Robertson Stephens, Inc. and the other lenders
specified therein.
"SPOT POWER SALES AGREEMENTS" shall mean the collective reference to
the contracts or agreements for the sale of ancillary services, electric
capacity and/or energy requiring delivery thereof by the Borrower Entities on an
hour-forward or day-forward basis, and:
(i) during June, July and August, any such contract or agreement
in respect of up to 300 MW on an up to seven-day firm-forward basis;
and
(ii) during all months other than June, July and August, any such
contract or agreement in respect of (A) up to 200 MW on an up to and
including 180 day firm-forward basis, and (B) up to 400 MW on an up to
and including 30 day firm-forward basis; PROVIDED, THAT, in no event
shall more than 400 MW be deliverable on more than a one-day
firm-forward basis.
"STOCK PLEDGE AGREEMENT" shall mean that certain Stock Pledge
Agreement, dated as of the Closing Date, among Sponsor, the General Partner, the
Limited Partner and the Administrative Agent (for the benefit of the Secured
Parties), substantially in the form of EXHIBIT O hereto.
"SUBSIDIARY" shall mean with respect to any Person, any corporation or
other legal entity of which a majority of the Capital 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 persons performing similar
functions are at the time directly or indirectly owned by such Person.
"SWAP BANKS" shall mean any Lender from time to time party to an
Interest Hedge Contract.
"SWAP TRIGGER EVENT" shall mean that the ten year treasury rate shall
be greater than 7% for any period of three (3) consecutive days.
"SYNDICATION AGENTS" shall have the meaning ascribed thereto in the
preamble of this Agreement.
"TAXES" shall have the meaning ascribed thereto in Section 2.12(a).
"TOTAL CAPACITY" for any period, shall mean an amount of electric
capacity, calculated in megawatts, equal to (i) the total capacity of the
Portfolio Assets (other than Phillips or Ceredo, unless and to the extent
Phillips or Ceredo, respectively, is operational), PLUS all capacity purchases
and options to call on capacity from Acceptable Capacity Providers for physical
delivery to any Borrower Entity during such period pursuant to any Approved
Power Purchase Agreement; MINUS (ii) the sum of (x) the greater of (a) capacity
lost as a result of unplanned outages, (b) 600 MW or (c) the capacity of the
largest individual unit, or group of related units, to the extent not operable
on a stand alone basis, PLUS (y) all megawatts subject to planned outages during
such period.
"TOTAL LOAD FORECAST" for any period, shall mean an amount of electric
capacity, calculated in megawatts, equal to (i) the sum of the capacity required
to be delivered by DLC as the POLR provider in Duquesne Control Area during such
period, PLUS all capacity sales and options to sell capacity to Approved
Capacity Purchasers for the delivery by the Borrower of such capacity during
such period pursuant to any Approved Power Sales Agreement or otherwise in
accordance with the then current Power Marketing Plan (other than pursuant to
Spot Power Sales Agreements), MINUS (ii) the sum of (A) all Interruptible Load
of the Borrower and (B) all capacity described in clause (i) of this definition
to be provided by Electric Generation Suppliers for such period and for which
the Borrower has no obligation to supply under the POLR Agreement or the POLR II
Agreement, as the case may be.
"TOTAL VOTING POWER" with respect to any Person on any date shall mean
the total number of votes which may be cast in the election of directors of such
Person at any meeting of stockholders of such Person if all securities entitled
to vote in the election of directors of such Person (on fully diluted basis,
assuming the exercise, conversion or exchange of all rights, warrants, options
and securities outstanding on such date which are or may thereafter become
exercisable for, exchangeable for or convertible into, such voting securities)
were present and voted at such meeting (other than votes that may be cast only
upon the happening of a contingency).
"TRANSACTION DOCUMENTS" shall mean the collective reference to the
Financing Documents, the Project Contracts, the Acquisition Documents, the
Twelvepole Acquisition Agreement and the Operational Plans.
"TRANSFER" shall mean any sale, transfer, assignment, hypothecation,
pledge or other disposition, and, when used as a verb shall have a correlative
meaning.
"TWELVEPOLE" shall mean Twelvepole Creek, LLC, a Delaware limited
liability company and a single-purpose entity created for the purpose of
constructing, owning and operating Ceredo.
"TWELVEPOLE ACQUISITION AGREEMENT" shall mean that certain Stock
Purchase Agreement, dated September 29, 2000, by and between the Sponsor and
Columbia Energy Group.
"TWELVEPOLE CONSTRUCTION ACCOUNT" shall mean the special account
designated by that name and established by the Administrative Agent pursuant to
the Deposit Account Agreement.
"TWELVEPOLE GUARANTEE" shall mean a Subsidiary Guarantee Agreement,
dated as of the Ceredo Effective Date, from Twelvepole in favor of the
Administrative Agent (for the benefit of the Secured Parties), in the form of
Exhibit P hereto.
"TWELVEPOLE INTERCOMPANY AGREEMENT" shall mean an Intercompany Working
Capital Agreement, dated as of the Ceredo Effective Date, substantially in the
form of Exhibit Q hereto.
"TWELVEPOLE INTERCOMPANY WORKING CAPITAL NOTE" shall mean an
Intercompany Working Capital Note of Twelvepole, payable to the order of the
Borrower, dated as of the Ceredo Effective Date, substantially in the form of
Exhibit R hereto.
"TWELVEPOLE MORTGAGE" shall mean a Mortgage, Security Agreement,
Fixture Filing and Assignment of Leases and Rents executed and delivered by
Twelvepole in favor of the Administrative Agent (for the benefit of the Secured
Parties) in respect of real property located in Wayne County, West Virginia
which is owned or leased by Twelvepole (including, subject to the provisions of
Section 6.11 hereof, all present and future real property interests of
Twelvepole in Ceredo), in form and substance reasonably satisfactory to the
Arrangers.
"TWELVEPOLE OPERATING AGREEMENT" shall mean the Operating Agreement of
Twelvepole entered into by Columbia Electric Limited Holdings Corporation and
Columbia Electric Ceredo Corporation dated November 5, 1999, as amended and/or
restated in accordance with Section 3.03(e).
"TWELVEPOLE SECURITY AGREEMENT" shall mean an Assignment and Security
Agreement, between Twelvepole and the Administrative Agent (for the benefit of
the Secured Parties), substantially in the form of Exhibit S hereto.
"TWELVEPOLE SUPPLEMENTAL AGREEMENT" shall mean an agreement between
Twelvepole and the Administrative Agent (for the benefit of the Secured
Parties), substantially in the form of Exhibit T hereto.
"TYPE" of any Loan shall mean, as the context requires, a Base Rate
Loan or a LIBO Rate Loan.
"UNFUNDED LIABILITIES" shall mean, with respect to any Plan at any
time, the amount (if any), by which (i) the value of all benefit liabilities
under such Plan, determined on a plan termination basis using the assumptions
prescribed by the PBGC for purposes of Section 4044 of ERISA, exceeds (ii) the
fair market value of all Plan assets allocable to such liabilities under Title
IV of ERISA (excluding any accrued but unpaid contributions), all determined as
of the then most recent valuation date for such Plan, but only to the extent
that such excess represents a potential liability of the Borrower or an ERISA
Affiliate to the PBGC or any other Person under Title IV of ERISA.
"WAYNE COUNTY COMMISSION CONSENT" shall mean a consent and
acknowledgement agreement and estoppel letter among The County Commission of
Wayne County, West Virginia, the Administrative Agent and Twelvepole, relating
to the Ceredo Lease Agreement and the Twelvepole Mortgage, in form and substance
reasonably acceptable to the Arrangers.
Section 1.02 ACCOUNTING TERMS. All accounting terms not specifically
defined herein shall be construed in accordance with GAAP, and all financial
data required to be delivered hereunder shall be prepared in accordance with
GAAP.
Section 1.03 COMPUTATION OF TIME PERIODS. Except as otherwise provided
herein, 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 words "to" and "until" each means "to but excluding".
Section 1.04 RULES OF CONSTRUCTION. When used in this Agreement: (a)
"or" is not exclusive; (b) a reference to a Requirement of Law includes any
amendment or modification to such Requirement of Law; (c) a reference to a
Person includes its permitted successors and permitted assigns; and (d) a
reference to an agreement, instrument or document shall include such agreement,
instrument or document and all exhibits and schedules thereto as the same may be
amended, modified or supplemented from time to time in accordance with its terms
and as permitted by the Financing Documents.
ARTICLE II
CREDIT FACILITIES
Section 2.01 ACQUISITION LOANS.
(a) ACQUISITION LOAN COMMITMENTS
(i) Subject to the terms and conditions of this Agreement and
relying on the representations and warranties set forth herein, each
Acquisition Lender severally agrees to make an Acquisition Loan
Advance to the Borrower on the Closing Date in an amount equal to its
Pro Rata Share of the Acquisition Loan requested to be made on such
date, but in no event shall any Acquisition Loan Advance made by any
Acquisition Lender on any date exceed such Acquisition Lender's
Acquisition Loan Commitment as of such date. The aggregate amount of
all Acquisition Loan Advances made by the Acquisition Lenders
hereunder shall not in any event exceed the Maximum Acquisition Loan
Amount. Each Acquisition Lender's Acquisition Loan Commitment shall
terminate at 5:00 p.m. (New York time) on the Closing Date. Once
prepaid or repaid, an Acquisition Loan cannot be reborrowed.
(ii) The failure of any Acquisition Lender to make the
Acquisition Loan Advance to be made by it as part of the Acquisition
Loan shall not relieve, in and of itself, any other Acquisition Lender
of its obligation hereunder to make its Acquisition Loan Advance on
the date of the Acquisition Loan, but no Acquisition Lender shall be
responsible for the failure of any other Acquisition Lender to make
the Acquisition Loan Advance to be made by such other Acquisition
Lender on the date of the Acquisition Loan.
(b) ACQUISITION LOAN NOTES.
(i) All Acquisition Loan Advances made by each Acquisition Lender
shall be evidenced by the Acquisition Loan Note of the Borrower in the
form of EXHIBIT A hereto (each an "ACQUISITION LOAN NOTE" and,
collectively, the "ACQUISITION LOAN NOTES"), dated the Closing Date,
payable to the order of such Lender for the account of its Applicable
Lending Office in an aggregate principal amount equal to its Pro Rata
Share of the Maximum Acquisition Loan Amount and otherwise duly
completed. Each Acquisition Loan Note shall (A) represent the
Borrower's obligation to pay the aggregate unpaid principal amount of
all outstanding Acquisition Loan Advances made by such Acquisition
Lender, (B) be stated to mature on the Final Maturity Date, (C) bear
interest for the period from the date thereof until paid in full on
the unpaid principal amount thereof from time to time outstanding at
the applicable interest rate per annum provided in, and payable as
specified in, this Agreement, and (D) be entitled to the benefits of
this Agreement and the Security Documents.
(ii) Each Acquisition Lender is hereby authorized to record the
date and the amount of each Acquisition Loan Advance made by it and
the Type thereof and the date and amount of each payment and
prepayment of principal made with respect thereto, and all Conversions
of such Advances pursuant to Section 2.04, and prior to any Transfer
of its Acquisition Loan Note, may annotate on the schedule forming a
part thereof appropriate notations to evidence the foregoing
information with respect to each such Acquisition Loan Advance then
outstanding; PROVIDED, that, failure by such Acquisition Lender to
make any such annotation or any error therein shall not affect the
obligations of the Borrower hereunder or under such Acquisition Loan
Note in respect of such Acquisition Loan Advances evidenced thereby.
Each Acquisition Lender is hereby irrevocably authorized by the
Borrower to endorse its Acquisition Loan Note and to attach to and
make a part of its Acquisition Loan Note a continuation of such
schedule as and when required.
(c) TYPE OF ACQUISITION LOAN ADVANCES. All or any portion of
Acquisition Loan Advances shall be either Base Rate Advances or LIBO Rate
Advances and may be Converted or continued from time to time pursuant to Section
2.04.
(d) USE OF PROCEEDS OF ACQUISITION LOANS. The Borrower shall use the
proceeds of the Acquisition Loans solely to pay Acquisition Costs as
contemplated by this Agreement.
(e) REPAYMENT OF ACQUISITION LOANS. On each Quarterly Payment Date,
the Borrower shall repay the Acquisition Loans in accordance with the terms of
the Deposit Account Agreement. On the Final Maturity Date, the Borrower shall
repay the aggregate principal amount of all Acquisition Loans outstanding on
such date.
Section 2.02 REVOLVING LOANS.
(a) REVOLVING LOAN COMMITMENTS
(i) Subject to the terms and conditions of this Agreement and
relying on the representations and warranties set forth herein, each
Revolving Lender severally agrees to make Revolving Advances to the
Borrower, during the Revolving Loan Availability Period on any
Revolving Loan Funding Date, in an amount equal to its Pro Rata Share
of the Revolving Loan requested to be made on such date, but in no
event shall the sum of (x) any Revolving Advance made by any Revolving
Lender as of any date, plus (y) the aggregate principal amount of
Revolving Advances previously made by such Revolving Lender that
remain outstanding and unpaid as of such date, plus (z) such Revolving
Lender's Letter of Credit Exposure on such date, exceed such Revolving
Lender's Revolving Loan Commitment. As of any date, the aggregate
amount of all Revolving Advances made by all Revolving Lenders
hereunder and that remain outstanding and unpaid from time to time
plus the aggregate amount of all Letter of Credit Exposure on such
date, shall not in any event exceed the Maximum Revolving Loan Amount.
Unless earlier terminated in accordance herewith, the Revolving Loan
Commitments shall terminate in their entirety on the Final Maturity
Date. Subject to the terms hereof, Revolving Loans that are repaid
prior to the Final Maturity Date may be reborrowed.
(ii) The failure of any Revolving Lender to make a Revolving
Advance to be made by it as part of any Revolving Loan shall not
relieve, in and of itself, any other Revolving Lender of its
obligation hereunder to make its Revolving Advance on the date of such
Revolving Loan, but no Revolving Lender shall be responsible for the
failure of any other Revolving Lender to make the Revolving Advance to
be made by such other Revolving Lender on the date of such Revolving
Loan.
(b) REVOLVING LOAN NOTES
(i) All Revolving Advances made by each Revolving Lender shall be
evidenced by a Revolving Loan Note of the Borrower in the form of
EXHIBIT B hereto (each a "REVOLVING LOAN Note" and, collectively, the
"REVOLVING LOAN NOTES"), dated the Closing Date, payable to such
Lender for the account of its Applicable Lending Office in an
aggregate principal amount equal to its Pro Rata Share of the Maximum
Revolving Loan Amount and otherwise duly completed. Each Revolving
Loan Note shall (A) represent the Borrower's obligation to pay the
aggregate unpaid principal amount of all outstanding Revolving
Advances made by such Lender, (B) be stated to mature on the Final
Maturity Date, (C) bear interest for the period from the date thereof
until paid in full on the unpaid principal amount thereof from time to
time outstanding at the applicable interest rate per annum provided
in, and payable as specified in, this Agreement, and (D) be entitled
to the benefits of this Agreement and the Security Documents.
(ii) Each Revolving Lender is hereby authorized to record the
date and amount of each Revolving Advance made by it and the Type
thereof and the date and amount of each payment and prepayment of
principal made with respect thereto, and all Conversions of such
Advances pursuant to Section 2.04, and prior to any Transfer of its
Revolving Loan Note may annotate on the schedule forming a part
thereof appropriate notations to evidence the foregoing information
with respect to each such Revolving Advance then outstanding;
PROVIDED, THAT, failure by such Revolving Lender to make any such
annotation or any error therein shall not affect the obligations of
the Borrower hereunder or under such Revolving Loan Note in respect of
such Revolving Advances evidenced thereby. Each Revolving Lender is
hereby irrevocably authorized by the Borrower to endorse its Revolving
Loan Note and to attach to and make a part of its Revolving Loan Note
a continuation of such schedule as and when required.
(c) TYPES OF REVOLVING ADVANCES. All or any portion of any Revolving
Advances shall be either Base Rate Advances or LIBO Rate Advances, and may be
Converted or continued from time to time pursuant to Section 2.04.
(d) USE OF PROCEEDS OF REVOLVING LOANS. The Borrower shall use the
proceeds of each Revolving Loan solely to pay, or to finance the payment by
Twelvepole of, (i) Operating Costs of the Borrower Entities contemplated by the
then current Operating Budget (as administered pursuant to Section 5.11 hereof)
to the extent that funds in the Operating Account are insufficient for such
purpose, (ii) on the Closing Date, the purchase price of certain inventories,
supplies and spare parts (including coal or other fuel inventories), pro-rated
expenses (including certain Taxes), all as agreed among the Borrower and the
Arrangers on or prior to the Closing Date. In no event shall the proceeds of
Revolving Loans be used to (i) pay Acquisition Costs (except to the extent
referenced above), (ii) pay Debt Service, (iii) make Distributions, or (iv) make
a contribution to the capital of any Subsidiary of the Borrower.
(e) REPAYMENT
(i) The Borrower shall repay the principal of all outstanding
Revolving Loans in full on the Final Maturity Date.
(ii) Notwithstanding anything to the contrary in this Agreement,
for so long as the Revolving Loan Commitments are in effect, the
Borrower agrees to repay the entire principal amount of Revolving
Loans outstanding from time to time such that, for a period of ten
(10) consecutive days on a rolling twelve (12) months basis during
each calendar year in which either an Acquisition Loan Commitment or a
Revolving Loan Commitment is in effect or any Loan remains outstanding
and unpaid, there shall be no Revolving Loans outstanding under this
Agreement.
(iii) Notwithstanding anything to the contrary in this Agreement,
for so long as the Revolving Loan Commitments are in effect, the
Borrower agrees to repay the principal amount of Revolving Loans
outstanding from time to time such that on each Distribution Date (as
defined in the Deposit Account Agreement) the aggregate principal
amount of Revolving Loans outstanding PLUS the aggregate Letter of
Credit Exposure shall be equal to or less than $25,000,000.
Section 2.03 BORROWINGS
(a) ACQUISITION LOANS. The Acquisition Loan shall be made on notice
from the Borrower to the Administrative Agent, given not later than 10:00 a.m.
(New York City time) (x) on the third (3rd) Business Day prior to the proposed
Closing Date, if such Acquisition Loan is to be a LIBO Rate Loan, or (y) on the
Business Day prior to the proposed Closing Date, if such Acquisition Loan is to
be a Base Rate Loan. Such notice by the Borrower (a "NOTICE OF ACQUISITION
BORROWING") shall be irrevocable and shall be in writing in substantially the
form of EXHIBIT C, specifying therein (i) the proposed Closing Date, (ii) the
aggregate amount of the Acquisition Loan to be made on such date, (iii) the
requested Type of Acquisition Loan, (iv) the specific Acquisition Costs to be
paid with the proceeds of such Acquisition Loan, and (v) with respect to a LIBO
Rate Loan, the requested Interest Period for such Acquisition Loan. The
Administrative Agent shall give to each Acquisition Lender prompt notice of the
Notice of Acquisition Borrowing by telecopy, telex or cable. Each Acquisition
Lender shall, before 10:00 a.m. (New York City time) on the Closing Date, make
available to the Administrative Agent, for the account of its Applicable Lending
Office, in immediately available funds, the amount of such Acquisition Lender's
Acquisition Loan Advance. Subject to the Administrative Agent's receipt of such
funds and fulfillment of the applicable conditions set forth in Article III for
such Acquisition Loans, the Administrative Agent will make such funds available
to the Borrower at its account with the Administrative Agent at its Applicable
Lending Office or at such other account designated by the Borrower in the Notice
of Acquisition Borrowing.
(b) REVOLVING LOANS. Each Revolving Loan shall be made on notice from
the Borrower to the Administrative Agent, given not later than 10:00 a.m. (New
York City time) (x) on the third (3rd) Business Day prior to the proposed
Revolving Loan Funding Date, if such Revolving Loan is to be a LIBO Rate Loan,
or (y) on the Business Day prior to the proposed Revolving Loan Funding Date, if
such Revolving Loan is to be a Base Rate Loan. Such notice by the Borrower (a
"NOTICE OF REVOLVING BORROWING"), shall be irrevocable and shall be in writing
in substantially the form of EXHIBIT D, specifying therein (i) the proposed
Revolving Loan Funding Date, (ii) the requested aggregate amount of the
Revolving Loan, (iii) any specific payment instructions regarding the
disbursement of the proceeds of such Revolving Loan, (iv) the requested Type of
Revolving Loan and (v) with respect to a LIBO Rate Loan, the initial Interest
Period applicable thereto. The Notice of Revolving Borrowing shall be
accompanied by the certificates and information required by Section 3.02. The
Administrative Agent shall give each Revolving Lender prompt notice of the
Notice of Revolving Borrowing by telecopy, telex or cable. Each Revolving Lender
shall, no later than 10:00 a.m. (New York City time) on the applicable Revolving
Loan Funding Date, make available to the Administrative Agent, for the account
of its Applicable Lending Office, in immediately available funds, the amount of
such Revolving Lender's Revolving Advance. Subject to the Administrative Agent's
receipt of such funds and fulfillment of the applicable conditions set forth in
Article III for such Loans, the Administrative Agent will make such funds
available to the Borrower by depositing the proceeds of such Revolving Loan into
the Operating Account.
(c) PARTICIPATIONS. If the Administrative Agent has not received from
the Borrower the payment required by Section 2.16(g) by 12:30 p.m. (New York
City time), on the Business Day immediately following the date on which the
Issuing Bank has notified the Borrower and the Administrative Agent that payment
of a draft presented under any DLC Letter of Credit or any Operational Letter of
Credit will be made, as provided in Section 2.16(g) or 2.17(g), as applicable,
the Administrative Agent will promptly notify the Issuing Bank and each
Revolving Lender of the DLC Letter of Credit Disbursement or the Operational
Letter of Credit Disbursement, as the case may be, and, in the case of each
Revolving Lender, its Pro Rata Share (based on such Revolving Lender's Revolving
Loan Commitment) of the DLC Letter of Credit Disbursement or the Operational
Letter of Credit Disbursement, as the case may be. Not later than 10:00 a.m.
(New York City time) on the next Business Day, each Revolving Lender shall,
irrespective of the existence of any Default or Event of Default or failure of
any other applicable condition precedent, make available its Pro Rata Share of
the DLC Letter of Credit Disbursement or the Operational Letter of Credit
Disbursement, as the case may be, in Federal or other funds immediately
available in New York, New York, to the Administrative Agent at its address set
forth in Section 9.01. Any such funding of a DLC Letter of Credit Disbursement
or the Operational Letter of Credit Disbursement, as the case may be, by the
Revolving Lenders shall be considered as Revolving Advances made to the
Borrower. Any Revolving Loans made pursuant to this Section 2.03(c) shall be
made as Base Rate Loans and the Administrative Agent will promptly make such
funds available to the Issuing Bank. In the event that any Revolving Advance
cannot for any reason be made on the date otherwise required above (including,
without limitation, as a result of the commencement of a proceeding under the
Bankruptcy Code with respect to the Borrower), then each Revolving Lender shall
forthwith purchase (as of the date such Revolving Advance would otherwise have
occurred) from the Issuing Bank such Revolving Lender's Pro Rata Share of the
DLC Letter of Credit Disbursement or the Operational Letter of Credit
Disbursement, as the case may be.
Section 2.04 ELECTION OF INTEREST RATES.
(a) So long as no Default or Event of Default shall have occurred and
be continuing (and notwithstanding the existence of any Default or Event of
Default with respect to a Conversion from a LIBO Rate Loan to a Base Rate Loan),
the Borrower may from time to time elect to Convert any Loan of any Type to a
Loan of the same or any other Type on the following terms and subject to the
following conditions:
(i) Each such Conversion shall be made as to all or a portion of
the outstanding Loans, on notice given not later than 10:00 a.m. (New
York City time) on the third (3rd) Business Day prior to the date of
the proposed Conversion, in the case of any such Conversion into LIBO
Rate Loans, or on the Business Day prior to the date of the proposed
Conversion, in the case of any such Conversion into Base Rate Loans,
by the Borrower to the Administrative Agent, who shall give each
applicable Lender prompt notice thereof. Each such notice of
Conversion (a "NOTICE OF CONVERSION") shall be in writing in
substantially the form of EXHIBIT E hereto, specifying therein the
requested (A) date of such Conversion, (B) Type of, and, with respect
to LIBO Rate Loans, Interest Period applicable to, the Loans proposed
to be Converted, (C) Type of Loans to which such Loans are proposed to
be Converted, (D) in the case of a Conversion to LIBO Rate Loans,
initial Interest Period to be applicable to the Loans resulting from
such Conversion and (E) aggregate amount of Loans proposed to be
Converted. If the Notice of Conversion applies only to a portion of
the aggregate principal amount of the Loans, (X) such portion shall be
allocated ratably among the applicable Lenders and (Y) both the
portion to which the Notice of Conversion applies and the remaining
portion to which it does not apply, shall be sufficient to meet the
minimum amounts specified in Section 2.06(f). In the case of a
proposed Conversion into LIBO Rate Loans, the Administrative Agent
shall, within one Business Day of receiving the Notice of Conversion
from the Borrower, notify each applicable Lender of the interest rate
to be applicable to such LIBO Rate Loan resulting from such Conversion
pursuant to this Section 2.04.
(ii) LIBO Rate Loans may not be Converted on a date other than
the last day of the Interest Period then applicable thereto.
(iii) No Conversion may be requested by the Borrower hereunder
unless made in compliance with the definition of "Interest Period,"
Section 2.06 and Section 2.10.
(iv) Any selection by the Borrower of a longer or shorter
Interest Period to be applicable to any LIBO Rate Loan shall be deemed
a Conversion pursuant to this Section 2.04, shall be governed by the
terms and conditions hereof and shall be notified to the
Administrative Agent as herein provided. In the event the Borrower
shall fail to elect an Interest Period in respect of any LIBO Rate
Loan prior to the expiration of the then current Interest Period in
respect of such LIBO Rate Loan, then such LIBO Rate Loan shall
automatically be Converted into a Base Rate Loan in accordance with
this Section 2.04.
(b) Each Notice of Borrowing and Notice of Conversion shall be
irrevocable and binding on the Borrower. The Borrower shall indemnify each
Lender against any loss, cost or expense incurred by such Lender as a result of
any failure to fulfill, on or before the proposed date specified in such Notice
of Borrowing or Notice of Conversion, as the case may be, the applicable
conditions set forth in this Article II or Article III, including, without
limitation, any loss, cost or expense incurred by reason of the liquidation or
re-employment of deposits or other funds acquired by such Lender to fund or
Convert such Loan.
(c) So long as any Interest Hedge Contract is in effect with respect
to any Loans, the Borrower shall maintain as LIBO Rate Loans having Interest
Periods corresponding to the payment dates under such Interest Hedge Contract an
aggregate amount of Loans at least equal to the notional amount then in effect
under such Interest Hedge Contract, except to the extent the Borrower would be
prevented from complying with this Section 2.04(c) by operation of Section 2.10.
Section 2.05 FEES.
(a) COMMITMENT FEE. The Borrower shall pay to the Administrative
Agent, quarterly in arrears on each Quarterly Payment Date, for the account of
each Lender, commitment fees (the "COMMITMENT FEES") of (i) 0.375% per annum on
the average daily unutilized amount of each Acquisition Lender's Acquisition
Loan Commitment during the period from the Closing Date until, and including,
the termination of all Acquisition Loan Commitments pursuant to the terms of
this Agreement, and (ii) 0.375% per annum on the average daily unutilized amount
of each Revolving Lender's Revolving Loan Commitment during the period from the
Closing Date until, and including, the Final Maturity Date. For purposes of this
Section 2.05(a), the "unutilized amount" of a Revolving Lender's Revolving Loan
Commitment on any date shall mean the amount of such Revolving Lender's
Revolving Loan Commitment on such date, minus the sum of (X) its outstanding
Revolving Advances on such date and (Y) its Letter of Credit Exposure on such
date.
(b) AGENCY FEE. The Borrower shall pay the Agency Fee to the
Administrative Agent, for the Administrative Agent's own account, in accordance
with the terms of the Administrative Agent Fee Side Letter.
(c) LETTER OF CREDIT FEES. The Borrower shall pay (i) the DLC Letter
of Credit Fees to the applicable Persons in accordance with the terms set forth
in Section 2.16 below and (ii) the Operational Letter of Credit Fees to the
applicable Persons in accordance with the terms set forth in Section 2.17 below.
(d) OTHER FEES. The Borrower shall pay all Fees not specifically
contemplated by clauses (a) and (b) of this Section 2.05 to the appropriate
Persons in the amounts and at such times as set forth in the Fee Side Letters
and any other applicable Financing Document.
Section 2.06 INTEREST. The Borrower shall pay interest on the unpaid
principal amount of each Advance made by each Lender from the date of such
Advance until such principal amount shall be paid in full, at one of the
following rates per annum:
(a) If such Advance is a Base Rate Advance, a rate per annum equal at
all times to the sum of the Base Rate in effect from time to time plus the
Applicable Margin, payable quarterly in arrears on each applicable Interest
Payment Date and on the date that such Base Rate Advance shall be repaid in
full.
(b) If such Advance is a LIBO Rate Advance, a rate per annum equal at
all times during each Interest Period for such Advance to the sum of the LIBO
Rate for such Interest Period for such Advance plus the Applicable Margin,
payable on the applicable Interest Payment Date and on the date that such LIBO
Rate Advance shall be repaid in full.
(c) If an Event of Default shall have occurred and be continuing and
whether or not so specified in any Note, the Borrower shall pay, upon receipt of
written demand, interest on the entire principal amount of the Loans to the
extent permitted by applicable Requirements of Law, on any overdue installment
of interest and on any other amount due hereunder during such period at a rate
per annum equal at all times to 2.00% plus the LIBO Rate for such period plus
the LIBO Rate Margin for such period, if the Loans are LIBO Rate Loans or, at a
rate per annum equal to 2.00% plus the Base Rate for such period plus the Base
Rate Margin for such period, if the Loans are Base Rate Loans, which increased
interest shall be payable on the last Business Day of each month during the
continuation of such Event of Default.
(d) If the Administrative Agent is unable at any time to determine the
LIBO Rate for LIBO Rate Loans, if the Administrative Agent shall determine that
the LIBO Rate does not reflect the cost of funding LIBO Rate Loans or if any
Lender shall have determined that such Lender is unable to acquire funding in a
reasonable manner so as to make available LIBO Rate Loans in the amount and for
the Interest Period requested, the right to maintain the Loans as LIBO Rate
Loans shall be suspended at the end of the then current Interest Period and all
Loans shall be maintained as Base Rate Loans until the Administrative Agent
shall notify the Borrower and the Lenders that the circumstances causing such
suspension no longer exist.
(e) At no time shall more than six (6) different Interest Periods be
in effect as to outstanding LIBO Rate Loans hereunder.
(f) Each LIBO Rate Loan shall be in a minimum aggregate principal
amount of $1,000,000.
Section 2.07 MANDATORY PREPAYMENTS.
(a) Subject to Section 2.07(c) hereof, all Extraordinary Proceeds
received by the Administrative Agent or any Borrower Entity shall be applied to
prepay the then outstanding Acquisition Loans in accordance with the Deposit
Account Agreement, and after all Acquisition Loans have been prepaid in full,
applied to prepay then outstanding Revolving Loans in accordance with the
Deposit Account Agreement. Any prepayment of Revolving Loans required by this
Section 2.07(a) shall automatically reduce pro rata the amount of Revolving Loan
Commitments by an amount equal to the prepayment so required. Contemporaneously
with any reduction of Revolving Commitments required by this Section 2.07(a),
the Borrower shall cash collateralize with the Administrative Agent the
difference between (y) any Letter of Credit Exposure existing at such time, less
(z) the aggregate amount of the Revolving Loan Commitments existing after the
application of the terms of this Section 2.07(a), until such time as such Letter
of Credit Exposure no longer exists. Nothing in this Section 2.07(a) shall be
deemed to imply that any of the activities or actions described in clauses (ii)
or (iii) of the definition of Extraordinary Proceeds are permitted under this
Agreement other than as specifically set forth in this Agreement.
(b) In addition to the foregoing, until the Final Maturity Date, the
Borrower shall prepay the Acquisition Loans on each Quarterly Payment Date, in
the amounts set forth in and as contemplated by the Deposit Account Agreement.
(c) Notwithstanding Section 2.07(a) hereof, to the extent that
prepayment of Loans with Extraordinary Proceeds would require the Borrower to
pay Funding Breakage Costs in accordance with Section 2.09(c) below, such
Extraordinary Proceeds shall be deposited in the Extraordinary Proceeds Account
in accordance with the Deposit Account Agreement until such date(s) as the
application of such proceeds can be applied to the prepayment of Loans without
incurring such Funding Breakage Costs.
(d) In the event the interest rate on any Acquisition Loan is fixed or
capped pursuant to an Interest Hedge Contract, the Borrower shall pay all
Settlement Amounts required under such Interest Hedge Contract in connection
with any mandatory prepayment of such Loan.
(e) In addition to the foregoing, in the event of a Closing Failure,
all amounts on deposit in the Equity Proceeds Account shall, on December 31,
2000, be applied to prepay the Loans and otherwise as provided in the Deposit
Account Agreement.
Section 2.08 VOLUNTARY PREPAYMENT; TERMINATION OF COMMITMENTS;
REVOLVING COMMITMENT REDUCTIONS. (a) The Borrower may, upon at least five
Business Days' prior written notice to the Administrative 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 amounts of
the Loans in whole or ratably in part in the amount set forth in such notice,
together with accrued interest to the date of such prepayment on the principal
amount prepaid; PROVIDED, that (i) each partial prepayment shall be in a minimum
aggregate principal amount of $1,000,000 or whole multiples thereof (or, if
less, the entire balance then remaining), (ii) concurrently with such payment,
the Borrower shall pay all applicable Funding Breakage Costs in accordance with
Section 2.09(c) below and, (iii) to the extent applicable, the Borrower shall
have reduced the aggregate notional amounts of any Interest Hedge Contracts
existing on such prepayment date such that such aggregate notional amounts do
not exceed the aggregate principal amount of outstanding Loans on such date and
shall have paid any Settlement Amounts incurred in connection therewith. Each
such voluntary prepayment shall otherwise be without penalty or premium.
(b) The Revolving Loan Commitments shall be automatically terminated
on the expiration of the Revolving Loan Availability Period.
(c) Upon at least six Business Days' prior irrevocable written or
telecopy notice to the Administrative Agent, the Borrower may at any time in
whole permanently terminate, or from time to time in part permanently reduce,
the Revolving Loan Commitments; PROVIDED, THAT, (i) each partial reduction of
the Revolving Loan Commitments shall be in an aggregate principal amount which
is equal to $1,000,000 or an integral multiple thereof; (ii) concurrently with
such payment, the Borrower shall pay all applicable Funding Breakage Costs in
accordance with Section 2.09(c) below, (iii) to the extent applicable, the
Borrower shall have reduced the aggregate notional amounts of any Interest Hedge
Contracts existing on such prepayment date such that such aggregate notional
amounts do not exceed the aggregate principal amount of outstanding Loans on
such date and shall have paid any Settlement Amounts incurred in connection
therewith, and (iv) concurrently with any such reduction in the Revolving Loan
Commitments, the Borrower shall deposit with the Administrative Agent cash
collateral in an amount equal to the difference between (y) any Letter of Credit
Exposure existing at such time, less (z) the aggregate amount of the Revolving
Loan Commitments existing after the effectiveness of such reduction, until such
time as such Letter of Credit Exposure no longer exists.
(d) Each reduction in the Revolving Loan Commitments shall be made
ratably among the Revolving Lenders in accordance with their respective
Revolving Loan Commitments. The Borrower shall pay to the Administrative Agent
for the account of the Revolving Lenders, on the date of each termination or
reduction of the Revolving Loan Commitments, all accrued but unpaid Commitment
Fees on the amount of the Revolving Loan Commitments so terminated or reduced
accrued to the date of such termination or reduction.
Section 2.09 INCREASED COSTS; CAPITAL ADEQUACY; FUNDING BREAKAGE
COSTS.
(a) If, due to either (i) the enactment, promulgation or any change
(including any change by way of imposition of reserve requirements in the case
of LIBO Rate Loans) in any Requirement of Law or in the interpretation or
administration of any Requirement of Law by any Governmental Authority charged
with the interpretation or administration thereof on or after the date hereof or
(ii) the compliance with any guideline or request from any such Governmental
Authority (whether or not having the force of law) imposed on or after the date
hereof, there shall be any increase in the cost to any Lender of agreeing to
make or making, funding or maintaining LIBO Rate Loans, then such Lender shall
deliver to the Borrower and the Administrative Agent a certificate as to the
amount of such increased cost setting forth in reasonable detail the basis for
calculation thereof as soon as practicable but in no event later than one
hundred twenty (120) days after such Lender has actual knowledge of the event
(the date that is 120 days from the date any Lender obtains actual knowledge of
any such event being referred to herein as the "NOTICE DATE"). Within fifteen
(15) days after delivery of such certificate, the Borrower shall pay to such
Lender the amount shown as due on the certificate; provided, that the Borrower
shall not be obligated to compensate that Lender for the amount of such
increased cost incurred during the period of time from the Notice Date to the
date of actual delivery of the certificate. A certificate as to the amount of
such increased cost showing the basis therefor and the calculation thereof, in
reasonable detail, submitted to the Borrower and the Administrative Agent by
such Lender, shall be conclusive and binding for all purposes, absent manifest
error.
(b) If any Lender determines that compliance with any Requirement of
Law or regulation or with any guideline or request from any central bank or
other governmental authority (whether or not having the force of law) has the
effect of reducing the rate of return on the capital of such Lender or any
corporation controlling such Lender as a consequence of, or with reference to,
this Agreement, any Letter of Credit or such Lender's Commitments, or its making
or maintaining Loans below the rate which the Lender or any other corporation
would have achieved but for such compliance (taking into account the policies of
such Lender or corporation with regard to capital), then such Lender shall
deliver to the Borrower and the Administrative Agent a certificate setting forth
in reasonable detail the amount being charged by such Lender and the basis for
the determination of such amount as soon as practicable but in no event later
than one hundred twenty (120) days after the Notice Date in respect thereof.
Within fifteen (15) days after delivery of such certificate, the Borrower shall
pay to such Lender the amount shown as due on the certificate; provided, that
the Borrower shall not be obligated to compensate that Lender for the amount of
such charge incurred with respect to a period of time from the Notice Date to
the date of actual delivery of the certificate. A certificate as to such
amounts, submitted to the Borrower and the Administrative Agent by such Lender,
shall be conclusive and binding for all purposes, absent manifest error.
(c) If (i) any payment of principal of any LIBO Rate Loan is made
other than on the last day of the Interest Period for such Loan, as a result of
a payment or prepayment of such Loan or acceleration of the maturity of the
Notes or for any other reason or (ii) upon any failure to prepay a LIBO Rate
Loan after notice of prepayment has been given or any failure to borrow a LIBO
Rate Loan, continue a LIBO Rate Loan or convert a LIBO Rate Loan after notice of
borrowing, continuation or conversion has been given, then the Borrower shall,
upon demand by any Lender (with a copy of such demand to the Administrative
Agent), pay to the Administrative Agent for the account of such Lender any
amounts required to compensate such Lender for any additional losses, costs or
expenses which it may reasonably incur as a result of such payment, including,
without limitation, any loss, cost or expense incurred by reason of the
liquidation or reemployment of deposits or other funds acquired by any Lender to
fund or maintain such Loan. The foregoing amounts payable by the Borrower under
this Section 2.09(c) shall be referred to herein as "FUNDING BREAKAGE COSTS".
(d) Each Lender agrees to notify the Borrower and the Administrative
Agent of any circumstances that would cause the Borrower to pay additional
amounts pursuant to subsections (a) and (b) of this Section 2.09 on or prior to
the Notice Date; PROVIDED, THAT, the failure to give such notice shall not
affect the Borrower's obligation to pay any such additional amounts accrued
prior to the Notice Date or after delivery of such notice.
Section 2.10 ILLEGALITY. If the enactment, promulgation or any change
in or in the interpretation of any Requirement of Law after the Closing Date
shall make it unlawful, or any central bank or other Governmental Authority to
which any Lender is subject shall assert that it is unlawful, for any Lender or
its LIBO Lending Office to perform its obligations hereunder to make LIBO Rate
Loans or to continue to fund or maintain LIBO Rate Loans hereunder, then, on
notice thereof and demand therefor by such Lender to the Borrower through the
Administrative Agent, the obligation of such Lender to make or maintain LIBO
Rate Loans shall be suspended until such Lender shall notify the Administrative
Agent that the circumstances causing such suspension no longer exist and such
Lender shall maintain all of its Loans as Base Rate Loans.
Section 2.11 PAYMENTS AND COMPUTATIONS.
(a) The Borrower shall make each payment hereunder and under the Notes
not later than 12:00 Noon New York City time on the day when due in Dollars to
the Administrative Agent at its Applicable Lending Office in immediately
available funds. The Administrative Agent shall promptly thereafter cause to be
distributed like funds relating to the payment of principal, interest or Fees
(other than amounts payable to the Administrative Agent for Agency Fees and
expenses or to reimburse the Administrative Agent pursuant to Section 2.12)
ratably 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 distributed and applied in accordance with the terms of
subsection (b) of this Section 2.11.
(b) All payments received by the Administrative Agent in respect of
the Loans whether received under Section 2.11(a), in connection with any sale or
other realization upon the Collateral or otherwise shall be distributed and
applied in the order and in the amounts set forth in the Deposit Account
Agreement.
(c) The Borrower hereby authorizes each Lender, if and to the extent
that the Borrower has failed to pay amounts due hereunder or under any Financing
Document and as a result payment owed to such Lender is not made when due
hereunder or under any other Financing Document, to charge from time to time
against any or all of the Borrower's accounts with such Lender any amount so
due. Each Lender receiving any payment as a result of charging any such account
shall promptly notify the Administrative Agent thereof and make such
arrangements as the Administrative Agent shall request to share the benefit
thereof in accordance with Section 2.13 and the Deposit Account Agreement.
(d) All computations of (i) interest hereunder based on the LIBO Rate
or the Federal Funds Rate and (ii) Commitment Fees, shall be made by the
Administrative Agent on the basis of a year of 360 days and all computations of
interest hereunder based on the Base Rate shall be made by the Administrative
Agent on the basis of a year of 365 or 366 days, as the case may be, 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 fees are payable.
Each determination by the Administrative Agent of an interest rate hereunder
shall be conclusive and binding for all purposes, absent manifest error.
(e) Except as contemplated by the definition of "Interest Period" for
LIBO Rate Loans, whenever any payment hereunder or under any Financing Document
shall be stated to be due on a day other than a Business Day, such payment shall
be made on the first Business Day preceding such required payment date.
(f) Unless the Administrative Agent shall have received notice from
the Borrower prior to the date on which any payment is due to a Secured Party
hereunder that the Borrower will not make such payment in full, the
Administrative Agent may, but shall not be required to, assume that the Borrower
has made such payment in full to the Administrative Agent on such date and the
Administrative Agent may, in reliance upon such assumption, but shall not be
required to, cause to be distributed to each Secured Party on such due date an
amount equal to the amount then due such Secured Party. If and to the extent the
Borrower shall not have so made such payment in full to the Administrative
Agent, each Lender shall repay to the Administrative Agent forthwith on demand
such amount distributed to such Lender together with interest thereon, for each
day from the date such amount is distributed to such Lender until the date such
Lender repays such amount to the Administrative Agent, (i) at the Federal Funds
Rate for the three Business Days following demand by the Administrative Agent
and (ii) the Federal Funds Rate plus 1% for each day thereafter.
(g) Unless the Administrative Agent shall have received notice from a
Secured Party prior to the date of any Borrowing, or prior to the time of any
required payment by such Secured Party in respect of a DLC Letter of Credit
Disbursement or an Operational Letter of Credit Disbursement, as the case may
be, that such Secured Party will not make available to the Administrative Agent
such Secured Party's portion of such borrowing or payment, the Administrative
Agent may assume that such Secured Party has made such portion available to the
Administrative Agent on the date of such borrowing or payment in accordance with
Section 2.03 and the Administrative 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 Secured Party shall not have made such portion available to
the Administrative Agent, such Secured Party and the Borrower severally agree to
repay to the Administrative Agent forthwith on demand such corresponding amount
together with interest thereon, for each day from the date such amount is made
available to the Borrower or the Issuing Bank (or, if the Administrative Agent
and the Issuing Bank are the same person, from the date of such payment in
respect of a DLC Letter of Credit Disbursement or an Operational Letter of
Credit Disbursement, as the case may be), as applicable, until the date such
amount is repaid to the Administrative Agent at (i) in the case of the Borrower,
the interest rate applicable thereto pursuant to Section 2.06 or 2.16(g), as
applicable, and (ii) in the case of such Secured Party, (y) the Federal Funds
Rate for the three Business Days following demand by the Administrative Agent
and (z) the Federal Funds Rate plus 1% for each day thereafter.
Section 2.12 TAXES.
(a) Any and all payments by the Borrower hereunder or under the Notes
to or for the benefit of any Secured Party shall be made free and clear of and
without deduction for any and all present or future taxes (including, without
limitation, income, gross receipts, franchise, sales, use, personal property,
license, stamp, documentary, recording, privilege or other excise tax), levies,
imposts, deductions, charges or withholdings, together with any penalties, fines
or interest thereon, and all liabilities with respect thereto, imposed by any
Governmental Authority, excluding, income or franchise taxes measured by net
income imposed under the laws of the United States or any state, or any
political subdivision thereof, in which each such Secured Party is organized,
or, solely in the case of each such Lender, in which the Applicable Lending
Office or the principal office of such Lender is located (all such excluded net
income taxes and franchise taxes hereinafter referred to as "INCOME TAXES" and
all nonexcluded taxes, levies, imposts, deductions, charges, withholdings and
liabilities being hereinafter referred to as "TAXES"). If the Borrower shall be
required by law to deduct any Taxes from or in respect of any sum payable
hereunder or under any Note to or for the benefit of any Secured Party Lender,
(i) the sum payable shall be increased as may be necessary so that after making
all required deductions of Taxes (including deductions of Taxes applicable to
additional sums payable under this Section 2.12) such Secured Party receives an
amount equal to the sum it would have received had no such deductions been made,
(ii) the Borrower shall make such deductions and (iii) the Borrower shall pay
the full amount so deducted to the relevant taxation authority or other
authority in accordance with applicable Requirement of Law.
(b) In addition, without limiting the generality of this Section 2.12,
the Borrower agrees to pay any present or future stamp, documentary, recording,
privilege, intangible or similar taxes or any other excise or property taxes,
charges or similar levies that arise at any time or from time to time (i) from
any payment made under any and all Financing Documents, (ii) from the transfer
of the rights of any Secured Party under any Financing Documents to any other
Secured Party or (iii) from the execution or delivery by the Borrower or any
Credit Party of, or from the filing or recording or maintenance of, or otherwise
with respect to, any and all Financing Documents.
(c) The Borrower will indemnify each Secured Party for the full amount
of all Taxes (excluding any Income Taxes imposed by any jurisdiction on amounts
payable under this Section 2.12) paid by, or imposed or asserted against, such
Secured Party or any Collateral, as the case may be, and any liability
(including penalties, interest and expenses) arising therefrom or with respect
thereto, which Taxes are imposed or asserted in any manner resulting from or
relating to or arising from the execution, delivery or performance of the
Financing Documents, the Transaction Documents or the transactions contemplated
thereby, whether or not such Taxes were correctly or legally asserted by the
relevant Governmental Authority. A certificate as to the amount of such payment
or liability prepared by such Secured Party, absent manifest error, shall be
final, conclusive and binding for all purposes. Payment of this indemnification
shall be made within 30 days from the date such Secured Party makes written
demand therefor. With respect to any such Taxes for which any Secured Party is
entitled to indemnification pursuant to this paragraph, such Secured Party
agrees to cooperate with the Borrower and to provide to it such information as
may be reasonably requested by it for the purpose of establishing the
entitlement of the Borrower to a refund or credit of all or any portion of such
Taxes; provided, that, no Secured Party shall be required to provide to the
Borrower (a) copies of any of its tax or information returns or (b) any other
information which would prejudice the interests of such Secured Party (as
reasonably determined by such Secured Party, in its good faith judgment) or
which it reasonably deems to be of a confidential nature.
(d) As soon as practicable after the date of any payment of Taxes by
the Borrower or other authority to the relevant Governmental Authority, the
Borrower will deliver to the Administrative Agent (for delivery to each Lender)
at its address referred to on its signature page hereto, the original or a
certified copy of a receipt issued by such Governmental Authority evidencing
payment thereof and identifying the Taxes paid. If such receipt does not
identify such Taxes paid, and no procedure exists for identifying such Taxes
paid, the Borrower shall concurrently furnish to the Administrative Agent a
certificate, signed by a Responsible Officer of the Borrower providing such
identification. The Borrower shall compensate each Secured Party, as the case
may be, for all reasonable losses and expenses sustained by such Secured Party,
as a result of any failure by the Borrower to so furnish such original or copy
of such receipt or such certificate.
(e) If any Secured Party is not organized and existing under the laws
of the United States of America or any political subdivision thereof or therein
(a "FOREIGN SECURED PARTY"), to the extent entitled to do so under Applicable
Law, such Secured Party shall furnish to the Borrower, on the Closing Date (or
on the date on which such Foreign Secured Party first becomes a Secured Party
pursuant to Section 9.06) a duly executed certificate to the effect that such
Foreign Secured Party is entitled to receive all amounts payable under the
Financing Documents without deduction or withholding (or at a reduced rate of
deduction or withholding) on account of Taxes imposed by the United States of
America (i) pursuant to the terms of an applicable tax treaty in effect with the
United States of America (in which case such certificate shall be accompanied by
two executed copies of IRS Form W-8BEN), or (ii) under Code Section 1441(c) (in
which case such certificate shall be accompanied by two executed copies of IRS
Form W-8ECI) (such forms being the "PRESCRIBED FORMS"). If requested by the
Borrower from time to time after the Closing Date (upon the obsolescence of any
previously delivered form or otherwise), or if a new form is required by any
applicable Requirement of Law, a Foreign Secured Party shall, to the extent
required thereto under any applicable Requirement of Law, provide to the
Borrower new Prescribed Forms, in each case duly executed and completed by such
Foreign Secured Party. The Borrower shall not be required to indemnify any
Foreign Secured Party or pay any additional amounts to any Foreign Secured Party
pursuant to Sections 2.12(a), 2.12(c) or 2.12(d) to the extent that the
obligation to indemnify such Foreign Secured Party or pay such additional
amounts would not have arisen but for the failure by such Foreign Secured Party
to comply with applicable certification, information or other documentation
requirements concerning the nationality, residency, identity or connection with
the United States of such Foreign Secured Party if such compliance is required
by statute or regulation of the United States as a precondition to relief or
exemption from such amounts payable under, or for which indemnification is given
pursuant to, Sections 2.12(a), (c) or (d); PROVIDED, THAT, the Borrower shall be
required to indemnify each Foreign Secured Party to the extent that (A) any such
payment or indemnification is attributable to an enactment, promulgation or any
change in or interpretation of any Requirement of Law occurring after the date
hereof and (B) such deductions, withholding, payments or liabilities accrue
after the date on which such Secured Party timely furnishes to the Borrower all
Prescribed Forms required to be furnished by this Section 2.12(e) with respect
to such enactment, promulgation or any change in or interpretation of any
Requirement of Law.
(f) Without prejudice to the survival of any other agreement of the
Borrower hereunder, the agreements and obligations of the Borrower contained in
this Section 2.12 shall survive the payment in full of principal and interest on
the Loans hereunder and under the Notes.
Section 2.13 SHARING OF PAYMENTS. If any Lender shall obtain any
payment (whether voluntary, involuntary, through the exercise of any right of
set-off or otherwise) on account of a Loan made by it in excess of its Pro Rata
Share of payments on account of such Loan obtained by all the Lenders, such
Lender shall forthwith purchase from the other Lenders such participations in
the Loan made by it 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 such Lender
shall repay to the purchasing Lender the purchase price to the extent of such
recovery together with an amount equal to such Lender's Pro Rata 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
to the total amount so recovered. The Borrower agrees that any Lender so
purchasing a participation from another Lender pursuant to this Section 2.13
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 2.14 CHANGE OF APPLICABLE LENDING OFFICE. Without affecting
its rights under Section 2.09(a), 2.09(b), 2.10 or 2.12, each of the Lenders,
the Issuing Bank and the Administrative Agent agrees to use reasonable efforts
(consistent with its internal policy and legal and regulatory restrictions and
so long as such efforts would not be disadvantageous to it, in its sole opinion)
to designate a different Applicable Lending Office if such redesignation would
thereafter eliminate or reduce any amounts that the Borrower is required to pay
to any of the Lenders, the Issuing Bank or the Administrative Agent pursuant to
such Sections; PROVIDED, THAT, in determining, in its sole opinion, whether
designating a different Applicable Lending Office would be disadvantageous to
it, the applicable Lender, the Issuing Bank or the Administrative Agent, as the
case may be, shall disregard any direct financial loss of making such a
designation if the Borrower agrees in form and substance satisfactory to such
Lender, the Issuing Bank or the Administrative Agent, as the case may be, to
indemnify and hold such Lender, the Issuing Bank or the Administrative Agent, as
the case may be, harmless from such financial loss and PROVIDED, FURTHER, that
any out-of-pocket costs and expenses associated with such efforts shall be paid
or reimbursed by the Borrower.
Section 2.15 REPLACEMENT OF LENDERS. On each occasion that a Lender
either makes a demand for compensation pursuant to Section 2.06(d), 2.09(a),
2.09(b) or 2.12 in an amount in excess of the amount that the Borrower would
have had to pay pursuant to such Sections if such Lender's Commitments were held
by a Lender with respect to which no such amounts would then be payable pursuant
to any such Section or is unable for a period of two consecutive months to fund
or maintain LIBO Rate Loans pursuant to Section 2.10, the Borrower may, upon at
least ten (10) Business Days' prior written notice to each of such Lender and
the Administrative Agent and upon the payment by the Borrower of all applicable
assignment fees associated therewith (as set forth in Section 9.06(j) below), in
whole permanently replace the Commitment of such Lender; PROVIDED, THAT, the
Borrower shall replace such Commitment with the commitment of a commercial bank
which is reasonably satisfactory to the Administrative Agent or any other Lender
(a "REPLACEMENT LENDER"). Such Replacement Lender shall, upon the effective date
of replacement, purchase the Obligations owed to such replaced Lender for the
aggregate amount thereof and shall thereupon for all purposes become a "Lender"
hereunder. Such notice from the Borrower shall specify an effective date for the
replacement of such Lender's Commitment, which date shall not be earlier than
the tenth (10th) day after the day such notice is given. On the effective date
of any replacement of such Lender's Commitment pursuant to this Section 2.15,
the Borrower shall pay to the Administrative Agent for the account of such
Lender (i) any Fees or other amounts due to such Lender to the date of such
replacement, (ii) accrued interest on the principal amount of outstanding Loans
held by such Lender to the date of such replacement and (iii) the amount or
amounts payable to such Lender pursuant to Section 2.09(a), Section 2.09(b) or
Section 2.12, as applicable. The Borrower will be liable to such replaced Lender
for costs that such Lender may sustain or incur pursuant to Section 2.09(c) as a
direct consequence of repayment of such Lender's Loans. Upon the effective date
of repayment of any Lender's Commitment and Obligations pursuant to this Section
2.15, such Lender shall cease to be a "Lender" hereunder. No such termination of
any such Lender's Commitment and the purchase of such Lender's Loans pursuant to
this Section 2.15 shall affect (x) any liability or obligation of the Borrower
or any other Lender to such terminated Lender which accrued on or prior to the
date of such termination or (y) such terminated Lender's rights hereunder in
respect of any such liability or obligation.
Section 2.16 DLC LETTER OF CREDIT.
(a) The Borrower may request the issuance of a DLC Letter of Credit,
for the account of the Borrower, at any time during the DLC Letter of Credit
Availability Period; PROVIDED, THAT, a DLC Letter of Credit shall be issued only
if (and a request by the Borrower for the issuance of a DLC Letter of Credit
shall be deemed a representation and warranty of the Borrower that) immediately
following the issuance of the DLC Letter of Credit, (i) a DLC Letter of Credit
Exposure shall not exceed $10,000,000, and (ii) the sum of the aggregate Letter
of Credit Exposure and the aggregate principal amount of outstanding Revolving
Loans at such time shall not exceed the lesser of (y) the aggregate Revolving
Loan Commitments at such time and (z) the Maximum Revolving Loan Amount
effective as of such time.
(b) Each DLC Letter of Credit shall expire at 5:00 p.m., New York City
time, on the last day of the DLC Letter of Credit Availability Period, unless
such DLC Letter of Credit expires by its terms (or is required by Section
2.16(c) to expire) on an earlier date. Each DLC Letter of Credit shall provide
for payments of drawings in Dollars.
(c) The issuance of a DLC Letter of Credit shall be made on at least
three Business Days' prior irrevocable written or telecopy application (such
application to be delivered by 10:00 a.m., New York City time) from the Borrower
(or such shorter application period as shall be acceptable to the Issuing Bank)
to the Administrative Agent and the Issuing Bank, specifying the date of
issuance, the date on which such DLC Letter of Credit is to expire (which shall
not be later than the last day of the DLC Letter of Credit Availability Period
and shall be for such period of time as is contemplated by the form of letter of
credit attached hereto as EXHIBIT M), the amount of such DLC Letter of Credit,
the name and address of the beneficiary of such DLC Letter of Credit, and such
other information as may be necessary or desirable to complete such DLC Letter
of Credit. The Issuing Bank will give the Administrative Agent prompt notice of
the issuance and amount of a DLC Letter of Credit and the expiration date of
such DLC Letter of Credit (and the Administrative Agent shall give prompt notice
thereof to each Revolving Lender). Any DLC Letter of Credit issued hereunder
will be subject to the Uniform Customs and Practices for Documentary Credits, as
in effect from time to time.
(d) By the issuance of a DLC Letter of Credit and without any further
action on the part of the Issuing Bank, the Administrative Agent or the
Revolving Lenders in respect thereof, the Issuing Bank hereby grants to each
Revolving Lender, and each Revolving Lender hereby acquires from the Issuing
Bank, a participation in such DLC Letter of Credit equal to such Revolving
Lender's Pro Rata Share (based on such Revolving Lender's Revolving Loan
Commitment) of the aggregate amount available to be drawn under a DLC Letter of
Credit, effective upon the issuance of a DLC Letter of Credit. In consideration
and in furtherance of the foregoing, each Revolving Lender having a Revolving
Loan Commitment hereby absolutely and unconditionally agrees to pay to the
Administrative Agent, on behalf of the Issuing Bank, in accordance with Section
2.03(c), such Revolving Lender's Pro Rata Share (based on such Revolving
Lender's Revolving Loan Commitment) of a DLC Letter of Credit Disbursement made
by the Issuing Bank and not reimbursed by the Borrower when due in accordance
with Section 2.16(g); PROVIDED, THAT, the Revolving Lenders shall not be
obligated to make any such payment with respect to any wrongful DLC Letter of
Credit Disbursement made as a result of the gross negligence or willful
misconduct of the Issuing Bank.
(e) Each Revolving Lender acknowledges and agrees that its obligation
to acquire participations pursuant to Section 2.16(d) in respect of a DLC Letter
of Credit is absolute and unconditional and shall not be affected by any
circumstance whatsoever, including the occurrence and continuance of a Default
or Event of Default, and that each such payment shall be made without any
offset, abatement, withholding or reduction whatsoever (subject only to the
proviso set forth in the last sentence of Section 2.16(d)).
(f) During the DLC Letter of Credit Availability Period, from and
after the date on which a DLC Letter of Credit is issued, the Borrower shall pay
to the Administrative Agent, on each Quarterly Payment Date in each year and on
the date on which the Revolving Loan Commitments shall be terminated as provided
herein, (i) for the account of the Revolving Lenders, ratably in proportion to
their Revolving Loan Commitments, a fee on the average daily aggregate amount
available to be drawn under each DLC Letter of Credit during the preceding
quarter (or shorter period commencing with the Closing Date) at a rate per annum
equal to the applicable LIBO Rate Margin from time to time in effect during such
period pursuant to Section 2.06 and (ii) for the account of the Issuing Bank, a
fee on the average daily aggregate amount available to be drawn under each DLC
Letter of Credit during the preceding quarter (or shorter period commencing with
the Closing Date) at a rate per annum equal to 0.25%. Such fees shall be
computed on the basis of the actual number of days elapsed in a year of 360
days. Such fees shall accrue from and including the Closing Date to but
excluding the last day of the DLC Letter of Credit Availability Period. In
addition to the foregoing, the Borrower shall pay directly to the Issuing Bank,
for its account, payable within 15 days after written demand therefor by the
Issuing Bank has been received by the Borrower, the Issuing Bank's out-of-pocket
expenses and customary fees in connection with the issuance, transfer or
amendment of or payment on each DLC Letter of Credit.
(g) The Borrower hereby agrees to reimburse the Issuing Bank for any
payment or disbursement made by the Issuing Bank under each DLC Letter of
Credit, by making payment in immediately available funds to the Administrative
Agent within one Business Day after receipt of notice of such payment or
disbursement, in an amount equal to the amount of such payment or disbursement,
plus interest on the amount so paid or disbursed by the Issuing Bank, to the
extent not reimbursed prior to 12:00 p.m. (New York City time) on the date of
such payment or disbursement, from and including the date paid or disbursed to
but excluding the date the Issuing Bank is reimbursed by the Borrower therefor,
at a rate per annum equal to the rate applicable to Base Rate Revolving Loans
during such period pursuant to Section 2.06. In the event the Borrower fails to
reimburse the Issuing Bank as required by the preceding sentence, the Issuing
Bank shall so notify the Administrative Agent and such payment or disbursement
shall be reimbursed to the Issuing Bank as contemplated by Section 2.03(c) or
Section 2.16(d), as applicable. The Issuing Bank shall give the Borrower prompt
notice of each drawing under any DLC Letter of Credit, provided, that, the
failure to give any such notice shall in no way affect, impair or diminish the
Borrower's obligations hereunder. The Administrative Agent shall promptly pay
any such amounts received by it to the Issuing Bank.
(h) The Borrower's obligation to reimburse DLC Letter of Credit
Disbursements as provided in Section 2.16(g) shall be absolute, unconditional
and irrevocable and shall be performed strictly in accordance with the terms of
this Agreement under any and all circumstances, including the following:
(i) any lack of validity or enforceability of any DLC Letter of
Credit or any other Financing Document;
(ii) except as otherwise provided in clause (iv) of this Section
2.16(h), the existence of any claim, setoff, defense or other right
which the Borrower, any Affiliate or any other person may at any time
have against the beneficiary under a DLC Letter of Credit, the Issuing
Bank, the Administrative Agent, any Revolving Lender or any other
person in connection with this Agreement, any other Financing Document
or any other related or unrelated agreement or transaction;
(iii) any draft or other document presented under any DLC Letter
of Credit proving to be forged, fraudulent, invalid or insufficient in
any respect or failing to comply with the Uniform Customs and
Practices for Documentary Credits, as in effect from time to time, or
any statement therein being untrue or inaccurate in any respect;
(iv) payment by the Issuing Bank under any DLC Letter of Credit
against presentation of a draft or other document which does not
comply with the terms of such DLC Letter of Credit; PROVIDED, THAT,
such payment was not wrongfully made as a result of the gross
negligence or willful misconduct of the Issuing Bank;
(v) any amendment, waiver or consent in respect of this Agreement
or any other Financing Document; and
(vi) any other act or omission or delay of any kind or any other
circumstance or event whatsoever, whether or not similar to any of the
foregoing and whether or not foreseeable, that might, but for the
provisions of this Section 2.16(h), constitute a legal or equitable
discharge of the Borrower's obligations hereunder.
(i) It is expressly understood and agreed that, for purposes of
determining whether a wrongful payment under a DLC Letter of Credit resulted
from the Issuing Bank's gross negligence or willful misconduct, (i) the Issuing
Bank's acceptance of documents that appear on their face to comply with the
requirements of such DLC Letter of Credit, without responsibility for further
investigation, regardless of any notice or information to the contrary, (ii) the
Issuing Bank's exclusive reliance on the documents presented to it under such
DLC Letter of Credit as to any and all matters set forth therein, including the
amount of any draft presented under such DLC Letter of Credit, whether or not
the amount due to the beneficiary thereunder equals the amount of such draft and
whether or not any document presented pursuant to such DLC Letter of Credit
proves to be insufficient in any respect (so long as such document on its face
appears to comply with the requirements of the applicable DLC Letter of Credit),
and whether or not any other statement or any other document presented pursuant
to such DLC Letter of Credit proves to be forged or invalid or any statement
therein proves to be inaccurate or untrue in any respect whatsoever and (iii)
any noncompliance in any immaterial respect of the documents presented under
such DLC Letter of Credit with the terms thereof shall, in each case, be deemed
not to constitute willful misconduct or gross negligence of the Issuing Bank. It
is further understood and agreed that, notwithstanding the proviso to clause
(iv) of Section 2.16(h), the Borrower's obligation hereunder to reimburse Letter
of Credit Disbursements will not be excused by the gross negligence or willful
misconduct of the Issuing Bank to the extent that the DLC Letter of Credit
Disbursement actually discharged a liability of, or otherwise benefited, or was
recovered by, the Borrower; provided, that, the foregoing shall not be construed
to excuse the Issuing Bank from liability to the Borrower to the extent of any
direct damages suffered by the Borrower that are caused by the Issuing Bank's
gross negligence or willful misconduct in determining whether drafts and other
documents presented under the applicable DLC Letter of Credit comply with the
terms thereof.
(j) The Issuing Bank shall, promptly following its receipt thereof,
examine all documents purporting to represent a demand for payment under a DLC
Letter of Credit. The Issuing Bank shall as promptly as possible give telephonic
notification, confirmed by telex or telecopy, to the Administrative Agent and
the Borrower of such demand for payment and whether the Issuing Bank has made or
will make the DLC Letter of Credit Disbursement thereunder; PROVIDED, THAT, the
failure to give such notice shall not relieve the Borrower of its obligation to
reimburse the DLC Letter of Credit Disbursement in accordance with this Section
2.16. The Administrative Agent shall promptly give each Revolving Lender notice
thereof.
(k) The Borrower shall use each DLC Letter of Credit solely to support
its obligations under the POLR Agreement or the POLR II Agreement as required
thereby.
(l) In the event that the Borrower is required pursuant to the terms
of this Agreement to provide cash collateral in respect of the DLC Letter of
Credit Exposure, the Borrower shall deposit in an account with the
Administrative Agent, for the benefit of each Lender having a Revolving Loan
Commitment, an amount in cash equal to the DLC Letter of Credit Exposure (or
such lesser amount as shall be required hereunder or thereunder). Such deposit
shall be held by the Administrative Agent as collateral for the payment and
performance of any outstanding DLC Letter of Credit Exposure. The Administrative
Agent shall have exclusive dominion and control, including the exclusive right
of withdrawal, over such account. Moneys in such account shall be held and
applied by the Administrative Agent in accordance with the Deposit Account
Agreement.
Section 2.17 OPERATIONAL LETTERS OF CREDIT.
(a) The Borrower may request the issuance of Operational Letters of
Credit, for the account of the Borrower, at any time during the Operational
Letter of Credit Availability Period; PROVIDED, THAT, any Operational Letter of
Credit shall be issued only if (and a request by the Borrower for the issuance
of any Operational Letter of Credit shall be deemed a representation and
warranty of the Borrower that) immediately following the issuance of such
Operational Letter of Credit, (i) the Operational Letter of Credit Exposure
shall not exceed $5,000,000, and (ii) the sum of the aggregate Letter of Credit
Exposure and the aggregate principal amount of outstanding Revolving Loans at
such time shall not exceed the lesser of (y) the aggregate Revolving Loan
Commitments at such time and (z) the Maximum Revolving Loan Amount effective as
of such time.
(b) Each Operational Letter of Credit shall expire at 5:00 p.m., New
York City time, on the last day of the Operational Letter of Credit Availability
Period, unless such Operational Letter of Credit expires by its terms (or is
required by Section 2.17(c) to expire) on an earlier date. Each Operational
Letter of Credit shall provide for payments of drawings in Dollars.
(c) Each issuance of any Operational Letter of Credit shall be made on
at least three Business Days' prior irrevocable written or telecopy notice (such
notice to be delivered by 10:00 a.m., New York City time) from the Borrower (or
such shorter notice as shall be acceptable to the Issuing Bank) to the
Administrative Agent and the Issuing Bank, specifying whether such Operational
Letter of Credit is a standby letter of credit or a trade letter of credit, the
date of issuance, the date on which such Operational Letter of Credit is to
expire (which shall not be later than (i) in all events, the last day of the
Operational Letter of Credit Availability Period and (ii)(A) in the case of
standby letters of credit, subject to extension, one year after the date of
issuance of such Operational Letter of Credit and (B) in the case of trade
letters of credit, 180 days after the date of issuance of such Operational
Letter of Credit), the amount of such Operational Letter of Credit, the name and
address of the beneficiary of such Operational Letter of Credit, and such other
information as may be necessary or desirable to complete such Operational Letter
of Credit. The Issuing Bank will give the Administrative Agent prompt notice of
the issuance and amount of such Operational Letter of Credit and the expiration
date of such Operational Letter of Credit (and the Administrative Agent shall
give prompt notice thereof to each Revolving Lender). Each Operational Letter of
Credit issued hereunder will be subject to the Uniform Customs and Practices for
Documentary Credits, as in effect from time to time.
(d) By the issuance of an Operational Letter of Credit and without any
further action on the part of the Issuing Bank, the Administrative Agent or the
Revolving Lenders in respect thereof, the Issuing Bank hereby grants to each
Revolving Lender, and each Revolving Lender hereby acquires from the Issuing
Bank, a participation in such Operational Letter of Credit equal to such
Revolving Lender's Pro Rata Share (based on such Revolving Lender's Revolving
Loan Commitment) of the aggregate amount available to be drawn under such
Operational Letter of Credit, effective upon the issuance of such Operational
Letter of Credit. In consideration and in furtherance of the foregoing, each
Revolving Lender having a Revolving Loan Commitment hereby absolutely and
unconditionally agrees to pay to the Administrative Agent, on behalf of the
Issuing Bank, in accordance with Section 2.03(c), such Revolving Lender's Pro
Rata Share (based on such Revolving Lender's Revolving Loan Commitment) of each
Operational Letter of Credit Disbursement made by the Issuing Bank and not
reimbursed by the Borrower when due in accordance with Section 2.17(g);
PROVIDED, THAT, the Revolving Lenders shall not be obligated to make any such
payment with respect to any wrongful Operational Letter of Credit Disbursement
made as a result of the gross negligence or willful misconduct of the Issuing
Bank.
(e) Each Revolving Lender acknowledges and agrees that its obligation
to acquire participations pursuant to Section 2.17(d) in respect of Operational
Letters of Credit is absolute and unconditional and shall not be affected by any
circumstance whatsoever, including the occurrence and continuance of a Default
or Event of Default, and that each such payment shall be made without any
offset, abatement, withholding or reduction whatsoever (subject only to the
proviso set forth in the last sentence of Section 2.17(d)).
(f) During the Operational Letter of Credit Availability Period, the
Borrower shall pay to the Administrative Agent, on each Quarterly Payment Date
in each year and on the date on which the Revolving Loan Commitments shall be
terminated as provided herein, (i) for the account of the Revolving Lenders,
ratably in proportion to their Revolving Loan Commitments, a fee on the average
daily aggregate amount available to be drawn under all outstanding Operational
Letters of Credit during the preceding quarter (or shorter period commencing
with the Closing Date) at a rate per annum equal to the applicable LIBO Rate
Margin from time to time in effect during such period pursuant to Section 2.06
and (ii) for the account of the Issuing Bank, a fee on the average daily
aggregate amount available to be drawn under all outstanding Operational Letters
of Credit during the preceding quarter (or shorter period commencing with the
Closing Date) at a rate per annum equal to 0.25%. Such fees shall be computed on
the basis of the actual number of days elapsed in a year of 360 days. Such fees
shall accrue from and including the Closing Date to but excluding the last day
of the Operational Letter of Credit Availability Period. In addition to the
foregoing, the Borrower shall pay directly to the Issuing Bank, for its account,
payable within 15 days after written demand therefor by the Issuing Bank has
been received by the Borrower, the Issuing Bank's out-of-pocket expenses in
connection with the issuance, transfer or amendment of or payment on any
Operational Letter of Credit.
(g) The Borrower hereby agrees to reimburse the Issuing Bank for any
payment or disbursement made by the Issuing Bank under any Operational Letter of
Credit, by making payment in immediately available funds to the Administrative
Agent within one Business Day after receipt of notice of such payment or
disbursement, in an amount equal to the amount of such payment or disbursement,
plus interest on the amount so paid or disbursed by the Issuing Bank, to the
extent not reimbursed prior to 12:00 p.m. (New York City time) on the date of
such payment or disbursement, from and including the date paid or disbursed to
but excluding the date the Issuing Bank is reimbursed by the Borrower therefor,
at a rate per annum equal to the rate applicable to Base Rate Revolving Loans
during such period pursuant to Section 2.06. In the event the Borrower fails to
reimburse the Issuing Bank as required by the preceding sentence, the Issuing
Bank shall so notify the Administrative Agent and such payment or disbursement
shall be reimbursed to the Issuing Bank as contemplated by Section 2.03(c) or
Section 2.17(d), as applicable. The Issuing Bank shall give the Borrower prompt
notice of each drawing under any Operational Letter of Credit, provided, that,
the failure to give any such notice shall in no way affect, impair or diminish
the Borrower's obligations hereunder. The Administrative Agent shall promptly
pay any such amounts received by it to the Issuing Bank.
(h) The Borrower's obligation to reimburse Operational Letter of
Credit Disbursements as provided in Section 2.17(g) shall be absolute,
unconditional and irrevocable and shall be performed strictly in accordance with
the terms of this Agreement under any and all circumstances, including the
following:
(i) any lack of validity or enforceability of any Operational
Letter of Credit or any other Financing Document;
(ii) except as otherwise provided in clause (iv) of this Section
2.17(h), the existence of any claim, setoff, defense or other right
which the Borrower, any Affiliate or any other person may at any time
have against the beneficiary under any Operational Letter of Credit,
the Issuing Bank, the Administrative Agent, any Revolving Lender or
any other person in connection with this Agreement, any other
Financing Document or any other related or unrelated agreement or
transaction;
(iii) any draft or other document presented under an Operational
Letter of Credit proving to be forged, fraudulent, invalid or
insufficient in any respect or failing to comply with the Uniform
Customs and Practices for Documentary Credits, as in effect from time
to time, or any statement therein being untrue or inaccurate in any
respect;
(iv) payment by the Issuing Bank under an Operational Letter of
Credit against presentation of a draft or other document which does
not comply with the terms of such Operational Letter of Credit;
PROVIDED, THAT, such payment was not wrongfully made as a result of
the gross negligence or willful misconduct of the Issuing Bank;
(v) any amendment, waiver or consent in respect of this Agreement
or any other Financing Document; and
(vi) any other act or omission or delay of any kind or any other
circumstance or event whatsoever, whether or not similar to any of the
foregoing and whether or not foreseeable, that might, but for the
provisions of this Section 2.17(h), constitute a legal or equitable
discharge of the Borrower's obligations hereunder.
(i) It is expressly understood and agreed that, for purposes of
determining whether a wrongful payment under an Operational Letter of Credit
resulted from the Issuing Bank's gross negligence or willful misconduct, (i) the
Issuing Bank's acceptance of documents that appear on their face to comply with
the requirements of such Operational Letter of Credit, without responsibility
for further investigation, regardless of any notice or information to the
contrary, (ii) the Issuing Bank's exclusive reliance on the documents presented
to it under such Operational Letter of Credit as to any and all matters set
forth therein, including the amount of any draft presented under such
Operational Letter of Credit, whether or not the amount due to the beneficiary
thereunder equals the amount of such draft and whether or not any document
presented pursuant to such Operational Letter of Credit proves to be
insufficient in any respect (so long as such document on its face appears to
comply with the requirements of such Operational Letter of Credit), and whether
or not any other statement or any other document presented pursuant to such
Operational Letter of Credit proves to be forged or invalid or any statement
therein proves to be inaccurate or untrue in any respect whatsoever and (iii)
any noncompliance in any immaterial respect of the documents presented under
such Operational Letter of Credit with the terms thereof shall, in each case, be
deemed not to constitute willful misconduct or gross negligence of the Issuing
Bank. It is further understood and agreed that, notwithstanding the proviso to
clause (iv) of Section 2.17(h), the Borrower's obligation hereunder to reimburse
Operational Letter of Credit Disbursements will not be excused by the gross
negligence or willful misconduct of the Issuing Bank to the extent that such
Operational Letter of Credit Disbursement actually discharged a liability of, or
otherwise benefited, or was recovered by, the Borrower; PROVIDED, THAT, the
foregoing shall not be construed to excuse the Issuing Bank from liability to
the Borrower to the extent of any direct damages suffered by the Borrower that
are caused by the Issuing Bank's gross negligence or willful misconduct in
determining whether drafts and other documents presented under an Operational
Letter of Credit comply with the terms thereof.
(j) The Issuing Bank shall, promptly following its receipt thereof,
examine all documents purporting to represent a demand for payment under an
Operational Letter of Credit. The Issuing Bank shall as promptly as possible
give telephonic notification, confirmed by telex or telecopy, to the
Administrative Agent and the Borrower of such demand for payment and whether the
Issuing Bank has made or will make the Operational Letter of Credit Disbursement
thereunder; PROVIDED, THAT, the failure to give such notice shall not relieve
the Borrower of its obligation to reimburse Operational Letter of Credit
Disbursement in accordance with this Section 2.17. The Administrative Agent
shall promptly give each Revolving Lender notice thereof.
(k) The Borrower shall use the Operational Letters of Credit solely to
support various financial and other payment or performance obligations of the
Borrower Entities (excluding obligations of Twelvepole, until Ceredo has
achieved Commercial Operation) incurred in the ordinary course of business
including, without limitation, any expansion, repowering, maintenance, repairs
or capital expenditures.
(l) In the event that the Borrower is required pursuant to the terms
of this Agreement to provide cash collateral in respect of the Operational
Letter of Credit Exposure, the Borrower shall deposit in an account with the
Administrative Agent, for the benefit of each Lender having a Revolving Loan
Commitment, an amount in cash equal to the Operational Letter of Credit Exposure
(or such lesser amount as shall be required hereunder or thereunder). Such
deposit shall be held by the Administrative Agent as collateral for the payment
and performance of any outstanding Operational Letter of Credit Exposure. The
Administrative Agent shall have exclusive dominion and control, including the
exclusive right of withdrawal, over such account. Moneys in such account shall
be held and applied by the Administrative Agent in accordance with the Deposit
Account Agreement.
ARTICLE III
conditions precedent
Section 3.01 CONDITIONS PRECEDENT TO THE CLOSING DATE. The obligation
of the Lenders to make any Advances under this Agreement is subject to the
fulfillment on the Closing Date (in form, scope and substance satisfactory to
the Lenders) of the following conditions precedent:
(a) FINANCING DOCUMENTS. Each of the following Financing Documents
shall have been duly authorized, executed and delivered by each party thereto
and shall be in full force and effect and all associated notices and
acknowledgments shall have been made or waived:
(i) this Agreement;
(ii) the Acquisition Loan Notes;
(iii) the Revolving Loan Notes;
(iv) any DLC Letter of Credit required to be delivered under
the POLR Agreement or the POLR II Agreement on the Closing
Date pursuant to the terms thereof;
(v) the Security Agreement;
(vi) the Equity Contribution Agreement;
(vii) the Security Account Control Agreement;
(viii) the Deposit Account Agreement;
(ix) the Partnership Interest Pledge Agreements;
(x) the Mortgages;
(xi) the Financing Statements in respect of the Security
Agreement, the Partnership Interest Pledge Agreements,
the Stock Pledge Agreement and the Mortgages; and
(xii) the Stock Pledge Agreement.
(b) PROJECT CONTRACTS. Receipt of a copy of each of the following duly
executed and delivered Project Contracts certified by a Responsible Officer of
the Borrower. All conditions precedent contained in such Project Contracts shall
have been satisfied or waived (as determined or approved by the Arrangers) in
accordance with the terms thereto:
(i) the CPS Strategic Alliance Agreement;
(ii) the O&M Agreements;
(iii) the DLC Interconnection Agreements;
(iv) the FE Interconnection Agreements;
(v) the POLR Agreement;
(vi) the POLR II Agreement;
(vii) the DLC Must-Run Agreements;
(viii) the FE Must-Run Agreements;
(ix) the Acquired Fuel Supply Contracts;
(x) the DLC Consent;
(xi) the FE Consent;
(xii) the Operator Consent;
(xiii) the CPS Consent;
(xiv) the DLC Easement and Attachment Agreement;
(xv) the FE Easement and Attachment Agreements;
(xvi) the COSI Technical Support Agreement;
(xvii) the Harwick Ash Agreement;
(xviii) the Harwick Consent; and
(xix) the Agency Agreement.
(c) BORROWING NOTICE. The Administrative Agent shall have received a
Notice of Acquisition Borrowing in accordance with the terms of Section 2.03(a).
(d) CORPORATE PROCEEDINGS. Receipt of copies of (i) all partnership
actions taken by or on behalf of the Borrower authorizing the execution,
delivery and performance of this Agreement and each other Transaction Document
to which the Borrower is a party, certified by a Responsible Officer of the
Borrower, (ii) all corporate or limited liability company action taken by or on
behalf of each other Credit Party and, to the extent obtainable using reasonable
efforts, each Major Project Party authorizing the execution, delivery and
performance of each Transaction Document to which such Person is a party,
certified by a Responsible Officer of such Credit Party or, to the extent
obtainable using reasonable efforts, such Major Project Party, as the case may
be, and (iii) all other documents evidencing other necessary corporate, limited
liability company, partnership or other action of each Credit Party with respect
to the Financing Documents to which it is a party, certified by a Responsible
Officer of such Credit Party.
(e) INCUMBENCY; GOVERNING DOCUMENTS. Receipt of a certificate of a
Responsible Officer of the Borrower and each other Credit Party certifying (x)
the names and true signatures of the officers or authorized representatives of
such Credit Party authorized to sign the Financing Documents to which it is a
party and the other documents to be delivered thereunder and (y) a copy of the
Governing Documents of each Credit Party as in effect on the Closing Date.
(f) GOOD STANDING CERTIFICATES. Receipt of copies of certificates
dated as of a recent date from the Secretary of State or other appropriate
authority of such jurisdiction evidencing the good standing of the Borrower and
each other Credit Party in the jurisdiction of incorporation or its
organization, as the case may be, and in every jurisdiction where the character
of such Person's properties or the nature of its activities make such
qualifications necessary.
(g) LEGAL OPINIONS. Receipt of the following legal opinions: (i)
Thelen Reid & Priest LLP, special counsel to the Credit Parties; (ii) Kirkland &
Ellis, special counsel to the Credit Parties; (iii) Stroock & Stroock & Lavan
LLP, special counsel to the Credit Parties, (iv) Wolf, Block, Schorr and
Solis-Cohen, special Pennsylvania counsel to the Credit Parties, (v) Ryan,
Russell, Ogden & Seltzer, special Pennsylvania counsel to the Credit Parties,
and (vi) Benesch, Friedlander, Caplan & Aronoff, special Ohio counsel to the
Credit Parties.
(h) ACQUISITION. Receipt of a copy of the Acquisition Agreement, in
the form executed and delivered by the parties thereto as of September 24, 1999,
certified by a Responsible Officer of the Borrower and all conditions precedent
to the obligation of the Borrower thereunder shall have been satisfied (as
determined by the Lenders) or waived (as approved by the Lenders).
(i) PROJECTIONS. Receipt, on or prior to the Closing Date, of the
Projections mutually acceptable to the Borrower and the Arrangers.
(j) GOVERNMENTAL APPROVALS. Receipt of a certificate from a
Responsible Officer of the Borrower (i) attaching copies of those Closing Date
Governmental Approvals appearing on Part A of SCHEDULE 4.04 and stating that all
such Closing Date Governmental Approvals have been duly obtained and are in full
force and effect, not subject to any appeal or similar proceeding, except only
as to an appeal or similar proceeding that is specifically set forth on Part C
of Schedule 4.04, (ii) certifying that those Closing Date Governmental Approvals
appearing on Part B of SCHEDULE 4.04 have been duly obtained and are in full
force and effect, copies of which are expected to be received in the ordinary
course of business without undue expense or delay, and that are not subject to
any appeal or similar proceeding, except only as to an appeal or similar
proceeding that is specifically set forth on Part C of Schedule 4.04, and (iii)
certifying that the Borrower has no reason to believe that all Governmental
Approvals appearing on Part D of SCHEDULE 4.04 will not be obtained by the dates
by which they are required and no other Governmental Approvals are required for
the ownership or operation of the Portfolio Assets as contemplated by the
Transaction Documents (other than Governmental Approvals that may be required
for the operation of the Phillips facility or Ceredo, which in each case shall
not be necessary unless and until the Borrower or Twelvepole, as applicable,
elects to place such facility into operation).
(k) INDEPENDENT ENGINEER'S REPORT. Receipt of the Independent
Engineer's Report, addressing all aspects of the Portfolio Assets, including,
without limitation, the forecasted operating and capital costs of the Portfolio
Assets, the ability of the Portfolio Assets to operate as expected, forecasted
heat rates, overall assessment of the Portfolio Assets and forecasted
electricity generation revenues for the Borrower and environmental matters, in
form and substance reasonably satisfactory to the Arrangers.
(l) POWER MARKET CONSULTANT REPORT. Receipt of the Power Market
Consultant Report, in form and substance reasonably satisfactory to the
Arrangers.
(m) FUEL CONSULTANT REPORT. Receipt of the Fuel Consultant's Report,
as to fuel-related matters, in form and substance reasonably satisfactory to the
Arrangers.
(n) FUEL PLAN. Receipt of the Fuel Plan, in form and substance
reasonably satisfactory to the Arrangers.
(o) POWER MARKETING PLAN. Receipt of the Power Marketing Plan, in form
and substance reasonably satisfactory to the Arrangers.
(p) O&M PLAN. Receipt of the O&M Plan, in form and substance
reasonably satisfactory to the Arrangers.
(q) FEES AND EXPENSES. All fees and expenses due and payable by the
Borrower or any other Credit Party to any Secured Party pursuant to any
Financing Document on or prior to the Closing Date shall have been paid to the
extent invoiced to the Borrower at least one (1) Business Day prior to the
Closing Date.
(r) EQUITY CONTRIBUTION. The Sponsor shall have (i) made an
irrevocable and unconditional cash equity contribution to the account of the
Borrower in an amount equal to the Equity Contribution Amount, and such amount
shall have been deposited into the Equity Proceeds Account for application
therefrom pursuant to the terms of the Deposit Account Agreement, and (ii) taken
such action as is necessary to make the representation and warranty set forth in
Section 4.23 true and correct as of the Closing Date.
(s) NO LEGAL PROCEEDINGS. Except as set forth on SCHEDULE 4.05 hereto,
there shall be no (i) injunction, writ, preliminary restraining order or any
order of any nature issued by an arbitrator, court or other Governmental
Authority in connection with the transactions provided for herein or in the
other Transaction Documents, or (ii) litigation, investigation or proceedings
before any arbitrator, court or other Governmental Authority pending or, to the
Borrower's knowledge, threatened (A) against the Borrower, any Credit Party, any
Portfolio Asset or any other Major Project Party or any of their respective
properties, revenues or assets or (B) with respect to this Agreement or the
other Transaction Documents or any of the transactions contemplated hereby or
thereby. To the Borrower's knowledge, there is no reasonable basis for any of
the foregoing and a Responsible Officer of the Borrower shall have delivered a
certificate of a Responsible Officer of as to the matters set forth in this
Section 3.01(s).
(t) FINANCIAL STATEMENTS; FEDERAL TAX ID NUMBERS. Receipt of (i)
balance sheets and financial statements of each Credit Party, prepared in
accordance with GAAP and certified as to accuracy by a Responsible Officer of
each such Credit Party, (ii) the most recent balance sheets and financial
statements of COSI and its Subsidiaries, CPS and, to the extent reasonably
available to the Borrower, each other Major Project Party as at the end of their
respective fiscal years and the related statements of income, retained earnings
and cash flows of such Major Project Party, for such fiscal year, all in
reasonable detail and (iii) the Federal tax identification numbers and addresses
of each Credit Party delivering financial statements under Section 3.01(t)(i).
(u) ESTABLISHMENT OF ACCOUNTS. All Accounts and sub-accounts thereof
shall have been established pursuant to the Transaction Documents and the
Borrower shall have contemporaneously made, or caused to be made, the initial
deposits into (i) the Debt Service Reserve Account, in an amount not less than
$45,000,000 and (ii) the Replacement Capital Expenditure Pre-Funding Account in
an amount not less than $10,000,000.
(v) PERFECTION OF SECURITY INTERESTS. All filings, recordings and
other actions that are necessary or, in the reasonable opinion of the Lenders,
desirable in order to establish, protect and preserve the Administrative Agent's
(for the benefit of the Secured Parties) first priority lien on and, perfected
security interest in all right, title, estate and interest in and to the
Collateral covered by the Security Documents executed and delivered as of the
Closing Date, on the terms set forth therein, shall have been duly made or taken
or satisfactory arrangements to make such filings promptly following the Closing
Date shall be established. Upon making such filings, the Administrative Agent
(for the benefit of the Secured Parties) shall have, on the terms set forth in
such Security Documents, a first priority lien on and perfected security
interest in all right, title, estate and interest in and to the applicable
Collateral, in each case prior and superior to all other Liens except Permitted
Liens.
(w) REAL ESTATE MATTERS. Receipt of (i) one or more original lender's
policies of title insurance issued by Fidelity National Title Insurance Company
of New York and Chicago Title Insurance Company (the "TITLE COMPANIES"), as
co-insurers thereunder, or one or more other title companies acceptable to the
Arrangers with such endorsements and coverage as the Arrangers reasonably
request insuring the liens created by the Mortgages in a manner reasonably
acceptable to the Arrangers, (ii) one or more original owner's policies of title
insurance issued by the Title Companies or one or more other title companies
reasonably acceptable to the Arrangers with such endorsements and coverage as is
reasonably acceptable to the Arrangers covering the real property interests
encumbered by the Mortgages, and (iii) surveys conducted by licensed surveyors
reasonably satisfactory to the Arrangers containing certifications satisfactory,
and showing no state of facts unsatisfactory, to the Arrangers, in respect of
the real property interests encumbered by the Mortgages.
(x) INSURANCE. (i) Receipt, from the Insurance Consultant, of the
Insurance Consultants Report in respect of the insurance coverages for the
Portfolio Assets, in form and substance reasonably satisfactory to the
Arrangers, (ii) all insurance policies required to be maintained by the Borrower
pursuant to Section 5.06 shall have been obtained, shall be in full force and
effect on the Closing Date and not subject to cancellation without prior notice,
all such insurance policies shall comply in all material respects with the
requirements of SCHEDULE 5.06, and the Arrangers shall have received a
certificate from the Insurance Consultant as to the matters set forth in this
clause (ii), (iii) the Borrower shall deliver or cause to be delivered originals
or certified copies of all policies evidencing such insurance described in
clause (ii) of this Section 3.01(x) (or a binder, commitment or certificates
signed by the insurer or a broker authorized to bind the insurer) in form and
substance satisfactory to the Arrangers, and (iv) the Insurance Consultant shall
have approved all insurance policies, applications, disclosures and other
information provided to or obtained from, as the case may be, all insurers
providing the insurances identified in SCHEDULE 5.06 and (v) all premiums then
due and payable on the insurance policies required pursuant to Section 5.06
shall have been paid.
(y) INTELLECTUAL PROPERTY. The Borrower shall provide satisfactory
evidence to the Lenders that it has obtained, on or prior to the Closing Date,
all Intellectual Property rights contemplated by Section 4.19.
(z) OPERATING BUDGET. The Arrangers and the Independent Engineer shall
have received an Operating Budget conforming to the requirements set forth in
the definition thereof and otherwise reasonably acceptable to them.
(aa) PROCESS AGENT. Receipt of evidence that each Credit Party has
irrevocably appointed as its agent for service of process National Registered
Agents, Inc. (or another Person satisfactory to the Arrangers), and that each
such agent has accepted the appointment and has agreed to forward forthwith to
such Credit Party all legal process in New York, New York addressed to such
Credit Party as applicable, received by such agent.
(bb) FEE SIDE LETTERS. Each Arranger and each Agent shall have
received a copy of each such Person's respective Fee Side Letter, in form and
substance satisfactory to such Person.
(cc) OFFICER'S CERTIFICATE. Receipt of a certificate from a
Responsible Officer of the Borrower certifying that (i) all representations and
warranties made by the Borrower in Article IV hereof are true in all respects,
(ii) the Borrower has duly performed and complied with each of the obligations
required under the Project Contracts to which it is a party, (iii) no Default or
Event of Default has occurred and is continuing, (iv) each Project Contract to
which the Borrower is a party remains in full force and effect, (v) to such
Responsible Officer's knowledge, no event has occurred which could reasonably be
expected to cause a Material Adverse Effect, both before and after giving effect
to the transactions contemplated to occur on the Closing Date, and (vi) all
utility services necessary for the operation and maintenance of the Portfolio
Assets in accordance with Prudent Industry Practice are available and have been
obtained (other than utility services necessary for the operation and
maintenance of the Phillips facility, which shall not be necessary unless and
until the Borrower elects to place such facility into operation).
(dd) LIEN SEARCHES. Receipt of results of a recent search by a Person
satisfactory to the Lenders of the Uniform Commercial Code, judgment and tax
lien filings which may have been filed with respect to personal property of the
Credit Parties, and the results of such search shall be reasonably satisfactory
to the Lenders.
(ee) ALLEGHENY LITIGATION. Either (i) receipt of evidence of a final
resolution to the litigation between Allegheny Energy, Inc. and DQE, Inc. filed
in the United States District Court for the Western District of Pennsylvania
(Civil Action No. 98-1639), and any related actions, or (ii) the Lenders have
otherwise become reasonably satisfied with the risk of the sale of the Portfolio
Assets to the Borrower being enjoined, rescinded or otherwise materially
adversely affected as a result of such litigation.
(ff) OTHER DOCUMENTS; INFORMATION. The Arrangers shall have received
(with a copy for each of the other Lenders) all such other statements,
certificates, documents and other information with respect to the matters
contemplated by this Agreement and the other Financing Documents and Transaction
Documents as the Arrangers or any Lender may reasonably request.
Section 3.02 CONDITIONS PRECEDENT TO REVOLVING LOANS. The obligation
of any Lender to make its respective Revolving Advance and the obligation of the
Issuing Bank to issue the DLC Letter of Credit or any Operational Letter of
Credit under this Agreement is subject to the fulfillment on the applicable
Revolving Loan Funding Date in a manner satisfactory to each such Lender of the
following conditions precedent:
(a) NOTICE OF REVOLVING LOAN. The Administrative Agent shall have
received (with a copy for each of the other Revolving Lenders) a Notice of
Revolving Borrowing in accordance with the terms of Section 2.03(b).
(b) REPRESENTATIONS AND WARRANTIES. The representations and warranties
made by the Credit Parties under this Agreement and in each other Financing
Document to which each such Person is a party shall be true and correct in all
material respects (both before and after giving effect to the proposed Revolving
Loan) on and as of the Revolving Loan Funding Date as though made on and as of
the Revolving Loan Funding Date, except to the extent that such representations
and warranties relate to a specific earlier date, in which case such
representations and warranties shall have been true and correct in all material
respects on and as of such earlier date.
(c) EVENT OF DEFAULT. No Default or Event of Default shall have
occurred and be continuing under any Transaction Document (both before and after
giving effect to the proposed Revolving Loan) on and as of such Revolving Loan
Funding Date.
Section 3.03 CONDITIONS PRECEDENT TO THE CEREDO EFFECTIVE DATE. The
occurrence of the "Ceredo Effective Date," and the obligation of the
Administrative Agent from time to time thereafter to release funds then
remaining in the Equity Proceeds Account, to or on the direction of the
Borrower, in accordance with the Deposit Account Agreement, is subject to the
fulfillment (in form, scope and substance satisfactory to the Arrangers) of the
following conditions precedent:
(a) CLOSING DATE CONDITIONS. All of the conditions precedent set forth
in this Section 3.03 shall have been satisfied on or before December 31, 2000.
(b) ACQUISITION CERTIFICATE. The Administrative Agent shall have
received an Officer's Certificate of the Sponsor certifying the acquisition by
the Sponsor of 100% of the equity interests in Twelvepole, free and clear of any
lien, claim or encumbrance, pursuant to the Twelvepole Acquisition Agreement.
(c) FINANCING DOCUMENTS. The Twelvepole Intercompany Working Capital
Note shall be executed by Twelvepole, accompanied by undated assignments
executed in blank, and delivered to the Administrative Agent. In addition, each
of the following Financing Documents shall have been duly authorized, executed
and delivered and shall be in full force and effect and all associated notices
and acknowledgments shall have been made or waived:
(i) the Borrower Twelvepole LLC Interest Pledge Agreement;
(ii) the Twelvepole Intercompany Agreement;
(iii) the Twelvepole Guarantee; and
(iv) the Financing Statements in respect of the Borrower
Twelvepole LLC Interest Pledge Agreement.
(d) PROJECT CONTRACTS. Receipt of a certificate from a Responsible
Officer of the Borrower certifying that (i) the Ceredo Project Contracts and the
Governing Documents of Twelvepole delivered to the Administrative Agent on the
Ceredo Closing Date are true, correct and complete copies of the Ceredo Project
Contracts in effect as of the Ceredo Effective Date (except as the Ceredo EPC
Contract has been amended as provided in EXHIBIT X hereto, with any changes to
such EXHIBIT X as shall be approved by the Arrangers, or Section 6.05) and all
of the Governing Documents of Twelvepole in existence as of the Ceredo Effective
Date and (ii) as of the Ceredo Effective Date, none of such Ceredo Project
Contracts or Governing Documents has been amended, modified or terminated except
in accordance herewith and as disclosed in writing to the Administrative Agent,
the representations and warranties of Twelvepole and, to the Borrower's
knowledge, each Major Project Party, in each such Ceredo Project Contract to
which each such Person is a party are true and correct in all material respects
and, to the Borrower's current actual knowledge, no other party to a Ceredo
Project Contract is in default of such party's material obligations thereunder.
(e) CORPORATE PROCEEDINGS. Receipt of copies of (i) all corporate,
limited liability company, partnership or other actions taken by or on behalf of
Twelvepole, authorizing the execution, delivery and performance of each
Transaction Document to which it is a party, certified by a Responsible Officer
of Twelvepole, (ii) all corporate, limited liability company, or partnership or
other action taken by or on behalf of the Borrower and the General Partner
authorizing the execution, delivery and performance of each Transaction Document
executed and delivered pursuant to this Section 3.03 to which such Person is a
party, certified by a Responsible Officer of each such Person, as the case may
be (including the amendment of the business purpose clauses of the Governing
Documents of the Borrower and the General Partner to the extent necessary to
reflect the Borrower's acquisition and ownership of the membership interests of
Twelvepole and the development, construction, ownership and operation of Ceredo
by Twelvepole as contemplated under Section 6.04 hereof), (iii) the Twelvepole
Operating Agreement, amended to reflect the 100% ownership interest of Borrower
and to include single-purpose entity covenants as provided on Exhibit V hereto,
certified by a Responsible Officer of Twelvepole, and (iv) all other documents
evidencing other necessary corporate, limited liability company, partnership or
other action of any other Credit Party with respect to the Transaction Documents
delivered pursuant to this Section 3.03, certified by a Responsible Officer of
such Person.
(f) INCUMBENCY; RESPONSIBLE OFFICER CERTIFICATES. Receipt of a
certificate of a Responsible Officer of Twelvepole certifying the names and true
signatures of the officers or authorized representatives of Twelvepole
authorized to sign the Financing Documents to which it is a party and the other
documents to be delivered thereunder.
(g) GOOD STANDING CERTIFICATES. Receipt of copies of certificates
dated as of a recent date from the Secretary of State or other appropriate
authority of such jurisdiction evidencing the good standing of Twelvepole in the
jurisdiction of its incorporation or organization, as the case may be, and in
every jurisdiction where the character of such Person's properties or the nature
of its activities make such qualifications necessary.
(h) GENERATOR PURCHASE ORDER. The Administrative Agent shall have
received an Officer's Certificate of the Borrower certifying that all right,
title and interest of Columbia Capacity in, to and under the Ceredo Generator
Purchase Order has been duly assigned to Twelvepole, free and clear of liens,
claims or encumbrances, or that the Borrower has made other arrangements with
respect thereto reasonably satisfactory to the Arrangers.
(i) EQUITY CONTRIBUTION. The Administrative Agent shall have received
an Officer's Certificate of the Sponsor certifying that the Sponsor has made an
irrevocable and unconditional contribution to the Borrower of 100% of the equity
interests in Twelvepole.
(j) LEGAL OPINIONS. The Arrangers shall have received the following
legal opinions: (i) Thelen Reid & Priest, special counsel to the Borrower and
Twelvepole, and (ii) Stroock & Stroock & Lavan LLP, special counsel to the
Borrower and Twelvepole, in each case in form and substance reasonably
acceptable to the Arrangers, it being acknowledged that legal opinions
substantially in the form delivered pursuant to Section 3.01(g) hereof (with
such additions and other changes as are acceptable to the Arrangers and
necessary to reflect the structure of the transactions contemplated by this
Section 3.03) shall be deemed to be acceptable.
(k) GOVERNMENTAL APPROVALS. Receipt of a certificate from a
Responsible Officer of the Borrower certifying that the Borrower has no reason
to believe that all Governmental Approval required for the ownership or
operation of Ceredo will not be obtained by the dates by which they are
required.
(l) PERFECTION OF SECURITY INTERESTS. All filings, recordings and
other actions that are necessary or desirable in the reasonable opinion of the
Lenders in order to establish, protect and preserve the Administrative Agent's
(for the benefit of the Secured Parties) first priority lien on and, perfected
security interest in all right, title, estate and interest in and to the
Collateral covered by the Borrower Twelvepole LLC Interest Pledge Agreement, on
the terms set forth therein, shall have been duly made or taken or satisfactory
arrangements to make such filings promptly following the Ceredo Effective Date
shall be established. Upon making such filings, the Administrative Agent (for
the benefit of the Secured Parties) shall have, on the terms set forth in such
Security Documents, a first priority lien on and perfected security interest in
all right, title, estate and interest in and to the applicable Collateral, in
each case prior and superior to all other Liens except Permitted Liens.
(m) REAL ESTATE MATTERS. Receipt of a copy of one or more owner's
policies of title insurance issued by First American Title Insurance Company or
one or more other title companies acceptable to the Arrangers, insuring title to
the real property interests to be encumbered by the Twelvepole Mortgage,
reasonably acceptable to the Arrangers.
(n) OFFICER'S CERTIFICATE. Receipt of a certificate from a Responsible
Officer of the Borrower certifying that (i) all representations and warranties
made by the Borrower in Article IV hereof (except in respect of Twelvepole,
Ceredo or the other properties or assets (tangible or intangible, real or
personal) of Twelvepole) are true in all respects as if made on and as of the
Ceredo Effective Date, except to the extent that such representations and
warranties relate to a specific earlier date, in which case such representations
and warranties shall have been true and correct on and as of such earlier date,
(ii) nothing has come to the attention of the Borrower that would cause the
Borrower to believe that the representations and warranties in Article IV, as
they relate to Ceredo, will not be true in all respects as of February 15, 2001
or that Twelvepole will not be able to achieve Commercial Operation with respect
to Ceredo on or before July 1, 2001, (iii) no Default or Event of Default has
occurred and is continuing, and (iv) no Closing Failure has occurred as of such
date.
(o) INSURANCE. (i) Receipt, from the Insurance Consultant, of a
supplemental Insurance Consultant's Report in respect of the insurance coverages
for Ceredo, in form and substance reasonably satisfactory to the Arrangers, (ii)
all insurance policies required to be maintained with respect to Twelvepole and
Ceredo pursuant to Section 5.06 shall have been obtained, shall be in full force
and effect on the Ceredo Effective Date and not subject to cancellation without
prior notice, all such insurance policies shall comply in all material respects
with the requirements of Schedule 5.06, and the Arrangers shall have received a
certificate from the Insurance Consultant as to the matters set forth in this
clause (ii), (iii) the Borrower shall deliver or cause to be delivered originals
or certified copies of all policies evidencing such insurance described in
clause (ii) of this Section 3.03(o) (or a binder, commitment or certificates
signed by the insurer or a broker authorized to bind the insurer) in form and
substance satisfactory to the Arrangers, (iv) the Insurance Consultant shall
have approved all insurance policies, applications, disclosures and other
information provided to or obtained from, as the case may be, all insurers
providing the insurance identified in Schedule 5.06 and (v) all premiums then
due and payable on the insurance policies required pursuant to Section 5.06
shall have been paid.
(p) PROCESS AGENT. Receipt of evidence that Twelvepole has irrevocably
appointed as its agent for service of process National Registered Agents, Inc.
(or another Person satisfactory to the Arrangers), and that each such agent has
accepted the appointment and has agreed to forward forthwith to Twelvepole all
legal process in New York, New York addressed to Twelvepole received by such
agent.
(q) OTHER DOCUMENTS; INFORMATION. The Arrangers shall have received
(with a copy for each of the other Lenders) all such other statements,
certificates, documents and other information with respect to the matters
contemplated by this Agreement and the other Financing Documents and Transaction
Documents as the Arrangers or any Lender may reasonably request.
ARTICLE IV
REPRESENTATIONS AND WARRANTIES
In order to induce the Secured Parties to enter into this Agreement
and the other agreements contemplated hereby, the Borrower makes the following
representations and warranties to the Secured Parties; PROVIDED, however, that
(i) the Borrower shall not be deemed to make such representations as they relate
to Twelvepole, Ceredo or the other properties and assets (tangible or
intangible, real or personal) of Twelvepole until the Borrower has delivered to
the Administrative Agent the certificate with respect thereto described in
Section 5.28(vii) and (ii) with respect to all such representations as they
relate to Twelvepole, Ceredo or the other properties and assets (tangible or
intangible, real or personal) of Twelvepole, all references in this Article IV
to the "Closing Date" shall be deemed to be references to the date of the
certificate with respect thereto described in Section 5.28(vii).
Section 4.01 EXISTENCE; DUE QUALIFICATION; COMPLIANCE WITH LAW. Each
Borrower Entity (a) is duly formed, validly existing and in good standing under
the laws of the respective jurisdiction of its formation, (b) has all requisite
power and authority to own its property and assets, to borrow money and to
transact the business in which it is presently engaged and in which it proposes
to be engaged, (c) has duly qualified and is authorized to do business and is in
good standing in every jurisdiction where the character of its properties or the
nature of its activities makes such qualification necessary and (d) is in full
compliance with its Governing Documents, all Contractual Obligations, all
applicable Requirements of Law and all of its Governmental Approvals, except to
the extent that the failure to comply therewith could not reasonably be expected
to have a Material Adverse Effect.
Section 4.02 POWER; AUTHORITY; NO VIOLATION; BINDING EFFECT. (a) The
execution, delivery and performance by the Borrower Entities of the Transaction
Documents to which each is a party and the consummation of the transactions
contemplated thereby (i) are within their respective powers, (ii) have been duly
authorized by all necessary corporate or partnership action, (iii) do not and
will not contravene (A) their respective Governing Documents or (B) any material
Requirement of Law, any material Contractual Obligation or any material
Governmental Approval binding on or affecting any of them and (iv) do not and
will not conflict with or be inconsistent with or result in any breach of any of
the terms, covenants, conditions or provisions of, or constitute a default
under, or result in the creation or imposition of (or the obligation to create
or impose) any Lien (except Permitted Liens) upon any of their respective
properties or assets pursuant to, the terms of any material Contractual
Obligation binding on or affecting any of them.
(b) Each Borrower Entity has duly executed and delivered each
Transaction Document to which it is a party. Each Transaction Document
constitutes the legal, valid and binding obligation of each Borrower Entity (to
the extent it is a party thereto), enforceable against such Borrower Entity in
accordance with its terms, except as enforcement thereof may be subject to (i)
the effect of any applicable bankruptcy, insolvency, reorganization, moratorium
or similar laws affecting creditors' rights generally and (ii) general
principles of equity.
Section 4.03 OWNERSHIP OF PROPERTY. Each Borrower Entity has good
title to, or valid leasehold, easement or right-of-way interests in, the
material property, assets or revenues which it purports to own, lease or hold
any such interest in, free and clear of all Liens (except Permitted Liens),
including possession of all required real estate interests and licenses,
Intellectual Property and other proprietary rights.
Section 4.04 GOVERNMENTAL APPROVALS. (i) Except as otherwise set forth
on SCHEDULE 4.04 attached hereto, no Governmental Approval or approval of any
other Person (except such as have been duly obtained, made or given, and are in
full force and effect or the failure to obtain which is not material to the
ongoing operation of any Portfolio Asset) is required to authorize, or is
required in connection with (a) the execution, delivery or performance of any
Transaction Document by any Borrower Entity or the consummation of any of the
transactions contemplated thereby (including, without limitation, the purchase
of the Portfolio Assets and the granting of Liens pursuant to the Security
Documents), (b) the ownership, maintenance or operation of the Portfolio Assets
by the relevant Borrower Entity (other than Governmental Approvals that may be
required for the operation of Phillips or Ceredo, which shall not be necessary
unless and until the Borrower or Twelvepole, as applicable, elects to place such
Portfolio Asset into operation) or (c) the legality, validity, binding effect or
enforceability of any Transaction Document. Except as otherwise set forth on
Part C of SCHEDULE 4.04, all applicable waiting periods (including appeal
periods) relating to any such Governmental Approval or other approval which are
required and have been obtained have expired without any adverse action taken
with respect thereto.
(ii) On the Closing Date, each Revolving Loan Funding Date and
the date of issuance of any Letter of Credit, each of the Governmental Approvals
and other consents and approvals listed on Parts A and B of SCHEDULE 4.04, is in
full force and effect, is not subject to any appeal or similar proceeding,
except as such appeal or similar proceeding is expressly described on Part C of
SCHEDULE 4.04. The Borrower has no reason to believe, after reasonable inquiry,
that as of the Closing Date, any of the Governmental Approvals and other
consents and approvals listed on Part D of SCHEDULE 4.04 cannot or will not be
obtained or made in the normal course of business as and when required and
without material expense or delay. No Borrower Entity is in violation of any
condition in any material Governmental Approval.
Section 4.05 LEGAL PROCEEDINGS. Except as set forth on SCHEDULE 4.05
attached hereto, there is no (a) injunction, writ, preliminary restraining order
or order of any nature issued by an arbitrator, court or other Governmental
Authority against any Borrower Entity, or, to the Borrower's knowledge, against
any other Major Project Party, in connection with the transactions provided for
herein or in the other Transaction Documents, or (b) action, suit, arbitration,
litigation, investigation or proceeding of or before any arbitrator or
Governmental Authority pending against (i) any Borrower Entity or, to the
Borrower's knowledge, threatened against any Borrower Entity nor, to the
Borrower's knowledge, is there any reasonable basis for any such action, suit
arbitration, litigation, investigation or proceeding, or, (ii) to the Borrower's
knowledge, pending or threatened against any other Major Project Party, which,
solely with respect to this clause (ii), could reasonably be expected to result
in a material adverse affect on the financial condition of such Major Project
Party or such Major Project Parties' ability to fulfill its obligations under
the Project Contract to which it is a party.
Section 4.06 FINANCIAL STATEMENTS. Each financial statement of the
Credit Parties, and to the Borrower's knowledge, the Major Project Parties,
delivered by the Borrower to the Arrangers, Lenders or the Administrative Agent,
on the Closing Date was prepared in accordance with GAAP and fairly presents the
financial condition of such party as of the date of such financial statement.
Each financial statement of the Credit Parties, delivered from time to time by
the Borrower as required hereunder, was prepared in accordance with GAAP and
fairly presents the financial condition of such party as of the date of such
financial statement.
Section 4.07 INDEBTEDNESS. On the Closing Date, the Ceredo Closing
Date, the Ceredo Effective Date and each Revolving Loan Funding Date, the
Borrower has no outstanding Indebtedness other than Permitted Indebtedness.
Section 4.08 NO DEFAULT. No Default or Event of Default has occurred
and is continuing.
Section 4.09 TAXES. Each Borrower Entity has filed all tax returns
required to be filed by it and has paid all taxes and assessments payable by it
which have become due, other than those not yet delinquent and except for those
being contested in good faith and by appropriate proceedings and for which
Acceptable Reserves have been established. No tax Liens have been filed and no
claims or assessments are currently being asserted or, to the Borrower's
knowledge, are reasonably expected to be asserted with respect to any such taxes
or other charges.
Section 4.10 USE OF PROCEEDS. All proceeds of the Loans will be used
only for the purposes specified in Sections 2.01(d) and 2.02(d), as applicable.
No part of the proceeds of any Loan and no proceeds of any Letter of Credit will
be used by the Borrower to purchase or carry any Margin Stock or to extend
credit to any other Person for the purpose of purchasing or carrying any Margin
Stock.
Section 4.11 COMPLIANCE WITH ERISA. Each Borrower Entity, the Operator
and each ERISA Affiliate has fulfilled its obligations under the minimum funding
standards of ERISA and the Code with respect to each Benefit Arrangement and
Plan and is in compliance in all material respects with the presently applicable
provisions of ERISA and the Code with respect to each Benefit Arrangement and
Plan. None of the Borrower Entities, the Operator or any ERISA Affiliate has (a)
sought a waiver of the minimum funding standard under Section 412 of the Code in
respect of any Plan, (b) failed to make any contribution or payment to any Plan
or Multiemployer Plan or in respect of any Benefit Arrangement, or made any
amendment to any Plan or Benefit Arrangement, which in either case would trigger
the provisions of Section 412(n) or 401(a)(29) of the Code (or any corresponding
provisions of ERISA), (c) incurred any liability under Title IV of ERISA other
than a liability to the PBGC for premiums under Section 4007 of ERISA, (d)
engaged in any transaction described in Sections 4069 or 4204 of ERISA, or (e)
engaged in any Prohibited Transaction. No condition has occurred or exists with
respect to each Plan which by the passage of time would be expected to result in
an accumulated funding deficiency (within the meaning of Section 412 of the
Code).
Section 4.12 MATERIAL LIABILITIES. No Borrower Entity has any material
liabilities (actual or contingent) other than those (a) existing on the Closing
Date as set forth in SCHEDULE 4.12 hereto, as set forth in its most recent
financial statements or in the Operating Budget, (b) arising out of, or
expressly permitted by, this Agreement or the other Transaction Documents to
which it is, or is to become, a party or (c) liabilities incurred, existing or
assumed after the Closing Date pursuant to written agreements, contracts,
commitments and/or arrangements of any Borrower Entity, entered into in the
ordinary course of business permitted pursuant to the Financing Documents and
which individually or in the aggregate would not reasonably likely to result in
a material adverse effect on such Borrower Entity's financial condition or its
ability to fulfill its obligations under the Transaction Documents to which it
is a party.
Section 4.13 REGULATION OF PARTIES. (a) Each of the Borrower Entities
and Operator is an "exempt wholesale generator" under Section 32 of PUHCA. So
long as the Borrower Entities and Operator are owning and operating the
Portfolio Assets and are "exempt wholesale generators" under Section 32 of
PUHCA, none of the Borrower Entities nor any Credit Party nor Operator is, and
none will be, solely as a result of its participation in the transactions
contemplated hereby or by any other Transaction Document, or as a result of the
ownership, use or operation of the Portfolio Assets, subject to regulation by
the Securities and Exchange Commission as a "public-utility company," or an
"electric utility company," or a "holding company" or a "subsidiary" or
"affiliate" of any of the foregoing under PUHCA. So long as the owner and each
operator of the Portfolio Assets is an "exempt wholesale generator" under
Section 32 of PUHCA, none of the Lenders will, solely as a result of its or
their ownership or operation of the Portfolio Assets upon the exercise of
remedies under the Security Documents, be subject to regulation by the
Securities and Exchange Commission as a "public-utility company," an "electric
utility company," a "holding company," or a subsidiary or affiliate of any of
the foregoing under PUHCA.
(b) None of the Credit Parties is an "investment company" or a company
"controlled" by an "investment company," within the meaning of the Investment
Company Act of 1940, as amended.
Section 4.14 SECURITY DOCUMENTS. The Security Documents, together with
all necessary recordings thereof and filings with respect thereto, are effective
to create as security for the Loans, valid and enforceable Liens in and on all
of the Collateral described in each such Security Document in favor of the
Administrative Agent (for the benefit of the Secured Parties), and upon making
the filings referenced in SCHEDULE 4.14 hereof in the applicable filing or
recording office in accordance with applicable Requirements of Law, all
necessary and appropriate recordings and filings will have been made, all other
necessary and appropriate action will have been taken so that each such Security
Document creates a perfected Lien (other than with respect to vehicles or boats)
on and security interest in the Collateral covered thereby and appropriate
consents to the action, perfection and enforcement of such Liens have been
obtained from each of the Project Parties superior to and prior to the rights of
all other Persons, subject only to Permitted Liens. All taxes, fees and other
charges payable in connection therewith will have either been paid in full by
the Borrower or arrangements for the payment of such amounts satisfactory to the
Administrative Agent shall have been made.
Section 4.15 ACCURACY AND COMPLETENESS OF INFORMATION. (a) All factual
written information heretofore or contemporaneously created and furnished by or
on behalf of any Credit Party to the Arrangers, the Administrative Agent or any
Lender, for purposes of, or in connection with, this Agreement, any other
Transaction Document or any transaction contemplated hereby or thereby is, and
all such other factual information hereafter furnished by or on behalf of any
Credit Party to the Arrangers, the Administrative Agent or any Lender will be,
true and accurate in all material respects on the date as of which such
information is given, dated or certified and not incomplete by omitting to state
any material fact necessary to make such information not materially misleading
at such time, in each case taken as a whole together with all other information
theretofore or contemporaneously supplied; provided, that, no representation or
warranty is made with regard to (a) any projections or other forward-looking
statements provided by the Borrower, including the Projections (except as set
forth in Section 4.24 below) and (b) general market information.
(b) The Borrower has made a reasonable inquiry in respect of factual
written information heretofore or contemporaneously created and furnished by or
on behalf of any Person (other than any Credit Party) to the Arrangers, the
Administrative Agent or any Lender, for purposes of, or in connection with, this
Agreement, any other Transaction Document or any transaction contemplated hereby
or thereby. To the knowledge of the Borrower based on such inquiry, all such
factual information is true and accurate in all material respects on the date as
of which such information is given, dated or certified and is not incomplete by
omitting to state any material fact necessary to make such information not
materially misleading at such time, in each case taken as a whole together with
all other information theretofore or contemporaneously supplied.
(c) There is no fact known to any Credit Party which has, or could
reasonably be expected to have, a Material Adverse Effect which fact has not
been set forth herein, in the financial statements of any Credit Party, or any
certificate or other written statement made or furnished by any Credit Party to
the Arrangers or the Administrative Agent.
Section 4.16 PROPERTY RIGHTS, UTILITIES, ETC. All easements, leasehold
and other property interests, and all utility and other services, means of
transportation, facilities, other materials and other rights that are necessary
for the acquisition, operation and maintenance of the Portfolio Assets (other
than those which may be required for the operation of Phillips or Ceredo which
shall not be necessary unless and until the Borrower or Twelvepole, as
applicable, elects to place such Portfolio Asset into operation) in accordance
with all material Requirements of Law and the then existing Project Contracts
(including, without limitation, gas, electrical, water and sewage services and
facilities) have been procured and are available to the Borrower Entities and
the Portfolio Assets pursuant to the Project Contracts or are otherwise
commercially available to the Borrower Entities and the Portfolio Assets and, to
the extent appropriate, arrangements have been made by, or on behalf of (and
with the approval of), each Borrower Entity on commercially reasonable terms for
such easements, interests, services, means of transportation, facilities,
materials and rights in each case, except where the failure to procure or have
available any of the foregoing could not reasonably be expected to have a
material adverse effect on the operation of any Portfolio Asset.
Section 4.17 PROJECT CONTRACTS. The Borrower has delivered to the
Lenders prior to the date hereof, true, correct and complete copies of the
Project Contracts in effect as of the date hereof and all of the Governing
Documents of each Credit Party in existence as of the date hereof. As of the
date hereof, none of such Project Contracts or Governing Documents has been
amended, modified or terminated except in accordance herewith and as disclosed
in writing to the Administrative Agent, the representations and warranties of
each Borrower Entity and, to the Borrower's knowledge each Major Project Party,
in each such Project Contract to which each such Person is a party are true and
correct in all material respects and, to the Borrower's knowledge, no other
party to a Project Contract is in default of such party's material obligations
thereunder.
Section 4.18 PRINCIPAL PLACE OF BUSINESS. The principal place of
business of the Borrower and the office where the Borrower maintains its records
relating to the transactions contemplated by the Transaction Documents is
located at 2000 Cliff Mine Road, Suite 2000, Pittsburgh, PA 15275.
Section 4.19 PATENTS; LICENSES; FRANCHISES AND FORMULAS. (a) Each
Borrower Entity owns, has a license to use or otherwise has the right to use,
free and clear of any pending or, to the knowledge of the Borrower, threatened
Liens (other than Permitted Liens), all the patents, patent applications,
trademarks, permits, service marks, names, trade secrets, proprietary
information and knowledge, technology, computer programs, databases, copyrights,
licenses, franchises and formulas, or rights with respect thereto required to
operate and maintain the Portfolio Assets (other than Phillips or Ceredo, unless
and until the Borrower or Twelvepole, as applicable, elects to place such
Portfolio Asset into operation) as presently operated and maintained
(collectively, "INTELLECTUAL PROPERTY"), and to conduct its business as
presently conducted and as presently proposed to be conducted, in each case,
except where the failure to own or possess any such Intellectual Property could
not reasonably be expected to result in a Material Adverse Effect, and the
activities and transactions contemplated by the Transaction Documents, without
any conflict with the rights of others.
(b) Except as set forth on SCHEDULE 4.19 attached hereto, (i) each
Borrower Entity has obtained and holds in full force and effect, all franchises,
licenses, permits, certificates, authorizations, qualifications, easements,
rights of way and other rights and approvals which are necessary for the
operation of the Portfolio Assets as presently conducted and as presently
proposed to be conducted and the activities and transactions contemplated in the
Transaction Documents, and (ii) no Borrower Entity is in violation of the terms
of any such franchise, license, permit, certificate, authorization, easement,
right of way, qualification, right or approval, in any such case with respect to
clause (i) or (ii) above, which could reasonably be expected to have a Material
Adverse Effect.
Section 4.20 ENVIRONMENTAL MATTERS. Except as described in SCHEDULE
4.20:
(a) There are no facts, circumstances, conditions or occurrences
regarding the Portfolio Assets that could reasonably be likely to (i) form the
basis of any Environmental Claim arising with respect to the Portfolio Assets,
against the Portfolio Assets or any Borrower Entity, which individually or in
the aggregate could reasonably be expected to have a Material Adverse Effect,
(ii) cause any Portfolio Asset to be subject to any material restrictions on
ownership, occupancy, or use under any Environmental Law or (iii) require the
filing or recording of any notice, registration, permit or disclosure documents
with respect to any material violation of any Environmental Law.
(b) There are no past, pending or, to the Borrower's knowledge,
threatened Environmental Claims arising with respect to the ownership, operation
and maintenance of the Portfolio Assets, which individually or in the aggregate
could reasonably be likely to have a Material Adverse Effect.
(c) Hazardous Materials have not at any time been used or Released by
any Borrower Entity or, to the Borrower's knowledge, by any other Person, at,
on, under or from the Portfolio Assets other than in compliance at all times
with all applicable Environmental Laws, except where such use or Release could
not reasonably be expected to have a Material Adverse Effect. As of the Closing
Date, no Hazardous Material generated by any Borrower Entity has been recycled,
treated, stored, disposed of or Released by any Borrower Entity at any location
other than those listed in SCHEDULE 4.20.
(d) (i) there are not now and, to the Borrower's knowledge after
reasonable inquiry, never have been any underground storage tanks located at the
sites of any of the Portfolio Assets, (ii) there is no asbestos contained in,
forming part of, or contaminating any part of the Portfolio Assets, and (iii) no
polychlorinated biphenyls ("PCBS") are used, stored, located at or contaminate
any part of the Portfolio Assets, in any such case referenced in any of clauses
(i), (ii), or (iii) which individually or in the aggregate could reasonably be
likely to have a Material Adverse Effect.
(e) All written environmental investigations, studies, audits, tests,
reviews or other analyses conducted by, or that are in the possession of or
which have been delivered to, any Credit Party in relation to facts,
circumstances or conditions at or affecting the Portfolio Assets or any site or
facility now or previously owned, operated or leased by any Borrower Entity have
been made available to the Lenders.
(f) No Borrower Entity has transported or contractually permitted for
the transportation of any Hazardous Material to any location that is listed on
the National Priorities List ("NPL") under the Comprehensive Environmental
Response, Compensation and Liability Act of 1980, as amended ("CERCLA"), listed
for possible inclusion on the NPL by the Environmental Protection Agency in the
Comprehensive Environmental Response and Liability Information System, as
provided for by 40 C.F.R. ss. 300.5 ("CERCLIS"), or on any similar state or
local list or that is the subject of Federal, state or local enforcement actions
or other investigations that could reasonably be expected to result in any
material Environmental Claims against any Borrower Entity.
(g) No written notification of a Release of a Hazardous Material has
been filed by or on behalf of any Borrower Entity and neither the Portfolio
Assets nor any site or facility now or previously owned, operated or leased by
any Borrower Entity is listed or, to the Borrower's knowledge, proposed for
listing on the NPL by the Environmental Protection Agency in CERCLIS or any
similar state list of sites requiring investigation or clean-up.
(h) (i) No Liens have arisen under or pursuant to any Environmental
Laws on the Portfolio Assets or any site or facility that will be owned,
operated or leased by any Borrower Entity, and (ii) no government action has
been taken or is in process that could subject any of the Portfolio Assets or
any such site or facility to such Liens or that, individually or in the
aggregate, could reasonably be expected to result in a Material Adverse Effect.
No Borrower Entity will be required to place any notice or restriction relating
to the presence of Hazardous Materials at any of the Portfolio Assets or any
site or facility owned by it in any deed to the real property on which any of
the Portfolio Assets or such site or facility is located.
(i) The Portfolio Assets are in compliance with all Environmental Laws
and, to the Borrower's knowledge after reasonable inquiry, there is no reason to
believe that there are any facts or circumstances that will materially limit the
continued compliance of the operation of the Portfolio Assets with all
Environmental Laws or which would, other than as set forth in the Projections,
require material changes to the Portfolio Assets, or the operation thereof, to
comply with Environmental Laws in the future, except in any such case where such
non-compliance could not be reasonably expected to materially adversely effect
the operation or performance of any Portfolio Asset that is the subject of such
non-compliance.
Section 4.21 INSURANCE. All insurance policies required to be obtained
by the Borrower pursuant to Section 5.06 have been obtained and are in full
force and such insurance policies comply with the requirements of Section 5.06.
Section 4.22 TRANSACTIONS WITH AFFILIATES. Except as disclosed on
SCHEDULE 4.22 hereof, no Borrower Entity is a party to any contract or agreement
with, or has any other commitment of any nature or kind, to any Affiliate, which
would result in a breach of the Borrower's covenants and agreements set forth in
Section 6.09.
Section 4.23 ORGANIZATIONAL STRUCTURE. On the Closing Date, the
organizational structure of the Credit Parties is as set forth on SCHEDULE 4.23A
hereof. On the Ceredo Effective Date, the organizational structure of the Credit
Parties is as set forth on SCHEDULE 4.23B.
Section 4.24 PROJECTIONS. The Borrower has prepared or caused to be
prepared the Projections and is responsible for developing the assumptions on
which the Projections are based. As of the Ceredo Closing Date, the Projections
are, to the Borrower's knowledge after reasonable inquiry (a) based on
reasonable assumptions, including all legal and factual matters material to the
estimates set forth therein, and (b) consistent with the provisions of the
Transaction Documents; PROVIDED, that each of the Secured Parties hereby
acknowledges and agrees that such Projections may or may not prove to be correct
and that no representation or warranty is made as to whether actual performance
of the Portfolio Assets is or will be accurately reflected in such Projections.
Section 4.25 ENVIRONMENTAL INSURANCE.
(a) To the Borrower's knowledge after reasonable inquiry, all
Pollution Conditions existing in, on, under or from the Portfolio Assets
(excluding Ceredo) prior to the inception date of the Environmental Insurance
Policy are identified in the reports and documents on the Known Conditions List
and were disclosed in the application for the Environmental Insurance Policy.
(b) The Borrower reasonably believes, based on reasonable assumptions,
that all Scheduled Pollution Conditions identified on the Known Conditions List
which require any clean-up, investigation, remediation, corrective action or
monitoring under the Environmental Laws or which are otherwise necessary to
address a significant risk to human health or the environment are included in
the Pollution Conditions.
Section 4.26 EQUITY INTERESTS. The Borrower has free and clear title
to the equity interests of its Subsidiaries except for Permitted Liens, and all
pledged equity interests are validly issued, fully paid and non-assessable and
not subject to restrictions on transfer.
ARTICLE V
AFFIRMATIVE COVENANTS
The Borrower covenants and agrees that, so long as this Agreement is
in effect and any Lender shall have any Commitment outstanding hereunder, and
until the Notes, together with interest, and all other Obligations are
indefeasibly paid in full and all Letters of Credit have been cancelled or have
expired and all amounts drawn thereunder have been indefeasibly reimbursed in
full, the Borrower will, and as applicable will cause each of its Subsidiaries
to:
Section 5.01 CONDUCT OF BUSINESS; MAINTENANCE OF EXISTENCE. (a) Engage
solely in the business of owning, operating, maintaining and managing its
interests in the Portfolio Assets and in its Subsidiaries, (b) preserve and
maintain in full force and effect its existence as a partnership or limited
liability company, as applicable, under the laws of the state of its
organization and its qualification to do business in every jurisdiction where
the character of its properties or the nature of its activities makes such
qualification necessary, (c) preserve and maintain all of its rights,
privileges, permits and franchises necessary for the ownership, operation,
maintenance and management of the Portfolio Assets (other than rights,
privileges, permits and franchises necessary for the operation of the Phillips
facility, unless and until the Borrower elects to place such facility into
operation) and (d) subject to Section 6.11, keep all property useful and
necessary in its business in good working order and condition (except to the
extent that any such property is no longer required for the business of any
Borrower Entity), ordinary wear and tear excepted. No Borrower Entity shall
amend its Governing Documents in any manner, the result of which would be to
alter the distribution, nature of business, management, transfer of interests or
powers of the general partner provisions thereof.
Section 5.02 GOVERNMENTAL APPROVALS. Duly obtain on, or prior to, such
date as the same may be legally required, and thereafter maintain in effect as
long as legally required, all Governmental Approvals required under Section
4.04, except to the extent the failure to so obtain or maintain could not
reasonably be expected to result in a Material Adverse Effect.
Section 5.03 PAYMENT OF INDEBTEDNESS. Pay, discharge or otherwise
satisfy at or before maturity or before they become delinquent, as the case may
be, all of its Obligations and other Indebtedness and obligations of whatever
nature (except for any Indebtedness (other than the Obligations) or other
obligations which are being contested in good faith and by appropriate
proceedings if (a) Acceptable Reserves have been established, and (b) such
contest does not involve any unreasonable risk of the sale, forfeiture or loss
of any of the right, title estate and interest of any Borrower Entity in any
Portfolio Asset, taking into account the existence of such Acceptable Reserves).
Section 5.04 ACCOUNTS. Maintain all of the Accounts with the
Administrative Agent in accordance with the Deposit Account Agreement and the
other Financing Documents and, to the extent it is permitted to do so under the
Deposit Account Agreement, apply, or cause the application of, all amounts on
deposit therein from time to time as required by the Financing Documents.
Section 5.05 PERFORMANCE OF COVENANTS, ETC. Perform and observe all
material Contractual Obligations, including all of the covenants and agreements
contained in the Project Contracts to which it is a party and shall enforce
(including, as necessary, through negotiation, litigation or other reasonable
means) the material rights granted to it under and in connection with each of
the Transaction Documents.
Section 5.06 INSURANCE REQUIREMENTS. Procure and maintain with respect
to all Borrower Entities and all Portfolio Assets, as applicable, insurance
against physical loss, public liability, property damage, general liability,
business interruption, environmental risk and other insurance, with coverages
and limits in no event less than those set forth on SCHEDULE 5.06 hereto (and in
conformance with the requirements set forth thereon). The Borrower shall timely
pay all premiums due under all insurance policies required to be maintained
under this Section 5.06. Promptly upon receipt or delivery thereof by any
Borrower Entity, such Borrower Entity shall deliver to the Administrative Agent
all material notices relating to the Insurance Policies.
Section 5.07 BOOKS AND RECORDS. Keep proper books of records and
accounts in which full, true and correct entries shall be made of all of its
transactions in accordance with GAAP.
Section 5.08 VISITATION, INSPECTION, ETC. Permit representatives of
the Administrative Agent, the Independent Engineer and the Arrangers (at the
cost and expense of the Borrower so long as any Default or Event of Default
exists), and any other Lender (at the cost and expense of such Lender) to visit
and inspect any of the Portfolio Assets, to examine its books and records and to
make copies and take extracts therefrom, and to discuss its affairs, finances
and accounts with its officers and employees and its independent accountants,
all with reasonable prior notice and at such reasonable times as such Person may
reasonably request and subject to the applicable Borrower Entity's reasonable
rules and procedures regarding operation, safety and confidentiality.
Section 5.09 REQUIREMENTS OF LAW. Comply in all material respects with
all Requirements of Law and Governmental Approvals (a) applicable to it and the
Portfolio Assets, including all Environmental Laws and (b) required of any
Borrower Entity by virtue of any concessions and licenses held by the Borrower
Entity except when any such Requirement of Law or Governmental Approval is being
contested in good faith and by appropriate proceedings or, as appropriate,
settlement negotiations, and for which Acceptable Reserves have been
established; PROVIDED, HOWEVER, that no Borrower Entity shall be required to
establish Acceptable Reserves in respect of any "new source review" enforcement
action brought by the Environmental Protection Agency against such Borrower
Entity or any Portfolio Asset (other than for penalties which may be assessed as
a result of such enforcement action) that such Borrower Entity is contesting in
good faith or in respect of which such Borrower Entity is involved in settlement
negotiations. For purposes of the proviso contained in this Section 5.09 only,
the amount of Acceptable Reserves shall equal the greater of (i) $4,000,000 and
(ii) the amount required by GAAP to be included on the balance sheet or in any
contingency footnote in the financial statements of the Borrower.
Section 5.10 REPORTING REQUIREMENTS. Furnish to the Administrative
Agent:
(a) as soon as available, but in any event, within 45 days after the
end of each fiscal quarter of the Borrower, the unaudited consolidated balance
sheet of the Borrower and its Subsidiaries as at the end of each such quarter
and the related unaudited statement of income, partners' capital and cash flows
for such quarter and the portion of the fiscal year through the end of each such
quarter, in each case setting forth in comparative form the figures for the
corresponding quarter in the year immediately preceding such year, prepared in
accordance with GAAP, certified by a Responsible Officer of the Borrower as
being fairly stated in all material respects;
(b) as soon as available, but in any event, within 90 days after the
end of each fiscal year of the Borrower, the consolidated and consolidating
balance sheets of the Borrower and its Subsidiaries as at the end of such year
and the related statement of income, members' capital, cash flows and a
statement of sources and uses of all funds for such year, prepared in accordance
with GAAP and audited by Arthur Andersen LLP or any other independent certified
public accountants of recognized standing in the United States of America
reasonably satisfactory to the Administrative Agent and setting forth in each
case in comparative form the figures for the previous year, and a certificate as
to compliance with the Financing Documents, and a certificate from Arthur
Andersen (or such other independent certified public accountants selected by the
Borrower) whether, in the course of their audit, they have become aware of any
Default or Event of Default and, if any such Default or Event of Default exists,
specifying the nature and extent thereof;
(c) as soon as available, but in any event, not later than 60 days
after the commencement of each fiscal year of the Borrower, furnish forecasts
prepared by management in form and detail satisfactory to the Administrative
Agent, of projections (substantially in the form of the Projections) on a fiscal
period basis for such fiscal year and on a fiscal year basis for each of the
remaining fiscal years until at least twenty years beyond the Closing Date; and
(d) Each time the financial statements of the Borrower are delivered
under this Section 5.10, a certificate signed by a Responsible Officer of the
Borrower shall be delivered along with such financial statements, certifying
that such Responsible Officer has made or caused to be made a review of the
transactions and financial condition of the Borrower and its Subsidiaries during
the relevant fiscal period and that such review has not, to the best of such
Responsible Officer's knowledge, disclosed the existence of any event or
condition which constitutes a Default or an Event of Default under any Financing
Document to which any Borrower Entity is a party, or if any such event or
condition existed or exists, the nature thereof and the corrective actions that
the relevant Borrower Entity has taken or proposes to take with respect thereto,
and also certifying that each Borrower Entity is in compliance in all material
respects with its obligations under this Agreement and each other Financing
Document to which it is a party or, if such is not the case, stating the nature
of such non-compliance and the corrective actions which the relevant Borrower
Entity has taken or proposes to take with respect thereto.
Section 5.11 OPERATING BUDGET.
(a) Deliver to the Administrative Agent for its approval an Operating
Budget not less than 30 days in advance of each calendar year satisfying the
requirements contained in the definition thereof; provided, THAT, with respect
to any Operating Budget, if the Administrative Agent fails to approve such
Operating Budget or provides notice to the Borrower that it rejects all or any
portion of such Operating Budget, the Borrower and the Administrative Agent (in
consultation with the Independent Engineer) agree to work in good faith to
resolve such dispute; and PROVIDED, FURTHER, that if an Operating Budget is not
adopted and approved on or prior to the first day of any calendar year, the
Borrower Entities shall adhere to the Interim Operating Budget until such time
as an Operating Budget is adopted and approved by the Administrative Agent (in
consultation with the Independent Engineer); PROVIDED, FURTHER, that, upon
achievement of Commercial Operation with respect to Ceredo, the Borrower will
submit a supplement to the 2001 Operating Budget, acceptable to the Arrangers,
covering Ceredo.
(b) Subject to clauses (c) through (e) of this Section 5.11, operate
and maintain the Portfolio Assets or cause the Portfolio Assets to be operated
and maintained, in accordance with each Operating Budget.
(c) The Borrower Entities shall not make expenditures in respect of
Operating Costs in any fiscal year in an aggregate amount in excess of 105% of
the Budgeted Operating Costs for such fiscal year, PROVIDED THAT, the Borrower
Entities may make expenditures in any fiscal year in an aggregate amount in
excess of 105%, but less than or equal to 110%, of the Budgeted Operating Costs
for such fiscal year with the written consent of the Administrative Agent (after
consultation with the Independent Engineer) and may make expenditures in any
fiscal year in an aggregate amount in excess of 110% of the Budgeted Operating
Costs for such fiscal year with the written consent of the Required Lenders. The
Borrower Entities shall not make Capital Expenditures or Maintenance
Expenditures in any fiscal year in an aggregate amount in excess of 105% of the
Capital Expenditures or Maintenance Expenditures, as the case may be, set forth
in the Operating Budget in effect for such fiscal year; PROVIDED, THAT, the
Borrower Entities may make expenditures in any fiscal year in an aggregate
amount in excess of 105%, but less than or equal to 110%, of the budgeted
Capital Expenditures or Maintenance Expenditures, as the case may be, for such
fiscal year with the written consent of the Administrative Agent (after
consultation with the Independent Engineer) and may make expenditures in any
fiscal year in an aggregate amount in excess of 110% of the budgeted Capital
Expenditures or Maintenance Expenditures, as the case may be, for such year with
the written consent of the Required Lenders.
(d) The Borrower Entities shall not make re-allocations in respect of
any line item Budgeted Operating Cost in any fiscal year in excess of 5% of such
Budgeted Operating Cost for such fiscal year, provided that the Borrower
Entities may make re-allocations any fiscal year in an excess of 5%, but less
than or equal to 10%, of any line item Budgeted Operating Cost for such fiscal
year with the written consent of the Administrative Agent (after consultation
with the Independent Engineer) and may make re-allocations in any fiscal year in
excess of 10% of a line item Budgeted Operating Cost for such fiscal year with
the written consent of the Required Lenders.
(e) Notwithstanding the foregoing, in the event of any Emergency, the
Borrower Entities may make expenditures and/or reallocations in excess of the
limitations set forth in clauses (c) and (d) to the extent of such amount
reasonably necessary for the remediation of the conditions giving rise to such
Emergency and otherwise in accordance with Prudent Industry Practice; PROVIDED,
THAT, any expenditures made under this Section 5.11(e) in excess of $5,000,000
shall require the prior consent of the Required Lenders which consent shall not
be unreasonably withheld, conditioned or delayed. The Borrower Entities shall
notify the Administrative Agent in writing as soon as practicable after the
commencement of any such Emergency.
(f) The Borrower Entities shall undertake all Non-Discretionary
Capital Expenditures set forth from time to time in each approved Operating
Budget in accordance with such Operating Budget subject to the other provisions
of this Section 5.11. The Borrower Entities shall complete all Non-Discretionary
Capital Expenditures on or prior to the scheduled completion dates set forth in
the Projections and any approved Operating Budget, and shall procure all
Governmental Approvals and major equipment and perform all necessary
engineering, design and other services required in connection therewith at such
times as will permit the timely commencement and completion of such
Non-Discretionary Capital Expenditures.
(g) To the extent that modifications to, or deviations from, an
approved Operating Budget have been consented to by the Administrative Agent or
the Required Lenders, as applicable, such modifications or deviations shall be
deemed to amend such approved Operating Budget and all references in this
Agreement or the other Financing Documents to the Operating Budget shall be
deemed to refer to the Operating Budget as so amended.
Section 5.12 PAYMENT OF TAXES AND CLAIMS. Timely pay and discharge or
cause to be paid and discharged all taxes, assessments and governmental charges
or levies lawfully imposed upon any Borrower Entity or upon its respective
income or profits or upon any portion of the Portfolio Assets or the Collateral
and all lawful claims or obligations that, if unpaid, would become a Lien upon
the Collateral, real or personal, or upon any part thereof; PROVIDED, THAT, the
Borrower Entities shall have the right to contest in good faith the validity or
amount of any such tax, assessment, charge or levy by proper proceedings, and
may permit the taxes, assessments, charges or levies so contested to remain
unpaid during the period of such contest if: (a) such Borrower Entity diligently
prosecutes such contest in good faith and by appropriate proceedings and for
which Acceptable Reserves have been established; (b) during the period of such
contest, the enforcement of any contested item is effectively stayed; and (c)
the failure to pay or comply with the contested item could not reasonably be
expected to result in a Material Adverse Effect taking into account the
existence of such Acceptable Reserves.
Section 5.13 MAINTENANCE AND OPERATION OF PORTFOLIO ASSETS; REPAIR AND
REPLACEMENT OF PORTFOLIO ASSETS.
(a) Operate and maintain the Portfolio Assets (other than Phillips or
Ceredo to the extent Phillips or Ceredo, respectively, has not been put into
service by the Borrower or Twelvepole, as applicable) and conduct its business
(i) in accordance with Prudent Industry Practice and (ii) in accordance with the
terms of any insurance policy or policies in effect at any time with respect to
the Portfolio Assets or any part thereof; and
(b) After the occurrence of a loss, damage, destruction or taking of
any part of the Portfolio Assets (other than Phillips or Ceredo to the extent
Phillips or Ceredo, respectively, has not been put into service by the Borrower
or Twelvepole, as applicable), proceed diligently with all work necessary to
replace and/or repair such loss, destruction or damage to the extent required
pursuant to the terms of the Financing Documents.
Section 5.14 REAL AND PERSONAL PROPERTY.
(a) Maintain good title to or valid leasehold, easement or
right-of-way interests in the material property, assets or revenues on which it
purports to own, lease or hold any such interest in, free and clear of all Liens
(except Permitted Liens), including the possession of all real estate interests
and licenses, Intellectual Property and other proprietary rights required for
the ownership, operation and maintenance of the Portfolio Assets in accordance
with Prudent Industry Practice and as contemplated by the Transaction Documents.
(b) It is agreed by Borrower that the Harwick Mine Complex is not
intended to be included in the Portfolio Assets and that the Borrower shall not
hold title or other indicia of ownership to the Harwick Mine Complex at any time
during the term of the Loan.
Section 5.15 ERISA.
(a) The Borrower shall deliver to the Administrative Agent, if and
when any Borrower Entity, the Operator or any ERISA Affiliate (i) gives or is
required to give notice to the PBGC of any "reportable event" (as defined in
Section 4043 of ERISA) with respect to any Plan, other than a reportable event
for which 30-day notice to the PBGC has been waived by the PBGC, or knows that
the plan administrator of any Plan has given or is required to give notice of
any such reportable event, a copy of the notice of such reportable event given
or required to be given to the PBGC; (ii) receives notice of complete or partial
withdrawal liability under Title IV of ERISA or notice that any Multiemployer
Plan is in reorganization, is insolvent or has been terminated, a copy of such
notice; (iii) receives notice from the PBGC under Title IV of ERISA of an intent
to terminate, impose liability in respect of, or appoint a trustee to administer
any Plan, a copy of such notice; (iv) applies for a waiver of the minimum
funding standard under Section 412 of the Code, a copy of such application; (v)
gives notice of intent to terminate any Plan under Section 4041(c) of ERISA, a
copy of such notice and other information filed with the PBGC; (vi) gives notice
of withdrawal from any Plan pursuant to Section 4063 of ERISA, a copy of such
notice; or (vii) fails to make any payment or contribution to any Plan or
Multiemployer Plan or in respect of any Benefit Arrangement or makes any
amendment to any Plan or Benefit Arrangement which in either case would trigger
the provisions of Section 412(n) or 401(a)(29) of the Code (or any corresponding
provisions of ERISA), a certificate of the chief financial officer or the chief
accounting officer of the Borrower setting forth details as to such occurrence
and action, if any, which the Borrower or applicable ERISA Affiliate is required
or proposes to take.
(b) Unless the Required Lenders provide their express, advance written
consent, none of the Borrower Entities and the Operator shall (i) sponsor,
maintain, contribute to or otherwise incur any obligation with respect to any
Plan or Multiemployer Plan that, as of the Closing Date, the Borrower or the
Operator did not sponsor, maintain, contribute to or otherwise have any
obligation with respect to, or (ii) permit any interest in the Operator to be
sold or transferred, either directly or indirectly, to any Person other than the
Borrower or any ERISA Affiliate with respect to any Plan.
Section 5.16 INTEREST HEDGE CONTRACTS.
(a) Enter into Interest Hedge Contracts only with one or more of the
Lenders; PROVIDED, THAT, the Borrower shall not, at any time, enter into
Interest Hedge Contracts in respect of principal Obligations in excess of
$750,000,000. Except pursuant to and to the extent of, any prepayment of
outstanding Loans, the Borrower shall not terminate any Interest Hedge Contract
without the prior written consent of the Administrative Agent.
(b) Within 15 Business Days after the Closing Date, the Borrower shall
enter into one or more Interest Hedge Contracts in respect of the aggregate
principal amount of $250,000,000 and having an aggregate weighted average
maturity of seven (7) years from the date of delivery thereof.
(c) Within ten (10) Business Days of the occurrence of any Swap
Trigger Event during the period from the Closing Date to the date which is 24
months thereafter, the Borrower shall enter into one or more Interest Hedge
Contracts with one or more Swap Banks in respect of the aggregate principal
amount of $300,000,000 (less the aggregate principal amount of Obligations then
subject to an Interest Hedge Contract) and having an aggregate weighted average
maturity of seven (7) years from the date of delivery thereof.
Section 5.17 NOTICES. Promptly upon obtaining actual knowledge
thereof, give notice to the Lenders of:
(a) any Default or Event of Default, together with a description of
any action being taken or proposed to be taken with respect thereto;
(b) any action, suit, arbitration, litigation, investigation or
proceeding involving or affecting any Borrower Entity or any Portfolio Asset or
any Major Project Party involving $1,000,000 or more or seeking any injunctive,
declaratory or other equitable relief;
(c) any action, suit, arbitration, litigation, investigation or
proceeding instituted for the purpose of revoking, terminating, suspending,
withdrawing, modifying or withholding any material Governmental Approval
necessary for any Borrower Entity or any other Major Project Party to perform
its obligations or exercise its rights under any Project Contract or for the
operation or maintenance of the Portfolio Assets in the manner contemplated by
the Transaction Documents;
(d) proposed execution of any Additional Contract;
(e) any casualty, loss or damage to any Portfolio Asset, whether or
not insured, involving a probable loss of $1,000,000 or more;
(f) any termination, material default or event of default or notice
thereof under any Project Contract;
(g) any change in the Responsible Officers of any Borrower Entity,
together with evidence of authority thereof and specimen signature;
(h) any fact, circumstance, condition or occurrence that is reasonably
likely to form the basis of a material Environmental Claim arising with respect
to the Portfolio Assets against any Borrower Entity or any pending or threatened
material Environmental Claim arising with respect to the Portfolio Assets
against any Borrower Entity, describing the same in reasonable detail and,
together with or as soon thereafter as is reasonably possible, a description of
the action that the applicable Borrower Entity has taken or proposes to take
with respect thereto and, thereafter, from time to time such detailed reports
with respect thereto as the Administrative Agent or any Lender (through the
Administrative Agent) may reasonably request;
(i) promptly upon their becoming available, copies of all written
communications with any Governmental Authority relating to any material
violation or alleged material violation of any material Environmental Law or
other Environmental Claim arising out of the Portfolio Assets;
(j) promptly upon receipt or delivery thereof by any Borrower Entity,
copies of all notices and other information that any Borrower Entity receives
from, or delivers to, any Governmental Authority that could reasonably be
expected to be materially adverse to the Portfolio Assets;
(k) any Emergency; and
(l) any other event or development that could reasonably be expected
to have a Material Adverse Effect.
Section 5.18 PRESERVATION OF SECURITY INTERESTS; FURTHER ASSURANCES.
(a) Preserve, or cause to be preserved, the security interests granted
under the Security Documents and undertake all actions which are necessary or
appropriate in the reasonable judgment of the Administrative Agent to (i)
maintain the Secured Parties' security interest in the Collateral in full force
and effect at all times (including the priority thereof, other than with respect
to vehicles and boats) and (ii) preserve and protect the Collateral and protect
and enforce each Borrower Entity's rights and title and the rights of the
Secured Parties to the Collateral, including, without limitation, the making or
delivery of all filings and recordations, the payments of fees and other charges
and the issuance of supplemental documentation.
(b) Upon notice from the Administrative Agent, take or cause to be
taken all action required or, in the reasonable opinion of any Secured Party,
which is desirable to maintain and preserve the Liens of the Security Documents
and execute or cause to be executed any and all further instruments (including
financing statements, continuation statements and similar statements with
respect to any of the Security Documents) requested by the Administrative Agent
for such purpose.
Section 5.19 USE OF PROCEEDS. Use all proceeds of Acquisition Loans
solely in accordance with Section 2.01(d). Use all proceeds of Revolving Loans
solely in accordance with Section 2.02(d). Use any DLC Letter of Credit solely
in accordance with Section 2.16(k). Use any Operational Letter of Credit solely
in accordance with Section 2.17(k). Neither any part of the proceeds of any Loan
nor any Letter of Credit will be used by any Borrower Entity to purchase or
carry any Margin Stock or to extend credit to any other Person for the purpose
of purchasing or carrying any Margin Stock.
Section 5.20 EXTRAORDINARY PROCEEDS. Promptly apply all payments in
respect of Insurance Proceeds or Condemnation Proceeds received by, or for the
account of, any Borrower Entity in accordance with the terms of the Deposit
Account Agreement.
Section 5.21 ENVIRONMENTAL COMPLIANCE.
(a) The Borrower Entities shall not use or Release, or permit the use
or Release of, Hazardous Materials at the site of any Portfolio Asset other than
in material compliance with all applicable Environmental Laws; PROVIDED, THAT,
the Borrower Entities shall have the right to contest or engage in settlement
negotiations with respect to such Environmental Laws in accordance with Section
5.09.
(b) Conduct and complete any investigation, study, sampling and
testing and undertake any cleanup, removal, remedial or other action necessary
to remove and clean up all Hazardous Materials Released at, on, in, under or
from the Portfolio Assets, in accordance with the requirements of all applicable
Environmental Laws, except where the failure to do so could not reasonably be
expected to result in a Material Adverse Effect.
(c) (i) Within ninety (90) days of the Closing Date, the Borrower
shall submit to the Administrative Agent a plan for the additional investigation
and delineation of the Scheduled Pollution Conditions as necessary to develop
the proposed Remedial Action Plan as described below (the "INVESTIGATION Plan").
The Borrower shall promptly implement and diligently conduct and complete the
tasks set forth in the Investigation Plan and shall deliver the results thereof
to the Administrative Agent. Within sixty (60) days of completion of the tasks
set forth in the Investigation Plan, the Borrower shall deliver to the
Administrative Agent a plan for the monitoring, clean-up, removal, remediation
or corrective action of the Scheduled Pollution Conditions (the "REMEDIAL ACTION
PLAN"). The Borrower shall promptly implement and diligently conduct and
complete the tasks set forth in the Remedial Action Plan. The Borrower shall
provide the Administrative Agent a brief written report documenting the progress
of the implementation of the Remedial Action Plan annually beginning after
approval of the Remedial Action Plan. The Borrower shall conduct all work in
connection with the Investigation Plan and the Remedial Action Plan so as to
qualify as Clean-Up Costs and to otherwise be credited toward the self-insured
retention under the Environmental Insurance Policy.
(ii) The Borrower shall promptly provide the Administrative Agent
upon request with copies of any (a) reports of material claims made to the
insurer pursuant to the Environmental Insurance Policy or claims or accountings
made under the self-insured retention under the Environmental Insurance Policy
and (b) denials, partial denials or reservations of rights in respect to any
such material claims or accountings received from an insurer. The Borrower shall
report claims to the insurer pursuant to the Environmental Insurance Policy for
any Pollution Conditions which the Borrower reasonably believes based upon
reasonable assumptions will exceed $25,000 in Clean-Up Costs; however, this
covenant shall in no way prohibit the Borrower from reporting claims pursuant to
the Environmental Insurance Policy for amounts below $25,000 in Clean-Up Costs.
The Borrower shall make all claims or accountings to the insurer under the
Environmental Insurance Policy for all Clean-Up Costs incurred in connection
with the Investigation Plan or the Remedial Action Plan. Such claims or
accountings shall be made in accordance with the terms of the Environmental
Insurance Policy.
(iii) The Borrower shall assure that the insurer adds any
off-site location for the disposal of waste from any of the Portfolio Assets on
the Non-Owned Covered Locations Schedule under the Environmental Insurance
Policy before disposing of any such waste or entering into any contractual
arrangement permitting any such disposal.
(iv) The Borrower shall assure that a listing of transporters and
listing of material to be transported is delivered to the insurer within the
time period specified under the Environmental Insurance Policy to maintain the
"transported cargo" (as defined under the Environmental Insurance Policy)
coverage under the Environmental Insurance Policy and shall only use such
insured transporters for transporting of materials that could reasonably result
in Pollution Conditions.
(v) The Borrower shall assure that computer or hand copies of
legal descriptions for the Portfolio Assets are delivered to the insurer within
fifteen (15) days of the date of purchase of the Portfolio Assets by the
Borrower.
(vi) The Borrower shall assure that promptly after the Closing
Date all underground storage tanks to be owned or operated by the Borrower at
any of the Portfolio Assets are listed on the "Schedule of Underground Storage
Tanks" to the Environmental Insurance Policy.
(d) The Borrower is planning to replace the economizer and repair the
steam turbine at unit 9 at Avon Lake in early 2001. The Borrower plans to
address Prevention of Significant Deterioration permitting under 40 C.F.R. ss.
52.21 and Ohio Admin. Code ss. 3745-31 by having no "significant" air emissions
increase. In connection with making such repair and replacement, the Borrower
has filed an application for a Ohio air permit to construct under Ohio Admin.
Code ss. 3745-31 and has or shall incorporate into such application and
subsequent submission the "actuals to future actuals showing" that demonstrates
that there will be "no significant net emission increase" under 40 C.F.R. ss.
52.21 and Ohio Admin. Code ss. 3745-31, including, without limitation, the
baseline and the basis for no emissions increase. Based on the above, the
Borrower shall comply with the reporting requirements in such Ohio air permit to
construct and not exceed in its operations the "future actual emissions" which
are provided in the application to Ohio for the air permit to construct. The
Borrower shall provide the Administrative Agent with a copy of the complete
application for the Ohio air permit to construct and any amendments thereto
promptly upon submission to Ohio and a copy of any draft or final air permit to
construct issued by Ohio promptly upon receipt. Upon the request of the
Administrative Agent, the Borrower shall provide evidence of compliance with
this Section 5.21(d).
(e) Borrower shall file and use all reasonable efforts to obtain on or
before December 31, 2000 a Prevention of Significant Deterioration air permit to
construct under applicable federal and state law for the refurbishment of three
combustion turbines at Brunot Island identified as units 2A, 2B and 3 and the
installation of heat recovery steam generators so that they can operate as
combined cycle units.
Section 5.22 ADDITIONAL CONTRACTS.
(a) Enter into Additional Contracts (other than the Additional
Contracts, if any, relating to Ceredo, identified on SCHEDULE 5.22 attached
hereto) only with the prior written consent of the Required Lenders, which
consent shall not be unreasonably withheld, conditioned or delayed; PROVIDED
that no such consent shall be required to the extent such Additional Contracts
were entered into in response to an Emergency in accordance with Prudent
Industry Practice. The Borrower shall notify the Administrative Agent in writing
as soon as practicable after the commencement of any such Emergency.
(b) If any Borrower Entity shall at any time enter into an Additional
Contract, the Borrower shall promptly upon such acquisition or execution,
execute, deliver and record, or cause to be executed, delivered and recorded, a
supplement to the Security Documents, satisfactory in form and substance to the
Administrative Agent, subjecting such Additional Contract to the Lien and
security interests created by the Security Documents, ensure that the security
interest in such interest will be a valid and an effective interest on terms
comparable to the security interest of the Secured Parties in the Collateral,
and deliver to the Administrative Agent, a duly executed and delivered
Additional Contract Consent in respect of each Additional Contract.
Section 5.23 OTHER INFORMATION. Furnish to the Administrative Agent:
(a) on each anniversary of the Closing Date, a certificate from the
Borrower's insurers or insurance agents (i) evidencing that the insurance
policies in place satisfy the requirements of this Agreement and (ii) setting
forth a summary of all losses in excess of $1,000,000 incurred with respect to
the Portfolio Assets in the preceding year; and
(b) any such other information or data with respect to its business or
operations (including supporting information as to compliance with this
Agreement) as the Administrative Agent may reasonably request from time to time.
Section 5.24 FUEL PROCUREMENT AND O&M ARRANGEMENTS.
(a) Deliver to the Administrative Agent for its approval a Fuel Plan
not less than 30 days in advance of each April 1, covering the period form April
1 through the following March 31, satisfying the requirements contained in the
definition thereof; PROVIDED, THAT, with respect to any Fuel Plan, if the
Administrative Agent fails to approve such Fuel Plan or provides notice to the
Borrower that it rejects all or any portion of such Fuel Plan, the Borrower and
the Administrative Agent (in consultation with the Fuel Consultant) agree to
work in good faith to resolve such dispute. The Borrower Entities shall conduct
the procurement, purchase and use of fuel and, to the extent covered by the Fuel
Plan, the operation of the Portfolio Assets (excluding Ceredo, until Ceredo has
achieved Commercial Operation) in all material respects in accordance with the
then current Fuel Plan.
(b) Perform operation and maintenance of the Portfolio Assets
(excluding Ceredo, until Ceredo has achieved Commercial Operation), or contract
for the provision thereof as permitted by this Agreement, in all material
respects in accordance with the O&M Plan.
Section 5.25 POWER MARKETING AND TRANSMISSION ARRANGEMENTS.
(a) The Borrower shall deliver to the Administrative Agent for its
approval a Power Marketing Plan on or prior to March 1 of each year satisfying
the requirements contained in the definition thereof and containing, at minimum,
on a month by month basis the projected Total Capacity and the projected Total
Load Forecast, together with a detailed discussion of how the Borrower
anticipates meeting necessary obligations to comply with Section 5.25(b) below
for the period from April 1st of such year until March 31st of the subsequent
year; PROVIDED, THAT, with respect to any Power Marketing Plan, if the
Administrative Agent fails to approve such Power Marketing Plan or provides
notice to the Borrower that it rejects all or any portion of such Power
Marketing Plan, the Borrower and the Administrative Agent (in consultation with
the Power Marketing Consultant and the Independent Engineer) agree to work in
good faith to resolve such dispute. In all events the Borrower Entities will
sell all ancillary services, energy and capacity that is to be sold more than 90
days forward pursuant to an Approved Power Sales Agreement. All ancillary
services, energy and capacity that is sold pursuant to Spot Power Sales
Agreements shall be sold to either (i) an Approved Capacity Purchaser or (ii)
any Person who, after giving effect to any transaction, does not owe more than
$25,000,000 in the aggregate in currently invoiced amounts to the Borrower
Entities. Without limiting the provisions of this Section 5.25, the Borrower
Entities (either themselves or through an Affiliate or agent) shall conduct the
marketing or sale of power, electric capacity and/or energy produced by the
Portfolio Assets or the purchase of any thereof that is necessary or advisable
for the performance of its material obligations under each Project Contract and
in all material respects in accordance with the then current Power Marketing
Plan.
(b) The Borrower shall at all times cause Total Capacity to exceed
Total Load Forecast. On or prior to the first (1st) Business Day of each
calendar quarter (each, a "DETERMINATION DATE"), the Borrower shall provide
evidence reasonably satisfactory to the Administrative Agent (in consultation
with the Power Market Consultant) that such condition will be satisfied for the
immediately following three (3) month period beginning with such Determination
Date. For the purposes of determining compliance with the foregoing covenant,
if, on any date, the Borrower shall have failed to comply with the requirements
of this Section 5.25(b) as a result of an unplanned outage of 200 MW or less,
which unplanned outage can reasonably be expected to be cured within 14 days
from such date, then the Borrower shall be deemed to be in compliance with this
Section 5.25(b) notwithstanding such failure.
(c) The Borrower Entities shall maintain such access or other rights
to transmission capacity (including firm and/or non-firm and interstate and/or
non-interstate transmission capacity, as the case may be) as may be required for
the Borrower Entities to conduct successfully any marketing or sale of ancillary
services, electric capacity and/or energy produced by the Portfolio Assets
(excluding Ceredo, until Ceredo has achieved Commercial Operation), or the
purchase of any thereof, in accordance with any then current Power Marketing
Plan and all applicable Project Contracts.
Section 5.26 CAPITAL EXPENDITURES. (a) The Borrower shall cause the
following actions in respect of the Brunot Island Pipeline to be completed on or
prior to the indicated dates: (i) execution and delivery of definitive
documentation relating to the engineering, procurement and construction of the
Pipeline on or prior to September 30, 2000; (ii) receipt of all permits
necessary for the construction, installation and use of the Pipeline on or
before June 30, 2001; (iii) commencement of construction on or prior to
September 30, 2001 and (iv) completion of installation, construction, testing
and initial operation of the Pipeline on or prior to June 30, 2002.
(b) The Borrower shall cause the following actions in respect of the
installation of a new heat recovery steam generator and reactivation of the
three Frame 7 combustion turbines into combined-cycle operation at Brunot Island
(the "BRUNOT ISLAND REACTIVATION PROJECT") to be completed on or prior to the
indicated dates: (i) filing of applications for all Governmental Approvals
necessary for the construction, installation and operation of the Brunot Island
Reactivation Project on or prior to June 30, 2000; (ii) receipt of all such
Governmental Approvals on or prior to March 31, 2001; (iii) placement of orders
for all major equipment necessary for the Brunot Island Reactivation Project on
or prior to March 31, 2001; (iv) execution and delivery of definitive
documentation for the engineering, procurement and construction of the Brunot
Island Reactivation Project on or prior to December 31, 2001; (v) receipt of the
major equipment described in clause (iii) above by the Borrower on or prior to
June 30, 2002 and (vi) completion of installation, construction, testing and
initial operation of the Brunot Island Reactivation Project on or before
December 31, 2002.
(c) The Borrower shall cause the following actions in respect of the
replacement of the economizer at Avon Lake Unit 9 (the "AVON LAKE PROJECT") to
be completed on or prior to the indicated dates: (i) placement of orders for
major equipment necessary for the Avon Lake Project on or prior to June 30,
2000; (ii) receipt of such major equipment on or prior to March 31, 2001 and
(iii) completion of installation of equipment, construction, testing and initial
operation of the Avon Lake Project on or prior to June 30, 2002.
Section 5.27 POLR II AGREEMENT. In the event the Pennsylvania Utility
Commission (the "PUC") at any time requires any changes to the POLR II Agreement
as in effect on the Closing Date (including, without limitation, the Retail
Tariff and Generation Rates provided for therein and the prices paid to the
Borrower thereunder) which changes (taken as a whole) are adverse to the
interests, taken as a whole, of the Borrower or the Lenders, then the Borrower
shall, within fifty (50) days from the date of any order from the PUC evidencing
any such change, terminate the POLR II Agreement.
Section 5.28 CEREDO SECURITY DOCUMENTS. As soon as practical, but not
later than February 15, 2001 (except as otherwise agreed by the Arrangers in
their sole discretion), unless there shall have occurred a Closing Failure and
the Administrative Agent shall have applied the amounts on deposit in the Equity
Proceeds Account to the prepayment of the Loans and otherwise as provided in
Section 5.3(b) of the Deposit Account Agreement, the Borrower, at the Borrower's
expense, shall have taken any and all action necessary to cause the following:
(i) execution and delivery by Twelvepole and delivery to the Administrative
Agent of the Twelvepole Mortgage, the Twelvepole Security Agreement and the
Twelvepole Supplemental Agreement; (ii) execution by all parties thereto and
delivery to the Administrative Agent of the Wayne County Commission Consent, the
Mountaineer Consent and the AEP Consent; (iii) delivery to the Administrative
Agent of one or more original lender's policies of title insurance issued by
First American Title Insurance Company or one or more other title companies
acceptable to the Arrangers with such endorsements and coverage as the Arrangers
request insuring the liens created by the Twelvepole Mortgage in a manner
reasonably acceptable to the Arrangers; (iv) execution and delivery to the
Administrative Agent of any and all Financing Statements and other documents and
the taking of any and all other actions reasonably requested by the
Administrative Agent or the Required Lenders to establish, perfect and protect,
in favor of the Administrative Agent (for the benefit of the Secured Parties), a
first priority security interest, lien, pledge and assignment of all properties
and assets of Twelvepole (other than motor vehicles and boats); (v) delivery to
the Administrative Agent of such UCC, judgment, tax and other lien searches with
respect to the personal property of Twelvepole as the Administrative Agent or
the Required Lenders may reasonably request to verify the perfection and
priority of such security interests, liens, pledges and assignments; (vi)
execution and delivery to the Administrative Agent of opinions of counsel
reasonably satisfactory to the Administrative Agent and the Required Lenders
covering such matters with respect to the foregoing as the Administrative Agent
and the Required Lenders may reasonably request; (vii) receipt by the
Administrative Agent of a certificate of a Responsible Officer of the Borrower
certifying that all representations and warranties made by the Borrower in
Article IV hereof as they relate to Twelevepole, Ceredo or the other properties
and assets of Twelvepole are true in all respects as if made on and as of the
date of such certificate (subject to such qualifications with respect to such
matters as may be set forth in updated Schedules hereto delivered to the
Administrative Agent and are acceptable to the Arrangers); and (viii) delivery
to the Administrative Agent of such other statements, certificates, documents
and other information with respect to the matters contemplated by this Section
5.28 as the Arrangers may reasonably request.
ARTICLE VI
NEGATIVE COVENANTS
The Borrower covenants and agrees that, so long as this Agreement is
in effect and any Lenders shall have any Commitment outstanding hereunder, and
until the Notes, together with interest, and all other Obligations are
indefeasibly paid in full and all Letters of Credit have been cancelled or have
expired and all amounts drawn thereunder have been indefeasibly reimbursed in
full, the Borrower shall not, and shall not permit any of its Subsidiaries to:
Section 6.01 LIMITATION ON MERGERS. Merge or consolidate with or into
any other Person or liquidate, wind up, dissolve or otherwise transfer or
dispose of all or substantially all of its property, assets or business, acquire
all or substantially all of the assets of any Person or abandon the Portfolio
Assets.
Section 6.02 LIMITATION ON INDEBTEDNESS. Create, incur, assume or
suffer to exist any Indebtedness, other than Permitted Indebtedness.
Section 6.03 LIMITATION ON LIENS. Create or permit to exist any Lien
or encumbrance on any Portfolio Assets or any other assets of any Borrower
Entity, other than Permitted Liens.
Section 6.04 NATURE OF BUSINESS. Change its legal form or Governing
Documents, change its fiscal year nor engage in any business other than the
acquisition, ownership, operation and financing of the Portfolio Assets as
contemplated by the Transaction Documents, provided, that the Lenders hereby
expressly consent to the amendment of the business purpose clauses of the
Governing Documents of the Borrower and the General Partner to the extent
necessary to reflect the acquisition and ownership of the membership interests
of Twelvepole and the development, construction, ownership and operation of
Ceredo by Twelvepole as contemplated hereby. The Borrower Entities shall not
engage in the sale or trading of any fuel (i) to the extent such fuel is
necessary for the operation of any Portfolio Assets (including reasonable
reserves thereof) or (ii) on terms materially different from those set forth in
the Fuel Plan then in effect.
Section 6.05 PROJECT CONTRACTS; WAIVER; MODIFICATION; AMENDMENT.
(a) Terminate, or agree to any termination of, any Transaction
Document to which it is a party or any of its Governmental Approvals, unless the
Borrower first obtains the written consent of the Required Lenders.
(b) Amend or modify, or consent or agree to any amendment or
modification of, or waive timely performance by any Person of its material
obligations under or in respect of, any Project Contract (other than (i) change
orders relating to the construction of Ceredo that do not (A) delay Commercial
Operation of the "Facility" (as defined in the Ceredo EPC Contract) beyond July
1, 2001, (B) change any of the "Performance Tests" or "Performance Test
Procedures" as defined in the Ceredo EPC Contract, except as may be consented to
by the Arrangers, or (C) otherwise amend or modify the definition of
"Substantial Completion" in the Ceredo EPC Contract or the requirements
necessary to achieve "Substantial Completion" thereunder, except as may be
consented to by the Arrangers, (ii) assignment of the Ceredo Generator Purchase
Order to Twelvepole in accordance with Section 3.03(h) hereof, (iii) amendment
of the business purpose clauses of the Governing Documents of the Borrower and
the General Partner to the extent necessary to reflect the acquisition and
ownership of the membership interests of Twelvepole and the development,
construction, ownership and operation of Ceredo by Twelvepole as contemplated
hereby and (iv) amendments to the POLR I Agreement and the POLR II Agreement
pursuant to that certain Amended and Restated POLR II Agreement, dated as of
December 7, 2000 (the "AMENDED POLR II AGREEMENT"), between Duquesne Light
Company and the Borrower and any changes, amendments or modifications to the
Amended POLR II Agreement (in each case, taken as a whole) which are not adverse
to the interests, taken as a whole, of the Borrower or the Lenders, as
determined by the Arrangers), Operational Plan or Acquisition Document to which
it is a party or any material Governmental Approval, unless the Borrower first
obtains the consent of the Required Lenders, which consent will not be
unreasonably withheld, delayed or conditioned, upon demonstration to the
reasonable satisfaction of the Required Lenders (in consultation with the
Independent Engineer, Fuel Consultant or Power Marketing Consultant, as
applicable) that the proposed action could not reasonably be expected to have a
Material Adverse Effect. Upon granting any such consent by the Required Lenders
with respect to a Project Contract, the Administrative Agent shall forthwith
grant consent to such amendment or modification required under the Consent
applicable to any such Project Contract.
(c) Assign, sell, convey or otherwise transfer any of its obligations
under the POLR Agreement, the POLR II Agreement or any agreement in replacement
thereof, without the prior written consent of the Required Lenders.
Section 6.06 PARTNERSHIPS; SUBSIDIARIES. Become a general or limited
partner in any partnership or a joint venture in any joint venture, acquire any
ownership interest in any other Person or enter into any profit-sharing or
royalty agreement or other similar arrangement whereby the Borrower Entity's
income or profits are, or might be, shared with any other Person, or enter into
any management contract or similar arrangement whereby its business or
operations are managed by any other Person (other than the O&M Agreement or as
contemplated in any Power Marketing Plan and/or Fuel Plan and/or, with respect
to the management of Twelvepole, as provided in Section 6.09) or form any
Subsidiary.
Section 6.07 LOANS, ADVANCES OR INVESTMENTS. Make or permit to remain
outstanding any loans, extensions of credit or advances to or investments in
(whether by acquisitions of any stocks, notes or other securities or
obligations) any Person, except Permitted Investments or as expressly
contemplated by this Agreement.
Section 6.08 LIMITATION ON CAPITAL EXPENDITURES. Make any Capital
Expenditure other than such Capital Expenditures that are (a) contemplated by
the annual Operating Budget in effect for such fiscal year (as administered
pursuant to Section 5.11), or (b) provided no Event of Default has occurred and
is continuing, (x) determined in writing by the Administrative Agent (after
consultation with the Independent Engineer) to be required by applicable
Requirements of Law or to be reasonable and necessary and to arise from
circumstances which could not reasonably have been anticipated, which
determination will not be unreasonably withheld, conditioned or delayed, or (y)
required as a result of an Emergency.
Section 6.09 AFFILIATE TRANSACTIONS. Except as expressly contemplated
by the Financing Documents or any Operational Plan (and, with respect to the
management of Twelvepole, as contemplated in the management services agreements
attached hereto as EXHIBIT Y), directly or indirectly enter into any transaction
with any Affiliate or any other Person other than in the ordinary course of
business and on an arm's-length basis.
Section 6.10 DISTRIBUTIONS. Declare or pay any Distributions in
respect of any Person's ownership interest in the Borrower other than Permitted
Distributions or declare or pay Distributions, in the aggregate, in excess of
the Maximum Permitted Distribution Amount (other than Distributions of funds to
the Sponsor pursuant to Section 5.3(c) of the Deposit Account Agreement).
Section 6.11 LIMITATION ON DISPOSITION OF ASSETS. Convey, sell, lease,
assign, transfer or otherwise dispose of any of its assets (including,
equipment, inventory and other physical assets of similar nature), other than
(a) electricity, capacity, ancillary services, steam, ash and other coal process
by-products, scrap metal and other scrap materials, and excess fuel conveyed,
sold, leased, assigned, transferred or otherwise disposed of in the ordinary
course of the Borrower Entity's business, (b) such assets that are replaced
within 60 days by other assets of like utility in the Borrower Entity's
business; PROVIDED, THAT, this clause (b) above shall not permit any sale of
assets for an aggregate sales price in excess of $7,500,000 in any calendar year
during the term hereof, and (c) obsolete or surplus assets or assets not
required in connection with the operation of the Portfolio Assets as
contemplated by the Transaction Documents. All proceeds of any disposition of
such assets pursuant to clauses (a) and (b) above shall be deposited into the
Revenue Account for application therefrom in accordance with the Deposit Account
Agreement. All proceeds of any disposition of such assets pursuant to clause (c)
above shall be applied to the prepayment of Loans to the extent required under
Section 2.07(a) and shall be deposited into the Extraordinary Proceeds Account
pursuant to the Deposit Account Agreement. Notwithstanding the foregoing,
Twelvepole shall be permitted (i) to transfer transmission assets back to
American Electric Power Service Corporation in accordance with the Ceredo
Interconnection and Operation Agreement and (ii) to transfer interests in Ceredo
to the County Commission of Wayne County, West Virginia, in accordance with the
terms and provisions of the Ceredo Lease Agreement as in effect on the Ceredo
Closing Date, without waiver of any condition precedent to the obligations of
Twelvepole thereunder (except as may be approved by the Required Lenders);
PROVIDED that, contemporaneously with any such transfer to the County Commission
of Wayne County, West Virginia, the Borrower shall deliver to the Administrative
Agent (to be held as Collateral for the benefit of the Secured Parties, in
accordance with the Security Documents) all bonds issued under the Ceredo Bond
Indenture and delivered in connection therewith, accompanied by undated
assignments executed in blank. So long as no Default (except to the extent
waived by the Arrangers for the purposes of this sentence) or Event of Default
(except to the extent waived by the Required Lenders for the purposes of this
sentence) shall have occurred and be continuing, Lenders agree, and authorize
the Administrative Agent acting on their behalf, in connection with any such
transfer of interests in Ceredo in accordance with the Ceredo Lease Agreement,
to release the lien of the Twelvepole Mortgage in respect of such interests,
subject to receipt by the Administrative Agent of evidence, in form and
substance reasonably satisfactory to the Administrative Agent (which may involve
the issuance or verification of a mortgagee's policy of title insurance and/or
opinions of counsel), of the creation or reservation of a first priority
perfected lien and security interest on and in Twelvepole's leasehold interest
under the Ceredo Lease Agreement in the property so transferred.
Section 6.12 OPERATING BUDGET. Amend, adjust, modify or re-allocate
any portion of the Operating Budget except as specifically permitted in Section
5.11.
Section 6.13 DEBT SERVICE COVERAGE RATIO. (a) On the Quarterly Payment
Date occurring on March 31, 2001, fail to maintain a Debt Service Coverage Ratio
of at least 1.25 to 1.00 for the three month period immediately preceding such
date, or (b) on the Quarterly Payment Date occurring on June 30, 2001, fail to
maintain an average annual Debt Service Coverage Ratio of at least 1.30 to 1.00
for the twelve month period immediately preceding such date, or (c) on any
Quarterly Payment Date occurring on and after September 30, 2001, fail to
maintain an average annual Debt Service Coverage Ratio of at least 1.50 to 1.00
for the twelve-month period immediately preceding any date of determination of
such Debt Service Coverage Ratio.
Section 6.14 ENVIRONMENTAL INSURANCE. Add any properties not included
within the Portfolio Assets (with the exception of the Harwick Mine Complex
which may be added) to the insured properties under the Environmental Insurance
Policy or any matters to the Environmental Insurance Policy which are not
identified as covered locations under the Environmental Insurance Policy without
the prior written consent of the Administrative Agent, which consent shall not
be unreasonably withheld, conditioned or delayed; provided, that, the Borrower
delivers to the Administrative Agent all reasonably requested information
regarding (1) pollution conditions or potential for pollution conditions on the
new properties or pertaining to the matters relating to Environmental Insurance
Policy and (2) the effects on the protections afforded to the Portfolio Assets
by adding such new properties to the Environmental Insurance Policy or matters
relating to the Environmental Insurance Policy.
Section 6.15 ASH DISPOSAL. Dispose of, or arrange for the disposal of,
any coal combustion waste or untreated ash leachate (i) in any location that
does not comply with the rules, regulations and applicable standards (including
any permitted variances) of the states of Ohio and Pennsylvania as applicable
based upon the location of the facility or (ii) into the Harwick Mine Complex
except pursuant to the Harwick Ash Contract. This prohibition on disposal
includes, without limitation, any disposal of coal combustion wastes in a mine
shaft or other unlined underground borehole (except for the Harwick Mine Complex
as contemplated above), even if such disposal would otherwise be allowable under
applicable Environmental Laws.
Section 6.16 SPECULATIVE TRADING. Engage in any speculative trading
activities.
ARTICLE VII
EVENTS OF DEFAULT
If any of the following specified events (each an "EVENT OF DEFAULT")
shall occur and be continuing:
Section 7.01 PAYMENTS.
(a) The Borrower shall fail to pay in accordance with the terms hereof
(including, without limitation, by mandatory prepayment or acceleration) (i) any
principal of any Loan or reimbursement obligation in respect of any Letter of
Credit when due; (ii) any scheduled or periodic payment of interest or any other
scheduled or periodic amount (including Fees) payable by the Borrower on demand
hereunder or under the other Financing Documents, within three (3) Business Days
after any such amount becomes due in accordance with the terms hereof or of any
other Financing Document or (iii) any other payment, including non-scheduled and
non-periodic payments of the Borrower, and such failure shall continue for ten
(10) Business Days after written notice thereof to the Borrower;
(b) except as set forth in Section 7.02(a)(ii), any Credit Party
(other than the Borrower) shall fail to pay any amount when due under any
Financing Document to which such Credit Party is a party in accordance with the
terms thereof and such failure shall continue for ten (10) Business Days after
written notice thereof to such Credit Party; or
(c) any Borrower Entity shall fail to deposit, in accordance with the
terms hereof or any other Financing Document, the amounts required to be
deposited into the Accounts as and when required by the terms hereof or any
other Financing Document and such failure shall not be remedied within five (5)
Business Days after such Borrower Entity shall have received such amount;
Section 7.02 COVENANTS.
(a) (i) The Borrower shall fail to observe or perform any covenant or
agreement contained in Sections 5.01(a), (b) and (c), 5.06, 5.13, 5.17, 5.22,
5.26(a)(iv), 5.26(b)(vi), 5.26(c)(iii) or 5.27 hereof or in Article VI hereof or
to deliver all items described in Section 5.28 hereof on or before February 15,
2001; (ii) any Credit Party shall fail to observe or perform any covenant or
agreement contained in Section 2(b) of the Equity Contribution Agreement; (iii)
the Borrower shall fail to observe or perform any covenant or agreement
contained in any of the FE Interconnection Agreements or any of the FE Easement
and Attachment Agreements, and such failure shall remain unremedied for one half
(1/2) the number of days provided for cure or grace in any such document; or
(iv) Twelvepole shall fail to observe or perform any covenant or agreement
contained in SECTIONS 7.01(A), (B) AND (C), 7.06, 7.13, 7.16, 7.22 or SECTION 8
of the Twelvepole Guarantee;
(b) Any Credit Party shall fail to observe or perform any covenant or
agreement contained in any Financing Document to which it is a party, other than
those referred to in Sections 7.01 and 7.02(a), and, if capable of being
remedied, such failure shall remain unremedied and material for thirty (30) days
after the earlier of (i) such Credit Party's obtaining actual knowledge thereof
or (ii) written notice thereof shall have been given to such Credit Party by any
Lender or the Administrative Agent; provided, that, such Credit Party shall have
such longer period of time (up to a maximum of an additional 120 days) which may
be necessary to remedy such failure, so long as, (x) such Credit Party commences
such remedy within such thirty (30) day period, (y) such Credit Party is
diligently pursuing such remedy and (z) such Default has not had, and could not
reasonably be expected to have, a Material Adverse Effect;
(c) Any other Major Project Party shall fail to observe or perform any
material covenant or material agreement contained in any Project Contract to
which such Major Project Party is a party, and, if capable of being remedied,
such failure shall remain unremedied and material beyond the applicable grace
period provided therefor in such Project Contract or if no grace period is
provided therefor, for a period of 120 days after written notice thereof;
PROVIDED, HOWEVER, that it shall not be an Event of Default under this Section
7.02(c) if, prior to the date such cure period specified above expires, such
Project Contract shall be replaced by an agreement in form and substance and
with a party reasonably satisfactory to the Required Lenders;
Section 7.03 REPRESENTATIONS. Any representation or warranty made by
any Credit Party in any Financing Document, or any representation, warranty or
statement in any certificate, financial statement or other document furnished to
any Lender by or on behalf of any Credit Party under any Financing Document,
shall prove to have been false or misleading in any material respect as of the
time made, confirmed or furnished and such Credit Party shall fail to correct
such representation or warranty or any material adverse effect therefrom within
30 days after written notice thereof to the Borrower;
Section 7.04 DEFAULTS OF OTHER INDEBTEDNESS.
(a) Any Borrower Entity or either Partner shall fail to observe or
perform any covenant or agreement contained in any material agreement or
instrument relating to any of its Indebtedness in excess of $1,000,000 within
any applicable grace period, or any other event shall occur, if the effect of
such failure or other event is to accelerate the maturity of such Indebtedness
or cause the holder of such Indebtedness to take steps to accelerate such
Indebtedness; or any such Indebtedness shall be required to be prepaid (other
than by a regularly scheduled required prepayment or a refinancing thereof) in
whole or in part prior to its stated maturity or (b) the Sponsor shall fail to
observe or perform any covenant or agreement contained in any agreement or
instrument relating to any of its Indebtedness in excess of $25,000,000 within
any applicable grace period, or any other event shall occur, if the effect of
such failure or other event is to accelerate the maturity of such Indebtedness
or cause the holder of such Indebtedness to take steps to accelerate such
Indebtedness; or any such Indebtedness shall be required to be prepaid (other
than by a regularly scheduled required prepayment or a refinancing thereof) in
whole or in part prior to its stated maturity;
Section 7.05 SECURITY DOCUMENTS. Any of the Security Documents shall,
after the execution and delivery thereof, cease to be in full force and effect,
or shall cease to give the Administrative Agent (for the benefit of the Secured
Parties) the Liens, rights, powers and privileges purported to be created
thereby (including, without limitation, a security interest in, and Lien on, any
of the Collateral covered thereby which is superior to and prior to the rights
of all other Persons, other than with respect to vehicles and boats), in favor
of the Administrative Agent (for the benefit of the Secured Parties) subject to
no other Liens other than Permitted Liens;
Section 7.06 TRANSACTION DOCUMENTS. Any Transaction Document or any
material provision contained in any thereof, shall become invalid, illegal or
unenforceable or shall cease, for any reason not permitted hereby, to be in full
force and effect prior to its stated termination date, or any party thereto
asserts the same in writing, unless such Transaction Document or provision, as
the case may be, is replaced within 120 days of such cessation by an agreement
in form and substance and with a party reasonably satisfactory to the Required
Lenders;
Section 7.07 BANKRUPTCY. Any Credit Party or Major Project Party shall
commence a voluntary case or proceeding concerning itself under any existing or
future law of any jurisdiction, domestic or foreign, relating to bankruptcy,
insolvency, reorganization or relief of debtors; or such an involuntary case or
proceeding is commenced against any Credit Party or Major Project Party and the
petition is not dismissed within 60 days after commencement of the case; or a
custodian, receiver, trustee, conservator or other similar official is appointed
for, or takes charge of, all or any substantial part of the property of any
Credit Party or Major Project Party and such official is not dismissed or
removed within 60 days after such appointment; or any Credit Party or Major
Project Party commences any other proceeding under any reorganization,
arrangement, adjustment of debt, relief of debtors, dissolution, insolvency or
liquidation or similar law of any jurisdiction whether now or hereafter in
effect relating to such Credit Party or Major Project Party, or there is
commenced against any Credit Party or Major Project Party any such proceeding
which remains undismissed for a period of 60 days; or any Credit Party or Major
Project Party is adjudicated insolvent or bankrupt; or any order of relief or
other order approving any such case or proceeding is entered and is undischarged
and unstayed for a period of 60 days; or any Credit Party or Major Project Party
suffers any appointment of any custodian or the like for it or any substantial
part of its property to continue undischarged and unstayed for a period of 60
days; or any Credit Party or Major Project Party makes a general assignment for
the benefit of creditors; or any Credit Party or Major Project Party shall fail
to pay, or shall state that it is unable to pay, or shall be unable to pay, its
debts generally as they become due; or any Credit Party or Major Project Party
shall call a meeting of its creditors with a view to arranging a composition or
adjustment of its debts; or any Credit Party or Major Project Party shall by any
act or failure to act indicate its consent to, approval of or acquiescence in
any of the foregoing; or any corporate action is taken by any Credit Party or
Major Project Party for the purpose of effecting any of the foregoing; provided,
that, the foregoing, as it relates to any Major Project Party, shall not
constitute an Event of Default if the Borrower obtains, within 60 days after
expiration of such 60 day period, a replacement Person reasonably satisfactory
to the Required Lenders to perform the obligations of the affected Major Project
Party on terms and conditions reasonably satisfactory to the Required Lenders;
Section 7.08 GOVERNMENTAL APPROVALS. (a) Any material Governmental
Approval required by any Borrower Entity shall not be obtained, shall be revoked
or cancelled or materially and adversely modified, which modification,
revocation or cancellation is not promptly stayed upon appeal or other legal
challenge instituted by or on behalf of such Borrower Entity by any Governmental
Authority having jurisdiction; or (b) any notice of violation is issued under
any material Governmental Approval or any proceeding is commenced by any
Governmental Authority for the purpose of modifying in any materially adverse
manner, revoking or canceling any such Governmental Approval and any such event
or condition described in this clause (b) shall have a material adverse effect
on any Portfolio Asset and shall continue for a period of one hundred fifty
(150) days without a variance or similar relief being granted with respect
thereto; PROVIDED, THAT, notwithstanding the foregoing, it shall be an Event of
Default (with no cure period except as provided in the following proviso) if any
event or condition described in this clause (b) occurs and any Governmental
Authority commences any enforcement action with respect thereto which has or
could reasonably be expected to have a Material Adverse Effect; and, PROVIDED
FURTHER, that if no Material Adverse Effect has in fact occurred and, within
forty-five (45) days after the commencement of any such enforcement action, such
enforcement action is stayed or otherwise resolved in a manner reasonably
satisfactory to the Required Lenders, then the Borrower shall be entitled to the
full cure period specified above with respect to the occurrence of any such
event or condition described in this clause (b);
Section 7.09 OWNERSHIP. (a) The failure of the Sponsor to own,
directly or indirectly, 100% of the outstanding Capital Stock of the Partners,
the Borrower, and all of their respective Subsidiaries, or (b) (i) at any time
prior to an initial registered public offering pursuant to an effective
registration statement under the Securities Act of 1933 covering the offer and
sale of common stock of the Sponsor to the public (a "SPONSOR IPO"), (A) the
failure of Constellation Enterprises, Inc. ("CEI") or any direct or indirect
parent of CEI to own, directly or indirectly, an amount of the outstanding
Capital Stock of the Sponsor entitled to 20% or more of the Total Voting Power
of the Sponsor, (B) the failure of the Goldman Entities to own, directly or
indirectly, an amount of the outstanding Capital Stock of the Sponsor entitled
to 20% or more of the Total Voting Power of the Sponsor, (C) the occurrence of a
Goldman Disposition (as defined in the CPS Strategic Alliance Agreement) or (D)
the failure of CEI (or any direct or indirect parent of CEI) and the Goldman
Entities (jointly, the "PERMITTED HOLDERS") collectively to own an amount of the
outstanding Capital Stock of the Sponsor entitled to 51% or more of the Total
Voting Power of the Sponsor, or (ii) at any time after successful consummation
of a Sponsor IPO, (A) any person or "group" (within the meaning of Rule 13d-5
under the Securities and Exchange Act of 1934, as amended), together with its
Affiliates, other than the Permitted Holders, shall beneficially own, directly
or indirectly, an amount of Capital Stock of the Sponsor entitled to twenty
percent (20%) or more of the Total Voting Power of the Sponsor; (B) the failure
of the Permitted Holders to own shares of Capital Stock of the Sponsor
representing at least thirty-three and one-third percent (33 1/3%) of the Total
Voting Power of the Sponsor; or (C) the Continuing Directors in office at any
time shall not constitute a majority of the Board of Directors of the Sponsor.
For purposes of the foregoing, the term "Continuing Directors" shall mean, at
any date, an individual (y) who is a member of the Board of Directors of the
Sponsor on the Closing Date, or (z) who has been nominated to fill a vacancy on
the Board of Directors of the Sponsor by a majority of the Continuing Directors
then in office;
Section 7.10 JUDGMENT. A judgment shall be entered (i) for the payment
of money (a) in excess of $1,000,000 against any Borrower Entity or any Partner,
or (b) in excess of $10,000,000 against the Sponsor and such judgment or order
(in the case of a money judgment) shall continue unsatisfied and in effect, or
such party shall fail to provide Acceptable Reserves for the satisfaction
thereof, for a period of 60 days during which execution shall not be effectively
stayed or deferred (whether by action of a court, by agreement or otherwise);
(ii) which could reasonably be expected to cause a Material Adverse Effect; or
(iii) in the form of an injunction or similar form of relief requiring
suspension of operations of any Portfolio Asset (other than Phillips or Ceredo
to the extent not put into service by the Borrower or Twelvepole, as applicable)
on the grounds of violation of an Environmental Law or other Requirement of Law
and failure of the Borrower to have such injunction or similar form of relief
stayed or discharged within 90 days;
Section 7.11 DESTRUCTION OF PORTFOLIO ASSETS. Any of the Portfolio
Assets (other than Phillips or Ceredo to the extent not put into service by the
Borrower or Twelvepole, as applicable) shall suffer a substantial casualty, or
be destroyed, abandoned, irreparably damaged, or requisitioned or taken by
condemnation;
Section 7.12 ERISA. Any Borrower Entity or any ERISA Affiliate shall
fail to pay when due an amount or amounts aggregating in excess of $10,000,000
which it shall have become liable to pay under Title IV of ERISA; or notice of
intent to terminate a Material Plan shall be filed under Title IV of ERISA by
any Borrower Entity or any ERISA Affiliate, any plan administrator or any
combination of the foregoing; or the PBGC shall institute proceedings under
Title IV of ERISA to terminate, to impose liability in respect of, or to cause a
trustee to be appointed to administer any Material Plan; or a condition shall
exist by reason of which the PBGC would be entitled to obtain a decree
adjudicating that any Material Plan must be terminated; or there shall occur a
complete or partial withdrawal from, or a default, within the meaning of Section
4219(c)(5) of ERISA, with respect to, one or more Multiemployer Plans which
could cause any Borrower Entity or one or more ERISA Affiliates to incur a
current payment obligation in excess of $10,000,000;
Section 7.13 REGULATORY STATUS. Any Borrower Entity or any operator of
the Portfolio Assets shall fail at any time to be an "exempt wholesale
generator" under Section 32 of PUHCA;
Section 7.14 NEGATIVE PLEDGE. Any Person pledging an interest pursuant
to any Partnership Interest Pledge Agreement or Stock Pledge Agreement, as the
case may be, shall, or shall agree to, create, incur, assume or suffer to exist
any Lien upon, or with respect to, such pledged interest other than Permitted
Liens;
Section 7.15 ABANDONMENT. Any Borrower Entity shall have voluntarily
abandoned the ownership or operation of any material portion of any of the
Portfolio Assets (other than Phillips or Ceredo to the extent not put into
service by the Borrower or Twelvepole, as applicable) for a continuous period of
seven days other than pursuant to a Requirement of Law;
Section 7.16 SPONSOR INDEBTEDNESS. The Sponsor shall incur
Indebtedness (or any amendment, modification, restructuring, replacement or
refinancing thereof) for borrowed money, (or issue any guarantee or surety of
any Indebtedness for borrowed money) in excess of $5,000,000, other than
Permitted Indebtedness, the Sponsor High Yield Debt and the Sponsor Revolver,
that (i) has a maturity date of less than 36 months and (ii) limits or restricts
the Lenders in exercising their rights and remedies hereunder and under the
other Financing Documents, in any way that is more limiting or restricting than
the provisions of the Sponsor High Yield Debt; or
Section 7.17 CEREDO PROJECT. The failure of Twelvepole to achieve
Commercial Operation with respect to Ceredo on or before July 1, 2001 (unless
there shall have occurred a Closing Failure and the Administrative Agent shall
have applied the amounts on deposit in the Equity Proceeds Account to the
prepayment of the Loans and otherwise as provided in Section 5.3(b) of the
Deposit Account Agreement);
then, and in any such event, and at any time thereafter, if any Event of Default
shall then be continuing, the Administrative Agent may, and upon the written,
telecopied or telex request of the Required Lenders, shall, by written notice to
the Credit Parties (a "REMEDY NOTICE"), take any or all of the following
actions, without prejudice to the rights of the Administrative Agent, any
Secured Party or the holder of any Note to enforce its claims against the
Borrower: (i) declare the Commitments terminated, whereupon the Commitments of
each Lender shall terminate immediately and any accrued but unpaid Commitment
Fee shall forthwith become due and payable without any action of any kind; or
(ii) declare the principal of and any accrued interest on the Loans, and all
other Obligations, to be, whereupon the same shall become, forthwith due and
payable without presentment, demand, protest or other notice of any kind, all of
which are hereby waived; provided that, if any Event of Default specified in
Section 7.07 shall occur, the result which would occur upon the giving of a
Remedy Notice by the Administrative Agent, as specified in clauses (i) and (ii)
above, shall occur automatically without the giving of any such Notice. Except
as expressly provided in the immediately preceding sentence, neither the
Administrative Agent nor any Secured Party shall otherwise be precluded from
pursuing any other right or remedy then available to them against the Borrower
or any Credit Party pursuant to the Financing Documents. Upon the exercise of
any of the foregoing remedies, any excess remaining after payments to each
Secured Party of any and all amounts sufficient to compensate such Secured Party
for all amounts owing and all costs incurred under any Financing Document, shall
be remitted by the Administrative Agent to the Borrower.
ARTICLE VIII
THE AGENTS AND ISSUING BANK
Section 8.01 APPOINTMENT OF AGENTS, POWERS AND IMMUNITIES. Each
Secured Party hereby irrevocably appoints and authorizes each of the Agents and
the Issuing Bank to act as its Agent and the Issuing Bank hereunder and under
the other Transaction Documents with such powers as are expressly delegated to
such Agent and the Issuing Bank by the terms of this Agreement, together with
such other powers as are reasonably incidental thereto. The Agents shall not
have any duties or responsibilities except those expressly set forth in this
Agreement or in any other Transaction Document, or be a trustee for any Secured
Party. Notwithstanding anything to the contrary contained herein, no Agent shall
be required to take any action which is contrary to this Agreement or any other
Transaction Document or applicable law. Neither the Agents, the Issuing Bank nor
any Secured Party nor any of their respective affiliates shall be responsible to
any other Secured Party for any recitals, statements, representations or
warranties made by the Borrower contained in this Agreement or any other
Transaction Document or in any certificate or other document referred to or
provided for in, or received by any Secured Party under, this Agreement or any
other Transaction Document, for the value, validity, effectiveness, genuineness,
enforceability or sufficiency of this Agreement, the Notes, the other
Transaction Documents or any other document referred to or provided for herein
or therein or for any failure by the Borrower to perform its obligations
hereunder or thereunder. Each Agent may employ Agents and attorneys-in-fact and
shall not be responsible for the negligence or misconduct of any such Agents or
attorneys-in-fact selected by it with reasonable care. Neither the Agents, the
Issuing Bank nor any of their respective directors, officers, employees or
agents shall be responsible for any action taken or omitted to be taken by it or
them hereunder or under any other Transaction Document or in connection herewith
or therewith, except for its or their own gross negligence or willful
misconduct.
Section 8.02 RELIANCE BY AGENTS. Each Agent and the Issuing Bank shall
be entitled to rely upon any certificate, notice or other document (including
any cable, telegram, telecopy or telex) believed by it to be genuine and correct
and to have been signed or sent by or on behalf of the proper Person or Persons,
and upon advice and statements of legal counsel, independent accountants and
other experts selected by such Agent or the Issuing Bank. As to any matters
related to this Agreement or the transactions contemplated hereby, none of the
Agents nor the Issuing Bank shall be required to take any action or exercise any
discretion, but the Agents and the Issuing Bank shall be required to act or to
refrain from acting upon instructions of the Required Lenders and shall in all
cases be fully protected in acting, or in refraining from acting, hereunder or
under any other Transaction Document in accordance with the instructions of the
Required Lenders, and such instructions of the Required Lenders and any action
taken or failure to act pursuant thereto shall be binding on all of the Secured
Parties.
Section 8.03 DEFAULTS. The Administrative Agent shall not be deemed to
have actual knowledge or notice of the occurrence of a Default or an Event of
Default unless the Administrative Agent has received notice from a Lender or the
Borrower referring to this Agreement, describing such Default or Event of
Default and stating that such notice is a "Notice of Default". In the event that
the Administrative Agent receives such a notice of the occurrence of a Default
or an Event of Default the Administrative Agent shall give notice thereof to the
Secured Parties. The Administrative Agent shall take such action with respect to
such Default or Event of Default as shall be reasonably directed by the Required
Lenders (or, if required by Section 9.02, as shall be reasonably directed by all
of the Lenders); PROVIDED that, unless and until the Administrative Agent shall
have received such directions, the Administrative Agent may (but shall not be
obligated to) take such action, or refrain from taking such action, with respect
to such Default or Event of Default as it shall deem advisable in the best
interest of the Secured Parties.
Section 8.04 RIGHTS AS LENDERS. With respect to its commitment to make
Loans, Bank of America, N.A. shall have the same rights and powers hereunder as
any Lender and may exercise the same as though it was not acting as the
Administrative Agent and the term "Lender" or "Lenders" shall, unless the
context otherwise indicates, include Bank of America, N.A. in its individual
capacity. Bank of America, N.A. and its Affiliates may (without having to
account therefor to any Lender) accept deposits from, extend credit (on a
secured or unsecured basis) to and generally engage in any kind of banking,
trust or other business with the Borrower or any of its Affiliates, as if it
were not acting as the Administrative Agent.
Section 8.05 INDEMNIFICATION. Without limiting the obligations of the
Borrower under Section 9.04 hereof, each Lender agrees to indemnify each Agent,
the Issuing Bank and the Arrangers, ratably in accordance with the aggregate
principal amount of the Loans and Letter of Credit Exposure held by the Lenders,
or, if no Loans are then outstanding, the respective amounts of the Lenders'
Commitments, for any and all liabilities, obligations, losses, damages,
penalties, actions, judgments, suits, costs, expenses or disbursements or any
kind or nature whatsoever which may at any time (including, without limitation,
at any time following the payment of principal of and/or interest on the Loans)
be imposed on, incurred by or asserted against any Agent, the Issuing Bank or
any Arranger in any way relating to or arising out of this Agreement or any
documents contemplated by or referred to herein or therein or the transactions
contemplated hereby or thereby (including the costs and expenses which the
Borrower is obligated to pay under Section 9.04 hereof) or the enforcement of
any of the terms hereof or thereof or of any such other documents, provided that
no Lender shall be liable for any of the foregoing to the extent they arise from
any Agent's, the Issuing Bank's or any Arranger's gross negligence or willful
misconduct as determined by a court of competent jurisdiction. The Agents, the
Issuing Bank and the Arrangers shall be fully justified in refusing to take or
to continue to take any action hereunder unless it shall first be indemnified to
its satisfaction by the Lenders against any and all liability and expense which
may be incurred by it by reason of taking or continuing to take any such action.
Section 8.06 DOCUMENTS. The Administrative Agent will forward to each
Lender, promptly after the Administrative Agent's receipt thereof, a copy of
each document furnished to the Administrative Agent for such Secured Party
hereunder (and a copy of such other documents furnished to the Administrative
Agent pursuant to Article III hereof as may be requested by such Lender).
Section 8.07 NON-RELIANCE ON AGENTS AND OTHER LENDERS. Each Lender
represents that it has, independently and without reliance on any Agent, the
Issuing Bank, any Arranger, or any other Lender, and based on such documents and
information as it has deemed appropriate, made its own appraisal of the
financial condition and affairs of the Borrower and its own decision to enter
into this Agreement and agrees that it will, independently and without reliance
upon any Agent, the Issuing Bank, 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 appraisals and decisions in taking or not taking action
under this Agreement. None of the Agents, the Issuing Bank, any Arranger or any
Lender shall be required to keep informed as to the performance or observance by
the Borrower under this Agreement or any other document referred to or provided
for herein or to make inquiry of, or to inspect the properties or books of, the
Borrower. Except for notices, reports and other documents and information
expressly required to be furnished to the Lenders by any Agent, the Issuing
Bank, or any Arranger hereunder, none of the Agents, the Issuing Bank, any
Arranger or any Lender shall have any duty or responsibility to provide any
Lender with any credit or other information concerning the Borrower, or any
Affiliate of the Borrower, which may come into the possession of such Agent, the
Issuing Bank, any Arranger or such Lender or any of its or their Affiliates.
Section 8.08 RESIGNATION. Subject to the appointment and acceptance of
a successor as provided below, each of the Agents and the Issuing Bank (prior to
the issuance of the DLC Letter of Credit) may resign at any time by giving
notice thereof to the Lenders and the Borrower. Upon any such resignation, the
Required Lenders shall have the right to appoint a successor Agent and/or
Issuing Bank, as applicable, which shall be a Lender hereunder. If no successor
Agent and/or Issuing Bank, as applicable, shall have been appointed by the
Required Lenders and no Lender shall have accepted such appointment within 30
days after the retiring Agent's and/or Issuing Bank's giving of notice of
resignation, then the retiring Agent may, on behalf of the Lenders, appoint a
successor Agent and/or Issuing Bank, which shall be a Lender hereunder having a
combined capital and surplus of not less than $500,000,000. Upon the acceptance
of any appointment as an Agent and/or Issuing Bank, as applicable, hereunder by
a successor Agent and/or Issuing Bank, as the case may be, such successor Agent
and/or Issuing Bank shall thereupon succeed to and become vested with all the
rights, powers, privileges and duties of the retiring Agent and/or Issuing Bank,
and the retiring Agent and/or Issuing Bank shall be discharged from its duties
and obligations hereunder. After any retiring Agent's and/or Issuing Bank's
resignation hereunder as Agent and/or Issuing Bank, the provisions of this
Article VIII shall continue in effect for its benefit in respect of any actions
taken or omitted to be taken by it while it was acting as Agent and/or Issuing
Bank.
Section 8.09 AUTHORIZATION. The Administrative Agent and the Issuing
Bank are hereby authorized by the Lenders to execute, deliver and perform each
of the Transaction Documents to which they (whether as "Administrative Agent",
"Issuing Bank", "Secured Party", "Grantee" or "Mortgagee") are or are intended
to be a party and each Lender agrees to be bound by all of the agreements of the
Administrative Agent and the Issuing Bank respectively, contained in the
Transaction Documents.
Section 8.10 DOCUMENTATION AGENTS; SYNDICATION AGENTS; JOINT BOOK
RUNNERS, ARRANGERS. Nothing in this Agreement shall create or impose on any
Documentation Agent, Syndication Agent, Joint Book Runner or Arranger, in each
case in such capacity, any duty, obligation or responsibility whatsoever to any
Person.
ARTICLE IX
MISCELLANEOUS
Section 9.01 NOTICES. All notices, requests and other communications
to the Borrower or any Secured Party shall be in writing (including bank wire,
cable, telex, telecopy or similar teletransmission or writing) and shall be
given to such party at its address, or telex, cable or telecopy number set forth
on ANNEX II hereto or such other address or telecopy number as such party may
hereafter specify by notice to the Administrative Agent and the Borrower. Each
such notice, request or other communication shall be effective (i) if given by
telecopy, when such telecopy is transmitted to the telecopy number specified in
Annex II and receipt thereof is confirmed in writing, or (ii) if given by any
other means (including, without limitation, by air courier), when delivered at
the address specified in Annex II.
Section 9.02 AMENDMENTS, ETC.. No amendment or waiver of any provision
of any Financing Document, nor consent to any departure by any Credit Party
therefrom, shall in any event be effective unless the same shall be in writing
and signed by the Required Lenders and the Administrative Agent or Issuing Bank,
as the case may be, or if the Lenders shall not be parties thereto, by the
parties thereto and consented to by the Required Lenders, and each such
amendment, waiver or consent shall be effective only in the specific instance
and for the specific purpose for which given; PROVIDED, THAT, no amendment,
waiver or consent shall, unless in writing and signed by 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 hereunder, (iii) postpone any date fixed for any
scheduled payment in respect of principal of (as set forth in the Deposit
Account Agreement), or interest on, the Notes or any Fees hereunder, (iv) change
the percentage of the Commitments or of the aggregate unpaid principal amount of
the Notes, or the number or identity of the Lenders which shall be required for
the Lenders or any of them to take any action hereunder, (v) postpone the date
fixed for reimbursement of any DLC Letter of Credit Disbursement or any
Operational Letter of Credit Disbursement, (vi) amend or waive Sections 9.02,
9.04 or the definitions of the terms used in such Sections under any Financing
Document insofar as the definitions affect the substance of such Sections, (vii)
consent to the assignment or other transfer by any Credit Party of any of its
rights and obligations under any Financing Document, (viii) release any
Collateral (other than as expressly contemplated under the Financing Documents),
(ix) extend the Revolving Loan Availability Period, or (x) subordinate the Loans
to any other Indebtedness; and PROVIDED, FURTHER, that no amendment, waiver or
consent affecting the rights or duties of the Administrative Agent or the
Issuing Bank under any Financing Document shall in any event be effective,
unless in writing and signed by the Administrative Agent or the Issuing Bank, as
the case may be, in addition to the Lenders required hereinabove to take such
action. Notwithstanding any of the foregoing to the contrary, the consent of the
Borrower shall not be required for any amendment, modification or waiver of the
provisions of Article VIII (other than the provisions of Section 8.08). In
addition, the Borrower, the Arrangers, the Lenders and the Swap Banks hereby
authorize the Administrative Agent to modify this Agreement by amending or
supplementing Annexes I and II from time to time in the manner requested by the
Borrower, the Administrative Agent or any other Secured Party and otherwise in
accordance with the terms of this Agreement; PROVIDED, HOWEVER, that the
Administrative Agent shall promptly deliver a copy of any such modification to
the Borrower and each Secured Party.
Section 9.03 NO WAIVER; REMEDIES CUMULATIVE. No failure or delay on
the part of any Secured Party or any holder of a Note in exercising any right or
remedy under any Financing Document and no course of dealing between the
Borrower and any Secured Party or the holder of any Note shall operate as a
waiver thereof, nor shall any single or partial exercise of any right or remedy
under any Financing Document preclude any other or further exercise thereof or
the exercise of any other right or remedy hereunder. The rights and remedies
herein expressly provided are cumulative and not exclusive of any rights or
remedies which the Secured Parties or the holder of any Note would otherwise
have. No notice to or demand on the Borrower not required under any Financing
Document shall entitle the Borrower to any other or further notice or demand in
similar or other circumstances or constitute a waiver of the rights of any
Secured Party or the holder of any Note to any other or further action in any
circumstances without notice or demand.
Section 9.04 PAYMENT OF EXPENSES AND INDEMNIFICATION. The Borrower
shall:
(i) promptly reimburse each Agent, the Issuing Bank and each
Arranger for all of such Person's reasonable costs and expenses
(including, without limitation, (A) the reasonable fees and
disbursements of legal counsel, (B) reasonable out-of-pocket expenses
of its personnel, (C) other reasonable legal, appraisal,
environmental, audit, consulting, filing fees and expenses and (D) all
reasonable fees, taxes, assessments and duties (to the extent such
taxes, assessments and duties are required to be paid under Article II
of this Agreement)) incurred by it in connection with the due
diligence, negotiation, preparation, review, execution, delivery,
interpretation, administration or syndication of this Agreement and
the Loans made thereunder, the other Transaction Documents and the
transactions contemplated hereby and thereby;
(ii) promptly reimburse each Swap Bank for all reasonable costs
and expenses (including, without limitation, (A) the reasonable fees
and disbursements of legal counsel, (B) reasonable out-of-pocket
expenses of its personnel and (C) all reasonable fees, taxes,
assessments and duties (to the extent such taxes, assessments and
duties are required to be paid under Article II of this Agreement))
reasonably incurred by it in connection with the negotiation,
preparation, review, execution, delivery, administration, collection,
enforcement, termination or unwinding of any Interest Hedge Contract;
(iii) promptly pay all out-of-pocket costs and expenses of the
Secured Parties (both before and after the execution hereof) in
connection with protecting or perfecting the security interest in the
Collateral or in connection with any matters contemplated by or
arising out of this Agreement or any of the Financing Documents,
whether (a) to prepare, negotiate or execute any amendment to,
modification of or extension of this Agreement or any other Financing
Document, (b) to commence, defend, or intervene in any litigation or
to file a petition, complaint, answer, motion or other pleadings
necessary to protect the rights of the Secured Parties under any of
the Financing Documents, (c) to take any other action in or with
respect to any suit or proceeding (bankruptcy or otherwise) necessary
to protect the rights of the Secured Parties under any of the
Financing Documents, (d) to protect, collect, lease, sell, take
possession of, release or liquidate any of the Collateral or (e) to
attempt to enforce any security interest in any of the Collateral, or
to enforce any rights of the Administrative Agent to collect any of
the Obligations, including all reasonable fees and expenses of
attorneys and paralegals (including charges for inside counsel), and,
in the case of enforcement, pay such costs and expenses for any of the
Secured Parties;
(iv) indemnify each Secured Party, its officers, directors,
employees, representatives, agents, affiliates and advisors (each an
"INDEMNIFIED PERSON") from, and hold each of them harmless against,
any and all costs, losses, liabilities, claims, damages or expenses
incurred by any Indemnified Person of any kind or nature whatsoever
(including, without limitation, any such costs, losses, liabilities,
claims, damages or expenses of such Indemnified Person (whether or not
a party) arising out of or by reason of any investigation, litigation
or other proceeding) relating to any actual or proposed use by any
Borrower Entity of any Letter of Credit or the proceeds of any of the
Loans or any Credit Party's entering into and performing of this
Agreement or any of the other Financing Documents and the Transaction
Documents, together with the reasonable fees and disbursements of
attorneys and paralegals (including charges for inside counsel)
incurred in connection with any of the foregoing; PROVIDED that the
Borrower shall have no obligation to an Indemnified Person hereunder
with respect to any of the foregoing to the extent resulting from the
gross negligence or willful misconduct of such Indemnified Person; and
(v) indemnify each Indemnified Person from, and hold each
Indemnified Person harmless against, any and all costs, losses,
liabilities, claims, damages or expenses incurred by any of them
resulting from (x) any past, present or future storage, holding,
existence, release, emission discharge, generation, abatement,
disposition, handling or transportation by, any Borrower Entity, or
their agents, employees and representatives of any Hazardous Materials
or (y) any past, present or future violation of, failure to comply
fully with or requirement to comply with any Environmental Law by any
Borrower Entity, or their agents, employees and representatives, in
each case together with the reasonable fees and disbursements of
attorneys and paralegals (including reasonable charges for inside
counsel) incurred in connection with any of the foregoing; provided,
that the Borrower shall have no obligation to an Indemnified Person
hereunder with respect to any of the foregoing to the extent resulting
from the gross negligence or willful misconduct of such Indemnified
Person.
(b) If and to the extent that the obligations of the Borrower under
this Section 9.04 are unenforceable for any reason, the Borrower hereby agrees
to make the maximum contribution to the payment and satisfaction of such
obligations which is permissible under applicable Requirement of Law. The
Borrower's obligations under this Section 9.04 shall survive any termination of
this Agreement and the payment of the Notes.
Section 9.05 RIGHT OF SETOFF. In addition to and not in limitation of
all rights of offset that any Lender or other holder of a Note may have under
applicable Requirement of Law, each Lender or other holder of a Note shall, upon
the occurrence and during the continuance of any Event of Default and whether or
not such Lender or such holder has made any demand or the Obligations of the
Borrower are matured, have the right to appropriate and apply to the payment of
the Obligations of the Borrower all deposits (general or special, time or
demand, provisional or final) then or thereafter held by and other indebtedness
or property then or thereafter owing by such Lender or other holder, whether or
not related to this Agreement or any transaction hereunder. Any amount received
as a result of the exercise of such rights shall be re-allocated among the
Lenders as set forth in Section 2.13 and the Borrower shall receive prompt
notice thereof from the Administrative Agent; provided, that any failure by the
Administrative Agent to provide such notice shall in no way affect the rights of
any Lender or other holder of a Note under this Section 9.05.
Section 9.06 BENEFIT OF AGREEMENT; ASSIGNMENTS AND PARTICIPATIONS.
(a) This Agreement shall be binding upon and inure to the benefit of
and be enforceable by the respective successors and assigns of the parties
hereto; provided that the Borrower may not assign or transfer any of its
interest hereunder without the prior written consent of the Lenders.
(b) Any Lender may make, carry or transfer Loans at, to or for the
account of, any of its branch offices or the office of an Affiliate of such
Lender except to the extent such transfer would result in increased costs to the
Borrower.
(c) Each Lender may assign (with the consent of the Administrative
Agent, not to be unreasonably withheld, conditioned or delayed, if such proposed
assignment is not to an existing Lender or an Affiliate of an existing Lender,
after consultation with the Borrower) to one or more banks or other entities all
or a portion of its rights and obligations under this Agreement, the Notes and
the Letters of Credit; PROVIDED that no such assignment shall be for less than
$5,000,000 of such Lender's Commitments or Loans, as the case may be. Upon such
execution, delivery and acceptance, from and after the effective date (the
"EFFECTIVE DATE") of such Assignment and Acceptance (x) the assignee thereunder
shall be a party hereto, and, to the extent that rights and obligations
hereunder have been assigned to and assumed by it pursuant to such Assignment
and Acceptance, such assignee shall have the rights and obligations of a Lender
hereunder and (y) the Lender assignor thereunder shall, to the extent that
rights and obligations hereunder have been assigned by it pursuant to such
Assignment and Acceptance, relinquish its rights and be released from its
obligations under this Agreement (and, in the case of an Assignment and
Acceptance covering all or the remaining portion of an assigning Lender's rights
and obligations under this Agreement, such Lender shall cease to be a party
hereto).
(d) By executing and delivering an Assignment and Acceptance, the
assignee thereunder confirms and agrees as follows: (i) other than as provided
in such Assignment and Acceptance, the 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
the execution, legality, validity, enforceability, genuineness, sufficiency or
value of this Agreement, the Notes, the Letters of Credit or any other
instrument or document furnished pursuant hereto, (ii) such assigning Lender
makes no representation or warranty and assumes no responsibility with respect
to the financial condition of the Borrower or any other Credit Party or the
performance or observance by the Borrower or any other Credit Party of any of
its obligations under this Agreement, any other Financing Document or
Transaction Document or any other instrument or document furnished pursuant
hereto or 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 5.10 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 Arrangers, the Agents, the Administrative Agent, the Issuing
Bank, 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, (v) such
assignee appoints and authorizes the Administrative Agent to take such action as
agent on its behalf and to exercise such powers under this Agreement and the
other Financing Documents as are delegated to the Administrative Agent by the
terms hereof, together with such powers as are reasonably incidental thereto and
(vi) such assignee agrees that it will perform in accordance with their terms
all of the obligations which by the terms of this Agreement are required to be
performed by it as a Lender.
(e) The Administrative Agent shall maintain at its address referred to
in Section 9.01 a copy of each Assignment and Acceptance delivered to and
accepted by it and a register for the recordation of the names and addresses of
the Lenders and the Commitments of, and principal amount of the Loans 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 and each Secured Party may treat each Person whose name is recorded in
the Register as a Lender hereunder for all purposes of this Agreement. The
Register and copies of each Assignment and Acceptance shall be available for
inspection by the Borrower, the Issuing Bank or any Lender at any reasonable
time and from time to time upon reasonable prior notice.
(f) Upon its receipt of an Assignment and Acceptance executed by an
assigning Lender, together with the Note or Notes subject to such assignment,
the Administrative Agent shall, if such Assignment and Acceptance has been
completed and is in substantially the form of EXHIBIT K hereto, (i) accept such
Assignment and Acceptance, (ii) record the information contained therein in the
Register and (iii) give prompt notice thereof to the Issuing Bank and the
Borrower. Within five (5) Business Days after its receipt of such notice, the
Borrower shall execute and deliver to the Administrative Agent in exchange for
the surrendered Note or Notes a new Note or Notes to the order of such assignee
in an amount equal to the Commitment or Commitments assumed by it pursuant to
such Assignment and Acceptance and, if the assigning Lender has retained a
Commitment or Commitments hereunder, a new Note or Notes to the order of the
assigning Lender in an amount equal to the Commitment or Commitments retained by
it hereunder. Such new Note or Notes shall re-evidence the indebtedness
outstanding under the old Notes or Notes and 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 the Note or Notes subject to
such assignments.
(g) Each Lender may sell participations (without the consent of the
Administrative Agent, the Issuing Bank, the Borrower or any other Lender) to one
or more parties in or to all or a portion of its rights and obligations under
this Agreement (including, without limitation, all or a portion of its
Commitment, the Loans owing to it and the Note or Notes held by it and the
participations in the Letters of Credit held by it); provided that (i) such
Lender's obligations under this Agreement (including, without limitation, its
Commitment) shall remain unchanged, (ii) such Lender shall remain solely
responsible to other parties hereto for the performance of such obligations,
(iii) such Lender shall remain the holder of any such Note for all purposes of
this Agreement, (iv) the Borrower, the Administrative Agent, the Issuing Bank
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 (v) such Lender shall not transfer, grant, assign or sell any
participation under which the participant shall have rights to approve any
amendment or waiver of this Agreement except to the extent such amendment or
waiver would (A) extend the final maturity date or the date for the payments of
any installment of fees or principal or interest of any Loans in which such
participant is participating, (B) reduce the amount of any installment of
principal of the Loans in which such participant is participating, (C) reduce
the interest rate applicable to the Loans in which such participant is
participating, (D) reduce any fees payable hereunder, or (E) release all or
substantially all of the Collateral.
(h) Each Lender agrees that, without the prior written consent of the
Borrower and the Administrative Agent, it will not make any assignment hereunder
in any manner or under any circumstances that would require registration or
qualification of, or filings in respect of, any Loan, Note or other Obligation
under the securities laws of the United States of America or of any state.
(i) Any Lender may at any time assign all or any portion of its rights
under this Agreement and the other Financing Documents to the Federal Reserve
Bank of the United States; provided, that any payment in respect of such
assigned rights made by the Borrower to the assigning Lender in accordance with
the terms of this Agreement shall satisfy the Borrower's obligations hereunder
in respect of such assigned rights to the extent of such payment. No such
assignment shall release the assignor Lender from its obligations hereunder.
(j) After the completion of the primary and general syndication of the
Loans described herein, each transferor Lender shall pay the Administrative
Agent a fee of $2,000 in the case of an assignment to an existing Lender or an
Affiliate of an existing Lender or $3,500.00 in all other cases, for processing
each assignment made pursuant to this Section 9.06.
Section 9.07 GOVERNING LAW; SUBMISSION TO JURISDICTION; WAIVER OF JURY
TRIAL; WAIVER OF DAMAGES.
(a) THIS AGREEMENT SHALL BE GOVERNED BY AND INTERPRETED IN ACCORDANCE
WITH THE LAWS OF THE STATE OF NEW YORK OTHER THAN ANY SUCH REQUIREMENT OF LAWS
THAT WOULD APPLY THE LAWS OF ANOTHER JURISDICTION, EXCEPT TO THE EXTENT THAT THE
LAWS OF ANOTHER JURISDICTION ARE MANDATORILY APPLICABLE. ANY DISPUTE ARISING OUT
OF, CONNECTED WITH, RELATED TO, OR INCIDENTAL TO THE RELATIONSHIP ESTABLISHED
BETWEEN THE BORROWER AND EACH SECURED PARTY IN CONNECTION WITH THIS AGREEMENT
AND THE OTHER FINANCING DOCUMENTS, AND WHETHER ARISING IN CONTRACT, TORT, EQUITY
OR OTHERWISE, SHALL BE RESOLVED IN ACCORDANCE WITH THE INTERNAL LAWS (AS OPPOSED
TO THE CONFLICTS OF LAWS PROVISIONS) AND DECISIONS OF THE STATE OF NEW YORK.
(b) EXCEPT AS PROVIDED IN THE NEXT PARAGRAPH, THE BORROWER AND EACH
SECURED PARTY AGREE THAT ALL DISPUTES BETWEEN THEM ARISING OUT OF, CONNECTED
WITH, RELATED TO, OR INCIDENTAL TO THE RELATIONSHIP ESTABLISHED BETWEEN THEM IN
CONNECTION WITH THIS AGREEMENT AND THE OTHER FINANCING DOCUMENTS, AND WHETHER
ARISING IN CONTRACT, TORT, EQUITY, OR OTHERWISE, SHALL BE RESOLVED ONLY BY STATE
OR FEDERAL COURTS LOCATED IN NEW YORK, NEW YORK, BUT THE BORROWER AND EACH
SECURED PARTY ACKNOWLEDGE THAT ANY APPEALS FROM THOSE COURTS MAY HAVE TO BE
HEARD BY A COURT LOCATED OUTSIDE OF NEW YORK, NEW YORK. THE BORROWER WAIVES IN
ALL DISPUTES ANY OBJECTION THAT IT MAY HAVE TO THE LOCATION OF THE COURT
CONSIDERING THE DISPUTE INCLUDING, WITHOUT LIMITATION, ANY OBJECTION TO THE
LAYING OF VENUE OR BASED ON THE GROUNDS OF FORUM NON CONVENIENS.
(c) THE BORROWER AGREES THAT ANY SECURED PARTY SHALL HAVE THE RIGHT,
TO THE EXTENT PERMITTED BY APPLICABLE REQUIREMENT OF LAW, TO PROCEED AGAINST THE
BORROWER OR ITS PROPERTY IN A COURT IN ANY LOCATION REASONABLY SELECTED IN GOOD
FAITH TO ENABLE ANY SECURED PARTY TO REALIZE ON SUCH PROPERTY, OR TO ENFORCE A
JUDGMENT OR OTHER COURT ORDER ENTERED IN FAVOR OF ANY SECURED PARTY. THE
BORROWER WAIVES ANY OBJECTION THAT IT MAY HAVE TO THE LOCATION OF THE COURT IN
WHICH ANY SECURED PARTY HAS COMMENCED A PROCEEDING DESCRIBED IN THIS PARAGRAPH
INCLUDING, WITHOUT LIMITATION, ANY OBJECTION TO THE LAYING OF VENUE OR BASED ON
THE GROUNDS OF FORUM NON CONVENIENS.
(d) THE BORROWER AND THE SECURED PARTIES EACH WAIVE ANY RIGHT TO HAVE
A JURY PARTICIPATE IN RESOLVING ANY DISPUTE, WHETHER SOUNDING IN CONTRACT, TORT,
OR OTHERWISE ARISING OUT OF, CONNECTED WITH, RELATED TO OR INCIDENTAL TO THE
RELATIONSHIP ESTABLISHED BETWEEN THEM IN CONNECTION WITH THIS AGREEMENT AND THE
OTHER FINANCING DOCUMENTS. INSTEAD, ANY DISPUTES RESOLVED IN COURT WILL BE
RESOLVED IN A BENCH TRIAL WITHOUT A JURY.
(e) THE BORROWER HEREBY IRREVOCABLY DESIGNATES NATIONAL REGISTERED
AGENTS, INC., WITH AN ADDRESS AT 440 9TH AVENUE, 5TH FLOOR, NEW YORK, NY 10001
AS THE DESIGNEE, APPOINTEE AND AGENT OF THE BORROWER TO RECEIVE, FOR AND ON
BEHALF OF THE BORROWER, SERVICE OF PROCESS IN SUCH RESPECTIVE JURISDICTIONS IN
ANY LEGAL ACTION OR PROCEEDING WITH RESPECT TO THIS AGREEMENT OR THE NOTES, THE
OTHER FINANCING DOCUMENTS OR ANY DOCUMENTS RELATED THERETO. IT IS UNDERSTOOD
THAT A COPY OF SUCH PROCESS SERVED ON SUCH AGENT WILL BE PROMPTLY FORWARDED BY
MAIL TO THE BORROWER AT ITS ADDRESS SET FORTH IN ANNEX II HERETO IN ACCORDANCE
WITH SECTION 9.01. THE BORROWER FURTHER IRREVOCABLY CONSENTS TO THE SERVICE OF
PROCESS OF ANY OF THE AFOREMENTIONED COURTS IN ANY SUCH ACTION OR PROCEEDING BY
THE MAILING OF COPIES THEREOF BY REGISTERED OR CERTIFIED MAIL, POSTAGE PREPAID,
TO THE BORROWER AT ITS SAID ADDRESS, SUCH SERVICE TO BECOME EFFECTIVE ON THE
DATE OF RECEIPT THEREOF.
(f) NOTHING HEREIN SHALL AFFECT THE RIGHT OF ANY PARTY HERETO OR ANY
HOLDER OF A NOTE TO SERVE PROCESS IN ANY OTHER MANNER PERMITTED BY LAW OR TO
COMMENCE LEGAL PROCEEDINGS OR OTHERWISE PROCEED AGAINST ANY PARTY IN ANY OTHER
JURISDICTION.
Section 9.08 NONLIABILITY OF ADMINISTRATIVE AGENT AND LENDERS. The
relationship between the Borrower and the Secured Parties shall be solely that
of borrower and lender. No Secured Party shall have any fiduciary
responsibilities to the Borrower. No Secured Party undertakes any responsibility
to the Borrower to review or inform the Borrower of any matter in connection
with any phase of the Borrower's business or operations.
Section 9.09 MARSHALLING; RECAPTURE. No Secured Party shall be under
any obligation to marshal any assets in favor of the Borrower or any other party
or against or in payment of any or all of the Obligations. To the extent any
Secured Party receives any payment by or on behalf of the Borrower, which
payment or any part thereof is subsequently invalidated, declared to be
fraudulent or preferential, set aside or required to be repaid to the Borrower
or its estate, trustee, receiver, custodian or any other party under any
bankruptcy law, state or federal law, common law or equitable cause, then to the
extent of such payment or repayment, the obligation or part thereof which has
been paid, reduced or satisfied by the amount so repaid shall be reinstated by
the amount so repaid and shall be included within the liabilities of the
Borrower to such Secured Party as of the date such initial payment, reduction or
satisfaction occurred.
Section 9.10 INDEPENDENT NATURE OF LENDERS' RIGHTS. The amounts
payable at any time hereunder to each Lender shall be a separate and independent
debt, and, except as otherwise provided in any Financing Document, each Lender
shall be entitled to protect and enforce its rights arising our of this
Agreement, and it shall not be necessary for any other Lender to be joined as an
additional party in any proceeding for such purpose.
Section 9.11 COUNTERPARTS. This Agreement may be executed in any
number of counterparts and by the different parties hereto in separate
counterparts, each of which when so executed and delivered shall be an original,
but all of which shall together constitute one and the same instrument.
Section 9.12 EFFECTIVENESS. This Agreement shall become effective as
of the date hereof; PROVIDED, THAT, all of the parties hereto shall have signed
a copy hereof (whether the same or different copies) and shall have delivered
the same to the Administrative Agent pursuant to Section 9.01 or, in the case of
the Lenders, shall have given to the Administrative Agent written, telecopied or
telex notice (actually received) at such office that the same has been signed
and mailed to it.
Section 9.13 SURVIVAL OF INDEMNITIES AND REPRESENTATIONS AND
WARRANTIES. All indemnities set forth herein and all representations and
warranties made herein and in any document, certificate or statement delivered
pursuant hereto or in connection herewith shall survive the execution and
delivery of this Agreement, the Notes, the Letters of Credit and the other
Financing Documents and the making and repayment of the Loans and the expiration
or cancellation of all Letters of Credit.
Section 9.14 SEVERABILITY. In case any provision in or obligation
under this Agreement or the Notes or the other Financing Documents shall be
invalid, illegal or unenforceable in any jurisdiction, the validity, legality
and enforceability of the remaining provisions or obligations, or of such
provision or obligation in any other jurisdiction, shall not in any way be
affected or impaired thereby.
Section 9.15 HEADINGS DESCRIPTIVE. The headings of the several
sections and subsections of this Agreement, and the Table of Contents, are
inserted for convenience only and shall not in any way affect the meaning or
construction of any provision of this Agreement.
Section 9.16 LIMITATION OF RECOURSE. The obligations of the Borrower
hereunder and under the other Financing Documents are obligations solely of the
Borrower and shall not constitute a debt or obligation of any direct or indirect
partner or shareholder of the Borrower or any of their respective directors,
officers, agents or employees (each such Person, a "NON-RECOURSE PARTY"). No
Non-Recourse Party shall be liable for any amount payable by the Borrower under
this Agreement or the other Financing Documents, and the Secured Parties shall
not seek a money judgment or deficiency or personal judgment against any
Non-Recourse Party for payment of the indebtedness payable by the Borrower
evidenced by this Agreement or the other Financing Documents. No property or
assets of any Non-Recourse Party, other than as provided in the Financing
Documents, shall be sold, levied upon or otherwise used to satisfy any judgment
rendered in connection with any action brought against the Borrower with respect
to this Agreement or the other Financing Documents. The foregoing
acknowledgments, agreements and waivers shall be enforceable by any Non-Recourse
Party. Notwithstanding the foregoing, nothing in this Section shall limit or
affect or be construed to limit or affect the obligations and liabilities of any
Credit Party or any other Non-Recourse Party (a) in accordance with the terms of
any Transaction Document or Financing Document creating such liabilities and
obligations to which such Credit Party or Non-Recourse Party is a party, (b)
arising from liability pursuant to applicable Requirements of Law for such
Credit Party's or such Non-Recourse Party's fraudulent actions, knowing
misrepresentations or willful misconduct or (c) with respect to amounts
distributed to it in violation of Section 6.10 hereof.
Section 9.17 CONFIDENTIALITY. Each party hereto will treat as
confidential the data and information in their possession regarding the
Portfolio Assets, the Transaction Documents and each other party hereto
(including any Affiliate of such other party), unless such data or information
(i) was disclosed to the receiving party without violating a confidentiality
obligation, (ii) was in the public domain, or (iii) is required to be disclosed
by law. In addition, each party may disclose confidential information to its
Affiliates or its technical, financial and legal advisors on a need-to-know
basis, provided such party agrees that it will not disclose such information to
third parties, or in accordance with governmental, administrative or judicial
requirements to which such party is subject.
[Remainder of page intentionally left blank.]
IN WITNESS WHEREOF, the parties hereto have caused their duly authorized
officers to execute and deliver this Agreement as of the date first above
written.
BORROWER:
ORION POWER MIDWEST, L.P.,
a Delaware limited partnership
By: Orion Power MidWest GP, Inc., its
general partner
By: /s/
------------------------------
Name:
Title:
CO-LEAD ARRANGERS:
BANC OF AMERICA SECURITIES LLC
By: /s/
------------------------------
Name:
Title:
GOLDMAN SACHS CREDIT PARTNERS L.P.
By: /s/
------------------------------
Name:
Authorized Signatory
ARRANGERS:
BNP PARIBAS
By: /s/
------------------------------
Name:
Title:
By: /s/
------------------------------
Name:
Title:
DEUTSCHE BANK SECURITIES INC.
By: /s/
------------------------------
Name:
Title:
By: /s/
------------------------------
Name:
Title:
ISSUING BANK:
BANK OF AMERICA, N.A.,
as Issuing Bank
By: /s/
------------------------------
Name:
Title:
ADMINISTRATIVE AGENT:
BANK OF AMERICA, N.A.,
as Administrative Agent
By: /s/
------------------------------
Name:
Title:
SYNDICATION AGENTS:
GOLDMAN SACHS CREDIT PARTNERS L.P.
By: /s/
------------------------------
Name:
Authorized Signatory
BNP PARIBAS
By: /s/
------------------------------
Name:
Title:
By: /s/
------------------------------
Name:
Title:
DEUTSCHE BANK AG NEW YORK BRANCH
By: /s/
------------------------------
Name:
Title:
By: /s/
------------------------------
Name:
Title:
DOCUMENTATION AGENTS:
BNP PARIBAS
By: /s/
------------------------------
Name:
Title:
By: /s/
------------------------------
Name:
Title:
DEUTSCHE BANK AG NEW YORK BRANCH
By: /s/
------------------------------
Name:
Title:
By: /s/
------------------------------
Name:
Title:
LENDERS:
BANK OF AMERICA, N.A., as Revolving
Lender and an Acquisition Lender
By: /s/
------------------------------
Name:
Title:
GOLDMAN SACHS CREDIT PARTNERS L.P.,
as a Revolving Lender and an
Acquisition Lender
By: /s/
------------------------------
Name:
Title:
BNP PARIBAS, as a Revolving Lender
and an Acquisition Lender
By: /s/
------------------------------
Name:
Title:
By: /s/
------------------------------
Name:
Title:
DEUTSCHE BANK AG NEW YORK AND/OR
CAYMAN ISLAND BRANCH, as a Revolving
Lender and an Acquisition Lender
By: /s/
------------------------------
Name:
Title:
By: /s/
------------------------------
Name:
Title:
THE BANK OF NOVA SCOTIA, as a
Revolving Lender and an Acquisition
Lender
By: /s/
------------------------------
Name:
Title:
BAYERISCHE HYPO- UND VEREINSBANK
AG, NEW YORK BRANCH, as a Revolving
Lender and an Acquisition Lender
By: /s/
------------------------------
Name:
Title:
By: /s/
------------------------------
Name:
Title:
DEXIA- CREDIT LOCAL DE FRANCE, as a
Revolving Lender and an
Acquisition Lender
By: /s/
------------------------------
Name:
Title:
By: /s/
------------------------------
Name:
Title:
DG BANK DEUTSCHE
GENOSSENSHAFTSBANK AG, as a
Revolving Lender and an Acquisition
Lender
By: /s/
------------------------------
Name:
Title:
By: /s/
------------------------------
Name:
Title:
DRESDNER BANK AG, NEW YORK AND
GRAND CAYMAN BRANCHES, as a
Revolving Lender and an Acquisition
Lender
By: /s/
------------------------------
Name:
Title:
By: /s/
------------------------------
Name:
Title:
ING (U.S.) CAPITAL LLC, as a
Revolving Lender and an Acquisition
Lender
By: /s/
------------------------------
Name:
Title:
By: /s/
------------------------------
Name:
Title:
SOCIETE GENERALE, as a Revolving
Lender and an Acquisition Lender
By: /s/
------------------------------
Name:
Title:
UNION BANK OF CALIFORNIA, N.A., as
a Revolving Lender and an
Acquisition Lender
By: /s/
------------------------------
Name:
Title:
ABN AMRO BANK N.V., as a Revolving
Lender and an Acquisition Lender
By: /s/
------------------------------
Name:
Title:
By: /s/
------------------------------
Name:
Title:
COBANK, ACB, as a Revolving Lender
and an Acquisition Lender
By: /s/
------------------------------
Name:
Title:
CREDIT LYONNAIS NEW YORK BRANCH, as
a Revolving Lender and an
Acquisition Lender
By: /s/
------------------------------
Name:
Title:
THE DAI-ICHI KANGYO BANK, LIMITED,
as a Revolving Lender and an
Acquisition Lender
By: /s/
------------------------------
Name:
Title:
FLEET NATIONAL BANK, as a Revolving
Lender and an Acquisition Lender
By: /s/
------------------------------
Name:
Title:
THE FUJI BANK, LIMITED, as a
Revolving Lender and an Acquisition
Lender
By: /s/
------------------------------
Name:
Title:
NORDDEUTSCHE LANDESBANK
GIROZENTRALE, NEW YORK/GRAND CAYMAN
ISLANDS BRANCH, as a Revolving
Lender and an Acquisition Lender
By: /s/
------------------------------
Name:
Title:
By: /s/
------------------------------
Name:
Title:
THE ROYAL BANK OF SCOTLAND PLC, as
a Revolving Lender and an
Acquisition Lender
By: /s/
------------------------------
Name:
Title:
ABBEY NATIONAL TREASURY SERVICES
PLC, as an Acquisition Lender
By: /s/
------------------------------
Name:
Title:
BANK ONE, NA, as an Acquisition
Lender
By: /s/
------------------------------
Name:
Title:
BARCLAYS BANK PLC, as an Acquisition
Lender
By: /s/
------------------------------
Name:
Title:
LLOYDS TSB BANK PLC, as an
Acquisition Lender
By: /s/
------------------------------
Name:
Title:
By: /s/
------------------------------
Name:
Title:
THE GOVERNOR AND COMPANY OF THE BANK
OF SCOTLAND, as an Acquisition
Lender
By: /s/
------------------------------
Name:
Title:
THE SUMITOMO BANK, LIMITED, as an
Acquisition Lender
By: /s/
------------------------------
Name:
Title:
AIB CAPITAL MARKETS PLC, as an
Acquisition Lender
By: /s/
------------------------------
Name:
Title:
BANCA NAZIONALE DEL LAVORO S.P.A.,
NEW YORK BRANCH, as an Acquisition
Lender
By: /s/
------------------------------
Name:
Title:
By: /s/
------------------------------
Name:
Title:
CREDIT INDUSTRIEL ET COMMERCIAL, as
an Acquisition Lender
By: /s/
------------------------------
Name:
Title:
THE INDUSTRIAL BANK OF JAPAN,
LIMITED, as an Acquisition Lender
By: /s/
------------------------------
Name:
Title:
LANDESBANK SCHLESWIG-HOLSTEIN
GIROZENTRALE, as an Acquisition
Lender
By: /s/
------------------------------
Name:
Title:
By: /s/
------------------------------
Name:
Title:
NATIONAL CITY BANK OF PENNSYLVANIA,
as an Acquisition Lender
By: /s/
------------------------------
Name:
Title:
THE GOVERNOR AND COMPANY OF THE BANK
OF IRELAND, as an Acquisition
Lender
By: /s/
------------------------------
Name:
Title:
By: /s/
------------------------------
Name:
Title:
THE SAKURA BANK, LTD, as an
Acquisition Lender
By: /s/
------------------------------
Name:
Title:
ERSTE BANK DER OESTERREICHISCHEN
SPARKASSEN AG, as an Acquisition
Lender
By: /s/
------------------------------
Name:
Title:
BANK AUSTRIA CREDITANSTALT CORPORATE
FINANCE, INC., as an Acquisition
Lender
By: /s/
------------------------------
Name:
Title:
By: /s/
------------------------------
Name:
Title:
THE SANWA BANK LIMITED, NEW YORK
BRANCH, as an Acquisition Lender
By: /s/
------------------------------
Name:
Title:
COOPERATIEVE CENTRALE RAIFFEISEN-
BOERENLEENBANK B.A., as an
Acquistition Lender
By: /s/
------------------------------
Name:
Title:
ANNEX I
COMMITMENTS
as of December 15, 2000
ACQUISITION LOAN
ACQUISITION
LENDER LOAN AMOUNT PRO RATA SHARE
------ ------------ ---------------
Bank of America, N.A. $39,850,000 3.590090090%
Goldman Sachs Credit Partners, L.P. $39,850,000 3.590090090%
Deutsche Bank AG New York and/or Cayman Island Branch $39,850,000 3.590090090%
BNP Paribas $39,850,000 3.590090090%
The Bank of Nova Scotia $38,100,000 3.432432432%
Bayerische Hypo-Und Vereinsbank AG, New York $38,100,000 3.432432432%
Branch
Dexia-Credit Local de France $38,100,000 3.432432432%
DG Bank Deutsche Genossenshaftsbank AG $38,100,000 3.432432432%
Dresdner Bank AG, New York and Grand Cayman $23,100,000 2.081081081%
Branches
ING (U.S.) Capital LLC $38,100,000 3.432432432%
Societe Generale $38,100,000 3.432432432%
Union Bank of California, N.A. $38,100,000 3.432432432%
ABN Amro Bank N.V. $28,850,000 2.599099099%
CoBank, ACB $28,850,000 2.599099099%
Credit Lyonnais New York Branch $28,850,000 2.599099099%
The Dai-Ichi Kangyo Bank, Limited $28,850,000 2.599099099%
Fleet National Bank $28,850,000 2.599099099%
The Fuji Bank, Limited $28,850,000 2.599099099%
NordDeutsche Landesbank Girozentrale, New York/Grand $28,850,000 2.599099099%
Cayman Islands Branch
The Royal Bank of Scotland Plc $28,850,000 2.599099099%
Abbey National Treasury Services plc $30,000,000 2.702702703%
Bank One, NA $30,000,000 2.702702703%
Barclays Bank PLC $30,000,000 2.702702703%
Lloyds TSB Bank plc $30,000,000 2.702702703%
The Governor and Company of the Bank of Scotland $30,000,000 2.702702703%
The Sumitomo Bank, Limited $30,000,000 2.702702703%
The Sanwa Bank Limited, New York Branch $30,000,000 2.702702703%
Cooperatieve Centrale Raiffeisen-Boerenleenbank b.a. $30,000,000 2.702702703%
AIB Capital Markets $20,000,000 1.801801802%
Banca Nazionale del Lavoro $20,000,000 1.801801802%
Credit Industriel et Commercial $20,000,000 1.801801802%
Industrial Bank of Japan, Limited $20,000,000 1.801801802%
Landesbank Schleswig Holstein $20,000,000 1.801801802%
National City Bank of Pennsylvania $20,000,000 1.801801802%
The Governor and Company of the Bank of Ireland $20,000,000 1.801801802%
The Sakura Bank, Limited $20,000,000 1.801801802%
Bank Austria Creditanstalt Corporate Finance, Inc. $15,000,000 1.351351351%
Erste Bank - Der Oesterreichischen Sparkassen AG, New $15,000,000 1.351351351%
York Branch
Total Underwriting ============== ==============
$1,110,000,000 100.000000000%
REVOLVING LOAN
REVOLVING
LENDER LOAN COMMITMENT PRO RATA SHARE
------ --------------- ---------------
Bank of America, N.A. $5,400,000 6.000000000%
Goldman Sachs Credit Partners, L.P. $5,400,000 6.000000000%
Deutsche Bank AG New York and/or Cayman Island Branch $5,400,000 6.000000000%
BNP Paribas $5,400,000 6.000000000%
The Bank of Nova Scotia $4,650,000 5.166666667%
Bayerische Hypo-Und Vereinsbank AG, New York $4,650,000 5.166666667%
Branch
Dexia-Credit Local de France $4,650,000 5.166666667%
DG Bank Deutsche Genossenshaftsbank AG $4,650,000 5.166666667%
Dresdner Bank AG, New York and Grand Cayman $4,650,000 5.166666667%
Branches
ING (U.S.) Capital LLC $4,650,000 5.166666667%
Societe Generale $4,650,000 5.166666667%
Union Bank of California, N.A. $4,650,000 5.166666667%
ABN Amro Bank N.V. $3,900,000 4.333333333%
CoBank, ACB $3,900,000 4.333333333%
Credit Lyonnais New York Branch $3,900,000 4.333333333%
The Dai-Ichi Kangyo Bank, Limited $3,900,000 4.333333333%
Fleet National Bank $3,900,000 4.333333333%
The Fuji Bank, Limited $3,900,000 4.333333333%
NordDeutsche Landesbank Girozentrale, New York/Grand $3,900,000 4.333333333%
Cayman Islands Branch
The Royal Bank of Scotland Plc $3,900,000 4.333333333%
Total Underwriting ========= =============
$90,000,000 100.000000000%
The Borrower acknowledges and agrees that this Annex I may be modified from time
to time.
ANNEX II
NOTICE PROVISIONS
as of December 15, 2000
BORROWER
Orion Power MidWest, L.P.
2000 Cliff Mine Road, Suite 200
Pittsburgh, PA 15275
Telecopy: (412) 809-1699
Telephone: (412) 809-9354
Attention: Controller
with a copy to:
Orion Power Holdings, Inc.
7 East Redwood Street
10th Floor
Baltimore, MD 21202
Attn: Chief Legal Officer
ARRANGERS
Banc of America Securities LLC
Bank of America Corporate Center
100 North Tryon Street
NC1-007-12-05
Charlotte, NC 28255
Telecopy: (704) 386-3324
Telephone: (704) 388-6833
Attention: Laura Ryan
Goldman Sachs Credit Partners L.P.
85 Broad Street
New York, NY 10004
Telecopy: (212) 902-7260
Telephone: (212) 357-4597
Attention: Stephen King
BNP Paribas
787 Seventh Avenue
New York, NY 10019
Telecopy: (212) 841-2052
Telephone: (212) 841-2156
Attention: Project Finance Department/Leonardo Osorio
Deutsche Bank AG New York Branch and/or Cayman Island Branch
31 West 52nd Street, 14th Floor
New York, NY 10019
Telecopy: (212) 469-8256
Telephone: (212) 469-7156
Attention: Amy Walter
ISSUING BANK
Bank of America, N.A.
333 South Beaudry Avenue, 19th Floor
Mail Code CA9-703-19-23
Los Angeles, CA 90017
Telecopy: (213) 345-6694
Telephone: (213) 345-5231
Attention: Standby Letter of Credit Department
ADMINISTRATIVE AGENT
Bank of America, N.A.
Bank of America Corporate Center
100 North Tryon Street
NC1-007-12-05
Charlotte, NC 28255
Telecopy: (704) 386-3324
Telephone: (704) 388-6833
Attention: Laura Ryan
LENDERS
Bank of America, N.A.
Bank of America Corporate Center
100 North Tryon Street
NC1-007-12-05
Charlotte, NC 28255
Telecopy: (704) 386-3324
Telephone: (704) 388-6833
Attention: Laura Ryan
Goldman Sachs Credit Partners L.P.
85 Broad Street, 6th Floor
New York, NY 10004
Telecopy: (212) 357-4597
Telephone: (212) 902-2192
Attention: Jason Savarese
Deutsche Bank AG New York Branch and/or Cayman Island Branch
31 West 52nd Street, 14th Floor
New York, NY 10019
Telecopy: (212) 469-8634
Telephone: (212) 469-2766
Attention: Lisa Cintron
BNP Paribas
787 7th Avenue
New York, NY 10019
Telecopy: (212) 841-2052
Telephone: (212) 841-2156
Attention: Leonardo Osorio
The Bank of Nova Scotia
New York Agency
One Liberty Plaza - 26th Floor
New York, NY 10006
Telecopy: (212) 225-5090
Telephone: (212) 225-5017
Attention: Meredith Wedeking
Bayerische Hypo- und Vereinsbank AG, New York Branch
150 East 42nd Street
New York, NY 10017
Telecopy: (212) 672-5516
Telephone: (212) 672-5646
Attention: Gisela Kroess
Dexia- Credit Local de France
445 Park Avenue
New York, NY 10022
Telecopy: (212) 515-7071
Telephone: (212) 515-7014
Attention: Andrew Brave
DG Bank Deutsche Genossenshaftsbank AG
New York Branch
609 Fifth Avenue
New York, NY 10017
Telecopy: (212) 745-1552
Telephone: (212) 745-1545
Attention: Daria A. Pishko
Dresdner Bank AG, New York and Grand Cayman Branches
75 Wall Street
New York, NY 10005
Telecopy: (212) 429-2192
Telephone: (212) 429-2224
Attention: Michael Higgins
ING (U.S.) Capital LLC
55 East 52nd Street
New York, NY 10055
Telecopy: (212) 486-4636
Telephone: (212) 409-1417
Attention: Jacqueline Bove
Societe Generale
1221 Avenue of the Americas - 11th Floor
New York, NY 10020
Telecopy: (212) 278-6144
Telephone: (212) 278-6149
Attention: Beth West
Union Bank of California, N.A.
Energy Capital Services
445 S. Figueroa Street, 15th Floor
Los Angeles, CA 90071
Telecopy: (213) 236-4096
Telephone: (213) 236-5023
Attention: David M. Musicant
ABN AMRO Bank N.V.
135 South LaSalle Street, Suite 710
Chicago, IL 60603
Telecopy: (312) 904-6387
Telephone: (312) 904-2799
Attention: David Bryant
CoBank, ACB
5500 South Quebec Street
Englewood, CO 80111
Telecopy: (303) 224-2615
Telephone: (303) 740-4037
Attention: Todd Telesz
Credit Lyonnais New York Branch
1301 Avenue of the Americas
New York, NY 10019
Telecopy: (212) 261-3421
Telephone: (212) 261-7525
Attention: Sophie Loiodice
The Dai-Ichi Kangyo Bank, Ltd.
One World Trade Center, Suite 4911
New York, NY 10048
Telecopy: (212) 466-3348
Telephone: (212) 432-8436
Attention: Antonio Rocha
Fleet National Bank
100 Federal Street
MA DE 10008D
Boston, MA 02110
Telecopy: (617) 434-3652
Telephone: (617) 434-9579
Attention: Jill Calabrese
The Fuji Bank, Limited
2 World Trade Center
New York, NY 10048
Telecopy: (212) 488-2172
Telephone: (212) 898-2635
Attention: Rosa Martinez-Bynon
NordDeutsche Landesbank Girozentrale, New York/Cayman Islands Branch
1114 Avenue of the Americas, 37th Floor
New York, NY 10036
Telecopy: (212) 812-6860
Telephone: (212) 812-6808
Attention: Bruno Mejean
The Royal Bank of Scotland plc
Wall Street Plaza
88 Pine Street
New York, NY 10005
Telcopy: (212) 480-0791
Telephone: (212) 269-1700, x213
Attention: Siobhan Smyth
Abbey National Treasury Services plc
26-28 Dorset Square
London NW1 6QG
United Kingdom
Telecopy: 44-207-487-0543
Telephone: 44-207-612-3346
Attention: Chris Bassindale
Bank One, NA
1 Bank One Plaza, Suite 0363
Chicago, IL 60670
Telecopy: (312) 732-3055
Telephone: (312) 732-7579
Attention: Mary Lu Cramer
Barclays Bank PLC
222 Broadway, 8th Floor
New York, NY 10038
Telecopy: (212) 412-6709
Telephone: (212) 412-2470
Attention: Sydney Dennis
Lloyds TSB Bank plc
575 Fifth Avenue, 17th Floor
New York, NY 10017
Telecopy: (212) 930-5098
Telephone: (212) 930-8904
Attention: Paul Briamonte
Bank of Scotland
565 Fifth Avenue
New York, NY 10017
Telecopy: (212) 682-5720
Telephone: (212) 450-0831
Attention: Richard Burge
The Sumitomo Bank, Limited
277 Park Avenue
New York, NY 10172
Telecopy: (212) 224-4880
Telephone: (212) 224-4036
Attention: Elaine Calderon
AIB Capital Markets plc
AIB Special Finance Unit
AIB Trade Centre
I.F.S.C., Dublin 1, Ireland
Telecopy: 353-1-829-0269
Telephone: 353-1-641-7460
Attention: Conor Geary
Banca Nazionale del Lavoro S.p.A.
25 West 51st Street
New York, NY 10019
Telecopy: (212) 765-2978
Telephone: (212) 314-0263
Attention: Frederic W. Hall
Credit Industriel et Commercial
4 rue Gaillon
F-75 002 Paris
(France)
Telecopy: 33-1-42-66-78-38
Telephone: 33-1-42-66-76-27
Attention: Mark Palin
The Industrial Bank of Japan, Limited
1251 6th Avenue
New York, NY 10020
Telecopy: (212) 282-4488
Telephone: (212) 282-3412
Attention: John Dippo
Landesbank Schleswig-Holstein Girozentrale
Martensdamm 6
24103 Kiel, Germany
Telecopy: 49-431-900-2751
Telephone: 49-431-900-2166
Attention: Nikolai Ulrich
National City Bank of Pennsylvania
20 Stanwix Street
Pittsburgh, PA 15222
Telecopy: (412) 355-2283
Telephone: (412) 644-8424
Attention: Ervine Geiger
The Governor and Company of the Bank of Ireland
La Touche House, IFSC
Dublin 1, Ireland
Telecopy: 353-1-829-0129
Telephone: 353-1-670-1400
Attention: Fiona O'Connor
Willie Aherne
The Sakura Bank, Ltd.
101 Park Avenue
New York, NY 10178
Telecopy: (212) 909-4599
Telephone: (212) 909-4584
Attention: Joe Rothman
Erste Bank Der Oesterreichischen Sparkassen AG
280 Park Avenue, West Building
New York, NY 10017
Telecopy: (212) 984-5627
Telephone: (212) 984-5637
Attention: Patrick Kunkel
Bank Austria Creditanstalt Corporate Finance, Inc.
Two Greenwich Plaza
Greenwich, CT 06830
Telecopy: (203) 861-1532
Attention: William Hunter
The Sanwa Bank Limited, New York Branch
Park Avenue Plaza
55 East 52nd Street, 26th Floor
New York, NY 10055
Telecopy: (212) 339-6249
Telephone: (212) 754-2360
Attention: David Leech
Cooperatieve Centrale Raiffeisen-Boerenleenbank b.a.
Rabobank International
Croeslaan 18, Utrecht
P.O. Box 17100, 3500 HG Utrecht
The Netherlands
Attention: Marc Schmitz
The Borrower acknowledges and agrees that this Annex II may be modified from
time to time.
ANNEX III
ESTIMATED INCOME TAXES
"ESTIMATED INCOME TAXES" for any period, shall mean an amount equal to the sum
of (i) Taxable Income for such period TIMES the Weighted Blended State Tax Rate
for such period PLUS (ii) Net Taxable Income for such period TIMES the
Applicable Federal Tax Rate.
For purposes hereof, the terms listed below shall have the following meanings:
"APPLICABLE FEDERAL TAX RATE" shall mean 35%.1
"DEPRECIATION" for any period, shall mean an amount equal to (i) the aggregate
depreciation of the Portfolio Assets allocated to any calendar year (or portion
thereof) as determined in accordance with the depreciation methodology included
in the Projections times (ii) a fraction the numerator of which equals the
number of days in such period and the denominator of which equals 365 for a full
calendar year or such smaller number equal to the actual aggregate number of
days constituting the portion of any partial calendar year.
"NET TAXABLE INCOME" for any period, shall mean an amount equal to the Taxable
Income for such period MINUS the product of (i) the Taxable Income for such
period TIMES (ii) the Weighted Blended State Tax Rate applicable to such period.
"OHIO GENERATION PERCENTAGE" for any period, shall mean a fraction, the
numerator of which shall equal the actual number of MWh of electrical generation
dispatched from the Portfolio Assets located in Ohio during such period and the
denominator of which shall equal the actual aggregate amount of MWh dispatched
from all of the Portfolio Assets during such period.
"PENNSYLVANIA GENERATION PERCENTAGE" for any period, shall mean a fraction, the
numerator of which shall equal the actual number of MWh of electrical generation
dispatched from the Portfolio Assets located in Pennsylvania during such period
and the denominator of which shall equal the actual aggregate amount of MWh
dispatched from all of the Portfolio Assets during such period.
"TAXABLE INCOME" for any period, shall mean an amount equal to actual cash
Revenues received by the Borrower Entities during such period MINUS (i) actual
cash disbursed in respect of Operating Costs (other than Capital Expenditures)
during such period; MINUS (ii) actual interest paid in respect of the
Acquisition Loans and Revolving Loans during such period; MINUS (iii)
Depreciation allocated to such period ; MINUS (iv) for calendar year 2000 only,
$57,010,000 (representing a one-time deduction for transaction costs).
"WEIGHTED BLENDED STATE TAX RATE" for any period, shall mean a percentage equal
to (i) 9.99%2 TIMES the Pennsylvania Generation Percentage for such period PLUS
(ii) 8.50%3 TIMES the Ohio Generation Percentage for such period.
- -----------------
1 Federal corporate income tax rate in effect on the Closing Date.
2 Pennsylvania state corporate income tax rate in effect on the Closing Date.
3 Ohio state corporate income tax rate in effect on the Closing Date.
Each corporate income tax rate is subject to amendment based upon changes to the
corporate income tax rate implemented from time to time by any applicable
Governmental Authority.
Exhibit A
to
Amended and Restated
Credit Agreement
[Form of Acquisition Loan Note]
[NO CHANGE CURRENTLY ANTICIPATED.
EXHIBIT TO AMENDED CREDIT AGREEMENT
WILL BE THE SAME AS EXHIBIT TO
EXISTING CREDIT AGREEMENT.]
Exhibit B
to
Amended and Restated
Credit Agreement
[Form of Revolving Loan Note]
[NO CHANGE CURRENTLY ANTICIPATED.
EXHIBIT TO AMENDED CREDIT AGREEMENT
WILL BE THE SAME AS EXHIBIT TO
EXISTING CREDIT AGREEMENT.]
Exhibit C
to
Amended and Restated
Credit Agreement
[Form of Notice of Acquisition Borrowing]
[NO CHANGE CURRENTLY ANTICIPATED.
EXHIBIT TO AMENDED CREDIT AGREEMENT
WILL BE THE SAME AS EXHIBIT TO
EXISTING CREDIT AGREEMENT.]
Exhibit D
to
Amended and Restated
Credit Agreement
[Form of Notice of Revolving Borrowing]
[NO CHANGE CURRENTLY ANTICIPATED.
EXHIBIT TO AMENDED CREDIT AGREEMENT
WILL BE THE SAME AS EXHIBIT TO
EXISTING CREDIT AGREEMENT.]
Exhibit E
to
Amended and Restated
Credit Agreement
[Form of Notice of Conversion]
[NO CHANGE CURRENTLY ANTICIPATED.
EXHIBIT TO AMENDED CREDIT AGREEMENT
WILL BE THE SAME AS EXHIBIT TO
EXISTING CREDIT AGREEMENT.]
Exhibit H
to
Amended and Restated
Credit Agreement
[Form of Borrower Security Agreement]
[NO CHANGE CURRENTLY ANTICIPATED.
EXHIBIT TO AMENDED CREDIT AGREEMENT
WILL BE THE SAME AS EXHIBIT TO
EXISTING CREDIT AGREEMENT.]
Exhibit I-1
to
Amended and Restated
Credit Agreement
[Form of GP Partnership Interest Pledge Agreement]
[NO CHANGE CURRENTLY ANTICIPATED.
EXHIBIT TO AMENDED CREDIT AGREEMENT
WILL BE THE SAME AS EXHIBIT TO
EXISTING CREDIT AGREEMENT.]
Exhibit I-2
to
Amended and Restated
Credit Agreement
[Form of LP Partnership Interest Pledge Agreement]
[NO CHANGE CURRENTLY ANTICIPATED.
EXHIBIT TO AMENDED CREDIT AGREEMENT
WILL BE THE SAME AS EXHIBIT TO
EXISTING CREDIT AGREEMENT.]
Exhibit J
to
Amended and Restated
Credit Agreement
[Form of Borrower Mortgage]
[NO CHANGE CURRENTLY ANTICIPATED.
EXHIBIT TO AMENDED CREDIT AGREEMENT
WILL BE THE SAME AS EXHIBIT TO
EXISTING CREDIT AGREEMENT.]
Exhibit K
to
Amended and Restated
Credit Agreement
[Form of Assignment and Acceptance]
[NO CHANGE CURRENTLY ANTICIPATED.
EXHIBIT TO AMENDED CREDIT AGREEMENT
WILL BE THE SAME AS EXHIBIT TO
EXISTING CREDIT AGREEMENT.]
Exhibit L
to
Amended and Restated
Credit Agreement
[Form of Equity Contribution Agreement]
[NO CHANGE CURRENTLY ANTICIPATED.
EXHIBIT TO AMENDED CREDIT AGREEMENT
WILL BE THE SAME AS EXHIBIT TO
EXISTING CREDIT AGREEMENT.]
Exhibit M
to
Amended and Restated
Credit Agreement
[Form of DLC Letter of Credit]
[NO CHANGE CURRENTLY ANTICIPATED.
EXHIBIT TO AMENDED CREDIT AGREEMENT
WILL BE THE SAME AS EXHIBIT TO
EXISTING CREDIT AGREEMENT.]
Exhibit N
to
Amended and Restated
Credit Agreement
[Form of Subordinated Equity Owner Loan Agreement]
[NO CHANGE CURRENTLY ANTICIPATED.
EXHIBIT TO AMENDED CREDIT AGREEMENT
WILL BE THE SAME AS EXHIBIT TO
EXISTING CREDIT AGREEMENT.]
Exhibit O
to
Amended and Restated
Credit Agreement
[Form of Stock Pledge Agreement]
[NO CHANGE CURRENTLY ANTICIPATED.
EXHIBIT TO AMENDED CREDIT AGREEMENT
WILL BE THE SAME AS EXHIBIT TO
EXISTING CREDIT AGREEMENT.]