Exhibit 10.15
$400,000,000
CREDIT AGREEMENT
Dated as of November 21, 1997
Among
ELECTRIC LIGHTWAVE, INC.
as Borrower
CITIZENS UTILITIES COMPANY
as Parent Guarantor
and
THE LENDERS NAMED HEREIN
as Lenders
and
CITIBANK, N.A.
as Administrative Agent
T A B L E O F C O N T E N T S
Section Page
ARTICLE I
DEFINITIONS AND ACCOUNTING TERMS
SECTION 1.01. Certain Defined Terms................................ 1
SECTION 1.02. Computation of Time Periods.......................... 14
SECTION 1.03. Accounting Terms..................................... 14
ARTICLE II
AMOUNTS AND TERMS OF THE ADVANCES
SECTION 2.01. The A Advances....................................... 14
SECTION 2.02. Making the A Advances................................ 15
SECTION 2.03. The B Advances....................................... 17
SECTION 2.04. Certain Fees......................................... 21
SECTION 2.05. Changes in and Extensions of the
Commitments............................ 21
SECTION 2.06. Repayment of A Advances.............................. 23
SECTION 2.07. Interest............................................. 23
SECTION 2.08. Additional Interest on Eurodollar
Rate Advances.......................... 24
SECTION 2.09. Interest Rate Determinations; Changes
in Rating Systems...................... 25
SECTION 2.10. Voluntary Conversion and Continuation
of A Advances.......................... 27
SECTION 2.11. Prepayments of A Advances............................ 28
SECTION 2.12. Increased Costs...................................... 28
SECTION 2.13. Illegality........................................... 29
SECTION 2.14. Payments and Computations............................ 30
SECTION 2.15. Taxes................................................ 32
SECTION 2.16. Sharing of Payments, Etc............................. 35
ARTICLE III
CONDITIONS OF LENDING
SECTION 3.01. All Borrowings....................................... 35
SECTION 3.02. First Borrowing...................................... 36
ARTICLE IV
REPRESENTATIONS AND WARRANTIES
SECTION 4.01. Organization; Powers; Governmental
Approvals.............................. 37
SECTION 4.02. Financial Statements. .............................. 38
SECTION 4.03. No Material Adverse Change........................... 38
SECTION 4.04. Title to Properties; Possession Under Leases......... 39
SECTION 4.05. Ownership of Subsidiaries............................ 39
(i)
Section Page
SECTION 4.06. Litigation; Compliance with Laws..................... 39
SECTION 4.07. Agreements........................................... 40
SECTION 4.08. Federal Reserve Regulations.......................... 40
SECTION 4.09. Investment Company Act; Public
Utility Holding Company Act............ 40
SECTION 4.10. Use of Proceeds...................................... 40
SECTION 4.11. Tax Returns.......................................... 40
SECTION 4.12. No Material Misstatements............................ 40
SECTION 4.13. Employee Benefit Plans............................... 41
SECTION 4.14. Insurance............................................ 41
ARTICLE V
AFFIRMATIVE COVENANTS
SECTION 5.01. Existence, Businesses and Properties................. 42
SECTION 5.02. Financial Statements, Reports, etc................... 43
SECTION 5.03. Litigation and other Notices......................... 44
SECTION 5.04. Maintaining Records.................................. 45
SECTION 5.05. Use of Proceeds...................................... 45
ARTICLE VI
NEGATIVE COVENANTS
SECTION 6.01. Liens................................................ 46
SECTION 6.02. Ownership of the Principal Subsidiaries.............. 46
SECTION 6.03. Asset Sales.......................................... 46
SECTION 6.04. Mergers.............................................. 47
SECTION 6.05. Restrictions on Dividends............................ 47
SECTION 6.06. Transactions with Affiliates......................... 48
SECTION 6.07. Minimum Consolidated Net Worth....................... 48
SECTION 6.08. Subsidiary Guarantors................................ 48
ARTICLE VII
EVENTS OF DEFAULT
ARTICLE VIII
THE ADMINISTRATIVE AGENT
SECTION 8.01. Authorization and Action............................. 51
SECTION 8.02. Administrative Agent's Reliance, Etc................. 52
SECTION 8.03. Citibank and Affiliates.............................. 53
SECTION 8.04. Lender Credit Decision............................... 53
SECTION 8.05. Indemnification...................................... 53
SECTION 8.06. Successor Administrative Agent....................... 54
(ii)
Section Page
ARTICLE IX
MISCELLANEOUS
SECTION 9.01. Amendments, Etc...................................... 54
SECTION 9.02. Notices, Etc......................................... 55
SECTION 9.03. No Waiver; Remedies.................................. 56
SECTION 9.04. Costs, Expenses and Indemnification.................. 56
SECTION 9.05. Right of Set-off..................................... 57
SECTION 9.06. Binding Effect....................................... 58
SECTION 9.07. Assignments, Designations and
Participations......................... 58
SECTION 9.08. Governing Law; Submission to
Jurisdiction........................... 63
SECTION 9.09. Severability......................................... 63
SECTION 9.10. Execution in Counterparts............................ 64
SECTION 9.11. Survival............................................. 64
SECTION 9.12. Waiver of Jury Trial................................. 64
SECTION 9.13. Substitution of Lender............................... 64
SECTION 9.14. Confidentiality...................................... 65
ARTICLE X
GUARANTEE......................................... 66
SECTION 10.01 The Guarantee........................................ 66
SECTION 10.02 Obligations Unconditional............................ 66
SECTION 10.03 Reinstatement........................................ 67
SECTION 10.04 Subrogation.......................................... 67
SECTION 10.05 Remedies............................................. 68
SECTION 10.07 Continuing Guarantee................................. 68
SECTION 10.08 General Limitation on Guarantee
Obligations............................ 68
SECTION 10.09 Effectiveness of Guarantee........................... 69
(iii)
EXHIBITS
Exhibit A-1 - Form of A Note
Exhibit A-2 - Form of B Note
Exhibit B-1 - Form of Notice of A Borrowing
Exhibit B-2 - Form of Notice of B Borrowing
Exhibit C - Form of Assignment and Acceptance
Exhibit D - Form of Designation Agreement
Exhibit E - Form of Opinion of Assistant General
......... Counsel of the Borrower
Exhibit F - Form of Opinion of Special New York
Counsel to the Administrative Agent
(iv)
CREDIT AGREEMENT, dated as of November 21, 1997, among
ELECTRIC LIGHTWAVE, INC., a Delaware corporation (the "Borrower"), CITIZENS
UTILITIES COMPANY, a Delaware corporation (the "Parent Guarantor"), the
subsidiaries of the Parent Guarantor (the "Subsidiary Guarantors" and, together
with the Parent Guarantor, the "Guarantors") listed on the signature pages
hereof under the caption the "SUBSIDIARY GUARANTORS", the banks (the "Banks")
listed on the signature pages hereof under the caption "BANKS", and CITIBANK,
N.A., a national banking corporation, as administrative agent (in such capacity,
the "Administrative Agent").
The Borrower and the Parent Guarantor have requested the Banks
to extend credit to the Borrower in order to enable the Borrower to borrow on a
revolving credit basis, on and after the date hereof and at any time and from
time to time prior to the Commitment Termination Date (as hereinafter defined) a
principal amount not in excess of $400,000,000 at any time outstanding. The
Borrower and the Parent Guarantor have also requested the Banks to provide a
procedure pursuant to which the Borrower may invite the Banks to bid on an
uncommitted basis on short-term borrowings by the Borrower. The proceeds of such
borrowings are to be used to repay certain intercompany indebtedness owing to
the Parent Guarantor, to provide working capital and for other general corporate
purposes of the Borrower. The Subsidiary Guarantors have agreed to guarantee the
Borrower's obligations hereunder until such time as the Parent Guarantor
receives regulatory approval to guarantee such obligations, at which time the
obligations of the Parent Guarantor hereunder shall become effective and the
Subsidiary Guarantors' obligations hereunder shall terminate. The Banks are
willing to extend such credit to the Borrower on the terms and subject to the
conditions herein set forth.
Accordingly, the parties hereto hereby agree as follows:
ARTICLE I
DEFINITIONS AND ACCOUNTING TERMS
SECTION 1.01. Certain Defined Terms. As used in this
Agreement, the following terms shall have the following meanings (such meanings
to be equally applicable to both the singular and plural forms of the terms
defined):
"A Advance" means an advance by a Lender to the Borrower as
part of an A Borrowing and refers to a Base Rate Advance or a
Eurodollar Rate Advance, each of which shall be a "Type" of A Advance.
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"A Borrowing" means (a) a borrowing consisting of simultaneous
A Advances of the same Type having the same Interest Period and (b)
other than for purposes of Sections 2.02 and 3.02, (i) the simultaneous
Conversion of A Advances of one Type to A Advances of the other Type
(having, in the case of Conversions into Eurodollar Rate Advances, the
same Interest Period) and (ii) the simultaneous Continuation of
Eurodollar Rate Advances as Eurodollar Rate Advances having the same
Interest Period.
"A Note" means a promissory note of the Borrower payable to
the order of any Lender, in substantially the form of Exhibit A-1
hereto, evidencing the aggregate indebtedness of the Borrower to such
Lender resulting from the A Advances made by such Lender.
"Advance" means an A Advance or a B Advance.
"Administrative Fees" has the meaning assigned to such term in
Section 2.04(b).
"Administrative Questionnaire" means an administrative
questionnaire furnished by each Bank to the Administrative Agent in
connection with the execution and delivery of this Agreement.
"Affiliate" means, when used with respect to a specified
person, another person that directly, or indirectly through one or more
intermediaries, Controls or is Controlled or is under common Control
with the person specified.
"Applicable Facility Fee Rate" means:
(i) 5 basis points per annum at such times as (A) the Senior
Debt of the Parent Guarantor shall be rated at least Aa3 by Moody's or
at least AA- by S&P, or (B) the Parent Guarantor's outstanding
commercial paper shall be rated at least P1 by Moody's and at least A1
by S&P;
(ii) 8 basis points per annum at such time as (A) the Senior Debt
of the Parent Guarantor shall be rated less than Aa3 by Moody's and
less than AA- by S&P but at least Baa3 by Moody's and at least BBB- by
S&P, and (B) the Parent Guarantor's outstanding commercial paper shall
be rated P2 by Moody's or A2 by S&P; and
(iii) 22.5 basis points per annum at all other times.
Any change in the Applicable Facility Fee Rate shall be effective on
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the date on which the applicable rating agency announces the applicable
change in rating.
"Applicable Lending Office" means, with respect to each
Lender, such Lender's Domestic Lending Office in the case of a Base
Rate Advance and such Lender's Eurodollar Lending Office in the case of
a Eurodollar Rate Advance and, in the case of a B Advance, the office
of such Lender notified by such Lender to the Administrative Agent as
its Applicable Lending Office with respect to such B Advance.
"Applicable Margin" means:
(i) 13 basis points per annum with respect to Eurodollar Rate
Advances at such times as (A) the Senior Debt of the Parent Guarantor
shall be rated at least Aa3 by Moody's or at least AA- by S&P, or (B)
the Parent Guarantor's outstanding commercial paper shall be rated at
least Pl by Moody's and at least Al by S&P;
(ii) 17 basis points per annum with respect to Eurodollar Rate
Advances at such times as (A) the Senior Debt of the Parent Guarantor
shall be rated less than Aa3 by Moody's and less than AA- by S&P but
shall be rated at least Baa3 by Moody's and at least BBB- by S&P, and
(B) the Parent Guarantor's outstanding commercial paper shall be rated
P2 by Moody's or A2 by S&P; and
(iii) 52.5 basis points per annum with respect to Eurodollar Rate
Advances at all other times.
Any change in the Applicable Margin shall be effective on the date on
which the applicable rating agency announces the applicable change in
rating.
"Approval Date" means the date on which the Parent Guarantor
delivers to the Administrative Agent evidence reasonably satisfactory
to the Administrative Agent that the Parent Guarantor has received the
FERC Approval and the VPSB Approval.
"Assignment and Acceptance" means an assignment and acceptance
entered into by a Lender and an Eligible Assignee, and accepted by the
Administrative Agent, in substantially the form of Exhibit C hereto.
"B Advance" means an advance by a Lender to the Borrower as
part of a B Borrowing resulting from the auction bidding procedure
described in Section 2.03.
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"B Borrowing" means a borrowing consisting of simultaneous B
Advances from each of the Lenders whose offer to make one or more B
Advances as part of such borrowing has been accepted by the Borrower
under the auction bidding procedure described in Section 2.03.
"B Note" means a promissory note of the Borrower payable to
the order of any Lender, in substantially the form of Exhibit A-2
hereto, evidencing the indebtedness of the Borrower to such Lender
resulting from a B Advance made by such Lender.
"B Reduction" has the meaning specified in Section 2.01.
"Base Rate" means, for any period, a fluctuating interest rate
per annum in effect from time to time which rate per annum shall at all
times be equal to the higher of:
(a) the rate of interest announced publicly by
Citibank in New York, New York from time to time as Citibank's
base rate; and
(b) 1/2 of one percent per annum above the Federal
Funds Rate for such period.
"Base Rate Advance" means an A Advance which bears interest as
provided in Section 2.07(a)(i) or 2.07(b)(i)(x).
"Board" means the Board of Governors of the Federal Reserve
System of the United States.
"Borrowing" means an A Borrowing or a B Borrowing.
"Business Day" means a day of the year on which banks are not
required or authorized to close in New York City and, if the applicable
Business Day relates to any Eurodollar Rate Advance, on which dealings
are carried on in the London interbank market.
"Capital Lease Obligations" of any person means the
obligations of such person to pay rent or other amounts under any lease
of (or other arrangement conveying the right to use) real or personal
property, or a combination thereof, which obligations are required to
be classified and accounted for as capital leases on a balance sheet of
such person under GAAP and, for the purposes of this Agreement, the
amount of such obligations at any time shall be the capitalized amount
thereof at such time determined in accordance with GAAP.
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A "Change in Control" shall be deemed to have occurred if (a)
any person or group (within the meaning of Rule 13d-5 of the Securities
and Exchange Commission as in effect on the date hereof) shall own
directly or indirectly, beneficially or of record, shares representing
more than 49% of the aggregate ordinary voting power represented by the
issued and outstanding capital stock of the Parent Guarantor; or (b) a
majority of the seats (other than vacant seats) on the board of
directors of the Parent Guarantor shall at any time have been occupied
by persons who were neither (i) nominated by the management of the
Parent Guarantor nor (ii) appointed by directors so nominated; or (c)
any person or group shall otherwise directly or indirectly Control the
Parent Guarantor.
"Closing Date" means the date of the first Borrowing hereunder
or such earlier date as the parties may agree.
"Code" means the Internal Revenue Code of 1986, as the same
may be amended from time to time.
"Commitment" has the meaning specified in Section 2.01.
"Commitment Termination Date" means the fifth anniversary of
the date hereof or such later date to which the Commitment Termination
Date is extended pursuant to Section 2.05(c), provided in each case
that if such date is not a Business Day, then the Commitment
Termination Date shall be the immediately preceding Business Day.
"Consolidated Net Worth" means, as at any date of
determination, the consolidated stockholders' equity of the Parent
Guarantor and its consolidated Subsidiaries, as determined on a
consolidated basis in conformity with GAAP consistently applied.
"Consolidated Tangible Assets" of any person means total
assets of such person and its consolidated Subsidiaries, determined on
a consolidated basis, less goodwill, patents, trademarks and other
assets classified as intangible assets in accordance with GAAP.
"Continuation", "Continue" and "Continued" each refers to a
continuation of Eurodollar Rate Advances from one Interest Period to
the next Interest Period pursuant to Section 2.10.
"Control" means the possession, directly or indirectly, of the
power to direct or cause the direction of the management or policies of
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a person, whether through the ownership of voting securities, by
contract or otherwise, and "Controlling" and "Controlled" shall have
meanings correlative thereto.
"Convert", "Conversion" and "Converted" each refers to a
conversion of Advances of one Type into Advances of the other Type
pursuant to Section 2.09 or 2.10.
"Default" means any event or condition which upon notice,
lapse of time, or both would constitute an Event of Default.
"Designated Bidder" means (a) an Eligible Assignee or (b) a
special purpose corporation which is engaged in making, purchasing or
otherwise investing in commercial loans in the ordinary course of its
business and that issues (or the parent of which issues) commercial
paper rated at least P-1 by Moody's or A-1 by S&P (or a comparable
rating from a successor of either of them), that, in either case, (i)
is organized under the laws of the United States or any State thereof,
(ii) shall have become a party hereto pursuant to Section 9.07(d), (e)
and (f), and (iii) is not otherwise a Lender.
"Designation Agreement" means a designation agreement entered
into by a Lender (other than a Designated Bidder) and a Designated
Bidder, and accepted by the Administrative Agent, in substantially the
form of Exhibit D hereto.
"Domestic Lending Office" means, with respect to any Lender,
the office of such Lender specified as its "Domestic Lending Office" in
the Administrative Questionnaire of such Lender or in the Assignment
and Acceptance pursuant to which it became a Lender, or such other
office of such Lender as such Lender may from time to time specify to
the Borrower and the Administrative Agent.
"Effective Date" means the earliest date as of which the
conditions precedent to effectiveness set forth in Section 3.01 shall
have been satisfied or waived.
"Eligible Assignee" means:
(a) a commercial bank organized under the laws of the United
States, or any State thereof, and having total assets in excess of
$100,000,000;
(b) a savings and loan association or savings bank organized
under the laws of the United States, or any State thereof, and having
Credit Agreement
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total assets in excess of $100,000,000;
(c) a commercial bank organized under the laws of any other
country which is a member of the OECD or has concluded special lending
arrangements with the International Monetary Fund associated with its
General Arrangements to Borrow or of the Cayman Islands, or a political
subdivision of any such country, and having total assets in excess of
$100,000,000, provided that such bank is acting through a branch or
agency located in the United States or the Cayman Islands;
(d) the central bank of any country which is a member of the
OECD;
(e) a finance company, insurance company or other financial
institution or fund (whether a corporation, partnership or other
entity) which is engaged in making, purchasing or otherwise investing
in commercial loans in the ordinary course of its business, and having
total assets in excess of $100,000,000;
(f) a Lender; and
(g) an Affiliate of a Lender;
provided that neither the Borrower nor any Affiliate of the Borrower
shall qualify as an Eligible Assignee.
"ERISA" means the Employee Retirement Income Security Act of
1974, as the same may be amended from time to time, and the regulations
promulgated and the rulings issued thereunder.
"ERISA Affiliate" means each trade or business (whether or not
incorporated) which together with the Parent Guarantor or a Subsidiary
of the Parent Guarantor would be deemed to be a "single employer"
within the meaning of Section 4001(b)(1) of ERISA.
"ERISA Termination Event" means (i) a "Reportable Event"
described in Section 4043 of ERISA (other than a "Reportable Event" not
subject to the provision for 30-day notice to the PBGC under such
regulations), or (ii) the withdrawal of the Parent Guarantor or any of
its ERISA Affiliates from a Plan during a plan year in which it was a
"substantial employer" as defined in Section 4001(a)(2) of ERISA, or
(iii) the filing of a notice of intent to terminate a Plan or the
treatment of a Plan amendment as a termination under Section 4041 of
Credit Agreement
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ERISA, or (iv) the institution of proceeding to terminate a Plan by the
PBGC or (v) any other event or condition which might constitute grounds
under Section 4042 of ERISA for the termination of, or the appointment
of a trustee to administer, any Plan.
"Eurocurrency Liabilities" has the meaning assigned to that
term in Regulation D of the Board of Governors of the Federal Reserve
System, as in effect from time to time.
"Eurodollar Lending Office" means, with respect to any Lender,
the office of such Lender specified as its "Eurodollar Lending Office"
in the Administrative Questionnaire of such Lender or in the Assignment
and Acceptance pursuant to which it became a Lender (or, if no such
office is specified, its Domestic Lending Office), or such other office
of such Lender as such Lender may from time to time specify to the
Borrower and the Administrative Agent.
"Eurodollar Rate" means, with respect to any Eurodollar Rate
Advance for any Interest Period, the rate (rounded upward to the
nearest 1/16 of 1%) appearing on Page 3750 of the Dow Jones Markets
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 "Eurodollar Rate" with respect to
such Eurodollar Rate Advance for such Interest Period shall be the
average (rounded upward to the nearest 1/16 of 1%) of the rates at
which dollar deposits of $5,000,000 and for a maturity comparable to
such Interest Period are offered by the principal London offices of the
Reference Banks 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.
"Eurodollar Rate Advance" means an A Advance which bears
interest as provided in Section 2.07(a)(ii) or 2.07(b)(i)(y).
"Eurodollar Rate Reserve Percentage" of any Lender for any
Interest Period for any Eurodollar Rate Advance means the effective
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rate (expressed as a percentage) at which reserve requirements
(including, without limitation, emergency, supplemental and other
marginal reserve requirements) are imposed on such Lender during such
Interest Period (or if more than one such percentage shall be so
applicable, the daily average of such percentages for those days in
such Interest Period during which any such percentage shall be so
applicable) under regulations issued from time to time by the Board of
Governors of the Federal Reserve System (or any successor) with respect
to liabilities or assets consisting of or including Eurocurrency
Liabilities having a term equal to such Interest Period.
"Event of Default" has the meaning assigned to such term in
Article VII.
"Exchange Act" means the Securities Exchange Act of 1934, as
amended from time to time.
"Excluded Period" means, with respect to any additional amount
payable under Section 2.12, the period falling prior to the applicable
Lender's delivery of a certificate referenced in Section 2.12(a) or
2.12(b), as applicable, with respect to such additional amount.
"Facility Fee" has the meaning assigned to such term in
Section 2.04(a).
"Federal Funds Rate" means, for any period, a fluctuating
interest rate per annum equal for each day during such period to the
weighted average of the rates on overnight Federal funds transactions
with members of the Federal Reserve System arranged by Federal funds
brokers, as published for such day (or, if such day is not a Business
Day, for the next preceding Business Day) by the Federal Reserve Bank
of New York, or, if such rate is not so published for any day which is
a Business Day, the average of the quotations for such day on such
transactions received by the Administrative Agent from three Federal
funds brokers of recognized standing selected by it.
"Fees" means the Facility Fee and the Administrative Fees.
"FERC Approval" means the approval by the Federal Energy
Regulatory Commission required for the obligations of the Parent
Guarantor's obligations under Article X to be effective.
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"Financial Officer" of any corporation shall mean the
President, Chief Financial Officer, Chief Executive Officer or
Treasurer of such corporation.
"First Mortgage Bond Indenture" means the First Mortgage and
Collateral Trust Indenture, dated as of March 1, 1947, from the Parent
Guarantor to The Marine Midland Trust Company of New York, as Trustee,
as the same has been and may from time to time be amended or
supplemented and in effect.
"GAAP" means generally accepted accounting principles,
applied on a consistent basis.
"Governmental Approval" means any authorization, consent,
approval, license, franchise, lease, ruling, tariff, rate, permit,
certificate, exemption of, or filing or registration with, any
Governmental Authority required in connection with the execution,
delivery or performance by any Obligor of this Agreement or the Notes.
"Governmental Authority" means any Federal, state, local or
foreign court or governmental agency, authority, instrumentality or
regulatory body.
"Indebtedness" of any person means, without duplication, (a)
all obligations of such person for borrowed money or with respect to
deposits or advances of any kind, (b) all obligations of such person
evidenced by bonds, debentures, notes or similar instruments, (c) all
obligations of such person upon which interest charges are customarily
paid, (d) all obligations of such person under conditional sale or
other title retention agreements relating to property or assets
purchased by such person, (e) all obligations of such person issued or
assumed as the deferred purchase price of property or services, (f) all
Indebtedness of others secured by (or for which the holder of such
Indebtedness has an existing right, contingent or otherwise, to be
secured by) any Lien on property owned or acquired by such person,
whether or not the obligations secured thereby have been assumed, (g)
all Capital Lease Obligations of such person, (h) all obligations of
such person in respect of interest rate protection agreements, foreign
currency exchange agreements or other interest or exchange rate hedging
arrangements, (i) all obligations of such person as an account party in
respect of letters of credit and bankers' acceptances and (j) any
obligation, contingent or otherwise, of such person guaranteeing or
having the economic effect of guaranteeing any Indebtedness of any
other person (the "primary obligor") in any manner, whether directly or
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indirectly, and including any obligation of such person, direct or
indirect (i) to purchase or pay (or advance or supply funds for the
purchase or payment of) such Indebtedness or to purchase (or to advance
or supply funds for the purchase of) any security for the payment of
such Indebtedness, (ii) to purchase property, securities or services
for the purpose of assuring the owner of such Indebtedness of the
payment of such Indebtedness or (iii) to maintain working capital,
equity capital or other financial statement condition or liquidity of
the primary obligor so as to enable the primary obligor to pay such
Indebtedness; provided, however, that the term Indebtedness shall not
include endorsements for collection or deposit, in either case in the
ordinary course of business.
"Interest Period" means, with respect to any Eurodollar Rate
Advance, the period beginning on the date such Eurodollar Rate Advance
is made or Continued, or Converted from a Base Rate Advance, and ending
on the last day of the period selected by the Borrower pursuant to the
provisions below. The duration of each such Interest Period shall be
one, two, three or six or (with the consent of all of the Lenders) nine
or twelve months, as the Borrower may, upon notice received by the
Administrative Agent not later than 11:00 A.M. (New York City time) on
the third Business Day prior to the first day of such Interest Period,
select; provided, however, that:
(i) the Borrower may not select any Interest Period
that ends after the Termination Date;
(ii) each Interest Period that begins on the last Business
Day of a calendar month (or on any day for which there is no
numerically corresponding day in the appropriate subsequent
calendar month) shall end on the last Business Day of the
appropriate subsequent calendar month; and
(iii) whenever the last day of any Interest Period would
otherwise occur on a day other than a Business Day, the last
day of such Interest Period shall be extended to occur on the
next succeeding Business Day, provided that, if such extension
would cause the last day of such Interest Period to occur in
the next following calendar month, the last day of such
Interest Period shall occur on the next preceding Business
Day.
"Lenders" means the Banks listed on the signature pages
hereof, each person that shall become a party hereto pursuant to
Section 9.07(a), (b) and (c), and, except when used in reference to an
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A Advance, an A Borrowing, an A Note, a Commitment or a related term,
each Designated Bidder.
"Lien" means, with respect to any asset (a) any mortgage, deed
of trust, lien, pledge, encumbrance, charge, or security interest in or
on such asset, (b) the interest of a vendor or a lessor under any
conditional sale agreement, capital lease, or title retention agreement
relating to such asset and (c) in the case of securities, any purchase
option, call, or similar right of a third party with respect to such
securities.
"Loan Documents" shall mean this Agreement and the Notes.
"Majority Lenders" means at any time Lenders holding more than
50% of the then aggregate unpaid principal amount of the A Advances
held by Lenders, or, if no such principal amount is then outstanding,
Lenders having more than 50% of the Commitments.
"Margin Regulations" means Regulations G, U and X of the
Board.
"Material Adverse Effect" means a materially adverse effect on
the business, assets, operations, condition, financial or otherwise, or
results of operations of (i) prior to the Approval Date, the Obligors
taken as a whole or (ii) on and after the Approval Date, the Parent
Guarantor and the Subsidiaries taken as a whole.
"Moody's" means Moody's Investors Service, Inc., or any suc-
cessor thereto.
"Note" means an A Note or a B Note.
"Notice of A Borrowing" has the meaning specified in Section
2.02(a).
"Notice of B Borrowing" has the meaning specified in Section
2.03(a).
"Obligors" means the Borrower and the Guarantors.
"OECD" means the Organization for Economic Cooperation and
Development.
"PBGC" means the Pension Benefit Guaranty Corporation referred
to and defined in ERISA.
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"person" means any natural person, corporation, business,
trust, joint venture, association, company, partnership, or government,
or any agency or political subdivision thereof.
"Plan" means any pension plan (including a multiemployer plan)
subject to the provisions of Title IV of ERISA or Section 412 of the
Code which is maintained for or to which contributions are made for
employees of the Parent Guarantor or any ERISA Affiliate.
"Principal Subsidiaries" means any Subsidiary of the Parent
Guarantor whose Consolidated Tangible Assets comprise in excess of 40%
of the Consolidated Tangible Assets of the Parent Guarantor and its
consolidated Subsidiaries as of the date hereof or at any time
hereafter. In any event, the term "Principal Subsidiaries" includes (a)
the Borrower and (b) prior to the Approval Date, the Subsidiary
Guarantors.
"Rating Agencies" means S&P, Moody's and, if either or both of
the foregoing rating agencies shall not rate any long-term senior
indebtedness of any Principal Subsidiary, a nationally-recognized
securities rating agency or agencies selected by the Parent Guarantor
and approved by the Lenders.
"Reference Banks" means Citibank, Bank of America NT&SA and
The Fuji Bank, Limited.
"Register" has the meaning specified in Section 9.07(g).
"S&P" means Standard & Poor's Ratings Services or any success-
or thereto.
"Senior Debt" means so long as any bonds issued pursuant to
the First Mortgage Bond Indenture shall be outstanding and rated by a
Rating Agency, such bonds, and at all other times, the most senior,
unsecured, non-credit enhanced, long-term Indebtedness of the Parent
Guarantor then outstanding.
"subsidiary" means, with respect to any person (herein
referred to as the "parent"), any corporation, partnership,
association, or other business entity (a) of which securities or other
ownership interests representing more than 50% of the equity or more
than 50% of the ordinary voting power or more than 50% of the general
partnership interests are, at the time any determination is being made,
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owned, Controlled, or held, or (b) which is, at the time any
determination is made, otherwise Controlled by the parent or one or
more subsidiaries of the parent or by the parent and one or more
subsidiaries of the parent.
"Subsidiary" means any subsidiary of the Parent Guarantor.
"Termination Date" means the Commitment Termination Date or
the earlier date of termination in whole of the Commitments pursuant to
Section 2.05(a) or Article VII.
"VPSB Approval" means the approval by the Vermont Public
Service Board required for the obligations of the Parent Guarantor's
obligations under Article X to be effective.
SECTION 1.02. Computation of Time Periods. In this Agreement
in the computation of periods of time from a specified date to a later specified
date, the word "from" means "from and including" and the words "to" and "until"
each means "to but excluding".
SECTION 1.03. Accounting Terms. 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; provided,
however, that, for purposes of determining compliance with any covenant set
forth in Articles V and VI, such terms shall be construed in accordance with
GAAP as in effect on the date of this Agreement applied on a basis consistent
with the application used in preparing the Parent Guarantor's audited financial
statements referred to in Section 4.02.
ARTICLE II
AMOUNTS AND TERMS OF THE ADVANCES
SECTION 2.01. The A Advances.
(a) Each Lender severally agrees, on the terms and conditions
hereinafter set forth, to make A Advances to the Borrower from time to time on
any Business Day during the period from the date hereof until the Termination
Date in an aggregate amount not to exceed at any time outstanding the amount set
opposite such Lender's name on the signature pages hereof or, if such Lender has
entered into any Assignment and Acceptance, set forth for such Lender in the
Register, as such amount may be reduced pursuant to Section 2.05(a) (such
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Lender's "Commitment"), provided that the aggregate amount of the Commitments of
the Lenders shall be deemed used from time to time to the extent of the
aggregate amount of the B Advances then outstanding and such deemed use of the
aggregate amount of the Commitments shall be deemed applied to the Lenders
ratably according to their respective Commitments (such deemed use of the
aggregate amount of the Commitments being a "B Reduction").
(b) Each A Borrowing (i) shall (except as otherwise provided
in Sections 2.09(f) and (g)) be in an aggregate amount not less than $10,000,000
or an integral multiple of $1,000,000 in excess thereof and (ii) shall consist
of A Advances of the same Type (and, if such Advances are Eurodollar Rate
Advances, having the same Interest Period) made, Continued or Converted on the
same day by the Lenders ratably according to their respective Commitments.
Within the limits of each Lender's Commitment, the Borrower may from time to
time borrow, prepay pursuant to Section 2.11(b) and reborrow under this Section
2.01.
SECTION 2.02. Making the A Advances.
(a) Each A Borrowing shall be made on notice, given not later
than 11:00 A.M. (New York City time) on the third Business Day prior to the date
of the proposed A Borrowing (in the case of an A Borrowing consisting of
Eurodollar Rate Advances) or given not later than 11:00 A.M. (New York City
time) on the Business Day of the proposed A Borrowing (in the case of an A
Borrowing consisting of Base Rate Advances), by the Borrower to the
Administrative Agent, which shall give to each Lender prompt notice thereof by
telecopier, telex or cable. Each such notice of an A Borrowing (a "Notice of A
Borrowing") shall be by telecopier, telex or cable, in substantially the form of
Exhibit B-1 hereto, specifying therein the requested (i) date of such A
Borrowing, (ii) Type of A Advances comprising such A Borrowing, (iii) aggregate
amount of such A Borrowing, and (iv) in the case of an A Borrowing consisting of
Eurodollar Rate Advances, initial Interest Period for each such A Advance. Each
Lender shall, before 1:00 P.M. (New York City time) on the date of such A
Borrowing, make available for the account of its Applicable Lending Office to
the Administrative Agent at its address referred to in Section 9.02, in same day
funds, such Lender's ratable portion of such A Borrowing. After the
Administrative Agent's receipt of such funds and upon fulfillment of the
applicable conditions set forth in Article III, the Administrative Agent will
make such funds available to the Borrower at the Administrative Agent's
aforesaid address.
(b) Anything in subsection (a) above to the contrary
notwithstanding, the Borrower may not select Eurodollar Rate Advances for any A
Borrowing unless the aggregate principal amount of such is $10,000,000 or an
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integral multiple of $1,000,000 in excess thereof.
(c) Each Notice of A Borrowing shall be irrevocable and
binding on the Borrower. In the case of any A Borrowing which the related Notice
of A Borrowing specifies is to be comprised of Eurodollar Rate Advances, the
Borrower shall indemnify each Lender against any loss, cost or expense incurred
by such Lender as a result of any failure to fulfill, on or before the date
specified in such Notice of A Borrowing, the applicable conditions set forth in
Article III, including, without limitation, any loss (excluding loss of
anticipated profits), cost or expense incurred by reason of the liquidation or
reemployment of deposits or other funds acquired by such Lender to fund the A
Advance to be made by such Lender as part of such A Borrowing. The Borrower
shall pay amounts owing to any Lender pursuant to this Section 2.02(c) within 30
days after receipt from such Lender of a certificate setting forth in reasonable
detail the calculation of the amount such Lender is entitled to claim under this
Section 2.02(c) (which certificate shall be conclusive and binding for all
purposes, absent manifest error).
(d) Unless the Administrative Agent shall have received notice
from a Lender prior to the date of any A Borrowing that such Lender will not
make available to the Administrative Agent such Lender's ratable portion of such
A Borrowing, the Administrative Agent may assume that such Lender has made such
portion available to the Administrative Agent on the date of such A Borrowing in
accordance with subsection (a) of this Section 2.02 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 so made such ratable portion available to the Administrative Agent, such
Lender and the Borrower 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 A Advances
comprising such A Borrowing and (ii) in the case of such Lender, the Federal
Funds Rate. If such Lender shall repay to the Administrative Agent such
corresponding amount, such amount so repaid shall constitute such Lender's A
Advance as part of such A Borrowing for purposes of this Agreement (and such A
Advance shall be deemed to have been made by such Lender on the date on which
such amount is so repaid to the Administrative Agent).
(e) The failure of any Lender to make the A Advance to be made
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by it as part of any A Borrowing shall not relieve any other Lender of its
obligation, if any, hereunder to make its A Advance on the date of such A
Borrowing, but no Lender shall be responsible for the failure of any other
Lender to make the A Advance to be made by such other Lender on the date of any
A Borrowing.
SECTION 2.03. The B Advances.
(a) Each Lender severally agrees that the Borrower may request
B Borrowings under this Section 2.03 from time to time on any Business Day
during the period from the date hereof until the date occurring 30 days prior to
the Termination Date in the manner set forth below; provided that, following the
making of each B Borrowing, the aggregate amount of the Advances then
outstanding shall not exceed the aggregate amount of the Commitments of the
Lenders (computed without regard to any B Reduction). The following procedures
shall apply:
(i) The Borrower may request a B Borrowing under this Section
2.03 by delivering to the Administrative Agent, by telecopier, telex or
cable, a notice of a B Borrowing (a "Notice of B Borrowing"), in
substantially the form of Exhibit B-2 hereto, specifying the date and
aggregate amount of the proposed B Borrowing, the maturity date for
repayment of each B Advance to be made as part of such B Borrowing
(which maturity date may not be earlier than the date occurring 30 days
after the date of such B Borrowing or later than the Termination Date),
the interest payment date or dates relating thereto, and any other
terms to be applicable to such B Borrowing, not later than 10:00 A.M.
(New York City time):
(A) at least one Business Day prior to the date of
the proposed B Borrowing, if the Borrower shall specify in the
Notice of B Borrowing that the rates of interest to be offered
by the Lenders shall be fixed rates per annum (such Borrowing,
a "Fixed Rate B Borrowing") and
(B) at least four Business Days prior to the date of
the proposed B Borrowing, if the Borrower shall instead
specify in the Notice of B Borrowing the basis to be used by
the Lenders in determining the rates of interest to be offered
by them (such Borrowing, a "Specified Basis B Borrowing").
Simultaneously with each such request, the Borrower shall pay to the
Administrative Agent, for the Administrative Agent's account, a
non-refundable fee in the amount heretofore agreed between the Borrower
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and the Administrative Agent. Promptly following the Administrative
Agent's receipt of such request and the fee referred to in the
preceding sentence, the Administrative Agent shall notify each Lender
of such request for a B Borrowing received by it from the Borrower by
sending such Lender a copy of the related Notice of B Borrowing.
(ii) Each Lender may, if, in its sole discretion, it elects to do
so, irrevocably offer to make one or more B Advances to the Borrower as
part of such proposed B Borrowing at a rate or rates of interest
specified by such Lender in its sole discretion, by notifying the
Administrative Agent (which shall give prompt notice thereof to the
Borrower), before 10:00 A.M. (New York City time) (A) on the date of
such proposed B Borrowing (in the case of a Fixed Rate B Borrowing) and
(B) three Business Days before the date of such proposed B Borrowing
(in the case of a Specified Basis B Borrowing), of the minimum amount
and maximum amount of each B Advance which such Lender would be willing
to make as part of such proposed B Borrowing (which amounts may,
subject to the proviso to the first sentence of this Section 2.03(a),
exceed such Lender's Commitment, if any), the rate or rates of interest
therefor and such Lender's Applicable Lending Office with respect to
such B Advance; provided that if the Administrative Agent in its
capacity as a Lender shall, in its sole discretion, elect to make any
such offer, it shall notify the Borrower of such offer before 9:30 A.M.
(New York City time) on the date on which notice of such election is to
be given to the Administrative Agent by the other Lenders. If any
Lender shall elect not to make such an offer, such Lender shall so
notify the Administrative Agent, before 10:00 A.M. (New York City time)
on the date on which notice of such election is to be given to the
Administrative Agent by the other Lenders, and such Lender shall not be
obligated to, and shall not, make any B Advance as part of such B
Borrowing; provided that the failure by any Lender to give such notice
shall not cause such Lender to be obligated to make any B Advance as
part of such proposed B Borrowing.
(iii) The Borrower shall, in turn, (A) before 11:00 A.M. (New York
City time) on the date of such proposed B Borrowing (in the case of a
Fixed Rate B Borrowing) and (B) before 1:00 P.M. (New York City time)
three Business Days before the date of such proposed B Borrowing (in
the case of a Specified Basis B Borrowing), either:
(x) cancel such B Borrowing by giving the
Administrative Agent notice to that effect, or
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(y) in its sole discretion, (1) accept one or more of
the offers made by any Lender or Lenders pursuant to paragraph
(ii) above by giving notice to the Administrative Agent of the
amount of each B Advance to be made by each Lender as part of
such B Borrowing (provided that (I) the amount of each such B
Advance shall be equal to or greater than the minimum amount,
and equal to or less than the maximum amount, notified to the
Borrower by the Administrative Agent on behalf of such Lender
for such B Advance pursuant to paragraph (ii) above and (II)
such offers, if accepted, must be accepted in ascending order
of the rates of interest specified by the offering Lenders in
their respective notices delivered pursuant to paragraph (ii)
above (in each case beginning with the lowest rate so offered)
and, if offers are made by two or more Lenders with the same
rates of interest for a greater aggregate principal amount
than the amount in respect of which offers are accepted, then
the principal amount of B Advances in respect of which such
offers are accepted shall be allocated by the Borrower among
such Lenders as nearly as possible (in integral multiples of
$1,000,000) in proportion to the aggregate maximum principal
amount of such offers by such Lenders), and (2) reject any
remaining offers made by Lenders pursuant to paragraph (ii)
above by giving the Administrative Agent notice to that
effect.
(iv) If the Borrower notifies the Administrative Agent that such B
Borrowing is canceled pursuant to paragraph (iii)(x) above, the
Administrative Agent shall give prompt notice thereof to the Lenders
and such B Borrowing shall not be made.
(v) If the Borrower accepts one or more of the offers made by any
Lender or Lenders pursuant to paragraph (iii)(y) above, the
Administrative Agent shall in turn promptly notify (A) each Lender that
has made an offer as described in paragraph (ii) above, of the date and
aggregate amount of such B Borrowing and whether or not any offer or
offers made by such Lender pursuant to paragraph (ii) above have been
accepted by the Borrower, (B) each Lender that is to make a B Advance
as part of such B Borrowing, of the amount of each B Advance to be made
by such Lender as part of such B Borrowing, and (C) each Lender that is
to make a B Advance as part of such B Borrowing, upon receipt, that the
Administrative Agent has received forms of documents appearing to
fulfill the applicable conditions set forth in Article III. Each Lender
that is to make a B Advance as part of such B Borrowing shall, before
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12:00 noon (New York City time) on the date of such B Borrowing
specified in the notice received from the Administrative Agent pursuant
to clause (A) of the preceding sentence or any later time when such
Lender shall have received notice from the Administrative Agent
pursuant to clause (C) of the preceding sentence, make available for
the account of its Applicable Lending Office to the Administrative
Agent at its address referred to in Section 9.02 such Lender's portion
of such B Borrowing, in same day funds. Upon fulfillment of the
applicable conditions set forth in Article III and after receipt by the
Administrative Agent of such funds, the Administrative Agent will make
such funds available to the Borrower at the Administrative Agent's
aforesaid address. Promptly after each B Borrowing the Administrative
Agent will notify each Lender of the amount of the B Borrowing, the
consequent B Reduction and the dates upon which such B Reduction
commenced and will terminate.
(b) On or before the date of (but prior to) such B Borrowing
(in the case of a Specified Basis B Borrowing) or as promptly as practicable
after the date of such B Borrowing (in the case of a Fixed Rate B Borrowing),
the Borrower shall execute and deliver to the Administrative Agent a B Note
payable to the order of each Lender participating in such Borrowing for each of
the B Advances to be made by such Lender as part of such B Borrowing, in a
principal amount equal to the principal amount of the B Advance to be evidenced
thereby and otherwise on such terms as were agreed to for such B Advance in
accordance with this Section 2.03. The indebtedness of the Borrower resulting
from each B Advance made to the Borrower as part of a B Borrowing shall be
evidenced by a separate B Note of the Borrower payable to the order of the
Lender making such B Advance.
(c) Each B Borrowing shall be in an aggregate amount not less
than $10,000,000 or an integral multiple of $1,000,000 in excess thereof, but no
B Borrowing shall be made if, following the making of such B Borrowing, the
Borrower would not be in compliance with the limitation set forth in the proviso
to the first sentence of subsection (a) above.
(d) Within the limits and on the conditions set forth in this
Section 2.03, the Borrower may from time to time borrow under this Section 2.03,
repay pursuant to subsection (e) below, and reborrow under this Section 2.03.
(e) The Borrower shall repay to the Administrative Agent for
the account of each Lender which has made a B Advance, or each other holder of a
B Note, on the maturity date of each B Advance (such maturity date being that
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specified by the Borrower for repayment of such B Advance in the related Notice
of B Borrowing delivered pursuant to subsection (a)(i) above and provided in the
B Note evidencing such B Advance), the then unpaid principal amount of such B
Advance. The Borrower shall have no right to prepay any principal amount of any
B Advance.
(f) The Borrower shall pay interest on the unpaid principal
amount of each B Advance from the date of such B Advance to the date the
principal amount of such B Advance is repaid in full, at the rate of interest
for such B Advance specified by the Lender making such B Advance in its notice
with respect thereto delivered pursuant to subsection (a)(ii) above, payable on
the interest payment date or dates specified by the Borrower for such B Advance
in the related Notice of B Borrowing delivered pursuant to subsection (a)(i)
above, as provided in the B Note evidencing such B Advance.
SECTION 2.04. Certain Fees.
(a) Facility Fee. The Borrower agrees to pay to the
Administrative Agent for the account of each Lender (other than the Designated
Bidders) a facility fee (the "Facility Fee") on the average daily amount
(whether used or unused) of such Lender's Commitment from the date on which the
Borrower signs this Agreement (in the case of each Bank) and from the effective
date specified in the Assignment and Acceptance pursuant to which it became a
Lender (in the case of each such Lender) until the Termination Date at a rate
per annum equal to the Applicable Facility Fee Rate as in effect from time to
time. Accrued Facility Fee shall be paid on the last Business Day of each March,
June, September and December and on the Termination Date.
(b) Administrative Agent's Fee. The Borrower acknowledges its
agreement to pay to the Administrative Agent, for the Administrative Agent's own
account, administrative fees (the "Administrative Fees") at the times and in the
amounts heretofore agreed between the Borrower and the Administrative Agent.
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SECTION 2.05. Changes in and Extensions of the Commitments.
(a) Commitment Reductions. The Borrower shall have the right,
upon at least three Business Days' notice to the Administrative Agent, to
terminate in whole or reduce ratably in part the unused portions of the
respective Commitments of the Lenders, provided that the aggregate amount of the
Commitments of the Lenders shall not be reduced to an amount which is less than
the aggregate principal amount of the Advances then outstanding, and provided
further that each partial reduction shall be in an aggregate amount of
$10,000,000 or an integral multiple of $1,000,000 in excess thereof.
(b) The Borrower shall have the right from time to time,
without the consent of the Lenders, to effect an increase in the aggregate
Commitments hereunder by adding as parties to this Agreement one or more other
banks satisfactory to the Administrative Agent (each such added bank being
herein called an "Additional Lender") and/or by allowing one or more Lenders to
increase their Commitments hereunder (so that such added and increased
Commitments shall in the aggregate equal the aggregate amount of the increase in
Commitments effected pursuant hereto). Notwithstanding the foregoing, no
increase in the aggregate Commitments hereunder pursuant to this paragraph (b)
shall be effective unless:
(i) each Additional Lender shall have entered into an
agreement in form and substance satisfactory to the Borrower and the
Administrative Agent pursuant to which such Additional Lender
undertakes a Commitment and, upon the effectiveness of such agreement
(the date of the effectiveness of any such agreement being hereinafter
referred to as the "Increased Commitment Date"), such Additional Lender
shall be a "Lender" for all purposes of this Agreement;
(ii) the Borrower shall have given the Administrative
Agent notice of such increase at least five Business Days prior to the
relevant Increased Commitment Date;
(iii) any increase in the Commitments hereunder, and
any Commitment of an Additional Lender, shall be in a minimum amount of
$25,000,000 or an integral multiple of $25,000,000 in excess thereof;
(iv) no increase in the Commitments hereunder shall
result in the aggregate amount of the Commitments exceeding
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$400,000,000;
(v) no Lender's Commitment shall be increased without
the prior express written consent of such Lender;
(vi) on such Increased Commitment Date, either (i) no
A Advances shall be outstanding hereunder and no Notice of A Borrowing
shall be pending or (ii) any outstanding A Advances shall be converted
to B Advances and no notice of borrowing of A Advances shall be
pending;
(vii) no Event of Default shall have occurred and be
continuing on and as of the date of the notice referred to in clause
(ii) above or on such Increased Commitment Date;
(viii) no Lender may increase its Commitment
hereunder unless all of the Lenders shall have been given the same
opportunity to increase their Commitments, and the aggregate amount of
the increase offered to all of the Lenders shall be allocated among
them pro rata according to the respective increases that they have
agreed to accept; and
(ix) there shall not have occurred any ratable
reduction of the Commitments pursuant to Section 2.05(a) hereof on or
prior to such Increased Commitment Date.
(c) Commitment Extensions. The Borrower may, by notice to the
Administrative Agent (which shall promptly notify the Lenders) not less than 60
days and not more than 180 days prior to each anniversary of the Effective Date,
request that the Lenders (other than the Designated Bidders) extend the
Commitment Termination Date for an additional one-year period from the
Commitment Termination Date then in effect hereunder (the "Existing Commitment
Termination Date"). Each such Lender, acting in its sole discretion, shall, by
notice to the Borrower and the Administrative Agent given no later than the date
(herein, the "Consent Date") that is 20 days after the date of such extension
request (or, if such date is not a Business Day, the next succeeding Business
Day), advise the Borrower and the Administrative Agent whether or not such
Lender agrees to such extension; provided that each Lender that determines not
to extend the Commitment Termination Date (a "Non-Extending Lender") shall
notify the Administrative Agent (which shall notify the Lenders) of such fact
promptly after such determination (but in any event no later than the Consent
Date) and any Lender that does not advise the Borrower on or before the Consent
Date shall be deemed to be a Non-Extending Lender. The election of any Lender to
agree to such extension shall not obligate any other Lender to so agree. If and
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only if each of the Lenders has advised the Borrower and the Administrative
Agent of its agreement to extend the Commitment Termination Date as aforesaid on
or prior to the Consent Date, then the Commitment Termination Date shall be
extended automatically, without any other action by any person, to the date that
is one year after the Existing Commitment Termination Date. The Administrative
Agent will promptly notify the Borrower and the Lenders of each extension of the
Commitment Termination Date pursuant to this Section 2.05(b).
SECTION 2.06. Repayment of A Advances. The Borrower hereby
promises to pay to the Administrative Agent for account of each Lender the
entire outstanding principal amount of such Lender's A Advances, and each A
Advance shall mature, on the Termination Date.
SECTION 2.07. Interest.
(a) Ordinary Interest. The Borrower shall pay interest on the
unpaid principal amount of each A Advance made by each Lender, from the date of
such A Advance until such principal amount shall be paid in full, at the
following rates per annum:
(i) Base Rate Advances. If such A Advance is a Base Rate
Advance, a rate per annum equal to the Base Rate in effect from time to
time, payable quarterly in arrears on the last Business Day of each
March, June, September and December and on the date such Base Rate
Advance shall be Converted or paid in full.
(ii) Eurodollar Rate Advances. If such A Advance is a Eurodollar
Rate Advance, a rate per annum for each Interest Period for such A
Advance equal to the sum of the Eurodollar Rate for such Interest
Period plus the Applicable Margin for Eurodollar Rate Advances as in
effect from time to time, payable on the last day of such Interest
Period and, if such Interest Period has a duration of more than three
months, on the day which occurs three months after the first day of
such Interest Period, and on the date such Eurodollar Rate Advance
shall be Continued, Converted or paid in full.
(b) Default Interest. The Borrower shall pay interest on the
unpaid principal amount of each A Advance and B Advance that is not paid when
due (whether at stated maturity, by acceleration or otherwise), and on the
unpaid amount of any interest, fee or other amount payable hereunder that is not
paid when due, payable on demand, at a rate per annum during the period from the
due date thereof to the date on which such amount is paid in full equal to:
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(i) in the case of any amount of principal of such Advance:
(x) in the case of any Base Rate Advance, 2% plus the
rate which would otherwise be applicable to such Advance, and
(y) in the case of any Eurodollar Rate Advance, for
the balance of the then current Interest Period, 2% plus the
rate which would otherwise be applicable to such Advance for
such Interest Period and, thereafter, 2% plus the Base Rate as
in effect from time to time, and
(ii) in the case of all other amounts, 2% plus the Base Rate
as in effect from time to time.
----
SECTION 2.08. Additional Interest on Eurodollar Rate Advances.
The Borrower shall pay to each Lender, so long as such Lender shall be required
under regulations of the Board to maintain reserves with respect to liabilities
or assets consisting of or including Eurocurrency Liabilities (or the
equivalent), additional interest on the unpaid principal amount of each
Eurodollar Rate Advance of such Lender, from the date of such Eurodollar Rate
Advance until such principal amount is paid in full, at an interest rate per
annum equal at all times to the remainder obtained by subtracting (i) the
Eurodollar Rate for the then-current Interest Period for such Eurodollar Rate
Advance from (ii) the rate obtained by dividing such Eurodollar Rate by a
percentage equal to 100% minus the Eurodollar Rate Reserve Percentage of such
Lender for such Interest Period, payable on each date on which interest is
payable on such Eurodollar Rate Advance. Any Lender wishing to require payment
of such additional interest shall so notify the Borrower and the Administrative
Agent and shall furnish to the Borrower at least five Business Days prior to
each date on which interest is payable on the Eurodollar Rate Advances of such
Lender a certificate (which certificate shall be conclusive and binding for all
purposes, absent manifest error) setting forth the basis for such assertion and
the amount to which such Lender is then entitled under this Section (which shall
be consistent with such Lender's good faith estimate of the level at which the
related reserves are being maintained by it).
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SECTION 2.09. Interest Rate Determinations; Changes in Rating
Systems.
(a) If the second sentence of the definition of "Eurodollar
Rate" in Section 1.01 is applicable, each Reference Bank agrees to furnish to
the Administrative Agent timely information for the purpose of determining each
Eurodollar Rate. If any one or more of the Reference Banks shall not furnish
such timely information to the Administrative Agent for the purpose of
determining any such interest rate, the Administrative Agent shall determine
such interest rate on the basis of timely information furnished by the remaining
Reference Banks (subject to clause (c) below).
(b) The Administrative Agent shall give prompt notice to the
Borrower and the Lenders of the applicable interest rate determined by the
Administrative Agent for the purpose of Section 2.07 and the applicable rate, if
any, furnished by each Reference Bank for the purpose of determining the
applicable interest rate under Section 2.07(a)(ii).
(c) If the second sentence of the definition of "Eurodollar
Rate" in Section 1.01 is applicable and fewer than two Reference Banks furnish
timely information to the Administrative Agent for determining the Eurodollar
Rate for any Interest Period for any Eurodollar Rate Advances,
(i) the Administrative Agent shall forthwith notify the
Borrower and the Lenders that the interest rate cannot be determined
for such Eurodollar Rate Advances for such Interest Period,
(ii) each Eurodollar Rate Advance will automatically, on the last
day of the then existing Interest Period therefor, Convert into a Base
Rate Advance, and
(iii) the obligation of the Lenders to make or Continue, or to
Convert A Advances into, Eurodollar Rate Advances shall be suspended
until the Administrative Agent shall notify the Borrower and the
Lenders that the circumstances causing such suspension no longer exist.
(d) If, with respect to any Eurodollar Rate Advances, the
Majority Lenders notify the Administrative Agent that the Eurodollar Rate for
any Interest Period for such Advances will not adequately reflect the cost to
such Majority Lenders of making, funding or maintaining their respective
Eurodollar Rate Advances for such Interest Period, the Administrative Agent
shall forthwith so notify the Borrower and the Lenders, whereupon
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(i) each Eurodollar Rate Advance will automatically, on the
last day of the then existing Interest Period therefor, Convert into a
Base Rate Advance, and
(ii) the obligation of the Lenders to make or Continue, or to
Convert A Advances into, Eurodollar Rate Advances shall be suspended
until the Administrative Agent shall notify the Borrower and such
Lenders that the circumstances causing such suspension no longer exist.
(e) If the Borrower shall fail to select the duration of any
Interest Period for any Eurodollar Rate Advances in accordance with the
provisions contained in the definition of "Interest Period" in Section 1.01, the
Administrative Agent will forthwith so notify the Borrower and the Lenders and
such Advances will automatically, on the last day of the then existing Interest
Period therefor, Convert into Base Rate Advances.
(f) On the date on which the aggregate unpaid principal amount
of Eurodollar Rate Advances comprising any A Borrowing shall be reduced, by
prepayment or otherwise, to less than $5,000,000, such A Advances shall
automatically Convert into Base Rate Advances.
(g) Upon the occurrence and during the continuance of any
Event of Default and upon notice from the Administrative Agent to the Borrower
at the request of the Majority Lenders, (x) each Eurodollar Rate Advance will
automatically, on the last day of the then existing Interest Period therefor,
Convert into a Base Rate Advance and (y) the obligation of the Lenders to make
or Continue, or to Convert Advances into, Eurodollar Rate Advances shall be
suspended.
(h) If the rating system of either Moody's or S&P shall
change, or if either such rating agency shall cease to be in the business of
rating corporate debt obligations, the Borrower and the Administrative Agent (on
behalf of the Lenders) shall negotiate in good faith to amend the references to
specific ratings in this Agreement to reflect such changed rating system or the
non-availability of ratings from such rating agency (provided that any such
amendment to such specific ratings shall in no event be effective without the
approval of the Majority Lenders).
SECTION 2.10. Voluntary Conversion and Continuation of A
Advances.
(a) Optional Conversion. The Borrower may on any Business Day,
upon notice given to the Administrative Agent not later than 11:00 A.M. (New
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York City time) on the third Business Day prior to the date of the proposed
Conversion and subject to the provisions of Sections 2.09 and 2.13, Convert all
or any portion of the outstanding A Advances of one Type comprising part of the
same A Borrowing into A Advances of the other Type; provided that (i) any
Conversion of Base Rate Advances into Eurodollar Rate Advances shall be in an
amount not less than the minimum amount specified in Section 2.02(b) and (ii) in
the case of any such Conversion of a Eurodollar Rate Advance into a Base Rate
Advance on a day other than the last day of an Interest Period therefor, the
Borrower shall reimburse the Lenders in respect thereof pursuant to Section
9.04(c). Each such notice of a Conversion shall, within the restrictions
specified above, specify (x) the date of such Conversion, (y) the A Advances to
be Converted, and (z) if such Conversion is into Eurodollar Rate Advances, the
duration of the initial Interest Period for each such A Advance. Each notice of
Conversion shall be irrevocable and binding on the Borrower.
(b) Continuations. The Borrower may, on any Business Day, upon
notice given to the Administrative Agent not later than 11:00 A.M. (New York
City time) on the third Business Day prior to the date of the proposed
Continuation and subject to the provisions of Sections 2.09 and 2.13, Continue
all or any portion of the outstanding Eurodollar Rate Advances comprising part
of the same A Borrowing for one or more Interest Periods; provided that (i)
Eurodollar Rate Advances so Continued and having the same Interest Period shall
be in an amount not less than the minimum amount specified in Section 2.02(b)
and (ii) in the case of any such Continuation on a day other than the last day
of an Interest Period therefor, the Borrower shall reimburse the Lenders in
respect thereof pursuant to Section 9.04(c). Each such notice of a Continuation
shall, within the restrictions specified above, specify (x) the date of such
Continuation, (y) the Eurodollar Rate Advances to be Continued and (y) the
duration of the initial Interest Period (or Interest Periods) for the Eurodollar
Rate Advances subject to such Continuation. Each notice of Continuation shall be
irrevocable and binding on the Borrower.
SECTION 2.11. Prepayments of A Advances.
(a) The Borrower shall have no right to prepay any principal
amount of any A Advances other than as provided in subsection (b) below.
(b) The Borrower may, upon at least one Business Day's notice
to the Administrative Agent stating the proposed date and aggregate principal
amount of the prepayment, and if such notice is given the Borrower shall, prepay
the outstanding principal amounts of the Advances comprising part of the same A
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Borrowing in whole or ratably in part, together with accrued interest to the
date of such prepayment on the principal amount prepaid; provided, however, that
(x) each partial prepayment shall be in an aggregate principal amount not less
than $10,000,000 or integral multiples of $1,000,000 in excess thereof and (y)
in the case of any such prepayment of a Eurodollar Rate Advance on a day other
than the last day of an Interest Period therefor, the Borrower shall reimburse
the Lenders in respect thereof pursuant to Section 9.04(c).
SECTION 2.12. Increased Costs.
(a) If, due to either (i) the introduction of or any change
(other than any change by way of imposition or increase of reserve requirements
included in the Eurodollar Rate Reserve Percentage) in or in the interpretation
of (to the extent any such introduction or change occurs after the date hereof)
any law or regulation or (ii) the compliance with any guideline or request of
any central bank or other governmental authority adopted or made after the date
hereof (whether or not having the force of law), there shall be any increase in
the cost to any Lender of agreeing to make or making, funding or maintaining
Eurodollar Rate Advances, the Borrower shall from time to time, within 30 days
after delivery by such Lender to the Borrower (with a copy to the Administrative
Agent) of a certificate as to the amount of (and specifying in reasonable detail
the basis for) such increased cost, pay (subject to Section 2.12(c)) to the
Administrative Agent for the account of such Lender the amount of the increased
costs set forth in such certificate (which certificate shall be conclusive and
binding for all purposes, absent manifest error); provided that, before making
any such demand, each Lender agrees to use reasonable efforts (consistent with
its internal policy and legal and regulatory restrictions) to designate a
different Applicable Lending Office if the making of such a designation would
avoid the need for, or reduce the amount of, such increased cost and would not,
in the reasonable judgment of such Lender, be otherwise disadvantageous to such
Lender.
(b) If any Lender (other than a Designated Bidder) determines
that compliance with any law or regulation enacted or introduced after the date
hereof or any guideline or request of any central bank or other governmental
authority adopted or made after the date hereof (whether or not having the force
of law) affects or would affect the amount of capital required or expected to be
maintained by such Lender or any corporation controlling such Lender and that
the amount of such capital is increased by or based upon the existence of such
Lender's commitment to lend hereunder and other commitments of this type, then,
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within 30 days after delivery by such Lender to the Borrower (with a copy to the
Administrative Agent) of a certificate as to (and specifying in reasonable
detail the basis for) the Additional Amounts (as hereinafter defined) requested
by such Lender, the Borrower shall pay (subject to Section 2.12(c)) to the
Administrative Agent for the account of such Lender, from time to time as
specified by such Lender, the amount specified in such certificate (which
certificate shall be conclusive and binding for all purposes, absent manifest
error). For purposes hereof, the "Additional Amounts" that may be requested by
any Lender under this Section 2.12(b) means such amounts as such Lender shall
reasonably determine to be sufficient to compensate such Lender or any
corporation controlling such Lender for any costs that such Lender reasonably
determines are attributable to the maintenance by such Lender (or such
corporation) of capital in respect of its commitments to lend hereunder (such
compensation to include, without limitation, an amount equal to any reduction of
the rate of return on assets or equity of such Lender (or such corporation) to a
level below that which such Lender (or such corporation) could have achieved but
for the enactment or introduction of such law or regulation or the adoption or
making of such guideline or request).
(c) The Borrower shall not be obligated to pay any additional
amounts arising pursuant to clauses (a) and (b) of this Section 2.12 that are
attributable to the Excluded Period with respect to such additional amount;
provided, that if an applicable law, rule, regulation, guideline or request
shall be adopted or made on any date and shall be applicable to the period (a
"Retroactive Period") prior to the date on which such law, rule, regulation,
guideline or request is adopted or made, the limitation on the Borrower's
obligations to pay such additional amounts hereunder shall not apply to the
additional amounts payable in respect of such Retroactive Period.
SECTION 2.13. Illegality.
(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 Rate Advance or to give effect to its obligations as contemplated
hereby with respect to any Eurodollar Rate Advance, then, by written notice to
the Borrower and to the Administrative Agent, such Lender may:
(i) declare that Eurodollar Rate Advances will not thereafter
be made by such Lender hereunder, whereupon any request by the
Borrower for a Eurodollar Rate Advance shall, as to such Lender
only, be deemed a request for a Base Rate Advance (or for a
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Conversion thereto pursuant to Section 2.10(a)) unless such
declaration shall be subsequently withdrawn; and
(ii) require that all outstanding Eurodollar Rate Advances
made by it be Converted to Base Rate Loans, in which event all
such Eurodollar Rate Advances shall be automatically Converted to
Base Rate Loans as of the effective date of such notice as
provided in paragraph (b) below.
In the event any Lender shall exercise its rights under (i) or (ii) above, all
payments and prepayments of principal which would otherwise have been applied to
repay the Eurodollar Rate Advances that would have been made by such Lender or
the Converted Eurodollar Rate Advances of such Lender shall instead be applied
to repay the Base Rate Loans made by such Lender in lieu of, or resulting from
the Conversion of, such Eurodollar Rate Advances.
(b) For purposes of this Section 2.13, a notice to the Borrower by
any Lender shall be effective as to each Eurodollar Rate Advance, if lawful on
the last day of the Interest Period currently applicable to such Eurodollar Rate
Advance; in all other cases such notice shall be effective on the date of
receipt by the Borrower.
SECTION 2.14. Payments and Computations.
(a) The Borrower shall make each payment hereunder and under the
Notes without set-off or counterclaim not later than 11:00 A.M. (New York City
time) on the day when due in U.S. dollars to the Administrative Agent at its
address referred to in Section 9.02 in same day funds. The Administrative Agent
will promptly thereafter cause to be distributed like funds relating to the
payment of principal, interest or Facility Fees ratably (other than amounts
payable pursuant to Section 2.03, 2.08, 2.12 or 2.15) to the Lenders for the
account of their respective Applicable Lending Offices, and like funds relating
to the payment of any other amount payable to any Lender to such Lender for the
account of its Applicable Lending Office, in each case to be applied in
accordance with the terms of this Agreement. Upon its acceptance of an
Assignment and Acceptance and recording of the information contained therein in
the Register pursuant to Section 9.07(c), from and after the effective date
specified in such Assignment and Acceptance, the Administrative Agent shall make
all payments hereunder and under the Notes in respect of the interest assigned
thereby to the Lender assignee thereunder, and the parties to such Assignment
and Acceptance shall make all appropriate adjustments in such payments for
periods prior to such effective date directly between themselves.
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(b) All computations of interest based on Citibank's base rate and
of Facility Fees shall be made by the Administrative Agent on the basis of a
year of 365 or 366 days, as the case may be, and all computations of interest
based on the Eurodollar Rate or the Federal Funds Rate shall be made by the
Administrative Agent, and all computations of interest pursuant to Section 2.08
shall be made by a Lender, on the basis of a year of 360 days, in each case for
the actual number of days (including the first day but excluding the last day)
occurring in the period for which such interest or Facility Fees are payable.
Each determination by the Administrative Agent of an interest rate hereunder
shall be conclusive and binding for all purposes, absent manifest error.
(c) Whenever any payment hereunder or under the Notes would be due
on a day other than a Business Day, such due date shall be extended to the next
succeeding Business Day, and any such extension of such due date shall in such
case be included in the computation of payment of interest or Facility Fee, as
the case may be; provided, however, if such extension would cause payment of
interest on or principal of Eurodollar Rate Advances to be made in the next
following calendar month, such payment shall be made on the next preceding
Business Day.
(d) Unless the Administrative Agent shall have received notice
from the Borrower prior to the date on which any payment is due to the Lenders
hereunder that the Borrower will not make such payment in full, the
Administrative Agent may assume that the Borrower has made such payment in full
to the Administrative Agent on such date and the Administrative Agent may, in
reliance upon such assumption, cause to be distributed to each Lender on such
due date an amount equal to the amount then due such Lender. If and to the
extent that the Borrower shall not have so made such payment in full to the
Administrative Agent, each Lender shall repay to the Administrative Agent
forthwith on demand such amount distributed to such Lender together with
interest thereon, for each day from the date such amount is distributed to such
Lender until the date such Lender repays such amount to the Administrative
Agent, at the Federal Funds Rate.
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SECTION 2.15. Taxes.
(a) Any and all payments by the Borrower hereunder or under the
Notes shall be made, in accordance with Section 2.14, free and clear of and
without deduction for any and all present or future taxes, levies, imposts,
deductions, charges or withholdings, and all liabilities with respect thereto,
excluding, in the case of each Lender and the Administrative Agent, taxes
imposed on its income, and franchise taxes imposed on it, by the jurisdiction
under the laws of which such Lender or the Administrative Agent (as the case may
be) is organized or any political subdivision thereof and, in the case of each
Lender, taxes imposed on its income, and franchise taxes imposed on it, by the
jurisdiction of such Lender's Applicable Lending Office or any political
subdivision thereof (all such non-excluded taxes, levies, imposts, deductions,
charges, withholdings and liabilities being hereinafter referred to as "Taxes").
If the Borrower shall be required by law to deduct any Taxes from or in respect
of any sum payable hereunder or under any Note to any Lender or the
Administrative Agent, (i) the sum payable shall be increased as may be necessary
so that after making all required deductions (including deductions applicable to
additional sums payable under this Section 2.15) such Lender or the
Administrative Agent (as the case may be) receives 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 taxation authority or other authority in accordance with
applicable law. Each Lender represents and warrants that no Taxes will be
incurred on the date hereof in connection with the execution and delivery of the
Loan Documents.
(b) In addition, the Borrower agrees to pay any present or future
stamp or documentary taxes or any other excise or property taxes, charges or
similar levies which arise from any payment made hereunder or under the Notes or
from the execution, delivery or registration of, or otherwise with respect to,
this Agreement or the Notes (hereinafter referred to as "Other Taxes"). Each
Lender represents and warrants that no Other Taxes will be incurred on the date
hereof in connection with the execution and delivery of the Loan Documents.
(c) The Borrower will indemnify each Lender and the Administrative
Agent for the full amount of Taxes or Other Taxes (including, without
limitation, any Taxes and Other Taxes imposed by any jurisdiction on amounts
payable under this Section 2.15) paid by such Lender or the Administrative Agent
(as the case may be) and any liability (including penalties, interest and
expenses) arising therefrom or with respect thereto, whether or not such Taxes
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or Other Taxes were correctly or legally asserted. Such Lender will use
reasonable efforts to contest such a Tax or Other Tax that is, in its opinion,
incorrectly asserted. This indemnification shall be made within 30 days from the
date such Lender or the Administrative Agent (as the case may be) makes written
demand therefor.
(d) Within 30 days after the date of any payment of Taxes, the
Borrower will furnish to the Administrative Agent, at its address referred to in
Section 9.02, the original or a certified copy of a receipt evidencing payment
thereof.
(e) Each Lender organized under the laws of a jurisdiction outside
the United States, on or prior to the date of its execution and delivery of this
Agreement (in the case of each Bank) and on the date of the Assignment and
Acceptance pursuant to which it becomes a Lender (in the case of each other
Lender), and from time to time thereafter if requested in writing by the
Borrower or the Administrative Agent (but only so long as such Lender remains
lawfully able to do so), shall provide the Borrower and the Administrative Agent
with Internal Revenue Service form 1001 or 4224, as appropriate, or any
successor form prescribed by the Internal Revenue Service, certifying that such
Lender is entitled to benefits under an income tax treaty to which the United
States is a party which reduces the rate of withholding tax on payments of
interest or certifying that the income receivable pursuant to this Agreement is
effectively connected with the conduct of a trade or business in the United
States. If the form provided by a Lender at the time such Lender first becomes a
party to this Agreement indicates a United States interest withholding tax rate
in excess of zero, withholding tax at such rate shall be considered excluded
from "Taxes" as defined in Section 2.15(a).
(f) For any period with respect to which a Lender has failed to
provide the Borrower or the Administrative Agent with the appropriate form
described in Section 2.15(e) (other than if such failure is due to a change in
law occurring subsequent to the date on which a form originally was required to
be provided, or if such form otherwise is not required under the first sentence
of subsection (e) above), such Lender shall not be entitled to indemnification
under Section 2.15(a) with respect to Taxes imposed by the United States;
provided, however, that should a Lender become subject to Taxes because of its
failure to deliver a form required hereunder, the Borrower shall take such steps
as the Lender shall reasonably request to assist the Lender to recover such
Taxes.
(g) Any Lender claiming any additional amounts payable pursuant to
this Section 2.15 shall use reasonable efforts (consistent with its internal
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policy and legal and regulatory restrictions) to change the jurisdiction of its
Applicable Lending Office(s) if the making of such a change would avoid the need
for, or reduce the amount of, any such additional amounts that may thereafter
accrue and would not, in the reasonable judgment of such Lender, be otherwise
disadvantageous to such Lender.
(h) If a Lender or the Administrative Agent (as the case may be)
shall become aware that it is entitled to claim a Refund (as hereinafter
defined) from a taxing authority, such Lender or the Administrative Agent shall
promptly notify the Borrower of the availability of such Refund and shall,
within 30 days after receipt of a written request by the Borrower, make a claim
to such taxing authority for such Refund at the Borrower's expense if, in the
judgment of such Lender or the Administrative Agent (as the case may be), the
making such claim will not be otherwise disadvantageous to it; provided that
nothing in this Section 2.15(h) shall require any Lender or the Administrative
Agent to institute any administrative, judicial or other proceeding (other than
the filing of a claim for any such Refund) to obtain any such Refund. If a
Lender or the Administrative Agent (as the case may be) receives a Refund from a
taxing authority, it shall promptly pay to the Borrower the amount so received
(but only to the extent of indemnity payments made, or additional amounts paid,
by the Borrower under this Section 2.15 with respect to the Taxes or Other Taxes
giving rise to such Refund), net of all reasonable out-of-pocket expenses
(including the net amount of taxes, if any, imposed on such Lender or the
Administrative Agent with respect to such Refund) of such Lender or
Administrative Agent, and without interest (other than interest paid by the
relevant taxing authority with respect to such Refund); provided, however, that
the Borrower, upon the request of such Lender or the Administrative Agent, shall
repay the amount paid over to the Borrower (plus penalties, interest and other
charges) to such Lender or the Administrative Agent in the event such Lender or
the Administrative Agent is required to repay such Refund to such taxing
authority. Nothing contained in this Section 2.15 shall require any Lender or
the Administrative Agent to make available any of its tax returns (or any other
information that it deems to be confidential or proprietary). For purposes of
this Section 2.15(h), a "Refund" means a refund of Taxes or Other Taxes (other
than any such refund in the form of a tax credit) for which a Lender or the
Administrative Agent, as the case may be, has been indemnified by the Borrower
(or with respect to which the Borrower has paid additional amounts) pursuant to
this Section 2.15, provided that the entitlement to such refund arises solely
from a manifest error in the amount of such Taxes or Other Taxes so paid.
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SECTION 2.16. Sharing of Payments, Etc. If any Lender shall
obtain any payment (whether voluntary, involuntary, through the exercise of
any right of set-off, or otherwise) on account of the A Advances made by it
(other than pursuant to Section 2.08, 2.12 or 2.15) in excess of its ratable
share of payments on account of the A Advances obtained by all the Lenders,
such Lender shall forthwith purchase from the other Lenders such participations
in the A Advances made by them as shall be necessary to cause such purchasing
Lender to share the excess payment ratably with each of them, provided,
however, that if all or any portion of such excess payment is thereafter
recovered from such purchasing Lender, such purchase from each Lender shall
be rescinded and such Lender shall repay to the purchasing Lender the purchase
price to the extent of such recovery together with an amount equal to such
Lender's ratable share (according to the proportion of (i) the amount of
such Lender's required repayment to (ii) the total amount so recovered from the
purchasing Lender) of any interest or other amount paid or payable by the
purchasing Lender in respect of the total amount so recovered. The Borrower
agrees that any Lender so purchasing a participation from another Lender
pursuant to this Section 2.16 may, to the fullest extent permitted by law,
exercise all its rights of payment (including the right of set-off) with respect
to such participation as fully as if such Lender were the direct creditor of the
Borrower in the amount of such participation.
ARTICLE III
CONDITIONS OF LENDING
The obligations of the Lenders to make Advances hereunder are subject
to the satisfaction of the following conditions:
SECTION 3.01. All Borrowings. On the date of each Borrowing:`
(a) The Administrative Agent shall have received a notice of such
Borrowing as required by Section 2.02 or 2.03, as applicable;
(b) The representations and warranties set forth in Article IV
shall be true and correct in all material respects on and as of the
date of such Borrowing 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) The Borrower shall be in compliance with all of the terms and
provisions set forth herein and in each other Loan Document on its part
to be observed or performed, and at the time of, and immediately after
such Borrowing, no Event of Default or Default shall have occurred and
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be continuing; and
(d) Each Lender that shall not have previously received an
appropriate Note shall have received a duly executed B Note or A Note,
as applicable, payable to its order.
Each Borrowing shall be deemed to constitute a representation and warranty by
the Borrower on the date of such Borrowing as to the matters specified in
paragraphs (b) and (c) of this Section 3.01.
SECTION 3.02. First Borrowing. On the Closing Date:
(a) Each Lender shall have received a duly executed A Note;
(b) The Administrative Agent shall have received a favorable
written opinion of either the general counsel or the corporate
secretary (provided that such corporate secretary is an attorney
admitted to practice law, and is in good standing, in a jurisdiction
within the United States of America) of the Parent Guarantor, dated the
Closing Date and addressed to the Lenders, to the effect set forth in
Exhibit E hereto, and the Parent Guarantor hereby instructs such
counsel to deliver such opinion to the Administrative Agent;
(c) The Administrative Agent shall have received a favorable
written opinion of Milbank, Tweed, Hadley & McCloy, counsel to the
Administrative Agent, to the effect set forth in Exhibit F hereto;
(d) All legal matters incident to this Agreement and the
borrowings hereunder shall be satisfactory to the Administrative Agent
and the Lenders;
(e) The Administrative Agent shall have received (i) a copy of the
certificate or articles of incorporation, including all amendments
thereto, of each Obligor, certified as of a recent date by the
Secretary of State of the state of its organization, and a certificate
as to the good standing of each Obligor as of a recent date, from such
Secretary of State; (ii) a certificate of the Secretary or Assistant
Secretary of each Obligor dated the Closing Date and certifying (A)
that attached thereto is a true and complete copy of the by-laws of
such Obligor as in effect on the Closing Date and at all times since a
date prior to the date of the resolutions described in clause (B)
below, (B) that attached thereto is a true and complete copy of
resolutions duly adopted by the Board of Directors of such Obligor
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authorizing the execution, delivery and performance of the Loan
Documents to which it is a party and (in the case of the Borrower) the
borrowings hereunder, and that such resolutions have not been modified,
rescinded, or amended and are in full force and effect, (C) that the
certificate or articles of incorporation of such Obligor have not been
amended since the date of the last amendment thereto shown on the
certificate of good standing furnished pursuant to clause (i) above,
and (D) as to the incumbency and specimen signature of each officer
executing any Loan Document or any other document delivered in
connection herewith on behalf of such Obligor; (iii) a certificate of
another officer as to the incumbency and specimen signature of the
Secretary or Assistant Secretary executing the certificate pursuant to
(ii) above; and (iv) such other documents as the Administrative Agent
or the Lenders may reasonably request;
(f) The Administrative Agent shall have received a certificate,
dated the Closing Date and signed by a Financial Officer of the Parent
Guarantor, confirming compliance with the conditions precedent set
forth in paragraphs (b) and (c) of Section 3.01; and
(g) The Administrative Agent shall have received all Fees and
other amounts due and payable on or prior to the Closing Date.
ARTICLE IV
REPRESENTATIONS AND WARRANTIES
The Parent Guarantor represents and warrants to each of the Lenders
that:
SECTION 4.01. Organization; Powers; Governmental Approvals.
(a) The Parent Guarantor and each Principal Subsidiary (i) is a
corporation duly organized, validly existing and in good standing under the laws
of the jurisdiction of its organization, (ii) has all requisite power and
authority to own its property and assets and to carry on its business as now
conducted and (iii) is qualified to do business in every jurisdiction where such
qualification is required, except where the failure so to qualify would not
have a material adverse effect on the condition, financial condition or other-
wise, results of operations, business, assets, operations, or prospects of the
Parent Guarantor and its Subsidiaries taken as a whole. Each Obligor's
execution, delivery and performance of this Agreement are within its corporate
powers, have been duly authorized by all necessary action and do not violate
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or create a default underlaw, its constituent documents, or any contractual
provision binding upon it. This Agreement and (in the case of the Borrower) the
Notes constitute legal, valid and binding obligations of each Obligor
enforceable against it in accordance with their respective terms (except as
such enforceability may be limited by applicable bankruptcy, reorganization,
insolvency, moratorium and other laws affecting the rights of creditors
generally and general principles of equity).
(b) All Governmental Approvals (other than, until the Approval
Date, the FERC Approval and the VPSB Approval) have been duly obtained, are in
full force and effect without having been amended or modified in any manner that
may impair the ability of any Obligor to perform its obligations under this
Agreement or the Notes, and are not the subject of any pending or overtly
threatened appeal, stay or other challenge. No Interest Period requested with
respect to any Borrowing extends beyond the latest date permitted for Borrowings
by any Governmental Approval then in effect.
SECTION 4.02. Financial Statements. The Parent Guarantor has
furnished to the Lenders, for itself and its Principal Subsidiaries, their most
recent filings with the Securities and Exchange Commission on Forms 10-K and
10-Q. Such Forms 10-K and 10-Q, taken together with any subsequent filings by
the Parent Guarantor and its Principal Subsidiaries with the Securities and
Exchange Commission under the Securities Exchange Act of 1934, as amended,
furnished to each Lender prior to the date hereof, do not contain any untrue
statement of a material fact or omit to state a material fact necessary to make
any statement therein, in light of the circumstances under which it was made,
not misleading. Each of the financial statements in such Forms 10-K and 10-Q,
and each such subsequent filing, has been, and each of the financial statements
to be furnished pursuant to Section 5.02 will be, prepared in accordance with
GAAP applied consistently with prior periods, except as therein noted, and
fairly presents or will fairly present in all material respects the
consolidated financial position of the Parent Guarantor or Principal Sub-
sidiary, as the case may be, as of the date thereof and the results of the
operations of the Parent Guarantor and the Subsidiaries or Principal
Subsidiary, as the case may be, for the period then ended.
SECTION 4.03. No Material Adverse Change. From the date of
the Parent Guarantor's most recent financial statements contained in its
Annual Report on Form 10-K for the fiscal year ended December 31, 1996
furnished to the Lenders pursuant to Section 4.02 through the date of the
initial Borrowing, and except as described in the Parent Guarantor's Quarterly
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Reports on Form 10-Q for the quarterly periods ended March 31, 1997, June 30,
1997 and September 30, 1997 furnished to the Lenders pursuant to Section 4.02
prior to the date hereof, there has been no material adverse change in, and
there has occurred no event or condition which is likely to result in a material
adverse change in, the condition, financial or otherwise, results of operations,
business, assets or operations of (i) prior to the Approval Date, the Obligors
taken as a whole or (ii)on and after the Approval Date, the Parent Guarantor
and the Subsidiaries taken as a whole.
SECTION 4.04. Title to Properties; Possession Under Leases. (a)
To the best of the Parent Guarantor's knowledge, each of the Parent
Guarantor and the Principal Subsidiaries has good and marketable title to, or
valid leasehold interests in, all its material properties and assets and
licenses, easements, rights of way and other rights to use, except for minor
defects in title that do not interfere with its ability to conduct its business
as currently conducted or to utilize such properties and assets for their
intended purposes. All such material properties and assets are free and clear of
Liens, other than Liens expressly permitted by Section 6.01.
(b) Each of the Parent Guarantor and the Principal Subsidiaries
has complied with all obligations under all material leases to which it is a
party and all such leases are in full force and effect, except where such
failure to comply or maintain such leases in full force and effect would not
have a Material Adverse Effect. Each of the Parent Guarantor and the
Subsidiaries enjoys peaceful and undisturbed possession under all such material
leases except where such failure would not have a Material Adverse Effect.
SECTION 4.05. Ownership of Subsidiaries. The Parent Guarantor
owns, free and clear of any Lien (other than Liens expressly permitted by
Section 6.01), all of the issued and outstanding shares of common stock of each
of the Principal Subsidiaries.
SECTION 4.06. Litigation; Compliance with Laws. (a) There is no
action, suit, or proceeding, or any governmental investigation or any
arbitration, in each case pending or, to the knowledge of the Parent Guaran-
tor, threatened against the Parent Guarantor or any of the Subsidiaries or any
material property of any thereof before any court or arbitrator or any
governmental or administrative body, agency, or official on the date hereof or
the date of the initial Borrowing which (i) challenges the validity of this
Agreement or the Notes or (ii), except as disclosed in the Parent Guarantor's
Annual Report on Form 10-K for the fiscal year ended December 31, 1996 or its
Quarterly Reports on Form 10-Q for the quarterly periods ended March 31, 1997,
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June 30, 1997 and September 30, 1997 furnished to the Lenders pursuant to
Section 4.02 prior to the date hereof, may have a Material Adverse Effect.
(b) Neither the Parent Guarantor nor any of the Subsidiaries is in
violation of any law, rule, or regulation, or in default with respect to any
judgment, writ, injunction or decree of any Governmental Authority, where such
violation or default could reasonably be anticipated to result in a Material
Adverse Effect.
SECTION 4.07. Agreements. (a) Neither the Parent Guarantor nor
any of the Subsidiaries is a party to any agreement or instrument or subject
to any corporate restriction that has resulted, or could reasonably be
anticipated to result, in a Material Adverse Effect.
(b) Neither the Parent Guarantor nor any of the Subsidiaries is in
default in any manner under any provision of any indenture or other agreement or
instrument evidencing Indebtedness, or any other material agreement or
instrument to which it is a party or by which it or any of its properties or
assets are or may be bound, where such default could reasonably be anticipated
to result in a Material Adverse Effect.
SECTION 4.08. Federal Reserve Regulations. No part of the
proceeds of the Advances will be used, whether directly or indirectly, and
whether immediately, incidentally, or ultimately, for any purpose which
entails a violation of, or which is inconsistent with, the provisions of
the Margin Regulations.
SECTION 4.09. Investment Company Act; Public Utility Holding
Company Act. Neither the Parent Guarantor nor any of the Subsidiaries is (a) an
"investment company" as defined in, or subject to regulation under, the Invest-
ment Company Act of 1940 or (b) a "holding company" as defined in, or subject
to regulation under, the Public Utility Holding Company Act of 1935.
SECTION 4.10. Use of Proceeds. The Borrower will use the proceeds
of the Advances only for the purposes specified in Section 5.05.
SECTION 4.11. Tax Returns. Each of the Parent Guarantor and the
Subsidiaries has filed or caused to be filed all Federal, state and local tax
returns required to have been filed by it and has paid or caused to be paid all
taxes shown to be due and payable on such returns or on any assessments received
by it, except taxes that are being contested in good faith by appropriate
proceedings and for which the Parent Guarantor shall have set aside on its books
adequate reserves.
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SECTION 4.12. No Material Misstatements. No statement, informa-
tion, report, financial statement, exhibit, or schedule furnished by or on
behalf of the Parent Guarantor to the Administrative Agent, the
Co-Administrative Agent or any Lender in connection with the syndication or
negotiation of this Agreement or included herein or delivered pursuant hereto
contained, contains, or will contain any material misstatement of fact or
intentionally omitted, 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, are, or will be made, not misleading.
SECTION 4.13. Employee Benefit Plans. (a) Each Plan is in
compliance with ERISA, except for such noncompliance that has not resulted,
and could not reasonably be anticipated to result, in a Material Adverse Effect.
(b) No Plan has an accumulated or waived funding deficiency within
the meaning of Section 412 or Section 418B of the Code, except for any such
deficiency that has not resulted, and could not reasonably be anticipated to
result, in a Material Adverse Effect.
(c) No proceedings have been instituted to terminate any Plan,
except for such proceedings where the termination of a Plan has not resulted,
and could not reasonably be anticipated to result, in a Material Adverse Effect.
(d) Neither the Parent Guarantor nor any Subsidiary or ERISA
Affiliate has incurred any liability to or on account of a Plan under ERISA
(other than obligations to make contributions in accordance with such Plan), and
no condition exists which presents a material risk to the Parent Guarantor or
any Subsidiary of incurring such a liability, except for such liabilities that
have not resulted, and could not reasonably be anticipated to result, in a
Material Adverse Effect.
SECTION 4.14. Insurance. Each of the Parent Guarantor and
the Principal Subsidiaries maintains insurance with financially sound and
reputable insurers, or self-insurance, with respect to its properties and
business against loss or damage of the kind customarily insured against by
reputable companies in the same or similar business and of such types and in
such amounts (with such deductible amounts) as is customary for such companies
under similar circumstances.
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ARTICLE V
AFFIRMATIVE COVENANTS
The Parent Guarantor covenants and agrees with the Administrative Agent
and each Lender that, so long as this Agreement shall remain in effect or the
principal of or interest on any Advance (or any portion thereof), or any other
expenses or amounts payable hereunder, shall be unpaid, the Parent Guarantor
will:
SECTION 5.01. Existence, Businesses and Properties. (a) Preserve
and maintain, cause each of the Principal Subsidiaries to
preserve and maintain, and cause each other Subsidiary to preserve and maintain
(where the failure by any such other Subsidiary to so preserve and maintain
would likely result in a Material Adverse Effect), its corporate existence,
rights and franchises, provided, however, that the corporate existence of any
Principal Subsidiary (other than the Borrower) may be terminated if such
termination is not disadvantageous to the Administrative Agent or any Lender;
(b) continue to own all of the outstanding shares of common stock
of each Principal Subsidiary other than the Borrower, and continue to own
outstanding shares of common stock of the Borrower carrying voting power
sufficient to elect a majority of the Board of Directors of the Borrower and
representing at least 51% of the economic interests in the Borrower;
(c) comply, and cause each of the Subsidiaries to comply, in all
material respects, with all applicable laws, rules, regulations and orders;
(d) pay, and cause each of the Subsidiaries to pay, before any
such amounts become delinquent, (i) all taxes, assessments and governmental
charges imposed upon it or upon its property, and (ii) all claims (including,
without limitation, claims for labor, materials, supplies, or services) which
might, if unpaid, become a Lien upon its property, unless, in each case, the
validity or amount thereof is being disputed in good faith, and the Parent
Guarantor has maintained adequate reserves with respect thereto;
(e) keep, and cause each of the Subsidiaries to keep, proper books
of record and account, containing complete and accurate entries of all financial
and business transactions of the Parent Guarantor and such Subsidiary;
(f) continue to carry on, and cause each Principal Subsidiary to
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continue to carry on, substantially the same type of business as the Parent
Guarantor or such Principal Subsidiary conducted as of the date hereof and
business reasonably related thereto; and
(g) maintain or cause to be maintained insurance with financially
sound and reputable insurers, or self-insurance, with respect to its properties
and business and the properties and business of the Subsidiaries against loss or
damage of the kinds customarily insured against by reputable companies in the
same or similar businesses, such insurance to be of such types and in such
amounts (with such deductible amounts) as is customary for such companies under
similar circumstances;
provided, however, that the foregoing shall not limit the right of the Parent
Guarantor or any of its Subsidiaries to engage in any transaction not otherwise
prohibited by Section 6.02, 6.03 or 6.04.
SECTION 5.02. Financial Statements, Reports, etc. In the case of
the Parent Guarantor, furnish to the Administrative Agent and
each Lender:
(a) as soon as available and in any event within 110 days
after the end of each fiscal year, (i) consolidated balance sheets and
the related statements of income and cash flows of the Parent Guarantor
and its Subsidiaries (the Parent Guarantor and its Subsidiaries being
collectively referred to as the "Companies") as of the close of such
fiscal year (which requirement shall be deemed satisfied by the
delivery of the Parent Guarantor's Annual Report on Form 10-K (or any
successor form) for such year), all audited by KPMG Peat Marwick or
other independent public accountants of recognized national standing
and accompanied by an opinion of such accountants to the effect that
such consolidated financial statements fairly present in all material
respects the financial condition and results of operations of the
Companies an a consolidated basis in accordance with GAAP consistently
applied and (ii) if on the date they are to be so furnished the
Approval Date has not yet occurred, a balance sheet and the related
statements of income and cash flows of each Subsidiary Guarantor as of
the close of such fiscal year, each certified by a Financial Officer as
fairly presenting the financial condition and results of operations of
such Subsidiary Guarantor in accordance with GAAP consistently applied;
(b) within 65 days after the end of each of the first three
fiscal quarters of each fiscal year, (i) consolidated balance sheets
and related statements of income and cash flows of the Companies as of
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the close of such fiscal quarter and the then elapsed portion of the
fiscal year (which requirement shall be deemed satisfied by the
delivery of the Parent Guarantor's Quarterly Report on Form 10-Q (or
any successor form) for such quarter), each certified by a Financial
Officer as fairly presenting the financial condition and results of
operations of the Companies on a consolidated basis in accordance with
GAAP consistently applied, subject to normal year-end audit adjustments
and (ii) if on the date they are to be so furnished the Approval Date
has not yet occurred, a balance sheet and related statements of income
and cash flows of each Subsidiary Guarantor as of the close of such
fiscal quarter and the then elapsed portion of the fiscal year, each
certified by a Financial Officer as fairly presenting the financial
condition and results of operations of such Subsidiary Guarantor in
accordance with GAAP consistently applied, subject to normal year-end
audit adjustments;
(c) promptly upon the mailing or filing thereof copies of all
financial statements, reports and proxy statements mailed to the Parent
Guarantor's public shareholders, and copies of all registration
statements (other than those on Form S-8) and Form 8-K's (to the extent
that such Form 8-K's disclose actual or potential adverse developments
with respect to the Parent Guarantor or any of its Subsidiaries that
constitute, or could reasonably be anticipated to constitute, a
Material Adverse Effect) filed with the Securities and Exchange
Commission (or any successor thereto) or any national securities
exchange;
(d) prompt notice of any reduction in the credit rating given
to the Parent Guarantor by any Rating Agency;
(e) promptly after (i) the occurrence thereof, notice of any
ERISA Termination Event or "prohibited transaction", as such term is
defined in Section 4975 of the Code, with respect to any Plan that
results, or could reasonably be anticipated to result, in a Material
Adverse Effect, which notice shall specify the nature thereof and the
Parent Guarantor's proposed response thereto, and (ii) actual knowledge
thereof copies of any notice of PBGC's intention to terminate or to
have a trustee appointed to administer any Plan; and
(f) promptly, from time to time, such other information,
regarding its operations, business affairs and financial condition, or
compliance with the terms of this Agreement, as the Administrative
Agent or any Lender may reasonably request.
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SECTION 5.03. Litigation and other Notices. Furnish to the Admin-
istrative Agent and each Lender prompt written notice of
the following:
(a) any Event of Default or Default, specifying the nature and
extent thereof and the corrective action (if any) proposed to be taken
with respect thereto;
(b) the filing or commencement of, or any threat or notice of
intention of any person to file or commence, any action, suit or
proceeding, whether at law or in equity or by or before any
governmental authority, against the Parent Guarantor or any of the
Subsidiaries which is reasonably likely to be adversely determined and
which, if adversely determined, could reasonably be anticipated to
result in a Material Adverse Effect; and
(c) any development with respect to the Parent Guarantor or
any Subsidiary that has resulted in, or could reasonably be anticipated
to result in, a Material Adverse Effect.
SECTION 5.04. Maintaining Records. Maintain all financial records
in accordance with GAAP and, upon reasonable notice, permit any Lender to visit
and inspect the financial records of the Parent Guarantor at reasonable times
and as often as requested and to make extracts from and copies of such financial
records, and permit any representatives designated by any Lender to discuss
the affairs, finances and condition of the Parent Guarantor with the appropriate
officers thereof and, with the Parent Guarantor's consent (which shall not be
unreasonably withheld, the independent accountants therefore; provided, however,
that if the Parent Guarantor shall so require, a single representative shall be
appointed by the Majority Lenders to exercise the rights granted under this
Section 5.04.
SECTION 5.05. Use of Proceeds. Use the proceeds of the Advances
only for the purposes set forth in the preamble of this Agreement; provided,
however, that no such proceeds shall be used directly or indirectly in connec-
tion with (i) the acquisition of in excess of 5% of any class of equity security
that is registered pursuant to Section 12 of the Securities Exchange Act of
1934, as amended (the "Exchange Act"), (ii) any transaction subject to the
requirements of Section 13 of the Exchange Act or (iii) any transaction subject
to the requirements of Section 14 of the Exchange Act with respect to which
proxies, consents or authorizations, as the case may be, are being sought by any
person (as defined in the Exchange Act) other than the majority of the board
of directors of the issuer of the securities in respect of which such proxies,
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consents or authorizations are being sought.
ARTICLE VI
NEGATIVE COVENANTS
The Parent Guarantor covenants and agrees with each Lender and the
Administrative Agent that, so long as this Agreement shall remain in effect or
the principal of or interest on any Advance (or any portion thereof), or any
other expenses or amounts payable hereunder, shall be unpaid, it will not:
SECTION 6.01. Liens. Create, incur, assume, or suffer to exist,
or permit any of the Principal Subsidiaries to create, incur, assume, or suffer
to exist, any Lien on any of its property now owned or hereafter acquired to
secure any Indebtedness of the Parent Guarantor or any such Principal Sub-
sidiary, other than (a) Liens incurred or deposits made in the ordinary course
of business to secure surety and appeal bonds, leases, return-of-money bonds and
other similar obligations (exclusive of obligations of the payment of borrowed
money); (b) Liens created under or in connection with the First Mortgage Bond
Indenture or any other indentures governing the issuance of mortgage bonds by
the Parent Guarantor; (c) pledges or deposits to secure the utility obligations
of the Parent Guarantor incurred in the ordinary course of business; (d) Liens
upon or in property now owned or hereafter acquired to secure Indebtedness
incurred solely for the purpose of financing the acquisition, construction or
improvement of any property, provided that such Indebtedness shall not exceed
the fair market value of the property being acquired, constructed or improved;
(e) Liens on the assets of any Principal Subsidiary to secure the repayment
of project financing for such Principal Subsidiary; (f) Liens on the assets
of any Person merged or consolidated with or into(in accordance with Section
6.04) the Parent Guarantor or any Principal Subsidiary that were in effect at
the time of such merger or consolidation; and (g) Liens securing Indebtedness of
the Parent Guarantor or of any Principal Subsidiary to the U.S.Rural
Electrification Administration (or any successor agency) or to the U.S. Rural
Telephone Bank (or any successor agency); provided, however, that the Parent
Guarantor or any Principal Subsidiary may create, incur, assume or suffer to
exist other Liens (in addition to Liens excepted by the foregoing clauses (a)
through (g)) on its assets so long as the assets subject to such Liens do not
represent in the aggregate more than 30% of the Parent Guarantor's
Consolidated Tangible Assets.
SECTION 6.02. Ownership of the Principal Subsidiaries. Sell,
assign, pledge, or otherwise transfer or dispose of any shares of common stock,
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voting stock, or stock convertible into voting or common stock of any Principal
Subsidiary except to another Subsidiary or (in the case of stock of the Bor-
rower) if such transaction would not result in a violation of Section 5.01(b).
SECTION 6.03. Asset Sales. Permit any Principal Subsidiary to
sell, assign, or otherwise dispose of assets (whether in one transaction or a
series of transactions), if after giving effect to such transaction, (a) such
Principal Subsidiary (if not the Borrower) will have disposed of, in the
aggregate, assets representing more than 25% of such Principal Subsidiary's
Subsidiary first became a Principal Subsidiary or (b) such Principal Subsidiary
(if the Borrower) will have disposed of, in the aggregate, assets representing
more than 25% of such Principal Subsidiary's aggregate Consolidated Tangible
Assets as of the date of such transaction; provided that any Principal Sub-
sidiary may transfer assets representing up to 100% of such Principal
Subsidiary's Consolidated Tangible Assets to any other Subsidiary or to the
Parent Guarantor.
SECTION 6.04. Mergers. Merge or consolidate with, or sell, assign,
lease, or otherwise dispose of (whether in one transaction or a series of
transactions) all or substantially all of its assets (whether now owned or
hereafter acquired) to any person, or permit any Principal Subsidiary to do so,
except that (a) any Subsidiary (other than the Borrower) may merge into or,
subject to Section 6.03, transfer assets to the Parent Guarantor or any other
Subsidiary and the Parent Guarantor may merge with any person and (b) the
Borrower may, subject to Section 5.01(b), merge with another Person if, im-
mediately thereafter and after giving effect thereto, no event shall occur or
be continuing which constitutes an Event of Default or a Default; provided that,
immediately thereafter and after giving effect thereto, no event shall occur or
be continuing which constitutes an Event of Default or a Default and, in the
case of any such merger to which the Parent Guarantor is a party, either the
Parent Guarantor is the surviving corporation or the surviving entity (if not
the Parent Guarantor) has a consolidated net worth (as determined in accordance
with GAAP) immediately subsequent to such merger at least equal to the
Consolidated Net Worth of the Parent Guarantor immediately prior to such
merger and expressly assumes the obligations of the Parent Guarantor under
the Loan Documents; providing, however, that notwithstanding the foregoing, the
Parent Guarantor and any of the Principal Subsidiaries may sell assets in the
ordinary course of its business and may sell or otherwise dispose of worn out or
obsolete equipment on a basis consistent with good business practices.
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SECTION 6.05. Restrictions on Dividends. Enter into or permit any
Principal Subsidiary to enter into, any contract or agreement (other than with
a governmental regulatory authority having jurisdiction over the Parent
Guarantor or such Principal Subsidiary) restricting the ability of such Prin-
cipal Subsidiary to pay dividends or make distributions to the Parent Guarantor
in any manner that would impair the ability of any Obligor to meet its present
and future obligations hereunder or under any Note. The Secretary of the Parent
Guarantor or another officer of the Parent Guarantor satisfactory to the
Administrative Agent shall, prior to entry into any contract or agreement that
could restrict the ability of any Principal Subsidiary to pay dividends or make
distributions to the Parent Guarantor, deliver to the Lenders a certificate
certifying (a) to the absence of any Event of Default or Default after giving
effect to the entry by such Principal Subsidiary into such contract or agree-
ment, and (b) that such contract or agreement will not impair the ability of
the Parent Guarantor to meet its present and future obligations hereunder
or under any Note.
SECTION 6.06. Transactions with Affiliates. Sell or transfer any
property or assets to, or purchase or acquire any property or assets from,
or otherwise engage in any other transactions with, any of its Affiliates,
except that as long as no Default or Event of Default shall have occurred and be
continuing, the Parent Guarantor or any Subsidiary may engage in any of the
foregoing transactions in the ordinary course of business at prices and on terms
and conditions not less favorable to the Parent Guarantor or such Subsidiary
that could be obtained on an arm's-length basis from unrelated third parties
or as otherwise may be required by any Federal or state
Governmental Authority.
SECTION 6.07. Minimum Consolidated Net Worth. Permit its Con-
solidated Net Worth at any time to be less than $1,000,000,000.
SECTION 6.08. Subsidiary Guarantors. Permit (a) the combined
shareholders' equity of the Subsidiary Guarantors to be less than 150% of the
aggregate principal amount of the Advances outstanding at any time prior to the
Approval Date or (b) the aggregate fair market value of the tax exempt municipal
bond portfolio investments of the Subsidiary Guarantors to be less than 125%
of the aggregate principal amount of the Advances outstanding at any time
prior to the Approval Date.
ARTICLE VII
EVENTS OF DEFAULT
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In case of the happening of any of the following events ("Events of
Default"):
(a) any representation or warranty made or deemed made in or in
connection with this Agreement or the Borrowings hereunder, or any
representation, warranty, statement, or information contained in any
written report, certificate, financial statement, or other instrument
furnished in connection with or pursuant to this Agreement, shall prove
to have been false or misleading in any material respect when so made,
deemed made, or furnished;
(b) default shall be made in the payment of any principal of any
Advance (or any portion thereof) when and as the same shall become due
and payable, whether at the due date thereof or at a date fixed or for
prepayment thereof or by acceleration thereof or otherwise;
(c) default shall be made in the payment of any interest on any
Advance (or any portion thereof) or any Fee or any other amount (other
than an amount referred to in (b) above) due under any Loan Document,
when and as the same shall become due and payable, and such default
shall continue unremedied for a period of five Business Days;
(d) default shall be made in the due observance or performance of
any covenant, condition, or agreement contained in Section 5.01(f) or
Section 5.05 or in Article VI;
(e) default shall be made in the due observance or performance of
any covenant, condition, or agreement contained herein (other than
those specified in (b), (c), or (d) above) and such default shall
continue unremedied for a period of 30 days after the earlier to occur
of (i) the Parent Guarantor obtaining knowledge thereof and (ii) the
date that written notice thereof shall have been given to the Parent
Guarantor by the Administrative Agent or any Lender;
(f) 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 Parent Guarantor or any Principal
Subsidiary, or of a substantial part of the property or assets of the
Parent Guarantor or a Principal Subsidiary, under Title 11 of the
United States 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,
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sequestrator, conservator, or similar official for the Parent Guarantor
or any Principal Subsidiary or for a substantial part of the property
or assets of the Parent Guarantor or a Principal Subsidiary, or (iii)
the winding-up or liquidation of the Parent Guarantor or any Principal
Subsidiary; 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;
(g) the Parent Guarantor or any Principal Subsidiary shall (i)
voluntarily commence any proceeding or file any petition seeking relief
under Title 11 of the United States 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 (f) above,
(iii) apply for or consent to the appointment of a receiver, trustee,
custodian, sequestrator, conservator, or similar official for the
Parent Guarantor or any Principal Subsidiary or for a substantial part
of the property or assets of the Parent Guarantor or any Principal
Subsidiary, (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;
(h) the Parent Guarantor or any Principal Subsidiary, as the case
may be, fails to pay when due, or within any grace period applicable
thereto by the terms thereof any other Indebtedness of the Parent
Guarantor or any Principal Subsidiary aggregating $50,000,000 or more;
(i) the Parent Guarantor or any Principal Subsidiary shall fail to
observe or perform any covenant or agreement contained in any single
agreement or instrument relating to any Indebtedness in excess of (i)
$75,000,000 in the aggregate, with respect to any Indebtedness issued
on a tax-exempt basis, and (ii) $50,000,000 in the aggregate, with
respect to all other Indebtedness, in each case within any applicable
grace period, or any other event shall occur if the effect of such
failure or other event is to accelerate, or to permit the holder of
such Indebtedness or any other person to accelerate, the maturity of
such Indebtedness; or any such Indebtedness shall be required to be
prepaid (other than by a regularly scheduled required prepayment or the
exercise by the Parent Guarantor or such Principal Subsidiary of its
right to make a voluntary prepayment) in whole or in part prior to its
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stated maturity;
(j) a judgment or order for the payment of money in excess of
$50,000,000 and having a Material Adverse Effect shall be rendered
against the Parent Guarantor or any of the Subsidiaries and such
judgment or order shall continue unsatisfied (in the case of a money
judgment) and in effect for a period of 30 days during which execution
shall not be effectively stayed or deferred (whether by action of a
court, by agreement, or otherwise);
(k) a Plan shall fail to maintain the minimum funding standard
required by Section 412(d) of the Code for any plan year or a waiver of
such standard is sought or granted under Section 412(d), or a Plan is
or shall have been terminated or the subject of termination proceedings
under ERISA, or the Parent Guarantor or an ERISA Affiliate has incurred
a liability to or on account of a Plan under Section 4062, 4063, 4064,
4201 or 4204 of ERISA, and there shall result from any such event or
events a Material Adverse Effect;
(l) there shall have occurred a Change in Control;
(m) the Approval Date shall not have occurred on or before the
90th day after the date hereof; or
(n) before the Approval Date, the obligations of any Subsidiary
Guarantor under Article X shall be, or shall be asserted by any Obligor
to be, invalid; or on or after the Approval Date, the obligations of
the Parent Guarantor under Article X shall be, or shall be asserted by
any Obligor to be, invalid;
then, and in every such event (other than an event with respect to the Borrower
described in paragraph (f) or (g) above), and at any time thereafter during the
continuance of such event, the Administrative Agent, at the request of the
Majority Lenders, shall by notice to the Borrower, take either or both of the
following actions, at the same or different times: (i) terminate forthwith the
Commitments and (ii) declare the Advances then outstanding to be forthwith due
and payable in whole or in part, whereupon the principal of the Advances so
declared to be due and payable, together with accrued interest thereon and any
unpaid accrued Fees and all other liabilities of the Obligors accrued hereunder
and under any other Loan Document, shall become forthwith due and payable,
without presentment, demand, protest, or any other notice of any kind, all of
which are hereby expressly waived by each Obligor, anything contained herein or
in any other Loan Document to the contrary notwithstanding; and in any event
with respect to the Borrower described in paragraph (f) or (g) above, the
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Commitments shall automatically terminate and the principal of the Advances then
outstanding, together with accrued interest thereon and any unpaid accrued Fees
and all other liabilities of the Obligors accrued hereunder and under any other
Loan Document, 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 each Obligor, anything contained herein or in any other Loan
Document to the contrary notwithstanding.
ARTICLE VIII
THE ADMINISTRATIVE AGENT
SECTION 8.01. Authorization and Action. Each Lender hereby appoints
and authorizes the Administrative Agent to take such action as administrative
agent on its behalf and to exercise such powers under this Agreement as are
delegated to the Administrative Agent by the terms hereof, together with
such powers as are reasonably incidental thereto. As to any matters not
expressly provided for by this Agreement (including, without limitation,
enforcement or collection of the Notes), the Administrative Agent shall not
be required to exercise any discretion or take any action, but shall be required
to act or to refrain from acting (and shall be fully protected in so acting or
refraining from acting) upon the instructions of the Majority Lenders, and such
instructions shall be binding upon all Lenders and all holders of Notes;
provided, however, that the Administrative Agent shall not be required to take
any action which exposes the Administrative Agent to personal liability or
which is contrary to this Agreement or applicable law. The Administrative
Agent agrees to give to each Lender prompt notice of each notice given to it
by any Obligor pursuant to the terms of this Agreement.
SECTION 8.02. Administrative Agent's Reliance, Etc. Neither the
Administrative Agent nor any of its directors, officers, agents or employees
shall be liable for any action taken or omitted to be taken by it or them under
or in connection with this Agreement, except for its or their own negligence or
willful misconduct. Without limitation of the generality of the foregoing, the
Administrative Agent: (i) may treat the payee of any Note as the holder thereof
until the Administrative Agent receives and accepts an Assignment and Acceptance
an Eligible Assignee, as assignee, as provided in Section 9.07; (ii) may
consult with legal counsel (including counsel for the any Obligor), independent
public accountants and other experts selected by it and shall not be liable for
any action taken or omitted to be taken in good faith by it in accordance
with the advice of such counsel, accountants or experts; (iii) makes no warranty
or representation to any Lender and shall not be responsible to any Lender for
any statements, warranties or representations (whether written or oral) made
in or in connection with this Agreement; (iv) shall not have any duty to
ascertain or to inquire as to the performance or observance of any of the
terms, covenants or conditions of this Agreement on the part of the Borrower
or to inspect the property (including the books and records) of the Borrower or
any of its Subsidiaries; (v) shall not be responsible to any Lender for the
due execution, legality, validity, enforceability, genuineness, sufficiency or
value of this Agreement or any other instrument or document furnished pursuant
hereto; and (vi) shall incur no liability under or in respect of this
Agreement by acting upon any notice, consent, certificate or other instrument
or writing (which may be by telecopier, telegram, cable or telex) believed
by it to be genuine and signed or sent by the proper party or parties.
SECTION 8.03. Citibank and Affiliates. With respect to its Com-
mitment, the Advances made by it and the Notes issued to it, Citibank shall
have the same rights and powers under this Agreement as any other Lender and
may exercise the same as though it were not the Administrative Agent;
and the term "Lender" or "Lenders" shall, unless otherwise expressly indicated,
include Citibank in its individual capacity. Citibank and its Affiliates may
accept deposits from, lend money to, act as trustee under indentures of, and
generally engage in any kind of business with, the Borrower, any of its
Subsidiaries and any person who may do business with or own securities of
the Borrower or any such Subsidiary, all as if Citibank were not the Adminis-
trative Agent and without any duty to account therefor to the Lenders.
SECTION 8.04. Lender Credit Decision. Each Lender acknowledges
that it has, independently and without reliance upon the Administrative Agent or
any other Lender and based on the financial statements referred to in Section
4.01 and such other documents and information as it has deemed appropriate,
made its own credit analysis and decision to enter into this Agreement. Each
Lender also acknowledges that it will, independently and without reliance upon
the Administrative Agent or any other Lender and based on such documents and
information as it shall deem appropriate at the time, continue to make its own
credit decisions in taking or not taking action under this Agreement.
SECTION 8.05. Indemnification . The Lenders agree to indemnify the
Administrative Agent (to the extent not reimbursed by the Borrower), ratably
according to the respective principal amounts of the Notes then held by them
(or if no Notes are at the time outstanding, ratably according to the respective
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amounts of their Commitments), from and against any and all liabilities,
obligations, losses, damages, penalties, actions, judgments, suits, costs,
expenses or disbursements of any kind or nature whatsoever which may be imposed
on, incurred by, or asserted against the Administrative Agent in any way
relating to or arising out of this Agreement or any action taken or omitted by
the Administrative Agent under this Agreement, provided that no Lender shall
be liable for any portion of such liabilities, obligations, losses, damages,
penalties, actions, judgments, suits, costs, expenses or disbursements resulting
from the Administrative Agent's gross negligence or willful misconduct. Without
limiting the foregoing, each Lender agrees to reimburse the Administrative
Agent promptly upon demand for its ratable share of any out-of-pocket expenses
(including counsel fees) incurred by the Administrative Agent in connection
with the preparation, execution, delivery, administration, modification,
amendment or enforcement (whether through negotiations, legal proceedings
or otherwise) of, or legal advice in respect of rights or responsibilities
under, this Agreement, to the extent that the Administrative Agent is not
reimbursed for such expenses by the Borrower.
SECTION 8.06. Successor Administrative Agent. The Administrative
Agent may resign at any time by giving written notice thereof to the Lenders
and the Borrower and may be removed at any time with or without cause by the
Majority Lenders. Upon any such resignation or removal, the Majority Lenders
shall have the right to appoint a successor Administrative Agent that, unless
a Default or Event of Default shall have occurred and then be continuing, is
reasonably acceptable to the Borrower. If no successor Administrative Agent
shall have been so appointed by the Majority Lenders, and shall have
accepted such appointment, within 30 days after the retiring Administrative
Agent's giving of notice of resignation or the Majority Lenders' removal of the
retiring Administrative Agent, then the retiring Administrative Agent may, on
behalf of the Lenders, appoint a successor Administrative Agent, which shall be
a commercial bank organized under the laws of the United States of America or
of any State thereof and having a combined capital and surplus of at least
$50,000,000. Upon the acceptance of any appointment as Administrative Agent
hereunder by a successor Administrative Agent, such successor Administrative
Agent shall thereupon succeed to and become vested with all the rights, powers,
privileges and duties of the retiring Administrative Agent, and the retiring
Administrative Agent shall be discharged from its duties and obligations
under this Agreement. After any retiring Administrative Agent's resignation
or removal hereunder as Administrative Agent, the provisions of this Article
VIII shall inure to its benefit as to any actions taken or omitted to be taken
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by it while it was Administrative Agent under this Agreement.
ARTICLE IX
MISCELLANEOUS
SECTION 9.01. Amendments, Etc. No amendment or waiver of any
provision of this Agreement or the A Notes, nor consent to any departure by
the Borrower therefrom, shall in any event be effective unless the same
shall be in writing and signed by the Majority Lenders, and then such waiver
or consent shall be effective only in the specific instance and for the specific
purpose for which given; provided, however, that no amendment, waiver or
consent shall, unless in writing and signed by all the Lenders (other than the
Designated Bidders), do any of the following: (a) waive any of the conditions
specified in Section 3.01, (b) increase the Commitments of such Lenders or
subject such Lenders to any additional obligations, (c) reduce the principal
of, or interest on, the A Notes or any fees or other amounts payable hereunder,
(d) postpone any date fixed for any payment of principal of, or interest on, the
A Notes or any fees or other amounts payable hereunder, (e) change the percent-
age of the Commitments or of the aggregate unpaid principal amount of the A
Notes, or the number of Lenders, which shall be required for the Lenders or any
of them to take any action hereunder or (f) amend this Section 9.01; provided
further that no amendment, waiver or consent shall, unless in writing and signed
by each Lender holding a B Note at such time, (1) reduce the principal of, or
interest on, such B Note or any fees or other amounts payable hereunder or
thereunder with respect thereto, (2) postpone any date fixed for any payment
of principal of, or interest on, such B Note or any fees or other amounts
payable hereunder or thereunder with respect thereto, or (3) subject such
Lender to any additional obligations; and provided further that no amendment,
waiver or consent shall, unless in writing and signed by the Administra-
tive Agent in addition to the Lenders required above to take such action,
affect the rights or duties of the Administrative Agent under this Agree-
ment or any Note. This Agreement and the Notes constitute the entire
agreement of the parties with respect to the subject matter hereof and thereof.
SECTION 9.02. Notices, Etc. All notices and other communications
provided for hereunder shall be in writing (including telecopier, telegraphic,
telex or cable communication) and mailed, telecopied, telegraphed, telexed,
cabled or delivered, if to any Obligor, at P.O.Box 3801, High Ridge Park,
Stamford, Connecticut 06905, Attention: Robert J. DeSantis, Vice President and
Treasurer
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of the Parent Guarantor, telephone no. (203) 614-5052, telecopier number
(203) 614-4625; if to any Lender (other than a Designated Bidder), at the
Domestic Lending Office specified in the Administrative Questionnaire of
such Lender or in the Assignment and Acceptance pursuant to which it became a
Lender; if to any Designated Bidder, at the Domestic Lending Office specified in
the Designation Agreement pursuant to which it became a Lender; and if to the
Administrative Agent, Citibank, N.A., 2 Penn's Way, Suite 200, New Castle,
Delaware, 19720, Attention: Mr. Savas Divan, telephone no. (302) 894-6030
telecopier no.(302) 894-6120*; or, as to the Borrower or the Administrative
Agent, at such other address as shall be designated by such party in a written
notice to the other parties and, as to each other party, at such other address
as shall be designated by such party in a written notice to the Borrower
and the Administrative Agent. All such notices and communications shall, when
mailed, telecopied, telegraphed, telexed or cabled, be effective when received
(if deposited in the mails), telecopied, delivered to the telegraph company,
confirmed by telex answerback or delivered to the cable company, respectively,
except that notices and communications to the Administrative Agent pursuant to
Article II or VII shall not be effective until received by the Administrative
Agent.
SECTION 9.03. No Waiver; Remedies. No failure on the part of
any Lender or the Administrative Agent to exercise, and no delay in exercising,
any right hereunder or under any Note shall operate as a waiver thereof; nor
shall any single or partial exercise of any such right preclude any other or
further exercise thereof or the exercise of any other right. The remedies herein
provided are cumulative and not exclusive of any remedies provided by law.
* Reflects change from executed original.
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SECTION 9.04. Costs, Expenses and Indemnification.
(a) The Borrower agrees to pay and reimburse within 30 days after
demand all costs and expenses of the Administrative Agent in connection with the
preparation, execution, delivery, administration, modification and amendment of
this Agreement, the Notes and the other documents to be delivered hereunder,
including, without limitation, the reasonable fees and out-of-pocket expenses of
counsel for the Administrative Agent with respect thereto and with respect to
advising the Administrative Agent as to its rights and responsibilities under
this Agreement. The Borrower further agrees to pay on demand all costs and
expenses, if any (including, without limitation, reasonable counsel fees and
expenses of the Administrative Agent and each of the Lenders), incurred by the
Administrative Agent or any Lender in connection with the enforcement (whether
through negotiations, legal proceedings or otherwise) of this Agreement, the
Notes and the other documents to be delivered hereunder, including, without
limitation, reasonable counsel fees and expenses in connection with the
enforcement of rights under this Section 9.04(a).
(b) The Borrower hereby indemnifies the Administrative Agent,
Citicorp Securities, Inc., each Lender and each of respective their Affiliates
and their respective officers, directors, employees, agents, advisors and
representatives (each, an "Indemnified Party") from and against any and all
claims, damages, losses, liabilities and expenses (including, without
limitation, fees and disbursements of counsel), joint or several, that may be
incurred by or asserted or awarded against any Indemnified Party, in each case
arising out of or in connection with or relating to any investigation,
litigation or proceeding or the preparation of any defense with respect thereto
arising out of or in connection with or relating to this Agreement, the Notes or
the transactions contemplated hereby or thereby or any use made or proposed to
be made with the proceeds of the Advances, whether or not such investigation,
litigation or proceeding is brought by the Borrower, any of its shareholders or
creditors, an Indemnified Party or any other person, or an Indemnified Party is
otherwise a party thereto, and whether or not any of the conditions precedent
set forth in Article III are satisfied or the other transactions contemplated by
this Agreement are consummated, except to the extent such claim, damage, loss,
liability or expense results from such Indemnified Party's negligence or willful
misconduct, or from a violation by such Indemnified Party of any law, order,
regulation or agreement to which such Indemnified Party or its properties is
subject, or from a breach of this Agreement.
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The Borrower hereby further agrees that no Indemnified Party shall
have any liability (whether direct or indirect, in contract, tort or otherwise)
to the Borrower for or in connection with or relating to this Agreement, the
Notes or the transactions contemplated hereby or thereby or any use made or
proposed to be made with the proceeds of the Advances, except to the extent such
liability is found in a final, non-appealable judgment by a court of competent
jurisdiction to have resulted from such Indemnified Party's negligence or
willful misconduct; provided that nothing in this paragraph shall be deemed to
constitute a waiver of any claim the Borrower may have, or to exculpate any
person from any liability that such person may have to the Borrower, for breach
by such person of its obligations under this Agreement.
(c) If any payment of principal of, or Conversion or Continuation
of, any Eurodollar Rate Advance is made other than on the last day of an
Interest Period for such Advance, as a result of acceleration of the maturity of
the Notes pursuant to Article VII or for any other reason (other than a payment
or Conversion pursuant to Section 2.13), the Borrower shall pay (subject to the
last sentence of this Section 9.04(c)) to the Administrative Agent for the
account of such Lender any amounts required to compensate such Lender for any
additional losses, costs or expenses which it may reasonably incur as a result
of such payment, Continuation or Conversion, including, without limitation, any
loss (excluding loss of anticipated profits), cost or expense incurred by reason
of the liquidation or reemployment of deposits or other funds acquired by any
Lender to fund or maintain such Advance. The Borrower shall pay amounts owing to
any Lender pursuant to this Section 9.04(c) within 30 days after receipt from
such Lender of a certificate setting forth in reasonable detail the calculation
of the amount such Lender is entitled to claim under this Section 9.04(c) (which
certificate shall be conclusive and binding for all purposes, absent manifest
error).
SECTION 9.05. Right of Set-off. Upon (i) the occurrence and
during the continuance of any Event of Default under Article VII or (ii) the
making of the request or the granting of the consent specified by Article
VII to authorize the Administrative Agent to declare the Notes due and payable
pursuant to the provisions of Article VII, each Lender and each of its
Affiliates 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 such Affiliate to or for
the credit or the account of the Borrower (all such deposits and other indebted-
ness being herein called "Obligations") against any and all of the obligations
of the Borrower now or hereafter existing under this Agreement and any Note held
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by such Lender, whether or not such Lender shall have made any demand under this
Agreement or such Note and although the Obligations may be unmatured. Each
Lender agrees promptly to notify the Borrower after any such set-off and
application made by such Lender or such Affiliate, provided that the failure to
give such notice shall not affect the validity of such set-off and application.
The rights of each Lender and its Affiliate under this Section are in addition
to other rights and remedies (including, without limitation, other rights of
set-off) which such Lender or such Affiliate may have.
SECTION 9.06. Binding Effect. This Agreement shall become effec-
tive when it shall have been executed by the Borrower and the Administrative
Agent and when the Administrative Agent shall have been notified by each Bank
that such Bank has executed it and thereafter shall be binding upon and
inure to the benefit of the Borrower, the Administrative Agent and each Lender
and their respective successors and assigns, except that the Borrower shall
not have the right to assign its rights hereunder or any interest herein without
the prior written consent of the Lenders.
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SECTION 9.07. Assignments, Designations and Participations.
(a) Each Lender (other than a Designated Bidder) may, with notice
to and the consent of the Administrative Agent and the Borrower, such consents
not to be unreasonably withheld (but not otherwise), assign to one or more banks
or other entities all or a portion of its rights and obligations under this
Agreement (including, without limitation, all or a portion of its Commitment,
the Advances owing to it and the Note or Notes held by it); provided, however,
that (i) no such consent by the Borrower or the Administrative Agent shall be
required in the case of any assignment to an Affiliate of the assigning Lender,
(ii) each such assignment shall be of a constant, and not a varying, percentage
of all rights and obligations of the assigning Lender under this Agreement
(other than any right to make B Advances, B Advances owing to it or B Notes),
(iii) the amount of the Commitment of the assigning Lender being assigned
pursuant to each such assignment (determined as of the date of the Assignment
and Acceptance with respect to such assignment) shall in no event be less than
$10,000,000 and shall be an integral multiple of $1,000,000 unless the Borrower
and the Administrative Agent otherwise agree, (iv) each such assignment shall be
to an Eligible Assignee, (v) the parties to each such assignment shall execute
and deliver to the Administrative Agent, for its acceptance and recording in the
Register, an Assignment and Acceptance, together with any Note or Notes subject
to such assignment, and (vi) the parties to each such assignment (other than the
Borrower) shall deliver to the Administrative Agent a processing and recordation
fee of $3,000. Upon such execution, delivery, acceptance and recording, from and
after the effective date specified in each Assignment and Acceptance, (x) the
assignee thereunder shall be a party hereto and, to the extent that rights and
obligations hereunder have been assigned to it pursuant to such Assignment and
Acceptance, have the rights and obligations of a Lender hereunder and (y) the
Lender assignor thereunder shall, to the extent that rights and obligations
hereunder have been assigned by it pursuant to such Assignment and Acceptance,
relinquish its rights and be released from its obligations under this Agreement
(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).
(b) By executing and delivering an Assignment and Acceptance, the
Lender assignor thereunder and the assignee thereunder confirm to and agree with
each other and the other parties hereto as follows: (i) other than as provided
in such Assignment and Acceptance, such assigning Lender makes no representation
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or warranty and assumes no responsibility with respect to any statements,
warranties or representations made in or in connection with this Agreement or
the execution, legality, validity, enforceability, genuineness, sufficiency or
value of this Agreement or any other instrument or document furnished pursuant
hereto; (ii) such assigning Lender makes no representation or warranty and
assumes no responsibility with respect to the financial condition of the
Borrower or the performance or observance by the Borrower of any of its
obligations under this Agreement or any other instrument or document furnished
pursuant hereto; (iii) such assignee confirms that it has received a copy of
this Agreement, together with copies of the financial statements referred to in
Section 4.01 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; (iv) such assignee will, independently and without
reliance upon the Administrative Agent, such assigning Lender or any other
Lender and based on such documents and information as it shall deem appropriate
at the time, continue to make its own credit decisions in taking or not taking
action under this Agreement; (v) such assignee confirms that it is an Eligible
Assignee; (vi) such assignee appoints and authorizes the Administrative Agent to
take such action as administrative agent on its behalf and to exercise such
powers under this Agreement as are delegated to the Administrative 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 of the obligations which by the terms of this Agreement are required
to be performed by it as a Lender.
(c) Upon its receipt of an Assignment and Acceptance executed by
an assigning Lender and an assignee representing that it is an Eligible
Assignee, together with any Note or Notes subject to such assignment, the
Administrative Agent shall, if such Assignment and Acceptance has been completed
(and the Borrower and the Administrative Agent shall have consented to the
relevant assignment to the extent required pursuant to Section 9.07(a)) and is
in substantially the form of Exhibit C hereto, (i) accept such Assignment and
Acceptance, (ii) record the information contained therein in the Register and
(iii) give prompt notice thereof to the Borrower. Within five Business Days
after its receipt of such notice, the Borrower, at its own expense, shall
execute and deliver to the Administrative Agent in exchange for the surrendered
Note or Notes (X) a new A Note to the order of such Eligible Assignee in an
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amount equal to the Commitment assumed by it pursuant to such Assignment and
Acceptance and, if the assigning Lender has retained a Commitment hereunder, a
new A Note to the order of the assigning Lender in an amount equal to the
Commitment retained by it hereunder and (Y) new B Note or Notes to the order of
such Eligible Assignee in an amount equal to the principal amount of the B
Advances (if any) acquired by it pursuant to such Assignment and Acceptance and,
if the assigning Lender has retained a portion of such B Advances, new B Note or
Notes to the order of the assigning Lender in an amount equal to the principal
amount of the B Advances retained by it hereunder). Such new A Note or Notes
shall be in an aggregate principal amount equal to the aggregate principal
amount of such surrendered A Note or Notes, and such new B Note or Notes shall
be in an aggregate principal amount equal to the aggregate principal amount of
such surrendered B Note or Notes. All such Notes shall be dated the effective
date of such Assignment and Acceptance and shall otherwise be in substantially
the form of Exhibit A-1 or A-2 hereto, as applicable.
(d) Each Lender (other than the Designated Bidders) may designate
one or more banks or other entities to have a right to make B Advances as a
Lender pursuant to Section 2.03; provided, however, that (i) no such Lender
shall be entitled to make more than two such designations, (ii) each such Lender
making one or more of such designations shall retain the right to make B
Advances as a Lender pursuant to Section 2.03, (iii) each such designation shall
be to a Designated Bidder and (iv) the parties to each such designation shall
execute and deliver to the Administrative Agent, for its acceptance and
recording in the Register, a Designation Agreement. Upon such execution,
delivery, acceptance and recording, from and after the effective date specified
in each Designation Agreement, the designee thereunder shall be a party hereto
with a right to make B Advances as a Lender pursuant to Section 2.03 and the
obligations related thereto.
(e) By executing and delivering a Designation Agreement, the
Lender making the designation thereunder and its designee thereunder confirm and
agree with each other and the other parties hereto as follows: (i) such Lender
makes no representation or warranty and assumes no responsibility with respect
to any statements, warranties or representations made in or in connection with
this Agreement or the execution, legality, validity, enforceability,
genuineness, sufficiency or value of this Agreement or any other instrument or
document furnished pursuant hereto; (ii) such Lender makes no representation or
warranty and assumes no responsibility with respect to the financial condition
of the Borrower or the performance or observance by the Borrower of any of its
obligations under this Agreement or any other instrument or document furnished
pursuant hereto; (iii) such designee confirms that it has received a copy of
this Agreement, together with copies of the financial statements referred to in
Section 4.01 and such other documents and information as it has deemed
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appropriate to make its own credit analysis and decision to enter into the
Designation Agreement; (iv) such designee will, independently and without
reliance upon the Administrative Agent, such designating Lender or any other
Lender and based on such documents and information as it shall deem appropriate
at the time, continue to make its own credit decisions in taking or not taking
action under this Agreement; (v) such designee confirms that it is a Designated
Bidder; (vi) such designee appoints and authorizes the Administrative Agent to
take such action as administrative agent on its behalf and to exercise such
powers under this Agreement as are delegated to the Administrative Agent by the
terms hereof, together with such powers as are reasonably incidental thereto;
and (vii) such designee agrees that it will perform in accordance with their
terms all of the obligations which by the terms of this Agreement are required
to be performed by it as a Lender.
(f) Upon its receipt of a Designation Agreement executed by a
designating Lender and a designee representing that it is a Designated Bidder,
the Administrative Agent shall, if such Designation Agreement has been completed
and is substantially in the form of Exhibit D hereto, (i) accept such
Designation Agreement, (ii) record the information contained therein in the
Register and (iii) give prompt notice thereof to the Borrower.
(g) The Administrative Agent shall maintain at its address
referred to in Section 9.02 a copy of each Assignment and Acceptance and each
Designation Agreement delivered to and accepted by it and a register for the
recordation of the names and addresses of each of the Lenders and, with respect
to Lenders other than Designated Bidders, the Commitment of, and principal
amount of the A Advances owing to, each such Lender from time to time (the
"Register"). The entries in the Register shall be conclusive and binding for the
purposes, absent manifest error, and the Borrower, the Administrative Agent and
the Lenders may treat each person whose name is recorded in the Register as a
Lender hereunder for the purposes of this Agreement. The Register shall be
available for inspection by the Borrower or any Lender at any reasonable time
and from time to time upon reasonable prior notice.
(h) Each Lender may sell participations to one or more banks or
other entities in or to all or a portion of its rights and obligations under
this Agreement (including, without limitation, all or a portion of its
Commitment, the Advances owing to it and the Note or Notes held by it);
provided, however, that (i) such Lender's obligations under this Agreement
(including, without limitation, its Commitment to the Borrower hereunder) shall
remain unchanged, (ii) such Lender shall remain solely responsible to the other
parties hereto for the performance of such obligations, (iii) such Lender shall
Credit Agreement
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remain the holder of any such Note for all purposes of this Agreement, (iv) the
Borrower, the Administrative Agent and the other Lenders shall continue to deal
solely and directly with such Lender in connection with such Lender's rights and
obligations under this Agreement, and (v) no participant under any such
participation agreement shall have any right to approve any amendment or waiver
of any provision of this Agreement or any Note, or to consent to any departure
by the Borrower therefrom, except to the extent that any such amendment, waiver
or consent would (x) reduce the principal of, or interest on, the Notes or any
fee or other amounts payable hereunder, in each case to the extent the same are
subject to such participation, or (y) postpone any date fixed for the payment of
principal of, or interest on, the Notes or any fees or other amounts payable
hereunder, in each case to the extent the same are subject to such
participation.
(i) Any Lender may, in connection with any assignment, designation
or participation or proposed assignment, designation or participation pursuant
to this Section 9.07, disclose to the assignee, designee or participant or
proposed assignee, designee or participant, any information relating to the
Parent Guarantor or any of its Subsidiaries furnished to such Lender by or on
behalf of the Parent Guarantor or the Borrower; provided that, prior to any such
disclosure, the assignee, designee or participant or proposed assignee, designee
or participant shall agree to preserve the confidentiality of any confidential
information relating to the Parent Guarantor or any such Subsidiary received by
it from such Lender on the terms set forth in Section 9.14.
(j) Notwithstanding any other provision set forth in this
Agreement, any Lender may at any time create a security interest in all or any
portion of its rights under this Agreement (including, without limitation, the
Advances owing to it and the Notes held by it) in favor of any Federal Reserve
Bank in accordance with Regulation A of the Board of Governors of the Federal
Reserve System.
(k) All amounts payable by the Borrower to any Lender under
Sections 2.08, 2.12, 2.15 and 9.04(c) in respect of Advances held by such
Lender, and such Lender's Commitment, shall be determined as if such Lender had
not sold or agreed to sell any participations in such Advances or Commitment and
as if such Lender were funding each of such Advances and Commitments in the same
way that it is funding the portion of such Advances and Commitment in which no
participations have been sold. No assignee or other transferee of any Lender's
rights shall be entitled to receive any greater payment under Section 2.12 than
such Lender would have been entitled to receive with respect to the rights
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transferred, unless such transfer is made (i) with the Borrower's prior written
consent, (ii) by reason of the provisions of said Section 2.12 requiring such
Lender to designate a different Applicable Lending Office as provided in said
Section 2.12 or (iii) at a time when the circumstances giving rise to such
greater payment did not exist.
SECTION 9.08. Governing Law; Submission to Jurisdiction. This
Agreement and the Notes shall be governed by, and construed in accordance
with, the law of the State of New York. The Borrower hereby submits to the
nonexclusive jurisdiction of the United States District Court for the Southern
District of New York and of any New York state court sitting in New York City
for the purposes of all legal proceedings arising out of or relating to this
Agreement or the transactions contemplated hereby. The Borrower irrevocably
waives, to the fullest extent permitted by applicable law, any objection that it
may now or hereafter have to the laying of the venue of any such proceeding
brought in such a court and any claim that any such proceeding brought in such a
court has been brought in an inconvenient forum.
SECTION 9.09. Severability. In case any provision in this
Agreement or in any Note shall be held to be invalid, illegal or unenforceable,
such provision shall be severable from the rest of this Agreement or such Note,
as the case may be, and the validity, legality and enforceability of the
remaining provisions shall not in any way be affected or impaired thereby.
SECTION 9.10. Execution in Courterparts. This Agreement may be
executed in any number of counterparts and by different parties hereto in
separate counterparts, each of which when so executed shall be deemed to be an
original and all of which taken together shall constitute one and the same
agreement.
SECTION 9.11. Survival. The obligations of the Borrower under
Sections 2.08, 2.12, 2.15 and 9.04 (and the Guarantees by the Guarantors of
such obligations under Article X) and the obligations of the Lenders under
Section 8.05 shall survive the repayment of the Advances and the termination
of the Commitments. In addition, each representation and warranty made,
or deemed to be made by any Notice of A Borrowing or Notice of B Borrowing,
herein or pursuant hereto shall survive the making of such representation and
warranty, and no Lender shall be deemed to have waived, by reason of making any
Advance, any Default or Event of Default that may arise by reason of such
representation or warranty proving to have been false or misleading,
notwithstanding that such Lender or the Administrative Agent may have had
notice or knowledge or reason to believe that such representation or warranty
was false or misleading at the time such extension of credit was made.
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SECTION 9.12. Waiver of Jury Trial. EACH OF THE BORROWER, THE
ADMINISTRATIVE AGENT AND THE LENDERS HEREBY IRREVOCABLY WAIVES, TO THE FULLEST
EXTENT PERMITTED BY APPLICABLE LAW, ANY AND ALL RIGHT TO TRIAL BY JURY IN ANY
LEGAL PROCEEDING ARISING OUT OF OR RELATING TO THIS AGREEMENT, THE NOTES OR THE
TRANSACTIONS CONTEMPLATED HEREBY.
SECTION 9.13. Substitution of Lender. If (a) the obligation of
any Lender to make, Continue or otherwise maintain Eurodollar Rate Advances
has been suspended pursuant to Section 2.13, (b) any Lender has demanded
compensation under Section 2.12 or 2.15 or (c) any Lender shall fail to consent
to an amendment or a waiver which pursuant to the terms of Section 9.01
requires the consent of all Lenders and with respect to which the Majority
Lenders shall have granted their consent, the Borrower shall have the right, if
no Default or Event of Default then exists, to replace such Lender (the
"Replaced Lender") with one or more Eligible Assignee(s), (each, a "Replacement
Lender") acceptable to the Administrative Agent, provided that:
(i) at the time of any replacement pursuant to this Section 9.13,
the Replacement Lenders shall enter into one or more Assignment and
Acceptance Agreements, pursuant to which such Replacement Lenders shall
acquire the Commitments and outstanding Advances of the Replaced Lender
and, in connection therewith, shall pay to the Replaced Lender in
respect thereof an amount equal to the sum of (A) an amount equal to
the principal of, and all accrued interest on, all outstanding Advances
of the Replaced Lender, (B) an amount equal to all accrued and unpaid
Facility Fees owing to the Replaced Lender and (C) an amount equal to
the amount which would be payable by the Borrower to the Replaced
Lender pursuant to Section 9.04(c) if the Borrower prepaid at the time
of such replacement all of the Advances of such Replaced Lender
outstanding at such time; and
(ii) all obligations of the Borrower owing to the Replaced Lender
(other than those specifically described in clause (i) above in respect
of which the assignment purchase price has been, or is concurrently
being, paid) shall be paid in full to such Replaced Lender concurrently
with such replacement.
Upon (I) the execution of the respective Assignment and Assumption Agreements,
(II) the payment of amounts referred to in clauses (i) and (ii) above and (III)
if so requested by a Replacement Lender, delivery to such Replacement Lender of
the appropriate Note or Notes executed by the Borrower, each Replacement Lender
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shall become a Lender hereunder and the Replaced Lender shall cease to
constitute a Lender hereunder.
SECTION 9.14. Confidentiality. Each Lender agrees to hold all
non-public information obtained pursuant to the provisions of this Agreement in
accordance with its customary procedure for handling confidential information
of this nature and in accordance with safe and sound banking practices,
provided that nothing herein shall prevent any Lender from disclosing such
information (i) to any other Lender or to the Administrative Agent (or to
Citicorp Securities, Inc.), (ii) upon the order of any court or administrative
agency or otherwise to the extent required by statute, rule, regulation or
judicial process, (iii) to bank examiners or upon the request or demand of any
other regulatory agency or authority, (iv) which had been publicly disclosed
other than as a result of a disclosure by the Administrative Agent or any
Lender prohibited by this Agreement, (v) in connection with any litigation
to which any one or more of the Lenders or the Administrative Agent is a party,
or in connection with the exercise of any remedy hereunder or under any Note,
(vi) to such Lender's or Administrative Agent's legal counsel and independent
auditors and accountants and (vii) subject to provisions substantially similar
to those contained in this Section, to any actual or proposed participant or
assignee.
Credit Agreement
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ARTICLE X
GUARANTEE
SECTION 10.01. The Guarantee. Subject to Section 10.09 hereof,
the Guarantors hereby jointly and severally guarantee to each Lender and the
Administrative Agent and their respective successors and assigns the prompt
payment in full when due (whether at stated maturity, by acceleration or
otherwise) of the principal of and interest on the Advances made by the Lenders
to, and the Notes held by each Lender of, the Borrower and all other amounts
from time to time owing to the Lenders or the Administrative Agent by the
Borrower under this Agreement and under the Notes strictly in accordance with
the terms thereof (such obligations being herein collectively called the
"Guaranteed Obligations"). Subject to Section 10.09, the Guarantors hereby
further jointly and severally agree that if the Borrower shall fail to pay in
full when due (whether at stated maturity, by acceleration or otherwise) any
of the Guaranteed Obligations, the Guarantors will promptly pay the same,
without any demand or notice whatsoever, and that in the case of any extension
of time of payment or renewal of any of the Guaranteed Obligations, the same
will be promptly paid in full when due (whether at extended maturity, by
acceleration or otherwise) in accordance with the terms of such extension or
renewal.
SECTION 10.02. Obligations Unconditional. Subject to Section
10.09, the obligations of the Guarantors under Section 10.01 are absolute
and unconditional, joint and several, irrespective of the value, genuineness,
validity, regularity or enforceability of the obligations of the Borrower under
this Agreement, the Notes or any other agreement or instrument referred
to herein or therein, or any substitution, release or exchange of any other
guarantee of or security for any of the Guaranteed Obligations, and, to
the fullest extent permitted by applicable law, irrespective of any other
circumstance whatsoever that might otherwise constitute a legal or equitable
discharge or defense of a surety or guarantor, i being the intent of this
Section 10.02 that the obligations of the Guarantors hereunder shall be absolute
and unconditional, joint and several, under any and all circumstances. Without
limiting the generality of the foregoing, but subject to Section 10.09, it is
agreed that the occurrence of any one or more of the following shall not alter
or impair the liability of the Guarantors hereunder which shall remain absolute
and unconditional as described above:
(i) at any time or from time to time, without notice to the
Guarantors, the time for any performance of or compliance with any of
the Guaranteed Obligations shall be extended, or such performance or
compliance shall be waived;
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(ii) any of the acts mentioned in any of the provisions of this
Agreement or the Notes or any other agreement or instrument referred to
herein or therein shall be done or omitted;
(iii) the maturity of any of the Guaranteed Obligations shall be
accelerated, or any of the Guaranteed Obligations shall be modified,
supplemented or amended in any respect, or any right under this
Agreement or the Notes or any other agreement or instrument referred to
herein or therein shall be waived or any other guarantee of any of the
Guaranteed Obligations or any security therefor shall be released or
exchanged in whole or in part or otherwise dealt with; or
(iv) any lien or security interest granted to, or in favor of, the
Administrative Agent or any Lender or Lenders as security for any of
the Guaranteed Obligations shall fail to be perfected.
The Guarantors hereby expressly waive diligence, presentment, demand of payment,
protest and all notices whatsoever, and any requirement that the Administrative
Agent or any Lender exhaust any right, power or remedy or proceed against the
Borrower under this Agreement or the Notes or any other agreement or instrument
referred to herein or therein, or against any other Person under any other
guarantee of, or security for, any of the Guaranteed Obligations.
SECTION 10.03. Reinstatement. Subject to Section 10.09, the
obligations of the Guarantors under this Article X shall be automatically
reinstated if and to the extent that for any reason any payment by or on behalf
of the Borrower in respect of the Guaranteed Obligations is rescinded or must be
otherwise restored by any holder of any of the Guaranteed Obligations, whether
as a result of any proceedings in bankruptcy or reorganization or otherwise and
the Guarantors jointly and severally agree that they will indemnify the
Administrative Agent and each Lender on demand for all reasonable costs and
expenses (including, without limitation, fees of counsel) incurred by the
Administrative Agent or such Lender in connection with such rescission or
restoration, including any such costs and expenses incurred in defending against
any claim alleging that such payment constituted a preference, fraudulent
transfer or similar payment under any bankruptcy, insolvency or similar law.
SECTION 10.04. Subrogation. The Guarantors hereby jointly and
severally agree that until the payment and satisfaction in full of all
Guaranteed Obligations and the expiration and termination of the Commitments
of the Lenders under this Agreement they shall not exercise any right or remedy
Credit Agreement
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arising by reason of any performance by them of their guarantee in Section
10.01, whether by subrogation or otherwise, against the Borrower or any other
guarantor of any of the Guaranteed Obligations or any security for any of the
Guaranteed Obligations.
SECTION 10.05. Remedies. Subject to Section 10.09, the Guarantors
jointly and severally agree that, as between the Guarantors and the Lenders, the
obligations of the Borrower under this Agreement and the Notes may be declared
to be forthwith due and payable as provided in Article VII (and shall be deemed
to have become automatically due and payable in the circumstances provided
in said Article VII) for purposes of Section 10.01 notwithstanding any stay,
injunction or other prohibition preventing such declaration (or such obligations
from becoming automatically due and payable) as against the Borrower and that,
in the event of such declaration (or such obligations being deemed to have
become automatically due and payable), such obligations (whether or not due
and payable by the Borrower) shall forthwith become due and payable by the
Guarantors for purposes of said Section 10.01.
SECTION 10.06 Instrument for the Payment of Money. Subject to
Section 10.09, each Guarantor hereby acknowledges that the guarantee in this
Article X constitutes an instrument for the payment of money, and consents and
agrees that any Lender or the Administrative Agent, at its sole option, in the
event of a dispute by such Guarantor in the payment of any moneys due hereunder,
shall have the right to bring motion-action under New York CPLR Section 3213.
SECTION 10.07. Continuing Guarantee. Subject to Section 10.09,
the guarantee in this Article X is a continuing guarantee, and shall apply to
all Guaranteed Obligations whenever arising.
SECTION 10.08. General Limitation on Guarantee Obligations. In
any action or proceeding involving any state corporate law, or any state or
Federal bankruptcy, insolvency, reorganization or other law affecting the rights
of creditors generally, if the obligations of any Subsidiary Guarantor under
Section 10.01 would otherwise be held or determined to be void, invalid or
unenforceable, or subordinated to the claims of any other creditors, on account
of the amount of its liability under said Section 10.01, then, notwithstanding
any other provision hereof to the contrary, the amount of such liability shall,
without any further action by such Subsidiary Guarantor, any Lender, the
Administrative Agent or any other Person, be automatically limited and reduced
Credit Agreement
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to the highest amount that is valid and enforceable and not subordinated to the
claims of other creditors as determined in such action or proceeding.
SECTION 10.09. Effectiveness of Guarantee. Notwithstanding any-
thing contained herein to the contrary, the Parent Guarantor shall have no
obligations under this Article X until the Approval Date. On the Approval Date,
the obligations of the Parent Guarantor under this Article X shall become
effective and the obligations of the Subsidiary Guarantors under this Article X
shall terminate.
Credit Agreement
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IN WITNESS WHEREOF, the parties hereto have caused this Agreement
to be executed by their respective officers thereunto duly authorized, as of the
date first above written.
BORROWER
ELECTRIC LIGHTWAVE, INC.
By /s/ David B. Sharkey
Title: President
PARENT GUARANTOR
CITIZENS UTILITIES COMPANY
By /s/ Robert J. DeSantis
Title: Vice President and Treasurer
SUBSIDIARY GUARANTORS
SOUTHWESTERN INVESTMENTS, INC.
By /s/ Robert J. DeSantis
Title: Vice President, Treasurer and
Chief Financial Officer
SOUTHWESTERN CAPITAL CORP.
By /s/ Robert J. DeSantis
Title: Vice President, Treasurer and
Chief Financial Officer
CU CAPITALCORP
By /s/ Robert J. DeSantis
Title: Vice President, Treasurer and
Chief Financial Officer
Credit Agreement
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ADMINISTRATIVE AGENT
CITIBANK, N.A., as
Administrative Agent
By /s/ Mary S. Thomas
Title: Attorney-in-Fact
Commitment BANKS
$165,000,000 CITIBANK, N.A.
By /s/ Mary S. Thomas
Title: Attorney-in-Fact
$ 60,000,000 BANK OF AMERICA NATIONAL TRUST AND
SAVINGS ASSOCIATION
By /s/ Vanessa Sheh Meyer
Title: Managing Director
$ 60,000,000 DEUTSCHE BANK AG,
NEW YORK BRANCH
AND/OR CAYMAN ISLANDS BRANCH
By /s/ V. Shannon Sewsanker
Title: Assistant Vice President
By /s/ Susan M. O'Connor
Title: Director
$ 40,000,000 THE FUJI BANK, LIMITED,
SAN FRANCISCO AGENCY
Credit Agreement
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By /s/ Keiichi Ozawa
Title: Joint General Manager
Credit Agreement
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$ 25,000,000 BANK OF HAWAII
By /s/ Joseph T. Donalson
Title: Vice President
$ 25,000,000 FLEET NATIONAL BANK
By /s/ Robert D. Lanigan
Title: Director
$ 25,000,000 SUNTRUST BANK, ATLANTA
By /s/ W. David Wisdom
Title: Group Vice President
By /s/ Laura G. Harrison
Title: Assistant Vice President
Credit Agreement
EXHIBIT A-1
FORM OF A NOTE
U.S.$______________ Dated: _________ __, _____
FOR VALUE RECEIVED, the undersigned, ELECTRIC LIGHTWAVE, INC., a
Delaware corporation (the "Borrower"), HEREBY PROMISES TO PAY to the order of
_________________ (the "Lender") for the account of its Applicable Lending
Office (as defined in the Credit Agreement referred to below) on the Termination
Date (as so defined) the principal sum of U.S.$[amount of the Lender's
Commitment in figures] or, if less, the aggregate principal amount of the A
Advances (as defined below) made by the Lender to the Borrower pursuant to the
Credit Agreement then outstanding.
The Borrower promises to pay interest on the unpaid principal
amount of each A Advance from the date of such A Advance until such principal
amount is paid in full, at such interest rates, and payable at such times, as
are specified in the Credit Agreement.
Both principal and interest are payable in lawful money of the
United States of America to Citibank, N.A., as Administrative Agent, at 1 Court
Square, 7th Floor, Long Island City, New York 11120, in same day funds. Each A
Advance made by the Lender to the Borrower pursuant to the Credit Agreement, and
all payments made on account of principal thereof, shall be recorded by the
Lender and, prior to any transfer hereof, endorsed on the grid attached hereto
which is part of this Promissory Note; provided that the failure of the Lender
to make any such recordation or endorsement shall not affect the obligations of
the Borrower hereunder or under the Credit Agreement.
This Promissory Note is one of the A Notes referred to in, and is
entitled to the benefits of, the Credit Agreement dated as of November 21, 1997
(the "Credit Agreement") among the Borrower, the Guarantors referred to therein,
the Lender and certain other banks parties thereto, and Citibank, N.A., as
Administrative Agent for the Lender and such other banks. The Credit Agreement,
among other things, (i) provides for the making of advances (the "A Advances")
by the Lender to the Borrower from time to time in an aggregate amount not to
exceed at any time outstanding the U.S. dollar amount first above mentioned, the
indebtedness of the Borrower resulting from each such A Advance 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.
Credit Agreement
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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 law of the State of New York, United States.
ELECTRIC LIGHTWAVE, INC.
By__________________________
Title:
Form of A Note
- 3 -
ADVANCES AND PAYMENTS OF PRINCIPAL
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Amount of Unpaid of
Amount of Principal Paid Principal Notation
Date Advance or Prepaid Balance Made By
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Form of A Note
EXHIBIT A-2
FORM OF B NOTE
U.S.$______________ Dated: _________ __, _____
FOR VALUE RECEIVED, the undersigned, ELECTRIC LIGHTWAVE, INC., a
Delaware corporation (the "Borrower"), HEREBY PROMISES TO PAY to the order of
_________________ (the "Lender") for the account of its Applicable Lending
Office (as defined in the Credit Agreement referred to below), on
______________, _____, the principal amount of __________ Dollars
($___________).
The Borrower promises to pay interest on the unpaid principal
amount hereof from the date hereof until such principal amount is paid in full,
at the interest rate and payable on the interest payment date or dates provided
below:
Interest Rate: _____% per annum (calculated on the basis of a year of
_____ days for the actual number
of days elapsed).
Interest Payment Date or Dates: ___________________________
Both principal and interest are payable in lawful money of the
United States of America to ______________ or the account of the Lender at the
office of ________________________________, at _____________________, in same
day funds.
This Promissory Note is one of the B Notes referred to in, and is
entitled to the benefits of, the Credit Agreement dated as of November 21, 1997
(the "Credit Agreement") among the Borrower, the Guarantors referred to therein,
the Lender and certain other banks parties thereto, and Citibank, N.A., as
Administrative Agent for the Lender and such other banks. The Credit Agreement,
among other things, contains provisions for acceleration of the maturity hereof
upon the happening of certain stated events.
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.
Form of A Note
- 2 -
This Promissory Note shall be governed by, and construed in
accordance with, the law of the State of New York, United States.
ELECTRIC LIGHTWAVE, INC.
By_________________________
Title:
Form of B Note
EXHIBIT B-1
NOTICE OF A BORROWING
Citibank, N.A., as Administrative
Agent for the Lenders parties
to the Credit Agreement
referred to below
1 Court Square, 7th Floor, Zone 7
Long Island City, New York 11120
Attention: Kim Coley
[Date]
Ladies and Gentlemen:
The undersigned, Electric Lightwave, Inc., refers to the Credit
Agreement, dated as of November 21, 1997 (the "Credit Agreement", the terms
defined therein being used herein as therein defined), among the undersigned,
the Guarantors referred to therein, certain Lenders parties thereto and
Citibank, N.A., as Administrative Agent for said Lenders, and hereby gives you
notice, irrevocably, pursuant to Section 2.02 of the Credit Agreement that the
undersigned hereby requests an A Borrowing under the Credit Agreement, and in
that connection sets forth below the information relating to such A Borrowing
(the "Proposed A Borrowing") as required by Section 2.02(a) of the Credit
Agreement:
(i) The Business Day of the Proposed A Borrowing is ___________
__, _____.
(ii) The Type of A Advances comprising the Proposed A Borrowing is
[Base Rate Advances] [Eurodollar Rate Advances].
(iii) The aggregate amount of the Proposed A Borrowing is
$___________.
[(iv) The initial Interest Period for each A Advance made as part
of the Proposed A Borrowing is ______ month[s]]**.
The undersigned hereby certifies that the following statements are
true on the date hereof, and will be true on the date of the Proposed A
Borrowing:
(A) the representations and warranties contained in
** For Eurodollar Rate Advances only.
Form of B Note
- 2 -
Article IV [(other than Sections 4.03 and 4.06)]*** are correct, before
and after giving effect to the Proposed A Borrowing and to the
application of the proceeds therefrom, as though made on and as of such
date; and
(B) no event has occurred and is continuing, or would result from
such Proposed A Borrowing or from the application of the proceeds
therefrom, which constitutes a Default or an Event of Default.
Very truly yours,
ELECTRIC LIGHTWAVE, INC.
By___________________________
Title:
*** Exclude bracketed text if the proposed A Borrowing is the
initial Borrowing under the Credit Agreement.
Form of Notice of A Borrowing
EXHIBIT B-2
NOTICE OF B BORROWING
Citibank, N.A., as Administrative
Agent for the Lenders parties
to the Credit Agreement
referred to below
1 Court Square, 7th Floor, Zone 7
Long Island City, New York 11120
Attention: Kim Coley
[Date]
Ladies and Gentlemen:
The undersigned, Electric Lightwave, Inc., refers to the Credit
Agreement, dated as of November 21, 1997 (the "Credit Agreement", the terms
defined therein being used herein as therein defined), among the undersigned,
the Guarantors referred to therein, certain Lenders parties thereto and
Citibank, N.A., as Administrative Agent for said Lenders, and hereby gives you
notice pursuant to Section 2.03 of the Credit Agreement that the undersigned
hereby requests a B Borrowing under the Credit Agreement, and in that connection
sets forth the terms on which such B Borrowing (the "Proposed B Borrowing") is
requested to be made:
(A) Date of B Borrowing _____________________
(B) Amount of B Borrowing _____________________
(C) Maturity Date _____________________
(D) Interest Rate Basis _____________________
(E) Interest Payment Date(s) _____________________
(F) _______________________ _____________________
(G) _______________________ _____________________
(H) _______________________ _____________________
The undersigned hereby certifies that the following statements
are true on the date hereof, and will be true on the date of the Proposed B
Borrowing:
(a) the representations and warranties contained in Article IV
[(other than Sections 4.03 and 4.06]* are correct, before and after
giving effect to the Proposed B Borrowing and to the application of the
proceeds therefrom, as though made on and as of such date;
* Exclude bracketed text if the proposed B Borrowing is the
initial Borrowing under the Credit Agreement.
Form of Notice of A Borrowing
- 2 -
(b) no event has occurred and is continuing, or would result
from the Proposed B Borrowing or from the application of the proceeds
therefrom, which constitutes a Default or an Event of Default; and
(c) the aggregate amount of the Proposed B Borrowing and all
other Borrowings to be made on the same day under the Credit Agreement
is within the aggregate amount of the unused Commitments of the
Lenders.
The undersigned hereby confirms that the Proposed B Borrowing
is to be made available to it in accordance with Section 2.03(a)(v) of the
Credit Agreement.
Very truly yours,
ELECTRIC LIGHTWAVE, INC.
By________________________
Title:
Form of Notice of B Borrowing
EXHIBIT C
ASSIGNMENT AND ACCEPTANCE
Dated ____________ __, _____
Reference is made to the Credit Agreement dated as of November
21, 1997 (the "Credit Agreement") among Electric Lightwave, Inc., a Delaware
corporation (the "Borrower"), the Guarantors (as defined in the Credit
Agreement), the Lenders (as defined in the Credit Agreement) and Citibank, N.A.,
as Administrative Agent for the Lenders (the "Administrative Agent"). Terms
defined in the Credit Agreement are used herein with the same meaning.
___________________(the "Assignor") and _________________ (the
"Assignee") agree as follows:
1. The Assignor hereby sells and assigns to the Assignee, and
the Assignee hereby purchases and assumes from the Assignor, that interest in
and to all of the Assignor's rights and obligations under the Credit Agreement
as of the date hereof [(other than in respect of B Advances and B Notes)]* which
represents the percentage interest specified on Schedule 1 of all outstanding
rights and obligations under the Credit Agreement [(other than in respect of B
Advances and B Notes)]1, including, without limitation, such interest in the
Assignor's Commitment, the A Advances and B Advances owing to the Assignor, and
the A Note[s] and B Note[s] held by the Assignor. After giving effect to such
sale and assignment, the Assignee's Commitment and the amount of the A Advances
and B Advances owing to the Assignee will be as set forth in Section 2 of
Schedule 1.
2. The Assignor (i) represents and warrants that it is the
legal and beneficial owner of the interest being assigned by it hereunder and
that such interest is free and clear of any adverse claim; (ii) makes no
representation or warranty and assumes no responsibility with respect to any
statements, warranties or representations made in or in connection with the
Credit Agreement or the execution, legality, validity, enforceability,
genuineness, sufficiency or value of the Credit Agreement or any other
instrument or document furnished pursuant thereto; (iii) makes no representation
or warranty and assumes no responsibility with respect to the financial
condition of the Borrower or the performance or observance by the Borrower of
any of its obligations under the Credit Agreement or any other instrument or
document furnished pursuant thereto; and
* Delete bracketed text if B Advances are covered by this
Assignment and Acceptance.
Form of Notice of B Borrowing
- 2 -
(iv) attaches the A Note[s] and B Note[s] referred to in paragraph 1 above and
requests that the Administrative Agent exchange such Note[s] for (X) a new A
Note to the order of the Assignee in an amount equal to the Commitment assumed
by it pursuant hereto and a new A Note to the order of the Assignor in an amount
equal to the Commitment retained by it under the Credit Agreement and (Y) new
B Note or Notes to the order of the Assignee in an amount equal to the principal
amount of the B Advances (if any) acquired by it pursuant hereto and, if the
Assignor has retained a portion of such B Advances, new B Note or Notes to the
order of the Assignor in an amount equal to the principal amount of the B
Advances retained by it under the Credit Agreement, in each case specified on
Schedule 1 hereto.
3. The Assignee (i) confirms that it has received a copy of
the Credit Agreement, together with copies of the financial statements referred
to in Section 4.01 thereof and such other documents and information as it has
deemed appropriate to make its own credit analysis and decision to enter into
this Assignment and Acceptance; (ii) agrees that it will, independently and
without reliance upon the Administrative Agent, the Assignor or any other Lender
and based on such documents and information as it shall deem appropriate at the
time, continue to make its own credit decisions in taking or not taking action
under the Credit Agreement; (iii) confirms that it is an Eligible Assignee; (iv)
appoints and authorizes the Administrative Agent to take such action as
administrative agent on its behalf and to exercise such powers under the Credit
Agreement as are delegated to the Administrative Agent by the terms thereof,
together with such powers as are reasonably incidental thereto; (v) agrees that
it will perform in accordance with their terms all of the obligations which by
the terms of the Credit Agreement are required to be performed by it as a
Lender; [and] (vi) specifies as its Domestic Lending Office (and address for
notices) and Eurodollar Lending Office the offices set forth beneath its name on
the signature pages hereof [and (vii) attaches the forms prescribed by the
Internal Revenue Service of the United States certifying as to the Assignee's
status for purposes of determining exemption from United States withholding
taxes with respect to all payments to be made to the Assignee under the Credit
Agreement and the Notes or such other documents as are necessary to indicate
that all such payments are subject to such rates at a rate reduced by an
applicable tax treaty].**
4. Following the execution of this Assignment and Acceptance
** If the Assignee is organized under the laws of a
jurisdiction outside the United States.
Form of Assignment and Acceptance
- 3 -
by the Assignor and the Assignee and the consent of the Borrower (to the extent
required pursuant to Section 9.07 of the Credit Agreement), it will be delivered
to the Administrative Agent for acceptance and recording by the Administrative
Agent. The effective date of this Assignment and Acceptance shall be the date of
acceptance thereof by the Administrative Agent, unless otherwise specified on
Schedule 1 hereto (the "Effective Date").
5. Upon such acceptance and recording by the Administrative
Agent, as of the Effective Date, (i) the Assignee shall be a party to the Credit
Agreement and, to the extent provided in this Assignment and Acceptance, have
the rights and obligations of a Lender thereunder and (ii) the Assignor shall,
to the extent provided in this Assignment and Acceptance, relinquish its rights
and be released from its obligations under the Credit Agreement.
6. Upon such acceptance and recording by the Administrative
Agent, from and after the Effective Date, the Administrative Agent shall make
all payments under the Credit Agreement and the Notes in respect of the interest
assigned hereby (including, without limitation, all payments of principal,
interest and Facility Fees with respect thereto) to the Assignee. The Assignor
and Assignee shall make all appropriate adjustments in payments under the Credit
Agreement and the Notes for periods prior to the Effective Date directly between
themselves.
7. This Assignment and Acceptance shall be governed by, and
construed in accordance with, the law of the State of New York.
IN WITNESS WHEREOF, the parties hereto have caused this
Assignment and Acceptance to be executed by their respective officers thereunto
duly authorized, as of the date first above written, such execution being made
on Schedule 1 hereto.
Form of assignment and Acceptance
SCHEDULE 1
to
ASSIGNMENT AND ACCEPTANCE
Percentage assigned to Assignee ______________%
Assignee's Commitment $______________
Aggregate outstanding principal
amount of A Advances assigned $______________
Principal Amount of A Note
payable to Assignee $______________
Principal Amount of A Note
payable to Assignor $______________
Aggregate outstanding principal
amount of B Advances assigned $______________
Principal Amount of B Note
payable to Assignee $______________
Principal Amount of B Note
payable to Assignor $______________
Effective Date (if other than
date of acceptance by
Administrative Agent)* __________ __, _____
[NAME OF ASSIGNOR], as Assignor
By______________________________
Title:
[NAME OF ASSIGNEE], as Assignee
By______________________________
Title:
Domestic Lending Office:
Eurodollar Lending Office:
Form of Assignment and Acceptance
- 2 -
* This date should be no earlier than the date of acceptance by the
Administrative Agent.
Form of Assignment and Acceptance
- 3 -
Accepted this ____ day
of _______, _____
CITIBANK, N.A., as
Administrative Agent
By_____________________
Title:
CONSENTED TO:
ELECTRIC LIGHTWAVE, INC.
By_____________________
Title:
Form of Assignment and Acceptance
EXHIBIT D
DESIGNATION AGREEMENT
Dated _____________ __, _____
Reference is made to the Credit Agreement dated as of November
21, 1997 (the "Credit Agreement") among Electric Lightwave, Inc., a Delaware
corporation (the "Borrower"), the Guarantors (as defined in the Credit
Agreement), the Lenders (as defined in the Credit Agreement) and Citibank, N.A.,
as Administrative Agent for the Lenders (the "Administrative Agent"). Terms
defined in the Credit Agreement are used herein with the same meaning.
_________________ (the "Designator") and ________________ (the
"Designee") agree as follows:
1. The Designator hereby designates the Designee, and the
Designee hereby accepts such designation, to have a right to make B Advances
pursuant to Section 2.03 of the Credit Agreement.
2. The Designator makes no representation or warranty and
assumes no responsibility with respect to (i) any statements, warranties or
representations made in or in connection with the Credit Agreement or the
execution, legality, validity, enforceability, genuineness, sufficiency or value
of the Credit Agreement or any other instrument or document furnished pursuant
thereto and (ii) the financial condition of the Borrower or the performance or
observance by the Borrower of any of its obligations under the Credit Agreement
or any other instrument or document furnished pursuant thereto.
3. The Designee (i) confirms that it has received a copy of
the Credit Agreement, together with copies of the financial statements referred
to in Section 4.01 thereof and such other documents and information as it has
deemed appropriate to make its own credit analysis and decision to enter into
this Designation Agreement; (ii) agrees that it will, independently and without
reliance upon the Administrative Agent, the Designator or any other Lender and
based on such documents and information as it shall deem appropriate at the
time, continue to make its own credit decisions in taking or not taking action
under the Credit Agreement; (iii) confirms that it is a Designated Bidder; (iv)
appoints and authorizes the Administrative Agent to take such action as
administrative agent on its behalf and to exercise such powers under the Credit
Agreement as are delegated to the Administrative Agent by the terms thereof,
together with such powers as are reasonably incidental thereto; (v) agrees that
it will perform in accordance with their terms all of the obligations which by
the terms of the Credit Agreement are required to be performed by it as a
Form of Assignment and Acceptance
- 2 -
Lender; and (vi) specifies as its Applicable Lending Office with respect to B
Advances (and address for notices) the offices set forth beneath its name on the
signature pages hereof.
4. Following the execution of this Designation Agreement by
the Designator and its Designee, it will be delivered to the Administrative
Agent for acceptance and recording by the Administrative Agent. The effective
date of this Designation Agreement shall be the date of acceptance thereof by
the Administrative Agent, unless otherwise specified on the signature page
hereto (the "Effective Date").
5. Upon such acceptance and recording by the Administrative
Agent, as of the Effective Date, the Designee shall be a party to the Credit
Agreement with a right to make B Advances as a Lender pursuant to Section 2.03
of the Credit Agreement and the rights and obligations of a Lender related
thereto.
6. This Designation Agreement shall be governed by, and
construed in accordance with, the laws of the State of New York.
Form of Designation Agreement
- 3 -
IN WITNESS WHEREOF, the parties hereto have caused this
Designation Agreement to be executed by their respective officers thereunto duly
authorized, as of the date first above written.
Effective Date*: _____________ __, _____
[NAME OF DESIGNATOR]
By_______________________
Title:
[NAME OF DESIGNEE]
By_______________________
Title:
Applicable Lending
Office (and address
for notices)
--------------------------
--------------------------
--------------------------
--------------------------
Accepted this ____ day
of _____________, _____
CITIBANK, N.A., as
Administrative Agent
By______________________
Title:
* This date should be no earlier than the date of acceptance by the
Administrative Agent.
Form of Designation Agreement
EXHIBIT E
[Form of Opinion of Counsel of the Borrower]
________, 1997
To the Banks party to the
Credit Agreement referred to
below
Citibank, N.A., as Administrative
Administrative Agent
399 Park Avenue
New York, New York 10043
Ladies and Gentlemen:
This opinion is rendered in connection with the Credit Agreement (the
"Credit Agreement") dated as of November 21, 1997, among the Electric Lightwave,
Inc. (the "Borrower"), Citizens Utilities Company (the "Parent Guarantor"), the
Subsidiary Guarantors referred to therein, the Lenders referred to therein and
Citibank, N.A., as Administrative Agent, providing for loans to be made by said
Lenders to the Borrower in an aggregate principal amount not exceeding
$400,000,000. Terms defined in the Credit Agreement are used herein as therein
defined.
I am the General Counsel of the Parent Guarantor and, in that capacity
in connection with the foregoing, I have examined the Credit Agreement and the
Notes. I have also examined originals or copies, certified or otherwise
identified to my satisfaction, of such documents, corporate records,
certificates of public officials and other instruments, and have conducted such
other investigations of fact and law, as I have deemed necessary or advisable
for purposes of this opinion.
Based on the foregoing, I am of the opinion that:
1. Each of the Guarantor and the Principal Subsidiaries (a) is a
corporation duly organized, validly existing and in good
standing under the laws of the state of its incorporation, (b)
has the requisite power and authority to own its property and
assets and to carry on its business as now conducted and (c)
is qualified to do business in every jurisdiction where such
qualification is required, except where the failure so to
qualify would not have a Material Adverse Effect.
2. The execution, delivery and performance by each Obligor of
the Credit Agreement and (in the case of the Borrower) the
Notes(a) have been duly authorized by all necessary corporate
action on the part of such Obligor and do not and will not
Form of Designation Agreement
- 2 -
require the consent or approval of shareholders of such
Obligor, other than such consents as have been obtained,
(b) will not violate (i) any provision of law, statute,
rule or regulation or the Certificate of Incorporation
or the By-Laws of any Obligor or (ii) any order of any
court or of any other agent of government binding upon any
Obligor, (c) will not violate, 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 indenture, agreement or
other instrument to which the Parent Guarantor, any Sub-
sidiary Guarantor, the Borrower or any other Principal
Subsidiary is a party or by which the Parent Guarantor, any
Subsidiary Guarantor, the Borrower or any other Principal
Subsidiary or any of its properties or assets are or may be
bound and (d) will not result in the creation or imposition
of any lien, charge or encumbrance of any nature whatsoever
upon any property or assets of the Parent Guarantor, any
Subsidiary Guarantor, the Borrower or any other Principal
Subsidiary.
3. All consents or approvals of, or other actions by, any
governmental agency, authority or regulatory body required in
connection with the execution, delivery and performance by
each Obligor of the Credit Agreement and (in the case of the
Borrower) the Notes have been duly obtained and are in full
force and effect, without amendment or modification, and are
not the subject of any pending or threatened proceedings
seeking to amend, modify, or rescind all or any portion of the
terms thereof, or any stay.
4. The Credit Agreement and (in the case of the Borrower) the
Notes have been duly executed and delivered by each Obligor
and constitute legal, valid and binding obligations of each
Obligor stated to be a party thereto, enforceable against such
Obligor in accordance with their terms, except as such
enforceability may be limited by applicable bankruptcy,
reorganization, insolvency, moratorium and other laws
affecting the rights of creditors generally and general
principles of equity.
5. There are not any actions, suits, or proceedings at law or in
equity or by or before any governmental instrumentality,
regulatory authority, or other agency now pending or, to the
best of my knowledge, threatened against the Parent Guarantor
or any Subsidiary (a) which involve the Credit Agreement or
Opinion of Counsel of the Borrower
- 3 -
any of the transactions contemplated thereby or (b) which, if
adversely determined, could reasonably be expected to have a
Material Adverse Effect, or (ii) impair in any respect the
validity or enforceability of, or the ability of any Obligor
to perform its obligations under, the Credit Agreement or the
Notes.
6. Neither the Parent Guarantor nor any Subsidiary is in
violation of any law, or in default with respect to any
judgment, writ, injunction, decree, rule, or regulation of any
court or governmental agency or instrumentality, where such
violation or default could have (i) a Material Adverse Effect,
or (ii) impair in any respect the validity or enforceability
of, or the ability of any Obligor to perform its obligations
under, the Credit Agreement or the Notes.
7. Neither the Parent Guarantor nor any Subsidiary is an
"investment company" as defined in or subject to regulation
under the Investment Company Act of 1940, as amended. Neither
the Parent Guarantor nor the Subsidiary is a "holding company"
as defined in or subject to regulation under the Public
Utility Holding Company Act of 1935, as amended.
Very truly yours,
Opinion of Counsel of the Borrower
EXHIBIT F
[Form of Opinion of Special New York Counsel
to the Administrative Agent]
November 21, 1997
To the Banks party to the
Credit Agreement referred to
below
Citibank, N.A., as
Administrative Agent
399 Park Avenue
New York, New York 10043
Ladies and Gentlemen:
We have acted as special New York counsel to Citibank, N.A.,
as Administrative Agent, in connection with the Credit Agreement dated as of
November 21, 1997 (the "Credit Agreement") among Electric Lightwave, Inc. (the
"Borrower"), the guarantors named therein, the lenders named therein and
Citibank, N.A., as Administrative Agent, providing for loans to be made by said
lenders to the Borrower in an aggregate principal amount not exceeding
$400,000,000. Terms defined in the Credit Agreement are used herein as defined
therein. This opinion is being delivered pursuant to Section 3.01(f) of the
Credit Agreement.
In rendering the opinions expressed below, we have assumed,
with respect to all of the documents referred to in this opinion letter, that:
(i) such documents have been duly authorized by, have
been duly executed and delivered by, and (except to
the extent set forth in the opinions below as to the
Borrower) constitute legal, valid, binding and
enforceable obligations of, all of the parties to
such documents;
(ii) all signatories to such documents have been duly authorized; and
(iii) all of the parties to such documents are duly
organized and validly existing and have the power and
authority (corporate or other) to execute, deliver
and perform such documents.
Opinion of Special New York Counsel
to the Administrative Agent
- 2 -
Based upon and subject to the foregoing and subject also to
the comments and qualifications set forth below, and having considered such
questions of law as we have deemed necessary as a basis for the opinions
expressed below, we are of the opinion that the Credit Agreement constitutes,
and each of the Notes when executed and delivered for value will constitute, the
legal, valid and binding obligation of each Obligor stated to be a signatory
thereto, enforceable against such Obligor in accordance with its terms, except
as may be limited by bankruptcy, insolvency, reorganization, moratorium,
fraudulent conveyance or transfer or other similar laws relating to or affecting
the rights of creditors generally and except as the enforceability thereof is
subject to the application of general principles of equity (regardless of
whether considered in a proceeding in equity or at law), including, without
limitation, (a) the possible unavailability of specific performance, injunctive
relief or any other equitable remedy and (b) concepts of materiality,
reasonableness, good faith and fair dealing.
The foregoing opinions are subject to the following comments
and qualifications:
(A) The enforceability of Section 9.04(b) of the Credit
Agreement may be limited by laws limiting the enforceability of
provisions exculpating or exempting a party from, or requiring
indemnification of a party for, its own action or inaction, to the
extent such action or inaction involves gross negligence, recklessness
or wilful or unlawful conduct.
(B) The enforceability of provisions in the Credit Documents
to the effect that terms may not be waived or modified except in
writing may be limited under certain circumstances.
(C) We express no opinion as to (i) the effect of the laws of
any jurisdiction in which any Lender is located (other than the State
of New York) that limit the interest, fees or other charges such Lender
may impose, (ii) the second sentence of Section 2.16 of the Credit
Agreement, (iii) the second sentence of Section 9.08 of the Credit
Agreement, insofar as such sentence relates to the subject matter
jurisdiction of the United States District Court for the Southern
District of New York to adjudicate any controversy related to the
Credit Documents, (iv) the waiver of inconvenient forum set forth in
Section 9.08 of the Credit Agreement with respect to proceedings in the
United States District Court for the Southern District of New York and
(v) Section 9.09 of the Credit Agreement.
Opinion of Special New York Counsel
to the Administrative Agent
- 3 -
(D) Clause (iii) of the second sentence of Section 10.02 of
the Credit Agreement may not be enforceable to the extent that the
Guaranteed Obligations are materially altered.
(E) We express no opinion as to the applicability to the
obligations of any Subsidiary Guarantor (or the enforceability of such
obligations) of Section 548 of the Bankruptcy Code or any other
provision of law relating to fraudulent conveyances, transfers or
obligations.
The foregoing opinions are limited to matters involving the
Federal laws of the United States and the law of the State of New York, and we
do not express any opinion as to the laws of any other jurisdiction.
This opinion letter is, pursuant to Section 3.01(f) of the
Credit Agreement, provided to you by us in our capacity as special New York
counsel to the Administrative Agent and may not be relied upon by any person for
any purpose other than in connection with the transactions contemplated by the
Credit Agreement without, in each instance, our prior written consent.
Very truly yours,
Opinion of Special New York Counsel
to the Administrative Agent
* Reflects change from executed original.
** For Eurodollar Rate Advances only.
*** Exclude bracketed text if the proposed A Borrowing is the initial
Borrowing under the Credit Agreement.
* Exclude bracketed text if the proposed B Borrowing is the initial
Borrowing under the Credit Agreement.
* Delete bracketed text if B Advances are covered by this Assignment
and Acceptance.
** If the Assignee is organized under the laws of a jurisdiction outside
the United States.