Exhibit 10(c)
[EXECUTION VERSION]
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LOC 2003 TRUST
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$500,000,000
CREDIT AGREEMENT
Dated as of August 8, 2003
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CREDIT SUISSE FIRST BOSTON
as Administrative Agent and Collateral Agent
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Co-Lead Arrangers and Co-Book Managers
CREDIT SUISSE FIRST BOSTON
and
J.P. MORGAN SECURITIES, INC.
Syndication Agent
J.P. MORGAN SECURITIES, INC.
Documentation Agent
CITIBANK, N.A.
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TABLE OF CONTENTS
Page
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Article I DEFINITIONS; CONSTRUCTION.....................................................1
SECTION 1.01. Defined Terms. ................................................................................1
SECTION 1.02. Terms Generally. ..............................................................................9
Article II THE EXTENSIONS OF CREDIT ....................................................9
SECTION 2.01. Commitments. ..................................................................................9
SECTION 2.02. Loans. ........................................................................................9
SECTION 2.03. Borrowing Procedure. .........................................................................11
SECTION 2.04. Letters of Credit ............................................................................11
SECTION 2.05. Fees. ........................................................................................13
SECTION 2.06. Repayment of Outstanding Credits; Evidence of Indebtedness. ..................................13
SECTION 2.07. Interest on Loans. ...........................................................................14
SECTION 2.08. Default Interest. ............................................................................15
SECTION 2.09. Alternate Rate of Interest. ..................................................................15
SECTION 2.10. Termination and Reduction of Commitments. ....................................................15
SECTION 2.11. Prepayment. ..................................................................................16
SECTION 2.12. Reserve Requirements; Change in Circumstances. ...............................................17
SECTION 2.13. Change in Legality. ..........................................................................18
SECTION 2.14. Pro Rata Treatment. ..........................................................................19
SECTION 2.15. Sharing of Setoffs. ..........................................................................19
SECTION 2.16. Payments. ....................................................................................20
SECTION 2.17. Taxes. .......................................................................................21
SECTION 2.18. Assignment of Commitments Under Certain Circumstances. .......................................23
Article III REPRESENTATIONS AND WARRANTIES ............................................24
SECTION 3.01. Organization; Powers. ........................................................................24
SECTION 3.02. Authorization. ...............................................................................24
SECTION 3.03. Enforceability. ..............................................................................24
SECTION 3.04. Security Interests. ..........................................................................24
SECTION 3.05. Governmental Approvals. ......................................................................25
SECTION 3.06. Financial Statements. ........................................................................25
SECTION 3.07. Litigation. ..................................................................................25
SECTION 3.08. Federal Reserve Regulations. .................................................................25
SECTION 3.09. Investment Company Act; Public Utility Holding Company Act. ..................................26
SECTION 3.10. No Material Misstatements. ...................................................................26
SECTION 3.11. Taxes. .......................................................................................26
SECTION 3.12. Borrower Activities. .........................................................................26
SECTION 3.13. Solvency .....................................................................................26
Article IV CONDITIONS .................................................................27
SECTION 4.01. Conditions for the Commitments. ..............................................................27
SECTION 4.02. Conditions for Initial Extension of Credit. ..................................................28
SECTION 4.03. Conditions for All Extensions of Credit. .....................................................29
i
Article V COVENANTS ...................................................................29
SECTION 5.01. Existence, Preservation of Rights and Modifications of Governing Instruments. ................29
SECTION 5.02. Performance Under Parent Facility. ...........................................................29
SECTION 5.03. Compliance with Law. .........................................................................30
SECTION 5.04. Financial Statements, Reports, Etc. ..........................................................30
SECTION 5.05. Taxes, Etc. ..................................................................................31
SECTION 5.06. Maintenance and Preparation of Records; Access to Properties and Inspections. ................31
SECTION 5.07. Consolidated Financial Statements. ...........................................................31
SECTION 5.08. Use of Proceeds. .............................................................................32
SECTION 5.09. Consolidations, Mergers, Sales and Acquisitions of Assets, Creation of
Subsidiaries and Assignments Under the Parent Facility. ....................................32
SECTION 5.10. Limitations on Liens. ........................................................................32
SECTION 5.11. Limitation on Activities. ....................................................................32
SECTION 5.12. Cash Collateral Requirement. .................................................................32
SECTION 5.13. Restricted Payments. .........................................................................32
SECTION 5.14. Maintenance of Accounts. .....................................................................33
SECTION 5.15. Bankruptcy. ..................................................................................33
SECTION 5.16. Commingling. .................................................................................33
SECTION 5.17. No Guaranties or Other Debt. .................................................................33
SECTION 5.18. Special Purpose Entity. ......................................................................34
SECTION 5.19. Compensation of Third Parties. ...............................................................34
SECTION 5.20. Allocation of Rent and Overhead. .............................................................34
SECTION 5.21. Allocation of Costs of Officers and Employees. ...............................................34
SECTION 5.22. Allocation of Costs of Joint Contracting. ....................................................34
SECTION 5.23. Allocation of Costs of Vendors and Service Providers. ........................................34
SECTION 5.24. Arm's-Length Transactions. ...................................................................34
Article VI THE ACCOUNTS ...............................................................35
SECTION 6.01. Establishment and Management of Accounts. ....................................................35
SECTION 6.02. The Revenue Account. .........................................................................36
SECTION 6.03. The Cash Collateral Accounts. ................................................................38
SECTION 6.04. Prepayments and Deposits of Cash Collateral at the Request of the Borrower. ..................40
Article VII EVENTS OF DEFAULT .........................................................40
Article VIII THE AGENTS ...............................................................42
SECTION 8.01. The Agents Generally. ........................................................................42
SECTION 8.02. Replacement of Agents. .......................................................................45
SECTION 8.03. Rights and Duties of the Collateral Agent. ...................................................45
ii
Article IX MISCELLANEOUS ...............................................................47
SECTION 9.01. Notices. .....................................................................................47
SECTION 9.02. Survival of Agreement. .......................................................................47
SECTION 9.03. Binding Effect. ..............................................................................48
SECTION 9.04. Successors and Assigns. ......................................................................48
SECTION 9.05. Expenses; Indemnity. .........................................................................50
SECTION 9.06. Limitation on Liability of the Trustee. ......................................................52
SECTION 9.07. Right of Setoff. .............................................................................52
SECTION 9.08. Applicable Law. ..............................................................................53
SECTION 9.09. Waivers; Amendment. ..........................................................................53
SECTION 9.10. Entire Agreement. ............................................................................53
SECTION 9.11. Severability. ................................................................................54
SECTION 9.12. Counterparts. ................................................................................54
SECTION 9.13. Headings. ....................................................................................54
SECTION 9.14. Interest Rate Limitation. ....................................................................54
SECTION 9.15. Jurisdiction; Venue. .........................................................................55
SECTION 9.16. Confidentiality. .............................................................................55
EXHIBITS AND SCHEDULES
Exhibit A - Form of Borrowing Request
Exhibit B - Form of Request for Issuance
Exhibit C - Form of Pledge Agreement
Exhibit D - Form of Security Agreement
Exhibit E - Form of Control Agreement
Exhibit F - Form of Assignment and Acceptance
Exhibit G - Form of Promissory Note
Exhibit H - Form of Cash Collateral Value Report
Exhibit I - Form of Investment Instructions
Schedule 1 - Commitments
Schedule 2 - Permitted Investments
iii
CREDIT AGREEMENT (this "Agreement"), dated as of August 8,
2003, among LOC 2003 TRUST, a Delaware statutory trust (the
"Borrower"), the lenders listed in Schedule 1 (together with
their successors and assigns, the "Lenders") and CREDIT SUISSE
FIRST BOSTON ("CSFB"), as administrative agent for the Lenders
(in such capacity, the "Administrative Agent") and as
collateral agent for the Lenders (in such capacity, the
"Collateral Agent", and, together with the Administrative
Agent, the "Agents").
PRELIMINARY STATEMENT
The Borrower has requested that the Lenders provide a credit facility
for the making of loans to the Borrower and the issuance of letters of credit to
beneficiaries designated by the Borrower in an aggregate amount not in excess of
$500,000,000. The Lenders have agreed to make such a credit facility available
on the terms and conditions set forth herein, and CSFB has agreed to act as
Administrative Agent and Collateral Agent under such credit facility on behalf
of the Lenders.
Accordingly, the parties hereby agree as follows.
Article I
DEFINITIONS; CONSTRUCTION
SECTION 1.01. Defined Terms.
As used in this Agreement, the following terms shall have the meanings
specified below:
"ABR Borrowing" shall mean a Borrowing comprised of ABR Loans.
"ABR Loan" shall mean any Loan bearing interest at a rate
determined by reference to the Alternate Base Rate in accordance with
the provisions of Article II or any Eurodollar Loan converted (pursuant
to Section 2.09 or 2.13(a)(ii)) to a loan bearing interest at a rate
determined by reference to the Alternate Base Rate.
"Acceleration" shall mean the termination of the Total
Commitment and the acceleration of the maturity of the Loans (whether
automatically or upon a declaration by the Administrative Agent)
pursuant to Article VII.
"Accounts" shall have the meaning given such term in Section
6.01(a).
"Administration Agreement" means that certain Administrative
Services Agreement, dated as of the date hereof, between the Borrower
and the Administrator.
"Administrative Agent" shall have the meaning given such term
in the preamble hereto.
"Administrative Fees" shall have the meaning given such term
in Section 2.05(c).
2
"Administrator" shall mean TXU Business Services Company, in
its capacity as administrator under the Administration Agreement, and
its successors and assigns.
"Affiliate" shall mean, when used with respect to a specified
person, another person that directly or indirectly controls or is
controlled by or is under common control with the person specified.
"Agents" shall have the meaning given such term in the
preamble hereto.
"Agreement" shall have the meaning given such term in the
preamble hereto.
"Alternate Base Rate" shall mean, for any day, a rate per
annum (rounded upwards, if necessary, to the next 1/16 of 1%) equal to
the greater of (i) the Federal Funds Effective Rate in effect on such
day plus 0.50% and (ii) the Prime Rate in effect on such day. If for
any reason the Administrative Agent shall have determined (which
determination shall be conclusive absent manifest error; provided that
the Administrative Agent shall, upon request, provide to the Borrower a
certificate setting forth in reasonable detail the basis for such
determination) that it is unable to ascertain the Federal Funds
Effective Rate for any reason, including the inability of the
Administrative Agent to obtain sufficient quotations in accordance with
the terms thereof, the Alternate Base Rate shall be determined without
regard to clause (i) of the first sentence of this definition until the
circumstances giving rise to such inability no longer exist. Any change
in the Alternate Base Rate due to a change in the Prime Rate or the
Federal Funds Effective Rate shall be effective on the effective date
of such change in the Prime Rate or the Federal Funds Effective Rate,
respectively.
"Applicable Margin" shall mean 0.15% per annum.
"Assignment and Acceptance" shall mean an assignment and
acceptance entered into by a Lender and an assignee in the form of
Exhibit F.
"Board" shall mean the Board of Governors of the Federal
Reserve System of the United States.
"Borrower" shall have the meaning given such term in the
preamble hereto.
"Borrowing" shall mean a group of Loans of a single Type made
by one or more of the Lenders on a single date and as to which a single
Interest Period is in effect.
"Borrowing Request" shall mean a request made pursuant to
Section 2.03 in the form of Exhibit A.
"Business Day" shall mean any day (other than a day that is a
Saturday, Sunday or legal holiday in the City or State of New York) on
which banks are open for business in New York City; provided, however,
that, when used in connection with a Eurodollar Loan, the term
"Business Day" shall also exclude any day on which banks are not open
for dealings in dollar deposits in the London interbank market.
3
"Cash Collateral Account" shall have the meaning given such
term in Section 6.01(a).
"Cash Collateral Requirement" shall mean, at any time and for
any Lender, an amount equal to the sum of (i) 105% of the unused
portion of such Lender's Commitment at such time and (ii) 105% of such
Lender's Outstanding Credits at such time.
"Cash Collateral Value" shall mean, at any time and for any
Lender, the value (calculated in accordance with Section 6.01(f)) of
the Collateral held in such Lender's Cash Collateral Account at such
time.
A "Change in Control" shall be deemed to have occurred if TXU
shall cease to be the beneficial owner of 100% of the beneficial
interests in the Borrower.
"Closing Date" shall have the meaning specified in Section
4.01(a).
"Code" shall mean the Internal Revenue Code of 1986, as the
same may be amended from time to time.
"Collateral" shall mean all or any of the collateral pledged
pursuant to the Security Documents.
"Commitment" shall mean, with respect to each Lender, the
commitment of such Lender in the amount set forth in Schedule 1 hereto
to make Loans and, in such Lender's capacity as an LC Bank, to issue
Letters of Credit, as such Commitment may be permanently terminated or
reduced from time to time pursuant to Section 2.10 or Article VII or
modified from time to time pursuant to Section 9.04.
"Commitment Fee" shall have the meaning given such term in
Section 2.05(a).
"Control Agreement" shall mean a control agreement among the
Borrower, The Bank of New York and the Collateral Agent, in
substantially the form of Exhibit E.
"CSFB" shall have the meaning given such term in the preamble
hereto.
"Default" shall mean any event or condition that upon notice,
lapse of time or both would constitute an Event of Default.
"dollars" or "$" shall mean lawful money of the United States
of America.
"Eurodollar Borrowing" shall mean a Borrowing comprised of
Eurodollar Loans.
"Eurodollar Loan" shall mean any Loan bearing interest at a
rate determined by reference to the LIBO Rate in accordance with the
provisions of Article II.
"Event of Default" shall have the meaning given such term in
Article VII.
"Extension of Credit" means (i) the making of a Loan or (ii)
the issuance of a Letter of Credit or the amendment of any Letter of
Credit having the effect of extending the stated termination date
thereof or increasing the maximum amount available to be drawn
thereunder and the Outstanding Credits resulting from any of the
foregoing actions.
4
"Federal Funds Effective Rate" shall mean, for any day, the
weighted average of the rates on overnight Federal funds transactions
with members of the Federal Reserve System arranged by Federal funds
brokers, as released on the next succeeding Business Day by the Federal
Reserve Bank of New York, or, if such rate is not so released for any
day that is a Business Day, the arithmetic average, as determined by
the Administrative Agent, of the quotations for the day of such
transactions received by the Administrative Agent from three Federal
funds brokers of recognized standing selected by it.
"Fees" shall mean the Commitment Fees, the LC Fees and the
Administrative Fees.
"Financial Officer" shall mean any person designated by the
Trust to be responsible for managing the financial affairs of the
Borrower.
"Funding Date" shall have the meaning specified in Section
4.02.
"GAAP" shall mean generally accepted accounting principles,
applied on a consistent basis.
"Governing Instruments" shall mean the Trust Agreement, the
certificate of trust of the Borrower and the Administration Agreement.
"Governmental Authority" shall mean any Federal, state, local
or foreign court or governmental agency, authority, instrumentality or
regulatory body.
"Indebtedness" of any person shall mean all indebtedness
representing money borrowed that is created, assumed, incurred or
guaranteed in any manner by such person or for which such person is
responsible or liable (whether by agreement to purchase indebtedness
of, or to supply funds to or invest in, others or otherwise).
"Interest Payment Date" shall mean, with respect to any Loan,
the last day of the Interest Period applicable thereto and, in the case
of a Eurodollar Loan with an Interest Period of more than three months'
duration, each day that would have been an Interest Payment Date for
such Loan had successive Interest Periods of three months' duration
been applicable to such Loan and, in addition, the date of any
prepayment of each Loan or conversion of such Loan to a Loan of a
different Type.
"Interest Period" shall mean (i) as to any Eurodollar
Borrowing, the period commencing on the date of such Borrowing and
ending on the numerically corresponding day (or, if there is no
numerically corresponding day, on the last day) in the calendar month
that is 1, 2, 3 or 6 months thereafter; provided that, in the case of
any Eurodollar Borrowing made during the 30 day period ending on the
Maturity Date, such period may end on the seventh or fourteenth day
thereafter as the Borrower may elect, (ii) as to any ABR Borrowing, the
period commencing on the date of such Borrowing and ending on the
earliest of (A) the next succeeding March 31, June 30, September 30 or
December 31, (B) the Maturity Date and (C) the date such Borrowing is
repaid or prepaid in accordance with Section 2.06 or Section 2.11;
provided, however, that if any Interest Period would end on a day other
than a Business Day, such Interest Period shall be extended to the next
succeeding Business Day unless, in the case of Eurodollar Loans only,
such next succeeding Business Day would fall in the next calendar
month, in which case such Interest Period shall end on the next
preceding Business Day. Interest shall accrue from and including the
first day of an Interest Period to but excluding the last day of such
Interest Period.
5
"LC Bank" shall mean each Lender, in its capacity as issuer of
any Letter of Credit, provided, that each Lender may, in its
discretion, arrange for one or more Letters of Credit to be issued by
any of its Affiliates having credit ratings acceptable to the Borrower,
in which case the term "LC Bank" shall include any such Affiliate with
respect to Letters of Credit issued by such Affiliate.
"LC Fee" shall have the meaning given such term in Section
2.05(b).
"LC Outstandings" shall mean, on any date of determination and
with respect to any LC Bank, the sum of (i) the undrawn stated amounts
of all Letters of Credit issued by such LC Bank that are outstanding on
such date and (ii) the aggregate principal amount of all unpaid
reimbursement obligations of the Borrower on such date with respect to
payments made by such LC Bank under Letters of Credit (excluding
reimbursement obligations that have been repaid with the proceeds of
any Loan) issued by such LC Bank.
"Lenders" shall have the meaning given such term in the
preamble hereto.
"Letter Agreement" means that certain fee letter agreement,
dated as of the date hereof, between the Borrower and CSFB, as amended,
modified or supplemented from time to time.
"Letter of Credit" means a letter of credit that is issued by
an LC Bank pursuant to Section 2.04, as such letter of credit may from
time to time be amended, modified or extended in accordance with the
terms of this Agreement.
"LIBO Rate" shall mean, with respect to any Eurodollar
Borrowing for any Interest Period, the rate appearing on Page 3750 of
the Telerate Service (or on any successor or substitute page of such
service, or any successor to or substitute for such service, providing
rate quotations comparable to those currently provided on such page of
such service, as determined by the Administrative Agent from time to
time for purposes of providing quotations of interest rates applicable
to dollar deposits in the London interbank market) at approximately
11:00 a.m., London time, two Business Days prior to the commencement of
such Interest Period as the rate for dollar deposits with a maturity
comparable to such Interest Period. In the event that such rate is not
available at such time for any reason, then the "LIBO Rate" with
respect to such Eurodollar Borrowing for such Interest Period shall be
the rate at which dollar deposits of $5,000,000 and for a maturity
comparable to such Interest Period are offered by the principal London
office of the Administrative Agent in immediately available funds in
the London interbank market at approximately 11:00 a.m. London time,
two Business Days prior to the commencement of such Interest Period.
6
"Lien" shall mean, with respect to any asset, any mortgage,
lien, pledge, charge, security interest or encumbrance of any kind in
respect of such asset. For the purposes of this Agreement, any person
shall be deemed to own subject to a Lien any asset that it has acquired
or holds subject to the interest of a vendor or lessor under any
conditional sale agreement, capital lease or other title retention
agreement relating to such asset.
"Loan Document" shall mean this Agreement, any promissory
notes executed and delivered pursuant to Section 2.06(e) and the
Security Documents.
"Loans" shall mean the revolving loans made pursuant to
Section 2.03. Each Loan shall be a Eurodollar Loan or an ABR Loan.
"Margin Regulations" shall mean Regulations T, U and X of the
Board as from time to time in effect, and all official rulings and
interpretations thereunder or thereof.
"Margin Stock" shall have the meaning given such term under
Regulation U of the Board.
"Material Adverse Change" shall mean a materially adverse
change in the business, assets, operations or financial condition of
the Borrower that makes the Borrower unable to perform any of its
obligations under this Agreement or that impairs the rights of, or
benefits available to, the Lenders or any LC Bank under any Loan
Document.
"Maturity Date" shall mean the earliest to occur of (i) July
15, 2008, (ii) September 7, 2003, if the Funding Date shall not have
occurred prior to such date, and (iii) the date of termination or
reduction in whole of the Commitments pursuant to Section 2.10 or
Article VII.
"Moody's" shall mean Moody's Investors Service, Inc.
"Outstanding Credits" mean, on any date of determination and
with respect to any Lender, an amount equal to (i) the aggregate
principal amount of all Loans of such Lender outstanding on such date
plus (ii) the LC Outstandings of such Lender on such date.
"Parent Facility" means the Credit Agreement, dated the date
hereof, between the Borrower and TXU, as amended, supplemented and
modified from time to time in accordance with the terms thereof and
hereof.
"Percentage" means, for any Lender on any date of
determination, the percentage obtained by dividing such Lender's
Commitment on such date by the Total Commitment on such date.
7
"Permitted Investments" shall mean, for any Lender, the
investments specified for such Lender in Schedule 2, as such schedule
may be modified from time to time upon notice by such Lender and the
Borrower to the Collateral Agent; provided that all investments
specified in any such modification must consist of high-quality liquid
investments.
"person" shall mean any natural person, corporation, statutory
trust, joint venture, association, company, limited liability company,
partnership or government, or any agency or political subdivision
thereof.
"Pledge Agreement" shall mean each pledge and control
agreement among the Borrower, the Collateral Agent and CSFB, as
securities intermediary for the benefit of each Lender and the other
secured parties described therein, in substantially the form of Exhibit
C.
"Prime Rate" shall mean the rate of interest per annum
announced from time to time by the Administrative Agent as its base
rate in effect at its principal office in New York City; each change in
the Prime Rate shall be effective on the date such change is announced
as effective.
"Register" shall have the meaning given such term in Section
9.04(d).
"Request for Issuance" shall mean a request made pursuant to
Section 2.04(a) in the form of Exhibit B.
"Required Lenders" shall mean, at any time, Lenders having
Commitments representing in excess of 50% of the Total Commitment, or,
if the Total Commitment at such time has been terminated, Lenders
holding Outstanding Credits representing in excess of 50% of the
aggregate Outstanding Credits of all Lenders.
"Responsible Officer" shall mean the Administrator or the
Trustee.
"Restricted Payment" shall mean (i) any direct or indirect
distribution, dividend or payment to any person on account of any
beneficial interest in the Borrower, (ii) any payment on account of the
purchase, redemption, or other acquisition or retirement of any
beneficial interest in the Borrower and (iii) any payment of
management, consulting or other fees by the Borrower to TXU or any
Affiliate of TXU.
"Revenue Account" shall have the meaning given in Section
6.01(a).
"S&P" shall mean Standard & Poor's Ratings Services (a
division of The McGraw-Hill Companies, Inc.).
"Secured Parties" shall have the meaning assigned to that term
in the Security Agreement.
8
"Security Agreement" shall mean a security agreement by the
Borrower in favor of the Collateral Agent for the benefit of the
Secured Parties, in substantially the form of Exhibit D.
"Security Documents" shall mean the Security Agreement, each
Pledge Agreement and the Control Agreement.
"Shared Collateral" shall mean all Collateral other than the
Collateral pledged pursuant to the Pledge Agreements.
"Solvent" means, with respect to any person as of a particular
date, that on such date (i) the assets, at a fair valuation, of such
person will exceed its debts; (ii) such person has not incurred and
does not intend to incur, and does not believe that it will incur,
debts beyond its ability to pay such debts as such debts mature; and
(iii) such person will have sufficient capital with which to conduct
its business. For purposes of this definition, "debt" means any
liability on a claim, and "claim" means (A) right to payment from such
person, whether or not such a right is reduced to judgment against such
person, liquidated, unliquidated, fixed, contingent, matured,
unmatured, disputed, undisputed, legal, equitable, secured or unsecured
or (B) right to an equitable remedy for breach of performance by such
person if such breach gives rise to a payment from such person, whether
or not such right to an equitable remedy is reduced to judgment against
such person, whether fixed, contingent, matured, unmatured, disputed,
undisputed, secured or unsecured. The amount of unliquidated,
contingent, unmatured or disputed liabilities of any person at any time
shall be computed as the amount that, in the light of all the facts and
circumstances existing at such time, represents the amount that can
reasonably be expected to become an actual or matured liability.
"Subsidiary" shall mean, with respect to any person (the
"parent"), any corporation or other entity of which securities or other
ownership interests having ordinary voting power to elect a majority of
the board of directors or other persons performing similar functions
are at the time directly or indirectly owned by such parent.
"Total Commitment" shall mean, at any time, the aggregate
amount of Commitments of all the Lenders, as in effect at such time.
"Total LC Outstandings" shall mean, on any date of
determination, the aggregate amount of LC Outstandings of all the LC
Banks on such date.
"Trust Agreement" shall mean the Trust Agreement (LOC 2003
Trust), dated as of July 28, 2003, between Wilmington Trust Company, as
trustee, and TXU, as beneficial owner.
"Trustee" shall mean Wilmington Trust Company, a Delaware
banking corporation, not in its individual capacity but solely in its
capacity as trustee under the Governing Instruments, and its successors
and assigns.
"Trustee Fee Letter" shall mean the Fee and Indemnity
Agreement, dated as of July 28, 2003, between the Borrower and
Wilmington Trust Company.
9
"TXU" shall mean TXU Corp., a Texas corporation, and its
successors.
"Type", when used with respect to any Loan or Borrowing, shall
refer to the rate (LIBO Rate or Alternate Base Rate) by reference to
which interest on such Loan or on the Loans comprising such Borrowing
is determined.
"Unused Percentage" means, for any Lender on any date of
determination, the percentage obtained by dividing the unused portion
of such Lender's Commitment on such date by the unused portion of the
Total Commitment on such date.
SECTION 1.02. Terms Generally.
The definitions in Section 1.01 shall apply equally to both the
singular and plural forms of the terms defined. Whenever the context may
require, any pronoun shall include the corresponding masculine, feminine and
neuter forms. The words "include", "includes" and "including" shall be deemed to
be followed by the phrase "without limitation." All references herein to
Articles, Sections, Exhibits and Schedules shall be deemed references to
Articles and Sections of, and Exhibits and Schedules to, this Agreement unless
the context shall otherwise require. Except as otherwise expressly provided
herein, all terms of an accounting or financial nature shall be construed in
accordance with GAAP, as in effect from time to time.
Article II
THE EXTENSIONS OF CREDIT
SECTION 2.01. Commitments.
Subject to the terms and conditions and relying upon the
representations and warranties herein set forth, each Lender agrees, severally
and not jointly, to make Loans to the Borrower in an aggregate principal amount
at any time outstanding not to exceed the lesser of (i) 50% of such Lender's
Commitment and (ii) 100% of the unused portion of such Lender's Commitment, and
each LC Bank, severally and not jointly, agrees to issue Letters of Credit for
the account of the Borrower at any time and from time to time until the fifth
Business Day preceding the Maturity Date in an aggregate stated amount at any
time outstanding not to exceed 100% of the unused portion of such Lender's
Commitment, subject, however, to the conditions that at no time shall the
Outstanding Credits of any Lender exceed the amount of such Lender's Commitment
unless no Loans of such Lender are outstanding and such Lender's Cash Collateral
Value is at least equal to such Lender's Cash Collateral Requirement.
Within the foregoing limits, the Borrower may borrow, pay or prepay
and, subject to the limitations set forth in Section 2.11(a), reborrow Loans
hereunder and request the issuance, extension and modification of Letters of
Credit, on and after the date hereof and prior to the Maturity Date, subject to
the terms, conditions and limitations set forth herein.
SECTION 2.02. Loans.
(a) Each Loan shall be made as part of a Borrowing consisting of Loans
made by the Lenders ratably in accordance with their respective Unused
Percentages; provided, however, that the failure of any Lender to make any Loan
shall not in itself relieve any other Lender of its obligation to lend hereunder
(it being understood, however, that no Lender shall be responsible for the
failure of any other Lender to make any Loan required to be made by such other
Lender). Each Loan shall be made in accordance with the procedures set forth in
Section 2.03. The Loan or Loans comprising any Borrowing shall be in an
aggregate principal amount that is an integral multiple of $5,000,000 and not
less than $25,000,000 (or an aggregate principal amount equal to the remaining
balance of the available Commitments).
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(b) Each Borrowing shall be comprised entirely of Eurodollar Loans or
ABR Loans (except as otherwise required by Section 2.13(a)(i)), as the Borrower
may request pursuant to Section 2.03. Each Lender may at its option make any
Eurodollar Loan by causing any domestic or foreign branch or Affiliate of such
Lender to make such Loan; provided that any exercise of such option shall not
affect the obligation of the Borrower to repay such Loan in accordance with the
terms of this Agreement. Borrowings of more than one Type may be outstanding at
the same time, but no more than seven Eurodollar Borrowings may be outstanding
at any time.
(c) Subject to subsection (d) below, each Lender shall make each Loan
to be made by it hereunder on the proposed date thereof by wire transfer of
immediately available funds to the Administrative Agent in New York, New York,
not later than noon, New York City time, and the Administrative Agent shall by
2:00 p.m., New York City time, credit the amounts so received to the account
specified from time to time in one or more notices delivered by the Borrower to
the Administrative Agent or, if a Borrowing shall not occur on such date because
any condition precedent herein specified shall not have been met, return the
amounts so received to the respective Lenders. Loans shall be made by the
Lenders pro rata in accordance with their respective Unused Percentages. Unless
the Administrative Agent shall have received notice from a Lender prior to the
date of any Borrowing that such Lender will not make available to the
Administrative Agent such Lender's portion of such Borrowing, the Administrative
Agent may assume that such Lender has made such portion available to the
Administrative Agent on the date of such Borrowing in accordance with this
subsection (c), and the Administrative Agent may, in reliance upon such
assumption, make available to the Borrower on such date a corresponding amount.
If and to the extent that such Lender shall not have made such portion available
to the Administrative Agent, such Lender and the Borrower (without waiving any
claim against such Lender for such Lender's failure to make such portion
available) severally agree to repay to the Administrative Agent forthwith on
demand such corresponding amount together with interest thereon, for each day
from the date such amount is made available to the Borrower until the date such
amount is repaid to the Administrative Agent at (i) in the case of the Borrower,
the interest rate applicable at the time to the Loans comprising such Borrowing
and (ii) in the case of such Lender, the Federal Funds Effective Rate for the
first three days and at the Alternate Base Rate, thereafter. If such Lender
shall repay to the Administrative Agent such corresponding amount, such amount
shall constitute such Lender's Loan as part of such Borrowing for purposes of
this Agreement.
(d) The Borrower may refinance all or any part of any Borrowing with a
Borrowing of the same or a different Type, subject to the conditions and
limitations set forth in this Agreement. Any Borrowing or part thereof so
refinanced shall be deemed to be repaid or prepaid in accordance with Section
2.06 or 2.11, as applicable, with the proceeds of a new Borrowing, and the
proceeds of the new Borrowing, to the extent they do not exceed the principal
amount of the Borrowing being refinanced, shall not be paid by the Lenders to
the Administrative Agent or by the Administrative Agent to the Borrower pursuant
to subsection (c) above.
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SECTION 2.03. Borrowing Procedure.
In order to request a Borrowing, the Borrower shall provide the
Administrative Agent, via hand delivery, telecopy or telephone (promptly
confirmed via telecopy), a duly completed Borrowing Request in the form of
Exhibit A (a) in the case of a Eurodollar Borrowing, not later than 11:00 a.m.,
New York City time, three Business Days before such Borrowing, and (b) in the
case of an ABR Borrowing, not later than 11:00 a.m., New York City time, one
Business Day before such Borrowing. Such notice shall be irrevocable and shall
in each case specify (i) whether the Borrowing then being requested is to be a
Eurodollar Borrowing or an ABR Borrowing; (ii) the date of such Borrowing (which
shall be a Business Day) and the amount thereof; and (iii) if such Borrowing is
to be a Eurodollar Borrowing, the Interest Period with respect thereto, which
shall not end after the Maturity Date. If no election as to the Type of
Borrowing is specified in any such notice, then the requested Borrowing shall be
an ABR Borrowing. If no Interest Period with respect to any Eurodollar Borrowing
is specified in any such notice, then the Borrower shall be deemed to have
selected an Interest Period of one month's duration (subject to the limitations
set forth in the definition of "Interest Period"). If the Borrower shall not
have given notice in accordance with this Section 2.03 of its election to
refinance a Borrowing prior to the end of the Interest Period in effect for such
Borrowing, then the Borrower shall (unless such Borrowing is repaid at the end
of such Interest Period) be deemed to have given notice of an election to
refinance such Borrowing with an ABR Borrowing. Notwithstanding any other
provision of this Agreement to the contrary, no Borrowing shall be requested if
the Interest Period with respect thereto would end after the Maturity Date. The
Administrative Agent shall promptly advise the Lenders of any notice given
pursuant to this Section 2.03 and of each Lender's portion of the requested
Borrowing.
SECTION 2.04. Letters of Credit
(a) Subject to the terms and conditions hereof, each Letter of Credit
shall be issued (or the stated maturity thereof extended or terms thereof
modified or amended) on not less than three Business Days' prior notice
thereof by the delivery by the Borrower of a Request for Issuance to
the Administrative Agent and the applicable LC Bank. Each Request for
Issuance shall specify (i) the identity of the LC Bank, (ii) the date
(which shall be a Business Day) of issuance of such Letter of Credit
(or the date of effectiveness of such extension, modification or
amendment) and the stated expiry date thereof (which shall be no later
than the fifth Business Day preceding the Maturity Date), (iii) the
proposed stated amount (denominated in dollars) of such Letter of
Credit (which shall not be less than $1,000,000, unless otherwise
agreed to by the LC Bank), (iv) the name and address of the beneficiary
of such Letter of Credit and (v) a statement of drawing conditions
applicable to such Letter of Credit, and if such Request for Issuance
relates to an amendment or modification of a Letter of Credit, it shall
be accompanied by the consent of the beneficiary of the Letter of
Credit thereto. Each Request for Issuance shall be irrevocable unless
modified or rescinded by the Borrower not less than two days prior to
the proposed date of issuance (or effectiveness) specified therein. Not
later than 12:00 noon (New York City time) on the proposed date of
issuance (or effectiveness) specified in such Request for Issuance, and
upon fulfillment of the applicable conditions precedent and the other
requirements set forth herein, such LC Bank shall issue (or extend,
amend or modify) such Letter of Credit and provide notice and a copy
thereof to the Administrative Agent, which shall promptly so notify the
Lenders. No LC Bank shall at any time be obligated to issue any Letter
of Credit if such issuance would conflict with any applicable
requirement of law.
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(b)The Borrower hereby agrees to pay to the account of each LC Bank on
each date on which such LC Bank shall pay any amount under any Letter
of Credit issued by such LC Bank a sum equal to the amount so paid.
(c) The payment obligations of the Borrower under this Agreement in
respect of any payment under any Letter of Credit shall be unconditional and
irrevocable, and shall be paid strictly in accordance with the terms of
this Agreement under all circumstances, including the following circumstances:
(i) any lack of validity or enforceability of any Loan Document or
any other agreement or instrument relating hereto or to such Letter of
Credit;
(ii) any amendment or waiver of, or any consent to departure from,
the terms of any Loan Document or such Letter of Credit;
(iii) the existence of any claim, set-off, defense or other right
that the Borrower may have at any time against any beneficiary, or any
transferee, of such Letter of Credit (or any persons for whom any such
beneficiary or any such transferee may be acting), the LC Bank that
issued such Letter of Credit, or any other person, whether in
connection with this Agreement, the transactions contemplated hereby or
by such Letter of Credit, or any unrelated transaction;
(iv) any statement or any other document presented under such Letter
of Credit proving to be forged, fraudulent, invalid or insufficient in
any respect or any statement therein being untrue or inaccurate in any
respect;
(v) payment in good faith by such LC Bank under the Letter of Credit
against presentation of a draft or certificate that does not comply
with the terms of such Letter of Credit; or
(vi) any other circumstance or happening whatsoever, whether or not
similar to any of the foregoing.
(d) The Borrower assumes all risks of the acts and omissions of any
beneficiary or transferee of any Letter of Credit. No LC Bank or Lender
nor any of their respective officers, directors, employees, agents or
Affiliates shall be liable or responsible for (i) the use that may be
made of such Letter of Credit or any acts or omissions of any
beneficiary or transferee thereof in connection therewith; (ii) the
validity, sufficiency or genuineness of documents, or of any
endorsement thereon, even if such documents should prove to be in any
or all respects invalid, insufficient, fraudulent or forged; (iii)
payment by any LC Bank against presentation of documents that do not
comply with the terms of such Letter of Credit, including failure of
any documents to bear any reference or adequate reference to such
Letter of Credit; or (iv) any other circumstances whatsoever in making
or failing to make payment under such Letter of Credit, except that the
Borrower shall have the right to bring suit against such LC Bank, and
such LC Bank shall be liable to the Borrower, to the extent of any
direct, as opposed to consequential, damages suffered by the Borrower
that the Borrower proves were caused by such LC Bank's willful
misconduct or gross negligence, including, in the case of the Borrower,
such LC Bank's willful failure to make timely payment under such Letter
of Credit following the presentation to it by the beneficiary thereof
of a draft and accompanying certificate(s) that strictly comply with
the terms and conditions of such Letter of Credit. In furtherance and
not in limitation of the foregoing, each LC Bank may accept sight
drafts and accompanying certificates presented under any Letter of
Credit issued by such LC Bank that appear on their face to be in order,
without responsibility for further investigation, regardless of any
notice or information to the contrary, and payment against such
documents shall not constitute willful misconduct or gross negligence
by such LC Bank.
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SECTION 2.05. Fees.
(a) The Borrower agrees to pay to the Administrative Agent for the
Account of each Lender on the last Business Day of each March, June, September
and December and on each date on which the Commitment of such Lender shall be
terminated or reduced as provided herein, a commitment fee (a "Commitment Fee")
equal to 0.10% per annum of the amount of the daily average amount of the
unused Commitment of such Lender during the period from and including, in the
case of such payment to be made on September 30, 2003, the date hereof, and, in
the case of each other payment, the preceding payment date, to and excluding
the date of such other payment. All Commitment Fees shall be computed on the
basis of the actual number of days elapsed in a year of 360 days. The Commitment
Fee due to each Lender shall commence to accrue on the date hereof and shall
cease to accrue on the date of termination of the Commitment of such Lender as
provided herein.
(b) The Borrower agrees to pay to each LC Bank on the last Business Day
of each March, June, September and December, a fee (the "LC Fee") equal to 0.15%
of the daily average face amounts of all Letters of Credit issued and
outstanding by such LC Bank during the period from and including, in the case
of such payment to be made on September 30, 2003, the date hereof, and, in the
case of each other payment, the preceding payment date, to and excluding the
date of such other payment. All LC Fees shall be computed on the basis of the
actual number of days elapsed in a year of 360 days.
(c) The Borrower agrees to pay the Administrative Agent and the
Collateral Agent, for their own accounts, the administrative and collateral
agency fees provided for in the Letter Agreement (the "Administrative Fees").
(d) All Fees shall be paid on the dates due, in immediately available
funds, to the Administrative Agent for distribution, if and as appropriate,
among the Lenders and the LC Banks. Once paid, none of the Fees shall be
refundable under any circumstances.
SECTION 2.06. Repayment of Outstanding Credits; Evidence of
Indebtedness.
(a) The outstanding principal balance of each Loan shall be due and
payable on the last day of the Interest Period applicable thereto and on the
Maturity Date.
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(b) Each Lender shall maintain in accordance with its usual practice
an account or accounts evidencing the indebtedness to such Lender (and to such
Lender in its capacity as an LC Bank) resulting from each Extension of Credit
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 under this Agreement.
(c) The Administrative Agent shall maintain accounts in which it will
record (i) the amount of each Extension of Credit made hereunder, the Type of
each Loan made and the Interest Period applicable thereto, (ii) the amount of
any principal or interest due and payable or to become due and payable from the
Borrower to each Lender hereunder, (iii) the amount of any Fees due and payable
or to become due and payable from the Borrower to each Lender, and (iv) the
amount of any sum received by the Administrative Agent hereunder from the
Borrower and each Lender's and LC Bank's share thereof.
(d) The entries made in the accounts maintained pursuant to subsections
(b) and (c) of this Section 2.06 shall, to the extent permitted by applicable
law, be prima facie evidence of the existence and amounts of the obligations
therein recorded; provided, however, that the failure of any Lender or LC Bank
or the Administrative Agent to maintain such accounts or any error therein shall
not in any manner affect the obligations of the Borrower to repay the
Outstanding Credits in accordance with their terms.
(e) Any Lender may request that any Loans made by it and the Borrower's
reimbursement obligations in respect of Letters of Credit issued by it be
evidenced by one or more promissory notes substantially in the form of Exhibit
G. In such event, the Borrower shall execute and deliver to such Lender one or
more notes payable to the order of such Lender and in a form approved by the
Administrative Agent. Thereafter, the Loans evidenced by such notes and interest
thereon shall at all times (including after assignment pursuant to Section 9.04)
be represented by one or more notes in such form payable to the order of the
payee named therein.
SECTION 2.07. Interest on Loans.
(a) Subject to the provisions of Section 2.08, the Loans comprising
each Eurodollar Borrowing shall bear interest (computed on the basis of the
actual number of days elapsed over a year of 360 days) at a rate per annum equal
to the LIBO Rate for the Interest Period in effect for such Borrowing plus the
Applicable Margin from time to time in effect.
(b) Subject to the provisions of Section 2.08, the Loans comprising
each ABR Borrowing shall bear interest (computed on the basis of the actual
number of days elapsed over a year of (i) 365 or 366 days, as the case may be,
for periods during which the Alternate Base Rate is determined by reference to
the Prime Rate and (ii) 360 days for other periods) at a rate per annum equal
to the Alternate Base Rate.
(c) Interest on each Loan shall be payable on each Interest Payment
Date applicable to such Loan except as otherwise provided in this Agreement. The
applicable LIBO Rate or Alternate Base Rate for each Interest Period or day
within an Interest Period, as the case may be, shall be determined by the
Administrative Agent, and such determination shall be conclusive absent manifest
error; provided that the Administrative Agent shall, upon request, provide to
the Borrower a certificate setting forth in reasonable detail the basis for such
determination.
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SECTION 2.08. Default Interest.
If the Borrower shall default in the payment of the principal of or
interest on any Loan, or of any Letter of Credit reimbursement obligation or
interest thereon, or any other amount becoming due hereunder, whether by
scheduled maturity, notice of prepayment, acceleration or otherwise, the
Borrower shall on demand from time to time from the Administrative Agent pay
interest, to the extent permitted by law, on such defaulted amount up to (but
not including) the date of actual payment (after as well as before judgment) at
a rate per annum (computed as provided in Section 2.07(b)) equal to the
Alternate Base Rate plus 2%.
SECTION 2.09. Alternate Rate of Interest.
In the event, and on each occasion, that on the day two Business Days
prior to the commencement of any Interest Period for a Eurodollar Borrowing the
Administrative Agent shall have determined (i) that dollar deposits in the
principal amounts of the Eurodollar Loans comprising such Borrowing are not
generally available in the London interbank market or (ii) that reasonable means
do not exist for ascertaining the LIBO Rate, the Administrative Agent shall, as
soon as practicable thereafter, give telecopy notice of such determination to
the Borrower and the Lenders. In the event of any such determination under
clause (i) or (ii) above, until the Administrative Agent shall have advised the
Borrower and the Lenders that the circumstances giving rise to such notice no
longer exist, any request by the Borrower for a Eurodollar Borrowing pursuant to
Section 2.03 shall be deemed to be a request for an ABR Borrowing. In the event
the Required Lenders notify the Administrative Agent that the rates at which
dollar deposits are being offered will not adequately and fairly reflect the
cost to such Lenders of making or maintaining Eurodollar Loans during such
Interest Period, the Administrative Agent shall notify the Borrower of such
notice, and until the Required Lenders shall have advised the Administrative
Agent that the circumstances giving rise to such notice no longer exist, any
request by the Borrower for a Eurodollar Borrowing shall be deemed a request for
an ABR Borrowing. Each determination by the Administrative Agent hereunder shall
be made in good faith and shall be conclusive absent manifest error; provided
that the Administrative Agent, shall, upon request, provide to the Borrower a
certificate setting forth in reasonable detail the basis for such determination.
SECTION 2.10. Termination and Reduction of Commitments.
(a) The Commitments shall be automatically terminated on the Maturity
Date.
(b) Upon at least two Business Days' prior irrevocable written notice
to the Administrative Agent, the Borrower may at any time in whole permanently
terminate, or from time to time in part permanently reduce, the Total
Commitment; provided, however, that (i) each partial reduction of the Total
Commitment shall be in an integral multiple of $10,000,000 and in a minimum
principal amount of $10,000,000 and (ii) no such termination or reduction shall
be made that would reduce the Commitment of any Lender to an amount less than
(A) the aggregate amount of Outstanding Credits of such Lender on the date of
such termination or reduction (after giving effect to any prepayment made on
such date pursuant to Section 2.11), unless (x) no Loans of such Lender shall
remain outstanding and (y) such Lender's Cash Collateral Value shall be at least
equal to such Lender's Cash Collateral Requirement upon giving effect to such
termination or reduction and any related prepayment or deposit of Collateral
pursuant to Sections 2.11(b) and 6.04, or (B) $50,000,000, unless the result of
such termination or reduction referred to in this clause (B) is to reduce the
Total Commitment to $0. The Administrative Agent shall advise the Lenders of any
notice given pursuant to this Section 2.10(b) and of each Lender's portion of
any such termination or reduction of the Total Commitment. Each reduction in the
Total Commitment under this subsection (b) shall be made ratably among the
Lenders in accordance with their respective Percentages.
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(c) If, on the second Business Day following any drawing under a Letter
of Credit, the Cash Collateral Value of the Collateral held in the Cash
Collateral Account of the Lender that issued such Letter of Credit is less than
the Cash Collateral Requirement of such Lender, the Commitment of such Lender
shall automatically and permanently reduce by an amount equal to the amount of
such drawing.
(d) On each day on which the Commitment (as defined in the Parent
Facility) is reduced, the Total Commitment shall automatically and permanently
reduce by an amount equal to such reduction. Each reduction in the Total
Commitment under this subsection (d) shall be made ratably among the Lenders in
accordance with their respective Percentages.
(e) The Borrower shall pay to the Administrative Agent for the account
of the Lenders, on the date of each termination or reduction of the Total
Commitment, the Commitment Fees on the amount of the Total Commitment so
terminated or reduced accrued through the date of such termination or reduction.
SECTION 2.11. Prepayment.
(a) The Borrower shall have the right at any time and from time to time
to prepay any Borrowing, in whole or in part, upon giving telecopy notice (or
telephone notice promptly confirmed by telecopy) to the Administrative Agent:
(i) before 11:00 a.m., New York City time, three Business Days prior to
prepayment, in the case of Eurodollar Loans, and (ii) before 11:00 a.m., New
York City time, one Business Day prior to prepayment, in the case of ABR Loans;
provided, however, that each partial prepayment shall be in an amount that is an
integral multiple of $10,000,000 and not less than $10,000,000. Each Borrowing
that is prepaid shall be prepaid ratably in accordance with each Lender's
percentage of the outstanding principal amount of such Borrowing.
(b) On the date of any termination or reduction of the Commitments
pursuant to Section 2.10, the Borrower shall, by delivering sufficient funds to
the Collateral Agent for application in accordance with Article VI, pay or
prepay so much of the Borrowings and/or deposit funds in each Lender's Cash
Collateral Account pursuant to Section 6.04 in an amount as shall be necessary
in order that (i) the Outstanding Credits of each Lender shall not exceed the
amount of such Lender's Commitment unless no Loans of such Lender shall be
outstanding and such Lender's Cash Collateral Value shall be at least equal to
such Lender's Cash Collateral Requirement, in each case, after giving effect to
such termination or reduction.
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(c) On the date of any ABR Borrowing, the Borrower shall prepay any
other ABR Borrowing that is outstanding on such date, subject, however, to the
rights of the Borrower to refinance such outstanding ABR Borrowing pursuant to
Section 2.02(d).
(d) Each notice of prepayment shall specify the prepayment date and the
principal amount of each Borrowing (or portion thereof) to be prepaid, shall be
irrevocable and shall commit the Borrower to prepay such Borrowing (or portion
thereof) by the amount stated therein on the date stated therein. All
prepayments under this Section 2.11 shall be subject to Section 9.05(b)(ii) but
otherwise shall be made without premium or penalty. All prepayments under this
Section 2.11 shall be accompanied by accrued interest on the principal amount
being prepaid to the date of payment.
SECTION 2.12. Reserve Requirements; Change in Circumstances.
(a) Notwithstanding any other provision herein, if after the date of
this Agreement any change in applicable law or regulation or in the
interpretation or administration thereof by any Governmental Authority charged
with the interpretation or administration thereof (whether or not having the
force of law) shall change the basis of taxation of payments to any Lender or
any LC Bank hereunder (except for changes in respect of taxes on the overall net
income of such Lender or LC Bank (as the case may be) or its lending office
imposed by the jurisdiction in which such Lender's or LC Bank's (as the case may
be) principal executive office or lending office is located), or shall result in
the imposition, modification or applicability of any reserve, special deposit or
similar requirement against assets of, deposits with or for the account of or
credit extended by any Lender or any LC Bank, or shall result in the imposition
on any Lender, any LC Bank or the London interbank market of any other condition
affecting this Agreement, such Lender's Commitment or any Extension of Credit
(other than an ABR Loan) made by such Lender or LC Bank, and the result of any
of the foregoing shall be to increase the cost to such Lender or LC Bank (as the
case may be) of making or maintaining any Extension of Credit (other than an ABR
Loan) or to reduce the amount of any sum received or receivable by such Lender
or LC Bank (as the case may be) hereunder (whether of principal, interest or
otherwise) by an amount deemed by such Lender or LC Bank (as the case may be) to
be material, then the Borrower shall, upon receipt of the notice and certificate
provided for in Section 2.12(c), promptly pay to such Lender or LC Bank (as the
case may be) such additional amount or amounts as will compensate such Lender or
LC Bank (as the case may be) for such additional costs incurred or reduction
suffered.
(b) If any Lender or any LC Bank shall have determined that the
adoption of any law, rule, regulation or guideline arising out of the July 1988
report of the Basle Committee on Banking Regulations and Supervisory Practices
entitled "International Convergence of Capital Measurement and Capital
Standards," or the adoption after the date hereof of any other law, rule,
regulation or guideline regarding capital adequacy, or any change in any of the
foregoing or in the interpretation or administration of any of the foregoing by
any Governmental Authority, central bank or comparable agency charged with the
interpretation or administration thereof, or compliance by any Lender or any LC
Bank (or any lending office of such Lender or LC Bank) or any Lender's or any
LC Bank's holding company with any request or directive regarding capital
adequacy (whether or not having the force of law) of any such authority, central
bank or comparable agency, has or would have the effect of reducing the rate of
return on such Lender's or LC Bank's (as the case may be) capital or on the
capital of such Lender's or LC Bank's (as the case may be) holding company, if
any, as a consequence of this Agreement, such Lender's Commitment or the
Extensions of Credit made by such Lender or LC Bank (as the case may be)
pursuant hereto to a level below that which such Lender or LC Bank (as the case
may be) or such Lender's or LC Bank's (as the case may be) holding company
could have achieved but for such adoption, change or compliance (taking into
consideration such Lender's or LC Bank's (as the case may be) policies and the
policies of such Lender's or LC Bank's (as the case may be) holding company with
respect to capital adequacy) by an amount deemed by such Lender or LC Bank (as
the case maybe) to be material, then from time to time such additional amount or
amounts as will compensate such Lender or LC Bank (as the case may be) for any
such reduction suffered will be paid by the Borrower to such Lender or LC Bank
(as the case may be).
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(c) A certificate of each Lender or LC Bank setting forth such amount
or amounts as shall be necessary to compensate such Lender or LC Bank (as the
case may be)or its holding company as specified in subsection (a) or (b) above,
as the case may be, and containing an explanation in reasonable detail of the
manner in which such amount or amounts shall have been determined, shall be
delivered to the Borrower and shall be conclusive absent manifest error. The
Borrower shall pay each Lender or LC Bank (as the case may be) the amount shown
as due on any such certificate delivered by it within 10 days after its receipt
of the same. Each Lender and each LC Bank shall give prompt notice to the
Borrower of any event of which it has knowledge, occurring after the date
hereof, that it has determined will require compensation by the Borrower
pursuant to this Section; provided, however, that failure by such Lender or LC
Bank to give such notice shall not constitute a waiver of such Lender's or LC
Bank's (as the case may be)right to demand compensation hereunder.
(d) Failure on the part of any Lender or any LC Bank to demand
compensation for any increased costs or reduction in amounts received or
receivable or reduction in return on capital with respect to any period shall
not constitute a waiver of such Lender's or LC Bank's (as the case may be) right
to demand compensation with respect to such period or any other period;
provided, however, that no Lender or LC Bank shall be entitled to compensation
under this Section 2.12 for any costs incurred or reductions suffered with
respect to any date unless it shall have notified the Borrower that it will
demand compensation for such costs or reductions under subsection (c) above not
more than 90 days after the later of (i) such date and (ii) the date on which it
shall have become aware of such costs or reductions. The protection of this
Section shall be available to each Lender and each LC Bank regardless of any
possible contention of the invalidity or inapplicability of the law, rule,
regulation, guideline or other change or condition that shall have occurred or
been imposed.
(e) Each Lender and LC Bank agrees that it will designate a different
lending office if such designation will avoid the need for, or reduce the amount
of, such compensation and will not, in the reasonable judgment of such Lender or
LC Bank (as the case may be), be disadvantageous to such Lender or LC Bank (as
the case may be).
SECTION 2.13. Change in Legality.
(a) Notwithstanding any other provision herein, if any change in any
law or regulation or in the interpretation thereof by any Governmental
Authority charged with the administration or interpretation thereof
shall make it unlawful for any Lender to make or maintain any
Eurodollar Loan or to give effect to its obligations as contemplated
hereby with respect to any Eurodollar Loan, then, by written notice to
the Borrower and to the Administrative Agent, such Lender may:
19
(i) declare that Eurodollar Loans will not thereafter be made by
such Lender hereunder, whereupon any request for a Eurodollar Borrowing
shall, as to such Lender only, be deemed a request for an ABR Loan
unless such declaration shall be subsequently withdrawn (any Lender
delivering such a declaration hereby agreeing to withdraw such
declaration promptly upon determining that such event of illegality no
longer exists); and
(ii) require that all outstanding Eurodollar Loans made by it be
converted to ABR Loans, in which event all such Eurodollar Loans shall
be automatically converted to ABR Loans as of the effective date of
such notice as provided in subsection (b) below.
In the event any Lender shall exercise its rights under paragraph (i) or (ii)
above, all payments and prepayments of principal that would otherwise have been
applied to repay the Eurodollar Loans that would have been made by such Lender
or the converted Eurodollar Loans of such Lender shall instead be applied to
repay the ABR Loans made by such Lender in lieu of, or resulting from the
conversion of, such Eurodollar Loans.
(b) For purposes of this Section 2.13, a notice by any Lender shall be
effective as to each Eurodollar Loan, if lawful, on the last day of the Interest
Period currently applicable to such Eurodollar Loan; in all other cases such
notice shall be effective on the date of receipt.
SECTION 2.14. Pro Rata Treatment.
Except as provided elsewhere in this Agreement with respect to the
reimbursement of draws under Letters of Credit and except as required under
Sections 2.02, 2.10(c), 2.11(a), 2.15, 2.18, 6.04 and 9.13, each Borrowing, each
payment or prepayment of principal of any Borrowing, each payment of interest on
the Loans, each reduction of the Commitments and each refinancing or conversion
of any Borrowing with a Borrowing of any Type, shall be allocated pro rata among
the Lenders in accordance with their respective Commitments (or, if such
Commitments shall have expired or been terminated, in accordance with the
respective principal amounts of their outstanding Loans, LC Outstandings or
Extensions of Credit, as applicable). Each payment of principal of any Borrowing
shall be allocated pro rata among the Lenders participating in such Borrowing in
accordance with the respective principal amounts of their outstanding Loans
comprising such Borrowing. Each payment of interest on any Borrowing shall be
allocated pro rata among the Lenders participating in such Borrowing in
accordance with the respective amounts of accrued and unpaid interest on their
outstanding Loans comprising such Borrowing. Each Lender agrees that in
computing such Lender's portion of any Borrowing to be made hereunder, the
Administrative Agent may, in its discretion, round each Lender's share of such
Borrowing to the next higher or lower whole dollar amount.
SECTION 2.15. Sharing of Setoffs.
Each Lender agrees that if it shall, through the exercise of a right of
banker's lien, setoff or counterclaim, or pursuant to a secured claim under
Section 506 of Title 11 of the United States Bankruptcy Code or other security
20
or interest arising from, or in lieu of, such secured claim, received by such
Lender under any applicable bankruptcy, insolvency or other similar law or
otherwise, or by any other means, obtain payment (voluntary or involuntary) in
respect of any Outstanding Credits (other than any such payment from the
proceeds of the Collateral held in such Lender's Cash Collateral Account), as a
result of which the unpaid portion of its Outstanding Credits (calculated
without regard to any payment in respect of any Outstanding Credits from the
proceeds of the Collateral held in such Lender's Cash Collateral Account) shall
be proportionately less than the unpaid portion of the Outstanding Credits of
any other Lender (calculated without regard to any payment in respect of any
Outstanding Credits from the proceeds of the Collateral held in such Lender's
Cash Collateral Account), it shall be deemed simultaneously to have purchased
from such other Lender at face value, and shall promptly pay to such other
Lender the purchase price for, a participation in the Outstanding Credits of
such other Lender, so that the aggregate unpaid amount of the Outstanding
Credits and participations in the Outstanding Credits held by each Lender
(calculated, in each case, without regard to any payment in respect of any
Outstanding Credits from the proceeds of the Collateral held in such Lender's
Cash Collateral Account) shall be in the same proportion to the aggregate unpaid
amount of all Outstanding Credits then outstanding (calculated without regard to
any payment in respect of any Outstanding Credits from the proceeds of the
Collateral held in any Lender's Cash Collateral Account) as the amount of its
Outstanding Credits (calculated without regard to any payment in respect of any
Outstanding Credits from the proceeds of the Collateral held in any Lender's
Cash Collateral Account) prior to such exercise of banker's lien, setoff or
counterclaim or other event was to the amount of all Outstanding Credits
outstanding (calculated without regard to any payment in respect of any
Outstanding Credits from the proceeds of the Collateral held in any Lender's
Cash Collateral Account) prior to such exercise of banker's lien, setoff or
counterclaim or other event; provided, however, that, if any such purchase or
purchases or adjustments shall be made pursuant to this Section 2.15 and the
payment giving rise thereto shall thereafter be recovered, such purchase or
purchases or adjustments shall be rescinded to the extent of such recovery and
the purchase price or prices or adjustment restored without interest. The
Borrower expressly consents to the foregoing arrangements and agrees that any
Lender holding a participation in Outstanding Credits deemed to have been so
purchased may exercise any and all rights of banker's lien, setoff or
counterclaim with respect to any and all moneys owing by the Borrower to such
Lender by reason thereof as fully as if such Lender had made an Extension of
Credit in the amount of such participation.
SECTION 2.16. Payments.
(a) The Borrower shall make each payment (including principal of or
interest on any Extension of Credit or any Fees or other amounts) hereunder
from an account in the United States not later than 12:00 noon, New York City
time, on the date when due in dollars to the Collateral Agent at its offices at
Eleven Madison Avenue, Mail Stop OMA-02, New York, New York 10010-3629,
Attention: Christopher Kim/Agency Group (facsimile: (212) 325-8304) in
immediately available funds. Each such payment shall be made without off-set,
deduction or counterclaim, provided, that the foregoing shall not constitute a
relinquishment or waiver of the Borrower's rights to any independent claim that
the Borrower may have against either Agent, any LC Bank or any Lender.
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(b) Except as otherwise provided in this Agreement, whenever any
payment (including principal of or interest on any Extension of Credit or any
Fees or other amounts) hereunder shall become due, or otherwise would occur, on
a day that is not a Business Day, such payment may be made on the next
succeeding Business Day, and such extension of time shall in such case be
included in the computation of interest or Fees, if applicable.
SECTION 2.17. Taxes.
(a) Any and all payments of principal and interest on any of the
Outstanding Credits, or of any Fees or indemnity or expense reimbursements by
the Borrower hereunder ("Borrower Payments") shall be made, in accordance with
Section 2.16, free and clear of and without deduction for any and all current
or future United States Federal, state and local taxes, levies, imposts,
deductions, charges or withholdings, and all liabilities with respect to such
Borrower Payments, but only to the extent reasonably attributable to such
Borrower Payments, excluding (i) income taxes imposed on the net income of the
Agents, any LC Bank or any Lender (or any transferee or assignee thereof,
including a participation holder (any such entity a "Transferee")) and (ii)
franchise taxes imposed on the net income of the Agents, any LC Bank or any
Lender (or Transferee), in each case by the jurisdiction under the laws of which
the Administrative Agent, any LC Bank or such Lender (or Transferee) is
organized or doing business through offices or branches located therein, or any
political subdivision thereof (all such nonexcluded taxes, levies, imposts,
deductions, charges, withholdings and liabilities, collectively or individually,
"Taxes"). If the Borrower shall be required to deduct any Taxes from or in
respect of any sum payable hereunder to any Lender (or any Transferee), the
Agents or LC Bank, (i) the sum payable shall be increased by the amount (an
"additional amount") necessary so that after making all required deductions
(including deductions applicable to additional sums payable under this Section
2.17) such Lender (or Transferee), Agent or LC Bank (as the case may be) shall
receive an amount equal to the sum it would have received had no such deductions
been made, (ii) the Borrower shall make such deductions and (iii) the Borrower
shall pay the full amount deducted to the relevant Governmental Authority in
accordance with applicable law.
(b) In addition, the Borrower shall pay to the relevant United States
Governmental Authority in accordance with applicable law any current or future
stamp or documentary taxes or any other excise or property taxes, charges or
similar levies that arise from any payment made hereunder or from the execution,
delivery or registration of, or otherwise with respect to, this Agreement, the
Letter Agreement or any other Loan Document ("Other Taxes").
(c) The Borrower shall indemnify each Lender (or Transferee thereof),
each Agent and each LC Bank for the full amount of Taxes and Other Taxes with
respect to Borrower Payments paid by such person, and any liability (including
penalties, interest and expenses (including reasonable attorney's fees and
expenses)) arising therefrom or with respect thereto, whether or not such Taxes
or Other Taxes were correctly or legally asserted by the relevant United States
Governmental Authority. A certificate setting forth and containing an
explanation in reasonable detail of the manner in which such amount shall have
been determined and the amount of such payment or liability prepared by a Lender
or an LC Bank, or the Administrative Agent on their behalf, absent manifest
error, shall be final, conclusive and binding for all purposes. Such
indemnification shall be made within 30 days after the date an Lender (or
Transferee), Agent or LC Bank, as the case may be, makes written demand
therefor.
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(d) If any Lender (or Transferee), Agent or LC Bank shall become aware
that it is entitled to claim a refund from a United States Governmental
Authority in respect of Taxes or Other Taxes as to which it has been indemnified
by the Borrower, or with respect to which the Borrower has paid additional
amounts, pursuant to this Section 2.17, it shall promptly notify the Borrower of
theavailability of such refund claim and shall, within 30 days after receipt of
a request by the Borrower, make a claim to such United States Governmental
Authority for such refund at the Borrower's expense. If any Lender (or
Transferee), Agent or LC Bank receives a refund (including pursuant to a claim
for refund made pursuant to the preceding sentence) in respect of any Taxes or
Other Taxes as to which it has been indemnified by the Borrower or with respect
to which the Borrower had paid additional amounts pursuant to this Section 2.17,
it shall within 30 days from the date of such receipt pay over such refund to
the Borrower (but only to the extent of indemnity payments made, or additional
amounts paid, by the Borrower under this Section 2.17 with respect to the Taxes
or Other Taxes giving rise to such refund), net of all out-of-pocket expenses of
such Lender (or Transferee), Agent or LC Bank and without interest (other than
interest paid by the relevant United States Governmental Authority with respect
to such refund); provided, however, that the Borrower, upon the request of such
Lender (or Transferee), Agent or LC Bank, agrees to repay the amount paid over
to the Borrower (plus penalties, interest or other charges) to such Lender (or
Transferee), Agent or LC Bank in the event such Lender (or Transferee), Agent or
LC Bank is required to repay such refund to such United States Governmental
Authority.
(e) As soon as practicable, but in any event within 30 days, after the
date of any payment of Taxes or Other Taxes by the Borrower to the relevant
United States Governmental Authority, the Borrower will deliver to the
Administrative Agent, at its address referred to in Section 9.01, the original
or a certified copy of a receipt issued by such United States Governmental
Authority evidencing payment thereof.
(f) Without prejudice to the survival of any other agreement contained
herein, the agreements and obligations contained in this Section 2.17 shall
survive the payment in full of the principal of and interest on all Extensions
of Credit made hereunder.
(g) Each Agent, LC Bank and Lender (or Transferee) that is organized
under the laws of a jurisdiction other than the United States, any State thereof
or the District of Columbia (a "Non-U.S. Lender" or "Non U.S. Agent", as
applicable) shall deliver to the Borrower and the Administrative Agent two
copies of either United States Internal Revenue Service Form W-8BEN or Form
W-8ECI, properly completed and duly executed by such Non-U.S. Lender claiming
complete exemption from, or reduced rate of, United States Federal withholding
tax on payments by the Borrower under this Agreement. Such forms shall be
delivered by each Non-U.S. Lender on or before the date it becomes a party to
this Agreement (or, in the case of a Transferee that is a participation holder,
on or before the date such participation holder becomes a Transferee hereunder)
and on or before the date, if any, such Non-U.S. Lender changes its applicable
lending office by designating a different lending office (a "New Lending
Office"). In addition, each Non-U.S. Lender shall deliver such forms promptly
upon the obsolescence or invalidity of any form previously delivered by such
Non-U.S. Lender. Notwithstanding any other provision of this Section 2.17(g), a
Non-U.S. Lender shall not be required to deliver any form pursuant to this
Section 2.17(g) that such Non-U.S. Lender is not legally able to deliver.
23
(h) The Borrower shall not be required to indemnify any Non-U.S. Lender
or Non-U.S. Agent (including any Transferee), or to pay any additional amounts
to any Non-U.S. Lender or Non-U.S. Agent (including any Transferee), in respect
of United States Federal, state or local withholding tax pursuant to subsection
(a) or (c) above to the extent that (i) the obligation to withhold amounts with
respect to United States Federal, state or local withholding tax existed on the
date such Non-U.S. Lender became a party to this Agreement (or, in the case of a
Transferee that is a participation holder, on the date such participation holder
became a Transferee hereunder) or, with respect to payments to a New Lending
Office, the date such Non-U.S. Lender designated such New Lending Office with
respect to an Extension of Credit; provided, however, that this clause (i) shall
not apply to any Transferee or New Lending Office that becomes a Transferee or
New Lending Office as a result of an assignment, participation, transfer or
designation made at the request of the Borrower; and provided further, however,
that this clause (i) shall not apply to the extent the indemnity payment or
additional amounts any Transferee, LC Bank or Lender (or Transferee) through a
New Lending Office, would be entitled to receive (without regard to this clause
(i)) do not exceed the indemnity payment or additional amounts that the person
making the assignment, participation or transfer to such Transferee, LC Bank or
Lender (or Transferee) making the designation of such New Lending Office, would
have been entitled to receive in the absence of such assignment, participation,
transfer or designation or (ii) the obligation to pay such additional amounts or
such indemnity payments would not have arisen but for a failure by such Non-U.S.
Lender (including any Transferee) to comply with the provisions of subsections
(g) above and (i) below.
(i) Any LC Bank or Lender (or Transferee) claiming any indemnity
payment or additional amounts payable pursuant to this Section 2.17 shall use
reasonable efforts (consistent with legal and regulatory restrictions) to file
any certificate or document reasonably requested in writing by the Borrower or
to change the jurisdiction of its applicable lending office if the making of
such a filing or change would avoid the need for or reduce the amount of any
such indemnity payment or additional amounts that may thereafter accrue and
would not, in the good faith determination of such LC Bank or Lender
(or Transferee) (as the case may be), be otherwise disadvantageous to such LC
Bank or Lender (or Transferee) (as the case may be).
(j) Nothing contained in this Section 2.17 shall require any Lender (or
Transferee), Agent or LC Bank to make available to the Borrower any of its tax
returns (or any other information) that it deems to be confidential or
proprietary.
SECTION 2.18. Assignment of Commitments Under Certain Circumstances.
In the event that any Lender or LC Bank shall have delivered a notice
or certificate pursuant to Section 2.12 or 2.13, or the Borrower shall be
required to make additional payments to any Lender or LC Bank under Section
2.17, the Borrower shall have the right, at its own expense, upon notice to such
Lender or LC Bank (as the case may be) and the Administrative Agent, to require
such Lender or LC Bank (as the case may be) to transfer and assign without
recourse (in accordance with and subject to the restrictions contained in
Section 9.04) all such Lender's or LC Bank's (as the case may be) interests,
rights and obligations contained hereunder to another financial institution
approved by the Administrative Agent and the Borrower (which approval shall not
be unreasonably withheld) which shall assume such obligations; provided that (i)
no such assignment shall conflict with any law, rule or regulation or order of
any Governmental Authority and (ii) the assignee shall pay to the affected
Lender or LC Bank (as the case may be) in immediately available funds on the
date of such assignment the principal of and interest accrued to the date of
payment on the Extensions of Credit made by it hereunder and all other amounts
accrued for its account or owed to it hereunder.
24
Article III
REPRESENTATIONS AND WARRANTIES
The Borrower represents and warrants to each Agent, Lender and LC Bank
as follows:
SECTION 3.01. Organization; Powers.
The Borrower (i) is a statutory trust duly created, validly existing
and in good standing under the laws of the State of Delaware, (ii) has all
requisite trust power and authority to own its property and assets and to carry
on its business as now conducted and as proposed to be conducted, (iii) is
qualified to do business in every jurisdiction where such qualification is
required, except where the failure so to qualify would not result in a Material
Adverse Change, and (iv) has all requisite trust power and authority to execute
and deliver the Loan Documents, to perform its obligations under the Loan
Documents and to request and receive Extensions of Credit hereunder.
SECTION 3.02. Authorization.
The execution, delivery and performance by the Borrower of the Loan
Documents and the Extensions of Credit hereunder (i) have been duly authorized
by all requisite trust action and (ii) will not (A) violate (x) any provision of
any law, statute, rule or regulation (including, without limitation, the Margin
Regulations) or of the Governing Instruments, (y) any order of any Governmental
Authority or (z) any provision of any indenture, agreement or other instrument
to which the Borrower is a party or by which it or any of its property is or may
be bound, (B) be in conflict with, result in a breach of or constitute (alone or
with notice or lapse of time or both) a default under any such indenture,
agreement or other instrument or (C) result in the creation or imposition of any
Lien upon any property or assets of the Borrower, other than pursuant to the
Security Documents.
SECTION 3.03. Enforceability.
Each Loan Document constitutes a legal, valid and binding obligation of
the Borrower enforceable in accordance with its terms except to the extent that
enforcement may be limited by bankruptcy, insolvency or similar laws affecting
the enforcement of creditors' rights generally.
SECTION 3.04. Security Interests.
Each Security Document creates a valid and first priority Lien in the
Collateral described therein that exists, and on or prior to the Closing Date,
all filings and other actions necessary to perfect and protect such Liens will
have been taken.
SECTION 3.05. Governmental Approvals.
Other than as required by Section 3.04, no action, consent or approval
of, registration or filing with or other action by any Governmental Authority is
or will be required in connection with the execution, delivery and performance
by the Borrower of any Loan Document as of the date hereof and, after the date
hereof, such actions, consents, approvals, registrations, filings and other
actions that will be (A) duly obtained, (B) maintained in full force and effect
and (C) sufficient for their respective purposes.
25
SECTION 3.06. Financial Statements.
(a) When delivered pursuant to Section 5.04(a), the balance sheet of
the Borrower and its Consolidated Subsidiaries as of the end of each fiscal year
of the Borrower and the related statements of income, retained earnings and cash
flows for the fiscal year then ended, reported on by Deloitte & Touche LLP or
another nationally recognized accounting firm will fairly present, in conformity
with GAAP, the financial position of the Borrower as of such dates and the
results of operations and cash flows for the periods ending on such dates. When
delivered pursuant to Section 5.04(b), the unaudited balance sheet of the
Borrower as of the end of each fiscal quarter (other than any fiscal quarter
that ends at the end of a fiscal year) and the related consolidated statements
of income and cash flows for the three-, six- or nine- (as applicable) month
period ending on such date, certified by a Financial Officer of the Borrower,
will fairly present (subject to year-end adjustments), in conformity with GAAP,
the financial position of the Borrower as of such dates and its results of
operations and cash flows for the periods ending on such dates.
(b) Since the date of this Agreement, there has been no Material
Adverse Change.
SECTION 3.07. Litigation.
There is no action, suit or proceeding pending against, or to the
knowledge of the Borrower, threatened against or affecting, the Borrower before
any court or arbitrator or any governmental body, agency or official in which
there is a reasonable possibility of an adverse decision that could materially
adversely affect the ability of the Borrower to pay its obligations hereunder or
that in any manner draws into question the validity of any Loan Document.
SECTION 3.08. Federal Reserve Regulations.
(a) The Borrower is not engaged principally, or as one of its important
activities, in the business of extending credit for the purpose of purchasing or
carrying Margin Stock.
(b) No part of the proceeds of any Extension of Credit will be used by
the Borrower, whether directly or indirectly, and whether immediately,
incidentally or ultimately, to purchase or carry Margin Stock or to refund
indebtedness originally incurred for such purpose, or for any other purpose that
entails a violation of, or that is inconsistent with, the provisions of the
Margin Regulations.
(c) Not more than 25% of the value of the assets of the Borrower subject
to the restrictions of Sections 5.09 and 5.10 are represented by Margin Stock.
26
SECTION 3.09. Investment Company Act; Public Utility Holding Company
Act.
(a) The Borrower is not an "investment company" as defined in, or
subject to regulation under, the Investment Company Act of 1940.
(b) The Borrower is exempt from all provisions of the Public Utility
Holding Company Act of 1935 and rules and regulations thereunder, except for
Sections 9(a)(2) and 33 of such Act and the rules and regulations thereunder,
and the execution and delivery by the Borrower of the Loan Documents and its
performance of the obligations thereunder do not violate any provision of such
Act or any rule or regulation thereunder.
SECTION 3.10. No Material Misstatements.
No report, financial statement or other written information furnished
by or on behalf of the Borrower to the Agents or any Lender pursuant to or in
connection with the Loan Documents contains or will contain any material
misstatement of fact or omits or will omit to state any material fact necessary
to make the statements therein, in the light of the circumstances under which
they were or will be made, not misleading.
SECTION 3.11. Taxes.
The Borrower has filed or caused to be filed within 3 days of the date
on which due, all material Federal, state and local tax returns that to its
knowledge are required to be filed by it, and has paid or caused to be paid all
material taxes shown to be due and payable on such returns or on any assessments
received by them, other than any taxes or assessments the validity of which is
being contested in good faith by appropriate proceedings and with respect to
which appropriate accounting reserves have to the extent required by GAAP been
set aside.
SECTION 3.12. Borrower Activities.
The Borrower has no assets or liabilities, and at no time prior to the
date hereof has had, any assets or liabilities other than its rights in the
Collateral, its rights and obligations under the Loan Documents, the Trust
Agreement, the Administration Agreement, the Letter Agreement, the Trustee Fee
Letter and the Parent Facility and ordinary expenses relating to the
administration of its rights and obligations under the Loan Documents, the Trust
Agreement, the Administration Agreement, the Letter Agreement, the Trustee Fee
Letter and the Parent Facility; the Borrower does not engage in, and no time
prior to the date hereof has engaged in, any activity or business other than
those activities and the businesses directly related to the performance of its
obligations and the exercise of its rights under the Loan Documents and the
Parent Facility.
SECTION 3.13. Solvency
As of the date hereof, and after giving effect to the transactions
contemplated by the Loan Documents and the Parent Facility, the Borrower is
Solvent.
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Article IV
CONDITIONS
SECTION 4.01. Conditions for the Commitments.
The Commitment of each Lender is subject to the satisfaction of the
following conditions:
(a) The Administrative Agent shall have received the following
documents, each dated (except as specified below) the date hereof (the "Closing
Date"), in form and substance reasonably satisfactory to the Administrative
Agent and in sufficient copies for each Lender:
(i) A counterpart to this Agreement executed by each Lender, the
Collateral Agent, each LC Bank and the Borrower.
(ii) Counterparts of the Security Agreement executed by the
Borrower and CSFB, as Collateral Agent.
(iii) Counterparts of each Pledge Agreement executed by the
Borrower and CSFB, as Collateral Agent and as securities intermediary.
(iv) Counterparts of the Control Agreement executed by the
Borrower, The Bank of New York and the Collateral Agent.
(v) An executed copy of a letter regarding payment instructions
from the Borrower to TXU pursuant to the Parent Facility.
(vi) Lien search results (dated as of a recent date) with respect
to the Borrower from all appropriate jurisdictions and filing offices
satisfactory to the Agents and evidence of the creation, perfection and
first priority status of the Liens granted pursuant to the Security
Documents.
(vii) A copy of the certificate of trust of the Borrower,
certified as of a recent date by the Secretary of State of the State of
Delaware, and a certificate as to the good standing of the Borrower as
of a recent date from such Secretary of State and from the Secretary of
State of the State of New York.
(viii) A certificate of a Responsible Officer certifying (A) that
attached thereto are true and complete copies of the Governing
Instruments as in effect on the Closing Date, (B) that the Trust
Agreement authorizes the execution and delivery by the Borrower of the
Loan Documents, the Extensions of Credit to be made hereunder and the
performance by the Borrower of all of its obligations under the Loan
Documents and (C)that the Governing Instruments referred to in clause
(A) above have not been amended since the date of the last such
amendment attached to such certificate.
(ix) A certificate of a Responsible Officer stating that (A) no
action, consent or approval of, registration or filing with or other
action by any Governmental Authority is or will be required in
connection with the execution, delivery and performance by the Borrower
of the Loan Documents, (B) the representations and warranties set forth
in Article III hereof are true and correct in all material respect as
of the Closing Date and (C) no Event of Default or Default has occurred
and is continuing on the Closing Date.
(x) A certificate of a duly authorized officer of the Trustee as to
(A) the incumbency and specimen signature of each officer of the
Trustee executing each Loan Document and any other document to be
delivered in connection therewith by the Trustee on its own behalf or
on behalf of the Borrower, as applicable, (B) the organizational
status, existence and good standing of the Trustee, and (C) the
accuracy and completeness of copies of resolutions attached to such
certificate authorizing the execution and delivery by the Trustee of
the Loan Documents on behalf of the Borrower and all other documents
to be delivered in connection therewith by the Trustee on its own
behalf or on behalf of the Borrower.
(xi) Favorable written legal opinions of (i) (A) Thelen Reid &
Priest LLP, special New York counsel to the Borrower, (B) Hunton &
Williams LLP, counsel to the Borrower, and (C) Richards Layton &
Finger, P.A., special Delaware counsel to the Borrower and the Trustee,
and (ii) King & Spalding LLP, special New York counsel to the Agents,
in each case dated the Closing Date, addressed to the Agents, the LC
Banks and the Lenders and in form and substance satisfactory to the
Administrative Agent.
(b) The Agents shall have received such other approvals, opinions,
certificates, instruments and documents as the Agents, any LC Bank or any Lender
may have reasonably requested, in form satisfactory to the Agents and the
requesting LC Bank or Lender (if applicable).
SECTION 4.02. Conditions for Initial Extension of Credit.
The obligation of each Lender and LC Bank to make the initial Extension
of Credit to or for the account of the Borrower hereunder are subject to the
satisfaction of the following conditions on or prior to the date of such
Extension of Credit (such date being the "Funding Date"):
(a) The Closing Date shall have occurred.
(b) The Administrative Agent shall have received evidence satisfactory
to it that (i) the Borrower has been capitalized by TXU with funds in an amount
at least equal to 105% of the Total Commitment on the Funding Date, (ii) the
Cash Collateral Value of each Cash Collateral Account shall be at least equal to
such Cash Collateral Account's Cash Collateral Requirement, and (iii) all fees
of the Trustee that are expected to become due and payable by the Borrower
through the Maturity Date as compensation for the Trustee's services to the
Borrower have been paid in full.
(c) The Agents shall have received all fees required to be paid on or
prior to the Closing Date, and reimbursement for all costs and expenses of the
Agents payable under Section 9.05 for which invoices have been presented on or
prior to the Funding Date.
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SECTION 4.03. Conditions for All Extensions of Credit.
The obligation of each Lender to make each Loan and of each LC Bank to
make each Extension of Credit relating to a Letter of Credit shall be subject to
the satisfaction of the following conditions precedent on the date of such
Extension of Credit:
(a) The Administrative Agent shall have received from the Borrower a
notice requesting such Extension of Credit as required by Section 2.03 or 2.04,
as applicable.
(b) The representations and warranties of the Borrower set forth in
Article III hereof (except in the case of any Extension of Credit that does not
increase the aggregate principal amount of the Outstanding Credits of any
Lender, the representations set forth in Sections 3.06(b) and 3.07) shall be
true and correct in all material respects on and as of the date of such
Extension of Credit with the same effect as though made on and as of such date,
except to the extent such representations and warranties expressly relate to an
earlier date.
(c) At the time of and immediately after such Extension of Credit, no
Default or Event of Default shall have occurred and be continuing or would
result from the making of such Extension of Credit.
(d) The Administrative Agent shall have received a certificate of a
Responsible Officer certifying that the matters set forth in subsections (b)
and (c) of this Section 4.02 are true and correct as of such date.
Each such Extension of Credit shall be deemed to constitute a representation and
warranty by the Borrower on the date of such Extension of Credit as to the
matters specified in subsections (b) and (c) of this Section 4.03.
Article V
COVENANTS
The Borrower agrees that, so long as any Lender has any Commitment
hereunder or any amount payable hereunder remains unpaid:
SECTION 5.01. Existence, Preservation of Rights and Modifications of
Governing Instruments.
It (i) will do or cause to be done all things necessary to preserve and
keep in full force and effect its existence and all rights, licenses, permits,
franchises and authorizations necessary or desirable in the normal conduct of
its business, (ii) will not modify, amend or revoke any Governing Instrument,
other than modifications or amendments that relate solely to the ministerial
provisions of the applicable Governing Instrument and that do not affect the
rights of the Secured Parties.
SECTION 5.02. Performance Under Parent Facility.
It will duly perform all its obligations and diligently and promptly
enforce all its rights under the Parent Facility and will not modify or waive
any provision of the documents evidencing the Parent Facility without the prior
written consent of the Lenders, which consent will not be unreasonably withheld
or conditioned upon the payment of any fee to the Lenders; provided, however,
that if (i) the "Commitment" under the Parent Facility shall have been
terminated and all loans, interest and other amounts then due and payable by TXU
under the Parent Facility shall have been paid in full, (ii) no Default or Event
of Default (including with respect to the Borrower's obligations under Section
5.12) shall have occurred and be continuing, and (iii) the Total Commitment
shall have been terminated, the Borrower may release TXU from all of its
obligations under the Parent Facility including those that, by their terms,
would survive the termination of such "Commitment" and the payment of such
amounts.
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SECTION 5.03. Compliance with Law.
It will comply with all applicable material laws, rules, regulations
and orders of any Governmental Authority, whether now in effect or hereafter
enacted, except where the validity or applicability of such laws, rules,
regulations or orders is being contested by appropriate proceedings in good
faith.
SECTION 5.04. Financial Statements, Reports, Etc.
The Borrower will furnish to the Agents and each Lender:
(a) as soon as available and in any event within 120 days after the
end of each fiscal year of the Borrower, an audited balance sheet of the
Borrower as of the end of such fiscal year and the related statements of income,
retained earnings and cash flows for such fiscal year, (i) setting forth in
each case in comparative form the figures for the previous fiscal year, all
reported on by Deloitte & Touche LLP or other independent public accountants of
nationally recognized standing and (ii) showing the assets, liabilities and
income of the Borrower as separate and distinct from that of TXU and any other
Subsidiary of TXU;
(b) as soon as available and in any event within 60 days after the end
of each of the first three quarters of each fiscal year of the Borrower a
balance sheet of the as of the end of such quarter and the related statements
of income for such quarter, for the portion of the Borrower's fiscal year ended
at the end of such quarter, and for the twelve months ended at the end of such
quarter, and the related statement of cash flows for the portion of the
Borrower's fiscal year ended at the end of such quarter, (i) setting forth
comparative figures for previous dates and periods, all certified (subject to
normal year-end adjustments) as to fairness of presentation, GAAP and
consistency by a Financial Officer of the Borrower and (ii) showing the assets,
liabilities and income of the Borrower as separate and distinct from that of TXU
and any other Subsidiary of TXU;
(c) simultaneously with any delivery of each set of financial
statements referred to in subsections (a) and (b) above, a certificate of a
Financial Officer of the Borrower substantially in the form of Exhibit H (with
such changes to such form as the Collateral Agent may, in its reasonable
discretion, deem appropriate) (i) setting forth in reasonable detail the
calculations required to establish whether the Borrower was in compliance with
the requirements of Section 5.12 on the date of such financial statements, (ii)
stating whether any Default or Event of Default exists on the date of such
certificate and, if any Default or Event of Default then exists, setting forth
the details thereof and the action that the Borrower is taking or proposes to
take with respect thereto and (iii) certifying that such financial statements
were prepared in accordance with GAAP, consistently applied;
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(d) forthwith upon becoming aware of the occurrence of any Default or
Event of Default, a certificate of a Responsible Officer setting forth the
details thereof and the action that the Borrower is taking or proposes to take
with respect thereto; and
(e) promptly, from time to time, such additional information regarding
the financial position or business of the Borrower as any Agent, at the request
of any Lender or LC Bank, may reasonably request.
SECTION 5.05. Taxes, Etc.
It will (i) elect to be disregarded for Federal income tax purposes and
(ii) pay and discharge promptly when due all material taxes, assessments and
governmental charges imposed upon it or upon its income or profits or in respect
of its property, as well as all other material liabilities, in each case before
the same shall become delinquent or in default and before penalties accrue
thereon, unless and to the extent that the same are being contested in good
faith by appropriate proceedings and adequate reserves with respect thereto
shall, to the extent required by GAAP, have been set aside.
SECTION 5.06. Maintenance and Preparation of Records; Access to
Properties and Inspections.
It will (i) maintain financial records in accordance with GAAP (and in
it properly account for all contributions of capital from TXU), separate and
distinct from the financial records of TXU and any other Subsidiary of TXU and
otherwise in a manner that will not render it difficult or costly to segregate,
ascertain and otherwise identify the assets of the Borrower, (ii) pay the cost
of the maintenance of its financial records and the preparation of its financial
reports from its own assets; and (iii) upon reasonable notice and at reasonable
times, permit authorized representatives designated by any Agent, Lender or LC
Bank to visit and inspect its properties, books and records and to discuss its
affairs, finances and condition with the Trustee or its officers.
SECTION 5.07. Consolidated Financial Statements.
If the financial statements of the Borrower are consolidated with the
financial statements of any other person, the Borrower will ensure that such
financial statements will contain a narrative description of the assets,
liabilities, business functions, operations and existence of the Borrower to
ensure that such separate assets, liabilities, business functions, operations
and existence are readily distinguishable by any person receiving or relying on
such consolidated financial statements (including, without limitation, any
creditor of TXU or any other Subsidiary of TXU).
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SECTION 5.08. Use of Proceeds.
It will not use the proceeds of the Extensions of Credit for purposes
other than to satisfy the obligations of the Borrower under the Parent Facility
to make loans to TXU and arrange for the issuance of letters of credit.
SECTION 5.09. Consolidations, Mergers, Sales and Acquisitions of
Assets, Creation of Subsidiaries and Assignments Under the Parent Facility.
It will not (i) consolidate or merge with or into any person, (ii) make
any disposition of its assets, other than in compliance with the Security
Documents, as permitted under Section 5.13 or in order to pay operating expenses
pursuant to Article VI, (iii) create, acquire or suffer to exist any Subsidiary
of the Borrower or acquire any assets of or make any investments in any other
person, other than in the form of Permitted Investments or pursuant to the
Parent Facility, or (iv) assign, transfer or grant any participation in its
rights and obligations under the Parent Facility, other than pursuant to the
Security Agreement.
SECTION 5.10. Limitations on Liens.
It will not create or assume or permit to exist any Lien in respect of
any property or assets of any kind (real or personal, tangible or intangible) of
the Borrower, other than (i) such Liens granted pursuant to the Security
Documents and (ii) such Liens being contested in any commercially reasonable
manner by the Borrower on or with respect to such property or assets where the
claim underlying such Lien is not in excess of $2,000,000; provided that no such
contest shall continue beyond the date that is 30 days from the date of the
incurrence or creation of such Lien.
SECTION 5.11. Limitation on Activities.
It will at all times maintain itself as a special purpose entity and
will not engage in any activity other than (i) investing in Permitted
Investments, (ii) entering into, and exercising its rights and performing its
obligations under, the Loan Documents, the Letter Agreement, the Trustee Fee
Letter, the Parent Facility and the Governing Instruments, and (iii) making
distributions to TXU in accordance with Section 5.13.
SECTION 5.12. Cash Collateral Requirement.
At all times on and after the Funding Date, it will maintain Collateral
in each Cash Collateral Account having a Cash Collateral Value at least equal to
the Cash Collateral Requirement of such Cash Collateral Account; provided;
however, that for a period of two Business Days following any drawing under a
Letter of Credit issued by any Lender, the Cash Collateral Value of such
Lender's Cash Collateral Account may exceed such Lender's Cash Collateral
Requirement by an amount equal to the amount of such drawing.
SECTION 5.13. Restricted Payments.
It will not directly or indirectly declare or make any Restricted
Payment; provided, however, that (i) the Borrower may make Restricted Payments
33
no more than once in each fiscal quarter of the Borrower during the ten-day
period following the delivery of the financial statements and certificates
described in Sections 5.04(a), (b) and (c) if no Default or Event of Default has
occurred and is continuing or would result from the making of such Restricted
Payment (including, without limitation, any Default or Event of Default
resulting from the Borrower's failure to comply with Section 5.12 or to
reimburse any LC Bank for any drawing under any Letter of Credit on the date of
such drawing), (ii) if no Default or Event of Default has occurred and is
continuing or would result from the making of such Restricted Payment, the
Borrower may make a Restricted Payment on the date of each reduction in the
Commitment of any Lender pursuant to Section 2.10 in an amount no greater than
105% of the amount of such Commitment reduction and (iii) the Borrower may make
Restricted Payments from the funds described in clause FIFTH of Section 6.04(a);
provided, in the case of each of clauses (i), (ii) and (iii) above, a
Responsible Officer shall have delivered a certificate to the Collateral Agent
stating that the applicable requirements described above have been satisfied and
directing the Collateral Agent as to the amount of such Restricted Payment to be
made from each Cash Collateral Account pursuant to the applicable provisions of
Article VI.
SECTION 5.14. Maintenance of Accounts.
It will at all times maintain the Cash Collateral Accounts and the
Revenue Account with the Collateral Agent and will not maintain any other bank,
deposit, investment or brokerage account.
SECTION 5.15. Bankruptcy.
It will not institute any proceeding seeking to adjudicate it bankrupt
or insolvent, or seeking liquidation, winding up, reorganization, arrangement,
adjustment, protection, relief or composition of it or its debts under any law
relating to bankruptcy, insolvency or reorganization or relief of debtors, or
seek the entry of an order for relief or the appointment of a receiver, trustee,
custodian or other similar official for it or for any of its assets, or make a
general assignment for the benefit of creditors, unless the Trustee has
determined that the Borrower is not Solvent, based upon written advice from
nationally-recognized bankruptcy counsel.
SECTION 5.16. Commingling.
It will not commingle any of its assets, funds, liabilities or business
functions with the assets, funds, liabilities or business functions of TXU or
any other Subsidiary of TXU, and it will pay its own liabilities, losses and
expenses only from its own funds.
SECTION 5.17. No Guaranties or Other Debt.
Other than as contemplated by the arrangement of letters of credit
under the Parent Facility, it will not (i) guaranty or become obligated for the
debts or obligations of any other person or (ii) acquire or assume the
obligations of TXU or any other Subsidiary of TXU or otherwise incur any
Indebtedness.
34
SECTION 5.18. Special Purpose Entity.
It will hold itself out as a special purpose entity, separate and
distinct from each other person, including, without limitation, TXU and its
other Subsidiaries, and, as soon as reasonably practicable, will correct any
known misunderstanding regarding its separate identity; without limiting the
foregoing, it will use separate stationery and other printed materials bearing
its own name and will not identify itself as a division or department of TXU or
any other Subsidiary of TXU.
SECTION 5.19. Compensation of Third Parties.
It will compensate all consultants, independent contractors,
accountants, trustees, lawyers and agents from its own funds for services
provided to it by such persons.
SECTION 5.20. Allocation of Rent and Overhead.
If the Borrower and TXU or any other Subsidiary of TXU occupy any
premises in the same location, the Borrower will allocate fairly, reasonably,
appropriately and nonarbitrarily among such persons any rent and overhead
expenses, such that each such person bears its reasonable and fair share of such
rent and expenses.
SECTION 5.21. Allocation of Costs of Officers and Employees.
If the Borrower and TXU or any other Subsidiary of TXU share the same
officers or other employees, the Borrower will allocate fairly, reasonably,
appropriately and nonarbitrarily among such persons any salary and benefit costs
associated therewith, such that each such person bears its reasonable and fair
share of such costs.
SECTION 5.22. Allocation of Costs of Joint Contracting.
If the Borrower and TXU or any other Subsidiary of TXU jointly contract
or do business with vendors or service providers, the Borrower will allocate
fairly, reasonably, appropriately and nonarbitrarily among such persons any
costs and expenses of doing so, such that each such person bears its reasonable
and fair share of such costs and expenses.
SECTION 5.23. Allocation of Costs of Vendors and Service Providers.
If the Borrower contracts or does business with vendors or service
providers where the goods or services are wholly or partially for the benefit of
TXU or another Subsidiary of TXU, the Borrower will allocate fairly, reasonably,
appropriately and nonarbitrarily among such persons any costs and expenses in
doing so to the person for whose benefit such goods and services are provided,
such that each such person bears its reasonable and fair share of such costs and
expenses.
SECTION 5.24. Arm's-Length Transactions.
It will enter into transactions with TXU and any other Subsidiary of
TXU only (i) on a commercially reasonable and arm's-length basis, and (ii) if
such transaction is documented in writing; provided, however, that the parties
to this Agreement acknowledge that the transactions contemplated by the Parent
Facility (including, without limitation, the Trust Agreement and the
Administration Agreement) satisfy the foregoing requirements as of the date
hereof.
35
Article VI
THE ACCOUNTS
SECTION 6.01. Establishment and Management of Accounts.
(a) On or prior to the Closing Date, the Borrower will establish (i)
at The Bank of New York's office at 101 Barclay Street, 12E Floor, New York,
NY 10286, account #217049 entitled "LOC Trust 2003 - Revenue Account"
(the "Revenue Account") and (ii) at the Collateral Agent's office at
Eleven Madison Avenue, Mail Stop OMA-2, New York, NY 10010-3629,
separate collateral accounts for each Lender (each a "Cash Collateral
Account", and together with the Revenue Account, the "Accounts"). The
Revenue Account shall be pledged to the Collateral Agent for the
benefit of the Secured Parties pursuant to the Security Agreement. Each
Cash Collateral Account shall be pledged to the Collateral Agent for
the benefit of the Agents and the Lender designated in the name of such
Cash Collateral Account pursuant to the Pledge Agreement in which such
Lender is named as a secured party.
(b) Each Account shall remain in the exclusive possession of, and
under the sole dominion and control of, the Collateral Agent; provided that so
long as there shall not have occurred any Event of Default, the Borrower (i)
shall be entitled to direct the investment and reinvestment of funds and the
liquidation of investments held from time to time in the Cash Collateral
Accounts in accordance with Section 6.03(a) and (ii) may make Restricted
Payments from the funds held in the Cash Collateral Accounts in accordance with
Sections 5.13 and 6.03(b) and clause FIFTH of Section 6.04(a). Any cash held by
the Collateral Agent for which the Collateral Agent has not received written
instructions from the Borrower regarding investment thereof shall be held by
the Collateral Agent in the appropriate Deposit Accounts (as such term is
defined, with respect to each Lender, on Schedule 2).
(c) Each month during the term of this Agreement the Collateral Agent
shall prepare and deliver to the Borrower and each Lender and LC Bank a
statement of the balances in, and each transaction with respect to,
each Account.
(d) The Collateral Agent shall in no event be liable in connection
with the investment or reinvestment of any moneys held by it hereunder in
accordance with this Agreement and the other Loan Documents, including for any
delays in the investment or reinvestment of such moneys, or any loss of
interest incidental to any such delays, except to the extent caused by the
gross negligence or willful misconduct of the Collateral Agent.
(e) The Borrower shall deliver to the Collateral Agent such U.S.
Internal Revenue Service forms as are necessary and required for the Collateral
Agent to report the income earned on the investment and reinvestment of the
monies in the Accounts, which obligation shall survive the termination of this
Agreement.
(f) Permitted Investments shall be valued as follows:
36
(i) for the purpose of determining the Cash Collateral Value of any
Cash Collateral Account, all Permitted Investments credited to such Account
shall be valued at fair market value. The fair market value of Permitted
Investments shall be based on accepted industry standards and from accepted
industry providers. Accepted industry providers shall include but are not
limited to pricing services provided by Financial Times Interactive Data
Corporation, Merrill Lynch, Citigroup, Bear Stearns or Lehman Brothers;
(ii) as to certificates of deposit, the value thereof shall be
determined by the face amount thereof, plus accrued interest thereon; and
(iii) as to any investment not specified above, the value thereof
established by prior agreement among the Borrower, the Collateral Agent and the
Lender for the benefit of which such Permitted Investment is pledged.
SECTION 6.02. The Revenue Account.
(a) Except as specifically provided otherwise in Section 6.04, the
Collateral Agent shall promptly upon receipt thereof deposit in the Revenue
Account all monies received by the Collateral Agent pursuant to Section 2.16
hereof and Section 4.5 of the Security Agreement. All funds deposited in the
Revenue Account before 12:00 noon (New York City time) on any Business Day shall
be distributed on such Business Day as provided in subsection (b) or (c) below,
as applicable; all funds deposited in the Revenue Account after 12:00 noon (New
York City time) on any Business Day, to the extent practicable, shall be
distributed on such Business Day pursuant to subsection (b) or (c) below, and if
not practicable, shall be held by the Collateral Agent in the Revenue Account
and distributed pursuant to subsection (b) or (c) below on the following
Business Day. The Borrower hereby irrevocably authorizes and empowers the
Collateral Agent, as the attorney-in-fact for the Borrower, to endorse any check
or any other instrument or security to be deposited or held in the Revenue
Account requiring the endorsement of the Borrower, which power is coupled with
an interest and is irrevocable until the Maturity Date and the payment in full
of all Outstanding Credits and other amounts payable by the Borrower under the
Loan Documents.
(b) If no Acceleration shall have occurred, on each Business Day the
Collateral Agent shall distribute funds held in the Revenue Account as of 12:00
noon (New York City time) on such Business Day in the following priority and
amounts, unless otherwise directed by the Borrower and the Lenders (with the
consent of the Trustee if such directions would affect the priority of any
payment to the Trustee or any of its officers, directors, employees,
shareholders or agents):
FIRST, to the payment of the fees and expenses of the Trustee and any
indemnity payable by the Borrower to the Trustee or its officers,
directors, employees, shareholders or agents; SECOND, to the payment of
other operating expenses of the Borrower certified by the Borrower to the
Collateral Agent to be then due and payable, in accordance with
instructions of the Borrower included in such certificate; THIRD, to the
payment of fees and expenses then due and payable to the Collateral Agent
under the Loan Documents; FOURTH, to the payment of fees and expenses then
due and payable to the Administrative Agent under the Loan Documents;
FIFTH, to the payment of Commitment Fees then due and payable to the
Lenders pro rata in accordance with each Lender's percentage of all such
obligations then due and payable; SIXTH, to the payment of LC Fees then due
and payable to the LC Banks pro rata in accordance with each LC Bank's
percentage of all such obligations then due and payable; SEVENTH, to the
payment of any interest then due and payable on the Loans pro rata in
accordance with each Lender's percentage of all such obligations then due
and payable; EIGHTH, to the payment of any reimbursement obligations in
respect of Letters of Credit then due and payable pro rata in accordance
with each LC Bank's percentage of all such obligations then due and
payable; NINTH, to the payment of principal of the Loans then due and
payable pro rata in accordance with each Lender's percentage of all such
obligations then due and payable; TENTH, to the payment of all other
obligations of the Borrower under the Loan Documents not otherwise
described in this Section 6.02(b) then due and payable; and ELEVENTH, to
the Lenders' Cash Collateral Accounts pro rata in accordance with the
Lenders' respective Commitments (irrespective of usage).
37
(c) If Acceleration shall have occurred, all Shared Collateral held by the
Collateral Agent in the Revenue Account (including deposits and investments
thereof in the Revenue Account) and all cash proceeds received by the Collateral
Agent in respect of any sale of, collection from, or other realization upon all
or any part of the Shared Collateral shall be applied to the payment of the fees
and expenses of the Trustee and any indemnity payable by the Borrower to the
Trustee or its officers, directors, employees, shareholders or agents, and the
balance may, in the discretion of the Collateral Agent, or shall, at the
instruction of the Lenders, be held by the Collateral Agent as Collateral for
the Secured Parties, and then or at any time thereafter be distributed in whole
or in part by the Collateral Agent in the following order of priority unless
otherwise directed by the Lenders (with the consent of the Collateral Agent if
such directions would affect the priority of any payment to any Agent and the
consent of the Trustee if such directions would affect the priority of any
payment to the Trustee or any of its officers, directors, employees,
shareholders or agents):
FIRST, to the payment of other operating expenses of the Borrower certified
by the Borrower to the Collateral Agent to be then due and payable, in
accordance with instructions of the Borrower included in such certificate;
SECOND, to the costs and expenses (including attorneys' fees and expenses),
if any, incurred by the Administrative Agent and the Collateral Agent in
connection with the collection of such amounts under the Loan Documents,
including, without limitation, any costs incurred in connection with the
sale or disposition of any Shared Collateral; THIRD, to the payment of
other fees and expenses then due and payable to the Collateral Agent under
the Loan Documents; FOURTH, to the payment of other fees and expenses then
due and payable to the Administrative Agent under the Loan Documents;
FIFTH, to the payment of Commitment Fees then due and payable to the
Lenders pro rata in accordance with each Lender's percentage of all such
obligations then due and payable; SIXTH, to the payment of LC Fees then due
and payable to the LC Banks pro rata in accordance with each LC Bank's
percentage of all such obligations then due and payable; SEVENTH, to the
payment of any interest then due and payable on the Loans pro rata in
accordance with each Lender's percentage of all such obligations then due
and payable; EIGHTH, to the payment of any reimbursement obligations in
respect of Letters of Credit then due and payable pro rata in accordance
with each LC Bank's percentage of all such obligations then due and
payable; NINTH, to the payment of principal of the Loans then due and
payable pro rata in accordance with each Lender's percentage of all such
obligations then due and payable; TENTH, to the payment of all other
obligations of the Borrower under the Loan Documents not otherwise
described in this Section 6.02(c) then due and payable; ELEVENTH, to the
Lenders' Cash Collateral Accounts pro rata in accordance with the Lenders'
respective Commitments (as in effect immediately prior to such
Acceleration), but only to the extent required so that the Cash Collateral
Value of each Lender's Cash Collateral Account is at least equal to such
Lender's Cash Collateral Requirement, and TWELFTH, to the Borrower or as
otherwise required by law.
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SECTION 6.03. The Cash Collateral Accounts.
(a) The Collateral Agent shall invest and reinvest monies on deposit in
each Lender's Cash Collateral Account in Permitted Investments of such Lender in
accordance with written instructions received from time to time from the
Borrower in the form of Exhibit I or, if an Event of Default shall have occurred
and be continuing, in such Permitted Investments as may be selected by the
Collateral Agent in its sole discretion or upon written instruction received
from such Lender. Any cash held by the Collateral Agent without such written
instructions regarding its investment shall be held by the Collateral Agent in
each Lender's Deposit Account (as such term is defined, with respect to each
Lender, on Schedule 2). The Borrower hereby irrevocably authorizes and empowers
the Collateral Agent, as the attorney-in-fact for the Borrower, to endorse any
check or any other instrument or security to be deposited or held in any Cash
Collateral Account requiring the endorsement of the Borrower, which power is
coupled with an interest and is irrevocable until the Maturity Date and the
payment in full of all Outstanding Credits and other amounts payable by the
Borrower under the Loan Documents.
(b) If no Acceleration shall have occurred, on each Business Day following
the distribution of funds described in Section 6.02(b), the Collateral Agent
shall distribute funds held in the Cash Collateral Account of any Lender in the
following priority and amounts, unless directed otherwise by such Lender and the
Borrower (with the consent of the Trustee if such directions would affect the
priority of any payment to the Trustee or any of its officers, directors,
employees, shareholders or agents):
FIRST, to the payment of the fees and expenses of the Trustee and any
indemnity payable by the Borrower to the Trustee or its officers,
directors, employees, shareholders or agents; SECOND, to the payment of
other operating expenses of the Borrower certified by the Borrower to the
Collateral Agent to be then due and payable, in accordance with
instructions of the Borrower included in such certificate; THIRD, to the
payment of any fees (other than the Fees) and expenses then due and payable
to such Lender (including any such fees and expenses payable to such Lender
in its capacity as an LC Bank) under the Loan Documents; FOURTH, to the
payment of Commitment Fees then due and payable to such Lender; FIFTH, to
the payment of LC Fees then due and payable to such Lender in its capacity
as an LC Bank; SIXTH, to the payment of any interest then due and payable
on the Loans made by such Lender; SEVENTH, to the payment of any
reimbursement obligations in respect of Letters of Credit issued by such
Lender in its capacity as an LC Bank then due and payable; EIGHTH, to the
payment of principal of the Loans made by such Lender then due and payable;
NINTH, to the payment of all other obligations of the Borrower under the
Loan Documents not otherwise described in this Section 6.03(b) then due and
payable to such Lender (including any such obligations payable to such
Lender in its capacity as an LC Bank); TENTH, to be held as cash in such
Cash Collateral Account or invested in Permitted Investments in accordance
with subsection (a) above; and ELEVENTH, on the date of any Restricted
Payment permitted under clause (i) or (ii) of Section 5.13, to payment to
the Borrower or its designee in respect of such Restricted Payment.
39
(c) If Acceleration shall have occurred, all Collateral held by the
Collateral Agent in the Cash Collateral Account of any Lender (including
deposits and investments thereof in the Cash Collateral Account) and all cash
proceeds received by the Collateral Agent in respect of any sale of, collection
from, or other realization upon all or any part of such Collateral shall be
applied to the payment of the fees and expenses of the Trustee and any indemnity
payable by the Borrower to the Trustee or its officers, directors, employees,
shareholders or agents, and the balance may, in the discretion of the Collateral
Agent, or shall, at the instruction of such Lender, be held by the Collateral
Agent as Collateral for the Agents and such Lender, and then or at any time
thereafter distributed in whole or in part by the Collateral Agent in the
following order of priority, unless otherwise directed by such Lender (with the
consent of the Collateral Agent if such directions would affect the priority of
any payment to any Agent and the consent of the Trustee if such directions
would affect the priority of any payment to the Trustee or any of its officers,
directors, employees, shareholders or agents):
FIRST, to the payment of other operating expenses of the Borrower
(including without limitation any fees, expenses and indemnities due to
agents of the Borrower, including the Trustee) certified by the Borrower to
the Collateral Agent to be then due and payable, in accordance with
instructions of the Borrower included in such certificate; SECOND, to the
costs and expenses (including attorneys' fees and expenses), if any,
incurred by the Administrative Agent and the Collateral Agent in connection
with the collection of such amounts under the Loan Documents, including,
without limitation, any costs incurred in connection with the sale or
disposition of such Collateral; THIRD, to the payment of other fees and
expenses then due and payable to the Collateral Agent under the Loan
Documents; FOURTH, to the payment of other fees and expenses then due and
payable to the Administrative Agent under the Loan Documents; FIFTH, to the
payment of Commitment Fees then due and payable to such Lender; SIXTH, to
the payment of LC Fees then due and payable to such Lender in its capacity
as an LC Bank; SEVENTH, to the payment of any interest then due and payable
on the Loans made by such Lender; EIGHTH, to the payment of any
reimbursement obligations in respect of Letters of Credit issued by such
Lender in its capacity as an LC Bank then due and payable; NINTH, to the
payment of principal of the Loans made by such Lender then due and payable;
TENTH, to the payment of all other obligations of the Borrower under the
Loan Documents not otherwise described in this Section 6.03(c) then due and
payable to such Lender (including any such fees and expenses payable to
such Lender in its capacity as an LC Bank); ELEVENTH, to be retained as
further Collateral in such Cash Collateral Account, but only to the extent
required so that the Cash Collateral Value of such Cash Collateral Account
is at least equal to such Lender's Cash Collateral Requirement; TWELFTH, to
the Lenders' Cash Collateral Accounts pro rata in accordance with the
Lenders' respective Commitments (as in effect immediately prior to the
termination or reduction of the Commitments prior to such Acceleration),
but only to the extent required so that the Cash Collateral Value of each
Lender's Cash Collateral Account is at least equal to such Lender's Cash
Collateral Requirement; and THIRTEENTH, to the Borrower or as otherwise
required by law.
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SECTION 6.04. Prepayments and Deposits of Cash Collateral at the Request
of the Borrower.
(a) If and for so long as no Event of Default shall have occurred and be
continuing, on the date of any transfer of funds by the Borrower to the
Collateral Agent pursuant to Section 2.11(a) or (b) to be applied to the
prepayment of Borrowings and/or the cash collateralization of Outstanding
Credits, the Collateral Agent shall distribute such funds in the following
priority and amounts, unless directed otherwise by the Borrower and the Lenders:
FIRST, to the payment of Commitment Fees on that portion of the Commitments
to be terminated or reduced on such day pro rata in accordance with each
Lender's percentage of all such Commitment Fees then due and payable;
SECOND, to the payment of any interest then due and payable on the Loans to
be prepaid on such date pro rata in accordance with each Lender's
percentage of all such obligations then due and payable; THIRD, to the
payment of principal of the Loans to be prepaid on such date pro rata in
accordance with each Lender's percentage of all such obligations then due
and payable; FOURTH, to the Lenders' Cash Collateral Accounts pro rata in
accordance with the Lenders' respective Commitments (as in effect
immediately prior to such termination or reduction of the Commitments), but
only to the extent required so that the Cash Collateral Value of each
Lender's Cash Collateral Account is at least equal to such Lender's Cash
Collateral Requirement; and FIFTH, to payment to the Borrower or its
designee in respect of a Restricted Payment in an amount equal to any
remaining amount of such funds.
(b) If and for so long as no Event of Default shall have occurred and be
continuing, if the Cash Collateral Value of any Lender shall be less than such
Lender's Cash Collateral Requirement, the Borrower may transfer funds to the
Collateral Agent to be distributed to such Lender's Cash Collateral Accounts pro
rata in accordance with Lenders' respective Commitments, but only to the extent
required so that the Cash Collateral Value of each Lender's Cash Collateral
Account is at least equal to such Lender's Cash Collateral Requirement.
Article VII
EVENTS OF DEFAULT
In case of the happening of any of the following events (each an "Event
of Default"):
(a) any representation or warranty made or deemed made by the Borrower
in or in connection with the execution and delivery of any Loan Document or the
Extensions of Credit hereunder shall prove to have been false or misleading in
any material respect when so made, deemed made or furnished;
(b) default shall be made by the Borrower in the payment of any
principal of any Loan or any reimbursement obligation in respect of any Letter
of Credit when and as the same shall become due and payable, whether at the due
date thereof or at a date fixed for prepayment thereof or by acceleration
thereof or otherwise;
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(c) default shall be made by the Borrower in the payment of any interest
on any Outstanding Credit or any Fee or any other amount (other than an amount
referred to in subsection (b) above) due hereunder, when and as the same shall
become due and payable, and such default shall continue unremedied for a period
of five days;
(d) default shall be made by the Borrower (i) in the due observance or
performance of any covenant, condition or agreement contained in Section 5.01,
5.08, 5.09, 5.10, 5.11, 5.14, 5.15, 5.17 or 5.24, (ii) in the due observance or
performance of any covenant, condition or agreement contained in Section 5.12
and shall remain unremedied for a period of two Business Days following notice
thereof from the Administrative Agent at the request of any Lender, (iii) in the
due performance or observance of any covenant, condition or agreement contained
in Section 5.13 and shall continue unremedied for a period of two Business Days
following the earlier to occur of actual knowledge of such default on the part
of the Borrower and notice thereof from the Administrative Agent at the request
of any Lender, (iv) in the due observance or performance of any covenant,
condition or agreement contained herein (other than those specified in
subsection (b), (c) or (d)(i) through (iii) above) and such default shall
continue unremedied for a period of 30 days after notice thereof from the
Administrative Agent at the request of any Lender to the Borrower or (v) the
performance of any of its obligations under any of the Security Documents;
(e) an involuntary proceeding shall be commenced or an involuntary
petition shall be filed in a court of competent jurisdiction seeking (i) relief
in respect of the Borrower or TXU, or of a substantial part of the property or
assets of the Borrower or TXU, under Title 11 of the United States Bankruptcy
Code, as now constituted or hereafter amended, or any other Federal or state
bankruptcy, insolvency, receivership or similar law, (ii) the appointment of a
receiver, trustee, custodian, sequestrator, conservator or similar official for
the Borrower or TXU or for a substantial part of the property or assets of the
Borrower or TXU or (iii) the winding up or liquidation of the Borrower or TXU;
and such proceeding or petition shall continue undismissed for 60 days or an
order or decree approving or ordering any of the foregoing shall be entered;
(f) the Borrower or TXU shall (i) voluntarily commence any proceeding
or file any petition seeking relief under Title 11 of the United States
Bankruptcy Code, as now constituted or hereafter amended, or any other Federal
or state bankruptcy, insolvency, receivership or similar law, (ii) consent to
the institution of, or fail to contest in a timely and appropriate manner, any
proceeding or the filing of any petition described in (e) above, (iii) apply for
or consent to the appointment of a receiver, trustee, custodian, sequestrator,
conservator or similar official for the Borrower or TXU or for a substantial
part of the property or assets of it or TXU, (iv) file an answer admitting the
material allegations of a petition filed against it in any such proceeding, (v)
make a general assignment for the benefit of creditors, (vi) become unable,
admit in writing its inability or fail generally to pay its debts as they become
due or (vii) take any action for the purpose of effecting any of the foregoing;
(g) a Change in Control shall occur;
(h) one or more judgments or orders for the payment of money in an
aggregate amount in excess of $2,000,000 shall be rendered against the Borrower
and such judgment or order shall remain undischarged or unstayed for a period
of 30 days, or any action shall be legally taken by a judgment creditor to levy
upon assets or properties of the Borrower to enforce any such judgment or
order; or
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(i) at any time after the execution and delivery thereof, any Loan
Document shall cease to be in full force and effect, or any Security Document
shall cease to give the Collateral Agent, for the benefit of the Secured
Parties named therein, the Liens and the rights, powers and privileges
purported to be created thereby (including, without limitation, a perfected
Lien on all of the Collateral, in favor of the Collateral Agent, superior to
and prior to the rights of all third persons and subject to no other Liens);
then, and in every such event, and at any time thereafter during the continuance
of such event, the Administrative Agent: (i) shall at the request, or may with
the consent of the Required Lenders, terminate forthwith the Total Commitment
and the right of the Borrower to request and receive Extensions of Credit; (ii)
shall at the request, or may with the consent of the Required Lenders, declare
the Loans of the Borrower then outstanding to be forthwith due and payable in
whole or in part, whereupon the principal of the Loans so declared to be due and
payable, together with accrued interest thereon and any unpaid accrued Fees and
all other liabilities of the Borrower accrued hereunder shall become forthwith
due and payable, without presentment, demand, protest or any other notice of any
kind, all of which are hereby expressly waived, anything contained herein to the
contrary notwithstanding; provided that in the case of any event described in
subsection (e) or (f) above, the Total Commitment and the right of the Borrower
to request and receive Extensions of Credit shall automatically terminate and
the principal of the Loans then, together with accrued interest thereon and any
unpaid accrued Fees and all other liabilities of the Borrower accrued hereunder
shall automatically become due and payable, without presentment, demand, protest
or any other notice of any kind, all of which are hereby expressly waived by the
Borrower, anything contained herein to the contrary notwithstanding; (iii) (A)
shall at the request, or may with the consent of the Required Lenders, direct
the Collateral Agent to exercise in respect of any and all Shared Collateral and
(B) shall at the request, or may with the consent of any Lender, direct the
Collateral Agent to exercise in respect of any and all Collateral held in such
Lender's Cash Collateral Account, in addition to the other rights and remedies
provided for herein, in the Security Documents and in the other Loan Documents
or otherwise available to the Collateral Agent, the Administrative Agent, the
Lenders or the LC Banks, all rights and remedies of a secured party on default,
including, without limitation, enforcing all the Liens created pursuant to the
Security Documents. Notwithstanding anything to the contrary contained herein,
no notice given or declaration made by the Administrative Agent pursuant to this
Article VII shall affect the obligation of any LC Bank to make any payment under
any Letter of Credit issued by such LC Bank in accordance with the terms of such
Letter of Credit.
Article VIII
THE AGENTS
SECTION 8.01. The Agents Generally.
(a) In order to expedite the transactions contemplated by this
Agreement, CSFB is hereby appointed to act as Administrative Agent and
Collateral Agent on behalf of the Lenders and the LC Banks. Each Lender and LC
Bank hereby irrevocably authorizes the Administrative Agent and the Collateral
Agent to take such actions on behalf of such Lender and such LC Bank and to
exercise such powers as are specifically delegated to the Administrative Agent
and the Collateral Agent by the terms and provisions of the Loan Documents,
together with such actions and powers as are reasonably incidental thereto. The
Collateral Agent is hereby expressly authorized by the Lenders and the LC Banks,
without hereby limiting any implied authority, to receive on behalf of the
Lenders and the LC Banks all payments of principal of and interest on the
Outstanding Credits and all other amounts due to the Lenders and the LC Banks
under the Loan Documents, and promptly to distribute to each Lender and LC Bank
its proper share of each payment so received. The Administrative Agent is hereby
expressly authorized by the Lenders and the LC Banks, without hereby limiting
any implied authority, (i) to give notice on behalf of each Lender and LC Bank
to the Borrower of any Event of Default of which the Administrative Agent has
actual knowledge acquired in connection with its agency hereunder and (ii) to
distribute to each Lender and LC Bank copies of all notices, financial
statements and other materials delivered by the Borrower pursuant to this
Agreement as received by the Administrative Agent.
(b) The Agents may act through their attorneys and agents and shall not
be responsible for the misconduct or negligence of any agent appointed with due
care; neither any Agent nor any of its directors, officers, employees or agents
shall be liable as such for any action taken or omitted by any of them except
for its or his or her own gross negligence or willful misconduct, or be
responsible for any statement, warranty or representation herein or the contents
of any document delivered in connection herewith, or be required to ascertain or
to make any inquiry concerning the performance or observance by the Borrower of
any of the terms, conditions, covenants or agreements contained in any Loan
Document. The Agents shall not be responsible to the Lenders or the LC Banks for
the due execution, genuineness, validity, enforceability or effectiveness of any
Loan Document or other instruments or agreements. The Agents may deem and treat
the Lender or the LC Bank that makes any Extension of Credit as the holder of
the indebtedness resulting therefrom for all purposes hereof until it shall have
received notice from such Lender or LC Bank (as the case may be), given as
provided herein, of the transfer thereof. The Agents shall in all cases be fully
protected in acting, or refraining from acting, in accordance with written
instructions signed by the Required Lenders and, except as otherwise
specifically provided herein, such instructions and any action or inaction
pursuant thereto shall be binding on all the Lenders and LC Banks. Each of the
Agents shall, in the absence of knowledge to the contrary, be entitled to rely
on any instrument or document believed by it in good faith to be genuine and
correct and to have been signed or sent by the proper person or persons. No
Agent or any of its directors, officers, employees or agents shall have any
responsibility to the Borrower on account of the failure of or delay in
performance or breach by the other Agent or any Lender or LC Bank of any of its
obligations hereunder or to the other Agent or any Lender or LC Bank on account
of the failure of or delay in performance or breach by any other Lender or LC
Bank, the other Agent or the Borrower of any of its obligations hereunder or in
connection herewith. Each of the Agents may execute any and all duties hereunder
by or through agents or employees and shall be entitled to rely upon the advice
of legal counsel selected by it with respect to all matters arising hereunder
and shall not be liable for any action taken or suffered in good faith by it in
accordance with the advice of such counsel.
(c) The Lenders and the LC Banks hereby acknowledge that neither Agent
shall be under any duty to take any discretionary action permitted to be taken
by it pursuant to the provisions of any Loan Document unless it shall be
requested in writing to do so by the Required Lenders. The Agents shall not
have any duties or responsibilities, or be required to exercise any rights or
remedies under the Loan Documents, except as expressly set forth in the Loan
Documents.
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(d) With respect to the Extensions of Credit made by it hereunder, each
of the Agents, in its individual capacity and not as an Agent, shall have the
same rights and powers as any other Lender and may exercise the same as though
it were not an Agent, and each of the Agents and its Affiliates may accept
deposits from, lend money to and generally engage in any kind of business with
the Borrower or any Affiliate thereof as if it were not an Agent.
(e) Each Lender agrees (i) to reimburse the Agents, on demand, in the
amount of its pro rata share (based on its Outstanding Credits or, if the amount
of the Outstanding Credits is $0, its Commitment) of any expenses incurred for
the benefit of the Lenders or the LC Banks in its role as Agent, including
counsel fees and compensation of agents and employees paid for services
rendered on behalf of the Lenders or the LC Banks, which shall not have been
reimbursed by the Borrower, and (ii) to indemnify and hold harmless each of the
Agents and any of its directors, officers, employees or agents, on demand, in
the amount of such pro rata share, from and against any and all liabilities,
taxes, obligations, losses, damages, penalties, actions, judgments, suits,
costs, expenses or disbursements of any kind or nature whatsoever that may be
imposed on, incurred by or asserted against it in any way relating to or
arising out of this Agreement or any action taken or omitted by it under this
Agreement to the extent the same shall not have been reimbursed by the Borrower;
provided that no Lender shall be liable to any Agent for any portion of such
liabilities, obligations, losses, damages, penalties, actions, judgments, suits,
costs, expenses or disbursements resulting from the gross negligence or willful
misconduct of such Agent or any of its directors, officers, employees or agents.
(f) Each Lender and LC Bank acknowledges that it has, independently and
without reliance upon the Agents or any other Lender or LC Bank and based on
such documents and information as it has deemed appropriate, made its own credit
analysis and decision to enter into this Agreement. Each Lender and LC Bank also
acknowledges that it will, independently and without reliance upon the Agents or
any other Lender or LC Bank and based on such documents and information as it
shall from time to time deem appropriate, continue to make its own decisions in
taking or not taking action under or based upon the Loan Documents or any
related agreement or any document furnished hereunder or thereunder.
(g) The Collateral Agent may appoint another financial institution (the
"Sub-Agent") to act as the agent for the Collateral Agent pursuant to Section
8.02(d) for the purpose of maintaining the Revenue Account and each Cash
Collateral Account. The Collateral Agent shall have no obligation to perform
such duties as long as the Sub-Agent is acting as such agent and shall not be
liable for the performance or non-performance of such duties by the Sub-Agent.
In acting as such agent for the Collateral Agent, the Sub-Agent, in such
capacity, shall be entitled to the benefit of all provisions of, and be subject
to all obligations under, this Agreement and the other Loan Documents including,
without limitation, this Section 8.01, as though the Sub-Agent were the
Collateral Agent.
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SECTION 8.02. Replacement of Agents.
(a) Resignation. Subject to the appointment and acceptance of a successor
Agent as provided in this subsection (a), either Agent may resign at any time by
notifying the Lenders, the LC Banks and the Borrower. Upon any such resignation,
the Required Lenders shall have the right to appoint a successor Agent
acceptable to the Borrower. If no successor shall have been so appointed by the
Required Lenders and shall have accepted such appointment within 30 days after
the retiring Agent gives notice of its resignation, then the retiring Agent may,
on behalf of the Lenders and the LC Banks, appoint a successor Agent having a
combined capital and surplus of at least $500,000,000 or an Affiliate of any
such bank. Upon the acceptance of any appointment as Agent hereunder by a
successor bank, such successor shall succeed to and become vested with all the
rights, powers, privileges and duties of the retiring Agent and the retiring
Agent shall be discharged from its duties and obligations hereunder. After any
Agent's resignation hereunder, the provisions of this Article and Section 9.05
shall continue in effect for its benefit in respect of any actions taken or
omitted to be taken by it while it was acting as Agent.
(b) Removal. The Lenders may remove any Agent upon 30 days' prior notice
by so notifying the Borrower and, in such event, the Lenders shall appoint a
successor Agent acceptable to the Borrower. Either the Required Lenders or the
Borrower may remove any Agent if (i) such Agent is adjudged bankrupt or
insolvent or (ii) a receiver or other public officer takes charge of such Agent
or its property. If no successor Agent shall have been appointed by the Lenders
and shall have accepted such appointment within 30 days after delivery by the
Lenders of the notice required by the first sentence of this subsection (b),
the Required Lenders or the Borrower may petition any court of competent
jurisdiction for the appointment of a successor Agent. After any Agent's
removal hereunder, the provisions of this Article and Section 9.05 shall
continue in effect for its benefit in respect of any actions taken or omitted
to be taken by it while it was acting as Agent. Upon the acceptance by a
successor Collateral Agent of its appointment as Collateral Agent (x) the
retiring Collateral Agent shall transfer all property held by it as Collateral
Agent to the successor Collateral Agent and (y) such successor Collateral Agent
shall succeed to and become vested with all the rights, powers, privileges and
duties of the retiring Collateral Agent and the retiring Collateral Agent shall
be discharged from its duties and obligations hereunder.
SECTION 8.03. Rights and Duties of the Collateral Agent.
(a) Notwithstanding anything to the contrary in any Loan Document, the
powers conferred on the Collateral Agent under the Loan Documents are solely to
protect its interest (on behalf of the Secured Parties) in the Collateral and
shall not impose any duty upon it to exercise any such powers. Except for the
reasonable care of any Collateral in its possession and the accounting for
moneys actually received by it under the Loan Documents, the Collateral Agent
shall have no duty as to any Collateral, or responsibility, for (i)
ascertaining or taking action with respect to calls, conversions, exchanges,
maturities, tenders or other matters relative to any investment property
constituting Collateral, whether or not the Collateral Agent has or is deemed
to have knowledge of such matters, or (ii) taking any necessary steps to
preserve rights against prior parties or any other rights pertaining to any
Collateral. The Collateral Agent shall be deemed to have exercised reasonable
care in the custody and preservation of any Collateral in its possession if
such Collateral is accorded treatment substantially equal to that which it
accords its own property.
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(b) The Collateral Agent shall not be liable for interest on any money
or assets received by it except as the Collateral Agent may agree in writing
with the Borrower. Assets held in trust by the Collateral Agent need not be
segregated from other assets except to the extent required by law.
(c) Before the Collateral Agent acts or refrains from acting, it may
require a certificate of a Responsible Officer at the expense of the Borrower.
The Collateral Agent shall not be liable for any action it takes or omits to
take in good faith in reliance on such officer's certificate.
(d) The Collateral Agent shall not be liable for any action that it
takes or omits to take in good faith that it reasonably believes to be
authorized or within its rights or powers under the Security Documents.
(e) The Collateral Agent shall not be bound to make any investigation
into the facts or matters stated in any resolution, certificate, statement,
instrument, opinion, notice, request, direction, consent, order, bond,
debenture, or other paper or document, but the Collateral Agent, in its
discretion, may make such further inquiry or investigation into such facts or
matters as it may see fit and, if the Collateral Agent shall determine to make
such further inquiry or investigation, it shall be entitled, upon reasonable
notice to the Borrower, to examine the books, records and premises of the
Borrower, personally or by agent or attorney and to consult with the officers
and representatives of the Borrower, including the Borrower's accountants and
attorneys. Except as expressly stated herein to the contrary, in no event shall
the Collateral Agent have any responsibility to ascertain whether there has
been compliance with any of the covenants or provisions of the Security
Documents.
(f) The Collateral Agent shall be under no obligation to exercise any of
the rights or powers vested in it by the Security Documents at the request,
order or direction of the Required Lenders (with respect to the Security
Agreement) or of the "Bank" (as defined in and with respect to each Pledge
Agreement) unless such Lenders shall have offered to the Collateral Agent
security or indemnity reasonably satisfactory to the Collateral Agent against
the costs, expenses and liabilities that may be incurred by it in compliance
with such request, order or direction.
(g) The Collateral Agent shall not be required to give any bond or
surety in respect of the performance of its powers and duties under the
Security Documents.
(h) The Collateral Agent may from time to time, at its option, perform
any act that the Borrower agrees hereunder to perform and that the Borrower
shall fail to perform after being requested in writing so to perform (it being
understood that no such request need be given after the occurrence of an Event
of Default) and the Collateral Agent may from time to time take any other action
that the Collateral Agent reasonably deems necessary for the maintenance,
preservation or protection of any of the Collateral or of its security interest
therein.
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(i) The Collateral Agent is authorized to endorse, in the name of the
Borrower, any item, howsoever received by the Collateral Agent, representing
any payment on or other proceeds of any of the Collateral.
Article IX
MISCELLANEOUS
SECTION 9.01. Notices.
Notices and other communications provided for herein shall be in
writing and shall be delivered by hand or overnight courier service, mailed, or
sent by telecopy, as follows:
(a) if to the Borrower, c/o Wilmington Trust Company, Rodney Square
North, 1100 North Market Street, Wilmington, DE 19890-0001, Attention:
Corporate Capital Markets (facsimile: (302) 636-4145), with a copy to the
Administrator, at TXU Business Services Company, Energy Plaza, 1601 Bryan
Street, 33rd Floor, Dallas, TX 75201, Attention: Treasurer
(Telecopy No. 214-812-2488);
(b) if to the Administrative Agent or the Collateral Agent, to Eleven
Madison Avenue, Mail Stop OMA-02, New York, NY 10010-3629, Attention:
Christopher Kim/Agency Group (facsimile: (212) 325-8304);
(c) if to a Lender or LC Bank, to it at its address (or telecopy number)
set forth in the Register or in the Assignment and Acceptance pursuant to which
such Lender or LC Bank became a party hereto; or
(d) as to each party hereto, at such other address as shall be
designated by such party in a written notice to each other party hereto.
All notices and other communications given to any party hereto in
accordance with the provisions of this Agreement shall be deemed to have been
given on the date of receipt if delivered by hand or overnight courier service
or sent by telecopy to such party as provided in this Section or in accordance
with the latest unrevoked direction from such party given in accordance with
this Section.
SECTION 9.02. Survival of Agreement.
All covenants, agreements, representations and warranties made by the
Borrower herein and in the certificates or other instruments prepared or
delivered in connection with or pursuant to this Agreement shall be considered
to have been relied upon by the Lenders and the LC Banks and shall survive the
making by the Lenders and the LC Banks of all Extensions of Credit regardless of
any investigation made by the Lenders or the LC Banks or on their behalf, and
shall continue in full force and effect as long as the principal of or any
accrued interest on any Outstanding Credit or any Fee or any other amount
payable under this Agreement is outstanding and unpaid or the Commitments have
not been terminated.
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SECTION 9.03. Binding Effect.
This Agreement shall become effective when duly executed by the parties
hereto, and thereafter shall be binding upon and inure to the benefit of the
parties hereto and the Trustee, which is an intended third party beneficiary
hereof, and their respective successors and assigns, except that the Borrower
shall not have the right to assign any rights hereunder or any interest herein
without the prior consent of all the Lenders.
SECTION 9.04. Successors and Assigns.
(a) Whenever in this Agreement any of the parties hereto is referred to,
such reference shall be deemed to include the successors and assigns of such
party, and all covenants, promises and agreements by or on behalf of any party
that are contained in this Agreement shall bind and inure to the benefit of its
successors and assigns.
(b) Each Lender may assign to one or more assignees all or a portion of
its interests, rights and obligations under this Agreement (including (i) all or
a portion of its Commitment and the Outstanding Credits at the time owing to it
and (ii) its rights and obligations as an LC Bank); provided, however, that (i)
except in the case of an assignment to another Lender or to an Affiliate of such
Lender, an assignment to a Federal Reserve Bank or an assignment made at any
time an Event of Default shall have occurred and be continuing, the Borrower (if
no Event of Default has occurred and is continuing) and the Administrative Agent
must give their prior written consent to such assignment (in each case, which
consent shall not be unreasonably withheld), (ii) the amount of the Commitment
of the assigning Lender subject to each such assignment (determined as of the
date the Assignment and Acceptance with respect to such assignment is delivered
to the Administrative Agent) shall not be less than $1,000,000 or, if the amount
of the Commitment of the assigning Lender is less than $1,000,000, the aggregate
amount of such Lender's Commitment, (iii) each such assignment shall be of a
constant, and not a varying, percentage of all the assigning Lender's rights and
obligations under the Loan Dcouments and (iv) the parties to each such
assignment shall execute and deliver to the Administrative Agent an Assignment
and Acceptance. Upon acceptance and recording pursuant to Section 9.04(e), from
and after the effective date specified in each Assignment and Acceptance, which
effective date shall be at least five Business Days after the execution thereof
unless otherwise agreed by the Administrative Agent (the Borrower to be given
reasonable notice of any shorter period), (A) the assignee thereunder shall be a
party hereto and, to the extent of the interest assigned by such Assignment and
Acceptance, have the rights and obligations of a Lender and LC Bank under the
Loan Documents and (B) the assigning Lender thereunder shall, to the extent of
the interest assigned by such Assignment and Acceptance, be released from its
obligations under the Loan Documents (and, in the case of an Assignment and
Acceptance covering all or the remaining portion of an assigning Lender's rights
and obligations under this Agreement, such Lender shall cease to be a party
hereto (but shall continue to be entitled to the benefits of Sections 2.12, 2.17
and 9.05 afforded to such Lender prior to its assignment as well as to any Fees
accrued for its account hereunder and not yet paid)). Notwithstanding the
foregoing, any Lender assigning its rights and obligations under this Agreement
may retain any Loans made by it outstanding at such time, and in such case shall
retain its rights hereunder in respect of any Loans so retained until such Loans
have been repaid in full in accordance with this Agreement.
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(c) By executing and delivering an Assignment and Acceptance, the
assigning Lender thereunder and the assignee thereunder shall be deemed to
confirm to and agree with each other and the other parties hereto as follows:
(i) such assigning Lender warrants that it is the legal and beneficial owner of
the interest being assigned thereby free and clear of any adverse claim, (ii)
except as set forth in (i) above, such assigning Lender makes no representation
or warranty and assumes no responsibility with respect to any statements,
warranties or representations made in or in connection with the Loan Documents,
or the execution, legality, validity, enforceability, genuineness, sufficiency
or value of the Loan Documents or any other instrument or document furnished
pursuant hereto or the financial condition of the Borrower or the performance or
observance by the Borrower of any obligations under the Loan Documents or any
other instrument or document furnished pursuant hereto, (iii) such assignor and
such assignee represents and warrants that it is legally authorized to enter
into such Assignment and Acceptance, (iv) such assignee confirms that it has
received a copy of this Agreement, together with copies of the most recent
financial statements delivered pursuant to Section 5.04 and such other documents
and information as it has deemed appropriate to make its own credit analysis and
decision to enter into such Assignment and Acceptance, (v) such assignee will
independently and without reliance upon the Agents, such assigning Lender or any
other Lender or LC Bank 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, (vi) such assignee
appoints and authorizes each Agent to take such action as agent on its behalf
and to exercise such powers under this Agreement as are delegated to such Agent
by the terms hereof, together with such powers as are reasonably incidental
thereto, and (vii) such assignee agrees that it will perform in accordance with
their terms all the obligations that by the terms of the Loan Documents are
required to be performed by it as a Lender.
(d) The Administrative Agent shall maintain at one of its offices in
the City of New York a copy of each Assignment and Acceptance delivered to it
and a register for the recordation of the names and addresses of the Lenders,
and the Commitment of, and the principal amount of the Outstanding Credits
owing to, each Lender pursuant to the terms hereof from time to time
(the "Register"). The entries in the Register shall be conclusive in the
absence of manifest error and the Borrower, the Agents, the LC Banks and the
Lenders may treat each person whose name is recorded in the Register pursuant
to the terms hereof as a Lender hereunder for all purposes of this Agreement.
The Register shall be available for inspection by each party hereto, at any
reasonable time and from time to time upon reasonable prior notice.
(e) Upon its receipt of a duly completed Assignment and Acceptance
executed by an assigning Lender and an assignee and, if required, the written
consent of the Borrower and the Administrative Agent to such assignment, the
Administrative Agent shall (i) accept such Assignment and Acceptance and
(ii) record the information contained therein in the Register.
(f) Each Lender may without the consent of the Borrower or the
Administrative Agent sell participations to one or more banks or other entities
in all or a portion of its rights and/or obligations under the Loan Dcouments
(including all or a portion of its Commitment and the Outstanding Credits owing
to it); provided, however, that (i) such Lender's obligations under the Loan
Documents shall remain unchanged, (ii) such Lender shall remain solely
responsible to the other parties hereto for the performance of such obligations,
(iii) each participating bank or other entity shall be entitled to the benefit
of the cost protection provisions contained in Sections 2.12, 2.17 and 9.05 to
the same extent as if it were the selling Lender (and limited to the amount that
could have been claimed by the selling Lender had it continued to hold the
interest of such participating bank or other entity), except that all claims
made pursuant to such Sections shall be made through such selling Lender, and
(iv) the Borrower, the Agents, the LC Banks and the other Lenders shall continue
to deal solely and directly with such selling Lender in connection with such
Lender's rights and obligations under the Loan Documents, and such Lender shall
retain the sole right to enforce the obligations of the Borrower under this
Agreement and to approve any amendment, modification or waiver of any provision
of this Agreement (other than amendments, modifications or waivers
(x) decreasing any fees payable hereunder or the amount of principal of, or the
rate at which interest is payable on, the Outstanding Credits, (y) extending
any scheduled principal payment date or date fixed for the payment of interest
on the Outstanding Credits or (z) extending the Commitments).
50
(g) Any Lender or participant may, in connection with any assignment or
participation or proposed assignment or participation pursuant to this Section,
disclose to the assignee or participant or proposed assignee or participant any
information relating to the Borrower furnished to such Lender by or on behalf of
the Borrower; provided that, prior to any such disclosure, each such assignee or
participant or proposed assignee or participant shall execute an agreement
whereby such assignee or participant shall agree (subject to customary
exceptions) to preserve the confidentiality of any such information.
(h) The Borrower shall not assign or delegate any rights and duties
hereunder without the prior written consent of all Lenders, and any attempted
assignment or delegation by the Borrower without such consent shall be void.
(i) Any Lender may at any time pledge all or any portion of its rights
under this Agreement to a Federal Reserve Bank; provided that no such pledge
shall release any Lender from its obligations hereunder or substitute any such
Bank for such Lender as a party hereto. In order to facilitate such an
assignment to a Federal Reserve Bank, the Borrower shall, at the request of the
assigning Lender, duly execute and deliver to the assigning Lender a promissory
note or notes evidencing the Extensions of Credit made to the Borrower by the
assigning Lender hereunder.
SECTION 9.05. Expenses; Indemnity.
(a) The Borrower agrees to pay (i) all reasonable out-of-pocket expenses
incurred by the Agents in connection with entering into this Agreement (whether
or not the transactions hereby contemplated are consummated) and in connection
with any amendments, modifications or waivers of the provisions hereof (but only
if such amendments, modifications or waivers are requested by the Borrower),
including the reasonable fees and disbursements of one counsel for the Agents,
the Lenders and LC Banks and (ii) all reasonable out-of-pocket expenses incurred
by the Agents, any LC Bank or any Lender in connection with any claim or claims
arising out of or in connection with the transactions contemplated by this
Agreement and enforcement following an Event of Default, including the
reasonable fees and disbursements of counsel for the Agents, the Lenders and the
LC Banks. In addition to the foregoing, the Borrower shall pay or reimburse the
LC Banks for such reasonable, normal and customary costs and expenses as are
incurred or charged by the LC Banks in issuing, negotiating, effecting payment
under, amending or otherwise administering any Letter of Credit.
51
(b) The Borrower agrees to indemnify each Lender and LC Bank against
any loss, calculated in accordance with the next sentence, or reasonable
expense that such Lender or LC Bank (as the case may be) may sustain or incur
as a consequence of (i) any failure by the Borrower to borrow or to refinance,
convert or continue any Loan hereunder (including as a result of the Borrower's
failure to fulfill any of the applicable conditions set forth in Article IV)
after irrevocable notice of such borrowing, refinancing, conversion or
continuation has been given pursuant to Section 2.03, (ii) any payment,
prepayment or conversion, or assignment of a Eurodollar Loan of the Borrower
required by any other provision of this Agreement or otherwise made or deemed
made on a date other than the last day of the Interest Period, if any,
applicable thereto, (iii) any default in payment or prepayment of the principal
amount of any Outstanding Credit or any part thereof or interest accrued
thereon, as and when due and payable (at the due date thereof, whether by
scheduled maturity, acceleration, irrevocable notice of prepayment or otherwise)
or (iv) the occurrence of any Event of Default, including, in each such case,
any loss or reasonable expense sustained or incurred or to be sustained or
incurred by such Lender in liquidating or employing deposits from third parties,
or with respect to commitments made or obligations undertaken with third
parties, to effect or maintain any Loan hereunder or any part thereof as a
Eurodollar Loan. Such loss shall include an amount equal to the excess, if any,
as reasonably determined by such Lender, of (x) its cost of obtaining the funds
for the Loan being paid, prepaid, refinanced, converted or not borrowed
(assumed to be the LIBO) for the period from the date of such payment,
prepayment, refinancing or failure to borrow or refinance to the last day of
the Interest Period for such Loan (or, in the case of a failure to borrow or
refinance the Interest Period for such Loan that would have commenced on the
date of such failure) over (y) the amount of interest (as reasonably determined
by such Lender) that would be realized by such Lender in reemploying the funds
so paid, prepaid or not borrowed or refinanced for such period or Interest
Period, as the case may be.
(c) The Borrower agrees to indemnify the Agents, each Lender, each LC
Bank, each of their Affiliates and the directors, officers, employees and agents
of the foregoing (each such person being called an "Indemnitee") against, and to
hold each Indemnitee harmless from, any and all losses, claims, damages,
liabilities and related expenses, including reasonable counsel fees and
expenses, incurred by or asserted against any Indemnitee arising out of (i) the
preparation, execution, delivery, enforcement, performance and administration
of this Agreement, (ii) the use of the proceeds of the Extensions of Credit or
(iii) any claim, litigation, investigation or proceeding relating to any of the
foregoing, whether or not any Indemnitee is a party thereto, including any of
the foregoing arising from the negligence, whether sole or concurrent, on the
part of any Indemnitee; provided that such indemnity shall not, as to any
Indemnitee, be available to the extent that such losses, claims, damages,
liabilities or related expenses (x) are determined by a final judgment of a
court of competent jurisdiction to have resulted from the gross negligence or
willful misconduct of such Indemnitee or (y) result from any litigation brought
by such Indemnitee against the Borrower or by the Borrower against such
Indemnitee, in which a final, nonappealable judgment has been rendered against
such Indemnitee; provided, further, that the Borrower agrees that it will not,
without the prior written consent of each Indemnitee, settle, compromise or
consent to the entry of any judgment in any pending or threatened claim, action,
suit or proceeding in respect of which indemnification could be sought under the
indemnification provisions of this Section 9.05(c) (whether or not any
Indemnitee is an actual or potential party to such claim, action, suit or
proceeding), unless such settlement, compromise or consent does not include any
statement as to an admission of fault, culpability or failure to act by or on
behalf of any Indemnitee and does not involve any payment of money or other
value by any Indemnitee or any injunctive relief or factual findings or
stipulations binding on any Indemnitee.
52
(d) The provisions of this Section shall remain operative and in full
force and effect regardless of the expiration of the term of this Agreement, the
consummation of the transactions contemplated hereby, the repayment of any of
the Outstanding Credits, the expiration or termination of the Commitment, the
invalidity or unenforceability of any term or provision of this Agreement or any
investigation made by or on behalf of any Agent, Lender or LC Bank. All amounts
due under this Section shall be payable on written demand therefor.
(e) A certificate of any Lender, LC Bank or Agent setting forth any
amount or amounts that such Lender, LC Bank or Agent is entitled to receive
pursuant to subsection (b) of this Section and containing an explanation in
reasonable detail of the manner in which such amount or amounts shall have been
determined shall be delivered to the Borrower and shall be conclusive absent
manifest error.
SECTION 9.06. Limitation on Liability of the Trustee.
It is expressly understood and agreed by the parties that (i) this
document is executed and delivered by Wilmington Trust Company, not individually
or personally, but solely as Trustee, in the exercise of the powers and
authority conferred and vested in it pursuant to the Trust Agreement, (ii) each
of the representations, undertakings and agreements herein made on the part of
the Borrower is made and intended not as a personal representation, undertaking
and agreement by Wilmington Trust Company but is made and intended for the
purpose for binding only the Borrower, (iii) nothing herein contained shall be
construed as creating any liability on Wilmington Trust Company, individually or
personally, to perform any covenant, either expressed or implied, contained
herein, all such liability, if any, being expressly waived by the parties hereto
and by any person claiming by, through or under the parties hereto, and (iv)
under no circumstances shall Wilmington Trust Company be personally liable for
the payment of any indebtedness or expenses of the Borrower or be liable for the
breach or failure of any obligation, representation, warranty or covenant made
or undertaken by the Borrower under this Agreement or any other related
documents.
SECTION 9.07. Right of Setoff.
If an Event of Default shall have occurred and be continuing, each
Lender and LC Bank is hereby authorized at any time and from time to time, to
the fullest extent permitted by law, to set off and apply any and all deposits
(general or special, time or demand, provisional or final) at any time held and
other indebtedness at any time owing by such Lender or LC Bank to or for the
credit or the account of the Borrower against any of and all the obligations of
the Borrower now or hereafter existing under this Agreement held by such Lender
or LC Bank (as the case may be), irrespective of whether or not such Lender or
LC Bank (as the case may be) shall have made any demand under this Agreement and
although such obligations may be unmatured. The rights of each Lender and LC
Bank under this Section are in addition to other rights and remedies (including
other rights of setoff) that such Lender or LC Bank (as the case may be) may
have.
53
SECTION 9.08. Applicable Law.
THIS AGREEMENT SHALL BE CONSTRUED IN ACCORDANCE WITH, AND GOVERNED BY,
THE LAWS OF THE STATE OF NEW YORK.
SECTION 9.09. Waivers; Amendment.
(a) No failure or delay of either Agent or any Lender or LC Bank in
exercising any power or right hereunder shall operate as a waiver thereof, nor
shall any single or partial exercise of any such right or power, or any
abandonment or discontinuance of steps to enforce such a right or power,
preclude any other or further exercise thereof or the exercise of any other
right or power. The rights and remedies of the Agents, the Lenders and the LC
Banks hereunder are cumulative and are not exclusive of any rights or remedies
that they would otherwise have. No waiver of any provision of this Agreement or
consent to any departure therefrom shall in any event be effective unless the
same shall be permitted by subsection (b) below, and then such waiver or
consent shall be effective only in the specific instance and for the purpose
for which given. No notice or demand on the Borrower in any case shall entitle
such party to any other or further notice or demand in similar or other
circumstances.
(b) Neither this Agreement nor any provision hereof may be waived,
amended or modified except pursuant to an agreement or agreements in writing
entered into by the Borrower and the Required Lenders; provided, however, that
no such agreement shall (i) decrease the principal amount of, or extend the
maturity of or any scheduled principal payment date or date for the payment of
any interest on any Outstanding Credit, or waive or excuse any such payment or
any part thereof, or decrease the rate of interest on any Outstanding Credit,
without the prior written consent of each Lender affected thereby, (ii) increase
any Commitment or decrease the Commitment Fee of any Lender without the prior
written consent of such Lender, (iii) amend or modify the provisions of Section
2.14, 2.15, 6.02, 6.03, 6.04 or 9.04(h), the provisions of this Section, the
definition of "Cash Collateral Requirement" or "Required Lenders", or (iv)
release any of the Collateral (other than in connection with Restricted Payments
permitted under Section 5.13), without the prior written consent of each Lender
affected thereby; provided further, however, that no such agreement shall amend,
modify or otherwise affect the rights or duties of the Administrative Agent, the
Collateral Agent, any LC Bank or the Trustee without the prior written consent
of the Administrative Agent, the Collateral Agent, such LC Bank or the Trustee,
as the case may be; and provided further, the definition of "Permitted
Investments" specified for any Lender in Schedule 2 may be amended by the
Borrower and such Lender as provided in the definition of such term. Each Lender
and LC Bank shall be bound by any waiver, amendment or modification authorized
by this Section and any consent by any Lender, any Agent or any LC Bank pursuant
to this Section shall bind any assignee of its rights and interests hereunder.
SECTION 9.10. Entire Agreement.
This Agreement (including the schedules and exhibits hereto) and the
Letter Agreement represent the entire contract among the parties relative to the
subject matter hereof and thereof. Any previous agreement, whether written or
oral, among the parties with respect to the subject matter hereof, is superseded
by this Agreement and the Letter Agreement. There are no unwritten oral
agreements between the parties. Nothing in this Agreement, expressed or implied,
is intended to confer upon any party other than the parties hereto and the
Trustee, which is an intended third party beneficiary hereof, any rights,
remedies, obligations or liabilities under or by reason of this Agreement.
54
SECTION 9.11. Severability.
In the event any one or more of the provisions contained in this
Agreement should be held invalid, illegal or unenforceable in any respect, the
validity, legality and enforceability of the remaining provisions contained
herein shall not in any way be affected or impaired thereby. The parties shall
endeavor in good-faith negotiations to replace the invalid, illegal or
unenforceable provisions with valid provisions the economic effect of which
comes as close as possible to that of the invalid, illegal or unenforceable
provisions.
SECTION 9.12. Counterparts.
This Agreement may be executed in two or more counterparts, each of
which shall constitute an original but all of which when taken together shall
constitute but one contract, and shall become effective as provided in Section
9.03.
SECTION 9.13. Headings.
Article and Section headings and the Table of Contents used herein are
for convenience of reference only, are not part of this Agreement and are not to
affect the construction of, or to be taken into consideration in interpreting,
this Agreement.
SECTION 9.14. Interest Rate Limitation.
(a) Notwithstanding anything herein to the contrary, if at any time the
applicable interest rate, together with all fees and charges that are treated as
interest under applicable law (collectively the "Charges"), as provided for
herein or in any other document executed in connection herewith, or otherwise
contracted for, charged, received, taken or reserved by any Lender or LC Bank,
shall exceed the maximum lawful rate (the "Maximum Rate") which may be
contracted for, charged, taken, received or reserved by such Lender or LC Bank
(as the case may be) in accordance with applicable law, the rate of interest
payable on the Outstanding Credits of such Lender or LC Bank (as the case may
be), together with all Charges payable to such Lender or LC Bank (as the case
may be), shall be limited to the Maximum Rate.
(b) If the amount of interest, together with all Charges, payable for
the account of any Lender or LC Bank in respect of any interest computation
period is reduced pursuant to subsection (a) of this Section and the amount of
interest, together with all Charges, payable for such Lender's or LC Bank's (as
the case may be) account in respect of any subsequent interest computation
period, computed pursuant to Section 2.07, would be less than the Maximum Rate,
then the amount of interest, together with all Charges, payable for such
Lender's or LC Bank's (as the case may be) account in respect of such subsequent
interest computation period shall, to the extent permitted by applicable law, be
automatically increased to such Maximum Rate; provided that at no time shall the
aggregate amount by which interest paid for the account of any Lender or LC Bank
has been increased pursuant to this subsection (b) exceed the aggregate amount
by which interest, together with all Charges, paid for its account has
theretofore been reduced pursuant to subsection (a) of this Section.
55
SECTION 9.15. Jurisdiction; Venue.
(a) The Borrower hereby irrevocably and unconditionally submits, for
itself and its property, to the nonexclusive jurisdiction of any New York State
court or Federal court of the United States of America sitting in New York City,
and any appellate court from any thereof, in any action or proceeding arising
out of or relating to this Agreement, or for recognition or enforcement of any
judgment, and each of the parties hereto hereby irrevocably and unconditionally
agrees that all claims in respect of any such action or proceeding may be heard
and determined in such New York State or, to the extent permitted by law, in
such Federal court. Each of the parties hereto agrees that a final judgment in
any such action or proceeding shall be conclusive and may be enforced in other
jurisdictions by suit on the judgment or in any other manner provided by law.
Subject to the foregoing and to subsection (b) below, nothing in this Agreement
shall affect any right that any party hereto may otherwise have to bring any
action or proceeding relating to this Agreement against any other party hereto
in the courts of any jurisdiction.
(b) The Borrower hereby irrevocably and unconditionally waives, to the
fullest extent it may legally and effectively do so, any objection that it may
now or thereafter have to the laying of venue of any suit, action or proceeding
arising out of or relating to this Agreement in any New York State court or
Federal court of the United States of America sitting in New York City. Each of
the parties hereto hereby irrevocably waives, to the fullest extent permitted by
law, the defense of an inconvenient forum to the maintenance of such action or
proceeding in any such court.
SECTION 9.16. Confidentiality.
Each Lender and LC Bank shall use its best efforts to hold in
confidence all information, memoranda, or extracts furnished to such Lender or
LC Bank (as the case may be) (directly or through the Agents) by the Borrower
hereunder or in connection with the negotiation hereof; provided that such
Lender and LC Bank may disclose any such information, memoranda or extracts (i)
to its Affiliates, accountants or counsel, (ii) to any regulatory agency having
authority to examine such Lender or LC Bank (as the case may be), (iii) as
required by any legal or governmental process or otherwise by law, (iv) to any
person to which such Lender or LC Bank (as the case may be) sells or proposes to
sell an assignment or a participation in its Extensions of Credit hereunder, if
such other person agrees for the benefit of the Borrower to comply with the
provisions of this Section, and (v) to the extent that such information,
memoranda or extracts shall be publicly available or shall have become known to
such Lender or LC Bank (as the case may be) independently of any disclosure by
the Borrower hereunder or in connection with the negotiation hereof.
Notwithstanding the foregoing, any Lender and any LC Bank may disclose the
provisions of this Agreement and the amounts, maturities and interest rates of
its Outstanding Credits to any purchaser or potential purchaser of such Lender's
or LC Bank's (as the case may be) interest in any Outstanding Credits.
Notwithstanding the foregoing, each party hereto (and each officer, director,
56
employee, representative, agent and advisor of each party hereto) may disclose
to any and all persons, without limitation of any kind, the "tax treatment" and
"tax structure" (in each case within the meaning of Treasury Regulation Section
1.6011-4) of the transactions contemplated by the Loan Documents and all
materials of any kind (including opinions or other tax analyses) that are
provided to such person relating to such "tax treatment" and "tax structure".
The foregoing is intended to comply with the presumption set forth in Treasury
Regulation Section 1.6011-4(b)(3)(iii) and should be interpreted in a manner
consistent with such regulation.
[Signature pages follow]
S-1
IN WITNESS WHEREOF, the parties hereto have caused this Agreement to be
duly executed by their respective authorized officers as of the day and year
first above written.
LOC 2003 TRUST
By WILMINGTON TRUST COMPANY, not in its
individual capacity but solely in
its capacity as Trustee
By /s/ Kathleen A. Pedelini
-----------------------------------------
Name: Kathleen A. Pedelini
Title: Financial Services Officer
S-2
CREDIT SUISSE FIRST BOSTON, as Administrative
Agent, Collateral Agent, Lender and LC Bank
By /s/ Sarah Wu
-------------------------------------------
Name: Sarah Wu
Title: Vice President
By /s/ David J. Dodd
-------------------------------------------
Name: David J. Dodd
Title: Associate
S-3
JPMORGAN CHASE BANK,
As Lender and LC Bank
By /s/ Robert W. Tranband
------------------------------------------------
Name: Robert W. Traband
Title: Vice President
S-4
CITIBANK, N.A.,
As Lender and LC Bank
By /s/ Sandip Sen
---------------------------------------------------
Name: Sandip Sen
Title: Managing Director
Schedule 1
COMMITMENTS
- -------------------------------------------------------------------------------
NAME OF LENDER COMMITMENT
- -------------------------------------------------------------------------------
Credit Suisse First Boston $176,470,588
- -------------------------------------------------------------------------------
JPMorgan Chase Bank $176,470,588
- -------------------------------------------------------------------------------
Citibank, N.A. $147,058,824
- -------------------------------------------------------------------------------
Total $500,000,000
- -------------------------------------------------------------------------------
Schedule 2
PERMITTED INVESTMENTS
Permitted Investments shall, with respect to CSFB, mean:
- --------------------------------------------------------
(a) cash and account # 217048 at The Bank of New York (CSFB's "Deposit
Account"), including all cash held therein and earnings thereon;
(b) time deposits held by CSFB; and
(c) U.S. government securities with a maturity of less than 90 days.
Permitted Investments shall, with respect to JPMorgan Chase Bank, mean:
- -----------------------------------------------------------------------
(a) direct obligations of the United States of America, or of any agency
thereof, or obligations guaranteed as to principal and interest by the United
States of America, or by any agency thereof, in either case maturing not more
than 90 days from the date of acquisition thereof;
(b) certificates of deposit denominated in U.S. dollars issued by any
bank or trust company organized under the laws of the United States of America,
Canada, England, France, Germany, Japan, The Netherlands or Switzerland or any
political subdivision of any thereof and having capital, surplus and undivided
profits of at least $500,000,000 (or its equivalent in any other currency) and
whose commercial paper or short-term deposit obligations are rated A-1 or
better or P-1 by S&P (or any successor thereto) or Moody's (or any successor
thereto), respectively, maturing not more than 90 days from the date of
acquisition thereof;
(c) commercial paper denominated in U.S. dollars rated A-1 or better or
P-1 by S&P (or any successor thereto) or Moody's (or any successor thereto),
respectively, maturing not more than 90 days from the date of acquisition
thereof;
(d) shares in money market mutual funds so long as, with respect to each
such fund,
(i) the aggregate net asset value of such fund on the date of
acquisition of any shares thereof is not less than $500,000,000 (or its
equivalent in any other currency);
(ii) not less than 95% (measured by market value) of the portfolio
of such fund consists of obligations described in one or more of clauses
(a), (b) and (c) above or of other debt securities whose credit quality
and liquidity are not less than the credit quality and liquidity of the
obligations described in such clauses;
(iii) the fund is rated AAA by S&P (or any successor thereto) or
Aaa by Moody's (or any successor thereto);
(iv) the shares issued by such fund represent proportionate and
undivided interests in the portfolio of assets owned by such fund;
(v) the principal amount represented by the shares in such fund may
at any time be redeemed at par within 30 days after a notice of
redemption; and
2
(vi) on the date of investment, the principal amount invested by
the Collateral Agent in such fund does not exceed 10% of the aggregate
net asset value of such fund; provided that Permitted Investments shall
not include:
(A) any obligations providing for the payment of interest or
principal only (other than obligations referred to in clause
(c) above issued at a discount);
(B) any obligations containing an express contingency
regarding the repayment of all of the principal thereof; or
(C) any "swap agreement" as defined in Section 101(53B) of
the United States Bankruptcy Code (11 U.S.C. ss. 101(53B)); and
(e) cash and account # 217046 at The Bank of New York (JPMorgan Chase
Bank's "Deposit Account"), including all cash held therein and earnings thereon.
Permitted Investments shall, with respect to Citibank, N.A., mean:
- -----------------------------------------------------------------
(a) direct obligations of the United States of America, or of any agency
thereof, or obligations guaranteed as to principal and interest by the United
States of America, or by any agency thereof, in either case maturing not more
than 90 days from the date of acquisition thereof;
(b) certificates of deposit denominated in U.S. dollars issued by any
bank or trust company organized under the laws of the United States of America,
Canada, England, France, Germany, Japan, The Netherlands or Switzerland or any
political subdivision of any thereof and having capital, surplus and undivided
profits of at least $500,000,000 (or its equivalent in any other currency) and
whose commercial paper or short-term deposit obligations are rated A-1 or
better or P-1 by S&P (or any successor thereto) or Moody's (or any successor
thereto), respectively, maturing not more than 90 days from the date of
acquisition thereof;
(c)commercial paper denominated in U.S. dollars rated A-1 or better or
P-1 by S&P (or any successor thereto) or Moody's (or any successor thereto),
respectively, maturing not more than 90 days from the date of acquisition
thereof;
(d) shares in money market mutual funds so long as, with respect to each
such fund,
(i) the aggregate net asset value of such fund on the date of
acquisition of any shares thereof is not less than $500,000,000 (or its
equivalent in any other currency);
(ii) not less than 95% (measured by market value) of the portfolio
of such fund consists of obligations described in one or more of clauses
(a), (b) and (c) above or of other debt securities whose credit quality
and liquidity are not less than the credit quality and liquidity of the
obligations described in such clauses;
(iii) the fund is rated AAA by S&P (or any successor thereto) or Aaa by
Moody's (or any successor thereto);
(iv) the shares issued by such fund represent proportionate and
undivided interests in the portfolio of assets owned by such fund;
(v) the principal amount represented by the shares in such fund may at
any time be redeemed at par within 30 days after a notice of redemption;
and
3
(vi) on the date of investment, the principal amount invested by
the Collateral Agent in such fund does not exceed 10% of the aggregate
net asset value of such fund; provided that Permitted Investments shall
not include:
(A) any obligations providing for the payment of interest or
principal only (other than obligations referred to in clause
(c) above issued at a discount);
(B) any obligations containing an
express contingency regarding the repayment of all of the principal
thereof; or
C) any "swap agreement" as defined in Section 101(53B) of the
United States Bankruptcy Code (11 U.S.C. ss. 101(53B)); and
(e) cash and account # 217047 at The Bank of New York (Citibank's Deposit
Account"), including all cash held therein and earnings thereon.
EXHIBIT A
Form of Borrowing Request
[Date]
Credit Suisse First Boston, as
Administrative Agent for the Lenders
referred to below
Eleven Madison Avenue
Mail Stop OMA-02
New York, New York 10010-3629
Attention: Christopher Kim/Agency Group
(facsimile: (212) 325-8304)
Attention:
Telecopy:
Ladies and Gentlemen:
The undersigned, LOC 2003 Trust (the "Borrower"), refers to the Credit
Agreement, dated as of August 8, 2003 (as amended, modified, extended or
restated from time to time, the "Agreement"), among the Borrower, the lenders
named therein (the "Lenders") and Credit Suisse First Boston, as administrative
agent and collateral agent for the Lenders. Capitalized terms used herein and
not otherwise defined herein shall have the meanings assigned to such terms in
the Agreement. The Borrower hereby gives you notice pursuant to Section 2.03 of
the Agreement that it requests a Borrowing under the Agreement, and in that
connection sets forth below the terms on which such Borrowing is requested to be
made:
(A) Date of Borrowing (which is a Business Day) -----------
(B) Principal amount of Borrowing1 -----------
(C) Interest rate basis2 -----------
(D) Interest Period and the last day thereof3 -----------
The undersigned hereby certifies that (i) the Cash Collateral Value of
each Lender's Cash Collateral Account is at least equal to the amount set forth
below and (ii) the Outstanding Credits of each Lender do not exceed such
Lender's Commitment.
LENDER CASH COLLATERAL VALUE
------ ---------------------
[Name] $[______________]
[Name] $[______________]
[Name] $[______________]
- ------------------------
1 Not less than $25,000,000 (and in integral multiples of $5,000,000) or
greater than the Total Commitment then available.
2 Eurodollar Loan or ABR Loan.
3 Which shall be subject to the definition of "Interest Period" and
end not later than the Maturity Date.
A-2
Upon acceptance of any or all of the Loans made by the Lenders in
response to this request, the Borrower shall be deemed to have represented and
warranted that the applicable conditions to lending specified in Article IV of
the Agreement have been satisfied.
Very truly yours,
LOC 2003 TRUST
By WILMINGTON TRUST COMPANY, not in
its individual capacity but solely in
its capacity as Trustee
By_______________________________
Name:
Title:
A-3
EXHIBIT B
Form of Request for Issuance
[Date]
Credit Suisse First Boston, as
Administrative Agent for the Lenders
referred to below
Eleven Madison Avenue
Mail Stop OMA-02
New York, New York 10010-3629
Attention: Christopher Kim/Agency Group
(facsimile: (212) 325-8304)
Attention:
Telecopy:
[NAME OF LC BANK]
[ADDRESS OF LC BANK]
Attention:
Telecopy:
Ladies and Gentlemen:
LOC 2003 Trust (the "Borrower"), refers to the Credit Agreement, dated
as of August 8, 2003 (as amended, modified, extended or restated from time to
time, the "Agreement"), among the Borrower, the lenders named therein (the
"Lenders") and Credit Suisse First Boston, as administrative agent and
collateral agent for the Lenders, and hereby gives you notice, irrevocably,
pursuant to Section 2.04(a) of the Agreement, that the undersigned hereby
requests the issuance of a Letter of Credit, and in connection therewith sets
forth below the terms on which such Letter of Credit is to be issued:
(i) (a) the beneficiary of the Letter of Credit requested hereby
is ----------------, with an address at -------------;
(b) the obligations in respect of which such Letter of Credit
is to be issued are as follows: ---------------------;
(ii) (a) the conditions under which a drawing may be made under such
Letter of Credit are as follows: -----------------------;
(b) the documentation required in respect of such Letter of
Credit is as follows: -----------------------------;
(iii) the maximum amount to be available under such Letter of
Credit is -----------------------;
(iv) the requested date of issuance (which is a Business Day) is
-------------------; and
(v) the expiration date of the Letter of Credit requested hereby
is ---------------------1
The undersigned hereby certifies that (i) the Cash Collateral Value of
each Lender's Cash Collateral Account is at least equal to the amount set forth
below and (ii) the Outstanding Credits of each Lender do not exceed such
Lender's Commitment.
LENDER CASH COLLATERAL VALUE
------ ---------------------
[Name] $[______________]
[Name] $[______________]
[Name] $[______________]
Upon the issuance of the Letter of Credit by the LC Bank in response to
this request, the Borrower shall be deemed to have represented and warranted
that the applicable conditions to an issuance of a Letter of Credit that are
specified in Article IV of the Agreement have been satisfied.
Very truly yours,
LOC 2003 TRUST
By WILMINGTON TRUST COMPANY, not in
its individual capacity, but solely
in its capacity as Trustee
By_______________________________
Name:
Title:
- ----------------------------
1 Modify request as appropriate if used in connection with the
extension, modification or amendment of a Letter of Credit. 1 CSFB undertakes no
obligation to invest in all Permitted Investments occurring at this price. 2 To
be no earlier than one Business Day after the date of these investment
instructions.
B-2
EXHIBIT C
Form of Pledge Agreement
EXHIBIT D
Form of Security Agreement
EXHIBIT E
Form of Control Agreement
EXHIBIT F
Form of Assignment and Acceptance
ASSIGNMENT AND ACCEPTANCE
Dated: --------------------
Reference is made to the Credit Agreement, dated as of August 8, 2003
(as amended, modified, extended or restated from time to time, the "Agreement"),
among LOC 2003 Trust, the lenders named therein (the "Lenders") and Credit
Suisse First Boston, as administrative agent and collateral agent for the
Lenders. Terms defined in the Agreement are used herein with the same meanings.
1. The Assignor hereby sells and assigns, without recourse, to the
Assignee, and the Assignee hereby purchases and assumes, without recourse, from
the Assignor, effective as of the [Effective Date of Assignment set forth
below], the interests set forth on the reverse hereof (the "Assigned Interest")
in the Assignor's rights and obligations under the Agreement, including, without
limitation, the interests set forth on the reverse hereof in the Commitment of
the Assignor on the [Effective Date of Assignment] and the Extensions of Credit
owing to the Assignor which are outstanding on the [Effective Date of
Assignment], together with unpaid interest accrued on the assigned Extensions of
Credit to the [Effective Date of Assignment] and the amount, if any, set forth
on the reverse hereof of the Fees accrued to the [Effective Date of Assignment]
for the account of the Assignor. Each of the Assignor and the Assignee hereby
makes and agrees to be bound by all the representations, warranties and
agreements set forth in Section 9.04 of the Agreement, a copy of which has been
received by each such party. From and after the [Effective Date of Assignment],
(i) the Assignee shall be a party to and be bound by the provisions of the
Agreement and, to the extent of the interests assigned by this Assignment and
Acceptance, have the rights and obligations of a Lender thereunder and (ii) the
Assignor shall, to the extent of the interests assigned by this Assignment and
Acceptance, relinquish its rights and be released from its obligations under the
Agreement.
2. This Assignment and Acceptance is being delivered to the
Administrative Agent together with (i) if the Assignee is organized under the
laws of a jurisdiction outside the United States, the forms specified in Section
2.17(g) of the Agreement, duly completed and executed by such Assignee, and (ii)
if the Assignee is not already a Lender under the Agreement, an Administrative
Questionnaire in the form of Exhibit B to the Agreement.
3. This Assignment and Acceptance shall be governed by and
construed in accordance with the laws of the State of New York.
Date of Assignment:
Legal Name of Assignor:
Legal Name of Assignee:
Assignee's Address for Notices:
Effective Date of Assignment (may not be fewer than 5 Business Days after the
Date of Assignment unless otherwise agreed by the Administrative Agent):
F-2
=============== ============================ ===============================
Percentage Assigned of
Facility/Commitment(set forth,
Facility Principal Amount Assigned to at least 8 decimals, as a
(and identifying information percentage of the Facility and
as to individual Loans) the aggregate Commitments of
all Lenders thereunder
Commitment Assigned: $____________ __________%
Loans: $____________ __________%
Letters of Credit: $____________ __________%
Fees Assigned (if any): $____________ __________%
F-3
The terms set forth and on the Accepted:
reverse side hereof are LOC 2003 TRUST
hereby agreed to: by WILMINGTON TRUST COMPANY,
not in its individual capacity,
, as but solely in its capacity as
- ------------------------------------ Trustee
Assignor
By , as By
------------------------------- ----------------------------
Name: Name:
Title: Title:
, as CREDIT SUISSE FIRST BOSTON,
- ------------------------------------ as Administrative Agent
Assignee,
By , as By
--------------------------------- ----------------------------
Name: Name:
Title: Title:
By
-----------------------------
Name:
Title
F-4
EXHIBIT G
Form of Promissory Note
PROMISSORY NOTE
August __, 2003
$______________ New York, New York
FOR VALUE RECEIVED, the undersigned, LOC 2003 TRUST, a Delaware
statutory trust (the "Borrower"), HEREBY PROMISES TO PAY to the order of
_____________________ or registered assigns (the "Lender"), on the Maturity Date
(such term, and each other capitalized term used but not defined herein, having
the meaning ascribed thereto in the Credit Agreement (as defined below)), for
the account of the Lender at the office of the Collateral Agent under the Credit
Agreement, in lawful money of the United States of America and in immediately
available funds, the principal sum of ___________________________DOLLARS
($_____________) or, if less, the aggregate principal amount of the Loans made
by the Lender to the Borrower pursuant to the Credit Agreement outstanding on
such Maturity Date; provided, however, that the principal amount outstanding
under this Promissory Note is subject to prepayment and repayment from time to
time, with accrued interest thereon, as specified in the Credit Agreement. The
Borrower further agrees to pay interest in like money to the Lender on the
unpaid principal amount hereof from the date hereof at such interest rates, and
payable at such times, as specified in the Credit Agreement.
The Lender is authorized to record on the schedule annexed hereto (i)
the date and amount of each Loan made by the Lender to the Borrower, (ii) the
character thereof as an ABR Loan or a Eurodollar Loan, (iii) the interest rate
and the Interest Period applicable to each Eurodollar Loan, and (iv) the date
and amount of each conversion of, and each payment or prepayment of principal
of, each Loan; provided, that the failure to so record or any error in so
recording shall not affect the payment obligations of the Borrower hereunder or
under the Credit Agreement.
This Promissory Note is delivered pursuant to, and is entitled to the
benefits of, the Credit Agreement, dated as of August __, 2003 (as the same may
be amended, modified or supplemented, the "Credit Agreement"), among the
Borrower, the lenders party thereto (the "Banks") and Credit Suisse First
Boston, as Administrative Agent and Collateral Agent. The Credit Agreement,
among other things, (i) provides for the making of Loans by the Banks to the
Borrower from time to time in an aggregate outstanding amount not to exceed at
any time the Total Commitment, the indebtedness of the Borrower to the Lender
resulting from each such Loan made by the Lender being evidenced by this
Promissory Note, and (ii) contains provisions for acceleration of the maturity
hereof upon the happening of certain stated events and also for prepayments on
account of principal hereof prior to the maturity hereof upon the terms and
conditions therein specified. The Borrower hereby waives presentment, demand,
protest and notice of any kind. No failure to exercise, and no delay in
exercising, any rights hereunder on the part of the holder hereof shall operate
as a waiver of such rights.
This Promissory Note shall be governed by, and construed in accordance
with, the laws of the State of New York, United States.
LOC 2003 TRUST
By WILMINGTON TRUST COMPANY,
not in its individual capacity but solely as
Trustee
By _________________________________
Name:
Title:
G-2
LOANS, MATURITIES AND PAYMENTS OF PRINCIPAL
========== ========== ========== =========== ========== ========= ================= =============== =================
Amount of
Principal Unpaid
Amount Type of Maturity of Interest Interest Converted, Paid Principal Notation
Date of Loans Loan Loans Rate Period or Prepaid Balance Made By
========== ========== ========= ============ ========== ========= ================= =============== =================
---------- ---------- --------- ------------ ---------- --------- ----------------- --------------- -----------------
---------- ---------- --------- ------------ ---------- --------- ----------------- --------------- -----------------
---------- ---------- --------- ------------ ---------- --------- ----------------- --------------- -----------------
---------- ---------- --------- ------------ ---------- --------- ----------------- --------------- -----------------
---------- ---------- --------- ------------ ---------- --------- ----------------- --------------- -----------------
---------- ---------- --------- ------------ ---------- --------- ----------------- --------------- -----------------
---------- ---------- --------- ------------ ---------- --------- ----------------- --------------- -----------------
---------- ---------- --------- ------------ ---------- --------- ----------------- --------------- -----------------
---------- ---------- --------- ------------ ---------- --------- ----------------- --------------- -----------------
---------- ---------- --------- ------------ ---------- --------- ----------------- --------------- -----------------
---------- ---------- --------- ------------ ---------- --------- ----------------- --------------- -----------------
---------- ---------- --------- ------------ ---------- --------- ----------------- --------------- -----------------
========== ========== ========= ============ ========== ========= ================= =============== =================
EXHIBIT H
Form of Cash Collateral Value Report
[Date]
- -------------------- ---------------- -------------- -------------- --------- -------------- --------------------- --------------
Account Description of Number of Date Acquired Cost Current Accrued Interest/ Current
Collateral Shares* Share Cost* Accreted Yield* Value
- -------------------- ---------------- -------------- -------------- --------- -------------- --------------------- --------------
Credit Suisse
First Boston Cash
Collateral
Account
- ---------------------------------------------------------------------------------------------------------------------------------
Total:______________
- ----------------------------------------------------------------------------------------------------------------------------------
Citibank, N.A.
Cash Collateral
Account
- ----------------------------------------------------------------------------------------------------------------------------------
Total:______________
- ---------------------------------------------------------------------------------------------------------------------------------
JPMorgan Chase
Bank Cash
Collateral Account
- ----------------------------------------------------------------------------------------------------------------------------------
Total:______________
- ----------------------------------------------------------------------------------------------------------------------------------
* If applicable
EXHIBIT I
Form of Investment Instructions
[Date]
Credit Suisse First Boston, as Collateral
Agent for the Lenders referred to below
Eleven Madison Avenue
Mail Stop OMA-02
New York, New York 10010-3629
Attention: Christopher Kim/Agency Group
Telecopy: (212) 325-8304
Re: Deposit Account of [LENDER]
Ladies and Gentlemen:
Pursuant to Section 6.03 of the Credit Agreement, dated as of August 8,
2003 (as amended, modified, extended or restated from time to time, the
"Agreement"; terms used herein without definition are used as therein defined),
among the undersigned, the lenders named therein and Credit Suisse First Boston,
as administrative agent and collateral agent for the lenders, we hereby instruct
you to invest monies on deposit in account #_______________ at The Bank of New
York (the "Applicable Deposit Account"), held by you for the benefit of the
secured parties pursuant to the Pledge and Control Agreement ([LENDER]), dated
as of August 8, 2003, between the undersigned and you, as follows:
(i) the type/name of investment to be made is as follows:
_______________________;
(ii) the indicative price of such investment shall be __________;1
(iii) the investment shall be made during the period
a. from [BEGINNING DATE]2 to
b. [INSERT ENDING DATE];
(iv) remittances from the Applicable Deposit Account shall be
directed to ___________________________;
(v) in order to execute such investment, please contact:
Name: ____________________________
- --------------------
1 CSFB undertakes no obligation to invest in all Permitted Investments
occurring at this price.
2 To be no earlier than one Business Day after the date of these investment
instructions.
Firm: ____________________________
Address: ____________________________
Telecopy: ____________________________
Phone: ____________________________
The undersigned hereby certifies that the investment to be made
pursuant to these instructions is a Permitted Investment.
Very truly yours,
LOC 2003 TRUST
By TXU BUSINESS SERVICES COMPANY,
as Administrator
By_______________________________
Name:
Title: