EXHIBIT 10.25
AMENDED AND RESTATED CREDIT AGREEMENT
This Amended and Restated Credit Agreement, dated as
of nthe 31st day of October, 1994, is made and entered into by
and among ALLEGHENY & WESTERN ENERGY CORPORATION, a West
Virginia corporation, as borrower (the "Borrower"), PNC BANK,
NATIONAL ASSOCIATION, formerly Pittsburgh National Bank, and ONE
VALLEY BANK, NATIONAL ASSOCIATION, as lenders (individually
"PNC" and "Valley" and "Bank" and collectively the "Banks") and
PNC BANK, NATIONAL ASSOCIATION, formerly Pittsburgh National
Bank, as agent for the Banks (in such capacity the "Agent").
WITNESSETH:
WHEREAS, pursuant to a Credit Agreement dated
September 24, 1990 by and among the Borrower, the Banks and the
Agent, as amended pursuant to eight (8) amendments (the "Amended
Credit Agreement"), the Banks agreed to make available certain
credit facilities to the Borrower; and
WHEREAS, the Borrower has requested the Banks to
continue to make available to it Revolving Credit Loans in an
aggregate principal amount not exceeding Five Million
($5,000,000) Dollars at any one time outstanding and to continue
to make available the Term Loans, the present aggregate
principal balance of which is Four Million ($4,000,000) Dollars;
and
WHEREAS, the Banks are willing to continue to make the
Revolving Credit Loans and the Term Loans available to the
Borrower upon the terms and conditions hereinafter set forth;
and
WHEREAS, the Borrower, the Banks and the Agent desire
to amend and restate the Amended Credit Agreement as herein set
forth.
NOW, THEREFORE, in consideration of the premises (each
of which is incorporated herein by reference) and the mutual
promises contained herein and other valuable consideration, and
with the intent to be legally bound hereby, the parties hereto
agree as follows:
ARTICLE I. THE CREDIT FACILITIES.
1.1 Revolving Credit.
(a) Revolving Credit Commitment. The Banks severally
agree to continue, subject to the terms and conditions hereof
and relying upon the representations and warranties herein set
forth, a Revolving Credit Commitment in favor of the Borrower in
the maximum aggregate principal amount of Five Million
($5,000,000) Dollars. The Borrower shall have the right to
continue to borrow, repay and reborrow, from time to time during
the period from the date hereof to and including the Revolving
Credit Maturity Date, an aggregate principal amount not to
exceed Five Million ($5,000,000) Dollars in the aggregate at any
one time outstanding. In no event shall the aggregate principal
amount of the Revolving Credit Loans from any Bank outstanding
at any time exceed its Pro Rata Share of the Revolving Credit
Commitment then in effect. The Revolving Credit Commitment may
be reduced as provided in Subsection 1.1(d). Each Bank's
Revolving Credit Commitment shall expire on the Revolving Credit
Maturity Date and all Revolving Credit Loans outstanding on such
date shall be paid in full no later than that date. Upon the
request of Borrower, made on or before the Revolving Credit
Maturity Date, that the Revolving Credit Commitment be extended
or renewed, the Banks shall give due consideration to such
request but neither Bank shall have any obligation whatsoever to
extend or renew its Revolving Credit Commitment and if such
extension or renewal is granted it shall be subject to such
terms and conditions as shall be acceptable to the Banks in
their sole discretions.
(b) Individual Revolving Credit Commitment. The
advances to the Borrower pursuant to the Revolving Credit
Commitment shall be made by the Banks in accordance with their
respective Pro Rata Shares as set forth opposite each Bank's
name below; provided, however, in no event shall any Bank be
required to advance any amount such that the total amount of
advances and readvances of such Bank at any one time outstanding
would be in excess of the Dollar amount also set forth opposite
each Bank's name below:
Pro Rata
Name Share Maximum Dollar Amount
- - - ------ --------- ---------------------
PNC 50% $ 2,500,000
Valley 50% 2,500,000
(c) Revolving Credit Borrowing and Repayment. Each
Base Rate Portion of the Revolving Credit Loans and each
repayment of such shall be in a minimum amount of Ten Thousand
($10,000) Dollars, provided, however, that each incremental unit
of borrowing or repayment in excess of Ten Thousand ($10,000)
Dollars shall be Ten Thousand ($10,000) Dollars or an integral
multiple thereof. Each Euro-Rate Portion of the Revolving
Credit Loans shall be in a minimum amount of One Hundred
Thousand ($100,000) Dollars, provided, however, that each
incremental unit of borrowing in excess of One Hundred Thousand
($100,000) Dollars shall be One Hundred Thousand ($100,000)
Dollars or an integral multiple thereof; each repayment of the
Euro-Rate Portion(s) of the Revolving Credit Loans shall be in a
minimum amount of Ten Thousand ($10,000) Dollars, provided,
however, that each incremental unit of repayment in excess of
Ten Thousand ($10,000) Dollars shall be Ten Thousand ($10,000)
Dollars or an integral multiple thereof. The aggregate
principal amount of the Revolving Credit Loans actually due and
owing to the Banks at any one time shall be the aggregate unpaid
principal amount of all advances made by the Banks pursuant to
this Section 1.1, all as shown on the loan accounts established
by the Banks pursuant to Section 1.5 hereof. The Borrower shall
not be allowed to repay any Euro-Rate Portion of the Revolving
Credit Loans other than at the end of the relevant Euro-Rate
Interest Period, unless such payment is accompanied by the
premium provided for in Subsection 1.3(f). Except as set forth
in the preceding sentence and so long as each repayment is in
the appropriate amount as set forth above, the Borrower, upon
proper notice as provided in Subsection 1.3(f), may repay,
without premium or penalty, (i) any Base Rate Portion of the
Revolving Credit Loans at any time and (ii) any Euro-Rate
Portion of the Revolving Credit Loans at the end of the relevant
Euro-Rate Interest Period therefor. The obligation of the
Borrower to repay the aggregate unpaid principal amount of all
advances made by each Bank on or before the Revolving Credit
Maturity Date shall be evidenced by Revolving Credit Notes of
the Borrower, one made payable to each Bank, each substantially
in the form of Exhibit "A" attached hereto and dated as of the
date hereof.
(d) Reduction of Availability. At any time and from
time to time upon at least five (5) Business Days' prior written
notice to the Agent, the Borrower may terminate, in whole or in
part, without penalty, the then unused portion of the Revolving
Credit Commitment, thereby causing a corresponding abatement of
the Commitment Fee. Each such reduction shall be in a minimum
principal amount of Five Hundred Thousand ($500,000) Dollars or
in integral multiples thereof. The Commitment Fee shall cease
to accrue with respect to any unused portion of the Revolving
Credit Commitment so terminated five (5) Business Days after
receipt of such notice. Notice of termination once given shall
be irrevocable and the portion of the Revolving Credit
Commitment so terminated shall not be available for borrowing
once such notice has been given under the terms hereof. The
Agent shall promptly notify each Bank of its Pro Rata Share of
such terminated unused portion and the date of each such
termination.
(e) Commitment Fee. In connection with the Revolving
Credit Commitment, the Borrower agrees to pay to the Agent, for
the benefit of the Banks (and to be shared by the Banks on such
basis as they shall agree), on December 31, 1994 and quarterly
thereafter on the last day of each March, June, September and
December and on the Revolving Credit Maturity Date, a Commitment
Fee calculated at the rate of one-quarter of one percent (1/4%)
per annum (computed upon the basis of a year of 365 or 366 days,
as the case may be, and the actual number of days elapsed) on
the daily (computed at the opening of business) unused amount of
the Revolving Credit Commitment for the quarter then ending;
provided, however, that the first payment of the Commitment Fee
shall be for the actual number of days elapsed between September
30, 1994 and December 31, 1994.
(f) Revolving Credit Disbursements. Each request for
a Disbursement under this Section 1.1 shall be made to the Agent
by an Authorized Officer orally or in writing, (i) in the case
of any Disbursement to bear interest at the Revolving Credit
Base Rate, by 11:00 A.M. (Pittsburgh, Pennsylvania time) on the
day of the proposed Disbursement and (ii) in the case of any
Disbursement to bear interest at the Revolving Credit Adjusted
Euro-Rate, by 11:00 A.M. (Pittsburgh, Pennsylvania time) at
least three (3) Business Days prior to the proposed
Disbursement. Each such request shall specify the date and
amount of the Disbursement and select the interest rate option
or options therefor pursuant to Section 1.3 hereof and, in the
case of a Disbursement which will bear interest at the Revolving
Credit Adjusted Euro-Rate, the Euro-Rate Interest Period
therefor. Any oral request for a Disbursement hereunder shall
be followed immediately by the Borrower's written confirmation
of such request. A request from the Borrower pursuant to this
Subsection 1.1(f), with respect to a Disbursement or portion
thereof which is to bear interest at the Revolving Credit
Adjusted Euro-Rate, shall irrevocably commit the Borrower to
accept such Disbursement or portion thereof on the date
specified in such request. The Agent shall promptly notify the
Banks of each request for a Disbursement, and will make such
notification on the same day on which the Agent receives a
request for a Disbursement from the Borrower, and each Bank
shall make its Pro Rata Share of such Disbursement available to
the Borrower in immediately available funds at the principal
office of the Agent prior to 12:00 noon (Pittsburgh,
Pennsylvania time) on the day of such Disbursement.
1.2 Term Credit.
(a) Term Loans. The Banks severally agree to
continue, subject to the terms and conditions hereof and relying
upon the representations and warranties herein set forth, Term
Loans in favor of the Borrower in the aggregate principal amount
of Four Million ($4,000,000) Dollars.
(b) Individual Term Loans. The advances to the
Borrower evidenced by the Term Notes were made by the Banks in
accordance with their respective Pro Rata Shares as set forth
opposite each Bank's name below:
Name Dollar Amount
PNC $ 2,000,000
Valley 2,000,000
(c) Principal Repayment and Prepayment. The Term
Loans shall be repaid in twenty (20) consecutive quarterly
installments beginning on the last day of December, 1994 and
thereafter on the last day of each March, June, September and
December until repaid in full, each payment to be in an amount
equal to Two Hundred Thousand ($200,000) Dollars. Borrower
shall have the right at any time and from time to time to prepay
the principal balance outstanding under the Term Credit in whole
or in part provided that: (i) each partial prepayment shall be
in a minimum amount of Ten Thousand ($10,000) Dollars [provided,
any prepayment in excess of Ten Thousand ($10,000) Dollars shall
be an integral multiple Ten Thousand ($10,000) Dollars] or the
principal balance outstanding under the Term Note, whichever is
less; (ii) interest on the principal amounts prepaid, accrued to
the prepayment date, shall be paid on such prepayment date; and
(iii) each partial prepayment on the Term Credit shall be
applied in payment of the last amounts of principal to be paid
under the Term Credit. If any Euro-Rate Portion of the Term
Loan is paid or prepaid other than at the end of the relevant
Euro-Rate Interest Period, such payment or prepayment shall be
accompanied by the premium provided for in Subsection 1.3(f).
Except as set forth in the preceding sentence, the Borrower,
upon proper notice as provided in Subsection 1.3(f), may repay
or prepay, without premium or penalty, (i) any Base Rate Portion
of the Term Loan at any time and (ii) any Euro-Rate Portion of
the Term Loan at the end of the Euro-Rate Interest Period
therefor. The obligation of the Borrower to repay the unpaid
principal amount of the Term Credit advance made by each Bank on
or before the Term Maturity Date shall be evidenced by Term
Notes of the Borrower, one made payable to each Bank, each
substantially in the form of Exhibit "B" attached hereto and
dated as of the date hereof.
1.3 Interest Rates, Interest Payments and Certain Related
Payments Pertaining to the Revolving Credit Loans and the Term
Loans.
(a) (1) Revolving Credit Interest. Subject to
Subsection 1.3(b)(4), each Revolving Credit Note shall bear
interest, on the actual unpaid principal amount thereof from
time to time outstanding, from September 30, 1994 until payment
in full, at the rates of interest set forth in this Section 1.3.
The Borrower shall pay accrued interest on the unpaid principal
balance of each Revolving Credit Note in arrears (i) with
respect to each Base Rate Portion bearing interest at the
Revolving Credit Base Rate (A) on the last Business Day of each
calendar month during the term of the Revolving Credit
Commitment beginning October 31, 1994, (B) at maturity, whether
by acceleration or otherwise, of the Revolving Credit Note, and
(C) after maturity, on demand until paid in full, and (ii) with
respect to each Euro-Rate Portion bearing interest at the
Revolving Credit Adjusted Euro-Rate (A) on the last day of each
relevant Euro-Rate Interest Period as provided for in Subsection
1.3(c) hereof (provided, however, if the Euro-Rate Interest
Period chosen for a Euro-Rate Portion exceeds three (3) months,
interest on that Euro-Rate Portion shall be due and payable on
the last day of the third month of such Euro-Rate Interest
Period and on the last day of such Euro-Rate Interest Period),
(B) at maturity, whether by acceleration or otherwise, of the
Revolving Credit Note, and (C) after maturity, on demand until
paid in full.
(2) Term Interest. Subject to Subsection
1.3(b)(4), each Term Note shall bear interest, on the actual
unpaid principal amount thereof from time to time outstanding,
from September 30, 1994 until payment in full, at the rates of
interest set forth in this Section 1.3. The Borrower shall pay
accrued interest on the unpaid principal balance of each Term
Note in arrears (i) with respect to each Base Rate Portion
bearing interest at the Term Base Rate (A) on the last Business
Day of each calendar month beginning October 31, 1994, (B) at
maturity, whether by acceleration or otherwise, of the Term
Note, and (C) after maturity, on demand until paid in full, and
(ii) with respect to each Euro-Rate Portion bearing interest at
the Term Adjusted Euro-Rate (A) on the last day of each relevant
Euro-Rate Interest Period as provided for in Subsection 1.3(c)
hereof (provided, however, if the Euro-Rate Interest Period
chosen for a Euro-Rate Portion exceeds three (3) months,
interest on that Euro-Rate Portion shall be due and payable on
the last day of the third month of such Euro-Rate Interest
Period and on the last day of such Euro-Rate Interest Period),
(B) at maturity, whether by acceleration or otherwise, of the
Term Note, and (C) after maturity, on demand until paid in full.
(b) (1) Revolving Credit Interest Rate Options. The
unpaid principal amount of the Revolving Credit Loans shall bear
interest, for each day until due, at one or more rates selected,
at any time or from time to time, by the Borrower from among the
Revolving Credit Interest Rate Options set forth below; it being
understood that, subject to the provisions of this Agreement,
the Borrower may select different options to apply
simultaneously to different portions of the Revolving Credit
Loans and may select different Euro-Rate Interest Periods to
apply simultaneously to different portions of the Euro-Rate
Portions of the Revolving Credit Loans.
(i) Revolving Credit Base Rate Option: A
rate per annum (computed upon the basis of a year of 365 or 366
days, as the case may be, and the actual number of days elapsed)
equal to the Prime Rate. The Revolving Credit Base Rate shall
be adjusted automatically from time to time upon each change in
the Prime Rate and in accordance with the provisions of
Subsection 1.3(e).
(ii) Revolving Credit Euro-Rate Option: A
rate per annum (computed upon the basis of a year of 365 or 366
days, as the case may be, and the actual number of days elapsed)
equal to the sum of (A) the Euro-Rate plus (B) 100 basis points
(1%) per annum. The Revolving Credit Adjusted Euro-Rate shall
be adjusted automatically from time to time upon each change in
the Euro-Rate Reserve Percentage and in accordance with the
provisions of Subsection 1.3(e).
(2) Term Interest Rate Options. The unpaid
principal amount of the Term Loans shall bear interest, for each
day until due, at one or more rates selected, at any time or
from time to time, by the Borrower from among the Term Interest
Rate Options set forth below; it being understood that, subject
to the provisions of this Agreement, the Borrower may select
different Options to apply simultaneously to different Portions
of the Term Loans and may select different Term Euro-Rate
Interest Periods to apply simultaneously to different Portions
of the Term Euro-Rate Portions of the Term Loans.
(i) Term Base Rate Option: A rate per
annum (computed upon the basis of a year of 365 or 366 days, as
the case may be, and the actual number of days elapsed) equal to
the Prime Rate. The Term Base Rate shall be adjusted
automatically from time to time upon each change in the Prime
Rate and in accordance with the provisions of Subsection 1.3(e).
(ii) Term Adjusted Euro-Rate Option: A
rate per annum (computed upon the basis of a year of 365 or 366
days, as the case may be, and the actual number of days elapsed)
equal to the sum of (A) the Euro-Rate plus (B) 125 basis points
(1-1/4%) per annum. The Term Adjusted Euro-Rate shall be
adjusted automatically from time to time upon each change in the
Euro-Rate Reserve Percentage and in accordance with the
provisions of Subsection 1.3(e).
(3) Rate Quotations. The Borrower may call the
Agent on or before the date on which it selects an Option to
receive an indication of the rate then in effect, but it is
acknowledged that such projection shall not be binding on the
Agent or any Bank nor affect the rate of interest which
thereafter is actually in effect for the Option selected.
(4) Limited Carry-over of CD Rate Options. One
or more of the Revolving Credit Loans and/or Term Loans
outstanding on the date hereof, and/or a portion(s) thereof,
bears interest at the Revolving Credit Adjusted CD Rate and/or
the Term Adjusted CD Rate (as such terms are defined in the
Amended Credit Agreement). Until the expiration of the relevant
CD Rate Interest Periods (as such term is defined in the Amended
Credit Agreement) as to such loans and portions thereof, the
provisions of Section 1.3 of the Amended Credit Agreement shall
continue to apply to such loans and portions thereof, provided,
however, that on and after the date hereof Borrower shall have
no right to elect, convert to or renew a CD Rate Option (as such
term is defined in the Amended Credit Agreement).
(c) Interest Periods; Limitations on Elections. At
any time when the Borrower shall select, convert to or renew the
Euro-Rate Option to apply to all or any portion of the
outstanding Revolving Credit Loans or the Term Loans, it shall
fix one or more periods during which such option shall apply,
such periods to be one (1) month, two (2) months, three (3)
months or six (6) months commencing on the borrowing, conversion
or renewal date; provided, however, that any Euro-Rate Interest
Period which would otherwise end on a day which is not a
Business Day shall be extended to the next succeeding Business
Day unless such Business Day falls in the next calendar month,
in which case such Euro-Rate Interest Period shall end on the
next preceding Business Day and provided, further, that any
Euro-Rate Interest Period which begins on the last day of a
calendar month for which there is no numerically corresponding
day in the subsequent calendar month during which such Euro-Rate
Interest Period is to end shall end on the last Business Day of
such subsequent month.
Elections by the Borrower of the Euro-Rate Option
shall be subject to the following limitations:
(i) The Euro-Rate Portion for each Euro-Rate Interest
Period shall be in an aggregate principal amount of One
Hundred Thousand ($100,000) Dollars or more, provided,
however, that each incremental unit in excess of One
Hundred Thousand ($100,000) Dollars shall be One Hundred
Thousand ($100,000) Dollars or an integral multiple
thereof;
(ii) No Euro-Rate Interest Period may be elected with
regard to amounts outstanding under the Revolving Credit
Commitment or the Term Credit which would end after the
Revolving Credit Maturity Date or the Term Maturity Date;
(iii) At no time may there be more than five (5)
Euro-Rate Interest Periods in effect; and
(iv) In the case of the renewal of a Euro-Rate Option
at the end of a Euro-Rate Interest Period, the first day of
the new Euro-Rate Interest Period shall be the last day of
the preceding Euro-Rate Interest Period, without
duplication in payment of interest for such day.
(d) Election, Conversion or Renewal of Interest Rate
Options. Elections of or conversions to the Base Rate Option
shall continue in effect until converted as hereinafter
provided. Elections of, conversions to or renewals of the Euro-
Rate Option shall expire as to each Euro-Rate Portion at the
expiration of the applicable Euro-Rate Interest Period.
At any time with respect to the Base Rate Portion or
at the expiration of the applicable Euro-Rate Interest Period
with respect to any Euro-Rate Portion, the Borrower [subject to
Subsection 1.3(c)] may cause all or any part of the principal
amount of such portion to be converted to and/or (in the case of
a Euro-Rate Portion) to be renewed under the Euro-Rate Option by
notice to the Agent as hereinafter provided. Such notice (i)
shall be oral or in writing and if oral immediately confirmed in
writing to the Agent, (ii) shall be irrevocable, (iii) shall be
given not later than 11:00 A.M., Pittsburgh, Pennsylvania time
not less than three (3) Business Days prior to the proposed
effective date for conversion to or renewal of, either in whole
or in part, the Euro-Rate Option and (iv) shall set forth:
(A) the effective date, which shall be a Business
Day;
(B) the new Euro-Rate Interest Period(s) selected;
and
(C) with respect to each such Euro-Rate Interest
Period, the aggregate principal amount of the corresponding
Euro-Rate Portion.
At the expiration of each Euro-Rate Interest Period,
any part (including the whole) of the principal amount of the
corresponding Euro-Rate Portion, as to which no notice of
conversion or renewal has been received as provided above, shall
automatically be converted to the Base Rate Option. The Agent
shall promptly notify the Borrower and each Bank of any such
automatic conversion.
If an Event of Default shall occur and be continuing,
the Borrower may not select, convert to or renew a Euro-Rate
Option and as provided in Subsection 1.2(e), at the end of the
then current Euro-Rate Interest Period, such part of the
Revolving Credit Loans bearing interest based upon the Euro-Rate
shall automatically be converted to a Base Rate Portion and
shall bear interest at the rate per annum set forth in part (i)
of Subsection 1.2(e).
(e) Interest Upon Occurrence of an Event of Default.
Upon the occurrence of an Event of Default and during any period
in which an Event of Default exists (i) the principal amount of
all or any part of the Base Rate Portion of the Revolving Credit
Loans or the Term Loans, whether or not the same have become due
and payable by maturity, acceleration, declaration or otherwise,
shall bear interest at a rate per annum which shall be 200 basis
points (2%) per annum above the Revolving Credit Base Rate or
the Term Base Rate, as the case may be, and (ii) the principal
amount of all or any part of the Euro-Rate Portion of the
Revolving Credit Loans or the Term Loans, whether or not the
same have become due and payable by maturity, acceleration,
declaration or otherwise, shall bear interest, until the end of
the then current Euro-Rate Interest Period, at a rate per annum
which shall be 200 basis points (2%) per annum above the
Revolving Credit Adjusted Euro-Rate or the Term Adjusted Euro-
Rate, as the case may be. At the end of the then current Euro-
Rate Interest Period, such part of the Revolving Credit Loans
and the Term Loans bearing interest at the Revolving Credit
Adjusted Euro-Rate or the Term Adjusted Euro-Rate, as the case
may be, shall automatically be converted to Revolving Credit
Loans bearing interest at the Revolving Credit Base Rate or Term
Loans bearing interest at the Term Base Rate, as the case may
be, and thereafter the interest rate shall be calculated in
accordance with part (i) of this Subsection 1.3(e).
(f) Repayments. The Borrower, upon (i) one (1)
Business Day's oral or written notice to the Agent, in the case
of the portions of Revolving Credit Loans or Term Loans bearing
interest at the Revolving Credit Base Rate or the Term Base
Rate, as the case may be, or (ii) three (3) Business Days' oral
or written notice to the Agent, in the case the portions of
Revolving Credit Loans or Term Loans bearing interest at the
Revolving Credit Adjusted Euro-Rate or the Term Adjusted Euro-
Rate, as the case may be, followed immediately thereafter by the
Borrower's written confirmation to the Agent of any oral notice,
may repay or prepay the outstanding amount of the Revolving
Credit Loans or the Term Loans in whole or in part with accrued
interest, fees and other amounts then due and payable on the
amount repaid or prepaid to the date of such repayment or
prepayment, all as set forth below. All repayment and
prepayment notices shall be irrevocable. Unless otherwise
specified by the Borrower, all repayments and prepayments shall
be applied first to the Base Rate Portion of the Revolving
Credit Loans, then to the Base Rate Portion of the Term Loans,
then to the Euro-Rate Portions of the Revolving Credit Loans
(starting with such portion subject to the Euro-Rate Interest
Period which is to expire first and thereafter to such portions
in the order of the expiration dates of their Euro-Rate Interest
Periods) and then to the Euro-Rate Portions of the Term Loans
(starting with such portion subject to the Euro-Rate Interest
Period which is to expire first and thereafter to such portions
in the order of the expiration dates of their Euro-Rate Interest
Periods). Each partial prepayment of the principal of the Term
Loans shall be applied in payment of the last amounts of
principal to be paid under the Term Notes.
The Borrower may repay or prepay a portion of the
Revolving Credit Loans or the Term Loans bearing interest at the
Revolving Credit Base Rate or the Term Base Rate, as the case
may be, without premium or penalty. If the Borrower shall repay
or prepay a portion of the Revolving Credit Loans or the Term
Loans bearing interest at the Revolving Credit Adjusted Euro-
Rate or the Term Adjusted Euro-Rate, as the case may be, prior
to the end of the relevant Euro-Rate Interest Period, the
Borrower shall pay (in addition to principal and interest) such
additional amounts as may be necessary to compensate the Banks
for any loss and any direct or indirect costs, including the
cost of reemployment of funds so repaid or prepaid at rates
lower than the cost to the Banks of such funds. Such losses and
costs, which the Banks shall exercise reasonable efforts to
minimize, shall be specified in writing (setting forth the
manner of calculation) to the Borrower by the affected Bank and,
absent manifest error in computation, shall be binding and
conclusive on the Borrower.
The Agent shall promptly notify each Bank of the
amount to be repaid or prepaid and the repayment or prepayment
date. Any such repayment or prepayment [with the exception of
special repayments pursuant to Subsection 1.3(g)] shall be
applied pro rata to each Bank's Revolving Credit Note or Term
Note, as the case may be.
Subject to the provisions of Subsections 1.1(a),
1.1(b), and 1.1(d) hereof, any repayment of the Revolving Credit
Loans shall increase, by the amount of that repayment, the
unborrowed balance of the Revolving Credit Commitment and this
increased amount shall be subject to the Commitment Fee; it
being contemplated that the Borrower may repay and reborrow
under the Revolving Credit Commitment until the Revolving Credit
Maturity Date.
(g) Yield Protection. If any Governmental Rule or
the interpretation or application thereof by any court or by any
Governmental Person charged with the administration thereof:
(i) subjects any Bank to any tax, levy, impost,
charge, fee, deduction or withholding of any kind
hereunder (other than a tax imposed or based upon
the income of such Bank) or changes the basis of
taxation of any Bank with respect to the payments
by the Borrower of principal or interest due
hereunder (other than any change which affects,
and to the extent that it affects, the taxation
of the total net income of such Bank); or
(ii) imposes, modifies or deems applicable any
reserve, special deposit or similar requirements
against assets held by any Bank; or
(iii) imposes upon any Bank any other condition
with respect to this Agreement,
such Bank shall notify the Borrower in writing as soon as
practicable after such Bank becomes aware thereof; and if the
result of any of the foregoing is to increase the cost to such
Bank, reduce the income receivable by such Bank or impose any
expense upon such Bank, with regard to all or any portion of the
Revolving Credit Loans or the Term Loans bearing interest at the
Revolving Credit Adjusted Euro-Rate or the Term Adjusted Euro-
Rate, as the case may be, by an amount determined by such Bank
in good faith and which such Bank in good faith deems material,
such Bank shall notify, from time to time, the Borrower of the
amount determined by such Bank (which determination, absent
manifest error in computation, shall be conclusive) to be
necessary to compensate it (on an after-tax basis) for such
increase in cost, reduction in income or additional expense,
setting forth the calculations and the reasons therefor. The
Borrower shall pay such amount to such Bank, as additional
consideration hereunder, within ten (10) days of the Borrower's
receipt of such notice.
(h) Euro-Rate Unascertainable. In the event that, on
any date on which the Revolving Credit Adjusted Euro-Rate or the
Term Adjusted Euro-Rate would otherwise be set, the Agent or any
Bank shall have determined (which determination shall be final
and conclusive) that adequate and reasonable means do not exist
for ascertaining the Euro-Rate or that the Euro-Rate Option will
not adequately and fairly reflect the cost to any Bank of the
establishment or maintenance of any Revolving Credit Loan or
Term Loan to which a Euro-Rate Option is to apply or that
deposits of the relevant amounts in Dollars for the relevant
Euro-Rate Interest Period for a Revolving Credit Loan or a Term
Loan is to apply are not available to any Bank in the London
interbank market or that a contingency has occurred which
materially and adversely affects the London interbank market
relating to the Euro-Rate, the Agent or such Bank shall give
prompt notice of such determination to the Borrower and to the
Banks, and, until the Agent or such Bank notifies the Borrower
and the Banks that the circumstances giving rise to such
determination no longer exist, the right of the Borrower to
borrow under, convert to or renew the Euro-Rate Option shall be
suspended. Any notice of borrowing under, conversion to or
renewal of the Euro-Rate Option which was to become effective
during the period of such suspension shall be treated as a
request to borrow under, convert to or renew the Base Rate
Option with respect to the principal amount therein specified.
(i) Illegality. If any Bank shall determine in good
faith (which determination shall be final and conclusive) that
compliance by such Bank with any applicable law, treaty or
governmental rule, regulation, guideline, order, request or
directive (whether or not having the force of law), or the
interpretation or application thereof by any Governmental
Person, has made it unlawful or impractical for such Bank to
make or maintain its portion of the Revolving Credit Loans or
the Term Loans under the Euro-Rate Option, such Bank shall give
notice of such determination to the Borrower and to the Agent.
Notwithstanding any provision of this Agreement to the contrary,
unless and until such Bank shall have given notice that the
circumstances giving rise to such determination no longer apply:
(i) with respect to any Euro-Rate Interest
Periods thereafter commencing, interest on such
Bank's Pro Rata Share of the corresponding
Revolving Credit Loans or the Term Loans bearing
interest at the Revolving Credit Adjusted Euro-
Rate or the Term Adjusted Euro-Rate, as the case
may be, shall be computed and payable under the
Base Rate Option; and
(ii) on such date, if any, as shall be
required by law, such Bank's Pro Rata Share of
any Revolving Credit Loans or Term Loans bearing
interest at the Revolving Credit Adjusted Euro-
Rate or the Term Adjusted Euro-Rate, as the case
may be, shall be automatically converted to the
Base Rate Option and the Borrower shall pay to
such Bank the accrued and unpaid interest on such
Revolving Credit Loans or Term Loans to (but not
including) the date of such conversion.
The Borrower shall pay such Bank any
additional amounts determined by such Bank in good faith to be
reasonably necessary to compensate such Bank for any costs
incurred by such Bank as a result of any conversion pursuant to
item (ii) above on a day other than the last day of the relevant
Euro-Rate Interest Period, including, but not limited to, any
interest or fees payable by such Bank to lenders of funds
obtained by it to loan or maintain the lending of its Pro Rata
Share of the Revolving Credit Loans or the Term Loan so
converted. Such Bank shall furnish to the Borrower a
certificate as to the amount necessary to compensate such Bank
for such costs (which certificate shall set forth the
calculation in reasonable detail, and, absent manifest error in
computation, shall be conclusive), and the Borrower shall pay
such amount to such Bank, as additional consideration hereunder,
within ten (10) days of the Borrower's receipt of such
certificate.
1.4 Capital Adequacy. If (i) any adoption of or
any change in or in the interpretation of any Governmental Rule,
or (ii) compliance with any Governmental Rule of any
Governmental Person exercising control over banks or financial
institutions generally or any court (whether or not having the
force of law), or (iii) any change in the force or effectiveness
of the regulations set forth at 12 C.F.R. Part 3 (Appendix A),
12 C.F.R. Part 208 (Appendix A), 12 C.F.R. Part 225 (Appendix A)
or 12 C.F.R. Part 325 (Appendix A) requires that the commitments
of any Bank hereunder (including, without limitation,
commitments and obligations in respect of the Revolving Credit
Loans and the Term Loans) be treated as an asset or otherwise be
included for purposes of calculating the appropriate amount of
capital to be maintained by such Bank or any corporation
controlling such Bank (a "Capital Adequacy Event"), such Bank
shall notify the Borrower in writing as soon as practicable
after it becomes aware thereof, and if the result thereof is to
reduce the rate of return on such Bank's capital as a
consequence of such commitments to a level below that which such
Bank could have achieved but for such Capital Adequacy Event,
taking into consideration such Bank's policies with respect to
capital adequacy, by an amount which such Bank deems in good
faith to be material, such Bank shall deliver to the Borrower a
statement of the amount necessary to compensate such Bank for
the reduction in the rate of return on its capital attributable
to such commitments (the "Capital Compensation Amount"). Each
Bank shall determine the Capital Compensation Amount in good
faith, using reasonable attribution and averaging methods. Each
Bank shall from time to time notify the Borrower of the amount
so determined. Such amount shall be due and payable by the
Borrower to such Bank fifteen (15) Business Days after such
notice is given.
1.5 Loan Accounts. Each Bank shall open and
maintain on its books a loan account in the Borrower's name with
respect to Disbursements made, repayments, prepayments, the
computation and payment of interest, Commitment Fee and other
amounts due and sums paid to such Bank hereunder. Such loan
account shall be conclusive and binding on the Borrower as to
the amount at any time due to such Bank from the Borrower,
except in the case of manifest error. Each Bank shall make
available at the request of the Borrower on no more frequently
than a calendar quarterly basis a copy of each such loan
account.
1.6 Method of Disbursements and Payments. All
Disbursements under the Revolving Credit Loans shall be made by
the Agent funding an account maintained by the Borrower with
Valley no later than 3:00 P.M. (Pittsburgh, Pennsylvania time)
on the date of the Disbursement. All payments of principal,
interest or costs relating to the Revolving Credit Loans and the
Term Loans and all Commitment Fees shall be made by the Borrower
to the Agent at the Agent's principal office no later than 11:00
A.M. (Pittsburgh, Pennsylvania time) on the date such payment is
due. All funds shall be immediately good funds when either
deposited by the Banks or paid by the Borrower.
1.7 Extension Fee. The Borrower has agreed to
pay to the Agent, for the benefit of the Banks (and to be shared
by the Banks on such basis as they shall agree), an Extension
Fee in an amount equal to Twenty Thousand ($20,000) Dollars; the
Extension Fee shall be paid upon the execution hereof.
ARTICLE II. SECURITY.
To secure the payment of the Bank
Indebtedness:
2.1 Pledge and Security Agreements. Borrower
hereby agrees to execute and deliver, or cause to be executed
and delivered, the following:
A. One or more Pledge Agreements,
substantially in the form of Exhibit "C" attached hereto, with
appropriate insertions, which shall continue to assign and
pledge to Banks, and continue to grant to Banks, a lien on and
security interest in, all of the issued and outstanding stock of
Mountaineer Gas Company and of Gas Access Systems, Inc. (wholly
owned Subsidiaries of the Borrower) and all rights, titles and
interests relating thereto, free and clear of all other
Encumbrances.
B. One or more Security Agreements
substantially in the form of Exhibit "D" attached hereto, with
appropriate insertions, which shall continue to assign and
pledge to Banks, and continue to grant to Banks, a lien on and
security interest in, all rights, titles and interests of the
Borrower in and to the Mountaineer Notes [the total aggregate
outstanding balance of which on the date hereof shall be at
least Five Million Seven Hundred Ninety-Four Thousand Two
Hundred Eighty ($5,794,280) Dollars] and all rights, titles and
interests relating thereto, free and clear of all other
Encumbrances.
C. All financing statements and all
amendments and modifications thereof and all supplements thereto
required by Banks in connection with the security interests
granted pursuant to the Pledge Agreement and the Security
Agreement.
2.2 Set-off. The Borrower hereby grants to the
Banks a lien on, and security interest in, any property,
credits, securities or monies of the Borrower which may at any
time be delivered to, or be in the possession of, or owed by any
Bank in any capacity whatever, including the balance of any
deposit account maintained by the Borrower with each Bank. The
Borrower authorizes any Bank in case of an occurrence of an
Event of Default set forth in Article VII hereof, at such Bank's
option, at any time and from time to time, to apply, at the
discretion of such Bank, to the payment of the Bank
Indebtedness, any and all monies, credits, claims or deposit
balances now or hereafter in the hands of such Bank belonging or
owed to the Borrower.
2.3 Maintenance of Accounts. The Borrower shall
maintain, or cause to be maintained, its principal operating
accounts and lockbox accounts at Valley and to deposit, or cause
to be deposited therein, a substantial portion of its funds.
ARTICLE III. REPRESENTATIONS AND WARRANTIES.
To induce the Banks to enter into this
Agreement and to continue to make the Revolving Credit Loans and
the Term Loans herein provided for, the Borrower represents and
warrants to the Banks that:
3.1 Existence and Power.
(a) Borrower's Existence and Power. The
Borrower (i) is a corporation duly organized and validly
existing under the laws of the State of West Virginia, (ii) is
duly qualified to do business and in good standing in all
jurisdictions wherein its ownership of property or the nature of
its businesses requires such qualification, (iii) has obtained
from all Governmental Persons having jurisdiction over its
activities such permissions or authorizations as are necessary
and material to properly conduct its businesses, (iv) has
20,000,000 authorized shares of common stock ($0.01 par value)
of which 7,479,360 were issued and outstanding and 629,442 were
held as treasury shares as of October 30, 1994 and 5,000,000
authorized shares of preferred stock (no par value), of which
none was issued and outstanding or held as treasury shares on
the date hereof and (v) has no other authorized classes of
capital stock.
(b) Subsidiaries' Existence and Power.
Each of the Borrower's Subsidiaries is a corporation duly
organized and validly existing under the laws of the
jurisdiction of its incorporation. Each of the Borrower's
Subsidiaries is duly qualified to do business and is in good
standing in all jurisdictions wherein its ownership of property
or the nature of its businesses requires such qualification.
Each Subsidiary has obtained from all governmental bodies and/or
regulatory agencies having jurisdiction over its activities such
permissions or authorizations as are necessary and material to
properly conduct its businesses. Each of the Borrower's
Subsidiaries, together with the Borrower's direct or indirect
ownership interest therein, is set forth on Schedule 3.1(b)
hereto.
3.2 Authority. The Borrower is duly authorized
to execute and deliver this Agreement and the other Loan
Documents and Mountaineer Gas Company and Gas Access Systems,
Inc. are duly authorized to execute and deliver the joinders
(the "Joinders") to the Pledge Agreement and the Security
Agreement; all necessary corporate action to authorize the
execution and delivery of this Agreement and the other Loan
Documents and the Joinders has been properly taken; and the
Borrower is and will continue to be duly authorized to borrow
hereunder and to perform all of the terms and provisions of this
Agreement and the other Loan Documents and Mountaineer Gas
Company and Gas Access Systems, Inc. are duly authorized to
perform all of the terms and provisions of the Joinders.
3.3 Enforceability. This Agreement and the
other Loan Documents have been duly and validly executed and
delivered by the Borrower and the Joinders have been duly and
validly executed and delivered by Mountaineer Gas Company and
Gas Access Systems, Inc. and each constitutes a valid and
legally binding agreement of the Borrower, and Mountaineer Gas
Company and Gas Access Systems, Inc., as the case may be,
enforceable in accordance with its terms, except as enforcement
may be limited by bankruptcy, insolvency, reorganization,
moratorium or similar laws relating to or limiting creditors'
rights generally or by equitable principles.
3.4 Litigation. Except as set forth in the
Borrower's Form 10-K for the fiscal year ending June 30, 1994
filed with the Securities and Exchange Commission, a copy of
which has been provided to the Banks, and as set forth in the
opinion of counsel delivered pursuant to section 6.2(vi) hereof,
there is no litigation, arbitration or governmental proceeding
pending or, to the knowledge of the Borrower, threatened against
the Borrower or any Subsidiary, the results of which would have
a material and adverse affect on the consolidated financial
condition or operations of the Borrower and its Subsidiaries
taken as a whole.
3.5 Tax Returns and Payments. The Borrower and
each Subsidiary have filed all tax returns required by law to be
filed and have paid all taxes, assessments and other
governmental charges levied upon the Borrower, any Subsidiary or
any of their respective properties, assets, income or franchises
which are due and payable, other than those currently payable or
deferrable without penalty or interest in any material amounts
or those which are being contested in good faith and by
appropriate proceedings diligently conducted. The charges,
accruals and reserves on the books of the Borrower and each
Subsidiary in respect of Federal, state and foreign income taxes
for all fiscal periods to date are adequate, and the Borrower
knows of no unpaid assessments for additional Federal, state or
foreign income taxes against it or any Subsidiary, or any basis
therefor, for any such fiscal period, which are not either
covered by adequate accruals and reserves or are being contested
in good faith by appropriate proceedings diligently conducted.
3.6 No Restrictions. Neither the execution and
delivery of this Agreement or the other Loan Documents or the
Joinders, the consummation of the transactions herein or therein
contemplated nor compliance with the terms and provisions hereof
or of the other Loan Documents or the Joinders, (i) will
conflict with or result in a breach of any of the terms,
conditions or provisions of the Articles of Incorporation or the
By-Laws of the Borrower or any Subsidiary or of any law or of
any regulation, order, writ, injunction or decree of any court
or Governmental Person or, in any material respect, of any
agreement, indenture or other instrument to which the Borrower
or any Subsidiary is a party or by which the Borrower or any
Subsidiary is bound or to which the Borrower or any Subsidiary
is subject, or (ii) will constitute a default thereunder or
result in the creation or imposition of any Encumbrance of any
nature whatsoever upon any of the property or assets of the
Borrower or any Subsidiary pursuant to the terms of any
agreement, indenture or other instrument other than this
Agreement and the other Loan Documents.
3.7 Financial Statements. The consolidated
balance sheet of the Borrower and its Subsidiaries as at June
30, 1994, and the related consolidated statements of income and
retained earnings and cash flow of the Borrower and its
Subsidiaries, for the fiscal year then ended, copies of which
have been furnished to the Banks, have been prepared in
conformity with GAAP applied on a basis consistent with that of
the immediately preceding fiscal year, and present fairly the
financial condition of the Borrower and its Subsidiaries as at
such date, and the results of their operations for the period
then ended. Since June 30, 1994 through the date hereof, there
have been no material adverse changes in the consolidated
financial position or operations of the Borrower and its
Subsidiaries taken as a whole.
3.8 Title to Properties; Encumbrances. The
Borrower and its Subsidiaries have good, sufficient and legal
title to all the properties and assets reflected in the
consolidated balance sheet referred to in Section 3.7 except as
set forth in said balance sheet or in the notes thereto and
except for assets acquired or disposed of in the ordinary course
of business or as otherwise permitted by this Agreement. All
such properties and assets are free and clear of Encumbrances,
except for Permitted Encumbrances.
3.9 ERISA. (i) All Plans and Benefit
Arrangements maintained by the Borrower or any ERISA Affiliate
for employees are set forth on Schedule 3.9. Neither the
Borrower nor any ERISA Affiliate has made any promises of
retirement or other benefits to employees or former employees
material to the consolidated financial condition or operations
of the Borrower and its Subsidiaries taken as a whole except as
set forth in any Plan or Benefit Arrangement.
(ii) Each Plan and Benefit Arrangement
has been maintained and administered in substantial compliance
with ERISA and the Code and all rules, orders and regulations
issued thereunder.
(iii) The Internal Revenue Service has
determined that each Plan and Benefit Arrangement which
constitutes an employee pension benefit plan as defined in
Section 3(2) of ERISA was qualified under Section 401(a) of the
Code, effective for plan years beginning before July 17, 1985,
and that the trusts related thereto are exempt from tax under
the provisions of Section 501(a) of the Code, effective for plan
years beginning before July 17, 1985. Nothing has occurred with
respect to any such Plan or Benefit Arrangement or to the
related trusts since the date of the most recent favorable
determination letter issued by the Internal Revenue Service
which has affected or may reasonably be expected to affect
adversely such qualification or exemption.
(iv) The Borrower and each ERISA
Affiliate has complied fully with its respective obligations
under the minimum funding standards of ERISA and the Code with
respect to each Plan. Neither the Borrower nor any ERISA
Affiliate has sought a waiver of the minimum funding standard
under Section 412 of the Code in respect of any Plan, nor failed
to make any contribution or payment to any Plan which has
resulted or could result in the imposition of a lien under ERISA
or the Code against the property or rights to property of the
Borrower or any ERISA Affiliate.
(v) No Unfunded Benefit Liabilities
exist with respect to any Plan, and no Unfunded Benefit
Liabilities would exist with respect to any Plan if such Plan
were terminated immediately which, when added to the presently
existing obligations of Borrower and its Subsidiaries for other
post retirement benefits for their employees, would aggregate in
excess of Ten Million Six Hundred Thousand ($10,600,000) Dollars
as of June 30, 1994.
(vi) No Termination Event has occurred
or is reasonably anticipated to occur with respect to any Plan
which has resulted in or which could result in the incurrence by
the Borrower or any ERISA Affiliate of any liability to the PBGC
under Title IV of ERISA, or the imposition of a lien by the PBGC
against the property or rights to property of the Borrower or
any ERISA Affiliate.
(vii) The Borrower has not engaged in
a "prohibited transaction" (as defined in Section 406 of ERISA
or in Section 4975 of the Code) involving any "employee benefit
plan" [as defined in Section 3(3) of ERISA] which would subject
the Borrower to the tax or penalty imposed under Section 502(i)
of ERISA and Section 4975 of the Code upon a "party in interest"
[as defined in Section 3(14) of ERISA], or upon a "disqualified
person" (as defined in Section 4975 of the Code).
(viii) Except as set forth on Schedule
3.9, neither the Borrower nor any ERISA Affiliate currently
contributes to, or is obligated to contribute to, or is a member
of, any Multiemployer Plan. Neither the Borrower nor any ERISA
Affiliate has incurred, or is reasonably expected to incur, any
Withdrawal Liability to any Multiemployer Plan.
(ix) The Borrower and each ERISA
Affiliate have complied with all requirements of Sections 10001
and 10002 of the Consolidated Omnibus Budget Reconciliation Act
of 1985 (Public Law No. 99-272); Title I, Subtitle B, Part 6 of
ERISA; and Section 4980B of the Code.
(x) Neither the Borrower nor any ERISA
Affiliate has entered into any transaction described in Section
4069(a) of ERISA.
(xi) No Benefit Arrangement provides
post-retirement benefits other than pensions and continuations
of medical and group life insurance benefits which would be
required to be accounted for in the income statement, balance
sheet and footnotes of the financial report of the Borrower or
any ERISA Affiliate in the manner described in the Financial
Accounting Standards Board, Proposed Statement of Financial
Accounting Standards, Employer's Accounting for Post-retirement
Benefits Other Than Pensions, if the same were effective for the
current fiscal year of the Borrower or any ERISA Affiliate.
3.10 Regulations G, T, U or X. Neither the
Borrower nor any Subsidiary is engaged in the business of
purchasing or selling margin stock (as defined in Regulations G,
T, U or X issued by the Board of Governors of the Federal
Reserve System) or extending credit to others for the purpose of
purchasing or carrying margin stock and no part of the proceeds
of any borrowing hereunder will be used to purchase or carry any
margin stock or for any other purpose which would violate any of
the margin regulations of such Board of Governors.
3.11 Performance of Contractual Obligations.
Neither the Borrower nor any of its Subsidiaries is in default
in the performance, observance or fulfillment of any of the
obligations, covenants or conditions contained in any
contractual obligation of the Borrower or its Subsidiaries, and
no condition exists which, with the giving of notice or the
lapse of time or both, would constitute such a default, except
where the consequences, direct or indirect, of such default or
condition, if any, would not have a material adverse effect on
the consolidated financial condition or operations of the
Borrower and its Subsidiaries taken as a whole.
3.12 Insurance Coverage. The Borrower currently
maintains insurance which meets or exceeds the requirements of
Section 4.3 and such insurance is of such types and in such
amounts (or in excess of such amounts) as are customarily
carried by, and insures against such risks as are customarily
insured against by, similar businesses similarly situated and
owning, leasing and operating similar properties. Any reserves
maintained by the Borrower with respect to any self-insurance
programs have been determined to provide reasonable reserves
with respect to the risks involved.
3.13 Governmental Regulation. Except as set
forth below, neither the Borrower nor any of its Subsidiaries is
(i) subject to regulation under the Public Utility Holding
Company Act of 1935, the Federal Power Act, the Interstate
Commerce Act or the Investment Company Act of 1940 or (ii)
subject to any Governmental Rule of any Governmental Person
limiting its ability to incur Indebtedness. None of the
Subsidiaries is subject to the jurisdiction of the Federal
Energy Regulatory Commission. Mountaineer Gas Company is a West
Virginia utility subject to regulation by the West Virginia
Public Service Commission. The Borrower is a "holding company",
and each of its Subsidiaries is a "subsidiary company" of a
"holding company", or an affiliate of a "holding company", as
such terms are defined in the Public Utility Holding Company Act
of 1935, but the Borrower and its Subsidiaries have been
specifically exempted from the provisions of said Act pursuant
to a filing under Section 3(a)(1) of said Act. No
authorization, consent or approval of any Governmental Person is
required which has not been obtained in connection with the
execution, delivery and performance of this Agreement and the
other Loan Documents or the Joinders.
3.14 Compliance with Applicable Laws. Neither
the Borrower nor any of its Subsidiaries is in default with
respect to any order, writ, injunction or decree (i) of any
court or arbitrator or (ii) of any Governmental Person; and the
Borrower and its Subsidiaries are substantially complying with
all applicable statutes and regulations of each Governmental
Person having jurisdiction over its activities except for those
statutes and regulations, non-compliance with which would not
have a material and adverse effect upon the consolidated
financial condition or operations of the Borrower and its
Subsidiaries taken as a whole.
3.15 Government Permits. The Borrower and its
Subsidiaries have received governmental permits in connection
with the ownership, construction, erection, installation,
operation and maintenance by the Borrower and its Subsidiaries
of their respective properties and the conduct of their
respective businesses such that the consolidated financial
condition or operations of the Borrower and its Subsidiaries
taken as a whole are not materially adversely affected. The
Borrower and its Subsidiaries have duly and substantially
complied with and are substantially observing all material
terms, conditions and restrictions contained in such
governmental permits.
3.16 Environmental Matters. (i) To the best of
the knowledge of the Senior Officers of the Borrower, after due
inquiry (which due inquiry shall not be deemed to include
obtaining environmental audits, which the Borrower has not
obtained) and except as set forth on Schedule 3.16 hereto: (A)
the Premises are in compliance with applicable Environmental
Laws (other than deviations thereof which can reasonably be
expected to not result in a material adverse effect on the
business condition, financial or otherwise, of the Borrower and
its Subsidiaries); (B) there are no Releases of Hazardous
Substances, at, upon, under or within the Premises (other than
Releases which can reasonably be expected to not result in a
material adverse effect on the business condition, financial or
otherwise, of the Borrower and its Subsidiaries); (C) there are
no underground storage tanks or PCBs at the Premises; (D) the
Premises have never been used by the Borrower or its
Subsidiaries (or, without duty of inquiry, by any predecessor in
possession or other Person) for treatment, storage, recycling,
or disposal of Hazardous Substances in violation of any
Environmental Law; and (E) no Hazardous Substances are present
at the Premises, excepting such Hazardous Substances which are
handled in accordance with all applicable Governmental Rules and
in a manner consistent with industry standards for the safe
handling of such Hazardous Substances; and
(ii) To the best of the knowledge of
the Senior Officers of the Borrower, the Borrower has no
knowledge of any basis for the imposition of any Encumbrance
against the Borrower or any Subsidiary based on any alleged
Release or breach of Environmental Law.
3.17 Indebtedness. All Indebtedness of the
Borrower and the Subsidiaries (other than intercompany
Indebtedness) is listed on Schedule 3.17. To the best of the
knowledge of the Senior Officers of the Borrower, there is no
event or occurrence as of the date hereof which constitutes a
violation or default pursuant to the terms of any Indebtedness
in excess of One Hundred Thousand ($100,000) Dollars of the
Borrower or any Subsidiary (or which, with the passage of time,
will constitute a violation or event of default) which permits
the acceleration of such Indebtedness by the creditor
thereunder.
3.18 Accuracy of Information. No information,
exhibit or report furnished by the Borrower to any Bank or the
Agent in connection with this Agreement or the Disbursement of
any proceeds of the Revolving Credit Loans or the Term Loans
contains any material misstatement of fact or omits to state a
material fact or any fact necessary to make statements contained
therein or herein not misleading.
3.19 Franchises, Patents, Copyrights, Etc. The
Borrower and its Subsidiaries have sufficient rights to
franchises, patents, copyrights, trademarks, trade names,
licenses and permits material to the conduct of their respective
businesses substantially as now conducted without known conflict
with any rights of others.
ARTICLE IV. AFFIRMATIVE COVENANTS.
For so long as any of the Bank Indebtedness
is unpaid, the Borrower agrees that:
4.1 Use of Proceeds. Proceeds of the Revolving
Credit Loans will be used by it only for general corporate
activities of the Borrower.
4.2 Furnishing Information. It will maintain a
system of accounting established and administered in accordance
with GAAP, and will set aside on its books all such proper
reserves as shall be required by GAAP. Further, the Borrower
will:
(i) deliver to the Agent within
forty-five (45) days after the end of each
of the first three quarterly fiscal periods
in each fiscal year of the Borrower, (A)
consolidated and consolidating balance
sheets as at the end of such period and (B)
consolidated and consolidating statements of
income and earnings retained for such period
and (in the case of the second and third
quarterly periods) for the period from the
beginning of the current fiscal year to the
end of such quarterly period, each setting
forth, in comparative form, corresponding
figures for the corresponding period in the
immediately preceding fiscal year and all
prepared in reasonable detail and certified,
subject to changes resulting from year-end
adjustments, by the chief financial officer
of the Borrower, all in such detail as is
reasonably satisfactory to the Agent;
(ii) deliver to the Agent within
ninety (90) days after the end of each
fiscal year of the Borrower, (A)
consolidated and consolidating balance
sheets as at the end of such year and (B)
consolidated and consolidating statements of
income and earnings retained and cash flow
for such year, each setting forth, in
comparative form, corresponding figures for
the immediately preceding fiscal year and
all prepared in reasonable detail and
certified, with respect to the consolidated
financial statements, without limitation as
to scope by Arthur Andersen & Co. or other
independent certified public accountants
acceptable to the Banks, together with a
report of such independent certified public
accountants which report shall state that
such consolidated financial statements
present fairly the financial position of the
Borrower and its Subsidiaries as at the
dates indicated and the results of their
operations and their cash flow for the
periods indicated in conformity with GAAP
and that the examination by such accountants
in connection with such consolidated
financial statements has been made in
accordance with generally accepted auditing
standards;
(iii) deliver to the Agent, together
with each delivery of financial statements
pursuant to items (i) and (ii) above, a
Compliance Certificate substantially in the
form of Exhibit "E" hereto, properly
completed, (A) stating that the signer has
reviewed the terms of this Agreement and of
the other Loan Documents and has made, or
caused to be made under his supervision, a
review of the transactions and condition of
the Borrower and its Subsidiaries during the
accounting period covered by such financial
statements and that such review has not
disclosed the existence during such
accounting period, and that the signer does
not have knowledge of the existence, as at
the date of such Compliance Certificate, of
any condition or event which constitutes an
Event of Default or which, after notice or
lapse of time or both, would constitute an
Event of Default, or, if any such condition
or event existed or exists, specifying the
nature and period of existence thereof and
what action the Borrower has taken or is
taking or proposes to take with respect
thereto, and (B) demonstrating in reasonable
detail compliance as at the end of such
accounting period with the restrictions
contained in Section 5.2 hereof;
(iv) promptly give written notice to
the Agent of the happening of any event
which constitutes an Event of Default
hereunder or which, with the passage of time
or the giving of notice or both, will result
in an Event of Default hereunder, but in no
event shall any such notice be given later
than five (5) days after the occurrence of
any of the foregoing events;
(v) promptly give written notice to
the Agent of any pending or threatened
claim, litigation or threat of litigation
which arises between the Borrower or any
Subsidiary and any other party or parties
(including without limitation a Governmental
Person) which claim, litigation or threat of
litigation is reasonably likely to
materially and adversely affect the
consolidated financial condition or
operations of the Borrower and its
Subsidiaries taken as a whole, any such
notice to be given not later than five (5)
days after the occurrence of any such claim,
litigation or threat of litigation;
(vi) deliver to the Agent copies of
(A) all management letters and other reports
submitted to the Borrower by independent
certified public accountants in connection
with an annual or interim audit of the books
of the Borrower or any of its Subsidiaries
made by such accountants, (B) all reports,
notices and proxy statements sent by the
Borrower and its Subsidiaries to its
shareholders and (C) all reports filed by
the Borrower and its Subsidiaries with any
securities exchange or the Securities and
Exchange Commission or any other
Governmental Person, or their successor in
interest; and
(vii) with reasonable promptness,
deliver to the Agent such other information
and data with respect to the Borrower or any
Subsidiary as from time to time may be
reasonably requested by any Bank.
In complying with the terms of this Section 4.2, the Borrower
shall deliver to the Agent sufficient copies of each document
required to be delivered hereunder to enable the Agent to
deliver at least one copy of each such document to each Bank.
4.3 Insurance. It will, and will cause each
Subsidiary to, (i) keep and maintain insurance on all property,
real and personal, which is insurable and customarily insured,
whether such property is now owned or hereafter acquired,
insuring such property at all times against loss or damage by
fire, flood and extended coverage risks and other hazards
(including those hazards insured under boiler, machinery and
electrical coverages) customarily insured against and in an
amount not less than the lesser of the fair market value thereof
or Thirty Million ($30,000,000) Dollars, (ii) be insured at all
times against liability on account of injury or death to Persons
and damage to property in an amount not less than Twenty-Five
Million ($25,000,000) Dollars and comply with the insurance
provisions of all applicable workers' compensation laws, (iii)
obtain fidelity bond coverage (not necessarily through a
fidelity bond) in amount and coverage customarily obtained by
others engaged in comparable businesses and comparably situated,
(iv) obtain excess liability coverage in an amount not less than
Seventy-Five Million ($75,000,000) Dollars, and (v) effect all
insurance under valid and enforceable policies issued by
insurers of recognized responsibility. Schedule 4.3 attached
hereto contains a list of each policy of insurance currently in
effect, together with information as to (i) the type of policy,
(ii) the amount of such policy, (iii) the name of the insurance
carrier, (iv) the expiration date of such policy and (v) the
applicable deductible amount of such policy, in such reasonable
detail as the Agent may require. Annually on July 31 of 1995
and of each year thereafter, the Borrower shall deliver to the
Agent a summary schedule indicating all insurance then in force
with respect to the Borrower and its Subsidiaries.
4.4 Payment of Taxes. It will, and will cause
each Subsidiary to, pay or cause to be paid all taxes,
assessments and other governmental charges levied upon any of
their respective properties or assets or in respect of their
respective franchises, business, income or profits before the
same become delinquent, except that (unless any material item of
property would be lost, forfeited or materially damaged as a
result thereof) no such charge need be paid, if it is being
contested in good faith and by appropriate proceedings promptly
initiated and diligently conducted and if appropriate, provision
as shall be required by generally accepted accounting principles
shall have been made therefor.
4.5 Corporate Records. It will, and will cause
each Subsidiary to, maintain proper books of record and account
in accordance with sound accounting practice in which full, true
and correct entries shall be made of all its and their
respective property and assets and its and their respective
dealings and business affairs.
4.6 Inspection of Records and Properties. It
will, and will cause each Subsidiary to, permit, on two (2)
Business Days' prior notice from any Bank, such Bank or such
Bank's agent or representative to visit any of its and their
respective properties, to examine its and their respective
physical assets, books of account and such reports and returns
as the Borrower or any such Subsidiary may file with any
Governmental Person, and to discuss its and their respective
affairs and accounts with, and be advised about them by, the
management of, the accountants for and other representatives of
the Borrower or any Subsidiary, all at such reasonable times and
as often as any Bank may reasonably request.
4.7 Preservation of Existence.
(a) Borrower's Preservation of Existence.
Except in the case of a merger permitted pursuant to Section
5.7, it will, at its own cost and expense, (i) do all things
necessary to preserve and keep in full force and effect its
corporate existence and qualification under the laws of the
State of West Virginia, and (ii) use its best efforts to
maintain, preserve and renew all rights, powers, contracts,
privileges and franchises, including but not limited to
qualification as a foreign corporation, which are necessary or
advantageous in the operation of its businesses.
(b) Subsidiaries' Preservation of
Existence. Except in the case of a transaction permitted
pursuant to Section 5.7, the Borrower shall cause each
Subsidiary, at such Subsidiary's own cost and expense, (i) to do
all things necessary to preserve and keep in full force and
effect its corporate existence and qualification under the laws
of the jurisdiction of its incorporation and (ii) to maintain,
preserve and renew all rights, powers, contracts, privileges and
franchises, including but not limited to qualification as a
foreign corporation, which are necessary or advantageous in the
operation of such Subsidiary's businesses.
4.8 Good Repair. Except as to any idle
facilities set forth on Schedule 4.8 attached hereto, the
Borrower will, and will cause each Subsidiary to, do all things
necessary to maintain, preserve, protect and keep their
respective property in working order and condition, and make
such repairs, renewals and replacements so that the business
carried on in connection therewith may be properly and
advantageously conducted at all times.
4.9 ERISA Reports. It will deliver to the Agent
(A) as soon as possible, and in any event no later than the date
notification is sent to the PBGC, notice of any Reportable Event
regarding any Plan and an explanation of any action proposed to
be taken with respect thereto, (B) concurrent with the filing
thereof, a copy of any request to the United States Secretary of
the Treasury for a waiver or variance of the minimum funding
standards of Section 302 of ERISA and Section 412 of the Code
with respect to any Plan, (C) as soon as possible, but in no
event later than 60 days after a Senior Officer becomes aware
that the Unfunded Benefit Liabilities [or, if applicable, the
portion of the Unfunded Benefit Liabilities that would be
allocated to the Borrower or any ERISA Affiliate under Section
4064 or Section 4068(f) of ERISA] upon termination of any Plan
or cessation of operations exceed or would exceed five percent
(5%) of the gross revenues of the Borrower or any affected ERISA
Affiliate for the fiscal year most recently ended, notice of the
occurrence of such event, (D) upon the request of any Bank,
promptly upon receipt of such request, copies of each annual
report (Form 5500 Series) with accompanying schedules filed with
respect to each Plan, (E) promptly after receipt thereof, a copy
of any notice which the Borrower or any ERISA Affiliate may
receive from the PBGC relating to the intention of the PBGC to
terminate any Plan, or to appoint a trustee to administer any
Plan, or to assert any liability under Title IV of ERISA against
the Borrower or any ERISA Affiliate, (F) promptly after receipt
thereof, a copy of any notice of assessment of Withdrawal
Liability received by the Borrower or any ERISA Affiliate from
any Multiemployer Plan, (G) as soon as possible, and in no event
later than the date notification is sent to the PBGC, notice of
the failure by the Borrower or any ERISA Affiliate to make a
required installment or other payment under Section 302 of ERISA
and Section 412 of the Code, and (H) concurrent with the filing
thereof, a copy of any Notice of Intent to Terminate any Plan
filed under Section 4041(c) of ERISA.
4.10 Compliance with Laws. It will, and will
cause each Subsidiary to, perform and promptly comply in all
material respects, and cause all property of the Borrower and
each Subsidiary to be maintained, used and operated in all
material respects in accordance with all:
(i) Governmental Rules (including,
without limitation, zoning ordinances, building codes and
Environmental Laws) of every duly constituted Governmental
Person applicable to the Borrower and each Subsidiary or any of
their respective properties;
(ii) similarly applicable orders,
rules and regulations of any regulatory organization or other
body exercising similar functions; and
(iii) similarly applicable duties or
obligations of any kind imposed under any certificate of
occupancy, or otherwise by law, covenant, condition, agreement
or easement, public or private. Notwithstanding the foregoing
provisions of this Section 4.10, the Borrower shall not be
deemed in violation of this Section 4.10 for non-compliance with
the items set forth above which would not have in the aggregate
a material and adverse effect upon the consolidated financial
condition or operation of the Borrower and its Subsidiaries
taken as a whole.
4.11 Environmental Matters. (i) It will ensure
that the Premises remain in substantial compliance with all
Environmental Laws and will not place or permit to be placed any
Hazardous Substances on the Premises, except as not prohibited
by applicable Environmental Laws, and appropriate Governmental
Persons.
(ii) It will, and will cause each
Subsidiary to, dispose of any and all material amounts of
Hazardous Waste generated at the Premises only at facilities and
with carriers that maintain valid permits under RCRA and any
other applicable Environmental Law.
(iii) Upon any Senior Officer of the
Borrower obtaining knowledge of the Release of any Hazardous
Substances at the Premises which would likely have a material
and adverse impact on the Borrower or any Subsidiary or the
operations or businesses of the Borrower or any Subsidiary or if
the Borrower or any Subsidiary receives any Environmental
Complaint from any Governmental Person which would likely have a
material and adverse impact on the Borrower or any Subsidiary,
or the operations or businesses of the Borrower or any
Subsidiary, then the Borrower shall, within seven (7) Business
Days, give written notice of same to the Agent detailing
non-privileged and non-confidential facts and circumstances of
which the Borrower is aware concerning such Release of Hazardous
Substances or Environmental Complaint. Such information is to
be provided to allow the Banks to protect their status as
creditors of the Borrower and is not intended to create any
obligation upon the Banks or the Agent with respect thereto.
(iv) It will, and will cause each
Subsidiary to, promptly upon request of the Agent, forward to
the Agent copies of any request, claim or demand for information
concerning, notification of potential liability concerning, or
any demand letter relating to any potential responsibility with
respect to the investigation or cleanup of Hazardous Substances
at any property owned, operated or used by the Borrower or any
Subsidiary or the disposal of any Hazardous Substances from any
Governmental Person or third party and will continue to forward
copies to the Agent, regarding such request, claim or demand
until the same is settled. The foregoing is not intended to
require or cause Borrower to forward copies of any such material
subject to the attorney-client privilege nor is this provision
intended to waive such privilege with respect to third party
requests for such material. The Borrower will promptly forward
to the Agent copies of all documents and reports concerning a
Release of Hazardous Substances at the Premises that would
likely have a material and adverse impact on the Borrower or any
Subsidiary or the operations or businesses of the Borrower or
any Subsidiary. Such information is to be provided solely to
allow the Agent to evaluate the status of the Banks as creditors
of the Borrower and is not intended to create any obligation
upon the Agent or the Banks with respect thereto.
ARTICLE V. NEGATIVE COVENANTS.
For so long as any of the Bank Indebtedness
shall be unpaid, the Borrower will not:
5.1 Creation of Encumbrances. Create, assume,
incur or suffer to exist, or allow any Subsidiary to create,
assume, incur or suffer to exist, any Encumbrance upon any of
its properties, whether now owned or hereafter acquired, nor
acquire nor agree to acquire any kind of property subject to an
Encumbrance; provided, however, that the foregoing restrictions
shall not prevent the Borrower or any Subsidiary from:
(i) permitting to exist the
Encumbrances listed on Schedule 5.1 hereto or created pursuant
to Article II hereof;
(ii) permitting or incurring
Encumbrances for taxes or assessments or governmental charges or
levies on any of the properties of the Borrower or any
Subsidiary if such taxes, assessments, governmental charges or
levies shall not then be due and payable, or can thereafter be
paid without penalty, or are being contested in good faith by
appropriate proceedings and with respect to which the Borrower
or the affected Subsidiary has created reserves which are
determined by the Borrower to be adequate by the application of
GAAP;
(iii) creating Encumbrances or
deposits to secure the obligations of the Borrower or any
Subsidiary under workmen's compensation laws, unemployment
insurance laws, social security laws or other similar
legislation;
(iv) making good faith deposits in
connection with bids, tenders, performance bonds, contracts or
leases to which the Borrower or any Subsidiary is a party, or
making deposits to secure public or statutory obligations;
(v) entering into performance or
completion bonds required in order for the Borrower or any
Subsidiary to obtain construction or supply contracts as the
vendor in the ordinary course of business;
(vi) incurring landlords', mechanics',
carriers', workmen's, warehousemen's, materialmen's, repairmen's
Encumbrances or other like Encumbrances in the ordinary course
of business;
(vii) making deposits to secure
surety, attachment or appeal bonds relating to legal proceedings
to which the Borrower or any Subsidiary is a party;
(viii) insuring the payment of
Encumbrances arising out of judgments or awards against the
Borrower or any Subsidiary with respect to which the Borrower or
the affected Subsidiary is currently engaged in proceedings for
review or appeal and with respect to which the Borrower or the
affected Subsidiary shall have secured a stay of execution
pending such proceedings for review or appeal;
(ix) permitting or incurring
easements, rights-of-way, restrictions and other similar
Encumbrances in the ordinary course of business which
Encumbrances do not interfere with the ordinary conduct of the
business of the Borrower or the affected Subsidiary; and
(x) creating additional Encumbrances
which are (aa) granted, or assumed, by the Borrower or a
Subsidiary in connection with the financing of property
hereafter acquired by the Borrower or such Subsidiary, provided,
that such Encumbrances are imposed only on the property so
acquired or (bb) granted by Borrower or a Subsidiary for fair
consideration on property of the Borrower or such Subsidiary,
provided, that the total of all such Encumbrances shall not be
imposed on property of the Borrower and its Subsidiaries which
has a value in excess of five percent (5%) of the Total
Capitalization of Borrower.
5.2 Financial Covenants.
(a) Current Ratio. Permit or allow the
ratio of (i) Borrower's Current Assets to (ii) Borrower's
Current Liabilities to be less than 1.0 to 1.0.
(b) Minimum Tangible Net Worth. Permit or
allow its Consolidated Tangible Net Worth, as of the last day of
each fiscal year of the Borrower, to be less than an amount
equal to the sum of Ninety-Four Million ($94,000,000) Dollars
plus an amount equal to forty percent (40%) of the Borrower's
"positive" Consolidated Net Income for each fiscal year after
June 30, 1994; any "negative" Consolidated Net Income for any
fiscal year after June 30, 1994 shall not reduce the foregoing
minimum Consolidated Tangible Net Worth requirement.
(c) Consolidated Net Income to Consolidated
Interest Expense Ratio. Permit or allow the ratio of (i) its
Consolidated Net Income, before interest and income taxes,
available for the payment of interest to (ii) its Consolidated
Interest Expense for Consolidated Indebtedness to be less than
1.25 to 1.0, calculated as of the end of each fiscal quarter for
such quarter and the three immediately preceding fiscal
quarters, for each fiscal quarter ending on or after September
30, 1994.
(d) Consolidated Funded Debt to Total
Capitalization Ratio. Permit or allow the ratio of (i) its
Consolidated Funded Debt to (ii) its Total Capitalization to be
greater than 0.5 to 1.0.
5.3 Sale of Assets. Enter into, or allow any
Subsidiary to enter into, any arrangement, directly or
indirectly, whereby the Borrower or any Subsidiary shall sell or
otherwise transfer any real or personal property, whether now
owned or hereafter acquired, except (i) sales or transfers for
fair consideration in the ordinary course of business, or (ii)
sales for fair consideration of property which, in the aggregate
for the Borrower and all Subsidiaries, have a value, immediately
prior to all such sales and immediately prior to any
extraordinary write down or other adjustment, of no more than
five percent (5%) of Total Capitalization.
5.4 Loans. Make any loan or advance to any
Person or allow any Subsidiary to do so, except that the
foregoing shall not restrict the Borrower or any Subsidiary from
(i) making intercompany loans and advances by and among the
Borrower and one or more Subsidiaries, or vice-versa, or (ii)
any loan or advance to an officer of the Borrower or any
Subsidiary provided that at no time shall such loans or advances
in the aggregate exceed Seven Hundred Fifty Thousand ($750,000)
Dollars.
5.5 Regulations G, T, U or X. Use any proceeds
hereof, either directly or indirectly, for the purpose of
"purchasing or carrying any margin stock" within the meaning of
Regulations G, T, U or X of the Board of Governors of the
Federal Reserve System, as from time to time amended.
5.6 ERISA. (i) With respect to any Plan, (A)
incur, or permit any ERISA Affiliate to incur, any liability for
failure to make timely payment of any contribution or
installment required under Section 302 of ERISA and Section 412
of the Code, whether or not waived, or otherwise fail to comply
with the funding provisions set forth therein, (B) suffer to
exist, or permit any ERISA Affiliate to suffer to exist, any
lien under Section 302(f) of ERISA or Section 412(n) of the Code
against the property and rights to property of the Borrower or
any ERISA Affiliate, or (C) terminate, or permit any ERISA
Affiliate to terminate, any such Plan in a manner which could
result in the imposition of a lien upon the property or rights
to property of the Borrower or any ERISA Affiliate pursuant to
Section 4068 of ERISA.
(ii) Engage in, or permit any ERISA
Affiliate to engage in, any "prohibited transaction" (as defined
in Section 406 of ERISA or Section 4975 of the Code) with
respect to any "employee benefit plan" [as defined in Section
3(3) of ERISA] for which a statutory or administrative exemption
is not available under Section 408 of ERISA or Section 4975 of
the Code.
(iii) Partially or completely withdraw
from, or permit any ERISA Affiliate to partially or completely
withdraw from, any Multiemployer Plan so as to subject the
Borrower or any ERISA Affiliate to Withdrawal Liability.
5.7 Merger. Except for the merger of any
Subsidiary into the Borrower or another Subsidiary, consolidate
with, or merge into any Person, or permit any Person to merge
into it or any Subsidiary, or acquire all or a substantial part
of the assets or capital stock of any Person or permit any
Subsidiary to do so, if such acquisition is analogous in either
purpose or effect to a consolidation or merger; provided,
however, that any of the foregoing may be permitted, if:
(i) the surviving corporation shall be
the Borrower or a Subsidiary, as the case
may be; provided, however, that the Person
to be merged or consolidated with, operates
a business related to that of the Borrower
or any Subsidiary; and
(ii) immediately after and giving
effect to such transaction the Consolidated
Tangible Net Worth of the Borrower and its
Subsidiaries equals or exceeds the
Consolidated Tangible Net Worth of the
Borrower and its Subsidiaries immediately
preceding such transaction; and
(iii) immediately after and giving
effect to such transaction, no condition or
event shall exist which constitutes an Event
of Default or which, after notice or lapse
of time or both, would constitute an Event
of Default.
ARTICLE VI. CONDITIONS TO CONTINUATION OF LOANS.
6.1 All Revolving Credit and Term Credit
Borrowings. The obligation of each of the Banks to continue to
make and to have outstanding each Revolving Credit Loan and to
continue to have outstanding Term Loans pursuant to Sections 1.1
and 1.2 hereof is subject to the performance by the Borrower of
its obligations under this Agreement and the other Loan
Documents and to the satisfaction of the following further
conditions:
(i) With respect to a borrowing, except for
a borrowing made simultaneously with the
execution of this Agreement, receipt by the
Agent of a Disbursement request satisfying
the requirements of Subsection 1.1(f);
(ii) The fact that, at the time of each
borrowing, no Event of Default specified in
Article VII and no event which, with the
giving of notice or lapse of time or both
would become such an Event of Default, shall
have occurred and be continuing; and
(iii) The fact that the representations and
warranties contained in this Agreement and
the other Loan Documents are true and
correct in all material respects on and as
of the date of borrowing.
Each request for a borrowing shall be deemed to be, as of the
date of such borrowing, a representation and warranty by the
Borrower as to the facts specified in items (ii) and (iii)
above, except that with respect to item (iii) above, such
representations and warranties shall be modified to the extent
the Borrower shall have previously notified the Banks and the
Agent in accordance with the terms of this Agreement and the
other Loan Documents of matters relating thereto which modify
such representations and warranties.
6.2 Effectiveness of this Agreement. This
Agreement shall not become effective unless on or before the
date hereof the Borrower shall have performed all of its
obligations under this Agreement and the other Loan Documents to
be performed on or before such date and unless on or before the
date hereof the following conditions shall have been satisfied:
(i) Receipt by each Bank of a counterpart
original of this Agreement, the Pledge Agreement and the
Security Agreement executed by the Banks, the Agent and the
Borrower.
(ii) Receipt by each Bank of a fully
executed and properly completed Revolving Credit Note and Term
Note made payable to it.
(iii) Receipt by the Agent on behalf of the
Banks of a certified copy (certified by the appropriate
governmental official) of the Borrower's and Subsidiaries
Articles of Incorporation.
(iv) Receipt by the Agent on behalf of the
Banks of good standing certificates for the Borrower and the
Subsidiaries issued by the appropriate Governmental Person and
dated no more than ten (10) days prior to the date hereof.
(v) Receipt by the Agent on behalf of the
Banks of a copy, duly certified as of the date hereof by the
secretary or assistant secretary of the Borrower, of (A) the
by-laws of the Borrower and the Subsidiaries and all amendments
thereto, (B) the resolutions of the Borrower's Board of
Directors authorizing the borrowings hereunder and the execution
and delivery of this Agreement and the other Loan Documents, and
(C) a certificate of incumbency that certifies the names of the
officers of the Borrower authorized to sign this Agreement and
the other Loan Documents and which contains a true signature of
each such officer.
(vi) Receipt by the Agent on behalf of the
Banks of a signed favorable opinion of Robinson & McElwee,
counsel for the Borrower, Mountaineer Gas Company and Gas Access
Systems, Inc., (A) with respect to each of the matters set forth
in Sections 3.1, 3.2, 3.3, 3.4, 3.6, 3.10 and 3.13, (B)
specifying the action which has been taken to authorize the
making, delivery and performance by the Borrower of this
Agreement and the other Loan Documents and by Mountaineer Gas
Company and Gas Access Systems, Inc. of the Joinders and (C) to
such other matters as the Agent may reasonably require including
but not limited to matters relating to the liens and security
interests to be granted to Banks on and in the stock of
Mountaineer Gas Company and of Gas Access Systems, Inc. and on
and in the Mountaineer Notes.
ARTICLE VII. DEFAULTS.
7.1 Events of Default. If one or more of the
Events of Default occur then (i) if such Event of Default is set
forth in Subsections 7.1(c) or 7.1(d) hereof (A) the Revolving
Credit Commitment shall automatically and immediately terminate,
(B) the obligation of the Banks to make or to continue any
Revolving Credit Loan or Term Loan shall automatically and
immediately terminate and (C) the Revolving Credit Notes and the
Term Notes shall become immediately due and payable, without
necessity of demand, presentation, protest, notice of dishonor
or notice of default; or (ii) if such Event of Default is set
forth in any of the remaining Subsections of this Article VII,
the Banks at their option, upon notice to the Borrower, may (A)
terminate the Revolving Credit Commitment, (B) terminate the
obligation of the Banks to continue any Term Loan and (C)
declare the Borrower in default hereunder, in which event the
Revolving Credit Notes and the Term Notes shall become
immediately due and payable, without necessity of any further
demand, presentation, protest, notice of dishonor or further
notice of default.
(a) Payment Default. Default in the
payment of (i) the principal of the Revolving Credit Notes or
the Term Notes, and continuance of such nonpayment for ten (10)
days after the due date, (ii) the interest on the Revolving
Credit Notes or the Term Notes, and continuance of such
nonpayment for ten (10) days after the due date, (iii) the
Commitment Fee, and continuance of such nonpayment for ten (10)
days after the due date, or (iv) any other commission, fee or
charge payable to the Banks or the Agent pursuant to this
Agreement or any other Loan Documents, and continuance of such
nonpayment for ten (10) days after the due date or ten (10) days
after notice of the amount due has been given to Borrower,
whichever last occurs.
(b) Nonpayment of Other Indebtedness. (i)
Default by Mountaineer in the payment when due (whether by
acceleration or otherwise) of principal or interest on any
Mountaineer Note or (ii) default by the Borrower or any
Subsidiary in the payment when due (whether by acceleration or
otherwise) of principal or interest on any other Indebtedness in
excess of One Hundred Thousand ($100,000) Dollars or default by
the Borrower or any Subsidiary in the performance of any
agreement under which any such obligation is created, if the
effect of such default is to cause the holders of such
obligation (or any Person on behalf of such holders) to declare
such obligation due prior to its expressed maturity.
(c) Insolvency.
(i) Involuntary Proceedings A
proceeding shall have been instituted in a court having
jurisdiction seeking a decree or order for relief in respect of
the Borrower or any Subsidiary in an involuntary case under the
Federal bankruptcy laws, or any other similar applicable Federal
or state law, now or hereafter in effect, or for the appointment
of a receiver, liquidator, trustee, sequestrator or similar
official for the Borrower or any Subsidiary or for a substantial
part of their respective property, or for the winding up or
liquidation of their respective affairs, and such shall remain
undismissed or unstayed and in effect for a period of sixty (60)
days.
(ii) Consensual Proceedings. The
Borrower or any Subsidiary shall institute proceedings to be
adjudicated a voluntary bankrupt, or shall consent to the filing
of a bankruptcy proceeding against it, or shall file a petition
or answer or consent seeking reorganization under the Federal
bankruptcy laws, or any other similar applicable Federal or
state law now or hereinafter in effect, or shall consent to or
acquiesce in the filing of any such petition or shall consent to
or acquiesce in the appointment of a receiver, liquidator,
trustee, sequestrator or similar official for the Borrower or
any Subsidiary or for a substantial part of their respective
property, or shall make an assignment for the benefit of
creditors, or shall admit in writing its inability to pay its
debts generally as they become due, or action shall be taken by
the Borrower or any Subsidiary in furtherance of any of the
aforesaid purposes.
(d) Termination of Existence. The Borrower
or any Subsidiary terminates its existence, except by reason of
a transaction permitted pursuant to Section 5.7.
(e) Adverse Judgments. Any court shall
render a final judgment or judgments against the Borrower or any
Subsidiary in an aggregate amount of Twenty-Five Thousand
($25,000) Dollars or more in excess of any insurance protecting
against such liability and such judgment or judgments shall not
be stayed, discharged, satisfied, vacated or set aside within
sixty (60) days after entry; or any property of the Borrower or
any Subsidiary shall be attached by reason of a judgment under a
claim or claims in an aggregate amount of Twenty-Five Thousand
($25,000) Dollars or more in excess of any insurance protecting
against the liabilities on which such attachments are based and
such attachments shall not be released or provided for to the
satisfaction of the Banks within sixty (60) days.
(f) Failure to Take Corrective Action. The
Borrower shall fail to take reasonable corrective measures
satisfactory to the Banks within ninety (90) days after notice
to the Borrower by the Agent with respect to any Environmental
Action then pending or threatened against the Borrower or any
Subsidiary the outcome of which would materially and adversely
affect the consolidated financial condition or the operations of
the Borrower and its Subsidiaries taken as a whole.
(g) ERISA.
(i) The Borrower shall default in the
due performance or observance of the provisions of Section 4.9
or the provisions of Section 5.6.
(ii) A Notice of Intent to Terminate
any Plan shall be filed under Section 4041(c) of ERISA.
(iii) Proceedings shall be instituted
for the appointment of a trustee by the appropriate United
States court to administer any Plan.
(iv) PBGC shall institute proceedings
to terminate any Plan or to appoint a trustee to administer any
such Plan.
(v) The Borrower and/or any ERISA
Affiliate shall incur any liability to the PBGC in connection
with the termination of any Plan in excess of Two Hundred Fifty
Thousand ($250,000) Dollars.
(vi) A notice assessing Withdrawal
Liability with respect to any Multiemployer Plan shall have been
received by the Borrower or any ERISA Affiliate.
(vii) Any applicable Governmental Rule
is adopted, changed or interpreted by any Governmental Person or
agency or court with respect to or otherwise affecting one or
more Plans, Multiemployer Plans or Benefit Arrangements which,
in the reasonable opinion of the Banks, could have a material
adverse effect on the financial condition of the Borrower and
its Subsidiaries taken as a whole; provided, however, any such
change shall not be deemed material unless it results in the
imposition of liabilities or a charge against income or retained
earnings in any one fiscal year of the Borrower by a sum in
excess of three percent (3%) of its Consolidated Tangible Net
Worth.
(h) Failure to Comply with Covenants.
(i) Failure to Comply with Article V
Covenants. Default in the performance by the Borrower of any of
the covenants set forth in Article V hereof.
(ii) Failure to Comply with Remaining
Covenants. Default in the performance by the Borrower in any
material respect of the Borrower's agreements set forth herein
and the other Loan Documents, or default in the performance by
Mountaineer Gas Company or Gas Access Systems, Inc. of their
agreements set forth in the Joinders, and not constituting an
Event of Default enumerated elsewhere in this Article VII and
continuance thereof for thirty (30) days after the Borrower
first becomes aware of such non-performance.
(i) Misrepresentation. Any representation
or warranty made by the Borrower herein or in any other Loan
Document is untrue in any material respect, or any schedule,
statement, report, notice or writing furnished by the Borrower
to the Agent or the Banks pursuant hereto or any other Loan
Document is untrue in any material respect on the date as of
which the facts set forth are stated or certified.
7.2 Remedies Upon Default. Upon the occurrence
of an Event of Default, the Agent and the Banks shall have no
obligation to make any additional Disbursements or allow the
election of any Options, and shall have the full panoply of
rights and remedies granted to them under this Agreement and the
other Loan Documents and all those rights and remedies granted
by law to creditors, and the Agent and the Banks may proceed to
protect and enforce their rights by an action at law, suit in
equity or other appropriate proceeding, whether for the specific
performance of any agreement contained herein, or for an
injunction against a violation of any of the terms hereof, or in
aid of the exercise of any power granted hereby or by law. No
right, power or remedy conferred by this Agreement or any other
Loan Document upon the Agent and the Banks shall be exclusive of
any other right, power or remedy referred to herein or therein
or now or hereafter available at law, in equity, by statute or
otherwise. No exercise of any one right or remedy shall be
deemed a waiver of other rights or remedies.
ARTICLE VIII. APPOINTMENT OF AGENT.
8.1 Appointment and Grant of Authority. The
Banks hereby appoint PNC Bank, National Association, and PNC
Bank, National Association, hereby agrees to act as Agent under
this Agreement and the other Loan Documents. The Agent shall
have and may exercise such powers under this Agreement and the
other Loan Documents as are specifically delegated to it by the
terms hereof or by any other agreement between the Banks and the
Agent, together with such other powers as are incidental
thereto. The Borrower may reasonably rely on any written
communication from the Agent to the Borrower that specifically
states that the Agent is notifying the Borrower on behalf of the
Banks, or is executing any waiver or consent on behalf of the
Banks.
8.2 Agent's Rights as a Bank. With respect to
the commitment of PNC to make or continue any Revolving Credit
Loans or to continue any Term Loans under this Agreement, and
with respect to the security for such Revolving Credit Loans and
Term Loans, PNC shall have the same rights and powers under this
Agreement and any other Loan Document as any Bank and may
exercise such rights and powers as though it were not the Agent.
8.3 Pro Rata Sharing. Any sums obtained from
the Borrower by any Bank by reason of the exercise of its rights
of setoff or banker's encumbrance shall be shared pro rata among
the Banks in accordance with their respective commitments and
loans set forth in Subsection 1.1(b) and Subsection 1.2(b).
8.4 Successor Agent. The Agent may resign as
Agent upon ninety (90) days' notice to the Banks and the
Borrower. If such notice shall be given, the Agent shall use
reasonable commercial efforts during such ninety (90) day period
to procure a successor reasonably satisfactory to the Banks to
serve as agent hereunder. If at the end of such ninety (90) day
period the Agent shall be unable to procure such a successor,
the Banks shall appoint from among the Banks a successor agent
for the Banks. Any such successor agent shall succeed to the
rights, powers and duties of the Agent. Upon the appointment of
such successor agent or upon the expiration of such ninety (90)
day period (or any longer period to which the Agent has agreed),
the former Agent's rights, powers and duties as Agent shall be
terminated, without any other or further act or deed on the part
of such former Agent or any of the parties to this Agreement.
ARTICLE IX. DEFINITIONS.
9.1 Defined Terms. As used herein the following
terms shall have the meaning specified unless the context
otherwise requires:
"Agent" means PNC Bank, National
Association, and its successors appointed pursuant to Article
VIII in their capacities as administrative agent.
"Agreement" means this Amended and Restated
Credit Agreement and all extensions, renewals, amendments,
substitutions and replacements thereto and thereof.
"Amended Credit Agreement" shall have the
meaning given it in the first "Whereas" clause of this
Agreement.
"Authorized Officer" means the Chief
Executive Officer or Chief Financial Officer of the Borrower or
any other officer of the Borrower designated in writing by such
Chief Executive Officer or Chief Financial Officer.
"Bank(s)" means individually and
collectively PNC and Valley.
"Bank Indebtedness" means the Indebtedness
of the Borrower to the Banks and the Agent hereunder and under
the other Loan Documents together with any and all costs and
expenses incurred by the Banks and the Agent in connection with
the enforcement of this Agreement and the other Loan Documents
or the protection of the rights of the Banks and the Agent
hereunder and under the other Loan Documents.
"Base Rate" means the interest rate relating
to the Base Rate Option as described in Subsection 1.3(b).
"Base Rate Option(s)" means the Revolving
Credit Base Rate Option and/or the Term Base Rate Option, as the
case may be.
"Base Rate Portion(s)" means a Revolving
Credit Loan and/or a Term Loan, or a portion(s) thereof, which
bears, or is to bear, interest at the Revolving Credit Base Rate
or the Term Base Rate, as the case may be.
"Benefit Arrangement(s)" 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 the Borrower
and/or any ERISA Affiliate.
"Borrower" means Allegheny & Western Energy
Corporation, a corporation organized and existing under the laws
of the State of West Virginia.
"Borrower's Current Assets" means, as at any
date of determination, the current assets of the Borrower
determined in conformity with GAAP.
"Borrower's Current Liabilities" means, as
at any date of determination, the current liabilities of the
Borrower determined in conformity with GAAP.
"Business Day" means a day on which the
Agent's principal office is open for the conduct of normal
commercial banking business.
"Capital Adequacy Event" shall have the
meaning given it in Section 1.4.
"Capital Compensation Amount(s)" shall have
the meaning given it in Section 1.4.
"Code" means the Internal Revenue Code of
1986, as amended from time to time, or any successor legislation
thereto, together with all regulations promulgated and rulings
issued thereunder.
"Commitment Fee" means the fee described in
Subsection 1.1(e).
"Compliance Certificate" means the
Compliance Certificate in substantially the form of Exhibit "E"
hereto.
"Consolidated Indebtedness" means, as at any
date of determination, the Indebtedness of the Borrower and its
Subsidiaries, on a consolidated basis determined in conformity
with GAAP consistently applied.
"Consolidated Interest Expense" means, as at
any date of determination, all expense items classified as
interest expense for the period in question in accordance with
GAAP on the consolidated statement of profits and losses of the
Borrower and its Subsidiaries, including without limitation
interest paid or accrued on any Indebtedness of the Borrower and
its Subsidiaries for the period in question, and any portion of
payments made or accrued on capitalized leases which under GAAP
is classified as an interest expense, less any applicable bond
or note premiums applicable for the period in question, all
determined on a consolidated basis in conformity with GAAP
consistently applied; provided, however, in no event shall
Consolidated Interest Expense include any items which would be
or are eliminated in consolidation.
"Consolidated Funded Debt" means, as at any
date of determination, the Funded Debt of the Borrower and its
Subsidiaries, on a consolidated basis determined in conformity
with GAAP consistently applied.
"Consolidated Liabilities" means, as at any
date of determination, all obligations and liabilities of the
Borrower and its Subsidiaries which, in accordance with GAAP
consistently applied, would be classified as liabilities on the
consolidated balance sheet of the Borrower and its Subsidiaries.
"Consolidated Net Income" means, as at any
date of determination, the net income of Borrower and its
Subsidiaries on a consolidated basis, determined in accordance
with GAAP consistently applied.
"Consolidated Tangible Net Worth" means, as
at any date of determination, the sum of (i) the capital stock
and additional paid-in capital of the Borrower and its
Subsidiaries plus (ii) the retained earnings (or minus
accumulated deficit) of the Borrower and its Subsidiaries minus
(iii) the intangible assets (including, without limitation,
franchises, patents, patent applications, trademarks, brand
names and goodwill) of the Borrower and its Subsidiaries, all
determined on a consolidated basis in conformity with GAAP
consistently applied.
"Disbursement(s)" means each advance of
funds by the Banks under the Revolving Credit Commitment.
"Dollar(s)" or "$" means the legal tender of
the United States of America.
"Encumbrance(s)" means any lien, mortgage,
encumbrance, charge, pledge, security interest, priority
payment, conditional sales agreement right, or other title
retention agreement right (including any right under a lease
which in accordance with GAAP would be treated as a capitalized
item) whether or not voluntarily given.
"Environmental Action" means (i) any event
whereby any Governmental Person perfects a lien upon any or all
of the Premises by reason of the occurrence of a Release of a
Hazardous Substance; (ii) the filing or similar commencement of
an Environmental Complaint against the Borrower or any
Subsidiary of the Borrower, or (iii) the expenditure by any
Governmental Person of an amount in excess of Fifty Thousand
($50,000) Dollars to respond to a Release of a Hazardous
Substance or Environmental Complaint on or pertaining to the
Premises.
"Environmental Complaint" means, for any
Person, any notice of violation of an Environmental Law, request
for information from any Governmental Person in reference to an
alleged violation of an Environmental Law by such Person or
affecting such Person, or notification by any Governmental
Person that such Person is potentially responsible for
investigation or cleanup of environmental conditions on the
Premises or as a result of activities thereon, or any demand
letter or complaint, order, citation, or other written notice
with regard to any Release of a Hazardous Substance affecting
the Premises or Borrower's or any Subsidiary's interest therein.
"Environmental Law(s)" means any and all
statutes, laws, regulations, ordinances, rules, judgments, court
orders, consent decrees, permits, licenses, binding agreements
or other governmental restrictions relating to the protection of
the environment or the release of any hazardous substances into
the environment.
"ERISA" means the Employee Retirement Income
Security Act of 1974 as now in effect and as hereafter from time
to time amended, or any successor statute, together with the
regulations promulgated and rulings issued thereunder.
"ERISA Affiliate" means at any time any
member of a controlled group of corporations of which the
Borrower is a member, and any trade or business (whether or not
incorporated) under common control with the Borrower, and all
other entities which, together with the Borrower are or were
treated as a single employer under Section 414 of the Code.
"Euro-Rate" means, with respect to the Euro-
Rate Portions of the Revolving Credit Loans and Term Loans to
which the Euro-Rate Option applies for any Euro-Rate Interest
Period, the interest rate per annum determined by the Agent by
dividing (the resulting quotient rounded upward to the nearest
1/100 of 1% per annum) (i) the rate of interest determined by
the Agent in accordance with its usual procedures (which
determination shall be conclusive absent manifest error) to be
the average of the rates of interest per annum for deposits in
U.S. Dollars offered by banks in the London interbank market to
major money center banks at approximately 11:00 A.M. London time
two (2) Business Days prior to the first day of such Euro-Rate
Interest Period for delivery on the first day of such Euro-Rate
Interest Period in amounts comparable to such Euro-Rate Portions
and having maturities comparable to such Euro-Rate Interest
Period by (ii) a number equal to 1.00 minus the Euro-Rate
Reserve Percentage. The Euro-Rate may also be expressed by the
following formula:
[average of rates offered to ]
Euro-Rate = [major money center banks ]
[in the London interbank market ]
[as determined by Agent ]
1.00 - Euro-Rate Reserve Percentage
The Euro-Rate shall be adjusted with respect to any Euro-Rate
Option outstanding on the effective date of any change in the
Euro-Rate Reserve Percentage as of such effective date. The
Agent shall give prompt notice to the Borrower of the Euro-Rate
as determined or adjusted in accordance herewith, which
determination shall be conclusive absent manifest error.
"Euro-Rate Interest Period(s)" means any
individual period of one (1), two (2), three (3) or six (6)
months selected by the Borrower and commencing on the borrowing
date, conversion date or renewal date of a Euro-Rate Portion to
which such period shall apply.
"Euro-Rate Option(s)" means the Revolving
Credit Euro-Rate Option and/or the Term Euro-Rate Option, as the
case may be.
"Euro-Rate Portion(s)" means a Revolving
Credit Loan and/or Term Loan, or a portion(s) thereof, which
bears, or is to bear, interest at the Revolving Credit Adjusted
Euro-Rate or the Term Adjusted Euro-Rate, as the case may be.
"Euro-Rate Reserve Percentage" means, for
any day, the percentage (expressed as a decimal rounded upward
to the nearest 1/100 of 1%) as determined by the Agent in
accordance with its usual procedures (which determination shall
be conclusive absent manifest errors) which is in effect on such
day as prescribed by the Board of Governors of the Federal
Reserve System (or any successor) for determining the reserve
requirements (including, without limitation, supplemental,
marginal and emergency reserve requirements) for the Agent with
respect to eurocurrency funding (currently referred to as
"Eurocurrency Liabilities").
"Event(s) of Default" means any one or more
of the events described in Section 7.1 of this Agreement.
"Extension Fee" means the fee described in
Section 1.7.
"Funded Debt" means all Indebtedness which
by its terms matures more than one year from the date of its
incurrence (other than the Revolving Credit), any Indebtedness
maturing within one year from such date which is renewable at
the option of the debtor beyond one year from such date
(including any Indebtedness for money borrowed which may be
incurred under a revolving credit or similar agreement having a
maturity more than one year from such date, and including
Indebtedness in respect of commercial paper of the obligor, if
there exists a revolving credit agreement, term loan or similar
agreement having a term greater than one year, to provide a
source of repayment in the event the obligor is unable to refund
such commercial paper out of the proceeds of other commercial
paper), all capitalized lease obligations of lessees under
capitalized leases, and all Guarantees of any such Indebtedness
of others.
"GAAP" means generally accepted accounting
principles which shall include, but not be limited to, the
official interpretations thereof as defined by the Financial
Accounting Standards Board, its predecessors and it successors.
"Governmental Person" means the government
of the United States or the government of any state or locality
therein, any political subdivision or any governmental, quasi-
governmental, judicial, public or statutory instrumentality,
authority, body or entity, or other regulatory bureau,
authority, body or entity of the United States or any state or
locality therein, including the Federal Deposit Insurance
Company, the Comptroller of the Currency or the Board of
Governors of the Federal Reserve System, any central bank or any
comparable authority.
"Governmental Rule" means any law, statute,
rule, regulation, ordinance, order, judgment, guideline or
decision of any Governmental Person.
"Guaranty or Guarantee" means any
obligation, direct or indirect, by which a Person undertakes to
guaranty, assume or remain liable for the payment of another
Person's obligations, including but not limited to (i)
endorsements of negotiable instruments, (ii) discounts with
recourse, (iii) agreements to pay upon a second Person's failure
to pay, (iv) agreements to maintain the capital, working capital
solvency or general financial condition of a second Person and
(v) agreements for the purchase or other acquisition of
products, materials, supplies or services, if in any case
payment therefor is to be made regardless of the non-delivery of
such products, materials or supplies or the non-furnishing of
such services.
"Hazardous Substance(s)" means any substance
which is defined as a "hazardous substance" by the Comprehensive
Environmental Response, Compensation and Liability Act of 1980
as amended ("CERCLA"), 42 U.S.C Section 9601 et seq. or defined
as "hazardous wastes" by RCRA or the regulations
promulgated pursuant thereto.
"Indebtedness" means, with respect to any
Person, without duplication, (i) all obligations and
indebtedness of such Person for borrowed money, (ii) all
obligations of such Person evidenced by bonds, debentures, notes
or similar instruments, including, without limitation, all
obligations of such Person which constitute the source of
payment of principal, interest or premium, if any, on any
industrial revenue bond issued to provide financing for such
Person, (iii) all obligations of such Person under conditional
sale or other title retention agreements relating to property
purchased by such Person, (iv) all obligations of such Person
issued or assumed as the deferred purchase price of property or
services, (v) all capital lease obligations of such Person, (vi)
the face amount of all letters of credit issued for the account
of such Person, (vii) all obligations of others secured by any
Encumbrance on property or assets owned or acquired by such
Person, whether or not the obligations secured thereby have been
assumed, and (viii) all Guarantees of such Person.
"Loan Documents" means the Credit Agreement,
the Revolving Credit Notes, the Term Notes, the Pledge
Agreements, the Security Agreement and all other instruments and
documents relating thereto.
"Mountaineer Notes" means those certain
promissory notes identified on Schedule A to the Security
Agreement.
"Multiemployer Plan" means a "multiemployer
plan" as defined in Section 4001(a)(3) of ERISA to which the
Borrower or any ERISA Affiliate is making or accruing an
obligation to make contributions or has within any of the
preceding five (5) plan years made or accrued an obligation to
make contributions.
"Option(s)" means any one or more of the
Base Rate Option or the Euro-Rate Option.
"PBGC" means the Pension Benefit Guaranty
Corporation established pursuant to ERISA or any successor
entity.
"Permitted Encumbrances" means the types of
Encumbrances set forth in items (i) through (x) of Section 5.1
hereof.
"Person" means any individual, partnership,
corporation, trust, joint venture or unincorporated organization
and any government or department or agency thereof.
"Plan(s)" 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 302 of ERISA and Section 412 of the Code
and either (i) is maintained by the Borrower and/or any ERISA
Affiliate for employees of the Borrower and/or any ERISA
Affiliate or (ii) has at any time within the preceding five (5)
years been maintained by the Borrower and/or any entity which
was at such time an ERISA Affiliate for employees of the
Borrower or any entity which was at such time an ERISA
Affiliate.
"Pledge Agreement" means the agreement to be
executed and delivered by Borrower pursuant to Subsection
2.1(A), and all renewals, amendments, substitutions, or
replacements thereto and thereof.
"PNC" means PNC Bank, National Association.
"Premises" means all of the real property
and improvements thereto, and personal property thereon, owned,
leased or operated by the Borrower and its Subsidiaries.
"Prime Rate" means the interest rate per
annum announced from time to time by the Agent as its prime
rate, which rate may not be the lowest rate of interest then
being charged by the Agent.
"Pro Rata Share(s)" means with respect to
each Bank the percentage set forth opposite such Bank's name as
shown in Subsection 1.1(b) hereof.
"RCRA" means the Resource Conservation and
Recovery Act, 42 U.S.C. Section 6901 et seq., as the same may be
amended and the regulations adopted pursuant thereto.
"Release(s)" means any release, spill,
discharge, leak or disposal of any substance which occurs in a
manner which is not in compliance with an Environmental Law.
"Reportable Event" means a Reportable Event
described in Section 4043(b) of ERISA, and 29 C.F.R. Part 2615
other than the events described in 29 C.F.R. Part 2615.18,
2615.19 and 2615.20; and other than an event described in 29
C.F.R. Part 2615.14 for which the 30-day notice to the PBGC is
waived.
"Revolving Credit Adjusted Euro-Rate" means
the interest rate relating to the Revolving Credit Euro-Rate
Option as described in item (ii) of Subsection 1.3(b)(1).
"Revolving Credit Base Rate" means the
interest rate relating to the Revolving Credit Base Rate Option
as described in item (i) of Subsection 1.3(b)(1). The Revolving
Credit Base Rate shall be adjusted automatically on the
effective date of any change in the Prime Rate.
"Revolving Credit Base Rate Option" means
the interest option described in item (i) of Subsection
1.3(b)(1).
"Revolving Credit Euro-Rate Option" means
the interest rate option described in item (ii) of Subsection
1.3(b)(1).
"Revolving Credit Commitment" means the
several undertakings by the Banks to make a Five Million
($5,000,000) Dollar revolving credit facility available to the
Borrower as set forth in Section 1.1 hereof.
"Revolving Credit Loan" means as to each
Bank the total aggregate advances to the Borrower by each Bank
pursuant to Section 1.1.
"Revolving Credit Loans" means collectively
the several Revolving Credit Loans advanced by the Banks.
"Revolving Credit Maturity Date" means the
earlier to occur of (i) October 29, 1995 or (ii) the date on
which the Revolving Credit Commitment is terminated and the
Revolving Credit Loans outstanding, if any, are declared due and
payable pursuant to Section 7.1.
"Revolving Credit Note" means any individual
promissory note of the Borrower evidencing Indebtedness of the
Borrower under the Revolving Credit Commitment, which note is
substantially in the form of Exhibit "A" to this Agreement and
all extensions, renewals, amendments, substitutions or
replacements of such promissory notes.
"Revolving Credit Notes" means collectively
the several promissory notes described in the immediately
preceding definition.
"Senior Officer(s)" means any Person holding
a title of Chairman of the Board, President, Chief Executive
Officer or Chief Financial Officer of the Borrower.
"Subsidiary" means any corporation of which
at least a majority of the outstanding stock having by the terms
thereof ordinary voting power to elect a majority of the Board
of Directors of such corporation is, at the time of
determination, directly or indirectly owned or controlled by the
Borrower or by one or more Subsidiaries and which, for financial
reporting purposes, is consolidated with the Borrower;
collectively "Subsidiaries".
"Term Adjusted Euro-Rate" means the interest
rate relating to the Term Euro-Rate Option as described in item
(ii) of Subsection 1.3(b)(2).
"Term Adjusted Euro-Rate Option" means the
interest rate option described in item (ii) of Subsection
1.3(b)(2).
"Term Base Rate" means the interest rate
relating to the Term Base Rate Option as described in item (i)
of Subsection 1.3(b)(2). The Term Base Rate shall be adjusted
automatically on the effective date of any change in the Prime
Rate.
"Term Base Rate Option" means the interest
option described in item (i) of Subsection 1.3(b)(2).
"Term Loan" means as to each Bank the
advances to the Borrower by each Bank pursuant to Section 1.2.
"Term Loans" means collectively the several
Term Loans advanced by the Banks.
"Term Maturity Date" means September 30,
1999.
"Term Note" means any individual promissory
note of the Borrower evidencing Indebtedness of the Borrower
under the Term Loans, which note is substantially in the form of
Exhibit "B" to this Agreement and all extensions, renewals,
amendments, substitutions or replacements of such promissory
notes.
"Term Notes" means collectively the several
promissory notes described in the immediately preceding
definition.
"Termination Event" means (i) a Reportable
Event with respect to a Plan or an event described in Section
4068(f) of ERISA with respect to a Plan, or (ii) the withdrawal
of the Borrower or any ERISA Affiliate from a Plan during a plan
year in which it was a "substantial employer", as such term is
defined in Section 4001(a)(2) of ERISA, or the incurrence of
liability by the Borrower or any ERISA Affiliate under Section
4064 of ERISA upon the termination of a Plan, or (iii) the
distribution of a notice of intent to terminate a Plan pursuant
to Section 4041(a)(2) of ERISA or the treatment of a Plan
amendment as a termination under Section 4041 of ERISA, or (iv)
the institution of proceedings to terminate a Plan by the PBGC
under Section 4042 of ERISA, or (v) any other event or condition
which might reasonably constitute grounds under Section 4042 of
ERISA for the termination of, or the appointment of a trustee to
administer, any Plan.
"Total Capitalization" means consolidated
stockholder equity of Borrower and the Subsidiaries plus
Consolidated Funded Debt.
"Valley" means One Valley Bank.
"Unfunded Benefit Liabilities" means, with
respect to any Plan, the excess of the accumulated benefit
obligations over the fair market value of the assets of the
Plan.
"Withdrawal Liability" has the meaning given
such term under Part 1 of Subtitle E of Title IV of ERISA;
collectively "Withdrawal Liabilities".
9.2 GAAP Definitions. Accounting terms used
herein but not defined herein shall have the meanings ascribed
to them under GAAP in effect on the date of this Agreement.
9.3 Other Definitional Conventions and Rules of
Construction. (i) The words "hereof", "herein" and "hereunder"
and words of similar import when used in this Agreement shall,
unless otherwise expressly specified, refer to this Agreement as
a whole and not to any particular provision of this Agreement,
and Article, Section and Subsection references are to this
Agreement unless otherwise expressly specified.
(ii) All terms defined in this
Agreement in the singular shall have comparable meanings when
used in plural, and vice versa, unless otherwise specified.
(iii) The word "or" as used herein
shall mean and connote nonexclusive alternatives, unless
expressly stated or the context clearly requires otherwise.
(iv) Captions, heading, and Article,
Section and Subsection references used in this Agreement are for
convenience only and shall not, and are not intended to, in any
way or manner affect the construction or interpretation or
define, limit or describe the scope or intent of this Agreement
or of any provisions or subdivisions hereof.
ARTICLE X. MISCELLANEOUS.
10.1 Non-Waiver. No delay on the part of the
Banks or the Agent in the exercise of any power or right shall
operate as a waiver thereof, nor shall any single or partial
exercise of any power or right preclude other or further
exercise thereof, or the exercise of any other power or right.
10.2 Amendments and Waivers. The terms,
conditions and covenants of this Agreement and the other Loan
Documents may only be amended or waived by a written document
executed by all Banks, the Agent and the Borrower. In the case
of any waiver, the Borrower, the Banks and the Agent shall be
restored to their former positions and rights, and any Event of
Default waived shall be deemed to be cured and not continuing,
but no such waiver shall extend to any subsequent or other Event
of Default, or impair any right consequent thereon.
10.3 Notices. (i) All notices required to be
sent to the Banks and the Agent shall be sent to the following
address, by hand delivery, overnight courier service, telegram,
telecopier or other means of electronic data communication or by
the United States mail, first class postage prepaid:
PNC and Agent:
PNC Bank, National Association
Two PNC Plaza
Second Floor
Pittsburgh, Pennsylvania 15265
Attention: Natural Resources Department
Telecopier: (412) 762-2784
Valley:
One Valley Bank, National Association
One Valley Square
Charleston, West Virginia 25301
Attention: William M. Kidd
Senior Vice President
Telecopier: (304) 348-7390
Such notices shall be effective three (3) days after mailing or
when received, whichever is earlier.
(ii) All notices required to be sent to the
Borrower shall be sent to the following address by hand
delivery, overnight courier service, telegram, telecopier or
other means of electronic data communication or by the United
States mail, first class postage prepaid:
Allegheny & Western Energy Corporation
300 Capitol Street, Suite 1600
Charleston, West Virginia 25301
Attention: W. Merwyn Pittman
Vice President of Finance,
Chief Financial Officer and
Treasurer
Telecopier: (304) 344-5358
Such notices shall be effective three (3) days after mailing or
when received, whichever is earlier.
(iii) The Borrower, each Bank and the Agent
may each change the address for service of notice upon it by a
notice in writing to the other parties hereto as provided in
this Section 10.3.
10.4 Certain Taxes. The Borrower agrees to pay,
and save the Banks and the Agent harmless from, all liability
for any stamp or other taxes which may be payable with respect
to the execution or delivery or issuance of this Agreement and
the other Loan Documents and the perfection of the security
interests granted hereunder, which obligation of the Borrower
shall survive the termination of this Agreement and the other
Loan Documents.
10.5 Holiday Payments. If any payments to be
made by the Borrower hereunder or under the other Loan Documents
shall become due on a date not a Business Day, such payments
shall be made on the next succeeding Business Day and such
extension of time shall be included in computing any interest in
respect of such payment.
10.6 Covenants to Survive. Until payment in full
of the Revolving Credit Notes and the Term Notes, all covenants,
agreements, warranties and representations made herein and in
the other Loan Documents, and in all certificates or other
documents delivered in connection with this Agreement and the
other Loan Documents, by or on behalf of the Borrower and
Mountaineer Gas Company and Gas Access Systems, Inc., shall
survive the advances of money made by the Banks to the Borrower
hereunder and the delivery of the Revolving Credit Notes and the
Term Notes, and all such covenants, agreements, warranties and
representations shall inure to the benefit of the respective
successors and assigns of the Banks and the Agent, whether or
not so expressed.
10.7 Applicable Law. THIS AGREEMENT AND THE
OTHER LOAN DOCUMENTS SHALL BE CONTRACTS MADE UNDER AND GOVERNED
BY THE LAWS OF THE COMMONWEALTH OF PENNSYLVANIA WITHOUT GIVING
EFFECT TO ITS CONFLICTS OF LAW PROVISIONS.
10.8 Consent to Jurisdiction. THE PARTIES HERETO
AGREE THAT ANY ACTION OR PROCEEDING ARISING OUT OF THIS
AGREEMENT OR THE OTHER LOAN DOCUMENTS SHALL BE COMMENCED IN THE
COURT OF COMMON PLEAS OF ALLEGHENY COUNTY, PENNSYLVANIA OR IN
THE DISTRICT COURT OF THE UNITED STATES FOR THE WESTERN DISTRICT
OF PENNSYLVANIA, OR AT THE OPTION OF THE BANKS AND THE AGENT,
ANY OTHER COURT LOCATED IN WEST VIRGINIA ("OTHER COURT") IN
WHICH THE BANKS AND/OR THE AGENT SHALL INITIATE ANY SUCH ACTION
OR PROCEEDING AND WHICH HAS SUBJECT MATTER JURISDICTION, AND
EACH PARTY AGREES THAT A SUMMONS AND COMPLAINT COMMENCING AN
ACTION OR PROCEEDING IN ANY SUCH COURT SHALL BE PROPERLY SERVED
AND SHALL CONFER PERSONAL JURISDICTION IF SERVED PERSONALLY OR
BY CERTIFIED MAIL TO IT AT ITS ADDRESS DESIGNATED PURSUANT
HERETO, OR AS OTHERWISE PROVIDED UNDER THE LAWS OF THE
COMMONWEALTH OF PENNSYLVANIA. FURTHER, THE BORROWER HEREBY
SPECIFICALLY CONSENTS TO THE PERSONAL JURISDICTION OF THE COURT
OF COMMON PLEAS OF ALLEGHENY COUNTY, PENNSYLVANIA AND THE
DISTRICT COURT OF THE UNITED STATES FOR THE WESTERN DISTRICT OF
PENNSYLVANIA AND THE OTHER COURT AND WAIVES AND HEREBY
ACKNOWLEDGES THAT IT IS ESTOPPED FROM RAISING ANY CLAIM THAT ANY
SUCH COURT LACKS PERSONAL JURISDICTION OVER IT SO AS TO PROHIBIT
ANY SUCH COURT FROM ADJUDICATING ANY ISSUES RAISED IN A
COMPLAINT FILED WITH ANY SUCH COURT AGAINST IT BY THE BANKS
AND/OR THE AGENT CONCERNING THIS AGREEMENT OR ANY OTHER LOAN
DOCUMENT OR THE BANK INDEBTEDNESS. THE PARTIES HERETO WAIVE ANY
CLAIM THAT PITTSBURGH, PENNSYLVANIA OR THE WESTERN DISTRICT OF
PENNSYLVANIA OR THE PLACE WHERE THE OTHER COURT IS LOCATED IS AN
INCONVENIENT FORUM AND ANY CLAIM THAT ANY ACTION OR PROCEEDING
ARISING OUT OF OR RELATING TO THE TRANSACTIONS CONTEMPLATED BY
THIS AGREEMENT AND THE OTHER LOAN DOCUMENTS IN ANY OF THE
AFOREMENTIONED COURTS LACKS PROPER VENUE.
10.9 Costs. The Borrower will pay all reasonable
out-of-pocket costs and expenses of the Banks (including without
limitation the fees and disbursements of counsel for each Bank)
in connection with the preparation, execution, delivery,
administration and enforcement of this Agreement and the other
Loan Documents.
10.10 Successors and Assigns. This Agreement shall be
binding upon the Borrower, the Banks and the Agent and their
respective successors and assigns, and shall inure to the
benefit of the Borrower, the Banks and the Agent and the
successors and assigns of the Banks and the Agent; provided,
however, that the Borrower may not assign any of its rights or
obligations hereunder without the prior written consent of all
the Banks.
10.11 Counterparts. This Agreement may be executed in
as many identical counterparts as may be convenient and by the
different parties hereto on separate counterparts. This
Agreement shall become binding when each Bank, the Agent and the
Borrower have executed at least one counterpart. Immediately
after the execution of counterparts and solely for the
convenience of the parties hereto, the Borrower and the Banks
will execute sufficient counterparts so that Borrower shall have
counterparts executed by it and each Bank and each Bank shall
have counterparts executed by the Borrower and all the Banks.
All counterparts shall constitute but one and the same
instrument.
10.12 Integration. This Agreement and the other Loan
Documents contain the entire agreement among the Borrower and
the Banks relating to the subject matter hereof; there are
merged herein and in the other Loan Documents all prior
representations, promises and conditions, whether oral or
written, in connection with the subject matter hereof and
thereof, and any representation, promise or condition not
incorporated herein, or in the other Loan Documents, shall not
be binding upon the Borrower or the Banks. Any exhibits and
schedules attached to this Agreement are an integral part hereof
and are hereby incorporated herein and included in the term
"this Agreement".
WITNESS the due execution hereof with the
intent to be legally bound hereby as of the date first written
above.
ATTEST: (SEAL) ALLEGHENY & WESTERN ENERGY
CORPORATION
By_____________________________ By____________________________
Richard L. Grant W. Merwyn Pittman
Secretary Vice President of
Finance, Chief Financial
Officer and Treasurer
WITNESS: PNC BANK, NATIONAL
ASSOCIATION, in its
capacities as a Bank and as
the Agent
______________________________ By___________________________
Name_________________________
Title________________________
WITNESS: ONE VALLEY BANK, NATIONAL
ASSOCIATION
______________________________ By___________________________
Name_________________________
Title________________________
Exhibit 27.1
FINANCIAL DATA SCHEDULE UT
PUBLIC UTILITY COMPANIES AND PUBLIC UTILITY HOLDING COMPANIES
[ARTICLE] UT
[LEGEND]
This schedule contains summary financial information extracted
from the Condensed Consolidated Balance Sheet as of December 31,
1994 and the Condensed Consolidated Statement of Income for the
Six Month Period Ended December 31, 1994, (000's except share
amount),and is qualified in its entirety by reference to such
financial statements.
[/LEGEND]
[MULTIPLIER] 1,000
[PERIOD-TYPE] 6-MOS
[FISCAL-YEAR-END] JUN-30-1994
[PERIOD-END] DEC-31-1994
[BOOK-VALUE] PER-BOOK
[TOTAL-NET-UTILITY-PLANT] 112,652
[OTHER-PROPERTY-AND-INVEST] 39,100
[TOTAL-CURRENT-ASSETS] 67,608
[TOTAL-DEFERRED-CHARGES] 14,662
[OTHER-ASSETS] 1,726
[TOTAL-ASSETS] 234,748
[COMMON] 81
[CAPITAL-SURPLUS-PAID-IN] 36,788
[RETAINED-EARNINGS] 70,221
[TOTAL-COMMON-STOCKHOLDERS-EQ] 101,808
[PREFERRED-MANDATORY] 0
[PREFERRED] 0
[LONG-TERM-DEBT-NET] 25,805
[SHORT-TERM-NOTES] 31,508
[LONG-TERM-NOTES-PAYABLE] 0
[COMMERCIAL-PAPER-OBLIGATIONS] 0
[LONG-TERM-DEBT-CURRENT-PORT] 6,050
[PREFERRED-STOCK-CURRENT] 0
[CAPITAL-LEASE-OBLIGATIONS] 0
[LEASES-CURRENT] 0
[OTHER-ITEMS-CAPITAL-AND-LIAB] 70,577
[TOT-CAPITALIZATION-AND-LIAB] 235,748
[GROSS-OPERATING-REVENUE] 81,389
[INCOME-TAX-EXPENSE] 61
[OTHER-OPERATING-EXPENSES] 78,829
[TOTAL-OPERATING-EXPENSES] 78,890
[OPERATING-INCOME-LOSS] 2,499
[OTHER-INCOME-NET] 170
[INCOME-BEFORE-INTEREST-EXPEN] 2,669
[TOTAL-INTEREST-EXPENSE] 2,521
[NET-INCOME] 148
[PREFERRED-STOCK-DIVIDENDS] 0
[EARNINGS-AVAILABLE-FOR-COMM] 148
[COMMON-STOCK-DIVIDENDS] 0
[TOTAL-INTEREST-ON-BONDS] 0
[CASH-FLOW-OPERATIONS] (5,483)
[EPS-PRIMARY] .02
[EPS-DILUTED] .0