FILE NO. 70-8367 U-1/A
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
AMENDMENT NO. 1 TO
FORM U-1
DECLARATION WITH RESPECT TO PROPOSED AMENDMENTS
TO REVOLVING CREDIT AGREEMENT OF
PUBLIC SERVICE COMPANY OF NEW HAMPSHIRE
Under
THE PUBLIC UTILITY HOLDING COMPANY ACT OF 1935
Public Service Company of New Hampshire
1000 Elm Street
Manchester, New Hampshire 03105
(Names of companies filing this statement and addresses
of principal executive offices)
NORTHEAST UTILITIES
(Name of top registered holding company)
Robert P. Wax, Esq.
Vice President, Secretary and General Counsel
Northeast Utilities Service Company
Selden Street
Berlin, Connecticut 06037-0218
(Name and address of agent for service)
The Commission is requested to mail signed copies of all orders, notices and
communications to:
John B. Keane Jeffrey C. Miller, Esq.
Vice President and Assistant General Counsel
Treasurer Northeast Utilities Service Company
Northeast Utilities Service Company Selden Street
Selden Street Berlin, Connecticut 06037
Berlin, Connecticut 06037
Richard C. MacKenzie, Esq.
Day, Berry & Howard
CityPlace
Hartford, Connecticut 06103-3499
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Public Service Company of New Hampshire hereby amends its declaration to
read as shown in Attachment 1 hereto.
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Attachment 1 to
Amendment No. 1
ITEM 1
DESCRIPTION OF PROPOSED TRANSACTION
1. Public Service Company of New Hampshire ("PSNH"), a wholly owned
public utility subsidiary of Northeast Utilities ("NU"), a public utility
holding company registered under the Public Utility Holding Company Act of
1935, as amended (the "Act"), submits this declaration (the "Declaration")
pursuant to Sections 6(a) and 7 of the Act and Rule 50 thereunder with
respect to the amendment and extension of the term of the Revolving Credit
Agreement dated as of May 1, 1991 among PSNH, the banks named therein (the
"Banks"), Bankers Trust Company, Chemical Bank and Citibank, N.A., as Co-
Agents, and Chemical Bank, as Administrative Agent (the "Revolving Credit
Agreement"). The Revolving Credit Agreement was entered into by PSNH in
connection with PSNH's reorganization from bankruptcy on May 16, 1991 and
prior to its acquisition by NU on June 5, 1992. As discussed further in
paragraph 4, the transactions contemplated by the Revolving Credit Agreement
have been approved by the Commission. See File No. 70-8048. Northeast
Utilities, H.C.A. Rel. No. 25710 (December 16, 1992).
2. Under the Revolving Credit Agreement, PSNH has commitments from the
Banks for an aggregate of $125 million in short-term borrowings. PSNH's
obligations under the Revolving Credit Agreement are secured by a second
mortgage on certain of PSNH's assets. PSNH pays quarterly to each
participating Bank a facility fee (the "Facility Fee") equal to 25 basis
points per annum of that Bank's commitment, and it pays an agency fee to each
of the co-agents and the administrative agent as agreed to from time to time.
Presently, the Revolving Credit Agreement expires on May 14, 1994.
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3. Interest on borrowings under the Revolving Credit Agreement accrues
on one or more of four bases, at PSNH's option. The first is a "Eurodollar
Rate" equal to the average of the co-agents' London interbank offered rates
plus a margin of 50 basis points. The second interest rate option is a "CD
Rate" equal to the average of the co-agents' certificate of deposit rates
plus a margin of 87.5 basis points. The third interest rate option is an
"Alternate Base Rate" equal to the greater of Chemical Bank's prime lending
rate or the Federal Funds Rate in effect plus a margin of 50 basis points.
The final interest rate option is a rate bid by some or all of the
participating banks in a competitive bid procedure. The margins on
Eurodollar Rate, CD Rate and Alternate Base Rate borrowings increase by 25
basis points if either Standard & Poor's Corporation ("S&P") or Moody's
Investor Service, Inc. fails to give PSNH's first mortgage bonds an
investment grade rating, and by 37.5 basis points if the advance on which
that interest is accruing would be considered a "Highly Leveraged
Transaction" under applicable banking regulations. On March 1, 1994, S&P
downgraded its rating of PSNH's first mortgage bonds to "BB+," which is not
an investment grade rating, so the 25 basis point additional margin is
currently in effect. The reason given by S&P for the downgrade was PSNH's
weak financial profile and below average business position. PSNH and NU have
conveyed their disagreement with the downgrade to S&P, citing among other
factors PSNH's improving financial condition.
4. Borrowings under the Eurodollar Rate option can have maturities of
one, two, three or six months. Borrowings under the CD Rate option can have
maturities of 30, 60, 90 or 180 days. Borrowings under the Alternate Base
Rate option can be repaid at any time prior to the termination of the
Revolving Credit Agreement. Borrowings under the competitive bid option can
have any maturity up to 270 days. Borrowings under the Revolving Credit
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Agreement were approved by the Commission in File No. 70-8048. Northeast
Utilities, H.C.A. Rel. No. 25710 (December 16, 1992). Borrowings under the
Revolving Credit Agreement (together with all other short-term borrowings
undertaken by PSNH) are subject to the short-term debt limit approved by the
Commission from time-to-time. PSNH's current short-term debt limit is set at
$125 million. Id.
5. As stated above, the Revolving Credit Agreement currently expires
on May 14, 1994. As PSNH explored various options available to replace the
facility under the Revolving Credit Agreement, it became apparent that the
terms of the Revolving Credit Agreement are as favorable to PSNH as any terms
PSNH could expect to receive for a new revolving credit facility.
Accordingly, PSNH has requested the Banks to extend the term of the present
Revolving Credit Agreement for two more years, to May 14, 1996. This
extension will result in the matching of the expiration date of the Revolving
Credit Agreement with the May 14, 1996 expiration date of PSNH's Term Credit
Agreement dated as of May 1, 1991 with the same group of Banks (the "Term
Credit Agreement"). It will also result in significant transaction cost
savings because PSNH will not need to negotiate and draft entirely new
documents.
6. In order to make conforming changes required by the extension of
the term of the Revolving Credit Agreement and to account for an increase in
the Facility Fee charged by the Banks, PSNH now proposes to make the
following additional amendments to the Revolving Credit Agreement:
-- PSNH will be required to maintain a ratio of operating income to
interest expense on a rolling four quarters basis, measured at the
end of each quarter, through September 30, 1994 of 1.50 to 1 and
from December 31, 1994 through May 14, 1996 of 1.75 to 1 (this
change will bring the above ratios for the two-year extension
period in line with the existing ratios required by the Term Credit
Agreement);
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-- PSNH will be required to maintain a common equity to total
capitalization ratio through June 30, 1994 of 0.21 to 1, from July
1, 1994 through June 30, 1995 of 0.23 to 1, and from July 1, 1995
through May 14, 1996 of 0.25 to 1 (this change will bring the above
ratios for the two-year extension period in line with the existing
ratios required by the Term Credit Agreement); and
-- the Facility Fee charged to PSNH under the Revolving Credit
Agreement may be increased from 25 basis points per annum
($312,500 in the aggregate) to a higher amount that has not yet
been negotiated, but will not exceed a maximum of 37.5 basis points
per annum ($468,750 in the aggregate).
A draft of the proposed amendment to the Revolving Credit Agreement is filed
herewith as Exhibit B.2.
6A. As of December 31, 1993, PSNH's common equity to total
capitalization ratio was 28.3%. As demonstrated in Exhibit J filed herewith,
PSNH expects this ratio to surpass the 30% level by the end of 1994, due to
both growth in its retained earnings and the $23.5 million quarterly sinking
fund payments it is required to make on the term notes it issued in 1991.
7. In consideration of the extension, the Banks will charge PSNH an
extension fee that has not yet been negotiated but will not exceed 15 basis
points of their respective commitments under the Revolving Credit Agreement,
or up to $187,500 in the aggregate.
8. To the extent the transaction described herein would be considered
the issuance of "securities," that transaction is exempt from the competitive
bidding requirement of Rule 50 under Rule 50(a)(2). The Revolving Credit
Agreement has a term of less than 10 years, it is with commercial banks, the
"securities" issued under it will not be resold to the public, and no
finder's fee or other fee for negotiating this transaction will be paid to
anyone except that Northeast Utilities Service Company, an affiliate of PSNH,
will be reimbursed for its costs in arranging this transaction.
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ITEM 2
FEES, COMMISSIONS AND EXPENSES
9. The estimated amounts of fees, commissions and expenses paid or
incurred, or to be paid or incurred, directly or indirectly, by PSNH with
respect to the amendments described herein are set forth in Exhibit H.
10. None of such fees, commissions or expenses will be paid to any
associate company or affiliate of PSNH except for financial and other
services to be performed at cost by Northeast Utilities Service Company, an
affiliated service company, and except that C. Duane Blinn, a member of the
firm of Day, Berry & Howard, counsel to PSNH, is Assistant Secretary of
Connecticut Yankee Atomic Power Company, an affiliate, and the estimate of
legal fees will include payment to be made to that firm for legal services
rendered in connection with the transactions proposed in this Declaration.
ITEM 3
APPLICABLE STATUTORY PROVISIONS
11. The following sections of the Act, and the Rules promulgated by the
Commission pursuant to the Act, are or may be applicable to the transactions
described herein:
Sections of
the Act Transactions to Which Sections Are or May be Applicable
6(a) and 7 Amendment to and extension of term of Revolving Credit
Agreement
Rules Issued
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by SEC Pursuant
to the Act Transactions to Which Rules Are or May be Applicable
Rule 50(a)(2) Amendment to and extension of term of Revolving Credit
Agreement
PSNH requests the Commission's approval, pursuant to this Declaration, of all
transactions connected to the extension of the term of the Revolving Credit
Agreement and the amendments described above, whether under the above
enumerated sections of the Act and the rules thereunder or otherwise.
ITEM 4
REGULATORY APPROVALS
12. In addition to the approval of the Commission, approvals or waivers
are required from the public utility commissions of New Hampshire and
Connecticut. A copy of the application to the New Hampshire Public Utilities
Commission ("NHPUC") is filed herewith as Exhibit D.1, and a copy of the
order of the NHPUC approving the transactions described herein is filed
herewith as Exhibit D.2. A copy of the request for a waiver from the
approval requirement filed with the Connecticut Department of Public Utility
Control ("CDPUC") is filed herewith as Exhibit D.3, and a copy of the order
the CDPUC granting that waiver is filed herewith as Exhibit D.4.
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ITEM 5
PROCEDURE
13. PSNH intends to close the transactions described herein by May 5,
1994. Accordingly, PSNH requests the Commission to issue its order allowing
this Declaration to become effective as soon as practicable and in any event
no later than May 4, 1994.
14. PSNH hereby waives a recommended decision by a hearing officer or
other responsible officer of the Commission and consents that the Office of
Public Utility Regulation within the Division of Investment Management may
assist in the preparation of the Commission's decision and/or order and
hereby requests that the Commission's order become effective forthwith upon
issuance.
ITEM 6
EXHIBITS AND FINANCIAL STATEMENTS
(a) EXHIBITS
(Asterisked (*) items were filed with the original Declaration.)
B.1 Revolving Credit Agreement dated as May 1, 1991 among PSNH, the Banks
named therein, Bankers Trust Company, Chemical Bank and Citibank, N.A.,
as co-agents, and Chemical Bank, as administrative agent. (see Exhibit
4.12 to a Form 8-K report, File No. 1-6392, filed by PSNH on February
10, 1992, and incorporated herein by reference) (copy of Agreement,
without exhibits, filed herewith)
B.2 Amendment to Revolving Credit Agreement
D.1 NHPUC Application
D.2 NHPUC Order
D.3 Request for Waiver from CDPUC
D.4 Waiver from CDPUC
F Opinion of Counsel
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*G Financial Data Schedule
*H Statement of Fees, Commissions and Expenses
*I Proposed Form of Notice
J Calculation of Common Equity Percentage
(b) FINANCIAL STATEMENTS
1. Public Service Company of New Hampshire
*1.1 Balance Sheet, per books and pro forma, as of December 31, 1993
*1.2 Statement of Income, per books and pro forma, for the twelve months
ended December 31, 1993
2. Northeast Utilities and Subsidiaries (consolidated)
*2.1 Balance Sheet, per books and pro forma, as of December 31, 1993
*2.2 Statement of Income, per books and pro forma, for the twelve months
ended December 31, 1993
ITEM 7
INFORMATION AS TO ENVIRONMENTAL EFFECTS
(a) The steps required for the implementation of the transactions
described herein involve amendments to certain agreements entered into by
PSNH. As such, the issuance of an order by the Commission with respect to
this Declaration is not a major federal action significantly affecting the
quality of the human environment.
(b) No.
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SIGNATURES
Pursuant to the requirements of the Public Utility Holding Company Act
of 1935, as amended, the undersigned has duly caused this Amendment to be
signed on its behalf by the undersigned thereunto duly authorized.
Dated: May 2, 1994
Public Service Company of New Hampshire
By: /s/ John B.
Keane John B. Keane
Vice President and Treasurer
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EXHIBIT INDEX
The following exhibits are filed herewith:
Exhibits
B.1 Revolving Credit Agreement dated as May 1, 1991 among PSNH, the Banks
named therein, Bankers Trust Company, Chemical Bank and Citibank, N.A.,
as co-agents, and Chemical Bank, as administrative agent. (copy of
Agreement, without exhibits)
B.2 Amendment to Revolving Credit Agreement
D.1 NHPUC Application
D.2 NHPUC Order
D.3 Request for Waiver from CDPUC
D.4 Waiver from CDPUC
F Opinion of Counsel
J Calculation of Common Equity Percentage
EXHIBIT B.1
CONFORMED COPY
U.S. $200,000,000
REVOLVING CREDIT AGREEMENT
Dated as of May 1, 1991
Among
PUBLIC SERVICE COMPANY OF NEW HAMPSHIRE
as Borrower
THE BANKS NAMED HEREIN
as Banks
BANKERS TRUST COMPANY
CHEMICAL BANK
CITIBANK, N.A.
as Co-Agents
CHEMICAL BANK
as Administrative Agent
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TABLE OF CONTENTS
Section Page
PRELIMINARY STATEMENT
ARTICLE I
DEFINITIONS AND ACCOUNTING TERMS
1.01 Certain Defined Terms . . . . . . . . . . 2
1.02 Computation of Time Periods . . . . . . . 24
1.03 Accounting Terms . . . . . . . . . . . . . 24
1.04 Computations of Outstandings . . . . . . 24
ARTICLE II
COMMITMENTS
2.01 The Commitments . . . . . . . . . . . . . 25
2.02 Fees . . . . . . . . . . . . . . . . . . . 25
2.03 Reduction of the Commitments . . . . . . . 26
ARTICLE III
CONTRACT AND COMPETITIVE ADVANCES
3.01 Contract Advances . . . . . . . . . . . . 26
3.02 Conversion of Contract Advances . . . . . 27
3.03 Other Terms Relating to the Making and
Conversion of Contract Advances . . . . 28
3.04 Competitive Advances . . . . . . . . . . . 28
3.05 Making of Advances . . . . . . . . . . . . 35
3.06 Repayment of Advances . . . . . . . . . . 36
3.07 Interest . . . . . . . . . . . . . . . . . 36
ARTICLE IV
PAYMENTS
4.01 Payments and Computations . . . . . . . . 39
4.02 Prepayments . . . . . . . . . . . . . . . 40
4.03 Yield Protection . . . . . . . . . . . . . 41
4.04 Sharing of Payments, Etc. . . . . . . . . 45
4.05 Taxes . . . . . . . . . . . . . . . . . . 46
ARTICLE V
CONDITIONS PRECEDENT
5.01 Conditions Precedent to Commitment Closing 49
5.02 Conditions Precedent to Funding Date . . . 51
5.03 Conditions Precedent to Each Advance . . . 56
5.04 Reliance on Certificates . . . . . . . . . 57
ARTICLE VI
REPRESENTATIONS AND WARRANTIES
6.01 Representations and Warranties of the Borrower
57
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ARTICLE VII
COVENANTS OF THE BORROWER
7.01 Affirmative Covenants . . . . . . . . . . 61
7.02 Negative Covenants . . . . . . . . . . . . 65
7.03 Reporting Obligations . . . . . . . . . . 72
ARTICLE VIII
DEFAULTS
8.01 Events of Default . . . . . . . . . . . . 77
8.02 Remedies Upon Events of Default . . . . . 80
ARTICLE IX
THE ADMINISTRATIVE AGENT
9.01 Authorization and Action . . . . . . . . . 81
9.02 Administrative Agent's Reliance, Etc. . . 81
9.03 Bankers Trust, Chemical, Citibank
and Affiliates . . . . . . . . . . . . 82
9.04 Lender Credit Decision . . . . . . . . . . 82
9.05 Indemnification . . . . . . . . . . . . . 83
9.06 Successor Administrative Agent . . . . . . 83
ARTICLE X
MISCELLANEOUS
10.01 Amendments, Etc. . . . . . . . . . . . . . 84
10.02 Notices, Etc. . . . . . . . . . . . . . . 85
10.03 No Waiver of Remedies . . . . . . . . . . 86
10.04 Costs, Expenses and Indemnification . . . 86
10.05 Right of Set-Off . . . . . . . . . . . . . 87
10.06 Binding Effect . . . . . . . . . . . . . . 88
10.07 Assignments and Participation . . . . . . 88
10.08 Confidentiality . . . . . . . . . . . . . 92
10.09 Certain Authorizations . . . . . . . . . . 93
10.10 Waiver of Jury Trial . . . . . . . . . . . 93
10.11 Governing Law . . . . . . . . . . . . . . 94
10.12 Relation of the Parties, No Beneficiary . 94
10.13 Execution in Counterparts . . . . . . . . 94
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SCHEDULES
Schedule I - Applicable Lending Offices
Schedule II - Governmental Approvals
Schedule III - Investments
Schedule IV - Pending Actions
Schedule V - Fees
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EXHIBITS
Exhibit 1.01A - Form of Competitive Note
Exhibit 1.01B - Form of Contract Note
Exhibit 1.01C - Form of Collateral Agency Agreement
Exhibit 1.01D - Form of PSNH Mortgage
Exhibit 1.01E - Form of Seabrook Mortgage
Exhibit 3.01A - Form of Notice of Contract Borrowing
Exhibit 3.02A - Form of Notice of Conversion
Exhibit 3.04A-1 - Form of Competitive Bid Request
(Eurodollar Competitive Advance)
Exhibit 3.04A-2 - Form of Confirmation of Competitive Borrowing
(Fixed Rate Competitive Advance)
Exhibit 3.04B - Form of Notice of Competitive Bid Request
(Eurodollar Competitive Advance)
Exhibit 3.04C-1 - Form of Competitive Bid
(Eurodollar Competitive Advance)
Exhibit 3.04C-2 - Form of Confirmation of Competitive Bid
(Fixed Rate Competitive Advance)
Exhibit 3.04D - Form of Competitive Bid Letter
Exhibit 3.04E - Form of Administrative Questionnaire
Exhibit 5.02A - Form of Opinion of Day, Berry & Howard,
counsel to Northeast Utilities Service
Company
Exhibit 5.02B - Form of Opinion of Sulloway Hollis & Soden,
special New Hampshire counsel to
the Borrower
Exhibit 5.02C - Form of Opinion of Pierre O. Caron, Assistant
General Counsel to the Borrower
Exhibit 5.02D - Form of Opinion of Drummond Woodsum
Plimpton & MacMahon, special Maine
counsel to the Borrower
Exhibit 5.02E - Form of Opinion of Zuccaro, Willis & Bent,
special Vermont counsel to the Borrower
Exhibit 5.02F - Form of Opinion of Mintz, Levin, Cohn, Ferris,
Glovsky and Popeo, P.C., special New
Hampshire counsel to the Lenders
Exhibit 5.02G - Form of Opinion of Porter & Travers,
counsel to the Co-Agents
Exhibit 10.07 - Form of Lender Assignment
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CREDIT AGREEMENT
Dated as of May 1, 1991
THIS CREDIT AGREEMENT is made by and among:
(i) Public Service Company of New Hampshire, a debtor-
in-possession under the Bankruptcy Code pursuant
to a proceeding under Chapter 11 of the Bankruptcy
Code which, on the Funding Date (as hereinafter
defined), will be a corporation duly organized and
validly existing under the laws of the State of
New Hampshire (the "Borrower"),
(ii) The financial institutions (the "Banks") listed on
the signature pages hereof and the other Lenders
(as hereinafter defined) from time to time party
hereto, and
(iii) Bankers Trust Company ("Bankers Trust"),
Chemical Bank ("Chemical") and Citibank, N.A.
("Citibank"), as Agents (the "Co-Agents") for
the Lenders hereunder, and
(iv) Chemical, as administrative agent (the
"Administrative Agent") for the Lenders hereunder.
PRELIMINARY STATEMENT
The Borrower commenced a voluntary reorganization case
under Chapter 11 of the Bankruptcy Code on January 28, 1988, in the United
States Bankruptcy Court for the District of New Hampshire (the "Bankruptcy
Court"). The Borrower is being reorganized pursuant to the Third Amended
Joint Plan of Reorganization of the Borrower, dated December 28, 1989 (the
"Plan") as confirmed by order of the Bankruptcy Court on April 20, 1990.
Terms used herein are defined in Section 1.01 below.
In order to finance the reorganization of the Borrower,
the Borrower is entering into the following agreements on the date of the
Commitment Closing (collectively, the "Financing Agreements"):
(i) this Agreement; and
(ii) a $452,000,000 Term Credit Agreement
among the Borrower, the banks named therein,
certain other lenders from time to time parties
thereto, the Co-Agents and the administrative
agent named therein.
In addition to the Financing Agreements, the following
additional sources of capital will be utilized by the Borrower:
(w) the issuance and sale of First Mortgage
Bonds by the Borrower, in an aggregate principal
amount of not less than $858,985,000, on or prior
to the Plan Effective Date; and
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(x) the issuance and sale of not less than
$125,000,000 of Preferred Stock of the Borrower on
or prior to the Plan Effective Date.
In connection with the Borrower's Financing Agreements,
the Borrower has agreed to provide security, in accordance with the terms of
a Collateral Agency Agreement, evidenced by the PSNH Mortgage and the
Seabrook Mortgage.
Additionally, the Borrower has become bound by, and is
entitled to the full rights and benefits of, the Rate Agreement and the
Merger Agreement (subject to any necessary Governmental Approvals) and has
entered into, or will enter into, the other Significant Contracts in
connection with the effectiveness of the Plan and the Merger and Seabrook
Transfer contemplated therein.
Based upon the foregoing and subject to the terms and
conditions set forth in this Agreement, the parties hereto hereby agree as
follows:
ARTICLE I
DEFINITIONS AND ACCOUNTING TERMS
SECTION 01. Certain Defined Terms. As used in this
Agreement, the following terms shall have the following meanings (such
meanings to be applicable to the singular and plural forms of the terms
defined):
"Advance" means a Contract Advance or a
Competitive Advance (each of which shall be a "Class"
of 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.
"Agreement for Capacity Transfer" means the
Agreement for Capacity Transfer between The Connecticut
Light and Power Company and the Borrower which provides
for capacity transfers from the Borrower to The
Connecticut Light and Power Company in the form filed
with the Federal Energy Regulatory Commission on
January 5, 1990.
"Alternate Base Rate" means, for any day, a rate
per annum (rounded upwards, if necessary, to the next
1/8 of 1%) equal to the greater of:
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3
(a) the Prime Rate in effect on such day;
and
(b) the Federal Funds Rate in effect on such
day plus 1/2 of 1% per annum.
For purposes hereof, the term "Prime Rate" shall mean
the rate of interest per annum publicly announced from
time to time by Chemical as its prime rate in effect at
its principal office in New York City; each change in
the Prime Rate shall be effective on the date such
change is publicly announced. If for any reason the
Administrative Agent shall have determined (which
determination shall be conclusive absent manifest
error) that it is unable to ascertain the Federal Funds
Rate for any reason, including the inability or failure
of the Administrative Agent to obtain sufficient
quotations in accordance with the terms thereof, the
Alternate Base Rate shall be determined without regard
to clause (b) of the first sentence of this definition
until the circumstances giving rise to such inability
no longer exist. Any change in the Alternate Base Rate
due to a change in the Prime Rate or the Federal Funds
Rate shall be effective on the effective date of such
change in the Prime Rate or the Federal Funds Rate,
respectively.
"Applicable Contract Margin" means, on any date,
for a Eurodollar Rate Advance, a CD Rate Advance or a
Base Rate Advance, the percentage per annum set forth
below in the column entitled "Eurodollar Rate", "CD
Rate" or "Base Rate", as appropriate:
Eurodollar
Rate CD Rate Base Rate
0.50% 0.875% 0.00%
Each Applicable Contract Margin set forth above shall
be increased (i) by 0.25% per annum, if and so long as
the Borrower shall fail to receive an Investment Grade
Rating and (ii) by 0.375% per annum if and so long as
the Advance to which such Applicable Contract Margin
relates is classified as an HLT.
"Applicable Lending Office" means, with respect to
each Lender:
(i) in the case of any Contract Advance,
(A) such Lender's "Eurodollar Lending Office" in
the case of a Eurodollar Rate Advance, (B) such
Lender's "CD Lending Office" in the case of a CD
Rate Advance, or (C) such Lender's "Domestic
Lending Office" in the case of a Base Rate
Advance, in each case as specified opposite such
Lender's name on Schedule I hereto or in the
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4
Lender Assignment pursuant to which it became a
Lender; or
(ii) in the case of any Competitive Advance,
the office or affiliate of such Lender identified
as the Applicable Lending Office in such Lender's
Competitive Bid tendered pursuant to Section 3.04
hereof; or
(iii) in each case, such other office or
affiliate of such Lender as such Lender may from
time to time specify in writing to the Borrower
and the Administrative Agent.
"Applicable Rate" means:
(i) in the case of each Eurodollar Rate
Advance comprising part of the same 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 Contract
Margin in effect from time to time during such
Interest Period;
(ii) in the case of each CD Rate Advance
comprising part of the same Borrowing, a rate per
annum during each Interest Period equal at all
times to the sum of the CD Rate for such Interest
Period plus the Applicable Contract Margin in
effect from time to time during such Interest
Period;
(iii) in the case of each Base Rate
Advance, a rate per annum equal at all times to
the sum of the Alternate Base Rate in effect from
time to time plus the Applicable Contract Margin
in effect from time to time;
(iv) in the case of each Eurodollar
Competitive Advance, a rate per annum during the
Interest Period therefor, equal at all times to
the sum of the Eurodollar Rate for such Interest
Period plus or minus, as the case may be, the
Competitive Margin in effect during such Interest
Period; and
(v) in the case of each Fixed Rate
Competitive Advance by a Lender, at a rate per
annum during the Interest Period therefor, equal
at all times to the rate specified by such Lender
in its Competitive Bid and accepted by the
Borrower for such Competitive Advance in
accordance with Section 3.04(b)(iv) hereof.
"Available Commitment" means, for each Lender, the
unused portion of such Lender's Commitment (which shall
be equal to the excess, if any, of such Lender's
Commitment over such Lender's Contract Advances then
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5
outstanding), less such Lender's Percentage of the
aggregate amount of Competitive Advances outstanding.
"Available Commitments" shall refer to the aggregate of
the Lenders' Available Commitments hereunder.
"Bankruptcy Court" has the meaning assigned to
that term in the Preliminary Statement.
"Base Rate Advance" means a Contract Advance in
respect of which the Borrower has selected in
accordance with Article II hereof, or this Agreement
provides for, interest to be computed on the basis of
the Alternate Base Rate.
"Borrowing" means a Contract Borrowing or
Competitive Borrowing (each of which shall be a "Class"
of Borrowing).
"Business Day" means a day of the year on which
banks are not required or authorized to close in New
York City and, if the applicable Business Day relates
to any Eurodollar Rate Advances or Eurodollar
Competitive Advances, on which dealings are carried on
in the London interbank market.
"CD Rate" means, for each Interest Period for each
CD Rate Advance comprising part of the same Borrowing,
an interest rate per annum equal to the sum of:
(a) the rate per annum obtained by
multiplying (i) the rate of interest determined by
the Administrative Agent to be the average
(rounded upward to the nearest whole multiple of
1/100 of 1% per annum, if such average is not such
a multiple) of the consensus bid rate determined
by each of the Co-Agents for the bid rates per
annum at 10:00 A.M. (New York City time) (or as
soon thereafter as practicable) on the first day
of such Interest Period, of three New York
certificate of deposit dealers of recognized
standing selected by such Co-Agent for the
purchase at face value of certificates of deposit
issued by such Co-Agent in the amount of
$1,000,000 and with a maturity equal to such
Interest Period, times (ii) the Domestic Reserve
Adjustment in effect from time to time during such
Interest Period, plus
(b) the FDIC Assessment Rate as in
effect from time to time for such Interest Period.
The CD Rate for the Interest Period for each CD Rate
Advance comprising part of the same Borrowing shall be
determined by the Administrative Agent on the basis of
applicable rates furnished to and received by the
Administrative Agent from the Co-Agents on the first
day of such Interest period, subject, however, to the
provisions of Sections 3.07(d) and 4.03(g) hereof.
<PAGE>
6
"CD Rate Advance" means a Contract Advance in
respect of which the Borrower has selected in
accordance with Article III hereof, and this Agreement
provides for, interest to be computed on the basis of
the CD Rate.
"Class" has the meaning assigned to such term
(i) in the definition of "Advance" when used in such
context and (ii) in the definition of "Borrowing" when
used in such context.
"Collateral" means all of the collateral in which
liens, mortgages or security interests are purported to
be granted by any or all of the Security Documents.
"Collateral Agency Agreement" means an agreement
in substantially the form of Exhibit 1.01C hereto.
"Collateral Agent" means Bankers Trust or any
successor thereto as provided in the Collateral Agency
Agreement.
"Commitment" means, for each Lender, the amount
set forth opposite such Lender's name on the signature
pages hereof or, if such Lender has entered into one or
more Lender Assignments, set forth for such Lender in
the Register maintained by the Administrative Agent
pursuant to Section 10.07(c), in each such case as such
amount may be reduced from time to time pursuant to
Section 2.03 hereof. "Commitments" shall refer to the
aggregate of the Lenders' Commitments hereunder.
"Commitment Closing" means the day upon which each
of the conditions precedent enumerated in Section 5.01
hereof shall be fulfilled to the satisfaction of the
Lenders, the Administrative Agent and the Borrower.
All transactions contemplated by the Commitment Closing
shall take place on or prior to June 30, 1991, at the
offices of Porter & Travers, 120 West 45th Street, New
York, New York 10036, at 10:00 A.M. (New York City
time), or such other place and time as the parties
hereto may mutually agree.
"Common Equity" means, at any date, an amount
equal to the sum of the aggregate of the par value of,
or stated capital represented by, the outstanding
shares of common stock of the Borrower and the surplus,
paid-in, earned and other, if any, of the Borrower.
"Competitive Advance" means an advance by a Lender
to the Borrower as part of a Competitive Borrowing and
refers to a Fixed Rate Competitive Advance or a
Eurodollar Competitive Advance (each of which shall be
a "Type" of Competitive Advance).
<PAGE>
7
"Competitive Bid" means an offer by a Lender to
make a Competitive Advance under the competitive
bidding procedure described in Section 3.04(b).
"Competitive Bid Rate" means, as to any
Competitive Bid made by a Lender pursuant to
Section 3.04(b)(iv), (i) in the case of a Eurodollar
Competitive Advance, the Competitive Margin and (ii) in
the case of a Fixed Rate Competitive Advance, the fixed
rate of interest offered by such Lender making such
Competitive Bid.
"Competitive Bid Letter" means a letter in the
form of Exhibit 3.04D hereto.
"Competitive Bid Request" means a request made by
the Borrower pursuant to Section 3.04(b)(i) in the form
of Exhibit 3.04A-1 hereto.
"Competitive Borrowing" means a borrowing
consisting of one or more Competitive Advances of the
same Type and Interest Period made on the same day by
each of the Lenders whose Competitive Bid to make one
or more Competitive Advances as part of such Borrowing
has been accepted by the Borrower under the competitive
bidding procedure described in Section 3.04(b). A
Competitive Borrowing may be referred to herein as
being a "Type" of Competitive Borrowing, corresponding
to the Type of Competitive Advances comprising such
Borrowing.
"Competitive Margin" means, with respect to any
Eurodollar Competitive Advance, the percentage per
annum (expressed in the form of a decimal to no more
than four decimal places) to be added to or subtracted
from the Eurodollar Rate in order to determine the
interest rate applicable to such Advance, as specified
in the Competitive Bid relating to such Advance.
"Competitive Note" means a promissory note of the
Borrower payable to the order of a Lender, in
substantially the form of Exhibit 1.01A hereto,
evidencing the indebtedness of the Borrower to such
Lender from time to time resulting from Competitive
Advances made by such Lender.
"Confidential Information" has the meaning
assigned to that term in Section 10.08.
"Contract Advance" means an advance by a Lender to
the Borrower pursuant to Section 3.01 hereof and refers
to a Eurodollar Rate Advance, a CD Rate Advance or a
Base Rate Advance (each of which shall be a "Type" of
Contract Advance). The Type of Contract Advance may
change from time to time as and when such Advance is
Converted. For purposes of this Agreement, all
Contract Advances of a Lender (or portions thereof)
made of, or Converted into, the same Type and Interest
<PAGE>
8
Period on the same day shall be deemed to be a single
Advance by such Lender until repaid or next Converted.
"Contract Borrowing" means a borrowing consisting
of Contract Advances of the same Type and Interest
Period made on the same day by the Lenders, ratably in
accordance with their respective Commitments. A
Contract Borrowing may be referred to herein as being a
"Type" of Contract Borrowing, corresponding to the Type
of Contract Advances comprising such Borrowing. For
purposes of this Agreement, all Contract Advances made
of, or Converted into, the same Type and Interest
Period on the same day shall be deemed a single
Contract Borrowing hereunder until repaid or next
Converted.
"Contract Note" means a promissory note of the
Borrower payable to the order of a Lender, in
substantially the form of Exhibit 1.01B hereto,
evidencing the aggregate indebtedness of the Borrower
to such Lender resulting from the Contract Advances
made by such Lender.
"Conversion", "Convert" or "Converted" each refers
to a conversion of Contract Advances pursuant to
Section 3.02, including but not limited to any
selection of a longer or shorter Interest Period to be
applicable to such Advances. An Advance of one Class
may not be converted into the other Class.
"Debt" means, for any Person, without duplication,
(i) indebtedness of such Person for borrowed money,
(ii) obligations of such Person evidenced by bonds,
debentures, notes or other similar instruments,
(iii) obligations of such Person to pay the deferred
purchase price of property or services,
(iv) obligations of such Person as lessee under leases
which shall have been or should be, in accordance with
generally accepted accounting principles, recorded as
capital leases (not including the Unit Contract),
(v) obligations (contingent or otherwise) of such
Person under reimbursement or similar agreements with
respect to the issuance of letters of credit, (vi) net
obligations (contingent or otherwise) of such Person
under interest rate swap, "cap", "collar" or other
hedging agreements, (vii) obligations of such person to
pay rent or other amounts under leases entered into in
connection with sale and leaseback transactions
involving assets of such Person being sold in
connection therewith, (viii) 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 (vii),
above, and (ix) liabilities in respect of unfunded
vested benefits under ERISA Plans.
<PAGE>
9
"Domestic Reserve Adjustment" means, during an
Interest Period for CD Rate Advances comprising a
single Borrowing, a fraction (expressed as a decimal),
the numerator of which is the number one and the
denominator of which is the number one minus the
aggregate of the maximum reserve percentages (including
any marginal, special, emergency or supplemental
reserves) in effect from time to time during such
Interest Period, expressed as a decimal, established by
the Board of Governors of the Federal Reserve System
and any other banking authority to which the
Administrative Agent is subject, for nonpersonal time
deposits in U.S. dollars of over $100,000, with
maturities approximately equal to the Interest Period
in effect for such Advances. The Domestic Reserve
Adjustment shall be determined from time to time by the
Administrative Agent, shall be the same for all
Advances comprising the same Borrowing and shall be
adjusted automatically on and as of the effective date
of each change in any reserve requirement.
"ERISA" means the Employee Retirement Income
Security Act of 1974, as amended from time to time.
"ERISA Affiliate" means, with respect to any
Person, any trade or business (whether or not
incorporated) which is a "commonly controlled entity"
of the Borrower within the meaning of the regulations
under Section 414 of the Internal Revenue Code of 1986,
as amended from time to time.
"ERISA Multiemployer Plan" means a "multiemployer
plan" subject to Title IV of ERISA.
"ERISA Plan" means an employee benefit plan (other
than a ERISA Multiemployer Plan) maintained for
employees of the Borrower or any ERISA Affiliate and
covered by Title IV of ERISA.
"ERISA Plan Termination Event" means (i) a
Reportable Event described in Section 4043 of ERISA and
the regulations issued thereunder (other than a
Reportable Event not subject to the provision for
30-day notice to the PBGC under such regulations) with
respect to an ERISA Plan or an ERISA Multiemployer
Plan, or (ii) the withdrawal of the Borrower or any of
its ERISA Affiliates from an ERISA Plan or an ERISA
Multiemployer Plan during a plan year in which it was a
"substantial employer" as defined in Section 4001(a)(2)
of ERISA, or (iii) the filing of a notice of intent to
terminate an ERISA Plan or an ERISA Multiemployer Plan
or the treatment of an ERISA Plan or an ERISA
Multiemployer Plan under Section 4041 of ERISA, or
(iv) the institution of proceedings to terminate an
ERISA Plan or an ERISA Multiemployer Plan by the PBGC,
or (v) any other event or condition which might
constitute grounds under Section 4042 of ERISA for the
<PAGE>
10
termination of, or the appointment of a trustee to
administer, any ERISA Plan or ERISA Multiemployer Plan.
"Eurocurrency Liabilities" has the meaning
assigned to that term in Regulation D of the Board of
Governors of the Federal Reserve System, as in effect
from time to time.
"Eurodollar Competitive Advance" means a
Competitive Advance in respect of which the Borrower
has selected in accordance with Section 3.04 hereof,
and this Agreement provides, interest to be computed on
the basis of the Eurodollar Rate.
"Eurodollar Rate" means, for each Interest Period
for each Eurodollar Rate Advance comprising part of the
same 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 Co-Agents 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 of $1,000,000 and for a
period equal to such Interest Period. The Eurodollar
Rate for the Interest Period for each Eurodollar Rate
Advance comprising part of the same Borrowing shall be
determined by the Administrative Agent on the basis of
applicable rates furnished to and received by the
Administrative Agent from the Co-Agents two Business
Days before the first day of such Interest Period,
subject, however, to the provisions of Sections 3.07(d)
and 4.03(g).
"Eurodollar Rate Advance" means a Contract Advance
in respect of which the Borrower has selected in
accordance with Article III hereof, and this Agreement
provides for, interest to be computed on the basis of
the Eurodollar Rate.
"Eurodollar Reserve Percentage" of any Lender for
each Interest Period for each Eurodollar Rate Advance
means the reserve percentage applicable 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, without benefit of
or credit for proration, exemptions or offsets) for
such Lender with respect to liabilities or assets
consisting of or including Eurocurrency Liabilities
having a term equal to such Interest Period.
<PAGE>
11
"Event of Default" has the meaning specified in
Section 8.01.
"FDIC Assessment Rate" means, during an Interest
Period for CD Rate Advances comprising a single
Borrowing, the annual rate (rounded upwards, if
necessary, to the next 1/100 of 1%) most recently
estimated by the Administrative Agent as the then
current annual assessment rate payable by the
Administrative Agent to the Federal Deposit Insurance
Corporation (or any successor) for insurance by such
Corporation (or such successor) of time deposits made
in U.S. dollars at the Administrative Agent's domestic
offices. The FDIC Assessment Rate shall be the same
for all Advances comprising the same Borrowing and
shall be adjusted automatically on and as of the
effective date of each change in any such rate.
"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 on the next succeeding Business
Day by the Federal Reserve Bank of New York, or, if
such rate is not so published for any day which is a
Business Day, the average of the quotations for such
day on such transactions received by the Administrative
Agent from three Federal funds brokers of recognized
standing selected by it.
"Financing Agreements" has the meaning assigned to
that term in the Preliminary Statement.
"First Mortgage Bond Amount" means $950,000,000,
provided that such dollar amount may be increased if,
concurrently with the issuance of any First Mortgage
Bonds whose aggregate principal amount together with
the aggregate principal amount of all First Mortgage
Bonds outstanding on the day of such issuance exceeds
$950,000,000, the Borrower shall prepay outstanding
Advances in accordance with Section 4.02(d) of the
other Financing Agreement.
"First Mortgage Bonds" means first mortgage bonds
in the maximum aggregate principal amount of up to the
First Mortgage Bond Amount to be issued by the Borrower
and secured, directly or indirectly, collectively or
severally, by one or more first-priority liens on all
or part of the Indenture Assets pursuant to the First
Mortgage Indenture or another indenture in form and
substance satisfactory to the Majority Lenders. For
purposes hereof, all or part of the First Mortgage
Bonds may be issued as collateral for pollution control
revenue bonds or industrial revenue bonds, whether
taxable or tax exempt, issued by the Borrower or by a
governmental authority at the Borrower's request (any
<PAGE>
12
such pollution control revenue bonds or industrial
revenue bonds being included, without duplication as to
the principal amount of First Mortgage Bonds securing
the same, within the definition hereunder of "First
Mortgage Bonds").
"First Mortgage Indenture" means the General and
Refunding Mortgage Indenture, between the Borrower and
New England Merchants National Bank, as trustee and to
which First Fidelity Bank, National Association, New
Jersey, is to be successor trustee, dated as of
August 15, 1978, as amended through the Plan Effective
Date, as the same may thereafter be amended,
supplemented or modified from time to time.
"Fixed Rate Competitive Advance" means a
Competitive Advance in respect of which the Borrower
has selected in accordance with Section 3.04(b)(iv)
hereof, and this Agreement provides, interest to be
computed on the basis of a fixed percentage rate per
annum (expressed in the form of a decimal to no more
than four decimal places) specified by the Lender
making such Advance in its Competitive Bid.
"Form S-1" means the Registration Statement on
Form S-1 as filed by the Borrower with the Securities
and Exchange Commission on June 8, 1990 and all
amendments and supplements thereto.
"Funding Date" means the day upon which each of
the conditions precedent enumerated in Section 5.02
hereof shall be fulfilled to the satisfaction of the
Lenders, the Administrative Agent and the Borrower.
All transactions contemplated to occur on the Funding
Date shall occur contemporaneously with the Plan
Effective Date on or prior to June 30, 1991 at the
offices of Porter & Travers, 120 West 45th Street, New
York, New York 10036, at 10:00 A.M. (New York City
time), or at such other place and time as the parties
hereto may mutually agree.
"Governmental Approval" means any authorization,
consent, approval, license, permit, certificate,
exemption of, or filing or registration with, any
governmental authority or other legal or regulatory
body (including, without limitation, the Bankruptcy
Court), required in connection with either (i) the
execution, delivery or performance of the Rate
Agreement, the Merger Agreement, any Loan Document or
any Significant Contract, (ii) the grant and perfection
of any security interest, lien or mortgage contemplated
by the Security Documents, or (iii) the nature of the
Borrower's business as conducted or the nature of the
property owned or leased by it. For purposes of this
Agreement, Chapter 362-C of the Revised Statutes
Annotated of New Hampshire, as in effect on the date
hereof, shall be deemed to be a Governmental Approval.
<PAGE>
13
"Hazardous Substance" means any waste, substance
or material identified as hazardous, dangerous or toxic
by any office, agency, department, commission, board,
bureau or instrumentality of the United States of
America or of the State or locality in which the same
is located having or exercising jurisdiction over such
waste, substance or material.
"HLT" means, with respect to any or all of the
Advances outstanding hereunder from time to time, a
classification by any Co-Agent or the Majority Lenders,
in good faith, or by the Comptroller of the Currency,
the Board of Governors of the Federal Reserve System,
the Federal Deposit Insurance Corporation or any other
regulatory authority of the transactions evidenced by
the Loan Documents as a "highly leveraged transaction"
or an "HLT" as defined in Banking Circular BC-242,
issued by the Comptroller of the Currency on
October 30, 1989, as modified, amended or supplemented
from time to time.
"Indemnified Person" has the meaning assigned to
that term in Section 10.04(b) hereof.
"Indenture Assets" means fixed assets of the
Borrower (including related Governmental Approvals and
regulatory assets, but excluding the Seabrook
Interests) which from time to time are subject to the
first-priority lien under the First Mortgage Indenture.
"Information Memorandum" means the Confidential
Information Memorandum, dated January 1991, regarding
the Borrower and NU, as distributed to the
Administrative Agent, the Co-Agents and the Lenders,
including, without limitation, Amendments Nos. 1, 2, 3,
4 and 5 to Form S-1, dated September 27, 1990,
February 8, 1991, April 26, 1991, May 7, 1991 and May
9, 1991, respectively, the reports of the Borrower
filed with the Securities and Exchange Commission on
Form 8-K, dated January 8, 1991 and May 1, 1991, each
of Form 10-Q for the quarter ended September 30, 1990
and March 31, 1991 and the Form 10-K for each of the
fiscal year ended December 31, 1989 and the Third
Amended Disclosure Statement of NUSCO dated
December 28, 1989, as filed with the Bankruptcy Court.
"Interest Expense" means, for any period, the
aggregate amount of any interest on Debt (including
long-term and short-term Debt).
"Interest Period" has the meaning assigned to that
term in Section 3.07(a) hereof.
"Investment Grade Rating" means a rating of Baa3
or better by Moody's Investor Service, Inc. and a
rating of BBB- or better by Standard & Poor's
Corporation with respect to all First Mortgage Bonds
rated by such agencies or, if no rated First Mortgage
<PAGE>
14
Bonds are outstanding, all other senior long-term debt
of the Borrower not entitled to the benefits of a
letter of credit or other credit enhancement facility.
"Joint Ownership Agreement" means the Agreement
for Joint Ownership, Construction and Operation of New
Hampshire Nuclear Units, among the Borrower and the
other parties named therein, dated as of May 1, 1973,
as amended from time to time.
"Lender Assignment" means an assignment and
agreement entered into by a Lender and an assignee, and
accepted by the Administrative Agent, in substantially
the form of Exhibit 10.07 hereto.
"Lenders" means the financial institutions listed
on the signature pages hereof, and each assignee that
shall become a party hereto pursuant to Section 10.07.
"Lien" has the meaning assigned to that term in
Section 7.02(a) hereof.
"Loan Documents" means the Financing Agreements,
the Notes and the Security Documents.
"Major Electric Generating Plants" means the
following nuclear, combustion turbine and coal, oil or
diesel-fired generating stations of the Borrower:
Seabrook; the Merrimack generating station located in
Bow, New Hampshire; the Newington generating station
located in Newington, New Hampshire; the Schiller
generating station located in Portsmouth, New
Hampshire; the White Lake combustion turbine located in
Tamworth, New Hampshire; the Millstone Unit No. 3
generating station located in Waterford, Connecticut,
and the Wyman Unit No. 4 generating station located in
Yarmouth, Maine.
"Majority Lenders" means on any date of
determination, Lenders who, collectively, on such date
(i) hold at least 66-2/3% of the then aggregate unpaid
principal amount of the Advances owing to the Lenders
and (ii) have Percentages in the aggregate of at least
66-2/3%. Determination of those Lenders satisfying the
criteria specified above for action by the Majority
Lenders shall be made by the Administrative Agent and
shall be conclusive and binding on all parties absent
manifest error.
"Management Services Agreement" means the
Management Services Agreement between NUSCO and the
Borrower in the form of Exhibit A to the Merger
Agreement, as supplemented by Supplement No. 1 dated as
of April 30, 1990.
"Merger" means (i) the merger of NU Acquisition
Corp., a wholly-owned subsidiary of NU, with and into
the Borrower, pursuant to and in accordance with the
<PAGE>
15
terms of the Merger Agreement and (ii) the concurrent
transfer by the Borrower, as so merged, to NAEC of the
Seabrook Interests (the "Seabrook Transfer") in
accordance with the Plan, the Rate Agreement and the
capital structure of the Borrower set forth in the
Merger Pro-formas delivered pursuant to
Section 5.01(a)(v) hereof.
"Merger Agreement" means the Merger Agreement in
the form of Exhibit A to the Plan, without giving
effect to any amendment, modification or supplement
thereto except as may be permitted by the terms hereof
or as may otherwise be consented to by the Majority
Lenders.
"Merger Effective Date" means the date on which
the Merger is consummated.
"Merger Pro-Formas" has the meaning assigned to
that term in Section 5.01(a)(v).
"NAEC" means North Atlantic Energy Corporation, a
corporation to be formed and wholly-owned by NU for the
sole purpose of acquiring the Seabrook Interests, which
shall be acquired by NAEC from the Borrower on the
Merger Effective Date.
"Note" means a Contract Note or a Competitive
Note.
"Notice of Contract Borrowing" has the meaning
assigned to that term in Section 3.01 hereof.
"NU" means Northeast Utilities, an unincorporated
voluntary business association organized under the laws
of the Commonwealth of Massachusetts.
"NUSCO" means Northeast Utilities Service Company,
a Connecticut corporation and a wholly-owned subsidiary
of NU.
"Operating Income" means, for any period, the
Borrower's operating income for such period, adjusted
as follows:
(i) increased by the amount of income taxes
(including New Hampshire Business Profits Tax and
other comparable taxes) paid by the Borrower
during such period, if and to the extent deducted
in the computation of the Borrower's operating
income for such period; and
(ii) increased by the amount of any
depreciation deducted by the Borrower during such
period; and
<PAGE>
16
(iii) increased by the amount of any
amortization of acquisition adjustment deducted by
the Borrower during such period; and
(iv) decreased by the amount of any capital
expenditures paid by the Borrower during such
period.
"PBGC" means the Pension Benefit Guaranty
Corporation (or any successor entity) established under
ERISA.
"Percentage" means, in respect of 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 day, and multiplying
the quotient so obtained by 100%.
"Permitted Investments" means each and any of the
following so long as (A) with respect to Permitted
Investments held or maintained by the Collateral Agent
pursuant to the terms of any Loan Document, no such
Permitted Investment shall have a final maturity later
than one month from the date of investment therein and
(B) with respect to all other Permitted Investments, no
such Permitted Investment shall have a final maturity
later than 12 months from the date of investment
therein and all such Permitted Investments,
collectively, shall have a dollar-weighted average
maturity no later than six months from any date of
determination:
(i) direct obligations of the United States
of America, or obligations guaranteed as to
principal and interest by the United States of
America;
(ii) certificates of deposit, eurodollar
certificates of deposit or bankers' acceptances
issued, or time deposits held, or investment
contracts guaranteed, by (A) any Bank; or (B) any
other commercial bank, trust company, savings and
loan association or savings bank organized under
the laws of the United States of America, or any
State thereof, or of any other country which is a
member of the Organization for Economic
Cooperation and Development (or a political
subdivision of any such country) having
outstanding unsecured indebtedness that is rated
(on the date of acquisition thereof) AA- or better
by Standard & Poor's Corporation or Aa3 or better
by Moody's Investors Service, Inc. (or an
equivalent rating by another nationally recognized
credit rating agency of similar standing if
neither of such corporations is then in the
business of rating unsecured bank indebtedness);
<PAGE>
17
(iii) obligations with any Co-Agent or
any other bank or trust company described in
clause (ii), above, in respect of the repurchase
of obligations of the type described in
clause (i), above, provided that such repurchase
obligations shall be fully secured by obligations
of the type described in said clause (i) and the
possession of such obligations shall be
transferred to, and segregated from other
obligations owned by, such Co-Agent or such other
bank or trust company;
(iv) commercial paper rated (on the date of
acquisition thereof) A-1 or P-1 or better by
Standard & Poor's Corporation or Moody's Investors
Services, Inc., respectively (or an equivalent
rating by another nationally recognized credit
rating agency of similar standing if neither of
such corporations is then in the business of
rating commercial paper); and
(v) after the Merger Effective Date,
obligations of NU or any Affiliate of NU held or
maintained in accordance with NUSCO intercompany
lending arrangements.
"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" has the meaning assigned to that term in
the Preliminary Statement.
"Plan Effective Date" means the effective date of
the Plan, pursuant to and in accordance with the terms
thereof.
"Plan Pro-Formas" has the meaning assigned to that
term in Section 5.01(a)(v).
"Preferred Stock" means 5,000,000 shares of
Series A Preferred Stock of the Borrower (par value
$25) as described in the Form S-1.
"Preliminary Official Statements" means those four
disclosure documents of The Industrial Development
Authority of the State of New Hampshire (the
"Authority"), each entitled "Preliminary Official
Statement dated April 26, 1991", related to the
Pollution Control Revenue Bonds of the Authority
(Public Service Company of New Hampshire Project - 1991
Tax-Exempt Series A, B and C and Public Service Company
of New Hampshire Project - 1991 Taxable Series D and
E).
<PAGE>
18
"PSNH Mortgage" means a mortgage by the Borrower
in favor of the Collateral Agent, substantially in the
form of Exhibit 1.01D hereto.
"Rate Agreement" means the Agreement dated as of
November 22, 1989, as amended by the First Amendatory
Agreement dated as of December 5, 1989, and the Second
Amendatory Agreement dated as of December 12, 1989,
among NUSCO, the Governor and the Attorney General of
the State of New Hampshire and adopted by the Borrower
as of July 10, 1990 (without giving effect to any
deemed modification effected pursuant to Section 2(c)
thereof except and to the extent the Majority Lenders
shall have consented thereto in writing, and excluding
the Unit Contract appended as Exhibit A thereto
subsequent to the effectiveness of such contract).
"Recipient" has the meaning assigned to that term
in Section 10.08 hereof.
"Register" has the meaning specified in
Section 10.07(c).
"Restricted Payment" has the meaning assigned to
that term in Section 7.02(f) hereof.
"Seabrook" means the nuclear-fueled, steam-
electric generating plant at a site located in
Seabrook, New Hampshire, and the related real property
interests, and other fixed assets as they are more
fully described in the Seabrook Mortgage.
"Seabrook Indenture Assets" means that portion of
the Seabrook Interests subject to the Seabrook
Mortgage.
"Seabrook Interests" means all of the Borrower's
right, title and interest in and to the fixed assets of
Seabrook and nuclear fuel relating to Seabrook and
Governmental Approvals relating thereto, including the
undeveloped land adjacent to Seabrook wholly-owned by
the Borrower and described as the "Adjacent Property"
in Schedule D to the PSNH Mortgage.
"Seabrook Mortgage" means a mortgage by the
Borrower in favor of the Collateral Agent,
substantially in the form of Exhibit 1.01E hereto,
covering the Seabrook Indenture Assets.
"Seabrook Transfer" has the meaning assigned to
that term in clause (ii) of the definition of "Merger"
herein.
"Secured Party" has the meaning assigned to that
term in the Collateral Agency Agreement.
"Security Documents" means the PSNH Mortgage, the
Seabrook Mortgage and the Collateral Agency Agreement.
<PAGE>
19
"Series D Reimbursement Agreement" means the
Series D Letter of Credit and Reimbursement Agreement,
dated as of May 1, 1991, among the Borrower, Citibank,
N.A. and the Participating Banks named therein relating
to the Industrial Development Authority of the State of
New Hampshire Pollution Control Revenue Bonds (Public
Service Company of New Hampshire Project - 1991 Taxable
Series D), as the same may from time to time be
amended, modified or supplemented.
"Series E Reimbursement Agreement" means the
Series E Letter of Credit and Reimbursement Agreement,
dated as of May 1, 1991, among the Borrower, Citibank,
N.A. and the Participating Banks named therein relating
to the Industrial Development Authority of the State of
New Hampshire Pollution Control Revenue Bonds (Public
Service Company of New Hampshire Project - 1991 Taxable
Series E), as the same may from time to time be
amended, modified or supplemented.
"Sharing Agreement" means the Sharing Agreement
among The Connecticut Light and Power Company, NUSCO,
the Borrower and certain other parties thereto in the
form filed with the Federal Energy Regulatory
Commission on January 5, 1990, to be entered into on or
prior to the Merger Effective Date.
"Significant Contracts" means the following
contracts, in each case as the same may be amended,
modified or supplemented from time to time in
accordance with this Agreement:
(i) the Agreement for Capacity Transfer; and
(ii) the Management Services Agreement.
The following agreements shall be "Significant
Contracts" when entered into by the Borrower as
provided below:
(x) the Sharing Agreement;
(y) the Tax Allocation Agreement; and
(z) the Unit Contract.
"Tax Allocation Agreement" means the Tax
Allocation Agreement dated as of January 1, 1990 among
NU and the members of the consolidated group of which
NU is the common parent, to which the Borrower will be
added as a party on or prior to the Merger Effective
Date.
"Termination Date" means the earlier to occur of
(i) May 14, 1994, (ii) June 30, 1991, if the Funding
Date shall not have occurred on or prior to such date,
(iii) the date of termination or reduction in whole of
<PAGE>
20
the Commitments pursuant to Section 2.03 or 8.02 or
(iv) the date of acceleration of all amounts payable
hereunder and under the Notes pursuant to Section 8.02.
"Total Capitalization" means, as of any day, the
aggregate of all amounts that would, in accordance with
generally accepted accounting principles applied on a
basis consistent with the standards referred to in
Section 1.03 hereof, appear on the balance sheet of the
Borrower as of such day as the sum of (i) the principal
amount of all long-term Debt of the Borrower on such
day, (ii) the par value of, or stated capital
represented by, the outstanding shares of all classes
of common and preferred shares of the Borrower on such
day, (iii) the surplus of the Borrower, paid-in, earned
and other, if any, on such day and (iv) the unpaid
principal amount of all short-term Debt of the Borrower
on such day.
"Type", has the meaning assigned to such term
(i) in the definition of "Contract Advance" when used
in the such context and (ii) in the definition of
"Contract Borrowing" when used in such context.
"Unit Contract" means the Unit Contract between
the Borrower and NAEC, to be entered into on or prior
to the Merger Effective Date, in the form of Exhibit A
to the Rate Agreement.
"Unmatured Default" means the occurrence and
continuance of an event which, with the giving of
notice or lapse of time or both, would constitute an
Event of Default.
SECTION 1.02. Computation of Time Periods. 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".
SECTION 1.03. Accounting Terms. All accounting terms
not specifically defined herein shall be construed in accordance with
generally accepted accounting principles applied on a basis consistent with
the application employed in the preparation of the financial projections and
pro-formas referred to in subsections 5.01(a)(iv) and (v) hereof.
SECTION 1.04. 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 sum of the
aggregate principal amount of all Advances outstanding on such date in each
case after giving effect to all Advances to be made on such date and the
application of the proceeds thereof.
<PAGE>
21
ARTICLE II
COMMITMENTS
SECTION 01. The Commitments. (a) Each Lender
severally agrees, on the terms and conditions hereinafter set forth, to make
Advances to the Borrower from time to time on any Business Day during the
period from the Funding Date until the Termination Date in an aggregate
outstanding amount not to exceed on any day such Lender's Available
Commitment (after giving effect to all Advances to be made on such day and
the application of the proceeds thereof). Within the limits of each Lender's
Available Commitment, the Borrower may request Advances hereunder, repay or
prepay Advances and utilize the resulting increase in the Available
Commitments for further Advances in accordance with the terms hereof.
(b) In no event shall the Borrower be entitled to
request or receive any Advance that would cause the total principal amount
outstanding hereunder to exceed the Commitments.
(c) In addition to each Lender's Commitment under
subsection (a) above, but subject nevertheless to the provisions of
subsection (b) above, the Borrower may request Competitive Advances to be
made at the discretion of each Lender, in accordance with Section 3.04
hereof.
SECTION 02. Fees. (a) The Borrower agrees to pay to
the Administrative Agent for the account of each Lender a facility fee on the
amount of such Lender's Commitment at the rate of 0.25% per annum, from the
Funding Date, in the case of each Bank, and from the effective date specified
in the Lender Assignment pursuant to which it became a Lender, in the case of
each other Lender, until the Termination Date, payable quarterly on the
fourteenth day of each February, May, August and November, commencing the
first such date following the Funding Date, with final payment on the
Termination Date.
(b) The Borrower agrees to pay to the Administrative
Agent for the account of each Lender the fees specified in Schedule V hereto,
such fees to be payable on the Funding Date.
(c) The Borrower agrees to pay to the Co-Agents and
the Administrative Agent, for their respective accounts, fees in such amounts
and payable at such times, as shall be agreed among themselves from time to
time in writing.
SECTION 03. Reduction of the Commitments. (a) The
Borrower may not reduce the Commitments hereunder in part, prior to the
Funding Date, without the prior written consent of the Majority Lenders.
After the Funding Date, the Borrower may, upon at least five Business Days'
notice to the Administrative Agent, terminate in whole or reduce ratably in
part the respective Available Commitments of the Lenders; provided (i) that
any such partial reduction shall be in the aggregate amount of $15,000,000 or
an integral multiple of $1,000,000 in excess thereof and (ii) that in no
event shall the Commitments be reduced hereunder to an amount less than the
principal amount outstanding hereunder.
(b) The Borrower may not reduce the lending
commitments under the other Financing Agreement in whole or in part prior to
the Funding Date without the prior written consent of the Majority Lenders;
<PAGE>
22
provided, however, the Borrower may terminate such lending commitments in
whole at any time if concurrently with any such termination the Borrower
terminates the Commitments hereunder in whole. For purposes of this
subsection (b), the Lenders will not unreasonably withhold their consent to
any such reduction hereunder or thereunder if they are satisfied, in their
sole judgment, that after giving effect thereto (i) sufficient funds will be
available to the Borrower to consummate the Plan and (ii) the Borrower will
have sufficient funds to likely remain in compliance with the covenants set
forth in Section 7.01(j) hereof.
(c) On the Merger Effective Date, the Commitments
shall be reduced ratably to the aggregate amount of $125,000,000.
(d) If the Funding Date does not occur on or prior to
June 30, 1991, the Commitment of each Lender shall automatically terminate.
ARTICLE III
CONTRACT AND COMPETITIVE ADVANCES
SECTION 01. Contract Advances. Each Contract
Borrowing shall consist of Contract Advances of the same Type and Interest
Period made on the same Business Day by the Lenders ratably according to
their respective Commitments. The Borrower may request that more than one
Borrowing be made on the same day. Each Contract Borrowing shall be made on
notice, given not later than 11:00 A.M. (New York City time) (i) in the case
of Eurodollar Rate Advances, on the third Business Day prior to the date of
the proposed Borrowing, (ii) in the case of CD Rate Advances, on the second
Business Day prior to the date of the proposed Borrowing, and (iii) in the
case of Base Rate Advances, on the day of the proposed Borrowing, by the
Borrower to the Administrative Agent, who shall give to each Lender prompt
notice thereof on the same day such notice is received. Each such notice of
a Contract Borrowing (a "Notice of Contract Borrowing") shall be in
substantially the form of Exhibit 3.01A hereto, specifying therein the
requested (i) date of such Borrowing, (ii) Type of Advances comprising such
Borrowing and (iii) Interest Period for each such Advance. Each proposed
Borrowing shall be subject to the provisions of Sections 3.03, 4.03 and
Article V hereof.
SECTION 02. Conversion of Contract Advances. So long
as no Event of Default shall have occurred and be continuing, the Borrower
may from time to time elect to Convert one or more Contract Advances of any
Type to one or more Contract Advances of the same or any other Type on the
following terms and subject to the following conditions:
(a) Each such Conversion shall be made as to all
Advances comprising a single Contract Borrowing, on notice given not later
than 10:00 A.M. (New York City time) on the third Business Day prior to the
date of the proposed Conversion by the Borrower to the Administrative Agent,
who shall give to each Lender prompt notice thereof. Each such notice of
Conversion (a "Notice of Conversion") shall be in substantially the form of
Exhibit 3.02A hereto, specifying therein the requested (i) date of such
Conversion, (ii) Type of, and Interest Period applicable to, the Advances
proposed to be Converted, (iii) except in the case of a Conversion described
in subsection (c) below, Type of Advances to which such Advances are proposed
to be Converted, (iv) except in the case of a Conversion to Base Rate
Advances, initial Interest Period to be applicable to the Advances resulting
<PAGE>
23
from such Conversion and (v) aggregate amount of Advances proposed to be
Converted. No Conversion may be requested by the Borrower hereunder unless
made in compliance with Section 3.03 hereof.
(b) The Borrower may not select an Interest Period of
greater than one month (in the case of Conversions to Eurodollar Rate
Advances) or 30 days (in the case of Conversions to CD Rate Advances) during
the continuance of an Unmatured Default.
(c) If no Notice of Conversion in respect of an
Advance is received by the Administrative Agent as provided in subsection (a)
above with respect to any Eurodollar Rate Advance or CD Rate Advance, the
Administrative Agent shall treat such absence of notice as a deemed Notice of
Conversion providing for each such Advance to be Converted into a Base Rate
Advance on the last day of the Interest Period then in effect for such
Advance.
SECTION 03. Other Terms Relating to the Making and
Conversion of Contract Advances. (a) Notwithstanding anything in
Section 3.01 or 3.02 above to the contrary:
(i) at no time shall more than ten different
Contract Borrowings be outstanding hereunder;
(ii) each Contract Borrowing hereunder shall
be in an aggregate principal amount of not less
than $10,000,000 or an integral multiple of
$1,000,000 in excess thereof, or such lesser
amount as shall be equal to the total amount of
the Available Commitments for Contract Advances on
such date, after giving effect to all other
Contract Borrowings and Conversions to be made on
such date; and
(iii) each Contract Borrowing hereunder
which is to be comprised of Eurodollar Rate
Advances or CD Rate Advances shall be in an
aggregate principal amount of not less than
$10,000,000.
(b) Each Notice of Borrowing and Notice of Conversion
shall be irrevocable and binding on the Borrower.
SECTION 04. (a) Competitive Advances.
(i) Each Competitive Borrowing shall consist
of Competitive Advances of the same Type and
Interest Period made by the Lenders in accordance
with Section 3.04 hereof and shall be in a minimum
aggregate principal amount of $5,000,000 or an
integral multiple of $1,000,000 in excess thereof,
except as otherwise provided pursuant to
Section 3.04(b)(iv) hereof. Competitive Advances
shall be made in the amounts accepted by the
Borrower in accordance with Section 3.04(b)(iv).
Each Competitive Advance, regardless of which
Lender makes such Advance, will reduce the
Available Commitments of all Lenders pro rata as
<PAGE>
24
provided in the definition of "Available
Commitments" in Section 1.01 hereof. Promptly
after each Competitive Borrowing, the
Administrative Agent will notify each Lender of
the amount of the Competitive Borrowing, the
amount by which such Lender's Available Commitment
has been reduced, the date of the Competitive
Borrowing and the Interest Period with respect
thereto.
(ii) The Borrower shall not request any
Competitive Advance with an Interest Period ending
after the Merger Effective Date if the aggregate
principal amount of all outstanding Competitive
Advances with Interest Periods ending after the
Merger Effective Date (after giving effect to such
requested Competitive Advance) is greater than
$125,000,000.
(b) Competitive Bid Procedures.
(i) In order to request Competitive Bids,
(A) in the case of any request for Eurodollar
Competitive Advances, the Borrower shall hand
deliver, telex or telecopy to the Administrative
Agent a duly completed Competitive Bid Request to
be received by the Administrative Agent not later
than 10:00 A.M. (New York City time), four
Business Days prior to a proposed Competitive
Borrowing to consist of Eurodollar Competitive
Advances and (B) in the case of any request for
Fixed Rate Competitive Advances, the Borrower
shall give telephonic notice of a proposed
Competitive Borrowing to consist of Fixed Rate
Competitive Advances to the Administrative agent
not later than 9:15 A.M. (New York City time) on
the day of a proposed Competitive Borrowing (with
written confirmation of the information given by
telephone substantially in the form of
Exhibit 3.04A-2 delivered by hand, telecopy or
telex by the Borrower to the Administrative Agent
no later than 5:00 P.M. (New York City time) on
the day of such Competitive Borrowing.) No
Contract Advances shall be requested in or made
pursuant to a Competitive Bid Request. A
Competitive Bid Request which requests Eurodollar
Competitive Advances that does not conform
substantially to the form of Exhibit 3.04A-1 may
be rejected in the Administrative Agent's sole
discretion, and the Administrative Agent shall
promptly notify the Borrower of such rejection by
telex or telecopier. Such request shall refer to
this Agreement and specify (1) the Lenders
selected by the Borrower to make a Competitive Bid
(which shall be no more than six Lenders), (2) the
date of such Competitive Borrowing (which shall be
a Business Day) and the aggregate principal amount
thereof (which shall not be less than $5,000,000
<PAGE>
25
or an integral multiple of $1,000,000 in excess
thereof), (3) the Interest Period with respect
thereto and (4) whether the Borrowing then being
requested is to consist of Eurodollar Competitive
Advances or Fixed Rate Competitive Advances.
Promptly after its receipt of a Competitive Bid
Request that is not rejected as aforesaid, the
Administrative Agent shall (A) in the case of a
proposed Competitive Borrowing to consist of
Eurodollar Competitive Advances, invite by telex
or telecopier (in the form of Exhibit 3.04B
hereto) the selected Lenders to bid to make
Competitive Advances pursuant to the Competitive
Bid Request and (B) in the case of a proposed
Competitive Borrowing to consist of Fixed Rate
Competitive Advances, not later than 9:30 A.M.
(New York City time) on the day of such
Competitive Bid Request, invite the selected
Lenders by telephone to make Competitive Advances
pursuant to the Competitive Bid Request, in
accordance with the terms and conditions of this
Agreement.
(ii) Each selected Lender may, in its sole
discretion, make one or more Competitive Bids to
the Borrower which shall be responsive to the
Competitive Bid Request. Each Competitive Bid by
such Lender must be received by the Administrative
Agent (A) in the case of a proposed Competitive
Borrowing to consist of Eurodollar Competitive
Advances, by telex or telecopier (in the form of
Exhibit 3.04C-1 hereto) not later than 9:30 A.M.
(New York City time), three Business Days prior to
a proposed Competitive Borrowing and (B) in the
case of a proposed Competitive Borrowing to
consist of Fixed Rate Competitive Advances not
later than 9:45 A.M. (New York City time) on the
day of a proposed Competitive Borrowing
(subsequently confirmed in writing, not later than
11:00 A.M. (New York City time) substantially in
the form of Exhibit 3.04C-2 hereto). Multiple
bids will be accepted by the Administrative Agent.
Competitive Bids, with respect to Eurodollar
Competitive Advances, that do not conform
substantially to the format of Exhibit 3.04C-1 may
be rejected by the Administrative Agent after
conferring with, and upon the instruction of, the
Borrower, and the Administrative Agent shall
notify the Lender making such non-conforming bid
of such rejection as soon as practicable. Each
bid (a "Competitive Bid") shall refer to this
Agreement and specify (A) the principal amount
(which shall be a minimum principal amount of
$5,000,000 and in an integral multiple of
$1,000,000 and which may be up to the aggregate
amount of the proposed Competitive Borrowing
regardless of the Commitment of the Lender) of the
Competitive Advance that the Lender is willing to
<PAGE>
26
make to the Borrower and (B) the Competitive Bid
Rate or Rates at which the Lender is prepared to
make the Competitive Advances. If any selected
Lender shall elect not to make a Competitive Bid,
such Lender shall so notify the Administrative
Agent (A) in the case of a proposed Competitive
Borrowing to consist of Eurodollar Competitive
Advances, by telex or telecopier, not later than
9:30 A.M. (New York City time), three Business
Days prior to a proposed Competitive Borrowing,
and (B) in the case of a proposed Competitive
Borrowing to consist of Fixed Rate Competitive
Advances, by telephone, telex or telecopier not
later than 9:45 A.M. (New York City time) on the
day of a proposed Competitive Borrowing; provided,
however, that failure by any Lender to give such
notice shall not cause such Lender to be obligated
to make any Competitive Advance. A Competitive
Bid submitted by a Lender pursuant to this
subsection (ii) shall be irrevocable.
(iii) The Administrative Agent shall
(A) in the case of a proposed Borrowing to consist
of Eurodollar Competitive Advances, promptly
notify the Borrower by telex or telecopier and
(B) in the case of a proposed Borrowing to consist
of Fixed Rate Competitive Advances, notify the
Borrower by telephone not later than 10:00 A.M.
(New York City time) on the day of such proposed
Competitive Borrowing of the Competitive Bids
made, the Competitive Bid Rate, the principal
amount of each Competitive Bid and the identity of
the Lender that made each Competitive Bid.
(iv) The Borrower may, in its sole and
absolute discretion, subject only to the
provisions of this subsection (iv), accept or
reject any Competitive Bid. The Borrower shall
notify the Administrative Agent by telephone
whether and to what extent it has decided to
accept or reject any or all of the Competitive
Bids (specifying each Lender selected by it to
make Competitive Advances, the principal amount of
such Advances and the Competitive Bid Rate) (A) in
the case of a Borrowing to consist of Eurodollar
Competitive Advances, by not later than 10:15 A.M.
(New York City time) three Business Days before a
proposed Competitive Borrowing (promptly confirmed
by a Competitive Bid Letter, hand delivered,
telexed or telecopied by the Borrower to the
Administrative Agent), and (B) in the case of a
Borrowing to consist of Fixed Rate Competitive
Advances, not later than 10:15 A.M. (New York City
time) on the day of a proposed Competitive
Borrowing (confirmed in writing substantially in
the form of Exhibit 3.04A-2, hand delivered,
telexed or telecopied to the Administrative Agent
not later than 5:00 P.M. (New York City time) on
<PAGE>
27
the day of the proposed Competitive Borrowing);
provided, however, that (1) the failure by the
Borrower to give such notice shall be deemed to be
a rejection of all the bids referred to in
subsection (iii) above, (2) the Borrower shall not
accept a bid made at a particular Competitive Bid
Rate if the Borrower has decided to reject a bid
made at a lower Competitive Bid Rate, (3) the
aggregate amount of the Competitive Bids accepted
by the Borrower shall not exceed the principal
amount specified in the Competitive Bid Request,
(4) if the Borrower shall determine to accept
Competitive Bids made at a particular Competitive
Bid Rate but the aggregate amount of all
Competitive Bids made at such Competitive Bid
Rate, when added to the aggregate amount of all
Competitive Bids at lower Competitive Bid Rates,
would cause the total amount of Competitive Bids
to be accepted by the Borrower to exceed the
principal amount specified in the Competitive Bid
Request, then the Borrower shall accept all such
Competitive Bids at such Competitive Bid Rate in
an aggregate amount reduced to eliminate such
excess, which acceptance, in the case of multiple
Competitive Bids at such Competitive Bid Rate,
shall be made ratably in accordance with the
amount of each such Competitive Bid (subject to
clause (5) below), and (5) no Competitive Bid
shall be accepted for a Competitive Advance unless
such Competitive Advance is in a minimum principal
amount of $5,000,000 and an integral multiple of
$1,000,000 in excess thereof; provided further,
however, that if a Competitive Advance must be in
an amount of less than $5,000,000 because of the
provisions of (4) above, such Competitive Advance
may be for a minimum of $1,000,000 or any integral
multiple thereof, and in calculating the pro rata
allocation of acceptances of portions of multiple
bids at a particular Competitive Bid Rate pursuant
to (4) above, the amounts shall be rounded to
integral multiples of $1,000,000 in a manner which
shall be in the discretion of the Borrower.
Notice given by the Borrower pursuant to this
subsection (iv) shall be irrevocable.
(v) The Administrative Agent shall notify
each bidding Lender whether or not its Competitive
Bid has been accepted (and if so, in what
principal amount and at what Competitive Bid Rate)
(A) in the case of a proposed Borrowing to consist
of Eurodollar Competitive Advances, promptly by
telex or telecopier and (B) in the case of a
proposed Borrowing to consist of Fixed Rate
Competitive Advances, by telephone (such
information to be confirmed in writing by the
Administrative Agent to the Lenders not later than
12:00 noon (New York City time) on such day), not
later than 10:30 A.M. (New York City time) on the
<PAGE>
28
day of the Competitive Borrowing and each
successful bidder will thereupon become bound,
subject to the other applicable conditions hereof,
to make the Competitive Advance in respect of
which its bid has been accepted. The
Administrative Agent shall not be required to
disclose to any Lender any other information with
respect to the Competitive Bids submitted, but the
Administrative Agent may, at the request of any
Lender, and at the instruction of the Borrower,
provide to such Lender certain information with
respect to Competitive Bids made and accepted as
deemed appropriate by the Borrower.
(vi) Neither the Administrative Agent nor any
Lender shall be responsible to the Borrower for
(A) a failure to fund a Competitive Advance on the
date such Advance is requested by the Borrower or
(B) the funding of such Advance at a Competitive
Bid Rate or in an amount other than that confirmed
pursuant to subsections (iv) and (v) above due to
delays in communications, miscommunications
(including, without limitation, any variance
between telephonic bids or acceptances and the
written notice provided by the Administrative
Agent to the Lenders pursuant to Sections (v)
above or the written confirmation supplied by the
Borrower pursuant to subsection (iv) above) and
the like among the Borrower, the Administrative
Agent and the Lenders, and the Borrower agrees to
indemnify each Lender for all reasonable costs and
expenses incurred by it on demand pursuant to
Section 4.03(e) hereof, as a result of any such
delay, miscommunication or the like that results
in a failure to fund a Competitive Advance or the
funding of a Competitive Advance at a Competitive
Bid Rate or in an amount other than that set forth
in the written notice provided by the
Administrative Agent to the Lenders pursuant to
subsection (v) above or the written confirmation
supplied by the Borrower pursuant to
subsection (iv) above.
(vii) If the Administrative Agent has
elected to submit a Competitive Bid in its
capacity as Lender, such bid must be submitted
directly to the Borrower one quarter of an hour
earlier than the latest time at which the other
Lenders are required to submit their bids to the
Administrative Agent pursuant to subsection (ii)
above.
(viii) A Competitive Bid Request for
Eurodollar Competitive Advances shall not be made
within five Business Days after the date of any
previous Competitive Bid Request for Eurodollar
Competitive Advances.
<PAGE>
29
(ix) All notices required by this
Section 3.04 must be made in accordance with
Section 10.02.
(x) To facilitate the administration of this
Agreement and the processing of Competitive Bids,
each Lender has submitted, or will submit upon
becoming a Lender pursuant to Section 10.07
hereof, to the Administrative Agent a completed
administrative questionnaire in the form of
Exhibit 3.04E, and each Lender agrees to promptly
notify the Administrative Agent in writing of any
change in the information so provided.
SECTION 05. Making of Advances. (a) Each Lender
shall, before 12:00 noon (New York City time) on the date of such Borrowing,
make available for the account of its Applicable Lending Office to the
Administrative Agent at the Administrative Agent's address referred to in
Section 10.02, in same day funds, such Lender's portion of such Borrowing.
Contract Advances shall be made by the Lenders pro rata and Competitive
Advances shall be made by the Lender or Lenders whose Competitive Bids
therefor have been accepted pursuant to Section 3.04(b)(iv) in the amounts so
accepted. After the Administrative Agent's receipt of such funds and upon
fulfillment of the applicable conditions set forth in Article V, the
Administrative Agent will make such funds available to the Borrower at the
Administrative Agent's aforesaid address.
(b) Unless the Administrative Agent shall have
received notice from a Lender prior to the date of any Borrowing that such
Lender will not make available to the Administrative Agent such Lender's
ratable portion of such Borrowing, the Administrative Agent may assume that
such Lender has made such portion available to the Administrative Agent on
the date of such Borrowing in accordance with subsection (a) of this
Section 3.05, and the Administrative Agent may, in reliance upon such
assumption, make available to the Borrower on such date a corresponding
amount. If and to the extent that any such Lender (a "non-performing
Lender") shall not have so made such ratable portion available to the
Administrative Agent, the non-performing Lender and the Borrower severally
agree to repay to the Administrative Agent forthwith on demand such
corresponding amount together with interest thereon, for each day from the
date such amount is made available to the Borrower until the date such amount
is repaid to the Administrative Agent, at (i) in the case of the Borrower,
the interest rate applicable at the time to Advances comprising such
Borrowing and (ii) in the case of such Lender, the Federal Funds Rate.
Nothing herein shall in any way limit, waive or otherwise reduce any claims
that any party hereto may have against any non-performing Lender.
(c) The failure of any Lender to make the Advance to
be made by it as part of any Borrowing shall not relieve any other Lender of
its obligation, if any, hereunder to make its Advance on the date of such
Borrowing, but no Lender shall be responsible for the failure of any other
Lender to make the Advance to be made by such other Lender on the date of any
Borrowing.
SECTION 06. Repayment of Advances. The Borrower
shall repay the principal amount of each Contract Advance on the Termination
Date. The Borrower shall repay the principal amount of each Competitive
Advance on the last day of the Interest Period for such Advance.
<PAGE>
30
SECTION 07. Interest. (a) Interest Periods. The
period between the date of each Advance and the date of payment in full of
such Advance shall be divided into successive periods of months or days
("Interest Periods") for purposes of computing interest applicable thereto;
provided that, in the case of Competitive Advances, the period from the date
of each Advance until the final maturity of such Advance shall be a single
Interest Period. The initial Interest Period for each Contract Advance shall
begin on the day such Advance is made, and each subsequent Interest Period
shall begin on the last day of the immediately preceding Interest Period for
such Advance. All Contract Advances and Competitive Advances comprising part
of the same Borrowing shall have the same Interest Period, as selected by the
Borrower in accordance with this Section 3.07(a) and the other provisions of
this Article III. The duration of each Interest Period shall be (i) in the
case of any Eurodollar Rate Advance or Eurodollar Competitive Advance, 1, 2,
3 or 6 months, (ii) in the case of any CD Rate Advance, 30, 60, 90 or 180
days, (iii) in the case of any Base Rate Advance, until the earlier of
repayment of such Advance in full or the Termination Date, and (iv) in the
case of any Fixed Rate Competitive Advance, any number of days, but no more
than 270 days; provided, however, that no Interest Period may be selected by
the Borrower if such Interest Period would end after the Termination Date.
(b) Interest Rates. The Borrower shall pay interest
on the unpaid principal amount of each Advance owing to each Lender from the
date of such Advance until such principal amount shall be paid in full, at
the Applicable Rate for such Advance (except as otherwise provided in this
subsection (b)), payable as follows:
(i) Eurodollar Rate Advances and Eurodollar
Competitive Advances. If such Advance is a
Eurodollar Rate Advance or Eurodollar Competitive
Advance, interest thereon shall be payable on the
last day of each Interest Period therefor and, if
any such Interest Period has a duration of more
than three months, also on the day of the third
month during such Interest Period which
corresponds to the first day of such Interest
Period (or, if any such month does not have a
corresponding day, then on the last day of such
month); provided that any amount of principal
which is not paid when due (whether on the
Termination Date, by acceleration or otherwise)
shall bear interest, from the date on which such
amount is due until such amount is paid in full,
payable on demand, at a rate per annum equal at
all times to (A) for the remaining term, if any,
of the Interest Period for such Advance, 2% per
annum above the Applicable Rate for such Advance
for such Interest Period, and (B) thereafter, 2%
per annum above the Applicable Rate in effect from
time to time for Base Rate Advances.
(ii) CD Rate Advances. If such Advance is a
CD Rate Advance, interest thereon shall be payable
on the last day of each Interest Period therefor
and, if any such Interest Period has a duration of
more than 90 days, also on the day which is
90 days from the first day of such Interest
<PAGE>
31
Period; provided that any amount of principal
which is not paid when due (whether on the
Termination Date, by acceleration or otherwise)
shall bear interest, from the date on which such
amount is due until such amount is paid in full,
payable on demand, at a rate per annum equal at
all times to (A) for the remaining term, if any,
of the Interest Period for such Advance, 2% per
annum above the Applicable Rate for such Advance
for such Interest Period, and (B) thereafter, 2%
per annum above the Applicable Rate in effect from
time to time for Base Rate Advances.
(iii) Base Rate Advances. If such
Advance is a Base Rate Advance, interest thereon
shall be payable quarterly on the last day of each
February, May, August and November and on the date
such Base Rate Advance shall be paid in full;
provided that any amount of principal which is not
paid when due (whether on the Termination Date, by
acceleration or otherwise) shall bear interest,
from the date on which such amount is due until
such amount is paid in full, payable on demand, at
a rate per annum equal at all times to 2% per
annum above the Applicable Rate in effect from
time to time for Base Rate Advances.
(iv) Fixed Rate Competitive Advances. If
such Advance is a Fixed Rate Competitive Advance,
interest thereon shall be payable on the last day
of the Interest Period therefor and, if any
Interest Period has a duration of more than
90 days, on each day which occurs during such
Interest Period every 90 days from the first day
of such Interest Period, provided that any amount
of principal which is not paid when due (whether
on the Termination Date, by acceleration or
otherwise) shall bear interest, from the date on
which such amount is due until such amount is paid
in full, payable on demand, at a rate per annum
equal at all times to (A) for the remaining, if
any, of the original stated maturity of such
Advance, 2% per annum above the rate of interest
applicable to such Advance immediately prior to
the date on which such amount became due, and
(B) thereafter, 2% per annum above the sum of the
Alternate Base Rate in effect from time to time
plus the Applicable Rate in effect from time to
time for Base Rate Advances.
(c) Other Amounts. Any other amounts payable
hereunder that are not paid when due shall (to the fullest extent permitted
by law) bear interest, from the date when due until paid in full, at a rate
per annum equal at all times to 2% per annum above the Applicable Rate in
effect from time to time for Base Rate Advances, payable on demand.
(d) Interest Rate Determinations. The Administrative
Agent shall give prompt notice to the Borrower and the Lenders of the
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32
Applicable Rate determined from time to time by the Administrative Agent for
each Contract Advance. Each Co-Agent agrees to furnish to the Administrative
Agent timely information for the purpose of determining the Eurodollar Rate
or CD Rate for any Interest Period. If any one Co-Agent shall not furnish
such timely information, the Administrative Agent shall determine such
interest rate on the basis of the timely information furnished by the other
two Co-Agents.
ARTICLE IV
PAYMENTS
SECTION 01. Payments and Computations. (a) The
Borrower shall make each payment hereunder and under the other Loan Documents
not later than 11:00 A.M. (New York City time) on the day when due in U.S.
Dollars to the Administrative Agent at its address referred to in Section
10.02 in same day funds. The Administrative Agent will promptly thereafter
cause to be distributed like funds relating to the payment of principal,
interest, fees or other amounts payable to the Lenders, to the respective
Lenders to whom the same are payable, for the account of their respective
Applicable Lending Offices, in each case to be applied in accordance with the
terms of this Agreement. Upon its acceptance of a Lender Assignment and
recording of the information contained therein in the Register pursuant to
Section 10.07, from and after the effective date specified in such Lender
Assignment, the Administrative Agent shall make all payments hereunder and
under the Notes in respect of the interest assigned thereby to the Lender
assignee thereunder, and the parties to such Lender Assignment shall make all
appropriate adjustments in such payments for periods prior to such effective
date directly between themselves.
(b) The Borrower hereby authorizes the Administrative
Agent and each Lender, if and to the extent payment owed to the
Administrative Agent or such Lender, as the case may be, is not made when due
hereunder (or, in the case of a Lender, under the Note held by such Lender),
to charge from time to time against any or all of the Borrower's accounts
with the Administrative Agent or such Lender, as the case may be, any amount
so due.
(c) All computations of interest based on the
Alternate Base Rate when based on the Prime Rate and of fees payable pursuant
to Section 2.02(a) and (b) shall be made by the Administrative Agent on the
basis of a year of 365 or 366 days, as the case may be. All computations of
interest and other amounts pursuant to Section 4.03 shall be made by the
Lender claiming such interest or other amount, on the basis of a year of
360 days. All other computations of interest and fees hereunder (including
computations of interest based on the Eurodollar Rate, the CD Rate and the
Federal Funds Rate (including the Alternate Base Rate if and so long as such
Rate is based on the Federal Funds Rate) and any interest rate applicable to
a Competitive Advance) shall be made by the Administrative Agent on the basis
of a year of 360 days. In each such case, such computation shall be made for
the actual number of days (including the first day but excluding the last
day) occurring in the period for which such interest or fees are payable.
Each such determination by the Administrative Agent or a Lender shall be
conclusive and binding for all purposes, absent manifest error.
(d) Whenever any payment hereunder or under any other
Loan Document shall be stated to be due, or the last day of an Interest
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33
Period hereunder shall be stated to occur, on a day other than a Business
Day, such payment shall be made and the last day of such Interest Period
shall occur on the next succeeding Business Day, and such extension of time
shall in such case be included in the computation of payment of interest and
fees hereunder; provided, however, that if such extension would cause payment
of interest on or principal of Eurodollar Rate Advances or Eurodollar
Competitive Advances to be made, or the last day of an Interest Period for a
Eurodollar Rate Advance or a Eurodollar Competitive Advance to occur, in the
next following calendar month, such payment shall be made on the next
preceding Business Day and such reduction of time shall in such case be
included in the computation of payment of interest hereunder.
(e) Unless the Administrative Agent shall have
received notice from the Borrower prior to the date on which any payment is
due to the Lenders hereunder that the Borrower will not make such payment in
full, the Administrative Agent may assume that the Borrower has made such
payment in full to the Administrative Agent on such date and the
Administrative Agent may, in reliance upon such assumption, cause to be
distributed to each Lender on such due date an amount equal to the amount
then due such Lender. If and to the extent the Borrower shall not have so
made such payment in full to the Administrative Agent, such Lender shall
repay to the Administrative Agent forthwith on demand such amount distributed
to such Lender, together with interest thereon, for each day from the date
such amount is distributed to such Lender until the date such Lender repays
such amount to the Administrative Agent, at the Federal Funds Rate.
SECTION 02. Prepayments. (a) The Borrower shall have
no right to prepay any principal amount of any Contract Advances except in
accordance with subsection (b) below. The Borrower shall have no right to
prepay any principal amount of any Competitive Advance.
(b) The Borrower may, upon at least one Business Days'
notice to the Administrative Agent stating the proposed date and aggregate
principal amount of the prepayment, and if such notice is given, the Borrower
shall, prepay the outstanding principal amounts of Contract Advances
comprising part of the same 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 each partial prepayment shall be in an
aggregate principal amount not less than $10,000,000.
(c) On the Merger Effective Date, the Borrower shall
prepay outstanding Advances in such amount necessary to reduce such
outstanding Advances to an aggregate amount equal to $125,000,000.
SECTION 03. Yield Protection. (a) Change in
Circumstances. Notwithstanding any other provision herein, if after the date
hereof, the adoption of or any change in applicable law or regulation or in
the interpretation or administration thereof by any governmental authority
charged with the interpretation or administration thereof (whether or not
having the force of law) shall (i) change the basis of taxation of payments
to any Lender of the principal of or interest on any Eurodollar Rate Advance,
CD Rate Advance or Competitive Advance made by such Lender or any fees or
other amounts payable hereunder (other than changes in respect of taxes
imposed on the overall net income of such Lender or its Applicable Lending
Office by the jurisdiction in which such Lender has its principal office or
in which such Applicable Lending Office is located or by any political
subdivision or taxing authority therein), or (ii) shall impose, modify or
deem applicable any reserve, special deposit or similar requirement against
<PAGE>
34
commitments or assets of, deposits with or for the account of, or credit
extended by, such Lender (excluding, in the case of CD Rate Advances, any
such requirement included in the Domestic Reserve Adjustment), or (iii) shall
impose on such Lender or the London interbank market any other condition
affecting this Agreement or Eurodollar Rate Advances, CD Rate Advances or
Competitive Advances made by such Lender, and the result of any of the
foregoing shall be to increase the cost to such Lender of agreeing to make,
making or maintaining any Advance or to reduce the amount of any sum received
or receivable by such Lender hereunder or under the Notes (whether of
principal, interest or otherwise), then the Borrower will pay to such Lender
upon demand such additional amount or amounts as will compensate such Lender
for such additional costs incurred or reduction suffered.
(b) Capital. If any Lender shall have determined that
the applicability of any law, rule, regulation or guideline adopted pursuant
to or arising out of the July 1988 report of the Basle Committee on Banking
Regulations and Supervisory Practices entitled "International Convergence of
Capital Measurement and Capital Standards", or the adoption after the date
hereof of any law, rule, regulation or guideline regarding capital adequacy,
or any change in any of the foregoing or in the interpretation or
administration of any of the foregoing by any governmental authority, central
bank or comparable agency charged with the interpretation or administration
thereof, or compliance by any Lender (or any Applicable Lending Office of
such Lender) or any Lender's holding company with any request or directive
regarding capital adequacy (whether or not having the force of law) of any
such authority, central bank or comparable agency, has or would have the
effect (i) of reducing the rate of return on such Lender's capital or on the
capital of such Lender's holding company, if any, as a consequence of this
Agreement, the Commitment of such Lender hereunder or the Advances made by
such Lender pursuant hereto to a level below that which such Lender or such
Lender's holding company could have achieved, but for such applicability,
adoption, change or compliance (taking into consideration such Lender's
policies and the policies of such Lender's holding company with respect to
capital adequacy), or (ii) of increasing or otherwise determining the amount
of capital required or expected to be maintained by such Lender or such
Lender's holding company based upon the existence of this Agreement, the
Commitment of such Lender hereunder, the Advances made by such Lender
pursuant hereto and other similar such commitments, agreements or assets,
then from time to time the Borrower shall pay to such Lender upon demand such
additional amount or amounts as will compensate such Lender or such Lender's
holding company for any such reduction or allocable capital cost suffered.
(c) Eurodollar Reserves. The Borrower shall pay to
each Lender upon demand, 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 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 Advance
from (ii) the rate obtained by dividing such Eurodollar Rate by a percentage
equal to 100% minus the Eurodollar Reserve Percentage of such Lender for such
Interest Period. Such additional interest shall be determined by such Lender
and notified to the Borrower and the Administrative Agent.
(d) Breakage Indemnity. The Borrower shall indemnify
each Lender against any loss, cost or reasonable expense which such Lender
<PAGE>
35
may sustain or incur as a consequence of (i) any failure by the Borrower to
fulfill on the date of any Borrowing hereunder the applicable conditions set
forth in Article V, (ii) any failure by the Borrower to borrow or Convert any
Advance hereunder after irrevocable Notice of Borrowing or Notice of
Conversion has been given pursuant to Section 3.01 or 3.02, (iii) any
payment, prepayment or Conversion of a Eurodollar Rate Advance or CD Rate
Advance required or permitted by any other provision of this Agreement or
otherwise made or deemed made on a date other than the last day of the
Interest Period applicable thereto, (iv) any default in payment or prepayment
of the principal amount of any Advance or any part thereof or interest
accrued thereon, as and when due and payable (at the due date thereof, by
irrevocable notice of prepayment or otherwise) or (v) the occurrence of any
Event of Default, including, in each such case, any loss or reasonable
expense sustained or incurred or to be sustained or incurred in liquidating
or employing deposits from third parties acquired to effect or maintain such
Advance or any part thereof as a Eurodollar Rate Advance, CD Rate Advance or
Competitive Advance. Such loss, cost or reasonable expense shall include an
amount equal to the excess, if any, as reasonably determined by such Lender,
of (A) its cost of obtaining the funds for the Advance being paid, prepaid,
Converted or not borrowed (based on the Eurodollar Rate or CD Rate) for the
period from the date of such payment, prepayment, Conversion or failure to
borrow to the last day of the Interest Period for such Advance (or, in the
case of a failure to borrow, the Interest Period for such Advance which would
have commenced on the date of such failure) over (B) the amount of interest
(as reasonably determined by such Lender) that would be realized by such
Lender in reemploying the funds so paid, prepaid, Converted or not borrowed
for such period or Interest Period, as the case may be. For purposes of this
subsection (d), it shall be presumed that each Lender shall have funded each
such Advance with a fixed-rate instrument bearing the rates and maturities
designated in the determination of the Applicable Rate for such Advance.
(e) Notices. A certificate of each Lender setting
forth such Lender's claim for compensation hereunder and the amount necessary
to compensate such Lender or its holding company pursuant to subsections (a)
through (d) of this Section 4.03 shall be submitted to the Borrower and the
Administrative Agent and shall be conclusive and binding for all purposes,
absent manifest error. The Borrower shall pay each Lender directly the
amount shown as due on any such certificate within 10 days after its receipt
of the same. The failure of any Lender to provide such notice or to make
demand for payment under this Section 4.03 shall not constitute a waiver of
such Lender's rights hereunder; provided that such Lender shall not be
entitled to demand payment pursuant to subsections (a) through (d) of this
Section 4.03, in respect of any loss, cost, expense, reduction or reserve, if
such demand is made more than one year following the later of such Lender's
incurrence or sufferance thereof or such Lender's actual knowledge of the
event giving rise to such Lender's rights pursuant to such subsections. The
protection of this Section 4.03 shall be available to each Lender regardless
of any possible contention of the invalidity or inapplicability of the law,
rule, regulation, guideline or other change or condition which shall have
occurred or been imposed.
(f) Change in Legality. Notwithstanding any other
provision herein, if the adoption of or any change in any law or regulation
or in the interpretation or administration thereof by any governmental
authority charged with the administration or interpretation thereof shall
make it unlawful for any Lender to make or maintain any Eurodollar Rate
Advance or Eurodollar Competitive Advance or to give effect to its
obligations as contemplated hereby with respect to any Eurodollar Rate
<PAGE>
36
Advance or Eurodollar Competitive Advance, then, by written notice to the
Borrower and the Administrative Agent, such Lender may:
(i) declare that Eurodollar Rate Advances
and Eurodollar Competitive Advances will not
thereafter be made by such Lender hereunder,
whereupon the right of the Borrower to select
Eurodollar Rate Advances for any Borrowing or
Conversion and any Competitive Borrowing
consisting of Eurodollar Competitive Advances
shall be forthwith suspended until such Lender
shall withdraw such notice as provided hereinbelow
or shall cease to be a Lender hereunder pursuant
to Section 10.07(g) hereof; and
(ii) require that all outstanding Eurodollar
Rate Advances and Eurodollar Competitive Advances
made by it be Converted to Base Rate Advances, in
which event all such Eurodollar Rate Advances and
Eurodollar Competitive Advances by all Lenders
shall be automatically Converted to Base Rate
Advances as of the effective date of such notice
as provided herein below.
Upon receipt of any such notice, the Administrative Agent shall promptly
notify the other Lenders. Promptly upon becoming aware that the
circumstances that caused such Lender to deliver such notice no longer exist,
such Lender shall deliver notice thereof to the Borrower and the
Administrative Agent withdrawing such prior notice (but the failure to do so
shall impose no liability upon such Lender). Promptly upon receipt of such
withdrawing notice from such Lender (or upon such Lender assigning all of its
Commitments, Advances, participation and other rights and obligations
hereunder in accordance with Section 10.07(g)), the Administrative Agent
shall deliver notice thereof to the Borrower and the Lenders and such
suspension shall terminate. Prior to any Lender giving notice to the
Borrower under this subsection (f), such Lender shall use reasonable efforts
to change the jurisdiction of its Applicable Lending Office, if such change
would avoid such unlawfulness and would not, in the sole determination of
such Lender, be otherwise disadvantageous to such Lender. Any notice to the
Borrower by any Lender shall be effective as to each Eurodollar Rate Advance
and Eurodollar Competitive Advance on the last day of the Interest Period
currently applicable to such Eurodollar Rate Advance or Eurodollar
Competitive Advance; provided that if such notice shall state that the
maintenance of such Advance until such last day would be unlawful, such
notice shall be effective on the date of receipt by the Borrower and the
Administrative Agent.
(g) Market Rate Disruptions. If, (i) less than two
Co-Agents furnish timely information to the Administrative Agent for
determining the Eurodollar Rate for Eurodollar Rate Advances or the CD Rate
for CD Advances, in connection with any proposed Borrowing or Conversion or
(ii) if the Majority Lenders shall notify the Administrative Agent that the
Eurodollar Rate or CD Rate, as the case may be, will not adequately reflect
the cost to such Majority Lenders of making, funding or maintaining their
respective Eurodollar Rate Advances or CD Rate Advances, respectively, the
right of the Borrower to select or receive such Type of Advances for any
Borrowing or Conversion shall be forthwith suspended until the Administrative
Agent shall notify the Borrower and the Lenders that the circumstances
<PAGE>
37
causing such suspension no longer exist, and until such notification from the
Administrative Agent each requested Borrowing or Conversion into such Type of
Advance hereunder shall be deemed to be a request for Base Rate Advances.
SECTION 04. 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, but excluding any proceeds
received by assignments or sales of participation in accordance with
Section 10.07 hereof to a Person that is not an Affiliate of the Borrower) on
account of the Advances owing to it (other than pursuant to Section 4.03
hereof) in excess of its ratable share of payments on account of the Advances
obtained by all the Lenders, such Lender shall forthwith purchase from the
other Lenders such participation in the Advances owing to them as shall be
necessary to cause such purchasing Lender to share the excess payment ratably
with each of them; provided, however, that if all or any portion of such
excess payment is thereafter recovered from such purchasing Lender, such
purchase from each Lender shall be rescinded and such Lender shall repay to
the purchasing Lender the purchase price to the extent of such recovery
together with an amount equal to such Lender's ratable share (according to
the proportion of (i) the amount of such Lender's required repayment to
(ii) the total amount so recovered from the purchasing Lender) of any
interest or other amount paid or payable by the purchasing Lender in respect
of the total amount so recovered. The Borrower agrees that any Lender so
purchasing a participation from another Lender pursuant to this Section 4.04
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. Notwithstanding the foregoing, if any Lender
shall obtain any such excess payment involuntarily, such Lender may, in lieu
of purchasing participation from the other Lenders in accordance with this
Section 4.04, on the date of receipt of such excess payment, return such
excess payment to the Administrative Agent for distribution in accordance
with Section 4.01(a).
SECTION 05. Taxes. (a) All payments by the Borrower
hereunder and under the other Loan Documents shall be made in accordance with
Section 4.01, free and clear of and without deduction for all present or
future taxes, levies, imposts, deductions, charges or withholdings, and all
liabilities with respect thereto, excluding, in the case of each Lender and
the Administrative Agent, taxes imposed on its overall net income, and
franchise taxes imposed on it, by the jurisdiction under the laws of which
such Lender or the Administrative Agent (as the case may be) is organized or
any political subdivision thereof and, in the case of each Lender, taxes
imposed on its 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 other Loan
Document to any Lender or the Administrative Agent, (i) the sum payable shall
be increased as may be necessary so that after making all required deductions
(including deductions applicable to additional sums payable under this
Section 4.05) such Lender or the Administrative Agent (as the case may be)
receives an amount equal to the sum it would have received had no such
deductions been made, (ii) the Borrower shall make such deductions and
(iii) the Borrower shall pay the full amount deducted to the relevant
taxation authority or other authority in accordance with applicable law.
<PAGE>
38
(b) In addition, the Borrower agrees to pay any
present or future stamp or documentary taxes or any other excise or property
taxes, charges or similar levies that arise from any payment made hereunder
or under any other Loan Document or from the execution, delivery or
registration of, or otherwise with respect to, this Agreement or any other
Loan Document (hereinafter referred to as "Other Taxes").
(c) The Borrower will indemnify each Lender and the
Administrative Agent for the full amount of Taxes and Other Taxes (including,
without limitation, any Taxes and any Other Taxes imposed by any jurisdiction
on amounts payable under this Section 4.05) paid by such Lender or the
Administrative Agent (as the case may be) and any liability (including
penalties, interest and expenses) arising therefrom or with respect thereto,
whether or not such Taxes or Other Taxes were correctly or legally asserted.
This indemnification shall be made within 30 days from the date such Lender
or the Administrative Agent (as the case may be) makes written demand
therefor. If any Taxes or Other Taxes for which a Lender or the
Administrative Agent has received payments from the Borrower hereunder shall
be finally determined to have been incorrectly or illegally asserted and are
refunded to such Lender or the Administrative Agent, such Lender or the
Administrative Agent, as the case may be, shall promptly forward to the
Borrower any such refunded amount. The Borrower's, the Administrative
Agent's and each Lender's obligations under this Section 4.05 shall survive
the payment in full of the Advances.
(d) Within 30 days after the date of any payment of
Taxes, the Borrower will furnish to the Administrative Agent, at its address
referred to in Section 10.02, the original or a certified copy of a receipt
evidencing payment thereof.
(e) Each Lender shall, on or prior to the date it
becomes a Lender hereunder, deliver to the Borrower and the Administrative
Agent such certificates, documents or other evidence, as required by the
Internal Revenue Code of 1986, as amended from time to time (the "Code"), or
treasury regulations issued pursuant thereto, including Internal Revenue
Service Form 4224 and any other certificate or statement of exemption
required by Treasury Regulation Section 1.1441-1(a) or Section 1.1441-6(c) or
any subsequent version thereof, properly completed and duly executed by such
Lender establishing that it is (i) not subject to withholding under the Code
or (ii) totally exempt from United States of America tax under a provision of
an applicable tax treaty. Each Lender shall promptly notify the Borrower and
the Administrative Agent of any change in its Applicable Lending Office and
shall deliver to the Borrower and the Administrative Agent together with such
notice such certificates, documents or other evidence referred to in the
immediately preceding sentence. Unless the Borrower and the Administrative
Agent have received forms or other documents satisfactory to them indicating
that payments hereunder or under the Notes are not subject to United States
of America withholding tax or are subject to such tax at a rate reduced by an
applicable tax treaty, the Borrower or the Administrative Agent shall
withhold taxes from such payments at the applicable statutory rate in the
case of payments to or for any Lender organized under the laws of a
jurisdiction outside the United States of America. Each Lender represents
and warrants that each such form supplied by it to the Administrative Agent
and the Borrower pursuant to this Section 4.05, and not superseded by another
form supplied by it, is or will be, as the case may be, complete and
accurate.
<PAGE>
39
(f) Any Lender claiming any additional amounts payable
pursuant to this Section 4.05 shall use reasonable efforts (consistent with
legal and regulatory restrictions) to file any certificate or document
requested by the Borrower or to change the jurisdiction of its Applicable
Lending Office if the making of such a filing or change would avoid the need
for or reduce the amount of any such additional amounts which may thereafter
accrue and would not, in the sole determination of such Lender, be otherwise
disadvantageous to such Lender.
ARTICLE V
CONDITIONS PRECEDENT
SECTION 01. Conditions Precedent to Commitment
Closing. The commitments of the Lenders to make Advances under and in
accordance with this Agreement shall not become effective until the following
conditions precedent shall have been fulfilled:
(a) The Administrative Agent shall have received
the following, each dated the date of delivery thereof
(unless otherwise specified below), in form and
substance satisfactory to each Lender and in sufficient
copies for each Lender:
(i) Certified copies of the resolutions of
the Board of Directors of the Borrower and NUSCO
approving, if and to the extent necessary, this
Agreement, the other Loan Documents and the other
documents to be delivered by the Borrower
hereunder and thereunder, and of all documents
evidencing other necessary corporate action, if
any, with respect to the execution, delivery and
performance by the Borrower of this Agreement and
the other Loan Documents.
(ii) A certificate of the Secretary of the
Borrower certifying (A) the names and true
signatures of the officers of the Borrower
authorized to sign this Agreement and the other
Loan Documents and the other documents to be
delivered hereunder and thereunder and (B) that
attached thereto are true and correct copies of
the Articles of Incorporation of the Borrower, and
all amendments thereto, and the By-laws of the
Borrower, in each case as in effect on such date.
(iii) A true and complete copy of the
other Financing Agreement, as executed by the
parties thereto.
(iv) Financial projections, on assumptions
acceptable to the Lenders, demonstrating projected
compliance with Section 7.01(j) hereof and the
terms of the other Financing Agreement (both
giving effect to, and not giving effect to, the
Merger and the Seabrook Transfer on a prospective
basis).
<PAGE>
40
(v) An audited balance sheet of the Borrower
as at December 31, 1990 and certified financial
statements of the Borrower setting forth the
results of operations of the Borrower for the
fiscal period ending on such date, together with
pro-forma adjustments thereto, certified by the
Treasurer or Assistant Treasurer, or other officer
satisfactory to the Majority Lenders, that such
pro-formas were prepared in good faith and on
reasonable assumptions, in form and substance
satisfactory to the Lenders and conforming with
the projected financial information referred to in
subsection (iv) above (A) reflecting the proposed
capital structure of the Borrower as of June 1,
1991 after giving effect to the reorganization of
the Borrower (the "Plan Pro-formas") and
(B) reflecting the proposed capital structure of
the Borrower after giving effect to the Merger
(the "Merger Pro-formas").
(vi) True and complete copies of a favorable
ruling by the Internal Revenue Service in response
to the requests of NU as described in the Form S-1
insofar as they relate to consummation of the
Plan.
(vii) A certificate of a duly authorized
officer of the Borrower certifying that
Schedule IV hereto includes a description of all
pending or known threatened actions or proceedings
affecting the Borrower or its properties before
any court, governmental agency or arbitrator,
which may, if adversely determined (A) purport to
affect the legality, validity or enforceability of
the Plan, the Rate Agreement, the Merger
Agreement, any Loan Document or any Significant
Contract or (B) materially adversely affect the
financial condition, properties, prospects or
operations of the Borrower.
(viii) A true and complete copy of the
order of the Bankruptcy Court confirming the Plan.
(ix) Such other approvals, opinions and
documents as any Lender, through the
Administrative Agent, may reasonably request as to
the legality, validity, binding effect or
enforceability of this Agreement and the other
Financing Agreement.
(b) The Borrower shall have paid all fees under
or referenced in Section 2.02 hereof, to the extent
then due and payable.
(c) The Commitment Closing shall have occurred on
or prior to June 30, 1991.
<PAGE>
41
SECTION 02. Conditions Precedent to Funding Date. The
obligation of each Lender to make its initial Advances is subject to the
fulfillment of the conditions precedent that the Administrative Agent shall
have received on or before the day of such Advances the following, each dated
such day (except where specified otherwise below), in form and substance
satisfactory to each Lender (except where specified otherwise below) and
(except for the Notes) in sufficient copies for each Lender:
(a) The Notes to the order of the respective
Lenders, duly executed by the Borrower.
(b) The Security Documents, duly executed by the
Borrower, together with:
(1) photocopies of Financing Statements
(Form UCC-1) dated on or before the Funding Date
duly executed on behalf of the Borrower and in
proper form for filing under the Uniform
Commercial Code in the State of New Hampshire to
perfect the Liens (to the extent such Liens may be
perfected by filing) created by the Security
Documents and oral confirmation from Sulloway
Hollis & Soden that the executed originals of such
Financing Statements have been duly filed, and
(2) oral confirmation from Sulloway Hollis &
Soden of each completion of all recordings and
filings of the Security Documents and all other
actions, as may be necessary or, in the opinion of
the Collateral Agent, desirable to perfect the
Liens created by the Security Documents.
(c) Evidence that the other Financing Agreement
is in full force and effect on such date and that the
initial fundings under the Financing Agreement will
occur on the Funding Date in accordance with the terms
thereof.
(d) True and complete photocopies of the Rate
Agreement, the Merger Agreement and the Significant
Contracts in effect on the Funding Date and all
amendments, modifications and supplements thereto, in
each such case (other than the Merger Agreement) duly
executed by the respective parties thereto.
(e) Copies, certified by the Borrower, of all
Governmental Approvals listed in Part A of Schedule II
hereof.
(f) Copies certified by appropriate officers of
each of NU, NUSCO and The Connecticut Light and Power
Company of (i) the resolutions of the Board of
Directors or Board of Trustees of such Person approving
the Merger Agreement, the Rate Agreement and the
Significant Contracts then in effect to which it is a
party and (ii) all other corporate or similar action
required to authorize the execution, delivery and
performance thereof on behalf of such Person.
<PAGE>
42
(g) A certificate of the Secretary of each of NU,
NUSCO and The Connecticut Light and Power Company
certifying the names and true signatures of the
officers of such Person authorized to sign the Merger
Agreement, the Rate Agreement and other Significant
Contracts referred to in subsection (f) above to which
it is a party and all other documents to be delivered
in connection therewith on behalf of such Person.
(h) A certificate of the Secretary of the
Borrower certifying that (i) attached thereto are true
and correct copies of the Articles of Incorporation of
the Borrower and the By-laws of the Borrower, in each
case as in effect on such date and including any and
all changes and modifications thereto required under
the Plan and (ii) the resolutions of the Board of
Directors of the Borrower referred to in
Section 5.01(a)(i) are in full force and effect and
have not been modified, supplemented, revised or
changed in any way since the date on which they were
previously delivered, which would adversely affect the
execution, delivery and performance by the Borrower of
this Agreement and the other Loan Documents; any
adverse modification, supplement, revision or change
shall be subject to the approval of the Majority
Lenders.
(i) A certificate of the Secretary of NUSCO
certifying that the resolutions of the Board of
Directors of NUSCO referred to in Section 5.01(a)(i)
are in full force and effect and have not been
modified, supplemented, revised or changed in any way
since the date on which they were previously delivered,
which would adversely affect the execution, delivery
and performance of the Borrower of this Agreement and
the other Loan Documents; any adverse modification,
supplement, revision or change shall be subject to the
approval of the Majority Lenders.
(j) A certificate signed by the Treasurer or
Assistant Treasurer of the Borrower, certifying as to
the absence of any material adverse change in the
financial condition, operations, properties or
prospects of the Borrower from the Plan Pro-formas
after giving effect to the transactions occurring on
the Plan Effective Date.
(k) A certificate signed by the Chief Financial
Officer, Treasurer or Assistant Treasurer of NU,
certifying as to the absence of any material adverse
change in the financial condition, operations,
properties or prospects of NU since December 31, 1990
and certifying that the audited consolidated balance
sheets of NU as at December 31, 1990 and the related
statements of NU setting forth the results of
operations of NU and its subsidiaries for the fiscal
year then ended, copies of which have been furnished to
<PAGE>
43
each Bank, fairly present the financial condition and
results of operations of NU and its subsidiaries on a
consolidated basis at and for the year ended on such
date, and have been prepared in accordance with
generally accepted accounting principles consistently
applied.
(l) A certificate of a duly authorized officer of
the Borrower stating that (i) the representations and
warranties contained in Section 6.01 are correct, in
all material respects, on and as of the Funding Date
before and after giving effect to the initial Advances
to be made on such date and the application of the
proceeds thereof, as though made on and as of such
date, (ii) no event has occurred and is continuing
which constitutes an Event of Default or Unmatured
Default, or would result from such initial Advances or
the application of the proceeds thereof and
(iii) "Seabrook" is in "commercial operation" (as such
terms are referred to in the Rate Agreement).
(m) Certificates signed by duly authorized
officers of the Borrower and NU to the effect that all
conditions to the occurrence of the Plan Effective Date
set forth in Article VIII, Section B of the Plan and in
any amendments, supplements or modifications to the
Plan or to the order of the Bankruptcy Court (referred
to in Section 5.01(a)(viii)) shall have been satisfied
or waived. Such certificates shall set forth in
reasonable detail any such conditions which were waived
and the aggregate amounts of (i) the allowed Class 10
and Class 10A claims and the face amounts or estimated
amounts, as the case may be, of disputed and
unliquidated claims referred to in paragraph 2.j. of
Article VIII, Section B of the Plan and (ii) the
allowed administrative costs and expenses not paid
prior to the Plan Effective Date, as referred to in
paragraph 2.l. of Article VIII, Section B of the Plan.
The waiver of any condition shall be subject to the
approval of the Majority Lenders.
(n) Certificates signed by duly authorized
officers of the Borrower and NU setting forth the Plan
Effective Date and certifying to the effect that the
Plan Effective Date will occur concurrently with the
initial Advances.
(o) A true and complete copy of any and all
orders of the Bankruptcy Court amending or
supplementing the order confirming the Plan furnished
pursuant to Section 5.01(a)(viii),if such amendment or
supplemental order changes or adds any conditions to
the occurrence of the Plan Effective Date or any
material term of the Plan.
(p) A certificate of a duly authorized officer of
the Borrower describing in reasonable detail all
insurance policies and self-insurance programs
<PAGE>
44
maintained by the Borrower relating to property
insurance and liability insurance, which shall comply
with the requirements of Section 7.01(c) hereof and
Section 2.03 of each of the PSNH Mortgage and the
Seabrook Mortgage, and certifying that all such
policies are fully paid and in full force and effect.
(q) A certificate of a duly authorized officer of
the Borrower updating, if necessary, any information
set forth or required to be set forth in Schedule IV
hereto. Any adverse change reflected in such updated
certificate shall be subject to the approval of the
Majority Lenders.
(r) Evidence of the issuance at or about par, on
terms described in the Form S-1 or in the Preliminary
Official Statements and any amendments or supplements
thereto relating to the First Mortgage Bonds, of
(i) not less than $858,985,000 aggregate principal
amount of First Mortgage Bonds and (ii) the Preferred
Stock.
(s) True and correct copies of the Series D
Letter of Credit and Reimbursement Agreement and the
Series E Letter of Credit and Reimbursement Agreement,
in form and substance satisfactory to the Majority
Lenders.
(t) Favorable opinions of:
(i) Day, Berry & Howard, counsel to NU, in
substantially the form of Exhibit 5.02A and as to
such other matters as the Majority Lenders,
through the Administrative Agent, may reasonably
request;
(ii) Sulloway Hollis & Soden, special New
Hampshire counsel to the Borrower, in
substantially the form of Exhibit 5.02B and as to
such other matters as the Majority Lenders,
through the Administrative Agent, may reasonably
request;
(iii) Pierre O. Caron, Assistant General
Counsel of the Borrower, in substantially the form
of Exhibit 5.02C and as to such other matters as
the Majority Lenders, through the Administrative
Agent, may reasonably request;
(iv) Drummond Woodsum Plimpton & MacMahon,
special Maine counsel to the Borrower, in
substantially the form of Exhibit 5.02D and as to
such other matters as the Majority Lenders,
through the Administrative Agent, may reasonably
request;
(v) Zuccaro, Willis & Bent, special Vermont
counsel to the Borrower, in substantially the form
<PAGE>
45
of Exhibit 5.02E and as to such other matters as
the Majority Lenders, through the Administrative
Agent, may reasonably request;
(vi) Mintz, Levin, Cohn, Ferris, Glovsky and
Popeo, P.C., special New Hampshire counsel to the
Lenders, in substantially the form of
Exhibit 5.02F, and as to such other matters as the
Majority Lenders, through the Administrative Agent
may reasonable request; and
(vii) Porter & Travers, counsel to the
Co-Agents, in substantially the form of Exhibit
5.02G, and as to such other matters as the
Majority Lenders, through the Administrative
Agent, may reasonably request.
(u) Payment of the fees referred to in Section
2.02 hereof, to the extent then due and payable.
(v) A certificate signed by the Assistant General
Counsel of the Borrower certifying that (i) the New
Hampshire Supreme Court has not granted any motion for
rehearing, motion for stay or any request for similar
relief in connection with case no. 90-406 captioned
Appeal of Robert C. Richards, et. al. and (ii) no other
court shall have granted a motion for stay or any
request for similar relief in connection with the Plan,
the Loan Documents, the initial First Mortgage Bonds,
the Preferred Stock or the transactions contemplated
thereunder.
(w) Such other approvals, opinions and documents
as the Majority Lenders, through the Administrative
Agent, may reasonably request as to the legality,
validity, binding effect or enforceability of the Loan
Documents or the financial condition, properties,
operations or prospects of the Borrower.
SECTION 03. Conditions Precedent to Each Advance. The
obligation of any Lender to make any Advance (other than the initial Advance
on the Funding Date and other than with respect to a Conversion) hereunder
shall be subject to the further conditions precedent that, on the date of
such Advance and after giving effect thereto:
(a) the following statement shall be true (and each of
the giving of the applicable notice or request with respect to such Advance
and the performance of such Advance without prior correction by the Borrower
shall constitute a representation and warranty by the Borrower that on the
date of such Advance such statements are true):
(i) the representations and warranties
contained in Section 6.01 of this Agreement, in
Section 1.02 of the Seabrook Mortgage and in
Section 1.02 of the PSNH Mortgage are correct on
and as of the date of such Advance, before and
after giving effect to such Advance and to the
<PAGE>
46
application of the proceeds therefrom, as though
made on and as of such date, and
(ii) no Event of Default or Unmatured Default
has occurred and is continuing, or would result
from such Advance or from the application of the
proceeds thereof; and
(b) the Borrower shall have furnished to the
Administrative Agent such other approvals, opinions or documents as any
Lender, through the Administrative Agent, may reasonably request as to the
legality, validity, binding effect or enforceability of the Loan Document.
SECTION 04. Reliance on Certificates. The Lenders and
the Administrative Agent shall be entitled to rely conclusively upon the
certificates delivered from time to time by officers of the Borrower, NU and
the other parties to the Significant Contracts as to the names, incumbency,
authority and signatures of the respective persons named therein until such
time as the Administrative Agent may receive a replacement certificate, in
form acceptable to the Administrative Agent, from an officer of such Person
identified to the Administrative Agent as having authority to deliver such
certificate, setting forth the names and true signatures of the officers and
other representatives of such Person thereafter authorized to act on behalf
of such Person.
ARTICLE VI
REPRESENTATIONS AND WARRANTIES
SECTION 01. Representations and Warranties of the
Borrower. The Borrower represents and warrants as follows:
(a) Prior to the Funding Date, the Borrower is a
debtor-in-possession under the Bankruptcy Code pursuant to a voluntary
proceeding under the jurisdiction of the Bankruptcy Court and, on and after
the Funding Date, will be a corporation duly organized and validly existing
under the laws of the State of New Hampshire. The Borrower 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 qualifications necessary.
(b) The execution, delivery and performance by the
Borrower of the Rate Agreement, the Merger Agreement, each Loan Document and
each Significant Contract to which it is a party are within the Borrower's
corporate powers, have been duly authorized by all necessary corporate
action, and do not and will not contravene (i) the Borrower's charter or
by-laws or (ii) on and after the Funding Date (subject to obtaining any
required Governmental Approval with respect to the Merger Agreement, the
Agreement for Capacity Transfer, the Sharing Agreement and the Unit
Contract), any law or legal or contractual restriction binding on or
affecting the Borrower; and such execution, delivery and performance do not
or will not result in or require the creation of any Lien (other than
pursuant hereto or the Security Documents or the First Mortgage Indenture)
upon or with respect to any of its properties.
(c) No Governmental Approval referred to in clauses
(i) and (ii) in the definition of "Governmental Approvals" is required except
<PAGE>
47
as listed in Schedule II hereto, each of which, from and after the Funding
Date (in the case of Part A of said Schedule II) or the Merger Effective Date
(in the case of Part B of said Schedule II) will have been duly obtained or
made, and will be in full force and effect; and except as set forth in
Schedule IV hereto or in the certificate referred to in Section 5.02(q)
hereof, all applicable periods of time for review, rehearing or appeal with
respect thereto shall have expired on such dates; and the Borrower has
obtained all Governmental Approvals referred to in clause (iii) in the
definition of "Governmental Approvals", except those not yet required but
which are obtainable in the ordinary course of business as and when required
and those the absence of which would not materially adversely affect the
financial condition, properties, prospects or operations of the Borrower as a
whole.
(d) This Agreement, the Rate Agreement and the Merger
Agreement are, and each other Loan Document and each Significant Contract to
which the Borrower will be a party when delivered hereunder will be, legal
(subject to obtaining any required Governmental Approval with respect to the
Merger Agreement, the Agreement for Capacity Transfer, the Sharing Agreement
and the Unit Contract), valid and binding obligations of the Borrower
enforceable against the Borrower in accordance with their respective terms;
subject to the qualification, however, that the enforcement of the rights and
remedies herein and therein is subject to bankruptcy and other similar laws
of general application affecting rights and remedies of creditors and that
the remedy of specific performance or of injunctive relief is subject to the
discretion of the court before which any proceedings therefor may be brought.
(e) The audited balance sheet of the Borrower as at
December 31, 1990, and the related statements of the Borrower setting forth
the results of operations of the Borrower for the fiscal year then ended,
copies of which have been furnished to each Bank, fairly present in all
material respects the financial condition and results of operations of the
Borrower at and for the year ended on such date, and have been prepared in
accordance with generally accepted accounting principles consistently
applied. The Plan Pro-formas, the Merger Pro-formas and the financial
projections referred to in Section 5.01(a)(iv), have each been prepared in
good faith and on reasonable assumptions. Since December 31, 1990, there has
been no material adverse change in the Borrower's financial condition,
operations, properties or prospects other than as reflected by specific
notation in the Plan Pro-formas. The Borrower has no material non-contingent
liabilities as of the Plan Effective Date, after giving effect to the Plan,
except as reflected in the Plan Pro-formas and as evidenced by the Loan
Documents and all contingent liabilities have been appropriately reserved.
(f) Except as set forth in Schedule IV hereto or in
the certificate referred to in Section 5.02(q) hereof, there is no pending or
known threatened action or proceeding (including, without limitation, any
action or proceeding relating to any environmental protection laws or
regulations) affecting the Borrower or its properties before any court,
governmental agency or arbitrator, which may, if adversely determined,
(i) purport to affect the legality, validity or enforceability of the Plan,
the Rate Agreement, the Merger Agreement, any Loan Document or any
Significant Contract in effect or (ii) materially adversely affect the
financial condition, properties, prospects or operations of the Borrower as a
whole.
(g) On and after the Funding Date, all insurance
required by Section 7.01(c) hereof will be in full force and effect.
<PAGE>
48
(h) No ERISA Plan Termination Event has occurred nor
is reasonably expected to occur with respect to any ERISA Plan which would
materially adversely affect the financial condition, properties, prospects or
operations of the Borrower, except as disclosed to and consented by the
Majority Lenders in writing. Since the date of the most recent Schedule B
(Actuarial Information) to the annual report of the Borrower (Form 5500
Series), if any, there has been no material adverse change in the funding
status of the ERISA Plans referred to therein and no "prohibited transaction"
has occurred with respect thereto, except as described in the Form S-1.
Neither the Borrower nor any of its ERISA Affiliates has incurred nor
reasonably expects to incur any material withdrawal liability under ERISA to
any ERISA Multiemployer Plan, except as disclosed to and consented by the
Majority Lenders in writing.
(i) The Major Electric Generating Plants are on land
in which the Borrower owns a full or an undivided fee interest subject only
to Liens permitted by Section 7.02(a) hereof, which do not materially impair
the usefulness to the Borrower of such properties; the electric transmission
and distribution lines of the Borrower in the main are located in New
Hampshire and on land owned in fee by the Borrower or over which the Borrower
has easements, or are in or over public highways or public waters pursuant to
adequate statutory or regulatory authority, and any defects in the title to
such transmission and distribution lands or easements are in the main curable
by the exercise of the Borrower's right of eminent domain upon a finding that
such eminent domain proceedings are necessary to meet the reasonable
requirements of service to the public; the Borrower enjoys peaceful and
undisturbed possession under all of the leases under which it is operating,
none of which contains any unusual or burdensome provision which will
materially affect or impair the operation of the Borrower; and the Security
Documents, when duly executed and delivered, will create valid Liens in the
Collateral, subject only to Liens permitted by Section 7.02(a) hereof, and,
on and after the Funding Date, all filings and other actions necessary to
perfect and protect such security interests (to the extent such security
interests may be perfected or protected by filing) will have been taken.
(j) No material part of the properties, business or
operations of the Borrower are materially adversely affected by any fire,
explosion, accident, strike, lockout or other labor disputes, drought, storm,
hail, earthquake, embargo, act of God or of the public enemy or other
casualty (except for any such circumstance, if any, which is covered by
insurance which coverage has been confirmed and not disputed by the relevant
insurer or by fully-funded self-insurance programs).
(k) The Borrower has filed all tax returns (Federal,
state and local) required to be filed and paid taxes shown thereon to be due,
including interest and penalties, or, to the extent the Borrower is
contesting in good faith an assertion of liability based on such returns, has
provided adequate reserves in accordance with generally accepted accounting
principles for payment thereof.
(l) No exhibit, schedule, report or other written
information provided by the Borrower or its agents to the Lenders in
connection with the negotiation, execution and closing of this Agreement
(including, without limitation, the Information Memorandum) knowingly
contained when made any material misstatement of fact or knowingly omitted to
state any material fact necessary to make the statements contained therein
not misleading in light of the circumstances under which they were made.
<PAGE>
49
(m) No event has occurred and is continuing which
constitutes a material default under the Rate Agreement, the Merger Agreement
or any Significant Contract which is in effect.
(n) All proceeds of the Advances shall be used for
general working capital, including, without limitation, payment of any
transaction expenses relating to the Plan and the Merger, and for the
acquisition of an additional ownership interest in Seabrook from the Vermont
Electric Generation and Transmission Cooperative, Inc. No proceeds of any
Advance will be used (i) to acquire any equity security of a class which is
registered pursuant to Section 12 of the Securities Exchange Act of 1934 or
(ii) to buy or carry any margin stock (within the meaning of Regulation U
issued by the Board of Governors of the Federal Reserve System) or to extend
credit to others for such purpose. The Borrower (i) is not an "investment
company" within the meaning ascribed to that term in the Investment Company
Act of 1940 or (ii) is not engaged in the business of extending credit for
the purpose of buying or carrying margin stock.
ARTICLE VII
COVENANTS OF THE BORROWER
SECTION 01. Affirmative Covenants. On and after the
Funding Date, so long as 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:
(a) Use of Proceeds. Apply all proceeds of each
Advance solely as specified in Section 6.01(n) hereof.
(b) Payment of Taxes, Etc. Pay and discharge before
the same shall become delinquent, all taxes, assessments and governmental
charges, royalties or levies imposed upon it or upon its property except to
the extent the Borrower is contesting the same in good faith by appropriate
proceedings and has set aside adequate reserves for the payment thereof.
(c) Maintenance of Insurance. Maintain, or cause to
be maintained, insurance (including appropriate plans of self-insurance)
covering the Borrower and its properties in effect at all times in such
amounts and covering such risks as may be required by law and in addition as
is usually carried by companies engaged in similar businesses and owning
similar properties.
(d) Preservation of Existence, Etc. Preserve and
maintain its corporate existence, material rights (statutory and otherwise)
and franchises except as otherwise expressly provided in the Plan or in the
Security Documents.
(e) Compliance with Laws, Etc.. Comply in all
material respects with the requirements of all applicable laws, rules,
regulations and orders of any governmental authority, including without
limitation any such laws, rules, regulations and orders relating to
utilities, zoning, environmental protection, use and disposal of Hazardous
Substances, land use, construction and building restrictions, and employee
safety and health matters relating to business operations, except to the
extent (i) that the Borrower is contesting the same in good faith by
<PAGE>
50
appropriate proceedings or (ii) that any such non-compliance, and the
enforcement or correction thereof, would not materially adversely affect the
financial condition, properties, prospects or operations of the Borrower as a
whole.
(f) Inspection Rights. At any time and from time to
time upon reasonable notice, permit the Administrative Agent and its agents
and representatives to examine and make copies of and abstracts from the
records and books of account of, and the properties of, the Borrower and to
discuss the affairs, finances and accounts of the Borrower with the Borrower
and of its officers, directors and accountants.
(g) Keeping of Books. Keep proper records and books
of account, in which full and correct entries shall be made of all financial
transactions of the Borrower and the assets and business of the Borrower, in
accordance with good accounting practices consistently applied.
(h) Performance of Related Agreements.
(i) From and after the effective date of the Rate
Agreement, the Merger Agreement and each Significant
Contract, (A) perform and observe all material terms
and provisions of such agreements to be performed or
observed by the Borrower and (B) take all reasonable
steps to enforce such agreements substantially in
accordance with their terms and to preserve the rights
of the Borrower thereunder; provided, that the
foregoing provisions of this Section 7.01(h) shall not
preclude the Borrower from any waiver, amendment,
modification, consent or termination permitted under
Section 7.02(h) hereof.
(ii) Upon any termination of the Merger Agreement,
cause NUSCO to continue its obligations under the
Management Services Agreement pursuant to
Section 7(b)(i) thereof until the earlier of
(A) 45 days after written notice from the Borrower to
the Administrative Agent of the Borrower's intention to
terminate such arrangement or (B) expiration of the
six-month period specified in said Section 7(b)(i).
(i) Collection of Accounts Receivable. Promptly bill,
and diligently pursue collection of, in accordance with customary utility
practices, all accounts receivable owing to the Borrower and all other
amounts that may from time to time be owing to the Borrower for services
rendered or goods sold.
(j) Maintenance of Financial Covenants.
(i) Operating Income to Interest Expense.
Maintain, for each period of four consecutive fiscal
quarters ending on the dates set forth below, a ratio
of Operating Income to Interest Expense not less than
the respective ratio specified below:
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51
Period of Four Fiscal
Quarters Ending on the
Following Dates: Ratio
June 30, 1992 1.30:1
September 30, 1992 1.30:1
December 31, 1992 1.40:1
March 31, 1993 1.40:1
June 30, 1993 1.40:1
September 30, 1993 1.40:1
December 31, 1993 1.50:1
March 31, 1994 1.50:1
Termination Date 1.50:1
(ii) Common Equity to Total Capitalization.
Maintain at all times a ratio of Common Equity to Total
Capitalization of not less than the respective ratio
specified below:
Prior to the Merger Effective Date:
Period Ratio
Funding Date through and 0.26:1
including December 31, 1991
January 1, 1992 through and 0.28:1
and including September 30,
1993
October 1, 1993 through and 0.30:1
including the Termination
Date
On and After the Merger Effective Date:
Period Ratio
Funding Date through and 0.20:1
including June 30, 1993
July 1, 1993 through and 0.21:1
including the Termination
Date
(k) Maintenance of Properties, Etc. (i) As to
properties of the type described in Section 6.01(i), maintain title of the
quality described therein; and (ii) preserve, maintain, develop, and operate
in substantial conformity with all laws, material contractual obligations and
prudent practices prevailing in the industry, all of its properties which are
used or useful in the conduct of its business in good working order and
condition, ordinary wear and tear excepted, except to the extent such non-
conformity would not materially adversely affect the financial condition,
properties, prospects or operations of the Borrower as a whole.
(l) Governmental Approvals. Duly obtain on or prior
to such date as the same may become legally required, and thereafter maintain
in effect at all times, all Governmental Approvals on its part to be
<PAGE>
52
obtained, except those the absence of which would not materially adversely
affect the financial condition, properties, prospects or operations of the
Borrower as a whole.
(m) Further Assurances. Promptly execute and deliver
all further instruments and documents, and take all further action, that may
be necessary or that any Lender through the Administrative Agent may
reasonably request in order to fully give effect to the interests and
properties purported to be covered by the Security Documents.
SECTION 02. Negative Covenants. On and after the
Funding Date, and so long as 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:
(a) Liens, Etc. Create, incur, assume or suffer to
exist any lien, security interest, or other charge or encumbrance (including
the lien or retained security title of a conditional vendor) of any kind, or
any other type of preferential arrangement the intent or effect of which is
to assure a creditor against loss or to prefer one creditor over another
creditor (other than any preferential arrangement under the Joint Ownership
Agreement with respect to any party thereto) upon or with respect to any of
its properties of any character (any of the foregoing being referred to
herein as a "Lien") whether now owned or hereafter acquired, or sign or file
under the Uniform Commercial Code of any jurisdiction a financing statement
which names the Borrower as debtor, sign any security agreement authorizing
any secured party thereunder to file such financing statement, or assign
accounts, excluding, however, from the operation of the foregoing
restrictions the Liens created or perfected under the Loan Documents and the
following, whether now existing or hereafter created or perfected:
(i) Liens on property specifically reserved,
excepted and excluded by subparagraphs (c) through
(g) and subparagraph (j) following the Granting
Clauses section of the First Mortgage Indenture;
(ii) Permitted Encumbrances (as defined in
the PSNH Mortgage) on the Indenture Assets (except
Liens referred to in paragraphs (s) and (t) of
Schedule C to the PSNH Mortgage hereafter directly
created by the Borrower, provided, however, that
the Borrower may create any such Lien with the
consent of the Majority Lenders if such Lien would
not materially adversely affect the security
granted under the PSNH Mortgage, as determined by
the Majority Lenders in their reasonable
discretion), provided that in no event shall the
outstanding principal amount of the First Mortgage
Bonds exceed at any time the First Mortgage Bond
Amount;
(iii) Permitted Encumbrances (as defined
in the Seabrook Mortgage) on the Seabrook
Indenture Assets (except Liens referred to in
paragraphs (s) and (t) of Schedule C to the
Seabrook Mortgage hereafter created, incurred or
assumed by the Borrower, provided, however, that
the Borrower may create any such Lien with the
<PAGE>
53
consent of the Majority Lenders if such Lien would
not materially adversely affect the security
granted under the Seabrook Mortgage, as determined
by the Majority Lenders in their reasonable
discretion);
(iv) Liens referred to in paragraphs (b)
through (t) of Schedule C to the PSNH Mortgage on
realty or personalty that is subject to the Lien
of the First Mortgage Indenture but is not also
subject to the Lien of the PSNH Mortgage and,
prior to the transfer of such interest to NAEC on
the Merger Effective Date, Liens on the
undeveloped land adjacent to Seabrook wholly-
owned by the Borrower and described as the
"Adjacent Property" in Schedule D to the PSNH
Mortgage; provided, however, that the aggregate
principal amount of the Debt at any one time
outstanding secured by purchase money Liens
permitted by paragraph (m) of Schedule C to the
PSNH Mortgage and the Seabrook Mortgage including
Liens of a conditional vendor that are the
functional equivalent of purchase money Liens,
shall not exceed $20,000,000; and
(v) Liens created or perfected under or in
connection with the Pledge Agreement (as defined
in each of the Series D Reimbursement Agreement
and the Series E Reimbursement Agreement).
(b) Debt. Create, incur or assume any Debt unless,
after giving effect thereto, (i) no Event of Default or Unmatured Default
shall have occurred and be continuing on the date of such creation,
incurrence or assumption (determined, in the case of Section 7.01(j)(i) as
though such Debt were created, incurred or assumed as of the first day of the
immediately preceding fiscal quarter and using the Borrower's most recent
annual actuarial determinations in the computation of Debt referred to in
clause (ix) in the definition of "Debt") and (ii) the Borrower shall have
determined that, on the basis of the assumptions and forecasts set forth in
the most recent operating budget/forecast of operations delivered pursuant to
Section 7.03(iv) hereof (which the Borrower continues to believe to be
reasonable), the Borrower will continue to be in compliance at all times with
the provisions of Section 7.01(j) hereof. The Borrower will furnish evidence
of its compliance with this subsection (b) for each fiscal quarter pursuant
to Section 7.03(ii) hereof.
(c) Mergers, Etc. Merge with or into or consolidate
with or into, or acquire all or substantially all of the assets of, any
Person; provided that the Merger shall be permitted if, on the Merger
Effective Date, the Lenders shall have received (i) a certificate signed by
the Chief Financial Officer, Treasurer or Assistant Treasurer of the Borrower
certifying that the Merger Pro-formas attached thereto were updated through
the Merger Effective Date to reflect any changes in the Merger Pro-formas
delivered to the Lenders pursuant to Section 5.01(a)(v) hereof and such pro-
formas were prepared in good faith and on reasonable assumptions and
(ii) true and complete copies of the Sharing Agreement, the Tax Allocation
Agreement and the Unit Contract, in each case duly executed by the parties
thereto together with (A) a certificate of a duly authorized officer of the
<PAGE>
54
Borrower, reaffirming the representations and warranties set forth in
Sections 6.01(b), (c) and (d) hereof in so far as they relate to the Sharing
Agreement, the Tax Allocation Agreement and the Unit Contract, and (B) an
opinion of Day, Berry & Howard as to the legality, validity, binding effect
and enforceability of such agreements, in each case, in form and substance
satisfactory to the Majority Lenders.
(d) Sales, Etc., of Assets. Sell, lease, transfer or
otherwise dispose of all or any substantial part of its assets (whether in a
single transaction or series of transactions during any consecutive 12-month
period) other than in the ordinary course of the Borrower's business in
accordance with ordinary and customary terms and conditions and other than
the Seabrook Transfer contemplated pursuant to the Merger as permitted under
Section 7.02(c) hereof.
For purposes of this subsection (d):
(i) all sales, leases, transfers or dispositions
of receivables of the Borrower to any unaffiliated
third party, except for collection in the ordinary
course of the Borrower's business of delinquent
accounts, shall be deemed to be substantial and outside
of the ordinary course of the Borrower's business; and
(ii) any transaction or series of transactions
during any consecutive 12-month period shall be deemed
to involve a "substantial part" of the Borrower's
assets if, in the aggregate, (A) the value of such
assets equals or exceeds 10% of the total assets of the
Borrower reflected in the financial statements of the
Borrower delivered pursuant to Section 7.03(ii) or
7.03(iii) hereof in respect of the fiscal quarter or
year ending on or immediately prior to the commencement
of such 12-month period or (B) for the four calendar
quarters ending on or immediately prior to commencement
of such 12-month period, the gross revenue derived by
the Borrower from such assets shall equal or exceed 10%
of the total gross revenue of the Borrower.
(e) Investments in Other Persons. Make any loan or
advance to any Person or purchase or otherwise acquire any capital stock,
obligations or other securities of, make any capital contribution to, or
otherwise invest in, any Person other than Permitted Investments and loans,
advances, purchases and investments listed on Schedule III hereto.
(f) Restricted Payments. Declare or pay any dividend,
or make any payment or other distribution of assets, properties, cash,
rights, obligations or securities on account of any share of any class of
capital stock of the Borrower (other than stock splits and dividends payable
solely in equity securities of the Borrower), or purchase, redeem, retire, or
otherwise acquire for value any shares of any class of capital stock of the
Borrower or any warrants, rights, or options to acquire any such Debt or
shares, now or hereafter outstanding, or make any distribution of assets to
any of its shareholders (any such transaction being a "Restricted Payment")
except for Restricted Payments made in compliance with the following
conditions:
<PAGE>
55
(i) The Borrower may not make any Restricted
Payments if an Event of Default or Unmatured Default
shall have occurred and be continuing.
(ii) The Borrower may not make any Restricted
Payments during any fiscal quarter if, after giving
effect thereto (and to the other computations set forth
below in this clause (ii)), the Borrower would not be
in full compliance with Section 7.01(j) hereof. For
purposes of determining compliance with said
Section 7.01(j) under this clause (ii):
(A) computations under Section 7.01(j)(i)
shall be made as of the end of the fiscal quarter
immediately preceding the current fiscal quarter
in which such Restricted Payment is to be made;
and
(B) computations under Section 7.01(j)(ii)
shall be made as of the date of such Restricted
Payment, except that, retained earnings shall be
determined as of the last day of the immediately
preceding fiscal quarter (adjusted for all
Restricted Payments made after the last day of
such preceding fiscal quarter).
(iii) The Borrower may not make any Restricted
Payments unless, after giving effect thereto, the
Borrower shall have determined that, on the basis of
the assumptions and forecasts set forth in the most
recent operating budget/forecast of operations
delivered pursuant to Section 7.03(iv) hereof (which
the Borrower continues to believe to be reasonable) the
Borrower will continue to be in compliance at all times
with the provisions of Section 7.01(j) hereof.
(iv) On or prior to the second anniversary of
the Funding Date, the Borrower may make no Restricted
Payments except out of that portion of earned surplus
accumulated after the Funding Date in excess of
$75,000,000 (determined in accordance with generally
accepted accounting principles and without giving
effect to charges to earned surplus on account of
Restricted Payments or on account of transfers from
earned surplus to capital surplus or capital stock
accounts).
Notwithstanding anything contrary contained in this Section 7.02(f), the
Borrower may (x) declare and pay regularly scheduled quarterly dividends on
the Preferred Stock and declare and pay into escrow on, or within 30 days
after, the Funding Date, with respect to the first two dividend periods
following the Funding Date all or any part of the dividends scheduled to
accrue during such periods if, immediately prior to and after giving effect
to any such payment, no Event of Default or Unmatured Default relating to the
payment of principal, interest or fees under this Agreement or the other
Financing Agreement shall have occurred and be continuing, (y) declare and
pay into escrow, prior to the date required to be paid to holders of
Preferred Stock, with respect to the fifth and sixth dividend periods
<PAGE>
56
following the Funding Date all or any part of the dividends scheduled to
accrue during such periods, if, immediately prior to and after giving effect
to any such payment, no Event of Default or Unmatured Default shall have
occurred and be continuing and (z) make any payments on account of its common
stock required to be made pursuant to the Merger Agreement in connection with
consummation of the Merger in accordance with Section 7.02(c) hereof.
(g) Compliance with ERISA. (i) Terminate, or permit
any ERISA Affiliate to terminate, any ERISA Plan so as to result in any
material (in the opinion of the Majority Lenders) liability of the Borrower
to the PBGC, or (ii) permit to exist any occurrence of any Reportable Event
(as defined in Title IV 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 ERISA Plan and such a material liability to
the Borrower.
(h) Related Agreements.
(i) Amendments. Amend, modify or supplement or
give any consent, acceptance or approval to any
amendment, modification or supplement or deviation by
any party from the terms of, the Rate Agreement, the
Merger Agreement or any Significant Contract, except,
with respect only to the Merger Agreement and the
Significant Contracts, any amendment, modification or
supplement to such agreement that would not reduce the
rights or entitlements of the Borrower thereunder in
any material way.
(ii) Termination. Cancel or terminate (or consent
to any cancellation or termination of) the Rate
Agreement, the Merger Agreement or any Significant
Contract prior to the expiration of its stated term,
provided that this subsection (ii) shall not restrict
the rights of the Borrower to reject a request by NU to
the Borrower to extend the Termination Date (as defined
in the Merger Agreement) of the Merger Agreement
pursuant to Section 10.3(b) of the Merger Agreement or
to otherwise enforce any remedy against any obligor
under the Merger Agreement or any Significant Contract
in the event of a material breach or default by such
obligor thereunder if and so long as the Borrower shall
have provided to the Administrative Agent at least
30 days prior written notice of the enforcement action
proposed to be undertaken by the Borrower.
(i) Change in Nature of Business. Engage in any
material business activity other than those established and engaged in on the
date hereof or described in the Third Amended Disclosure Statement of NU,
dated December 28, 1989 and filed with the Bankruptcy Court.
(j) Ownership in Seabrook and Nuclear Plants.
(i) acquire, directly or indirectly, any
additional ownership interest in Seabrook, or any
ownership interest or any additional ownership interest
of any kind in any other nuclear-powered electric
generating plant, except such additional ownership
<PAGE>
57
interest in Seabrook (A) as may be acquired from the
Vermont Electric Generation and Transmission
Cooperative, Inc. or (B) as the Borrower may be
required to acquire pursuant to the terms of the Joint
Ownership Agreement, provided, however, that, prior to
acquiring any such additional ownership interest in
Seabrook referred to in clause (B), the Borrower shall
deliver to the Administrative Agent a written opinion
of counsel (in form and substance satisfactory to the
Majority Lenders) to the effect that any such
additional ownership interest will be included in the
"Ownership Share" (as defined in the Unit Contract) and
that any payments referred to in Section B.(E)(1) and
(2) of Exhibit C to the Rate Agreement would reflect
the Ownership Share as increased by such additional
ownership interest; or
(ii) amend, modify or supplement, or give any
consent, acceptance or approval to any amendment,
modification or supplementation to, the Joint Ownership
Agreement which would (A) cause the Borrower to acquire
any additional ownership interest in Seabrook, except
as permitted under clause (i) above, or (B) increase
the obligations of the Borrower thereunder without
increasing ratably the obligations of the other parties
thereto.
(k) Subsidiaries. Create or suffer to exist any
active subsidiaries other than Properties, Inc., a New Hampshire corporation;
or permit any material assets or business to be maintained at or conducted by
any subsidiary except for the assets owned by Properties, Inc. not exceeding
$20,000,000.
SECTION 03. Reporting Obligations. So long as 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, furnish to the Administrative Agent in sufficient copies for each
Lender, the following:
(i) as soon as possible and in any event
within five (5) days after the occurrence of each
Event of Default or Unmatured Default continuing
on the date of such statement, a statement of the
Chief Financial Officer, Treasurer or Assistant
Treasurer of the Borrower setting forth details of
such Event of Default or Unmatured Default and the
action which the Borrower proposes to take with
respect thereto;
(ii) as soon as available and in any event
within fifty (50) days after the end of each of
the first three quarters of each fiscal year of
the Borrower, (A) if and so long as the Borrower
is required to submit to the Securities and
Exchange Commission a report on Form 10-Q, a copy
of the Borrower's report on Form 10-Q submitted to
the Securities and Exchange Commission with
respect to such quarter and (B) if the Borrower
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58
ceases to be required to submit such report, a
balance sheet of the Borrower as of the end of
such quarter and statements of income and retained
earnings and of cash flows of the Borrower 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 (subject to year-end audit adjustments)
by the Chief Financial Officer, Treasurer or
Assistant Treasurer of the Borrower as having been
prepared in accordance with generally accepted
accounting principles consistent with those
applied in the preparation of the financial
statements referred to in Section 6.01(e) hereof,
in each such case, delivered together with a
certificate of said officer (1) 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 proposes to take with
respect thereto and (2) (y) demonstrating
compliance with Section 7.01(j) for and as of the
end of such fiscal quarter and compliance with
Sections 7.02(b) and (f), as of the dates on which
any Debt was created, incurred or assumed (using
the Borrower's most recent annual actuarial
determinations in the computation of Debt referred
to in clause (ix) in the definition of "Debt") or
any Restricted Payment was made during such
quarter, and (z) demonstrating, after giving
effect to the incurrence of any Debt created,
incurred or assumed during such fiscal quarter
(using the Borrower's most recent annual actuarial
determinations in the computation of Debt referred
to in clause (ix) in the definition of "Debt") and
after giving effect to any Restricted Payment made
during such fiscal quarter, compliance with
Section 7.01(j) for the remainder of the fiscal
year of the Borrower based on the operating
budget/forecast of operations delivered pursuant
to Section 7.03(iv) hereof for such fiscal year,
in each case, such demonstration to be in a
schedule (in form satisfactory to the Majority
Lenders) which sets forth the computations used by
the Borrower in determining such compliance;
(iii) as soon as available and in any
event within 105 days after the end of each fiscal
year of the Borrower, (A) if and so long as the
Borrower is required to submit to the Securities
and Exchange Commission a report on Form 10-K, a
copy of the Borrower's report on Form 10-K
submitted to the Securities and Exchange
Commission with respect to such year and (B) if
the Borrower ceases to be required to submit such
report, a copy of the annual audit report for such
year for the Borrower including therein a balance
<PAGE>
59
sheet of the Borrower as of the end of such fiscal
year and statements of income and retained
earnings and of cash flows of the Borrower for
such fiscal year, in each case certified by a
nationally-recognized independent public
accountant, in each such case delivered together
with a certificate of the Chief Financial Officer,
Treasurer or Assistant Treasurer (A) (1) stating
that the financial statements were prepared in
accordance with generally accepted accounting
principles consistent with those applied in the
preparation of financial statements referred to in
Section 6.01(e) hereto, and (2) 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 proposes to take with respect
thereto and (B) demonstrating compliance with
Section 7.01(j) for and as of the end of such
fiscal year and compliance with Sections 7.02(b)
and (f), as of the dates on which any Debt was
created, incurred or assumed (using the Borrower's
most recent annual actuarial determinations in the
computation of Debt referred to in clause (ix) in
the definition of "Debt") or any Restricted
Payment was made during the last fiscal quarter of
the Borrower, in each case, such demonstration to
be in a schedule (in form satisfactory to the
Majority Lenders) which sets forth the
computations used by the Borrower in determining
such compliance.
(iv) as soon as available and in any event
within (A) 60 days prior to the end of each fiscal
year of the Borrower if prior to the Merger
Effective Date or (B) March 31 of each fiscal year
commencing on or after the Merger Effective Date,
a copy of an operating budget/forecast of
operations of the Borrower as approved by the
Board of Directors of the Borrower in form
satisfactory to the Lenders for the next fiscal
year of the Borrower, together with a certificate
of the Chief Financial Officer, Treasurer or
Assistant Treasurer of the Borrower stating that
such budget/forecast was prepared in good faith
and on reasonable assumptions;
(v) as soon as available and in any event no
later than the New Hampshire Public Utilities
Commission shall have received the Borrower's
annual submission, if any, relating to the "return
on equity collar" referred to in the Rate
Agreement, a copy of such annual submission of the
Borrower;
(vi) as soon as possible and in any event
(A) within 30 days after the Borrower knows or has
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60
reason to know that any ERISA Plan Termination
Event described in clause (i) of the definition of
ERISA Plan Termination Event with respect to any
ERISA Plan or ERISA Multiemployer Plan has
occurred and (B) within 10 days after the Borrower
knows or has reason to know that any other ERISA
Plan Termination Event with respect to any ERISA
Plan or ERISA Multiemployer Plan has occurred, a
statement of the Chief Financial Officer,
Treasurer or Assistant Treasurer of the Borrower
describing such ERISA Plan Termination Event and
the action, if any, which the Borrower proposes to
take with respect thereto;
(vii) 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 any such ERISA Affiliate of the PBGC's
intention to terminate any ERISA Plan or ERISA
Multiemployer Plan or to have a trustee appointed
to administer any ERISA Plan or ERISA
Multiemployer Plan;
(viii) promptly and in any event within 30
days after the filing thereof with the Internal
Revenue Service, copies of each Schedule B
(Actuarial Information) to the annual report (Form
5500 Series) with respect to each ERISA Plan (if
any) to which the Borrower is a contributing
employer;
(ix) promptly after receipt thereof by
the Borrower or any of its ERISA Affiliates from
an ERISA Multiemployer Plan sponsor, a copy of
each notice received by the Borrower or any of its
ERISA Affiliates concerning the imposition or
amount of withdrawal liability in an aggregate
principal amount of at least $10,000,000 pursuant
to Section 4202 of ERISA in respect of which the
Borrower may be liable;
(x) 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 6.01(f), or
(B) which purport to affect the legality, validity
or enforceability of any of the Loan Documents or
Significant Contracts;
(xi) promptly after the sending or filing
thereof, copies of all such proxy statements,
financial statements, and reports which the
Borrower sends to its public security holders (if
any) or files with, and copies of all regular,
periodic and special reports and all registration
statements and periodic or special reports, if
any, which the Borrower files with, the Securities
and Exchange Commission or any governmental
<PAGE>
61
authority which may be substituted therefor, or
with any national securities exchange;
(xii) promptly after receipt thereof, any
assertion of the character described in Section
8.01(h) hereof and the action the Borrower
proposes to take with respect thereto;
(xiii) promptly after knowledge of any
material default under the Rate Agreement, the
Merger Agreement or any Significant Contract,
notice of such default and the action the Borrower
proposes to take with respect thereto;
(xiv) promptly after knowledge of any
amendment, modification, or other change to the
Rate Agreement, Merger Agreement or any
Significant Contract or to any Governmental
Approval affecting the Rate Agreement, notice of
such amendment, modification or other change, it
being understood that for purposes of this clause
(xiv) any filing by the Borrower in the ordinary
course of the Borrower's business with, or order
issued or action taken by, a governmental
authority or regulatory body after the Plan
Effective Date to implement the terms of the Rate
Agreement shall not be considered an amendment,
modification or change to a Governmental Approval
affecting the Rate Agreement; and
(xv) promptly after requested, such other
information respecting the financial condition,
operations, properties, prospects or otherwise, of
the Borrower as the Administrative Agent or
Majority Lenders may from time to time reasonably
request in writing.
ARTICLE VIII
DEFAULTS
SECTION 01. Events of Default. The following events
shall each constitute an "Event of Default" if the same shall occur and be
continuing after the grace period and notice requirement (if any) applicable
thereto:
(a) The Borrower shall fail to pay any principal of
any Note or any fees when due or shall fail to pay any interest on any Note
within two days after the same becomes due;
(b) Any representation or warranty made by the
Borrower or NU (or any of their officers or agents) in this Agreement, any
other Loan Document, certificate or other writing delivered pursuant hereto
or thereto shall prove to have been incorrect in any material respect when
made or deemed made; or
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62
(c) The Borrower shall fail to perform or observe any
term or covenant on its part to be performed or observed contained in
Sections 7.01(a), (d) or (j), Section 7.02 or Section 7.03(i) hereof; or
(d) On and after the Funding Date, the Borrower shall
fail to perform or observe any other term or covenant on its part to be
performed or observed contained in this Agreement or any Loan Document and
any such failure shall remain unremedied, after written notice thereof shall
have been given to the Borrower by the Administrative Agent or any Lender,
for a period of 30 days; or
(e) On and after the Funding Date, the Borrower shall
fail to pay any of its Debt when due (including any interest or premium
thereon but excluding Debt evidenced by the Notes and excluding other Debt
aggregating in no event more than $10,000,000 in principal amount at any one
time) whether by scheduled maturity, required prepayment, acceleration,
demand or otherwise, and such failure shall continue after the applicable
grace period, if any, specified in any agreement or instrument relating to
such Debt; or any other default under any agreement or instrument relating to
any such Debt, or any other event, shall occur and shall continue after the
applicable grace period, if any, specified in such agreement or instrument,
if the effect of such default or event is to accelerate, or to permit the
acceleration of, the maturity of such Debt; or any such Debt shall be
declared to be due and payable, or required to be prepaid (other than by a
regularly scheduled required prepayment or as a result of the Borrower's
exercise of a prepayment option) prior to the stated maturity thereof; unless
in each such case the obligee under or holder of such Debt or the trustee
with respect to such Debt shall have waived in writing such circumstance
without consideration having been paid by the Borrower so that such
circumstance is no longer continuing; or
(f) On and after the Funding Date, 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 an 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 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, or
other similar official for it or for any substantial part of its property
and, in the case of a proceeding instituted against the Borrower, either the
Borrower shall consent thereto or such proceeding shall remain undismissed or
unstayed for a period of 90 days or any of the actions sought in such
proceeding (including without limitation the entry of an order for relief
against the Borrower or the appointment of a receiver, trustee, custodian or
other similar official for the Borrower or any of its property) shall occur;
or the Borrower shall take any corporate or other action to authorize any of
the actions set forth above in this subsection (f); or
(g) On and after the Funding Date, any judgment or
order for the payment of money in excess of $10,000,000 shall be rendered
against the Borrower or its properties and either (i) enforcement proceedings
shall have been commenced by any creditor upon such judgment or order and
shall not have been stayed or (ii) there shall be any period of 15
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
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(h) Any material provision of any Loan Document, the
Rate Agreement or any Significant Contract, after execution hereof or
delivery thereof under Article V and Section 7.02(c) hereof, shall for any
reason other than the express terms thereof or the exercise of any right or
option expressly contained therein cease to be valid and binding on any party
thereto except as otherwise expressly permitted by the exceptions and
provisos contained in Section 7.02(h) hereof; or any party thereto other than
the Lenders shall so assert in writing, provided that in the case of any
party other than the Borrower making such assertion in respect of the Rate
Agreement or any Significant Contract, such assertion shall not in and of
itself constitute an Event of Default hereunder until (i) such asserting
party shall cease to perform under and in compliance with the Rate Agreement
or such Significant Contract, (ii) the Borrower shall fail to diligently
prosecute, by appropriate action or proceedings, a rescission of such
assertion or a binding determination as to the merits thereof or (iii) such a
binding determination shall have been made in favor of such asserting party's
position; or
(i) The Security Documents after delivery under
Article V hereof shall for any reason, except to the extent permitted by the
terms thereof, fail or cease to create valid and perfected Liens (to the
extent purported to be granted by such documents and subject to the
exceptions permitted thereunder) in any of the Collateral, provided, that
such failure or cessation relating to any non-material portion of such
Collateral shall not constitute an Event of Default hereunder unless the same
shall not have been corrected within 30 days after the Borrower becomes aware
thereof; or
(j) The Borrower shall not have in full force and
effect any or all insurance required under Section 7.01(c) hereof or there
shall be incurred any uninsured damage, loss or destruction of or to the
Borrower's properties in an amount not covered by insurance (including fully-
funded self-insurance programs) which the Majority Lenders consider to be
material; or
(k) A default by the Borrower shall have occurred
under the Rate Agreement and shall not have been effectively cured within the
time period specified therein for such cure (or, if no such time period is
specified therein, 10 days); or, a default by the Borrower shall have
occurred under the Merger Agreement, or a default by any party shall have
occurred under any Significant Contract and, in either such case, such
default shall not have been effectively cured within 30 days after notice
from the Administrative Agent to the Borrower stating that, in the opinion of
the Majority Lenders, such default may have a material adverse effect upon
the financial condition, operations, properties or prospects of the Borrower
as a whole; or
(l) Any Governmental Approval (whether federal, state
or local) required to give effect to the Rate Agreement (including, without
limitation, Chapter 362-C of the New Hampshire Revised Statutes and the
enabling order of The New Hampshire Public Utilities Commission issued
pursuant thereto) shall be amended, modified or supplemented, or any other
regulatory or legislative action or change (whether federal, state or local)
having the effect, directly or indirectly, of modifying the benefits or
entitlements of the Borrower under the Rate Agreement shall occur, and in any
such case such amendment, modification, supplement, action or change may
have, in the opinion of the Majority Lenders, a material adverse effect upon
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64
the financial condition, operations, properties or prospects of the Borrower
as a whole; or
(m) On and after the Merger Effective Date, NU shall
cease to own all of the outstanding common stock of the Borrower, free and
clear of any Liens.
SECTION 02. Remedies Upon Events of Default. Upon the
occurrence and during the continuance of any Event of Default, then, and in
any such event, the Administrative Agent shall at the request, or may with
the consent, of the Majority Lenders, upon notice to the Borrower (i) declare
the Commitments and the obligation of each Lender to make Advances to be
terminated, provided, that any such request or consent shall be made solely
by the Lenders having Percentages in the aggregate of not less 66-2/3%,
whereupon the same shall forthwith terminate, (ii) declare the Notes, all
interest thereon and all other amounts payable under this Agreement and the
Security Documents to be forthwith due and payable, provided, that any such
request or consent shall be made solely by the Lenders holding at least
66-2/3% of the then aggregate unpaid principal amount of the Advances owing
to the Lenders, 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, and (iii) exercise in respect of any and all
collateral, in addition to the other rights and remedies provided for herein
and in the Security Documents or otherwise available to the Administrative
Agent, the Collateral Agent or the Lenders, all the rights and remedies of a
secured party on default under the Uniform Commercial Code in effect in the
State of New York and in effect in any other jurisdiction in which Collateral
is located at that time; 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.
ARTICLE IX
THE ADMINISTRATIVE AGENT
SECTION 01. Authorization and Action. Each Lender
hereby (i) appoints and authorizes the Administrative Agent to take such
action as agent on its behalf and to exercise such powers under this
Agreement as are delegated to the Administrative Agent by the terms hereof,
together with such powers as are reasonably incidental thereto and (ii)
agrees that, except as otherwise expressly provided herein, Bankers Trust,
Chemical and Citibank, as Co-Agents, shall have no duties or obligations
hereunder. As to any matters not expressly provided for by any Loan Document
(including, without limitation, enforcement or collection thereof), the
Administrative Agent shall not be required to exercise any discretion or take
any action, but shall be required to act or to refrain from acting (and
shall be fully protected in so acting or refraining from acting) upon the
instructions of the Majority Lenders, and such instructions shall be binding
upon all Lenders; provided, however, that the Administrative Agent shall not
be required to take any action which exposes the Administrative Agent to
personal liability or which is contrary to this Agreement or applicable law.
The Administrative Agent agrees to deliver promptly to each Lender notice of
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65
each notice given to it by the Borrower pursuant to the terms of this
Agreement.
SECTION 02. Administrative Agent's Reliance, Etc..
Neither the Administrative Agent nor any of its directors, officers, agents
or employees shall be liable for any action taken or omitted to be taken by
it or them under or in connection with any Loan Document, except for its or
their own gross negligence or wilful misconduct. Without limitation of the
generality of the foregoing, the Administrative Agent: (i) may treat the
payee of any Note as the holder thereof until the Administrative Agent
receives and accepts a Lender Assignment entered into by the Lender which is
the payee of such Note, as assignor, and an assignee, as provided in Section
10.07; (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 the Information Memorandum or any other
statements, warranties or representations made in or in connection with any
Loan Document; (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
any Loan Document on the part of the Borrower to be performed or observed, or
to inspect any 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 any Loan
Document, Significant Contract or any other instrument or document furnished
pursuant hereto; and (vi) shall incur no liability under or in respect of any
Loan Document by acting upon any notice, consent, certificate or other
instrument or writing (which may be by telegram, cable or telex) believed by
it to be genuine and signed or sent by the proper party or parties.
SECTION 03. Bankers Trust, Chemical, Citibank and
Affiliates. With respect to its Commitment and the Note issued to it, each
of Bankers Trust, Chemical and Citibank shall have the same rights and powers
under this Agreement as any other Lender and may exercise the same as though
it were not the Administrative Agent or a Co-Agent, as the case may be, and
the term "Lender" or "Lenders" shall, unless otherwise expressly indicated,
include Bankers Trust, Chemical and Citibank each in its individual capacity.
Bankers Trust, Chemical and Citibank and their respective Affiliates may
accept deposits from, lend money to, act as trustee under indentures of, and
generally engage in any kind of business with, the Borrower, any of its
subsidiaries and any Person who may do business with or own securities of the
Borrower or any such subsidiary, all as if Bankers Trust, Chemical and
Citibank were not the Administrative Agent or a Co-Agent, as the case may be,
and without any duty to account therefor to the Lenders.
SECTION 04. Lender Credit Decision. Each Lender
acknowledges that it has, independently and without reliance upon the
Administrative Agent, the Co-Agents or any other Lender and based on the
Information Memorandum and other financial information referred to in Section
6.01(e) and such other documents and information as it has deemed
appropriate, made its own credit analysis and decision to enter into this
Agreement, including, without limitation, in the case of the Lenders, with
respect to the determination as to whether to classify the transactions
evidenced by the Loan Documents as an "HLT" (as defined in Banking Circular
BC-242, issued by the Comptroller of the Currency on October 30, 1989, as
supplemented from time to time). Each Lender also acknowledges that it will,
independently and without reliance upon the Administrative Agent, the Co-
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66
Agents 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. In that regard, the
Lenders, the Co-Agents and the Administrative Agent acknowledge that none of
them has classified the transactions evidenced by the Loan Documents as an
"HLT", and agree with each other that, in the event that any of them shall
subsequently determine to classify such transactions as an "HLT", it will
provide notice to such effect to the other Lenders and the Administrative
Agent, as applicable, prior to or promptly following effecting such
classification.
SECTION 05. Indemnification. The Lenders agree to
indemnify the Co-Agents and the Administrative Agent (to the extent not
reimbursed by the Borrower), ratably according to the respective principal
amounts of the Notes then held by each of them (or if no Notes are at the
time outstanding or if any Notes are held by Persons which are not Lenders,
ratably according to the respective Commitments of the Lenders), from and
against any and all liabilities, obligations, losses, damages, penalties,
actions, judgments, suits, costs, expenses or disbursements of any kind or
nature whatsoever which may be imposed on, incurred by, or asserted against
the Administrative Agent or the Co-Agents in any way relating to or arising
out of this Agreement or any action taken or omitted by the Administrative
Agent or the Co-Agents under this Agreement, provided that no Lender shall be
liable for any portion of such liabilities, obligations, losses, damages,
penalties, actions, judgments, suits, costs, expenses or disbursements
resulting from the Administrative Agent's or any Co-Agent's gross negligence
or willful misconduct. Without limitation of the foregoing, each Lender
agrees to reimburse the Administrative Agent and the Co-Agents promptly upon
demand for its ratable share of any out-of-pocket expenses (including counsel
fees) incurred by the Administrative Agent and the Co-Agents in connection
with the preparation, execution, delivery, administration, modification,
amendment or enforcement (whether through negotiations, legal proceedings or
otherwise) of, or legal advice in respect of rights or responsibilities
under, this Agreement to the extent that the Administrative Agent and the Co-
Agents are entitled to reimbursement for such expenses pursuant to Section
10.04 but is not reimbursed for such expenses by the Borrower.
SECTION 06. Successor Administrative Agent. The
Administrative Agent may resign at any time by giving written notice thereof
to the Lenders and the Borrower, with any such resignation to become
effective only upon the appointment of a successor Administrative Agent
pursuant to this Section 9.06. Upon any such resignation, the Majority
Lenders shall have the right to appoint a successor Administrative Agent,
which shall be a Co-Agent (unless each Co-Agent shall decline such
appointment, in which case such successor Administrative Agent shall be a
Lender or another commercial bank or trust company reasonably acceptable to
the Borrower organized or licensed under the laws of the United States, or of
any State thereof). If no successor Administrative Agent shall have been so
appointed by the Majority Lenders, and shall have accepted such appointment,
within 30 days after the retiring Administrative Agent's giving of notice of
resignation, then the retiring Administrative Agent may, on behalf of the
Lenders, appoint a successor Administrative Agent, which shall be a Co-Agent
(unless each Co-Agent shall decline such appointment, in which case such
successor Administrative Agent shall be a Lender or shall be another
commercial bank or trust company organized or licensed under the laws of the
United States or of any State thereof reasonably acceptable to the Borrower).
In addition to the foregoing right of the Administrative Agent to resign, the
Majority Lenders may remove the Administrative Agent at any time, with or
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67
without cause, concurrently with the appointment by the Majority Lenders of a
Co-Agent as the successor Administrative Agent. Upon the acceptance of any
appointment as Administrative Agent hereunder by a successor Administrative
Agent and the execution and delivery by the Borrower and the successor
Administrative Agent of an agreement relating to the fees to be paid to the
successor Administrative Agent under Section 2.02(b) hereof in connection
with its acting as Administrative Agent hereunder, such successor
Administrative Agent shall thereupon succeed to and become vested with all
the rights, powers, privileges and duties of the retiring Administrative
Agent, and the retiring Administrative Agent shall be discharged from its
duties and obligations under this Agreement. After any retiring
Administrative Agent's resignation or removal hereunder as Administrative
Agent, the provisions of this Article IX shall inure to its benefit as to any
actions taken or omitted to be taken by it while it was Administrative Agent
under this Agreement.
ARTICLE X
MISCELLANEOUS
SECTION 01. Amendments, Etc. No amendment or waiver
of any provision of this Agreement, any Note or any Security Document, nor
consent to any departure by the Borrower therefrom, shall in any event be
effective unless the same shall be in writing and signed by the Majority
Lenders, and then such waiver or consent shall be effective only in the
specific instance and for the specific purpose for which given; provided,
however, that no amendment, waiver or consent shall, unless in writing and
signed by all the Lenders, do any of the following: (a) waive, modify or
eliminate any of the conditions specified in Article V, (b) increase the
Commitments of the Lenders that may be maintained hereunder or subject the
Lenders to any additional obligations, (c) reduce the principal of, or
interest on, the Notes, any Applicable Contract Margin or any fees or other
amounts payable hereunder, (d) postpone any date fixed for any payment of
principal of, or interest on, the Notes or any fees or other amounts payable
hereunder (other than fees payable to the Administrative Agent pursuant to
Section 2.02(b) hereof), (e) change the percentage of the Commitments or of
the aggregate unpaid principal amount of the Notes, or the number of Lenders
which shall be required for the Lenders or any of them to take any action
hereunder, (f) amend this Agreement, any Note or any Security Document in a
manner intended to prefer one or more Lenders over any other Lenders,
(g) amend this Section 10.01, or (h) release all or substantially all of the
Collateral otherwise than in accordance with the provisions for such release
contained in the Security Documents, or change any provision of any Security
Document providing for the release of all or substantially all of the
Collateral; and provided, further, that no amendment, waiver or consent
shall, unless in writing and signed by the Administrative Agent in addition
to the Lenders required above to take such action, affect the rights or
duties of the Administrative Agent under this Agreement or any Note.
SECTION 02. Notices, Etc. Except as otherwise
provided in Section 3.04 hereof, all notices and other communications
provided for hereunder and under the other Loan Documents shall be in writing
(including telegraphic, telex, telecopy or cable communication) and mailed,
telegraphed, telexed, telecopied, cabled or delivered, (i) if to the
Borrower, at its address at 1000 Elm Street, Manchester, New Hampshire 03105
(telecopy no. 603.669.2438), Attention: Treasurer, with a copy to NUSCO at
its address at 107 Selden Street, Berlin, Connecticut 06037 (telecopy no.
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203.665.5457), Attention: Assistant Treasurer; (ii) if to any Bank, at its
Domestic Lending Office specified opposite its name on Schedule I hereto;
(iii) if to any Lender other than a Bank, at its Domestic Lending Office
specified in the Lender Assignment pursuant to which it became a Lender; and
(iv) if to the Administrative Agent, at its address at 277 Park Avenue, New
York, New York 10172, Attention: C.J.E. Feeley: Utilities Group; 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, telegraphed, telexed, telecopied or cabled, be effective
five days after when deposited in the mails, or when delivered to the
telegraph company, confirmed by telex answerback, telecopied or delivered to
the cable company, respectively, except that notices and communications to
the Administrative Agent pursuant to Article II, III, IV or IX shall not be
effective until received by the Administrative Agent. With respect to any
telephone notice given or received by the Administrative Agent pursuant to
Section 3.04 hereof, the records of the Administrative Agent shall be
conclusive for all purposes.
SECTION 03. No Waiver of Remedies. No failure on the
part of any Lender or the Administrative Agent to exercise, and no delay in
exercising, any right hereunder or under any Note shall operate as a waiver
thereof; nor shall any single or partial exercise of any such right preclude
any other or further exercise thereof or the exercise of any other right. The
remedies herein provided are cumulative and not exclusive of any remedies
provided by law.
SECTION 04. Costs, Expenses and Indemnification.
(a) The Borrower agrees to pay on demand all costs and expenses, if any
(including, without limitation, reasonable counsel fees and expenses), of
(i) the Administrative Agent and each Co-Agent in connection with the
preparation, negotiation, execution and delivery of the Loan Documents and
the administration of the Loan Documents, the care and custody of any and all
collateral, and any proposed modification, amendment, or consent relating
thereto; and (ii) the Administrative Agent, each Co-Agent and each Lender in
connection with the enforcement (whether through negotiations, legal
proceedings or otherwise) of this Agreement, the Notes or any other Loan
Document.
(b) The Borrower hereby agrees to indemnify and hold
each Lender, each Co-Agent, the Administrative Agent and their respective
officers, directors, employees, professional advisors and affiliates (each,
an "Indemnified Person") harmless from and against any and all claims,
damages, losses, liabilities, costs or expenses (including reasonable
attorney's fees and expenses, whether or not such Indemnified Person is named
as a party to any proceeding or investigation or is otherwise subjected to
judicial or legal process arising from any such proceeding or investigation)
which any of them may incur or which may be claimed against any of them by
any person or entity (except to the extent such claims, damages, losses,
liabilities, costs or expenses arise from the gross negligence or willful
misconduct of the Indemnified Person):
(i) by reason of or in connection with the
execution, delivery or performance of any of the
Loan Documents or any transaction contemplated
thereby, or the use by the Borrower of the
proceeds of any Advance;
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(ii) in connection with or resulting from the
utilization, storage, disposal, treatment,
generation, transportation, release or ownership
of any Hazardous Substance (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; or
(iii) in connection with any documentary
taxes, assessments or charges made by any
governmental authority by reason of the execution
and delivery of any of the Loan Documents.
(c) The Borrower's obligations under this Section
10.04 shall survive the assignment by any Lender pursuant to Section 10.07
and shall survive as well the repayment of all amounts owing to the Lenders,
the Co-Agents and the Administrative Agent under the Loan Documents and the
termination of the Commitments. If and to the extent that the obligations of
the Borrower under this Section 10.04 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.
SECTION 05. Right of Set-off. (a) 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
8.02 to authorize the Administrative Agent to declare the Notes due and
payable pursuant to the provisions of Section 8.02, 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 the Note held by such Lender,
irrespective of 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.
(b) The Borrower agrees that it shall have no right of
off-set, 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 independent claim that the Borrower may have against
the Administrative Agent or any Lender, but no Lender shall be liable for the
conduct of the Administrative Agent or any other Lender, and the
Administrative Agent shall not be liable for the conduct of any Lender.
SECTION 06. Binding Effect. This Agreement shall
become effective when it shall have been executed by the Borrower and the
Administrative Agent and when the Administrative Agent shall have been
notified by each Bank that such Bank has executed it and thereafter shall be
binding upon and inure to the benefit of the Borrower, the Administrative
Agent and each Lender and their respective successors and assigns, except
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that the Borrower shall not have the right to assign its rights hereunder or
any interest herein without the prior written consent of the Lenders.
SECTION 07. Assignments and Participation. (a) Each
Lender may assign to one or more banks or other entities all or a portion of
its rights and obligations under this Agreement, the Notes and the Security
Documents (including, without limitation, all or a portion of its Commitment,
the Advances owing to it and the Note or Notes held by it) with the prior
written consent of the Borrower to the extent the assignee thereunder is not
then a Lender or an Affiliate of a Lender (which consent shall not be
unreasonably withheld); provided, however, that (i) 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, (ii) to the extent the
assignee thereunder is not then a Lender or an Affiliate of a Lender, the
amount of the Commitment or Note of the assigning Lender being assigned
pursuant to each such assignment (determined as of the date of the Lender
Assignment with respect to such assignment) shall in no event be less than
the lesser of the amount of such Lender's Commitment and $3,000,000, and
(iii) the parties to each such assignment shall execute and deliver to the
Administrative Agent, for its acceptance and recording in the Register, a
Lender Assignment, together with any Note or Notes subject to such assignment
and a processing and recordation fee of $2,000. Upon such execution,
delivery, acceptance and recording, from and after the effective date
specified in each Lender Assignment, which effective date shall be at least
five Business Days after the execution thereof, (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 Lender Assignment, 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 to an assignee pursuant to such Lender Assignment,
relinquish its rights and be released from its obligations under this
Agreement (and, in the case of a Lender Assignment 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); provided, however,
if an Event of Default shall have occurred and be continuing and the
Administrative Agent shall have declared all Advances to be immediately due
and payable hereunder a Lender may assign all or a portion of its rights and
obligations without the prior written consent of the Borrower but otherwise
in accordance with this Section.
(b) By executing and delivering a Lender Assignment,
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 Lender Assignment, 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 any
Loan Document or the execution, legality, validity, enforceability,
genuineness, sufficiency or value of any Loan Document or any other
instrument or document furnished pursuant thereto; (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 any Loan Document
or any other instrument or document furnished pursuant thereto; (iii) such
assignee confirms that it has received a copy of each Loan Document, together
with copies of the financial statements referred to in Section 6.01(e) and
such other documents and information as it has deemed appropriate to make its
own credit analysis and decision to enter into such Lender Assignment;
(iv) such assignee will, independently and without reliance upon the
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EXHIBIT B.2
FIRST AMENDMENT TO THE
REVOLVING CREDIT AGREEMENT
Dated as of May __, 1994
This FIRST AMENDMENT is made by and among PUBLIC SERVICE COMPANY
OF NEW HAMPSHIRE, a New Hampshire corporation (the Borrower ); the banks
listed on the signature page of this Amendment (together with their
respective permitted assignees from time to time, the Lenders ); BANKERS
TRUST COMPANY, CHEMICAL BANK and CITIBANK, N.A., as agents for the Lenders
(the Agents ) and CHEMICAL BANK as administrative agent for the Lenders (the
Administrative Agent ).
PRELIMINARY STATEMENTS:
(1)The Borrower, the Agents, the Lenders and the Administrative
Agent have entered into a Revolving Credit Agreement, dated as of May 1, 1991
in the amount of U.S.$200,000,000 (the Revolving Credit Agreement ).
Capitalized terms used but not defined herein shall have the meanings
assigned such terms in the Revolving Credit Agreement.
(2)The Borrower has requested that the Lenders (i) extend the
Termination Date from May 14, 1994 to May 14, 1996, and (ii) amend the
Revolving Credit Agreement to reflect such extension.
(3)The Lenders, on the terms and conditions hereinafter set forth,
are willing to grant the requests of the Borrower.
NOW, THEREFORE, in consideration of the premises and in order to
induce the Lenders to extend the Termination Date and amend the Revolving
Credit Agreement, the parties hereto agree as follows:
SECTION 1. Amendments to Credit Agreement. The Revolving Credit
Agreement is, effective as of the date hereof and subject to the satisfaction
of the conditions precedent set forth in Section 3 hereof, hereby amended as
follows:
(a) The defined term Termination Date contained in
Section 1.01 is amended in full to read as follows:
Termination Date means the earlier to occur of
(i) May 14, 1996, (ii) the date of termination or reduction in
whole of the Commitments pursuant to Section 2.03 or 8.02, or
(iii) the date of acceleration of all amounts payable hereunder
and under the Notes pursuant to Section 8.02.
(b) Section 7.01(j) is amended in full to read as follows:
(i) Operating
Income to Interest Expense. Maintain, for each period
of four consecutive fiscal quarters ending on the dates
set forth below, a ratio of Operating Income to
<PAGE>
Interest Expense not less than the respective ratio
specified below:
Period of Four Fiscal
Quarters Ending on the
Following Dates:
Ratio
June 30, 1992 1.30:1
September 30, 1992
1.30:1
December 31, 1992
1.40:1
March 31, 19931.40:1
June 30, 1993 1.40:1
September 30, 1993
1.40:1
December 31, 1993
1.50:1
March 31, 19941.50:1
June 30, 1994 1.50:1
September 30, 1994
1.50:1
December 31, 1994
1.75:1
March 31, 19951.75:1
June 30, 1995 1.75:1
September 30, 1995
1.75:1
December 31, 1995
1.75:1
Termination Date1.75:1
(ii) Common Equity
to Total Capitalization. Maintain at all times a ratio
of Common Equity to Total Capitalization of not less
than the respective ratio specified below:
Period Ratio
Funding Date through
and
including June 30,
1993 0.20:1
July 1, 1993 through
and
including June 30,
1994 0.21:1
July 1, 1994 through
and
including June 30,
1995 0.23:1
July 1, 1995 through
and
including the
Termination
Date 0.25:1
<PAGE>
SECTION 2. Conditions of Effectiveness. This Amendment shall
become effective when, and only when, the Administrative Agent, the Agents
and each Lender party to this Amendment shall have received counterparts of
this Amendment executed by the Borrower, and Section 1 of this Amendment
shall become effective when, and only when, the Administrative Agent, the
Agents and each Lender additionally shall have received all of the following
documents, each (unless otherwise indicated) being dated the date of receipt
thereof by the Lenders (which date shall be the same for all such documents),
in form and substance satisfactory to the Lenders:
(a) The Administrative Agent shall have received the
following, each dated the date of delivery thereof (unless
otherwise specified below), in form and substance satisfactory to
each Lender and in sufficient copies for each Lender:
(i) Certified copies of
the resolutions of the Board of Directors of the Borrower
approving, if and to the extent necessary, this Amendment to be
delivered by the Borrower hereunder, and of all documents
evidencing other necessary corporate action, if any, with
respect to the execution, delivery and performance by the
Borrower of this Amendment.
(ii) A certificate of the
Secretary of the Borrower certifying (A) the names and true
signatures of the officers of the Borrower authorized to sign
this Amendment to be delivered hereunder and (B) that attached
thereto are true and correct copies of the Articles of
Incorporation of the Borrower, and all amendments thereto, and
the Bylaws of the Borrower, in each case as in effect on such
date.
(iii) Such other approvals,
opinions and documents as any Lender, through the
Administrative Agent, may reasonably request as to the
legality, validity, binding effect or enforceability of this
Amendment.
[(b) Receipt of an extension fee referred to in that certain
Letter, dated May ___, 1994, by and among the Administrative
Agent, the Agents and the Borrower.]
(c) A favorable opinion of [Pierre O. Caron,] Assistant
General Counsel to the Borrower.
(d) A favorable opinion of Day, Berry and Howard, counsel
to the Borrower.
(e) A favorable opinion of Drummond Woodsum Plimpton &
MacMahon, as Maine counsel to the Borrower.
(f) A favorable opinion of Zuccaro, Willis & Bent, as
Vermont counsel to the Borrower.
SECTION 3. Representations and Warranties of the Borrower. The
Borrower represents and warrants as follows:
(a)The execution, delivery and performance by the Borrower of this
Amendment are within the Borrower's corporate powers, have been duly
<PAGE>
authorized by all necessary corporate action and do not contravene (i) the
Borrower's charter or by-laws, (ii) law or (iii) any contractual restriction
binding on or affecting the Borrower, and do not result in or require the
creation of any Lien upon or with respect to any of its properties.
(b) No authorization, approval or other action by, and no
notice to or filing with, any governmental authority or regulatory body is
required for the due execution, delivery and performance by the Borrower of
this Amendment, except for the Government Approvals that have been obtained
or will be obtained in due course.
(c) This Amendment and the Revolving Credit Agreement, as
amended by this Amendment, constitute the legal, valid and binding
obligations of the Borrower, enforceable against the Borrower in accordance
with their respective terms, subject to ^@ the effect of applicable bankruptcy,
insolvency, reorganization or moratorium or other similar laws affecting the
enforcement of creditors' rights generally, and ^@ the application of general
principles of equity (regardless of whether considered in a proceeding in
equity or at law).
(d)The audited balance sheet of the Borrower and its Consolidated
Subsidiaries as at December 31, 1993, and the related statements of income,
retained earnings and cash flows of the Borrower and its Consolidated
Subsidiaries for the fiscal year then ended, (a copy of which has been
furnished to the Lenders), fairly present (subject to year-end adjustments)
the financial condition of the Borrower and its Consolidated Subsidiaries as
at such date and the results of operations of the Borrower and its
Consolidated Subsidiaries for the year ended on such date, all in accordance
with GAAP.
(e) Except as described in the Borrower's reports filed
with the Securities and Exchange Commission, there is no pending or
threatened action or proceeding against the Borrower or any of its
Consolidated Subsidiaries before any court, governmental agency or
arbitrator, which might reasonably be expected to materially adversely affect
the ability of the Borrower to perform its obligations under this Amendment
or the Revolving Credit Agreement, as amended by this Amendment.
SECTION 4. Reference to and Effect on the Revolving Credit
Agreement. (a) Upon the effectiveness of Section 1 hereof, on and after the
date hereof each reference in the Revolving Credit Agreement to this
Agreement , hereunder , hereof or words of like import referring to the
Revolving Credit Agreement, and each reference in the other Loan Documents to
the Credit Agreement , thereunder , thereof or words of like import
referring to the Revolving Credit Agreement, shall mean and be a reference to
the Revolving Credit Agreement as amended hereby.
(b)Except as specifically amended above, the Revolving Credit
Agreement shall continue to be in full force and effect and is hereby in all
respects ratified and confirmed. Without limiting the generality of the
foregoing, the Loan Documents and all of the Collateral described therein do
and shall continue to secure the payment of all obligations of the Borrower
under the Revolving Credit Agreement as amended hereby.
(c)The execution, delivery and effectiveness of this Amendment
shall not, except as expressly provided herein, operate as a waiver of any
right, power or remedy of the Lenders, Administrative Agent or Collateral
Agent under the Revolving Credit Agreement or Loan Documents, nor constitute
a waiver of any provision of the Revolving Credit Agreement or Loan
Documents.
<PAGE>
SECTION 5. Costs, Expenses and Taxes. The Borrower agrees to pay
on demand all costs and expenses of the Administrative Agent in connection
with the preparation, execution and delivery of this Amendment and the other
instruments and documents to be delivered hereunder, including, without
limitation, the reasonable fees and out-of-pocket expenses of King &
Spalding, counsel for the Administrative Agent with respect thereto and with
respect to advising the Lenders as to their rights and responsibilities
hereunder and thereunder. 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 Amendment and the other instruments and
documents to be delivered hereunder, and agrees to save the Administrative
Agent and the Lenders harmless from and against any and all liabilities with
respect to or resulting from any delay in paying or omission to pay such
taxes.
SECTION 6. Execution in Counterparts. This Amendment may be
executed in any number of counterparts and by different parties hereto in
separate counterparts, each of which when so executed and delivered shall be
deemed to be an original and all of which taken together shall constitute but
one and the same instrument.
SECTION 7. Governing Law. This Amendment shall be governed by,
and construed in accordance with, the laws of the State of the New York.
<PAGE>
IN WITNESS WHEREOF, the parties hereto have caused this Amendment
to be executed by their respective officers thereunto duly authorized, as of
the date first above written.
PUBLIC SERVICE COMPANY OF
NEW HAMPSHIRE, as Borrower
By:________________________________
Name:
Title:
CHEMICAL BANK, as Administrative
Agent
By:________________________________
Name:
Title:
BANKERS TRUST COMPANY,
as Agent
By:________________________________
Name:
Title:
CHEMICAL BANK, as Agent
By:________________________________
Name:
Title:
THIS IS A SIGNATURE PAGE TO THE FIRST AMENDMENT TO THE REVOLVING CREDIT
AGREEMENT OF PUBLIC SERVICE COMPANY OF NEW HAMPSHIRE AND IS EXECUTED BY THE
PARTIES NAMED ABOVE.
<PAGE>
CITIBANK, N.A., as Agent
By:________________________________
Name:
Title:
BANK OF AMERICA NT&SA
By:________________________________
Name:
Title:
THE BANK OF CALIFORNIA, N.A.
By:________________________________
Name:
Title:
BANKERS TRUST COMPANY
By:________________________________
Name:
Title:
THIS IS A SIGNATURE PAGE TO THE FIRST AMENDMENT TO THE REVOLVING CREDIT
AGREEMENT OF PUBLIC SERVICE COMPANY OF NEW HAMPSHIRE AND IS EXECUTED BY THE
PARTIES NAMED ABOVE.
<PAGE>
BARCLAYS BANK PLC
By:________________________________
Name:
Title:
CIBC INC.
By:________________________________
Name:
Title:
CHEMICAL BANK
By:________________________________
Name:
Title:
CITIBANK, N.A.
By:________________________________
Name:
Title:
CONTINENTAL BANK, N.A.
By:________________________________
Name:
Title:
THIS IS A SIGNATURE PAGE TO THE FIRST AMENDMENT TO THE REVOLVING CREDIT
AGREEMENT OF PUBLIC SERVICE COMPANY OF NEW HAMPSHIRE AND IS EXECUTED BY THE
PARTIES NAMED ABOVE.
<PAGE>
THE FIRST NATIONAL BANK
OF BOSTON
By:________________________________
Name:
Title:
THE FIRST NATIONAL BANK
OF CHICAGO
By:________________________________
Name:
Title:
THE FUJI BANK, LIMITED
By:________________________________
Name:
Title:
LTCB TRUST COMPANY
By:________________________________
Name:
Title:
MELLON BANK, N.A.
By:________________________________
Name:
Title:
THIS IS A SIGNATURE PAGE TO THE FIRST AMENDMENT TO THE REVOLVING CREDIT
AGREEMENT OF PUBLIC SERVICE COMPANY OF NEW HAMPSHIRE AND IS EXECUTED BY THE
PARTIES NAMED ABOVE.
<PAGE>
MITSUI TRUST BANK (USA)
By:________________________________
Name:
Title:
NATIONAL WESTMINSTER BANK,
PLC NEW YORK BRANCH
By:________________________________
Name:
Title:
NATIONAL WESTMINSTER BANK,
PLC NASSAU BRANCH
By:________________________________
Name:
Title:
THE NIPPON CREDIT BANK, LTD.
By:________________________________
Name:
Title:
SHAWMUT BANK CONNECTICUT, N.A.
By:________________________________
Name:
Title:
THIS IS A SIGNATURE PAGE TO THE FIRST AMENDMENT TO THE REVOLVING CREDIT
AGREEMENT OF PUBLIC SERVICE COMPANY OF NEW HAMPSHIRE AND IS EXECUTED BY THE
PARTIES NAMED ABOVE.
<PAGE>
SWISS BANK CORPORATION
NEW YORK BRANCH
By:________________________________
Name:
Title:
TOKAI BANK, LIMITED, NEW YORK
BRANCH
By:________________________________
Name:
Title:
TORONTO-DOMINION (NEW YORK), INC.
By:________________________________
Name:
Title:
UNION BANK
By:________________________________
Name:
Title:
YASUDA TRUST AND BANKING CO.,
LTD. NEW YORK BRANCH
By:________________________________
Name:
Title:
THIS A SIGNATURE PAGE TO THE FIRST AMENDMENT TO THE REVOLVING CREDIT
AGREEMENT OF PUBLIC SERVICE COMPANY OF NEW HAMPSHIRE AND IS EXECUTED BY THE
PARTIES NAMED ABOVE.
EXHIBIT D.1
March 8, 1994
VIA HAND DELIVERY
Ms. Debra Howland
Assistant Secretary
State of New Hampshire
Public Utilities Commission
8 Old Suncook Road
Concord, New Hampshire 03301
RE: Extension of Revolving Credit Agreement
Dear Ms. Howland:
On behalf of Public Service Company of New Hampshire ("PSNH"), I
hereby request that the New Hampshire Public Utilities Commission approve,
pursuant to RSA 369:1, RSA 369:2 and RSA 369:4, the extension of the
Revolving Credit Agreement and associated second mortgage from its current
expiration date of May 14, 1994 to May 14, 1996. As detailed in the enclosed
affidavit of David R. McHale, Manager of Project and Short Term Finance of
Northeast Utilities Service Company, the proposed extension will occur
pursuant to substantially the same terms and conditions of the existing
Revolving Credit Agreement and associated second mortgage, which was approved
by the Commission in DR 89-244.
The operating income to expense ratio and common equity to total
capitalization ratio requirements included in the Revolver will be extended
for the period May 14, 1994 through May 14, 1996, and will conform to the
corresponding requirements in the Term Credit Agreement, which were approved
by the Commission in DR 89-244. An extension fee of no more than 15 basis
points, or $187,500 will be charged, and the facility fee may be increased
from 25 basis points per annum to a maximum of 37.5 basis points per annum,
or an increase of not more than $156,250 per year. The terms of the proposed
extension are as favorable to PSNH as any PSNH could expect to receive for a
new revolving credit facility, and will result in a significant transaction
cost savings because PSNH will not need to negotiate and draft entirely new
documents. Consequently, PSNH submits that the proposed extension is
consistent with the public good and should be approved by the Commission.
Accordingly, PSNH requests that the Commission determine under RSA
369:1, RSA 369:2 and RSA 369:4 that the extension of the Revolving Credit
Agreement pursuant to the terms and conditions set forth in Mr. McHale's
affidavit are consistent with the public good and are approved.
Because the proposed extension is substantially in accordance with
the terms and conditions of the Revolving Credit Agreement and Term Credit
Agreement approved by the Commission and does not otherwise materially alter
PSNH's obligations, PSNH submits that no hearing or investigation of facts
other than those contained in the attached affidavit is required.
Accordingly, PSNH requests that the Commission consider issuing the requested
approval in an Order NISI to expedite approval of the extension.
<PAGE>
If the Order NISI process is not deemed appropriate for some
reason, PSNH requests that the Commission promptly issue an Order of Notice
and establish a procedural schedule which would enable PSNH to close the
proposed transaction by April 29, 1994.
If you have any questions regarding this filing, or need any more
information, please let me know. I can be reached directly at 634-2326. I
will be on vacation March 9, 1994 through March 22, 1994. Any questions you
may have during my absence should be referred to Jerry Eaton, at 634-2961.
Very truly yours,
Catherine E. Shively
Senior Counsel
Public Service Company
of New Hampshire
Enclosure: Affidavit of David R. McHale, with
Exhibits 1 and 2
<PAGE>
AFFIDAVIT OF DAVID R. MCHALE
I, David R. McHale, being first duly sworn, do hereby state as
follows:
1. I am Manager of Project and Short Term Finance of Northeast
Utilities Service Company ("NUSCO"), which provides treasury and other
financial services to Public Service Company of New Hampshire ("PSNH")
pursuant to the terms and conditions of the Service Agreement between PSNH
and NUSCO.
2. On July 20, 1990, in Docket No. DR 89-244, the New Hampshire
Public Utilities Commission issued Report and Order No. 19,889 (the "Order"),
which, among other things, approved the reorganization of PSNH and PSNH's
acquisition by Northeast Utilities. One approval of the Commission contained
in this Order approved the borrowing of up to $200 million from time to time
by PSNH from a group of banks under a revolving credit facility, in
accordance with a Revolving Credit Agreement in substantially the form
submitted to the Commission. Order at p. 187-188. In connection with its
reorganization, PSNH entered into a Revolving Credit Agreement dated as May
1, 1991 among PSNH, the banks named therein (the "Banks") and Bankers Trust
Company, Chemical Bank and Citibank, N.A., as co-agents, and Chemical Bank,
as administrative agent (the "Revolving Credit Agreement"). The Revolving
Credit Agreement expires in accordance with its terms on May 14, 1994. PSNH
proposes to extend the Revolving Credit Agreement to May 14, 1996.
3. Under the current terms of the Revolving Credit Agreement, PSNH
has commitments from the participating banks (the "Banks") for an aggregate
of $125 million. Pursuant the terms and conditions of the Revolving Credit
Agreement, the credit line was reduced from $200 million to $125 million on
the merger date, June 5, 1992. PSNH's obligations under the Revolving Credit
Agreement are secured by a second mortgage on certain of PSNH's assets.
4. PSNH pays quarterly to each participating bank facility fee
(the "Facility Fee") equal to 25 basis points per annum of that Bank's
commitment, and it pays an agency fee to each of the co-agents and the
administrative agent as agreed to from time to time. In connection with the
proposed extension of the Revolving Credit Agreement, the facility fee may be
increased from the current fee of 25 basis points per annum ($312,500) to
higher amount to be negotiated, but not exceeding a maximum of 37.5 basis
points per annum ($468,750), or an increase of no more than $156,250 per
year.
5. The interest rate terms of the Revolving Credit Agreement
remain unchanged. Interest on borrowings under the Revolving Credit
Agreement accrues on one or more of four bases at PSNH's option. The first
is a "Eurodollar Rate" equal to the average of the co-agents' London
Interbank Offered Rates plus a margin of 50 basis points. Borrowings under
the Eurodollar Rate option can have maturities of one, two, three or six
months. The second interest rate option is a "CD Rate" equal to the average
of the co-agents' certificate of deposit rates plus a margin of 87.5 basis
points. Borrowings under the CD Rate option can have maturities of thirty,
sixty, ninety or 180 days. The third option is an "Alternate Base Rate"
equal to the greater of Chemical Bank's prime lending rate or the Federal
Funds Rate in effect plus a margin of 50 basis points. Borrowings under the
Alternate Base Rate option can be repaid at any time prior to the termination
of the Revolving Credit Agreement. The final interest rate option is a rate
bid by some or all of the participating banks in a competitive bid procedure.
<PAGE>
-2-
Borrowings under the competitive bid option can have any maturity up to 270
days.
6. The margins on the Eurodollar Rate, CD Rate and Alternative
Base Rate borrowings increase by 25 basis points if either Standard & Poor's
Corporation or Moody's Investor Service, Inc. fails to give PSNH's first
mortgage bonds an investment grade rating and by 37.5 basis points if the
advance on which that interest is accruing would be considered a "Highly
Leveraged Transaction" under applicable banking regulations. Thus, so long
as PSNH's first mortgage bonds are rated BB+ by Standard & Poor's
Corporation, the applicable interest rate would include an additional margin
of 25 basis points.
7. Financial covenants similar to those included in the Revolving
Credit Agreement for prior periods, and identical to those included in the
Term Credit Agreement dated as May 1, 1991 among PSNH, the banks named
therein (the "Banks") and Bankers Trust Company, Chemical Bank and Citibank,
N.A., as co-agents, and Citibank, N.A., as administrative agent (the "Term
Credit Agreement") are proposed to be added to the Revolving Credit Agreement
and applicable to the extension period. PSNH will be required to maintain a
ratio of operating income to interest expense on a rolling four quarters
basis, measured at the end of each quarter, of 1.50 to 1 through September
30, 1994, and of 1.75 to 1 from December 31, 1994 through May 14, 1996. PSNH
will be required to maintain a common equity to total capitalization ratio of
0.21 to 1 through June 30, 1994; a common equity to total capitalization
ratio of 0.23 to 1 from July 1, 1994 through June 30, 1995; and a common
equity to total capitalization ratio of 0.25 to 1 from July 1, 1995 through
May 14, 1996. See, Section 7.01(j) of the Revolving Credit Agreement,
attached hereto as Exhibit 1, and Section 7.01(j) of the Term Credit
Agreement, attached hereto as Exhibit 2.
8. In consideration of the proposed extension, the Banks will
charge PSNH an extension fee to be negotiated of not more than 15 basis
points of their respective commitments under the Revolving Credit Agreement,
or a maximum of $187,500.
9. The final amendment to the Revolving Credit Agreement
incorporating the amendments and additions described herein will be filed
with the Commission when executed.
10.As noted above, the Revolving Credit Agreement currently
expires on May 14, 1994. PSNH has discussed with various potential lenders
the terms on which it could replace the Revolving Credit Agreement with
another revolving credit facility. As PSNH discussed with the Banks and
other potential lenders the various options available to replace the
Revolving Credit Agreement, it became apparent that the terms of the
Revolving Credit Agreement are as favorable to PSNH as any terms PSNH could
expect to receive for a new facility. Accordingly, PSNH requested that the
Banks extend the term of the present Revolving Credit Agreement for two more
years, to May 14, 1996. The proposed extension will result in the matching
of the expiration date of the Revolving Credit Agreement and PSNH's Term
Credit Agreement dated as of May 1, 1991 with the same group of Banks (the
"Term Credit Agreement"). It will also result in significant transaction
cost savings because PSNH will not need to negotiate and draft entirely new
agreements.
<PAGE>
-3-
11.The proposed extension is consistent with the public good
because the extension will provide PSNH with continued access to a revolving
credit facility during the period from May 14, 1994 to May 14, 1996 at
favorable interest rates, without requiring PSNH to make any substantially
new or more restrictive business covenants than those that currently exist
under agreements already reviewed and approve by the Commission in DR 89-
244. The proposed extension is also consistent with the public good because
it will enable PSNH to avoid the legal and bank fees and other transaction
costs associated with negotiating and drafting an entirely new agreement.
Dated:______________
_________________________________
David R. McHale
State of Connecticut
County of Hartford
The foregoing instrument was acknowledged before me this _____ day
of March, 1994 by David R. McHale.
________________________________
Notary Public
My Commission Expires:__________
<PAGE>
Exhibit 1
EXECUTION COPY
U.S. $200,000,000
REVOLVING CREDIT AGREEMENT
Dated as of May 1, 1991
Among
PUBLIC SERVICE COMPANY OF NEW HAMPSHIRE
as Borrower
THE BANKS NAMED HEREIN
as Banks
BANKERS TRUST COMPANY
CHEMICAL BANK
CITIBANK, N.A.
as Co-Agents
CHEMICAL BANK
as Administrative Agent
<PAGE>
(g)Keeping of Books. Keep proper records and books of account, in
which full and correct entries shall be made of all financial transactions of
the Borrower and the assets and business of the Borrower, in accordance with
good accounting practices consistently applied.
(h)Performance of Related Agreements.
(i) From and after the
effective date of the Rate Agreement, the Merger Agreement and
each Significant Contract, (A) perform and observe all material
terms and provisions of such agreements to be performed or
observed by the Borrower and (B) take all reasonable steps to
enforce such agreements substantially in accordance with their
terms and to preserve the rights of the Borrower thereunder;
provided, that the foregoing provisions of this Section 7.01(h)
shall not preclude the Borrower from any waiver, amendment,
modification, consent or termination permitted under Section
7.02(h) hereof.
(ii) Upon any termination
of the Merger Agreement, cause NUSCO to continue its obligations
under the Management Services Agreement pursuant to Section
7(b)(i) thereof until the earlier of (A) 45 days after written
notice from the Borrower to the Administrative Agent of the
Borrower's intention to terminate such arrangement or (B)
expiration of the six-month period specified in said Section
7(b)(i).
(i)Collection of Accounts Receivable. Promptly bill, and
diligently pursue collection of, in accordance with customary utility
practices, all accounts receivable owing to the Borrower and all other
amounts that may from time to time be owing to the Borrower for services
rendered or goods sold.
(j)Maintenance of Financial Covenants.
(i) Operating Income to
Interest Expense. Maintain, for each period of four consecutive
fiscal quarters ending on the dates set forth below, a ratio of
Operating Income to Interest Expense not less than the respective
ratio specified below:
Period of Four Fiscal
Quarters Ending on the
Following Dates: Ratio
June 30, 1992 1.30:1
September 30, 1992 1.30:1
December 31, 1992 1.40:1
March 31, 1993 1.40:1
June 30, 1993 1.40:1
September 30, 1993 1.40:1
December 31, 1993 1.50:1
March 31, 1994 1.50:1
Termination Date 1.50:1
(ii) Common Equity to Total
Capitalization. Maintain at all times a ratio of Common Equity to
<PAGE>
-2-
Total Capitalization of not less than the respective ratio
specified below:
Prior to the Merger
Effective Date:
Period Ratio
Funding Date through and 0.26:1
including December 31, 1991
January 1, 1992 through and 0.28:1
including September 30, 1993
October 1, 1993 through and 0.30:1
including the Termination Date
On and After the
Merger Effective Date:
Period Ratio
Funding Date through and 0.20:1
including June 30, 1993
July 1, 1993 through and 0.21:1
including the Termination Date
<PAGE>
Exhibit 2
EXECUTION COPY
U.S. $452,000,000
REVOLVING CREDIT AGREEMENT
Dated as of May 1, 1991
Among
PUBLIC SERVICE COMPANY OF NEW HAMPSHIRE
as Borrower
THE BANKS NAMED HEREIN
as Banks
BANKERS TRUST COMPANY
CHEMICAL BANK
CITIBANK, N.A.
as Co-Agents
CHEMICAL BANK
as Administrative Agent
<PAGE>
(g)Keeping of Books. Keep proper records and books of account, in
which full and correct entries shall be made of all financial transactions of
the Borrower and the assets and business of the Borrower, in accordance with
good accounting practices consistently applied.
(h)Performance of Related Agreements.
(i) From and after the
effective date of the Rate Agreement, the Merger Agreement and
each Significant Contract, (A) perform and observe all material
terms and provisions of such agreements to be performed or
observed by the Borrower and (B) take all reasonable steps to
enforce such agreements substantially in accordance with their
terms and to preserve the rights of the Borrower thereunder;
provided, that the foregoing provisions of this Section 7.01(h)
shall not preclude the Borrower from any waiver, amendment,
modification, consent or termination permitted under Section
7.02(h) hereof.
(ii) Upon any termination
of the Merger Agreement, cause NUSCO to continue its obligations
sunder the Management Services Agreement pursuant to Section
7(b)(i) thereof until the earlier of (A) 45 days after written
notice from the Borrower to the Administrative Agent of the
Borrower's intention to terminate such arrangement or (B)
expiration of the six-month period specified din said Section
7(b)(i).
(i)Collection of Accounts Receivable. Promptly bill, and
diligently pursue collection of, in accordance with customary utility
practices, all accounts receivable owing to the Borrower and all other
amounts that may from time to time be owing to the Borrower for services
rendered or goods sold.
(j)Maintenance of Financial Covenants.
(i) Operating Income to
Interest Expense. Maintain, for each period of four consecutive
fiscal quarters ending on the dates set forth below, a ratio of
Operating Income to Interest Expense not less than the respective
ratio specified below:
Period of Four Fiscal
Quarters Ending on the
Following Dates: Ratio
June 30, 1992 1.30:1
September 30, 1992 1.30:1
December 31, 1992 1.40:1
March 31, 1993 1.40:1
June 30, 1993 1.40:1
September 30, 1993 1.40:1
December 31, 1993 1.50:1
March 31, 1994 1.50:1
June 30, 1994 1.50:1
September 30, 1994 1.50:1
December 31, 1994 1.75:1
March 31, 1995 1.75:1
June 30, 1995 1.75:1
September 30, 1995 1.75:1
<PAGE>
-2-
December 31, 1995 1.75:1
Termination Date 1.75:1
(ii) Common Equity to Total
Capitalization. Maintain at all times a ratio of Common Equity to
Total Capitalization of not less than the respective ratio
specified below:
Prior to the Merger
Effective Date:
Period Ratio
Funding Date through and 0.26:1
including December 31, 1991
January 1, 1992 through and 0.28:1
including September 30, 1993
October 1, 1993 through and 0.30:1
including September 30, 1994
October 1, 1994 through and 0.33:1
including September 30, 1995
October 1, 1995 through and 0.35:1
including the Termination Date
On and After the
Merger Effective Date:
Period Ratio
Funding Date through and 0.20:1
including June 30, 1993
July 1, 1993 through and 0.21:1
including June 30, 1994
July 1, 1994 through and 0.23:1
including June 30, 1995
July 1, 1995 through and 0.25:1
including the Termination Date
(k)Maintenance of Properties, Etc. (i) As to properties of the
type described in Section 6.01(i), maintain title of the quality described
therein; and (ii) preserve, maintain, develop, and operate in substantial
conformity with all laws, material contractual obligations and prudent
practices prevailing in the industry, all of its properties which are used or
useful in the conduct of its business in good working order and condition,
ordinary wear and tear excepted, except to the extent such non-conformity
would not materially adversely affect the financial condition, properties,
prospects or operations of the Borrower as a whole.
(l)Governmental Approvals. Duly obtain on or prior to such date
as the same may become legally required, and thereafter maintain in effect at
<PAGE>
-3-
all times, all Governmental Approvals on its part to be obtained, except
those the absence of which would not materially adversely affect the
financial condition, properties, prospects or operations of the Borrower as a
whole.
(m)Further Assurances. Promptly execute and deliver all further
instruments and documents, and take all further action, that may be necessary
or that any Lender through the Administrative Agent may reasonably request in
order to fully give effect to the interests and properties purported to be
covered by the Security Documents.
Exhibit D.2
DF 94-039
PUBLIC SERVICE COMPANY OF NEW HAMPSHIRE
Order Nisi Granting Authorization for Public Service
Company of New Hampshire for an Extension of
Revolving Credit Agreement
ORDER NO. 21,180
On March 8, 1994 Public Service Company of New Hampshire (Company
filed with the New Hampshire Public Utilities Commission (Commission) a
petition under RSA 369:1, RSA 369:2 and RSA 369:4 for the extension of it's
Revolving Credit Agreement; and
WHEREAS, the Commission in Order No. 19,889 dated July 20, 1990
approved the Revolving Credit Agreement until May 14, 1994; and
WHEREAS, the Company has proposed to extend the Credit Agreement
until May 14, 1996 under substantially the same terms and conditions as in
the original agreement; and
WHEREAS, the Company proposes to maintain the Revolving Credit
Agreement at it present level of One Hundred and Twenty Five Million Dollars
($125,000,000); and
WHEREAS, the extension requires an extension fee of no more than
15 basis points per annum or an increase of not more than $187,500; and
WHEREAS, the facility fee may be increased from 25 basis points to
37.5 basis points per annum or an increase of not more than $156,250; and
WHEREAS, the interest rate opinions will remain the same unless
the Company's First Mortgage Bonds are not down-graded from a rating of BB+
by Standard & Poor's Corporation, the applicable interest rate would include
an additional margin of 25 basis points; and
WHEREAS, the extension of the Revolving Credit Agreement will
require the company to maintain certain expense and capitalization ratios
<PAGE>
which are comparable to the existing ratios that the company is presently
required to maintain; and
WHEREAS, the Company states that a renegotiation the revolver
would increase the cost more than the extension fee due to increase legal and
other costs; and
WHEREAS, the Commission finds that the proposed extension of the
Revolving Credit Facility under substantially the same term and conditions is
in the public good; and
WHEREAS, the public should be offered the opportunity to respond
in support of, or in opposition to said petition; it is hereby
ORDERED, that all persons interested in responding to this
petition be notified that they may submit their comments or file a written
request for a hearing on this matter before the Commission no later than
April 29, 1994; and it is
FURTHER ORDERED, that the Petitioner effect said notification by
causing an attested copy of this order to be published no later than April
14, 1994, once in a newspaper having general circulation in the area where
the service is provided and documenting compliance with this notice
provisions by affidavit to be filed with the Commission on or before April
29, 1994; and it is.
FURTHER ORDERED NISI, that the extension of the Revolving Credit
Agreement be, and hereby is granted, pursuant to RSA 369:1 RSA 369:2 and RSA
369:4, effective April 29, 1994 unless the Commission otherwise directs prior
to the proposed effective date.
By order of the New Hampshire Public Utilities Commission this
fourth day of April, 1994.
__________________ _________________ ___________________
Douglas L. Patch Bruce B. Ellworth Susan S. Geiger
Chairman Commissioner Commissioner
<PAGE>
Attested By:
___________________________
Debra A. Howard
Assistant Secretary
EXHIBIT D.3
TO THE DEPARTMENT OF PUBLIC UTILITY CONTROL
OF THE STATE OF CONNECTICUT
APPLICATION OF PUBLIC SERVICE COMPANY OF NEW HAMPSHIRE
FOR A WAIVER OF THE REQUIREMENTS OF
C.G.S. SECTION 16-43 WITH RESPECT TO AMENDMENT AND
EXTENSION OF REVOLVING CREDIT FACILITY
I. INTRODUCTION
1. Public Service Company of New Hampshire ("PSNH"), a "foreign
electric company" within the meaning of Section 16-246a of the Connecticut
General Statutes, hereby applies to the Connecticut Department of Public
Utility Control (the "Department") for an order pursuant to Section 16-
246c(c) of the General Statutes waiving the requirements of Section 16-43
with respect to the amendment and extension of the term of the Revolving
Credit Agreement dated as of May 1, 1991 among PSNH, the banks named therein
(the "Banks"), Bankers Trust Company, Chemical Bank and Citibank, N.A., as
Co-Agents, and Chemical Bank, as Administrative Agent (the "Revolving Credit
Agreement").
2. PSNH is domiciled in and organized under the laws of the State
of New Hampshire and is authorized under such laws to generate, transmit,
distribute and sell electricity in that state. PSNH currently owns an
undivided 2.8475 percent interest as a tenant-in-common in Millstone Unit No.
3, a nuclear generating unit in the Town of Waterford, Connecticut, but it is
not engaged in the business of supplying retail electric service in
Connecticut. As a result of its ownership interest in Millstone Unit No. 3,
pursuant to the provisions of Section 16-246a and 16-246c(c) of the
Connecticut General Statutes, PSNH constitutes a "public service company" in
<PAGE>
the State of Connecticut and is subject to certain jurisdiction of the
Department under Title 16 of the Connecticut General Statutes.
3. On July 31, 1990, PSNH submitted an application to the
Department requesting, among other things, that the Department waive the
requirements of Section 16-43 with respect to the issuance of certain
securities and certain bank financings as part of the first step ("Step One")
of Northeast Utilities' proposed acquisition of PSNH. As part of its July
31, 1990 application, PSNH described the revolving credit facility which
ultimately became documents in the Revolving Credit Agreement.
4. On August 29, 1990, the Department issued its Decision pursuant
to Section 16-246c(c) of the Connecticut General Statutes waiving the
requirements of Section 16-43 with respect to the Step One transactions
subject to the condition that the securities and other transactions conform
to the Third Amended Joint Plan of Reorganization for PSNH (the "Plan") and
with the Order dated July 20, 1990 by the New Hampshire Public Utilities
Commission ("NHPUC") and any supplemental order thereto.
II. DESCRIPTION OF THE PROPOSED AMENDMENT AND EXTENSION OF THE
REVOLVING CREDIT AGREEMENT
5. Pursuant to the Plan and as part of the Step One financing,
PSNH entered into the Revolving Credit Agreement with the Banks. Under the
Revolving Credit Agreement, PSNH has commitments from the Banks for an
aggregate of $125 million<F1>
in short-term borrowings. PSNH's obligations
under the Revolving Credit Agreement are secured by a second mortgage on
certain of PSNH's assets. PSNH pays quarterly to each participating bank a
facility fee (the "Facility Fee") equal to 25 basis points per annum of that
<F1>
The amount of the
commitments was reduced from $200 million to $125 million at the
time of Northeast Utilities' acquisition of PSNH.
<PAGE>
Bank's commitment, and it pays an agency fee to each of the co-agents and the
administrative agent as agreed to from time to time. The Revolving Credit
Agreement currently expires on May 14, 1994. As PSNH explored various
options available to replace the facility under the Revolving Credit
Agreement, it became apparent that the terms of the Revolving Credit
Agreement are as favorable to PSNH as any terms PSNH could expect to receive
the term of the present Revolving Credit Agreement for two more years, to May
14, 1996. This extension will result in the matching of the expiration date
of the Revolving Credit Agreement with the May 14, 1996 expiration date of
PSNH's Term Credit Agreement dated as of May 1, 1991 with the same group of
Banks (the "Term Credit Agreement"). It will also result in significant
transaction cost savings because PSNH will not need to negotiate and draft
entirely new documents.
6. In addition to an extension of the expiration date to May 14,
1996, the operating income to expense ratio and common equity to total
capitalization ratio requirements included in the Revolving Credit Agreement
will be extended for the period May 14, 1994 through May 14, 1996, and will
confirm to the corresponding requirements in the Term Credit Agreement. In
addition, the Facility Fee charged to PSNH may be increased from 25 basis
points per annum ($312,500 in the aggregate) to a higher amount that has no
yet been negotiated, but will not exceed a maximum of 37.5 basis points per
annum ($468,750 in the aggregate). In consideration of the extension, the
Banks will charge PSNH an extension fee that has not yet been negotiated but
will not exceed 15 basis points of their respective commitments under the
Revolving Credit Agreement, or up to $187,500 in the aggregate.
III. REQUEST FOR WAIVER OF SECTION 16-43 WITH RESPECT TO THE
AMENDMENT AND EXTENSION OF THE REVOLVING CREDIT AGREEMENT
<PAGE>
7. Section 16-246c(c) of the Connecticut General Statutes provides
that the Department may waive the requirements of Section 16-43 with respect
to the proposed amendment and extension of the Revolving Credit Agreement
upon a determination that authority over the amendment and extension has been
exercised by the State of New Hampshire. PSNH has applied to the NHPUC for
approval of the amendment and extension of the Revolving Credit Agreement and
will provide the Department with a copy of the NHPUC's approval as soon as it
is available. PSNH respectfully requests that after receipt thereof, the
Department issue an order pursuant to Section 16-246c(c) waiving the
requirements of Section 16-43 with respect to the amendment and extension of
the Revolving Credit Agreement.
IV. CORRESPONDENCE
8. PSNH requests that correspondence with respect to this
Application be sent to the following persons:
John B. Keane, Vice President and Treasurer
Northeast Utilities Service Company
Selden Street
Berlin, Connecticut 06037
Telephone: 665-3541
and
Richard C. MacKenzie, Esq.
Day, Berry & Howard
CityPlace
Hartford, Connecticut 06103-3499
Telephone: 275-0204
Dated this ____ day of ______, 1994.
Respectfully submitted,
PUBLIC SERVICE COMPANY OF
NEW HAMPSHIRE
<PAGE>
By:
Richard C. MacKenzie
For Day, Berry & Howard
CityPlace
Hartford, CT 06103-3499
Its Attorneys
EXHIBIT D.4
STATE OF CONNECTICUT
DEPARTMENT OF PUBLIC UTILITY CONTROL
ONE CENTRAL PARK PLAZA
NEW BRITAIN, CT 06051
DOCKET NO. 94-03-21 APPLICATION OF PUBLIC SERVICE COMPANY OF NEW
HAMPSHIRE FOR WAIVER OF THE REQUIREMENTS OF CGS
SECTION 16-43 WITH RESPECT TO AMENDMENT AND
EXTENSION OF REVOLVING CREDIT FACILITY
April 27, 1994
By the following Commissioners
Evan W. Woollacott
Thomas M. Benedict
Reginald J. Smith
DRAFT DECISION
I. INTRODUCTION
On August 29, 1990, the Department of Public Utility Control
(Department) issued a Decision in Docket No. 90-07-24 which waived the
requirements of *16-43 of the General Statutes of Connecticut (Conn. Gen.
Stat.) with respect to the issue of securities associated with the
reorganization and financial restructuring of Public Service Company of New
Hampshire (PSNH), an electric utility incorporated under the laws of the
State of New Hampshire and a foreign electric company within the meaning of
Conn. Gen. Stat. *16-246c(c), in connection with the first step of the
acquisition of PSNH by Northeast Utilities. This waiver was subject to the
condition that the securities conform with the Order dated July 20, 1990, by
the New Hampshire Public Utilities Commission (NHPUC) and any Supplemental
Order thereto. As part of the application in Docket No. 92-07-24, PSNH
described the revolving credit facility which ultimately became documented in
the Revolving Credit Agreement dated as of May 1, 1991 (Revolving Credit
Agreement).
On September 9, 1992, the Department issued a Decision in the same
docket, pursuant to Conn. Gen. Stat. *16-246c(c), which waived the approval
requirements of Conn. Gen. Stat. *16-43 with respect to the substitution of
the letter of credit as proposed by PSNH.
By application filed with the Department on March 9, 1994, in the
instant docket, PSNH requested this Department's waiver, pursuant to Conn.
Gen. Stat. *16-246c(c), of the approval requirements of Conn. Gen. Stat. *16-
43 with respect to the amendment and extension of the term of the Revolving
Credit Agreement.
<PAGE>
There was no statutory requirement for a hearing and none was held.
II. APPLICANT'S EVIDENCE
PSNH is proposing to amend and extend the term of the Revolving Credit
Agreement until May 14, 1996. PSNH owns a 2.8475% undivided interest as
tenant-in-common in Millstone Unit No. 3. Therefore, pursuant to the
provisions of Conn. Gen. Stat. *16-246c(c), PSNH constitutes a foreign
electric company and is subject to the approval requirements of Conn. Gen.
Stat. *16-43 with respect to the proposed amendment. PSNH requests that the
Department waive the requirements of Conn. Gen. Stat. *16-43, pursuant to
Conn. Gen. Stat. *16-246c(c), which allows the Department to grant such
waiver upon its determination that the authority over such amendment has been
exercised by the state of domicile of such foreign electric company. PSNH
provided a copy of the Order from the NHPUC, dated April 4, 1994, approving
the amendment and extension of the Revolving Credit Agreement.
III. CONCLUSION
Pursuant to Conn. Gen. Stat. *16-246c(c), the Department hereby waives
the requirements of Conn. Gen. Stat. *16-43 with respect to the amendment and
extension of the term of the Revolving Credit Agreement.
Exhibit F
OPINION OF DAY, BERRY & HOWARD,
COUNSEL FOR PUBLIC SERVICE COMPANY OF NEW HAMPSHIRE
May 2, 1994
Securities and Exchange Commission
450 Fifth Street
Judiciary Plaza
Washington, D.C. 20549
Re: Public Service Company of New Hampshire
File No. 70-8367
Ladies and Gentlemen:
We have acted as counsel to Public Service Company of New Hampshire in
connection with those transactions contemplated by the above-referenced
declaration, as amended (the "Declaration"). This opinion is given to you
with respect to such transactions pursuant to your Instructions as to
Exhibits to applications and declarations filed on Form U-1. Except as
otherwise defined herein, terms used herein shall have the meanings given
them in the Declaration.
We have examined such documents, corporate records and other instruments
as we have deemed necessary or advisable for the purposes of this opinion.
We have assumed the authenticity of all documents submitted to us as
originals, the genuineness of all signatures, the legal capacity of natural
persons and the conformity to originals of documents submitted to us a
copies.
The opinions set forth herein are qualified in their entirety as
follows: (a) every opinion rendered herein is expressly subject to the
consummation of such transactions in accordance with the Declaration; (b) no
opinion is expressed as to any laws other than the federal laws of the United
States and the laws of the States of Connecticut, New Hampshire, Vermont and
Maine; (c) as to all matters of New Hampshire law, we have relied solely upon
the most recent draft of the opinion of Pierre O. Caron, Assistant General
Counsel for PSNH, as to all matters of Vermont law, we have relied solely
upon the most recent draft of the opinion of Zuccaro, Willis & Bent, and as
to all matters of Maine law, we have relied upon the most recent draft of the
opinion of Drummond, Woodsum, Plimpton & MacMahon, and we express no opinion
as to such matters except to the extent covered by such opinions and subject
to the qualifications and assumptions contained in such opinions; (d) the
opinion expressed in paragraph 4 is based solely upon the opinion of Pierre
O. Caron, Assistant General Counsel for PSNH, and we express no opinion as to
such matters except to the extent covered by such opinion and subject to the
qualifications and assumptions contained in such opinion; and (e) insofar as
any opinion relates to the Certificate of Incorporation or Bylaws of PSNH, we
have assumed that that Certificate and those Bylaws will not be amended
between now and the time the transactions contemplated by the Declaration are
consummated.
Based on and subject to the foregoing, we are of the opinion that:
<PAGE>
1. All state laws applicable to the consummation of the transactions
contemplated by the Declaration will have been complied with at the time
those transactions are consummated.
2. PSNH is validly incorporated and duly existing.
3. The proposed amendment to the Revolving Credit Agreement described
in the Declaration will be the valid and binding obligation of PSNH in
accordance with the terms thereof.
4. The consummation of the transactions contemplated by the
Declaration will not violate the legal rights of the holders of any
securities issued by PSNH or any associate company thereof.
This opinion may be relied on by the Commission in connection with the
preparation of its decision in this matter.
Very truly yours,
/s/ Day, Berry & Howard
RCM:PNB
WARNING: THE EDGAR SYSTEM ENCOUNTERED ERROR(S) WHILE PROCESSING THIS SCHEDULE.
<TABLE> <S> <C>
EXHIBIT J
PUBLIC SERVICE COMPANY OF NEW HAMPSHIRE
CALCULATION OF COMMON EQUITY PERCENTAGE
AS DEFINED IN REVOLVING CREDIT AGREEMENT
(THOUSANDS OF DOLLARS)
<CAPTION>
ACTUAL FORECAST FORECAST
12/31/93 6/30/94 13/31/94
<S> <C> <C> <C>
CAPITALIZATION AND LIABILITIES
CAPITALIZATION
COMMON SHARES $1 $1 $1
CAPITAL SURPLUS, PAID IN 421,245 421,245 421,245
RETAINED EARNINGS 60,840 71,488 94,357
_______ _______ _______
TOTAL COMMON STOCKHOLDER EQUITY 482,086 492,734 515,603
PREFERRED STOCK SUBJECT TO
MANDATORY REDEMPTION 125,000 125,000 125,000
LONG TERM DEBT 999,985 952,985 905,985
LONG-TERM DEBT CURRENT PORTION 94,000 94,000 94,000
SHORT-TERM DEBT 2,500 0 0
_______ _______ _______
TOTAL CAPITALIZATION 1,703,571 1,664,719 1,640,588
COMMON EQUITY TO TOTAL CAPITALIZATION 28.3% 29.6% 31.4%
PUBLIC SERVICE COMPANY OF NEW HAMPSHIRE
CALCULATION OF COMMON EQUITY PERCENTAGE
AS TRADITIONALLY DEFINED BY NORTHEAST UTILITIES
(THOUSANDS OF DOLLARS)
CAPITALIZATION AND LIABILITIES
CAPITALIZATION
COMMON SHARES $1 $1 $1
CAPITAL SURPLUS, PAID IN 421,245 421,245 421,245
RETAINED EARNINGS 60,840 71,488 94,357
_______ _______ _______
TOTAL COMMON STOCKHOLDER EQUITY 482,086 492,734 515,603
PREFERRED STOCK SUBJECT TO
MANDATORY REDEMPTION 125,000 125,000 125,000
LONG TERM DEBT 999,985 952,985 905,985
LONG-TERM DEBT CURRENT PORTION 94,000 94,000 94,000
OPERATING LEASES, NET 4,359 4,363 4,363
_______ _______ _______
TOTAL CAPITALIZATION 1,705,430 1,669,082 1,644,951
COMMON EQUITY TO TOTAL CAPITALIZATION 28.3% 29.5% 31.3%
</TABLE>
