EXHIBIT 4.107
EXECUTION COPY
CREDIT AGREEMENT
DATED AS OF FEBRUARY 17, 2004
AMONG
SOUTHWESTERN PUBLIC SERVICE COMPANY
THE LENDERS,
BANK ONE, NA,
AS AGENT,
WELLS FARGO BANK, N.A.,
AS SYNDICATION AGENT,
BANK OF MONTREAL (D/B/A HARRIS NESBITT)
AND
THE BANK OF NEW YORK,
AS CO-DOCUMENTATION AGENTS,
AND
BANC ONE CAPITAL MARKETS, INC. AND WELLS FARGO BANK, N.A.,
AS CO-LEAD ARRANGERS AND BOOK RUNNERS
CREDIT AGREEMENT
This Agreement, dated as of February 17, 2004, is among Southwestern
Public Service Company, the Lenders, Wells Fargo Bank, N.A., as Syndication
Agent, Bank of Montreal (d/b/a Harris Nesbitt) and The Bank of New York, as
Co-Documentation Agents and Bank One, NA, a national banking association having
its principal office in Chicago, Illinois, as Agent. The parties hereto agree as
follows:
ARTICLE I.
DEFINITIONS
As used in this Agreement:
"Accounting Practices Change" means any change in the Borrower's
accounting practices that is permitted or required under the standards of the
Financial Accounting Standards Board.
"Advance" means a borrowing hereunder, (i) made by the Lenders on the
same Borrowing Date, or (ii) converted or continued by the Lenders on the same
date of conversion or continuation, consisting, in either case, of the aggregate
amount of the several Loans of the same Type and, in the case of Eurodollar
Loans, for the same Interest Period.
"Affected Lender" is defined in Section 2.19.
"Affiliate" of any Person means any other Person directly or indirectly
controlling, controlled by or under common control with such Person. A Person
shall be deemed to control another Person if the controlling Person owns 10% or
more of any class of voting securities (or other ownership interests) of the
controlled Person or possesses, directly or indirectly, the power to direct or
cause the direction of the management or policies of the controlled Person,
whether through ownership of stock, by contract or otherwise.
"Agent" means Bank One in its capacity as contractual representative of
the Lenders pursuant to Article X, and not in its individual capacity as a
Lender, and any successor Agent appointed pursuant to Article X.
"Aggregate Commitment" means the aggregate of the Commitments of all
the Lenders, as reduced from time to time pursuant to the terms hereof.
"Aggregate Outstanding Credit Exposure" means, at any time, the
aggregate of the Outstanding Credit Exposure of all Lenders.
"Agreement" means this credit agreement, as it may be amended or
modified and in effect from time to time.
"Alternate Base Rate" means, for any day, a rate of interest per annum
equal to the higher of (i) the Prime Rate for such day and (ii) the sum of the
Federal Funds Effective Rate for such day plus 1/2% per annum.
"Applicable Margin" means, with respect to Eurodollar Advances at any
time, the percentage rate per annum which is applicable at such time with
respect to Eurodollar Advances as set forth in the Pricing Schedule.
"Arranger" means each of Banc One Capital Markets, Inc. and Wells Fargo
Bank, N.A., and their respective successors, in each case in its capacity as a
Co-Lead Arranger and Book Runner.
"Article" means an article of this Agreement unless another document is
specifically referenced.
"Authorized Officer" means any of the following officers of the
Borrower, acting singly: the Chairman of the Board, the Chief Executive Officer,
the Vice Chairman of the Board, the Chief Operating Officer, the President, the
Chief Financial Officer or any Executive Vice President, Senior Vice President,
Vice President, Assistant Vice President, Treasurer or Assistant Treasurer.
"Bank One" means Bank One, NA, a national banking association having
its principal office in Chicago, Illinois, in its individual capacity, and its
successors.
"Borrower" means Southwestern Public Service Company, a New Mexico
corporation, and its successors and assigns.
"Borrowing Date" means a date on which an Advance is made hereunder.
"Borrowing Notice" is defined in Section 2.8.
"Business Day" means (i) with respect to any borrowing, payment or rate
selection of Eurodollar Advances, a day (other than a Saturday or Sunday) on
which banks generally are open in Chicago and New York for the conduct of
substantially all of their commercial lending activities, interbank wire
transfers can be made on the Fedwire system and dealings in United States
dollars are carried on in the London interbank market and (ii) for all other
purposes, a day (other than a Saturday or Sunday) on which banks generally are
open in Chicago for the conduct of substantially all of their commercial lending
activities and interbank wire transfers can be made on the Fedwire system.
"Capitalized Lease" of a Person means any lease of Property by such
Person as lessee, which would be capitalized on a balance sheet of such Person
prepared in accordance with GAAP.
"Capitalized Lease Obligations" of a Person means the amount of the
obligations of such Person under Capitalized Leases which would be shown as a
liability on a balance sheet of such Person prepared in accordance with GAAP.
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"Code" means the Internal Revenue Code of 1986, as amended, reformed or
otherwise modified from time to time.
"Commitment" means, for each Lender, the obligation of such Lender to
make Loans and to participate in Letters of Credit, in an aggregate amount not
exceeding the amount set forth on Schedule II hereto or as set forth in any
assignment that has become effective pursuant to Section 12.3.2, as such amount
may be modified from time to time pursuant to the terms hereof.
"Commitment Fee Rate" means, at any time, the percentage rate per annum
designated as the "Commitment Fee Rate" applicable at such time as set forth in
the Pricing Schedule.
"Contingent Obligation" of a Person means any agreement, undertaking or
arrangement by which such Person assumes, guarantees, endorses, contingently
agrees to purchase or provide funds for the payment of, or otherwise becomes or
is contingently liable upon, the obligation or liability of any other Person, or
agrees to maintain the net worth or working capital or other financial condition
of any other Person, or otherwise assures any creditor of such other Person
against loss, including, without limitation, any comfort letter, operating
agreement, take or pay contract, application for a letter of credit or the
obligations of any such Person as general partner of a partnership with respect
to the liabilities of the partnership.
"Conversion/Continuation Notice" is defined in Section 2.9.
"Controlled Group" means all members of a controlled group of
corporations or other business entities and all trades or businesses (whether or
not incorporated) under common control, which, together with the Borrower or any
of its Subsidiaries, are treated as a single employer under Section 414 of the
Code.
"Credit Extension" means the making of an Advance or the issuance of a
Letter of Credit.
"Debt to Capitalization Ratio" means the ratio of (a) Total Debt to (b)
the sum of (i) Total Debt plus (ii) the sum of common stock, premium on common
stock and retained earnings as shown on the Borrower's consolidated balance
sheet plus, to the extent not included in stockholders' equity, Mandatorily
Redeemable Stock, as determined in accordance with GAAP.
"Default" means an event described in Article VII.
"Environmental Laws" means any and all federal, state, local and
foreign statutes, laws, judicial decisions, regulations, ordinances, rules,
judgments, orders, decrees, plans, injunctions, permits, concessions, grants,
franchises, licenses, agreements and other governmental restrictions relating to
(i) the protection of the environment, (ii) the effect of the environment on
human health, (iii) emissions, discharges or releases of pollutants,
contaminants, hazardous substances or wastes into surface water, ground water or
land, or (iv) the manufacture, processing, distribution, use, treatment,
storage, disposal, transport or handling of pollutants, contaminants, hazardous
substances or wastes or the clean-up or other remediation thereof.
"ERISA" means the Employee Retirement Income Security Act of 1974, as
amended from time to time, and any rule or regulation issued thereunder.
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"Eurodollar Advance" means an Advance which, except as otherwise
provided in Section 2.11, bears interest at the applicable Eurodollar Rate.
"Eurodollar Base Rate" means, with respect to a Eurodollar Advance for
the relevant Interest Period, the applicable British Bankers' Association
Interest Settlement Rate for deposits in U.S. dollars appearing on Reuters
Screen FRBD as of 11:00 a.m. (London time) two Business Days prior to the first
day of such Interest Period, and having a maturity equal to such Interest
Period, provided that (i) if Reuters Screen FRBD is not available to the Agent
for any reason, the applicable Eurodollar Base Rate for the relevant Interest
Period shall instead be the applicable British Bankers' Association Interest
Settlement Rate for deposits in U.S. dollars as reported by any other generally
recognized financial information service as of 11:00 a.m. (London time) two
Business Days prior to the first day of such Interest Period, and having a
maturity equal to such Interest Period, and (ii) if no such British Bankers'
Association Interest Settlement Rate is available to the Agent, the applicable
Eurodollar Base Rate for the relevant Interest Period shall instead be the rate
determined by the Agent to be the rate at which Bank One or one of its Affiliate
banks offers to place deposits in U.S. dollars with first-class banks in the
London interbank market at approximately 11:00 a.m. (London time) two Business
Days prior to the first day of such Interest Period, in the approximate amount
of Bank One's relevant Eurodollar Loan and having a maturity equal to such
Interest Period.
"Eurodollar Loan" means a Loan which, except as otherwise provided in
Section 2.11, bears interest at the applicable Eurodollar Rate.
"Eurodollar Rate" means, with respect to a Eurodollar Advance for the
relevant Interest Period, the sum of (i) the quotient of (a) the Eurodollar Base
Rate applicable to such Interest Period, divided by (b) one minus the Reserve
Requirement (expressed as a decimal) applicable to such Interest Period, plus
(ii) the Applicable Margin.
"Excluded Taxes" means, in the case of each Lender or applicable
Lending Installation and the Agent, taxes imposed on its overall net income, and
franchise taxes imposed on it, by (i) the jurisdiction under the laws of which
such Lender or the Agent is incorporated or organized or (ii) the jurisdiction
in which the Agent's or such Lender's principal executive office or such
Lender's applicable Lending Installation is located.
"Exhibit" refers to an exhibit to this Agreement, unless another
document is specifically referenced.
"Existing Agreement" means the Credit Agreement dated as of February
18, 2003, as amended to the date of this Agreement, among the Borrower, the
lenders party thereto, and Bank One, NA, as agent for said lenders.
"Existing LC" means letter of credit number SLT750771 issued by Issuer
for the account of the Borrower in favor of Southwest Power Pool.
"Facility Termination Date" means February 15, 2005 or any earlier date
on which the Aggregate Commitment is reduced to zero or otherwise terminated
pursuant to the terms hereof.
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"Federal Funds Effective Rate" means, for any day, an interest rate per
annum equal to the weighted average of the rates on overnight Federal funds
transactions with members of the Federal Reserve System arranged by Federal
funds brokers on such day, as published for such day (or, if such day is not a
Business Day, for the immediately preceding Business Day) by the Federal Reserve
Bank of New York, or, if such rate is not so published for any day which is a
Business Day, the average of the quotations at approximately 10:00 a.m. (Chicago
time) on such day on such transactions received by the Agent from three Federal
funds brokers of recognized standing selected by the Agent in its sole
discretion.
"Final Maturity Date" means February 15, 2005.
"Floating Rate" means, for any day, a rate per annum equal to the
Alternate Base Rate for such day.
"Floating Rate Advance" means an Advance which, except as otherwise
provided in Section 2.11, bears interest at the Floating Rate.
"Floating Rate Loan" means a Loan which, except as otherwise provided
in Section 2.11, bears interest at the Floating Rate.
"GAAP" means generally accepted accounting principles as in effect from
time to time applied on a basis consistent with the accounting principles
applied in the financial statements of the Borrower referred to in Section 5.4,
except for changes concurred in by Borrower's independent public accountants and
disclosed in Borrower's financial statements or notes thereto.
"Indebtedness" means, with respect to any Person, all (but without
duplication) of such Person's (i) obligations for borrowed money, (ii)
obligations representing the deferred purchase price of Property or services
(other than accounts payable arising in the ordinary course of such Person's
business payable on terms customary in the trade), (iii) direct or contingent
obligations arising under letters of credit, banker's acceptances, bank
guaranties and similar instruments, (iv) obligations, whether or not assumed,
secured by Liens or payable out of the proceeds or production from Property
owned or acquired by such Person, (v) obligations which are evidenced by bonds,
notes, drafts accepted or other instruments, (vi) Capitalized Lease Obligations,
(vii) net liabilities under Swap Contracts which constitute interest rate
agreements or currency agreements and (viii) Contingent Obligations in respect
of any of the foregoing.
"Interest Period" means, with respect to a Eurodollar Advance, a period
of fourteen days or one, two or three months commencing on a Business Day
selected by the Borrower pursuant to this Agreement. Such Interest Period shall
end on the day fourteen days thereafter or, in the case of an Interest Period of
one, two or, three months, on the day which corresponds numerically to such date
one, two or three months thereafter, provided that if there is no such
numerically corresponding day in such next, second or third succeeding month,
such Interest Period shall end on the last Business Day of such next, second or
third succeeding month. If an Interest Period would otherwise end on a day which
is not a Business Day, such Interest Period shall end on the next succeeding
Business Day, provided that if said next succeeding Business
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Day falls in a new calendar month, such Interest Period shall end on the
immediately preceding Business Day.
"Investment" of a Person means any loan, advance (other than
commission, travel and similar advances to officers and employees made in the
ordinary course of business), extension of credit (other than accounts
receivable arising in the ordinary course of business on terms customary in the
trade) or contribution of capital by such Person.
"Issuer" means Bank One in its capacity as issuer of Letters of Credit
hereunder.
"Lenders" means the lending institutions listed on the signature pages
of this Agreement and their respective successors and assigns.
"Lending Installation" means, with respect to a Lender or the Agent,
the office, branch, subsidiary or affiliate of such Lender or the Agent listed
on its administrative questionnaire or otherwise selected by such Lender or the
Agent pursuant to Section 2.17.
"Letter of Credit" means an Existing LC or a letter of credit issued
pursuant to Section 2.20(i).
"Letter of Credit Application" is defined in Section 2.20(iii).
"Letter of Credit Collateral Account" is defined in Section 2.20(xi).
"Letter of Credit Fee" is defined in Section 2.20(iv).
"Letter of Credit Fee Rate" means, at any time, the percentage rate per
annum applicable to Letter of Credit Fees at such time as set forth in the
Pricing Schedule.
"Letter of Credit Obligations means, at any time, the sum, without
duplication, of (i) the aggregate undrawn stated amount of all Letters of Credit
at such time plus (ii) the aggregate unpaid amount of all Reimbursement
Obligations at such time.
"Letter of Credit Payment Date" is defined in Section 2.20(v).
"Lien" means any lien (statutory or other), mortgage, pledge,
hypothecation, assignment, deposit arrangement, encumbrance or preference,
priority or other security agreement or preferential arrangement of any kind or
nature whatsoever (including, without limitation, the interest of a vendor or
lessor under any conditional sale, Capitalized Lease or other title retention
agreement).
"Loan" means, with respect to a Lender, such Lender's loan made
pursuant to Article II (or any conversion or continuation thereof).
"Loan Documents" means this Agreement, any Notes issued pursuant to
Section 2.13, any Letter of Credit and any Letter of Credit Application.
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"Mandatorily Redeemable Stock" means, with respect to any Person, any
share of such Person's capital stock to the extent that it is (a) redeemable,
payable or required to be purchased or otherwise retired or extinguished, or
convertible into any Indebtedness or other liability of such Person, (i) at a
fixed or determinable date, whether by operation of a sinking fund or otherwise,
(ii) at the option of any Person other than such Person or (iii) upon the
occurrence of a condition not solely within the control of such Person, such as
a redemption required to be made out of future earnings or (b) convertible into
Mandatorily Redeemable Stock.
"Material Adverse Effect" means a material adverse effect on (i) the
business, Property, condition (financial or otherwise) or results of operations
of the Borrower and its Subsidiaries taken as a whole, (ii) the ability of the
Borrower to perform its obligations under the Loan Documents, or (iii) the
validity or enforceability of any of the Loan Documents or the rights or
remedies of the Agent, the Lenders or the Issuer thereunder.
"Material Indebtedness" is defined in Section 7.5.
"Modify" and "Modification" are defined in Section 2.20(i)
"Moody's" means Moody's Investors Service, Inc.
"Multiemployer Plan" means a "multiemployer plan" as defined in Section
4001(a)(3) of ERISA that is subject to Title IV of ERISA and to which the
Borrower or any member of the Controlled Group is obligated to make
contributions.
"Non-U.S. Lender" is defined in Section 3.5(iv).
"Note" means any promissory note issued at the request of a Lender
pursuant to Section 2.13 in the form of Exhibit D.
"Obligations" means all unpaid principal of and accrued and unpaid
interest on the Loans, all Reimbursement Obligations, all accrued and unpaid
fees and all expenses, reimbursements, indemnities and other obligations of the
Borrower to the Lenders or to any Lender, the Agent, the Issuer or any
indemnified party arising under the Loan Documents.
"Off-Balance Sheet Liability" of a Person means (i) any repurchase
obligation or liability of such Person with respect to accounts or notes
receivable sold by such Person, (ii) any liability under any Sale and Leaseback
Transaction which is not a Capitalized Lease and (iii) all Synthetic Lease
Obligations of such Person.
"Outstanding Credit Exposure" means, as to any Lender at any time, the
sum of (i) the aggregate principal amount of its Loans outstanding at such time,
plus (ii) an amount equal to its pro rata share of the Letter of Credit
Obligations at such time.
"Other Taxes" is defined in Section 3.5(ii).
"Participants" is defined in Section 12.2.1.
"Payment Date" means the last day of each March, June, September and
December.
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"PBGC" means the Pension Benefit Guaranty Corporation, or any successor
thereto.
"Person" means any natural person, corporation, firm, joint venture,
partnership, limited liability company, association, enterprise, trust or other
entity or organization, or any government or political subdivision or any
agency, department or instrumentality thereof.
"Plan" means an employee pension benefit plan, other than a
Multiemployer Plan, which is covered by Title IV of ERISA or subject to the
minimum funding standards under Section 412 of the Code as to which the Borrower
or any member of the Controlled Group may have any liability.
"Pricing Schedule" means Schedule I attached hereto identified as such.
"Prime Rate" means a rate per annum equal to the prime rate of interest
announced by Bank One or by its parent, BANK ONE CORPORATION, from time to time,
changing when and as said prime rate changes.
"Property" of a Person means any and all property, whether real,
personal, tangible, intangible, or mixed, of such Person, or other assets owned,
leased or operated by such Person.
"Purchasers" is defined in Section 12.3.1.
"Regulation D" means Regulation D of the Board of Governors of the
Federal Reserve System as from time to time in effect and any successor thereto
or other regulation or official interpretation of said Board of Governors
relating to reserve requirements applicable to member banks of the Federal
Reserve System.
"Regulation U" means Regulation U of the Board of Governors of the
Federal Reserve System as from time to time in effect and any successor or other
regulation or official interpretation of said Board of Governors relating to the
extension of credit by banks for the purpose of purchasing or carrying margin
stocks applicable to member banks of the Federal Reserve System.
"Reimbursement Obligations" means, at any time, the aggregate of all
obligations of the Borrower then outstanding under Section 2.20 to reimburse the
Issuer for amounts paid by the Issuer in respect of any one or more drawings
under Letters of Credit.
"Reportable Event" means a reportable event as defined in Section 4043
of ERISA and the regulations issued under such section, with respect to a Plan
subject to Title IV of ERISA, excluding, however, such events as to which the
PBGC has by regulation waived the requirement of Section 4043(a) of ERISA that
it be notified within 30 days of the occurrence of such event, provided,
however, that a failure to meet the minimum funding standard of Section 412 of
the Code and of Section 302 of ERISA shall be a Reportable Event regardless of
the issuance of any such waiver of the notice requirement in accordance with
either Section 4043(a) of ERISA or Section 412(d) of the Code.
"Required Lenders" means Lenders in the aggregate having more than 50%
of the Aggregate Commitment or, if the Aggregate Commitment has been terminated,
Lenders in the
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aggregate holding more than 50% of the aggregate unpaid principal amount of the
Aggregate Outstanding Credit Exposure.
"Reserve Requirement" means, with respect to an Interest Period, the
maximum aggregate reserve requirement (including all basic, supplemental,
marginal and other reserves) which is imposed under Regulation D on Eurocurrency
liabilities.
"S&P" means Standard and Poor's Ratings Services, a division of The
McGraw Hill Companies, Inc.
"Sale and Leaseback Transaction" means any arrangement, directly or
indirectly, with any Person whereby a seller or transferor shall sell or
otherwise transfer any real or personal property and concurrently therewith
lease, or repurchase under an extended purchase contract, conditional sales or
other title retention agreement, the same or substantially similar property.
"Schedule" refers to a specific schedule to this Agreement, unless
another document is specifically referenced.
"SEC" means the Securities and Exchange Commission.
"Section" means a numbered section of this Agreement, unless another
document is specifically referenced.
"Significant Subsidiary" means, as of any date of determination, each
Subsidiary of the Borrower that meets any of the following criteria:
(i) the Borrower's and its other Subsidiaries'
Investments in and to such Subsidiary (and its respective
Subsidiaries), as shown in the consolidated balance sheet of the
Borrower and its Subsidiaries as of the end of the most recent fiscal
quarter for which financial statements are available as of such date of
determination, exceed 10% of the total consolidated assets of the
Borrower and its Subsidiaries; or
(ii) the assets of such Subsidiary (and its respective
Subsidiaries) represent more than 10% of the consolidated assets of the
Borrower and its Subsidiaries as would be shown in the consolidated
balance sheet referred to in clause (i) above; or
(iii) such Subsidiary (and its respective Subsidiaries) is
responsible for more than 10% of the consolidated net sales or of the
consolidated net income of the Borrower and its Subsidiaries as
reflected in the consolidated financial statements of the Borrower and
its Subsidiaries for the twelve month period ending on the date of the
balance sheet referred to in clause (i) above.
"Subsidiary" of a Person means (i) any corporation more than 50% of the
outstanding securities having ordinary voting power of which shall at the time
be owned or controlled, directly or indirectly, by such Person or by one or more
of its Subsidiaries or by such Person and one or more of its Subsidiaries, or
(ii) any partnership, limited liability company, association, joint venture or
similar business organization more than 50% of the ownership interests having
ordinary voting power of which shall at the time be so owned or controlled.
Unless otherwise
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expressly provided, all references herein to a "Subsidiary" shall mean a
Subsidiary of the Borrower.
"Substantial Portion" means, with respect to the Property of the
Borrower and its Subsidiaries, Property which (i) represents more than 10% of
the consolidated assets of the Borrower and its Subsidiaries as would be shown
in the consolidated balance sheet of the Borrower and its Subsidiaries as of the
end of the most recent quarter for which financial statements are available as
of the date such determination is made, or (ii) is responsible for more than 10%
of the consolidated net sales or of the consolidated net income of the Borrower
and its Subsidiaries as reflected in the consolidated financial statements of
the Borrower and its Subsidiaries for the twelve month period ending on the date
of the balance sheet referred to in clause (i) above.
"Swap Contracts" means any agreement, whether or not in writing,
relating to any transaction that is a rate swap, basis swap, forward rate
transaction, interest rate option, forward foreign exchange transaction, cap,
collar or floor transaction, currency swap, cross-currency rate swap, swaption,
currency option or any other similar transaction (including any option to enter
into any of the foregoing) or any combination of the foregoing, and, unless the
context otherwise clearly requires, any master agreement relating to or
governing any or all of the foregoing.
"Synthetic Lease Obligation" means the monetary obligation of a Person
under (i) a so-called synthetic or off-balance sheet or tax retention lease or
(ii) an agreement for the use or possession of property creating obligations
that do not appear on the balance sheet of such Person but which, upon the
insolvency or bankruptcy of such Person, would be characterized as indebtedness
of such Person (without regard to accounting treatment). The amount of Synthetic
Lease Obligations of any Person under any such lease or agreement shall be the
amount which would be shown as a liability on a balance sheet of such Person
prepared in accordance with GAAP if such lease or agreement were accounted for
as a Capitalized Lease.
"Tangible Net Worth" means shareholders' equity (including preferred
stock), less intangible assets included in calculating such shareholders'
equity, all determined in accordance with GAAP. For purposes of the foregoing
calculation, intangible assets shall include but not be limited to the value of
patents, trademarks, trade names, copyrights, licenses, premiums paid on
indebtedness, good will, prepaid expenses, deferred charges and treasury stock.
Tangible Net Worth with respect to the Borrower shall at all times be determined
with respect to the Borrower and its Subsidiaries on a consolidated basis.
"Taxes" means any and all taxes, duties, levies, imposts, deductions,
charges or withholdings, and any and all liabilities with respect to the
foregoing, but excluding Excluded Taxes and Other Taxes.
"Total Debt" means all Indebtedness of the Borrower and its
Subsidiaries (including Trust Preferred Securities, but excluding Mandatorily
Redeemable Stock), determined on a consolidated basis in accordance with GAAP.
For purposes of calculating Total Debt, obligations under interest rate swaps
and similar arrangements shall be marked to market in accordance with Financial
Accounting Standard 133.
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"Transferee" is defined in Section 12.4.
"Trust Preferred Securities" means preferred stock issued by a trust,
the common equities of which are owned by the Borrower.
"Type" means, with respect to any Advance, its nature as a Floating
Rate Advance or a Eurodollar Advance.
"Unmatured Default" means an event which but for the lapse of time or
the giving of notice, or both, would constitute a Default.
"Utilization Fee Rate" means, at any time, the percentage per annum
designated as the "Utilization Fee Rate" as applicable at such time as set forth
in the Pricing Schedule.
"Wholly-Owned Subsidiary" of a Person means (i) any Subsidiary all of
the outstanding voting securities of which shall at the time be owned or
controlled, directly or indirectly, by such Person or one or more Wholly-Owned
Subsidiaries of such Person, or by such Person and one or more Wholly-Owned
Subsidiaries of such Person, or (ii) any partnership, limited liability company,
association, joint venture or similar business organization 100% of the
ownership interests having ordinary voting power of which shall at the time be
so owned or controlled.
The foregoing definitions shall be equally applicable to both the
singular and plural forms of the defined terms.
ARTICLE II.
THE CREDITS
2.1 Commitment. From and including the date of this Agreement and
prior to the Facility Termination Date, subject to the terms and conditions set
forth in this Agreement, (a) each Lender severally agrees to make Loans to the
Borrower from time to time in amounts not to exceed in the aggregate at any one
time outstanding the amount of its Commitment and (b) the Issuer agrees to issue
Letters of Credit for the account of the Borrower in an aggregate amount not to
exceed $10,000,000 (and each Lender severally agrees to participate in each such
Letter of Credit as more fully set forth in Section 2.20). Subject to the terms
of this Agreement, the Borrower may borrow, repay and reborrow at any time prior
to the Facility Termination Date. The Commitments hereunder shall expire on the
Facility Termination Date. Any repayments of Loans after the Facility
Termination Date may not be reborrowed.
2.2 Required Payments; Maturity. The Aggregate Outstanding Credit
Exposure and all other unpaid Obligations shall be paid in full (or, in the case
of any Letter of Credit, a Letter of Credit Collateral Account shall be
established in accordance with Section 2.20(xi)) by the Borrower on the Final
Maturity Date.
2.3 Ratable Loans. Each Advance hereunder shall consist of Loans
made from the several Lenders ratably in proportion to the ratio that their
respective Commitments bear to the Aggregate Commitment.
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2.4 Types of Advances. The Advances may be Floating Rate Advances
or Eurodollar Advances, or a combination thereof, selected by the Borrower in
accordance with Sections 2.8 and 2.9.
2.5 Commitment Fee; Utilization Fee; Reduction of Aggregate
Commitment; Up-Front Fees.
(i) The Borrower agrees to pay to the Agent for the account of
each Lender a commitment fee at a per annum rate equal to the
Commitment Fee Rate on the daily unused portion of such Lender's
Commitment from the date hereof to and including the Facility
Termination Date, payable on each Payment Date hereafter and on the
Facility Termination Date.
(ii) The Borrower agrees to pay to the Agent for the account
of each Lender a utilization fee at a per annum rate equal to the
Utilization Fee Rate on its Outstanding Credit Exposure for each day on
which the Aggregate Outstanding Credit Exposure exceeds 33-1/3% of the
Aggregate Commitments from the date hereof to and including the
Facility Termination Date, payable on each Payment Date hereafter and
on the Facility Termination Date.
(iii) The Borrower may permanently reduce the Aggregate
Commitment in whole, or in part ratably among the Lenders in integral
multiples of $1,000,000, upon at least three Business Days' written
notice to the Agent, which notice shall specify the amount of any such
reduction, provided that the amount of the Aggregate Commitment may not
be reduced below the Aggregate Outstanding Credit Exposure. All accrued
commitment fees shall be payable on the effective date of any
termination of the obligations of the Lenders to make Loans hereunder.
(iv) The Borrower agrees to pay to the Agent on behalf of each
Lender on the date the Borrower signs this Agreement an up-front fee in
the amount previously agreed upon among the Company, the Agent and such
Lender.
2.6 Minimum Amount of Each Advance. Each Eurodollar Advance shall
be in the minimum amount of $1,000,000 (and in multiples of $100,000 if in
excess thereof), and each Floating Rate Advance shall be in the minimum amount
of $1,000,000 (and in multiples of $100,000 if in excess thereof), provided that
any Floating Rate Advance may be in the amount of the unused Aggregate
Commitment.
2.7 Optional Principal Payments. The Borrower may from time to
time pay, without penalty or premium, all outstanding Floating Rate Advances,
or, in a minimum aggregate amount of $1,000,000 or any integral multiple of
$100,000 in excess thereof, any portion of the outstanding Floating Rate
Advances on any Business Day. The Borrower may from time to time pay, subject to
the payment of any funding indemnification amounts required by Section 3.4 but
without penalty or premium, all outstanding Eurodollar Advances, or, in a
minimum aggregate amount of $1,000,000 or any integral multiple of $100,000 in
excess thereof, any portion of the outstanding Eurodollar Advances upon three
Business Days' prior notice to the Agent.
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2.8 Method of Selecting Types and Interest Periods for New
Advances. The Borrower shall select the Type of Advance and, in the case of each
Eurodollar Advance, the Interest Period applicable thereto from time to time.
The Borrower shall give the Agent irrevocable notice (a "Borrowing Notice") not
later than 10:00 a.m. (Chicago time) on the Borrowing Date of each Floating Rate
Advance and three Business Days before the Borrowing Date for each Eurodollar
Advance, specifying:
(i) the Borrowing Date, which shall be a Business Day, of such
Advance,
(ii) the aggregate amount of such Advance,
(iii) the Type of Advance selected, and
(iv) in the case of each Eurodollar Advance, the Interest Period
applicable thereto.
Not later than noon (Chicago time) on each Borrowing Date, each Lender shall
make available its Loan or Loans in funds immediately available in Chicago to
the Agent at its address specified pursuant to Article XIII. The Agent will make
the funds so received from the Lenders available to the Borrower at the Agent's
aforesaid address.
2.9 Conversion and Continuation of Outstanding Advances. Floating
Rate Advances shall continue as Floating Rate Advances unless and until such
Floating Rate Advances are converted into Eurodollar Advances pursuant to this
Section 2.9 or are repaid in accordance with Section 2.7. Each Eurodollar
Advance shall continue as a Eurodollar Advance until the end of the then
applicable Interest Period therefor, at which time such Eurodollar Advance shall
be automatically converted into a Floating Rate Advance unless (x) such
Eurodollar Advance is or was repaid in accordance with Section 2.7 or (y) the
Borrower shall have given the Agent a Conversion/Continuation Notice (as defined
below) requesting that, at the end of such Interest Period, such Eurodollar
Advance continue as a Eurodollar Advance for the same or another Interest
Period. Subject to the terms of Section 2.6, the Borrower may elect from time to
time to convert all or any part of a Floating Rate Advance into a Eurodollar
Advance. The Borrower shall give the Agent irrevocable notice (a
"Conversion/Continuation Notice") of each conversion of a Floating Rate Advance
into a Eurodollar Advance or continuation of a Eurodollar Advance not later than
10:00 a.m. (Chicago time) at least three Business Days prior to the date of the
requested conversion or continuation, specifying:
(i) the requested date, which shall be a Business Day, of such
conversion or continuation,
(ii) the aggregate amount and Type of the Advance which is to be
converted or continued, and
(iii) the amount of such Advance which is to be converted into or
continued as a Eurodollar Advance and the duration of the
Interest Period applicable thereto.
2.10 Changes in Interest Rate, etc. Each Floating Rate Advance
shall bear interest on the outstanding principal amount thereof, for each day
from and including the date such Advance is made or is automatically converted
from a Eurodollar Advance into a Floating Rate Advance
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pursuant to Section 2.9, to but excluding the date it is paid or is converted
into a Eurodollar Advance pursuant to Section 2.9 hereof, at a rate per annum
equal to the Floating Rate for such day. Changes in the rate of interest on that
portion of any Advance maintained as a Floating Rate Advance will take effect
simultaneously with each change in the Alternate Base Rate. Each Eurodollar
Advance shall bear interest on the outstanding principal amount thereof from and
including the first day of the Interest Period applicable thereto to (but not
including) the last day of such Interest Period or the date it is paid pursuant
to Section 2.7, whichever is earlier, at the interest rate determined by the
Agent as applicable to such Eurodollar Advance based upon the Borrower's
selections under Sections 2.8 and 2.9 and otherwise in accordance with the terms
hereof. No Interest Period may end after the Final Maturity Date.
2.11 Rates Applicable After Default. Notwithstanding anything to
the contrary contained in Section 2.8 or 2.9, during the continuance of a
Default or Unmatured Default the Required Lenders may, at their option, by
notice to the Borrower (which notice may be revoked at the option of the
Required Lenders notwithstanding any provision of Section 8.2 requiring
unanimous consent of the Lenders to changes in interest rates), declare that no
Advance may be made as, converted into or continued as a Eurodollar Advance.
During the continuance of a Default the Required Lenders may, at their option,
by notice to the Borrower (which notice may be revoked at the option of the
Required Lenders notwithstanding any provision of Section 8.2 requiring
unanimous consent of the Lenders to changes in interest rates), declare that (i)
each Eurodollar Advance shall bear interest for the remainder of the applicable
Interest Period at the rate otherwise applicable to such Interest Period plus 2%
per annum, (ii) each Floating Rate Advance shall bear interest at a rate per
annum equal to the Floating Rate in effect from time to time plus 2% per annum
and (iii) the Letter of Credit Fee Rate shall be increased by 2% per annum,
provided that, during the continuance of a Default under Section 7.6 or 7.7, the
interest rates set forth in clauses (i) and (ii) above and the increase in the
Letter of Credit Fee Rate set forth in clause (iii) above shall be applicable to
all applicable Credit Extensions without any election or action on the part of
the Agent or any Lender.
2.12 Method of Payment. All payments of the Obligations hereunder
shall be made, without setoff, deduction, or counterclaim, in immediately
available funds to the Agent at the Agent's address specified pursuant to
Article XIII, or at any other Lending Installation of the Agent specified in
writing by the Agent to the Borrower, by noon (local time) on the date when due
and shall be applied ratably by the Agent among the Lenders. Each payment
delivered to the Agent for the account of any Lender shall be delivered promptly
by the Agent to such Lender in the same type of funds that the Agent received at
its address specified pursuant to Article XIII or at any Lending Installation
specified in a notice received by the Agent from such Lender. The Agent is
hereby authorized to charge the account of the Borrower maintained with Bank One
for each payment of principal, interest, Reimbursement Obligations and fees as
it becomes due hereunder.
2.13 Noteless Agreement; Evidence of Indebtedness. (i) Each Lender
shall maintain in accordance with its usual practice an account or accounts
evidencing the indebtedness of the Borrower to such Lender resulting from each
Loan made by such Lender from time to time, including the amounts of principal
and interest payable and paid to such Lender from time to time hereunder.
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(ii) The Agent shall also maintain accounts in which it will
record (a) the amount of each Loan made hereunder, the Type thereof and
the Interest Period with respect thereto, (b) the amount of any
principal or interest due and payable or to become due and payable from
the Borrower to each Lender hereunder, (c) the original stated amount
of each Letter of Credit and the amount of Letter of Credit Obligations
outstanding at any time and (d) the amount of any sum received by the
Agent hereunder from the Borrower and each Lender's share thereof.
(iii) The entries maintained in the accounts maintained
pursuant to paragraphs (i) and (ii) above shall be prima facie evidence
of the existence and amounts of the Obligations therein recorded;
provided that the failure of the Agent or any Lender to maintain such
accounts or any error therein shall not in any manner affect the
obligation of the Borrower to repay the Obligations in accordance with
their terms.
(iv) Any Lender may request that its Loans be evidenced by a
Note. In such event, the Borrower shall prepare, execute and deliver to
such Lender a Note payable to the order of such Lender. Thereafter, the
Loans evidenced by such Note and interest thereon shall at all times
(including after any assignment pursuant to Section 12.3) be
represented by one or more Notes payable to the order of the payee
named therein or any assignee pursuant to Section 12.3, except to the
extent that any such Lender or assignee subsequently returns any such
Note for cancellation and requests that such Loans once again be
evidenced as described in paragraphs (i) and (ii) above.
2.14 Telephonic Notices. The Borrower hereby authorizes the Lenders
and the Agent to extend, convert or continue Advances, effect selections of
Types of Advances and to transfer funds based on telephonic notices made by any
person or persons the Agent or any Lender in good faith believes to be acting on
behalf of the Borrower, it being understood that the foregoing authorization is
specifically intended to allow Borrowing Notices and Conversion/Continuation
Notices to be given telephonically. The Borrower agrees to deliver promptly to
the Agent a written confirmation, if such confirmation is requested by the Agent
or any Lender, of each telephonic notice signed by an Authorized Officer. If the
written confirmation differs in any material respect from the action taken by
the Agent and the Lenders, the records of the Agent and the Lenders shall govern
absent manifest error.
2.15 Interest Payment Dates; Interest and Fee Basis. Interest
accrued on each Floating Rate Advance shall be payable on each Payment Date,
commencing with the first such date to occur after the date hereof, on any date
on which the Floating Rate Advance is prepaid, whether due to acceleration or
otherwise, and at maturity. Interest accrued on that portion of the outstanding
principal amount of any Floating Rate Advance converted into a Eurodollar
Advance on a day other than a Payment Date shall be payable on the date of
conversion. Interest accrued on each Eurodollar Advance shall be payable on the
last day of its applicable Interest Period, on any date on which the Eurodollar
Advance is prepaid, whether by acceleration or otherwise, and at maturity.
Interest, utilization fees and commitment fees shall be calculated for actual
days elapsed on the basis of a 360-day year, except that interest accruing at
the Prime Rate shall be calculated for actual days elapsed on the basis of a
365, or when appropriate 366, day year. Interest shall be payable for the day an
Advance is made but not for the day of any payment on the amount paid if payment
is received prior to noon (local time) at the place of payment. If any
15
payment of principal of or interest on an Advance shall become due on a day
which is not a Business Day, such payment shall be made on the next succeeding
Business Day and, in the case of a principal payment, such extension of time
shall be included in computing interest in connection with such payment.
2.16 Notification of Advances, Interest Rates, Prepayments and
Commitment Reductions. Promptly after receipt thereof, the Agent will notify
each Lender of the contents of each Aggregate Commitment reduction notice,
Borrowing Notice, Conversion/Continuation Notice, and repayment notice received
by it hereunder. The Agent will notify each Lender of the interest rate
applicable to each Eurodollar Advance promptly upon determination of such
interest rate and will give each Lender prompt notice of each change in the
Alternate Base Rate.
2.17 Lending Installations. Each Lender may book its Loans at any
Lending Installation selected by such Lender and may change its Lending
Installation from time to time. All terms of this Agreement shall apply to any
such Lending Installation and the Loans and any Notes issued hereunder shall be
deemed held by each Lender for the benefit of any such Lending Installation.
Each Lender may, by written notice to the Agent and the Borrower in accordance
with Article XIII, designate replacement or additional Lending Installations
through which Loans will be made by it and for whose account Loan payments are
to be made. If any such replacement or additional Lending Installation is not
incorporated under the laws of the United States or any state thereof, the
relevant Lender shall comply with the provisions of Section 3.5(iv) as to such
Lending Installation.
2.18 Non-Receipt of Funds by the Agent. Unless the Borrower or a
Lender, as the case may be, notifies the Agent prior to the date on which it is
scheduled to make payment to the Agent of (i) in the case of a Lender, the
proceeds of a Loan or (ii) in the case of the Borrower, a payment of principal,
interest or fees to the Agent for the account of the Lenders, that it does not
intend to make such payment, the Agent may assume that such payment has been
made. The Agent may, but shall not be obligated to, make the amount of such
payment available to the intended recipient in reliance upon such assumption. If
such Lender or the Borrower, as the case may be, has not in fact made such
payment to the Agent, the recipient of such payment shall, on demand by the
Agent, repay to the Agent the amount so made available together with interest
thereon in respect of each day during the period commencing on the date such
amount was so made available by the Agent until the date the Agent recovers such
amount at a rate per annum equal to (x) in the case of payment by a Lender, the
Federal Funds Effective Rate for such day for the first three days and,
thereafter, the interest rate applicable to the relevant Loan or (y) in the case
of payment by the Borrower, the interest rate applicable to the relevant Loan.
2.19 Replacement of Lender. If the Borrower is required pursuant to
Section 3.1, 3.2 or 3.5 to make any additional payment to any Lender or if any
Lender's obligation to make or continue, or to convert Floating Rate Advances
into, Eurodollar Advances shall be suspended pursuant to Section 3.3 (any Lender
so affected an "Affected Lender"), the Borrower may elect, if such amounts
continue to be charged or such suspension is still effective, to replace such
Affected Lender as a Lender party to this Agreement, provided that no Default or
Unmatured Default shall have occurred and be continuing at the time of such
replacement, and provided, further, that, concurrently with such replacement,
(i) another bank or other entity which is reasonably satisfactory to the
Borrower and the Agent shall agree, as of such date, to purchase
16
for cash the Advances and other Obligations due to the Affected Lender pursuant
to an assignment substantially in the form of Exhibit B and to become a Lender
for all purposes under this Agreement and to assume all obligations of the
Affected Lender to be terminated as of such date and to comply with the
requirements of Section 12.3 applicable to assignments, and (ii) the Borrower
shall pay to such Affected Lender in same day funds on the day of such
replacement (A) all interest, fees and other amounts then accrued but unpaid to
such Affected Lender by the Borrower hereunder to and including the date of
termination, including without limitation payments due to such Affected Lender
under Sections 3.1, 3.2 and 3.5, and (B) an amount, if any, equal to the payment
which would have been due to such Lender on the day of such replacement under
Section 3.4 had the Loans of such Affected Lender been prepaid on such date
rather than sold to the replacement Lender.
2.20 Letters of Credit.
(i) Issuance. The Issuer hereby agrees, on the terms and
conditions set forth in this Agreement, to issue standby letters of
credit and to renew, extend, increase, decrease or otherwise modify
Letters of Credit ("Modify," and each such action a "Modification")
from time to time from and including the date of this Agreement and
prior to the Facility Termination Date upon the request of the
Borrower; provided that immediately after each such Letter of Credit is
issued or Modified, (i) the aggregate amount of the outstanding LC
Obligations shall not exceed $10,000,000 and (ii) the Aggregate
Outstanding Credit Exposure shall not exceed the Aggregate Commitment.
No Letter of Credit shall have an expiry date later than one year after
the scheduled Facility Termination Date. By their execution of this
Agreement, the Borrower, each Lender, the Issuer and the Agent agree
that, effective as of the date of this Agreement, the Existing LC shall
be a Letter of Credit under this Agreement and subject to the terms
hereof.
(ii) Participations. On the date of this Agreement, with
respect to the Existing LC, and upon the issuance of each other Letter
of Credit or the Modification of any Letter of Credit in accordance
with this Section 2.20, the Issuer shall be deemed, without further
action by any party hereto, to have unconditionally and irrevocably
sold to each Lender, and each Lender shall be deemed, without further
action by any party hereto, to have unconditionally and irrevocably
purchased from the Issuer, a participation in such Letter of Credit
(and each Modification thereof) and the related LC Obligations in
proportion to its pro rata share of the Aggregate Commitment.
(iii) Notice. Subject to Section 2.20(i), the Borrower shall
give the Issuer notice prior to 10:00 a.m. (Chicago time) at least
three Business Days prior to the proposed date of issuance or
Modification of each Letter of Credit, specifying the beneficiary, the
proposed date of issuance (or Modification) and the expiry date of such
Letter of Credit, and describing the proposed terms of such Letter of
Credit and the nature of the transactions proposed to be supported
thereby. Upon receipt of such notice, the Issuer shall promptly notify
the Agent, and the Agent shall promptly notify each Lender, of the
contents thereof and of the amount of such Lender's participation in
such proposed Letter of Credit. The issuance or Modification by the
Issuer of any Letter of Credit shall, in addition to the conditions
precedent set forth in Article IV (the satisfaction of which the Issuer
shall have no duty to ascertain), be subject to the conditions
precedent that such
17
Letter of Credit shall be satisfactory to the Issuer and that the
Borrower shall have executed and delivered such application agreement
and/or such other instruments and agreements relating to such Letter of
Credit as the Issuer shall have reasonably requested (each a "Letter of
Credit Application"). In the event of any conflict between the terms of
this Agreement and the terms of any Letter of Credit Application, the
terms of this Agreement shall control.
(iv) Letter of Credit Fees. The Borrower shall pay to the
Agent, for the account of the Lenders ratably in accordance with their
respective pro rata shares of the Aggregate Commitment, with respect to
each Letter of Credit, a letter of credit fee (the "Letter of Credit
Fee") at a per annum rate equal to the Letter of Credit Fee Rate in
effect from time to time on the undrawn stated amount available under
such Letter of Credit, such fee to be payable in arrears on each
Payment Date. The Borrower shall also pay to the Issuer for its own
account (x) a fronting fee in the amount agreed to by the Issuer and
the Borrower from time to time, with such fee to be payable in arrears
on each Payment Date, and (y) documentary and processing charges in
connection with the issuance or Modification of and draws under Letters
of Credit in accordance with the Issuer's standard schedule for such
charges as in effect from time to time.
(v) Administration; Reimbursement by Lenders. Upon receipt
from the beneficiary of any Letter of Credit of any demand for payment
under such Letter of Credit, the Issuer shall notify the Agent and the
Agent shall promptly notify the Borrower and each other Lender as to
the amount to be paid by the Issuer as a result of such demand and the
proposed payment date (the "Letter of Credit Payment Date"). The
responsibility of the Issuer to the Borrower and each Lender shall be
only to determine that the documents (including each demand for
payment) delivered under each Letter of Credit in connection with such
presentment shall be in conformity in all material respects with such
Letter of Credit. The Issuer shall endeavor to exercise the same care
in its issuance and administration of Letters of Credit as it does with
respect to letters of credit in which no participations are granted, it
being understood that in the absence of any gross negligence or willful
misconduct by the Issuer, each Lender shall be unconditionally and
irrevocably obligated, without regard to the occurrence of any Default
or any condition precedent whatsoever, to reimburse the Issuer on
demand for (i) such Lender's pro rata share (determined by such
Lender's pro rata share of the Aggregate Commitment) of the amount of
each payment made by the Issuer under each applicable Letter of Credit
to the extent such amount is not reimbursed by the Borrower pursuant to
Section 2.20(vi) below, plus (ii) interest on the foregoing amount for
each day from the date of the applicable payment by the Issuer to the
date on which such Lender pays the amount to be reimbursed by it, at a
rate of interest per annum equal to the Federal Funds Effective Rate
or, beginning on third Business Day after demand for such amount by the
Issuer, the rate applicable to Floating Rate Advances.
(vi) Reimbursement by Borrower. The Borrower shall be
irrevocably and unconditionally obligated to reimburse the Issuer on or
before the applicable Letter of Credit Payment Date for any amount to
be paid by the Issuer upon any drawing under any Letter of Credit
issued by the Issuer, without presentment, demand, protest or other
formalities of any kind; provided that the Borrower shall not hereby be
precluded from
18
asserting any claim for direct (but not consequential) damages suffered
by the Borrower to the extent, but only to the extent, caused by (i)
the willful misconduct or gross negligence of the Issuer in determining
whether a request presented under any Letter of Credit issued by it
complied with the terms of such Letter of Credit or (ii) the Issuer's
failure to pay under any Letter of Credit issued by it after the
presentation to it of a request strictly complying with the terms and
conditions of such Letter of Credit. All such amounts paid by the
Issuer and remaining unpaid by the Borrower shall bear interest,
payable on demand, for each day until paid at a rate per annum equal to
the sum of 2% plus the rate applicable to Floating Rate Advances. The
Issuer will pay to each Lender ratably in accordance with its pro rata
share of the Aggregate Commitment all amounts received by it from the
Borrower for application in payment, in whole or in part, of the
Reimbursement Obligation in respect of any Letter of Credit issued by
the Issuer, but only to the extent such Lender has made payment to the
Issuer in respect of such Letter of Credit pursuant to Section 2.20(v).
(vii) Obligations Absolute. The Borrower's obligations under
this Section 2.20 shall be absolute and unconditional under any and all
circumstances and irrespective of any setoff, counterclaim or defense
to payment which the Borrower may have or have had against the Issuer,
any Lender or any beneficiary of a Letter of Credit. The Borrower
further agrees with the Issuer and the Lenders that neither the Issuer
nor any Lender shall be responsible for, and the Borrower's
Reimbursement Obligation in respect of any Letter of Credit shall not
be affected by, among other things, the validity or genuineness of
documents or of any endorsements thereon, even if such documents should
in fact prove to be in any or all respects invalid, fraudulent or
forged, or any dispute between or among the Borrower, any of its
Affiliates, the beneficiary of any Letter of Credit or any financing
institution or other party to whom any Letter of Credit may be
transferred or any claims or defenses whatsoever of the Borrower or of
any of its Affiliates against the beneficiary of any Letter of Credit
or any such transferee. The Issuer shall not be liable for any error,
omission, interruption or delay in transmission, dispatch or delivery
of any message or advice, however transmitted, in connection with any
Letter of Credit. The Borrower agrees that any action taken or omitted
by the Issuer or any Lender under or in connection with any Letter of
Credit and the related drafts and documents, if done without gross
negligence or willful misconduct, shall be binding upon the Borrower
and shall not put the Issuer or any Lender under any liability to the
Borrower. Nothing in this Section 2.20(vii) or Section 2.20(viii) is
intended to limit the right of the Borrower to make a claim against the
Issuer for damages as contemplated by the proviso to the first sentence
of Section 2.20(vi).
(viii) Actions of Issuer. The Issuer shall be entitled to
rely, and shall be fully protected in relying, upon any Letter of
Credit, draft, writing, resolution, notice, consent, certificate,
affidavit, letter, cablegram, telegram, facsimile, telex or teletype
message, statement, order or other document believed by it to be
genuine and correct and to have been signed, sent or made by the proper
Person or Persons, and upon advice and statements of legal counsel,
independent accountants and other experts selected by the Issuer. The
Issuer shall be fully justified in failing or refusing to take any
action under this Agreement unless it shall first have received such
advice or concurrence of the Required Lenders as it reasonably deems
appropriate or it shall first be indemnified to its
19
reasonable satisfaction by the Lenders against any and all liability
and expense which may be incurred by it by reason of taking or
continuing to take any such action. Notwithstanding any other provision
of this Section 2.20, the Issuer shall in all cases be fully protected
in acting, or in refraining from acting, under this Agreement in
accordance with a request of the Required Lenders, and such request and
any action taken or failure to act pursuant thereto shall be binding
upon the Lenders and any future holders of a participation in any
Letter of Credit.
(ix) Indemnification. The Borrower hereby agrees to indemnify
and hold harmless each Lender, the Issuer and the Agent, and their
respective directors, officers, agents and employees, from and against
any and all claims and damages, losses, liabilities, costs or expenses
which such Lender, the Issuer or the Agent may incur (or which may be
claimed against such Lender, the Issuer or the Agent by any Person
whatsoever) by reason of or in connection with the issuance, execution
and delivery or transfer of or payment or failure to pay under any
Letter of Credit or any actual or proposed use of any Letter of Credit,
including, without limitation, any claims, damages, losses,
liabilities, costs or expenses which the Issuer may incur by reason of
or in connection with (i) the failure of any other Lender to fulfill or
comply with its obligations to the Issuer hereunder (but nothing herein
contained shall affect any rights the Borrower may have against any
defaulting Lender) or (ii) by reason of or on account of the Issuer
issuing any Letter of Credit which specifies that the term
"Beneficiary" included therein includes any successor by operation of
law of the named Beneficiary, but which Letter of Credit does not
require that any drawing by any such successor Beneficiary be
accompanied by a copy of a legal document, satisfactory to the Issuer,
evidencing the appointment of such successor Beneficiary; provided that
the Borrower shall not be required to indemnify any Lender, the Issuer
or the Agent for any claims, damages, losses, liabilities, costs or
expenses to the extent, but only to the extent, caused by (x) the
willful misconduct or gross negligence of the Issuer in determining
whether a request presented under any Letter of Credit issued by the
Issuer complied with the terms of such Letter of Credit or (y) the
Issuer's failure to pay under any Letter of Credit after the
presentation to it of a request strictly complying with the terms and
conditions of such Letter of Credit. Nothing in this Section 2.20(ix)
is intended to limit the obligations of the Borrower under any other
provision of this Agreement.
(x) Lenders' Indemnification. Each Lender shall, ratably in
accordance with its pro rata share of the Aggregate Commitment,
indemnify the Issuer, its affiliates and its directors, officers,
agents and employees (to the extent not reimbursed by the Borrower)
against any cost, expense (including reasonable counsel fees and
disbursements), claim, demand, action, loss or liability (except such
as result from such indemnitees' gross negligence or willful misconduct
or the Issuer's failure to pay under any Letter of Credit after the
presentation to it of a request strictly complying with the terms and
conditions of the Letter of Credit) that such indemnitees may suffer or
incur in connection with this Section 2.20 or any action taken or
omitted by such indemnitees hereunder.
(xi) Letter of Credit Collateral Account. The Borrower agrees
that, (i) during the continuance of a Default, upon the request of the
Agent or the Required Lenders, or (ii) on or after the fifth Business
Day preceding the Facility Termination Date and until the
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final expiration date of any Letter of Credit and thereafter as long as
any amount is payable to the Issuer or the Lenders in respect of any
Letter of Credit, it will maintain an amount equal to the stated amount
of the outstanding Letters of Credit in a special collateral account
pursuant to arrangements satisfactory to the Agent (the "Letter of
Credit Collateral Account") at the Agent's office at the address
specified pursuant to Article XIII, in the name of such Borrower but
under the sole dominion and control of the Agent, for the benefit of
the Lenders and in which the Borrower shall have no interest other than
as set forth in Section 8.1. The Borrower hereby pledges, assigns and
grants to the Agent, on behalf of and for the ratable benefit of the
Lenders and the Issuer, a security interest in all of the Borrower's
right, title and interest in and to all funds which may from time to
time be on deposit in the Letter of Credit Collateral Account to secure
the prompt and complete payment and performance of the Obligations. The
Agent will invest any funds on deposit from time to time in the Letter
of Credit Collateral Account in certificates of deposit of Bank One
having a maturity not exceeding 30 days. Nothing in this Section
2.20(xi) shall either obligate the Agent to require the Borrower to
deposit any funds in the Letter of Credit Collateral Account or limit
the right of the Agent to release any funds held in the Letter of
Credit Collateral Account in each case other than as required by
Section 8.1; provided that if one or more Letters of Credit are
outstanding on the fifth Business Day preceding the Facility
Termination Date, the Borrower shall deposit funds in the Letter of
Credit Collateral Account in an amount equal to the stated amount of
all such Letters of Credit. Such account shall at all times that a
Default exists or following the fifth Business Day preceding the
Facility Termination Date have a balance of not less than the stated
amount of the outstanding Letters of Credit.
(xii) Rights as a Lender. In its capacity as a Lender, the
Issuer shall have the same rights and obligations as any other Lender.
ARTICLE III.
YIELD PROTECTION; TAXES
3.1 Yield Protection. If, on or after the date of this Agreement,
the adoption of or any change in any law or any governmental or
quasi-governmental rule, regulation, policy, guideline or directive (whether or
not having the force of law), or any change in the interpretation or
administration thereof by any governmental or quasi-governmental authority,
central bank or comparable agency charged with the interpretation or
administration thereof, or compliance by any Lender, any applicable Lending
Installation or the Issuer with any request or directive (whether or not having
the force of law) of any such authority, central bank or comparable agency:
(i) subjects any Lender, any applicable Lending Installation or
the Issuer to any Taxes, or changes the basis of taxation of
payments (other than with respect to Excluded Taxes) to any
Lender or the Issuer in respect of its Eurodollar Loans,
Letters of Credit or participations therein, or
(ii) imposes or increases or deems applicable any reserve,
assessment, insurance charge, special deposit or similar
requirement against assets of, deposits with or
21
for the account of, or credit extended by, any Lender, any
applicable Lending Installation or the Issuer (other than
reserves and assessments taken into account in determining the
interest rate applicable to Eurodollar Advances), or
(iii) imposes any other condition the result of which is to increase
the cost to any Lender, any applicable Lending Installation or
the Issuer of making, funding or maintaining its Eurodollar
Loans or of issuing or participating in Letters of Credit or
reduces any amount receivable by any Lender, any applicable
Lending Installation or the Issuer in connection with its
Eurodollar Loans or Letters of Credit, or requires any Lender,
any applicable Lending Installation or the Issuer to make any
payment calculated by reference to the amount of Eurodollar
Loans or Letters of Credit held or interest received by it, by
an amount deemed material by such Lender or the Issuer, as the
case may be,
and the result of any of the foregoing is to increase the cost to such Lender,
the applicable Lending Installation or the Issuer of making or maintaining its
Eurodollar Loans, Letters of Credit or Commitment or to reduce the return
received by such Lender, the applicable Lending Installation or the Issuer in
connection with such Eurodollar Loans, Letters of Credit or Commitment, then,
within 15 days after delivery of a written statement pursuant to Section 3.6 to
the Borrower by such Lender or the Issuer, the Borrower shall pay such Lender or
the Issuer such additional amount or amounts as will compensate such Lender or
the Issuer for such increased cost or reduction in amount received.
3.2 Changes in Capital Adequacy Regulations. If a Lender or the
Issuer determines the amount of capital required or expected to be maintained by
such Lender, the Issuer, any Lending Installation of such Lender or any
corporation controlling such Lender or the Issuer is increased as a result of a
Change, then, within 15 days after delivery of a written statement pursuant to
Section 3.6 to the Borrower by such Lender or the Issuer, the Borrower shall pay
such Lender or the Issuer the amount necessary to compensate for any shortfall
in the rate of return on the portion of such increased capital which such Lender
or the Issuer determines is attributable to this Agreement, its Outstanding
Credit Exposure or its Commitment to make Loans and issue or participate in
Letters of Credit, as the case may be, hereunder (after taking into account such
Lender's or the Issuer's policies as to capital adequacy). "Change" means (i)
any change after the date of this Agreement in the Risk-Based Capital Guidelines
or (ii) any adoption of or change in any other law, governmental or
quasi-governmental rule, regulation, policy, guideline, interpretation, or
directive (whether or not having the force of law) after the date of this
Agreement which affects the amount of capital required or expected to be
maintained by any Lender, any Lending Installation or the Issuer or any
corporation controlling any Lender or the Issuer. "Risk-Based Capital
Guidelines" means (i) the risk-based capital guidelines in effect in the United
States on the date of this Agreement, including transition rules, and (ii) the
corresponding capital regulations promulgated by regulatory authorities outside
the United States implementing the July 1988 report of the Basle Committee on
Banking Regulation and Supervisory Practices Entitled "International Convergence
of Capital Measurements and Capital Standards," including transition rules, and
any amendments to such regulations adopted prior to the date of this Agreement.
22
3.3 Availability of Types of Advances. If any Lender determines
that maintenance of its Eurodollar Loans at a suitable Lending Installation
would violate any applicable law, rule, regulation, or directive, whether or not
having the force of law, or if the Required Lenders determine that (i) deposits
of a type and maturity appropriate to match fund Eurodollar Advances are not
available or (ii) the interest rate applicable to Eurodollar Advances does not
accurately reflect the cost of making or maintaining Eurodollar Advances, then
the Agent shall suspend the availability of Eurodollar Advances and require any
affected Eurodollar Advances to be repaid or converted to Floating Rate Advances
(on the date required by such law, rule, regulation or directive, if
applicable), subject to the payment of any funding indemnification amounts
required by Section 3.4.
3.4 Funding Indemnification. If any payment of a Eurodollar
Advance occurs on a date which is not the last day of the applicable Interest
Period, whether because of acceleration, prepayment or otherwise, or a
Eurodollar Advance is not made on the date specified by the Borrower for any
reason other than default by the Lenders, the Borrower will indemnify each
Lender for any loss or cost incurred by it resulting therefrom, including,
without limitation, any loss or cost in liquidating or employing deposits
acquired to fund or maintain such Eurodollar Advance.
3.5 Taxes.
(i) All payments by the Borrower to or for the account of any
Lender, the Issuer or the Agent hereunder or under any Note shall be
made free and clear of and without deduction for any Taxes. If the
Borrower shall be required by law to deduct any Taxes from or in
respect of any sum payable hereunder to any Lender, the Issuer or the
Agent, (a) the sum payable shall be increased as necessary so that
after making all required deductions (including deductions applicable
to additional sums payable under this Section 3.5) such Lender, the
Issuer or the Agent (as the case may be) receives an amount equal to
the sum it would have received had no such deductions been made, (b)
the Borrower shall make such deductions, (c) the Borrower shall pay the
full amount deducted to the relevant authority in accordance with
applicable law and (d) the Borrower shall furnish to the Agent the
original copy of a receipt or other documentation reasonably
satisfactory to the Agent evidencing payment thereof within 30 days
after such payment is made.
(ii) The Borrower shall pay any stamp or documentary taxes and
any excise or property taxes, charges or similar levies which arise
from any payment made hereunder or under any Note or Letter of Credit
Application or from the execution or delivery of, or otherwise with
respect to, this Agreement, any Note or any Letter of Credit
Application ("Other Taxes").
(iii) The Borrower shall indemnify the Agent, each Lender and
the Issuer for the full amount of Taxes or Other Taxes (including,
without limitation, any Taxes or Other Taxes imposed on amounts payable
under this Section 3.5) paid by the Agent, such Lender or the Issuer
and any liability (including penalties, interest and expenses) arising
therefrom or with respect thereto. Payments due under this
indemnification shall be
23
made within 30 days of the date the Agent, such Lender or the Issuer
makes demand therefor pursuant to Section 3.6.
(iv) Each Lender that is not incorporated under the laws of
the United States or a state thereof and each Lender which designates a
Lending Installation which is not incorporated under the laws of the
United States or a state thereof (each a "Non-U.S. Lender") shall, not
less than ten Business Days after the date of this Agreement or the
date of an assignment to such Lender pursuant to Article XII or the
date of designation of such Lending Installation, deliver to each of
the Borrower and the Agent two duly completed copies of United States
Internal Revenue Service Form W-8BEN or W-8ECI, as applicable,
certifying that such Lender is entitled to receive payments under this
Agreement without deduction or withholding of any United States federal
income taxes. Each Non-U.S. Lender shall deliver to each of the
Borrower and the Agent (x) renewals or additional copies of such form
(or any successor form) on or before the date that such form expires or
becomes obsolete, and (y) after the occurrence of any event requiring a
change in the most recent forms so delivered by it, such additional
forms or amendments thereto as may be reasonably requested by the
Borrower or the Agent. All forms or amendments described in the
preceding sentence shall certify that such Lender is entitled to
receive payments under this Agreement without deduction or withholding
of any United States federal income taxes, unless a change in treaty,
law or regulation or any change in the interpretation or administration
thereof by any governmental authority has occurred prior to the date on
which any such delivery would otherwise be required which renders all
such forms inapplicable or which would prevent such Lender from duly
completing and delivering any such form or amendment with respect to it
and such Lender advises the Borrower and the Agent that it is not
capable of receiving payments without any deduction or withholding of
United States federal income tax.
(v) For any period during which a Non-U.S. Lender has failed
to provide the Borrower with an appropriate form pursuant to clause
(iv), above (unless such failure is due to a change in treaty, law or
regulation, or any change in the interpretation or administration
thereof by any governmental authority, occurring subsequent to the date
on which a form originally was required to be provided), such Non-U.S.
Lender shall not be entitled to indemnification or gross-up under this
Section 3.5 with respect to Taxes imposed by the United States;
provided that, should a Non-U.S. Lender which is otherwise exempt from
withholding tax become subject to Taxes because of its failure to
deliver a form required under clause (iv), above, the Borrower shall
take such steps as such Non-U.S. Lender shall reasonably request to
assist such Non-U.S. Lender to recover such Taxes.
(vi) The amount that the Borrower shall be required to pay to
any Lender pursuant to Section 3.5(i) or (ii) shall be reduced by the
amount of any offsetting tax benefit which such Lender receives as a
result of the Borrower's payment to the relevant authorities as
reasonably determined by such Lender; provided, however, that (i) such
Lender shall be the sole judge of the amount of such tax benefit and
the date on which it is received, (ii) no Lender shall be obliged to
disclose information regarding its tax affairs or tax computations,
(iii) nothing herein shall interfere with a Lender's right to manage
its tax affairs in whatever manner it sees fit, and (iv) if such Lender
shall subsequently
24
determine that it has lost the benefit of all or a portion of such tax
benefit, the Borrower shall promptly remit to such Lender the amount
certified by such Lender to be the amount necessary to restore such
Lender to the position it would have been in if no payment had been
made pursuant to this clause (vi).
(vii) If the U.S. Internal Revenue Service or any other
governmental authority of the United States or any other country or any
political subdivision thereof asserts a claim that the Agent or the
Borrower did not properly withhold tax from amounts paid to or for the
account of any Lender (because the appropriate form was not delivered
or properly completed, because such Lender failed to notify the Agent
or the Borrower of a change in circumstances which rendered its
exemption from withholding ineffective, or for any other reason), such
Lender shall indemnify the Agent or the Borrower, as applicable, fully
for all amounts paid, directly or indirectly, by the Agent or the
Borrower, as applicable, as tax, withholding therefor, or otherwise,
including penalties and interest, and including taxes imposed by any
jurisdiction on amounts payable to the Agent or the Borrower, as
applicable, under this subsection, together with all costs and expenses
related thereto (including attorneys fees and time charges of attorneys
for the Agent or the Borrower, as applicable, which attorneys may be
employees of the Agent or the Borrower, as applicable). The obligations
of the Lenders under this Section 3.5(vii) shall survive the payment of
the Obligations and termination of this Agreement.
3.6 Alternate Lending Installation; Lender Statements; Survival of
Indemnity. To the extent reasonably possible, each Lender shall designate an
alternate Lending Installation with respect to its Eurodollar Loans to reduce
any liability of the Borrower to such Lender under Sections 3.1, 3.2 and 3.5 or
to avoid the unavailability of Eurodollar Advances under Section 3.3, so long as
such designation is not, in the judgment of such Lender, disadvantageous to such
Lender. Each Lender, the Issuer and the Agent, as appropriate, shall deliver a
written statement of such Lender to the Borrower (with a copy to the Agent) as
to the amount due, if any, under Section 3.1, 3.2, 3.4 or 3.5. Such written
statement shall set forth in reasonable detail the calculations upon which such
Lender, the Issuer or the Agent determined such amount and shall be final,
conclusive and binding on the Borrower in the absence of manifest error.
Determination of amounts payable under such Sections in connection with a
Eurodollar Loan shall be calculated as though each Lender funded its Eurodollar
Loan through the purchase of a deposit of the type and maturity corresponding to
the deposit used as a reference in determining the Eurodollar Rate applicable to
such Loan, whether in fact that is the case or not. Unless otherwise provided
herein, the amount specified in the written statement of any Lender, the Issuer
or the Agent shall be payable on demand after receipt by the Borrower of such
written statement. The obligations of the Borrower under Sections 3.1, 3.2, 3.4
and 3.5 shall survive payment of the Obligations and termination of this
Agreement.
3.7 ERISA Representations. Each Lender represents and warrants to
the Borrower that neither the Commitment nor any part of the funds, monies,
assets or other considerations to be used for the funding of any Loan or Letter
of Credit issued by it shall constitute "plan assets" as defined in ERISA and
that the rights, benefits and interests of the Lender under the Loan Documents
will not be "plan assets" under ERISA.
25
ARTICLE IV.
CONDITIONS PRECEDENT
4.1 Initial Credit Extension. The Lenders and the Issuer shall not
be required to make the initial Credit Extension hereunder unless the Borrower
has furnished to the Agent with sufficient copies for the Lenders:
(i) Copies of the articles or certificate of incorporation of the
Borrower, together with all amendments, and a certificate of
good standing, each certified by the appropriate governmental
officer in its jurisdiction of incorporation.
(ii) Copies certified by the Secretary or Assistant Secretary of
the Borrower, of its by-laws and of its Board of Directors'
resolutions and of resolutions or actions of any other body
authorizing the execution of the Loan Documents to which the
Borrower is a party.
(iii) An incumbency certificate, executed by the Secretary or
Assistant Secretary of the Borrower, which shall identify by
name and title and bear the signatures of the officers of the
Borrower authorized to sign the Loan Documents to which the
Borrower is a party, upon which certificate the Agent and the
Lenders shall be entitled to rely until informed of any change
in writing by the Borrower.
(iv) Evidence, in form and substance satisfactory to the Agent,
that the Borrower has obtained all governmental approvals
necessary for it to enter into the Loan Documents.
(v) A certificate, signed by an Authorized Officer of the
Borrower, stating that on the initial Borrowing Date no
Default or Unmatured Default has occurred and is continuing.
(vi) Written opinions of the Borrower's counsel, addressed to the
Lenders in substantially the form of Exhibit A-1 and Exhibit
A-2.
(vii) Any Notes requested by a Lender pursuant to Section 2.13
payable to the order of each such requesting Lender.
(viii) Written money transfer instructions, in substantially the form
of Exhibit C, addressed to the Agent and signed by an
Authorized Officer, together with such other related money
transfer authorizations as the Agent may have reasonably
requested.
(ix) Evidence, in form and substance satisfactory to the Agent, of
the termination of the Existing Agreement and the repayment in
full of all outstanding obligations of the Borrower thereunder
(it being understood that the Existing LC shall become a
Letter of Credit hereunder on the date of this Agreement).
26
(x) If the initial Credit Extension will be the issuance of a
Letter of Credit, a properly completed Letter of Credit
Application.
(xi) Such other documents as any Lender or its counsel may have
reasonably requested.
4.2 Each Credit Extension. The Lenders shall not be required to
make any Credit Extension unless on the applicable Borrowing Date:
(i) There exists no Default or Unmatured Default.
(ii) The representations and warranties contained in Article V are
true and correct as of such Borrowing Date except to the
extent any such representation or warranty is stated to relate
solely to an earlier date, in which case such representation
or warranty shall have been true and correct on and as of such
earlier date.
Each Borrowing Notice and each request for the issuance of a Letter of
Credit shall constitute a representation and warranty by the Borrower that the
conditions contained in Sections 4.2(i) and (ii) have been satisfied.
ARTICLE V.
REPRESENTATIONS AND WARRANTIES
The Borrower represents and warrants to the Lenders that:
5.1 Existence and Standing. Each of the Borrower and its
Subsidiaries is a corporation, partnership or limited liability company duly and
properly incorporated or organized, as the case may be, validly existing and (to
the extent such concept applies to such entity) in good standing under the laws
of its jurisdiction of incorporation or organization and has all requisite
authority to conduct its business in each jurisdiction in which its business is
conducted.
5.2 Authorization and Validity. The Borrower has the corporate
power and authority and legal right to execute and deliver the Loan Documents
and to perform its obligations thereunder. The execution and delivery by the
Borrower of the Loan Documents and the performance of its obligations thereunder
have been duly authorized by proper corporate proceedings. After giving effect
to each Credit Extension hereunder, the aggregate amount of all Indebtedness and
borrowings of the Borrower will not exceed the maximum amount of Indebtedness
and borrowings authorized by the Borrower's Board of Directors. The Loan
Documents constitute legal, valid and binding obligations of the Borrower
enforceable against the Borrower in accordance with their terms, except as
enforceability may be limited by bankruptcy, insolvency or similar laws
affecting the enforcement of creditors' rights generally and general principles
of equity.
5.3 No Conflict; Government Consent. Neither the execution and
delivery by the Borrower of the Loan Documents, nor the consummation of the
transactions therein contemplated, nor compliance with the provisions thereof
will violate (i) any law, rule,
27
regulation, order, writ, judgment, injunction, decree or award binding on the
Borrower or any of its Subsidiaries, or (ii) the Borrower's or any Subsidiary's
articles or certificate of incorporation, partnership agreement, certificate of
partnership, articles or certificate of organization, bylaws, or operating or
other management agreement, as the case may be, or (iii) the provisions of any
indenture, loan or credit agreement or other material instrument, lease or
agreement to which the Borrower or any of its Subsidiaries is a party or is
subject, or by which it, or its Property, is bound, or conflict with or
constitute a default thereunder, or result in, or require, the creation or
imposition of any Lien in, of or on the Property of the Borrower or a Subsidiary
pursuant to the terms of any such indenture, instrument or agreement. No order,
consent, adjudication, approval, license, authorization, or validation of, or
filing, recording or registration with, or exemption by, or other action in
respect of any governmental or public body or authority, or any subdivision
thereof, which has not been obtained by the Borrower or any of its Subsidiaries
and is in full force and effect, is required to be obtained by the Borrower or
any of its Subsidiaries in connection with the execution and delivery of the
Loan Documents, the borrowings under this Agreement, the payment and performance
by the Borrower of the Obligations or the legality, validity, binding effect or
enforceability of any of the Loan Documents, except that the Borrower is
required to make a notice filing with the SEC pursuant to the Public Utility
Holding Company Act of 1935, as amended. The Borrower covenants that it will
make the notice filing referred to in the preceding sentence within the time
limit prescribed therefor and further represents that no further consent,
approval, license, authorization or validation of the SEC is required in
connection therewith.
5.4 Financial Statements. The September 30, 2003 consolidated
financial statements of the Borrower and its Subsidiaries heretofore delivered
to the Lenders were prepared in accordance with generally accepted accounting
principles in effect on the date such statements were prepared and fairly
present the consolidated financial condition and operations of the Borrower and
its Subsidiaries at such date and the consolidated results of their operations
for the period then ended.
5.5 Material Adverse Change. Since September 30, 2003 no event has
occurred which could reasonably be expected to have a Material Adverse Effect.
5.6 Taxes. The Borrower and its Subsidiaries have filed all United
States federal tax returns and all other tax returns which are required to be
filed and have paid all taxes due pursuant to said returns or pursuant to any
assessment received by the Borrower or any of its Subsidiaries, except such
taxes, if any, (i) where the failure to pay such tax, assessment, charge or
claim could not reasonably be expected to result in a liability in excess of
$10,000,000 or (ii) which are being contested in good faith and as to which
adequate reserves have been provided in accordance with GAAP. The United States
income tax returns of the Borrower and its Subsidiaries have been audited by the
Internal Revenue Service through the fiscal year ended July 31, 1997. The
charges, accruals and reserves on the books of the Borrower and its Subsidiaries
in respect of any taxes or other governmental charges are in accordance with
GAAP.
5.7 Litigation and Contingent Obligations. Except as described on
Schedule 5.7 or in the Borrower's annual report on Form 10-K for the year ended
December 31, 2002 and the Borrower's quarterly reports on Form 10-Q for the
periods ended March 31, 2003, June 30, 2003
28
and September 30, 2003, there is no litigation, arbitration, governmental
investigation, proceeding or inquiry pending or, to the knowledge of any of
their officers, threatened against or affecting the Borrower or any of its
Subsidiaries which could reasonably be expected to have a Material Adverse
Effect or which seeks to prevent, enjoin or delay the making of any Loans. Other
than any liability incident to any litigation, arbitration or proceeding which
could not reasonably be expected to have a Material Adverse Effect, the Borrower
has no material contingent obligations not provided for or disclosed in the
financial statements referred to in Section 5.4.
5.8 Subsidiaries. As of the date of this Agreement, the Borrower
has no Subsidiaries.
5.9 ERISA. No Plan will have an accumulated funding deficiency (as
such term is defined in Section 302 of ERISA) in excess of $50,000,000 as of the
last day of the most recent fiscal year of such Plan ended prior to the date
hereof, and no liability to PBGC or the Internal Revenue Service in excess of
such amount has been, or is expected by the Borrower or any other member of the
Controlled Group to be, incurred with respect to any Plan that could become a
liability of the Borrower.
5.10 Accuracy of Information. The information, exhibits and
reports, taken as a whole, furnished by the Borrower or any of its Subsidiaries
to the Agent and the Lenders in connection with the negotiation of, or
compliance with, the Loan Documents do not contain any material misstatement of
fact or omit to state a material fact necessary to make the statements contained
therein, in light of the circumstances under which they were made, not
misleading.
5.11 Regulation U. Margin stock (as defined in Regulation U)
constitutes less than 25% of the value of those assets of the Borrower and its
Subsidiaries which are subject to any limitation on sale, pledge, or other
restriction hereunder.
5.12 Material Agreements. Neither the Borrower nor any Subsidiary
is a party to any agreement or instrument or subject to any charter or other
corporate restriction which could reasonably be expected to have a Material
Adverse Effect. Neither the Borrower nor any Subsidiary is in default in the
performance, observance or fulfillment of any of the obligations, covenants or
conditions contained in (i) any agreement to which it is a party, which default
could reasonably be expected to have a Material Adverse Effect or (ii) any
agreement or instrument evidencing or governing Indebtedness.
5.13 Compliance With Laws. The Borrower and its Subsidiaries have
complied in all material respects with all applicable statutes, rules,
regulations, orders and restrictions of any domestic or foreign government or
any instrumentality or agency thereof having jurisdiction over the conduct of
their respective businesses or the ownership of their respective Property.
5.14 Plan Assets; Prohibited Transactions. The Borrower is not an
entity deemed to hold "plan assets" within the meaning of 29 C.F.R. Section
2510.3-101 of an employee benefit plan (as defined in Section 3(3) of ERISA)
which is subject to Title I of ERISA or any plan (within the meaning of Section
4975 of the Code), and, assuming the accuracy of the representations and
warranties made in Section 3.7 and in any assignment pursuant to Section 12.3,
neither the
29
execution of this Agreement nor the making of Loans hereunder gives rise to a
non-exempt prohibited transaction within the meaning of Section 406 of ERISA or
Section 4975 of the Code.
5.15 Environmental Matters. In the ordinary course of its business,
the officers of the Borrower consider the effect of Environmental Laws on the
business of the Borrower and its Subsidiaries, in the course of which they
identify and evaluate potential risks and liabilities accruing to the Borrower
due to Environmental Laws. On the basis of this consideration, except as
disclosed on Schedule 5.15, the Borrower has concluded that Environmental Laws
cannot reasonably be expected to have a Material Adverse Effect. Except as
disclosed on Schedule 5.15, neither the Borrower nor any Subsidiary has received
any notice to the effect that its operations are not in material compliance with
any of the requirements of applicable Environmental Laws or are the subject of
any federal or state investigation evaluating whether any remedial action is
needed to respond to a release of any toxic or hazardous waste or substance into
the environment, which noncompliance or remedial action could reasonably be
expected to have a Material Adverse Effect.
5.16 Investment Company Act. Neither the Borrower nor any
Subsidiary is an "investment company" or a company "controlled" by an
"investment company", within the meaning of the Investment Company Act of 1940,
as amended.
5.17 Public Utility Holding Company Act. The Borrower is a
subsidiary of Xcel Energy Inc., which is a "holding company" registered under
the Public Utility Holding Company Act of 1935, as amended ("PUHCA"). The
transactions contemplated by this Agreement are exempt from any requirement for
SEC approval under PUHCA.
5.18 Insurance. The Borrower and its Subsidiaries maintain a
self-insurance program and maintain with financially sound and reputable
insurance companies insurance on all their Property of a character usually
insured by entities in the same or similar businesses similarly situated against
loss or damage of the kinds and in the amounts, customarily insured against by
such entities, and maintain such other insurance as is usually carried by such
entities.
ARTICLE VI.
COVENANTS
During the term of this Agreement, unless the Required Lenders shall
otherwise consent in writing:
6.1 Financial Reporting. The Borrower will maintain, for itself
and each Subsidiary, a system of accounting established and administered in
accordance with GAAP, and furnish to the Lenders:
(i) Within 90 days after the close of each of its fiscal years, an
unqualified (except for (x) qualifications relating to changes
in accounting principles or practices reflecting changes in
generally accepted accounting principles and required or
approved by the Borrower's independent certified public
accountants and (y) references to audits for prior years
having been conducted by other auditors) audit report
certified by nationally recognized independent certified
public accountants,
30
prepared in accordance with GAAP on a consolidated basis for
itself and its Subsidiaries, including balance sheets as of
the end of such period, a statement of operations, a statement
of stockholder's equity and a statement of cash flows,
accompanied by any management letter prepared by said
accountants.
(ii) Within 45 days after the close of the first three quarterly
periods of each of its fiscal years, on a consolidated basis
for itself and its Subsidiaries, unaudited balance sheet as at
the close of each such period, a statement of operations and
statement of cash flows for the period from the beginning of
such fiscal year to the end of such quarter, all prepared in
accordance with GAAP and certified by an Authorized Officer.
(iii) As soon as possible and in any event within 10 days after the
Borrower knows that any Reportable Event has occurred which
could reasonably be expected to have a Material Adverse
Effect, a statement, signed by an Authorized Officer,
describing said Reportable Event and the action which the
Borrower proposes to take with respect thereto.
(iv) Promptly upon their receipt, copies of (a) all notices
received by the Borrower or any other member of the Controlled
Group of PBGC's intent to terminate any Plan or to have a
trustee appointed to administer any Plan, and (b) all notices
received by the Borrower or any other member of the Controlled
Group from a Multiemployer Plan concerning the imposition or
amount of withdrawal liability imposed pursuant to Section
4202 of ERISA, which withdrawal liability individually or in
the aggregate exceeds $50,000,000.
(v) As soon as possible and in any event within 10 days after
receipt by the Borrower, a copy of (a) any notice or claim to
the effect that the Borrower or any of its Subsidiaries is or
may be liable to any Person as a result of the release by the
Borrower, any of its Subsidiaries, or any other Person of any
toxic or hazardous waste or substance into the environment,
and (b) any notice alleging any violation of any federal,
state or local environmental, health or safety law or
regulation by the Borrower or any of its Subsidiaries, which,
in either case, could reasonably be expected to have a
Material Adverse Effect.
(vi) Promptly upon the filing thereof, copies of all registration
statements and annual, quarterly, monthly or other regular
reports which the Borrower or any of its Subsidiaries files
with the SEC.
(vii) Together with the annual and quarterly reports referred to in
clauses (i) and (ii) above, a certificate in the form of
Exhibit E, certified by an Authorized Officer.
(viii) Such other information (including non-financial information)
as the Agent or any Lender may from time to time reasonably
request.
6.2 Use of Proceeds. The Borrower will, and will cause each
Subsidiary to, use the proceeds of the Credit Extensions for general corporate
purposes and to repay outstanding Credit Extensions. The Borrower will not, nor
will it permit any Subsidiary to, use any of the proceeds
31
of the Credit Extensions to purchase or carry any "margin stock" (as defined in
Regulation U) or to make any acquisition of any corporation, partnership,
limited liability company or other business entity unless, prior to making such
acquisition, the Borrower or such Subsidiary shall have obtained written
approval from the board of directors or other governing body of such entity.
6.3 Notice of Default. The Borrower will, and will cause each
Subsidiary to, give prompt notice in writing to the Lenders within five (5) days
of any Authorized Officer obtaining actual knowledge of the occurrence of any
Default or Unmatured Default and of any other development, financial or
otherwise, which could reasonably be expected to have a Material Adverse Effect
(it being understood and agreed that the Borrower and its Subsidiaries shall not
be required to make separate disclosure under this Section 6.3 of occurrences or
developments which have previously been disclosed to the Lenders in any
financial statements or other information delivered to the Lenders pursuant to
Section 6.1).
6.4 Conduct of Business. The Borrower will, and will cause each
Subsidiary to, carry on and conduct its business in substantially the same
manner and in substantially the same fields of enterprise as it is presently
conducted and, except as otherwise permitted by Section 6.10 or Section 6.11, do
all things necessary to remain duly incorporated or organized, validly existing
and (to the extent such concept applies to such entity) in good standing as a
domestic corporation, partnership or limited liability company in its
jurisdiction of incorporation or organization, as the case may be, and maintain
all requisite authority to conduct its business in each jurisdiction in which
its business is conducted, except where the failure to be in good standing could
not reasonably be expected to have a Material Adverse Effect.
6.5 Taxes. The Borrower will, and will cause each Subsidiary to,
timely file complete and correct United States federal and applicable foreign,
state and local tax returns required by law and pay when due all taxes,
assessments and governmental charges and levies upon it or its income, profits
or Property, except those (i) where failure to pay such tax, assessment, charge
or claim could not reasonably be expected to result in a liability in excess of
$10,000,000 or (ii) which are being contested in good faith by appropriate
proceedings and with respect to which adequate reserves have been set aside in
accordance with GAAP.
6.6 Insurance. The Borrower will, and will cause each Subsidiary
to, maintain a self-insurance program, and maintain with financially sound and
reputable insurance companies insurance on all their Property in such amounts
and covering such risks as is consistent with sound business practice, and the
Borrower will furnish to any Lender upon request full information as to the
insurance carried.
6.7 Compliance with Laws. The Borrower will, and will cause each
Subsidiary to, comply with all laws, rules, regulations, orders, writs,
judgments, injunctions, decrees or awards to which it may be subject including,
without limitation, all Environmental Laws, where failure to do so could
reasonably be expected to have a Material Adverse Effect.
6.8 Maintenance of Properties. The Borrower will, and will cause
each Subsidiary to, do all things necessary to maintain, preserve, protect and
keep its Property necessary or useful in the conduct of its business in good
repair, working order and condition, and make all necessary
32
and proper repairs, renewals and replacements so that its business carried on in
connection therewith may be properly conducted at all times.
6.9 Inspection. The Borrower will, and will cause each Subsidiary
to, permit the Agent and the Lenders, by their respective representatives and
agents, to inspect any of the Property (subject to such physical security
requirements as the Borrower or the applicable Subsidiary may reasonably
impose), books and financial records of the Borrower and each Subsidiary, to
examine and make copies of the books of accounts and other financial records of
the Borrower and each Subsidiary (except to the extent that such access is
restricted by law or by a bona fide non-disclosure agreement not entered into
primarily for the purpose of evading the requirements of this Section), and to
discuss the affairs, finances and accounts of the Borrower and each Subsidiary
with, and to be advised as to the same by, their respective officers at such
reasonable times and intervals as the Agent or any Lender may designate.
6.10 Merger. The Borrower will not, nor will it permit any
Subsidiary to, merge or consolidate with or into any other Person, except that,
so long as both immediately prior to and after giving effect to such merger or
consolidation, no Default or Unmatured Default shall have occurred and be
continuing, then (i) any Subsidiary may merge with the Borrower or a
Wholly-Owned Subsidiary, (ii) the Borrower may merge or consolidate with any
other Person so long as the Borrower is the surviving entity and (iii) a
Subsidiary may merge into any other corporation if after giving effect thereto
the survivor is no longer a Subsidiary of the Borrower and the assets of such
Subsidiary could have been sold pursuant to the provisions of Section 6.11 if
such transaction were treated as a disposition of the assets of such Subsidiary.
6.11 Sale of Assets. The Borrower will not, nor will it permit any
Subsidiary to, lease, sell or otherwise dispose of its Property to any other
Person, except:
(i) Sales of inventory in the ordinary course of business;
(ii) Leases, sales or other dispositions of Property no longer used
or useful in the business of the Borrower or any Subsidiary;
(iii) Leases, sales or other dispositions of Property the net
proceeds of which are invested or re-invested, or held in cash
or cash-equivalents for reinvestment in other energy-related
assets; or
(iv) Leases, sales or other dispositions of its Property that,
together with all other Property of the Borrower and its
Subsidiaries previously leased, sold or disposed of (other
than Property leased, sold or disposed of pursuant to clauses
(i), (ii) and (iii) above) as permitted by this clause during
the twelve-month period ending with the month in which any
such lease, sale or other disposition occurs, do not
constitute a Substantial Portion of the Property of the
Borrower and its Subsidiaries.
provided, however, that a Subsidiary of the Borrower may sell, lease, or
transfer all or a substantial part of its assets to the Borrower or a
Wholly-Owned Subsidiary and any such sale, lease or transfer shall not be
included in determining if the Borrower and/or its Subsidiaries disposed of a
Substantial Portion of its Property. Notwithstanding the foregoing, the
operating
33
agreement between TRANSLink Transmission Co., LLC and the Borrower shall not be
treated as a sale, lease or other disposition of Property for the purposes of
this Section 6.11.
6.12 Debt to Capitalization Ratio. The Borrower will not at any
time permit the Debt to Capitalization Ratio to be greater than 0.60 to 1.00.
6.13 Liens. The Borrower will not, nor will it permit any
Subsidiary to, create, incur, or suffer to exist any Lien in, of or on the
Property of the Borrower or any of its Subsidiaries, except:
(a) Liens for taxes, assessments or governmental charges or levies on
its Property if the same shall not at the time be delinquent or thereafter can
be paid without penalty, or are being contested in good faith and by appropriate
proceedings and for which adequate reserves in accordance with GAAP shall have
been set aside on its books.
(b) Liens imposed by law, such as carriers', warehousemen's and
mechanics' liens and other similar liens arising in the ordinary course of
business which secure payment of obligations not more than 60 days past due or
which are being contested in good faith by appropriate proceedings and for which
adequate reserves shall have been set aside on its books.
(c) Liens arising out of pledges or deposits under worker's
compensation laws, unemployment insurance, old age pensions, or other social
security or retirement benefits, or similar legislation.
(d) Utility easements, building restrictions and such other
encumbrances or charges against real property as are of a nature generally
existing with respect to properties of a similar character and which do not in
any material way affect the marketability of the same or interfere with the use
thereof in the business of the Borrower or its Subsidiaries.
(e) Liens existing on the date hereof and described in Schedule 6.13.
(f) Liens upon or in property acquired after the date hereof created
solely for the purpose of securing indebtedness incurred to fund the purchase
price of such property, provided that (i) such Lien is created not later than
the 90th day following the acquisition or completion of construction of such
property by the Borrower or its applicable Subsidiary, and (ii) no such Lien
extends or shall extend to or cover any property of the Borrower or its
Subsidiaries other than the property then being acquired, fixed improvements
then or thereafter erected thereon and improvements and modifications thereto
necessary to maintain such properties in working order.
(g) Liens existing on property or assets at the time of acquisition
thereof by the Borrower or a Subsidiary, provided that (i) such Liens existed at
the time of such acquisition and were not created in anticipation thereof, and
(ii) any such Lien does not encumber any other property or assets (other than
additions thereto and property in replacement or substitution thereof).
(h) Liens existing on property or assets of a Person which becomes a
Subsidiary of the Borrower; provided that (i) such Liens existed at the time
such Person became a Subsidiary and were not created in anticipation thereof,
and (ii) any such Lien does not encumber any other
34
property or assets (other than additions thereto and property in replacement or
substitution thereof).
(i) Liens securing any refinancing of indebtedness secured by the Liens
described in paragraphs (e), (f), (g) and (h), so long as the amount of such
indebtedness secured by any such Lien does not exceed the amount of such
refinanced indebtedness immediately prior to the refinancing and Liens do not
extend to assets other than those encumbered prior to such refinancing and
improvements and modifications thereto.
(j) Liens granted by any Subsidiary of the Borrower in favor of the
Borrower or any Wholly-Owned Subsidiary of the Borrower.
(k) Liens arising by reason of any judgment, decree or order of any
court or other governmental authority that would not constitute an Event of
Default.
(l) Leases and subleases of Property owned or leased by the Borrower or
any Subsidiary not interfering with the ordinary conduct of the business of the
Borrower and its Subsidiaries; provided that such leases and subleases comply
with Section 6.11.
(m) Liens arising by virtue of any statutory of common law provision
relating to banker's liens, rights of setoff or similar rights as to deposit
accounts or other funds maintained with a creditor depository institution.
(n) Liens securing the Obligations.
(o) Liens not otherwise described in this Section 6.13, so long as the
aggregate amount of indebtedness secured by all such Liens does not at any time
exceed 10% of the Tangible Net Worth of the Borrower and its Subsidiaries.
6.14 Intercompany Transactions. The Borrower will not, and will not
permit any Subsidiary to, (a) make any loan or advance to, or any investment in,
Xcel Energy Inc. or any Affiliate thereof (other than the Borrower or any
Subsidiary thereof); or (b) enter into any other transaction with Xcel Energy
Inc. or any Affiliate thereof (other than the Borrower or any Subsidiary
thereof) except: (i) upon fair and reasonable terms no less favorable to the
Borrower or such Subsidiary than the Borrower or such Subsidiary would obtain in
a comparable arms' length transaction with unrelated third parties; (ii)
dividends paid to Xcel Energy, Inc.; (iii) transactions with Affiliates which
transactions are subject to the jurisdiction of the Federal Energy Regulatory
Commission ("FERC"), the SEC or the Public Utilities Commission of the State of
New Mexico; (iv) allocation of taxes, tax benefits and tax credits in accordance
with the restrictions and requirements of the Public Utility Holding Company Act
of 1935, as amended; (v) contributions of capital to its Subsidiaries; and (vi)
any investment in TRANSLink Transmission Co., LLC ("TRANSLink") or any operating
agreement between TRANSLink and the Borrower or its Subsidiaries, complying with
the requirements of FERC Order No. 2000.
6.15 Off-Balance Sheet Liabilities. The Borrower will not at any
time permit the aggregate amount of all Off-Balance Sheet Liabilities (excluding
the existing Off-Balance Sheet Liabilities listed on Schedule 6.15) of the
Borrower and its Subsidiaries to exceed $150,000,000.
35
ARTICLE VII.
DEFAULTS
The occurrence of any one or more of the following events shall
constitute a Default:
7.1 Any representation or warranty made or deemed made by or on
behalf of the Borrower or any of its Subsidiaries to the Lenders or the Agent
under or in connection with this Agreement, any Loan, or any certificate or
information delivered in connection with this Agreement or any other Loan
Document shall be materially false on the date as of which made.
7.2 Nonpayment of principal of any Loan when due, nonpayment of
any Reimbursement Obligation within one Business Day after the same becomes due,
or nonpayment of interest upon any Loan or of any commitment fee, utilization
fee, Letter of Credit Fee or other obligations under any of the Loan Documents
within five Business Days after the same becomes due.
7.3 The breach by the Borrower of any of the terms or provisions
of Section 6.2, 6.3, 6.10, 6.11, 6.12, 6.13 or 6.14.
7.4 The breach by the Borrower (other than a breach which
constitutes a Default under another Section of this Article VII) of any of the
terms or provisions of this Agreement which is not remedied within 30 days after
written notice from the Agent or any Lender.
7.5 Failure of the Borrower and/or any of its Significant
Subsidiaries to pay when due any Indebtedness aggregating in excess of
$30,000,000 ("Material Indebtedness"); or the default by the Borrower and/or any
of its Significant Subsidiaries in the performance of any term, provision or
condition contained in any agreement under which any such Material Indebtedness
was created or is governed, or any other event shall occur or condition exist,
the effect of which default or event is to cause, or to permit the holder or
holders of such Material Indebtedness to cause, such Indebtedness to become due
prior to its stated maturity; or any Material Indebtedness of the Borrower
and/or any of its Significant Subsidiaries shall be declared to be due and
payable or required to be prepaid or repurchased (other than by a regularly
scheduled payment) prior to the stated maturity thereof; or the Borrower or any
of its Significant Subsidiaries shall not pay, or admit in writing its inability
to pay, its debts generally as they become due.
7.6 The Borrower or any of its Significant Subsidiaries shall (i)
have an order for relief entered with respect to it under the Federal bankruptcy
laws as now or hereafter in effect, (ii) make an assignment for the benefit of
creditors, (iii) apply for, seek, consent to, or acquiesce in, the appointment
of a receiver, custodian, trustee, examiner, liquidator or similar official for
it or any Substantial Portion of its Property, (iv) institute any proceeding
seeking an order for relief under the Federal bankruptcy laws as now or
hereafter in effect or seeking to adjudicate it a bankrupt or insolvent, or
seeking dissolution, winding up, liquidation, reorganization, arrangement,
adjustment or composition of it or its debts under any law relating to
bankruptcy, insolvency or reorganization or relief of debtors or fail to file an
answer or other pleading denying the material allegations of any such proceeding
filed against it, or (v) take any corporate
36
or partnership action to authorize or effect any of the foregoing actions set
forth in this Section 7.6.
7.7 Without the application, approval or consent of the Borrower
or any of its Significant Subsidiaries, a receiver, trustee, examiner,
liquidator or similar official shall be appointed for the Borrower or any of its
Significant Subsidiaries or any Substantial Portion of its Property, or a
proceeding described in Section 7.6(iv) shall be instituted against the Borrower
or any of its Significant Subsidiaries and such appointment continues
undischarged or such proceeding continues undismissed or unstayed for a period
of 60 consecutive days.
7.8 Any court, government or governmental agency shall condemn,
seize or otherwise appropriate, or take custody or control of, all or any
portion of the Property of the Borrower and its Subsidiaries which, when taken
together with all other Property of the Borrower and its Subsidiaries so
condemned, seized, appropriated, or taken custody or control of, during the
twelve-month period ending with the month in which any such action occurs,
constitutes a Substantial Portion.
7.9 The Borrower or any of its Significant Subsidiaries shall fail
within 30 days to pay, bond or otherwise discharge one or more (i) judgments or
orders for the payment of money in excess of $30,000,000 (or the equivalent
thereof in currencies other than U.S. Dollars) in the aggregate, or (ii)
nonmonetary judgments or orders which, individually or in the aggregate, could
reasonably be expected to have a Material Adverse Effect, which judgment(s), in
any such case, is/are not stayed on appeal or otherwise being appropriately
contested in good faith.
7.10 Any Plan shall have been terminated as a result of which the
Borrower or any other member of the Controlled Group has incurred an unfunded
liability in excess of $50,000,000; or a trustee shall have been appointed by an
appropriate United States District Court to administer any Plan, or PBGC shall
have instituted proceedings to terminate any Plan or to appoint a trustee to
administer any Plan, and in either case such action could reasonably be expected
to result in liability to the Borrower in excess of $50,000,000; or withdrawal
liability in excess of $50,000,000 shall have been asserted against the Borrower
or any other member of the Controlled Group by a Multiemployer Plan; or the
Borrower or any other member of the Controlled Group shall have incurred any
joint and several liability to PBGC, the Internal Revenue Service or the
Department of Labor, or the Borrower shall have incurred any other liability to
PBGC, the Internal Revenue Service or the Department of Labor, in excess of
$50,000,000 with respect to any Plan; or any Reportable Event that the Required
Lenders may determine in good faith could reasonably be expected to constitute
grounds for the termination of any Plan by PBGC, for the appointment by the
appropriate United States District Court of a trustee to administer any Plan or
for the imposition of withdrawal liability with respect to a Multiemployer Plan,
and which, in any such case, could reasonably be expected to result in liability
to the Borrower or any other member of the Controlled Group in excess of
$50,000,000 shall have occurred and be continuing 30 days after written notice
to such effect shall have been given to the Borrower by the Lenders.
7.11 The Borrower or any of its Significant Subsidiaries shall (i)
be the subject of any proceeding or investigation pertaining to the release by
the Borrower, any of its Significant Subsidiaries or any other Person of any
toxic or hazardous waste or substance into the
37
environment, or (ii) violate any Environmental Law, which, in the case of an
event described in clause (i) or clause (ii), could reasonably be expected to
have a Material Adverse Effect.
7.12 The representations and warranties set forth in Section 5.14
("Plan Assets; Prohibited Transactions") shall at any time not be true and
correct.
7.13 Xcel Energy Inc. or any successor thereto shall cease to own,
free and clear of all Liens or other encumbrances, 100% of the outstanding
shares of voting stock of the Borrower on a fully diluted basis.
ARTICLE VIII.
ACCELERATION, WAIVERS, AMENDMENTS AND REMEDIES
8.1 Acceleration; Letter of Credit Collection Account.
(i) If any Default described in Section 7.6 or 7.7 occurs with
respect to the Borrower, the obligations of the Lenders to make Loans
hereunder and the obligation and power of the Issuer to issue Letters
of Credit shall automatically terminate and the Obligations shall
immediately become due and payable without any election or action on
the part of the Agent, any Lender or the Issuer and the Borrower will
be and become thereby unconditionally obligated, without any further
notice, act or demand, to pay to the Agent an amount in immediately
available funds, which funds shall be held in the Letter of Credit
Collateral Account, equal to the excess of (x) the amount of LC
Obligations at such time over (y) the amount on deposit in the Letter
of Credit Collateral Account at such time which is free and clear of
all rights and claims of third parties and has not been applied against
the Obligations (such difference, the "Collateral Shortfall Amount").
If any other Default occurs and is continuing, the Required Lenders (or
the Agent with the consent of the Required Lenders) may (a) terminate
or suspend the obligations of the Lenders to make Loans hereunder and
the obligation and power of the Issuer to issue Letters of Credit, or
declare the Obligations to be due and payable, or both, whereupon the
Obligations shall become immediately due and payable, without
presentment, demand, protest or notice of any kind, all of which the
Borrower hereby expressly waives, and/or (b) upon notice to the
Borrower and in addition to the continuing right to demand payment of
all amounts payable under this Agreement, make demand on the Borrower
to pay, and the Borrower will, forthwith upon such demand and without
any further notice or act, pay to the Agent in immediately available
funds the Collateral Shortfall Amount, which funds shall be deposited
in the Letter of Credit Collateral Account.
(ii) If at any time while any Default exists, the Agent
determines that the Collateral Shortfall Amount at such time is greater
than zero, the Agent may make demand on the Borrower to pay, and the
Borrower will, forthwith upon such demand and without any further
notice or act, pay to the Agent in immediately available funds the
Collateral Shortfall Amount, which funds shall be deposited in the
Letter of Credit Collateral Account.
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(iii) The Agent may at any time or from time to time, after
funds are deposited in the Letter of Credit Collateral Account, apply
such funds to the payment of the Obligations and any other amounts as
shall from time to time have become due and payable by the Borrower to
the Lenders or the Issuer under the Loan Documents.
(iv) At any time while any Default is continuing, neither the
Borrower nor any Person claiming on behalf of or through the Borrower
shall have any right to withdraw any of the funds held in the Letter of
Credit Collateral Account. If the Borrower has deposited funds as
collateral in the Letter of Credit Collateral Account by virtue of the
occurrence of a Default and following such deposit such Default ceases
to exist and no other Default is continuing, then the Agent shall
return to the Borrower any funds then held in the Letter of Credit
Collateral Account; provided that the foregoing shall not limit the
Borrower's obligation to maintain collateral in the Letter of Credit
Collateral Account pursuant to Section 2.20(xi)(ii) on and after the
fifth Business Day preceding the Facility Termination Date, whether or
not a Default is continuing. After all of the Obligations have been
indefeasibly paid in full and the Aggregate Commitment has been
terminated, any funds remaining in the Letter of Credit Collateral
Account shall be returned by the Agent to the Borrower or paid to
whomever may be legally entitled thereto at such time.
If, within 30 days after acceleration of the maturity of the
Obligations or termination of the obligations of the Lenders to make Loans
hereunder as a result of any Default (other than any Default as described in
Section 7.6 or 7.7 with respect to the Borrower) and before any judgment or
decree for the payment of the Obligations due shall have been obtained or
entered, the Required Lenders (in their sole discretion) shall so direct, the
Agent shall, by notice to the Borrower, rescind and annul such acceleration
and/or termination.
8.2 Amendments. Subject to the provisions of this Article VIII,
the Required Lenders (or the Agent with the consent in writing of the Required
Lenders) and the Borrower may enter into agreements supplemental hereto for the
purpose of adding or modifying any provisions to the Loan Documents or changing
in any manner the rights of the Lenders or the Borrower hereunder or waiving any
Default hereunder; provided, however, that no such supplemental agreement shall,
without the consent of all of the Lenders:
(i) Extend the final maturity of any Loan or the Final Maturity
Date, or extend the expiry date of any Letter of Credit to a
date which is one year after the Facility Termination Date,
forgive all or any portion of the principal amount thereof, or
reduce the rate or extend the time of payment of interest or
fees thereon (except as provided in Section 2.11) or any
Reimbursement Obligation related thereto.
(ii) Reduce the percentage specified in the definition of Required
Lenders.
(iii) Extend the Facility Termination Date, or reduce the amount or
extend the payment date for, the mandatory payments required
under Section 2.2, increase the amount of the Aggregate
Commitment or of the Commitment of any Lender hereunder, or
permit the Borrower to assign its rights under this Agreement.
(iv) Amend this Section 8.2.
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No amendment of any provision of this Agreement relating to the Agent shall be
effective without the written consent of the Agent, and no amendment of any
provision to this Agreement relating to the Issuer shall be effective without
the written consent of the Issuer. The Agent may waive payment of the fee
required under Section 12.3.2 without obtaining the consent of any other party
to this Agreement.
8.3 Preservation of Rights. No delay or omission of the Lenders,
the Issuer or the Agent to exercise any right under the Loan Documents shall
impair such right or be construed to be a waiver of any Default or an
acquiescence therein, and the making of a Credit Extension notwithstanding the
existence of a Default or the inability of the Borrower to satisfy the
conditions precedent to such Credit Extension shall not constitute any waiver or
acquiescence. Any single or partial exercise of any such right shall not
preclude other or further exercise thereof or the exercise of any other right,
and no waiver, amendment or other variation of the terms, conditions or
provisions of the Loan Documents whatsoever shall be valid unless in writing
signed by the Lenders required pursuant to Section 8.2, and then only to the
extent in such writing specifically set forth. All remedies contained in the
Loan Documents or by law afforded shall be cumulative and all shall be available
to the Agent, the Lenders and the Issuer until the Obligations have been paid in
full.
ARTICLE IX.
GENERAL PROVISIONS
9.1 Survival of Representations. All representations and
warranties of the Borrower contained in this Agreement shall survive the making
of the Credit Extensions herein contemplated.
9.2 Governmental Regulation. Anything contained in this Agreement
to the contrary notwithstanding, no Issuer or Lender shall be obligated to
extend credit to the Borrower in violation of any limitation or prohibition
provided by any applicable statute or regulation.
9.3 Headings. Section headings in the Loan Documents are for
convenience of reference only, and shall not govern the interpretation of any of
the provisions of the Loan Documents.
9.4 Entire Agreement. The Loan Documents embody the entire
agreement and understanding among the Borrower, the Agent, the Lenders and the
Issuer and supersede all prior agreements and understandings among the Borrower,
the Agent, the Lenders and the Issuer relating to the subject matter thereof
other than the fee letter described in Section 10.13.
9.5 Several Obligations; Benefits of this Agreement. The
respective obligations of the Lenders hereunder are several and not joint and no
Lender shall be the partner or agent of any other (except to the extent to which
the Agent is authorized to act as such). The failure of any Lender to perform
any of its obligations hereunder shall not relieve any other Lender from any of
its obligations hereunder. This Agreement shall not be construed so as to confer
any right or benefit upon any Person other than the parties to this Agreement
and their respective successors and assigns, provided that the parties hereto
expressly agree that the Arrangers shall enjoy the
40
benefits of the provisions of Sections 9.6, 9.10 and 10.11 to the extent
specifically set forth therein and shall have the right to enforce such
provisions on its own behalf and in its own name to the same extent as if it
were a party to this Agreement.
9.6 Expenses; Indemnification.
(i) The Borrower shall reimburse the Agent and the Arrangers
for all reasonable costs, internal charges and out-of-pocket expenses
(including reasonable attorneys' fees and reasonable time charges of
attorneys for the Agent, which attorneys may be employees of the Agent)
paid or incurred by the Agent or the Arrangers in connection with the
preparation, negotiation, execution, delivery, syndication, review,
amendment, modification, and administration of the Loan Documents. The
Borrower also agrees to reimburse the Agent, the Arrangers, the Lenders
and the Issuer for all reasonable costs, internal charges and
out-of-pocket expenses (including reasonable attorneys' fees and
reasonable time charges of attorneys for the Agent, the Arrangers, the
Lenders and the Issuer, which attorneys may be employees of the Agent,
the Arrangers, the Lenders or the Issuer) paid or incurred by the
Agent, the Arrangers, any Lender or the Issuer in connection with the
collection and enforcement of the Loan Documents.
(ii) The Borrower hereby further agrees to indemnify the
Agent, the Arrangers, each Lender, the Issuer, their respective
affiliates, and each of their directors, officers and employees against
all losses, claims, damages, penalties, judgments, liabilities and
reasonable expenses (including, without limitation, all reasonable
expenses of litigation or preparation therefor whether or not the
Agent, the Arrangers, any Lender, the Issuer or any affiliate is a
party thereto) which any of them may pay or incur arising out of or
relating to this Agreement, the other Loan Documents, the transactions
contemplated hereby or the direct or indirect application or proposed
application of the proceeds of any Credit Extension hereunder except to
the extent that they are determined in a final non-appealable judgment
by a court of competent jurisdiction to have resulted from the gross
negligence or willful misconduct of the party seeking indemnification.
The obligations of the Borrower under this Section 9.6 shall survive
the termination of this Agreement.
9.7 Numbers of Documents. All statements, notices, closing
documents, and requests hereunder shall be furnished to the Agent with
sufficient counterparts so that the Agent may furnish one to each of the
Lenders.
9.8 Accounting. Except as provided to the contrary herein, all
accounting terms used herein shall be interpreted and all accounting
determinations hereunder shall be made in accordance with GAAP; provided that in
the event of any Accounting Practices Change, then the Borrower's compliance
with the covenant set forth in Section 6.12 shall be determined on the basis of
generally accepted accounting principles in effect immediately before giving
effect to the Accounting Practices Change, until such covenant is amended in a
manner satisfactory to the Borrower and the Required Lenders. The Borrower shall
notify the Agent of any Accounting Practices Change promptly upon becoming aware
of the same.
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9.9 Severability of Provisions. Any provision in any Loan Document
that is held to be inoperative, unenforceable, or invalid in any jurisdiction
shall, as to that jurisdiction, be inoperative, unenforceable, or invalid
without affecting the remaining provisions in that jurisdiction or the
operation, enforceability, or validity of that provision in any other
jurisdiction, and to this end the provisions of all Loan Documents are declared
to be severable.
9.10 Nonliability of Lenders. The relationship between the Borrower
on the one hand and the Lenders, the Issuer and the Agent on the other hand
shall be solely that of borrower and lender. Neither the Agent, any Arranger,
any Lender nor the Issuer shall have any fiduciary responsibilities to the
Borrower. Neither the Agent, any Arranger, any Lender nor the Issuer undertakes
any responsibility to the Borrower to review or inform the Borrower of any
matter in connection with any phase of the Borrower's business or operations.
The Borrower agrees that neither the Agent, any Arranger, any Lender nor the
Issuer shall have liability to the Borrower (whether sounding in tort, contract
or otherwise) for losses suffered by the Borrower in connection with, arising
out of, or in any way related to, the transactions contemplated and the
relationship established by the Loan Documents, or any act, omission or event
occurring in connection therewith, unless it is determined in a final
non-appealable judgment by a court of competent jurisdiction that such losses
resulted from the gross negligence or willful misconduct of the party from which
recovery is sought. Neither the Agent, any Arranger, any Lender nor the Issuer
shall have any liability with respect to, and the Borrower hereby waives,
releases and agrees not to sue for, any special, indirect or consequential
damages suffered by the Borrower in connection with, arising out of, or in any
way related to the Loan Documents or the transactions contemplated thereby.
9.11 Limited Disclosure.
(a) The Agent and the Lenders shall keep confidential (and cause their
respective officers, directors, employees, agents and representatives to keep
confidential) all information, materials and documents furnished by the Borrower
and its Subsidiaries to the Agent or the Lenders (the "Disclosed Information").
Notwithstanding the foregoing, the Agent and each Lender may disclose Disclosed
Information (i) to the Agent or any other Lender; (ii) to any Affiliate of any
Lender in connection with the transactions contemplated hereby, provided that
such Affiliate has been informed of the confidential nature of such information;
(iii) to legal counsel, accountants and other professional advisors to the Agent
or such Lender; (iv) to any regulatory body having jurisdiction over any Lender
or the Agent; (v) to the extent required by applicable laws and regulations or
by any subpoena or similar legal process, or requested by any governmental
agency or authority; (vi) to the extent such Disclosed Information (A) becomes
publicly available other than as a result of a breach of this Agreement, (B)
becomes available to the Agent or such Lender on a non-confidential basis from a
source other than the Borrower or a Subsidiary, or (C) was available to the
Agent or such Lender on a non-confidential basis prior to its disclosure to the
Agent or such Lender by the Borrower or a Subsidiary; (vii) to the extent the
Borrower or such Subsidiary shall have consented to such disclosure in writing;
(viii) to the extent reasonably deemed necessary by the Agent or any Lender in
the enforcement of the remedies of the Agent and the Lenders provided under the
Loan Documents; or (ix) in connection with any potential assignment or
participation in the interest granted hereunder, provided that any such
potential assignee or participant shall have executed a confidentiality
42
agreement imposing on such potential assignee or participant substantially the
same obligations as are imposed on the Agent and the Lenders under this Section
9.11(a).
(b) The provisions of this Section 9.11 supersede any confidentiality
obligations of any Lender or the Agent relating to the Commitments or under any
agreement between the Borrower and any such party relating thereto. The parties
hereto agree that any such confidentiality obligations of any Lender or the
Agent shall be deemed void ab initio to the extent the same relate to the
Commitments.
9.12 Nonreliance. Each Lender hereby represents that it is not
relying on or looking to any margin stock (as defined in Regulation U of the
Board of Governors of the Federal Reserve System) for the repayment of the
Credit Extensions provided for herein.
9.13 Disclosure. Each Lender and the Issuer hereby (i) acknowledge
and agree that Bank One and/or its Affiliates from time to time may hold
investments in, make other loans to or have other relationships with the
Borrower and its Affiliates, and (ii) waive any liability of Bank One or such
Affiliate of Bank One to such Lender, respectively, arising out of or resulting
from such investments, loans or relationships other than liabilities arising out
of the gross negligence or willful misconduct of Bank One or its Affiliates.
ARTICLE X.
THE AGENT
10.1 Appointment; Nature of Relationship. Bank One is hereby
appointed by each of the Lenders as its contractual representative (herein
referred to as the "Agent") hereunder and under each other Loan Document, and
each of the Lenders irrevocably authorizes the Agent to act as the contractual
representative of such Lender with the rights and duties expressly set forth
herein and in the other Loan Documents. The Agent agrees to act as such
contractual representative upon the express conditions contained in this Article
X. Notwithstanding the use of the defined term "Agent," it is expressly
understood and agreed that the Agent shall not have any fiduciary
responsibilities to any Lender by reason of this Agreement or any other Loan
Document and that the Agent is merely acting as the contractual representative
of the Lenders with only those duties as are expressly set forth in this
Agreement and the other Loan Documents. In its capacity as the Lenders'
contractual representative, the Agent (i) does not hereby assume any fiduciary
duties to any of the Lenders, (ii) is a "representative" of the Lenders within
the meaning of Section 9-105 of the Uniform Commercial Code and (iii) is acting
as an independent contractor, the rights and duties of which are limited to
those expressly set forth in this Agreement and the other Loan Documents. Each
of the Lenders hereby agrees to assert no claim against the Agent on any agency
theory or any other theory of liability for breach of fiduciary duty, all of
which claims each Lender hereby waives.
10.2 Powers. The Agent shall have and may exercise such powers
under the Loan Documents as are specifically delegated to the Agent by the terms
of each thereof, together with such powers as are reasonably incidental thereto.
The Agent shall have no implied duties to the Lenders, or any obligation to the
Lenders to take any action thereunder except any action specifically provided by
the Loan Documents to be taken by the Agent.
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10.3 General Immunity. Neither the Agent nor any of its directors,
officers, agents or employees shall be liable to the Borrower or any Lender for
any action taken or omitted to be taken by it or them hereunder or under any
other Loan Document or in connection herewith or therewith except to the extent
such action or inaction is determined in a final non-appealable judgment by a
court of competent jurisdiction to have arisen from the gross negligence or
willful misconduct of such Person.
10.4 No Responsibility for Loans, Recitals, etc. Neither the Agent
nor any of its directors, officers, agents or employees shall be responsible for
or have any duty to ascertain, inquire into, or verify (a) any statement,
warranty or representation made in connection with any Loan Document or any
borrowing hereunder; (b) the performance or observance of any of the covenants
or agreements of any obligor under any Loan Document, including, without
limitation, any agreement by an obligor to furnish information directly to each
Lender; (c) the satisfaction of any condition specified in Article IV, except
receipt of items required to be delivered solely to the Agent; (d) the existence
or possible existence of any Default or Unmatured Default; (e) the validity,
enforceability, effectiveness, sufficiency or genuineness of any Loan Document
or any other instrument or writing furnished in connection therewith, or (f) the
financial condition of the Borrower or of any of the Borrower's Subsidiaries.
The Agent shall have no duty to disclose to the Lenders information that is not
required to be furnished by the Borrower to the Agent at such time, but is
voluntarily furnished by the Borrower to the Agent (either in its capacity as
Agent or in its individual capacity).
10.5 Action on Instructions of Lenders. The Agent shall in all
cases be fully protected in acting, or in refraining from acting, hereunder and
under any other Loan Document in accordance with written instructions signed by
the Required Lenders (or, when expressly required hereunder, all of the
Lenders), and such instructions and any action taken or failure to act pursuant
thereto shall be binding on all of the Lenders. The Lenders hereby acknowledge
that the Agent shall be under no duty to take any discretionary action permitted
to be taken by it pursuant to the provisions of this Agreement or any other Loan
Document unless it shall be requested in writing to do so by the Required
Lenders. The Agent shall be fully justified in failing or refusing to take any
action hereunder and under any other Loan Document unless it shall first be
indemnified to its satisfaction by the Lenders pro rata against any and all
liability, cost and expense that it may incur by reason of taking or continuing
to take any such action.
10.6 Employment of Agents and Counsel. The Agent may execute any of
its duties as Agent hereunder and under any other Loan Document by or through
employees, agents, and attorneys-in-fact and shall not be answerable to the
Lenders, except as to money or securities received by it or its authorized
agents, for the default or misconduct of any such agents or attorneys-in-fact
selected by it with reasonable care. The Agent shall be entitled to advice of
counsel concerning the contractual arrangement between the Agent and the Lenders
and all matters pertaining to the Agent's duties hereunder and under any other
Loan Document.
10.7 Reliance on Documents; Counsel. The Agent shall be entitled to
rely upon any Note, notice, consent, certificate, affidavit, letter, telegram,
statement, paper or document believed by it to be genuine and correct and to
have been signed or sent by the proper person or persons, and, in respect to
legal matters, upon the opinion of counsel selected by the Agent, which counsel
may be employees of the Agent.
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10.8 Agent's Reimbursement and Indemnification. The Lenders agree
to reimburse and indemnify the Agent ratably in proportion to their respective
Commitments (or, if the Commitments have been terminated, in proportion to their
Commitments immediately prior to such termination) (i) for any amounts not
reimbursed by the Borrower for which the Agent is entitled to reimbursement by
the Borrower under the Loan Documents, (ii) for any other expenses incurred by
the Agent on behalf of the Lenders, in connection with the preparation,
execution, delivery, administration and enforcement of the Loan Documents
(including, without limitation, for any expenses incurred by the Agent in
connection with any dispute between the Agent and any Lender or between two or
more of the Lenders) and (iii) for any liabilities, obligations, losses,
damages, penalties, actions, judgments, suits, costs, expenses or disbursements
of any kind and nature whatsoever which may be imposed on, incurred by or
asserted against the Agent in any way relating to or arising out of the Loan
Documents or any other document delivered in connection therewith or the
transactions contemplated thereby (including, without limitation, for any such
amounts incurred by or asserted against the Agent in connection with any dispute
between the Agent and any Lender or between two or more of the Lenders), or the
enforcement of any of the terms of the Loan Documents or of any such other
documents, provided that (i) no Lender shall be liable for any of the foregoing
to the extent any of the foregoing is found in a final non-appealable judgment
by a court of competent jurisdiction to have resulted from the gross negligence
or willful misconduct of the Agent and (ii) any indemnification required
pursuant to Section 3.5(vii) shall, notwithstanding the provisions of this
Section 10.8, be paid by the relevant Lender in accordance with the provisions
thereof. The obligations of the Lenders under this Section 10.8 shall survive
payment of the Obligations and termination of this Agreement.
10.9 Notice of Default. The Agent shall not be deemed to have
knowledge or notice of the occurrence of any Default or Unmatured Default
hereunder unless the Agent has received written notice from a Lender or the
Borrower referring to this Agreement describing such Default or Unmatured
Default and stating that such notice is a "notice of default". In the event that
the Agent receives such a notice, the Agent shall give prompt notice thereof to
the Lenders.
10.10 Rights as a Lender. In the event the Agent is a Lender, the
Agent shall have the same rights and powers hereunder and under any other Loan
Document with respect to its Commitment and its Loans as any Lender and may
exercise the same as though it were not the Agent, and the term "Lender" or
"Lenders" shall, at any time when the Agent is a Lender, unless the context
otherwise indicates, include the Agent in its individual capacity. The Agent and
its Affiliates may accept deposits from, lend money to, and generally engage in
any kind of trust, debt, equity or other transaction, in addition to those
contemplated by this Agreement or any other Loan Document, with the Borrower or
any of its Subsidiaries in which the Borrower or such Subsidiary is not
restricted hereby from engaging with any other Person. The Agent, in its
individual capacity, is not obligated to remain a Lender.
10.11 Lender Credit Decision. Each Lender acknowledges that it has,
independently and without reliance upon the Agent, any Arranger or any other
Lender and based on the financial statements prepared by the Borrower and such
other documents and information as it has deemed appropriate, made its own
credit analysis and decision to enter into this Agreement and the other Loan
Documents. Each Lender also acknowledges that it will, independently and without
reliance upon the Agent, any Arranger or any other Lender and based on such
documents
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and information as it shall deem appropriate at the time, continue to make its
own credit decisions in taking or not taking action under this Agreement and the
other Loan Documents.
10.12 Successor Agent. The Agent may resign at any time by giving
written notice thereof to the Lenders and the Borrower, such resignation to be
effective upon the appointment of a successor Agent or, if no successor Agent
has been appointed, forty-five days after the retiring Agent gives notice of its
intention to resign. The Agent may be removed at any time with or without cause
by written notice received by the Agent from the Required Lenders, such removal
to be effective on the date specified by the Required Lenders; provided that the
Agent may not be removed unless the Agent (in its individual capacity) and any
affiliate thereof acting as Issuer is relieved of all of its duties as Issuer
pursuant to documentation reasonably satisfactory to such Person on or prior to
the date of such removal. Upon any such resignation or removal, the Required
Lenders shall have the right to appoint, on behalf of the Borrower and the
Lenders, a successor Agent. If no successor Agent shall have been so appointed
by the Required Lenders within thirty days after the resigning Agent's giving
notice of its intention to resign, then the resigning Agent may appoint, on
behalf of the Borrower and the Lenders, a successor Agent. Notwithstanding the
previous sentence, the Agent may at any time without the consent of any Lender
and with the consent of the Borrower, not to be unreasonably withheld or
delayed, appoint any of its Affiliates which is a commercial bank as a successor
Agent hereunder. If the Agent has resigned or been removed and no successor
Agent has been appointed, the Lenders may perform all the duties of the Agent
hereunder and the Borrower shall make all payments in respect of the Obligations
to the applicable Lender and for all other purposes shall deal directly with the
Lenders. No successor Agent shall be deemed to be appointed hereunder until such
successor Agent has accepted the appointment. Any such successor Agent shall be
a commercial bank having capital and retained earnings of at least $100,000,000.
Upon the acceptance of any appointment as Agent hereunder by a successor Agent,
such successor Agent shall thereupon succeed to and become vested with all the
rights, powers, privileges and duties of the resigning or removed Agent. Upon
the effectiveness of the resignation or removal of the Agent, the resigning or
removed Agent shall be discharged from its duties and obligations hereunder and
under the Loan Documents. After the effectiveness of the resignation or removal
of an Agent, the provisions of this Article X shall continue in effect for the
benefit of such Agent in respect of any actions taken or omitted to be taken by
it while it was acting as the Agent hereunder and under the other Loan
Documents. In the event that there is a successor to the Agent by merger, or the
Agent assigns its duties and obligations to an Affiliate pursuant to this
Section 10.12, then the term "Prime Rate" as used in this Agreement shall mean
the prime rate, base rate or other analogous rate of the new Agent.
10.13 Agent's Fee. The Borrower agrees to pay to the Agent, for its
own account, the fees agreed to by the Borrower and the Agent pursuant to that
certain letter agreement dated January 16, 2004, or as otherwise agreed from
time to time.
10.14 Delegation to Affiliates. The Borrower and the Lenders agree
that the Agent may delegate any of its duties under this Agreement to any of its
Affiliates. Any such Affiliate (and such Affiliate's directors, officers, agents
and employees) which performs duties in connection with this Agreement shall be
entitled to the same benefits of the indemnification, waiver and other
protective provisions to which the Agent is entitled under Articles IX and X.
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10.15 Syndication Agent, Documentation Agents. No Lender identified
on the cover page, the signature pages or otherwise in this Agreement, or in any
document related hereto, as being the "Syndication Agent" or a "Co-Documentation
Agent" shall have any right, power, obligation, liability, responsibility or
duty under this Agreement in such capacity other than those applicable to all
Lenders. Each Lender acknowledges that it has not relied, and will not rely, on
the Syndication Agent or the Co-Documentation Agents in deciding to enter into
this Agreement or in taking or refraining from taking any action hereunder or
pursuant hereto.
ARTICLE XI.
SETOFF; RATABLE PAYMENTS
11.1 Setoff. In addition to, and without limitation of, any rights
of the Lenders under applicable law, if the Borrower becomes insolvent, however
evidenced, or any Default occurs, any and all deposits (including all account
balances, whether provisional or final and whether or not collected or
available) and any other Indebtedness at any time held or owing by any Lender or
any Affiliate of any Lender to or for the credit or account of the Borrower may
be offset and applied toward the payment of the Obligations owing to such
Lender, whether or not the Obligations, or any part thereof, shall then be due.
11.2 Ratable Payments. If any Lender, whether by setoff or
otherwise, has payment made to it upon its Outstanding Credit Exposure (other
than payments received pursuant to Section 3.1, 3.2, 3.4 or 3.5 and payments
made to the Issuer in respect of Reimbursement Obligations so long as the
Lenders have not funded their participations therein) in a greater proportion
than that received by any other Lender, such Lender agrees, promptly upon
demand, to purchase a portion of the Aggregate Outstanding Credit Exposure held
by the other Lenders so that after such purchase each Lender will hold its
ratable proportion of the Aggregate Outstanding Credit Exposure. If any Lender,
whether in connection with setoff or amounts which might be subject to setoff or
otherwise, receives collateral or other protection for its Obligations or such
amounts which may be subject to setoff, such Lender agrees, promptly upon
demand, to take such action necessary such that all Lenders share in the
benefits of such collateral ratably in proportion to their Aggregate Outstanding
Credit Exposure. In case any such payment is disturbed by legal process, or
otherwise, appropriate further adjustments shall be made.
ARTICLE XII.
BENEFIT OF AGREEMENT; ASSIGNMENTS; PARTICIPATIONS
12.1 Successors and Assigns. The terms and provisions of the Loan
Documents shall be binding upon and inure to the benefit of the Borrower and the
Lenders and their respective successors and assigns, except that (i) the
Borrower shall not have the right to assign its rights or obligations under the
Loan Documents and (ii) any assignment by any Lender must be made in compliance
with Section 12.3. The parties to this Agreement acknowledge that clause (ii) of
this Section 12.1 relates only to absolute assignments and does not prohibit
assignments creating security interests by any Lender of all or any portion of
its rights under this Agreement and any Note to a Federal Reserve Bank; provided
that no such pledge or assignment creating a security
47
interest shall release the transferor Lender from its obligations hereunder
unless and until the parties thereto have complied with the provisions of
Section 12.3. The Agent may treat the Person which made any Loan or which holds
any Note as the owner thereof for all purposes hereof unless and until such
Person complies with Section 12.3; provided that the Agent may in its discretion
(but shall not be required to) follow instructions from the Person which made
any Loan or which holds any Note to direct payments relating to such Loan or
Note to another Person and such payments shall be deemed for all purposes of
this Agreement to be payment to such Person. Any assignee of the rights to any
Loan or any Note agrees by acceptance of such assignment to be bound by all the
terms and provisions of the Loan Documents. Any request, authority or consent of
any Person, who at the time of making such request or giving such authority or
consent is the owner of the rights to any Loan (whether or not a Note has been
issued in evidence thereof), shall be conclusive and binding on any subsequent
holder or assignee of the rights to such Loan.
12.2 Participations.
12.2.1 Permitted Participants; Effect. Any Lender may, in the
ordinary course of its business and in accordance with applicable law, at any
time sell to one or more banks or other entities ("Participants") participating
interests in any Outstanding Credit Exposure owing to such Lender, any Note held
by such Lender, any Commitment of such Lender or any other interest of such
Lender under the Loan Documents. In the event of any such sale by a Lender of
participating interests to a Participant, such Lender's obligations under the
Loan Documents shall remain unchanged, such Lender shall remain solely
responsible to the other parties hereto for the performance of such obligations,
such Lender shall remain the owner of its Outstanding Credit Exposure and the
holder of any Note issued to it in evidence thereof for all purposes under the
Loan Documents, all amounts payable by the Borrower under this Agreement shall
be determined as if such Lender had not sold such participating interests, and
the Borrower and the Agent shall continue to deal solely and directly with such
Lender in connection with such Lender's rights and obligations under the Loan
Documents.
12.2.2 Voting Rights. Each Lender shall retain the sole right to
approve, without the consent of any Participant, any amendment, modification or
waiver of any provision of the Loan Documents other than any amendment,
modification or waiver with respect to any Credit Extension or Commitment in
which such Participant has an interest which forgives principal, interest, fees
or Reimbursement Obligations or reduces the interest rate or fees payable with
respect to any such Credit Extension or Commitment (other than pursuant to
Section 2.11), extends the Facility Termination Date or the Final Maturity Date,
or postpones any date fixed for any regularly scheduled payment of principal of,
or interest or fees on, any such Credit Extension or Commitment.
12.2.3 Benefit of Setoff. The Borrower agrees that each Participant
shall be deemed to have the right of setoff provided in Section 11.1 in respect
of its participating interest in amounts owing under the Loan Documents to the
same extent as if the amount of its participating interest were owing directly
to it as a Lender under the Loan Documents, provided that each Lender shall
retain the right of setoff provided in Section 11.1 with respect to the amount
of participating interests sold to each Participant. The Lenders agree to share
with each Participant, and each Participant, by exercising the right of setoff
provided in Section 11.1, agrees to share with each
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Lender, any amount received pursuant to the exercise of its right of setoff,
such amounts to be shared in accordance with Section 11.2 as if each Participant
were a Lender.
12.3 Assignments.
12.3.1 Permitted Assignments. Any Lender may, in the ordinary course
of its business and in accordance with applicable law, at any time assign to one
or more banks or other entities ("Purchasers") all or any part of its rights and
obligations under the Loan Documents. Such assignment shall be substantially in
the form of Exhibit C or in such other form as may be agreed to by the parties
thereto. The consent of the Borrower and the Agent shall be required prior to an
assignment becoming effective with respect to a Purchaser which is not a Lender
or an Affiliate thereof; provided that if a Default has occurred and is
continuing, the consent of the Borrower shall not be required. Such consent
shall not be unreasonably withheld or delayed. Each such assignment with respect
to a Purchaser which is not a Lender or an Affiliate thereof shall (unless each
of the Borrower and the Agent otherwise consents) be in an amount not less than
the lesser of (i) $10,000,000 or (ii) the remaining amount of the assigning
Lender's Commitment (calculated as at the date of such assignment) or
outstanding Loans (if the applicable Commitment has been terminated).
12.3.2 Effect; Effective Date. Upon (i) delivery to the Agent of an
assignment, together with any consents required by Section 12.3.1, and (ii)
payment of a $3,500 fee to the Agent for processing such assignment (unless such
fee is waived by the Agent), such assignment shall become effective on the
effective date specified in such assignment. The assignment shall contain a
representation and warranty by the Purchaser to the effect that none of the
funds, monies, assets or other consideration used to make the purchase and
assumption of the Commitment and Outstanding Credit Exposure under the
applicable assignment agreement constitutes "plan assets" as defined under ERISA
and that the rights, benefits and interests of the Purchaser in and under the
Loan Documents will not be "plan assets" under ERISA. On and after the effective
date of such assignment, such Purchaser shall for all purposes be a Lender party
to this Agreement and any other Loan Document executed by or on behalf of the
Lenders and shall have all the rights and obligations of a Lender under the Loan
Documents, to the same extent as if it were an original party hereto, and no
further consent or action by the Borrower, the Lenders or the Agent shall be
required to release the transferor Lender with respect to the percentage of the
Aggregate Commitment and the Aggregate Outstanding Credit Exposure assigned to
such Purchaser. Upon the consummation of any assignment to a Purchaser pursuant
to this Section 12.3.2, the transferor Lender, the Agent and the Borrower shall,
if the transferor Lender or the Purchaser desires that its Loans be evidenced by
Notes, make appropriate arrangements so that new Notes or, as appropriate,
replacement Notes are issued to such transferor Lender and new Notes or, as
appropriate, replacement Notes, are issued to such Purchaser, in each case in
principal amounts reflecting their respective Commitments, as adjusted pursuant
to such assignment.
12.4 Dissemination of Information. The Borrower authorizes each
Lender to disclose to any Participant or Purchaser or any other Person acquiring
an interest in the Loan Documents by operation of law (each a "Transferee") and
any prospective Transferee any and all information in such Lender's possession
concerning the creditworthiness of the Borrower and its
49
Subsidiaries; provided that each Transferee and prospective Transferee agrees to
be bound by Section 9.11 of this Agreement.
12.5 Tax Treatment. If any interest in any Loan Document is
transferred to any Transferee which is organized under the laws of any
jurisdiction other than the United States or any State thereof, the transferor
Lender shall cause such Transferee, concurrently with the effectiveness of such
transfer, to comply with the provisions of Section 3.5(iv).
ARTICLE XIII.
NOTICES
13.1 Notices. Except as otherwise permitted by Section 2.14 with
respect to borrowing notices, all notices, requests and other communications to
any party hereunder shall be in writing (including electronic transmission,
facsimile transmission or similar writing) and shall be given to such party: (x)
in the case of the Borrower or the Agent, at its address or facsimile number set
forth on Schedule 13.1 hereto, (y) in the case of any Lender, at its address or
facsimile number set forth on Schedule 13.1 hereto or (z) in the case of any
party, at such other address or facsimile number as such party may hereafter
specify for the purpose by notice to the Agent and the Borrower in accordance
with the provisions of this Section 13.1. Each such notice, request or other
communication shall be effective (i) if given by facsimile transmission, when
transmitted to the facsimile number specified in this Section and confirmation
of receipt is received, or (ii) if given by any other means, when delivered (or,
in the case of electronic transmission, received) at the address specified in
this Section; provided that notices to the Agent under Article II shall not be
effective until received.
13.2 Change of Address. The Borrower, the Agent and any Lender may
each change the address for service of notice upon it by a notice in writing to
the other parties hereto.
ARTICLE XIV.
COUNTERPARTS
This Agreement may be executed in any number of counterparts, all of
which taken together shall constitute one agreement, and any of the parties
hereto may execute this Agreement by signing any such counterpart. This
Agreement shall be effective when it has been executed by the Borrower, the
Agent and the Lenders and each party has notified the Agent by facsimile
transmission or telephone that it has taken such action.
ARTICLE XV.
CHOICE OF LAW; CONSENT TO JURISDICTION;
WAIVER OF JURY TRIAL; MAXIMUM INTEREST RATE
15.1 CHOICE OF LAW. THE LOAN DOCUMENTS (OTHER THAN THOSE CONTAINING
A CONTRARY EXPRESS CHOICE OF LAW PROVISION) SHALL BE CONSTRUED IN ACCORDANCE
WITH THE INTERNAL LAWS (INCLUDING, WITHOUT LIMITATION, 735 ILCS SECTION 105/5-1
ET SEQ, BUT OTHERWISE
50
WITHOUT REGARD TO THE CONFLICT OF LAWS PROVISIONS) OF THE STATE OF ILLINOIS, BUT
GIVING EFFECT TO FEDERAL LAWS APPLICABLE TO NATIONAL BANKS.
15.2 CONSENT TO JURISDICTION. EACH OF THE BORROWER, THE AGENT, THE
ISSUER AND THE LENDERS HEREBY IRREVOCABLY SUBMITS TO THE NON-EXCLUSIVE
JURISDICTION OF ANY UNITED STATES FEDERAL OR ILLINOIS STATE COURT SITTING IN
CHICAGO, ILLINOIS IN ANY ACTION OR PROCEEDING ARISING OUT OF OR RELATING TO ANY
LOAN DOCUMENTS AND EACH OF THE BORROWER, THE AGENT, THE ISSUER AND THE LENDERS
HEREBY IRREVOCABLY AGREES THAT ALL CLAIMS IN RESPECT OF SUCH ACTION OR
PROCEEDING MAY BE HEARD AND DETERMINED IN ANY SUCH COURT AND IRREVOCABLY WAIVES
ANY OBJECTION IT MAY NOW OR HEREAFTER HAVE AS TO THE VENUE OF ANY SUCH SUIT,
ACTION OR PROCEEDING BROUGHT IN SUCH A COURT OR THAT SUCH COURT IS AN
INCONVENIENT FORUM. NOTHING HEREIN SHALL LIMIT THE RIGHT OF THE AGENT, ANY
LENDER OR THE ISSUER TO BRING PROCEEDINGS AGAINST THE BORROWER IN THE COURTS OF
ANY OTHER JURISDICTION. ANY JUDICIAL PROCEEDING BY THE BORROWER AGAINST THE
AGENT OR ANY LENDER OR ANY AFFILIATE OF THE AGENT OR ANY LENDER INVOLVING,
DIRECTLY OR INDIRECTLY, ANY MATTER IN ANY WAY ARISING OUT OF, RELATED TO, OR
CONNECTED WITH ANY LOAN DOCUMENT SHALL BE BROUGHT ONLY IN A COURT IN CHICAGO,
ILLINOIS.
15.3 WAIVER OF JURY TRIAL. THE BORROWER, THE AGENT, THE ISSUER AND
EACH LENDER HEREBY WAIVE TRIAL BY JURY IN ANY JUDICIAL PROCEEDING INVOLVING,
DIRECTLY OR INDIRECTLY, ANY MATTER (WHETHER SOUNDING IN TORT, CONTRACT OR
OTHERWISE) IN ANY WAY ARISING OUT OF, RELATED TO, OR CONNECTED WITH ANY LOAN
DOCUMENT OR THE RELATIONSHIP ESTABLISHED THEREUNDER.
15.4 Maximum Interest Rate. No provision of the Loan Documents
shall require the payment or permit the collection of interest in excess of the
maximum permitted by applicable law ("Maximum Rate"). If any interest in excess
of the Maximum Rate is provided for or shall be adjudicated to be provided for
in the Notes or otherwise in connection with this Agreement, the provisions of
this Section 15.4 shall govern and prevail and neither the Borrower nor the
sureties, guarantors, successors or assigns of the Borrower shall be obligated
to pay the excess amount of the interest or any other excess sum paid for the
use, forbearance, or detention of sums loaned. In the event the Agent or any
Lender ever receives, collects or applies as interest any amount in excess of
the Maximum Rate, the amount by which such amount exceeds the Maximum Rate shall
be applied as a payment and reduction of the principal of indebtedness evidenced
by the Loans, and, if the principal amount of the Loans has been paid in full,
any remaining excess shall forthwith be paid to the Borrower.
[SIGNATURES FOLLOW]
51
IN WITNESS WHEREOF, the Borrower, the Lenders and the Agent have
executed this Agreement as of the date first above written.
SOUTHWESTERN PUBLIC SERVICE COMPANY
By: /s/ Richard C. Kelly
---------------------------------
Name: Richard C. Kelly
Title: Vice President
By: /s/ George E. Tyson II
---------------------------------
Name: George E. Tyson II
Title: Assistant Treasurer
Credit Agreement
BANK ONE, NA, individually and as Agent
By: /s/ Jane Bek Keil
------------------------------------
Name: Jane Bek Keil
Title: Director
Credit Agreement
WELLS FARGO BANK, N.A., as Syndication
Agent and as a Lender
By: /s/ Scott D. Bjelde
--------------------------------------
Name: Scott D. Bjelde
Title: Vice President & Senior Banker
By: /s/ Jennifer D. Barrett
--------------------------------------
Name: Jennifer D. Barrett
Title: Vice President & Loan Team Manager
Credit Agreement
HARRIS NESBITT FINANCING, INC., as a
Lender
By: /s/ James B. Whitmore
------------------------------------
Name: James B. Whitmore
Title: Managing Director
BANK OF MONTREAL (D/B/A HARRIS
NESBITT), as Co-Documentation Agent
By: /s/ James B. Whitmore
------------------------------------
Name: James B. Whitmore
Title: Managing Director
Credit Agreement
THE BANK OF NEW YORK, as Co-
Documentation Agent and as a Lender
By: /s/ Cynthia D. Howells
------------------------------------
Name: Cynthia D. Howells
Title: Vice President
Credit Agreement
THE BANK OF TOKYO-MITSUBISHI, LTD.
By: /s/ John M. Mearns
------------------------------------
Name: John M. Mearns
Title: VP & Manager
Credit Agreement
KEYBANK NATIONAL ASSOCIATION
By: /s/ Keven D. Smith
------------------------------------
Name: Keven D. Smith
Title: Vice President
Credit Agreement
UBS LOAN FINANCE LLC
By: /s/ Wilfred V. Saint
------------------------------------
Name: Wilfred V. Saint
Title: Associate Director
Banking Products
Services, US
By: /s/ Juan Zuniga
------------------------------------
Name: Juan Zuniga
Title: Associate Director
Banking Products
Services, US
Credit Agreement
AMARILLO NATIONAL BANK
By: /s/ Craig L. Sanders
------------------------------------
Name: Craig L. Sanders
Title: Executive Vice President
Credit Agreement
SCHEDULE I
PRICING SCHEDULE
LEVEL
APPLICABLE LEVEL I LEVEL II LEVEL III LEVEL IV LEVEL V VI
MARGIN STATUS STATUS STATUS STATUS STATUS STATUS
------ ------ ------ ------ ------ ------ ------
Eurodollar Rate 0.625% 0.750% 0.875% 1.125% 1.250% 2.000%
LEVEL
LEVEL I LEVEL II LEVEL III LEVEL IV LEVEL V VI
FEES STATUS STATUS STATUS STATUS STATUS STATUS
---- ------ ------ ------ ------ ------ ------
Commitment Fee
Rate 0.085% 0.10% 0.1250% 0.15% 0.20% 0.30%
Letter of Credit
Fee Rate 0.625% 0.750% 0.875% 1.125% 1.250% 2.000%
Utilization Fee
Rate 0.125% 0.125% 0.125% 0.125% 0.25% 0.25%
For the purposes of this Schedule, the following terms have the
following meanings, subject to the final paragraph of this Schedule:
"Level I Status" exists at any date if, on such date, the Borrower's
Moody's Rating is A2 or better or the Borrower's S&P Rating is A or better.
"Level II Status" exists at any date if, on such date, (i) the Borrower
has not qualified for Level I Status and (ii) the Borrower's Moody's Rating is
A3 or better or the Borrower's S&P Rating is A- or better.
"Level III Status" exists at any date if, on such date, (i) the
Borrower has not qualified for Level I Status or Level II Status; and (ii) the
Borrower's Moody's Rating is Baa1 or better or the Borrower's S&P Rating is BBB+
or better.
"Level IV Status" exists at any date if, on such date, (i) the Borrower
has not qualified for Level I Status, Level II Status or Level III Status; and
(ii) the Borrower's Moody's Rating is Baa2 or better and the Borrower's S&P
Rating is BBB or better.
"Level V Status" exists at any date if, on such date, (i) the Borrower
has not qualified for Level I Status, Level II Status, Level III Status or Level
IV Status; and (ii) the Borrower's Moody's Rating is Baa3 or better or the
Borrower's S&P Rating is BBB- or better.
"Level VI Status" exists at any date if, on such date, the Borrower has
not qualified for Level I Status, Level II Status, Level III Status, Level IV
Status or Level V Status.
Schedule I-1
"Moody's Rating" means, at any time, the rating issued by Moody's and
then in effect with respect to the Borrower's senior unsecured long-term debt
securities without third-party credit enhancement.
"S&P Rating" means, at any time, the rating issued by S&P and then in
effect with respect to the Borrower's senior unsecured long-term debt securities
without third-party credit enhancement.
"Status" means Level I Status, Level II Status, Level III Status, Level
IV Status, Level V Status or Level VI Status.
The Applicable Margin, the Commitment Fee Rate, the Utilization Fee
Rate and the Letter of Credit Fee Rate shall be determined in accordance with
the foregoing table based on the Borrower's Status as determined from its
then-current Moody's and S&P Ratings. The credit rating in effect on any date
for the purposes of this Schedule is that in effect at the close of business on
such date. If at any time the Borrower has no Moody's Rating or no S&P Rating,
Level VI Status shall exist.
If the Borrower is split-rated and the ratings differential is one
level, the higher rating will apply. If the Borrower is split-rated and the
ratings differential is two levels or more, the intermediate rating at the
midpoint will apply. If there is no midpoint, the higher of the two intermediate
ratings will apply.
Schedule I-2
SCHEDULE II
COMMITMENT SCHEDULE
Allocation
----------
Bank One, NA $ 18,750,000
Wells Fargo Bank, N.A. 18,750,000
Harris Nesbitt Financing, Inc. 18,500,000
The Bank of New York 18,500,000
The Bank of Tokyo-Mitsubishi, Ltd. 13,500,000
KeyBank National Association 13,500,000
UBS Loan Finance LLC 13,500,000
Amarillo National Bank 10,000,000
============
TOTAL $125,000,000
Schedule II-1
SCHEDULE 5.7
LITIGATION; CONTINGENT LIABILITIES
On July 24, 1995, Lamb County Electric Cooperative, Inc. ("LCEC")
petitioned the Public Utility Commission of Texas ("PUCT") for a cease and
desist order against the Borrower. LCEC alleged that the Borrower had been
unlawfully providing service to oil field customers and their facilities in
LCEC's singly certificated area. A trial on the merits was held in October 2002,
and on May 23, 2003, the PUCT issued an order denying LCEC's petition for cease
and desist order against the Borrower. The basis of the decision was the
determination that the Borrower was granted a certificate of convenience and
necessity in 1976 to serve the disputed customers. LCEC has filed an appeal of
the decision with the District Court in Travis County, Texas. The appeal is
expected to include a substantial evidence review of the record evidence
introduced at the PUCT proceeding. The Texas Attorney General has responded to
the appeal on behalf of the PUCT and the Borrower, Texaco Exploration and
Production Inc. and Apache Corporation have intervened in the proceeding in
support of the PUCT's decision. A hearing on the appeal is scheduled for April
9, 2004.
On October 18, 1996, LCEC filed a suit for damages against the Borrower
in the District Court in Lamb County, Texas, based the same facts as alleged in
its petition for a cease and desist order at the PUCT. This suit has been
dormant since it was filed, awaiting a final determination at the PUCT of the
legality of the Borrower providing electric service to the disputed customers.
The PUCT order of May 23, 2003 found that the Borrower was legally serving the
disputed customers thus collaterally determining the issue of liability contrary
to LCEC's position in the suit. An adverse ruling on the appeal of the May 23,
2003 PUCT order could reverse the PUCT's determination that the Borrower's
service to the disputed customers was legal. A decision adverse to the Borrower
in this case could be material.
Schedule
5.7-1
SCHEDULE 5.15
ENVIRONMENTAL MATTERS
None
Schedule
5.15-1
SCHEDULE 6.13
EXISTING LIENS
1. Liens in connection with the $25,000,000 aggregate principal
amount of Red River Authority of Texas Adjustable Rate Tender Securities
(Pollution Control Revenue Refunding Bonds, Southwestern Public Service Company
Project), Series 1996
2. Liens in connection with the $57,300,000 aggregate principal
amount of Potter County Development Corporation Pollution Control Revenue
Refunding Bonds (Southwestern Public Service Company Project), Series 1996
3. Liens in connection with the $44,500,000 aggregate principal
amount of Red River Authority of Texas Adjustable Rate Tender Securities
(Pollution Control Revenue Refunding Bonds, Southwestern Public Service Company
Project), Series 1991
4. Liens in connection with financing in the amount of
$17,700,000 relating to construction of electric bulk power transmission system,
including approximately 284 miles of transmission lines and rights under related
construction contracts, transmission agreement and power sales agreement
Schedule
6.13-1
SCHEDULE 6.15
OFF BALANCE SHEET LIABILITIES
Existing Synthetic Lease with an unamortized balance of $12,903,657 as
of December 31, 2003.
Schedule
6.15-1
SCHEDULE 13.1
NOTICES
- --------------------------------------------------------------------------------
SOUTHWESTERN PUBLIC SERVICE COMPANY BANK ONE, NA
800 Nicollet Mall, Suite 2900 1 Bank One Plaza; IL1-0367
Minneapolis, MN 55402 Chicago, Illinois 60670
Attention: Mary Schell Attention: Jane Bek Keil
Telephone: (612) 215-5362 Telephone: (312) 325-3026
Fax: (612) 215-5370 Fax: (312) 325-3020
- --------------------------------------------------------------------------------
WELLS FARGO, N.A. HARRIS NESBITT FINANCING, INC.
6th & Marquette Avenue 700 Louisiana Street; Suite 4400
Minneapolis, MN 55479 Houston, TX 77002
MAC N9305-031 Attention: Cahal Carmody
Attention: Scott Bjelde Telephone: (713) 546-9750
Telephone: (612) 667-6126
- --------------------------------------------------------------------------------
THE BANK OF NEW YORK THE BANK OF TOKYO MITSUBISHI, LTD.
1 Wall Street, 19th Floor 2001 Ross Avenue, LB 118
New York, NY 10286 Dallas, TX 75201
Attention: Cynthia Howells Attention: John M. Mearns
Telephone: (212) 635-7889 Telephone: (214) 954-1200 ext 104
Fax: (212) 635-7923
- --------------------------------------------------------------------------------
UBS LOAN FINANCE LLC KEYBANK NATIONAL ASSOCIATION
677 Washington Boulevard 601 108th Avenue Northeast
Stamford CT 06901 Bellevue, WA 98009-9027
Attention: Marie Haddad Attention: Keven Smith
Telephone: (213) 719-5609 Telephone: (425) 709-4579
- --------------------------------------------------------------------------------
AMARILLO NATIONAL BANK
401 South Taylor Street
Amarillo, TX 79105
Attention: Craig Sanders
Telephone: (806) 378-8244
Fax: (806) 345-1663
- --------------------------------------------------------------------------------
Schedule
13.1-1
EXHIBIT A-1
FORM OF NEW MEXICO OPINION
February 17, 2004
To: The Agent and the Lenders who are parties to the
Credit Agreement described below.
Re: Southwestern Public Service Company
Ladies and Gentlemen:
We have acted as counsel for Southwestern Public Service Company (the
"Borrower") and have represented the Borrower in connection with its execution
and delivery of a Credit Agreement dated as of February 17, 2004 (the
"Agreement"), among the Borrower, the Lenders named therein, Bank One, NA, as
Agent, Wells Fargo Bank, N.A., as Syndication Agent, Bank of Montreal (d/b/a
Harris Nesbitt) and The Bank of New York, as Co-Documentation Agents and Bank
One Capital Markets, Inc. and Wells Fargo Bank, N.A., as Co-Lead Arrangers and
Book Runners, providing for Credit Extensions in an aggregate principal amount
not exceeding $125,000,000 at any one time outstanding. All capitalized terms
used in this opinion and not otherwise defined herein shall have the meanings
attributed to them in the Agreement.
We are not general counsel to the Borrower, and our representation
consists of advising the Borrower on corporate matters as to which we have been
specifically consulted. In connection with this opinion, we have examined the
originals or photocopies of the Agreement, the Notes executed and to be executed
by the Borrower, and such corporate records, agreements and instruments of the
Borrower, certificates of public officials and of officers of the Borrower, such
other documents and records, and such matters of law, as we have deemed
necessary or appropriate for purposes of the opinions rendered below. In such
examination, we have assumed the genuineness of all signatures (other than those
of the Borrower), the authenticity of all documents submitted to us as copies
and the authenticity of the originals of such latter documents. In addition,
where relevant facts were not independently established, we have relied as to
matters of fact (but not conclusions of law) upon the aforesaid agreements,
corporate records, instruments, documents and certificates, discussions with
officers and representatives of the Borrower, the representations and warranties
of the Borrower contained in the Agreement and the certificates of officers of
the Borrower being delivered to you in connection with the Agreement. In
rendering this opinion, we have also assumed that the Agreement has been duly
authorized, executed and delivered by, and is the legal, valid and binding
agreement of, and is enforceable against, the Lenders.
Based on the foregoing examination, and subject to the limitations and
qualifications set forth in this letter, we are of the opinion that:
Exhibit A-1-
1
1. The Borrower is a corporation, duly and properly incorporated,
validly existing, and in good standing under the laws of New Mexico and has all
requisite authority to conduct its business in each jurisdiction in which
qualification is required, except where the failure to so qualify would not have
a Material Adverse Effect.
2. The execution and delivery by the Borrower of the Loan
Documents and the performance by the Borrower of its obligations thereunder have
been duly authorized by proper corporate proceedings on the part of the Borrower
and will not:
(a) require any consent of the Borrower's shareholders;
(b) violate (i) any law, rule, regulation, order, writ,
judgment, injunction, decree or award binding on the Borrower or (ii)
the Borrower's restated articles of incorporation, or bylaws, or (iii)
the provisions of any indenture, instrument or agreement to which the
Borrower is a party or is subject, or by which it, or its Property, is
bound, or conflict with or constitute a default thereunder; or
(c) result in, or require, the creation or imposition of
any Lien in, of, or on the Property of the Borrower pursuant to the
terms of any indenture, instrument or agreement binding upon the
Borrower.
3. The Loan Documents have been duly executed and delivered by
the Borrower.
4. Except as set forth in the Borrower's Annual Report on Form
10-K for the fiscal year ended December 31, 2002, the Borrower's Quarterly
reports on Form 10-Q for the quarters ended March 31, 2003, June 30, 2003, and
September 30, 2003, and in Schedule 5.7 to the Agreement, there is no
litigation, arbitration, governmental investigation, proceeding or inquiry
pending or, to the best of our knowledge after due inquiry, threatened against
the Borrower which, if adversely determined, could reasonably be expected to
have a Material Adverse Effect.
5. No order, consent, adjudication, approval, license,
authorization, or validation of, or filing, recording or registration with, or
exemption by, or other action in respect of any governmental or public body or
authority, or any subdivision thereof which has not been obtained by the
Borrower is required to be obtained by the Borrower in connection with the
execution and delivery of the Loan Documents, the borrowings under the
Agreement, the payment and performance by the Borrower of the Obligations, or
the legality, validity, binding effect or enforceability of any of the Loan
Documents.
This opinion is subject to and qualified in all respects by the
following:
1. This opinion is limited to federal law and the laws of New
Mexico as in effect on the date hereof, and we disclaim any responsibility to
inform you of any changes after the date hereof. We express no opinion as to (a)
any matter that may be governed by the laws of any other jurisdiction; (b) state
and federal securities, tax, and ERISA laws, rules, and regulations; or
Exhibit A-1-
2
(c) potential liability imposed by any of the foregoing laws with respect to the
transactions contemplated by the Agreement.
2. We express no opinion not expressly stated herein, and no
further or other opinion shall be implied.
This opinion is being delivered solely in connection with the closing
under the Agreement that is being consummated on the date hereof. The opinions
expressed herein are based upon the laws mentioned above in effect on the date
hereof, and we assume no obligation to revise or supplement this letter to take
into account any event, action, interpretation, change of circumstance, change
of law or other matters coming to our attention after the date hereof.
This opinion may be relied upon by the Agent, the Lenders, and their
participants, assignees and other transferees.
Very truly yours,
Exhibit A-1-
3
EXHIBIT A-2
FORM OF ILLINOIS OPINION
February 17, 2004
The Persons identified
on Schedule I hereto
Ladies and Gentlemen:
We have acted as special Illinois counsel for Southwestern Public
Service Company, a New Mexico corporation (the "Borrower"), in connection with
the Credit Agreement dated as of February 17, 2004 (the "Credit Agreement") by
and between the Borrower, Bank One, N.A., as Administrative Agent (in such
capacity, the "Agent") and the financial institutions party thereto (the
"Banks"). This opinion is delivered to you pursuant to Section 4.1(vi) of the
Credit Agreement. Capitalized terms used herein and not otherwise defined herein
have the meanings assigned to such terms in the Credit Agreement. With your
permission, all assumptions and statements of reliance herein have been made
without any independent investigation or verification on our part except to the
extent, if any, otherwise expressly stated, and we express no opinion with
respect to the subject matter or accuracy of the assumptions or items upon which
we have relied.
In connection with the opinions expressed herein, we have examined such
documents, records and matters of law as we have deemed necessary for the
purposes of this opinion. We have examined, among other documents, (i) a copy of
the Credit Agreement and (ii) the form of Note attached as Exhibit B to the
Credit Agreement (the "Note"). The Credit Agreement and the Notes issued
thereunder are referred to herein collectively as the "Documents". In all such
examinations, we have assumed the legal capacity of all natural persons
executing documents, the genuineness of all signatures, the authenticity of
original and certified documents and the conformity to original or certified
copies of all copies submitted to us as conformed or reproduction copies. As to
various questions of fact relevant to the opinions expressed herein, we have
relied upon, and assume the accuracy of, representations and warranties
contained in the Documents and certificates and oral or written statements and
other information of or from representatives of the Borrower and others and
assume compliance on the part of the Borrower and each other party to the
Documents with their covenants and agreements contained therein. With respect to
the opinion expressed in paragraphs (a) and (b) below, our opinions are limited
(x) to our actual knowledge of the specially regulated business activities and
properties of the Borrower, based upon review of the Annual Report on Form 10-K
for the fiscal year ended December 31, 2002 and the Quarterly Reports on Form
10-Q for the quarters ended March 31, 2003, June 30, 2003 and September 30,
2003, as filed by the Borrower with the Securities and Exchange Commission, but
without any additional investigation or verification on our part, and
Exhibit A-2-
1
(y) to our review of only those laws and regulations that, in our experience,
are normally applicable to transactions of the type contemplated by the
Documents.
Based upon the foregoing, and subject to the limitations,
qualifications and assumptions set forth herein, we are of the opinion that:
(a) The Credit Agreement constitutes a valid and binding
obligation of the Borrower, enforceable against the Borrower in accordance with
its terms. Upon execution and delivery of the Notes by the Borrower, each such
Note will constitute a valid and binding obligation of the Borrower, enforceable
against the Borrower in accordance with its terms.
(b) Based upon the assumptions set forth in paragraph (c) below,
the execution and delivery of the Documents by the Borrower and the performance
by the Borrower of its obligations thereunder do not violate any present law, or
present regulation of any governmental agency or authority, of the United States
of America applicable to the Borrower or its property.
(c) Assuming that the execution and delivery of, and performance
of its obligations under, the Credit Agreement and the Notes have been duly
authorized and approved by an order of the New Mexico Public Regulation
Commission and such order is in full force and effect on the date hereof, no
approval, authorization, consent or order of any public board or body under the
laws of the United States of America is legally required in connection with the
execution, delivery and performance by the Borrower of the Documents.
(d) The Borrower is not an "investment company" or a company
"controlled" by an "investment company" as such terms are defined in the
Investment Company Act of 1940, as amended.
(e) The Borrower (i) is a "public utility" and a "subsidiary
company" of a "holding company", as such terms are defined in the Public Utility
Holding Company Act of 1935, as amended (the "Holding Company Act").
The opinions set forth above are subject to the following
qualifications:
1. Our opinions in paragraph (a) above are subject to (i)
applicable bankruptcy, insolvency, reorganization, fraudulent transfer and
conveyance, moratorium, receivership, conservatorship, arrangement or similar
laws, and related regulations and judicial doctrines, from time to time in
effect affecting creditors' rights and remedies generally, and (ii) general
principles of equity (including, without limitation, standards of materiality,
good faith, fair dealing and reasonableness, equitable defenses, the exercise of
judicial discretion and limits on the availability of equitable remedies),
whether such principles are considered in a proceeding at law or in equity.
2. We express no opinion as to the enforceability of any
provision in the Credit Agreement or the Notes:
Exhibit A-2-
2
(i) relating to indemnification, contribution or
exculpation in connection with violations of any securities laws or
statutory duties or public policy, or in connection with willful,
reckless or unlawful acts or gross negligence of the indemnified or
exculpated party or the party receiving contribution;
(ii) providing that any person or entity may exercise
set-off rights other than in accordance with and pursuant to applicable
law;
(iii) relating to choice of governing law to the extent
that the enforceability of any such provision is to be determined by
any court other than a court of the State of Illinois;
(iv) waiving any rights to trial by jury;
(v) purporting to confer, or constituting an agreement
with respect to, subject matter jurisdiction of United States Federal
courts to adjudicate any matter;
(vi) purporting to create a trust or other fiduciary
relationship;
(vii) specifying that provisions thereof may be waived only
in writing, to the extent that an oral agreement or an implied
agreement by trade practice or course of conduct has been created that
modifies any provision of the Documents; or
(viii) giving any person or entity the power to accelerate
obligations without any notice to the Borrower.
3. Our opinions as to enforceability are subject to the effect of
generally applicable rules of law that:
(i) provide that forum selection clauses in contracts are
not necessarily binding on the court(s) in the forum selected; and
(ii) may, where less than all of a contract may be
unenforceable, limit the enforceability of the balance of the contract to
circumstances in which the unenforceable portion is not an essential part of the
agreed exchange, or that permit a court to reserve to itself a decision as to
whether any provision of any agreement is severable.
4. We express no opinion as to the creation, validity,
enforceability, perfection or priority of any pledge, security interest,
assignment for security, lien or other encumbrance, as the case may be, that may
be created or purported to be created under the Documents.
5. We express no opinion as to the enforceability of any
purported waiver, release, variation, disclaimer, consent or other agreement to
similar effect (all of the foregoing, collectively, a "Waiver") by the Borrower
under the Documents to the extent limited by provisions of applicable law
(including judicial decisions), or to the extent that such a Waiver applies to a
right, claim, duty or defense or a ground for, or a circumstance that would
operate as,
Exhibit A-2-
3
a discharge or release otherwise existing or occurring as a matter of law
(including judicial decisions).
6. To the extent it may be relevant to the opinions expressed
herein, we have assumed that the parties to the Documents (other than the
Borrower) have the power to enter into and perform such documents and to
consummate the transactions contemplated thereby and that such documents have
been duly authorized, executed and delivered by, and constitute legal, valid and
binding obligations of, such parties.
7. For purposes of our opinions above, we have assumed that (i)
the Borrower is a corporation validly existing and in good standing in its
jurisdiction of organization, (ii) the Borrower has all requisite power and
authority, and has obtained all requisite corporate, shareholder, board, and
third party authorizations, consents and approvals, (iii) except to the extent
of our opinion in paragraph (c) above, the Borrower has obtained all requisite
governmental authorizations, consents and approvals, and made all requisite
filings and registrations, necessary to execute, deliver and perform the
Documents, (iv) except to the extent of our opinion in paragraph (b) above, the
execution, delivery and performance of the Documents by the Borrower will not
violate or conflict with any law, rule, regulation, order, decree, judgment,
instrument or agreement binding upon or applicable to the Borrower or its
properties, and (v) the Documents to which the Borrower is a party have been
duly executed and delivered by it.
8. We express no opinion herein with respect to any law, rule or
regulation as to tax or securities matters or as to any matters relating to
ERISA.
The opinions expressed herein are limited to the federal laws of the
United States and the laws of the State of Illinois.
We express no opinion as to the compliance or noncompliance, or the
effect of the compliance or noncompliance, of each of the addressees or any
other person or entity with any state or federal laws or regulations applicable
to each of them by reason of their status as or affiliation with a federally
insured depository institution. Our opinions are limited to those expressly set
forth herein, and we express no opinions by implication.
The opinions expressed herein are solely for the benefit of the
addressees hereof in connection with the transaction referred to herein and may
not be relied on by such addressees for any other purpose or in any manner or
for any purpose by any other person or entity; provided, however, that this
opinion may be relied upon by any Purchaser which becomes a "Lender" under the
Credit Agreement pursuant to the provisions of Section 12.3 of the Credit
Agreement to the extent that the addressees hereto may rely on it. This opinion
speaks only as of the date hereof and to its addressees and we have no
responsibility or obligation to update this opinion, to consider its
applicability or correctness to other than its addressees, or to take into
account changes in law, facts or any other development of which we may later
become aware.
Very truly yours,
Exhibit A-2-
4
SCHEDULE I
Bank One, NA
Wells Fargo Bank, National Association
Harris Nesbitt Financing, Inc.
The Bank of New York
The Bank of Tokyo-Mitsubishi, Ltd.
KeyBank National Association
UBS Loan Finance LLC
Amarillo National Bank
Exhibit A-2-
5
EXHIBIT B
FORM OF ASSIGNMENT AGREEMENT
This Assignment Agreement (this "Assignment Agreement") between
_______________________________ (the "Assignor") and _________________________
(the "Assignee") is dated as of ___________________, 20___. The parties hereto
agree as follows:
1. PRELIMINARY STATEMENT. The Assignor is a party to a Credit
Agreement (which, as it may be amended, modified, renewed or extended from time
to time is herein called the "Credit Agreement") described in Item 1 of Schedule
1 attached hereto ("Schedule 1"). Capitalized terms used herein and not
otherwise defined herein shall have the meanings attributed to them in the
Credit Agreement.
2. ASSIGNMENT AND ASSUMPTION. The Assignor hereby sells and
assigns to the Assignee, and the Assignee hereby purchases and assumes from the
Assignor, an interest in and to the Assignor's rights and obligations under the
Credit Agreement and the other Loan Documents, such that after giving effect to
such assignment the Assignee shall have purchased pursuant to this Assignment
Agreement the percentage interest specified in Item 3 of Schedule 1 of all
outstanding rights and obligations under the Credit Agreement and the other Loan
Documents relating to the facilities listed in Item 3 of Schedule 1. The
aggregate Commitment (or Loans, if the applicable Commitment has been
terminated) purchased by the Assignee hereunder is set forth in Item 4 of
Schedule 1.
3. EFFECTIVE DATE. The effective date of this Assignment
Agreement (the "Effective Date") shall be the later of the date specified in
Item 5 of Schedule 1 or two Business Days (or such shorter period agreed to by
the Agent) after this Assignment Agreement, together with any consents required
under the Credit Agreement, are delivered to the Agent. In no event will the
Effective Date occur if the Assignor notifies the Agent that payments required
to be made by the Assignee to the Assignor on the Effective Date are not made on
the proposed Effective Date.
4. PAYMENT OBLIGATIONS. In consideration for the sale and
assignment of Loans hereunder, the Assignee shall pay the Assignor, on the
Effective Date, the amount agreed to by the Assignor and the Assignee. On and
after the Effective Date, the Assignee shall be entitled to receive from the
Agent all payments of principal, interest and fees with respect to the interest
assigned hereby. The Assignee will promptly remit to the Assignor any interest
on Loans and fees received from the Agent which relate to the portion of the
Commitment or Loans assigned to the Assignee hereunder for periods prior to the
Effective Date and not previously paid by the Assignee to the Assignor. In the
event that either party hereto receives any payment to which the other party
hereto is entitled under this Assignment Agreement, then the party receiving
such amount shall promptly remit it to the other party hereto.
5. RECORDATION FEE. The Assignor and Assignee each agree to pay
one-half of the recordation fee required to be paid to the Agent in connection
with this Assignment Agreement unless otherwise specified in Item 6 of Schedule
1.
Exhibit B-1
6. REPRESENTATIONS OF THE ASSIGNOR; LIMITATIONS ON THE ASSIGNOR'S
LIABILITY. The Assignor represents and warrants that (i) it is the legal and
beneficial owner of the interest being assigned by it hereunder, (ii) such
interest is free and clear of any adverse claim created by the Assignor and
(iii) the execution and delivery of this Assignment Agreement by the Assignor is
duly authorized. It is understood and agreed that the assignment and assumption
hereunder are made without recourse to the Assignor and that the Assignor makes
no other representation or warranty of any kind to the Assignee. Neither the
Assignor nor any of its officers, directors, employees, agents or attorneys
shall be responsible for (i) the due execution, legality, validity,
enforceability, genuineness, sufficiency or collectability of any Loan Document,
including without limitation, documents granting the Assignor and the other
Lenders a security interest in assets of the Borrower or any guarantor, (ii) any
representation, warranty or statement made in or in connection with any of the
Loan Documents, (iii) the financial condition or creditworthiness of the
Borrower or any guarantor, (iv) the performance of or compliance with any of the
terms or provisions of any of the Loan Documents, (v) inspecting any of the
property, books or records of the Borrower, (vi) the validity, enforceability,
perfection, priority, condition, value or sufficiency of any collateral securing
or purporting to secure the Loans or (vii) any mistake, error of judgment, or
action taken or omitted to be taken in connection with the Loans or the Loan
Documents.
7. REPRESENTATIONS AND UNDERTAKINGS OF THE ASSIGNEE. The Assignee
(i) confirms that it has received a copy of the Credit Agreement, together with
copies of the financial statements requested by the Assignee and such other
documents and information as it has deemed appropriate to make its own credit
analysis and decision to enter into this Assignment Agreement, (ii) agrees that
it will, independently and without reliance upon the Agent, the Assignor or any
other Lender and based on such documents and information as it shall deem
appropriate at the time, continue to make its own credit decisions in taking or
not taking action under the Loan Documents, (iii) appoints and authorizes the
Agent to take such action as agent on its behalf and to exercise such powers
under the Loan Documents as are delegated to the Agent by the terms thereof,
together with such powers as are reasonably incidental thereto, (iv) confirms
that the execution and delivery of this Assignment Agreement by the Assignee is
duly authorized, (v) agrees that it will perform in accordance with their terms
all of the obligations which by the terms of the Loan Documents are required to
be performed by it as a Lender, (vi) agrees that its payment instructions and
notice instructions are as set forth in the attachment to Schedule 1, (vii)
confirms, represents and warrants that none of the funds, monies, assets or
other consideration being used to make the purchase and assumption hereunder are
"plan assets" as defined under ERISA and that its rights, benefits and interests
in and under the Loan Documents will not be "plan assets" under ERISA, (viii)
agrees to indemnify and hold the Assignor harmless against all losses, costs and
expenses (including, without limitation, reasonable attorneys' fees) and
liabilities incurred by the Assignor in connection with or arising in any manner
from the Assignee's nonperformance of the obligations assumed under this
Assignment Agreement, and (ix) if applicable, attaches the forms prescribed by
the Internal Revenue Service of the United States certifying that the Assignee
is entitled to receive payments under the Loan Documents without deduction or
withholding of any United States federal income taxes.
8. GOVERNING LAW. This Assignment Agreement shall be governed by
the internal law, and not the law of conflicts, of the State of Illinois.
Exhibit B-2
9. NOTICES. Notices shall be given under this Assignment
Agreement in the manner set forth in the Credit Agreement. For the purpose
hereof, the addresses of the parties hereto (until notice of a change is
delivered) shall be the address set forth in the attachment to Schedule 1.
10. COUNTERPARTS; DELIVERY BY FACSIMILE. This Assignment Agreement
may be executed in counterparts. Transmission by facsimile of an executed
counterpart of this Assignment Agreement shall be deemed to constitute due and
sufficient delivery of such counterpart and such facsimile shall be deemed to be
an original counterpart of this Assignment Agreement.
IN WITNESS WHEREOF, the duly authorized officers of the parties hereto have
executed this Assignment Agreement by executing Schedule 1 hereto as of the date
first above written.
Exhibit B-3
SCHEDULE 1
to Assignment Agreement
1. Description and Date of Credit Agreement:
Credit Agreement dated as of February 17, 2004 among Southwestern
Public Service Company, the lenders named therein including
the Assignor, Wells Fargo Bank, N.A., individually and as
Syndication Agent, Bank of Montreal (d/b/a Harris Nesbitt) and
The Bank of New York, individually and as Co-Documentation
Agents and Bank One, NA individually and as Agent for such
lenders, as it may be amended from time to time.
2. Date of Assignment Agreement: _________, 20
3. Amounts (As of Date of Item 2 above):
a. Assignee's percentage
of Aggregate Commitment
(Advances) purchased
under the Assignment
Agreement** ____%
b. Amount of
Assignor's Commitment
purchased under the Assignment
Agreement** $____
4. Assignee's Commitment (or Loans
with respect to terminated
Commitments) purchased
hereunder: $__________________
5. Proposed Effective Date: ___________________
6. Non-standard Recordation Fee
Arrangement
N/A***
[Assignor/Assignee
to pay 100% of fee]
[Fee waived by Agent]
Exhibit B-4
Accepted and Agreed:
[NAME OF ASSIGNOR] [NAME OF ASSIGNEE]
By:___________________________ By:_________________________________
Title_________________________ Title:______________________________
Exhibit B-5
ACCEPTED AND CONSENTED TO****BY ACCEPTED AND CONSENTED
TO BY
SOUTHWESTERN PUBLIC BANK ONE, NA, as Agent
SERVICE COMPANY
By:___________________________ By:_________________________________
Title_________________________ Title:______________________________
________________________________________________________________________________
** Percentage taken to 10 decimal places
*** If fee is split 50-50, pick N/A as option
**** Delete if not required by Credit Agreement
Exhibit B-6
Attachment to SCHEDULE 1 to ASSIGNMENT AGREEMENT
ADMINISTRATIVE INFORMATION SHEET
Attach Assignor's Administrative Information
Sheet, which must include notice addresses
for the Assignor and the Assignee
(Sample form shown below)
ASSIGNOR INFORMATION
CONTACT:
Name:____________________________ Telephone No.:_______________________
Fax No.:________________________ Telex No.:___________________________
Answerback:__________________________
PAYMENT INFORMATION:
Name & ABA # of Destination Bank: __________________________________
Account Name & Number for Wire Transfer: __________________________________
__________________________________
Other Instructions:_____________________________________________________________
ADDRESS FOR NOTICES FOR ASSIGNOR:__________________________________
ASSIGNEE INFORMATION
CREDIT CONTACT:
Name:____________________________ Telephone No.:_______________________
Fax No.:________________________ Telex No.:___________________________
Answerback:__________________________
Exhibit B-7
KEY OPERATIONS CONTACTS:
Booking Installation: Booking Installation:
Name: Name:
Telephone No.: Telephone No.:
Fax No.: Fax No.:
Telex No.: Telex No.:
Answerback: Answerback:
PAYMENT INFORMATION:
Name & ABA # of Destination Bank:
Account Name & Number for Wire Transfer:
Other Instructions:
ADDRESS FOR NOTICES FOR ASSIGNEE:
Exhibit B-8
BANK ONE INFORMATION
Assignee will be called promptly upon receipt of the signed agreement.
INITIAL FUNDING CONTACT: SUBSEQUENT OPERATIONS CONTACT:
Name: Name:
Telephone No.: (312) Telephone No.: (312)
Fax No.: (312) Fax No.: (312)
Bank One Telex No.: 190201 (Answerback: FNBC UT)
INITIAL FUNDING STANDARDS:
Libor Fund 2 days after rates are set.
BANK ONE WIRE INSTRUCTIONS: Bank One, NA, ABA # 071000013
LS2 Incoming Account # 481152860000
Ref:________________
ADDRESS FOR NOTICES FOR BANK ONE: 1 Bank One Plaza, Chicago, IL 60670
Attn: Agency Compliance Division, Suite IL1-0353
Fax No. (312) 732-2038 or (312) 732-4339
Exhibit B-9
EXHIBIT C
FORM OF LOAN/CREDIT RELATED MONEY TRANSFER INSTRUCTION
To Bank One, NA,
as Agent (the "Agent") under the Credit Agreement
Described Below.
Re: Credit Agreement, dated as of February 17, 2004 (as the same may be
amended or modified, the "Credit Agreement"), among Southwestern Public Service
Company (the "Borrower"), the Lenders named therein and the Agent. Capitalized
terms used herein and not otherwise defined herein shall have the meanings
assigned thereto in the Credit Agreement.
The Agent is specifically authorized and directed to act upon the
following standing money transfer instructions with respect to the proceeds of
Credit Extensions or other extensions of credit from time to time until receipt
by the Agent of a specific written revocation of such instructions by the
Borrower, provided that the Agent may otherwise transfer funds as hereafter
directed in writing by the Borrower in accordance with Section 13.1 of the
Credit Agreement or based on any telephonic notice made in accordance with
Section 2.14 of the Credit Agreement.
Facility Identification Number(s)______________________________________
Customer/Account Name: Southwestern Public Service Company
Transfer Funds To______________________________________________________
For Account No.________________________________________________________
Reference/Attention To_________________________________________________
Authorized Officer (Customer Representative) Date_______________
_____________________________________ ________________________
(Please Print) Signature
Bank Officer Name Date____________________
_____________________________________ ________________________
(Please Print) Signature
(Deliver Completed Form to Credit Support Staff For Immediate Processing)
Exhibit C-1
EXHIBIT D
FORM OF NOTE
[Date]
Southwestern Public Service Company, a New Mexico corporation
(the "Borrower"), promises to pay to the order of ______________________________
(the "Lender") the aggregate unpaid principal amount of all Loans made by the
Lender to the Borrower pursuant to Article II of the Agreement (as hereinafter
defined), in immediately available funds at the main office of Bank One, NA in
Chicago, Illinois, as Agent, together with interest on the unpaid principal
amount hereof at the rates and on the dates set forth in the Agreement. The
Borrower shall pay the principal of and accrued and unpaid interest on the Loans
in full on the Final Maturity Date.
The Lender shall, and is hereby authorized to, record on the
schedule attached hereto, or to otherwise record in accordance with its usual
practice, the date and amount of each Loan and the date and amount of each
principal payment hereunder.
This Note is one of the Notes issued pursuant to, and is
entitled to the benefits of, the Credit Agreement dated as of February 17, 2004
(which, as it may be amended or modified and in effect from time to time, is
herein called the "Agreement"), among the Borrower, the lenders party thereto,
including the Lender, Wells Fargo Bank, N.A., as Syndication Agent, Bank of
Montreal (d/b/a Harris Nesbitt) and The Bank of New York, as Co-Documentation
Agents and Bank One, NA, as Agent, to which Agreement reference is hereby made
for a statement of the terms and conditions governing this Note, including the
terms and conditions under which this Note may be prepaid or its maturity date
accelerated. Capitalized terms used herein and not otherwise defined herein are
used with the meanings attributed to them in the Agreement.
Notwithstanding anything to the contrary in this Note, no
provision of this Note shall require the payment or permit the collection of
interest in excess of the maximum permitted by applicable law ("Maximum Rate").
If any interest in excess of the Maximum Rate is provided for or shall be
adjudicated to be so provided, in this Note or otherwise in connection with the
loan transaction, the provisions of this paragraph shall govern and prevail, and
neither the Borrower nor the sureties, guarantors, successors or assigns of the
Borrower shall be obligated to pay the excess of the interest or any other
excess sum paid for the use, forbearance, or detention of sums loaned. If for
any reason interest in excess of the Maximum Rate shall be deemed charged,
required or permitted by any court of competent jurisdiction, the excess shall
be applied a payment and reduction of the principal of indebtedness evidenced by
this Note, and, if the principal amount has been paid in full, any remaining
excess shall forthwith be paid to the Borrower.
Exhibit D-1
This Note shall be construed in accordance with the internal
laws (and not the law of conflicts) of the State of Illinois, but giving effect
to Federal laws applicable to national banks.
SOUTHWESTERN PUBLIC SERVICE COMPANY
By:_____________________________________
Print Name:_____________________________
Title:__________________________________
By:_____________________________________
Print Name:_____________________________
Title:__________________________________
Exhibit D-2
SCHEDULE OF LOANS AND PAYMENTS OF PRINCIPAL
TO
NOTE OF SOUTHWESTERN PUBLIC SERVICE COMPANY
DATED _____________,
Principal Maturity Principal
Date Amount of Loan of Interest Period Amount Paid Unpaid Balance
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Exhibit D-3
EXHIBIT E
FORM OF COMPLIANCE CERTIFICATE
_________________________, 20___
Bank One, NA, as Agent under the
Credit Agreement referred to below
Ladies/Gentlemen:
Please refer to the Credit Agreement dated as of February 17, 2004
among Southwestern Public Service Company (the "Borrower"), various financial
institutions, Wells Fargo Bank, N.A., as Syndication Agent, Bank of Montreal
(d/b/a Harris Nesbitt) and The Bank of New York, as Co-Documentation Agents and
Bank One, NA, as Agent (as amended, modified, extended or restated from time to
time, the "Credit Agreement"). Capitalized terms used but not defined herein
have the respective meanings set forth in the Credit Agreement.
The Borrower certifies to you that (a) set forth on the Annex hereto is
a correct calculation of the financial covenant set forth in Section 6.12 of the
Credit Agreement as of _______________; and (b) no Default or Unmatured Default
exists as of the date of this Certificate[, except as specified in reasonable
detail below:]
Very truly yours,
SOUTHWESTERN PUBLIC SERVICE COMPANY
By: __________________________________
Name: ________________________________
Title: _______________________________
Exhibit E-1
ANNEX TO COMPLIANCE CERTIFICATE
Debt to Capitalization Ratio (Section 6.12)
1. Indebtedness
(a) Long-term debt (including current maturities) $_________________
(b) Commercial paper & other short term debt $_________________
(c) Letters of credit $_________________
(d) Net liabilities under swaps, etc. $_________________
(e) Capitalized Lease Obligations $_________________
(f) Off-Balance Sheet Liabilities $_________________
(g) Contingent Obligations $_________________
(h) Total Debt (sum of (a) through (g)) $_________________
2. Capitalization
(a) Total Common Stock $_________________
(b) Total Retained Earnings $_________________
(c) Total Debt (from 1(h) above) $_________________
(d) Capitalization (sum of (a) through (c)) $_________________
3. Debt to Capitalization Ratio (1(h) to 2(d)) _____ to 1.
(not to be greater than 0.60 to 1.0)
Exhibit E-2
TABLE OF CONTENTS
PAGE
ARTICLE I. DEFINITIONS............................................................................... 1
ARTICLE II. THE CREDITS............................................................................... 11
2.1 Commitment.................................................................................... 11
2.2 Required Payments; Maturity................................................................... 11
2.3 Ratable Loans................................................................................. 11
2.4 Types of Advances............................................................................. 12
2.5 Commitment Fee; Utilization Fee; Reduction of Aggregate Commitment; Up-Front Fees............. 12
2.6 Minimum Amount of Each Advance................................................................ 12
2.7 Optional Principal Payments................................................................... 12
2.8 Method of Selecting Types and Interest Periods for New Advances............................... 13
2.9 Conversion and Continuation of Outstanding Advances........................................... 13
2.10 Changes in Interest Rate, etc................................................................. 13
2.11 Rates Applicable After Default................................................................ 14
2.12 Method of Payment............................................................................. 14
2.13 Noteless Agreement; Evidence of Indebtedness.................................................. 14
2.14 Telephonic Notices............................................................................ 15
2.15 Interest Payment Dates; Interest and Fee Basis................................................ 15
2.16 Notification of Advances, Interest Rates, Prepayments and Commitment Reductions............... 16
2.17 Lending Installations......................................................................... 16
2.18 Non-Receipt of Funds by the Agent............................................................. 16
2.19 Replacement of Lender......................................................................... 16
2.20 Letters of Credit............................................................................. 17
ARTICLE III. YIELD PROTECTION; TAXES................................................................... 21
3.1 Yield Protection.............................................................................. 21
3.2 Changes in Capital Adequacy Regulations....................................................... 22
3.3 Availability of Types of Advances............................................................. 23
3.4 Funding Indemnification....................................................................... 23
3.5 Taxes......................................................................................... 23
3.6 Alternate Lending Installation; Lender Statements; Survival of Indemnity...................... 25
-i-
TABLE OF CONTENTS
(continued)
PAGE
3.7 ERISA Representations......................................................................... 25
ARTICLE IV. CONDITIONS PRECEDENT...................................................................... 26
4.1 Initial Credit Extension...................................................................... 26
4.2 Each Credit Extension......................................................................... 27
ARTICLE V. REPRESENTATIONS AND WARRANTIES............................................................ 27
5.1 Existence and Standing........................................................................ 27
5.2 Authorization and Validity.................................................................... 27
5.3 No Conflict; Government Consent............................................................... 27
5.4 Financial Statements.......................................................................... 28
5.5 Material Adverse Change....................................................................... 28
5.6 Taxes......................................................................................... 28
5.7 Litigation and Contingent Obligations......................................................... 28
5.8 Subsidiaries.................................................................................. 29
5.9 ERISA......................................................................................... 29
5.10 Accuracy of Information....................................................................... 29
5.11 Regulation U.................................................................................. 29
5.12 Material Agreements........................................................................... 29
5.13 Compliance With Laws.......................................................................... 29
5.14 Plan Assets; Prohibited Transactions.......................................................... 29
5.15 Environmental Matters......................................................................... 30
5.16 Investment Company Act........................................................................ 30
5.17 Public Utility Holding Company Act............................................................ 30
5.18 Insurance..................................................................................... 30
ARTICLE VI. COVENANTS................................................................................. 30
6.1 Financial Reporting........................................................................... 30
6.2 Use of Proceeds............................................................................... 31
6.3 Notice of Default............................................................................. 32
6.4 Conduct of Business........................................................................... 32
6.5 Taxes......................................................................................... 32
6.6 Insurance..................................................................................... 32
-ii-
TABLE OF CONTENTS
(continued)
PAGE
6.7 Compliance with Laws.......................................................................... 32
6.8 Maintenance of Properties..................................................................... 32
6.9 Inspection.................................................................................... 33
6.10 Merger........................................................................................ 33
6.11 Sale of Assets................................................................................ 33
6.12 Debt to Capitalization Ratio.................................................................. 34
6.13 Liens......................................................................................... 34
6.14 Intercompany Transactions..................................................................... 35
6.15 Off-Balance Sheet Liabilities................................................................. 35
ARTICLE VII. DEFAULTS.................................................................................. 36
ARTICLE VIII. ACCELERATION, WAIVERS, AMENDMENTS AND REMEDIES............................................ 38
8.1 Acceleration; Letter of Credit Collection Account............................................. 38
8.2 Amendments.................................................................................... 39
8.3 Preservation of Rights........................................................................ 40
ARTICLE IX. GENERAL PROVISIONS........................................................................ 40
9.1 Survival of Representations................................................................... 40
9.2 Governmental Regulation....................................................................... 40
9.3 Headings...................................................................................... 40
9.4 Entire Agreement.............................................................................. 40
9.5 Several Obligations; Benefits of this Agreement............................................... 40
9.6 Expenses; Indemnification..................................................................... 41
9.7 Numbers of Documents.......................................................................... 41
9.8 Accounting.................................................................................... 41
9.9 Severability of Provisions.................................................................... 42
9.10 Nonliability of Lenders....................................................................... 42
9.11 Limited Disclosure............................................................................ 42
9.12 Nonreliance................................................................................... 43
9.13 Disclosure.................................................................................... 43
ARTICLE X. THE AGENT................................................................................. 43
10.1 Appointment; Nature of Relationship........................................................... 43
-iii-
TABLE OF CONTENTS
(continued)
PAGE
10.2 Powers........................................................................................ 43
10.3 General Immunity.............................................................................. 44
10.4 No Responsibility for Loans, Recitals, etc.................................................... 44
10.5 Action on Instructions of Lenders............................................................. 44
10.6 Employment of Agents and Counsel.............................................................. 44
10.7 Reliance on Documents; Counsel................................................................ 44
10.8 Agent's Reimbursement and Indemnification..................................................... 45
10.9 Notice of Default............................................................................. 45
10.10 Rights as a Lender............................................................................ 45
10.11 Lender Credit Decision........................................................................ 45
10.12 Successor Agent............................................................................... 46
10.13 Agent's Fee................................................................................... 46
10.14 Delegation to Affiliates...................................................................... 46
10.15 Syndication Agent, Documentation Agents....................................................... 47
ARTICLE XI. SETOFF; RATABLE PAYMENTS.................................................................. 47
11.1 Setoff........................................................................................ 47
11.2 Ratable Payments.............................................................................. 47
ARTICLE XII. BENEFIT OF AGREEMENT; ASSIGNMENTS; PARTICIPATIONS......................................... 47
12.1 Successors and Assigns........................................................................ 47
12.2 Participations................................................................................ 48
12.2.1 Permitted Participants; Effect....................................................... 48
12.2.2 Voting Rights........................................................................ 48
12.2.3 Benefit of Setoff.................................................................... 48
12.3 Assignments................................................................................... 49
12.3.1 Permitted Assignments................................................................ 49
12.3.2 Effect; Effective Date............................................................... 49
12.4 Dissemination of Information.................................................................. 49
12.5 Tax Treatment................................................................................. 50
ARTICLE XIII. NOTICES................................................................................... 50
13.1 Notices....................................................................................... 50
-iv-
TABLE OF CONTENTS
(continued)
PAGE
13.2 Change of Address............................................................................. 50
ARTICLE XIV. COUNTERPARTS.............................................................................. 50
ARTICLE XV. CHOICE OF LAW; CONSENT TO JURISDICTION; WAIVER OF JURY TRIAL; MAXIMUM INTEREST RATE....... 50
15.1 CHOICE OF LAW................................................................................. 50
15.2 CONSENT TO JURISDICTION....................................................................... 51
15.3 WAIVER OF JURY TRIAL.......................................................................... 51
15.4 Maximum Interest Rate......................................................................... 51
SCHEDULES
I Pricing Schedule
II Commitments
5.7 Litigation and Contingent Liabilities
5.15 Environmental Matters
6.13 Existing Liens
6.15 Off-Balance Sheet Liabilities
13.1 Notices
EXHIBITS
A-1 Form of Opinion of Counsel to the Borrower (New Mexico)
A-2 Form of Opinion of Counsel to the Borrower (Illinois)
B Form of Assignment Agreement
C Form of Money Transfer Instructions
D Form of Note
E Form of Compliance Certificate
-v-