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EXHIBIT 10.9
REVOLVING PROMISSORY NOTE
$30,000,000.00 Houston, Texas May 12, 2000
1. FOR VALUE RECEIVED, the undersigned, RELIANT ENERGY MID-ATLANTIC
POWER HOLDINGS, LLC, a Delaware corporation (the "Borrower"), whose address is
1111 Louisiana Street, Houston, Texas 77002, hereby promises to pay to the order
of RELIANT ENERGY NORTHEAST HOLDINGS, INC., a Delaware corporation (the
"Lender"), whose address is 200 West Ninth Street Plaza, Suite 411, Wilmington,
DE 19801, Thirty Million and No/100's Dollars ($30,000,000.00), or, if less,
the aggregate principal amount of Loans (as defined below) outstanding
hereunder on May 12, 2002 (the "Maturity Date"), together with accrued and
unpaid interest thereon from the date hereof until such maturity, at the rates
per annum and on the dates and in the manner specified in this Note.
2. The obligation of Lender to make any advance hereunder is subject to
the condition precedent that, as of the date of such advance and after giving
effect thereto, no Event of Default (as hereinafter defined) shall have occurred
and be continuing. Subject to the previous sentence, on any day on which Lender
and banks are open for business in Houston, Texas (a "Business Day"), Lender
shall make loans (the "Loans") to Borrower and Borrower shall borrow from Lender
in the amounts and on the terms hereinafter set forth. All Loans made by Lender
to Borrower pursuant hereto and all repayments of the principal thereof and
interest thereon shall be recorded by Lender on the schedule attached hereto, or
on a continuation of such schedule to be attached to and made a part hereof, and
any such recordation shall constitute prima facie evidence of the accuracy of
such information so recorded; provided, however, that the failure of Lender to
record any such Loans and repayments on the schedule attached hereto shall not
diminish Borrower's obligation to repay all principal outstanding under any Loan
and to pay all interest accrued and unpaid in respect of any Loan under this
Note in accordance with its terms. Within the limits of the foregoing, Borrower
may borrow, repay and reborrow under this Note.
3. Each Loan will be made on notice by Borrower to Lender given not
later than 9:00 a.m. Houston time on the Business Day on which Borrower requests
that the Loan be made. Each such notice may be by telephone, confirmed promptly
thereafter in writing by Borrower, specifying the amount of funds to be
borrowed, the date such Loan is requested to be made, and the period of time for
which such Loan is requested to be made, which period shall commence and end on
a day which is a Business Day, and the bank account of Borrower which is to be
credited with such Loan funds. All such notices shall be deemed effective for
purposes of this Note on the day when given by Borrower by telephone.
Lender shall, on the Business Day on which the Loan is requested,
credit Borrower's bank account specified in such notice with the amount of the
Loan, in immediately available funds.
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4. Each Loan shall bear interest at a varying rate per annum equal to
the lesser of (a) the Base Rate (as hereinafter defined) plus .15% per annum,
such varying rate to change automatically every calendar month, effective as of
the first day of each calendar month, to reflect the Base Rate in effect on such
day commencing May 12, 2000 and on the first day of each calendar month
thereafter, without notice to Borrower or any other person or (b) the highest
rate permitted under applicable law (the "Maximum Lawful Rate"). For purposes of
this Agreement, the "Base Rate" means a fluctuating per annum rate of interest
which is the weighted average interest rate for commercial paper issued by
Houston Industries Finance Co LP for the preceding calendar month. All
calculations of interest hereunder shall be made on the basis of a year of 365
or 366 days, as the case may be, for the actual number of days (including the
first day but excluding the last day) occurring in the period for which interest
is payable.
5. The President of Borrower or any person from time to time designated
to Lender in writing by the President of Borrower, shall have authority to
borrow funds from Lender hereunder, to make interest payments hereunder, to give
notices of and to make repayments of Loans outstanding hereunder.
All written notices to Borrower from Lender and from Lender to
Borrower shall be sent to the respective parties at the addresses set forth
above, Attention: President. All telephone borrowing notices to Lender shall be
made to James E. Hammelman, (713)207-3351.
6. Subject to the right of the holder of this Note to accelerate the
maturity hereof as hereinafter described, the principal of this Note shall be
due and payable on the Maturity Date and accrued and unpaid interest on the
principal amount outstanding on this Note shall be due and payable to Lender at
its address set forth above as it accrues quarterly on each January 1, April 1,
July 1 and October 1 throughout the term of this Note, beginning on July 1,
2000, until all unpaid principal and accrued and unpaid interest on this Note
shall be paid in full.
7. At any time, Borrower may prepay any amounts owing hereunder in
whole or in part, without penalty. If any payment of principal or interest on
this Note shall become due on a Saturday, Sunday, or public holiday on which
Lender is not open for business, such payment shall be made on the next
succeeding Business Day and such extension of time shall in such case be
included in computing interest in connection with such payment. All payments
made in accordance with this Note are to be made in lawful money of the United
States of America in same day funds at the locations specified herein, or such
other place as Lender shall designate in writing to Borrower.
8. If any of the following events (each, an "Event of Default") shall
occur and be continuing, the obligation of Lender to make any further advance
hereunder shall terminate and, with respect to any Event of Default described in
section 7(b) or (c), the outstanding principal balance of this Note, together
with accrued and unpaid interest and any other sums that Borrower may owe to
Lender under or in connection with this Note or otherwise (collectively, the
"Indebtedness") shall automatically become immediately due and payable, and,
with respect to any other Event of Default hereunder, the holder of this Note
may, at its option, by notice in writing to Borrower (given by
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United States mail, postage prepaid, at the address for Borrower shown above)
declare the Indebtedness to be, and thereupon the Indebtedness shall forthwith
become, due and payable, without any further notice of any kind to Borrower, all
of which notices are expressly waived below:
a. Borrower does not pay or prepay any principal or interest on
or with respect to the Indebtedness evidenced by this Note
when due and such failure continues for five days after
Borrower's receipt of written notice from Lender of such
default;
b. the Borrower (i) admits in writing its inability to pay its
debts generally as they become due; (ii) generally fails to
pay its debts as they become due; (iii) files a petition or
answer seeking for itself, or consenting to or acquiescing in
any reorganization, arrangement, composition, readjustment,
liquidation, dissolution or similar relief under, any
bankruptcy law or any insolvency law or other law for the
relief or aid of debtors (including, without limitation, the
United States Bankruptcy Code or any amendment thereto); or
(iv) makes an assignment for the benefit of its creditors; or
c. there is appointed a receiver, custodian, liquidator, fiscal
agent or trustee of Borrower or of the whole or any
substantial part of its properties or assets, or any court
enters an order, judgment or decree approving a petition filed
against Borrower seeking reorganization, arrangement,
composition, readjustment, liquidation, dissolution or similar
relief under any law referred to in paragraph (b) above and
either such order, judgment or decree so filed against it is
not dismissed or stayed (unless and until such stay is no
longer in effect) within 30 days of entry thereof or an order
for relief is entered pursuant to any such law; or
9. Nothing contained in this Note or any other document executed in
connection herewith is intended to require Borrower to pay interest (including
fees, charges or expenses or any other amounts which, under applicable law, are
deemed interest) for the account of Lender at a rate exceeding the Maximum
Lawful Rate.
All agreements between Borrower and Lender, whether now existing
or hereafter arising and whether written or oral, are hereby expressly limited
so that in no contingency or event whatsoever, whether by reason of demand being
made on this Note, prepayment or otherwise, shall the amount paid, or agreed to
be paid, to the Lender for the use, forbearance, or detention of the money to be
loaned under this Note or otherwise or for the payment or performance of any
covenant or obligation contained herein or in any other document executed in
connection herewith exceed the Maximum Lawful Rate. If the amount of any
interest (including fees, charges or expenses or any other amounts which, under
applicable law, are deemed interest) contracted for, taken, reserved, charged or
received by or for the account of Lender, would exceed the Maximum Lawful Rate,
then, ipso facto, the amount of such interest payable for the account of Lender
shall be automatically reduced to such Maximum Lawful Rate, and if, from any
such circumstance, Lender shall ever receive interest or anything which might be
deemed interest under applicable law which would
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exceed the Maximum Lawful Rate, such amount which would be excessive interest
shall be applied to the reduction of the principal amount owing on account
of this Note held by Lender and not to the payment of interest, or if such
excessive interest exceeds the unpaid balance of principal of such Note, such
excess shall be refunded to Borrower. All sums paid or agreed to be paid to
Lender for the use, forbearance or detention of the indebtedness of Borrower to
Lender shall, to the extent permitted by applicable law, be amortized, prorated,
allocated and spread throughout the full term of such indebtedness until payment
in full of the principal (including the period of any renewal or extension
thereof) so that the interest on account of such indebtedness shall not exceed
the Maximum Lawful Rate.
Borrower and Lender further agree that, insofar as the provisions
of Chapter 303 of the Texas Finance Code, as amended, are relevant to the
determination of the maximum rate of interest permitted by applicable law in
respect of this Note, such maximum rate of interest is the weekly rate ceiling
as defined in Chapter 303. Chapter 346 (which regulates certain revolving credit
loan accounts and revolving tri-party accounts) shall not apply to this Note.
10. In addition to all principal and accrued interest on this Note,
Borrower agrees to pay (i) all reasonable costs and expenses incurred by owners
and holders of this Note in collecting this Note through any probate,
reorganization, bankruptcy or any other proceeding; (ii) reasonable attorneys'
fees when and if this Note is placed in the hands of an attorney for collection
after default; and (iii) all attorneys' fees related to the preparation and
execution of this Note and any document, agreement or instrument executed in
connection with or given as security for this Note.
11. Borrower and any and all endorsers, guarantors and sureties
severally waive grace, presentment for payment, notice of dishonor, protest and
notice of protest and diligence in collecting and bringing of suit against any
party hereto. Borrower and any and all endorsers, guarantors and sureties
further agree: (i) to all renewals, extensions, amendments and modifications
hereof without limit, or partial payments hereon; (ii) to any release or
substitution of security herefor, in whole or in part, or any release or
discharge of any guarantor, surety, or co-maker, with or without notice, before
or after maturity; (iii) that waiver of any default shall not constitute waiver
of any prior or subsequent default; and (iv) that no remedy, right or power
conferred upon Lender or the holder of this Note is intended to be exclusive of
any other remedy, right or power given hereunder or now or hereafter available
at law, in equity or otherwise. This Note may be transferred by Lender, and the
rights and privileges of Lender under this Note shall inure to the benefit of
Lender's representatives, successors and assigns.
12. The proceeds of the loans evidenced by this Note shall be used
exclusively for the purpose of financing the working capital needs of Borrower.
The loans evidenced by this Note are for business, commercial, or investment
purposes and none of such proceeds shall be used for personal, consumer, family
household or agricultural purposes or for purchasing or carrying margin stock.
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13. This Note shall be deemed to be a contract under the laws of the
State of Texas and for all purposes shall be construed and enforced in
accordance with the laws of said State and, when applicable, the United States
of America.
14. THIS NOTE AND THE OTHER DOCUMENTS, AGREEMENTS AND INSTRUMENTS
EXECUTED IN CONNECTION HEREWITH REPRESENT THE FINAL AGREEMENT BETWEEN THE
PARTIES AND MAY NOT BE CONTRADICTED BY EVIDENCE OF PRIOR, CONTEMPORANEOUS, OR
SUBSEQUENT ORAL AGREEMENTS OF THE PARTIES. THERE ARE NO UNWRITTEN ORAL
AGREEMENTS BETWEEN THE PARTIES.
REMAINDER OF THIS PAGE INTENTIONALLY LEFT BLANK
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RELIANT ENERGY MID-ATLANTIC POWER HOLDINGS, LLC
By: /s/ JAMES E. HAMMELMAN
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Name: James E. Hammelman
Title: Treasurer
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LOAN SCHEDULE
Principal Unpaid
Amount of Original Interest Amount Paid or Date Paid or Principal Notation Made
Date of Loan Loan Rate Prepaid Prepaid Amount By
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