Exhibit 4-1
$275,000,000 REVOLVING CREDIT FACILITY
CREDIT AGREEMENT
BY AND AMONG
NEW JERSEY RESOURCES CORPORATION
AND
THE BANKS PARTY HERETO
AND
PNC BANK, NATIONAL ASSOCIATION,
AS ADMINISTRATIVE AGENT
AND
JPMORGAN CHASE BANK NA AND
FLEET NATIONAL BANK,
AS SYNDICATION AGENTS
AND
BANK OF TOKYO-MITSUBISHI TRUST COMPANY AND
CITICORP NORTH AMERICA, INC.,
AS DOCUMENTATION AGENTS
AND
PNC CAPITAL MARKETS, INC.,
AS LEAD ARRANGER
DATED AS OF DECEMBER 16, 2004
1. CERTAIN DEFINITIONS.................................................................... 1
1.1 Certain Definitions........................................................... 1
1.2 Construction.................................................................. 22
1.2.1. Number; Inclusion.................................................. 22
1.2.2. Determination...................................................... 22
1.2.3. Agent's Discretion and Consent..................................... 22
1.2.4. Documents Taken as a Whole......................................... 23
1.2.5. Headings........................................................... 23
1.2.6. Implied References to this Agreement............................... 23
1.2.7. Persons............................................................ 23
1.2.8. Modifications to Documents......................................... 23
1.2.9. From, To and Through............................................... 23
1.2.10. Shall; Will........................................................ 23
1.3 Accounting Principles......................................................... 23
2. REVOLVING CREDIT AND SWING LOAN FACILITIES............................................. 24
2.1 Commitments................................................................... 24
2.1.1. Revolving Credit Loans............................................. 24
2.1.2. Swing Loan Commitment.............................................. 24
2.2 Nature of Banks' Obligations with Respect to Revolving Credit Loans........... 25
2.3 Facility Fees................................................................. 25
2.4 Revolving Credit Loan Requests................................................ 25
2.5 Swing Loan Requests........................................................... 26
2.6 Making Revolving Credit Loans and Swing Loans................................. 26
2.6.1. Making Revolving Credit Loans...................................... 26
2.6.2. Making Swing Loans................................................. 26
2.7 Swing Loan Note............................................................... 27
2.8 Use of Proceeds............................................................... 27
2.9 Letter of Credit Subfacility.................................................. 27
2.9.1. Issuance of Letters of Credit...................................... 27
2.9.2. Letter of Credit Fees.............................................. 27
2.9.3. Disbursements, Reimbursement....................................... 28
2.9.4. Repayment of Participation Advances................................ 29
2.9.5. Documentation...................................................... 29
2.9.6. Determinations to Honor Drawing Requests........................... 30
2.9.7. Nature of Participation and Reimbursement Obligations.............. 30
2.9.8. Indemnity.......................................................... 32
2.9.9. Liability for Acts and Omissions................................... 32
2.10 Borrowings to Repay Swing Loans............................................... 34
2.11 Right to Increase Commitments................................................. 34
3. INTENTIONALLY OMITTED..................................................................... 35
4. INTEREST RATES............................................................................ 35
4.1 Interest Rate Options............................................................ 35
4.1.1. Revolving Credit Interest Rate Options................................ 35
4.1.2. Rate Quotations....................................................... 35
4.1.3. Change in Fees or Interest Rates...................................... 36
4.2 Interest Periods................................................................. 36
4.2.1. Amount of Borrowing Tranche........................................... 36
4.2.2. Renewals.............................................................. 36
4.3 Interest After Default........................................................... 36
4.3.1. Letter of Credit Fees, Interest Rate.................................. 37
4.3.2. Other Obligations..................................................... 37
4.3.3. Acknowledgment........................................................ 37
4.4 Euro-Rate Unascertainable; Illegality; Increased Costs; Deposits Not Available .. 37
4.4.1. Unascertainable....................................................... 37
4.4.2. Illegality; Increased Costs; Deposits Not Available................... 37
4.4.3. Agent's and Bank's Rights............................................. 38
4.5 Selection of Interest Rate Options............................................... 38
5. PAYMENTS.................................................................................. 39
5.1 Payments......................................................................... 39
5.2 Pro Rata Treatment of Banks...................................................... 39
5.3 Interest Payment Dates........................................................... 39
5.4 Prepayments...................................................................... 40
5.4.1. Voluntary Prepayments................................................. 40
5.4.2. Replacement of a Bank................................................. 41
5.4.3. Change of Lending Office.............................................. 41
5.5 Voluntary Commitment Reductions.................................................. 42
5.6 Additional Compensation in Certain Circumstances................................. 42
5.6.1. Increased Costs or Reduced Return Resulting From Taxes, Reserves,
Capital Adequacy Requirements, Expenses, Etc.......................... 42
5.6.2. Indemnity............................................................. 43
5.7 Interbank Market Presumption..................................................... 44
5.8 Taxes............................................................................ 44
5.8.1. No Deductions......................................................... 44
5.8.2. Stamp Taxes........................................................... 44
5.8.3. Indemnification for Taxes Paid by a Bank.............................. 44
5.8.4. Certificate........................................................... 45
5.8.5. Survival.............................................................. 45
5.9 Notes............................................................................ 45
5.10 Settlement Date Procedures....................................................... 45
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6. REPRESENTATIONS AND WARRANTIES.............................................................. 46
6.1 Representations and Warranties..................................................... 46
6.1.1. Organization and Qualification.......................................... 46
6.1.2. Subsidiaries............................................................ 46
6.1.3. Power and Authority..................................................... 46
6.1.4. Validity and Binding Effect............................................. 47
6.1.5. No Conflict............................................................. 47
6.1.6. Litigation.............................................................. 47
6.1.7. Title to Properties..................................................... 47
6.1.8. Financial Statements.................................................... 48
6.1.9. Use of Proceeds; Margin Stock; Section 20 Subsidiaries.................. 48
6.1.10. Full Disclosure......................................................... 49
6.1.11. Taxes................................................................... 49
6.1.12. Consents and Approvals.................................................. 49
6.1.13. No Event of Default; Compliance With Instruments........................ 50
6.1.14. Patents, Trademarks, Copyrights, Licenses, Etc.......................... 50
6.1.15. Insurance............................................................... 50
6.1.16. Compliance With Laws.................................................... 50
6.1.17. Material Contracts; Burdensome Restrictions............................. 50
6.1.18. Investment Companies; Regulated Entities................................ 51
6.1.19. Plans and Benefit Arrangements.......................................... 51
6.1.20. Employment Matters...................................................... 52
6.1.21. Environmental Matters................................................... 52
6.1.22. Senior Debt Status...................................................... 53
6.1.23. Hedging Contract Policies............................................... 53
6.1.24. Permitted Related Business Opportunities................................ 53
6.1.25. Anti-Terrorism Laws; Executive Order No. 13224.......................... 53
6.2 Continuation of Representations.................................................... 54
7. CONDITIONS OF LENDING AND ISSUANCE OF LETTERS OF CREDIT..................................... 54
7.1 Conditions to First Loans and Letters of Credit.................................... 54
7.1.1. Officer's Certificate................................................... 54
7.1.2. Secretary's Certificate................................................. 55
7.1.3. Opinion of Counsel...................................................... 55
7.1.4. Legal Details........................................................... 55
7.1.5. Payment of Fees......................................................... 56
7.1.6. Consents................................................................ 56
7.1.7. Officer's Certificate Regarding MACs.................................... 56
7.1.8. No Violation of Laws.................................................... 56
7.1.9. No Actions or Proceedings............................................... 56
7.1.10. Delivery of Guaranty Agreements......................................... 56
7.1.11. Hedging Contract Policies............................................... 56
7.1.12. Termination of Commitments and Repayment of Outstanding Indebtedness ... 57
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7.2 Each Additional Loan or Letter of Credit.................................. 57
8. COVENANTS............................................................................ 57
8.1 Affirmative Covenants..................................................... 57
8.1.1. Preservation of Existence, Etc. ............................... 57
8.1.2. Payment of Liabilities, Including Taxes, Etc. ................. 58
8.1.3. Maintenance of Insurance....................................... 58
8.1.4. Maintenance of Properties and Leases........................... 58
8.1.5. Maintenance of Patents, Trademarks, Etc. ...................... 58
8.1.6. Visitation Rights.............................................. 58
8.1.7. Keeping of Records and Books of Account........................ 59
8.1.8. Plans and Benefit Arrangements................................. 59
8.1.9. Compliance With Laws........................................... 59
8.1.10. Use of Proceeds................................................ 60
8.1.11. Hedging Contract Policies...................................... 60
8.2 Negative Covenants........................................................ 60
8.2.1. Indebtedness................................................... 60
8.2.2. Liens.......................................................... 62
8.2.3. Guaranties..................................................... 63
8.2.4. Loans and Investments.......................................... 64
8.2.5. Liquidations, Mergers, Consolidations, Acquisitions............ 64
8.2.6. Dispositions of Assets or Subsidiaries......................... 65
8.2.7. Affiliate Transactions......................................... 66
8.2.8. Subsidiaries, Partnerships and Joint Ventures.................. 66
8.2.9. Continuation of or Change in Business.......................... 67
8.2.10. Plans and Benefit Arrangements................................. 67
8.2.11. Fiscal Year.................................................... 67
8.2.12. Maximum Leverage Ratio......................................... 67
8.2.13. Minimum Interest Coverage Ratio................................ 68
8.2.14. No Limitation on Dividends and Distributions by Subsidiaries... 68
8.2.15. Payment of Dividends; Redemptions.............................. 68
8.2.16. No Modification of Hedging Contract Policies................... 68
8.2.17. Off-Balance Sheet Financing.................................... 68
8.2.18. Amendments to NJR Note Agreement and NJNG Note Agreement....... 69
8.2.19. No Violation of Anti-Terrorism Laws............................ 70
8.3 Reporting Requirements.................................................... 70
8.3.1. Quarterly Financial Statements................................. 70
8.3.2. Annual Financial Statements.................................... 71
8.3.3. Certificate of the Borrower.................................... 71
8.3.4. Notice of Default.............................................. 71
8.3.5. Notice of Litigation........................................... 72
8.3.6. Notice of Change in Debt Rating................................ 72
8.3.7. Sale of Assets................................................. 72
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8.3.8. Budgets, Forecasts, Other Reports and Information.............. 72
8.3.9. Notices Regarding Plans and Benefit Arrangements............... 73
9. DEFAULT.............................................................................. 74
9.1 Events of Default......................................................... 74
9.1.1. Payments Under Loan Documents.................................. 74
9.1.2. Breach of Warranty............................................. 75
9.1.3. Breach of Negative Covenants or Visitation Rights.............. 75
9.1.4. Breach of Other Covenants...................................... 75
9.1.5. Defaults in Other Agreements or Indebtedness................... 75
9.1.6. Final Judgments or Orders...................................... 76
9.1.7. Loan Document Unenforceable.................................... 76
9.1.8. Uninsured Losses; Proceedings Against Assets................... 76
9.1.9. Notice of Lien or Assessment................................... 76
9.1.10. Insolvency..................................................... 77
9.1.11. Events Relating to Plans and Benefit Arrangements.............. 77
9.1.12. Cessation of Business.......................................... 77
9.1.13. Change of Control.............................................. 78
9.1.14. Involuntary Proceedings........................................ 78
9.1.15. Voluntary Proceedings.......................................... 78
9.2 Consequences of Event of Default.......................................... 79
9.2.1. Events of Default Other Than Bankruptcy, Insolvency
or Reorganization Proceedings.................................. 79
9.2.2. Bankruptcy, Insolvency or Reorganization Proceedings........... 79
9.2.3. Set-off........................................................ 79
9.2.4. Suits, Actions, Proceedings.................................... 80
9.2.5. Application of Proceeds; Collateral Sharing.................... 80
9.2.6. Other Rights and Remedies...................................... 81
10. THE AGENT............................................................................ 81
10.1 Appointment............................................................... 81
10.2 Delegation of Duties...................................................... 81
10.3 Nature of Duties; Independent Credit Investigation........................ 82
10.4 Actions in Discretion of Agent; Instructions From the Banks............... 82
10.5 Reimbursement and Indemnification of Agent by the Borrower................ 83
10.6 Exculpatory Provisions; Limitation of Liability........................... 83
10.7 Reimbursement and Indemnification of Agent by Banks....................... 84
10.8 Reliance by Agent......................................................... 85
10.9 Notice of Default......................................................... 85
10.10 Notices................................................................... 85
10.11 Banks in Their Individual Capacities; Agents in Its Individual Capacity... 85
10.12 Holders of Notes.......................................................... 86
10.13 Equalization of Banks..................................................... 86
10.14 Successor Agent........................................................... 86
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10.15 Agent's Fee................................................................. 87
10.16 Availability of Funds....................................................... 87
10.17 Calculations................................................................ 87
10.18 Beneficiaries............................................................... 88
10.19 No Reliance on Agent's Customer Identification Program...................... 88
11. MISCELLANEOUS........................................................................ 88
11.1 Modifications, Amendments or Waivers........................................ 88
11.1.1. Increase of Revolving Credit Commitments; Extension of
Expiration Date.................................................. 88
11.1.2. Release of Collateral or Guarantor............................... 89
11.1.3. Miscellaneous.................................................... 89
11.2 No Implied Waivers; Cumulative Remedies; Writing Required................... 89
11.3 Reimbursement and Indemnification of Banks by the Borrower; Taxes........... 90
11.4 Holidays.................................................................... 91
11.5 Funding by Branch, Subsidiary or Affiliate.................................. 91
11.5.1. Notional Funding................................................. 91
11.5.2. Actual Funding................................................... 91
11.6 Notices; Lending Offices.................................................... 92
11.7 Severability................................................................ 93
11.8 Governing Law............................................................... 93
11.9 Prior Understanding......................................................... 93
11.10 Duration; Survival.......................................................... 93
11.11 Successors and Assigns; Joinder of a Bank................................... 94
11.12 Confidentiality............................................................. 96
11.12.1. General.......................................................... 96
11.12.2. Sharing Information With Affiliates of the Banks................. 96
11.13 Counterparts................................................................ 96
11.14 Agent's or Bank's Consent................................................... 97
11.15 Exceptions.................................................................. 97
11.16 WAIVER OF JURY TRIAL........................................................ 97
11.17 JURISDICTION & VENUE........................................................ 97
11.18 Certifications From Banks and Participants.................................. 98
11.18.1. Tax Withholding.................................................. 98
11.18.2. USA Patriot Act.................................................. 99
11.19 Joinder of Guarantors....................................................... 99
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LIST OF SCHEDULES AND EXHIBITS
SCHEDULES
SCHEDULE 1.1(A) - PRICING GRID
SCHEDULE 1.1(B) - COMMITMENTS OF BANKS AND ADDRESSES
FOR NOTICES
SCHEDULE 1.1(P) - PERMITTED LIENS
SCHEDULE 2.9.1 - EXISTING LETTERS OF CREDIT
SCHEDULE 6.1.2 - SUBSIDIARIES
SCHEDULE 6.1.12 - CONSENTS AND APPROVALS
SCHEDULE 6.1.23 - HEDGING CONTRACT POLICIES
SCHEDULE 6.1.24 - PERMITTED BUSINESS OPPORTUNITIES
SCHEDULE 8.2.1 - EXISTING INDEBTEDNESS
EXHIBITS
EXHIBIT 1.1(A) - ASSIGNMENT AND ASSUMPTION AGREEMENT
EXHIBIT 1.1(B) - BANK JOINDER
EXHIBIT 1.1(G)(1) - GUARANTOR JOINDER
EXHIBIT 1.1(G)(2) - GUARANTY AGREEMENT
EXHIBIT 1.1(R) - REVOLVING CREDIT NOTE
EXHIBIT 1.1(S) - SWING LOAN NOTE
EXHIBIT 2.4 - LOAN REQUEST
EXHIBIT 2.5 - SWING LOAN REQUEST
EXHIBIT 5.5 - COMMITMENT REDUCTION NOTICE
EXHIBIT 7.1.3(A) - OPINION OF COUNSEL
EXHIBIT 7.1.3(B) - OPINION OF IN-HOUSE COUNSEL
EXHIBIT 8.2.5 - ACQUISITION COMPLIANCE CERTIFICATE
EXHIBIT 8.3.3 - COMPLIANCE CERTIFICATE
CREDIT AGREEMENT
THIS CREDIT AGREEMENT is dated as of December 16, 2004 and is made by and
among NEW JERSEY RESOURCES CORPORATION, a New Jersey corporation (the
"Borrower"), EACH OF THE GUARANTORS (as hereinafter defined), the BANKS (as
hereinafter defined), JPMORGAN CHASE BANK NA and FLEET NATIONAL BANK, each in
its capacity as a syndication agent, BANK OF TOKYO-MITSUBISHI TRUST COMPANY and
CITICORP NORTH AMERICA, INC., each in its capacity as a documentation agent, and
PNC BANK, NATIONAL ASSOCIATION, in its capacity as administrative agent for the
Banks under this Agreement (hereinafter referred to in such capacity as the
"Agent").
WITNESSETH:
WHEREAS, the Borrower has requested the Banks to provide a revolving
credit facility to the Borrower in an aggregate principal amount not to exceed
$275,000,000; and
WHEREAS, the revolving credit facility shall be used for refinancing
existing indebtedness and general corporate purposes of the Borrower; and
WHEREAS, the Banks are willing to provide such credit upon the terms and
conditions hereinafter set forth;
NOW, THEREFORE, the parties hereto, in consideration of their mutual
covenants and agreements hereinafter set forth and intending to be legally bound
hereby, covenant and agree as follows:
1. CERTAIN DEFINITIONS
1.1 Certain Definitions.
In addition to words and terms defined elsewhere in this Agreement,
the following words and terms shall have the following meanings, respectively,
unless the context hereof clearly requires otherwise:
Acquired Person shall mean a Person or business acquired by
any Loan Party in a transaction which is a Permitted Acquisition.
Acquisition Compliance Certificate shall have the meaning
assigned to that term in Section 8.2.5.
Additional Bank shall have the meaning assigned to that term
in Section 11.11(iv).
Affiliate as to any Person shall mean any other Person (i) which
directly or indirectly controls, is controlled by, or is under common control
with such Person, (ii) which beneficially owns or holds 10% or more of any class
of the voting or other equity interests of such Person, or (iii) 10% or more of
any class of voting interests or other equity interests of which is beneficially
owned or held, directly or indirectly, by such Person. Control, as used in this
definition, shall mean the possession, directly or indirectly, of the power to
direct or cause the direction of the management or policies of a Person, whether
through the ownership of voting securities, by contract or otherwise, including
the power to elect a majority of the directors or trustees of a corporation or
trust, as the case may be.
Agent shall mean PNC Bank, National Association, and its successors
and assigns.
Agent's Fee shall have the meaning assigned to that term in Section
10.15.
Agent's Letter shall have the meaning assigned to that term in
Section 10.15.
Agreement shall mean this Credit Agreement, as the same may be
supplemented or amended from time to time, including all schedules and exhibits.
Anti-Terrorism Laws shall mean any Laws relating to terrorism or
money laundering, including Executive Order No. 13224, the USA Patriot Act, the
Laws comprising or implementing the Bank Secrecy Act, and the Laws administered
by the United States Treasury Department's Office of Foreign Asset Control (as
any of the foregoing Laws may from time to time be amended, renewed, extended,
or replaced).
Applicable Facility Fee Rate shall mean the percentage rate per
annum at the indicated level of Debt Rating in the pricing grid on Schedule
1.1(A) below the heading "Facility Fee." The Applicable Facility Fee Rate shall
be computed in accordance with the parameters set forth on Schedule 1.1(A).
Applicable Letter of Credit Fee Rate shall mean the percentage rate
per annum at the indicated level of Debt Rating in the pricing grid on Schedule
1.1(A) below the heading "Letter of Credit Fee." The Applicable Letter of Credit
Fee Rate shall be computed in accordance with the parameters set forth on
Schedule 1.1(A).
Applicable Margin shall mean, as applicable:
(A) the percentage spread to be added to Base Rate under the Base
Rate Option at the indicated level of Debt Rating in the pricing grid on
Schedule 1.1(A) below the heading "Base Rate Spread" or
(B) the percentage spread to be added to Euro-Rate under the
Euro-Rate Option at the indicated level of Debt Rating in the pricing grid on
Schedule 1.1(A) below the heading "Euro-Rate Spread."
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The Applicable Margin shall be computed in accordance with the
parameters set forth on Schedule 1.1(A).
Approved Fund shall mean, with respect to any Bank, any Person
(other than a natural person) that is engaged in making, purchasing, holding or
investing in bank loans and similar extensions of credit in the ordinary course
of its business and that is administered by such Bank, an Affiliate of such Bank
or an entity or an Affiliate of an entity that administers or manages such Bank.
Assignment and Assumption Agreement shall mean an Assignment and
Assumption Agreement by and among a Purchasing Bank, a Transferor Bank and the
Agent, as Agent and on behalf of the remaining Banks, substantially in the form
of Exhibit 1.1(A).
Authorized Officer shall mean those individuals, designated by
written notice to the Agent from the Borrower, authorized to execute notices,
reports and other documents on behalf of the Loan Parties required hereunder.
The Borrower may amend such list of individuals from time to time by giving
written notice of such amendment to the Agent.
Bank Joinder shall mean a Bank Joinder substantially in the form of
Exhibit 1.1(B).
Bank Provided Interest Rate Hedge shall mean an Interest Rate Hedge
which is provided by any Bank and that meets the following requirements: such
Interest Rate Hedge (i) is documented in a standard International Swap Dealer
Association Agreement, (ii) provides for the method of calculating the
reimbursable amount of the provider's credit exposure in a reasonable and
customary manner, and (iii) is entered into for hedging (rather than
speculative) purposes. The liabilities of the Loan Parties to the provider of
any Bank-Provided Interest Rate Hedge shall be "Obligations" hereunder,
guaranteed obligations under the Guaranty Agreement and otherwise treated as
Obligations for purposes of each of the other Loan Documents.
Banks shall mean the financial institutions named on Schedule 1.1(B)
and their respective successors and assigns as permitted hereunder, each of
which is referred to herein as a Bank.
Base Rate shall mean the greater of (i) the interest rate per annum
announced from time to time by the Agent at its Principal Office as its then
prime rate, which rate may not be the lowest rate then being charged commercial
borrowers by the Agent, or (ii) the Federal Funds Open Rate plus 1/2% per annum.
Base Rate Option shall mean the option of the Borrower to have
Revolving Credit Loans bear interest at the rate and under the terms and
conditions set forth in Section 4.1.1(i).
Benefit Arrangement shall mean at any time an "employee benefit
plan" within the meaning of Section 3(3) of ERISA, which is neither a Plan nor a
Multiemployer Plan
3
and which is maintained, sponsored or otherwise contributed to by any member of
the ERISA Group.
Blocked Person shall have the meaning assigned to such term in
Subsection 6.1.25.
Borrower shall mean New Jersey Resources Corporation, a corporation
organized and existing under the laws of the State of New Jersey.
Borrowing Date shall mean, with respect to any Loan, the date for
the making thereof or the renewal or conversion thereof at or to the same or a
different Interest Rate Option, which shall be a Business Day.
Borrowing Tranche shall mean specified portions of Loans outstanding
as follows: (i) any Loans to which a Euro-Rate Option applies which become
subject to the same Interest Rate Option under the same Loan Request by the
Borrower and which have the same Interest Period shall constitute one Borrowing
Tranche, and (ii) all Loans to which a Base Rate Option applies shall constitute
one Borrowing Tranche.
Business Day shall mean any day other than a Saturday or Sunday or a
legal holiday on which commercial banks are authorized or required to be closed
for business in Pittsburgh, Pennsylvania and if the applicable Business Day
relates to any Loan to which the Euro-Rate Option applies, such day must also be
a day on which dealings are carried on in the London interbank market.
Closing Date shall mean the Business Day on which the first Loan
shall be made, which shall be December 16, 2004. The closing shall take place on
the Closing Date at such time and place as the parties agree.
Commercial Letter of Credit shall mean any letter of credit which is
issued in respect of the purchase of goods or services by one or more of the
Loan Parties in the ordinary course of their business.
Commitment shall mean, as to any Bank, its Revolving Credit
Commitment and, in the case of the Agent, its Swing Loan Commitment, and
Commitments shall mean the aggregate of the Revolving Credit Commitments and
Swing Loan Commitment of all of the Banks.
Compliance Certificate shall have the meaning assigned to such term
in Section 8.3.3.
Consideration shall mean with respect to any Permitted Acquisition,
the aggregate of (i) the cash paid by any of the Loan Parties, directly or
indirectly, to the seller in connection therewith, (ii) the Indebtedness
incurred or assumed by any of the Loan Parties, whether in favor of the seller
or otherwise and whether fixed or contingent, (iii) any Guaranty given or
incurred by any Loan Party in connection therewith, and (iv) any other
consideration given or obligation incurred by any of the Loan Parties in
connection therewith.
4
Consolidated Income from Operations for any period of determination
shall mean (i) the sum of net income (provided that there shall be excluded from
net income: (a) any extraordinary items of gain or loss (including, without
limitation, those items created by mandated changes in accounting treatment),
and (b) any gain or loss of any Person accounted for on the equity method except
to the extent of cash distributions received by the Borrower or any Subsidiary
of the Borrower during the period of determination with respect to any gain of
any Person accounted for on the equity method), depreciation, amortization,
other non-cash charges to net income, interest expense and income tax expense
minus (ii) non-cash credits to net income, in each case of the Borrower and its
Subsidiaries for such period determined and consolidated in accordance with
GAAP.
Consolidated Interest Expense for any period of determination shall
mean interest expense for such period of the Borrower and its Subsidiaries
determined on a consolidated basis in accordance with GAAP.
Consolidated Shareholders' Equity shall mean as of any date of
determination the sum of the amounts under the headings "Common Shareholders'
Equity" and "Preferred Shareholders' Equity" on the balance sheet, prepared in
accordance with GAAP, for the Borrower and its Subsidiaries on a consolidated
basis as of such date of determination.
Consolidated Total Capitalization shall mean as of any date of
determination the sum of (i) Consolidated Total Indebtedness, plus (ii)
Consolidated Shareholders' Equity.
Consolidated Total Indebtedness shall mean as of any date of
determination total Indebtedness, without duplication, of the Borrower and its
Subsidiaries.
Contamination shall mean the presence or release or threat of
release of Regulated Substances in, on, under or emanating to or from the
Property, which pursuant to Environmental Laws requires notification or
reporting to an Official Body, or which pursuant to Environmental Laws requires
the performance of a Remedial Action or which otherwise constitutes a violation
of Environmental Laws.
Debt Rating shall mean the rating of New Jersey Natural Gas's senior
secured long-term debt by each of Standard & Poor's and Moody's.
Dollar, Dollars, U.S. Dollars and the symbol $ shall mean lawful
money of the United States of America.
Drawing Date shall have the meaning assigned to that term in Section
2.9.3.2.
Environmental Complaint shall mean any (i) notice of non-compliance
or violation, citation or order relating in any way to any Environmental Law,
Environmental Permit, Contamination or Regulated Substance; (ii) civil,
criminal, administrative or regulatory investigation instituted by an Official
Body relating in any way to any Environmental Law, Environmental Permit,
Contamination or Regulated Substance; (iii) administrative, regulatory or
5
judicial action, suit, claim or proceeding instituted by any Person or Official
Body or any other written notice of liability or potential liability from any
Person or Official Body, in either instance, relating to or setting forth
allegations or a cause of action for personal injury (including but not limited
to death), property damage, natural resource damage, contribution or indemnity
for the costs associated with the performance of Remedial Actions, direct
recovery for the costs associated with the performance of Remedial Actions,
liens or encumbrances attached to or recorded or levied against property for the
costs associated with the performance of Remedial Actions, civil or
administrative penalties, criminal fines or penalties or declaratory or
equitable relief arising under any Environmental Laws; or (iv) subpoena, request
for information or other written notice or demand of any type issued by an
Official Body pursuant to any Environmental Laws.
Environmental Laws shall mean all federal, state, local and foreign
Laws (including, but not limited to, the Comprehensive Environmental Response,
Compensation and Liability Act, 42 U.S.C. Sections 9601 et seq., the Resource
Conservation and Recovery Act, 42 U.S.C. Section 6901 et seq., the Hazardous
Materials Transportation Act, 49 U.S.C. Section 1801 et seq., the Toxic
Substances Control Act, 15 U.S.C. Section 2601 et seq., the Federal Water
Pollution Control Act, 33 U.S.C. Sections 1251 et seq., the Federal Safe
Drinking Water Act, 42 U.S.C. Sections 300f-300j, the Federal Air Pollution
Control Act, 42 U.S.C. Section 7401 et seq., the Oil Pollution Act, 33 U.S.C.
Section 2701 et seq., the Federal Insecticide, Fungicide and Rodenticide Act, 7
U.S.C. Sections 136 to 136y, the Occupational Safety and Health Act, 29 U.S.C.
Section 651 et seq., each as amended, and any regulations promulgated or any
equivalent state or local Law, and any amendments thereto) and any consent
decrees, consent orders, consent agreements, settlement agreements, judgments,
orders, directives, policies or programs issued by or entered into with an
Official Body pertaining or relating to: (i) pollution or pollution control;
(ii) protection of human health from exposure to Regulated Substances; (iii)
protection of the environment and/or natural resources; (iv) protection of
employee safety in the workplace and protection of employees from exposure to
Regulated Substances in the workplace (but excluding workers compensation and
wage and hour Laws); (v) the presence, use, management, generation, manufacture,
processing, extraction, treatment, recycling, refining, reclamation, labeling,
sale, transport, storage, collection, distribution, disposal or release or
threat of release of Regulated Substances; (vi) the presence of Contamination;
(vii) the protection of endangered or threatened species; and (viii) the
protection of Environmentally Sensitive Areas.
Environmental Permits shall mean all permits, licenses, bonds or
other forms of financial assurances, consents, registrations, identification
numbers, approvals or authorizations required under Environmental Laws (i) to
own, occupy or maintain the Property; (ii) for the operations and business
activities of any Loan Party; or (iii) for the performance of a Remedial Action.
Environmental Records shall mean all notices, reports, records,
plans, applications, forms or other filings relating or pertaining to the
Property, Contamination, the performance of a Remedial Action and the operations
and business activities of any Loan Party which pursuant to Environmental Laws,
Environmental Permits or at the request or direction of an Official Body either
must be submitted to an Official Body or which otherwise must be maintained.
6
Environmentally Sensitive Area shall mean (i) any wetland as defined
by applicable Environmental Laws; (ii) any area designated as a coastal zone
pursuant to applicable Laws, including Environmental Laws; (iii) any area of
historic or archeological significance or scenic area as defined or designated
by applicable Laws, including Environmental Laws; (iv) habitats of endangered
species or threatened species as designated by applicable Laws, including
Environmental Laws; or (v) a floodplain or other flood hazard area as defined
pursuant to any applicable Laws.
ERISA shall mean the Employee Retirement Income Security Act of
1974, as the same may be amended or supplemented from time to time, and any
successor statute of similar import, and the rules and regulations thereunder,
as from time to time in effect.
ERISA Group shall mean, at any time, the Borrower and all members of
a controlled group of corporations and all trades or businesses (whether or not
incorporated) under common control and all other entities which, together with
the Borrower, are treated as a single employer under Section 414 of the Internal
Revenue Code.
Euro-Rate shall mean, with respect to the Loans comprising any
Borrowing Tranche to which the Euro-Rate Option applies for any Interest Period,
the interest rate per annum determined by the Agent by dividing (the resulting
quotient rounded upwards, if necessary to the nearest 1/100th of 1% per annum)
(i) the rate of interest determined by the Agent in accordance with its usual
procedures (which determination shall be conclusive, absent manifest error) to
be the average of the London interbank offered rates for U.S. Dollars quoted by
the British Bankers' Association as set forth on Moneyline Telerate (or
appropriate successor or, if the British Bankers' Association or its successor
ceases to provide such quotes, a comparable replacement determined by the Agent)
display page 3750 (or such other display page on the Moneyline Telerate service
as may replace display page 3750), two (2) Business Days prior to the first day
of such Interest Period for an amount comparable to such Borrowing Tranche and
having a Borrowing Date and a maturity comparable to such Interest Period by
(ii) a number equal to 1.00 minus the Euro-Rate Reserve Percentage. The
Euro-Rate may also be expressed by the following formula:
Average of London interbank offered rates quoted
by BBA or appropriate successor as shown on
Euro-Rate = Moneyline Telerate Service display page 3750
--------------------------------------------
1.00 - Euro-Rate Reserve Percentage
The Euro-Rate shall be adjusted with respect to any Loan to which the Euro-Rate
Option applies that is outstanding on the effective date of any change in the
Euro-Rate Reserve Percentage as of such effective date. The Agent shall give
prompt notice to the Borrower of the Euro-Rate as determined or adjusted in
accordance herewith, which determination shall be conclusive absent manifest
error.
Euro-Rate Option shall mean the option of the Borrower to have
Revolving Credit Loans bear interest at the rate and under the terms and
conditions set forth in Section 4.1.1(ii).
7
Euro-Rate Reserve Percentage shall mean as of any day the maximum
percentage in effect on such day as prescribed by the Board of Governors of the
Federal Reserve System (or any successor) for determining the reserve
requirements (including supplemental, marginal and emergency reserve
requirements) with respect to eurocurrency funding (currently referred to as
"Eurocurrency Liabilities").
Event of Default shall mean any of the events described in Section
9.1 and referred to therein as an "Event of Default."
Executive Order No. 13224 shall mean the Executive Order No. 13224
on Terrorist Financing, effective September 24, 2001, as the same has been, or
shall hereafter be, renewed, extended, amended or replaced.
Existing Credit Facility shall mean that certain Amended and
Restated Credit Agreement among the Borrower, the guarantors party thereto, the
banks party thereto, Fleet National Bank and SunTrust Bank, each in its capacity
as a syndication agent, Bank of Tokyo-Mitsubishi Trust Company and JPMorgan
Chase Bank NA, previously known as JPMorgan Chase Bank, each in its capacity as
a documentation agent, Bank One, NA, Citizens Bank of Massachusetts and The Bank
of New York, each in its capacity as a co-agent, and PNC Bank, National
Association, in its capacity as administrative agent for the Banks, dated
December 19, 2003 (as amended by that certain First Amendment, dated March 24,
2004 and that certain Second Amendment, dated July 12, 2004).
Existing Letters of Credit shall have the meaning given to such term
in Section 2.9.1.
Expiration Date shall mean December 16, 2007.
Facility Fees collectively and Facility Fee separately shall have
the meaning given to such terms in Section 2.3.
Federal Funds Open Rate for any day shall mean the rate per annum
(based on a year of 360 days and actual days elapsed) determined by the Agent in
accordance with its usual procedures (which determination shall be conclusive
absent manifest error) to be the "Open" rate for federal funds transactions as
of the opening of business for federal funds transactions among members of the
Federal Reserve System arranged by federal funds brokers on such day, as quoted
by Garvin Guybutler, any successor entity thereto, or any other broker selected
by the Agent, as set forth on the applicable Telerate display page; provided,
however, that if such day is not a Business Day, the Federal Funds Open Rate for
such day shall be the "Open" rate on the immediately preceding Business Day, or
if no such rate shall be quoted by a federal funds broker at such time, such
other rate as determined by the Agent in accordance with its usual procedures.
GAAP shall mean generally accepted accounting principles as are in
effect in the United States from time to time, subject to the provisions of
Section 1.3, and applied on a consistent basis both as to classification of
items and amounts.
8
Governmental Acts shall have the meaning assigned to that term in
Section 2.9.8.
Guarantor shall mean each of the parties to this Agreement which is
designated as a "Guarantor" on the signature page hereof and each other Person
which joins this Agreement as a Guarantor after the date hereof pursuant to
Section 11.19.
Guarantor Joinder shall mean a joinder by a Person as a Guarantor
under this Agreement, the Guaranty Agreement and the other Loan Documents in the
form of Exhibit 1.1(G)(1).
Guaranty of any Person shall mean any obligation of such Person
guaranteeing or in effect guaranteeing any liability or obligation of any other
Person in any manner, whether directly or indirectly, including any agreement to
indemnify or hold harmless any other Person, any performance bond or other
suretyship arrangement and any other form of assurance against loss, except
endorsement of negotiable or other instruments for deposit or collection in the
ordinary course of business.
Guaranty Agreement shall mean the Guaranty and Suretyship Agreement
in substantially the form of Exhibit 1.1(G)(2) executed and delivered by each of
the Guarantors to the Agent for the benefit of the Banks.
Hedging Contract Policies shall mean the written internal policies
and procedures with respect to hedging or trading of gas contracts or other
commodity, hedging contracts of any kind, or any derivatives or other similar
financial instruments of the Borrower and its Subsidiaries, as in effect on the
date of this Agreement and as hereafter amended in accordance with Section
8.2.16, a copy of which has been delivered to the Agent and each Bank.
Hedging Transaction shall mean any transaction entered into by a
Loan Party or any of its Subsidiaries in accordance with the Hedging Contract
Policies.
Historical Statements shall have the meaning assigned to that term
in Section 6.1.8(i).
Hybrid Security shall mean any of the following: (i) beneficial
interests issued by a trust which constitutes a Subsidiary of any Loan Party,
substantially all of the assets of which trust are unsecured Indebtedness of any
Loan Party or any Subsidiary of any Loan Party or proceeds thereof, and all
payments of which Indebtedness are required to be, and are, distributed to the
holders of beneficial interests in such trust promptly after receipt by such
trust, or (ii) any shares of capital stock or other equity interest that, other
than solely at the option of the issuer thereof, by their terms (or by the terms
of any security into which they are convertible or exchangeable) are, or upon
the happening of an event or the passage of time would be, required to be
redeemed or repurchased, in whole or in part, or have, or upon the happening of
an event or the passage of time would have, a redemption or similar payment.
9
Inactive Subsidiary shall mean, at any time, any Subsidiary of any
Person, which Subsidiary (i) does not conduct any business or have operations,
and (ii) does not have total assets with a net book value, as of any date of
determination, in excess of $100,000.
Indebtedness shall mean, as to any Person at any time, any and all
indebtedness, obligations or liabilities (whether matured or unmatured,
liquidated or unliquidated, direct or indirect, absolute or contingent, or joint
or several) of such Person for or in respect of: (i) borrowed money, (ii)
amounts raised under or liabilities in respect of any note purchase or
acceptance credit facility, (iii) reimbursement obligations (contingent or
otherwise) under any letter of credit, currency swap agreement, interest rate
swap, cap, collar or floor agreement or other interest rate or currency exchange
rate management device, (iv) any other transaction (including forward sale or
purchase agreements, capitalized leases and conditional sales agreements) having
the commercial effect of a borrowing of money entered into by such Person to
finance its operations or capital requirements (but not including trade payables
and accrued expenses incurred in the ordinary course of business which are not
represented by a promissory note or other evidence of indebtedness and which are
not more than thirty (30) days past due), (v) any Hedging Transaction, to the
extent that any indebtedness, obligations or liabilities of such Person in
respect thereof constitutes "indebtedness" as determined in accordance with
GAAP, (vi) any Guaranty of any Hedging Transaction described in the immediately
preceding clause (v), (vii) any Guaranty of Indebtedness for borrowed money,
(viii) any Hybrid Security described in clause (i) of the definition of Hybrid
Security, or (ix) the mandatory repayment obligation of the issuer of any Hybrid
Security described in clause (ii) of the definition of Hybrid Security.
Ineligible Security shall mean any security which may not be
underwritten or dealt in by member banks of the Federal Reserve System under
Section 16 of the Banking Act of 1933 (12 U.S.C. Section 24, Seventh), as
amended.
Insolvency Proceeding shall mean, with respect to any Person, (a) a
case, action or proceeding with respect to such Person (i) before any court or
any other Official Body under any bankruptcy, insolvency, reorganization or
other similar Law now or hereafter in effect, or (ii) for the appointment of a
receiver, liquidator, assignee, custodian, trustee, sequestrator, conservator
(or similar official) of such Person or otherwise relating to the liquidation,
dissolution, winding-up or relief of such Person, or (b) any general assignment
for the benefit of creditors, composition, marshaling of assets for creditors,
or other, similar arrangement in respect of such Person's creditors generally or
any substantial portion of its creditors; undertaken under any Law.
Interest Period shall mean the period of time selected by the
Borrower in connection with (and to apply to) any election permitted hereunder
by the Borrower to have Revolving Credit Loans bear interest under the Euro-Rate
Option. Subject to the last sentence of this definition, such period shall be
one, two, three or six Months, and solely with approval of the Agent a shorter
period. Such Interest Period shall commence on the effective date of such
Interest Rate Option, which shall be (i) the Borrowing Date if the Borrower is
requesting new Loans, or (ii) the date of renewal of or conversion to the
Euro-Rate Option if the Borrower is renewing or converting to the Euro-Rate
Option applicable to outstanding Loans.
10
Notwithstanding the second sentence hereof: (A) any Interest Period which would
otherwise end on a date which is not a Business Day shall be extended to the
next succeeding Business Day unless such Business Day falls in the next calendar
month, in which case such Interest Period shall end on the next preceding
Business Day, and (B) the Borrower shall not select, convert to or renew an
Interest Period for any portion of the Loans that would end after the Expiration
Date.
IRH Provider shall have the meaning assigned to such term in Section
9.2.5.2 [Collateral Sharing].
Interest Rate Hedge shall mean an interest rate exchange, collar,
cap, swap, adjustable strike cap, adjustable strike corridor or similar
agreements entered into by the Loan Parties or their Subsidiaries in order to
provide protection to, or minimize the impact upon, the Borrower, any other Loan
Party and/or their Subsidiaries of increasing floating rates of interest
applicable to Indebtedness.
Interest Rate Option shall mean any Euro-Rate Option or Base Rate
Option.
Internal Revenue Code shall mean the Internal Revenue Code of 1986,
as the same may be amended or supplemented from time to time, and any successor
statute of similar import, and the rules and regulations thereunder, as from
time to time in effect.
Investment shall have the meaning assigned to that term in Section
8.2.4.
Labor Contracts shall mean all employment agreements, employment
contracts, collective bargaining agreements and other agreements among any Loan
Party or Subsidiary of a Loan Party and its employees.
Law shall mean any law (including common law), constitution,
statute, treaty, regulation, rule, ordinance, opinion, release, ruling, order,
injunction, writ, decree, bond, judgment, authorization or approval, lien or
award of or settlement agreement with any Official Body.
Letter of Credit shall have the meaning assigned to that term in
Section 2.9.1.
Letter of Credit Borrowing shall have the meaning assigned to such
term in Section 2.9.3.4.
Letter of Credit Fee shall have the meaning assigned to that term in
Section 2.9.2.
Letters of Credit Outstanding shall mean at any time the sum of (i)
the aggregate undrawn face amount of outstanding Letters of Credit and (ii) the
aggregate amount of all unpaid and outstanding Reimbursement Obligations and
Letter of Credit Borrowings.
11
Lien shall mean any mortgage, deed of trust, pledge, lien, security
interest, charge or other encumbrance or security arrangement of any nature
whatsoever, whether voluntarily or involuntarily given, including any
conditional sale or title retention arrangement, and any assignment, deposit
arrangement or lease intended as, or having the effect of, security and any
filed financing statement or other notice of any of the foregoing (whether or
not a lien or other encumbrance is created or exists at the time of the filing).
LLC Interests shall have the meaning given to such term in Section
6.1.2.
Loan Documents shall mean this Agreement, the Agent's Letter, the
Guaranty Agreement, the Notes (if any) and any other instruments, certificates
or documents delivered or contemplated to be delivered hereunder or thereunder
or in connection herewith or therewith, as the same may be supplemented or
amended from time to time in accordance herewith or therewith, and Loan Document
shall mean any of the Loan Documents.
Loan Parties shall mean the Borrower and the Guarantors.
Loan Request shall mean a request for a Revolving Credit Loan or a
request to select, convert to or renew a Base Rate Option or Euro-Rate Option
with respect to an outstanding Revolving Credit Loan in accordance with Sections
2.4, 2.5, 4.1 and 4.2.
Loans shall mean collectively and Loan shall mean separately all
Revolving Credit Loans and Swing Loans or any Revolving Credit Loan or Swing
Loan.
Material Adverse Change shall mean any set of circumstances or
events which (a) has or could reasonably be expected to have any material
adverse effect whatsoever upon the validity or enforceability of this Agreement
or any other Loan Document, (b) is or could reasonably be expected to be
material and adverse to the business, properties, assets, financial condition,
results of operations or prospects of the Loan Parties taken as a whole, (c)
impairs materially or could reasonably be expected to impair materially the
ability of the Loan Parties taken as a whole to duly and punctually pay the
Indebtedness or otherwise perform the obligations in accordance with the Loan
Documents, or (d) impairs materially or could reasonably be expected to impair
materially the ability of the Agent or any of the Banks, to the extent
permitted, to enforce their legal remedies pursuant to this Agreement or any
other Loan Document.
Month, with respect to an Interest Period under the Euro-Rate
Option, shall mean the interval between the days in consecutive calendar months
numerically corresponding to the first day of such Interest Period. If any
Euro-Rate Interest Period begins on a day of a calendar month for which there is
no numerically corresponding day in the month in which such Interest Period is
to end, the final month of such Interest Period shall be deemed to end on the
last Business Day of such final month.
Moody's shall mean Moody's Investors Service, Inc. and its
successors.
Mortgage Indenture shall mean that certain Indenture of Mortgage and
Deed of Trust dated April 1, 1952 from New Jersey Natural Gas Company to BNY
Midwest
12
Trust Company, as successor to Harris Trust and Savings Bank, Trustee, as
heretofore and hereafter amended, modified and supplemented.
Multiemployer Plan shall mean any employee benefit plan which is a
"multiemployer plan" within the meaning of Section 4001(a)(3) of ERISA and to
which the Borrower or any member of the ERISA Group is then making or accruing
an obligation to make contributions or, within the preceding five Plan years,
has made or had an obligation to make such contributions.
Multiple Employer Plan shall mean a Plan which has two or more
contributing sponsors (including the Borrower or any member of the ERISA Group)
at least two of whom are not under common control, as such a plan is described
in Sections 4063 and 4064 of ERISA.
Net Cash Proceeds shall mean, with respect to any issuance of debt
or a Hybrid Security, an amount equal to the cash proceeds received by the
Borrower or any of its Subsidiaries from or in respect of such transaction
(including, when received: (i) any cash proceeds received as income or other
deferred cash proceeds, or (ii) cash proceeds of any non-cash proceeds of such
transaction), less all investment banking fees, discounts and commissions, legal
fees, consulting fees, accountants' fees, underwriting discounts and commissions
and other customary and reasonable fees and expenses actually incurred in
connection therewith.
New Jersey Natural Gas shall mean New Jersey Natural Gas Company, a
corporation organized and existing under the laws of the State of New Jersey,
which corporation is a Subsidiary of the Borrower.
NJNG Credit Agreement shall mean that certain Credit Agreement,
dated as of December 16, 2004, among New Jersey Natural Gas, as the borrower,
JPMorgan Chase Bank NA and Fleet National Bank, each as syndication agent, Bank
of Tokyo-Mitsubishi Trust Company and Citicorp North America, Inc., each as
documentation agent, PNC Bank, National Association, as the administrative
agent, and the Banks party thereto, as the same may be restated, amended,
modified or supplemented from time to time.
NJNG Note Agreement shall mean the Note Agreement, dated March 15,
2004, as the same may be supplemented, amended, or modified from time to time as
permitted by Section 8.2.18 [Amendments to NJR Note Agreement and NJNG Note
Agreement] hereof.
NJNG Notes shall mean the unsecured Indebtedness issued by New
Jersey Natural Gas Company pursuant to the NJNG Note Agreement.
NJR Note Agreement shall mean the Note Agreement, dated March 15,
2004, as the same may be supplemented, amended, or modified from time to time as
permitted by Section 8.2.18 [Amendments to NJR Note Agreement and NJNG Note
Agreement] hereof.
NJR Notes shall mean the unsecured Indebtedness issued by the
Borrower pursuant to the NJR Note Agreement.
13
Notes shall mean the Revolving Credit Notes and Swing Loan Note, if
any.
Notices shall have the meaning assigned to that term in Section
11.6.
Obligations shall mean any obligation or liability of any of the
Loan Parties to the Agent or any of the Banks, howsoever created, arising or
evidenced, whether direct or indirect, absolute or contingent, now or hereafter
existing, or due or to become due, under or in connection with this Agreement,
any Notes, the Letters of Credit, the Agent's Letter or any other Loan Document.
Obligations shall include the liabilities to any Bank under any Bank-Provided
Interest Rate Hedge but shall not include the liabilities to other Persons under
any other Interest Rate Hedge.
Official Body shall mean any national, federal, state, local or
other government or political subdivision or any agency, authority, board,
bureau, central bank, commission, department or instrumentality of either, or
any court, tribunal, grand jury or arbitrator, in each case whether foreign or
domestic.
Participation Advance shall mean, with respect to any Bank, such
Bank's payment in respect of its participation in a Letter of Credit Borrowing
according to its Ratable Share pursuant to Section 2.9.3.4.
Partnership Interests shall have the meaning given to such term in
Section 6.1.2.
PBGC shall mean the Pension Benefit Guaranty Corporation established
pursuant to Subtitle A of Title IV of ERISA or any successor.
Permitted Acquisitions shall have the meaning assigned to such term
in Section 8.2.5 [Liquidations, Mergers, Consolidations, Acquisitions].
Permitted Investments shall mean:
(i) direct obligations of the United States of America or any
agency or instrumentality thereof or obligations backed by the full faith and
credit of the United States of America maturing in twelve (12) months or less
from the date of acquisition;
(ii) repurchase agreements having a duration of not more than
sixty (60) days that are collateralized by full faith and credit obligations of
the United States Government or obligations guaranteed by the United States
Government and its agencies;
(iii) interests in investment companies registered under the
Investment Company Act of 1940, as amended (or in a separate portfolio of such
an investment company), that invest primarily in full faith and credit
obligations of the United States Government or obligations guaranteed by the
United States Government and its agencies and repurchase agreements
collateralized by such obligations;
14
(iv) time deposits with any office located in the United States
of the Banks or any other bank or trust company which is organized under the
laws of the United States and has combined capital, surplus and undivided
profits of not less than $500,000,000 or with any bank which is organized other
than under the laws of the United States (y) the commercial paper of which is
rated at least A-1 by Standard & Poor's and P-1 by Moody's (or, if such
commercial paper is rated only by Standard & Poor's, at least A-1 by Standard &
Poor's, or if such commercial paper is rated only by Moody's, at least P-1 by
Moody's) or (z) the long term senior debt of which is rated at least AA by
Standard & Poor's and Aa2 by Moody's (or, if such debt is rated only by Standard
& Poor's, at least AA by Standard & Poor's, or if such debt is rated only by
Moody's, at least Aa2 by Moody's);
(v) commercial paper having a maturity of not more than one
year from the date of such investment and rated at least A-1 by Standard &
Poor's and P-1 by Moody's (or, if such commercial paper is rated only by
Standard & Poor's, at least A-1 by Standard & Poor's or, if such commercial
paper is rated only by Moody's, at least P-1 by Moody's);
(vi) instruments held for collection in the ordinary course of
business;
(vii) any equity or debt securities or other form of debt
instrument obtained in settlement of debts previously contracted;
(viii) any Investment arising out of a Permitted Related Business
Opportunity; and
(ix) any other form of Investment by the Borrower or any of its
Subsidiaries (other than New Jersey Natural Gas which is expressly prohibited
from making any Investments described in this clause (ix)) in any Person so long
as the consideration paid or exchanged by the Borrower, or any of its
Subsidiaries, for such investment (whether in cash or the value of
payment-in-kind, with the value of payment-in-kind as reasonably determined by
the Borrower) does not exceed $30,000,000 in the aggregate for all Investments
permitted by this clause (ix).
Permitted Liens shall mean:
(i) Liens for taxes, assessments, or similar charges, incurred
in the ordinary course of business and which are not yet due and payable;
(ii) Pledges or deposits made in the ordinary course of business
to secure payment of workmen's compensation, or to participate in any fund in
connection with workmen's compensation, unemployment insurance, old-age pensions
or other social security programs;
(iii)Liens of mechanics, materialmen, warehousemen, carriers, or
other like Liens, securing obligations incurred in the ordinary course of
business that are not yet due and payable and Liens of landlords securing
obligations to pay lease payments that are not yet due and payable or in
default;
15
(iv) Any Lien arising out of judgments or awards but only to the
extent that the creation of any such Lien shall not be an event or condition
which, with or without notice or lapse of time or both, would cause Borrower to
be in violation of Section 9.1.6;
(v) Security interests in favor of lessors of personal
property, which property is the subject of a true lease;
(vi) Good-faith pledges or deposits made in the ordinary course
of business to secure performance of bids, tenders, contracts (other than for
the repayment of borrowed money) or leases, not in excess of the aggregate
amount due thereunder, or to secure statutory obligations, or surety, appeal,
indemnity, performance or other similar bonds required in the ordinary course of
business;
(vii) Encumbrances consisting of zoning restrictions, easements,
rights-of-way or other restrictions on the use of real property and minor
defects to title to real property, none of which materially impairs the use of
such property or the value thereof;
(viii) Liens on property leased by any Loan Party or Subsidiary of
a Loan Party securing obligations of such Loan Party or Subsidiary to the lessor
under such leases, so long as to the extent the payments or other amounts due
and owing under any such lease constitute Indebtedness, such Indebtedness is
permitted under Section 8.2.1(vi);
(ix) Any Lien existing on the date of this Agreement and
described on Schedule 1.1(P), provided, that, to the extent any such Lien
secures Indebtedness permitted by Section 8.2.1(ii), such Lien may continue to
secure any renewals or extensions of such Indebtedness permitted by Section
8.2.1(ii) so long as (i) the principal amount of the Indebtedness secured by any
such Lien is not hereafter increased and (ii) no additional assets become
subject to such Lien;
(x) Liens on assets of New Jersey Natural Gas existing on the
Closing Date (other than on any "Excepted Property" of New Jersey Natural Gas,
as "Excepted Property" is defined in the Mortgage Indenture on the Closing
Date), which Liens secure outstanding Indebtedness as of the Closing Date under
the Mortgage Indenture and thereafter Liens on assets of New Jersey Natural Gas
(other than on any "Excepted Property") which additional Liens secure
outstanding Indebtedness as of the Closing Date under the Mortgage Indenture and
any additional Indebtedness which is issued in accordance with Article Two of
the Mortgage Indenture and is otherwise permitted by Section 8.2.1(iv);
(xi) Purchase Money Security Interests, provided, that the
aggregate amount of loans and deferred payments secured by such Purchase Money
Security Interests shall not exceed $20,000,000 (excluding for the purpose of
this computation any loans or deferred payments secured by Liens described on
Schedule 1.1(P));
(xii)Liens on any property or asset of an Acquired Person so
long as: (a) such Liens secure Indebtedness of the Acquired Person and such
Indebtedness and such Liens on property or assets of the Acquired Person existed
prior to the consummation of the Permitted
16
Acquisition and were not created in contemplation of or in connection with such
acquisition, (b) such Liens apply solely to the assets of the Acquired Person
and do not apply to any asset of any Loan Party, and (c) after giving effect to
such Permitted Acquisition and all other Permitted Acquisitions made by the Loan
Parties from and after the Closing Date, the aggregate outstanding amount of all
Indebtedness secured by Liens permitted by this clause (xii) shall not exceed
$75,000,000; and
(xiii) The following, (A) if the validity or amount thereof is being
contested in good faith by appropriate and lawful proceedings diligently
conducted so long as levy and execution thereon have been stayed and continue to
be stayed or (B) if a final judgment is entered and such judgment is discharged
within thirty (30) days of entry, and could not be reasonably expected to result
in a Material Adverse Change:
(1) Claims or Liens for taxes, assessments or charges due and
payable and subject to interest or penalty, provided that the applicable
Loan Party maintains such reserves or other appropriate provisions as
shall be required by GAAP and pays all such taxes, assessments or charges
forthwith upon the commencement of proceedings to foreclose any such Lien;
(2) Claims, Liens or encumbrances upon, and defects of title
to, real or personal property, including any attachment of personal or
real property or other legal process prior to adjudication of a dispute on
the merits; or
(3) Claims or Liens of mechanics, materialmen, warehousemen,
carriers, or other statutory nonconsensual Liens.
Notwithstanding the foregoing definition of Permitted Lien or any other
provision of the Loan Documents to the contrary, each of the Loan Parties shall
not, and shall not permit any of its Subsidiaries to, at any time create, incur,
assume or suffer to exist any Lien on any of the capital stock of New Jersey
Natural Gas, or agree or become liable to do so.
Permitted Related Business Opportunity shall mean any transaction
with another Person (other than any Inactive Subsidiary of the Borrower)
involving business activities or assets reasonably related or complementary to
the business of the Borrower and its Subsidiaries as conducted on the Closing
Date or as may be conducted pursuant to Section 8.2.9, including, without
limitation, the management and marketing of storage, capacity and transportation
of gas and other forms of energy, the generation, transmission or storage of gas
and other forms of energy, or the access to gas and energy transmission lines,
and business initiatives for the conservation and efficiency of gas and energy.
Permitted Transferee shall mean, as of any date of determination,
any of the following with respect to any then current officer or director of the
Borrower: (i) such Person's spouse, lineal descendants or lineal descendant's of
such Person's spouse, (ii) any charitable corporation or trust established by
such officer or director or by any Person described in the immediately preceding
clause (i), (iii) any trust (or in the case of a minor, a custodial account
under a Uniform Gifts or Transfers to Minors Act) of which the beneficiary or
17
beneficiaries are one or more Persons described in the immediately preceding
clauses (i) or (ii), or (iv) any executor or administrator upon the death of
such officer or director or the death of any Person described in the immediately
preceding clauses (i) or (ii).
Person shall mean any individual, corporation, partnership, limited
liability company, association, joint-stock company, trust, unincorporated
organization, joint venture, government or political subdivision or agency
thereof, or any other entity.
Plan shall mean at any time an employee pension benefit plan
(including a Multiple Employer Plan, but not a Multiemployer Plan) which is
covered by Title IV of ERISA or is subject to the minimum funding standards
under Section 412 of the Internal Revenue Code and either (i) is maintained by
any member of the ERISA Group for employees of any member of the ERISA Group or
(ii) has at any time within the preceding five years been maintained by any
entity which was at such time a member of the ERISA Group for employees of any
entity which was at such time a member of the ERISA Group.
PNC Bank shall mean PNC Bank, National Association, its successors
and assigns.
Potential Default shall mean any event or condition which with
notice, passage of time, or both, would constitute an Event of Default.
Principal Office shall mean the main banking office of the Agent in
Pittsburgh, Pennsylvania.
Prohibited Transaction shall mean any prohibited transaction as
defined in Section 4975 of the Internal Revenue Code or Section 406 of ERISA for
which neither an individual nor a class exemption has been issued by the United
States Department of Labor.
Property shall mean all real property, both owned and leased, of any
Loan Party or Subsidiary of a Loan Party.
Purchase Money Security Interest shall mean Liens upon tangible
personal property securing loans to any Loan Party or Subsidiary of a Loan Party
or deferred payments by such Loan Party or Subsidiary for the purchase of such
tangible personal property.
Purchasing Bank shall mean a Bank which becomes a party to this
Agreement by executing an Assignment and Assumption Agreement.
Ratable Share shall mean the proportion that a Bank's Commitment
(excluding its Swing Loan Commitment) bears to the Commitments (excluding the
Swing Loan Commitment) of all of the Banks.
Regulated Entity shall mean any Person which is subject under Law to
any of the laws, rules or regulations respecting the financial, organizational
or rate regulation of electric companies, public utilities, or public utility
holding companies.
18
Regulated Substances shall mean, without limitation, any substance,
material or waste, regardless of its form or nature, defined under Environmental
Laws as a "hazardous substance," "pollutant," "pollution," "contaminant,"
"hazardous or toxic substance," "extremely hazardous substance," "toxic
chemical," "toxic substance," "toxic waste," "hazardous waste," "special
handling waste," "industrial waste," "residual waste," "solid waste," "municipal
waste," "mixed waste," "infectious waste," "chemotherapeutic waste," "medical
waste," or "regulated substance" or any other substance, material or waste,
regardless of its form or nature, which is regulated, controlled or governed by
Environmental Laws due to its radioactive, ignitable, corrosive, reactive,
explosive, toxic, carcinogenic or infectious properties or nature or any other
material, substance or waste, regardless of its form or nature, which otherwise
is regulated, controlled or governed by Environmental Laws, including without
limitation, petroleum and petroleum products (including crude oil and any
fractions thereof), natural gas, synthetic gas and any mixtures thereof,
asbestos, urea formaldehyde, polychlorinated biphenlys, mercury, radon and
radioactive materials.
Regulation U shall mean Regulation U, T, G, or X as promulgated by
the Board of Governors of the Federal Reserve System, as amended from time to
time.
Reimbursement Obligation shall have the meaning assigned to such
term in Section 2.9.3.2.
Remedial Action shall mean any investigation, identification,
characterization, delineation, cleanup, removal, remediation, containment,
control or abatement of or other response actions to Regulated Substances and
any closure or post-closure measures associated therewith.
Reportable Event shall mean a reportable event described in Section
4043 of ERISA and regulations thereunder with respect to a Plan or Multiemployer
Plan.
Required Banks shall mean
(A) if there are no Loans, Reimbursement Obligations or Letter of
Credit Borrowings outstanding, Required Banks shall mean Banks whose Commitments
(excluding the Swing Loan Commitments) aggregate at least 51% of the Commitments
of all of the Banks, or
(B) if there are Loans, Reimbursement Obligations, or Letter of
Credit Borrowings outstanding, Required Banks shall mean:
(i) prior to a termination of the Commitments hereunder
pursuant to Section 9.2.1 or 9.2.2, any Bank or group of Banks if the sum of the
Loans (excluding the Swing Loans), Reimbursement Obligations and Letter of
Credit Borrowings of such Banks then outstanding aggregates at least 51% of the
total principal amount of all of the Loans (excluding the Swing Loans),
Reimbursement Obligations and Letter of Credit Borrowings then outstanding.
19
(ii) after a termination of the Commitments hereunder pursuant
to Section 9.2.1 or 9.2.2, any Bank or group of Banks if the sum of the Loans,
Reimbursement Obligations and Letter of Credit Borrowings of such Banks then
outstanding aggregates at least 51% of the total principal amount of all of the
Loans, Reimbursement Obligations and Letter of Credit Borrowings then
outstanding.
Reimbursement Obligations and Letter of Credit Borrowings shall be deemed, for
purposes of this definition, to be in favor of the Agent and not a participating
Bank if such Bank has not made its Participation Advance in respect thereof and
shall be deemed to be in favor of such Bank to the extent of its Participation
Advance if it has made its Participation Advance in respect thereof.
Required Share shall have the meaning assigned to such term in
Section 5.10.
Revolving Credit Commitment shall mean, as to any Bank at any time,
the amount initially set forth opposite its name on Schedule 1.1(B) in the
column labeled "Amount of Commitment for Revolving Credit Loans," and thereafter
as determined by the Agent after giving effect to each applicable Bank Joinder
and Assignment and Assumption Agreement executed by such Bank and delivered to
the Agent, and Revolving Credit Commitments shall mean the aggregate Revolving
Credit Commitments of all of the Banks.
Revolving Credit Loans shall mean collectively and Revolving Credit
Loan shall mean separately all Revolving Credit Loans or any Revolving Credit
Loan made by the Banks or one of the Banks to the Borrower pursuant to Section
2.1.1 or 2.9.3.
Revolving Credit Note shall mean any Revolving Credit Note of the
Borrower in the form of Exhibit 1.1(R) issued by the Borrower at the request of
a Bank pursuant to Section 5.9 evidencing the Revolving Credit Loans to such
Bank, together with all amendments, extensions, renewals, replacements,
refinancings or refundings thereof in whole or in part.
Revolving Facility Usage shall mean at any time the sum of the
Revolving Credit Loans outstanding, the Swing Loans outstanding and the Letters
of Credit Outstanding.
SEC shall mean the Securities and Exchange Commission or any
governmental agencies substituted therefor.
SEC Filings shall mean the Borrower's Form 10-K, filed with the SEC
for the fiscal year ended September 30, 2004 and Forms 10-Q, the first filed
with the SEC for the fiscal quarter ended December 31, 2003, the second filed
with SEC for the fiscal quarter ended March 31, 2004 and the third filed with
the SEC for the fiscal quarter ended June 30, 2004.
Section 20 Subsidiary shall mean the Subsidiary of the bank holding
company controlling any Bank, which Subsidiary has been granted authority by the
Federal Reserve Board to underwrite and deal in certain Ineligible Securities.
20
Settlement Date shall mean the 7th day of each week (if such day is
a Business Day and if not, the next succeeding Business Day) and any other
Business Day on which the Agent elects to effect settlement pursuant to Section
5.10.
Significant Subsidiary shall mean, New Jersey Natural Gas, NJR
Energy Services Company, or any Subsidiary of the Borrower which at any time (i)
has gross revenues equal to or in excess of five percent (5%) of the gross
revenues of the Borrower and its Subsidiaries on a consolidated basis, or (ii)
has total assets equal to or in excess of five percent (5%) of the total assets
of the Borrower and its Subsidiaries on a consolidated basis, in either case, as
determined and consolidated in accordance with GAAP.
Solvent shall mean, with respect to any Person on a particular date,
that on such date (i) such Person is able to realize upon its assets and pay its
debts and other liabilities as they mature in the normal course of business, and
(ii) such Person has not incurred debts or liabilities beyond such Person's
ability to pay as such debts and liabilities mature. Standard & Poor's shall
mean Standard & Poor's Ratings Services, a division of The McGraw-Hill
Companies, Inc., and its successors.
Standby Letter of Credit shall mean a Letter of Credit issued to
support obligations of one or more of the Loan Parties, contingent or otherwise,
which finance the working capital and business needs of the Loan Parties
incurred in the ordinary course of business, but excluding any Letter of Credit
under which the stated amount of such Letter of Credit increases automatically
over time.
Subsidiary of any Person at any time shall mean (i) any corporation
or trust of which 50% or more (by number of shares or number of votes) of the
outstanding capital stock or shares of beneficial interest normally entitled to
vote for the election of one or more directors or trustees (regardless of any
contingency which does or may suspend or dilute the voting rights) is at such
time owned directly or indirectly by such Person or one or more of such Person's
Subsidiaries, (ii) any partnership of which such Person is a general partner or
of which 50% or more of the partnership interests is at the time directly or
indirectly owned by such Person or one or more of such Person's Subsidiaries,
(iii) any limited liability company of which such Person is a member or of which
50% or more of the limited liability company interests is at the time directly
or indirectly owned by such Person or one or more of such Person's Subsidiaries
or (iv) any corporation, trust, partnership, limited liability company or other
entity which is controlled or capable of being controlled by such Person or one
or more of such Person's Subsidiaries.
Subsidiary Shares shall have the meaning assigned to that term in
Section 6.1.2.
Swing Loan Commitment shall mean PNC Bank's commitment to make Swing
Loans to the Borrower pursuant to Section 2.1.2 hereof in an aggregate principal
amount up to $45,000,000.
21
Swing Loan Interest Rate shall mean as to each Swing Loan the rate
of interest quoted by PNC Bank applicable thereto and accepted by the Borrower
with respect to such Swing Loan.
Swing Loan Note shall mean the Swing Loan Note of the Borrower in
the form of Exhibit 1.1(S) evidencing the Swing Loans, together with all
amendments, extensions, renewals, replacements, refinancings or refundings
thereof in whole or in part.
Swing Loan Request shall mean a request for Swing Loans made in
accordance with Section 2.5 hereof.
Swing Loans shall mean collectively and Swing Loan shall mean
separately all Swing Loans or any Swing Loan made by PNC Bank to the Borrower
pursuant to Section 2.1.2 hereof.
Transferor Bank shall mean the selling Bank pursuant to an
Assignment and Assumption Agreement.
USA Patriot Act shall mean the Uniting and Strengthening America by
Providing Appropriate Tools Required to Intercept and Obstruct Terrorism Act of
2001, Public Law 107-56, as the same has been, or shall hereafter be, renewed,
extended, amended or replaced.
1.2 Construction.
Unless the context of this Agreement otherwise clearly requires, the
following rules of construction shall apply to this Agreement and each of the
other Loan Documents:
1.2.1. Number; Inclusion.
references to the plural include the singular, the plural, the
part and the whole; "or" has the inclusive meaning represented by the phrase
"and/or" and "including" has the meaning represented by the phrase "including
without limitation";
1.2.2. Determination.
references to "determination" of or by the Agent or the Banks
shall be deemed to include good-faith estimates by the Agent or the Banks (in
the case of quantitative determinations) and good-faith beliefs by the Agent or
the Banks (in the case of qualitative determinations) and such determination
shall be conclusive absent manifest error;
1.2.3. Agent's Discretion and Consent.
whenever the Agent or the Banks are granted the right herein
to act in its or their sole discretion or to grant or withhold consent such
right shall be exercised in good faith;
22
1.2.4. Documents Taken as a Whole.
the words "hereof," "herein," "hereunder," "hereto," and
similar terms in this Agreement or any other Loan Document refer to this
Agreement or such other Loan Document as a whole and not to any particular
provision of this Agreement or such other Loan Document;
1.2.5. Headings.
the section and other headings contained in this Agreement or
such other Loan Document and the Table of Contents (if any), preceding this
Agreement or such other Loan Document are for reference purposes only and shall
not control or affect the construction of this Agreement or such other Loan
Document or the interpretation thereof in any respect;
1.2.6. Implied References to this Agreement.
article, section, subsection, clause, schedule and exhibit
references are to this Agreement or other Loan Document, as the case may be,
unless otherwise specified;
1.2.7. Persons.
reference to any Person includes such Person's successors and
assigns but, if applicable, only if such successors and assigns are permitted by
this Agreement or such other Loan Document, as the case may be, and reference to
a Person in a particular capacity excludes such Person in any other capacity;
1.2.8. Modifications to Documents.
reference to any agreement (including this Agreement and any
other Loan Document together with the schedules and exhibits hereto or thereto),
document or instrument means such agreement, document or instrument as amended,
modified, replaced, substituted for, superseded or restated;
1.2.9. From, To and Through.
relative to the determination of any period of time, "from"
means "from and including," "to" means "to but excluding," and "through" means
"through and including"; and
1.2.10. Shall; Will.
references to "shall" and "will" are intended to have the same
meaning.
1.3 Accounting Principles.
Except as otherwise provided in this Agreement, all computations and
determinations as to accounting or financial matters and all financial
statements to be delivered
23
pursuant to this Agreement shall be made and prepared in accordance with GAAP
(including principles of consolidation where appropriate), and all accounting or
financial terms shall have the meanings ascribed to such terms by GAAP;
provided, however, that all accounting terms used in Section 8.2 [Negative
Covenants] (and all defined terms used in the definition of any accounting term
used in Section 8.2) shall have the meaning given to such terms (and defined
terms) under GAAP as in effect on the date hereof applied on a basis consistent
with those used in preparing the Annual Statements referred to in Section
6.1.8(i) [Historical Statements]. In the event of any change after the date
hereof in GAAP, and if such change would result in the inability to determine
compliance with the financial covenants set forth in Section 8.2 based upon the
Borrower's regularly prepared financial statements by reason of the preceding
sentence, then the parties hereto agree to endeavor, in good faith, to agree
upon an amendment to this Agreement that would adjust such financial covenants
in a manner that would not affect the substance thereof, but would allow
compliance therewith to be determined in accordance with the Borrower's
financial statements at that time.
2. REVOLVING CREDIT AND SWING LOAN FACILITIES
2.1 Commitments.
2.1.1. Revolving Credit Loans.
Subject to the terms and conditions hereof and relying upon
the representations and warranties herein set forth, each Bank severally agrees
to make Revolving Credit Loans to the Borrower at any time or from time to time
on or after the date hereof to the Expiration Date, provided that, after giving
effect to each such Revolving Credit Loan the aggregate amount of Revolving
Credit Loans from such Bank shall not exceed such Bank's Revolving Credit
Commitment minus such Bank's Ratable Share of the amount of Letters of Credit
Outstanding; and provided further that the Revolving Facility Usage at any time
shall not exceed the Revolving Credit Commitments of all the Banks. Within such
limits of time and amount and subject to the other provisions of this Agreement,
the Borrower may borrow, repay and reborrow pursuant to this Section 2.1.1. The
outstanding principal amount of all Revolving Credit Loans, together with
accrued interest thereon, shall be due and payable on the Expiration Date.
2.1.2. Swing Loan Commitment.
Subject to the terms and conditions hereof and relying upon
the representations and warranties herein set forth, PNC Bank agrees to make
Swing Loans to the Borrower at any time or from time to time after the date
hereof to, but not including, the Expiration Date, in an aggregate principal
amount of up to but not in excess of the Swing Loan Commitment, provided that
the Revolving Facility Usage at any time shall not exceed the Revolving Credit
Commitments of all the Banks. Within such limits of time and amount and subject
to the other provisions of this Agreement, the Borrower may borrow, repay and
reborrow pursuant to this Section 2.1.2. The outstanding principal amount of all
Swing Loans, together
24
with accrued interest thereon, shall be due and payable on the earlier of the
Settlement Date applicable thereto or the Expiration Date.
2.2 Nature of Banks' Obligations with Respect to Revolving Credit Loans.
Each Bank shall be obligated to participate in each request for Revolving
Credit Loans pursuant to Section 2.4 [Revolving Credit Loan Requests] in
accordance with its Ratable Share. The aggregate amount of each Bank's Revolving
Credit Loans outstanding hereunder to the Borrower at any time shall never
exceed its Revolving Credit Commitment minus its Ratable Share of the amount of
Letters of Credit Outstanding. The obligations of each Bank hereunder are
several. The failure of any Bank to perform its obligations hereunder shall not
affect the Obligations of the Borrower to any other party nor shall any other
party be liable for the failure of such Bank to perform its obligations
hereunder. The Banks shall have no obligation to make Revolving Credit Loans
hereunder on or after the Expiration Date.
2.3 Facility Fees.
Accruing from the date hereof until the Expiration Date, the Borrower
agrees to pay to the Agent for the account of each Bank, as consideration for
such Bank's Revolving Credit Commitment hereunder, a nonrefundable facility fee
(the "Facility Fee") equal to the Applicable Facility Fee Rate (computed on the
basis of a year of 360 days and actual days elapsed) on the average daily amount
of such Bank's Revolving Credit Commitment as the same may be constituted from
time to time. All Facility Fees shall be payable quarterly in arrears on the
first day of each January, April, July and October after the date hereof and on
the Expiration Date or upon acceleration of the Loans.
2.4 Revolving Credit Loan Requests.
Except as otherwise provided herein, the Borrower may from time to time
prior to the Expiration Date request the Banks to make Revolving Credit Loans or
renew or convert the Interest Rate Option applicable to existing Revolving
Credit Loans pursuant to Section 4.2 [Interest Periods], by delivering to the
Agent, not later than 10:00 a.m., Pittsburgh time, (i) three (3) Business Days
prior to the proposed Borrowing Date with respect to the making of Revolving
Credit Loans to which the Euro-Rate Option applies or the date of conversion to
or the renewal of the Euro-Rate Option for any such Loans; and (ii) one (1)
Business Day prior to either the proposed Borrowing Date with respect to the
making of a Revolving Credit Loan to which the Base Rate Option applies or the
last day of the preceding Interest Period with respect to the conversion to the
Base Rate Option for any Loan, of a duly completed Loan Request therefor
substantially in the form of Exhibit 2.4 or a Loan Request by telephone
immediately confirmed in writing by letter, facsimile or telex in the form of
such Exhibit, it being understood that the Agent may rely on the authority of
any individual making such a telephonic request without the necessity of receipt
of such written confirmation. Each Loan Request shall be irrevocable and shall
specify (i) the proposed Borrowing Date; (ii) the aggregate amount of the
proposed Revolving Credit Loans comprising each Borrowing Tranche, the amount of
which shall be in integral multiples of $1,000,000 and not less than $3,000,000
for each Borrowing Tranche to which the Euro-Rate Option applies and not less
than the lesser of $1,000,000 and in integral
25
multiples of $100,000 or the maximum amount available for Borrowing Tranches to
which the Base Rate Option applies; (iii) whether the Euro-Rate Option or Base
Rate Option shall apply to the proposed Loans comprising the applicable
Borrowing Tranche; and (iv) in the case of a Borrowing Tranche to which the
Euro-Rate Option applies, an appropriate Interest Period for the Loans
comprising such Borrowing Tranche.
2.5 Swing Loan Requests.
Except as otherwise provided herein, the Borrower may from time to time
prior to the Expiration Date request PNC Bank to make a Swing Loan by delivery
to PNC Bank, not later than 12:00 noon Pittsburgh time, on the proposed
Borrowing Date of a duly completed request therefor substantially in the form of
Exhibit 2.5 hereto or a request by telephone immediately confirmed in writing by
letter, facsimile or telex, it being understood that PNC Bank may rely on the
authority of any individual making such a telephonic request without the
necessity of receipt of such written confirmation. Each Swing Loan Request shall
be irrevocable and shall specify (i) the proposed Borrowing Date, (ii) the term
of the proposed Swing Loan, which shall be no less than one day and no longer
than seven (7) days, and (iii) the principal amount of such Swing Loan, which
shall not be less than $250,000 and shall be an integral multiple of $100,000.
2.6 Making Revolving Credit Loans and Swing Loans.
2.6.1. Making Revolving Credit Loans.
The Agent shall, promptly after receipt by it of a Loan
Request for or with respect to Revolving Credit Loans pursuant to Section 2.4
[Revolving Credit Loan Requests], notify the Banks with Revolving Credit
Commitments of its receipt of such Loan Request specifying: (i) the proposed
Borrowing Date and the time and method of disbursement of the Revolving Credit
Loans requested thereby; (ii) the amount and type of each such Revolving Credit
Loan and the applicable Interest Period (if any); and (iii) the apportionment
among the Banks of such Revolving Credit Loans as determined by the Agent in
accordance with Section 2.2 [Nature of Banks' Obligations]. Each Bank shall
remit the principal amount of each Revolving Credit Loan to the Agent such that
the Agent is able to, and the Agent shall, to the extent the Banks have made
funds available to it for such purpose and subject to Section 7.2 [Each
Additional Loan or Letter of Credit], fund such Revolving Credit Loans to the
Borrower in U.S. Dollars and immediately available funds at the Principal Office
prior to 2:00 p.m., Pittsburgh time, on the applicable Borrowing Date, provided
that if any Bank fails to remit such funds to the Agent in a timely manner, the
Agent may elect in its sole discretion to fund with its own funds the Revolving
Credit Loans of such Bank on such Borrowing Date, and such Bank shall be subject
to the repayment obligation in Section 10.16 [Availability of Funds].
2.6.2. Making Swing Loans.
So long as PNC Bank elects to make Swing Loans, PNC Bank
shall, after receipt by it of a Swing Loan Request pursuant to Section 2.5 fund
such Swing Loan to the Borrower in U.S. Dollars and immediately available funds
at the Principal Office prior to
26
2:00 p.m. Pittsburgh time on the Borrowing Date. Each Swing Loan shall bear
interest at the Swing Loan Interest Rate applicable thereto.
2.7 Swing Loan Note.
The obligation of the Borrower to repay the unpaid principal amount of the
Swing Loans made to it by PNC Bank together with interest thereon shall be
evidenced by a demand promissory note of the Borrower dated the Closing Date in
substantially the form attached hereto as Exhibit 1.1(S) payable to the order of
PNC Bank in a face amount equal to the Swing Loan Commitment.
2.8 Use of Proceeds.
The proceeds of the Loans shall be used by the Borrower for
general corporate purposes of the Borrower and in accordance with Section 8.1.10
[Use of Proceeds].
2.9 Letter of Credit Subfacility.
2.9.1. Issuance of Letters of Credit.
Borrower may request the issuance of a letter of credit (each
a "Letter of Credit") on behalf of itself by delivering to the Agent a completed
application and agreement for letters of credit in such form as the Agent may
specify from time to time by no later than 10:00 a.m., Pittsburgh time, at least
five (5) Business Days, or such shorter period as may be agreed to by the Agent,
in advance of the proposed date of issuance. Each Letter of Credit shall be a
Standby Letter of Credit (and may not be a Commercial Letter of Credit). Subject
to the terms and conditions hereof and in reliance on the agreements of the
other Banks set forth in this Section 2.9, the Agent or any of the Agent's
Affiliates will issue a Letter of Credit provided that each Letter of Credit
shall (A) have a maximum maturity of twelve (12) months from the date of
issuance, and (B) in no event expire later than ten (10) Business Days prior to
the Expiration Date and providing that in no event shall (i) the amount of
Letters of Credit Outstanding exceed, at any one time, $75,000,000 or (ii) the
Revolving Facility Usage exceed, at any one time, the Revolving Credit
Commitments. Schedule 2.9.1 sets forth letters of credit, issued by PNC Bank,
National Association, as administrative agent, under the Existing Credit
Facility, which are outstanding as of the Closing Date (the "Existing Letters of
Credit"). It is expressly agreed that the Existing Letters of Credit are Letters
of Credit under this Agreement.
2.9.2. Letter of Credit Fees.
The Borrower shall pay (i) to the Agent for the ratable
account of the Banks a fee (the "Letter of Credit Fee") equal to the Applicable
Letter of Credit Fee Rate then in effect (computed on the basis of a year of 360
days and actual days elapsed) per annum, and (ii) to the Agent for its own
account a fronting fee equal to 0.125% per annum (computed on the basis of a
year of 360 days and actual days elapsed), which fees shall be computed on the
daily average amount of Letters of Credit Outstanding and shall be payable
quarterly in arrears commencing with the first Business Day of each January,
April, July and October following issuance of each Letter of Credit and on the
Expiration Date. The Borrower shall also pay to the
27
Agent for the Agent's sole account the Agent's then in effect customary fees and
administrative expenses payable with respect to the Letters of Credit as the
Agent may generally charge or incur from time to time in connection with the
issuance, maintenance, modification (if any), assignment or transfer (if any),
negotiation, and administration of Letters of Credit.
2.9.3. Disbursements, Reimbursement.
2.9.3.1 Immediately upon the issuance of each Letter of
Credit, each Bank shall be deemed to, and hereby irrevocably and unconditionally
agrees to, purchase from the Agent a participation in such Letter of Credit and
each drawing thereunder in an amount equal to such Bank's Ratable Share of the
maximum amount available to be drawn under such Letter of Credit and the amount
of such drawing, respectively.
2.9.3.2 In the event of any request for a drawing under a
Letter of Credit by the beneficiary or transferee thereof, the Agent will
promptly notify the Borrower. Provided that it shall have received such notice,
the Borrower shall reimburse (such obligation to reimburse the Agent shall
sometimes be referred to as a "Reimbursement Obligation") the Agent prior to
12:00 noon, Pittsburgh time on each date that an amount is paid by the Agent
under any Letter of Credit (each such date, an "Drawing Date") in an amount
equal to the amount so paid by the Agent. In the event the Borrower fails to
reimburse the Agent for the full amount of any drawing under any Letter of
Credit by 12:00 noon, Pittsburgh time, on the Drawing Date, the Agent will
promptly notify each Bank thereof, and the Borrower shall be deemed to have
requested that Revolving Credit Loans be made by the Banks under the Base Rate
Option to be disbursed on the Drawing Date under such Letter of Credit, subject
to the amount of the unutilized portion of the Revolving Credit Commitment and
subject to the conditions set forth in Section 7.2 [Each Additional Loan] other
than any notice requirements. Any notice given by the Agent pursuant to this
Section 2.9.3.2 may be oral if immediately confirmed in writing; provided that
the lack of such an immediate confirmation shall not affect the conclusiveness
or binding effect of such notice.
2.9.3.3 Each Bank shall upon any notice pursuant to Section
2.9.3.2 make available to the Agent an amount in immediately available funds
equal to its Ratable Share of the amount of the drawing, whereupon the
participating Banks shall (subject to Section 2.9.3.4) each be deemed to have
made a Revolving Credit Loan under the Base Rate Option to the Borrower in that
amount. If any Bank so notified fails to make available to the Agent for the
account of the Agent the amount of such Bank's Ratable Share of such amount by
no later than 2:00 p.m., Pittsburgh time on the Drawing Date, then interest
shall accrue on such Bank's obligation to make such payment, from the Drawing
Date to the date on which such Bank makes such payment (i) at a rate per annum
equal to the Federal Funds Open Rate during the first three (3) days following
the Drawing Date and (ii) at a rate per annum equal to the rate applicable to
Loans under the Base Rate Option on and after the fourth (4th) day following the
Drawing Date. The Agent will promptly give notice of the occurrence of the
Drawing Date, but failure of the Agent to give any such notice on the Drawing
Date or in sufficient time to enable any Bank to effect such payment on such
date shall not relieve such Bank from its obligation under this Section 2.9.3.3,
provided, however, interest shall not accrue on any Bank's obligation to make a
28
payment under this Section 2.9.3.3, until such Bank has received notice of the
Drawing Date from the Agent.
2.9.3.4 With respect to any unreimbursed drawing that is not
converted into Revolving Credit Loans under the Base Rate Option to the Borrower
in whole or in part as contemplated by Section 2.9.3.2, because of the
Borrower's failure to satisfy the conditions set forth in Section 7.2 [Each
Additional Loan] other than any notice requirements or for any other reason, the
Borrower shall be deemed to have incurred from the Agent a borrowing (each a
"Letter of Credit Borrowing") in the amount of such drawing. Such Letter of
Credit Borrowing shall be due and payable on demand (together with interest) and
shall bear interest at the rate per annum applicable to the Revolving Credit
Loans under the Base Rate Option. Each Bank's payment to the Agent pursuant to
Section 2.9.3.3 shall be deemed to be a payment in respect of its participation
in such Letter of Credit Borrowing and shall constitute a "Participation
Advance" from such Bank in satisfaction of its participation obligation under
this Section 2.9.3.
2.9.4. Repayment of Participation Advances.
2.9.4.1 Upon (and only upon) receipt by the Agent for its
account of immediately available funds from the Borrower (i) in reimbursement of
any payment made by the Agent under the Letter of Credit with respect to which
any Bank has made a Participation Advance to the Agent, or (ii) in payment of
interest on such a payment made by the Agent under such a Letter of Credit, the
Agent will pay to each Bank, in the same funds as those received by the Agent,
the amount of such Bank's Ratable Share of such funds, except the Agent shall
retain the amount of the Ratable Share of such funds of any Bank that did not
make a Participation Advance in respect of such payment by Agent.
2.9.4.2 If the Agent is required at any time to return to any
Loan Party, or to a trustee, receiver, liquidator, custodian, or any official in
any Insolvency Proceeding, any portion of the payments made by any Loan Party to
the Agent pursuant to Section 2.9.4.1 in reimbursement of a payment made under
the Letter of Credit or interest or fee thereon, each Bank shall, on demand of
the Agent, forthwith return to the Agent the amount of its Ratable Share of any
amounts so returned by the Agent plus interest thereon from the date such demand
is made to the date such amounts are returned by such Bank to the Agent, at a
rate per annum equal to the Federal Funds Open Rate in effect from time to time.
2.9.5. Documentation.
Each Loan Party agrees to be bound by the terms of the Agent's
application and agreement for letters of credit and the Agent's written
regulations and customary practices relating to letters of credit, though such
interpretation may be different from such Loan Party's own. In the event of a
conflict between such application or agreement and this Agreement, this
Agreement shall govern. It is understood and agreed that, except in the case of
gross negligence or willful misconduct, the Agent shall not be liable for any
error and/or mistakes, whether of omission or commission, in following any Loan
Party's written instructions or those contained in the Letters of Credit or any
modifications, amendments or supplements
29
thereto, provided that each Loan Party agrees that all instructions provided to
the Agent by a Loan Party with respect to any Letter of Credit shall be provided
in writing.
2.9.6. Determinations to Honor Drawing Requests.
In determining whether to honor any request for drawing under
any Letter of Credit by the beneficiary thereof, the Agent shall be responsible
only to determine that the documents and certificates required to be delivered
under such Letter of Credit have been delivered and that they comply on their
face with the requirements of such Letter of Credit.
2.9.7. Nature of Participation and Reimbursement Obligations.
Each Bank's obligation in accordance with this Agreement to
make the Revolving Credit Loans or Participation Advances, as contemplated by
Section 2.9.3, as a result of a drawing under a Letter of Credit, and the
Obligations of the Borrower to reimburse the Agent upon a draw under a Letter of
Credit, shall be absolute, unconditional and irrevocable, and shall be performed
strictly in accordance with the terms of this Section 2.9 under all
circumstances, including the following circumstances:
(i) any set-off, counterclaim, recoupment, defense or other
right which such Bank may have against the Agent or any of its
Affiliates, the Borrower or any other Person for any reason
whatsoever;
(ii) the failure of any Loan Party or any other Person to
comply, in connection with a Letter of Credit Borrowing, with
the conditions applicable to Revolving Credit Loans set forth
in Section 2.1.1 [Revolving Credit Loans], 2.4 [Revolving
Credit Loan Requests], 2.6 [Making Revolving Credit Loans and
Swing Loans] or 7.2 [Each Additional Loan or Letter of Credit]
or as otherwise set forth in this Agreement for the making of
a Revolving Credit Loan, it being acknowledged that such
conditions are not required for the making of a Letter of
Credit Borrowing and the obligation of the Banks to make
Participation Advances under Section 2.9.3;
(iii) any lack of validity or enforceability of any Letter of
Credit;
(iv) any claim of breach of warranty that might be made by any
Loan Party or any Bank against any beneficiary of a Letter of
Credit, or the existence of any claim, set-off, recoupment,
counterclaim, crossclaim, defense or other right which any
Loan Party or any Bank may have at any time against a
beneficiary, successor beneficiary any transferee or assignee
of any Letter of Credit or the proceeds thereof (or any
Persons for whom any such transferee may be acting), the Agent
or its Affiliates or any Bank or
30
any other Person or, whether in connection with this
Agreement, the transactions contemplated herein or any
unrelated transaction (including any underlying transaction
between any Loan Party or Subsidiaries of a Loan Party and the
beneficiary for which any Letter of Credit was procured);
(v) the lack of power or authority of any signer of (or any
defect in or forgery of any signature or endorsement on) or
the form of or lack of validity, sufficiency, accuracy,
enforceability or genuineness of any draft, demand,
instrument, certificate or other document presented under or
in connection with any Letter of Credit, or any fraud or
alleged fraud in connection with any Letter of Credit, or the
transport of any property or provisions of services relating
to a Letter of Credit, in each case even if the Agent or any
of the Agent's Affiliates has been notified thereof;
(vi) payment by the Agent or any of its Affiliates under any
Letter of Credit against presentation of a demand, draft or
certificate or other document which does not comply with the
terms of such Letter of Credit;
(vii) the solvency of, or any acts of omissions by, any
beneficiary of any Letter of Credit, or any other Person
having a role in any transaction or obligation relating to a
Letter of Credit, or the existence, nature, quality, quantity,
condition, value or other characteristic of any property or
services relating to a Letter of Credit;
(viii) any failure by the Agent or any of Agent's Affiliates
to issue any Letter of Credit in the form requested by any
Loan Party, unless the Agent has received written notice from
such Loan Party of such failure within three Business Days
after the Agent shall have furnished such Loan Party a copy of
such Letter of Credit and such error is material and no
drawing has been made thereon prior to receipt of such notice;
(ix) any adverse change in the business, operations,
properties, assets, condition (financial or otherwise) or
prospects of any Loan Party or Subsidiaries of a Loan Party;
(x) any breach of this Agreement or any other Loan Document
by any party thereto;
(xi) the occurrence or continuance of an Insolvency
Proceeding with respect to any Loan Party;
31
(xii) the fact that an Event of Default or a Potential Default
shall have occurred and be continuing;
(xiii) the fact that the Expiration Date shall have passed or
this Agreement or the Commitments hereunder shall have been
terminated; and
(xiv) any other circumstance or happening whatsoever, whether
or not similar to any of the foregoing.
Notwithstanding the foregoing, no Bank shall be required to make a Revolving
Credit Advance or a Participation Advance in excess of its Revolving Credit
Commitment minus its Ratable Share of any Letters of Credit Outstanding.
2.9.8. Indemnity.
In addition to amounts payable as provided in Section 10.5
[Reimbursement and Indemnification of Agent by the Borrower], the Borrower
hereby agrees to protect, indemnify, pay and save harmless the Agent and any of
Agent's Affiliates that has issued a Letter of Credit from and against any and
all claims, demands, liabilities, damages, taxes, penalties, interest,
judgments, losses, costs, charges and expenses (including reasonable fees,
expenses and disbursements of counsel and allocated costs of internal counsel)
which the Agent or any of Agent's Affiliates may incur or be subject to as a
consequence of the issuance of any Letter of Credit, other than as a result of
(A) the gross negligence or willful misconduct of the Agent as determined by a
final judgment of a court of competent jurisdiction or (B) the wrongful dishonor
by the Agent or any of Agent's Affiliates of a proper demand for payment made
under any Letter of Credit, except if such dishonor resulted from any act or
omission, whether rightful or wrongful, of any present or future de jure or de
facto government or governmental authority (all such acts or omissions herein
called "Governmental Acts").
2.9.9. Liability for Acts and Omissions.
As between any Loan Party and the Agent, or the Agent's
Affiliates, such Loan Party assumes all risks of the acts and omissions of, or
misuse of the Letters of Credit by, the respective beneficiaries of such Letters
of Credit. In furtherance and not in limitation of the foregoing, the Agent
shall not be responsible for any of the following including any losses or
damages to any Loan Party or other Person or property relating therefrom: (i)
the form, validity, sufficiency, accuracy, genuineness or legal effect of any
document submitted by any party in connection with the application for an
issuance of any such Letter of Credit, even if it should in fact prove to be in
any or all respects invalid, insufficient, inaccurate, fraudulent or forged
(even if the Agent or the Agent's Affiliates shall have been notified thereof);
(ii) the validity or sufficiency of any instrument transferring or assigning or
purporting to transfer or assign any such Letter of Credit or the rights or
benefits thereunder or proceeds thereof, in whole or in part, which may prove to
be invalid or ineffective for any reason; (iii) the failure of the beneficiary
of any such Letter of Credit, or any other party to which such Letter of Credit
may be transferred, to comply fully with any conditions required in order to
draw upon such Letter of
32
Credit or any other claim of any Loan Party against any beneficiary of such
Letter of Credit, or any such transferee, or any dispute between or among any
Loan Party and any beneficiary of any Letter of Credit or any such transferee;
(iv) errors, omissions, interruptions or delays in transmission or delivery of
any messages, by mail, cable, telegraph, telex or otherwise, whether or not they
be in cipher; (v) errors in interpretation of technical terms; (vi) any loss or
delay in the transmission or otherwise of any document required in order to make
a drawing under any such Letter of Credit or of the proceeds thereof; (vii) the
misapplication by the beneficiary of any such Letter of Credit of the proceeds
of any drawing under such Letter of Credit; or (viii) any consequences arising
from causes beyond the control of the Agent or the Agent's Affiliates, as
applicable, including any Governmental Acts, and none of the above shall affect
or impair, or prevent the vesting of, any of the Agent's or the Agent's
Affiliates rights or powers hereunder. Nothing in the preceding sentence shall
relieve the Agent from liability for the Agent's gross negligence or willful
misconduct in connection with actions or omissions described in such clauses (i)
through (viii) of such sentence. In no event shall the Agent or the Agent's
Affiliates be liable to any Loan Party for any indirect, consequential,
incidental, punitive, exemplary or special damages or expenses (including
without limitation attorneys' fees), or for any damages resulting from any
change in the value of any property relating to a Letter of Credit.
Without limiting the generality of the foregoing, the Agent
and each of its Affiliates (i) may rely on any oral or other communication
believed in good faith by the Agent or such Affiliate to have been authorized or
given by or on behalf of the applicant for a Letter of Credit, (ii) may honor
any presentation if the documents presented appear on their face substantially
to comply with the terms and conditions of the relevant Letter of Credit; (iii)
may honor a previously dishonored presentation under a Letter of Credit, whether
such dishonor was pursuant to a court order, to settle or compromise any claim
of wrongful dishonor, or otherwise, and shall be entitled to reimbursement to
the same extent as if such presentation had initially been honored, together
with any interest paid by the Agent or its Affiliate; (iv) may honor any drawing
that is payable upon presentation of a statement advising negotiation or
payment, upon receipt of such statement (even if such statement indicates that a
draft or other document is being delivered separately), and shall not be liable
for any failure of any such draft or other document to arrive, or to conform in
any way with the relevant Letter of Credit; (v) may pay any paying or
negotiating bank claiming that it rightfully honored under the laws or practices
of the place where such bank is located; and (vi) may settle or adjust any claim
or demand made on the Agent or its Affiliate in any way related to any order
issued at the applicant's request to an air carrier, a letter of guarantee or of
indemnity issued to a carrier or any similar document (each an "Order") and
honor any drawing in connection with any Letter of Credit that is the subject to
such Order, notwithstanding that any drafts or other documents presented in
connection with such Letter of Credit fail to conform in any way with such
Letter of Credit.
In furtherance and extension and not in limitation of the
specific provisions set forth above, any action taken or omitted by the Agent or
the Agent's Affiliates under or in connection with the Letters of Credit issued
by it or any documents and certificates delivered thereunder, if taken or
omitted in good faith, shall not put the Agent or the Agent's Affiliates under
any resulting liability to the Borrower or any Bank.
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2.10 Borrowings to Repay Swing Loans.
PNC Bank may, at its option, exercisable at any time for any reason
whatsoever, demand repayment of the Swing Loans, and each Bank shall make a
Revolving Credit Loan in an amount equal to such Bank's Ratable Share of the
aggregate principal amount of the outstanding Swing Loans, plus, if PNC Bank so
requests, accrued interest thereon, provided that no Bank shall be obligated in
any event to make Revolving Credit Loans in excess of its Revolving Credit
Commitment minus such Bank's Ratable Share of the amount of Letters of Credit
Outstanding. Revolving Credit Loans made pursuant to the preceding sentence
shall bear interest at the Base Rate Option and shall be deemed to have been
properly requested in accordance with Section 2.5 without regard to any of the
requirements of that provision. PNC Bank shall provide notice to the Banks
(which may be telephonic or written notice by letter, facsimile or telex) that
such Revolving Credit Loans are to be made under this Section 2.10 and of the
apportionment among the Banks, and the Banks shall be unconditionally obligated
to fund such Revolving Credit Loans (whether or not the conditions specified in
Section 2.4 or Section 7.2 are then satisfied) by the time PNC Bank so requests,
which shall not be earlier than 3:00 p.m. Pittsburgh time on the Business Day
next after the date the Banks receive such notice from PNC Bank.
2.11 Right to Increase Commitments.
Provided that there is no Event of Default or Potential Default, if the
Borrower wishes to increase the Revolving Credit Commitments, the Borrower shall
notify the Agent thereof, provided that any such increase shall be in a minimum
of $5,000,000 and the aggregate of all such increases in the Revolving Credit
Commitments shall not exceed $50,000,000 from and after the Closing Date. Each
Bank shall have the right at any time within fifteen (15) days following such
notice to increase its respective Revolving Credit Commitment so as to provide
such added commitment pro rata in accordance with such Bank's Ratable Share, and
any portion of such requested increase that is not provided by any Bank shall:
(i) first be available to the other Banks pro rata in accordance with their
Ratable Share, (ii) next be available to the other Banks in such a manner as the
Borrower, the Agent and those Banks shall agree, and (iii) thereafter, to the
extent not provided by the Banks, to any additional bank proposed by the
Borrower, which is approved by the Agent (which approval shall not be
unreasonably withheld) and that becomes a party to this Agreement pursuant to
Section 11.11 [Successors and Assigns; Joinder of a Bank]. In the event of any
such increase in the aggregate Revolving Credit Commitments effected pursuant to
the terms of this Section 2.11, new Notes shall, to the extent necessary, be
executed and delivered by the Borrower in exchange for the surrender of the
existing Notes.
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3. INTENTIONALLY OMITTED
4. INTEREST RATES
4.1 Interest Rate Options.
The Borrower shall pay interest in respect of the outstanding unpaid
principal amount of the Loans as selected by it from the Base Rate Option or
Euro-Rate Option set forth below applicable to the Loans, it being understood
that, subject to the provisions of this Agreement, the Borrower may select
different Interest Rate Options and different Interest Periods to apply
simultaneously to the Loans comprising different Borrowing Tranches and may
convert to or renew one or more Interest Rate Options with respect to all or any
portion of the comprising any Borrowing Tranche, provided that there shall not
be at any one time outstanding more than ten (10) Borrowing Tranches in the
aggregate among all of the Loans, and provided further that only the Swing Loan
Interest Rate shall apply to the Swing Loans. If at any time the designated rate
applicable to any Loan made by any Bank exceeds such Bank's highest lawful rate,
the rate of interest on such Bank's Loan shall be limited to such Bank's highest
lawful rate.
4.1.1. Revolving Credit Interest Rate Options.
The Borrower shall have the right to select from the following
Interest Rate Options applicable to the Revolving Credit Loans (subject to the
provision above regarding Swing Loans):
(i) Base Rate Option: A fluctuating rate per annum (computed
on the basis of a year of 365 or 366 days, as the case may be,
and actual days elapsed) equal to the Base Rate plus the
Applicable Margin, such interest rate to change automatically
from time to time effective as of the effective date of each
change in the Base Rate; or
(ii) Euro-Rate Option: A rate per annum (computed on the
basis of a year of 360 days and actual days elapsed) equal to
the Euro-Rate plus the Applicable Margin.
Notwithstanding the foregoing, if any Event of Default has
occurred and is continuing, no Loan may be made, converted to or renewed under
any Euro-Rate Option.
4.1.2. Rate Quotations.
The Borrower may call the Agent on or before the date on which
a Loan Request is to be delivered to receive an indication of the interest rates
then in effect, but it is acknowledged that such projection shall not be binding
on the Agent or the Banks nor affect the rate of interest which thereafter is
actually in effect when the election is made.
35
4.1.3. Change in Fees or Interest Rates.
If the Applicable Margin, Applicable Letter of Credit Fee Rate
or Applicable Facility Fee Rate is increased or reduced with respect to any
period for which the Borrower has already paid interest, the Facility Fee or the
Letter of Credit Fee, the Agent shall recalculate the additional interest,
Facility Fee or Letter of Credit Fee due from or to the Borrower and shall,
within fifteen (15) Business Days after the Borrower notifies the Agent of such
increase or decrease, give the Borrower and the Banks notice of such
recalculation.
4.1.3.1 Any additional interest, Facility Fee or Letter of
Credit Fee due from the Borrower shall be paid to the Agent for the account of
the Banks on the next date on which an interest or fee payment is due; provided,
however, that if there are no Loans outstanding or if the Loans are due and
payable, such additional interest, Facility Fee or Letter of Credit Fee shall be
paid promptly after receipt of written request for payment from the Agent.
4.1.3.2 Any interest, Facility Fee or Letter of Credit Fee
refund due to the Borrower shall be credited against payments otherwise due from
the Borrower on the next interest or fee payment due date or, if the Loans have
been repaid and the Banks are no longer committed to lend under this Agreement,
the Banks shall pay the Agent for the account of the Borrower such interest,
Facility Fee or Letter of Credit Fee refund not later than five Business Days
after written notice from the Agent to the Banks.
4.2 Interest Periods.
At any time when the Borrower shall select, convert to or renew a
Euro-Rate Option, the Borrower shall notify the Agent thereof by delivering a
Loan Request at least three (3) Business Days prior to the effective date of
such Interest Rate Option. The notice shall specify an Interest Period during
which such Interest Rate Option shall apply. Notwithstanding the preceding
sentence, the following provisions shall apply to any selection of, renewal of,
or conversion to a Euro-Rate Option:
4.2.1. Amount of Borrowing Tranche.
the amount of each Borrowing Tranche of Loans to which a
Euro-Rate Option applies shall be in integral multiples of $1,000,000 and not
less than $3,000,000;
4.2.2. Renewals.
in the case of the renewal of a Euro-Rate Option at the end of
an Interest Period, the first day of the new Interest Period shall be the last
day of the preceding Interest Period, without duplication in payment of interest
for such day.
4.3 Interest After Default.
To the extent permitted by Law, upon the occurrence of an Event of Default
and until such time such Event of Default shall have been cured or waived:
36
4.3.1. Letter of Credit Fees, Interest Rate.
the Letter of Credit Fee and the rate of interest for each
Loan otherwise applicable pursuant to Section 2.9.2 [Letter of Credit Fees] or
Section 4.1 [Interest Rate Options], respectively, shall be increased by 2.0%
per annum; and
4.3.2. Other Obligations.
each other Obligation hereunder if not paid when due shall
bear interest at a rate per annum equal to the sum of the rate of interest
applicable under the Base Rate Option plus an additional 2% per annum from the
time such Obligation becomes due and payable and until it is paid in full.
4.3.3. Acknowledgment.
The Borrower acknowledges that the increase in rates referred
to in this Section 4.3 reflects, among other things, the fact that such Loans or
other amounts have become a substantially greater risk given their default
status and that the Banks are entitled to additional compensation for such risk;
and all such interest shall be payable by Borrower upon demand by Agent.
4.4 Euro-Rate Unascertainable; Illegality; Increased Costs; Deposits Not
Available.
4.4.1. Unascertainable.
If on any date on which a Euro-Rate would otherwise be
determined with respect to Loans, the Agent shall have determined that:
(i) adequate and reasonable means do not exist for
ascertaining such Euro-Rate, or
(ii) a contingency has occurred which materially and
adversely affects the London interbank eurodollar market
relating to the Euro-Rate, the Agent shall have the rights
specified in Section 4.4.3.
4.4.2. Illegality; Increased Costs; Deposits Not Available.
If at any time any Bank shall have determined that:
(i) the making, maintenance or funding of any Loan to which a
Euro-Rate Option applies has been made unlawful or materially
impracticable by compliance by such Bank in good faith with
any Law or any interpretation or application thereof by any
Official Body or with any request or directive of any such
Official Body (whether or not having the force of Law), or
37
(ii) such Euro-Rate Option will not adequately and fairly
reflect the cost to such Bank of the establishment or
maintenance of any such Loan in a material respect, or
(iii) after making all reasonable efforts, deposits of the
relevant amount in Dollars for the relevant Interest Period
for a Loan, or to banks generally, to which a Euro-Rate Option
applies, respectively, are not available to such Bank with
respect to such Loan, or to banks generally, in the interbank
eurodollar market,
then the Agent shall have the rights specified in Section 4.4.3.
4.4.3. Agent's and Bank's Rights.
In the case of any event specified in Section 4.4.1 above, the
Agent shall promptly so notify the Banks and the Borrower thereof, and in the
case of an event specified in Section 4.4.2 above, such Bank shall promptly so
notify the Agent and endorse a certificate to such notice as to the specific
circumstances of such notice, and the Agent shall promptly send copies of such
notice and certificate to the other Banks and the Borrower. Upon such date as
shall be specified in such notice (which shall not be earlier than the date such
notice is given), the obligation of (A) the Banks, in the case of such notice
given by the Agent, or (B) such Bank, in the case of such notice given by such
Bank, to allow the Borrower to select, convert to or renew a Euro-Rate Option
shall be suspended until the Agent shall have later notified the Borrower, or
such Bank shall have later notified the Agent, of the Agent's or such Bank's, as
the case may be, determination that the circumstances giving rise to such
previous determination no longer exist. If at any time the Agent makes a
determination under Section 4.4.1 and the Borrower has previously notified the
Agent of its selection of, conversion to or renewal of a Euro-Rate Option and
such Interest Rate Option has not yet gone into effect, such notification shall
be deemed to provide for the selection of, conversion to or renewal of the Base
Rate Option otherwise available with respect to such Loans if the Borrower has
requested the Euro-Rate Option. If any Bank notifies the Agent of a
determination under Section 4.4.2, the Borrower shall, subject to the Borrower's
indemnification Obligations under Section 5.6.2 [Indemnity], as to any Loan of
the Bank to which a Euro-Rate Option applies, on the date specified in such
notice either (i) as applicable, convert such Loan to the Base Rate Option
otherwise available with respect to such Loan, or (ii) prepay such Loan in
accordance with Section 5.4.1 [Voluntary Prepayments]. Absent due notice from
the Borrower of conversion or prepayment, such Loan shall automatically be
converted to the Base Rate Option otherwise available with respect to such Loan
upon such specified date.
4.5 Selection of Interest Rate Options.
If the Borrower fails to select a new Interest Period to apply to any
Borrowing Tranche of Loans under the Euro-Rate Option at the expiration of an
existing Interest Period applicable to such Borrowing Tranche in accordance with
the provisions of Section 4.2 [Interest Periods], the Borrower shall be deemed
to have converted such Borrowing Tranche to the Base Rate Option, commencing
upon the last day of the existing Interest Period.
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5. PAYMENTS
5.1 Payments.
All payments and prepayments to be made in respect of principal, interest,
Facility Fees, Letter of Credit Fees, Agent's Fee or other fees or amounts due
from the Borrower hereunder shall be payable prior to 11:00 a.m., Pittsburgh
time, on the date when due without presentment, demand, protest or notice of any
kind, all of which are hereby expressly waived by the Borrower, and without
set-off, counterclaim or other deduction of any nature, and an action therefor
shall immediately accrue. Such payments shall be made to the Agent at the
Principal Office for the account of PNC Bank with respect to the Swing Loans and
for the ratable accounts of the Banks with respect to the Revolving Credit Loans
and in immediately available funds, and the Agent shall promptly distribute such
amounts to the Banks in immediately available funds, provided that in the event
payments are received by 11:00 a.m., Pittsburgh time, by the Agent with respect
to the Loans and such payments are not distributed to the Banks on the same day
received by the Agent, the Agent shall pay the Banks the Federal Funds Open
Rate, with respect to the amount of such payments for each day held by the Agent
and not distributed to the Banks. The Agent's and each Bank's statement of
account, ledger or other relevant record shall, in the absence of manifest
error, be conclusive as the statement of the amount of principal of and interest
on the Loans and other amounts owing under this Agreement and shall be deemed an
"account stated."
5.2 Pro Rata Treatment of Banks.
Each borrowing of Revolving Credit Loans shall be allocated to each Bank
according to its Ratable Share and each selection of, conversion to or renewal
of any Interest Rate Option applicable to Revolving Credit Loans and each
payment or prepayment by the Borrower with respect to principal or interest on
the Revolving Credit Loans or Facility Fees, Letter of Credit Fees, or other
fees (except for the Agent's Fee) or amounts due from the Borrower hereunder to
the Banks with respect to the Revolving Credit Loans shall (except as provided
in Section 4.4.3 [Agent's and Bank's Rights] in the case of an event specified
in Section 4.4 [Euro-Rate Unascertainable; Etc.], 5.4.2 [Replacement of a Bank]
or 5.6 [Additional Compensation in Certain Circumstances]) be made in proportion
to the applicable Revolving Credit Loans outstanding from each Bank and, if no
such Loans are then outstanding, in proportion to the Ratable Share in the case
of each Bank. Notwithstanding any of the foregoing, each borrowing or payment or
prepayment by the Borrower of principal, interest, fees or other amounts from
the Borrower with respect to Swing Loans shall be made by or to PNC Bank
according to Section 2.
5.3 Interest Payment Dates.
Interest on Swing Loans and on Loans to which the Base Rate Option applies
shall be due and payable quarterly in arrears on the first day of each January,
April, July and October after the date hereof and on the Expiration Date or upon
acceleration of the Loans. Interest on Loans to which the Euro-Rate Option
applies shall be due and payable on the last day of each
39
Interest Period for those Loans and, if such Interest Period is longer than
three (3) Months, also on the 90th day of such Interest Period.
5.4 Prepayments.
5.4.1. Voluntary Prepayments.
The Borrower shall have the right at its option from time to
time to prepay the Loans in whole or part without premium or penalty (except as
provided in Section 5.4.2 below or in Section 5.6 [Additional Compensation in
Certain Circumstances]):
(i) at any time with respect to Swing Loans or with respect to
any Loan to which the Base Rate Option applies,
(ii) on the last day of the applicable Interest Period with
respect to Loans to which a Euro-Rate Option applies, or
(iii) on the date specified in a notice by any Bank pursuant
to Section 4.4 [Euro-Rate Unascertainable, Etc.] with respect
to any Loan to which a Euro-Rate Option applies.
Whenever the Borrower desires to prepay any part of the Loans,
it shall provide a prepayment notice to the Agent by 1:00 p.m., Pittsburgh time,
at least one (1) Business Day prior to the date of prepayment of the Revolving
Credit Loans or no later than 2:00 p.m., Pittsburgh time, on the date of
prepayment of Swing Loans setting forth the following information:
(w) the date, which shall be a Business Day, on which the proposed
prepayment is to be made;
(x) a statement indicating the application of the prepayment among
the Revolving Credit Loans and Swing Loans;
(y) the total principal amount of such prepayment which, with
respect to Loans to which the Base Rate Option applies, shall not be less
than $500,000 for any Revolving Credit Loan and which, with respect to
Swing Loans, shall not be less than $500,000, and
(z) the total principal amount of such prepayment, which, with
respect to Loans to which the Euro-Rate Option applies, shall not be less
than $1,000,000 for any Revolving Credit Loan.
All prepayment notices shall be irrevocable. The principal amount of
the Loans for which a prepayment notice is given, together with interest on such
principal amount except with respect to Loans to which the Base Rate Option
applies, shall be due and payable on the date specified in such prepayment
notice as the date on which the proposed prepayment is to be made. Except as
provided in Section 4.4.3 [Agent's and Bank's Rights], if the Borrower
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prepays a Loan but fails to specify the applicable Borrowing Tranche which the
Borrower is prepaying, the prepayment shall be applied (i) first to Swing Loans
and second to Revolving Credit Loans; and (ii) after giving effect to the
allocations in clause (i) above and in the preceding sentence, first to Loans to
which the Swing Loan Interest Rate applies, second to Loans to which the Base
Rate Option applies, and then to Loans to which the Euro-Rate Option applies.
Any prepayment hereunder shall be subject to the Borrower's Obligation to
indemnify the Banks under Section 5.6.2 [Indemnity].
5.4.2. Replacement of a Bank.
In the event any Bank (i) gives notice under Section 4.4
[Euro-Rate Unascertainable, Etc.] or Section 5.6.1 [Increased Costs, Etc.], (ii)
does not fund Revolving Credit Loans because the making of such Loans would
contravene any Law applicable to such Bank, (iii) becomes subject to the control
of an Official Body (other than normal and customary supervision), or (iv)
causes the Borrower to pay, withhold or indemnify any Taxes or Other Taxes
pursuant to Section 5.8, then the Borrower shall have the right at its option,
with the consent of the Agent, which shall not be unreasonably withheld, to
prepay the Loans of such Bank in whole, together with all interest accrued
thereon, and terminate such Bank's Commitment within ninety (90) days after (w)
receipt of such Bank's notice under Section 4.4 [Euro-Rate Unascertainable,
Etc.] or 5.6.1 [Increased Costs, Etc.], (x) the date such Bank has failed to
fund Revolving Credit Loans because the making of such Loans would contravene
Law applicable to such Bank, (y) the date such Bank became subject to the
control of an Official Body, as applicable, or (z) the date such payment of
Taxes or Other Taxes pursuant to Section 5.8 is due; provided that the Borrower
shall also pay to such Bank at the time of such prepayment any amounts required
under Section 5.6 [Additional Compensation in Certain Circumstances] and Section
5.8 [Taxes] and any accrued interest due on such amount and any related fees;
provided, however, that the Commitment of such Bank shall be provided by one or
more of the remaining Banks or a replacement bank reasonably acceptable to the
Agent; provided, further, the remaining Banks shall have no obligation hereunder
to increase their Commitments. Notwithstanding the foregoing, the Agent may only
be replaced subject to the requirements of Section 10.14 [Successor Agent] and
provided that all Letters of Credit have expired or been terminated or replaced.
5.4.3. Change of Lending Office.
Each Bank agrees that prior to giving notice to any claim for
increased costs, indemnification or other special payments under Section 4.4.2
[Illegality, Etc.], 5.6.1 [Increased Costs, Etc.] or Section 5.8 [Taxes] with
respect to such Bank, it will have initiated reasonable efforts (subject to
overall policy considerations of such Bank) to designate another lending office
for any Loans or Letters of Credit affected by such event, provided that such
designation is made on such terms that such Bank and its lending office suffer
no economic, legal or regulatory disadvantage, with the object of avoiding the
consequence of the event giving rise to the operation of such Section. Nothing
in this Section 5.4.3 shall affect or postpone any of the Obligations of the
Borrower or any other Loan Party or the rights of the Agent or any Bank provided
in this Agreement.
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5.5 Voluntary Commitment Reductions.
The Borrower shall have the right, upon not less than five (5) Business
Days' written irrevocable notice to the Agent, to terminate the Commitments or,
from time to time, to reduce the amount of the Commitments, which notice shall
specify the date and amount of any such reduction and otherwise be substantially
in the form of Exhibit 5.5 (a "Commitment Reduction Notice"). Any such reduction
shall be in a minimum amount equal to $5,000,000 or an integral multiple
thereof, provided, that the Revolving Credit Commitments may not be reduced
below the aggregate principal amount of the Revolving Facility Usage. Each
reduction of Revolving Credit Commitments shall ratably reduce the Revolving
Credit Commitments of the Banks.
5.6 Additional Compensation in Certain Circumstances.
5.6.1. Increased Costs or Reduced Return Resulting From Taxes,
Reserves, Capital Adequacy Requirements, Expenses, Etc.
If any Law, guideline or interpretation or any change in any
Law, guideline or interpretation or application thereof by any Official Body
charged with the interpretation or administration thereof or compliance with any
request or directive (whether or not having the force of Law) of any central
bank or other Official Body:
(i) subjects any Bank to any tax or changes the basis of
taxation with respect to this Agreement, the Loans or payments
by the Borrower of principal, interest, Facility Fees, Letter
of Credit Fees or other amounts due from the Borrower
hereunder (except for taxes on the overall net income of such
Bank),
(ii) imposes, modifies or deems applicable any reserve,
special deposit or similar requirement against credits or
commitments to extend credit extended by, or assets (funded or
contingent) of, deposits with or for the account of, or other
acquisitions of funds by, any Bank or any lending office of
any Bank, or
(iii) imposes, modifies or deems applicable any capital
adequacy or similar requirement (A) against assets (funded or
contingent) of, or letters of credit, other credits or
commitments to extend credit extended by, any Bank, or (B)
otherwise applicable to the obligations of any Bank or any
lending office of any Bank under this Agreement,
and the result of any of the foregoing is to increase the cost to, reduce the
income receivable by, or impose any expense (including loss of margin) upon any
Bank or its lending office with respect to this Agreement or the making,
maintenance or funding of any part of the Loans (or, in the case of any capital
adequacy or similar requirement, to have the effect of reducing the rate of
return on any Bank's capital, taking into consideration such Bank's customary
policies with
42
respect to capital adequacy) by an amount which such Bank in its reasonable
discretion deems to be material, such Bank shall from time to time notify the
Borrower and the Agent of the amount determined in good faith (using any
averaging and attribution methods employed in good faith) by such Bank to be
necessary to compensate such Bank for such increase in cost, reduction of
income, additional expense or reduced rate of return. Such notice shall set
forth in reasonable detail the basis for such determination. Such amount shall
be due and payable by the Borrower to such Bank thirty (30) days after such
notice is given.
5.6.2. Indemnity.
In addition to the compensation required by Section 5.6.1
[Increased Costs, Etc.], the Borrower shall indemnify each Bank against all
liabilities, losses or expenses (including loss of margin, any loss or expense
incurred in liquidating or employing deposits from third parties and any loss or
expense incurred in connection with funds acquired by a Bank to fund or maintain
Loans subject to a Euro-Rate Option) which such Bank sustains or incurs as a
consequence of any
(i) payment, prepayment, conversion or renewal of any Loan to
which a Euro-Rate Option applies on a day other than the last
day of the corresponding Interest Period (whether or not such
payment or prepayment is mandatory, voluntary or automatic and
whether or not such payment or prepayment is then due),
(ii) attempt by the Borrower to revoke (expressly, by later
inconsistent notices or otherwise) in whole or part any Loan
Requests under Section 2.4 [Revolving Credit Loan Requests],
Section 2.5 [Swing Loan Requests] or Section 4.2 [Interest
Periods] or notice relating to voluntary prepayments under
Section 5.4.1 [Voluntary Prepayments] or notice relating to
voluntary Commitment reductions under Section 5.5 [Voluntary
Commitment Reductions], or
(iii) default by the Borrower in the performance or observance
of any covenant or condition contained in this Agreement or
any other Loan Document, including any failure of the Borrower
to pay when due (by acceleration or otherwise) any principal
of or interest on the Loans, Letter of Credit Fees, or
Facility Fees or any other amount due hereunder.
If any Bank sustains or incurs any such loss or expense, it
shall from time to time notify the Borrower of the amount determined in good
faith by such Bank (which determination may include such assumptions,
allocations of costs and expenses and averaging or attribution methods as such
Bank shall deem reasonable) to be necessary to indemnify such Bank for such loss
or expense. Such notice shall set forth in reasonable detail the basis for such
determination. Such amount shall be due and payable by the Borrower to such Bank
thirty (30) days after such notice is given.
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5.7 Interbank Market Presumption.
For all purposes of this Agreement and each Note with respect to any
aspects of the Euro-Rate or any Loan under the Euro-Rate Option, each Bank and
Agent shall be presumed to have obtained rates, funding, currencies, deposits,
and the like in the London interbank market regardless whether it did so or not;
and, each Bank's and Agent's determination of amounts payable under, and actions
required or authorized by, Sections 4.4 and 5.6 shall be calculated, at each
Bank's and Agent's option, as though each Bank and Agent funded its pro rata
share of each Borrowing Tranche of Loans under the Euro-Rate Option through the
purchase of deposits of the types and maturities corresponding to the deposits
used as a reference in accordance with the terms hereof in determining the
Euro-Rate applicable to such Loans, whether in fact that is the case.
5.8 Taxes.
5.8.1. No Deductions.
All payments made by Borrower hereunder and under each Note
shall be made free and clear of and without deduction for any present or future
taxes, levies, imposts, deductions, charges, or withholdings, and all
liabilities with respect thereto, excluding taxes imposed on the net income of
any Bank and all income and franchise taxes applicable to any Bank of the United
States (all such non-excluded taxes, levies, imposts, deductions, charges,
withholdings, and liabilities being hereinafter referred to as "Taxes"). If
Borrower shall be required by Law to deduct any Taxes from or in respect of any
sum payable hereunder or under any Note, (i) the sum payable shall be increased
as may be necessary so that after making all required deductions (including
deductions applicable to additional sums payable under this Section 5.8.1) each
Bank receives an amount equal to the sum it would have received had no such
deductions been made, (ii) Borrower shall make such deductions and (iii)
Borrower shall timely pay the full amount deducted to the relevant tax authority
or other authority in accordance with applicable Law.
5.8.2. Stamp Taxes.
In addition, Borrower agrees to pay any present or future
stamp or documentary taxes or any other excise or property taxes, charges, or
similar levies which arise from any payment made hereunder or from the
execution, delivery, or registration of, or otherwise with respect to, this
Agreement or any Note (hereinafter referred to as "Other Taxes").
5.8.3. Indemnification for Taxes Paid by a Bank.
Borrower shall indemnify each Bank for the full amount of
Taxes or Other Taxes(including, without limitation, any Taxes or Other Taxes
imposed by any jurisdiction on amounts payable under this Section 5.8.3) paid by
any Bank and any liability (including penalties, interest, and expenses) arising
therefrom or with respect thereto, whether or not such Taxes or Other Taxes were
correctly or legally asserted. This indemnification shall be made within 30 days
from the date a Bank makes written demand therefor.
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5.8.4. Certificate.
Within 30 days after the date of any payment of any Taxes by
Borrower, Borrower shall furnish to each Bank, at its address referred to
herein, the original or a certified copy of a receipt evidencing payment
thereof. If no Taxes are payable in respect of any payment by Borrower, such
Borrower shall, if so requested by a Bank, provide a certificate of an officer
of Borrower to that effect.
5.8.5. Survival.
Without prejudice to the survival of any other agreement of
Borrower hereunder, the agreements and obligations of Borrower contained in
Sections 5.8.1 through and including 5.8.4 shall survive the payment in full of
principal and interest hereunder and under any instrument delivered hereunder.
5.9 Notes.
Upon the request of any Bank, the Revolving Credit Loans made by such Bank
may be evidenced by a Revolving Credit Note in the form of Exhibit 1.1(R).
5.10 Settlement Date Procedures.
In order to minimize the transfer of funds between the Banks and the
Agent, the Borrower may borrow, repay and reborrow Swing Loans and PNC Bank may
make Swing Loans as provided in Section 2.1.2 hereof during the period between
Settlement Dates. Not later than 11:00 a.m., Pittsburgh time, on each Settlement
Date, the Agent shall notify each Bank of its Ratable Share of the total of the
Revolving Credit Loans and the Swing Loans (each a "Required Share"). Prior to
2:00 p.m., Pittsburgh time, on such Settlement Date, each Bank shall pay to the
Agent the amount equal to the difference between its Required Share and its
Revolving Credit Loans, and the Agent shall pay to each Bank its Ratable Share
of all payments made by the Borrower to the Agent with respect to the Revolving
Credit Loans. The Agent shall also effect settlement in accordance with the
foregoing sentence on the proposed Borrowing Dates for Revolving Credit Loans
and may at its option effect settlement on any other Business Day. These
settlement procedures are established solely as a matter of administrative
convenience, and nothing contained in this Section 5.10 shall relieve the Banks
of their obligations to fund Revolving Credit Loans on dates other than a
Settlement Date pursuant to Sections 2.1.1 and 2.2. The Agent may at any time at
its option for any reason whatsoever require each Bank to pay immediately to the
Agent such Bank's Ratable Share of the outstanding Revolving Credit Loans and
each Bank may at any time require the Agent to pay immediately to such Bank its
Revolving Credit Ratable Share of all payments made by the Borrower to the Agent
with respect to the Revolving Credit Loans.
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6. REPRESENTATIONS AND WARRANTIES
6.1 Representations and Warranties.
The Loan Parties, jointly and severally, represent and warrant to the
Agent and each of the Banks as follows:
6.1.1. Organization and Qualification.
Each Loan Party and each Subsidiary that is not an Inactive
Subsidiary of each Loan Party is a corporation, partnership or limited liability
company duly organized, validly existing and in good standing under the laws of
its jurisdiction of organization. Each Loan Party and each Subsidiary that is
not an Inactive Subsidiary of each Loan Party has the lawful power to own or
lease its properties and to engage in the business it presently conducts or
proposes to conduct. Each Loan Party and each Subsidiary that is not an Inactive
Subsidiary of each Loan Party is duly licensed or qualified and in good standing
in each jurisdiction where the failure to be so licensed or qualified could
reasonably be expected to result in a Material Adverse Change.
6.1.2. Subsidiaries.
Schedule 6.1.2 states the name of each of the Borrower's
Subsidiaries, its jurisdiction of incorporation, its authorized capital stock,
the issued and outstanding shares (referred to herein as the "Subsidiary
Shares") and the owners thereof if it is a corporation, its outstanding
partnership interests (the "Partnership Interests") if it is a partnership and
its outstanding limited liability company interests, interests assigned to
managers thereof and the voting rights associated therewith (the "LLC
Interests") if it is a limited liability company and also indicates if such
Subsidiary is an Inactive Subsidiary. The Borrower and each Subsidiary of the
Borrower has good and marketable title to all of the Subsidiary Shares,
Partnership Interests and LLC Interests it purports to own, free and clear in
each case of any Lien. All Subsidiary Shares, Partnership Interests and LLC
Interests have been validly issued, and all Subsidiary Shares are fully paid and
nonassessable. All capital contributions and other consideration required to be
made or paid in connection with the issuance of the Partnership Interests and
LLC Interests have been made or paid, as the case may be. There are no options,
warrants or other rights outstanding to purchase any such Subsidiary Shares,
Partnership Interests or LLC Interests except as indicated on Schedule 6.1.2.
6.1.3. Power and Authority.
Each Loan Party has full power to enter into, execute, deliver
and carry out this Agreement and the other Loan Documents to which it is a
party, to incur the Indebtedness contemplated by the Loan Documents and to
perform its Obligations under the Loan Documents to which it is a party, and all
such actions have been duly authorized by all necessary proceedings on its part.
46
6.1.4. Validity and Binding Effect.
This Agreement has been duly and validlyexecuted and delivered
by each Loan Party, and each other Loan Document which any Loan Party is
required to execute and deliver on or after the date hereof will have been duly
executed and delivered by such Loan Party on the required date of delivery of
such Loan Document. This Agreement and each other Loan Document constitutes, or
will constitute, legal, valid and binding obligations of each Loan Party which
is or will be a party thereto on and after its date of delivery thereof,
enforceable against such Loan Party in accordance with its terms, except to the
extent that enforceability of any of such Loan Document may be limited by
bankruptcy, insolvency, reorganization, moratorium or other similar laws
affecting the enforceability of creditors' rights generally or limiting the
right of specific performance.
6.1.5. No Conflict.
Neither the execution and delivery of this Agreement or the
other Loan Documents by any Loan Party nor the consummation of the transactions
herein or therein contemplated or compliance with the terms and provisions
hereof or thereof by any of them will conflict with, constitute a default under
or result in any breach of (i) the terms and conditions of the certificate of
incorporation, bylaws, certificate of limited partnership, partnership
agreement, certificate of formation, limited liability company agreement or
other organizational documents of any Loan Party or (ii) any Law or any material
agreement or instrument or order, writ, judgment, injunction or decree to which
any Loan Party or any of its Subsidiaries is a party or by which it or any of
its Subsidiaries is bound or to which it is subject, or result in the creation
or enforcement of any Lien, charge or encumbrance whatsoever upon any property
(now or hereafter acquired) of any Loan Party or any of its Subsidiaries (other
than Liens granted under the Loan Documents).
6.1.6. Litigation.
Except as set forth in the SEC Filings, there are no actions,
suits, proceedings or investigations (other than Environmental Complaints which
are specifically addressed in Section 6.1.21 [Environmental Matters]) pending
or, to the knowledge of any Loan Party, threatened against such Loan Party or
any Subsidiary of such Loan Party at law or equity before any Official Body
which individually or in the aggregate could reasonably be expected to result in
a Material Adverse Change. None of the Loan Parties or any Subsidiaries of any
Loan Party is in violation of any order, writ, injunction or any decree of any
Official Body which could reasonably be expected to result in any Material
Adverse Change.
6.1.7. Title to Properties.
Each Loan Party and each Subsidiary of eachLoan Party has good
and marketable title to or valid leasehold interest in all properties, assets
and other rights which it purports to own or lease or which are reflected as
owned or leased on its books and records, free and clear of all Liens and
encumbrances (other than Environmental Complaints which are specifically
addressed in Section 6.1.21 [Environmental Matters]) except Permitted Liens, and
47
subject to the terms and conditions of the applicable leases. All leases of
property are in full force and effect without the necessity for any consent
which has not previously been obtained upon consummation of the transactions
contemplated hereby.
6.1.8. Financial Statements.
(i) Historical Statements. The Borrower has delivered to the
Agent copies of its audited consolidated year-end financial
statements for and as of the end of the fiscal year ended
September 30, 2004 (the "Historical Statements"). The
Historical Statements were compiled from the books and records
maintained by the Borrower's management, are correct and
complete and fairly represent the consolidated financial
condition of the Borrower and its Subsidiaries as of their
dates and the results of operations for the fiscal periods
then ended and have been prepared in accordance with GAAP
consistently applied.
(ii) Accuracy of Financial Statements. Neither the Borrower
nor any Subsidiary of the Borrower has any liabilities,
contingent or otherwise, or forward or long-term commitments
that are not disclosed in the Historical Statements or in the
notes thereto, and except as disclosed therein there are no
unrealized or anticipated losses from any commitments of the
Borrower or any Subsidiary of the Borrower that could
reasonably be expected to cause a Material Adverse Change.
Since September 30, 2004, no Material Adverse Change has
occurred.
6.1.9. Use of Proceeds; Margin Stock; Section 20 Subsidiaries.
6.1.9.1 General.
The Loan Parties intend to use the proceeds of the Loans in
accordance with Sections 2.8 and 8.1.10.
6.1.9.2 Margin Stock.
None of the Loan Parties or any Subsidiaries of any Loan
Party engages or intends to engage principally, or as one of its important
activities, in the business of extending credit for the purpose, immediately,
incidentally or ultimately, of purchasing or carrying margin stock (within the
meaning of Regulation U). No part of the proceeds of any Loan has been or will
be used, immediately, incidentally or ultimately, to purchase or carry any
margin stock or to extend credit to others for the purpose of purchasing or
carrying any margin stock or to refund Indebtedness originally incurred for such
purpose, or for any purpose which entails a violation of or which is
inconsistent with the provisions of the regulations of the Board of Governors of
the Federal Reserve System. None of the Loan Parties or any Subsidiary of any
Loan Party holds or intends to hold margin stock in such amounts that more than
25% of the
48
reasonable value of the assets of any Loan Party or Subsidiary of any Loan Party
is or will be represented by margin stock.
6.1.9.3 Section 20 Subsidiaries.
The Loan Parties are unaware of any circumstances where any
portion of the proceeds of the Loans would be used to purchase any Ineligible
Securities being underwritten by a Section 20 Subsidiary.
6.1.10. Full Disclosure.
Neither this Agreement nor any other Loan Document, nor any
certificate, statement, agreement or other documents furnished to the Agent or
any Bank in connection herewith or therewith, contains any untrue statement of a
material fact or omits to state a material fact necessary in order to make the
statements contained herein and therein, in light of the circumstances under
which they were made, not misleading. There is no fact known to any Loan Party
that could reasonably be expected to result in a Material Adverse Change which
has not been set forth in this Agreement or in the certificates, statements,
agreements or other documents furnished in writing to the Agent and the Banks
prior to or at the date hereof in connection with the transactions contemplated
hereby or otherwise disclosed in the SEC Filings.
6.1.11. Taxes.
All federal, state, local and other tax returns required to
have been filed with respect to each Loan Party and each Subsidiary of each Loan
Party have been filed, and payment or adequate provision has been made for the
payment of all taxes, fees, assessments and other governmental charges which
have or may become due pursuant to said returns or to assessments received,
except (i) to the extent that such taxes, fees, assessments and other charges
are being contested in good faith by appropriate proceedings diligently
conducted and for which such reserves or other appropriate provisions if any, as
shall be required by GAAP shall have been made or (ii) to the extent that with
respect to taxes (other than any U.S. federal or state income taxes, state taxes
on equity or capital or comparable state taxes on income, equity or capital and
which are otherwise related to the conduct of business, or local real property
taxes all of which taxes are subject to the requirements of the immediately
preceding clause (i)), fees, assessments or other government charges, the
failure to so pay or so contest could not reasonably be expected to result in a
Material Adverse Change. There are no agreements or waivers extending the
statutory period of limitations applicable to any federal income tax return of
any Loan Party or Subsidiary of any Loan Party for any period.
6.1.12. Consents and Approvals.
No consent, approval, exemption, order or authorization of, or
a registration or filing with, any Official Body or any other Person is required
by any Law or any agreement in connection with the execution, delivery and
carrying out of this Agreement and the other Loan Documents by any Loan Party,
except as listed on Schedule 6.1.12, all of which shall
49
have been obtained or made on or prior to the Closing Date except as otherwise
indicated on Schedule 6.1.12.
6.1.13. No Event of Default; Compliance With Instruments.
No event has occurred and is continuing and no condition
exists or will exist after giving effect to the borrowings or other extensions
of credit to be made on the Closing Date under or pursuant to the Loan Documents
which constitutes an Event of Default or Potential Default. None of the Loan
Parties or any Subsidiaries of any Loan Party is in violation of (i) any term of
its certificate of incorporation, bylaws, certificate of limited partnership,
partnership agreement, certificate of formation, limited liability company
agreement or other organizational documents or (ii) any material agreement or
instrument to which it is a party or by which it or any of its properties may be
subject or bound where such violation could reasonably be expected to result in
a Material Adverse Change.
6.1.14. Patents, Trademarks, Copyrights, Licenses, Etc.
Each Loan Party and each Subsidiary of each Loan Party owns or
has the contractual right to use all the patents, trademarks, service marks,
trade names, copyrights, licenses, registrations, franchises, permits and rights
reasonably necessary to own and operate its properties and to carry on its
business as presently conducted and planned to be conducted by such Loan Party
or Subsidiary, without known possible, alleged or actual conflict with the
rights of others, except where the failure to do so could not reasonably be
expected to have a Material Adverse Change.
6.1.15. Insurance.
No notice has been given or claim made and no grounds exist to
cancel or avoid any of such policies or bonds or to reduce the coverage provided
thereby. Such policies and bonds provide adequate coverage from reputable and
financially sound insurers in amounts sufficient to insure the assets and risks
of each Loan Party and each Subsidiary of each Loan Party in accordance with
prudent business practice in the industry of the Loan Parties and their
Subsidiaries.
6.1.16. Compliance With Laws.
The Loan Parties and their Subsidiaries are in compliance in
all material respects with all applicable Laws (other than Environmental Laws
which are specifically addressed in Section 6.1.21 [Environmental Matters]) in
all jurisdictions in which any Loan Party or Subsidiary of any Loan Party is
presently or will be doing business except where the failure to do so could not
reasonably be expected to result in a Material Adverse Change.
6.1.17. Material Contracts; Burdensome Restrictions.
All material contracts relating to the business operations of
each Loan Party and each Subsidiary of any Loan Party, including all employee
benefit plans and Labor Contracts are valid, binding and enforceable upon such
Loan Party or Subsidiary and, to
50
the best of such Loan Parties' knowledge, each of the other parties thereto in
accordance with their respective terms; and there is no default thereunder, to
the Loan Parties' knowledge, with respect to parties other than such Loan Party
or Subsidiary. None of the Loan Parties or their Subsidiaries is bound by any
contractual obligation, or subject to any restriction in any organization
document, or any requirement of Law which could reasonably be expected to result
in a Material Adverse Change.
6.1.18. Investment Companies; Regulated Entities.
None of the Loan Parties or any Subsidiaries of any Loan Party
is an "investment company" registered or required to be registered under the
Investment Company Act of 1940 or under the "control" of an "investment company"
as such terms are defined in the Investment Company Act of 1940 and shall not
become such an "investment company" or under such "control". None of the Loan
Parties or any Subsidiaries of any Loan Party is a "holding company" or an
"affiliate" of a "holding company" or of a "subsidiary company" of a "holding
company" within the meaning of the Public Utility Holding Company Act of 1935,
as amended. None of the Loan Parties or any Subsidiaries of any Loan Party is
subject to any other federal or state statute or regulation limiting its ability
to incur Indebtedness for borrowed money.
6.1.19. Plans and Benefit Arrangements.
(i) The Borrower and each other member of the ERISA Group are
in compliance in all material respects with any applicable
provisions of ERISA with respect to all Benefit Arrangements,
Plans and Multiemployer Plans. There has been no Prohibited
Transaction with respect to any Benefit Arrangement or any
Plan or, to the best knowledge of the Borrower, with respect
to any Multiemployer Plan or Multiple Employer Plan, which
could result in any material liability of the Borrower or any
other member of the ERISA Group. The Borrower and all other
members of the ERISA Group have made when due any and all
payments required to be made under any agreement relating to a
Multiemployer Plan or a Multiple Employer Plan or any Law
pertaining thereto. With respect to each Plan and
Multiemployer Plan, the Borrower and each other member of the
ERISA Group (i) have fulfilled in all material respects their
obligations under the minimum funding standards of ERISA, (ii)
have not incurred any liability to the PBGC, and (iii) have
not had asserted against them any penalty for failure to
fulfill the minimum funding requirements of ERISA. All Plans,
Benefit Arrangements and Multiemployer Plans have been
administered in all material respects in accordance with their
terms and applicable Law.
(ii) No event requiring notice to the PBGC under Section
302(f)(4)(A) of ERISA has occurred or is reasonably expected
to occur with respect to any Plan, and no amendment with
51
respect to which security is required under Section 307 of
ERISA has been made or is reasonably expected to be made to
any Plan.
(iii) Neither the Borrower nor any other member of the ERISA
Group has incurred or reasonably expects to incur any material
withdrawal liability under ERISA to any Multiemployer Plan or
Multiple Employer Plan. Neither the Borrower nor any other
member of the ERISA Group has been notified by any
Multiemployer Plan or Multiple Employer Plan that such
Multiemployer Plan or Multiple Employer Plan has been
terminated within the meaning of Title IV of ERISA and, to the
best knowledge of the Borrower, no Multiemployer Plan or
Multiple Employer Plan is reasonably expected to be
reorganized or terminated, within the meaning of Title IV of
ERISA.
6.1.20. Employment Matters.
Each of the Loan Parties and each of their Subsidiaries is in
compliance with the Labor Contracts and all applicable federal, state and local
labor and employment Laws including those related to equal employment
opportunity and affirmative action, labor relations, minimum wage, overtime,
child labor, medical insurance continuation, worker adjustment and relocation
notices, immigration controls and worker and unemployment compensation, where
the failure to comply could reasonably be expected to result in a Material
Adverse Change. There are no outstanding grievances, arbitration awards or
appeals therefrom arising out of the Labor Contracts or current or threatened
strikes, picketing, handbilling or other work stoppages or slowdowns at
facilities of any of the Loan Parties or any of their Subsidiaries which in any
case could reasonably be expected to result in a Material Adverse Change. The
Borrower has delivered to the Agent true and correct copies of each of the Labor
Contracts.
6.1.21. Environmental Matters.
None of the Loan Parties or any Subsidiaries of any Loan Party
has received any Environmental Complaint and none of the Loan Parties has any
reason to believe that such an Environmental Complaint might be received. There
are no pending or, to any Loan Party's knowledge, threatened Environmental
Complaints relating to any Loan Party or Subsidiary of any Loan Party or any of
the Properties or, to any Loan Party's knowledge, any prior owner, operator or
occupant of any of the Properties pertaining to, or arising out of, any
Contamination or violations of Environmental Laws or Environmental Permits which
could reasonably be expected to result in a Material Adverse Change. The Loan
Parties and their Subsidiaries are in compliance with all applicable
Environmental Laws in all jurisdictions in which any Loan Party or Subsidiary of
any Loan Party is doing business except where the failure to do so could not
reasonably be expected to result in a Material Adverse Change. The Loan Parties
and their Subsidiaries hold and are operating in compliance with Environmental
Permits, except where the failure to do so could not reasonably be expected to
result in a Material Adverse Change.
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6.1.22. Senior Debt Status.
The Obligations of each Loan Party under this Agreement, the
Guaranty Agreement and each of the other Loan Documents to which it is a party
do rank and will rank at least pari passu in priority of payment with all other
Indebtedness of such Loan Party except Indebtedness of such Loan Party to the
extent secured by Permitted Liens. There is no Lien upon or with respect to any
of the properties or income of any Loan Party or Subsidiary of any Loan Party
which secures indebtedness or other obligations of any Person except for
Permitted Liens.
6.1.23. Hedging Contract Policies.
Schedule 6.1.23 is a true and correct copy of the Hedging
Contract Policies. Each Loan Party and each Subsidiary of any Loan Party is
subject to and is in compliance with the Hedging Contract Policies
(notwithstanding that such policies only refer specifically to NJR Energy
Services Company) as if such policies were the stated policies of each Loan
Party and each Subsidiary of each Loan Party, and the Borrower shall cause each
Loan Party and each Subsidiary of any Loan Party which engages in any Hedging
Transaction to continue to comply with the Hedging Contract Policies as if such
policies were the stated policies of each Loan Party and each Subsidiary of each
Loan Party.
6.1.24. Permitted Related Business Opportunities.
The information set forth on Schedule 6.1.24 is true, complete
and correct in all material respects and sets forth a list of the Investments in
Permitted Related Business Opportunities by the Loan Parties and their
Subsidiaries as of the Closing Date and includes, without limitation, the amount
and nature of each such Investment, a description of the activities engaged in
by the Loan Parties and their Subsidiaries in connection with such Investment,
and a description of the activities engaged in by the Person in which the
Investment has been made.
6.1.25. Anti-Terrorism Laws; Executive Order No. 13224.
None of the Loan Parties nor any Subsidiary of any Loan Party
is any of the following (each a "Blocked Person"):
(i) a Person that is listed in the annex to, or is otherwise
subject to the provisions of, the Executive Order No. 13224;
(ii) a Person owned or controlled by, or acting for or on
behalf of, any Person that is listed in the annex to, or is otherwise subject to
the provisions of, the Executive Order No. 13224;
(iii) a Person or entity with which any Bank is prohibited
from dealing or otherwise engaging in any transaction by any Anti-Terrorism Law;
53
(iv) a Person or entity that commits, threatens or conspires
to commit or supports "terrorism" as defined in the Executive Order No. 13224;
(v) a Person or entity that is named as a"specially designated
national" on the most current list published by the United States Treasury
Department Office of Foreign Asset Control at its official website or any
replacement website or other replacement official publication of such list, or
(vi) a Person or entity who is affiliated or associated with a
Person or entity listed above.
6.2 Continuation of Representations.
The Loan Parties make the representations and warranties in this Section 6
on the date hereof, on the Closing Date, and each date thereafter on which a
Loan is made or a Letter of Credit is issued as provided in and subject to
Sections 7.1 and 7.2.
7. CONDITIONS OF LENDING AND ISSUANCE OF LETTERS OF CREDIT
The obligation of each Bank to make Loans and of the Agent to issue Letters
of Credit hereunder is subject to the performance by each of the Loan Parties of
its Obligations to be performed hereunder at or prior to the making of any such
Loans or issuance of such Letters of Credit and to the satisfaction of the
following further conditions:
7.1 Conditions to First Loans and Letters of Credit.
On the Closing Date:
7.1.1. Officer's Certificate.
The representations and warranties of each of the Loan Parties
contained in Section 6 and in each of the other Loan Documents shall be true and
accurate on and as of the Closing Date with the same effect as though such
representations and warranties had been made on and as of such date (except
representations and warranties which relate solely to an earlier date or time,
which representations and warranties shall be true and correct on and as of the
specific dates or times referred to therein), and each of the Loan Parties shall
have performed and complied with all covenants and conditions hereof and
thereof, no Event of Default or Potential Default shall have occurred and be
continuing or shall exist; and there shall be delivered to the Agent for the
benefit of each Bank a certificate of each of the Loan Parties, dated the
Closing Date and signed by the Chief Executive Officer, President, Chief
Financial Officer or other Authorized Officer of each of the Loan Parties, to
each such effect.
54
7.1.2. Secretary's Certificate.
There shall be delivered to the Agent for the benefit of each
Bank a certificate dated the Closing Date and signed by the Secretary or an
Assistant Secretary of each of the Loan Parties, certifying as appropriate as
to:
(i) all action taken by each Loan Party in connection with
this Agreement and the other Loan Documents;
(ii) the names of the officer or officers authorized to sign
this Agreement and the other Loan Documents and the true
signatures of such officer or officers and specifying the
Authorized Officers permitted to act on behalf of each Loan
Party for purposes of this Agreement and the true signatures
of such officers, on which the Agent and each Bank may
conclusively rely; and
(iii) copies of its organizational documents, including its
certificate of incorporation, bylaws, certificate of limited
partnership, partnership agreement, certificate of formation,
and limited liability company agreement as in effect on the
Closing Date certified by the appropriate state official where
such documents are filed in a state office together with
certificates from the appropriate state officials as to the
continued existence and good standing of each Loan Party in
each state where organized or qualified to do business and a
bring-down certificate by facsimile dated the Closing Date.
7.1.3. Opinion of Counsel.
There shall be delivered to the Agent forthe benefit of each
Bank a written opinion of (a) Windels Marx Lane & Mittendorf, LLP, counsel for
the Loan Parties (who may rely on the opinions of such other counsel and
Certificates of the Borrower's in-house counsel as may be reasonably acceptable
to the Agent), dated the Closing Date and in substantially the form attached
hereto as Exhibit 7.1.3(A), and (b) Oleta J. Harden, in-house counsel for the
Loan Parties, dated the Closing Date and in substantially the form attached
hereto as Exhibit 7.1.3(B).
7.1.4. Legal Details.
All legal details and proceedings in connection with the
transactions contemplated by this Agreement and the other Loan Documents shall
be in form and substance satisfactory to the Agent and counsel for the Agent,
and the Agent shall have received all such other counterpart originals or
certified or other copies of such documents and proceedings in connection with
such transactions, in form and substance satisfactory to the Agent and said
counsel, as the Agent or said counsel may reasonably request. The Agent shall
have received this Agreement executed by the Borrower and each Bank.
55
7.1.5. Payment of Fees.
The Borrower shall have paid or caused to be paid to the Agent
for itself and for the account of the Banks to the extent not previously paid
all fees accrued through the Closing Date and the costs and expenses for which
the Agent and the Banks are entitled to be reimbursed.
7.1.6. Consents.
The material consents, if any, required to effectuate the
transactions contemplated hereby as set forth on Schedule 6.1.12 shall have been
obtained.
7.1.7. Officer's Certificate Regarding MACs.
Since September 30, 2004, no Material Adverse Change shall
have occurred; prior to the Closing Date, there shall have been no material
change in the management of any Loan Party or Subsidiary of any Loan Party; and
there shall have been delivered to the Agent for the benefit of each Bank a
certificate dated the Closing Date and signed by the Chief Executive Officer,
President, Chief Financial Officer or other Authorized Officer of each Loan
Party to each such effect.
7.1.8. No Violation of Laws.
The making of the Loans and the issuance of the Letters of
Credit shall not contravene any Law applicable to any Loan Party or any of the
Banks.
7.1.9. No Actions or Proceedings.
No action, proceeding, investigation, regulation or
legislation shall have been instituted, threatened or proposed before any court,
governmental agency or legislative body to enjoin, restrain or prohibit, or to
obtain damages in respect of, this Agreement, the other Loan Documents or the
consummation of the transactions contemplated hereby or thereby or which, in the
Agent's sole discretion, would make it inadvisable to consummate the
transactions contemplated by this Agreement or any of the other Loan Documents.
7.1.10. Delivery of Guaranty Agreements.
The Guaranty Agreement shall have been duly executed and
delivered to the Agent for the benefit of the Banks.
7.1.11. Hedging Contract Policies.
The Loan Parties shall have delivered to the Agent and each
Bank a true and complete copy of the Hedging Contract Policies, and the Hedging
Contract Policies shall be satisfactory in form and substance to each Bank.
56
7.1.12. Termination of Commitments and Repayment of Outstanding
Indebtedness.
The Loan Parties shall have repaid all obligations,
indebtedness, interest fees, expenses and other amounts due and owing under
Existing Credit Facility, all commitments to lend thereunder shall have been
irrevocably terminated and all letters of credit issued thereunder shall have
been terminated (except for the Existing Letters of Credit), all to the
satisfaction of the Agent.
7.2 Each Additional Loan or Letter of Credit.
At the time of making any Loans or issuing any Letters of Credit other
than Loans made or Letters of Credit issued on the Closing Date and after giving
effect to the proposed extensions of credit: the representations and warranties
of the Loan Parties contained in Section 6 and in the other Loan Documents shall
be true on and as of the date of such additional Loan or Letter of Credit with
the same effect as though such representations and warranties had been made on
and as of such date (except representations and warranties which expressly
relate solely to an earlier date or time, which representations and warranties
shall be true and correct on and as of the specific dates or times referred to
therein) and the Loan Parties shall have performed and complied with all
covenants and conditions hereof; no Event of Default or Potential Default shall
have occurred and be continuing or shall exist; the making of the Loans or
issuance of such Letters of Credit shall not contravene any Law applicable to
any Loan Party or Subsidiary of any Loan Party or any of the Banks; and the
Borrower shall have delivered to the Agent a duly executed and completed Loan
Request, Swing Loan Request, or application for a Letter of Credit as the case
may be.
8. COVENANTS
8.1 Affirmative Covenants.
The Loan Parties, jointly and severally, covenant and agree that until
payment in full of the Loans, Reimbursement Obligations and Letter of Credit
Borrowings, and interest thereon, expiration or termination of all Letters of
Credit, satisfaction of all of the Loan Parties' other Obligations under the
Loan Documents and termination of the Commitments, the Loan Parties shall comply
at all times with the following affirmative covenants:
8.1.1. Preservation of Existence, Etc.
Each Loan Party shall, and shall cause each of its
Subsidiaries to, maintain its legal existence as a corporation, limited
partnership or limited liability company and its license or qualification and
good standing in each jurisdiction in which its ownership or lease of property
or the nature of its business makes such license or qualification necessary,
except (i) where the lack of legal existence of any Subsidiary or the failure to
be so licensed or qualified could not reasonably be expected to have a Material
Adverse Change, or (ii) as otherwise expressly permitted in Section 8.2.5
[Liquidations, Mergers, Etc.].
57
8.1.2. Payment of Liabilities, Including Taxes, Etc.
Each Loan Party shall, and shall cause each of its
Subsidiaries to, duly pay and discharge all liabilities to which it is subject
or which are asserted against it, promptly as and when the same shall become due
and payable, including all taxes, assessments and governmental charges upon it
or any of its properties, assets, income or profits, prior to the date on which
penalties attach thereto, except to the extent that such liabilities, including
taxes, assessments or charges, are being contested in good faith and by
appropriate and lawful proceedings diligently conducted and for which such
reserve or other appropriate provisions, if any, as shall be required by GAAP
shall have been made, but only to the extent that failure to discharge any such
liabilities would not result in any additional liability which could reasonably
be expected to result in a Material Adverse Change.
8.1.3. Maintenance of Insurance.
Each Loan Party shall, and shall cause each of its
Subsidiaries to, insure its properties and assets against loss or damage by fire
and such other insurable hazards as such assets are commonly insured (including
fire, extended coverage, property damage, workers' compensation, public
liability and business interruption insurance) and against other risks
(including errors and omissions) in such amounts as similar properties and
assets are insured by prudent companies in similar circumstances carrying on
similar businesses, and with reputable and financially sound insurers, including
self-insurance to the extent customary.
8.1.4. Maintenance of Properties and Leases.
Each Loan Party shall, and shall cause each of its
Subsidiaries to, maintain in good repair, working order and condition (ordinary
wear and tear excepted) in accordance with the general practice of other
businesses of similar character and size, all of those properties useful or
necessary to its business, and from time to time, such Loan Party will make or
cause to be made all appropriate repairs, renewals or replacements thereof.
8.1.5. Maintenance of Patents, Trademarks, Etc.
Each Loan Party shall, and shall cause each of its
Subsidiaries to, maintain in full force and effect all patents, trademarks,
service marks, trade names, copyrights, licenses, franchises, permits and other
authorizations necessary for the ownership and operation of its properties and
business if the failure so to maintain the same could constitute a Material
Adverse Change.
8.1.6. Visitation Rights.
Each Loan Party shall, and shall cause each of its
Subsidiaries to, permit any of the officers or authorized employees or
representatives of the Agent or any of the Banks to visit and inspect any of its
properties and to examine and make excerpts from its books and records and
discuss its business affairs, finances and accounts with its officers, all in
such detail and at such times and as often as any of the Banks may reasonably
request, provided that each Bank shall provide the Borrower and the Agent with
reasonable notice prior to any visit or
58
inspection, and, prior to an Event of Default, any such visit or inspection
shall occur during regular business hours. In the event any Bank desires to
conduct an audit of any Loan Party, such Bank shall make a reasonable effort to
conduct such audit contemporaneously with any audit to be performed by the
Agent, and prior to an Event of Default, any such audit (whether by the Agent or
any Bank) shall be at the sole cost and expense of the Agent or such Bank, as
the case may be.
8.1.7. Keeping of Records and Books of Account.
The Borrower shall, and shall cause each Subsidiary of the
Borrower to, maintain and keep proper books of record and account which enable
the Borrower and its Subsidiaries to issue financial statements in accordance
with GAAP and as otherwise required by applicable Laws of any Official Body
having jurisdiction over the Borrower or any Subsidiary of the Borrower, and in
which full, true and correct entries shall be made in all material respects of
all its dealings and business and financial affairs.
8.1.8. Plans and Benefit Arrangements.
The Borrower shall, and shall cause each other member of the
ERISA Group to, comply with ERISA, the Internal Revenue Code and other
applicable Laws applicable to Plans and Benefit Arrangements except where such
failure, alone or in conjunction with any other failure, would not reasonably be
expected to result in a Material Adverse Change. Without limiting the generality
of the foregoing, the Borrower shall cause all of its Plans and all Plans
maintained by any member of the ERISA Group to be funded in accordance with the
minimum funding requirements of ERISA and shall make, and cause each member of
the ERISA Group to make, in a timely manner, all contributions due to Plans,
Benefit Arrangements and Multiemployer Plans.
8.1.9. Compliance With Laws.
Each Loan Party shall, and shall cause each of its
Subsidiaries to, comply with all applicable Laws, including all Environmental
Laws, in all material respects, provided that it shall not be deemed to be a
violation of this Section 8.1.9 if any failure to comply with any Law would not
result in fines, penalties, costs associated with the performance of any
Remedial Actions, other similar liabilities or injunctive relief which in the
aggregate could not reasonably be expected to result in a Material Adverse
Change. Without limiting the generality of the foregoing, each Loan Party shall,
and shall cause each of its Subsidiaries to, obtain, maintain, renew and comply
with all Environmental Permits applicable to their respective operations and
activities, provided that it shall not be deemed to be a violation of this
Section 8.1.9 if any failure to do so would not result in cease and desist
orders or fines, penalties or other similar liabilities or injunctive relief
which in the aggregate could not reasonably be expected to result in a Material
Adverse Change.
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8.1.10. Use of Proceeds.
The Loan Parties will use the Letters of Credit and the
proceeds of the Loans only for general corporate purposes of the Borrower and
for working capital of the Borrower (including, without limitation (i) the use
of Letters of Credit to support obligations arising in the ordinary course of
the business of the Loan Parties, as such business is permitted to be conducted
pursuant to Section 8.2.9 and (ii) to repay and terminate Indebtedness
outstanding under the Existing Credit Facility). The Loan Parties shall not use
the Letters of Credit or the proceeds of the Loans for any purposes which
contravenes any applicable Law or any provision hereof.
8.1.11. Hedging Contract Policies.
Each Loan Party and each Subsidiary of each Loan Party shall
comply with the Hedging Contract Policies (notwithstanding that such policies
only refer specifically to NJR Energy Services Company) as if such policies were
the stated policies of each Loan Party and each Subsidiary of each Loan Party.
8.2 Negative Covenants.
The Loan Parties, jointly and severally, covenant and agree that until
payment in full of the Loans, Reimbursement Obligations and Letter of Credit
Borrowings, and interest thereon, expiration or termination of all Letters of
Credit, satisfaction of all of the Loan Parties' other Obligations hereunder and
termination of the Commitments, the Loan Parties shall comply with the following
negative covenants:
8.2.1. Indebtedness.
Each of the Loan Parties shall not, and shall not permit any
of its Subsidiaries to, at any time create, incur, assume or suffer to exist any
Indebtedness, except:
(i) Indebtedness under the Loan Documents;
(ii) Existing Indebtedness as set forth on Schedule 8.2.1
(including any extensions or renewals thereof, provided there
is no increase in the amount thereof or other significant
change in the terms thereof unless otherwise specified on
Schedule 8.2.1);
(iii) Indebtedness of a Loan Party to another Loan Party;
(iv) Additional Indebtedness issued by New Jersey Natural Gas
in accordance with Article Two of the Mortgage Indenture (as
the Mortgage Indenture is in effect on the Closing Date),
provided that such additional Indebtedness shall not contain
(i) covenants, defaults and other terms and conditions more
restrictive than those contained in this Agreement or (ii) any
negative covenants, financial covenants, and defaults that are
not also contained in this
60
Agreement, and shall specifically and expressly not contain
any covenant or agreement with respect to the issuance or
payment of dividends more restrictive than the restrictions
contained in Section 4.1 of the Twenty-Sixth Supplemental
Indenture dated as of October 1, 1995, supplemental to the
Mortgage Indenture;
(v) Additional, unsecured Indebtedness of the Borrower
incurred after the Closing Date, not to exceed at any time
outstanding, after giving effect thereto, 65% of Consolidated
Total Capitalization, so long as, both before and after giving
effect to any proposed additional Indebtedness: (a) no Default
or Event of Default shall have occurred and be continuing, and
(b) provided that such additional Indebtedness shall not
contain (i) covenants, defaults and other terms and conditions
more restrictive than those contained in this Agreement or
(ii) any negative covenants, financial covenants, and defaults
that are not also contained in this Agreement;
(vi) Additional Indebtedness, in respect of capitalized
leases (including, without limitation, capitalized leases for
metered assets) not to exceed at any time outstanding in the
aggregate for the Loan Parties and their Subsidiaries
$60,000,000;
(vii) Additional Indebtedness of NJR Energy Services Company
or New Jersey Natural Gas Company (each being a New Jersey
corporation) arising under any Hedging Transaction;
(viii) Additional Indebtedness, at any time outstanding not to
exceed $10,000,000, secured by Liens permitted by Section
8.2.2(i);
(ix) Indebtedness of New Jersey Natural Gas under the NJNG
Credit Agreement;
(x) the NJR Notes and any refinancing thereof, so long as
any Indebtedness refinancing the NJR Notes: (a) is unsecured,
(b) is on terms (including, without limitation the events of
default, covenants, and prepayment, redemption and repurchase
provisions) no more restrictive in any material respect than
the NJR Note Agreement unless the Borrower shall have
irrevocably offered the Agent and the Banks to enter at any
time into an amendment of this Agreement to add to this
Agreement substantially similar covenants, provisions or
Events of Default, as the case may be, (c) has a maturity date
no earlier than 180 days after the Expiration Date, and (d)
has an interest rate not materially in excess of
61
prevailing rates at such time for like transactions with a
borrower of comparable credit rating to the Borrower;
(xi) the NJNG Notes and any refinancing thereof, so long as
any Indebtedness refinancing the NJNG Notes: (a) is unsecured,
(b) is on terms (including, without limitation the events of
default, covenants, and prepayment, redemption and repurchase
provisions) no more restrictive in any material respect than
the NJNG Note Agreement unless the Borrower shall have
irrevocably offered the Agent and the Banks to enter at any
time into an amendment of this Agreement to add to this
Agreement substantially similar covenants, provisions or
Events of Default, as the case may be, (c) has a maturity date
no earlier than 180 days after the Expiration Date, and (d)
has an interest rate not materially in excess of prevailing
rates at such time for like transactions with a borrower of
comparable credit rating to NJNG;
(xii) Indebtedness, secured by Purchase Money Security
Interests as permitted by clause (xi) of the definition of
Permitted Liens, not to exceed at any time outstanding in the
aggregate for the Loan Parties and their Subsidiaries
$20,000,000; and
(xiii) Indebtedness not to exceed at any time outstanding in
the aggregate for the Loan Parties and their Subsidiaries
$75,000,000, so long as: (a) such Indebtedness is Indebtedness
of an Acquired Person which existed prior to the consummation
of the Permitted Acquisition in connection with which such
Acquired Person was acquired by a Loan Party and such
Indebtedness was not incurred in contemplation of or in
connection with such Permitted Acquisition; and (b) such
Indebtedness if secured is secured by Liens permitted by
clause (xii) of the definition of Permitted Liens.
8.2.2. Liens.
Each of the Loan Parties shall not, and shall not permit any
of its Subsidiaries to, at any time create, incur, assume or suffer to exist any
Lien on any of its property or assets, tangible or intangible, now owned or
hereafter acquired, or agree or become liable to do so, except:
(i) Liens existing on such property at the time of the
acquisition of such property; provided that the fair market
value of all assets secured as permitted by this Section 8.2.2
clause (i) shall not exceed, at any time, $10,000,000 and
provided further that the Indebtedness secured by Liens
permitted by this Section 8.2.2 clause (i) shall not at any
time outstanding exceed $10,000,000;
62
(ii) Permitted Liens;
(iii) Extensions or renewals of any Lien described in clause
(i) or (ii) of this Section 8.2.2, provided that: (a) any such
extension or renewal shall be limited to the property
theretofore subject to such Lien, and (b) the principal amount
of the Indebtedness secured by such Lien shall not be
increased and shall otherwise be permitted by Section 8.2.1;
and
(iv) in the case of New Jersey Gas Company (being a New
Jersey corporation) and its Subsidiaries, Liens permitted
pursuant to Section 8.2.2 of the NJNG Credit Agreement.
Notwithstanding the foregoing or any other provision of the
Loan Documents to the contrary, each of the Loan Parties shall not, and shall
not permit any of its Subsidiaries to, at any time create, incur, assume or
suffer to exist any Lien on, or agree or become liable to do so, any of the
capital stock of New Jersey Natural Gas.
8.2.3. Guaranties.
Each of the Loan Parties shall not, and shall not permit any
of its Subsidiaries to, at any time, directly or indirectly, become or be liable
in respect of any Guaranty, or assume, guarantee, become surety for, endorse or
otherwise agree, become or remain directly or contingently liable upon or with
respect to any obligation or liability of any other Person, except for
(i) Guaranties of Indebtedness of the Loan Parties permitted
pursuant to Section 8.2.1 [Indebtedness], (provided however,
that the NJR Notes shall not be guaranteed by any Loan Party
or any Subsidiary of a Loan Party unless such Person is also a
Guarantor, and provided, further that the NJNG Notes shall not
be guaranteed by any Subsidiary of New Jersey Natural Gas
unless such Subsidiary is a guarantor of the NJNG Credit
Agreement);
(ii) Guaranties of any Loan Party or any of its Subsidiaries
of obligations of NJR Energy Services Company or New Jersey
Natural Gas Company (each being a New Jersey corporation)
arising under any Hedging Transaction;
(iii) Guaranties by the Borrower of various obligations of any
of its Subsidiaries in connection with any transaction arising
in connection with its ordinary course of business as
conducted on the Closing Date or as otherwise permitted to be
conducted pursuant to Section 8.2.9; and
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(iv) Guaranties of any Loan Party or any of its Subsidiaries
of Indebtedness permitted by clause (xiii) of Section 8.2.1
[Indebtedness].
8.2.4. Loans and Investments.
Each of the Loan Parties shall not, and shall not permit any
of its Subsidiaries to, at any time make or suffer to remain outstanding any
loan or advance to, or purchase, acquire or own any stock, bonds, notes or
securities of, or any partnership interest (whether general or limited) or
limited liability company interest in, or any other investment or interest in,
or make any capital contribution to, any other Person, or agree, become or
remain liable to do any of the foregoing (any of the foregoing being an
"Investment"), except:
(i) trade credit extended on usual and customary terms in
the ordinary course of business;
(ii) advances to employees to meet expenses incurred by such
employees in the ordinary course of business;
(iii) Permitted Investments;
(iv) loans, advances and investments in other Loan Parties;
and
(v) any Investment which constitutes a Permitted Acquisition
in accordance with Section 8.2.5 [Liquidations, Mergers, Consolidations,
Acquisitions].
8.2.5. Liquidations, Mergers, Consolidations, Acquisitions.
Each of the Loan Parties shall not, and shall not permit any
of its Subsidiaries to, dissolve, liquidate or wind-up its affairs, or become a
party to any merger or consolidation, or acquire by purchase, lease or otherwise
all or substantially all of the assets or capital stock of any other Person,
provided that:
(1) any Loan Party other than the Borrower may consolidate
or merge into another Loan Party which is wholly-owned by one or more of the
other Loan Parties,
(2) any Inactive Subsidiary of the Borrower may dissolve,
liquidate or wind-up its affairs or any Inactive Subsidiary of the Borrower may
consolidate or merge into: (a) any other Inactive Subsidiary of the Borrower, or
(b) any Loan Party, other than the Borrower, so long as such Inactive Subsidiary
has no liabilities, contingent or otherwise, other than Indebtedness permitted
by Section 8.2.1, and
(3) any Loan Party may acquire, whether by purchase or by
merger, (A) all of the ownership interests of another Person or (B)
substantially all of assets of another Person or of a business or division of
another Person (each an "Permitted Acquisition"), provided that each of the
following requirements is met:
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a. if the Loan Parties are acquiring the ownership
interests in such Person,such Person shall execute a Guarantor Joinder and join
this Agreement as a Guarantor pursuant to Section 11.19 [Joinder of Guarantors]
on or before the date of such Permitted Acquisition;
b. the Loan Parties, such Person and its owners, as
applicable, shall comply with Section 11.19 [Joinder of Guarantors] on or before
the date of such Permitted Acquisition;
c. the board of directors or other equivalent
governing body of such Person shall have approved such Permitted Acquisition
and, if the Loan Parties shall use any portion of the Loans to fund such
Permitted Acquisition, the Loan Parties also shall have delivered to the Banks
written evidence of the approval of the board of directors (or equivalent body)
of such Person for such Permitted Acquisition;
d. the business acquired, or the business conducted
by the Person whose ownership interests are being acquired, as applicable, shall
be substantially the same as one or more line or lines of business conducted by
the Loan Parties or otherwise be compliant with Section 8.2.9 [Continuation of
or Change in Business];
e. no Potential Default or Event of Default shall
exist immediately prior to and after giving effect to such Permitted
Acquisition;
f. the Borrower shall demonstrate that it shall be in
compliance with the covenants contained in Sections 8.2.12 and 8.2.13 after
giving effect to such Permitted Acquisition (including in such computation
Indebtedness or other liabilities assumed or incurred in connection with such
Permitted Acquisition but excluding income earned or expenses incurred by the
Person, business or assets to be acquired prior to the date of such Permitted
Acquisition) by delivering at least five (5) Business Days prior to such
Permitted Acquisition a certificate in the form of Exhibit 8.2.5 (the
"Acquisition Compliance Certificate") evidencing such compliance; and
(g) the Loan Parties shall deliver to the Agent at
least five (5) Business Days before such Permitted Acquisition copies of any
agreements entered into or proposed to be entered into by such Loan Parties in
connection with such Permitted Acquisition and shall deliver to the Agent such
other information about such Person or its assets as the Agent or any Bank may
reasonably require.
8.2.6. Dispositions of Assets or Subsidiaries.
Each of the Loan Parties shall not, and shall not permit any
of its Subsidiaries to, sell, convey, assign, lease, abandon or otherwise
transfer or dispose of, voluntarily or involuntarily, any of its properties or
assets, tangible or intangible (including sale, assignment, discount or other
disposition of accounts, contract rights, chattel paper, equipment or general
intangibles with or without recourse or of capital stock, shares of beneficial
interest,
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partnership interests or limited liability company interests of a Subsidiary of
such Loan Party), except:
(i) transactions involving the sale of inventory in
the ordinary course of business;
(ii) any sale, transfer or lease of assets in the
ordinary course of business which are no longer necessary or required in the
conduct of such Loan Party's or such Subsidiary's business;
(iii) any sale, transfer or lease of assets by any
wholly owned Subsidiary of such Loan Party to another Loan Party;
(iv) any sale, transfer or lease of assets in the
ordinary course of business which are replaced by substitute assets acquired or
leased;
(v) the sale by Commercial Realty and Resources Corp.
of real property and improvements known as Monmouth Shores Corporate Office Park
(block 913, lot 35), Wall, New Jersey and a contiguous parcel (block 913, lot
25) to Horizon Blue Cross/Blue Shield of New Jersey pursuant to the lease of
said premises dated December 15, 2002;
(vi) any sale, transfer or lease of assets, other than
those specifically excepted pursuant to clauses (i) through (v) above, provided
that (i) at the time of any disposition, no Event of Default shall exist or
shall result from such disposition, and (ii) the aggregate net book value of all
assets so sold by the Loan Parties and their Subsidiaries shall not exceed in
any fiscal year five (5%) of the consolidated total assets of the Loan Parties
and their Subsidiaries as determined on a consolidated basis in accordance with
GAAP; and
(vii) any sale, transfer or lease of assets of any
Inactive Subsidiary of the Borrower.
8.2.7. Affiliate Transactions.
Except solely with respect to any Permitted Related Business
Opportunities as previously disclosed to the Agent and each of the Banks, each
of the Loan Parties shall not, and shall not permit any of its Subsidiaries to,
enter into or carry out any transaction (including purchasing property or
services from or selling property or services to any Affiliate of any Loan Party
or other Person) unless such transaction is not otherwise prohibited by this
Agreement, is entered into in the ordinary course of business upon fair and
reasonable arm's-length terms and conditions and is in accordance with all
applicable Law.
8.2.8. Subsidiaries, Partnerships and Joint Ventures.
Each of the Loan Parties shall not, and shall not permit any
of its Subsidiaries to, own or create directly or indirectly any Subsidiaries
other than (i) any Subsidiary which is a Regulated Entity, (ii) any Subsidiary
which is an Inactive Subsidiary of the Borrower, (iii) New Jersey Resources
Foundation Inc., a non-profit corporation organized under the laws of
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the State of New Jersey, (iv) any Subsidiary which has joined this Agreement as
Guarantor on the Closing Date, provided, however, that NJR Investment Company, a
New Jersey corporation and NJR Service Corporation, a New Jersey corporation
will each join as a Guarantor within thirty (30) days of the Closing Date, and
(v) any Subsidiary formed after the Closing Date which joins this Agreement as a
Guarantor pursuant to Section 11.19 [Joinder of Guarantors]. Each of the Loan
Parties shall not become or agree to (1) become a general or limited partner in
any general or limited partnership, except that the Loan Parties may be general
or limited partners in other Loan Parties and except that the Loan Parties or
their Subsidiaries may be a limited partner in a Permitted Related Business
Opportunity, (2) become a member or manager of, or hold a limited liability
company interest in, a limited liability company, except that the Loan Parties
may be members or managers of, or hold limited liability company interests in,
other Loan Parties and except that the Loan Parties or their Subsidiaries may be
members or managers of, or hold limited liability company interests in a
Permitted Related Business Opportunity, or (3) become a joint venturer or hold a
joint venture interest in any joint venture, except that the Loan Parties or
their Subsidiaries may become a joint venturer in or hold a joint venture
interest in any joint venture that is a Permitted Related Business Opportunity.
8.2.9. Continuation of or Change in Business.
Each of the Loan Parties shall not, and shall not permit any
of its Subsidiaries to, engage in any business other than the business of each
Loan Party or Subsidiary substantially as conducted and operated by such Loan
Party or Subsidiary during the present fiscal year, and any line of business or
business activity related or complementary to the business of the Loan Parties
conducted as of the Closing Date.
8.2.10. Plans and Benefit Arrangements.
Each of the Loan Parties shall not, and shall not permit any
of its Subsidiaries to, engage in a Prohibited Transaction with any Plan,
Benefit Arrangement or Multiemployer Plan which, alone or in conjunction with
any other circumstances or set of circumstances resulting in liability under
ERISA or otherwise violate ERISA.
8.2.11. Fiscal Year.
The Borrower shall not, and shall not permit any Subsidiary of
the Borrower to, change its fiscal year from the twelve-month period beginning
October 1 and ending September 30.
8.2.12. Maximum Leverage Ratio.
The Loan Parties shall not at any time permit the ratio of
Consolidated Total Indebtedness of the Borrower and its Subsidiaries to
Consolidated Total Capitalization to exceed 0.65 to 1.00.
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8.2.13. Minimum Interest Coverage Ratio.
The Loan Parties shall not permit the ratio of Consolidated
Income from Operations to Consolidated Interest Expense of the Borrower and its
Subsidiaries, calculated as of the end of each fiscal quarter for the four
fiscal quarters then ended, to be less than 2.50 to 1.00.
8.2.14. No Limitation on Dividends and Distributions by
Subsidiaries.
The Loan Parties shall not, and shall not permit any
Subsidiary (including, without limitation, New Jersey Natural Gas) to, enter
into or otherwise be bound by any agreement not to pay dividends or make
distributions to the Borrower, except for the restrictions that are no more
onerous than the restrictions set forth in this Agreement and the restrictions
set forth in the Mortgage Indenture, in each case as such restrictions exist as
of the Closing Date.
8.2.15. Payment of Dividends; Redemptions.
The Loan Parties shall not, and shall not permit any
Subsidiary to, declare or make any dividend payment or other distribution of
assets, properties, cash, rights, obligations or securities on account of any
shares of any class of capital stock of any Loan Party, or purchase, redeem or
otherwise acquire for value (or permit any of its Subsidiaries to do so) any
shares of any class of capital stock or other securities of any Loan Party or
any warrants, rights or options to acquire any such shares or other securities,
now or hereafter outstanding, except that the Borrower may (a) declare and make
any dividend payment or other distribution payable in common stock of the
Borrower, (b) purchase, redeem or otherwise acquire shares of its common stock
or warrants, rights or options to acquire any such shares so long as no Event of
Default or Potential Default shall have occurred and is continuing or would
result therefrom, and (c) declare and make its quarterly dividend, so long as,
after giving effect thereto, no Event of Default shall have occurred and is
continuing.
8.2.16. No Modification of Hedging Contract Policies.
Each Loan Party and each Subsidiary of each Loan Party shall
not amend, modify, supplement, restate or rescind the Hedging Contract Policies
in a manner which, compared with past practice of the Loan Parties and their
Subsidiaries, would render Hedging Transactions entered into pursuant to the
Hedging Contract Policies (as so modified) materially more speculative (it being
understood that such policies are applicable to each Loan Party and each
Subsidiary of each Loan Party as if such policies were the stated policies of
each Loan Party and each Subsidiary of each Loan Party), without the prior
written consent of the Required Banks.
8.2.17. Off-Balance Sheet Financing.
Each Loan Party and each Subsidiary of each Loan Party shall
not engage in any off-balance sheet transaction (i.e., the liabilities in
respect of which do not appear on the liability side of the balance sheet, with
such balance sheet prepared in accordance with
68
GAAP) providing the functional equivalent of borrowed money (including asset
securitizations, sale/leasebacks or Synthetic Leases (other than any
sale/leaseback transaction or Synthetic Lease entered into, in either case, with
respect to meter assets and which transaction is otherwise permitted by this
Agreement)) with liabilities in excess, in the aggregate for the Borrower and
its Subsidiaries as of any date of determination, of five (5%) of the total
assets of the Borrower and its Subsidiaries, determined and consolidated in
accordance with GAAP as of the date of determination. For purposes of this
Section 8.2.17 (a) "Synthetic Lease" shall mean any lease transaction under
which the parties intend that (i) the lease will be treated as an "operating
lease" by the lessee pursuant to Statement of Financial Accounting Standards No.
13, as amended, or appropriate successor thereto, and (ii) the lessee will be
entitled to various tax benefits ordinarily available to owners (as opposed to
lessees) of like property and (b) the amount of any lease which is not a capital
lease in accordance with GAAP is the aggregate amount of minimum lease payments
due pursuant to such lease for any non-cancelable portion of its term.
8.2.18. Amendments to NJR Note Agreement and NJNG Note Agreement.
8.2.18.1 NJR Note Agreement.
Each Loan Party and each Subsidiary of each Loan Party shall not
enter into any one or more amendments, modifications, restatements, or the like
of the NJR Note Agreement containing covenants or events of default materially
more restrictive than the covenants or Events of Default contained in this
Agreement (a " Modification Agreement") unless no later than five (5) Business
Days after entering into any such Modification Agreement, Borrower shall have
irrevocably offered the Agent and the Banks to enter at any time into an
amendment of this Agreement to add to this Agreement substantially similar
covenants or Events of Default, as the case may be.
The foregoing shall not be construed as: (i) a consent by the Agent or any Bank
to any action or inaction otherwise restricted or prohibited by this Agreement,
or (ii) a waiver by the Agent or any Bank of any Potential Default or Event of
Default resulting from any Modification Agreement.
8.2.18.2 NJNG Note Agreement.
Each Loan Party and each Subsidiary of each Loan Party shall not
enter into any one or more amendments, modifications, restatements, or the like
of the NJNG Note Agreement containing (i) covenants or events of default
materially more restrictive than the covenants or Events of Default contained in
this Agreement (an "NJNG Modification Agreement") or (ii) covenants or events of
default materially more restrictive than the covenants or events of default
contained in the NJNG Credit Agreement (also an "NJNG Modification Agreement")
unless no later than five (5) Business Days after entering into any such NJNG
Modification Agreement, Borrower shall have irrevocably offered the Agent and
the Banks to enter at any time into an amendment of this Agreement or the NJNG
Credit Agreement, as the case may be, to add hereto or thereto substantially
similar covenants or Events of Default, as the case may be.
69
The foregoing shall not be construed as: (i) a consent by the Agent or any Bank
to any action or inaction otherwise restricted or prohibited by this Agreement
or the NJNG Credit Agreement, or (ii) a waiver by the Agent or any Bank of any
Potential Default or Event of Default resulting from any NJNG Modification
Agreement.
8.2.19. No Violation of Anti-Terrorism Laws.
The Loan Parties and each Subsidiary of any Loan Party shall
not: (i) violate any of the prohibitions set forth in the Executive Order No.
13224, the USA Patriot Act or any other Anti-Terrorism Law applicable to any of
them or the business that they conduct, and (ii) require the Agent or the Banks
to take any action that would cause the Agent or the Banks to be in violation of
the prohibitions set forth in the Executive Order No. 13224, the USA Patriot Act
or any other Anti-Terrorism Law, it being understood that the Agent or any Bank
can refuse to honor any such request or demand otherwise validly made by any
such Loan Party or any Subsidiary of any Loan Party under this Agreement or any
other Loan Document.
8.3 Reporting Requirements.
The Loan Parties, jointly and severally, covenant and agree that until
payment in full of the Loans, Reimbursement Obligations and Letter of Credit
Borrowings, and interest thereon, expiration or termination of all Letters of
Credit, satisfaction of all of the Loan Parties' other Obligations hereunder and
under the other Loan Documents and termination of the Commitments, the Loan
Parties will furnish or cause to be furnished to the Agent and each of the
Banks:
8.3.1. Quarterly Financial Statements.
As soon as available and in any event within forty-five (45)
calendar days after the end of each of the first three fiscal quarters in each
fiscal year (or such earlier or later date, from time to time established by the
SEC in accordance with the Securities Exchange Act of 1934, as amended),
financial statements of the Borrower, consisting of a consolidated and
consolidating balance sheet as of the end of such fiscal quarter and related
consolidated and consolidating statements of income, stockholders' equity and
cash flows for the fiscal quarter then ended and the fiscal year through that
date, all in reasonable detail and certified (subject to normal year-end audit
adjustments) by the Chief Executive Officer, President or Chief Financial
Officer of the Borrower as having been prepared in accordance with GAAP,
consistently applied, and setting forth in comparative form the respective
financial statements for the corresponding date and period in the previous
fiscal year. The Loan Parties will be deemed to have complied with the delivery
requirements of this Section 8.3.1 if within forty-five (45) days after the end
of their fiscal quarter (or such earlier or later date, from time to time
established by the SEC in accordance with the Securities Exchange Act of 1934,
as amended), the Borrower delivers to the Agent and each of the Banks a copy of
its Form 10-Q as filed with the SEC and the financial statements contained
therein meets the requirements described in this Section.
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8.3.2. Annual Financial Statements.
As soon as available and in any event within ninety (90) days
after the end of each fiscal year of the Borrower (or such earlier or later
date, from time to time established by the SEC in accordance with the Securities
Exchange Act of 1934, as amended), financial statements of the Borrower
consisting of a consolidated balance sheet as of the end of such fiscal year,
and related consolidated statements of income, stockholders' equity and cash
flows for the fiscal year then ended, all in reasonable detail and setting forth
in comparative form the financial statements as of the end of and for the
preceding fiscal year, and certified by independent certified public accountants
of nationally recognized standing satisfactory to the Agent. The certificate or
report of accountants shall be free of qualifications (other than any
consistency qualification that may result from a change in the method used to
prepare the financial statements as to which such accountants concur) and shall
not indicate the occurrence or existence of any event, condition or contingency
which would materially impair the prospect of payment or performance of any
covenant, agreement or duty of any Loan Party under any of the Loan Documents.
The Loan Parties will be deemed to have complied with the delivery requirements
of this Section 8.3.2 if within ninety (90) days after the end of their fiscal
year (or such earlier or later date, from time to time established by the SEC in
accordance with the Securities Exchange Act of 1934, as amended), the Borrower
delivers to the Agent and each of the Banks a copy of its Annual Report and Form
10-K as filed with the SEC and the financial statements and certification of
public accountants contained therein meets the requirements described in this
Section.
It is expressly agreed that any financial information or
financial statements (including, without limitation the annual financial
statements required pursuant to this Section 8.3.2) submitted to the Agent or
the Banks which has been prepared by an independent public accountant or other
outside accountant shall be accompanied by a statement in writing signed by such
accountant disclosing that the accountant is aware that the financial
information or financial statements prepared by the accountant would be
submitted to and relied upon by the Agent and/or the Banks in connection with
the Agent's or the Banks' determination to grant or continue credit.
8.3.3. Certificate of the Borrower.
Concurrently with the financial statements of the Borrower
furnished to the Agent and to the Banks pursuant to Sections 8.3.1 [Quarterly
Financial Statements] and 8.3.2 [Annual Financial Statements], a certificate
(each a "Compliance Certificate") of the Borrower signed by the Chief Executive
Officer, President or Chief Financial Officer of the Borrower, in the form of
Exhibit 8.3.3.
8.3.4. Notice of Default.
Promptly after any Authorized Officer (or other executive
officer) of any Loan Party has learned of the occurrence of an Event of Default
or Potential Default, a certificate signed by the Chief Executive Officer,
President or Chief Financial Officer of such
71
Loan Party setting forth the details of such Event of Default or Potential
Default and the action which the such Loan Party proposes to take with respect
thereto.
8.3.5. Notice of Litigation.
Promptly after the commencement thereof, notice of (i) all
actions, suits, proceedings or investigations before or by any Official Body or
any other Person against any Loan Party or Subsidiary of any Loan Party, involve
a claim or series of claims in excess of $10,000,000 or, (ii) any Environmental
Complaint, individually or in the aggregate exceed $10,000,000, and in either
case which if adversely determined could reasonably be expected to result in a
Material Adverse Change.
8.3.6. Notice of Change in Debt Rating.
Within five (5) Business Days after Standard & Poor's or
Moody's announces a change in the Debt Rating of New Jersey Natural Gas, notice
of such change. The Borrower will deliver, together with such notice, a copy of
any written notification which Borrower or New Jersey Natural Gas received from
the applicable rating agency regarding such change of Debt Rating.
8.3.7. Sale of Assets.
At least thirty (30) calendar days prior thereto, notice with
respect to any proposed sale or transfer of assets pursuant to Section 8.2.6(vi)
where the consideration for such sale or transfer of assets is in excess of
$5,000,000.
8.3.8. Budgets, Forecasts, Other Reports and Information.
Promptly upon their becoming available to the Borrower:
(i) any reports, notices or proxy statements generally
distributed by the Borrower to its stockholders on a date no
later than the date supplied to such stockholders,
(ii) regular or periodic reports, including Forms 10-K, 10-Q
and 8-K, registration statements and prospectuses, filed by
the Borrower with the SEC,
(iii) to the extent not previously reported in regular or
periodic reports, including Forms 10-K, 10-Q and 8-K,
registration statements and prospectuses, filed by the
Borrower with the SEC, the Borrower shall notify the Banks
promptly of the enactment or adoption of any Law which may
result in a Material Adverse Change,
72
(iv) to the extent requested by the Agent or any Bank, the
annual budget and any forecasts or projections of the Loan
Parties, and
(v) with respect to the Hedging Transaction activities of
the Loan Parties and their Subsidiaries, to the extent not
previously reported in regular or periodic reports, including
Forms 10-K, 10-Q and 8-K, registration statements and
prospectuses, filed by the Borrower with the SEC, such other
reports and information as any of the Banks may from time to
time reasonably request.
8.3.9. Notices Regarding Plans and Benefit Arrangements.
8.3.9.1 Certain Events.
Promptly upon becoming aware of the occurrence thereof,
notice (including the nature of the event and, when known, any action taken or
threatened by the Internal Revenue Service or the PBGC with respect thereto) of:
(i) any Reportable Event with respect to the Borrower or any
other member of the ERISA Group (regardless of whether the
obligation to report said Reportable Event to the PBGC has
been waived),
(ii) any Prohibited Transaction which could subject the
Borrower or any other member of the ERISA Group to a civil
penalty assessed pursuant to Section 502(i) of ERISA or a tax
imposed by Section 4975 of the Internal Revenue Code in
connection with any Plan, any Benefit Arrangement or any trust
created thereunder,
(iii) any assertion of material withdrawal liability with
respect to any Multiemployer Plan,
(iv) any partial or complete withdrawal from a Multiemployer
Plan by the Borrower or any other member of the ERISA Group
under Title IV of ERISA (or assertion thereof), where such
withdrawal is likely to result in material withdrawal
liability,
(v) any cessation of operations (by the Borrower or any
other member of the ERISA Group) at a facility in the
circumstances described in Section 4062(e) of ERISA,
(vi) withdrawal by the Borrower or any other member of the
ERISA Group from a Multiple Employer Plan,
73
(vii) a failure by the Borrower or any other member of the
ERISA Group to make a payment to a Plan required to avoid
imposition of a Lien under Section 302(f) of ERISA,
(viii) the adoption of an amendment to a Plan requiring the
provision of security to such Plan pursuant to Section 307 of
ERISA, or
(ix) any change in the actuarial assumptions or funding
methods used for any Plan, where the effect of such change is
to materially increase or materially reduce the unfunded
benefit liability or obligation to make periodic
contributions.
8.3.9.2 Notices of Involuntary Termination and Annual Reports.
Promptly after receipt thereof, copies of (a) all
notices received by the Borrower or any other member of the ERISA Group of the
PBGC's intent to terminate any Plan administered or maintained by the Borrower
or any member of the ERISA Group, or to have a trustee appointed to administer
any such Plan; and (b) at the request of the Agent or any Bank each annual
report (IRS Form 5500 series) and all accompanying schedules, the most recent
actuarial reports, the most recent financial information concerning the
financial status of each Plan administered or maintained by the Borrower or any
other member of the ERISA Group, and schedules showing the amounts contributed
to each such Plan by or on behalf of the Borrower or any other member of the
ERISA Group in which any of their personnel participate or from which such
personnel may derive a benefit, and each Schedule B (Actuarial Information) to
the annual report filed by the Borrower or any other member of the ERISA Group
with the Internal Revenue Service with respect to each such Plan.
8.3.9.3 Notice of Voluntary Termination.
Promptly upon the filing thereof, copies of any Form
5310, or any successor or equivalent form to Form 5310, filed with the PBGC in
connection with the termination of any Plan.
9. DEFAULT
9.1 Events of Default.
An Event of Default shall mean the occurrence or existence of any one or
more of the following events or conditions (whatever the reason therefor and
whether voluntary, involuntary or effected by operation of Law):
9.1.1. Payments Under Loan Documents.
The Borrower shall fail to pay (i) any principal of any Loan
(including scheduled installments, mandatory prepayments or the payment due at
maturity),
74
Reimbursement Obligation or Letter of Credit Borrowing when such principal is
due hereunder or (ii) any interest on any Loan, Facility Fee, Reimbursement
Obligation or Letter of Credit Borrowing or any other amount owing hereunder or
under the other Loan Documents within three (3) Business Days after such
interest, fee, or other amount becomes due in accordance with the terms hereof
or thereof;
9.1.2. Breach of Warranty.
Any representation or warranty made at any time by any of the
Loan Parties herein or by any of the Loan Parties in any other Loan Document, or
in any certificate, other instrument or statement furnished pursuant to the
provisions hereof or thereof, shall prove to have been false or misleading in
any material respect as of the time it was made or furnished;
9.1.3. Breach of Negative Covenants or Visitation Rights.
Any of the Loan Parties shall default in the observance or
performance of any covenant contained in Section 8.1.6 [Visitation Rights] or
Section 8.2 [Negative Covenants];
9.1.4. Breach of Other Covenants.
Any of the Loan Parties shall default in the observance or
performance of any other covenant, condition or provision hereof or of any other
Loan Document and such default shall continue unremedied for a period of thirty
(30) Days after any Authorized Officer (or other executive officer) of any Loan
Party becomes aware of the occurrence thereof (such grace period to be
applicable only in the event such default can be remedied by corrective action
of the Loan Parties as determined by the Agent in its reasonable discretion);
9.1.5. Defaults in Other Agreements or Indebtedness.
(i) A default or event of default shall occur at any time
under the terms of any other agreement involving borrowed
money or the extension of credit or any other Indebtedness
under which any Loan Party or Subsidiary of any Loan Party may
be obligated as a borrower or guarantor in excess of
$10,000,000 in the aggregate, and such breach, default or
event of default consists of the failure to pay (beyond any
period of grace permitted with respect thereto, whether waived
or not) any indebtedness when due (whether at stated maturity,
by acceleration or otherwise) or if such breach or default
permits or causes the acceleration of any indebtedness
(whether or not such right shall have been waived) or the
termination of any commitment to lend;
(ii) There shall occur under the NJNG Credit Agreement an
"Event of Default" (as such term is defined in the NJNG Credit
Agreement);
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(iii) A default or event of default shall occur at any time
under the terms of any agreement involving any off balance
sheet transaction (including any asset securitization,
sale/leaseback transaction, or Synthetic Lease) with
obligations in the aggregate thereunder for which any Loan
Party or Subsidiary of any Loan Party may be obligated in
excess of $10,000,000, and such breach, default or event of
default consists of the failure to pay (beyond any period of
grace permitted with respect thereto, whether waived or not)
any obligation when due (whether at stated maturity, by
acceleration or otherwise) or if such breach or default
permits or causes the acceleration of any obligation (whether
or not such right shall have been waived) or the termination
of any such agreement;
9.1.6. Final Judgments or Orders.
Any final judgments or orders for the payment of money in
excess of $10,000,000 in the aggregate, to the extent not covered by insurance,
shall be entered against any Loan Party by a court having jurisdiction in the
premises, which judgment is not discharged, vacated, bonded or stayed pending
appeal within a period of thirty (30) days from the date of entry;
9.1.7. Loan Document Unenforceable.
Any of the Loan Documents shall cease to be legal, valid and
binding agreements enforceable against the party executing the same or such
party's successors and assigns (as permitted under the Loan Documents) in
accordance with the respective terms thereof or shall in any way be terminated
(except in accordance with its terms) or become or be declared ineffective or
inoperative or shall in any way be challenged or contested or cease to give or
provide the respective rights, titles, interests, remedies, powers or privileges
intended to be created thereby;
9.1.8. Uninsured Losses; Proceedings Against Assets.
The assets of any Loan Party or the assets of any Subsidiary
of any Loan Party are attached, seized, levied upon or subjected to a writ or
distress warrant; or such come within the possession of any receiver, trustee,
custodian or assignee for the benefit of creditors and the same is not cured
within thirty (30) days thereafter or otherwise fully bonded or covered by
insurance (subject to reasonable and customary deductible amounts);
9.1.9. Notice of Lien or Assessment.
A notice of Lien or assessment in excess of $10,000,000 which
is not a Permitted Lien or Environmental Complaint in excess of $10,000,000 is
filed of record with respect to all or any part of any of the Loan Parties' or
any of their Subsidiaries' assets by the United States, or any department,
agency or instrumentality thereof, or by any state, county, municipal or other
governmental agency, including the PBGC, or any taxes or debts owing at any
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time or times hereafter to any one of these becomes payable and the same is not
paid within thirty (30) days after the same becomes payable;
9.1.10. Insolvency.
Any Loan Party or any Significant Subsidiary of a Loan Party
ceases to be Solvent or admits in writing to a creditor or Official Body its
inability to pay its debts as they mature;
9.1.11. Events Relating to Plans and Benefit Arrangements.
Any of the following occurs: (i) any Reportable Event, which
the Agent determines in good faith constitutes grounds for the termination of
any Plan by the PBGC or the appointment of a trustee to administer or liquidate
any Plan, shall have occurred and be continuing; (ii) proceedings shall have
been instituted or other action taken to terminate any Plan, or a termination
notice shall have been filed with respect to any Plan; (iii) a trustee shall be
appointed to administer or liquidate any Plan; (iv) the PBGC shall give notice
of its intent to institute proceedings to terminate any Plan or Plans or to
appoint a trustee to administer or liquidate any Plan; and, in the case of the
occurrence of (i), (ii), (iii) or (iv) above, the Agent determines in good faith
that the amount of the Borrower's liability is likely to exceed 10% of its
consolidated tangible net worth; (v) the Borrower or any member of the ERISA
Group shall fail to make any contributions when due to a Plan or a Multiemployer
Plan; (vi) the Borrower or any other member of the ERISA Group shall make any
amendment to a Plan with respect to which security is required under Section 307
of ERISA; (vii) the Borrower or any other member of the ERISA Group shall
withdraw completely or partially from a Multiemployer Plan; (viii) the Borrower
or any other member of the ERISA Group shall withdraw (or shall be deemed under
Section 4062(e) of ERISA to withdraw) from a Multiple Employer Plan; or (ix) any
applicable Law is adopted, changed or interpreted by any Official Body with
respect to or otherwise affecting one or more Plans, Multiemployer Plans or
Benefit Arrangements and, with respect to any of the events specified in (v),
(vi), (vii), (viii) or (ix), the Agent determines in good faith that any such
occurrence would be reasonably likely to materially and adversely affect the
total enterprise represented by the Borrower and the other members of the ERISA
Group;
9.1.12. Cessation of Business.
Any Loan Party or Subsidiary of a Loan Party ceases to conduct
its business as contemplated, except as expressly permitted under Section 8.2.5
[Liquidations, Mergers, Etc.], Section 8.2.6 [Disposition of Assets or
Subsidiaries] or Section 8.2.9 [Continuation of or Change of Business] or any
Loan Party or Subsidiary of a Loan Party is enjoined, restrained or in any way
prevented by court order from conducting all or any material part of its
business and such injunction, restraint or other preventive order is not
dismissed within thirty (30) days after the entry thereof;
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9.1.13. Change of Control.
(i) Any person or group of persons (within the meaning of
Sections 13(d) or 14(a) of the Securities Exchange Act of
1934, as amended) shall have acquired beneficial ownership of
(within the meaning of Rule 13d-3 promulgated by the SEC under
said Act) 25% or more of the voting capital stock of the
Borrower (provided that, for purposes of calculating the
acquisition of beneficial ownership, any transfer of voting
stock of the Borrower by any Person or group of Persons to a
Permitted Transferee shall be deemed not to constitute a
conveyance and acquisition of such stock), or (ii) within a
period of twelve (12) consecutive calendar months, individuals
who were directors of the Borrower on the first day of such
period shall cease to constitute a majority of the board of
directors of the Borrower unless the individuals who were
elected or appointed directors during such twelve (12) month
period were elected or appointed by a majority of the
individuals who were directors of the Borrower on the first
day of such period or by their duly appointed or elected
successors; or (iii) Borrower shall cease to own 100% of the
issued and outstanding equity interests of New Jersey Natural
Gas; or (iv) Borrower shall cease to own 51% of the issued and
outstanding interest in any other Loan Party;
9.1.14. Involuntary Proceedings.
A proceeding shall have been instituted in a court having
jurisdiction in the premises seeking a decree or order for relief in respect of
any Loan Party or Subsidiary of a Loan Party in an involuntary case under any
applicable bankruptcy, insolvency, reorganization or other similar law now or
hereafter in effect, or for the appointment of a receiver, liquidator, assignee,
custodian, trustee, sequestrator, conservator (or similar official) of any Loan
Party or Subsidiary of a Loan Party for any substantial part of its property, or
for the winding-up or liquidation of its affairs, and such proceeding shall
remain undismissed or unstayed and in effect for a period of sixty (60)
consecutive days or such court shall enter a decree or order granting any of the
relief sought in such proceeding; or
9.1.15. Voluntary Proceedings.
Any Loan Party or Subsidiary of a Loan Party shall commence a
voluntary case under any applicable bankruptcy, insolvency, reorganization or
other similar law now or hereafter in effect, shall consent to the entry of an
order for relief in an involuntary case under any such law, or shall consent to
the appointment or taking possession by a receiver, liquidator, assignee,
custodian, trustee, sequestrator, conservator (or other similar official) of
itself or for any substantial part of its property or shall make a general
assignment for the benefit of creditors, or shall fail generally to pay its
debts as they become due, or shall take any action in furtherance of any of the
foregoing.
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9.2 Consequences of Event of Default.
9.2.1. Events of Default Other Than Bankruptcy, Insolvency or
Reorganization Proceedings.
If an Event of Default specified under Sections 9.1.1 through
9.1.13 shall occur and be continuing, the Banks and the Agent shall be under no
further obligation to make Loans or issue Letters of Credit, as the case may be,
and the Agent may, and upon the request of the Required Banks shall, by written
notice to the Borrower, take one or both of the following actions: (i) terminate
the Commitments and thereupon the Commitments shall be terminated and of no
further force and effect, or (ii) declare the unpaid principal amount of the
Notes and Loans then outstanding and all interest accrued thereon, any unpaid
fees and all other Indebtedness of the Borrower to the Banks hereunder and
thereunder to be forthwith due and payable, and the same shall thereupon become
and be immediately due and payable to the Agent for the benefit of each Bank
without presentment, demand, protest or any other notice of any kind, all of
which are hereby expressly waived, and (iii) require the Borrower to, and the
Borrower shall thereupon, deposit in a non-interest-bearing account with the
Agent, as cash collateral for its Obligations under the Loan Documents, an
amount equal to the maximum amount currently or at any time thereafter available
to be drawn on all outstanding Letters of Credit, and the Borrower hereby
pledges to the Agent and the Banks, and grants to the Agent and the Banks a
security interest in, all such cash as security for such Obligations. Upon the
curing of all existing Events of Default to the satisfaction of the Required
Banks, the Agent shall return such cash collateral to the Borrower; and
9.2.2. Bankruptcy, Insolvency or Reorganization Proceedings.
If an Event of Default specified under Section 9.1.14
[Involuntary Proceedings] or 9.1.15 [Voluntary Proceedings] shall occur, the
Commitments shall automatically terminate and be of no further force and effect,
the Agent and the Banks shall be under no further obligations to make Loans or
issue Letters of Credit, as the case may be, and the unpaid principal amount of
the Loans then outstanding and all interest accrued thereon, any unpaid fees and
all other Indebtedness of the Borrower to the Banks hereunder and thereunder
shall be immediately due and payable, without presentment, demand, protest or
notice of any kind, all of which are hereby expressly waived; and
9.2.3. Set-off.
If an Event of Default shall occur and be continuing, any Bank
to whom any Obligation is owed by any Loan Party hereunder or under any other
Loan Document or any participant of such Bank which has agreed in writing to be
bound by the provisions of Section 10.13 [Equalization of Banks] and any branch,
Subsidiary or Affiliate of such Bank or participant anywhere in the world shall
have the right, in addition to all other rights and remedies available to it,
without notice to such Loan Party, to set-off against and apply to the then
unpaid balance of all the Loans and all other Obligations of the Borrower and
the other Loan Parties hereunder or under any other Loan Document any debt owing
to, and any other funds held in any manner for the account of, the Borrower or
such other Loan Party by such Bank or participant or
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by such branch, Subsidiary or Affiliate, including all funds in all deposit
accounts (whether time or demand, general or special, provisionally credited or
finally credited, or otherwise) now or hereafter maintained by the Borrower or
such other Loan Party for its own account (but not including funds held in
custodian or trust accounts) with such Bank or participant or such branch,
Subsidiary or Affiliate. Such right shall exist whether or not any Bank or the
Agent shall have made any demand under this Agreement or any other Loan
Document, whether or not such debt owing to or funds held for the account of the
Borrower or such other Loan Party is or are matured or unmatured and regardless
of the existence or adequacy of any Guaranty or any other security, right or
remedy available to any Bank or the Agent; and
9.2.4. Suits, Actions, Proceedings.
If an Event of Default shall occur and be continuing, and
whether or not the Agent shall have accelerated the maturity of Loans pursuant
to any of the foregoing provisions of this Section 9.2, the Agent or any Bank,
if owed any amount with respect to the Loans, may proceed to protect and enforce
its rights by suit in equity, action at law and/or other appropriate proceeding,
whether for the specific performance of any covenant or agreement contained in
this Agreement or the other Loan Documents; and
9.2.5. Application of Proceeds; Collateral Sharing.
9.2.5.1 Application of Proceeds.
From and after the date on which the Agent has taken any
action pursuant to this Section 9.2 and until all Obligations of the Loan
Parties have been paid in full, any and all proceeds received by the Agent from
the exercise of any remedy by the Agent, shall be applied as follows:
(i) first, to reimburse the Agent and the Banks for
out-of-pocket costs, expenses and disbursements, including
reasonable attorneys' and paralegals' fees and legal expenses,
incurred by the Agent or the Banks in connection with
collection of any Obligations of any of the Loan Parties under
any of the Loan Documents;
(ii) second, to the repayment of all Indebtedness then due and
unpaid of the Loan Parties to the Banks incurred under this
Agreement or any of the other Loan Documents, whether of
principal, interest, fees, expenses or otherwise, in such
manner as the Agent may determine in its discretion; and
(iii) the balance, if any, as required by Law.
9.2.5.2 Collateral Sharing.
All Liens granted under each Loan Document (the "Collateral
Documents") shall secure ratably and on a pari passu basis (i) the Obligations
in favor of the
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Agent and the Banks hereunder and (ii) the Obligations incurred by any of the
Loan Parties in favor of any Bank which provides a Bank Provided Interest Rate
Hedge (the "IRH Provider"). The Agent under the Collateral Documents shall be
deemed to serve as the collateral agent (the "Collateral Agent") for the IRH
Provider and the Banks hereunder, provided that the Collateral Agent shall
comply with the instructions and directions of the Agent (or the Banks under
this Agreement to the extent that this Agreement or any other Loan Documents
empowers the Banks to direct the Agent), as to all matters relating to the
collateral, including the maintenance and disposition thereof. No IRH Provider
(except in its capacity as a Bank hereunder) shall be entitled or have the power
to direct or instruct the Collateral Agent on any such matters or to control or
direct in any manner the maintenance or disposition of the collateral.
9.2.6. Other Rights and Remedies.
In addition to all of the rights and remedies contained in
this Agreement or in any of the other Loan Documents, the Agent shall have all
of the rights and remedies under applicable Law, all of which rights and
remedies shall be cumulative and non-exclusive, to the extent permitted by Law.
The Agent may, and upon the request of the Required Banks shall, exercise all
post-default rights granted to the Agent and the Banks under the Loan Documents
or applicable Law.
10. THE AGENT
10.1 Appointment.
Each Bank hereby irrevocably designates, appoints and authorizes PNC Bank
to act as Agent for such Bank under this Agreement and to execute and deliver or
accept on behalf of each of the Banks the other Loan Documents. Each Bank hereby
irrevocably authorizes, the Agent to take such action on its behalf under the
provisions of this Agreement and the other Loan Documents and any other
instruments and agreements referred to herein, and to exercise such powers and
to perform such duties hereunder as are specifically delegated to or required of
the Agent by the terms hereof, together with such powers as are reasonably
incidental thereto. PNC Bank agrees to act as the Agent on behalf of the Banks
to the extent provided in this Agreement.
10.2 Delegation of Duties.
The Agent may perform any of its duties hereunder by or through agents or
employees (provided such delegation does not constitute a relinquishment of its
duties as Agent) and, subject to Sections 10.5 [Reimbursement and
Indemnification of Agent by the Borrower] and Section 10.6 [Exculpatory
Provisions; Limitation of Liability], shall be entitled to engage and pay for
the advice or services of any attorneys, accountants or other experts concerning
all matters pertaining to its duties hereunder and to rely upon any advice so
obtained. It is acknowledged and agreed that each of JPMorgan Chase Bank NA and
Fleet National Bank has received the title of syndication agent under this
Agreement, that each of Bank of Tokyo-Mitsubishi Trust Company and Citicorp
North America, Inc. has received the title of documentation agent under this
Agreement, however such designations are solely to give each of
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JPMorgan Chase Bank NA, Fleet National Bank, Bank of Tokyo-Mitsubishi Trust
Company and Citicorp North America, Inc. its respective title and each of
JPMorgan Chase Bank NA, Fleet National Bank, Bank of Tokyo-Mitsubishi Trust
Company and Citicorp North America, Inc.: (i) has no duties, responsibilities,
functions obligations or liabilities implied or otherwise under the Loan
Documents solely as a result of being so designated as a syndication agent or
documentation agent, respectively, and (ii) is not entitled to any fee solely as
a result of being so designated as a syndication agent or documentation agent,
respectively, other than the fees payable on the Closing Date in accordance with
that certain agreement between the Borrower and the Agent dated as of November
9, 2004.
10.3 Nature of Duties; Independent Credit Investigation.
The Agent shall have no duties or responsibilities except those expressly
set forth in this Agreement and no implied covenants, functions,
responsibilities, duties, obligations, or liabilities shall be read into this
Agreement or otherwise exist. The duties of the Agent shall be mechanical and
administrative in nature; the Agent shall not have by reason of this Agreement a
fiduciary or trust relationship in respect of any Bank; and nothing in this
Agreement, expressed or implied, is intended to or shall be so construed as to
impose upon the Agent any obligations in respect of this Agreement except as
expressly set forth herein. Without limiting the generality of the foregoing,
the use of the term "agent" in this Agreement with reference to the Agent is not
intended to connote any fiduciary or other implied (or express) obligations
arising under agency doctrine of any applicable Law. Instead, such term is used
merely as a matter of market custom, and is intended to create or reflect only
an administrative relationship between independent contracting parties. Each
Bank expressly acknowledges (i) that the Agent has not made any representations
or warranties to it and that no act by the Agent hereafter taken, including any
review of the affairs of any of the Loan Parties, shall be deemed to constitute
any representation or warranty by the Agent to any Bank; (ii) that it has made
and will continue to make, without reliance upon the Agent, its own independent
investigation of the financial condition and affairs and its own appraisal of
the creditworthiness of each of the Loan Parties in connection with this
Agreement and the making and continuance of the Loans hereunder; and (iii)
except as expressly provided herein, that the Agent shall have no duty or
responsibility, either initially or on a continuing basis, to provide any Bank
with any credit or other information with respect thereto, whether coming into
its possession before the making of any Loan or at any time or times thereafter.
10.4 Actions in Discretion of Agent; Instructions From the Banks.
The Agent agrees, upon the written request of the Required Banks, to take
or refrain from taking any action of the type specified as being within the
Agent's rights, powers or discretion herein, provided that the Agent shall not
be required to take any action which exposes the Agent to personal liability or
which is contrary to this Agreement or any other Loan Document or applicable
Law. In the absence of a request by the Required Banks, the Agent shall have
authority, in its sole discretion, to take or not to take any such action,
unless this Agreement specifically requires the consent of the Required Banks or
all of the Banks. Any action taken or failure to act pursuant to such
instructions or discretion shall be binding on the Banks, subject to Section
10.6 [Exculpatory Provisions, Etc.]. Subject to the provisions of Section 10.6,
no Bank
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shall have any right of action whatsoever against the Agent as a result of the
Agent acting or refraining from acting hereunder in accordance with the
instructions of the Required Banks, or in the absence of such instructions, in
the absolute discretion of the Agent.
10.5 Reimbursement and Indemnification of Agent by the Borrower.
The Borrower agrees to pay or reimburse the Agent and hold the Agent
harmless against (a) liability for the payment of all reasonable out-of-pocket
costs, expenses and disbursements, including fees and expenses of counsel
(including the allocated costs of staff counsel), appraisers and environmental
consultants, incurred by the Agent (i) in connection with the negotiation,
preparation, printing, execution, administration, syndication, interpretation
and performance of this Agreement and the other Loan Documents, (ii) relating to
any amendments, waivers or consents pursuant to the provisions hereof, requested
by the Borrower or required by applicable law, (iii) in connection with the
enforcement of this Agreement or any other Loan Document or collection of
amounts due hereunder or thereunder or the proof and allowability of any claim
arising under this Agreement or any other Loan Document, whether in bankruptcy
or receivership proceedings or otherwise, (iv) in any workout or restructuring
or in connection with the protection, preservation, exercise or enforcement of
any of the terms hereof or of any rights hereunder or under any other Loan
Document or in connection with any foreclosure, collection or bankruptcy
proceedings, and (v) in connection with any Environmental Complaint threatened
or asserted against the Agent or the Banks in any way relating to or arising out
of this Agreement or any other Loan Documents (including, without limitation,
the protection, preservation, exercise or enforcement of any of the terms hereof
or of any rights hereunder or under any other Loan Document or in connection
with any foreclosure, collection or bankruptcy proceedings or in any workout or
restructuring) and (b) all liabilities, obligations, losses, damages, penalties,
actions, judgments, suits, costs, expenses or disbursements of any kind or
nature whatsoever which may be imposed on, incurred by or asserted against the
Agent, in its capacity as such, in any way relating to or arising out of (i)
this Agreement or any other Loan Documents or any action taken or omitted by the
Agent hereunder or thereunder, and (ii) any Environmental Complaint in any way
relating to or arising out of this Agreement or any other Loan Documents or any
action taken or omitted by the Agent hereunder or thereunder, provided that the
Borrower shall not be liable for any portion of such liabilities, obligations,
losses, damages, penalties, actions, judgments, suits, costs, expenses or
disbursements if the same results from the Agent's gross negligence or willful
misconduct, or if the Borrower was not given notice of the subject claim and the
opportunity to participate in the defense thereof, at its expense (except that
the Borrower shall remain liable to the extent such failure to give notice does
not result in a loss to the Borrower), or if the same results from a compromise
or settlement agreement entered into without the consent of the Borrower, which
shall not be unreasonably withheld. In addition, the Borrower agrees to
reimburse and pay all reasonable out-of-pocket expenses of the Agent's regular
employees and agents engaged periodically to perform audits of the Loan Parties'
books, records and business properties, subject in all cases to the limitation
set forth in Section 8.1.6 [Visitation Rights].
10.6 Exculpatory Provisions; Limitation of Liability.
Neither the Agent nor any of its directors, officers, employees, agents,
attorneys or Affiliates shall (a) be liable to any Bank for any action taken or
omitted to be taken by it or them
83
hereunder, or in connection herewith including pursuant to any Loan Document,
unless caused by its or their own gross negligence or willful misconduct, (b) be
responsible in any manner to any of the Banks for the effectiveness,
enforceability, genuineness, validity or the due execution of this Agreement or
any other Loan Documents or for any recital, representation, warranty, document,
certificate, report or statement herein or made or furnished under or in
connection with this Agreement or any other Loan Documents, or (c) be under any
obligation to any of the Banks to ascertain or to inquire as to the performance
or observance of any of the terms, covenants or conditions hereof or thereof on
the part of the Loan Parties, or the financial condition of the Loan Parties, or
the existence or possible existence of any Event of Default or Potential
Default. No claim may be made by any of the Loan Parties, any Bank, the Agent or
any of their respective Subsidiaries against the Agent, any Bank or any of their
respective directors, officers, employees, agents, attorneys or Affiliates, or
any of them, for any special, indirect or consequential damages or, to the
fullest extent permitted by Law, for any punitive damages in respect of any
claim or cause of action (whether based on contract, tort, statutory liability,
or any other ground) based on, arising out of or related to any Loan Document or
the transactions contemplated hereby or any act, omission or event occurring in
connection therewith, including the negotiation, documentation, administration
or collection of the Loans, and each of the Loan Parties (for itself and on
behalf of each of its Subsidiaries), the Agent and each Bank hereby waives,
releases and agrees never to sue upon any claim for any such damages, whether
such claim now exists or hereafter arises and whether or not it is now known or
suspected to exist in its favor. Each Bank agrees that, except for notices,
reports and other documents expressly required to be furnished to the Banks by
the Agent hereunder or given to the Agent for the account of or with copies for
the Banks, the Agent and each of its directors, officers, employees, agents,
attorneys or Affiliates shall not have any duty or responsibility to provide any
Bank with any credit or other information concerning the business, operations,
property, condition (financial or otherwise), prospects or creditworthiness of
the Loan Parties which may come into the possession of the Agent or any of its
directors, officers, employees, agents, attorneys or Affiliates.
10.7 Reimbursement and Indemnification of Agent by Banks.
Each Bank agrees to reimburse and indemnify, defend and save the Agent (to
the extent not reimbursed by the Borrower and without limiting the Obligation of
the Borrower to do so) in proportion to its Ratable Share harmless from and
against all liabilities, obligations, losses, damages, penalties, actions,
judgments, suits, costs, expenses or disbursements, including attorneys' fees
and disbursements (including the allocated costs of staff counsel), and costs of
appraisers and environmental consultants, of any kind or nature whatsoever which
may be imposed on, incurred by or asserted against the Agent, in its capacity as
such, in any way relating to or arising out of this Agreement or any other Loan
Documents or any action taken or omitted by the Agent hereunder or thereunder,
provided that no Bank shall be liable for any portion of such liabilities,
obligations, losses, damages, penalties, actions, judgments, suits, costs,
expenses or disbursements (a) if the same results from the Agent's gross
negligence or willful misconduct, or (b) if such Bank was not given notice of
the subject claim and the opportunity to participate in the defense thereof, at
its expense (except that such Bank shall remain liable to the extent such
failure to give notice does not result in a loss to the Bank), or (c) if the
same results from a compromise and settlement agreement entered into without the
consent of such Bank, which
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shall not be unreasonably withheld. In addition, each Bank agrees promptly upon
demand to reimburse the Agent (to the extent not reimbursed by the Borrower and
without limiting the Obligation of the Borrower to do so) in proportion to its
Ratable Share for all amounts due and payable by the Borrower to the Agent in
connection with the Agent's periodic audit of the Loan Parties' books, records
and business properties.
10.8 Reliance by Agent.
The Agent shall be entitled to rely upon any writing, telex or teletype
message, resolution, notice, consent, certificate, letter, statement, order or
other document or conversation by telephone or otherwise believed by it to be
genuine and correct and to have been signed, sent or made by the proper Person
or Persons, and upon the advice and opinions of counsel and other professional
advisers selected by the Agent. The Agent shall be fully justified in failing or
refusing to take any action hereunder unless it shall first be indemnified to
its satisfaction by the Banks against any and all liability and expense which
may be incurred by it by reason of taking or continuing to take any such action.
10.9 Notice of Default.
The Agent shall not be deemed to have knowledge or notice of the
occurrence of any Potential Default or Event of Default unless the Agent has
received written notice from a Bank or the Borrower referring to this Agreement,
describing such Potential Default or Event of Default and stating that such
notice is a "notice of default."
10.10 Notices.
The Agent shall promptly send to each Bank a copy of all notices received
from the Borrower pursuant to the provisions of this Agreement or the other Loan
Documents promptly upon receipt thereof. The Agent shall promptly notify the
Borrower and the other Banks of each change in the Base Rate and the effective
date thereof.
10.11 Banks in Their Individual Capacities; Agents in Its Individual
Capacity.
With respect to its Commitment and the Loans made by it and any other
rights and powers given to it as a Bank hereunder or under any of the other Loan
Documents, the Agent shall have the same rights and powers hereunder as any
other Bank and may exercise the same as though it were not the Agent, and the
term "Bank" and "Banks" shall, unless the context otherwise indicates, include
the Agent in its individual capacity. PNC Bank and its Affiliates and each of
the Banks and their respective Affiliates may, without liability to account,
except as prohibited herein, make loans to, issue letters of credit for the
account of, acquire equity interests in, accept deposits from, discount drafts
for, act as trustee under indentures of, and generally engage in any kind of
banking, trust, financial advisory, underwriting or other business with, the
Loan Parties and their Affiliates, in the case of the Agent, as though it were
not acting as Agent hereunder and in the case of each Bank, as though such Bank
were not a Bank hereunder, in each case without notice to or consent of the
other Banks. The Banks acknowledge that, pursuant to such activities, the Agent
or its Affiliates may (i) receive information regarding the Loan Parties
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or any of their Subsidiaries or Affiliates (including information that may be
subject to confidentiality obligations in favor of the Loan Parties or such
Subsidiary or Affiliate) and acknowledge that the Agent shall be under no
obligation to provide such information to them, and (ii) accept fees and other
consideration from the Loan Parties for services in connection with this
Agreement and otherwise without having to account for the same to the Banks.
10.12 Holders of Notes.
The Agent may deem and treat any payee of any Note as the owner thereof
for all purposes hereof unless and until written notice of the assignment or
transfer thereof shall have been filed with the Agent. 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.
10.13 Equalization of Banks.
The Banks and the holders of any participations in any Commitments or
Loans or other rights or obligations of a Bank hereunder agree among themselves
that, with respect to all amounts received by any Bank or any such holder for
application on any Obligation hereunder or under any such participation, whether
received by voluntary payment, by realization upon security, by the exercise of
the right of set-off or banker's lien, by counterclaim or by any other non-pro
rata source, equitable adjustment will be made in the manner stated in the
following sentence so that, in effect, all such excess amounts will be shared
ratably among the Banks and such holders in proportion to their interests in
payments on the Loans, except as otherwise provided in Section 4.4.3 [Agent's
and Bank's Rights], 5.4.2 [Replacement of a Bank] or 5.6 [Additional
Compensation in Certain Circumstances]. The Banks or any such holder receiving
any such amount shall purchase for cash from each of the other Banks an interest
in such Bank's Loans in such amount as shall result in a ratable participation
by the Banks and each such holder in the aggregate unpaid amount of the Loans,
provided that if all or any portion of such excess amount is thereafter
recovered from the Bank or the holder making such purchase, such purchase shall
be rescinded and the purchase price restored to the extent of such recovery,
together with interest or other amounts, if any, required by law (including
court order) to be paid by the Bank or the holder making such purchase.
10.14 Successor Agent.
The Agent (i) may resign as Agent or (ii) shall resign if such resignation
is requested by the Required Banks (if the Agent is a Bank, the Agent's Loans
and its Commitment shall be considered in determining whether the Required Banks
have requested such resignation) or required by Section 5.4.2 [Replacement of a
Bank], in either case of (i) or (ii) by giving not less than thirty (30) days'
prior written notice to the Borrower. If the Agent shall resign under this
Agreement, then either (a) the Required Banks shall appoint from among the Banks
a successor agent for the Banks, subject to the consent of the Borrower, such
consent not to be unreasonably withheld and such consent not to be required if
an Event of Default exists and is continuing, or (b) if a successor agent shall
not be so appointed and approved within the thirty
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(30) day period following the Agent's notice to the Banks of its resignation,
then the Agent shall appoint, with the consent of the Borrower, such consent not
to be unreasonably withheld, a successor agent who shall serve as Agent until
such time as the Required Banks appoint and the Borrower consents to the
appointment of a successor agent. Upon its appointment pursuant to either clause
(a) or (b) above, such successor agent shall succeed to the rights, powers and
duties of the Agent, and the term "Agent" shall mean such successor agent,
effective upon its appointment, and the former Agent's rights, powers and duties
as Agent shall be terminated without any other or further act or deed on the
part of such former Agent or any of the parties to this Agreement. After the
resignation of any Agent hereunder, the provisions of this Section 10 shall
inure to the benefit of such former Agent and such former Agent shall not by
reason of such resignation be deemed to be released from liability for any
actions taken or not taken by it while it was an Agent under this Agreement.
10.15 Agent's Fee.
The Borrower shall pay to the Agent a nonrefundable fee (the "Agent's
Fee") for Agent's services hereunder under the terms of a letter (the "Agent's
Letter") between the Borrower and Agent dated November 9, 2004.
10.16 Availability of Funds.
The Agent may assume that each Bank has made or will make the proceeds of
a Loan available to the Agent unless the Agent shall have been notified by such
Bank on or before the later of (1) the close of Business on the Business Day
preceding the Borrowing Date with respect to such Loan or two (2) hours before
the time on which the Agent actually funds the proceeds of such Loan to the
Borrower (whether using its own funds pursuant to this Section 10.16 or using
proceeds deposited with the Agent by the Banks and whether such funding occurs
before or after the time on which Banks are required to deposit the proceeds of
such Loan with the Agent). The Agent may, in reliance upon such assumption (but
shall not be required to), make available to the Borrower a corresponding
amount. If such corresponding amount is not in fact made available to the Agent
by such Bank, the Agent shall be entitled to recover such amount on demand from
such Bank (or, if such Bank fails to pay such amount forthwith upon such demand
from the Borrower) together with interest thereon, in respect of each day during
the period commencing on the date such amount was made available to the Borrower
and ending on the date the Agent recovers such amount, at a rate per annum equal
to (i) the Federal Funds Open Rate during the first three (3) days after such
interest shall begin to accrue and (ii) the applicable interest rate in respect
of such Loan after the end of such three-day period.
10.17 Calculations.
In the absence of gross negligence or willful misconduct, the Agent shall
not be liable for any error in computing the amount payable to any Bank whether
in respect of the Loans, fees or any other amounts due to the Banks under this
Agreement. In the event an error in computing any amount payable to any Bank is
made, the Agent, the Borrower and each affected Bank shall, forthwith upon
discovery of such error, make such adjustments as shall be required to
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correct such error, and any compensation therefor will be calculated at the
Federal Funds Open Rate.
10.18 Beneficiaries.
Except as expressly provided herein, the provisions of this Section 10 are
solely for the benefit of the Agent and the Banks, and the Loan Parties shall
not have any rights to rely on or enforce any of the provisions hereof. In
performing its functions and duties under this Agreement, the Agent shall act
solely as agent of the Banks and does not assume and shall not be deemed to have
assumed any obligation toward or relationship of agency or trust with or for any
of the Loan Parties.
10.19 No Reliance on Agent's Customer Identification Program.
Each Bank acknowledges and agrees that neither such Bank, nor any of its
Affiliates, participants or assignees, may rely on the Agent to carry out such
Bank's, Affiliate's, participant's or assignee's customer identification
program, or other obligations required or imposed under or pursuant to the USA
Patriot Act or the regulations thereunder, including the regulations contained
in 31 CFR 103.121 (as hereafter amended or replaced, the "CIP Regulations"), or
any other Anti-Terrorism Law, including any programs involving any of the
following items relating to or in connection with any of the Loan Parties, their
Affiliates or their agents, the Loan Documents or the transactions hereunder or
contemplated hereby: (1) any identity verification procedures, (2) any record
keeping, (3) comparisons with government lists, (4) customer notices or (5)
other procedures required under the CIP Regulations or such other Laws.
11. MISCELLANEOUS
11.1 Modifications, Amendments or Waivers.
With the written consent of the Required Banks, the Agent, acting on
behalf of all the Banks, and the Borrower, on behalf of the Loan Parties, may
from time to time enter into written agreements amending or changing any
provision of this Agreement or any other Loan Document or the rights of the
Banks or the Loan Parties hereunder or thereunder, or may grant written waivers
or consents to a departure from the due performance of the Obligations of the
Loan Parties hereunder or thereunder. Any such agreement, waiver or consent made
with such written consent shall be effective to bind all the Banks and the Loan
Parties; provided, that, no such agreement, waiver or consent may be made which
will:
11.1.1. Increase of Revolving Credit Commitments; Extension of
Expiration Date.
Without the written consent of the Required Banks and all
Banks which have a Revolving Credit Commitment:
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(i) increase the amount of the Revolving Credit Commitment of
any Bank hereunder (other than any increase in the amount of the Revolving
Credit Commitments in accordance with Section 2.11, which increase shall not
require the consent of any Bank, other than each Bank increasing its Revolving
Credit Commitment),
(ii) extend the Expiration Date,
(iii) whether or not any Revolving Credit Loans are
outstanding extend the time for payment of principal or interest of any
Revolving Credit Loan (excluding the due date of any mandatory prepayment of a
Revolving Credit Loan or any mandatory Revolving Credit Commitment reduction in
connection with such a mandatory prepayment hereunder except for mandatory
reductions of the Revolving Credit Commitments on the Expiration Date), the
Facility Fee, or any other fee payable to any Bank which has a Revolving Credit
Commitment, or
(iv) reduce the principal amount of or the rate of interest
borne by any Revolving Credit Loan or reduce the Facility Fee or any other fee
payable to any Bank which has a Revolving Credit Commitment, or otherwise affect
the terms of payment of the principal of or interest of any Revolving Credit
Loan, the Facility Fee, or any other fee payable to any Bank which has a
Revolving Credit Commitment;
11.1.2. Release of Collateral or Guarantor.
Without the written consent of all Banks, release any
Guarantor from its Obligations under the Guaranty Agreement or any other
security for any of the Loan Parties' Obligations; or
11.1.3. Miscellaneous.
Without the written consent of all Banks, amend Section 5.2
[Pro Rata Treatment of Banks], 9.2.5 [Application of Proceeds; Collateral
Sharing], 10.6 [Exculpatory Provisions, Etc.] or 10.13 [Equalization of Banks]
or this Section 11.1, alter any provision regarding the pro rata treatment of
the Banks, change the definition of Required Banks, or change any requirement
providing for the Banks or the Required Banks to authorize the taking of any
action hereunder;
provided, further, that no agreement, waiver or consent which would modify the
interests, rights or obligations of the Agent in its capacity as Agent or as the
issuer of Letters of Credit shall be effective without the written consent of
the Agent, and no agreement, waiver or consent which would modify the interests,
rights or obligations of PNC Bank with respect to its Swing Loan Commitment
shall be effective without the written consent of PNC Bank.
11.2 No Implied Waivers; Cumulative Remedies; Writing Required.
No course of dealing and no delay or failure of the Agent or any Bank in
exercising any right, power, remedy or privilege under this Agreement or any
other Loan Document shall affect any other or future exercise thereof or operate
as a waiver thereof, nor
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shall any single or partial exercise thereof or any abandonment or
discontinuance of steps to enforce such a right, power, remedy or privilege
preclude any further exercise thereof or of any other right, power, remedy or
privilege. The rights and remedies of the Agent and the Banks under this
Agreement and any other Loan Documents are cumulative and not exclusive of any
rights or remedies which they would otherwise have. Any waiver, permit, consent
or approval of any kind or character on the part of any Bank of any breach or
default under this Agreement or any such waiver of any provision or condition of
this Agreement must be in writing and shall be effective only to the extent
specifically set forth in such writing.
11.3 Reimbursement and Indemnification of Banks by the Borrower; Taxes.
The Borrower agrees upon demand to pay or reimburse to each Bank (other
than the Agent, as to which the Borrower's Obligations are set forth in Section
10.5 [Reimbursement and Indemnification of Agent by the Borrower]) and to save
such Bank harmless against (i) liability for the payment of all reasonable
out-of-pocket costs, expenses and disbursements (including fees and expenses of
counsel (including allocated costs of staff counsel) for each Bank except with
respect to (A) and (B) below), incurred by such Bank (a) in connection with the
administration and interpretation of this Agreement, and other instruments and
documents to be delivered hereunder, (b) relating to any amendments, waivers or
consents pursuant to the provisions hereof requested by the Borrower or required
by applicable law, (c) in connection with the enforcement of this Agreement or
any other Loan Document, or collection of amounts due hereunder or thereunder or
the proof and allowability of any claim arising under this Agreement or any
other Loan Document, whether in bankruptcy or receivership proceedings or
otherwise, (d) in any workout or restructuring or in connection with the
protection, preservation, exercise or enforcement of any of the terms hereof or
of any rights hereunder or under any other Loan Document or in connection with
any foreclosure, collection or bankruptcy proceedings, and (e) in connection
with any Environmental Complaint threatened or asserted against such Bank in any
way relating to or arising out of this Agreement or any other Loan Documents
(including, without limitation, the protection, preservation, exercise or
enforcement of any of the terms hereof or of any rights hereunder or under any
other Loan Document or in connection with any foreclosure, collection or
bankruptcy proceedings or in any workout or restructuring), or (ii) all
liabilities, obligations, losses, damages, penalties, actions, judgments, suits,
costs, expenses or disbursements of any kind or nature whatsoever which may be
imposed on, incurred by or asserted against such Bank, in its capacity as such,
in any way relating to or arising out of (y) this Agreement or any other Loan
Documents or any action taken or omitted by such Bank hereunder or thereunder,
and (z) any Environmental Complaint in any way relating to or arising out of
this Agreement or any other Loan Documents or any action taken or omitted by
such Bank hereunder or thereunder, provided that the Borrower shall not be
liable for any portion of such liabilities, obligations, losses, damages,
penalties, actions, judgments, suits, costs, expenses or disbursements (A) if
the same results from such Bank's gross negligence or willful misconduct, or (B)
if the Borrower was not given notice of the subject claim and the opportunity to
participate in the defense thereof, at its expense (except that the Borrower
shall remain liable to the extent such failure to give notice does not result in
a loss to the Borrower), or (C) if the same results from a compromise or
settlement agreement entered into without the consent of the Borrower, which
shall not be unreasonably withheld. The Banks will attempt to minimize the fees
and expenses of legal counsel for the Banks which are subject to reimbursement
by the Borrower
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hereunder by considering the usage of one law firm to represent the Banks and
the Agent if appropriate under the circumstances. The Borrower agrees
unconditionally to pay all stamp, document, transfer, recording or filing taxes
or fees and similar impositions now or hereafter determined by the Agent or any
Bank to be payable in connection with this Agreement or any other Loan Document,
and the Borrower agrees unconditionally to save the Agent and the Banks harmless
from and against any and all present or future claims, liabilities or losses
with respect to or resulting from any omission to pay or delay in paying any
such taxes, fees or impositions.
11.4 Holidays.
Whenever payment of a Loan to be made or taken hereunder shall be due on a
day which is not a Business Day such payment shall be due on the next Business
Day (except as provided in Section 4.2 [Interest Periods] with respect to
Interest Periods under the Euro-Rate Option) and such extension of time shall be
included in computing interest and fees, except that the Revolving Credit Loans
and Swing Loans shall be due on the Business Day preceding the Expiration Date
if the Expiration Date is not a Business Day. Whenever any payment or action to
be made or taken hereunder (other than payment of the Loans) shall be stated to
be due on a day which is not a Business Day, such payment or action shall be
made or taken on the next following Business Day, and such extension of time
shall not be included in computing interest or fees, if any, in connection with
such payment or action.
11.5 Funding by Branch, Subsidiary or Affiliate.
11.5.1. Notional Funding.
Each Bank shall have the right from time to time, without
notice to the Borrower, to deem any branch, Subsidiary or Affiliate (which for
the purposes of this Section 11.5 shall mean any corporation or association
which is directly or indirectly controlled by or is under direct or indirect
common control with any corporation or association which directly or indirectly
controls such Bank) of such Bank to have made, maintained or funded any Loan to
which the Euro-Rate Option applies at any time, provided that immediately
following (on the assumption that a payment were then due from the Borrower to
such other office), and as a result of such change, the Borrower would not be
under any greater financial obligation pursuant to Section 5.6 [Additional
Compensation in Certain Circumstances] or Section 5.8 [Taxes] than it would have
been in the absence of such change. Notional funding offices may be selected by
each Bank without regard to such Bank's actual methods of making, maintaining or
funding the Loans or any sources of funding actually used by or available to
such Bank.
11.5.2. Actual Funding.
Each Bank shall have the right from time to time to make or
maintain any Loan by arranging for a branch, Subsidiary or Affiliate of such
Bank to make or maintain such Loan subject to the last sentence of this Section
11.5.2. If any Bank causes a branch, Subsidiary or Affiliate to make or maintain
any part of the Loans hereunder, all terms and conditions of this Agreement
shall, except where the context clearly requires otherwise, be applicable to
such part of the Loans to the same extent as if such Loans were made or
maintained
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by such Bank, but in no event shall any Bank's use of such a branch, Subsidiary
or Affiliate to make or maintain any part of the Loans hereunder cause such Bank
or such branch, Subsidiary or Affiliate to incur any cost or expenses payable by
the Borrower hereunder or require the Borrower to pay any other compensation to
any Bank (including any expenses incurred or payable pursuant to Section 5.6
[Additional Compensation in Certain Circumstances]) or Section 5.8 [Taxes] which
would otherwise not be incurred.
11.6 Notices; Lending Offices.
Any notice, request, demand, direction or other communication (for
purposes of this Section 11.6 only, a "Notice") to be given to or made upon any
party hereto under any provision of this Agreement shall be given or made by
telephone or in writing (which includes means of electronic transmission (i.e.,
"e-mail") or facsimile transmission or by setting forth such Notice on a
restricted access site on the World Wide Web (a "Website Posting") if Notice of
such Website Posting (including the information necessary to access such site)
has previously been delivered to the applicable parties hereto by another means
set forth in this Section 11.6) in accordance with this Section 11.6. Any such
Notice must be delivered to the applicable parties hereto at the addresses and
numbers set forth under their respective names on Schedule 1.1(B) hereof or in
accordance with any subsequent unrevoked Notice from any such party that is
given in accordance with this Section 11.6. Any Notice shall be effective:
(i) In the case of hand-delivery, when delivered;
(ii) If given by mail, four days after such Notice is
deposited with the United States Postal Service, with
first-class postage prepaid, return receipt requested;
(iii) In the case of a telephonic Notice, when a party is
contacted by telephone, if delivery of such telephonic Notice
is confirmed no later than the next Business Day by hand
delivery, a facsimile or electronic transmission, a Website
Posting or overnight courier delivery of a confirmatory notice
(received at or before noon on such next Business Day);
(iv) In the case of a facsimile transmission, when sent to the
applicable party's facsimile machine's telephone number if the
party sending such Notice receives confirmation of the
delivery thereof from its own facsimile machine;
(v) In the case of electronic transmission, when actually
received;
(vi) In the case of a Website Posting, upon delivery of a
Notice of such posting (including the information necessary to
access such web site) by another means set forth in this
Section 11.6; and
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(vii) If given by any other means (including by overnight
courier), when actually received.
Any Bank giving a Notice to a Loan Party shall concurrently send a copy thereof
to the Agent, and the Agent shall promptly notify the other Banks of its receipt
of such Notice.
11.7 Severability.
The provisions of this Agreement are intended to be severable. If any
provision of this Agreement shall be held invalid or unenforceable in whole or
in part in any jurisdiction, such provision shall, as to such jurisdiction, be
ineffective to the extent of such invalidity or unenforceability without in any
manner affecting the validity or enforceability thereof in any other
jurisdiction or the remaining provisions hereof in any jurisdiction.
11.8 Governing Law.
Each Letter of Credit and Section 2.9 [Letter of Credit Subfacility] shall
be subject to the International Standby Practices 1998 ("ISP98") and any
subsequent official revision thereof, and to the extent not inconsistent
therewith, the internal laws of the State of New Jersey without regard to its
conflict of laws principles, and the balance of this Agreement shall be deemed
to be a contract under the Laws of the State of New Jersey and for all purposes
shall be governed by and construed and enforced in accordance with the internal
laws of the State of New Jersey without regard to its conflict of laws
principles.
11.9 Prior Understanding.
This Agreement and the other Loan Documents supersede all prior
understandings and agreements, whether written or oral, between the parties
hereto and thereto relating to the transactions provided for herein and therein,
including any prior confidentiality agreements and commitments.
11.10 Duration; Survival.
All representations and warranties of the Loan Parties contained herein or
made in connection herewith shall survive the making of Loans and issuance of
Letters of Credit and shall not be waived by the execution and delivery of this
Agreement, any investigation by the Agent or the Banks, the making of Loans,
issuance of Letters of Credit, or payment in full of the Loans. All covenants
and agreements of the Loan Parties contained in Sections 8.1 [Affirmative
Covenants], 8.2 [Negative Covenants] and 8.3 [Reporting Requirements] herein
shall continue in full force and effect from and after the date hereof so long
as the Borrower may borrow or request Letters of Credit hereunder and until
termination of the Commitments and payment in full of the Loans and expiration
or termination of all Letters of Credit. All covenants and agreements of the
Borrower contained herein relating to the payment of principal, interest,
premiums, additional compensation or expenses and indemnification, including
those set forth in Section 5 [Payments] and Sections 10.5 [Reimbursement and
Indemnification of Agent by the Borrower], 10.7 [Reimbursement and
Indemnification of Agent by Banks] and 11.3 [Reimbursement and Indemnification
of Banks by the Borrower], shall survive payment in full of
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the Loans, expiration or termination of the Letters of Credit and termination of
the Commitments.
11.11 Successors and Assigns; Joinder of a Bank.
(i) This Agreement shall be binding upon and shall inure to
the benefit of the Banks, the Agent, the Loan Parties and
their respective successors and assigns, except that none of
the Loan Parties may assign or transfer any of its rights and
Obligations hereunder or any interest herein. Each Bank may,
at its own cost, make assignments of or sell participations in
all or any part of its Commitments and the Loans made by it to
one or more banks or other entities, subject to the consent of
the Borrower and the Agent with respect to any assignee, such
consent not to be unreasonably withheld, provided that (1) no
consent of the Borrower shall be required (A) if an Event of
Default exists and is continuing, or (B) in the case of an
assignment by a Bank to an Affiliate of such Bank or an
Approved Fund of such Bank and (2) any assignment by a Bank to
a Person other than an Affiliate of such Bank may not be made
in amounts less than the lesser of $5,000,000 or the amount of
the assigning Bank's Commitment. In the case of an assignment,
upon receipt by the Agent of the Assignment and Assumption
Agreement, the assignee shall have, to the extent of such
assignment (unless otherwise provided therein), the same
rights, benefits and obligations as it would have if it had
been a signatory Bank hereunder, the Commitments shall be
adjusted accordingly, and upon surrender of any Revolving
Credit Note subject to such assignment, the Borrower shall
execute and deliver a new Revolving Credit Note to the
assignee, if such assignee requests such a Note in an amount
equal to the amount of the Revolving Credit Commitment assumed
by it and a new Revolving Credit Note to the assigning Bank,
if the assigning Bank requests such a Note, in an amount equal
to the Revolving Credit Commitment retained by it hereunder.
Any Bank which assigns any or all of its Commitment or Loans
to a Person other than an Affiliate of such Bank shall pay to
the Agent a service fee in the amount of $3,500 for each
assignment. In the case of a participation, the participant
shall only have the rights specified in Section 9.2.3
[Set-off] (the participant's rights against such Bank in
respect of such participation to be those set forth in the
agreement executed by such Bank in favor of the participant
relating thereto and not to include any voting rights except
with respect to changes of the type referenced in Sections
11.1.1 [Increase of Revolving Credit Commitments; Extension of
Expiration Date] or 11.1.2 [Release of Collateral or
Guarantor]), all of such Bank's obligations under this
Agreement or any other Loan Document
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shall remain unchanged, and all amounts payable by any Loan
Party hereunder or thereunder shall be determined as if such
Bank had not sold such participation.
(ii) Any assignee or participant which is not incorporated
under the Laws of the United States of America or a state
thereof shall deliver to the Borrower and the Agent the form
of certificate described in Section 11.18.1 [Tax Withholding]
relating to federal income tax withholding. Each Bank may
furnish any publicly available information concerning any Loan
Party or its Subsidiaries and any other information concerning
any Loan Party or its Subsidiaries in the possession of such
Bank from time to time to assignees and participants
(including prospective assignees or participants), provided
that such assignees and participants agree to be bound by the
provisions of Section 11.12 [Confidentiality].
(iii) Notwithstanding any other provision in this Agreement,
any Bank may at any time pledge or grant a security interest
in all or any portion of its rights under this Agreement, its
Note (if any) and the other Loan Documents to any Federal
Reserve Bank in accordance with Regulation A of the FRB or
U.S. Treasury Regulation 31 CFR Section 203.14 without notice
to or consent of the Borrower or the Agent. No such pledge or
grant of a security interest shall release the transferor Bank
of its obligations hereunder or under any other Loan Document.
(iv) A bank which is to become a party to this Agreement
pursuant to Section 2.11 hereof or otherwise (each an
"Additional Bank") shall execute and deliver to Agent a Bank
Joinder to this Agreement in substantially the form attached
hereto as Exhibit 1.1(B). Upon execution and delivery of a
Bank Joinder, such Additional Bank shall be a party hereto and
a Bank under each of the Loan Documents for all purposes,
except that such Additional Bank shall not participate in any
Loans to which the Euro-Rate Option applies which are
outstanding on the effective date of such Bank Joinder. If
Borrower should renew after the effective date of such Bank
Joinder the Euro-Rate Option with respect to Loans existing on
such date, Borrower shall be deemed to repay the applicable
Loans on the renewal date and then reborrow a similar amount
on such date so that the Additional Bank shall participate in
such Loans after such renewal date. Schedule 1.1(B) shall be
amended and restated on the date of such Bank Joinder to
revise the information contained therein as appropriate to
reflect the information on the attachment to such Bank
Joinder. Simultaneously with the execution and delivery of
such Bank Joinder, Borrower shall execute a Revolving Credit
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Note, and deliver it to such Additional Bank together with
originals of such other documents described in Section 7.1
hereof as such Additional Bank may reasonably require.
11.12 Confidentiality.
11.12.1. General.
The Agent and the Banks each agree to keep confidential all
information obtained from any Loan Party or its Subsidiaries which is nonpublic
and confidential or proprietary in nature (including any information the
Borrower specifically designates as confidential), except as provided below, and
to use such information only in connection with their respective capacities
under this Agreement and for the purposes contemplated hereby. The Agent and the
Banks shall be permitted to disclose such information (i) to outside legal
counsel, accountants and other professional advisors who need to know such
information in connection with the administration and enforcement of this
Agreement, subject to agreement of such Persons to maintain the confidentiality,
(ii) to assignees and participants as contemplated by Section 11.11, and
prospective assignees and participants, provided that prior to such disclosure,
such parties agree to be bound by this undertaking of confidentiality set forth
in this Section 11.12, (iii) to the extent requested by any bank regulatory
authority or, with notice to the Borrower, as otherwise required by applicable
Law or by any subpoena or similar legal process, or in connection with any
investigation or proceeding arising out of the transactions contemplated by this
Agreement, (iv) if it becomes publicly available other than as a result of a
breach of this Agreement or becomes available and is not reasonably known to be
subject to confidentiality restrictions, or (v) if the Borrower shall have
consented to such disclosure.
11.12.2. Sharing Information With Affiliates of the Banks.
Each Loan Party acknowledges that from time to time financial
advisory, investment banking and other services may be offered or provided to
the Borrower or one or more of its Affiliates (in connection with this Agreement
or otherwise) by any Bank or by one or more Subsidiaries or Affiliates of such
Bank and each of the Loan Parties hereby authorizes each Bank to share any
information delivered to such Bank by such Loan Party and its Subsidiaries
pursuant to this Agreement, or in connection with the decision of such Bank to
enter into this Agreement, to any such Subsidiary or Affiliate of such Bank, it
being understood that any such Subsidiary or affiliate of any Bank receiving
such information shall be bound by the provisions of Section 11.12.1 as if it
were a Bank hereunder. Such Authorization shall survive the repayment of the
Loans and other Obligations and the termination of the Commitments.
11.13 Counterparts.
This Agreement may be executed by different parties hereto on any number
of separate counterparts, each of which, when so executed and delivered, shall
be an original, and all such counterparts shall together constitute one and the
same instrument.
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11.14 Agent's or Bank's Consent.
Whenever the Agent's or any Bank's consent is required to be
obtained under this Agreement or any of the other Loan Documents as a condition
to any action, inaction, condition or event, the Agent and each Bank shall be
authorized to give or withhold such consent in its sole and absolute discretion
and to condition its consent upon the giving of additional collateral, the
payment of money or any other matter.
11.15 Exceptions.
The representations, warranties and covenants contained herein shall
be independent of each other, and no exception to any representation, warranty
or covenant shall be deemed to be an exception to any other representation,
warranty or covenant contained herein unless expressly provided, nor shall any
such exceptions be deemed to permit any action or omission that would be in
contravention of applicable Law.
11.16 WAIVER OF JURY TRIAL.
EACH LOAN PARTY, THE AGENT AND THE BANKS HEREBY KNOWINGLY,
VOLUNTARILY AND INTENTIONALLY WAIVE TRIAL BY JURY IN ANY ACTION, SUIT,
PROCEEDING OR COUNTERCLAIM OF ANY KIND ARISING OUT OF OR RELATED TO THIS
AGREEMENT, ANY OTHER LOAN DOCUMENT OR ANY COLLATERAL, OR ANY COURSE OF CONDUCT,
COURSE OF DEALINGS, STATEMENTS (WHETHER VERBAL OR WRITTEN) OR ACTIONS OF ANY
PARTY, INCLUDING, WITHOUT LIMITATION, ANY COURSE OF CONDUCT, COURSE OF DEALINGS,
STATEMENTS OR ACTIONS OF THE AGENT OR THE BANKS RELATING TO THE ADMINISTRATION
OF THE LOANS OR ENFORCEMENT OF THIS AGREEMENT OR THE LOAN DOCUMENTS, TO THE
FULLEST EXTENT PERMITTED BY LAW. NO LOAN PARTY WILL SEEK TO CONSOLIDATE ANY SUCH
ACTION WITH ANY OTHER ACTION IN WHICH A JURY TRIAL CANNOT BE OR HAS NOT BEEN
WAIVED. EACH LOAN PARTY CERTIFIES THAT NO REPRESENTATIVE, AGENT OR ATTORNEY OF
AGENT OR THE BANKS, HAS REPRESENTED, EXPRESSLY OR OTHERWISE, THAT AGENT OR THE
BANKS WOULD NOT, IN THE EVENT OF LITIGATION, SEEK TO ENFORCE THE FOREGOING
WAIVER. THIS WAIVER CONSTITUTES A MATERIAL INDUCEMENT FOR AGENT AND THE BANKS TO
ACCEPT THIS AGREEMENT AND THE LOAN DOCUMENTS AND MAKE THE LOANS.
11.17 JURISDICTION & VENUE.
EACH LOAN PARTY HEREBY IRREVOCABLY CONSENTS TO THE NONEXCLUSIVE
JURISDICTION OF COURTS IN THE COUNTY OF MIDDLESEX IN THE STATE OF NEW JERSEY AND
THE UNITED STATES DISTRICT COURT FOR THE DISTRICT OF NEW JERSEY, AND WAIVES
PERSONAL SERVICE OF ANY AND ALL PROCESS UPON IT AND CONSENTS THAT ALL SUCH
SERVICE OF PROCESS BE MADE BY CERTIFIED OR REGISTERED MAIL (RETURN RECEIPT
97
REQUESTED) DIRECTED TO SUCH LOAN PARTY AT THE ADDRESSES PROVIDED FOR IN SECTION
Error! Reference source not found. [NOTICES; LENDING OFFICES] AND SERVICE SO
MADE SHALL BE DEEMED TO BE COMPLETED UPON ACTUAL RECEIPT THEREOF. NOTHING
CONTAINED HEREIN SHALL AFFECT THE RIGHT OF AGENT TO SERVE LEGAL PROCESS BY ANY
OTHER MANNER PERMITTED BY LAW. EACH LOAN PARTY IRREVOCABLY WAIVES ANY OBJECTION
TO JURISDICTION AND VENUE OF ANY ACTION INSTITUTED AGAINST IT AS PROVIDED HEREIN
AND AGREES NOT TO ASSERT ANY DEFENSE BASED ON FORUM NON CONVENIENS OR ANY LACK
OF JURISDICTION OR VENUE THAT IT MAY NOW OR HEREAFTER HAVE TO THE BRINGING OF
ANY ACTION OR PROCEEDING WITH RESPECT TO THIS AGREEMENT.
11.18 Certifications From Banks and Participants.
11.18.1. Tax Withholding.
Each Bank or assignee or Participant of a Bank that is not
incorporated under the laws of the United States of America or a state thereof
(and, upon the written request of the Agent, each other Bank or assignee or
Participant or a Bank) agrees that it will deliver to each of the Borrower and
the Agent two (2) duly completed appropriate valid Withholding Certificates (as
defined under Section 1.1441-1(c)(16) of the Income Tax Regulations (the
"Regulations")) certifying its status (i.e., United States or foreign person)
and, if appropriate, making a claim of reduced, or exemption from, United States
withholding tax on the basis of an income tax treaty or an exemption provided by
the Internal Revenue Code (the "Code"). Such delivery may be made by electronic
transmission as described in Section 1.1441-1(e)(4)(iv) of the Regulations if
the Agent establishes an electronic delivery system. The term "Withholding
Certificate" means a Form W-9; a Form W-8BEN; a Form W-8ECI; a Form W-81MY and
the related statements and certifications as required under Section
1.1441-1(e)(3) of the Regulations; a statement described in Section
1.871-14(c)(2)(v) of the Regulations; or any other certificates under the Code
or Regulations that certify or establish the status of a payee or beneficial
owner as a United States or foreign person. Each Bank, assignee or Participant
required to deliver to the Borrower and the Agent a valid Withholding
Certificate pursuant to the preceding sentence shall deliver such valid
Withholding Certificate as follows: (A) each Bank which is a party hereto on the
Closing Date shall deliver such valid Withholding Certificate at least five (5)
Business Days prior to the first date on which any interest or Fees are payable
by the Borrower hereunder for the account of such Bank; (B) each assignee or
Participant shall deliver such valid Withholding Certificate at least five (5)
Business Days before the effective date of such assignment or Participation
(unless the Agent in its sole discretion shall permit such assignee or
Participant to deliver such Withholding Certificate less than five (5) Business
Days before such date in which case it shall be due on the date specified by the
Agent). Each Bank, assignee or Participant which so delivers a valid Withholding
Certificate further undertakes to deliver to each of the Borrower and the Agent
two (2) additional copies of such Withholding Certificate (or a successor form)
on or before the date that such Withholding Certificate expires or becomes
obsolete or after the occurrence of any event requiring a change in the most
recent Withholding Certificate so delivered by it, and such amendments thereto
or extensions or renewals thereof as may be reasonably requested by the Borrower
or the Agent. Notwithstanding the submission of a Withholding Certificate
claiming a
98
reduced rate of, or exemption from, United States withholding taxes, the Agent
shall be entitled to withhold United States federal income taxes at the full 30%
withholding rate if in its reasonable judgment it is required to do so under the
due diligence requirements imposed upon a withholding agent under Section
1.1441-7(b) of the Regulations. Further, the Agent is indemnified under Section
1.1461-1(e) of the Regulations against any claims and demands of any Bank or
assignee or Participant of a Bank for the amount of any tax it deducts and
withholds in accordance with regulations under Section 1441 of the Internal
Revenue Code.
11.18.2. USA Patriot Act.
Each Bank or assignee or participant of a Bank that is not
incorporated under the laws of the United States of America or a state thereof
(and is not excepted from the certification requirement contained in Section 313
of the USA Patriot Act and the applicable regulations because it is both (i) an
affiliate of a depository institution or foreign bank that maintains a physical
presence in the United States or foreign county, and (ii) subject to supervision
by a banking authority regulating such affiliated depository institution or
foreign bank) shall deliver to the Agent the certification, or, if applicable,
recertification, certifying that such Bank is not a "shell" and certifying to
other matters as required by Section 313 of the USA Patriot Act and the
applicable regulations: (1) within 10 days after the Closing Date, and (2) as
such other times as are required under the USA Patriot Act.
11.19 Joinder of Guarantors.
Any Subsidiary of the Borrower which is required to join this
Agreement as a Guarantor pursuant to Section ERROR! REFERENCE SOURCE NOT FOUND.
[Liquidations, Mergers, Consolidations, Acquisitions] and Section ERROR!
REFERENCE SOURCE NOT FOUND. [Subsidiaries, Partnerships and Joint Ventures]
shall (i) execute and deliver to the Agent a Guarantor Joinder in substantially
the form attached hereto as Exhibit ERROR! REFERENCE SOURCE NOT FOUND.(G)(1)
pursuant to which it shall join as a Guarantor each of the documents to which
the Guarantors are parties; and (ii) execute and deliver to the Agent documents
in the forms described in Section ERROR! REFERENCE SOURCE NOT FOUND.
[Secretary's Certificate] modified as appropriate to relate to such Subsidiary
and (iii) satisfy such other requirements as reasonably requested by the Agent.
The Loan Parties shall deliver such Guarantor Joinder and related documents to
the Agent within five (5) Business Days after the date of the filing of such
Subsidiary's articles of incorporation if the Subsidiary is a corporation, the
date of the filing of its certificate of limited partnership if it is a limited
partnership or the date of its organization if it is an entity other than a
limited partnership or corporation.
[SIGNATURE PAGES FOLLOW]
99
[SIGNATURE PAGE TO NEW JERSEY
RESOURCES CORPORATION CREDIT AGREEMENT]
IN WITNESS WHEREOF, and intending to be legally bound hereby, the parties
hereto have executed this Agreement as of the date first above written.
BORROWER:
ATTEST: NEW JERSEY RESOURCES CORPORATION
_____________________________ By:_____________________________[Seal]
Name: _______________________ Name:_________________________________
Title:_______________________ Title:________________________________
[SIGNATURE PAGE TO NEW JERSEY
RESOURCES CORPORATION CREDIT AGREEMENT]
GUARANTORS:
NJNR PIPELINE COMPANY
By:_______________________________
Name:_____________________________
Title:____________________________
[SIGNATURE PAGE TO NEW JERSEY
RESOURCES CORPORATION CREDIT AGREEMENT]
NJR ENERGY CORPORATION
By:_______________________________
Name:_____________________________
Title:____________________________
[SIGNATURE PAGE TO NEW JERSEY
RESOURCES CORPORATION CREDIT AGREEMENT]
NJR ENERGY SERVICES COMPANY
By:_______________________________
Name:_____________________________
Title:____________________________
[SIGNATURE PAGE TO NEW JERSEY
RESOURCES CORPORATION CREDIT AGREEMENT]
NJR HOME SERVICES COMPANY
By:_______________________________
Name:_____________________________
Title:____________________________
[SIGNATURE PAGE TO NEW JERSEY
RESOURCES CORPORATION CREDIT AGREEMENT]
COMMERCIAL REALTY AND RESOURCES
CORP.
By:_______________________________
Name:_____________________________
Title:____________________________
[SIGNATURE PAGE TO NEW JERSEY
RESOURCES CORPORATION CREDIT AGREEMENT]
BANK OF TOKYO-MITSUBISHI TRUST
COMPANY, individually and as
Documentation Agent
By:_______________________________
Name:_____________________________
Title:____________________________
[SIGNATURE PAGE TO NEW JERSEY
RESOURCES CORPORATION CREDIT AGREEMENT]
CALYON NEW YORK BRANCH
By:_______________________________
Name:_____________________________
Title:____________________________
By:_______________________________
Name:_____________________________
Title:____________________________
[SIGNATURE PAGE TO NEW JERSEY
RESOURCES CORPORATION CREDIT AGREEMENT]
CITICORP NORTH AMERICA, INC.,
individually and as Documentation Agent
By:_______________________________
Name:_____________________________
Title:____________________________
[SIGNATURE PAGE TO NEW JERSEY
RESOURCES CORPORATION CREDIT AGREEMENT]
CITIZENS BANK OF MASSACHUSETTS
By:_______________________________
Name: Michael G. Ouellet
Title: Vice President
[SIGNATURE PAGE TO NEW JERSEY
RESOURCES CORPORATION CREDIT AGREEMENT]
COMERICA BANK
By:_______________________________
Name:_____________________________
Title:____________________________
[SIGNATURE PAGE TO NEW JERSEY
RESOURCES CORPORATION CREDIT AGREEMENT]
FLEET NATIONAL BANK, individually and
as Syndication Agent
By:_______________________________
Name:_____________________________
Title:____________________________
[SIGNATURE PAGE TO NEW JERSEY
RESOURCES CORPORATION CREDIT AGREEMENT]
JPMORGAN CHASE BANK NA, individually
and as Syndication Agent
By:_______________________________
Name:_____________________________
Title:____________________________
[SIGNATURE PAGE TO NEW JERSEY
RESOURCES CORPORATION CREDIT AGREEMENT]
PNC BANK, NATIONAL ASSOCIATION,
individually and as Agent
By:_______________________________
Name:_____________________________
Title:____________________________
[SIGNATURE PAGE TO NEW JERSEY
RESOURCES CORPORATION CREDIT AGREEMENT]
THE BANK OF NEW YORK
By:_______________________________
Name:_____________________________
Title:____________________________
SCHEDULE 1.1(A)
PRICING GRID
DEBT RATING
[STANDARD AND POOR'S
AND MOODY'S, FACILITY BASE RATE EURO-RATE LETTER OF
LEVEL RESPECTIVELY] FEE SPREAD SPREAD CREDIT FEE
- ------ -------------------------- --------- -------- --------- ----------
I A+ or above .125% 0% .525% .525%
or
A1 or above
II A- or above but less .150% 0% .600% .600%
than A+
or
A3 or above but less
than A1
III BBB or above but less .175% 0% .725% .725%
than A-
or
Baa2 or above but less
than A3
IV Less than BBB or .250% 0% .900% .900%
less than Baa2 or
unrated
For purposes of determining the Applicable Margin, the Applicable Facility Fee
Rate and the Applicable Letter of Credit Fee Rate:
(a) With respect to the Debt Ratings of Moody's and Standard and Poor's:
(i) if one or both of Moody's or Standard and Poor's shall fail to have a Debt
Rating in effect, then such rating agency which fails to have a Debt Rating in
effect shall be deemed to have established a Debt Rating at Level IV, and (ii)
if the Debt Rating established by Moody's and the Debt Rating established by
Standard and Poor's differ, the pricing Level above shall be determined based
upon the higher of the Debt Rating established by Moody's and the Debt Rating
established by Standard and Poor's, provided, however, if one of the Debt
Ratings is two or more Levels lower than the other, the applicable pricing Level
shall be determined at the Level next above that of the Level of the lower of
the two Debt Ratings.
(b) Any change in the Applicable Margin, the Applicable Facility Fee
Rate, or the Applicable Letter of Credit Fee Rate shall become effective on the
date of any public announcement of the change in the Debt Rating requiring such
an increase or decrease.
SCHEDULE 1.1(P)
PERMITTED LIENS
SCHEDULE 6.1.12
CONSENTS AND APPROVALS
SCHEDULE 8.2.1
EXISTING INDEBTEDNESS