<PAGE>
<PAGE> 1
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
FORM 10 - Q
/X/ QUARTERLY REPORT PURSUANT TO SECTION 13 or 15(d) OF THE
SECURITIES EXCHANGE ACT OF 1934
For the Quarterly Period Ended September 30, 1997
or
/ / TRANSITION REPORT PURSUANT TO SECTION 13 or 15(d) OF THE
SECURITIES EXCHANGE ACT OF 1934
For the transition period from to
Commission file number 1-7530
Wisconsin Gas Company
------------------------------------------------------
(Exact name of registrant as specified in its charter)
Wisconsin 39-0476515
-------------------------------- --------------------
(State or other jurisdiction of (I.R.S. Employer
incorporation or organization) Identification No.)
626 East Wisconsin Avenue
Milwaukee, Wisconsin 53202
--------------------------------------- ----------
(Address of principal executive office) (Zip Code)
414-385-7000
----------------------------------------------------
(Registrant's telephone number, including area code)
Indicate by check mark whether the registrant (1) has filed
all reports required to be filed by Section 13 or 15 (d) of the
Securities Exchange Act of 1934 during the preceding 12 months
(or for such shorter period that the registrant was required to
file such reports), and (2) has been subject to such filing
requirements for the past 90 days.
Yes X No
Indicate the number of shares outstanding of each of the
issuer's classes of common stock, as of the latest practicable
date.
Class Outstanding at October 21, 1997
- -------------------------- -------------------------------
Common Stock, $8 Par Value 1,125
<PAGE>
<PAGE> 2
INTRODUCTION
Wisconsin Gas Company ("Wisconsin Gas" or "Company"), a natural
gas distribution public utility, is a Wisconsin corporation and a
wholly-owned subsidiary of WICOR, Inc. ("WICOR"), a diversified
holding company.
CONTENTS
PAGE
PART I. Financial Information 1
Management's Discussion and Analysis of
Interim Financial Statements 2-3
Financial Statements of Wisconsin Gas Company (Unaudited):
Statements of Income for the Three and Nine
Months Ended September 30, 1997 and 1996 4
Balance Sheets as of September 30, 1997 and
December 31, 1996 5-6
Statements of Cash Flows for the Nine
Months Ended September 30, 1997 and 1996 7
Notes to Financial Statements 8
PART II. Other Information 9
Signatures 10
<PAGE>
<PAGE> 3
Part I - Financial Information
Financial Statements
The financial statements included herein have been prepared
without audit pursuant to the rules and regulations of the
Securities and Exchange Commission. Certain information and
footnote disclosures normally included in financial statements
prepared in accordance with generally accepted accounting
principles have been condensed or omitted pursuant to such rules
and regulations, although management believes that the
disclosures are adequate to make the information presented not
misleading. These condensed financial statements should be read
in conjunction with the audited financial statements and the
notes thereto included in the Company's Annual Report on Form 10-
K for the year ended December 31, 1996.
In the opinion of management, the information furnished reflects
all adjustments, which in all circumstances were normal and
recurring, necessary for a fair presentation of the results of
operations for the interim periods.
Because of seasonal factors, the results of operations for the
interim periods presented are not necessarily indicative of the
results to be expected for the full calendar year.
<PAGE>
<PAGE> 4
Management's Discussion and Analysis
of Interim Financial Statements of
Wisconsin Gas Company
Results of Operations
- ---------------------
The Company typically incurs a loss in the third quarter due to
the seasonal nature of the gas distribution utility business.
The net loss for the third quarter of 1997 was $6.6 million, or
4% less than the net loss for the 1996 third quarter. Net income
for the nine months ended September 30, 1997 was $17.7 million,
or 11% less than the same period of last year. The following
factors had a significant effect on the results of operations
during the three- and nine-month periods ended September 30,
1997.
The decline in the net loss for the third quarter resulted
primarily from decreased operating and maintenance expenses and
lower interest charges. However, decreased gas margins,
resulting from lower firm sales volumes and a voluntary $3
million annual rate reduction effective November 1, 1996 (see
"Regulatory Matters" below), partially offset the benefits from
the cost-management efforts. The decrease in 1997 year-to-date
net income was due to a combination of weather that was 5% warmer
than last year and the 1996 rate reduction, the impact of which
was offset in part by lower operating expenses and interest
charges.
Revenues, margins and volumes are summarized below. Margin,
defined as revenues less cost of gas sold, is a better
comparative performance indicator than revenues because the mix
of volumes between sales and transportation service affects
revenues but not margin. In addition, changes in the cost of gas
sold are flowed through to revenue under a gas adjustment clause
with no resulting effect on margin. The following tables set
forth margin and volume data for each of the periods set forth
below.
<PAGE>
<PAGE> 5
<TABLE>
<CAPTION>
Three Nine
Months Ended Months Ended
September 30, September 30,
-------------- % -------------- %
(Millions of Dollars) 1997 1996 Change 1997 1996 Change
- --------------------- ------ ------ ------ ------ ------ ------
<S> <C> <C> <C> <C> <C> <C>
Gas Sales Revenues $ 54.1 $ 69.0 (22) $361.9 $385.7 (6)
Cost of Gas Sold 36.2 49.2 (26) 241.7 249.5 (3)
------ ------ ------ ------
Gas Sales Margin 17.9 19.8 (10) 120.2 136.2 (12)
Gas Transport Margin 4.4 2.8 57 16.1 9.3 73
------ ------ ------ ------
Total Margin $ 22.3 $ 22.6 (1) $136.3 $145.5 (6)
====== ====== ====== ======
(Millions of Therms)
- --------------------
Sales Volumes
Firm 53.0 56.9 (7) 541.8 605.2 (10)
Interruptible 10.7 31.8 (66) 58.6 152.8 (62)
Transportation Volume 88.1 60.4 46 309.2 183.1 69
------ ------ ------ ------
Total Throughput 151.8 149.1 2 909.6 941.1 (3)
====== ====== ====== ======
Degree Days (Normal:
3rd Qtr. = 155
Nine Months = 4,543) 162 123 32 4,692 4,956 (5)
====== ====== ====== ======
</TABLE>
The decrease in firm sales volumes for the third quarter of 1997
was caused principally by firm customers switching from sales to
transportation service. Transportation volumes increased mainly
because more customers purchased gas from sources other than
Wisconsin Gas and transported the volumes over the Wisconsin Gas
distribution system. Historically, the movement to
transportation from gas sales had no impact on margin. Effective
November 1, 1997, a slightly lower margin rate is in effect for
transportation-only customers. The impact on total Company
margin is expected to be immaterial. For the nine months ended
September 30, 1997, the total margin decrease was largely the
result of warmer weather and a $3.0 million rate reduction in
November 1996. The weather was 3% colder than normal during the
first nine months of 1997 and 5% warmer than the same period in
1996.
<PAGE>
<PAGE> 6
Operating and maintenance expenses decreased by $1.2 million, or
6%, during the third quarter of 1997 compared to the third
quarter of 1996. Year-to-date operating and maintenance expenses
decreased $3.9 million, or 5%, compared to the same period of
last year. The decrease for the quarter and year-to-date periods
was due mainly to lower labor and benefit expenses, which
included a reduction in post-retirement benefit expenses
reflecting improved health care cost experience. These decreases
were partially offset by an increase in amounts paid for outside
services.
Depreciation expense for the nine months ended September 30,
1997, decreased by $1.2 million, or 5%, compared with the same
period of last year. The decrease was due to the one-time impact
of new depreciation rates permitted by the Public Service
Commission of Wisconsin ("PSCW") in 1996.
Interest expense decreased by $0.1 million, or 4%, and $0.3
million, or 3%, for the three- and nine-months ended September
30, 1997, compared with the similar periods of 1996, due
primarily to slightly lower borrowing levels.
Income tax expense was $2.1 million lower for the first nine
months of 1997, compared with the same period last year,
reflecting the decrease in pre-tax income.
Financial Condition
- -------------------
Cash flow from operations for the nine months ended September 30,
1997, increased by $8.1 million, or 13%, from the comparable
period in 1996. The decrease was the result of higher recovered
gas costs in the first half of 1996 due to colder weather.
Pipeline refunds, which will be refunded to customers during the
fourth quarter of 1997, partially offset the decrease in cash
flow from operations. Due to the seasonal nature of the energy
business, accrued revenues, accounts receivable and accounts
payable are higher in the heating season than in the warmer
months.
The Company anticipates additional short-term borrowing during
the fourth quarter of 1997 to finance working capital needs
primarily related to gas storage and the financing of accounts
receivable during the heating season. The Company has existing
lines of credit to satisfy this working capital need.
Cash flow from operations exceeded capital expenditures and
dividend requirements for the first nine months in both 1997 and
1996.
<PAGE>
<PAGE> 7
Capital expenditures for the nine months ended September 30,
1997, remained relatively flat compared to the same period in
1996.
Regulatory Matters
- ------------------
The Company voluntarily reduced its rates by $3.0 million on an
annualized basis effective November 1, 1996. With this
reduction, Wisconsin Gas's rates recover $7.5 million per year
less than the maximum margin allowed by the PSCW's November 1994
rate order. The Company announced a further $1.5 million rate
reduction on an annualized basis effective November 1, 1997. The
Company has the ability to raise or lower margin rates within a
specified range on a quarterly basis.
On November 4, 1997, the PSCW granted the Company's request for a
one-year extension of the Performance-based Alternative
Ratemaking Mechanism through October 31, 1999.
<PAGE>
<PAGE> 8
WISCONSIN GAS COMPANY
Statements of Operation (Unaudited)
<TABLE>
<CAPTION>
Three Months Ended Nine Months Ended
September 30, September 30,
-------------------------- --------------------------
1997 1996 1997 1996
------------ ------------- ------------ -------------
(Thousands of Dollars)
<S> <C> <C> <C> <C>
Operating Revenues $ 58,537 $ 71,790 $ 378,059 $ 394,990
------------ ------------- ------------ -------------
Operating Expenses:
Cost of gas sold 36,205 49,198 241,721 249,474
Operations 17,530 18,671 61,883 65,953
Maintenance 2,341 2,439 6,759 6,557
Depreciation 7,989 7,887 23,416 24,614
Taxes, other than income taxes 2,307 2,176 7,091 7,044
------------ ------------ ------------ ------------
66,372 80,371 340,870 353,642
------------ ------------ ------------ ------------
Operating (Loss) Income (7,835) (8,581) 37,189 41,348
------------ ------------ ------------ ------------
Interest Expense 2,967 3,085 9,100 9,356
Other Income and (Expenses), net 247 520 470 857
------------ ------------ ------------ ------------
(Loss) Income Before Income Taxes (10,555) (11,146) 28,559 32,849
Income Tax (Benefit) Provision (3,979) (4,269) 10,888 12,958
------------ ------------ ------------ ------------
Net (Loss) Income $ (6,576) $ (6,877) $ 17,671 $ 19,891
============ ============ ============ ============
</TABLE>
The accompanying notes are an integral part of these statements.
<PAGE>
<PAGE> 9
WISCONSIN GAS COMPANY
Balance Sheets
<TABLE>
<CAPTION>
September 30,
1997 December 31,
(Unaudited) 1996
----------- ------------
(Thousands of Dollars)
<S> <C> <C>
Assets
- ------
Property, Plant and Equipment, at cost $ 791,427 $ 786,486
Less - Accumulated depreciation 413,531 409,151
----------- ------------
377,896 377,335
----------- ------------
Current Assets:
Cash and cash equivalents 4,097 8,960
Accounts receivable, less allowance
for doubtful accounts of $11,165
and $12,363, respectively 44,598 73,540
Accounts receivable - intercompany, net 754 76
Accrued utility revenues 5,252 54,382
Materials and supplies, at weighted average cost 3,764 3,098
Gas in storage, at weighted average cost 49,386 32,684
Deferred income taxes 17,879 17,879
Prepaid taxes 4,988 6,411
Other 1,307 1,668
----------- ------------
132,025 198,698
----------- ------------
Deferred Charges and Other:
Regulatory assets 98,290 101,808
Systems development costs 18,831 23,052
Prepaid pension costs 33,937 30,112
Other 7,363 7,372
----------- ------------
158,421 162,344
----------- ------------
$ 668,342 $ 738,377
=========== ============
</TABLE>
The accompanying notes are an integral part of these statements.
<PAGE>
<PAGE> 10
WISCONSIN GAS COMPANY
Balance Sheets
(continued)
<TABLE>
<CAPTION>
September 30,
1997 December 31,
(Unaudited) 1996
----------- ------------
<S> <C> <C>
Capitalization and Liabilities
- ------------------------------
Capitalization:
Common stock $ 9 $ 9
Other paid-in capital 119,858 119,095
Retained earnings 89,845 88,670
Long-term debt 150,606 152,453
----------- ------------
360,318 360,227
----------- ------------
Current Liabilities:
Accounts payable 39,157 64,548
Refundable gas costs 19,195 31,545
Short-term borrowings 31,525 65,500
Current portion of long-term debt 2,000 2,000
Accrued payroll and benefits 10,685 8,116
Accrued taxes 3,280 712
Other 6,866 4,334
----------- ------------
112,708 176,755
----------- ------------
Deferred Credits and Other:
Regulatory liabilities 58,598 61,749
Deferred income taxes 35,569 35,569
Postretirement benefit obligation 49,507 51,359
Environmental remediation costs 35,578 36,222
Unamortized investment tax credit 7,019 7,265
Other 9,045 9,231
----------- ------------
195,316 201,395
----------- ------------
$ 668,342 $ 738,377
=========== ============
</TABLE>
The accompanying notes are an integral part of these statements.
<PAGE>
<PAGE> 11
WISCONSIN GAS COMPANY
Statements of Cash Flows (Unaudited)
<TABLE>
<CAPTION>
Nine Months Ended
September 30,
----------------------
1997 1996
--------- ---------
(Thousands of Dollars)
<S> <C> <C>
Operations:
Net income $ 17,671 $ 19,891
Adj. to reconcile net income to net cash flows:
Depreciation and amortization 29,413 30,837
Deferred income taxes - (247)
Change in:
Receivables 78,072 69,895
Gas in storage (16,702) (24,133)
Other current assets (983) (10,076)
Accounts payable (25,391) (16,562)
Accrued taxes 3,991 1,186
Refundable gas costs (12,350) (6,555)
Accrued payroll and benefits 2,569 4,013
Other current liabilities 2,532 1,057
Other non-current assets and liabilities (7,222) (5,781)
--------- ---------
71,600 63,525
--------- ---------
Investment Activities:
Capital expenditures (24,228) (24,659)
Other, net 240 159
--------- ---------
(23,988) (24,500)
--------- ---------
Financing Activities:
Change in short-term borrowings (33,975) (26,500)
Reduction of long-term debt (2,000) (4,000)
Cash dividends paid to WICOR, Inc. (16,500) (15,000)
--------- ---------
(52,475) (45,500)
--------- ---------
Change in Cash and Cash Equivalents (4,863) (6,475)
Cash and Cash Equivalents at Beginning of Period 8,960 7,463
--------- ---------
Cash and Cash Equivalents at End of Period $ 4,097 $ 988
========= =========
</TABLE>
The accompanying notes are an integral part of these statements.
<PAGE>
<PAGE> 12
Notes to Financial Statements (Unaudited):
1) At September 30, 1997, Wisconsin Gas had total unsecured
lines of credit available from several banks of $120.0 million.
As of September 30, 1997, commercial paper totaling $31.5 million
was outstanding under these credit agreements with a weighted
average interest rate of 5.6%.
2) For purposes of the Statements of Cash Flows, income taxes
paid, net of refunds, and interest paid (excluding capitalized
interest) were as follows:
For the Nine Months
Ended September 30,
---------------------------
1997 1996
---------- ----------
(Thousands of Dollars)
Income taxes paid $ 11,235 $ 23,718
Interest paid $ 7,710 $ 7,725
3) Certain prior year financial statement amounts have been
restated to conform to their current year presentation.
<PAGE> 13
Part II - Other Information
Item 6. Exhibits and Reports on Form 8-K
(a) Exhibits
4.1 Revolving Credit Agreement dated as of August 6,
1997, among Wisconsin Gas Company and Citibank, N.A.,
as agent, Firstar Bank Milwaukee, N.A., Harris Trust
and Savings Bank and M&I Marshall & Illsley Bank.
27 Financial data schedule (EDGAR version only)
(b) Reports on Form 8-K. There were no reports on Form 8-K filed
by the Company during the third quarter of 1997.
<PAGE>
<PAGE> 14
SIGNATURES
Pursuant to the requirements of the Securities Exchange Act of
1934, the registrant has duly caused this report to be signed on
its behalf by the undersigned thereunto duly authorized.
WISCONSIN GAS COMPANY
Dated: October 31, 1997 By: /s/ Joseph P. Wenzler
------------------------
Joseph P. Wenzler
Vice President and Chief
Financial Officer
<PAGE>
<PAGE> 15
Wisconsin Gas Company
FORM 10-Q EXHIBIT INDEX
4.1 Revolving Credit Agreement dated as of August 6, 1997,
among Wisconsin Gas Company and Citibank, N.A., as
agent, Firstar Bank Milwaukee, N.A., Harris Trust and
Savings Bank and M&I Marshall & Illsley Bank.
27 Financial data schedule (EDGAR version only)
<PAGE> 1
EXHIBIT 4.1
REVOLVING CREDIT AGREEMENT
Dated as of August 6, 1997
WISCONSIN GAS COMPANY, a Wisconsin corporation (the
"Borrower"), CITIBANK, N.A., and the other banks named on the
signature pages hereof (the "Banks"), and CITIBANK, N.A.
("Citibank"), as administrative agent (the "Agent") for the
Lenders hereunder, hereby agree as follows:
I ARTICLE
DEFINITIONS AND ACCOUNTING TERMS
A. SECTION 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.
"A Borrowing" means a borrowing consisting of
simultaneous A Advances of the same Type made by each of the
Lenders pursuant to Section 2.01.
"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.
"Affiliate" means, with respect to any Person, any
other Person directly or indirectly controlling (including
but not limited to all directors and officers of such
Person), controlled by, or under direct or indirect common
control with such Person. A Person shall be deemed to
control another entity if such Person possesses, directly or
indirectly, the power to direct or cause the direction of
the management and policies of such entity, whether through
the ownership of voting securities, by contract, or
otherwise.
"Agent" has the meaning set forth in the preamble to
this Agreement.
"Agreement" means this Revolving Credit Agreement, as the
same may be amended or otherwise modified from time to time.
<PAGE> 2
"Applicable Fee Percentage" means, at all times during
which any Pricing Level set forth below is in effect, the
percentage set forth below next to such Pricing Level:
Pricing Level Applicable Fee Percentage
Pricing Level I 0.09%
Pricing Level II 0.10%
Pricing Level III 0.15%
Pricing Level IV 0.25%
A change in the Applicable Fee Percentage resulting from a
change in the Pricing Level shall become effective upon the
date of announcement of a change in the Moody's Rating or
the S&P Rating that results in a change in the Pricing
Level.
"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 Agent as its Applicable Lending Office
with respect to such B Advance.
"Applicable Margin" means, on any date of
determination (i) for a Base Rate Advance, 0.00% per annum,
and (ii) for a Eurodollar Rate Advance, at all times during
which any Pricing Level set forth below is in effect, a rate
per annum equal to the percentage set forth below next to
such Pricing Level:
Pricing Level Applicable Margin
Pricing Level I 0.16%
Pricing Level II 0.20%
Pricing Level III 0.25%
Pricing Level IV 0.50%
A change in the Applicable Margin resulting from a change in
the Pricing Level shall become effective upon the date of
announcement of a change in the Moody's Rating or the S&P
Rating that results in a change in the Pricing Level.
Notwithstanding the foregoing, upon the occurrence and
during the continuance of any Event of Default, the
Applicable Margin with respect to Base Rate Advances and
Eurodollar Rate Advances shall be increased by 2% per annum.
"Applicable Rate" means:
in the case of each Base Rate Advance, a rate per annum
equal at all times to the sum of the Base Rate in effect from
time to time plus the Applicable Margin in effect from time to
time; and
<PAGE> 3
a) in the case of each Eurodollar Rate Advance
comprising part of the same A Borrowing, a rate per annum
during each Interest Period equal at all times to the sum of
the Eurodollar Rate for such Interest Period plus the
Applicable Margin in effect from time to time during such
Interest Period.
"Assignment and Acceptance" means an assignment and
acceptance entered into by a Lender and an assignee of such
Lender, and accepted by the 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.
"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.
"Banks" has the meaning set forth in the preamble to
this Agreement.
"Base Rate" means, for any period, a fluctuating
interest rate per annum as shall be in effect from time to
time which rate per annum shall at all times be equal to the
higher of:
1. the rate of interest announced
publicly by Citibank in New York, New York, from time to
time, as Citibank's base rate; and
1. 1/2 of one percent per annum above the
Federal Funds Rate.
Each change in the Base Rate shall take effect concurrently
with any change in such base rate or the Federal Funds Rate.
"Base Rate Advance" means an A Advance which bears
interest as provided in Section 2.07(a).
"Borrower" has the meaning set forth in the preamble to
this Agreement.
<PAGE> 4
"Borrower's Account" means bank account no. 0030-2678
maintained by the Borrower with M&I Marshall & Ilsley Bank
(ABA No. 0750-0005-1), or such other bank account as may be
designated by the Borrower in a written notice to the Agent
and the Lenders.
"Borrowing" means an A Borrowing or a B Borrowing. Any
A Borrowing consisting of A Advances of a particular Type
may be referred to as being an A Borrowing of such "Type".
"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 Advances, on which dealings in U.S. dollar
deposits are carried on in the London interbank market.
"Citibank" has the meaning set forth in the preamble to
this Agreement.
"Closing" means the day upon which each of the
applicable conditions precedent enumerated in Section 3.01
shall be fulfilled to the satisfaction of, or waived with
the consent of, the Lenders, the Agent and the Borrower.
All transactions contemplated by the Closing shall take
place on a Business Day on or prior to August 6, 1997, at
the offices of King & Spalding, 120 West 45th Street, New
York, New York 10036, at 10:00 A.M., or such later Business
Day as the parties hereto may mutually agree.
"Code" means the Internal Revenue Code of 1986, as
amended from time to time, and the regulations promulgated
and rulings issued thereunder.
"Commitment" has the meaning specified in Section 2.01.
"Consolidated Debt" means, at any date of
determination, the aggregate amount of all Funded Debt and
Current Debt of the Borrower and its Consolidated
Subsidiaries as determined on such date on a consolidated
basis eliminating intercompany items.
"Consolidated Subsidiary" means any Subsidiary of the
Borrower whose accounts are or are required to be
consolidated with the accounts of the Borrower in accordance
with generally accepted accounting principles.
"Convert", "Conversion" and "Converted" each refers to
a conversion of A Advances of one Type into A Advances of
another Type or the selection of a new, or the renewal of
the same, Interest Period for Eurodollar Rate Advances
pursuant to Section 2.09 or 2.10.
<PAGE> 5
"Current Debt" means, for any Person at any date of
determination, all indebtedness of such Person of the type
described in clauses (i) through (vii) of the definition of
Indebtedness, other than Funded Debt, as of such date.
"Domestic Lending Office" means, with respect to any
Lender, the office of such Lender specified as its "Domestic
Lending Office" opposite its name on Schedule I hereto 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 Agent.
"ERISA" means the Employee Retirement Income Security
Act of 1974, as amended from time to time, and the
regulations promulgated and rulings issued thereunder.
"ERISA Affiliate" means any Person which for purposes
of Title IV of ERISA is a member of the Borrower's
controlled group, or under common control with the Borrower,
within the meaning of Section 414 of the Code, and the
regulations promulgated and rulings issued thereunder.
"ERISA Event" means (i) the occurrence of a reportable
event, within the meaning of Section 4043 of ERISA, unless
the 30-day notice requirement with respect thereto has been
waived by the PBGC; (ii) the provision by the administrator
of any Plan of a notice of intent to terminate such Plan,
pursuant to Section 4041(a)(2) of ERISA (including any such
notice with respect to a plan amendment referred to in
Section 4041(e) of ERISA); (iii) the cessation of operations
at a facility in the circumstances described in Section
4068(f) of ERISA; (iv) the withdrawal by the Borrower or an
ERISA Affiliate from a Multiple Employer Plan during a plan
year for which it was a "substantial employer", as defined
in Section 4001(a)(2) of ERISA; (v) the failure by the
Borrower or any ERISA Affiliate to make a payment to a Plan
required under Section 302(f)(1) of ERISA, which Section
imposes a lien for failure to make required payments;
(vi) the adoption of an amendment to a Plan requiring the
provision of security to such Plan, pursuant to Section 307
of ERISA; or (vii) the institution by the PBGC of
proceedings to terminate a Plan, pursuant to Section 4042 of
ERISA, or the occurrence of any event or condition which
might reasonably constitute grounds under Section 4042 of
ERISA for the termination of, or the appointment of a
trustee to administer, a 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.
<PAGE> 6
"Eurodollar Lending Office" means, with respect to any
Lender, the office of such Lender specified as its
"Eurodollar Lending Office" opposite its name on Schedule I
hereto 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 Agent.
"Eurodollar Rate" means, for each Interest Period for
each Eurodollar Rate Advance made as part of the same A
Borrowing, an interest rate per annum equal to the average
(rounded upward to the nearest whole multiple of 1/16 of 1%
per annum, if such average is not such a multiple) of the
rate per annum at which deposits in U.S. dollars are offered
by the principal office of each of the Reference Banks in
London, England to prime banks in the London interbank
market at 11:00 A.M. (London time) two Business Days before
the first day of such Interest Period in an amount
substantially equal to such Reference Bank's Eurodollar Rate
Advance made as part of such A Borrowing and for a period
equal to such Interest Period; provided, however, that if a
Reference Bank does not offer such deposits, the Eurodollar
Rate determined by such Reference Bank shall be based on the
rate per annum at which deposits are offered to the
principal office of such Reference Bank in the interbank
market in which such Reference Bank customarily conducts its
trading activities in eurodollars. The Eurodollar Rate for
the Interest Period for each Eurodollar Rate Advance made as
part of the same A Borrowing shall be determined by the
Agent on the basis of applicable rates furnished to and
received by the Agent from the Reference Banks two Business
Days before the first day of such Interest Period, subject,
however, to the provisions of Section 2.09.
"Eurodollar Rate Advance" means an A Advance which
bears interest as provided in Section 2.07(b).
"Eurodollar Rate Reserve Percentage" of any Lender for
each Interest Period for each Eurodollar Rate Advance means
the reserve percentage applicable to 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 Regulation D or
other regulations issued from time to time by the Board of
Governors of the Federal Reserve System (or any successor)
for determining the maximum reserve requirement (including,
without limitation, any emergency, supplemental or other
marginal reserve requirement) then applicable to such Lender
with respect to liabilities or assets consisting of or
including Eurocurrency Liabilities having a term equal to
such Interest Period.
<PAGE> 7
"Event of Default" has the meaning specified in Section
6.01.
"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 Agent from three Federal funds brokers of recognized
standing selected by it.
"Fee Letter" has the meaning specified in Section
2.04(b).
"Funded Debt" means, for any Person at any date of
determination, all Indebtedness of such Person which (i)
matures more than one year from the date of its creation,
(ii) matures within one year from the date of its creation
but is renewable or extendible, at the option of the debtor,
to a date more than one year from the date of its creation
or (iii) arises under a revolving credit or similar
agreement which obligates the lender or lenders to extend
credit during a period of more than one year from the date
of its creation, including, without limitation, all amounts
of Funded Debt of such Person required to be paid or prepaid
within one year from the date of determination; provided,
however, that any Indebtedness of the type described in
clauses (ii) and (iii) above shall constitute Funded Debt
only to the extent that such Person classifies such
Indebtedness as long-term debt on its consolidated balance
sheet.
"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 or other
legal or regulatory body required in connection with the
execution, delivery or performance of this Agreement or any
Note.
<PAGE> 8
"Hazardous Materials" means any flammable materials,
explosives, radioactive materials, hazardous materials,
hazardous wastes, hazardous or toxic substances, or related
or similar materials, asbestos or any material containing
asbestos, or any other substance or material as so defined
and regulated by any Federal, state or local environmental
law, ordinance, rule, or regulation including, without
limitation, the Comprehensive Environmental Response,
Compensation, and Liability Act of 1980, as amended (42
U.S.C. Sections 9601, et seq.), the Hazardous Materials
Transportation Act, as amended (49 U.S.C. Sections 1801, et
seq.), and the Resource Conservation and Recovery Act (42
U.S.C. Sections 6901, et seq.), and the regulations adopted
and publications promulgated pursuant thereto.
"Indebtedness" means, for any Person, all obligations
of such Person which in accordance with generally accepted
accounting principles should be classified on a balance
sheet of such Person as liabilities of such Person, and in
any event shall include, without duplication, all
(i) indebtedness for borrowed money, (ii) obligations
evidenced by bonds, debentures, notes or other similar
instruments, (iii) obligations to pay the deferred purchase
price of property or services, (iv) obligations as lessee
under leases which shall have been or should be, in
accordance with generally accepted accounting principles,
recorded as capital leases, (v) obligations (contingent or
otherwise) in respect of outstanding letters of credit,
(vi) indebtedness of the type referred to in clauses (i)
through (v) above secured by (or for which the holder of
such indebtedness has an existing right, contingent or
otherwise, to be secured by) any lien or encumbrance on, or
security interest in, property (including, without
limitation, accounts and contract rights) owned by such
Person, even though such Person has not assumed or become
liable for the payment of such indebtedness, and
(vii) obligations under direct or indirect guaranties in
respect of, and obligations (contingent or otherwise) to
purchase or otherwise acquire, or otherwise to assure a
creditor against loss in respect of, indebtedness or
obligations of others of the kinds referred to in clauses
(i) through (v) above. For the purpose of computing the
Indebtedness of any Person, there shall be excluded any
particular Indebtedness to the extent that, upon or prior to
the maturity thereof, there shall have been deposited with
the proper depositary in trust the necessary funds (or
evidences of such Indebtedness, if permitted by the
instrument creating such Indebtedness) for the payment,
redemption or satisfaction of such Indebtedness; and
thereafter such funds and evidences of Indebtedness so
deposited shall not be included in any computation of the
assets of such Person. For all purposes of this Agreement
the preferred stock of the Borrower, if any, shall be
treated as capital stock and not Indebtedness of the
Borrower.
<PAGE> 9
"Indemnified Person" has the meaning specified in
Section 8.04(c).
"Indenture" means that certain Indenture of Mortgage
and Deed of Trust, dated as of November 1, 1950, from the
Borrower to Mellon National Bank and Trust Company and D.A.
Hazlett, as Trustees, as amended and supplemented from time
to time in accordance with its terms.
"Insufficiency" means, with respect to any Plan, the
amount, if any, of its unfunded benefit liabilities, as
defined in Section 4001(a)(18) of ERISA.
"Interest Period" means, for each Eurodollar Rate
Advance made as part of the same A Borrowing, the period
commencing on the date of such Eurodollar Rate Advance or
the date of the Conversion of any A Advance into a
Eurodollar Rate Advance and ending on the last day of the
period selected by the Borrower pursuant to the provisions
below and, thereafter, each subsequent period commencing on
the last day of the immediately preceding Interest Period
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 1, 2, 3 or 6 months or,
if available, 9 or 12 months, as the Borrower may, upon
notice received by the Agent not later than 10:00 A.M. on
the third Business Day prior to the first day of such
Interest Period, select; provided, however, that:
a) the Borrower may not select any
Interest Period that ends after the Termination Date;
a) Interest Periods commencing on the
same date for Eurodollar Rate Advances comprising part of
the same A Borrowing shall be of the same duration;
a) 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; and
a) if any Interest Period begins on a day for
which there is no numerically corresponding day in the
calendar month at the end of such Interest Period, such
Interest Period shall end on the last Business Day of such
calendar month.
"Lenders" means the Banks and each assignee that shall
become a party hereto pursuant to Section 8.07.
<PAGE> 10
"Leverage Ratio" means, as of any date, the ratio of
Consolidated Debt to Total Capitalization.
"Majority Lenders" means, on any date of determination,
Lenders that, collectively, on such date (i) hold at least
66 % of the then aggregate unpaid principal amount of the A
Advances owing to Lenders and (ii) if no A Advances are then
outstanding, have Percentages in the aggregate of at least
66 %. Any determination of those Lenders constituting the
Majority Lenders shall be made by the Agent and shall be
conclusive and binding on all parties absent manifest error.
"Moody's" means Moody's Investors Service, Inc. or any
successor thereto.
"Moody's Rating" means, on any date of determination,
the rating of the long-term, senior, unsecured debt of the
Borrower most recently announced by Moody's.
"Multiemployer Plan" means a multiemployer plan, as
defined in Section 4001(a)(3) of ERISA, which is subject to
Title IV of ERISA and to which the Borrower or any ERISA
Affiliate is making or accruing an obligation to make
contributions, or has within any of the preceding five plan
years made or accrued an obligation to make contributions,
such plan being maintained pursuant to one or more
collective bargaining agreements.
"Multiple Employer Plan" means a single employer plan,
as defined in Section 4001(a)(15) of ERISA, which is subject
to Title IV of ERISA and which (i) is maintained for
employees of the Borrower or an ERISA Affiliate and at least
one Person other than the Borrower and its ERISA Affiliates
or (ii) was so maintained and in respect of which the
Borrower or an ERISA Affiliate could have liability under
Section 4064 or 4069 of ERISA in the event such plan has
been or were to be terminated.
"1993 Credit Facility" means that certain Revolving
Credit Agreement, dated as of March 29, 1993, as amended,
among the Borrower, the lenders named therein, and Citibank,
as agent for said lenders.
"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).
"Notice of Conversion" has the meaning assigned to that
term in Section 2.10.
<PAGE> 11
"Operating Entity" means any business, line of
business, business segment or operating unit of a Person
which is or could be operated separately and apart from the
other businesses and operations of such Person and as to
which, at any date of determination, assets valued at 10% or
more of the value of all assets owned by such Person are
attributable as of such date or annual revenue of 10% or
more of the total annual revenue of such Person is
attributable as of the fiscal year end of such Person last
preceding such date.
"Other Taxes" has the meaning specified in Section 2.15
(b).
"PBGC" means the Pension Benefit Guaranty Corporation
(or any successor entity) established under ERISA.
"Percentage" means, for any Lender on any date of
determination, the percentage obtained by dividing such
Lender's Commitment on such day by the total of the
Commitments on such date.
"Person" means an individual, partnership, corporation
(including a business trust), joint stock company, trust,
unincorporated association, joint venture or other entity,
or a government or any political subdivision or agency
thereof.
"Plan" means a Single Employer Plan or a Multiple
Employer Plan.
"Pricing Level" means Pricing Level I, Pricing Level
II, Pricing Level III, or Pricing Level IV, as applicable.
"Pricing Level I" means the applicable Pricing Level at
any time when the S&P Rating is AA- or higher or the Moody's
Rating is AA3 or higher.
"Pricing Level II" means the applicable Pricing Level
at any time when the S&P Rating is A or higher or the
Moody's Rating is A2 or higher and Pricing Level I is not
applicable.
"Pricing Level III" means the applicable Pricing Level
at any time when the S&P Rating is BBB or higher or the
Moody's Rating is Baa2 or higher and Pricing Level II is not
applicable.
"Pricing Level IV" means the applicable Pricing Level
at any time when the S&P Rating is lower than BBB and the
Moody's Rating is lower than Baa2 or when no S&P Rating and
no Moody's Rating are in effect.
"Reference Banks" means M&I Marshall & Ilsley Bank and
Citibank.
"Register" has the meaning specified in Section
8.07(c).
<PAGE> 12
"Restricted Payment" has the meaning specified in
Section 5.02(c).
"S&P" means Standard & Poor's Ratings Services, a
division of The McGraw-Hill Companies, Inc., or any
successor thereto.
"S&P Rating" means, on any date of determination, the
rating of the long-term, senior, unsecured debt of the
Borrower most recently announced by S&P.
"Single Employer Plan" means a single employer plan, as
defined in Section 4001(a)(15) of ERISA, which is subject to
Title IV of ERISA and which (i) is maintained for employees
of the Borrower or an ERISA Affiliate and no Person other
than the Borrower and its ERISA Affiliates or (ii) was so
maintained and in respect of which the Borrower or an ERISA
Affiliate could have liability under Section 4069 of ERISA
in the event such plan has been or were to be terminated.
"Subsidiary" means, with respect to any Person, any
corporation or unincorporated entity of which more than 50%
of the outstanding capital stock (or comparable interest)
having ordinary voting power (irrespective of whether at the
time capital stock (or comparable interest) of any other
class or classes of such corporation or entity shall or
might have voting power upon the occurrence of any
contingency) is at the time directly or indirectly owned by
said Person (whether directly or through one of more other
Subsidiaries). In the case of an unincorporated entity, a
Person shall be deemed to have more than 50% of interests
having ordinary voting power only if such Person's vote in
respect of such interests comprises more than 50% of the
total voting power of all such interests in the
unincorporated entity.
"Taxes" has the meaning specified in Section 2.15 (a).
"Termination Date" means the earlier to occur of
(i) the fifth anniversary of the date of this Agreement, and
(ii) the date of termination or reduction in whole of the
Commitments pursuant to Section 2.05 or 6.01.
"Thirteenth Supplemental Indenture" means that certain
Thirteenth Supplemental Indenture from the Borrower to
Mellon Bank, N.A. and N.R. Smith, as Trustees, dated as of
September 1, 1988.
<PAGE> 13
"Total Capitalization" means, at any date of
determination, the sum of (a) Consolidated Debt, (b)
consolidated equity of the common stockholders of the
Borrower and the Consolidated Subsidiaries, (c)
consolidated equity of the preference stockholders of the
Borrower and the Consolidated Subsidiaries and (d)
consolidated equity of the preferred stockholders of the
Borrower and the Consolidated Subsidiaries, in each case
determined at such date in accordance with generally
accepted accounting principles.
"Type" has the meaning assigned to that term (i) in the
definition of "A Advance" when used in such context and
(ii) in the definition of "Borrowing" when used in such
context.
"Unmatured Default" means an event that, with the
giving of notice or lapse of time, or both, would constitute
an Event of Default.
"WICOR" means WICOR, Inc., a Wisconsin corporation and
the owner of all of the common stock of the Borrower.
"WICOR Credit Agreement" means that certain Revolving
Credit Agreement, dated as of the date hereof, among WICOR,
the banks party thereto, and Citibank, as agent thereunder,
as amended, modified or supplemented from time to time in
accordance with its terms.
"WICOR Industries" means WICOR Industries, Inc., a
Wisconsin corporation, all of whose common stock is owned on
the date hereof by WICOR.
"WII Credit Agreement" means that certain Revolving
Credit Agreement, dated as of the date hereof, among WICOR
Industries, the banks party thereto, and Citibank, as agent
thereunder, as amended, modified or supplemented from time
to time in accordance with its terms.
A. SECTION Computation of Time Periods. Unless
otherwise indicated, each reference in this Agreement to a
specific time of day is a reference to New York City time.
In the computation of periods of time under this Agreement,
any period of a specified number of days or months shall be
computed by including the first day or month occurring
during such period and excluding the last such day or month.
In the case of a period of time "from" a specified date "to"
or "until" a later specified date, the word "from" means
"from and including" and the words "to" and "until" each
means "to but excluding".
<PAGE> 14
A. SECTION Accounting Terms. All accounting terms
not specifically defined herein shall be construed in
accordance with generally accepted accounting principles
consistent with those applied in the preparation of the
audited financial statements referred to in Section 4.01(e),
as such generally accepted accounting principles may be
applied by regulated enterprises (to the extent prescribed
by the Public Service Commission of Wisconsin) pursuant to
the requirements of the Uniform System of Accounts
Prescribed for Natural Gas Companies Subject to the
Provisions of the Natural Gas Act, set forth from time to
time in Part 201, Subchapter F of 18 C.F.R. Chapter 1
(1988).
A. SECTION Computations of Outstandings. Whenever
reference is made in this Agreement to the "principal amount
outstanding" on any date under this Agreement, such
reference shall refer to the aggregate principal amount of
all Advances outstanding on such date after giving effect to
all Borrowings to be made on such date and the application
of the proceeds thereof.
I. ARTICLE
AMOUNTS AND TERMS OF THE ADVANCES
A. SECTION The A Advances. 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 maintained by the Agent pursuant
to Section 8.07(c), as such amount may be reduced pursuant
to Section 2.05 (such 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 applied to the Lenders ratably according to their
respective Commitments (such deemed use of the aggregate
amount of the Commitments being a "B Reduction"). Each A
Borrowing shall consist of A Advances of the same Type made
on the same day by the Lenders ratably according to their
respective Commitments. Each A Borrowing consisting of
Eurodollar Rate Advances shall be in an aggregate amount not
less than $5,000,000 or an integral multiple of $1,000,000
in excess thereof. Each A Borrowing consisting of Base Rate
Advances shall be in an aggregate amount not less than
$500,000 or an integral multiple of $500,000 in excess
thereof. 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.
<PAGE> 15
1. SECTION Making the A Advances. Each A Borrowing
shall be made on notice by the Borrower to the Agent, given
not later than 10:00 A.M. (i) in the case of an A Borrowing
comprised of Base Rate Advances, on the date of the proposed
A Borrowing, and (ii) in the case of an A Borrowing
comprised of Eurodollar Rate Advances, three Business Days
prior to the date of the proposed A Borrowing. The Agent
shall give to each Lender prompt notice of each proposed A
Borrowing by telecopier, telex or cable. Each such notice
from the Borrower 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 (A) date of such A Borrowing, (B) Type
of A Advances comprising such A Borrowing, (C) aggregate
amount of such A Borrowing, and (D) in the case of an A
Borrowing comprised of Eurodollar Rate Advances, initial
Interest Period for each such A Advance. Upon fulfillment
of the applicable conditions set forth in Article III, each
Lender shall, before 12:00 Noon on the date of such A
Borrowing, make available for the account of its Applicable
Lending Office to the Borrower, at the Borrower's Account,
in same day funds, such Lender's Percentage of such A
Borrowing.
1. 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 for such A Borrowing the applicable
conditions set forth in Article III, or as a result of such
A Borrowing not being completed on the proposed date thereof
because of a reason attributable to the Borrower, including,
without limitation, any loss (including 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 when such A Advance,
as a result of such failure, is not made on such date.
1. The failure of any Lender to make the A
Advance to be made 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.
<PAGE> 16
1. SECTION The B Advances. 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 Termination Date
in the manner, and subject to the terms and conditions, 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).
a) The Borrower may request a B Borrowing under
this Section 2.03 by delivering to the 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 nor later than the
earlier to occur of the then scheduled Termination Date and
the date occurring 360 days following the date of such B
Borrowing), the interest payment date or dates relating
thereto, the basis upon which rates of interest are to be
determined, and any other terms to be applicable to such B
Borrowing, not later than 11:00 A.M. (A) at least two
Business Days 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 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. The Agent
shall in turn promptly notify each Lender of each request
for a B Borrowing received by it from the Borrower by
sending such Lender a copy of the related Notice of B
Borrowing.
<PAGE> 17
a) 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 Agent (which
shall give prompt notice thereof to the Borrower), before
11:00 A.M. (A) on the date of such proposed B Borrowing, in
the case of a Notice of B Borrowing delivered pursuant to
clause (A) of paragraph (i) above and (B) three Business
Days before the date of such proposed B Borrowing, in the
case of a Notice of B Borrowing delivered pursuant to clause
(B) of paragraph (i) above 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), the rate
or rates of interest therefor and such Lender's Applicable
Lending Office with respect to such B Advance; provided that
if the 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 10:00 A.M. on the date on
which notice of such election is to be given to the Agent by
the other Lenders. If any Lender shall elect not to make
such an offer, such Lender shall so notify the Agent before
11:00 A.M. on the date on which notice of such election is
to be given to the 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.
b) The Borrower shall, in turn, (A) before 12:00
Noon on the date of such proposed B Borrowing, in the case
of a Notice of B Borrowing delivered pursuant to clause (A)
of paragraph (i) above and (B) before 1:00 P.M. three
Business Days before the date of such proposed B Borrowing,
in the case of a Notice of B Borrowing delivered pursuant to
clause (B) of paragraph (i) above either
(x) cancel such B Borrowing by either giving
the Agent notice to that effect or failing to accept
one or more offers as provided in clause (y) below, or
<PAGE> 18
(y) accept one or more of the offers
made by any Lender or Lenders pursuant to paragraph
(ii) above, in its sole discretion, but based
exclusively upon the rate or rates of interest offered
by a Lender or the Lenders in order of the lowest to
the highest rates, by giving written notice to the
Agent of the amount of each B Advance to be made by
each Lender as part of such B Borrowing, and reject any
remaining offers made by Lenders pursuant to paragraph
(ii) above, by giving the Agent written notice to that
effect. The amount of the B Advance to be made by each
Lender 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 Agent on behalf of such
Lender for such B Advance pursuant to paragraph (ii)
above, and the aggregate of the B Advances to be made
by all Lenders shall not exceed the aggregate amount of
the proposed B Borrowing specified by the Borrower
pursuant to paragraph (i) above. If the Borrower
accepts offers made by two or more Lenders that offered
to make B Advances at the same rate of interest, the
amount of the B Borrowing to be made at such rate of
interest shall be allocated among such Lenders in
proportion to the amount of B Advances that each such
Lender offered to make at such rate.
a) If the Borrower cancels such B Borrowing
pursuant to paragraph (iii)(x) above, the Agent shall give
prompt notice thereof to the Lenders and such B Borrowing
shall not be made.
If the Borrower accepts one or more of the offers made
by any Lender or Lenders pursuant to paragraph (iii)(y) above,
such acceptance shall be irrevocable and binding on the Borrower
and, subject to the satisfaction of the applicable conditions set
forth in Article III, on such Lender or Lenders. The Borrower
shall indemnify each such Lender against any loss, cost or
expense actually incurred by such Lender as a result of any
failure to fulfill, on or before the date specified in the notice
provided pursuant to paragraph (vi)(A) below the applicable
conditions set forth in Article III, or as a result of such B
Borrowing not being completed on such date because of a reason
attributable to the Borrower, including, without limitation, any
loss, cost or expense incurred by reason of the liquidation or
reemployment of deposits or other funds acquired by such Lender
to fund the B Advance to be made by such Lender as part of such B
Borrowing when such B Advance, as a result of such failure, is
not made on such date.
<PAGE> 19
b) If the Borrower accepts one or more of the offers
made by any Lender or Lenders pursuant to paragraph (iii)(y)
above, the 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 the 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 Agent has received forms
of documents appearing to fulfill the applicable conditions
set forth in Article III. Upon fulfillment of 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 1:00 P.M. on the date of such B Borrowing
specified in the notice received from the Agent pursuant to
clause (A) of the preceding sentence or any later time when
such Lender shall have received notice from the Agent
pursuant to clause (C) of the preceding sentence, make
available for the account of its Applicable Lending Office
to the Borrower, at the Borrower's Account, such Lender's
portion of such B Borrowing, in same day funds. Promptly
after each B Borrowing the 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.
1. Following the making of each B Borrowing, the
Borrower shall be in compliance with the limitation set
forth in the proviso to the first sentence of subsection (a)
above.
1. 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 (d) below, and reborrow under this Section 2.03,
provided that a B Borrowing shall not be made within three
Business Days of the date of any other B Borrowing.
1. The Borrower shall repay to 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 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. Such repayment shall be made to
such account of such Lender as may be specified in the B
Note evidencing such B Advance, or such other account as may
be specified from time to time by such Lender in a notice to
the Borrower and the Agent. The Borrower shall have no
right to prepay any principal amount of any B Advance.
<PAGE> 20
1. 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.
1. 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.
1. SECTION Fees. The Borrower agrees to pay to
the Agent for the account of each Lender a facility fee
based on such Lender's Commitment (determined without giving
effect to any B Reduction or Borrowing) from the date
hereof, 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 other Lender,
until the Termination Date, payable quarterly in arrears on
the last day of each March, June, September and December
during the term of such Lender's Commitment, commencing
September 30, 1997, and on the Termination Date, at a rate
per annum equal to the Applicable Fee Percentage.
1. In addition to the fees provided for in
subsection (a) above, the Borrower shall pay or cause to be
paid to the Agent, for the account of the Agent, such fees
as are provided for in the separate fee letter, dated
July 9, 1997, between WICOR and the Agent (the "Fee
Letter").
1. SECTION Reduction of the Commitments. The
Borrower shall have the right, upon at least five Business
Days' notice to the 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 B Advances then outstanding; and
provided, further, that each partial reduction shall be in
an aggregate amount of $5,000,000 or an integral multiple of
$1,000,000 in excess thereof.
1. On the Termination Date, the Commitments of
the Lenders shall be reduced to zero.
A. SECTION Repayment of A Advances. The Borrower
shall repay the principal amount of each A Advance made by
each Lender in accordance with the A Note to the order of
such Lender.
<PAGE> 21
A. SECTION Interest on A Advances. The Borrower
shall pay interest on the unpaid principal amount of each A
Advance owing to each Lender from the date of such A Advance
until such principal amount shall be paid in full, at the
Applicable Rate for such A Advance (except as otherwise
provided in this Section 2.07), payable as follows:
1. Base Rate Advances. If such A Advance is a
Base Rate Advance, interest thereon shall be payable
quarterly in arrears on the last day of each March, June,
September and December, on the date of any Conversion of
such Base Rate Advance and on the date such Base Rate
Advance shall become due and payable or otherwise shall be
paid in full.
1. Eurodollar Rate Advances. If such A Advance
is a Eurodollar Rate Advance, interest thereon shall be
payable on the last day of the Interest Period for such A
Advance and, if such Interest Period has a duration of more
than three months, on each day which occurs during such
Interest Period every three months from the first day of
such Interest Period.
A. SECTION 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
of Governors of the Federal Reserve System to maintain
reserves with respect to liabilities or assets consisting of
or including Eurocurrency Liabilities, additional interest
on the unpaid principal amount of each Eurodollar Rate
Advance of such Lender, from the date of such A 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 Interest
Period for such A 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 A Advance. Such additional
interest shall be determined by such Lender and notified to
the Borrower through the Agent. If requested by the
Borrower, the Lender requesting such additional interest
shall provide a brief summary of the manner in which such
additional interest was determined, provided that the
failure to deliver such summary or, absent manifest error,
the contents of such summary shall not affect the obligation
of the Borrower to pay such additional interest.
1. SECTION Interest Rate Determination. Each
Reference Bank agrees to furnish to the Agent timely
information for the purpose of determining each Eurodollar
Rate. If any Reference Bank shall not furnish such timely
information to the Agent for the purpose of determining any
such interest rate, the Agent shall determine such interest
rate on the basis of timely information furnished by the
remaining Reference Bank or Reference Banks.
<PAGE> 22
1. The Agent shall give prompt notice to the
Borrower and the Lenders of the applicable interest rate
determined by the Agent for purposes of Section 2.07(a) or
(b).
1. If, with respect to any Eurodollar Rate
Advances, (i) the Majority Lenders notify the 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 or
(ii) the Reference Banks notify the Agent that adequate and
fair means do not exist for ascertaining the applicable
interest rate on the basis provided for in the definition of
Eurodollar Rate, the Agent shall forthwith so notify the
Borrower and the Lenders, whereupon
(1) each Eurodollar Rate Advance will
automatically, on the last day of the then existing Interest
Period therefor, Convert into a Base Rate Advance, and
(1) the obligation of the Lenders to make, or to
Convert A Advances into, Eurodollar Rate Advances shall be
suspended until the Agent shall notify the Borrower and the
Lenders that the circumstances causing such suspension no
longer exist.
1. (i) If the Borrower shall fail to (A) 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, or
(B) provide a Notice of Conversion with respect to any
Eurodollar Rate Advances on or prior to 11:00 A.M. on the
third Business Day prior to the last day of the Interest
Period applicable thereto, in the case of a Conversion to or
in respect of Eurodollar Rate Advances, or (ii) an Event of
Default shall have occurred and be continuing on the third
Business Day prior to the last day of the Interest Period
with respect to any Eurodollar Advance, the 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.
On the date on which the aggregate unpaid principal
amount of A Advances comprising any A Borrowing shall be reduced,
by payment or prepayment or otherwise, to less than $5,000,000,
such A Advances shall, if they are Advances of a Type other than
Base Rate Advances, automatically Convert into Base Rate
Advances, and on and after such date the right of the Borrower to
Convert such A Advances into Advances of a Type other than Base
Rate Advances shall terminate; provided, however, that if and so
long as each such A Advance shall be of the same Type and have
the same Interest Period as A Advances comprising another A
Borrowing or other A Borrowings,
<PAGE> 23
and the aggregate unpaid principal amount of all such A Advances
shall equal or exceed $5,000,000, the Borrower shall have the
right to continue all such A Advances as, or to Convert all such
A Advances into, Advances of such Type having such Interest
Period.
A. SECTION Voluntary Conversion of A Advances. The
Borrower may on any Business Day, by delivering a Notice of
Conversion (a "Notice of Conversion") to the Agent not later
than 11:00 A.M. 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 A Advances of one Type
comprising the same A Borrowing into A Advances of another
Type; provided, however, that any Conversion of any
Eurodollar Rate Advances into A Advances of another Type
shall be made on, and only on, the last day of an Interest
Period for such Eurodollar Rate Advances. Each such Notice
of Conversion shall be in substantially the form of Exhibit
B-3 hereto and shall, within the restrictions specified
above, specify (i) the date of such Conversion, (ii) the A
Advances to be Converted, (iii) if such Conversion is into
Eurodollar Rate Advances, the duration of the Interest
Period for each such A Advance, and (iv) the aggregate
amount of A Advances proposed to be Converted.
1. SECTION Prepayments of A Advances. The
Borrower shall have no right to prepay any principal amount
of any A Advances other than as provided in subsections (b)
and (c) below.
1. The Borrower may, upon at least two Business
Days' notice to the 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 A Advances comprising part of the
same A 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 $1,000,000 (or, if lower, the principal amount
outstanding hereunder on the date of such prepayment) or an
integral multiple 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 for
such Advance, the Borrower shall be obligated to reimburse
the Lenders in respect thereof pursuant to Section 8.04(b).
<PAGE> 24
1. On the date of any termination or reduction
of the Commitments pursuant to Section 2.05, the Borrower
shall pay or prepay for the ratable accounts of the Lenders
so much of the principal amount outstanding under this
Agreement as shall be necessary in order that the principal
amount outstanding (after giving effect to such prepayment)
will not exceed the amount of Commitments following such
termination or reduction, together with (i) accrued interest
to the date of such prepayment on the principal amount
repaid or prepaid and (ii) in the case of prepayments of
Eurodollar Rate Advances, any amount payable to the Lenders
pursuant to Section 8.04(b).
1. SECTION Increased Costs. If, due to either
(i) the introduction of or any change (other than any change
by way of imposition or increase of reserve requirements, in
the case of Eurodollar Rate Advances, included in the
Eurodollar Rate Reserve Percentage) in or in the
interpretation of any law or regulation or (ii) the
compliance with any guideline or request from any central
bank or other governmental authority (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, then the Borrower
shall from time to time, upon demand by such Lender (with a
copy of such demand to the Agent), pay to such Lender
additional amounts sufficient to compensate such Lender for
such increased cost. Each Lender agrees to notify the
Borrower of any such increased costs as soon as reasonably
practicable after determining that such increased cost is
applicable to Eurodollar Rate Advances hereunder. A
certificate as to the amount of such increased cost,
submitted to the Borrower and the Agent by such Lender,
shall be conclusive and binding for all purposes, absent
manifest error. If requested by the Borrower, the Lender
requesting such increased cost shall provide a brief summary
of the manner in which such increased cost was determined,
provided that the failure to deliver such summary or, absent
manifest error, the contents of such summary shall not
affect the obligation of the Borrower to pay such increased
cost.
If any Lender determines that compliance with any law
or regulation or any guideline or request from any central bank
or other governmental authority (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, upon demand by such Lender (with a copy of such demand to
the Agent), the Borrower shall immediately pay to such Lender,
from time to time as specified by such Lender, additional amounts
sufficient to compensate such Lender
<PAGE> 25
or such corporation in the light of such circumstances, to the
extent that such Lender reasonably determines such increase in
capital to be allocable to the existence of such Lender's
commitment to lend hereunder. Each Lender agrees to notify the
Borrower of any such additional amount as soon as reasonably
practicable after the Lender makes such determination. A
certificate as to such amounts submitted to the Borrower and the
Agent by such Lender shall be conclusive and binding for all
purposes, absent manifest error. If requested by the Borrower,
the Lender requesting such additional amount shall provide a
brief summary of the manner in which such additional amount was
determined, provided that the failure to deliver such summary or,
absent manifest error, the contents of such summary shall not
affect the obligation of the Borrower to pay such additional
amount.
1. The provisions contained in this Section 2.12
shall survive for a period of 90 days after the repayment
(on or after the Termination Date) of all A Advances.
A. SECTION Illegality. Notwithstanding any other
provision of this Agreement, if any Lender shall notify the
Agent that the introduction of or any change in or in the
interpretation of any law or regulation makes it unlawful,
or any central bank or other governmental authority asserts
that it is unlawful, for any Lender or its Eurodollar
Lending Office to perform its obligations hereunder to make
Eurodollar Rate Advances or to fund or maintain Eurodollar
Rate Advances hereunder, (i) the obligation of the Lenders
to make, or to Convert A Advances into, Eurodollar Rate
Advances shall be suspended until the Agent (based on notice
from the affected Lender) shall notify the Borrower and the
Lenders that the circumstances causing such suspension no
longer exist and (ii) the Borrower shall forthwith prepay in
full all Eurodollar Rate Advances of all Lenders then
outstanding, together with interest accrued thereon, unless
the Borrower, within five Business Days of notice from the
Agent (or such shorter, maximum period of time, specified by
the Agent, as may be legally allowable), Converts all
Eurodollar Rate Advances of all Lenders then outstanding
into Base Rate Advances in accordance with Section 2.10.
<PAGE> 26
1. SECTION Payments and Computations. The
Borrower shall make each payment hereunder and under the A
Notes not later than 12:00 Noon on the day when due in U.S.
dollars to the Agent at its address referred to in Section
8.02 in same day funds. The Agent will promptly thereafter
cause to be distributed like funds relating to the payment
of principal or interest or facility fees ratably (other
than amounts payable pursuant to Section 2.03 or 2.08) 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 8.07(d), from
and after the effective date specified in such Assignment
and Acceptance, the 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.
1. The Borrower hereby authorizes each Lender,
if and to the extent payment owed to such Lender is not made
to the Agent when due hereunder or under any Note held by
such Lender, to charge from time to time against any or all
of the Borrower's accounts with such Lender any amount so
due.
1. All computations of interest based on the
Base Rate shall be made by the 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 and of facility
fees shall be made by the 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 Agent (or, in the case of Section 2.08, by a Lender)
of an interest rate hereunder shall be conclusive and
binding for all purposes, absent manifest error.
1. Whenever any payment hereunder or under the
Notes shall be stated to be due on a day other than a
Business Day, such payment shall be made on the next
succeeding Business Day, and such extension of time shall in
such case be included in the computation of payment of
interest or facility fees, as the case may be; provided,
however, that 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.
<PAGE> 27
1. Unless the 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 Agent may assume that the Borrower
has made such payment in full to the Agent on such date and
the 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 Agent, each Lender shall repay to the Agent
forthwith on demand such Lender's pro rata share of such
deficiency 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 Agent, at the
Federal Funds Rate.
1. SECTION Taxes. Any and all payments by the
Borrower hereunder and 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 Agent, taxes imposed on its overall net
income, and franchise taxes imposed on it by the
jurisdiction under the laws of which such Lender or the
Agent (as the case may be) is organized or any political
subdivision thereof and, in the case of each Lender, taxes
imposed on its overall net 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 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 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.
1. 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").
<PAGE> 28
1. The Borrower will indemnify each Lender and
the Agent for the full amount of Taxes or Other Taxes
(including, without limitation, any Taxes or Other Taxes
imposed by any jurisdiction on amounts payable under this
Section 2.15) paid by such Lender or the 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 or Other Taxes were correctly or legally
asserted. This indemnification shall be made within 30 days
from the date such Lender or the Agent (as the case may be)
makes written demand therefor. Nothing herein shall
preclude the right of the Borrower to contest any such Taxes
or Other Taxes so paid, and the Lenders in question or the
Agent (as the case may be) will, following notice from, and
at the expense of, the Borrower, reasonably cooperate with
the Borrower to preserve the Borrower's rights to contest
such Taxes or Other Taxes.
1. Within 30 days after the date of any payment
of Taxes, the Borrower will furnish to the Agent, at its
address referred to in Section 8.02, the original or a
certified copy of a receipt evidencing payment thereof.
1. Each Lender agrees that, on or prior to the
date upon which it shall become a party hereto, and upon the
reasonable request from time to time of the Borrower or the
Agent, such Lender will deliver to the Borrower and the
Agent either (i) a statement that it is organized under the
laws of a jurisdiction within the United States of America
or (ii) duly completed copies of such form or forms as may
from time to time be prescribed by the United States
Internal Revenue Service indicating that such Lender is
entitled to receive payments without deduction or
withholding of any United States federal income taxes, as
permitted by the Code. Each Lender represents and warrants
that each such form delivered by it to the Agent and the
Borrower pursuant to this subsection (e) is or will be, as
the case may be, complete and accurate at the time
delivered. Each Lender that delivers to the Borrower and
the Agent the form or forms referred to in clause (ii) above
further undertakes to deliver to the Borrower and the Agent
further copies of such form or forms, or successor
applicable form or forms, as the case may be, as and when
any previous form filed by it hereunder shall expire or
shall become incomplete or inaccurate in any respect.
1. Any Lender claiming any additional amounts
payable pursuant to this Section 2.15 shall use its best
efforts (consistent with its internal policy and legal and
regulatory restrictions) to change the jurisdiction of its
Applicable Lending Office if the making of such a change
would avoid the need for, or reduce the amount of, any such
additional amounts which may thereafter accrue and would
not, in the reasonable judgment of such Lender, be otherwise
disadvantageous to such Lender.
<PAGE> 29
1. Without prejudice to the survival of any
other agreement of the Borrower hereunder, the agreements
and obligations of the Borrower contained in this Section
2.15 shall survive for a period of four years after the
payment in full of principal and interest hereunder and
under the Notes.
A. SECTION 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 8.04(b)) in excess of its ratable
share of payments on account of the A Advances obtained by
all the Lenders, such Lender shall, if such payment relates
to principal of or interest on an A Advance, 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 each 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. If such excess payment relates to any fees
payable hereunder, the Lender receiving such excess payment
shall forthwith remit such excess payment to the Agent for
distribution by the Agent to the Lenders on a pro rata
basis, provided, however, that if all or any portion of such
excess payment is thereafter recovered from such receiving
Lender, each Lender shall remit to the Agent for
redistribution to the receiving Lender such Lender's ratable
share of the amount so recovered together with an amount
equal to such Lender's ratable share of any interest or
other amount paid or payable by the receiving Lender in
respect of the total amount so recovered.
<PAGE> 30
I. ARTICLE
CONDITIONS OF LENDING
A. SECTION Conditions Precedent to Closing. The
Commitments of the Lenders shall not become effective unless
the following conditions precedent shall have been fulfilled
on or prior to August 6, 1997 (or such later Business Day as
the parties hereto may mutually agree):
1. The Agent shall have received the following,
each dated the date of the Closing (unless otherwise
indicated), in form and substance satisfactory to the
Lenders and (except for the A Notes and the Fee Letter) in
sufficient copies for each Lender:
a) this Agreement, duly executed by the
Borrower, each Bank and the Agent;
a) the A Notes payable to the order of the
Lenders, respectively, duly completed and executed by the
Borrower;
a) certified copies of the resolutions of the
Board of Directors of the Borrower approving this Agreement
and the Notes, and of all documents evidencing other
necessary corporate action and Governmental Approvals, if
any, with respect to this Agreement and the Notes, together
with certified copies of the charter and by-laws (or
equivalent documents) of the Borrower, and a certificate of
status dated within thirty days of the date of the Closing
from the Department of Financial Institutions of the State
of Wisconsin (or other appropriate authority of such
jurisdiction) with respect to the legal status of the
Borrower;
a) a certificate of the Secretary or an
Assistant Secretary of the Borrower certifying the names,
true signatures and incumbency of the officers of the
Borrower authorized to sign this Agreement and the Notes and
the other documents to be delivered hereunder;
a) a favorable opinion of Robert A. Nuernberg,
the senior legal advisor of the Borrower, and Foley &
Lardner, special Wisconsin counsel to the Borrower,
substantially in the forms of Exhibits D and E hereto,
respectively, and as to such other matters as any Lender
through the Agent may reasonably request;
a) a favorable opinion of King & Spalding,
special New York counsel to the Agent, substantially in the
form of Exhibit F hereto;
<PAGE> 31
a) an irrevocable notice from the Borrower
requesting termination of the "Commitments" under the 1993
Credit Facility effective automatically on such date upon
the satisfaction (or waiver) of the other conditions
precedent set forth in this Section 3.01;
a) the Fee Letter, duly executed by WICOR;
a) a certified copy of the Indenture and the
Thirteenth Supplemental Indenture; and
a) such other approvals, opinions and documents
as any Lender, through the Agent, may reasonably request.
1. The following statements shall be true and
correct and the Agent shall have received a certificate of a
duly authorized officer of the Borrower, dated the date of
the Closing and in sufficient copies for each Lender,
stating that:
a) the representations and warranties set forth
in Section 4.01 of this Agreement are true and correct on
and as of the date of the Closing as though made on and as
of such date, and
a) no event has occurred and is continuing that
constitutes an Unmatured Default or an Event of Default.
1. The Borrower shall have paid (i) all fees
under or referenced in Section 2.04 hereof, to the extent
then due and payable, and (ii) all costs and expenses of the
Agent (including counsel fees and disbursements) incurred
through (and for which statements have been provided prior
to) the Closing.
1. Each of the WICOR Credit Agreement and the
Wll Credit Agreement shall have been duly executed and
delivered by the parties thereto and each of the applicable
conditions precedent enumerated in Section 3.01 of each of
the WICOR Credit Agreement and the WII Credit Agreement
shall have been fulfilled to the satisfaction of, or waived
with the consent of, the lenders party to such agreements,
Citibank, as administrative agent under each such agreement,
and WICOR and WICOR Industries, as applicable.
A. SECTION Conditions Precedent to Each A
Borrowing. The obligation of each Lender to make an A
Advance on the occasion of each A Borrowing (including the
initial A Borrowing) shall be subject to the conditions
precedent that, on the date of such A Borrowing,
1. the following statements shall be true and
correct (and each of the giving of the applicable Notice of
A Borrowing and the acceptance by the Borrower of the
proceeds of such A Borrowing shall constitute a
representation and warranty by the Borrower that, on the
date of such A Borrowing, such statements are true and
correct):
<PAGE> 32
a) the representations and warranties contained
in Section 4.01 are true and correct on and as of the date
of such A Borrowing, before and after giving effect to such
A Borrowing and to the application of the proceeds
therefrom, as though made on and as of such date, and
a) no event has occurred and is continuing, or
would result from such A Borrowing or from the application
of the proceeds therefrom, which constitutes an Event of
Default or an Unmatured Default, and
1. the Agent shall have received such other
approvals, opinions or documents as any Lender through the
Agent may reasonably request, and such approvals, opinions
and documents shall be satisfactory in form and substance to
the Agent.
A. SECTION Conditions Precedent to Each B
Borrowing. The obligation of each Lender to make a B
Advance on the occasion of a B Borrowing (including the
initial B Borrowing) shall be subject to the conditions
precedent that (a) the Agent shall have received the written
confirmatory Notice of B Borrowing with respect thereto,
(b) on or before the date of such B Borrowing, but prior to
such B Borrowing, the Agent shall have received (for
delivery to such Lender) a B Note payable to the order of
such Lender for each of the one or more 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
Section 2.03, (c) on the date of such B Borrowing the
following statements shall be true and correct (and each of
the giving of the applicable Notice of B Borrowing and the
acceptance by the Borrower of the proceeds of such B
Borrowing shall constitute a representation and warranty by
the Borrower that, on the date of such B Borrowing, such
statements are true and correct):
a) the representations and warranties contained
in Section 4.01 are correct on and as of the date of such B
Borrowing, before and after giving effect to such B
Borrowing and to the application of the proceeds therefrom,
as though made on and as of such date, and
a) no event has occurred and is continuing, or
would result from such B Borrowing or from the application
of the proceeds therefrom, which constitutes an Event of
Default or an Unmatured Default, and
(d) the Agent shall have received such other approvals, opinions,
or documents as any Lender through the Agent may reasonably
request, and such approvals, opinions, and documents shall be
satisfactory in form and substance to the Agent.
<PAGE> 33
A. SECTION Reliance on Certificates. The Lenders
and the Agent shall be entitled to rely conclusively upon
the certificates delivered from time to time by officers of
the Borrower as to the names, incumbency, authority and
signatures of the respective Persons named therein until
such time as the Agent may receive a replacement
certificate, in form acceptable to the Agent, from an
officer of the Borrower identified to the Agent as having
authority to deliver such certificate, setting forth the
names and true signatures of the officers and other
representatives of the Borrower thereafter authorized to act
on its behalf.
I. ARTICLE
REPRESENTATIONS AND WARRANTIES
A. SECTION Representations and Warranties of the
Borrower. The Borrower represents and warrants as follows:
1. The Borrower is a corporation duly organized,
validly existing and in good standing under the laws of the
State of Wisconsin and is duly qualified to do business in,
and is in good standing in, all other jurisdictions where
the nature of its business or the nature of property owned
or used by it makes such qualification necessary. Each
Subsidiary of the Borrower is duly incorporated, validly
existing and in good standing under the laws of the
jurisdiction of its incorporation and is duly qualified to
do business in, and is in good standing in, all other
jurisdictions where the nature of its business or the nature
of property owned or used by it makes such qualification
necessary. Each of the Borrower and its Subsidiaries has
all requisite corporate powers and authority to own or lease
and operate its properties and to carry on its business as
now conducted and as proposed to be conducted.
1. The execution, delivery and performance by
the Borrower of this Agreement and the Notes are within the
Borrower's corporate powers, have been duly authorized by
all necessary corporate action, do not contravene (i) the
Borrower's charter or by-laws, (ii) any law, rule or
regulation applicable to the Borrower or (iii) any
contractual or legal restriction binding on or affecting the
Borrower, and will not result in or require the imposition
of any lien or encumbrance on, or security interest in, any
property (including, without limitation, accounts or
contract rights) of the Borrower.
1. No Governmental Approval is required that has
not been obtained.
<PAGE> 34
1. This Agreement is, and the Notes when
executed and delivered hereunder will be, legal, valid and
binding obligations of the Borrower enforceable against the
Borrower in accordance with their respective terms.
1. Each of the audited consolidated balance
sheet of the Borrower and its Subsidiaries as at December
31, 1996, and the related statements of income, retained
earnings and cash flows of the Borrower and its Subsidiaries
for the fiscal year then ended, and the unaudited
consolidated balance sheet of the Borrower and its
Subsidiaries as at March 31, 1997, and the related
statements of income, retained earnings and cash flows of
the Borrower and its Subsidiaries for the three months then
ended, copies of which have been furnished to each Bank,
fairly present (subject, in the case of such financial
statements dated March 31, 1997, to year-end adjustments)
the financial condition of the Borrower and its Subsidiaries
as at such dates and the results of the operations of the
Borrower and its Subsidiaries for the periods ended on such
dates, all in accordance with generally accepted accounting
principles consistently applied (modified as described in
Section 1.03). Since December 31, 1996, there has been no
material adverse change in such condition or results of
operations, in the prospects of the Borrower and its
Subsidiaries, or in the ability of the Borrower to perform
its obligations hereunder and under the Notes.
1. There is no pending or threatened action or
proceeding affecting the Borrower or any of its Subsidiaries
before any court, governmental agency or arbitrator, that
could, if adversely determined, reasonably be expected to
materially adversely affect the financial condition, results
of operations, operations or prospects of the Borrower or
any of its Subsidiaries or which purports to affect the
legality, validity or enforceability of this Agreement or
any Note.
1. The use of the proceeds of each Advance will
comply with all provisions of applicable law and regulation
in all material respects.
1. Each of the Borrower and its Subsidiaries has
filed all tax returns (Federal, state and local) required to
be filed and paid all taxes shown thereon to be due,
including interest and penalties, except to the extent the
Borrower or any of its Subsidiaries is diligently contesting
any such taxes in good faith and by appropriate proceedings,
and for which adequate reserves for payment thereof have
been established.
1. None of the Borrower or any of its
Subsidiaries is an "investment company" or a company
"controlled" by an "investment company", within the meaning
of the Investment Company Act of 1940, as amended.
<PAGE> 35
1. The Borrower is a "gas utility company"
subsidiary of WICOR, a "holding company" exempt from
registration under Section 5 of the Public Utility Holding
Company Act of 1935, as amended, pursuant to Section 3(a)(1)
of such Act. The Borrower is likewise exempt from
registration under such Act.
1. Neither the Borrower nor any of its
Subsidiaries is engaged in the business of extending credit
for the purpose of buying or carrying margin stock (within
the meaning of Regulation U issued by the Board of Governors
of the Federal Reserve System), and no proceeds of any
Advance will be used to buy or carry any margin stock or to
extend credit to others for the purpose of buying or
carrying any margin stock, unless upon the application of
such proceeds the Borrower and its Subsidiaries shall be in
compliance with Regulation X issued by the Board of
Governors of the Federal Reserve System and shall not have
caused the Agent or any Lender to be in violation of said
Regulation U.
1. No ERISA Event has occurred or is reasonably
expected to occur with respect to any Plan which reasonably
could be expected to materially adversely affect the
financial condition, results of operations, operations or
prospects of the Borrower and its Subsidiaries or the
ability of the Borrower to perform its obligations
hereunder. Since the actuarial valuation date specified in
the most recent Schedule B (Actuarial Information) to the
annual report of Plans maintained by the Borrower (Form 5500
Series), if any, (i) there has been no material adverse
change in the funding status of the Plans referred to
therein which reasonably could be expected to materially
adversely affect the financial condition, results of
operations, operations or prospects of the Borrower and its
Subsidiaries or the ability of the Borrower to perform its
obligations hereunder and (ii) no "prohibited transaction"
has occurred with respect thereto which is reasonably
expected to result in a material liability to the Borrower.
Neither the Borrower nor any of its ERISA Affiliates has
incurred nor reasonably expects to incur any material
withdrawal liability under ERISA to any Multiemployer Plan.
<PAGE> 36
1. The Borrower and its Subsidiaries are in
compliance in all material respects with all applicable
Federal, state and local statutes, rules, regulations,
orders and other provisions of law relating to Hazardous
Materials, air emissions, water discharge, noise emission
and liquid disposal, and other environmental, health and
safety matters, other than those the non-compliance with
which would not have a material adverse effect (taking into
consideration all fines, penalties and sanctions that may be
imposed because of such non-compliance) on the condition
(financial or otherwise), results of operations, operations
or prospects of the Borrower or any of its Subsidiaries or
in the ability of the Borrower to perform its obligations
hereunder. Neither the Borrower nor any of its Subsidiaries
has received from any governmental authority any notice of
any material violation of any such statute, rule,
regulation, order or provision.
I. ARTICLE
COVENANTS OF THE BORROWER
A. SECTION Affirmative Covenants. So long as any
amount in respect of any Note shall remain unpaid or any
Lender shall have any Commitment hereunder, the Borrower
will, unless the Majority Lenders shall otherwise consent in
writing:
1. Preservation of Existence, Etc. Preserve and
maintain, and cause each of its Subsidiaries to preserve and
maintain, its corporate existence, material rights
(statutory and otherwise) and franchises, and take such
other action as may be necessary or advisable to preserve
and maintain its right to conduct its business in the states
where it shall be conducting its business.
1. Maintenance of Properties, Etc. Maintain,
and cause each of its Subsidiaries to maintain, good and
marketable title to all of its properties which are used or
useful in the conduct of its business, and preserve,
maintain, develop and operate, and cause each of its
Subsidiaries to preserve, maintain, develop and operate, in
substantial conformity with all laws and material
contractual obligations, all such properties in good working
order and condition, ordinary wear and tear excepted.
<PAGE> 37
1. Compliance with Laws, Etc. Comply, and cause
each of its Subsidiaries to comply, with the requirements of
all applicable laws, rules, regulations and orders, the
failure to comply with which could reasonably be expected to
materially adversely affect the financial condition, results
of operations, operations or prospects of the Borrower or
such Subsidiary, such compliance to include, without
limitation, paying before the same become delinquent all
taxes, assessments and governmental charges imposed upon it
or upon its property except to the extent diligently
contested in good faith and by appropriate proceedings and
for which adequate reserves for the payment thereof have
been established, and complying with the requirements of all
applicable Federal, state and local statutes, rules,
regulations, orders and other provisions of law relating to
Hazardous Materials, air emissions, water discharge, noise
emission and liquid disposal, and other environmental,
health and safety matters.
1. Insurance. Maintain, and cause each of its
Subsidiaries to maintain, insurance with financially sound
and reputable insurance companies or associations in such
amounts and covering such risks as are usually carried by
companies engaged in the same or similar businesses and
similarly situated.
1. Visitation Rights. At any reasonable time
and from time to time, upon reasonable advance notice,
permit the Agent or any of the Lenders or any agents or
representatives thereof (at the sole cost and expense of the
Lenders), to examine and make copies of and abstracts from
the records and books of account of, and visit the
properties of, the Borrower and any of its Subsidiaries, and
to discuss the affairs, finances and accounts of the
Borrower and any of its Subsidiaries with any of their
officers or directors and with their independent certified
public accountants.
1. Transactions with Affiliates. Except as
otherwise ordered by the Public Service Commission of
Wisconsin, conduct, and cause each of its Subsidiaries to
conduct, all transactions otherwise permitted under this
Agreement with any of their Affiliates on terms that are
fair and reasonable and no less favorable to the Borrower or
such Subsidiary than it would obtain in a comparable arm's-
length transaction with a Person not an Affiliate; provided,
however, that the foregoing shall not restrict the ability
of the Borrower or any of its Subsidiaries to provide
employment-related fringe benefits to any of its officers or
directors.
<PAGE> 38
1. Reporting Requirements. Furnish to each
Lender:
a) as soon as available and in any event within
45 days after the end of each of the first three quarters of
each fiscal year of the Borrower, a consolidated balance
sheet of the Borrower and its Subsidiaries as at the end of
such quarter and consolidated statements of income, retained
earnings and cash flows of the Borrower and its Subsidiaries
for the period commencing at the end of the previous fiscal
year and ending with the end of such quarter, all in
reasonable detail and duly certified by the chief financial
officer of the Borrower as fairly presenting the financial
condition of the Borrower and its Subsidiaries as at such
date and the results of operations of the Borrower and its
Subsidiaries for the periods ended on such date, all in
accordance with generally accepted accounting principles
consistently applied (modified as described in Section
1.03), together with a certificate of the chief financial
officer of the Borrower (A) demonstrating and certifying
compliance by the Borrower with the covenant set forth in
Section 5.01(l) and (B) stating that no Event of Default or
Unmatured Default has occurred and is continuing or, if an
Event of Default or Unmatured Default has occurred and is
continuing, a statement as to the nature thereof and the
action which the Borrower has taken and proposes to take
with respect thereto;
<PAGE> 39
a) as soon as available and in any event within
90 days after the end of each fiscal year of the Borrower, a
copy of the annual report for such year for the Borrower and
its Subsidiaries, containing financial statements for such
year certified without qualification by Arthur Andersen &
Co. or other independent public accountants acceptable to
the Majority Lenders and, to the extent not contained in
such annual report, the consolidated balance sheet of the
Borrower and its Subsidiaries as at the end of such fiscal
year and the consolidated statements of income, retained
earnings and cash flows of the Borrower and its Subsidiaries
for such fiscal year, certified by the chief financial
officer of the Borrower as fairly presenting the financial
condition of the Borrower and its Subsidiaries as at such
date and the results of operations of the Borrower and its
Subsidiaries for such fiscal year, all in accordance with
generally accepted accounting principles consistently
applied (modified as described in Section 1.03), together
with a certificate of the chief financial officer of the
Borrower (A) demonstrating and certifying compliance by the
Borrower with the covenant set forth in Section 5.01(l) and
(B) stating that no Event of Default or Unmatured Default
has occurred and is continuing or, if an Event of Default or
Unmatured Default has occurred and is continuing, a
statement as to the nature thereof and the action which the
Borrower has taken and proposes to take with respect
thereto;
a) as soon as possible and in any event within
five days after the occurrence of each ERISA Event, each
Event of Default and each Unmatured Default, continuing on
the date of such statement, a statement of the chief
financial officer of the Borrower setting forth details of
such ERISA Event, Event of Default or Unmatured Default and
the action which the Borrower has taken and proposes to take
with respect thereto;
a) promptly after receipt thereof by the
Borrower or any of its ERISA Affiliates from the PBGC copies
of each notice received by the Borrower or such ERISA
Affiliate of the PBGC's intention to terminate any Plan of
the Borrower or such ERISA Affiliate or to have a trustee
appointed to administer any such Plan;
<PAGE> 40
a) promptly after receipt thereof by the
Borrower or any ERISA Affiliate from a Multiemployer Plan
sponsor, a copy of each notice received by the Borrower or
such ERISA Affiliate concerning the imposition or amount of
withdrawal liability in an aggregate principal amount of at
least $250,000 pursuant to Section 4202 of ERISA in respect
of which the Borrower or such ERISA Affiliate is reasonably
expected to be liable;
a) promptly after the Borrower becomes aware of
the occurrence thereof, notice of all actions, suits,
proceedings or other events (A) of the type described in
Section 4.01(f) or (B) for which the Agent or the Lenders
will be entitled to indemnity under Section 8.04(c);
a) promptly after the sending or filing thereof,
copies of all reports which the Borrower sends to any of its
security holders, and copies of all reports and registration
statements which the Borrower or any of its Subsidiaries
files with the Securities and Exchange Commission or any
national securities exchange;
a) promptly after requested, such other
information respecting the business, properties, results of
operations, prospects, condition or operations, financial or
otherwise, of the Borrower or any of its Subsidiaries as any
Lender through the Agent may from time to time reasonably
request; and
a) promptly after the Borrower becomes aware of
the occurrence thereof, notice of any change in the Moody's
Rating or the S&P Rating.
1. Use of Proceeds. Use all Borrowings for
general corporate purposes (subject to the terms and
conditions of this Agreement), including, without
limitation, as a commercial paper backstop, provided, that
the proceeds of any Advance shall not be used, directly or
indirectly, to purchase or carry margin stock (within the
meaning of Regulation U issued by the Board of Governors of
the Federal Reserve System).
1. Keeping of Books. Keep, and cause each of
its Subsidiaries to keep, proper books of record and
account, in which full and correct entries shall be made of
all financial transactions and the assets and business of
the Borrower and each of its Subsidiaries in accordance with
generally accepted accounting principles consistent with
those applied in the preparation of the financial statements
referred to in Section 4.01(e) hereof.
<PAGE> 41
1. Payment of Taxes, Etc. Pay and discharge,
and cause each of its Subsidiaries to pay and discharge,
before the same shall become delinquent, all taxes,
assessments and governmental charges, royalties or levies
imposed upon the Borrower or such Subsidiary or upon the
property of the Borrower or such Subsidiary, except to the
extent the same are being contested in good faith by
appropriate proceedings and the Borrower or such Subsidiary
has set aside adequate reserves in accordance with generally
accepted accounting principles for the payment thereof.
1. Performance and Compliance with Other
Agreements. Perform and comply, and cause each of its
Subsidiaries to perform and comply, with each of the
material provisions of each indenture, credit agreement,
contract or other agreement by which the Borrower or its
properties or such Subsidiary or its properties are bound,
non-performance or non-compliance with which could
reasonably be expected to have a materially adverse effect
upon the financial condition, results of operations,
operations or prospects of the Borrower or such Subsidiary
or in any way affect the ability of the Borrower to perform
its obligations under this Agreement or under the Notes.
1. Debt-to-Capitalization Ratio. Maintain at
all times a Leverage Ratio of 0.65 to 1.00 or less.
1. Further Assurances. At the expense of the
Borrower, promptly execute and deliver, or cause to be
promptly executed and delivered, all further instruments and
documents, and take and cause to be taken all further
actions, that may be necessary or that the Majority Lenders
through the Agent may reasonably request to enable the
Lenders and the Agent to enforce the terms and provisions of
this Agreement and to exercise their rights and remedies
hereunder. In addition, the Borrower will use all
reasonable efforts to duly obtain Governmental Approvals
required from time to time on or prior to such date as the
same may become legally required, and thereafter to maintain
all such Governmental Approvals in full force and effect.
A. SECTION Negative Covenants. So long as any
amount in respect of any Note shall remain unpaid or any
Lender shall have any Commitment hereunder, the Borrower
will not, without the written consent of the Majority
Lenders:
<PAGE> 42
1. Liens, Etc. Create, incur, assume, or suffer
to exist, or permit any of its Subsidiaries to create,
incur, assume, or suffer to exist, any lien, security
interest or other charge or encumbrance, or any other type
of preferential arrangement, upon or with respect to any of
its properties, whether now owned or hereafter acquired, or
assign, or permit any of its Subsidiaries to assign, any
right to receive income, in each case to secure or provide
for the payment of any Indebtedness of any Person, other
than (i) purchase money liens or purchase money security
interests upon or in any property acquired or held by the
Borrower or any of its Subsidiaries in the ordinary course
of business to secure the purchase price of such property or
to secure Indebtedness incurred solely for the purpose of
financing the acquisition of such property; (ii) liens for
taxes or assessments or other governmental charges or levies
not yet due or the imposition or amount of which the
Borrower or any of its Subsidiaries is diligently contesting
in good faith by appropriate proceedings and for which
adequate reserves for payment thereof have been established;
(iii) pledges or deposits to secure performance in
connection with bids, tenders, contracts (other than
contracts for the payment of money) or leases to which the
Borrower or any of its Subsidiaries is a party, in each case
made in the ordinary course of business; (iv) materialmen's,
mechanics', carriers', workmen's, repairmen's or other
similar liens arising in the ordinary course of business, or
deposits to obtain the release of such liens; (v) liens or
security interests existing on such property at the time of
its acquisition (other than any such lien or security
interest created in contemplation of such acquisition);
(vi) liens or security interests to secure Indebtedness
under the Indenture; and (vii) liens and security interests
set forth on Schedule II hereto.
1. Indebtedness. Create, incur, assume, or
suffer to exist any Indebtedness if, immediately after
giving effect to such Indebtedness and the receipt and
application of any proceeds thereof, the Borrower would not
be in compliance with Section 5.01(l).
<PAGE> 43
1. Dividends, Etc. Declare or pay, directly or
indirectly, any dividend, payment or other distribution of
assets, properties, cash, rights, obligations or securities
on account of any share of any class of common stock of the
Borrower, or purchase, redeem, retire, or otherwise acquire
for value, directly or indirectly, any shares of any class
of common stock of the Borrower or any warrants, rights, or
options to acquire any such shares, now or hereafter
outstanding, or make any distribution of assets to any of
its common shareholders (any such dividend, payment,
distribution, purchase, redemption, retirement or
acquisition being hereinafter referred to as a "Restricted
Payment"), except (i) for so long as the Indenture is in
effect, the Borrower may make Restricted Payments to the
extent permitted by any applicable rate order issued by the
Public Service Commission of Wisconsin and the covenant set
forth in Article III of the Thirteenth Supplemental
Indenture without giving effect to any subsequent amendment
or modification thereof, the provisions of said Article III,
together with the definitions of all terms defined in the
Thirteenth Supplemental Indenture or the Indenture and used
in or otherwise applicable to said Article, being hereby
incorporated in this Agreement by reference as if such
provisions and definitions were set forth in full herein,
except that the phrase "Bonds of 1995 Series" used in said
Article III shall be deemed to include the Notes issued
pursuant to this Agreement, and (ii) from and after the date
that the Indenture ceases to be in effect, the Borrower may
make one or more Restricted Payments if immediately after
giving effect to any such Restricted Payment, the Borrower
would be in compliance with Section 5.01(l) and any
applicable rate order issued by the Public Service
Commission of Wisconsin.
1. Mergers, Etc. Merge or consolidate with or
into, or sell, convey, assign, transfer, lease or otherwise
dispose of (whether in one transaction or in a series of
transactions) all or substantially all its assets or any
Operating Entity (whether now owned or hereafter acquired)
to, any Person, or materially change the nature of its
business, or permit any of its Subsidiaries to do so, except
that any Subsidiary of the Borrower may merge or consolidate
with or into, or dispose of assets to, any other Subsidiary
of the Borrower and except that any Subsidiary of the
Borrower may merge into or dispose of assets to the
Borrower, provided in each case that, immediately after
giving effect to such proposed transaction, no Event of
Default or Unmatured Default would exist.
1. Intercompany Loans and Investments. Make any
loan to or investment in WICOR or WICOR Industries.
1. Guaranties. Create, incur or suffer to exist
any obligations of the type described in clause (vii) of the
definition of Indebtedness in respect of WICOR or WICOR
Industries.
<PAGE> 43
1. Compliance with ERISA. (i) Permit to exist
any "accumulated funding deficiency" (as defined in Section
412(a) of the Code), unless such deficiency exists with
respect to a Multiple Employer Plan or Multiemployer Plan
and the Borrower has no control over the reduction or
elimination of such deficiency, (ii) terminate, or permit
any ERISA Affiliate to terminate, any Plan of the Borrower
or such ERISA Affiliate so as to result in any material (in
the opinion of the Majority Lenders) liability of the
Borrower to the PBGC, or (iii) permit to exist any
occurrence of any reportable event (within the meaning of
Section 4043 of ERISA), or any other event or condition,
which presents a material (in the opinion of the Majority
Lenders) risk of such a termination by the PBGC of any Plan
of the Borrower or such ERISA Affiliate and such a material
liability to the Borrower.
I. ARTICLE
EVENTS OF DEFAULT
A. SECTION Events of Default. If any of the
following events (each an "Event of Default") shall occur
and be continuing:
1. The Borrower shall fail to pay any principal
of, or any interest on, any Note when the same becomes due
and payable; or
2. Any representation or warranty made by or on
behalf of the Borrower herein or by or on behalf of the
Borrower (or any of its officers) in connection with this
Agreement shall prove to have been incorrect in any material
respect when made or deemed made; or
1. The Borrower shall fail to perform or observe
(i) any term, covenant or agreement contained in Section
2.04, 5.01(a), 5.01(g)(iii), 5.01(h), 5.01(l) or 5.02, or
(ii) any other term, covenant or agreement contained in this
Agreement (other than obligations specifically set forth
elsewhere in this Section 6.01) on its part to be performed
or observed if the failure to perform or observe such other
term, covenant or agreement, if susceptible of remedy, shall
remain unremedied for 30 days after written notice thereof
shall have been given to the Borrower by the Agent or any
Lender; or
<PAGE> 45
1. The Borrower shall fail to pay any principal
of or premium or interest on any Indebtedness (other than
Indebtedness evidenced by the Notes) of the Borrower when
the same becomes due and payable (whether by scheduled
maturity, required prepayment, acceleration, demand or
otherwise), and such failure shall continue after the
applicable grace period, if any, specified in the agreement
or instrument relating to such Indebtedness; or any other
event shall occur or condition shall exist under any
agreement or instrument relating to any such Indebtedness
and shall continue after the applicable grace period, if
any, specified in such agreement or instrument, if the
effect of such event or condition is to accelerate, or to
permit the acceleration of, the maturity of such
Indebtedness; or any such Indebtedness shall be declared to
be due and payable, or required to be prepaid (other than by
a regularly scheduled required prepayment), prior to the
stated maturity thereof; or
1. The Borrower shall generally not pay its
debts as such debts become due, or shall admit in writing
its inability to pay its debts generally, or shall make a
general assignment for the benefit of creditors; or any
proceeding shall be instituted by or against the Borrower
seeking to adjudicate it a bankrupt or insolvent, or seeking
liquidation, winding up, reorganization, arrangement,
adjustment, protection, relief, or composition of it or its
debts under any law relating to bankruptcy, insolvency or
reorganization or relief of debtors, or seeking the entry of
an order for relief or the appointment of a receiver,
trustee, custodian or other similar official for it or for
any substantial part of its property and, in the case of any
such proceeding instituted against it (but not instituted by
it), such proceeding shall remain undismissed or unstayed
for a period of 45 days, any of the actions sought in such
proceeding (including, without limitation, the entry of an
order for relief against, or the appointment of a receiver,
trustee, custodian or other similar official for, it or for
any substantial part of its property) shall occur or the
Borrower shall consent to or acquiesce in any such
proceeding; or the Borrower shall take any corporate action
to authorize any of the actions set forth above in this
subsection (e); or
1. Any judgment or order for the payment of
money in excess of $5,000,000 shall be rendered against the
Borrower and either (i) enforcement proceedings shall have
been commenced by any creditor upon such judgment or order
or (ii) there shall be any period of 10 consecutive days
during which a stay of enforcement of such judgment or
order, by reason of a pending appeal or otherwise, shall not
be in effect; or
1. The Borrower's obligations under this
Agreement or any of the Notes shall become unenforceable, or
the Borrower, or any court or governmental or regulatory
body having jurisdiction over the Borrower, shall so assert
in writing; or
<PAGE> 46
1. Any ERISA Event shall have occurred with
respect to a Plan and, 30 days after notice thereof shall
have been given to the Borrower by the Agent or any Lender,
(i) such ERISA Event shall still exist and (ii) the sum
(determined as of the date of occurrence of such ERISA
Event) of the Insufficiency of such Plan and the
Insufficiency of any and all other Plans with respect to
which an ERISA Event shall have occurred and then exist (or,
in the case of a Plan with respect to which an ERISA Event
described in clauses (iii) through (vi) of the definition of
ERISA Event shall have occurred and then exist, the
liability related thereto) is equal to or greater than
$5,000,000; or
1. Any Governmental Approval shall be rescinded,
revoked, otherwise terminated, or amended or modified in any
manner which is materially adverse to the interests of the
Lenders and the Agent; or
1. The Borrower shall cease to be a direct,
wholly-owned Subsidiary of WICOR;
then, and in any such event, the Agent (i) shall at the request,
or may with the consent, of the holders of at least 66 % in
principal amount of the A Advances then outstanding or, if no A
Advances are then outstanding, Lenders having at least 66 % of
the Commitments (without giving effect to any B Reduction), by
notice to the Borrower, declare the obligation of each Lender to
make Advances to be terminated, whereupon the same shall
forthwith terminate, and (ii) shall at the request, or may with
the consent, of the holders of at least 66 % in principal amount
of the Advances then outstanding or, if no Advances are then
outstanding, Lenders having at least 66 % of the Commitments, by
notice to the Borrower, declare the Notes, all interest thereon
and all other amounts payable under this Agreement to be
forthwith due and payable, whereupon the Notes, all such interest
and all such amounts shall become and be forthwith due and
payable, without presentment, demand, protest or further notice
of any kind, all of which are hereby expressly waived by the
Borrower; provided, however, that in the event of an actual or
deemed entry of an order for relief with respect to the Borrower
under the Federal Bankruptcy Code, (A) the Commitments and the
obligation of each Lender to make Advances shall automatically be
terminated and (B) the Notes, all such interest and all such
amounts shall automatically become and be due and payable,
without presentment, demand, protest or any notice of any kind,
all of which are hereby expressly waived by the Borrower.
<PAGE> 47
I. ARTICLE
THE AGENT
A. SECTION Authorization and Action. Each Lender
hereby appoints and authorizes the Agent to take such action
as agent on its behalf and to exercise such powers under
this Agreement as are delegated to the 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
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 Agent shall not be required to take any
action which exposes the Agent to personal liability or
which is contrary to this Agreement or applicable law. The
Agent agrees to give to each Lender prompt notice of each
notice given to it by the Borrower pursuant to the terms of
this Agreement.
A. SECTION Agent's Reliance, Etc. Neither the
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 gross negligence or
willful misconduct. Without limitation of the generality of
the foregoing, the Agent: (i) to the extent of any payments
to be disbursed by the Agent, may treat the payee of any
Note as the holder thereof until the Agent receives and
accepts an Assignment and Acceptance entered into by the
Lender which is the payee of such Note, as assignor, and an
assignee of such Lender, as provided in Section 8.07;
(ii) may consult with legal counsel (including counsel for
the Borrower), 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; (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.
<PAGE> 48
A. SECTION Citibank and Affiliates. With respect
to its Commitment, 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 Agent; and the terms
"Bank" or "Banks" and "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 or Affiliates
and any Person who may do business with or own securities of
the Borrower or any such Subsidiary or Affiliate, all as if
Citibank were not the Agent and without any duty to account
therefor to the Lenders.
A. SECTION Lender Credit Decision. Each Lender
acknowledges that it has, independently and without reliance
upon the Agent or any other Lender and based on the
financial statements referred to in Section 4.01(e) 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
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.
A. SECTION Indemnification. The Lenders agree to
indemnify the Agent (to the extent not reimbursed by the
Borrower), ratably according to the respective principal
amounts of the A Notes then held by each of them (or if no A
Notes are at the time outstanding or if any A Notes are held
by Persons which are not Lenders, ratably according to the
respective 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 Agent in
any way relating to or arising out of this Agreement or any
action taken or omitted by the 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 Agent's gross negligence or willful
misconduct. Without limitation of the foregoing, each
Lender agrees to reimburse the Agent promptly upon demand
for its ratable share of any out-of-pocket expenses
(including counsel fees) incurred by the 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 Agent is not reimbursed
for such expenses by the Borrower, provided, that no Lender
shall be liable for any portion of such out-of-pocket
expenses (including counsel fees) resulting from the Agent's
gross negligence or willful misconduct.
<PAGE> 49
A. SECTION Successor Agent. The 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, with any such
resignation or removal to become effective only upon the
appointment of a successor Agent pursuant to this Section
7.06. Upon any such resignation or removal, the Majority
Lenders shall have the right to appoint a successor Agent.
Such successor shall be subject to the approval of the
Borrower, such approval not to be unreasonably withheld or
delayed, provided that such approval shall not be necessary
if at the time such successor is appointed there shall have
occurred and be continuing an Event of Default or an
Unmatured Default. If no successor Agent shall have been so
appointed by the Majority Lenders, and shall have accepted
such appointment, within 30 days after the retiring Agent's
giving of notice of resignation or the Majority Lenders'
removal of the retiring Agent, then the retiring Agent may,
on behalf of the Lenders, appoint a successor Agent, which
shall be a Lender or shall be another commercial bank or
trust company 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 Agent hereunder by a
successor Agent, such successor Agent shall thereupon
succeed to and become vested with all the rights, powers,
privileges and duties of the retiring Agent, and the
retiring Agent shall be discharged from its duties and
obligations under this Agreement. After any retiring
Agent's resignation or removal hereunder as Agent, the
provisions of this Article VII shall inure to its benefit as
to any actions taken or omitted to be taken by it while it
was Agent under this Agreement.
I. ARTICLE
MISCELLANEOUS
A. SECTION Amendments, Etc. No amendment or waiver
of any provision of this Agreement or the 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 amendment,
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, do
any of the following: (a) waive, modify or eliminate any of
the conditions specified in Section 3.01, 3.02 or, during
any period of time when offers to make B Advances shall be
outstanding and shall not have been accepted or canceled,
3.03, (b) increase the Commitments of the Lenders or subject
the Lenders to any additional obligations, (c) reduce the
principal of, or interest on, the A Notes, any Applicable
Margin 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 percentage 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 8.01; and provided,
further, that no amendment, waiver or consent shall, unless
in writing and signed by the Agent in addition to the
Lenders required above to take such action, affect the
rights or duties of the Agent under this Agreement or any
Note; and provided, further, however, that no amendment,
waiver or consent shall affect the terms or provisions of
any B Note or any B Advance unless such amendment, waiver or
consent is in writing and signed by the Lender holding such
B Note or to which such B Advance is payable in addition to
the Lenders required above to take such action.
SECTION Notices, Etc. All notices and other
communications provided for hereunder shall be in writing
(including telecopier, telegraphic, telex or cable communication)
and <PAGE> 50
mailed, telecopied, telegraphed, telexed, cabled or delivered, if
to the Borrower, at its address at 626 East Wisconsin Avenue,
Milwaukee, Wisconsin 53202, (telecopy no. 414-291-6361),
Attention: Vice President and Treasurer; if to any Bank, at its
Domestic Lending Office specified opposite its name on Schedule I
hereto; if to any other Lender, at its Domestic Lending Office
specified in the Assignment and Acceptance pursuant to which it
became a Lender; and if to the Agent, at its address at 200 S.
Wacker Drive, Chicago, Illinois 60606, Attention: H. Peter
Koesler, with copy to: Citicorp Securities, Inc., Two Penns Way,
Suite 200, New Castle, Delaware 19720, Attention: Loan Disclosure
or, as to each party, at such other address as shall be
designated by such party in a written notice to the other
parties. All such notices and communications shall, when mailed,
telecopied, telegraphed, telexed or cabled, be effective when
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 Agent pursuant to Article II or VII shall not be effective
until received by the Agent.
A. SECTION No Waiver; Remedies. No failure on the
part of any Lender or the 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.
1. SECTION Costs, Expenses, Taxes and
Indemnification. The Borrower agrees to pay on demand all
costs and expenses 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 Agent with respect thereto and with
respect to advising the 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), 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 8.04(a). In
addition, the Borrower shall pay any and all stamp and other
taxes payable or determined to be payable in connection with
the execution and delivery of this Agreement, the Notes and
the other documents to be delivered hereunder, and agrees to
save the Agent and each Lender harmless from and against any
and all liabilities with respect to or resulting from any
delay by the Borrower in paying or omission to pay such
taxes.
<PAGE> 51
2. If any payment of principal of, or Conversion of, any
Eurodollar Rate Advance is made other than on the last day of the
Interest Period for such Advance, as a result of a payment or
Conversion pursuant to Section 2.09(e), 2.10, 2.11 or 2.13 or
acceleration of the maturity of the Notes pursuant to Section
6.01 or for any other reason, the Borrower shall, upon demand by
any Lender (with a copy of such demand to the Agent), pay to the
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 or Conversion, including,
without limitation, any loss (including 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 A Advance.
1. The Borrower hereby agrees to indemnify and
hold each Lender, the Agent and their respective officers,
directors, employees, agents, professional advisors and
affiliates (each, an "Indemnified Person") harmless from and
against any and all claims, damages, losses, liabilities,
costs or expenses (including, without limitation, reasonable
attorney's fees and expenses, whether or not such
Indemnified Person is named as a party to any proceeding or
is otherwise subjected to judicial or legal process arising
from any such proceeding) which any of them may incur or
which may be claimed against any of them by any Person
(except for such claims, damages, losses, liabilities, costs
and expenses resulting from such Indemnified Person's gross
negligence or willful misconduct):
a) by reason of or in connection with the
execution, delivery or performance of this Agreement, the
Notes or any transaction contemplated hereby or thereby, or
the use by the Borrower or any of its Subsidiaries of the
proceeds of any Advance;
a) in connection with any documentary taxes,
assessments or charges made by any governmental authority by
reason of the execution and delivery of this Agreement or
the Notes; or
a) in connection with or resulting from the
utilization, storage, disposal, treatment, generation,
transportation, release or ownership of any Hazardous
Materials (A) at, upon, or under any property of the
Borrower or any of its Affiliates or (B) by or on behalf of
the Borrower or any of its Affiliates at any time and in any
place.
1. The Borrower's obligations under this Section
8.04 shall survive the repayment of all amounts owing to the
Lenders under the Notes and the termination of the
Commitments. If and to the extent that the obligations of
the Borrower under this Section 8.04 are unenforceable for
any reason, the Borrower agrees to make the maximum
contribution to the payment and satisfaction thereof which
is permissible under applicable law.
<PAGE> 52
1. SECTION Right of Set-off. Upon (i) the
occurrence and during the continuance of any Event of
Default and (ii) the making of the request or the granting
of the consent specified by Section 6.01 to authorize the
Agent to declare the Notes due and payable pursuant to the
provisions of Section 6.01, each Lender 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 to or for the credit or the account of the
Borrower against any and all of the obligations of the
Borrower now or hereafter existing under this Agreement and
any Note held by such Lender, whether or not such Lender
shall have made any demand under this Agreement or such Note
and although such obligations may be unmatured. Each Lender
agrees promptly to notify the Borrower after any such set-
off and application made by such Lender, provided that the
failure to give such notice shall not affect the validity of
such set-off and application. The rights of each Lender
under this Section are in addition to other rights and
remedies (including, without limitation, other rights of
set-off) which such Lender may have.
2. The Borrower agrees that it shall have no
right of set-off, deduction or counterclaim in respect of
its obligations hereunder, and that the obligations of the
Lenders hereunder are several and not joint. Nothing
contained herein shall constitute a relinquishment or waiver
of the Borrower's rights to any claim arising under this
Agreement that the Borrower may have against the Agent or
any Lender for the Agent's or such Lender's, as the case may
be, gross negligence or wilful misconduct, but no Lender
shall be liable to the Borrower for the conduct of the Agent
or any other Lender, and the Agent shall not be liable to
the Borrower for the conduct of any Lender.
A. SECTION Binding Effect. This Agreement shall
become effective when it shall have been executed by the
Borrower and the Agent and when the Agent shall have been
notified in writing by each Bank that such Bank has executed
it and thereafter shall be binding upon and inure to the
benefit of the Borrower, the Agent and each Lender and their
respective successors and assigns, except that the Borrower
shall not have the right to assign its rights or obligations
hereunder or any interest herein without the prior written
consent of all the Lenders.
<PAGE> 53
1. SECTION Assignments and Participations. Each
Lender may assign to one or more banks or financial
institutions all or a portion of its rights and obligations
under this Agreement (including, without limitation, all or
a portion of its Commitment, the A Advances owing to it and
the A Note or A Notes held by it); provided, however, that
(i) the Borrower shall have consented to such assignment
(such consent not to be unreasonably withheld or delayed) by
signing the Assignment and Acceptance referred to in clause
(iii) below, (ii) each such assignment shall be of a
constant, and not a varying, percentage of all of the
assigning Lender's rights and obligations under this
Agreement (other than any B Advances or B Notes) and
(iii) the parties to each such assignment shall execute and
deliver to the Agent, for its acceptance and recording in
the Register, an Assignment and Acceptance, together with
any A Note or A Notes subject to such assignment and a
processing and recordation fee of $2,500 (plus an amount
equal to out-of-pocket legal expenses of the Agent,
estimated by the Agent and advised to such parties), payable
by the assigning Lender or the assignee, as agreed upon by
such parties. 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). Notwithstanding anything to the
contrary contained in this Agreement, any Lender may at any
time assign all or any portion of the Advances owing to it
to any Affiliate of such Lender. No such assignment, other
than to an Affiliate of such Lender consented to by the
Borrower (such consent not to be unreasonably withheld or
delayed), shall release the assigning Lender from its
obligations hereunder.
<PAGE> 54
1. 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 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(e) 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
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 appoints and authorizes the
Agent to take such action as agent on its behalf and to
exercise such powers under this Agreement as are delegated
to the Agent by the terms hereof, together with such powers
as are reasonably incidental thereto; and (vi) 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.
1. The Agent shall maintain at its address
referred to in Section 8.02 a copy of each Assignment and
Acceptance delivered to and accepted by it and a register
for the recordation of the names and addresses of the
Lenders and the Commitment of, and principal amount of the A
Advances owing to, each Lender from time to time (the
"Register"). The entries in the Register shall be
conclusive and binding for all purposes, absent manifest
error, and the Borrower, the Agent and the Lenders may treat
each Person whose name is recorded in the Register as a
Lender hereunder for all 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.
<PAGE> 55
1. Upon its receipt of an Assignment and
Acceptance executed by an assigning Lender and an assignee,
together with any A Note or A Notes subject to such
assignment, the Agent shall, if such Assignment and
Acceptance has been completed and is in substantially the
form of Exhibit C hereto, and has been signed by the
Borrower, (i) accept such Assignment and Acceptance,
(ii) record the information contained therein in the
Register and (iii) give prompt notice of such recordation 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 Agent in exchange for the
surrendered A Note or A Notes a new A Note to the order of
such assignee in an 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. Such new
A Note or A Notes shall be in an aggregate principal amount
equal to the aggregate principal amount of such surrendered
A Note or A Notes, shall be dated the effective date of such
Assignment and Acceptance and shall otherwise be in
substantially the form of Exhibit A-1 hereto.
1. Each Lender may assign to one or more banks
or other financial institutions any B Note or B Notes held
by it, without the consent of the Borrower.
2. Each Lender may sell participations to one or
more banks, financial institutions or other entities in 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 remain the
holder of any such Note for all purposes of this Agreement,
(iv) the Borrower, the 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) the voting rights of any holder of
any participation shall be limited to decisions that only do
any of the following: (A) subject the participant to any
additional obligation, (B) reduce the principal of or
interest on the Notes or any fees or other amounts payable
hereunder, or (C) postpone any date fixed for the payment of
principal of or interest on the Notes or any fees or other
amounts payable hereunder. The Borrower agrees that any
purchaser of a participation may, to the fullest extent
permitted by law, exercise all of its rights of payment
(including the right of set-off) with respect to such
participation as fully as if such purchaser were the direct
creditor of the Borrower in the amount of such
participation.
<PAGE> 56
1. Any Lender may, in connection with any
assignment or participation or proposed assignment or
participation pursuant to this Section 8.07, disclose to the
assignee or participant or proposed assignee or participant,
any information relating to the Borrower furnished to such
Lender by or on behalf of the Borrower; provided that, prior
to any such disclosure, the assignee or participant or
proposed assignee or participant shall agree to preserve the
confidentiality of any confidential information relating to
the Borrower received by it from such Lender.
1. Anything in this Section 8.07 to the contrary
notwithstanding, any Lender may assign and pledge all or any
portion of its Commitment and the Advances owing to it to
any Federal Reserve Bank (and its transferees) as collateral
security pursuant to Regulation A of the Board of Governors
of the Federal Reserve System and any Operating Circular
issued by such Federal Reserve Bank. No such assignment
shall release the assigning Lender from its obligations
hereunder.
A. SECTION Consent to Jurisdiction. The Borrower
hereby irrevocably submits to the non-exclusive jurisdiction
of any New York State or Federal court sitting in New York
County, State of New York, for any action or proceeding
arising out of or relating to this Agreement or any Note,
and the Borrower hereby irrevocably agrees that all claims
in respect of any such action or proceeding may be heard and
determined in such New York State court or, to the extent
permitted by law, in such Federal court. The Borrower
hereby irrevocably waives, to the fullest extent it may
effectively do so, the defense of an inconvenient forum to
the maintenance of any such action or proceeding. The
Borrower further irrevocably consents to the service of
process out of any of the aforementioned courts in any such
action or proceeding by the mailing of copies thereof by
registered or certified mail, postage prepaid, to the
address of the Borrower specified in Section 8.02. A final
judgment in any such action shall be conclusive and may be
enforced in other jurisdictions. Nothing herein shall
affect the right of any party to serve legal process in any
manner permitted by law or affect its right to bring any
action in any other court.
A. SECTION WAIVER OF JURY TRIAL. THE AGENT, THE
LENDERS AND THE BORROWER HEREBY KNOWINGLY, VOLUNTARILY AND
INTENTIONALLY WAIVE ANY RIGHTS THEY MAY HAVE TO A TRIAL BY
JURY IN RESPECT OF ANY LITIGATION BASED HEREON, OR ARISING
OUT OF, UNDER, OR IN CONNECTION WITH, THIS AGREEMENT OR THE
NOTES, OR ANY COURSE OF CONDUCT, COURSE OF DEALING,
STATEMENTS (WHETHER VERBAL OR WRITTEN), OR ACTIONS OF THE
AGENT, SUCH LENDERS OR THE BORROWER. THIS PROVISION IS A
MATERIAL INDUCEMENT FOR THE AGENT AND THE LENDERS ENTERING
INTO THIS AGREEMENT.
A. SECTION Governing Law. This Agreement and the
Notes shall be governed by, and construed in accordance
with, the laws of the State of New York.
A. SECTION Headings. Article and Section headings
in this Agreement are included herein for convenience of
reference only and shall not constitute a part of this
Agreement for any other purpose.
A. SECTION Relation of the Parties; No Beneficiary.
No term, provision or requirement, whether express or
implied, of this Agreement or any Note, or actions taken or
to be taken by any party hereunder or thereunder, shall be
construed to create a partnership, association, or joint
venture between such parties or any of them. No term or
provision of this Agreement or any Note shall be construed
to confer a benefit upon, or grant a right or privilege to,
any Person other than the parties thereto.
A. SECTION Execution in Counterparts. 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.
<PAGE> 57
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.
WISCONSIN GAS COMPANY
By
Title:
CITIBANK, N.A.,
as Agent
By
Vice President
[Bank Signature Pages Omitted]
<PAGE> 58
TABLE OF CONTENTS
Page
ARTICLE I DEFINITIONS AND ACCOUNTING TERMS
SECTION 1.01. Certain Defined Terms 1
SECTION 1.02. Computation of Time Periods 13
SECTION 1.03. Accounting Terms 13
SECTION 1.04. Computations of Outstandings 13
ARTICLE II AMOUNTS AND TERMS OF THE ADVANCES
SECTION 2.01. The A Advances 13
SECTION 2.02. Making the A Advances 14
SECTION 2.03. The B Advances 14
SECTION 2.04. Fees 18
SECTION 2.05. Reduction of the Commitments 18
SECTION 2.06. Repayment of A Advances 18
SECTION 2.07. Interest on A Advances 18
SECTION 2.08. Additional Interest on Eurodollar Rate Advances
19
SECTION 2.09. Interest Rate Determination 19
SECTION 2.10. Voluntary Conversion of A Advances 20
SECTION 2.11. Prepayments of A Advances 21
SECTION 2.12. Increased Costs 21
SECTION 2.13. Illegality 22
SECTION 2.14. Payments and Computations 22
SECTION 2.15. Taxes 23
SECTION 2.16. Sharing of Payments, Etc 25
ARTICLE III CONDITIONS OF LENDING
SECTION 3.01. Conditions Precedent to Closing 26
SECTION 3.02. Conditions Precedent to Each A Borrowing 27
SECTION 3.03. Conditions Precedent to Each B Borrowing 28
SECTION 3.04. Reliance on Certificates 28
ARTICLE IV REPRESENTATIONS AND WARRANTIES
SECTION 4.01. Representations and Warranties of the Borrower
29
ARTICLE V COVENANTS OF THE BORROWER
SECTION 5.01. Affirmative Covenants 31
SECTION 5.02. Negative Covenants 35
ARTICLE VI EVENTS OF DEFAULT
SECTION 6.01. Events of Default 37
ARTICLE VII THE AGENT
<PAGE> 59
SECTION 7.01. Authorization and Action 40
SECTION 7.02. Agent's Reliance, Etc 40
SECTION 7.03. Citibank and Affiliates 40
SECTION 7.04. Lender Credit Decision 41
SECTION 7.05. Indemnification 41
SECTION 7.06. Successor Agent 41
ARTICLE VIII MISCELLANEOUS
SECTION 8.01. Amendments, Etc 42
SECTION 8.02. Notices, Etc 42
SECTION 8.03. No Waiver; Remedies 43
SECTION 8.04. Costs, Expenses, Taxes and Indemnification 43
SECTION 8.05. Right of Set-off 44
SECTION 8.06. Binding Effect 45
SECTION 8.07. Assignments and Participations 45
SECTION 8.08. Consent to Jurisdiction 48
SECTION 8.09. WAIVER OF JURY TRIAL 48
SECTION 8.10. Governing Law 48
SECTION 8.11. Headings 48
SECTION 8.12. Relation of the Parties; No Beneficiary 48
SECTION 8.13. Execution in Counterparts 48
Schedule I - Lending Offices
Schedule II - Existing Liens and Security Interests
Exhibit A-1 - Form of A Note
Exhibit A-2 - Form of B Note
Exhibit B-1 - Notice of A Borrowing
Exhibit B-2 - Notice of B Borrowing
Exhibit B-3 - Notice of Conversion
Exhibit C - Form of Assignment and Acceptance
Exhibit D - Form of Opinion of Robert A. Nuernberg
Exhibit E - Form of Opinion of Foley & Lardner
Exhibit F - Form of Opinion of King & Spalding
<TABLE> <S> <C>
<ARTICLE> UT
<LEGEND>
This schedule contains summary financial information extracted from the
Wisconsin Gas Company FORM 10-Q for the nine months ended September 30, 1997 and
is qualified in its entirety by reference to such financial statements and the
related footnotes.
</LEGEND>
<MULTIPLIER> 1,000
<S> <C>
<PERIOD-TYPE> 9-MOS
<FISCAL-YEAR-END> DEC-31-1997
<PERIOD-END> SEP-30-1997
<BOOK-VALUE> PER-BOOK
<TOTAL-NET-UTILITY-PLANT> 377,896
<OTHER-PROPERTY-AND-INVEST> 0
<TOTAL-CURRENT-ASSETS> 132,025
<TOTAL-DEFERRED-CHARGES> 158,421
<OTHER-ASSETS> 0
<TOTAL-ASSETS> 668,342
<COMMON> 9
<CAPITAL-SURPLUS-PAID-IN> 119,858
<RETAINED-EARNINGS> 89,845
<TOTAL-COMMON-STOCKHOLDERS-EQ> 209,712
0
0
<LONG-TERM-DEBT-NET> 150,606
<SHORT-TERM-NOTES> 0
<LONG-TERM-NOTES-PAYABLE> 150,000
<COMMERCIAL-PAPER-OBLIGATIONS> 31,525
<LONG-TERM-DEBT-CURRENT-PORT> 2,000
0
<CAPITAL-LEASE-OBLIGATIONS> 0
<LEASES-CURRENT> 0
<OTHER-ITEMS-CAPITAL-AND-LIAB> 274,499
<TOT-CAPITALIZATION-AND-LIAB> 668,342
<GROSS-OPERATING-REVENUE> 378,059
<INCOME-TAX-EXPENSE> 10,888
<OTHER-OPERATING-EXPENSES> 340,870
<TOTAL-OPERATING-EXPENSES> 351,758
<OPERATING-INCOME-LOSS> 26,301
<OTHER-INCOME-NET> 470
<INCOME-BEFORE-INTEREST-EXPEN> 26,771
<TOTAL-INTEREST-EXPENSE> 9,100
<NET-INCOME> 17,671
0
<EARNINGS-AVAILABLE-FOR-COMM> 17,671
<COMMON-STOCK-DIVIDENDS> 16,500
<TOTAL-INTEREST-ON-BONDS> 379
<CASH-FLOW-OPERATIONS> 71,600
<EPS-PRIMARY> 0
<EPS-DILUTED> 0
</TABLE>
