Exhibit 10(c)
CREDIT AGREEMENT
among
PENNSYLVANIA POWER & LIGHT COMPANY,
THE LENDERS,
and
THE FIRST NATIONAL BANK OF CHICAGO,
Individually and as Agent
Dated as of March 14, 1996
TABLE OF CONTENTS
ARTICLE I. DEFINITIONS ................................................ 1
ARTICLE II. THE CREDITS ............................................... 8
2.1. Commitment ................................................. 8
2.2. Required Payments; Termination ............................. 9
2.3. Ratable Loans .............................................. 9
2.4. Types of Advances .......................................... 9
2.5. Minimum Amount of Each Advance ............................. 9
2.6. Optional Principal Payments ................................ 9
2.7. Method of Selecting Types and Interest Periods for
Initial Advances ........................................... 9
2.8. Conversion and Continuation of Advances .................... 10
2.9. Application of Interest Rates, etc. ........................ 10
2.10. Rates Applicable After Default ............................. 11
2.11. Method of Payment .......................................... 11
2.12. Telephonic Notices ......................................... 11
2.13. Interest Payment Dates; Interest Basis ..................... 12
2.14 Notification of Advances, Interest Rates, Prepayments
and Commitment Reductions .................................. 12
2.15. Lending Installations ...................................... 12
2.16. Non-Receipt of Funds by the Agent .......................... 13
2.17. Withholding Tax Exemption .................................. 13
ARTICLE III. CHANGE IN CIRCUMSTANCES .................................. 14
3.1. Yield Protection ........................................... 14
3.2. Changes in Capital Adequacy Regulations .................... 14
3.3. Availability of Types of Advances .......................... 15
3.4. Funding Indemnification .................................... 15
3.5. Lender Statements; Survival of Indemnity ................... 15
ARTICLE IV. CONDITIONS PRECEDENT ...................................... 16
ARTICLE V. REPRESENTATIONS AND WARRANTIES ............................. 17
5.1. Corporate Status ........................................... 17
5.2. Authority; No Conflict ..................................... 17
5.3. Legality, Etc. ............................................. 17
5.4. Financial Statements ....................................... 18
5.5. Litigation ................................................. 18
5.6. No Violation ............................................... 18
5.7. ERISA ...................................................... 18
5.8. Consents ................................................... 18
5.9. Subsidiaries ............................................... 18
5.10. Limitation Event ........................................... 19
5.11. Investment Company Act ..................................... 19
5.12. Public Utility Holding Company Act ......................... 19
ARTICLE VI. COVENANTS ................................................. 19
6.1. Financial Statements ....................................... 19
6.2. Mergers .................................................... 20
ARTICLE VII. DEFAULTS ................................................. 20
7.1. Representations, Etc. ...................................... 20
7.2. Principal and Interest ..................................... 20
7.3. Defaults Under Other Agreements............................. 20
7.4. Bankruptcy, Etc. ........................................... 21
7.5. Other Covenants ............................................ 21
ARTICLE VIII. AMENDMENTS; PRESERVATION OF RIGHTS ...................... 22
8.1. Amendments ................................................. 22
8.2. Preservation of Rights ..................................... 23
ARTICLE IX. GENERAL PROVISIONS ........................................ 23
9.1. Survival of Representations ................................ 23
9.2. Governmental Regulation .................................... 23
9.3. Taxes ...................................................... 23
9.4. Headings ................................................... 23
9.5. Entire Agreement ........................................... 24
9.6. Several Obligations; Benefits of this Agreement ............ 24
9.7. Expenses; Indemnification .................................. 24
9.8. Numbers of Documents ....................................... 24
9.9. Accounting ................................................. 24
9.10. Severability of Provisions ................................. 25
9.11. Nonliability of Lenders .................................... 25
9.12. Choice of Law .............................................. 25
9.13. Consent to Jurisdiction .................................... 25
9.14. Waiver of Jury Trial........................................ 26
9.15. Confidentiality ............................................ 26
ARTICLE X. THE AGENT .................................................. 26
10.1. Appointment ................................................ 26
10.2. Powers ..................................................... 26
10.3. General Immunity ........................................... 26
10.4. No Responsibility for Loans, Recitals, etc. ................ 26
10.5. Action on Instructions of Lenders .......................... 27
10.6. Employment of Agents and Counsel ........................... 27
10.7. Reliance on Documents; Counsel ............................. 27
10.8. Agent's Reimbursement and Indemnification .................. 27
10.9. Rights as a Lender ......................................... 28
10.10. Lender Credit Decision ..................................... 28
10.11. Successor Agent ............................................ 28
10.12. Agent's Fee ................................................ 29
ARTICLE XI. SETOFF; RATABLE PAYMENTS .................................. 29
11.1. Setoff ..................................................... 29
11.2. Ratable Payments ........................................... 29
ARTICLE XII. BENEFIT OF AGREEMENT; ASSIGNMENTS; PARTICIPATIONS ........ 30
12.1. Successors and Assigns ..................................... 30
12.2. Participations.............................................. 30
12.2.1. Permitted Participants; Effect .................... 30
12.2.2. Voting Rights ..................................... 31
12.2.3. Benefit of Setoff ................................. 31
12.3. Assignments ................................................ 31
12.3.1. Permitted Assignments ............................. 31
12.3.2. Effect; Effective Date ............................ 31
12.4. Dissemination of Information ............................... 32
12.5. Tax Treatment .............................................. 32
ARTICLE XIII. NOTICES ................................................. 33
13.1. Giving Notice .............................................. 33
13.2. Change of Address .......................................... 33
ARTICLE XIV. COUNTERPARTS ............................................. 33
EXHIBITS
EXHIBIT "A" - Note .................................................... 38
EXHIBIT "B" - Form of Opinion ......................................... 40
EXHIBIT "C" - Officer' Certificate ................................... 42
EXHIBIT "D" - Assignment Agreement .................................... 43
EXHIBIT "E" - Loan/credit Related Money Transfer Instruction .......... 54
PENNSYLVANIA POWER & LIGHT COMPANY
TERM CREDIT AGREEMENT
This Agreement, dated as of March 14, 1996, is among Pennsylvania Power
& Light Company, the Lenders and The First National Bank of Chicago, as Agent.
The parties hereto agree as follows:
ARTICLE I
DEFINITIONS
As used in this Agreement:
"Advance" means, with respect to the Borrowing, a portion of the
Borrowing accruing interest at a certain set or designated Rate Option and, in
the case of a Eurodollar Advance, for a certain set or designated Interest
Period.
"Affiliate" of any Person means any other Person directly or indirectly
controlling, controlled by or under common control with such Person. A Person
shall be deemed to control another Person if the controlling Person owns 10%
or more of any class of voting securities (or other ownership interests) of
the controlled Person or possesses, directly or indirectly, the power to
direct or cause the direction of the management or policies of the controlled
Person, whether through ownership of stock, by contract or otherwise.
"Agent" means The First National Bank of Chicago in its capacity as
agent for the Lenders pursuant to Article X, and not in its individual
capacity as a Lender, and any successor Agent appointed pursuant to Article X.
"Aggregate Commitment" means the aggregate of the Commitments of all the
Lenders, as reduced from time to time pursuant to the terms hereof.
"Agreement" means this term credit agreement, as it may be amended or
modified and in effect from time to time.
"Alternate Base Rate" means, for any day, a rate of interest per annum
equal to the higher of (i) the Corporate Base Rate for such day or (ii) the
sum of the Federal Funds Effective Rate for such day plus 1/2% per annum.
"Applicable Margin" means:
(I) from the date of this Agreement through the third anniversary
thereof (a) at all times that the Borrower's First Mortgage Bond
ratings are at Level I, .35%; (b) at all times that the Borrower's
First Mortgage Bond ratings are at Level II, .40%; (c) at all
times that the Borrower's First Mortgage Bond ratings are at Level
III, .45%; (d) at all times that the Borrower's First Mortgage
Bond ratings are at Level IV, .55%; and (e) at all times that the
Borrower's First Mortgage Bond ratings are at Level V, .80%; and
(II) after the third anniversary of the date of this Agreement (a) at
all times that the Borrower's First Mortgage Bond ratings are at
Level I, .45%; (b) at all times that the Borrower's First Mortgage
Bond ratings are at Level II, .50%; (c) at all times that the
Borrower's First Mortgage Bond ratings are at Level III, .55%; (d)
at all times that the Borrower's First Mortgage Bond ratings are
at Level IV, .65%; and (e) at all times that the Borrower's First
Mortgage Bond ratings are at Level V, .90%.
Each change in the Applicable Margin resulting from a change in the rating of
the Borrower's First Mortgage Bonds by either rating agency shall take effect
at the time such change in such rating is publicly announced by the relevant
rating agency. At all times when either the Borrower has no First Mortgage
Bonds or the Borrower's First Mortgage Bonds are not rated, the Borrower
shall be deemed to be at Level V.
"Article" means an article of this Agreement unless another document is
specifically referenced.
"Authorized Officer" means any of the Senior Vice President-Financial,
Vice President-Finance, or Treasurer of the Borrower or any other Person
designated in writing by the Treasurer of the Borrower, acting singly.
"Borrower" means Pennsylvania Power & Light Company, a Pennsylvania
corporation, and its permitted successors and assigns.
"Borrowing" means the single borrowing made pursuant to Section 2.1 of
this Agreement, consisting of the aggregate of the several extensions of
credit provided by the Lenders, which borrowing bears interest at the
Eurodollar Rate or the Floating Rate, or a combination thereof, as selected by
the Borrower pursuant to Sections 2.7 and 2.8.
"Borrowing Date" means the date on which the Borrowing is made
hereunder.
"Borrowing Notice" is defined in Section 2.7.
"Business Day" means (i) with respect to any borrowing, payment or rate
selection of Eurodollar Advances, a day (other than a Saturday or Sunday) on
which banks generally are open in Chicago and New York for the conduct of
substantially all of their commercial lending activities and on which dealings
in United States dollars are carried on in the London interbank market and
(ii) for all other purposes, a day (other than a Saturday or Sunday) on which
banks generally are open in Chicago for the conduct of substantially all of
their commercial lending activities.
"Code" means the Internal Revenue Code of 1986, as amended, reformed or
otherwise modified from time to time.
"Commitment" means, for each Lender, the obligation of such Lender to
make Loans not exceeding the amount set forth opposite its signature below or
as set forth in any Notice of Assignment relating to any assignment that has
become effective pursuant to Section 12.3.2, as such amount may be modified
from time to time pursuant to the terms hereof.
"Conversion/Continuation Notice" is defined in Section 2.8.
"Corporate Base Rate" means a rate per annum equal to the corporate base
rate of interest announced by First Chicago from time to time, changing when
and as said corporate base rate changes.
"Default" means an event described in Article VII.
"Disclosure Documents" means, collectively, the Borrower's (i) Annual
Report to the SEC on Form 10-K for the year 1994; (ii) Quarterly Reports to
the SEC on Form 10-Q for the quarterly periods ended March 31, 1995, June 30,
1995, and September 30, 1995; (iii) Periodic Reports filed subsequent to the
Borrower's Annual Report described in clause (i) above but prior to the the
date of this Agreement; and (iv) if available to the Agent and the Lenders
prior to the date of this Agreement, Annual Report to the SEC on Form 10-K for
the year 1995.
"ERISA" means the Employee Retirement Income Security Act of 1974, as
amended from time to time, and any rule or regulation issued thereunder.
"Eurodollar Advance" means an Advance which bears interest at a
Eurodollar Rate.
"Eurodollar Base Rate" means, with respect to a Eurodollar Advance for
the relevant Interest Period, the rate determined by the Agent to be the
arithmetic average of the rates reported to the Agent by each Reference Bank
as the rate at which deposits in U.S. dollars are offered by such Reference
Bank to first-class banks in the London interbank market at approximately
11 a.m. (London time) two Business Days prior to the first day of such
Interest Period, in the approximate amount of such Reference Bank's relevant
Eurodollar Loan and having a maturity approximately equal to such Interest
Period. If any Reference Bank fails to provide such quotation to the Agent,
then the Agent shall determine the Eurodollar Base Rate on the basis of the
quotations of the remaining Reference Bank(s).
"Eurodollar Loan" means a Loan which bears interest at a Eurodollar
Rate.
"Eurodollar Rate" means, with respect to a Eurodollar Advance for the
relevant Interest Period, a rate per annum equal to the sum of (i) the
quotient of (a) the Eurodollar Base Rate applicable to such Interest Period,
divided by (b) one minus the Reserve Requirement (expressed as a decimal)
applicable to such Interest Period, if any, plus (ii) the Applicable Margin.
The Eurodollar Rate shall be rounded to the next higher multiple of 1/16 of 1%
if the rate is not such a multiple.
"Facility Termination Date" means March 14, 2001.
"Federal Funds Effective Rate" means, for any day, an interest rate per
annum equal to the weighted average of the rates on overnight Federal funds
transactions with members of the Federal Reserve System arranged by Federal
funds brokers on such day, as published for such day (or, if such day is not a
Business Day, for the immediately preceding Business Day) by the Federal
Reserve Bank of New York, or, if such rate is not so published for any day
which is a Business Day, the average of the quotations at approximately 10
a.m. (Chicago time) on such day on such transactions received by the Agent
from three Federal funds brokers of recognized standing selected by the Agent
in its sole discretion.
"First Chicago" means The First National Bank of Chicago in its
individual capacity, and its successors.
"Floating Rate" means, for any day, a rate per annum equal to the
Alternate Base Rate for such day, changing when and as the Alternate Base Rate
changes.
"Floating Rate Advance" means an Advance which bears interest at the
Floating Rate.
"Floating Rate Loan" means a Loan which bears interest at the Floating
Rate.
"Interest Period" means, with respect to a Eurodollar Advance, a period
of one, two, three, or six months commencing on a Business Day selected by the
Borrower pursuant to this Agreement. Such Interest Period shall end on (but
exclude) the day which corresponds numerically to such date one, two, three,
or six months thereafter, provided, however, that if there is no such
numerically corresponding day in such next, second, third, or sixth succeeding
month, such Interest Period shall end on the last Business Day of such next,
second, third, or sixth succeeding month. If an Interest Period would
otherwise end on a day which is not a Business Day, such Interest Period shall
end on the next succeeding Business Day, provided, however, that if said next
succeeding Business Day falls in a new calendar month, such Interest Period
shall end on the immediately preceding Business Day.
"Lenders" means the lending institutions listed on the signature pages
of this Agreement and their respective successors and assigns.
"Lending Installation" means, with respect to a Lender or the Agent, any
office, branch, subsidiary or affiliate of such Lender or the Agent.
"Letter of Credit" of a Person means a letter of credit or similar
instrument which is issued upon the application of such Person or upon which
such Person is an account party or for which such Person is in any way liable.
"Level" means any of Level I, Level II, Level III, Level IV, or Level V.
"Level I" means, with respect to the Borrower's First Mortgage Bonds, a
rating equal to or better than A- from S&P or A3 from Moody's.
"Level II" means, with respect to the Borrower's First Mortgage Bonds, a
rating equal to or better than BBB+ from S&P or Baa1 from Moody's but less
than a rating that would place the Borrower at Level I.
"Level III" means, with respect to the Borrower's First Mortgage Bonds,
a rating equal to or better than BBB from S&P or Baa2 from Moody's but less
than a rating that would place the Borrower at Level I or Level II.
"Level IV" means, with respect to the Borrower's First Mortgage Bonds, a
rating equal to or better than BBB- from S&P or Baa3 from Moody's but less
than a rating that would place the Borrower at Level I, Level II or Level III.
"Level V" means, with respect to the Borrower's First Mortgage Bonds, a
rating equal to or lower than BB+ from S&P and Ba1 from Moody's.
"Limitation Event" shall mean and include each of the following:
(1) A nuclear incident (as that term is defined in 42 U.S.C.
Section 2014 or any similar statute enacted in its place) involving or
connected in any way with any facility of the Borrower utilizing nuclear
fuel or any portion thereof shall have occurred, which nuclear incident
may give rise to an aggregate liability, or to damage, destruction or
personal injury, in excess of $50,000,000; or
(2) Any facility of the Borrower utilizing nuclear fuel cannot be
(in the good faith determination of the Borrower) used by the Borrower
for a period of 12 months because (i) a necessary license or other
necessary public authorization, order, consent or approval cannot be
obtained or is revoked, withheld or suspended, (ii) the utilization of
such license, authorization, order, consent or approval is made subject
to specified conditions which cannot be met, (iii) an injunction has
been entered enjoining the operation or materially impairing the use of
such facility or (iv) such facility has suffered substantial damage
(including, without limitation, contamination); or
(3) There shall have occurred a loss of the title to, ownership
of, or use and possession of, any facility of the Borrower utilizing
nuclear fuel, or any substantial portion of such facility, as the result
of, or in anticipation of, the exercise of any right of condemnation or
eminent domain pursuant to any law, general or special, or by reason of
the temporary or permanent requisition of such facility by any
governmental authority (civil or military).
"Loan" means, with respect to an individual Lender, the portion of an
Advance to be provided by such Lender, calculated by multiplying the amount of
such Advance by a percentage representing the ratio such Lender's Commitment
bears to the Aggregate Commitment.
"Loan Documents" means this Agreement and the Notes.
"Moody's" means Moody's Investors Service, Inc., or any successor
thereto.
"Note" means a promissory note, in substantially the form of Exhibit "A"
hereto, duly executed by the Borrower and payable to the order of a Lender in
the amount of its Commitment, including any amendment, modification, renewal
or replacement of such promissory note.
"Notice of Assignment" is defined in Section 12.3.2.
"Obligations" means all unpaid principal of and accrued and unpaid
interest on the Notes, all accrued and unpaid fees and all expenses,
reimbursements, indemnities and other obligations of the Borrower to the
Lenders or to any Lender, the Agent or any indemnified party hereunder arising
under the Loan Documents.
"Officer's Certificate" means a certificate, in substantially the form
of Exhibit "C" hereto, duly executed by the Treasurer or another principal
financial officer of the Borrower.
"Participants" is defined in Section 12.2.1.
"Payment Date" means the last day of each March, June, September and
December.
"Person" means any natural person, corporation, firm, joint venture,
partnership, association, enterprise, trust or other entity or organization,
or any government or political subdivision or any agency, department or
instrumentality thereof.
"Property" of a Person means any and all property, whether real,
personal, tangible, intangible, or mixed, of such Person, or other assets
owned, leased or operated by such Person.
"Purchasers" is defined in Section 12.3.1.
"Rate Option" means the Eurodollar Rate or the Floating Rate.
"Reference Banks" means First Chicago, Credit Suisse, and The Bank of
New York.
"Regulation D" means Regulation D of the Board of Governors of the
Federal Reserve System as from time to time in effect and any successor
thereto or other regulation or official interpretation of said Board of
Governors relating to reserve requirements applicable to member banks of the
Federal Reserve System.
"Required Lenders" means Lenders in the aggregate having at least 66_%
of the Aggregate Commitment or, if the Aggregate Commitment has been
terminated, Lenders in the aggregate holding at least 66_% of the aggregate
unpaid principal amount of the outstanding Advances.
"Reset Date" means the effective date of a conversion or continuation of
an Advance pursuant to Section 2.8, which shall be the effective date that a
Rate Option and, with respect to a Eurodollar Advance, Interest Period of an
Advance are set or designated under this Agreement.
"Reserve Requirement" means, with respect to an Interest Period, the
maximum aggregate reserve requirement (including all basic, supplemental,
marginal and other reserves) which is imposed under Regulation D on
Eurocurrency liabilities (as defined therein).
"S&P" means Standard & Poor's Ratings Group, a division of McGraw-Hill,
Inc., or any successor thereto.
"SEC" means the Securities and Exchange Commission.
"Section" means a numbered section of this Agreement, unless another
document is specifically referenced.
"Subsidiary" of a Person means (i) any corporation more than 50% of the
outstanding securities having ordinary voting power of which shall at the time
be owned or controlled, directly or indirectly, by such Person or by one or
more of its Subsidiaries or by such Person and one or more of its
Subsidiaries, or (ii) any partnership, association, joint venture or similar
business organization more than 50% of the ownership interests having ordinary
voting power of which shall at the time be so owned or controlled. Unless
otherwise expressly provided, all references herein to a "Subsidiary" shall
mean a Subsidiary of the Borrower.
"Transferee" is defined in Section 12.4.
"Type" means, with respect to any Advance, its nature as a Floating Rate
Advance or a Eurodollar Advance.
"Unmatured Default" means an event which but for the lapse of time or
the giving of notice, or both, would constitute a Default.
"Wholly-Owned Subsidiary" of a Person means (i) any Subsidiary all of
the outstanding voting securities of which shall at the time be owned or
controlled, directly or indirectly, by such Person or one or more Wholly-Owned
Subsidiaries of such Person, or by such Person and one or more Wholly-Owned
Subsidiaries of such Person, or (ii) any partnership, association, joint
venture or similar business organization 100% of the ownership interests
having ordinary voting power of which shall at the time be so owned or
controlled.
The foregoing definitions shall be equally applicable to both the
singular and plural forms of the defined terms.
ARTICLE II
THE CREDITS
2.1. Commitment. Each Lender severally agrees, on the terms and
conditions set forth in this Agreement, to make extensions of credit to the
Borrower on the Borrowing Date in the form of loans in amounts not to exceed
in the aggregate the amount of its Commitment. Upon the making of the initial
Advances comprising the Borrowing hereunder and at all times thereafter, the
Commitment of each Lender shall automatically reduce to the amount of Loans by
such Lender then outstanding. The Borrower will use the proceeds of the
Borrowing to refinance the principal and related call premium on the
Borrower's $40,000,000 principal amount of 8.125% First Mortgage Bonds due
June 1999 and $75,000,000 principal amount of 7.625% First Mortgage Bonds due
2002 and to pay expenses related to such refinancing. The Commitments to lend
hereunder shall expire on the Facility Termination Date. Principal payments
made hereunder may not be reborrowed.
2.2. Required Payments; Termination. Any outstanding Advances and all
other unpaid Obligations shall be paid in full by the Borrower on the Facility
Termination Date.
2.3. Ratable Loans. Each Advance hereunder shall consist of Loans
made from the several Lenders ratably in proportion to the ratio that their
respective Commitments bear to the Aggregate Commitment.
2.4. Types of Advances. The Advances may be Floating Rate Advances,
Eurodollar Advances, or a combination thereof, selected by the Borrower in
accordance with Sections 2.7 and 2.8.
2.5. Minimum Amount of Each Advance. Each Advance shall be in the
minimum amount of $5,000,000 (and in multiples of $1,000,000 if in excess
thereof), provided, however, that any Floating Rate Advance may be in the
amount of the unutilized Aggregate Commitment.
2.6. Optional Principal Payments. The Borrower may from time to time
pay, without penalty or premium, all outstanding Floating Rate Advances, or,
in a minimum aggregate amount of $5,000,000 or any integral multiple of
$1,000,000 in excess thereof, any portion of the outstanding Floating Rate
Advances upon one Business Day's prior notice to the Agent. The Borrower may
from time to time pay all outstanding Eurodollar Advances, or, in a minimum
aggregate amount of $5,000,000 or any integral multiple of $1,000,000 in
excess thereof, any portion of the outstanding Eurodollar Advances upon three
Business Days' prior notice to the Agent, subject to Section 3.4.
2.7. Method of Selecting Types and Interest Periods for Initial
Advances. The Borrower shall select the Rate Option and, in the case of each
Eurodollar Advance, the Interest Period applicable on the Borrowing Date to
each initial Advance. The Borrower shall give the Agent irrevocable notice (a
"Borrowing Notice") not later than 10:00 a.m. (Chicago time) at least one
Business Day before the Borrowing Date for each Floating Rate Advance and
three Business Days before the Borrowing Date for each Eurodollar Advance,
specifying:
(i) the Borrowing Date, which shall be a Business Day,
(ii) the aggregate amount of such Advance,
(iii) the Rate Option selected for such Advance, and
(iv) in the case of each Eurodollar Advance, the Interest Period
applicable thereto.
Not later than noon (Chicago time) on the Borrowing Date, each Lender shall
make available its Loan or Loans, in funds immediately available in Chicago to
the Agent at its address specified pursuant to Article XIII. The Agent will
make the funds so received from the Lenders available to the Borrower at the
Agent's aforesaid address.
2.8. Conversion and Continuation of Advances. Floating Rate Advances
shall continue as Floating Rate Advances unless and until such Floating Rate
Advances are converted into Eurodollar Advances. Each Eurodollar Advance
shall continue as a Eurodollar Advance until the end of the then applicable
Interest Period therefor, at which time such Eurodollar Advance shall be
automatically converted into a Floating Rate Advance unless the Borrower shall
have given the Agent a Conversion/Continuation Notice requesting that, at the
end of such Interest Period, such Eurodollar Advance either continue as a
Eurodollar Advance for the same or another Interest Period or be converted
into a Floating Rate Advance. Subject to the terms of Section 2.5, the
Borrower may elect from time to time to convert all or any part of an Advance
of any Type into any other Type (or, if more than one, Types) of Advances;
provided that any conversion of any Eurodollar Advance shall be made on, and
only on, the last day of the Interest Period applicable thereto. The Borrower
shall give the Agent irrevocable notice (a "Conversion/Continuation Notice")
of each conversion of an Advance or continuation of a Eurodollar Advance not
later than 10:00 a.m. (Chicago time) at least one Business Day, in the case of
a conversion into a Floating Rate Advance, or three Business Days, in the case
of a conversion into or continuation of a Eurodollar Advance, prior to the
requested Reset Date, specifying:
(i) the Reset Date for such existing Advance, which shall be a
Business Day;
(ii) the aggregate amount of and Rate Option for the Advance which is
to be converted or continued; and
(iii) the amount(s) of new Advance(s) and Rate Option(s) into which
such existing Advance is to be converted or continued and, in
the case of a conversion into or continuation of a Eurodollar
Advance, the duration of the Interest Period applicable thereto.
2.9. Application of Interest Rates, etc. Each Floating Rate Advance
shall bear interest on the outstanding principal amount thereof, for each day
from and including the date such Advance is made or is converted from a
Eurodollar Advance into a Floating Rate Advance pursuant to Section 2.8 to but
excluding the date it becomes due or is converted into a Eurodollar Advance
pursuant to Section 2.8 hereof, at a rate per annum equal to the Floating Rate
for such day. Changes in the rate of interest on that portion of any Advance
maintained as a Floating Rate Advance will take effect simultaneously with
each change in the Alternate Base Rate. Each Eurodollar Advance shall bear
interest from and including the first day of the Interest Period applicable
thereto to (but not including) the last day of such Interest Period at the
interest rate determined as applicable to such Eurodollar Advance. No
Interest Period may end after the Facility Termination Date.
2.10. Rates Applicable After Default. Notwithstanding anything to the
contrary contained in Section 2.7 or 2.8, during the continuance of a Default
or Unmatured Default the Required Lenders may, at their option, by notice to
the Borrower (which notice may be revoked at the option of the Required
Lenders notwithstanding any provision of Section 8.2 requiring unanimous
consent of the Lenders to changes in interest rates), declare that no Advance
may be made as, converted into or continued as a Eurodollar Advance. During
the continuance of a Default the Required Lenders may, at their option, by
notice to the Borrower (which notice may be revoked at the option of the
Required Lenders notwithstanding any provision of Section 8.2 requiring
unanimous consent of the Lenders to changes in interest rates), declare that
(i) each Eurodollar Advance shall bear interest for the remainder of the
applicable Interest Period at the rate otherwise applicable to such Interest
Period plus 2% per annum and (ii) each Floating Rate Advance shall bear
interest at a rate per annum equal to the Floating Rate otherwise applicable
to the Floating Rate Advance plus 2% per annum.
2.11. Method of Payment. All payments of the Obligations hereunder
shall be made, without setoff, deduction, or counterclaim, in immediately
available funds to the Agent at the Agent's address specified pursuant to
Article XIII, or at any other Lending Installation of the Agent specified in
writing by the Agent to the Borrower, by noon (local time) on the date when
due and shall be applied ratably by the Agent among the Lenders. Each payment
delivered to the Agent for the account of any Lender shall be delivered
promptly by the Agent to such Lender in the same type of funds that the Agent
received at its address specified pursuant to Article XIII or at any Lending
Installation specified in a notice received by the Agent from such Lender.
The Agent is hereby authorized to charge the account of the Borrower
maintained with First Chicago for each payment of principal, interest and fees
as it becomes due hereunder.
2.12. Telephonic Notices. The Borrower hereby authorizes the Lenders
and the Agent to extend, convert or continue Advances, effect selections of
Types of Advances and Rate Options and to transfer funds based on telephonic
notices made by any Authorized Officer. The Borrower agrees to deliver
promptly to the Agent a written confirmation, if such confirmation is
requested by the Agent or any Lender, of each telephonic notice signed by an
Authorized Officer. If the written confirmation differs in any material
respect from the action taken by the Agent and the Lenders, the records of the
Agent and the Lenders shall govern absent manifest error.
2.13. Interest Payment Dates; Interest Basis. Interest accrued on
each Floating Rate Advance shall be payable on each Payment Date, commencing
with the first such date to occur after the date hereof, on any date on which
the Floating Rate Advance is prepaid, whether due to acceleration or
otherwise, and at maturity. Interest accrued on that portion of the
outstanding principal amount of any Floating Rate Advance converted into a
Eurodollar Advance on a day other than a Payment Date shall be payable on the
date of conversion. Interest accrued on each Eurodollar Advance shall be
payable on the last day of its applicable Interest Period, on any date on
which the Eurodollar Advance is prepaid, whether by acceleration or otherwise,
and at maturity. Interest accrued on each Eurodollar Advance having an
Interest Period longer than three months shall also be payable on the last day
of each three-month interval during such Interest Period. Interest on
Floating Rate Advances shall be calculated for actual days elapsed on the
basis of a 365- or 366-day year, as appropriate. Interest on Eurodollar
Advances shall be calculated for actual days elapsed on the basis of a 360-day
year. Interest shall be payable for the day an Advance is made but not for
the day of any payment on the amount paid if payment is received prior to noon
(local time) at the place of payment. If any payment of principal of or
interest on an Advance shall become due on a day which is not a Business Day,
such payment shall be made on the next succeeding Business Day and, in the
case of a principal payment, such extension of time shall be included in
computing interest in connection with such payment.
2.14. Notification of Advances, Interest Rates, Prepayments and
Commitment Reductions. Promptly after receipt thereof, the Agent will notify
each Lender of the contents of each Borrowing Notice, Conversion/Continuation
Notice, and repayment notice received by it hereunder. The Agent will notify
each Lender of the interest rate applicable to each Eurodollar Advance
promptly upon determination of such interest rate and will give each Lender
prompt notice of each change in the Alternate Base Rate. Each Reference Bank
agrees to furnish timely information for the purpose of determining the
Eurodollar Rate.
2.15. Lending Installations. Each Lender may book its Loans at any
Lending Installation selected by such Lender and may change the Lending
Installation at which it books its Loans from time to time. All terms of this
Agreement shall apply to any such Lending Installation and the Notes shall be
deemed held by each Lender for the benefit of such Lending Installation. Each
Lender may, by written or telex notice to the Agent and the Borrower,
designate a Lending Installation through which Loans will be made by it and
for whose account Loan payments are to be made. Each Lender shall use its
best efforts to minimize any additional cost (if any) to the Borrower as a
result of a change of Lending Installation (including, if appropriate, a
return to a prior Lending Installation at such time as the circumstances
giving rise to a change of Lending Installation are no longer in effect), but
no Lender shall be required to take or omit to take any action which action or
omission would be economically or legally disadvantageous to such Lender.
2.16. Non-Receipt of Funds by the Agent. Unless the Borrower or a
Lender, as the case may be, notifies the Agent prior to the date on which it
is scheduled to make payment to the Agent of (i) in the case of a Lender, the
proceeds of a Loan or (ii) in the case of the Borrower, a payment of
principal, interest or fees to the Agent for the account of the Lenders, that
it does not intend to make such payment, the Agent may assume that such
payment has been made. The Agent may, but shall not be obligated to, make the
amount of such payment available to the intended recipient in reliance upon
such assumption. If such Lender or the Borrower, as the case may be, has not
in fact made such payment to the Agent, the recipient of such payment shall,
on demand by the Agent, repay to the Agent the amount so made available
together with interest thereon in respect of each day during the period
commencing on the date such amount was so made available by the Agent until
the date the Agent recovers such amount at a rate per annum equal to (i) in
the case of payment by a Lender, the Federal Funds Effective Rate for such day
or (ii) in the case of payment by the Borrower, the interest rate applicable
to the relevant Loan.
2.17. Withholding Tax Exemption. At least five Business Days prior to
the first date on which interest or fees are payable hereunder for the account
of any Lender, each Lender that is not incorporated under the laws of the
United States of America, or a state thereof, agrees that it will deliver to
each of the Borrower and the Agent two duly completed copies of United States
Internal Revenue Service Form 1001 or 4224, certifying in either case that
such Lender is entitled to receive payments under this Agreement and the Notes
without deduction or withholding of any United States federal income taxes.
Each Lender which so delivers a Form 1001 or 4224 further undertakes to
deliver to each of the Borrower and the Agent two additional copies of such
form (or a successor form) on or before the date that such form expires
(currently, three successive calendar years for Form 1001 and one calendar
year for Form 4224) or becomes obsolete or after the occurrence of any event
requiring a change in the most recent forms so delivered by it, and such
amendments thereto or extensions or renewals thereof as may be reasonably
requested by the Borrower or the Agent, in each case certifying that such
Lender is entitled to receive payments under this Agreement and the Notes
without deduction or withholding of any United States federal income taxes,
unless an event (including without limitation any change in treaty, law or
regulation) has occurred prior to the date on which any such delivery would
otherwise be required which renders all such forms inapplicable or which would
prevent such Lender from duly completing and delivering any such form with
respect to it and such Lender advises the Borrower and the Agent that it is
not capable of receiving payments without any deduction or withholding of
United States federal income tax. Any such Lender that fails to provide
appropriate forms or other documents to the Borrower and the Agent in
accordance with this Section 2.17 agrees to indemnify the Borrower and the
Agent in full for any costs, fines, penalties, or other liabilities imposed on
either the Borrower or the Agent, or both, for any failure to withhold taxes.
ARTICLE III
CHANGE IN CIRCUMSTANCES
3.1. Yield Protection. If any change after the date of this Agreement
in any law or any governmental or quasi-governmental rule, regulation, policy,
guideline or directive (whether or not having the force of law), or any
interpretation thereof, or the compliance of any Lender therewith,
(i) subjects any Lender or any applicable Lending Installation to any
tax, duty, charge or withholding on or from payments due from
the Borrower (excluding taxation of the overall net income of
any Lender or applicable Lending Installation), or changes the
basis of taxation of payments to any Lender in respect of its
Loans or other amounts due it hereunder, or
(ii) imposes or increases or deems applicable any reserve,
assessment, insurance charge, special deposit or similar
requirement against assets of, deposits with or for the account
of, or credit extended by, any Lender or any applicable Lending
Installation (other than reserves and assessments taken into
account in determining interest rates applicable to Eurodollar
Advances), or
(iii) imposes any other condition the result of which is to increase
the cost to any Lender or any applicable Lending Installation of
making, funding or maintaining loans or reduces any amount
receivable by any Lender or any applicable Lending Installation
in connection with loans, or requires any Lender or any
applicable Lending Installation to make any payment calculated
by reference to the amount of loans held or interest received by
it, by an amount deemed material by such Lender,
then, within 15 days of demand by such Lender, the Borrower shall pay such
Lender that portion of such increased expense incurred or reduction in an
amount received which such Lender determines is attributable to making,
funding and maintaining its Loans and its Commitment.
3.2. Changes in Capital Adequacy Regulations. If a Lender determines
the amount of capital required or expected to be maintained by such Lender,
any Lending Installation of such Lender or any corporation controlling such
Lender is increased as a result of a Change, then, within 15 days of demand by
such Lender, the Borrower shall pay such Lender the amount necessary to
compensate for any shortfall in the rate of return on the portion of such
increased capital which such Lender determines is attributable to this
Agreement, its Loans or its obligation to make Loans hereunder (after taking
into account such Lender's policies as to capital adequacy). "Change" means
(i) any change after the date of this Agreement in the Risk-Based Capital
Guidelines or (ii) any adoption of or change in any other law, governmental or
quasi-governmental rule, regulation, policy, guideline, interpretation, or
directive (whether or not having the force of law) after the date of this
Agreement which affects the amount of capital required or expected to be
maintained by any Lender or any Lending Installation or any corporation
controlling any Lender. "Risk-Based Capital Guidelines" means (i) the risk-
based capital guidelines in effect in the United States on the date of this
Agreement, including transition rules, and (ii) the corresponding capital
regulations promulgated by regulatory authorities outside the United States
implementing the July 1988 report of the Basle Committee on Banking Regulation
and Supervisory Practices Entitled "International Convergence of Capital
Measurements and Capital Standards," including transition rules, and any
amendments to such regulations adopted prior to the date of this Agreement.
3.3. Availability of Types of Advances. If any Lender determines that
maintenance of its Eurodollar Loans at a suitable Lending Installation would
violate any applicable law, rule, regulation, or directive, whether or not
having the force of law, or if the Required Lenders determine that (i)
deposits of a type and maturity appropriate to match fund Eurodollar Advances
are not available or (ii) the interest rate applicable to a Type of Advance
does not accurately reflect the cost of making or maintaining such Advance,
then the Agent shall suspend the availability of the affected Type of Advance
and require any Eurodollar Advances to be converted to Floating Rate Advances.
3.4. Funding Indemnification. If any payment of a Eurodollar Advance
occurs on a date which is not the last day of the applicable Interest Period,
whether because of acceleration, prepayment or otherwise, or a Eurodollar
Advance is not made on the date specified by the Borrower for any reason other
than default by one or more of the Lenders, the Borrower will indemnify each
Lender for any loss or cost incurred by it resulting therefrom, including,
without limitation, any loss or cost in liquidating or employing deposits
acquired to fund or maintain such Eurodollar Advance.
3.5. Lender Statements; Survival of Indemnity. To the extent
reasonably possible, each Lender shall designate an alternate Lending
Installation with respect to its Eurodollar Loans to reduce any liability of
the Borrower to such Lender under Sections 3.1 and 3.2 or to avoid the
unavailability of a Type of Advance under Section 3.3, so long as such
designation is not disadvantageous to such Lender. Each Lender shall deliver
to the Borrower and the Agent a written statement of such Lender as to the
amount due, if any, under Sections 3.1, 3.2 or 3.4. Such written statement
shall set forth in reasonable detail the calculations upon which such Lender
determined such amount and shall be final, conclusive and binding on the
Borrower in the absence of manifest error. Determination of amounts payable
under such Sections in connection with a Eurodollar Loan shall be calculated
as though each Lender funded its Eurodollar Loan through the purchase of a
deposit of the type and maturity corresponding to the deposit used as a
reference in determining the Eurodollar Rate applicable to such Loan, whether
in fact that is the case or not. Unless otherwise provided herein, the amount
specified in the written statement shall be payable on demand after receipt by
the Borrower of the written statement. The obligations of the Borrower under
Sections 3.1, 3.2 and 3.4 shall survive payment of the Obligations and
termination of this Agreement.
ARTICLE IV
CONDITIONS PRECEDENT
The Lenders shall not be required to fund the Borrowing hereunder unless
the Borrower has furnished to the Agent with sufficient copies for the
Lenders:
4.1. Copies of the articles of incorporation of the Borrower,
together with all amendments, and a certificate of good
standing, both certified by the appropriate governmental officer
in its jurisdiction of incorporation.
4.2. Copies, certified by the Secretary or an Assistant Secretary of
the Borrower, of its by-laws and of its Board of Directors'
resolutions (and resolutions of other bodies, if any are deemed
necessary by counsel for any Lender) authorizing the execution
of the Loan Documents.
4.3. An incumbency certificate, executed by the Secretary or an
Assistant Secretary of the Borrower, which shall identify by
name and title and bear the signature of the officers of the
Borrower authorized to sign the Loan Documents and to select
Rate Options and Types of Advances hereunder, upon which
certificate the Agent and the Lenders shall be entitled to rely
until informed of any change in writing by the Borrower.
4.4. A certificate, signed by the chief financial officer of the
Borrower, stating that on the Borrowing Date the representations
and warranties contained in Article V are true and correct and
no Default or Unmatured Default has occurred and is continuing.
4.5. A written opinion of the Borrower's counsel, addressed to the
Lenders in substantially the form of Exhibit "B" hereto.
4.6. Notes payable to the order of each of the Lenders.
4.7. Written money transfer instructions, in substantially the form
of Exhibit "E" hereto, addressed to the Agent and signed by an
Authorized Officer, together with such other related money
transfer authorizations as the Agent may have reasonably
requested.
4.8. Payment in full of all amounts due upon the execution of this
Agreement.
4.9. Such other documents as any Lender or its counsel may have
reasonably requested.
ARTICLE V
REPRESENTATIONS AND WARRANTIES
In order to induce the Lenders to enter into this Agreement and to make
the Loans provided for herein, the Borrower makes the following
representations and warranties to the Lenders:
5.1. Corporate Status. The Borrower is duly incorporated, validly
existing and in good standing under the laws of the Commonwealth of
Pennsylvania, and has the corporate power to make and perform this Agreement
and the Notes and to borrow hereunder.
5.2. Authority; No Conflict. The making and performance by the
Borrower of this Agreement, and the Notes to be executed and delivered by it
as contemplated by this Agreement, have been duly authorized by all necessary
corporate action and do not and will not violate any provision of law or
regulation, or any decree, order, writ or judgment, or any provision of its
charter or by-laws, or result in the breach of or constitute a default under
any indenture or other agreement or instrument to which it is a part.
5.3. Legality, Etc. This Agreement constitutes and, when delivered,
the Notes will constitute legal, valid and binding obligations of the Borrower
enforceable in accordance with their respective terms except to the extent
limited by bankruptcy, insolvency or reorganization laws or by other laws
relating to or affecting the enforceability of creditors' rights generally and
by general equitable principles which may limit the right to obtain equitable
remedies.
5.4. Financial Statements. The financial statements of the Borrower
for the year ended as at December 31, 1994 furnished to the Lenders, fairly
present the financial position of the Borrower at December 31, 1994 and the
results of its operations for the year then ended. Since that date there has
been no adverse change in the business, assets, financial condition or
operations of the Borrower which would materially and adversely affect the
ability of the Borrower to perform any of its obligations hereunder or under
the Notes.
5.5. Litigation. Except as disclosed in or contemplated by the
Disclosure Documents furnished to the Lenders, no litigation, arbitration or
administrative proceeding is pending or, to the knowledge of the Borrower,
threatened, which, if determined adversely to the Borrower, would materially
and adversely affect the ability of the Borrower to perform any of its
obligations under this Agreement or the Notes. There is no litigation,
arbitration or administrative proceeding pending or, to the knowledge of the
Borrower, threatened which questions the validity of this Agreement or the
Notes.
5.6. No Violation. No part of the proceeds of the Borrowing will be
used, directly or indirectly, by the Borrower for the purpose of purchasing or
carrying any "margin stock" within the meaning of Regulation U of the Board of
Governors of the Federal Reserve System, or for any other purpose which
violates, or which conflicts with, the provisions of Regulations G, U or X of
said Board of Governors. The Borrower is not engaged principally, or as one
of its important activities, in the business of extending credit for the
purpose of purchasing or carrying any such "margin stock".
5.7. ERISA. The issuance of the Notes hereunder will not cause the
Borrower to be engaged in a "prohibited transaction," as such term is defined
in Section 4975 of the Internal Revenue Code and there have not been any
"reportable events," as that term is defined in Section 4043 of ERISA, which
would result in a material liability to the Borrower.
5.8. Consents. No authorization, consent or approval from
governmental bodies or regulatory authorities is required for the making and
performance of this Agreement by the Borrower and the execution and delivery
of the Notes issued or proposed to be issued by the Borrower hereunder, except
such authorizations, consents and approvals (including the approval of the
Pennsylvania Public Utility Commission) as have been obtained prior to the
making of any Loans and are in full force and effect at the time of the making
of each Loan.
5.9. Subsidiaries. The assets of all Subsidiaries of the Borrower do
not comprise in the aggregate more than 20% of the total consolidated assets
of the Borrower.
5.10. Limitation Event. No Limitation Event has occurred with respect
to the business, operation or condition (financial or otherwise) of the
Borrower which materially and adversely affects the ability of the Borrower to
perform any of its obligations hereunder or under the Notes.
5.11. Investment Company Act. Neither the Borrower nor any Subsidiary
thereof is an "investment company" or a company "controlled" by an "investment
company", within the meaning of the Investment Company Act of 1940, as
amended.
5.12. Public Utility Holding Company Act. The Borrower is an "exempt
holding company" within the meaning of the Act by virtue of Section 3(a)(2)
thereof. Such exemption is in full force and effect.
ARTICLE VI
COVENANTS
While this Agreement is in effect and until the Aggregate Commitment has
been terminated and all Obligations hereunder and under the Notes shall have
been paid in full, the Borrower agrees that:
6.1. Financial Statements. It will furnish to each Lender:
(a) within 120 days after the end of each of its fiscal years an
auditors' report, including a balance sheet as at the close of such
fiscal year and statements of income, shareowners' common equity and
cash flows for such year, prepared in conformity with generally accepted
accounting principles, with an opinion expressed by Price Waterhouse LLP
or other independent auditors of recognized standing selected by the
Borrower;
(b) within 60 days after the end of each of the first three
quarters in each of the Borrower's fiscal years, a balance sheet as at
the close of such quarterly period and statements of income,
shareowners' common equity and cash flows for such quarterly period,
prepared in conformity with generally accepted accounting principles;
(c) within 120 days after the end of each of its fiscal years, a
copy of the Borrower's Form 10-K Report to the SEC and within 60 days
after the end of the first three quarters in each of the Borrower's
fiscal years, a copy of the Borrower's Form 10-Q Report to the SEC;
provided, that the Borrower's obligations under this Section 6.1(c) may
be satisfied by delivery of Forms 10-K and Forms 10-Q of a holding
company of the Borrower, so long as such statements set forth separate
information for the Borrower and its consolidated Subsidiaries;
(d) from time to time, with reasonable promptness, such further
information regarding the Borrower's business affairs and financial
condition as such Lender may reasonably request; and
(e) upon acquiring knowledge of the existence of an Unmatured
Default or Default, the Borrower will promptly deliver to each Lender a
certificate of a financial officer of the Borrower specifying: (i) the
nature of such Unmatured Default or Default, (ii) the period of the
existence thereof, and (iii) the actions that the Borrower proposes to
take with respect thereto.
The financial statements required to be furnished pursuant to clauses
(a) and (b) above shall be accompanied by an Officer's Certificate.
6.2. Mergers. It will not merge or consolidate (other than a merger
or consolidation under which the Borrower is the surviving corporation) with
any Person or, except in the ordinary course of its business, dispose of all
or substantially all of its assets.
ARTICLE VII
DEFAULTS
Upon the occurrence of any of the following events (each a "Default"):
7.1. Representations, Etc. Any certificate furnished by the Borrower
to the Lenders pursuant hereto shall prove to have been incorrect in any
material respect or any of the representations and warranties made by the
Borrower herein or in connection herewith shall prove to have been incorrect
in any material respect when made; or
7.2. Principal and Interest. The Borrower shall fail to make any
payment of principal on any Note when due or the Borrower shall fail to make
any payment of interest on any Note or any other payment payable by the
Borrower hereunder within 10 days of the due date thereof; or
7.3. Defaults Under Other Agreements. The Borrower shall default in
the payment of the principal of or interest on any obligation (other than
hereunder) for borrowed money beyond any period of grace provided with respect
thereto and the aggregate amount of any such default or defaults shall exceed
$10,000,000 during the term of this Agreement; or the Borrower shall default
in the performance or observance of any other agreement, term or condition
contained therein or in any other agreement or indenture pursuant to which any
such obligation is created or by which it is secured for such period of time
as would cause, or permit the holder or holders of such obligations (or a
trustee or other Person on behalf of such holder or holders) to cause, such
obligation to become due prior to its stated maturity or a portion thereof to
be prepaid (other than by a regularly scheduled required prepayment) prior to
such stated maturity and the aggregate amount of such obligation or
obligations shall exceed $10,000,000 during the term of this Agreement; or
7.4. Bankruptcy, Etc. The Borrower shall commence a voluntary case
concerning itself under Title 11 of the United States Code entitled
"Bankruptcy" as now or hereafter in effect or any successor thereto (the
"Bankruptcy Code"); or an involuntary case is commenced against the Borrower
or such case is controverted but is not dismissed within 60 days after the
commencement of the case; or the Borrower is not generally paying its debts as
they become due; or a custodian (as defined in the Bankruptcy Code) is
appointed for, or takes charge of, all or substantially all of the property of
the Borrower or the Borrower commences any other proceedings under any
reorganization, arrangement, readjustment of debt, relief of debtors,
dissolution, insolvency or liquidation or similar laws of any jurisdiction
whether now or hereafter in effect relating to the Borrower or there is
commenced against the Borrower any such proceeding which remains undismissed
for a period of 60 days or the Borrower is adjudicated insolvent or bankrupt;
or the Borrower fails to controvert in a timely manner any such case under the
Bankruptcy Code or any such proceeding, or any order of relief or other order
approving any such case or proceeding is entered; or the Borrower by any act
or failure to act indicates its consent to, approval of or acquiescence in any
such case or proceeding or in the appointment of any custodian or the like for
its or any substantial part of its property or suffers any such appointment to
continue undischarged or unstayed for a period of 60 days; or the Borrower
makes a general assignment for the benefit of creditors; or any corporate
action is taken by the Borrower for the purpose of effecting any of the
foregoing; or
7.5. Other Covenants. Either (a) the Borrower shall fail to perform
its obligations under Section 6.1(e) and any such failure shall remain
unremedied for a period of 30 days, or (b) the Borrower shall fail to perform
or observe any other term, covenant or agreement contained in this Agreement
on its part to be performed or observed and any such failure shall remain
unremedied for a period of 30 days after written notice thereof shall have
been received by the Borrower from the Agent or the Required Lenders;
then, and in any such event, and at any time thereafter, if any Default shall
then be continuing, either or both of the following actions may be taken: (i)
the Agent, at the direction of the Required Lenders, shall by written notice
to the Borrower, declare the principal of and accrued interest in respect of
all of the Notes to be, whereupon the same and all other amounts due hereunder
shall become, forthwith due and payable without presentment, demand, protest
or other notice of any kind, all of which are hereby expressly waived by the
Borrower, anything contained herein or in the Notes to the contrary
notwithstanding, and (ii) the Agent, at the direction of the Required Lenders,
shall by written notice to the Borrower, declare the Aggregate Commitment
terminated, whereupon the Commitment of each Lender and the obligation of each
Lender to make its Loans hereunder shall terminate immediately; provided that
if an Event of Default described in Section 7.4 shall occur, the result which
would otherwise occur only upon the giving of written notice by the Agent to
the Borrower as specified in clauses (i) and (ii) above shall occur
automatically without the giving of any such notice and without any
instruction by the Required Lenders to give such notice. If, within 14 days
after acceleration of the maturity of the Obligations or termination of the
obligations of the Lenders to make Loans hereunder as a result of any Default
(other than any Default as described in Section 7.4) and before any judgment
or decree for the payment of the Obligations due shall have been obtained or
entered, the Required Lenders (in their sole discretion) shall so direct, the
Agent shall, by notice to the Borrower, rescind and annul such acceleration
and/or termination.
ARTICLE VIII
AMENDMENTS; PRESERVATION OF RIGHTS
8.1. Amendments. Subject to the provisions of this Article VIII, the
Required Lenders (or the Agent with the consent in writing of the Required
Lenders) and the Borrower may enter into agreements supplemental hereto for
the purpose of adding or modifying any provisions to the Loan Documents or
changing in any manner the rights of the Lenders or the Borrower hereunder or
waiving any Default hereunder; provided, however, that no such supplemental
agreement shall, without the consent of each Lender affected thereby:
(i) Extend the maturity of any Loan or Note or forgive all or any
portion of the principal amount thereof, or reduce the rate or
extend the time of payment of interest or fees thereon.
(ii) Reduce the percentage specified in the definition of Required
Lenders.
(iii) Reduce the amount or extend the payment date for the mandatory
payments required under Section 2.2, or increase the amount of
the Commitment of any Lender hereunder, or permit the Borrower
to assign its rights under this Agreement.
(iv) Amend this Section 8.1.
No amendment of any provision of this Agreement relating to the Agent shall be
effective without the written consent of the Agent. The Agent may waive
payment of the fee required under Section 12.3.2 without obtaining the consent
of any other party to this Agreement.
8.2. Preservation of Rights. No delay or omission of the Lenders or
the Agent to exercise any right under the Loan Documents shall impair such
right or be construed to be a waiver of any Default or an acquiescence
therein, and the making of a Loan notwithstanding the existence of a Default
or the inability of the Borrower to satisfy the conditions precedent to such
Loan shall not constitute any waiver or acquiescence. Any single or partial
exercise of any such right shall not preclude other or further exercise
thereof or the exercise of any other right, and no waiver, amendment or other
variation of the terms, conditions or provisions of the Loan Documents
whatsoever shall be valid unless in writing signed by the Lenders required
pursuant to Section 8.1, and then only to the extent in such writing
specifically set forth. All remedies contained in the Loan Documents or by
law afforded shall be cumulative and all shall be available to the Agent and
the Lenders until the Obligations have been paid in full.
ARTICLE IX
GENERAL PROVISIONS
9.1. Survival of Representations. All representations and warranties
of the Borrower contained in this Agreement shall survive delivery of the
Notes and the making of the Loans herein contemplated.
9.2. Governmental Regulation. Anything contained in this Agreement to
the contrary notwithstanding, no Lender shall be obligated to extend credit to
the Borrower in violation of any limitation or prohibition provided by any
applicable statute or regulation.
9.3. Taxes. Any taxes (excluding income taxes on the overall net
income of any Lender) or other similar assessments or charges made by any
governmental or revenue authority in respect of the Loan Documents shall be
paid by the Borrower, together with interest and penalties, if any.
9.4. Headings. Section headings in the Loan Documents are for
convenience of reference only, and shall not govern the interpretation of any
of the provisions of the Loan Documents.
9.5. Entire Agreement. The Loan Documents embody the entire agreement
and understanding among the Borrower, the Agent and the Lenders and supersede
all prior agreements and understandings among the Borrower, the Agent and the
Lenders relating to the subject matter thereof.
9.6. Several Obligations; Benefits of this Agreement. The respective
obligations of the Lenders hereunder are several and not joint and no Lender
shall be the partner or agent of any other (except to the extent to which the
Agent is authorized to act as such). The failure of any Lender to perform any
of its obligations hereunder shall not relieve any other Lender from any of
its obligations hereunder. This Agreement shall not be construed so as to
confer any right or benefit upon any Person other than the parties to this
Agreement and their respective successors and assigns.
9.7. Expenses; Indemnification. The Borrower shall reimburse the
Agent for any costs, internal charges and out-of-pocket expenses (including
reasonable attorneys' fees and time charges of attorneys for the Agent, which
attorneys may be employees of the Agent) paid or incurred by the Agent in
connection with the preparation, negotiation, execution, delivery, review,
amendment, modification, and administration of the Loan Documents, subject to
the terms of that certain letter agreement between the Agent and the Borrower
dated October 27, 1995. The Borrower also agrees to reimburse the Agent and
the Lenders for any costs, internal charges and out-of-pocket expenses
(including reasonable attorneys' fees and time charges of attorneys for the
Agent and the Lenders, which attorneys may be employees of the Agent or the
Lenders) paid or incurred by the Agent or any Lender in connection with the
collection and enforcement of the Loan Documents. The Borrower further agrees
to indemnify the Agent and each Lender, its directors, officers and employees
against all losses, claims, damages, penalties, judgments, liabilities and
expenses (including, without limitation, all expenses of litigation or
preparation therefor whether or not the Agent or any Lender is a party
thereto) which any of them may pay or incur arising out of or relating to this
Agreement, the other Loan Documents, the transactions contemplated hereby or
the direct or indirect application or proposed application of the proceeds of
any Loan hereunder provided that such indemnification shall not extend to
disputes among the Agent and the Lenders. The obligations of the Borrower
under this Section shall survive the termination of this Agreement.
9.8. Numbers of Documents. All statements, notices, closing
documents, and requests hereunder shall be furnished to the Agent with
sufficient counterparts so that the Agent may furnish one to each of the
Lenders.
9.9. Accounting. Except as provided to the contrary herein, all
accounting terms used herein shall be interpreted and all accounting
determinations hereunder shall be made in accordance with generally accepted
accounting principles, except that any determination which is to be made on a
consolidated basis shall be made for the Borrower and all its Subsidiaries,
including those Subsidiaries, if any, which are unconsolidated on the
Borrower's audited financial statements.
9.10. Severability of Provisions. Any provision in any Loan Document
that is held to be inoperative, unenforceable, or invalid in any jurisdiction
shall, as to that jurisdiction, be inoperative, unenforceable, or invalid
without affecting the remaining provisions in that jurisdiction or the
operation, enforceability, or validity of that provision in any other
jurisdiction, and to this end the provisions of all Loan Documents are
declared to be severable.
9.11. Nonliability of Lenders. The relationship between the Borrower
and the Lenders and the Agent shall be solely that of borrower and lender.
Neither the Agent nor any Lender shall have any fiduciary responsibilities to
the Borrower. Neither the Agent nor any Lender undertakes any responsibility
to the Borrower to review or inform the Borrower of any matter in connection
with any phase of the Borrower's business or operations.
9.12. CHOICE OF LAW. THE LOAN DOCUMENTS (OTHER THAN THOSE CONTAINING
A CONTRARY EXPRESS CHOICE OF LAW PROVISION) SHALL BE CONSTRUED IN ACCORDANCE
WITH THE INTERNAL LAWS (AND NOT THE LAW OF CONFLICTS) OF THE STATE OF
ILLINOIS, BUT GIVING EFFECT TO FEDERAL LAWS APPLICABLE TO NATIONAL BANKS.
9.13. CONSENT TO JURISDICTION. EACH OF THE BORROWER, THE AGENT, AND
EACH LENDER HEREBY IRREVOCABLY SUBMITS TO THE JURISDICTION OF ANY UNITED
STATES FEDERAL OR ILLINOIS STATE COURT SITTING IN CHICAGO IN ANY ACTION OR
PROCEEDING ARISING OUT OF OR RELATING TO ANY LOAN DOCUMENTS AND HEREBY
IRREVOCABLY AGREES THAT ALL CLAIMS IN RESPECT OF SUCH ACTION OR PROCEEDING MAY
BE HEARD AND DETERMINED IN ANY SUCH COURT AND IRREVOCABLY WAIVES ANY OBJECTION
IT MAY NOW OR HEREAFTER HAVE AS TO THE VENUE OF ANY SUCH SUIT, ACTION OR
PROCEEDING BROUGHT IN SUCH A COURT OR THAT SUCH COURT IS AN INCONVENIENT
FORUM. IN THE EVENT THAT ANY SUCH UNITED STATES FEDERAL OR ILLINOIS STATE
COURT SITTING IN CHICAGO DOES NOT ACCEPT SUCH JURISDICTION, NOTHING HEREIN
SHALL LIMIT THE RIGHT OF ANY PARTY HERETO TO BRING PROCEEDINGS AGAINST THE
BORROWER IN THE COURTS OF ANY OTHER JURISDICTION. ANY JUDICIAL PROCEEDING BY
THE BORROWER AGAINST THE AGENT OR ANY LENDER OR ANY AFFILIATE OF THE AGENT OR
ANY LENDER INVOLVING, DIRECTLY OR INDIRECTLY, ANY MATTER IN ANY WAY ARISING
OUT OF, RELATED TO, OR CONNECTED WITH ANY LOAN DOCUMENT SHALL BE BROUGHT ONLY
IN A COURT IN CHICAGO, ILLINOIS.
9.14. WAIVER OF JURY TRIAL. THE BORROWER, THE AGENT AND EACH LENDER
HEREBY WAIVE TRIAL BY JURY IN ANY JUDICIAL PROCEEDING INVOLVING, DIRECTLY OR
INDIRECTLY, ANY MATTER (WHETHER SOUNDING IN TORT, CONTRACT OR OTHERWISE) IN
ANY WAY ARISING OUT OF, RELATED TO, OR CONNECTED WITH ANY LOAN DOCUMENT OR THE
RELATIONSHIP ESTABLISHED THEREUNDER.
9.15. Confidentiality. Each Lender agrees to hold any confidential
information which it may receive from the Borrower pursuant to this Agreement
in confidence, except for disclosure (i) to other Lenders and their respective
Affiliates, (ii) to legal counsel, accountants, and other professional
advisors to that Lender or to a Transferee, (iii) to regulatory officials,
(iv) to any Person as required by law, regulation, or legal process, (v) to
any Person in connection with any legal proceeding to which that Lender is a
party, and (vi) permitted by Section 12.4.
ARTICLE X
THE AGENT
10.1. Appointment. The First National Bank of Chicago is hereby
appointed Agent hereunder and under each other Loan Document, and each of the
Lenders irrevocably authorizes the Agent to act as the agent of such Lender.
The Agent agrees to act as such upon the express conditions contained in this
Article X. The Agent shall not have a fiduciary relationship in respect of
the Borrower or any Lender by reason of this Agreement.
10.2. Powers. The Agent shall have and may exercise such powers under
the Loan Documents as are specifically delegated to the Agent by the terms of
each thereof, together with such powers as are reasonably incidental thereto.
The Agent shall have no implied duties to the Lenders, or any obligation to
the Lenders to take any action thereunder except any action specifically
provided by the Loan Documents to be taken by the Agent.
10.3. General Immunity. Neither the Agent nor any of its directors,
officers, agents or employees shall be liable to the Borrower, the Lenders or
any Lender for any action taken or omitted to be taken by it or them hereunder
or under any other Loan Document or in connection herewith or therewith except
for its or their own gross negligence or willful misconduct.
10.4. No Responsibility for Loans, Recitals, etc. Neither the Agent
nor any of its directors, officers, agents or employees shall be responsible
for or have any duty to ascertain, inquire into, or verify (i) any statement,
warranty or representation made in connection with any Loan Document or any
borrowing hereunder; (ii) the performance or observance of any of the
covenants or agreements of any obligor under any Loan Document, including,
without limitation, any agreement by an obligor to furnish information
directly to each Lender; (iii) the satisfaction of any condition specified in
Article IV, except receipt of items required to be delivered to the Agent;
(iv) the validity, effectiveness or genuineness of any Loan Document or any
other instrument or writing furnished in connection therewith; or (v) the
value, sufficiency, creation, perfection or priority of any interest in any
collateral security. The Agent shall have no duty to disclose to the Lenders
information that is not required to be furnished by the Borrower to the Agent
at such time, but is voluntarily furnished by the Borrower to the Agent
(either in its capacity as Agent or in its individual capacity).
10.5. Action on Instructions of Lenders. The Agent shall in all cases
be fully protected in acting, or in refraining from acting, hereunder and
under any other Loan Document in accordance with written instructions signed
by the Required Lenders, and such instructions and any action taken or failure
to act pursuant thereto shall be binding on all of the Lenders and on all
holders of Notes. The Agent shall be fully justified in failing or refusing
to take any action hereunder and under any other Loan Document unless it shall
first be indemnified to its satisfaction by the Lenders pro rata against any
and all liability, cost and expense that it may incur by reason of taking or
continuing to take any such action.
10.6. Employment of Agents and Counsel. The Agent may execute any of
its duties as Agent hereunder and under any other Loan Document by or through
employees, agents, and attorneys-in-fact and shall not be answerable to the
Lenders, except as to money or securities received by it or its authorized
agents, for the default or misconduct of any such agents or attorneys-in-fact
selected by it with reasonable care. The Agent shall be entitled to advice of
counsel concerning all matters pertaining to the agency hereby created and its
duties hereunder and under any other Loan Document.
10.7. Reliance on Documents; Counsel. The Agent shall be entitled to
rely upon any Note, notice, consent, certificate, affidavit, letter, telegram,
statement, paper or document believed by it to be genuine and correct and to
have been signed or sent by the proper person or persons, and, in respect to
legal matters, upon the opinion of counsel selected by the Agent, which
counsel may be employees of the Agent.
10.8. Agent's Reimbursement and Indemnification. The Lenders agree to
reimburse and indemnify the Agent ratably in proportion to their respective
Commitments (i) for any amounts not reimbursed by the Borrower for which the
Agent is entitled to reimbursement by the Borrower under the Loan Documents,
(ii) for any other expenses incurred by the Agent on behalf of the Lenders, in
connection with the preparation, execution, delivery, administration and
enforcement of the Loan Documents and (iii) for any liabilities, obligations,
losses, damages, penalties, actions, judgments, suits, costs, expenses or
disbursements of any kind and nature whatsoever which may be imposed on,
incurred by or asserted against the Agent in any way relating to or arising
out of the Loan Documents or any other document delivered in connection
therewith or the transactions contemplated thereby, or the enforcement of any
of the terms thereof or of any such other documents, provided that no Lender
shall be liable for any of the foregoing to the extent they arise from the
gross negligence or willful misconduct of the Agent. The obligations of the
Lenders under this Section 10.8 shall survive payment of the Obligations and
termination of this Agreement.
10.9. Rights as a Lender. In the event the Agent is a Lender, the
Agent shall have the same rights and powers hereunder and under any other Loan
Document as any Lender and may exercise the same as though it were not the
Agent, and the term "Lender" or "Lenders" shall, at any time when the Agent is
a Lender, unless the context otherwise indicates, include the Agent in its
individual capacity. The Agent may accept deposits from, lend money to, and
generally engage in any kind of trust, debt, equity or other transaction, in
addition to those contemplated by this Agreement or any other Loan Document,
with the Borrower or any of its Subsidiaries in which the Borrower or such
Subsidiary is not restricted hereby from engaging with any other Person. The
Agent, in its individual capacity, is not obligated to remain a Lender.
10.10. Lender Credit Decision. Each Lender acknowledges that it has,
independently and without reliance upon the Agent or any other Lender and
based on the financial statements prepared by the Borrower and such other
documents and information as it has deemed appropriate, made its own credit
analysis and decision to enter into this Agreement and the other Loan
Documents. Each Lender also acknowledges that it will, independently and
without reliance upon the Agent or any other Lender and based on such
documents and information as it shall deem appropriate at the time, continue
to make its own credit decisions in taking or not taking action under this
Agreement and the other Loan Documents.
10.11. Successor Agent. The Agent may resign at any time by giving
written notice thereof to the Lenders and the Borrower, such resignation to be
effective upon the appointment of a successor Agent or, if no successor Agent
has been appointed, forty-five days after the retiring Agent gives notice of
its intention to resign. Upon any such resignation, the Required Lenders
shall have the right to appoint, on behalf of the Borrower and the Lenders and
with the consent of the Borrower (which shall not be unreasonably withheld or
delayed), a successor Agent. If no successor Agent shall have been so
appointed by the Required Lenders within thirty days after the resigning
Agent's giving notice of its intention to resign, then the resigning Agent may
appoint, on behalf of the Borrower and the Lenders and with the consent of the
Borrower (which shall not be unreasonably withheld or delayed), a successor
Agent. If the Agent has resigned and no successor Agent has been appointed,
the Lenders may perform all the duties of the Agent hereunder and the Borrower
shall make all payments in respect of the Obligations to the applicable Lender
and for all other purposes shall deal directly with the Lenders. No successor
Agent shall be deemed to be appointed hereunder until such successor Agent has
accepted the appointment. Any such successor Agent shall be a commercial bank
having capital and retained earnings of at least $50,000,000. Upon the
acceptance of any appointment as Agent hereunder by a successor Agent, such
successor Agent shall thereupon succeed to and become vested with all the
rights, powers, privileges and duties of the resigning Agent. Upon the
effectiveness of the resignation of the Agent, the resigning Agent shall be
discharged from its duties and obligations hereunder and under the Loan
Documents. After the effectiveness of the resignation of an Agent, the
provisions of this Article X shall continue in effect for the benefit of such
Agent in respect of any actions taken or omitted to be taken by it while it
was acting as the Agent hereunder and under the other Loan Documents.
10.12. Agent's Fee. The Borrower agrees to pay to the Agent, for its
own account, the fees agreed to by the Borrower and the Agent pursuant to that
certain letter agreement dated October 27, 1995.
ARTICLE XI
SETOFF; RATABLE PAYMENTS
11.1. Setoff. In addition to, and without limitation of, any rights
of the Lenders under applicable law, if the Borrower becomes insolvent,
however evidenced, or any Default occurs, any and all deposits (including all
account balances, whether provisional or final and whether or not collected or
available) and any other Indebtedness at any time held or owing by any Lender
to or for the credit or account of the Borrower may be offset and applied
toward the payment of the Obligations owing to such Lender, whether or not the
Obligations, or any part hereof, shall then be due.
11.2. Ratable Payments. If any Lender, whether by setoff or
otherwise, has payment made to it upon its Loans (other than payments received
pursuant to Sections 3.1, 3.2 or 3.4) in a greater proportion than that
received by any other Lender, such Lender agrees, promptly upon demand, to
purchase a portion of the Loans held by the other Lenders so that after such
purchase each Lender will hold its ratable proportion of Loans. If any
Lender, whether in connection with setoff or amounts which might be subject to
setoff or otherwise, receives collateral or other protection for its
Obligations or such amounts which may be subject to setoff, such Lender
agrees, promptly upon demand, to take such action necessary such that all
Lenders share in the benefits of such collateral ratably in proportion to
their Loans. In case any such payment is disturbed by legal process, or
otherwise, appropriate further adjustments shall be made.
ARTICLE XII
BENEFIT OF AGREEMENT; ASSIGNMENTS; PARTICIPATIONS
12.1. Successors and Assigns. The terms and provisions of the Loan
Documents shall be binding upon and inure to the benefit of the Borrower and
the Lenders and their respective successors and assigns, except that (i) the
Borrower shall not have the right to assign its rights or obligations under
the Loan Documents and (ii) any assignment by any Lender must be made in
compliance with Section 12.3. Notwithstanding clause (ii) of this Section,
any Lender may at any time, without the consent of the Borrower or the Agent,
assign all or any portion of its rights under this Agreement and its Notes to
a Federal Reserve Bank; provided, however, that no such assignment shall
release the transferor Lender from its obligations hereunder. The Agent may
treat the payee of any Note as the owner thereof for all purposes hereof
unless and until such payee complies with Section 12.3 in the case of an
assignment thereof or, in the case of any other transfer, a written notice of
the transfer is filed with the Agent. Any assignee or transferee of a Note
agrees by acceptance thereof to be bound by all the terms and provisions of
the Loan Documents. Any request, authority or consent of any Person, who at
the time of making such request or giving such authority or consent is the
holder of any Note, shall be conclusive and binding on any subsequent holder,
transferee or assignee of such Note or of any Note or Notes issued in exchange
therefor.
12.2. Participations.
12.2.1. Permitted Participants; Effect. Any Lender may, in the
ordinary course of its business and in accordance with applicable law,
at any time sell to one or more banks or other entities ("Participants")
participating interests in any Loan owing to such Lender, any Note held
by such Lender, any Commitment of such Lender or any other interest of
such Lender under the Loan Documents. In the event of any such sale by
a Lender of participating interests to a Participant, such Lender's
obligations under the Loan Documents shall remain unchanged, such Lender
shall remain solely responsible to the other parties hereto for the
performance of such obligations, such Lender shall remain the holder of
any such Note for all purposes under the Loan Documents, all amounts
payable by the Borrower under this Agreement shall be determined as if
such Lender had not sold such participating interests, and the Borrower
and the Agent shall continue to deal solely and directly with such
Lender in connection with such Lender's rights and obligations under the
Loan Documents.
12.2.2. Voting Rights. Each Lender shall retain the sole right
to approve, without the consent of any Participant, any amendment,
modification or waiver of any provision of the Loan Documents other than
any amendment, modification or waiver with respect to any Loan or
Commitment in which such Participant has an interest which forgives
principal, interest or fees or reduces the interest rate or fees payable
with respect to any such Loan or Commitment, postpones any date fixed
for any regularly-scheduled payment of principal of, or interest or fees
on, any such Loan or Commitment, releases any guarantor of any such Loan
or releases any substantial portion of collateral, if any, securing any
such Loan.
12.2.3. Benefit of Setoff. The Borrower agrees that each
Participant shall be deemed to have the right of setoff provided in
Section 11.1 in respect of its participating interest in amounts owing
under the Loan Documents to the same extent as if the amount of its
participating interest were owing directly to it as a Lender under the
Loan Documents, provided that each Lender shall retain the right of
setoff provided in Section 11.1 with respect to the amount of
participating interests sold to each Participant. The Lenders agree to
share with each Participant, and each Participant, by exercising the
right of setoff provided in Section 11.1, agrees to share with each
Lender, any amount received pursuant to the exercise of its right of
setoff, such amounts to be shared in accordance with Section 11.2 as if
each Participant were a Lender.
12.3. Assignments.
12.3.1. Permitted Assignments. Any Lender may, in the ordinary
course of its business and in accordance with applicable law, at any
time assign to one or more banks or other entities ("Purchasers") all or
any part of its rights and obligations under the Loan Documents,
provided that any such assignment shall be in a minimum amount equal to
the lesser of the assigning Lender's Commitment or $10,000,000. Such
assignment shall be substantially in the form of Exhibit "D" hereto or
in such other form as may be agreed to by the parties thereto. The
consent of the Borrower and the Agent shall be required prior to an
assignment becoming effective with respect to a Purchaser which is not a
Lender or an Affiliate thereof; provided, however, that if a Default has
occurred and is continuing, the consent of the Borrower shall not be
required. Such consent shall not be unreasonably withheld or delayed.
12.3.2. Effect; Effective Date. Upon (i) delivery to the Agent
of a notice of assignment, substantially in the form attached as Exhibit
"I" to Exhibit "D" hereto (a "Notice of Assignment"), together with any
consents required by Section 12.3.1, and (ii) payment of a $3,500 fee to
the Agent for processing such assignment, such assignment shall become
effective on the effective date specified in such Notice of Assignment.
The Notice of Assignment shall contain a representation by the
Purchaser to the effect that none of the consideration used to make the
purchase of the Commitment and Loans under the applicable assignment
agreement are "plan assets" as defined under ERISA and that the rights
and interests of the Purchaser in and under the Loan Documents will not
be "plan assets" under ERISA. On and after the effective date of such
assignment, such Purchaser shall for all purposes be a Lender party to
this Agreement and any other Loan Document executed by the Lenders and
shall have all the rights and obligations of a Lender under the Loan
Documents, to the same extent as if it were an original party hereto,
and no further consent or action by the Borrower, the Lenders or the
Agent shall be required to release the transferor Lender with respect to
the percentage of the Aggregate Commitment and Loans assigned to such
Purchaser. Upon the consummation of any assignment to a Purchaser
pursuant to this Section 12.3.2, the transferor Lender, the Agent and
the Borrower shall make appropriate arrangements so that replacement
Notes are issued to such transferor Lender and new Notes or, as
appropriate, replacement Notes, are issued to such Purchaser, in each
case in principal amounts reflecting their Commitment, as adjusted
pursuant to such assignment.
12.4. Dissemination of Information. The Borrower authorizes each
Lender to disclose to any Participant or Purchaser or any other Person
acquiring an interest in the Loan Documents by operation of law (each a
"Transferee") and any prospective Transferee any and all information in such
Lender's possession concerning the creditworthiness of the Borrower and its
Subsidiaries, provided that each Transferee and prospective Transferee agrees
to be bound by Section 9.15 of this Agreement.
12.5. Tax Treatment. If any interest in any Loan Document is
transferred to any Transferee which is organized under the laws of any
jurisdiction other than the United States or any State thereof, the transferor
Lender shall cause such Transferee, concurrently with the effectiveness of
such transfer, to comply with the provisions of Section 2.17.
ARTICLE XIII
NOTICES
13.1. Giving Notice. Except as otherwise permitted by Section 2.12
with respect to borrowing notices, all notices and other communications
provided to any party hereto under this Agreement or any other Loan Document
shall be in writing or by telex or by facsimile and addressed or delivered to
such party at its address set forth below its signature hereto or at such
other address as may be designated by such party in a notice to the other
parties. Any notice, if mailed and properly addressed with postage prepaid,
shall be deemed given when received; any notice, if transmitted by telex or
facsimile, shall be deemed given when transmitted (answerback confirmed in the
case of telexes).
13.2. Change of Address. The Borrower, the Agent and any Lender may
each change the address for service of notice upon it by a notice in writing
to the other parties hereto.
ARTICLE XIV
COUNTERPARTS
This Agreement may be executed in any number of counterparts, all of
which taken together shall constitute one agreement, and any of the parties
hereto may execute this Agreement by signing any such counterpart. This
Agreement shall be effective when it has been executed by the Borrower, the
Agent and the Lenders and each party has notified the Agent by telex or
telephone, that it has taken such action.
IN WITNESS WHEREOF, the Borrower, the Lenders and the Agent have
executed this Agreement as of the date first above written.
PENNSYLVANIA POWER & LIGHT COMPANY
By: _/s/ John R. Biggar_________________
John R. Biggar
Vice President - Finance and
Treasurer
Two North Ninth Street
Allentown, Pennsylvania 18101-1179
Attention: Treasurer
Telecopier: (610) 774-5106
Commitments
$25,000,000 THE FIRST NATIONAL BANK OF
CHICAGO, Individually and as Agent
By: __/s/ Kenneth J. Bauer_______________
Kenneth J. Bauer
Authorized Agent
One First National Plaza
Chicago, Illinois 60670
Attention: Electric, Gas &
Telecommunications Division
Telecopier: (312) 732-3055
$24,000,000 CREDIT SUISSE
By: __/s/ Andrea E. Shkane_______________
Print Name: Andrea E. Shkane_____________
Title: Member of Senior Management_______
By: __/s/ Thomas G. Muoio________________
Print Name: _Thomas G. Muoio_____________
Title: ______Associate___________________
12 East 49th Street
New York, New York 10017
Attention: Mid-Atlantic Group
Telecopier: (212) 238-5389
$20,000,000 MELLON BANK
By: __/s/ Mary Ellen Usher_______________
Mary Ellen Usher
Vice President
One Mellon Bank Center
Room 4425
Pittsburgh, Pennsylvania 15258
Attention: Energy and Utilities Group
Telecopier: (412) 234-8888
$10,000,000 THE BANK OF NEW YORK
By: ____/s/ Nathan S. Howard____________
Print Name: __Nathan S. Howard__________
Title: ___Vice President________________
One Wall Street
New York, New York 10286
Attention: Nathan Howard
Vice President
Telecopier: (212) 635-7923
$10,000,000 SANWA BANK
By: ____/s/ Christian Kambour___________
Print Name: __Christian Kambour_________
Title: _______Assistant Vice President__
55 East 52nd Street
New York, New York 10055
Attention: _____________________________
Telecopier: (212) 754-1304
$10,000,000 TORONTO DOMINION (TEXAS), INC
By: ___/s/_Diane_Bailey_________________
Print Name: ____Diane_Bailey____________
Title: _________Vice_President__________
909 Fannin, Suite 1700
Houston, Texas 77010
Attention: Diane Bailey
Telecopier: (713) 951-9921
$10,000,000 UNION BANK OF SWITZERLAND
By: _/s/_Paul_R._Morrison________________
Print Name: __Paul_R._Morrison___________
Title: _______Vice_President_____________
By: __/s/_Robert_A._High_________________
Print Name: __Robert_A._High_____________
Title: _______Assistant_Treasurer________
299 Park Avenue, 31st Floor
New York, New York 10171-0026
Attention: Paul R. Morrison
Telecopier: (212) 821-3878
$7,000,000 CHEMICAL BANK
By: _____/s/_Jane_Ritchie_______________
Jane Ritchie
Vice President
270 Park Avenue, 10th Floor
New York, New York 10017-2070
Attention: Jane Ritchie
Utilities Group
Telecopier: (212) 270-5007
____________
$116,000,000
EXHIBIT "A"
NOTE
$_____________ _______________, 19____
PENNSYLVANIA POWER & LIGHT COMPANY, a Pennsylvania corporation (the
"Borrower"), promises to pay to the order of _____________________ (the
"Lender") the lesser of the principal sum of _____________________ Dollars or
the aggregate unpaid principal amount of all Loans made by the Lender to the
Borrower pursuant to Article II of the Credit Agreement (as the same may be
amended or modified, the "Agreement") hereinafter referred to, in immediately
available funds at the main office of The First National Bank of Chicago in
Chicago, Illinois, as Agent, together with interest on the unpaid principal
amount hereof at the rates and on the dates set forth in the Agreement. The
Borrower shall pay the principal of and accrued and unpaid interest on the
Loans in full on the Facility Termination Date.
The Lender shall, and is hereby authorized to, record on the schedule
attached hereto, or to otherwise record in accordance with its usual practice,
the date and amount of each Loan and the date and amount of each principal
payment hereunder.
This Note is one of the Notes issued pursuant to, and is entitled to the
benefits of, the Credit Agreement, dated as of March 14, 1996 among the
Borrower, The First National Bank of Chicago, individually and as Agent, and
the lenders named therein, including the Lender, to which Agreement, as it may
be amended from time to time, reference is hereby made for a statement of the
terms and conditions governing this Note, including the terms and conditions
under which this Note may be prepaid or its maturity date accelerated.
Capitalized terms used herein and not otherwise defined herein are used with
the meanings attributed to them in the Agreement.
PENNSYLVANIA POWER & LIGHT COMPANY
By: _____________________________________
Print Name: _____________________________
Title: __________________________________
SCHEDULE OF LOANS AND PAYMENTS OF PRINCIPAL
TO
NOTE OF PENNSYLVANIA POWER & LIGHT COMPANY
DATED _______________________, 19____
Maturity
Principal Maturity Principal
Amount of of Interest Amount Unpaid
___Date___________Loan___________Period_____________Paid____________Balance___
EXHIBIT "B"
FORM OF OPINION
March 14, 1996
The Agent and the Lenders who are parties to the
Credit Agreement described below.
Gentlemen/Ladies:
I am Senior Counsel of Pennsylvania Power & Light Company (the
"Borrower"), and, as such, am familiar with the steps and proceedings taken by
the Borrower in connection with its execution and delivery of a Term Credit
Agreement among the Borrower, The First National Bank of Chicago, individually
and as Agent, and the Lenders named therein, providing for Advances in an
aggregate principal amount not exceeding $116,000,000 at any one time
outstanding and dated as of March 14, 1996 (the "Agreement"). All capitalized
terms used in this opinion and not otherwise defined shall have the meanings
attributed to them in the Agreement.
I have examined the Borrower's articles of incorporation, by-laws,
resolutions, the Loan Documents and such other matters of fact and law which I
deem necessary in order to render this opinion. Based upon the foregoing, it
is my opinion that:
l. The Borrower is a corporation duly incorporated, validly existing
and in good standing under the laws of its state of incorporation and has all
requisite authority to conduct its business in each jurisdiction in which its
business is conducted.
2. The execution and delivery of the Loan Documents by the Borrower and
the performance by the Borrower of the Obligations have been duly authorized
by all necessary corporate action and proceedings on the part of the Borrower
and will not:
(a) require any consent of the Borrower's shareholders;
(b) violate any law, rule, regulation, order, writ, judgment,
injunction, decree or award binding on the Borrower or the Borrower's
articles of incorporation or by-laws or any indenture, instrument or
agreement binding upon the Borrower; or
(c) result in, or require, the creation or imposition of any lien
pursuant to the provisions of any indenture, instrument or agreement
binding upon the Borrower.
3. The Loan Documents have been duly executed and delivered by the
Borrower and constitute legal, valid and binding obligations of the Borrower
enforceable in accordance with their terms except to the extent the
enforcement thereof may be limited by bankruptcy, insolvency or similar laws
affecting the enforcement of creditors' rights generally and subject also to
the availability of equitable remedies if equitable remedies are sought.
4. Except as set forth in the Borrower's Form 10-K Report to the
Securities and Exchange Commission for the year ended December 31, 1994, there
is no litigation or proceeding against the Borrower or any of its Subsidiaries
which, if adversely determined, could reasonably be expected to have a
material adverse effect on the financial condition of the Borrower or its
ability to perform its obligations under the Loan Documents.
5. No approval, authorization, consent, adjudication or order of any
governmental authority, which has not been obtained by the Borrower, is
required to be obtained by the Borrower in connection with the execution and
delivery of the Loan Documents, the borrowings under the Agreement or in
connection with the payment by the Borrower of the Obligations.
This opinion may be relied upon only by the Agent, the Lenders and their
participants, assignees and other transferees.
Very truly yours,
Michael A. McGrail
Senior Counsel
EXHIBIT "C"
OFFICER'S CERTIFICATE
To: The Lenders parties to the
Term Credit Agreement Described Below
This Officer's Certificate is furnished pursuant to that certain Term
Credit Agreement dated as of March 14, 1996 (as amended, modified, renewed or
extended from time to time, the "Agreement") among the Borrower, the lenders
party thereto and The First National Bank of Chicago, as Agent for the
Lenders. Unless otherwise defined herein, capitalized terms used in this
Officer's Certificate have the meanings ascribed thereto in the Agreement.
THE UNDERSIGNED HEREBY CERTIFIES THAT:
1. I am the duly elected _____________________ of the Borrower;
2. I have reviewed the terms of the Agreement and I have made, or have
caused to be made under my supervision, a detailed review of the transactions
and conditions of the Borrower and its Subsidiaries during the accounting
period covered by the attached financial statements; and
3. The examinations described in paragraph 2 did not disclose, and I
have no knowledge of, the existence of any condition or event which
constitutes a Default or Unmatured Default during or at the end of the
accounting period covered by the attached financial statements or as of the
date of this Certificate, except as set forth below.
Described below are the exceptions, if any, to paragraph 3 by listing,
in detail, the nature of the condition or event, the period during which it
has existed and the action which the Borrower has taken, is taking, or
proposes to take with respect to each such condition or event:
____________________________________________________________________
____________________________________________________________________
____________________________________________________________________
____________________________________________________________________
The foregoing certifications are made and delivered this ____ day of ___
__________, 19___.
________________________________
EXHIBIT "D"
ASSIGNMENT AGREEMENT
This Assignment Agreement (this "Assignment Agreement") between _______
_______________ (the "Assignor") and _______________________________(the
"Assignee") is dated as of _________, 19__. The parties hereto agree as
follows:
1. PRELIMINARY STATEMENT. The Assignor is a party to a Credit
Agreement (which, as it may be amended, modified, renewed or extended from
time to time is herein called the "Credit Agreement") described in Item 1 of
Schedule 1 attached hereto ("Schedule 1"). Capitalized terms used herein and
not otherwise defined herein shall have the meanings attributed to them in the
Credit Agreement.
2. ASSIGNMENT AND ASSUMPTION. The Assignor hereby sells and assigns to
the Assignee, and the Assignee hereby purchases and assumes from the Assignor,
an interest in and to the Assignor's rights and obligations under the Credit
Agreement such that after giving effect to such assignment the Assignee shall
have purchased pursuant to this Assignment Agreement the percentage interest
specified in Item 3 of Schedule 1 of all outstanding rights and obligations
under the Credit Agreement relating to the facilities listed in Item 3 of
Schedule 1 and the other Loan Documents. The aggregate Commitment (or Loans,
if the applicable Commitment has been terminated) purchased by the Assignee
hereunder is set forth in Item 4 of Schedule 1.
3. EFFECTIVE DATE. The effective date of this Assignment Agreement
(the "Effective Date") shall be the later of the date specified in Item 5 of
Schedule 1 or two Business Days (or such shorter period agreed to by the
Agent) after a Notice of Assignment substantially in the form of Exhibit "I"
attached hereto has been delivered to the Agent. Such Notice of Assignment
must include any consents required to be delivered to the Agent by Section
12.3.1 of the Credit Agreement. In no event will the Effective Date occur if
the payments required to be made by the Assignee to the Assignor on the
Effective Date under Sections 4 and 5 hereof are not made on the proposed
Effective Date. The Assignor will notify the Assignee of the proposed
Effective Date no later than the Business Day prior to the proposed Effective
Date. As of the Effective Date, (i) the Assignee shall have the rights and
obligations of a Lender under the Loan Documents with respect to the rights
and obligations assigned to the Assignee hereunder and (ii) the Assignor shall
relinquish its rights and be released from its corresponding obligations under
the Loan Documents with respect to the rights and obligations assigned to the
Assignee hereunder.
4. PAYMENTS OBLIGATIONS. On and after the Effective Date, the Assignee
shall be entitled to receive from the Agent all payments of principal,
interest and fees with respect to the interest assigned hereby. The Assignee
shall advance funds directly to the Agent with respect to all Loans and
reimbursement payments made on or after the Effective Date with respect to the
interest assigned hereby. [In consideration for the sale and assignment of
Loans hereunder, (i) the Assignee shall pay the Assignor, on the Effective
Date, an amount equal to the principal amount of the portion of all Floating
Rate Loans assigned to the Assignee hereunder and (ii) with respect to each
Eurodollar Loan made by the Assignor and assigned to the Assignee hereunder
which is outstanding on the Effective Date, (a) on the last day of the
Interest Period therefor or (b) on such earlier date agreed to by the Assignor
and the Assignee or (c) on the date on which any such Eurodollar Loan either
becomes due (by acceleration or otherwise) or is prepaid (the date as
described in the foregoing clauses (a), (b) or (c) being hereinafter referred
to as the "Payment Date"), the Assignee shall pay the Assignor an amount equal
to the principal amount of the portion of such Eurodollar Loan assigned to the
Assignee which is outstanding on the Payment Date. If the Assignor and the
Assignee agree that the Payment Date for such Eurodollar Loan shall be the
Effective Date, they shall agree to the interest rate applicable to the
portion of such Loan assigned hereunder for the period from the Effective Date
to the end of the existing Interest Period applicable to such Eurodollar Loan
(the "Agreed Interest Rate") and any interest received by the Assignee in
excess of the Agreed Interest Rate shall be remitted to the Assignor. In the
event interest for the period from the Effective Date to but not including the
Payment Date is not paid by the Borrower with respect to any Eurodollar Loan
sold by the Assignor to the Assignee hereunder, the Assignee shall pay to the
Assignor interest for such period on the portion of such Eurodollar Loan sold
by the Assignor to the Assignee hereunder at the applicable rate provided by
the Credit Agreement. In the event a prepayment of any Eurodollar Loan which
is existing on the Payment Date and assigned by the Assignor to the Assignee
hereunder occurs after the Payment Date but before the end of the Interest
Period applicable to such Eurodollar Loan, the Assignee shall remit to the
Assignor the excess of the prepayment penalty paid with respect to the portion
of such Eurodollar Loan assigned to the Assignee hereunder over the amount
which would have been paid if such prepayment penalty was calculated based on
the Agreed Interest Rate. The Assignee will also promptly remit to the
Assignor (i) any principal payments received from the Agent with respect to
Eurodollar Loans prior to the Payment Date and (ii) any amounts of interest on
Loans and fees received from the Agent which relate to the portion of the
Loans assigned to the Assignee hereunder for periods prior to the Effective
Date, in the case of Floating Rate Loans or fees, or the Payment Date, in the
case of Eurodollar Loans, and not previously paid by the Assignee to the
Assignor.]** In the event that either party hereto receives any payment to
which the other party hereto is entitled under this Assignment Agreement, then
the party receiving such amount shall promptly remit it to the other party
hereto.
5. FEES PAYABLE BY THE ASSIGNEE. The Assignee shall pay to the
Assignor a fee on each day on which a payment of interest is made under the
Credit Agreement with respect to the amounts assigned to the Assignee
hereunder (other than a payment of interest or commitment fees for the period
prior to the Effective Date or, in the case of Eurodollar Loans, the Payment
Date, which the Assignee is obligated to deliver to the Assignor pursuant to
Section 4 hereof). The amount of such fee shall be the difference between (i)
the interest paid with respect to the amounts assigned to the Assignee
___________
* Each Assignor may insert its standard payment provisions in lieu of the
payment terms included in this Exhibit.
hereunder and (ii) the interest or fee, as applicable, which would have been
paid with respect to the amounts assigned to the Assignee hereunder if each
interest rate was of 1% less than the interest rate paid by the Borrower.
In addition, the Assignee agrees to pay % of the recordation fee required
to be paid to the Agent in connection with this Assignment Agreement.
6. REPRESENTATIONS OF THE ASSIGNOR; LIMITATIONS ON THE ASSIGNOR'S
LIABILITY. The Assignor represents and warrants that it is the legal and
beneficial owner of the interest being assigned by it hereunder and that such
interest is free and clear of any adverse claim created by the Assignor. It
is understood and agreed that the assignment and assumption hereunder are made
without recourse to the Assignor and that the Assignor makes no other
representation or warranty of any kind to the Assignee. Neither the Assignor
nor any of its officers, directors, employees, agents or attorneys shall be
responsible for (i) the due execution, legality, validity, enforceability,
genuineness, sufficiency or collectability of any Loan Document, including
without limitation, documents granting the Assignor and the other Lenders a
security interest in assets of the Borrower or any guarantor, (ii) any
representation, warranty or statement made in or in connection with any of the
Loan Documents, (iii) the financial condition or creditworthiness of the
Borrower or any guarantor, (iv) the performance of or compliance with any of
the terms or provisions of any of the Loan Documents, (v) inspecting any of
the Property, books or records of the Borrower, (vi) the validity,
enforceability, perfection, priority, condition, value or sufficiency of any
collateral securing or purporting to secure the Loans or (vii) any mistake,
error of judgment, or action taken or omitted to be taken in connection with
the Loans or the Loan Documents.
7. REPRESENTATIONS OF THE ASSIGNEE. The Assignee (i) confirms that it
has received a copy of the Credit Agreement, together with copies of the
financial statements requested by the Assignee and such other documents and
information as it has deemed appropriate to make its own credit analysis and
decision to enter into this Assignment Agreement, (ii) agrees that it will,
independently and without reliance upon the Agent, the Assignor or any other
Lender and based on such documents and information at it shall deem
appropriate at the time, continue to make its own credit decisions in taking
or not taking action under the Loan Documents, (iii) appoints and authorizes
the Agent to take such action as agent on its behalf and to exercise such
powers under the Loan Documents as are delegated to the Agent by the terms
thereof, together with such powers as are reasonably incidental thereto, (iv)
agrees that it will perform in accordance with their terms all of the
obligations which by the terms of the Loan Documents are required to be
performed by it as a Lender, (v) agrees that its payment instructions and
notice instructions are as set forth in the attachment to Schedule 1, (vi)
confirms that none of the funds, monies, assets or other consideration being
used to make the purchase and assumption hereunder are "plan assets" as
defined under ERISA and that its rights, benefits and interests in and under
the Loan Documents will not be "plan assets" under ERISA, [and (vii) attaches
the forms prescribed by the Internal Revenue Service of the United States
certifying that the Assignee is entitled to receive payments under the Loan
Documents without deduction or withholding of any United States federal income
taxes].**
8. INDEMNITY. The Assignee agrees to indemnify and hold the Assignor
harmless against any and all losses, costs and expenses (including, without
limitation, reasonable attorneys' fees) and liabilities incurred by the
Assignor in connection with or arising in any manner from the Assignee's
non-performance of the obligations assumed under this Assignment Agreement.
9. SUBSEQUENT ASSIGNMENTS. After the Effective Date, the Assignee
shall have the right pursuant to Section 12.3.1 of the Credit Agreement to
assign the rights which are assigned to the Assignee hereunder to any entity
or person, provided that (i) any such subsequent assignment does not violate
any of the terms and conditions of the Loan Documents or any law, rule,
regulation, order, writ, judgment, injunction or decree and that any consent
required under the terms of the Loan Documents has been obtained and (ii)
unless the prior written consent of the Assignor is obtained, the Assignee is
not thereby released from its obligations to the Assignor hereunder, if any
remain unsatisfied, including, without limitation, its obligations under
Sections 4, 5 and 8 hereof.
10. REDUCTIONS OF AGGREGATE COMMITMENT. If any reduction in the
Aggregate Commitment occurs between the date of this Assignment Agreement and
the Effective Date, the percentage interest specified in Item 3 of Schedule 1
shall remain the same, but the dollar amount purchased shall be recalculated
based on the reduced Aggregate Commitment.
11. ENTIRE AGREEMENT. This Assignment Agreement and the attached
Notice of Assignment embody the entire agreement and understanding between the
parties hereto and supersede all prior agreements and understandings between
the parties hereto relating to the subject matter hereof.
12. GOVERNING LAW. This Assignment Agreement shall be governed by the
internal law, and not the law of conflicts, of the State of Illinois.
13. NOTICES. Notices shall be given under this Assignment Agreement in
the manner set forth in the Credit Agreement. For the purpose hereof, the
addresses of the parties hereto (until notice of a change is delivered) shall
be the address set forth in the attachment to Schedule 1.
** to be inserted if the Assignee is not incorporated under the laws of the
United States, or a state thereof.
IN WITNESS WHEREOF, the parties hereto have executed this Assignment
Agreement by their duly authorized officers as of the date first above
written.
[NAME OF ASSIGNOR]
By: ________________________________
Title: _____________________________
_____________________________
_____________________________
[NAME OF ASSIGNEE]
By: ________________________________
Title: _____________________________
_____________________________
_____________________________
SCHEDULE 1
to Assignment Agreement
1. Description and Date of Credit Agreement:
Term Credit Agreement dated March 14, 1996 by and among Pennsylvania
Power & Light Company, The First National Bank of Chicago, individually
and as Agent, and the Lenders party thereto.
2. Date of Assignment Agreement: _____________, 19__
3. Amounts (As of Date of Item 2 above):
a. Total of Commitments
(Loans)* under
Credit Agreement $______
b. Assignee's Percentage
of Facility purchased
under the Assignment
Agreement** _______%
c. Amount of Assigned Share in
Facility purchased under
the Assignment
Agreement $______
4. Assignee's Aggregate (Loan
Amount)* Commitment Amount
Purchased Hereunder: $______
5. Proposed Effective Date: _______________
Accepted and Agreed:
[NAME OF ASSIGNOR] [NAME OF ASSIGNEE]
By: __________________________________ By: _______________________________
Title: _______________________________ Title: ____________________________
* If a Commitment has been terminated, insert outstanding Loans in place of
Commitment
** Percentage taken to 10 decimal places
Attachment to SCHEDULE 1 to ASSIGNMENT AGREEMENT
Attach Assignor's Administrative Information Sheet, which must
include notice address for the Assignor and the Assignee
EXHIBIT "I"
to Assignment Agreement
NOTICE
OF ASSIGNMENT
____________________, 19__
To: PENNSYLVANIA POWER & LIGHT COMPANY
Two North Ninth Street
Allentown, Pennsylvania 18101-1179
Attention: Treasurer
THE FIRST NATIONAL BANK OF
CHICAGO, as Agent
One First National Plaza
Chicago, Illinois 60670
Attention: Electric, Gas & Telecommunications Division
From: [NAME OF ASSIGNOR] (the "Assignor")
[NAME OF ASSIGNEE] (the "Assignee")
1. We refer to that Term Credit Agreement (the "Credit Agreement")
described in Item 1 of Schedule 1 attached hereto ("Schedule 1"). Capitalized
terms used herein and not otherwise defined herein shall have the meanings
attributed to them in the Credit Agreement.
2. This Notice of Assignment (this "Notice") is given and delivered
to the Borrower and the Agent pursuant to Section 12.3.2 of the Credit
Agreement.
3. The Assignor and the Assignee have entered into an Assignment
Agreement, dated as of , 19 (the "Assignment"), pursuant to
which, among other things, the Assignor has sold, assigned, delegated and
transferred to the Assignee, and the Assignee has purchased, accepted and
assumed from the Assignor the percentage interest specified in Item 3 of
Schedule 1 of all outstandings, rights and obligations under the Credit
Agreement relating to the facilities listed in Item 3 of Schedule 1. The
Effective Date of the Assignment shall be the later of the date specified in
Item 5 of Schedule 1 or two Business Days (or such shorter period as agreed to
by the Agent) after this Notice of Assignment and any consents and fees
required by Sections 12.3.1 and 12.3.2 of the Credit Agreement have been
delivered to the Agent, provided that the Effective Date shall not occur if
any condition precedent agreed to by the Assignor and the Assignee has not
been satisfied.
4. The Assignor and the Assignee hereby give to the Borrower and the
Agent notice of the assignment and delegation referred to herein. The
Assignor will confer with the Agent before the date specified in Item 5 of
Schedule 1 to determine if the Assignment Agreement will become effective on
such date pursuant to Section 3 hereof, and will confer with the Agent to
determine the Effective Date pursuant to Section 3 hereof if it occurs
thereafter. The Assignor shall notify the Agent if the Assignment Agreement
does not become effective on any proposed Effective Date as a result of the
failure to satisfy the conditions precedent agreed to by the Assignor and the
Assignee. At the request of the Agent, the Assignor will give the Agent
written confirmation of the satisfaction of the conditions precedent.
5. The Assignor or the Assignee shall pay to the Agent on or before
the Effective Date the processing fee of $3,500 required by Section 12.3.2 of
the Credit Agreement.
6. If Notes are outstanding on the Effective Date, the Assignor and
the Assignee request and direct that the Agent prepare and cause the Borrower
to execute and deliver new Notes or, as appropriate, replacements notes, to
the Assignor and the Assignee. The Assignor and, if applicable, the Assignee
each agree to deliver to the Agent the original Note received by it from the
Borrower upon its receipt of a new Note in the appropriate amount.
7. The Assignee advises the Agent that notice and payment
instructions are set forth in the attachment to Schedule 1.
8. The Assignee hereby represents and warrants that none of the
funds, monies, assets or other consideration being used to make the purchase
pursuant to the Assignment are "plan assets" as defined under ERISA and that
its rights, benefits, and interests in and under the Loan Documents will not
be "plan assets" under ERISA.
9. The Assignee authorizes the Agent to act as its agent under the
Loan Documents in accordance with the terms thereof. The Assignee
acknowledges that the Agent has no duty to supply information with respect to
the Borrower or the Loan Documents to the Assignee until the Assignee becomes
a party to the Credit Agreement.*
NAME OF ASSIGNOR NAME OF ASSIGNEE
By:_____________________________ By: ___________________________________
Title: _________________________ Title: ________________________________
ACKNOWLEDGED AND CONSENTED TO ACKNOWLEDGED AND CONSENTED TO
BY THE FIRST NATIONAL BANK OF BY PENNSYLVANIA POWER & LIGHT
CHICAGO COMPANY
By: ____________________________ By: ____________________________________
Title: _________________________ Title: _________________________________
[Attach photocopy of Schedule 1 to Assignment]
* May be eliminated if Assignee is a party to the Credit Agreement prior to
the Effective Date.
EXHIBIT "E"
LOAN/CREDIT RELATED MONEY TRANSFER INSTRUCTION
To The First National Bank of Chicago,
as Agent (the "Agent") under the Credit Agreement
Described Below.
Re: Term Credit Agreement, dated March 14, 1996 (as the same may be amended
or modified, the "Credit Agreement"), among Pennsylvania Power & Light
Company (the "Borrower"), the Agent, and the Lenders named therein.
Terms used herein and not otherwise defined shall have the meanings
assigned thereto in the Credit Agreement.
The Agent is specifically authorized and directed to act upon the
following standing money transfer instructions with respect to the proceeds of
Advances or other extensions of credit from time to time until receipt by the
Agent of a specific written revocation of such instructions by the Borrower,
provided, however, that the Agent may otherwise transfer funds as hereafter
directed in writing by the Borrower in accordance with Section 13.1 of the
Credit Agreement or based on any telephonic notice made in accordance with
Section 2.12 of the Credit Agreement.
Facility Identification Number(s)__________________________________________
Customer/Account Name _____________________________________________________
Transfer Funds To _________________________________________________________
_______________________________________________________
_______________________________________________________
For Account No. ___________________________________________________________
Reference/Attention To ____________________________________________________
Authorized Officer (Customer Representative) Date ______________________
______________________________ ______________________________________
(Please Print) Signature
Bank Officer Name Date _________________________________
______________________________ ______________________________________
(Please Print) Signature
(Deliver Completed Form to Credit Support Staff For Immediate Processing)
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