EXHIBIT 10.1
FIRST AMENDMENT TO CREDIT AGREEMENT
FIRST AMENDMENT (this "Amendment"), dated as of July 12, 2002, to the
$2,500,000,000 Senior A Credit Agreement, dated as of July 13, 2001 (as
heretofore amended, supplemented or otherwise modified, the "Credit Agreement"),
among HOUSTON INDUSTRIES FINANCECO LP, a Delaware limited partnership (the
"Borrower"), RELIANT ENERGY, INCORPORATED, a Texas corporation ("Reliant
Energy"), the several banks and other financial institutions (the "Banks") and
agents from time to time parties thereto and JPMORGAN CHASE BANK (f/k/a The
Chase Manhattan Bank), as administrative agent for the Banks (in such capacity,
the "Agent").
W I T N E S S E T H :
- - - - - - - - - -
WHEREAS, the Borrower, Reliant Energy, the Banks and the Agent are
parties to the Credit Agreement; and
WHEREAS, the Borrower and Reliant Energy have requested that the Banks
agree to extend the Termination Date and amend certain other provisions
contained in the Credit Agreement, and the Banks and the Agent are agreeable to
such request upon the terms and subject to the conditions set forth herein.
NOW, THEREFORE, in consideration of the premises herein contained and
for other good and valuable consideration, the receipt of which is hereby
acknowledged, the parties hereto agree as follows:
1. Defined Terms. Unless otherwise defined herein, capitalized terms
used herein which are defined in the Credit Agreement are used herein as therein
defined.
2. Amendment to Section 1.1 of the Credit Agreement (Certain Defined
Terms). Section 1.1 of the Credit Agreement is hereby amended by deleting, in
their entirety, the terms "Applicable Margin", "Consolidated Capitalization",
"Designated Rating", "Rating Agencies", "Termination Date" and "Usage Fee"
appearing therein and inserting the following new definitions in the appropriate
alphabetical order:
""Applicable Margin" means the rate per annum set forth below
opposite the Designated Rating from time to time in effect during the
period for which payment is due, with respect to any Committed Loan:
<Table>
<Caption>
======================================================================================
Applicable Margin for Applicable Margin for ABR
Designated Rating LIBOR Rate Loans Loans
--------------------------------------------------------------------------------------
BBB+/Baa1 and higher 1.500% 0.500%
--------------------------------------------------------------------------------------
BBB/Baa2 1.650% 0.650%
--------------------------------------------------------------------------------------
BBB-/Baa3 2.000% 1.000%
--------------------------------------------------------------------------------------
BB+/Ba1 or lower or unrated 2.500% 1.500%
======================================================================================
</Table>
In each row in the table set forth above, the first indicated rating
corresponds to that assigned by S&P and the second indicated rating
corresponds to that assigned by Moody's; the determination of which row
of such table is applicable at any time is set forth in the definition
of "Designated Rating".
"Consolidated Capitalization" means, as of any date of
determination, the sum of (a) Consolidated Shareholders' Equity, (b)
Consolidated Indebtedness for Borrowed Money and, without duplication,
(c) Mandatory Payment Preferred Stock; provided that for the purpose of
calculating compliance with Section 8.4(b), Consolidated Capitalization
shall be determined excluding any adjustment, non-cash charge to net
income or other non-cash charges or writeoffs resulting thereto from
application of SFAS No. 142.
"Designated Rating" means (a) at any time that the Long Term
Debt Rating is assigned by both S&P and Moody's and such ratings are
equivalent, such rating shall be the Designated Rating, (b) if clause
(a) does not apply, (i) at any time that the Long Term Debt Rating is
issued by only one of S&P or Moody's, the rating of such debt issued by
such Rating Agency shall be the Designated Rating, and (ii) at any time
that such debt is rated by both S&P and Moody's, the lower of such
ratings and (c) if neither (a) nor (b) apply, if the Long Term Debt
Rating is not assigned by either S&P or Moody's, the rating assigned to
the senior unsecured debt of Reliant Energy shall be the Designated
Rating in accordance with clauses (a) and (b) above. Any change in the
calculation of the Facility Fees or the Applicable Margin with respect
to the Borrower that is caused by a change in the Designated Rating
will become effective on the date of the change in the Designated
Rating. If the rating system of any Rating Agency shall change, or if
either S&P or Moody's shall cease to be in the business of rating
corporate debt obligations, Borrower and the Agent shall negotiate in
good faith if necessary to amend this definition to reflect such
changed rating system or the unavailability of ratings from such Rating
Agencies and, pending the effectiveness of any such amendment, the
Designated Rating shall be determined by reference to the rating most
recently in effect prior to such change or cessation.
"Master Separation Agreement" means the master separation
agreement, dated as of December 31, 2000, entered into between Reliant
Energy and Unregco providing for, among other things, the Spin-off, as
amended, modified or supplemented from time to time.
"Rating Agencies" means S&P and Moody's.
"Term Loans" has the meaning specified in Section 2.1(d).
"Termination Date" means (a) initially October 10, 2002,
unless the Majority Banks direct in writing on or prior to September 5,
2002 that such Termination Date shall be September 10, 2002, in which
case the Termination Date shall automatically be deemed to be September
10, 2002, or (b) any earlier date on which (i) the Commitments have
been terminated in accordance with this Agreement or (ii) all unpaid
principal amounts of Loans hereunder have become due and payable in
accordance with this Agreement.".
3. Amendment to Section 2.1 of the Credit Agreement (The
Committed Loans). Section 2.1 of the Credit Agreement is hereby amended by:
(a) adding at the end of paragraph (b) thereof the following:
"At a reasonable time at least one week prior to September 5,
2002, the Agent shall inquire as to whether requisite Banks
intend to send the written direction referred to in the
definition of Termination Date and shall notify the Borrower
and the Banks if the requisite number of such directives have
been received."; and
(b) adding at the end thereof immediately after paragraph (c)
thereof a new paragraph (d) as follows:
"(d) Notwithstanding anything to the contrary
contained in this Agreement or in the Regco $2.5 Billion
Credit Agreement, on July 12, 2002, 75% of the principal
amount of the Loans of each Bank outstanding on such date
($1,875,000,000 in aggregate) shall be deemed to be term loans
(the "Term Loans"), with the remaining Loans (the "Revolving
Loans") and corresponding Commitments (collectively, the
"Revolving Facility") retaining their revolving features.
Unless the Borrower designates a prepayment of the Loans as a
Term Loan prepayment, all prepayments
2
shall be applied first to outstanding Revolving Loans, and the
Commitments made available thereby may be utilized in
accordance with this Agreement for borrowings, prepayments or
reborrowings and issuances of Letters of Credit, subject to
the conditions of this Agreement applicable thereto. Any
prepayment designated by the Borrower as a Term Loan
prepayment, or any prepayment after giving effect to which the
aggregate principal amount of all Loans then outstanding would
be less than $1,875,000,000 shall, to such extent, be deemed
to be a permanent prepayment of the Term Loans, and the
corresponding Commitments under the Revolving Facility shall
automatically be permanently reduced by the amount thereof.
Each Notice of Borrowing received, and each Loan made, after
July 12, 2002 shall be deemed received and made under the
Revolving Facility. Banks may make assignments, transfers,
novations and delegations of, and sell participations in,
subject to the other provisions of this Agreement, either or
both of its Term Loans and its Revolving Facility. All
references to Loans in this Agreement shall include the Term
Loans and Revolving Loans except to the extent necessary to
effectuate the foregoing.".
4. Amendment to Section 4.2 of the Credit Agreement (Fees).
Section 4.2 of the Credit Agreement is hereby amended by:
(a) deleting the table in paragraph (a) thereof in its
entirety, and inserting in lieu thereof the following table:
<Table>
<Caption>
"Designated Rating Facility Fee Rate
------------------ -----------------
BBB+/Baa1 or higher 0.250%
BBB/Baa2 0.350%
BBB-/Baa3 0.500%
BB+/Ba1 or lower or unrated 0.500%"; and
</Table>
(b) deleting paragraph (b) thereof in its entirety and
substituting in lieu thereof the following:
"(b) [INTENTIONALLY OMITTED.]"; and
(c) amending paragraph (c) thereof by (i) deleting the phrase
"and Usage Fees" and (ii) deleting the reference to "Sections 4.2(a) and 4.2(b)"
and substituting in lieu thereof "Section 4.2(a)".
5. Amendment to Section 4.4(a) of the Credit Agreement (ABR
Loans). Section 4.4(a) of the Credit Agreement is hereby amended by adding
immediately after "ABR" in clause (i) therein "plus the Applicable Margin".
6. Amendment to Section 8.4(b) of the Credit Agreement
(Financial Ratios). Section 8.4(b) of the Credit Agreement is hereby amended by
deleting the ratio "0.65:1.00" and substituting in lieu thereof "0.68:1.00".
7. Amendment to Section 8.4(g) of the Credit Agreement
(Certain Investments, Loans, Advances, Guarantees and Acquisitions). Section
8.4(g) of the Credit Agreement is hereby amended by adding at the end thereof
the following:
"Notwithstanding the foregoing, Reliant Energy and
its Subsidiaries shall not (x) make any future investments in,
loans to, advances to and Guarantees of any obligations in
Unregco or any of its Subsidiaries, (y) purchase or otherwise
acquire (in one transaction or a series of related
transactions) any assets of Unregco or any of its Subsidiaries
other than, in the case of this clause (y), any such
transactions contemplated by the Master Separation Agreement
and other agreements and arrangements in respect of the
relationship between Reliant Energy and Unregco described in
Reliant Energy's filings with the SEC or (z) enter into any
other transaction
3
constituting a Reliant Energy Investment with Unregco and its
Subsidiaries other than, in the case of this clause (z), the
transactions contemplated by the Master Separation Agreement
and other agreements and arrangements in respect of the
relationship between Reliant Energy and Unregco described in
Reliant Energy's filings with the SEC or other arrangements
among Reliant Energy, Unregco and their respective
Subsidiaries in the ordinary course of business consistent
with recent past practices or otherwise at prices and on terms
and conditions not less favorable to Reliant Energy or its
Subsidiaries (other than Unregco and its Subsidiaries) than
could be obtained on an arm's length basis from unrelated
third parties.".
8. Amendment to Article XI of the Credit Agreement
(Miscellaneous). Article XI of the Credit Agreement is hereby amended by:
(a) deleting "or" at the end of clause (iv) of Section 11.1
and substituting in lieu thereof a semicolon, (b) deleting the period
at the end of clause (v) thereof and substituting in lieu thereof ";
or" and (c) adding at the end thereof immediately after clause (v) a
new clause (vi) as follows:
"(vi) amend, modify or waive the last paragraph of
Section 8.4(g) without the written consent of the
Supermajority Banks.";
(b) adding immediately after the first sentence in
Section 11.6(c) the following:
"Notwithstanding the foregoing, with respect to the sale by a
Bank of all or any part of its rights and obligations in
respect of the Term Loans, (a) each such sale shall not
require the consent of the Agent, the Borrower or any other
Bank or Banks, (b) each such sale that is not to an existing
Bank hereunder shall be in an aggregate amount of not less
than $1,000,000 (or such lesser amount that represents the
aggregate amount of Term Loans of such Bank), (c) each such
sale may be to an Eligible Transferee (as defined below) and
each such Eligible Transferee shall be deemed to be a
Purchasing Bank and a Bank for all purposes under this Section
11.6(c) and this Agreement and (d) each such sale shall be
consummated pursuant to a Committed Loan Assignment and
Acceptance with such modifications as may be agreed on by the
transferor Bank and the applicable transferee and consistent
with this Section 11.6(c). For purposes of this Section
11.6(c), "Eligible Transferee" shall mean (w)(i) any bank or
other financial institution, (ii) any insurance or reinsurance
company, (iii) a mutual fund, unit trust or similar collective
investment vehicle (other than an entity specified in clause
(y)(i) below), and (iv) a registered or licensed broker or
dealer (other than a natural person or proprietorship);
provided, however, in the case of each of the foregoing
clauses (i) through (iv), that such entity has total assets of
at least $500,000,000; (x) any Affiliate (as defined below) of
an entity specified in the preceding clause (w); (y) any
corporation, partnership, proprietorship, organization trust
or other entity (i) that is an investment vehicle (including,
without limitation, any hedge fund, issuer of collateralized
debt obligations, commercial paper conduit or other special
purpose vehicle) that (A) has total assets of at least
$100,000,000 or (B) is one of a group of investment vehicles
under common control or management having, in the aggregate,
total assets of at least $100,000,000, (ii) that has total
assets of at least $500,000,000, or (iii) the obligations of
which under an agreement, contract, or transaction are
guaranteed or otherwise supported by a letter of credit or
keepwell, support, or other agreement by an entity described
in clauses (w), (x), (y)(ii) or (z); and (z) a Sovereign,
Sovereign Agency or Supranational Organization (each as
defined below). For purposes of the foregoing sentence, (a)
"Affiliate" means, in relation to a person, any entity
controlled, directly or indirectly, by the person, any entity
that controls, directly or indirectly, the person or any
entity directly or indirectly under common control with the
person, (b) "control" of any entity or person means ownership
of a majority of the voting power of the entity or person, (c)
"Sovereign" means any state, political subdivision or
government, or any agency, instrumentality, ministry,
department or other authority (including, without limiting the
foregoing, the central bank) thereof, (d) "Sovereign Agency"
means any agency, instrumentality, ministry, department or
other authority (including, without limiting the foregoing,
the central bank) of a Sovereign and (e) "Supranational
Organization" means any entity or organization established by
treaty or other
4
arrangement between two or more Sovereigns or the Sovereign
Agencies of two or more Sovereigns and includes, without
limiting the foregoing, the International Monetary Fund,
European Central Bank, International Bank for Reconstruction
and Development and European Bank for Reconstruction and
Development."; and
(c) adding at the end thereof immediately after Section 11.17
a new Section 11.18 as follows:
"Section 11.18. Borrower as Co-Obligor Under the
Regco $2.5 Billion Credit Agreement. Notwithstanding any
provision in this Agreement or in the Regco $2.5 Billion
Credit Agreement to the contrary, upon the assumption by Regco
of the obligations in respect of the Loans hereunder and all
other monetary obligations in respect hereof pursuant to the
Regco $2.5 Billion Credit Agreement, Houston Industries
FinanceCo LP shall, until the Termination Date (as defined in
the Regco $2.5 Billion Credit Agreement), be a joint and
several obligor with Regco in respect of all such
obligations.".
9. Amendment to Exhibit L to the Credit Agreement (Form of
Regco $2.5 Billion Credit Agreement). Exhibit L to the Credit Agreement (the
"Regco Credit Agreement") is hereby amended in the manner set forth on
Exhibit A.
10. Confirmation and Reaffirmation of Loan Documents. Each
Loan Party does hereby (a) consent and acknowledge and agree to the transactions
described in this Amendment and (b) after giving effect to this Amendment, (i)
confirms, reaffirms and restates the representations and warranties (except for
those representations or warranties or parts thereof that, by their terms,
expressly relate solely to a specific date) made by it in each Loan Document to
which it is a party, (ii) ratifies and confirms each Loan Document to which it
is a party and (iii) confirms and agrees that each such Loan Document is, and
shall continue to be in full force and effect, with (to the extent applicable)
the collateral described therein securing and continuing to secure, the payment
of all obligations of such Loan Party referred to therein; provided that each
reference to the Credit Agreement therein and in each of the other Loan
Documents shall be deemed to be a reference to the Credit Agreement after giving
effect to this Amendment.
11. Conditions to Effectiveness. This Amendment shall become
effective as of the date set forth above upon satisfaction of the following
conditions precedent:
(a) The Agent shall have received counterparts of this
Amendment executed by the Borrower, Reliant Energy and each of the
Banks;
(b) The Agent shall have received an amendment fee for the
account of each Bank in an amount equal to 0.125% of such Bank's
Commitment;
(c) All corporate and other proceedings, and all documents,
instruments and other legal matters in connection with this Amendment
shall be in form and substance reasonably satisfactory to the Agent;
(d) The Agent shall have received all fees and expenses
required to be paid in connection with the Credit Agreement; and
(e) The Agent shall have received satisfactory legal opinions
and other documents and certificates reasonably requested by the Agent.
12. Reference to and Effect on the Loan Documents; Limited
Effect. On and after the date hereof and the satisfaction of the conditions
contained in Section 11 of this Amendment, each reference in the Credit
Agreement to "this Agreement", "hereunder", "hereof" or words of like import
referring to the Credit Agreement, and each reference in the other Loan
Documents to "the Credit Agreement", "thereunder", "thereof" or words of like
import referring to the Credit Agreement, shall mean and be a reference to the
Credit Agreement as amended hereby. The execution, delivery and effectiveness of
this Amendment shall not, except as expressly provided herein,
5
operate as a waiver of any right, power or remedy of any Bank or the Agent under
any of the Loan Documents, nor constitute a waiver of any provisions of any of
the Loan Documents. Except as expressly amended herein, all of the provisions
and covenants of the Credit Agreement and the other Loan Documents are and shall
continue to remain in full force and effect in accordance with the terms thereof
and are hereby in all respects ratified and confirmed.
13. Representations and Warranties. Each of the Borrower and
Reliant Energy, as of the date hereof and after giving effect to the amendment
contained herein, hereby confirms, reaffirms and restates the representations
and warranties (except for those representations or warranties or parts thereof
that, by their terms, expressly relate solely to a specific date) made by it in
Article VII of the Credit Agreement and otherwise in the Loan Documents to which
it is a party; provided that each reference to the Credit Agreement therein
shall be deemed to be a reference to the Credit Agreement after giving effect to
this Amendment.
14. Counterparts. This Amendment may be executed by one or
more of the parties hereto in any number of separate counterparts (which may
include counterparts delivered by facsimile transmission) and all of said
counterparts taken together shall be deemed to constitute one and the same
instrument. Any executed counterpart delivered by facsimile transmission shall
be effective as an original for all purposes hereof. The execution and delivery
of this Amendment by any Bank shall be binding upon each of its successors and
assigns (including Transferees of its Commitments and Loans in whole or in part
prior to effectiveness hereof) and binding in respect of all of its Commitments
and Loans, including any acquired subsequent to its execution and delivery
hereof and prior to the effectiveness hereof.
15. GOVERNING LAW. THIS AMENDMENT SHALL BE GOVERNED BY, AND
CONSTRUED AND INTERPRETED IN ACCORDANCE WITH, THE LAWS OF THE STATE OF NEW YORK.
6
IN WITNESS WHEREOF, the parties hereto have caused this
Amendment to be executed and delivered by their duly authorized officers as of
the date first written above.
HOUSTON INDUSTRIES
FINANCECO LP
By: HOUSTON INDUSTRIES
FINANCECO GP, LLC,
its General Partner
By: /s/ MARC KILBRIDE
-----------------------------------
Name: Marc Kilbride
Title: Treasurer
RELIANT ENERGY, INCORPORATED
By: /s/ MARC KILBRIDE
-----------------------------------
Name: Marc Kilbride
Title: Treasurer
JPMORGAN CHASE BANK, as
Agent and as a Bank
By: /s/ ROBERT TRABAND
-----------------------------------
Name: Robert Traband
Title: Vice President
Signature Page
Senior A Credit Agreement Amendment
ABN AMRO BANK N.V.
By: /s/ THOMAS J. STARR
-----------------------------------
Name: Thomas J. Starr
Title: Vice President
By: /s/ KRIS A. GROSSHANS
-----------------------------------
Name: Kris A. Grosshans
Title: Senior Vice President
Signature Page
Senior A Credit Agreement Amendment
BANK HAPOALIM, B.M.
By: /s/ SHAUN BREIDBART
-----------------------------------
Name: Shaun Breidbart
Title: Vice President
By: /s/ LAURA ANNE RAFFA
-----------------------------------
Name: Laura Anne Raffa
Title: Senior Vice President and
Corporate Manager
Signature Page
Senior A Credit Agreement Amendment
BANK ONE, N.A.
By: /s/ GEORGE R. SCHANZ
-----------------------------------
Name: George R. Schanz
Title: Managing Director
Signature Page
Senior A Credit Agreement Amendment
BANK OF AMERICA, N.A.
By: /s/ RICHARD L. STEIN
-----------------------------------
Name: Richard L. Stein
Title: Principal
Signature Page
Senior A Credit Agreement Amendment
THE BANK OF NOVA SCOTIA
By: /s/ M.D. SMITH
-----------------------------------
Name: M.D. Smith
Title: Agent, Operations
Signature Page
Senior A Credit Agreement Amendment
THE BANK OF TOKYO-MITSUBISHI, LTD.
By: /s/ D. BARNELL
-----------------------------------
Name: D. Barnell
Title: Vice President
By: /s/ JOHN M. MEANS
-----------------------------------
Name: J. Means
Title: VP and Manager
Signature Page
Senior A Credit Agreement Amendment
BARCLAYS BANK PLC
By: /s/ ERIC CHILTON
-----------------------------------
Name: Eric Chilton
Title: Managing Director
Signature Page
Senior A Credit Agreement Amendment
BAYERISCHE LANDESBANK
GIROZENTRALE, CAYMAN ISLANDS BRANCH
By: /s/ HEREWARD DRUMMOND
-----------------------------------
Name: Hereward Drummond
Title: Senior Vice President
By: /s/ SEAN O'SULLIVAN
-----------------------------------
Name: Sean O'Sullivan
Title: Vice President
Signature Page
Senior A Credit Agreement Amendment
CITIBANK, N.A.
By: /s/ SANDIP SEN
-----------------------------------
Name: Sandip Sen
Title: Managing Director
Signature Page
Senior A Credit Agreement Amendment
COBANK
By: /s/ CATHLEEN D. REED
-----------------------------------
Name: Cathleen D. Reed
Title: Assistant Vice President
Signature Page
Senior A Credit Agreement Amendment
COMMERZBANK AG
New York and Grand Cayman Branches
By: /s/ HARRY P. YERGEY
-----------------------------------
Name: Harry P. Yergey
Title: Senior Vice President and Manager
By: /s/ W. DAVID SUTTLES
-----------------------------------
Name: W. David Suttles
Title: Vice President
Signature Page
Senior A Credit Agreement Amendment
CREDIT LYONNAIS NEW YORK BRANCH
By: /s/ BERNARD WEYMULLER
-----------------------------------
Name: Bernard Weymuller
Title: Senior Vice President
Signature Page
Senior A Credit Agreement Amendment
CREDIT SUISSE FIRST BOSTON
By: /s/ JAMES P. MORAN /s/ DAVID M. KOCZAN
----------------------------------------------
Name: James P. Moran David M. Koczan
Title: Director Associate
Signature Page
Senior A Credit Agreement Amendment
DEUTSCHE BANK AG NEW YORK BRANCH
AND/OR CAYMAN ISLANDS BRANCH
By: /s/ HANS C. NARBERHAUS
-----------------------------------
Name: Hans C. Narberhaus
Title: Vice President
By: /s/ JOEL MAKOWSKY
-----------------------------------
Name: Joel Makowsky
Title: Vice President
Signature Page
Senior A Credit Agreement Amendment
ERSTE BANK
By: /s/ ROBERT SUEHNHOLZ /s/ PATRICK W. SOMMER
------------------------------------------------
Name: Robert Suehnholz Patrick W. Sommer
Title: 1st Vice President Vice President
Erste Bank New York
Branch
Signature Page
Senior A Credit Agreement Amendment
WACHOVIA BANK, NATIONAL ASSOCIATION
(f/k/a First Union National Bank)
By: /s/ ROTCHER WATKINS
-----------------------------------
Name: Rotcher Watkins
Title: Managing Director
Signature Page
Senior A Credit Agreement Amendment
KBC BANK N.V.
By: /s/ ROBERT SNAUFFER
-----------------------------------
Name: Robert Snauffer
Title: First Vice President
By: /s/ ERIC RASKIN
-----------------------------------
Name: Eric Raskin
Title: Vice President
Signature Page
Senior A Credit Agreement Amendment
MELLON BANK, N.A.
By: /s/ RICHARD A. MATTHEWS
-----------------------------------
Name: Richard A. Matthews
Title: First Vice President
Signature Page
Senior A Credit Agreement Amendment
MIZUHO CORPORATE BANK, LTD
By: /s/ TORU MAEDA
-----------------------------------
Name: Toru Maeda
Title: General Manager
Signature Page
Senior A Credit Agreement Amendment
THE NORTHERN TRUST COMPANY
By: /s/ MELISSA A. WHITSON
-----------------------------------
Name: Melissa A. Whitson
Title: Vice President
Signature Page
Senior A Credit Agreement Amendment
ROYAL BANK OF CANADA
By: /s/ DAVID A. MCCLUSKEY
-----------------------------------
NAME: David A. McCluskey
Title: Manager
Signature Page
Senior A Credit Agreement Amendment
SUMITOMO MITSUI BANKING CORPORATION
By: DAVID A. BUCK
-----------------------------------
Name: David A. Buck
Title: Senior Vice President
Signature Page
Senior A Credit Agreement Amendment
TORONTO DOMINION (TEXAS) INC.
By: /s/ MARK A. BAIRD
-----------------------------------
Name: Mark A. Baird
Title: Vice President
Signature Page
Senior A Credit Agreement Amendment
UBS AG, STAMFORD BRANCH
By: /s/ DAVID J. KEITEL
-----------------------------------
Name: David J. Keitel
Title: Executive Director
Recovery Management
By: /s/ WILFRED V. SAINT
-----------------------------------
Name: Wilfred V. Saint
Title: Associate Director
Banking Products Services, US
Signature Page
Senior A Credit Agreement Amendment
UFJ BANK LIMITED
By: /s/ LAURANCE J. BRESSLER
-----------------------------------
Name: Laurance J. Bressler
Title: SVP and Group Co-Head
Signature Page
Senior A Credit Agreement Amendment
WESTDEUTSCHE LANDESBANK
GIROZENTRALE, New York Branch
By: /s/ SALVATORE BATTINELLI
-----------------------------------
Name: Salvatore Battinelli
Title: Managing Director
Credit Department
By: /s/ ANTHONY ALESSANDRO
-----------------------------------
Name: Anthony Alessandro
Title: Associate Director
EXHIBIT A
1. Defined Terms. Unless otherwise defined herein, capitalized
terms used herein which are defined in the Regco Credit Agreement are used
herein as therein defined.
2. Amendment to Section 1.01 of the Regco Credit Agreement
(Certain Defined Terms). Section 1.01 of the Regco Credit Agreement is hereby
amended by (a) deleting, in their entirety, the terms "Applicable Margin",
"Designated Rating", "Termination Date" and "Usage Fee" appearing therein and
inserting the following new definitions in the appropriate alphabetical order:
""Applicable Margin" means the rate per annum set forth below
opposite the Designated Rating from time to time in effect during the
period for which payment is due, with respect to any Committed Loan:
<Table>
<Caption>
=================================================================================================
Applicable Margin for Applicable Margin for
Designated Rating Facility Fees LIBOR Rate Loans ABR Loans
-------------------------------------------------------------------------------------------------
BBB+/Baa1 and higher 0.250% 1.500% 0.500%
-------------------------------------------------------------------------------------------------
BBB/Baa2 0.350% 1.650% 0.650%
-------------------------------------------------------------------------------------------------
BBB-/Baa3 0.500% 2.000% 1.000%
-------------------------------------------------------------------------------------------------
BB+/Ba1 or lower or
unrated 0.500% 2.500% 1.500%
=================================================================================================
</Table>
In each row in the table set forth above, the first indicated rating
corresponds to that assigned by S&P and the second indicated rating
corresponds to that assigned by Moody's; the determination of which row
of such table is applicable at any time is set forth in the definition
of "Designated Rating".
"Designated Rating" means (a) at any time that the Long Term
Debt Rating is assigned by both S&P and Moody's and such ratings are
equivalent, such rating shall be the Designated Rating, (b) if clause
(a) does not apply, (i) at any time that the Long Term Debt Rating is
issued by only one of S&P or Moody's, the rating of such debt issued by
such Rating Agency shall be the Designated Rating, and (ii) at any time
that such debt is rated by both S&P and Moody's, the lower of such
ratings and (c) if neither (a) nor (b) apply, if the Long Term Debt
Rating is not assigned by either S&P or Moody's, the rating assigned to
the senior unsecured debt of Reliant Energy shall be the Designated
Rating in accordance with clauses (a) and (b) above. Any change in the
calculation of the Facility Fees or the Applicable Margin with respect
to Borrower that is caused by a change in the Designated Rating will
become effective on the date of the change in the Designated Rating. If
the rating system of any Rating Agency shall change, or if either S&P
or Moody's shall cease to be in the business of rating corporate debt
obligations, Borrower and the Agent shall negotiate in good faith if
necessary to amend this definition to reflect such changed rating
system or the unavailability of ratings from such Rating Agencies and,
pending the effectiveness of any such amendment, the Designated Rating
shall be determined by reference to the rating most recently in effect
prior to such change or cessation.
"Master Separation Agreement" means the master separation
agreement, dated as of December 31, 2000, entered into between Reliant
Energy and Unregco providing for, among other things, the Spin-off, as
amended, modified or supplemented from time to time.
"Spin-off" shall have the meaning specified in Schedule 2
attached hereto.
"Supermajority Banks" means, at any time, Banks having at
least 65% of the aggregate Commitments or, if the Commitments have been
terminated, 65% of the aggregate Commitments in effect immediately
prior to such termination.
"Term Loans" has the meaning specified in Section 2.01(e).
"Termination Date" means (a) initially October 10, 2002,
unless the Majority Banks direct in writing on or prior to September 5,
2002 that such Termination Date shall be September 10, 2002, in which
case the Termination Date shall automatically be deemed to be September
10, 2002, or (b) any earlier date on which (i) the Commitments have
been terminated in accordance with this Agreement or (ii) all unpaid
principal amounts of Loans hereunder have become due and payable in
accordance with this Agreement; and
(b) amending the definition of "Consolidated EBITDA" by
deleting "for any period" and substituting in lieu thereof " means, for any
twelve-month period ending on the date of determination".
3. Amendment to Section 2.01 of the Regco Credit Agreement
(The Committed Loans). Section 2.01 of the Credit Agreement is hereby amended
by:
(a) adding at the end of paragraph (a) thereof the following:
"At a reasonable time at least one week prior to September 5,
2002, the Agent shall inquire as to whether requisite Banks
intend to send the written direction referred to in the
definition of Termination Date and shall notify the Borrower
and the Banks if the requisite number of such directives have
been received."; and
(b) adding at the end thereof immediately after paragraph (d)
thereof a new paragraph (e) as follows:
"(e) Notwithstanding anything to the contrary
contained in this Agreement or in the FinanceCo $2.5 Billion
Credit Agreement, upon the effectiveness of this Agreement,
each Bank shall be deemed to have made to the Borrower (i)
term loans in the aggregate principal amount of the aggregate
principal amount of its Term Loan (as defined in the FinanceCo
$2.5 Billion Credit Agreement) outstanding on such date, which
term loans shall be deemed to be term loans (the "Term Loans")
hereunder, and (ii) revolving loans in the aggregate principal
amount of the aggregate principal amount of its Revolving Loan
(as defined in the FinanceCo $2.5 Billion Credit Agreement)
outstanding on such date, which revolving loans shall be
deemed to be revolving loans (the "Revolving Loans") hereunder
and, which shall, together with the corresponding Commitments
(collectively, the "Revolving Facility") retain their
revolving features. Unless Borrower designates a prepayment of
the Loans as a Term Loan prepayment, all prepayments shall be
applied first to outstanding Revolving Loans, and the
Commitments made available thereby may be utilized in
accordance with this Agreement for borrowings, prepayments or
reborrowings and issuances of Letters of Credit, subject to
the conditions of this Agreement applicable thereto. Any
prepayment designated by Borrower as a Term Loan prepayment,
or any prepayment after giving effect to which the aggregate
principal amount of all Loans then outstanding would be less
than the aggregate principal amount of Term Loans outstanding
on the effective date of this Agreement shall, to such extent,
be deemed to be a permanent prepayment of the Term Loans, and
the corresponding Commitments under the Revolving Facility
shall automatically be permanently reduced by the amount
thereof. Each Notice of Borrowing received, and each Loan
made, after July 12, 2002 shall be deemed received and made
under the Revolving Facility. Banks may make assignments,
transfers, novations and delegations of, and sell
participations in, subject to the other provisions of this
Agreement, either or both of its Term Loans and its Revolving
Facility. All references to Loans in this Agreement shall
include the Term Loans and Revolving Loans except to the
extent necessary to effectuate the foregoing".
4. Amendment to Section 4.02 of the Regco Credit Agreement
(Fees). Section 4.02 of the Regco Credit Agreement is hereby amended by:
(a) deleting paragraph (b) thereof in its entirety and
substituting in lieu thereof the following:
"(b) [INTENTIONALLY OMITTED.]"; and
(b) amending paragraph (c) thereof by (i) deleting the phrase
"and Usage Fees"; and (ii) by deleting "Sections 4.02(a) and 4.02(b)" and
substituting in lieu thereof "Section 4.02(a)".
5. Amendment to Section 4.04(a) of the Credit Agreement (ABR
Loans). Section 4.04(a) of the Credit Agreement is hereby amended by adding
immediately after "ABR" in clause (i) therein "plus the Applicable Margin".
6. Amendment to Section 8.02(a) of the Regco Credit Agreement
(Financial Ratio). Section 8.02(a) of the Regco Credit Agreement is hereby
amended by deleting the ratio "4.50:1.00" and substituting in lieu thereof the
ratio "4.75:1.00".
7. Amendment to Section 8.02(g) of the Credit Agreement
(Certain Investments, Loans, Advances, Guarantees and Acquisitions). Section
8.02(g) of the Regco Credit Agreement is hereby amended by adding at the end
thereof the following:
"Notwithstanding the foregoing, Borrower and its
Subsidiaries shall not (x) make any future investments in,
loans to, advances to and Guarantees of any obligations in
Unregco or any of its Subsidiaries or purchase or otherwise
acquire (in one transaction or a series of related
transactions) any assets of Unregco or any of its
Subsidiaries, (y) purchase or otherwise acquire (in one
transaction or a series of related transactions) any assets of
Unregco or any of its Subsidiaries other than, in the case of
this clause (y), any such transactions contemplated by the
Master Separation Agreement and other agreements and
arrangements in respect of the relationship between Reliant
Energy and Unregco described in Reliant Energy's filings with
the SEC or (z) enter into any other transaction constituting
an Investment with Unregco and its Subsidiaries other than, in
the case of this clause (z), the transactions contemplated by
the Master Separation Agreement and other agreements and
arrangements in respect of the relationship between Reliant
Energy and Unregco described in Reliant Energy's filings with
the SEC or other arrangements among Borrower, Unregco and
their respective Subsidiaries in the ordinary course of
business consistent with recent past practices or otherwise at
prices and on terms and conditions not less favorable to
Borrower or its Subsidiaries (other than Unregco and its
Subsidiaries) than could be obtained on an arm's length basis
from unrelated third parties.".
8. Amendment to Article XI of the Credit Agreement
(Miscellaneous). Article XI of the Credit Agreement is hereby amended by:
(a) deleting "or" at the end of clause (ii) of Section 11.01
and substituting in lieu thereof a comma, (b) deleting the period at
the end of clause (iii) thereof and substituting in lieu thereof ", or"
and (c) adding at the end thereof immediately after clause (iii) a new
clause (iv) as follows:
"(iv) amend, modify or waive the last paragraph of
Section 8.02(g) without the written consent of the
Supermajority Banks.";
(b) adding immediately after the first sentence in Section
11.06(c) the following:
"Notwithstanding the foregoing, with respect to the sale by a
Bank of all or any part of its rights and obligations in
respect of the Term Loans, (a) each such sale shall not
require the consent of the Agent, Borrower or any other Bank
or Banks, (b) each such sale that is not to an existing Bank
hereunder shall be in an aggregate amount of not less than
$1,000,000 (or such lesser amount that
represents the aggregate amount of Term Loans of such Bank),
(c) each such sale may be to an Eligible Transferee (as
defined below) and each such Eligible Transferee shall be
deemed to be a Purchasing Bank and a Bank for all purposes
under this Section 11.06(c) and this Agreement and (d) each
such sale shall be consummated pursuant to a Committed Loan
Assignment and Acceptance with such modifications as may be
agreed on by the transferor Bank and the applicable transferee
and consistent with this Section 11.06(c). For purposes of
this Section 11.06(c), "Eligible Transferee" shall mean (w)(i)
any bank or other financial institution, (ii) any insurance or
reinsurance company, (iii) a mutual fund, unit trust or
similar collective investment vehicle (other than an entity
specified in clause (y)(i) below), and (iv) a registered or
licensed broker or dealer (other than a natural person or
proprietorship); provided, however, in the case of each of the
foregoing clauses (i) through (iv), that such entity has total
assets of at least $500,000,000; (x) any Affiliate (as defined
below) of an entity specified in the preceding clause (w); (y)
any corporation, partnership, proprietorship, organization
trust or other entity (i) that is an investment vehicle
(including, without limitation, any hedge fund, issuer of
collateralized debt obligations, commercial paper conduit or
other special purpose vehicle) that (A) has total assets of at
least $100,000,000 or (B) is one of a group of investment
vehicles under common control or management having, in the
aggregate, total assets of at least $100,000,000, (ii) that
has total assets of at least $500,000,000, or (iii) the
obligations of which under an agreement, contract, or
transaction are guaranteed or otherwise supported by a letter
of credit or keepwell, support, or other agreement by an
entity described in clauses (w), (x), (y)(ii) or (z); and (z)
a Sovereign, Sovereign Agency or Supranational Organization
(each as defined below). For purposes of the foregoing
sentence, (a) "Affiliate" means, in relation to a person, any
entity controlled, directly or indirectly, by the person, any
entity that controls, directly or indirectly, the person or
any entity directly or indirectly under common control with
the person, (b) "control" of any entity or person means
ownership of a majority of the voting power of the entity or
person, (c) "Sovereign" means any state, political subdivision
or government, or any agency, instrumentality, ministry,
department or other authority (including, without limiting the
foregoing, the central bank) thereof, (d) "Sovereign Agency"
means any agency, instrumentality, ministry, department or
other authority (including, without limiting the foregoing,
the central bank) of a Sovereign and (e) "Supranational
Organization" means any entity or organization established by
treaty or other arrangement between two or more Sovereigns or
the Sovereign Agencies of two or more Sovereigns and includes,
without limiting the foregoing, the International Monetary
Fund, European Central Bank, International Bank for
Reconstruction and Development and European Bank for
Reconstruction and Development."; and
(c) adding at the end thereof immediately after Section 11.15
a new Section 11.16 as follows:
"Section 11.16. Houston Industries FinanceCo LP as
Co-Obligor. Notwithstanding any provision in this Agreement or
in the FinanceCo $2.5 Billion Credit Agreement to the
contrary, on the Effective Date and thereafter until the
Termination Date, Houston Industries FinanceCo LP shall be a
joint and several obligor with Borrower in respect of all
obligations hereunder.".