<PAGE>1
SECURITIES AND EXCHANGE COMMISSION
Washington, D. C. 20549
FORM 10-Q/A
(Mark One)
[X] QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE
SECURITIES EXCHANGE ACT OF 1934
For the quarterly period ended March 31, 1996
or
[ ] TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE
SECURITIES EXCHANGE ACT OF 1934
Commission file number 2 - 26720
LOUISVILLE GAS AND ELECTRIC COMPANY
(Exact name of registrant as specified in its charter)
Kentucky 61 - 0264150
(State or other jurisdiction of (I.R.S. Employer
incorporation or organization) Identification No.)
220 West Main Street 40232
P.O. Box 32010 (Zip Code)
Louisville, KY
(Address of principal executive offices)
(502) 627-2000
(Registrant's telephone number)
Indicate by check mark whether the registrant (1) has filed all reports
required to be filed by Section 13 or 15(d) of the Securities Exchange Act of
1934 during the preceding 12 months (or for such shorter period that the
registrant was required to file such reports), and (2) has been subject to such
filing requirements for the past 90 days. Yes X No
Indicate the number of shares outstanding of each of the issuer's classes of
common stock, as of the latest practicable date. 21,294,223 shares, without
par value, as of April 30, 1996, all of which were held by LG&E Energy Corp.
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The Company is filing this amendment to its Form 10-Q for the quarter ended
March 31, 1996 (the "Form 10-Q"), to (i) amend the description of Exhibit 10.01
that appeared under Item 6(a) of the Form 10-Q to delete all references to a
confidential treatment request filed with the Securities and Exchange
Commission on behalf of the Company, and (ii) to file Exhibit 10.01 in complete
and unredacted form. The amended version of Item 6 is included in this filing.
Item 6(a). Exhibits.
Exhibit No. Description
10.01 Copy of the Credit Agreement, dated December 18, 1995, by and among the
Company, the Banks party thereto, PNC Bank, Kentucky, Inc. as Agent and
Bank of Montreal as Co-Agent.
27. Financial Data Schedule
Item 6(b). Reports on Form 8-K.
None.
SIGNATURES
Pursuant to the requirements of the Securities and Exchange Act of 1934, the
registrant has duly caused this report to be signed on its behalf by the
undersigned thereunto duly authorized.
LOUISVILLE GAS AND ELECTRIC COMPANY
Registrant
Date: July 19, 1996 Walter Z. Berger
---------------------------------------
Walter Z. Berger
Executive Vice President and
Chief Financial Officer
(On behalf of the registrant in his
capacity as Principal Accounting Officer)
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EXHIBIT 10.01
CREDIT AGREEMENT
by and among
LOUISVILLE GAS AND ELECTRIC COMPANY
and
THE BANKS PARTY HERETO
and
PNC BANK, KENTUCKY, INC., as Agent
and
BANK OF MONTREAL, as Co-Agent
Dated as of December 18, 1995
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CREDIT AGREEMENT
THIS CREDIT AGREEMENT (the "Agreement") is dated as of
December 18, 1995, and is made by and among LOUISVILLE GAS AND
ELECTRIC COMPANY, a Kentucky corporation (the "Borrower"), the
BANKS (as hereinafter defined), PNC BANK, KENTUCKY, INC., a
Kentucky banking corporation, in its capacity as agent for the
Banks under this Agreement (hereinafter referred to in such
capacity as the "Agent") and BANK OF MONTREAL, in its capacity as
co-agent for the Banks under this Agreement (hereinafter referred
to in such capacity as the "Co-Agent").
WITNESSETH:
WHEREAS, the Borrower has requested the Banks to
provide an unsecured revolving credit facility to the Borrower in
an aggregate principal amount not to exceed $160,000,000; and
WHEREAS, the unsecured revolving credit facility shall
be used for general corporate purposes, including without
limitation, providing a source of funds to be available for the
payment, when and if due, of the purchase price of the Bonds (as
hereinafter defined); and
WHEREAS, the Banks are willing to provide such credit
upon the terms and conditions hereinafter set forth.
NOW, THEREFORE, the parties hereto, in consideration of
their mutual covenants and agreements hereinafter set forth and
intending to be legally bound hereby and for other good and
valuable consideration, the receipt and mutuality of which is
hereby acknowledged, covenant and agree as follows:
ARTICLE I
CERTAIN DEFINITIONS
1.01 Certain Definitions. In addition to words and
terms defined elsewhere in this Agreement, the following words
and terms shall have the following meanings, respectively, unless
the context hereof clearly requires otherwise:
Affiliate as to any Person shall mean any other
Person (i) which directly or indirectly controls, is controlled
by, or is under common control with such Person, (ii) which
beneficially owns or holds 5% or more of any class of the voting
or other equity interests of such Person, or (iii) 5% or more of
any class of voting interests or other equity interests of which
is beneficially owned or held, directly or indirectly, by such
Person. Control, as used in this definition, shall mean the
possession, directly or indirectly, of the power to direct or
cause the direction of the management or policies of a Person,
whether through the ownership of voting securities, by contract
or otherwise, including the power to elect a majority of the
directors or trustees of a corporation or trust, as the case may
be.
Agent shall mean PNC Bank, Kentucky, Inc., and its
successors and permitted assigns.
Agent's Fee shall have the meaning assigned to
that term in Section 10.15.
Agreement shall mean this Credit Agreement as the
same may be supplemented or amended from time to time, including
all schedules and exhibits.
Annual Statements shall have the meaning assigned
to that term in Section 6.01(i)(A).
Assignment and Assumption Agreement shall mean an
Assignment and Assumption Agreement by and among a Purchasing
Bank, the Transferor Bank and the Agent, as Agent and on behalf
of the other Banks, substantially in the form of Exhibit 1.01(A).
Authorized Officers shall mean those individuals
designated by written notice to the Agent from the Borrower
authorized to execute notices, certificates, reports and other
documents on behalf of the Borrower required hereunder or under
the other Loan Documents. The Borrower may amend such list of
individuals from time to time by giving written notice of such
amendment to the Agent.
Banks shall mean the financial institutions named
on Schedule 1.01(B) and their respective successors and assigns
as permitted hereunder, each of which is referred to herein as a
Bank.
Base Rate shall mean the greater of (i) the
interest rate per annum announced from time to time by PNC Bank
at its Principal Office as its then prime rate, which rate may
not be the lowest rate then being charged commercial borrowers by
PNC Bank, or (ii) the Federal Funds Effective Rate plus 1/2% per
annum.
Base Rate Option shall mean the option of the
Borrower to have Revolving Credit Loans bear interest at the rate
and under the terms and conditions set forth in Section
4.01(a)(i).
Benefit Arrangement shall mean at any time an
"employee benefit plan," within the meaning of Section 3(3) of
ERISA, which is neither a Plan nor a Multiemployer Plan and which
is maintained, sponsored or otherwise contributed to by any
member of the ERISA Group.
Bid shall have the meaning assigned to such term
in Section 3.02.
Bid Loan Banks shall have the meaning set forth in
Section 9.03.
Bid Loan Euro-Rate Option shall mean the option of
the Borrower to request Bid Loans bearing interest at the Euro-
Rate plus or minus a Margin offered by any of the Banks under the
terms and conditions set forth in Sections 3.01 and 3.02.
Bid Loan Fixed Rate Option shall mean the option
of the Borrower to have Bid Loans bearing interest at a fixed
rate per annum offered by any of the Banks under terms and
conditions set forth in Sections 3.01 and 3.02.
Bid Loan Interest Period shall have the meaning
assigned to such term in Section 3.01.
Bid Loan Notes shall mean collectively, and Bid
Loan Note shall mean separately, all of the Bid Loan Notes of the
Borrower in the form of Exhibit 1.01(B) evidencing the Bid Loans,
together with all amendments, extensions, renewals, replacements,
refinancings or refunds thereof in whole or in part.
Bid Loan Processing Fee shall have the meaning
given to such term in Section 10.15.
Bid Loan Request shall have the meaning assigned
to such term in Section 3.01.
Bid Loans shall mean collectively, and Bid Loan
shall mean separately, all of the Euro-Rate Bid Loans or Fixed
Rate Bid Loans or any Euro-Rate Bid Loans or Fixed Rate Bid Loans
made by any of the Banks to the Borrower pursuant to Sections
3.01 and 3.02.
Bonds shall mean (i) $31,000,000 County of
Jefferson, Kentucky, Pollution Control Revenue Bonds, 1992 Series
A (Louisville Gas and Electric Company Project), (ii) $60,000,000
County of Trimble, Kentucky, Pollution Control Revenue Bonds,
1992 Series A (Louisville Gas and Electric Company Project), and
(iii) $35,200,000 County of Jefferson, Kentucky, Pollution
Control Revenue Bonds, 1993 Series A (Louisville Gas and Electric
Company Project).
Borrower shall mean Louisville Gas and Electric
Company, a corporation organized and existing under the laws of
the Commonwealth of Kentucky.
Borrower Debt Rating shall mean the ratings of the
Borrower's Secured Public Indebtedness provided by Standard &
Poor's and Moody's. As of the Closing Date, each of the ratings
of Moody's listed below is deemed to be equivalent to the rating
of Standard & Poor's listed next to it:
Equivalent
Rating of
Moody's Standard & Poor's
Aa2 AA
Aa3 AA-
A1 A+
A2 A
A3 A-
Baa1 BBB+
Baa2 BBB
Baa3 BBB-
If the ratings of the Borrower's Secured Public Indebtedness
provided by Standard & Poor's and Moody's are not at any time
equivalent, for the purposes of determining the Borrower Debt
Rating, the higher rating will apply, provided that if the
difference in ratings is greater than one (1) level, the average
of the two (2) ratings will apply.
It is acknowledged that the Borrower Debt Rating on the Closing
Date is Aa2/AA.
Borrowing Date shall mean, with respect to any
Loan, the date for the making thereof or the conversion thereof
to a different Interest Rate Option, which shall be a Business
Day.
Borrowing Tranche shall mean specified portions of
Loans outstanding as follows: (i) any Revolving Credit Loans to
which a Euro-Rate Option applies which become subject to the same
Interest Rate Option under the same Revolving Credit Loan Request
by the Borrower and which have the same Interest Period shall
constitute one Borrowing Tranche, (ii) all Revolving Credit Loans
to which a Base Rate Option applies shall constitute one
Borrowing Tranche, (iii) any Euro-Rate Bid Loans requested under
the same Bid Loan Request and having the same Interest Period
shall constitute one Borrowing Tranche, and (iv) any Fixed Rate
Bid Loans requested under the same Bid Loan Request and having
the same Interest Period shall constitute one Borrowing Tranche.
Business Day shall mean any day other than a
Saturday or Sunday or a legal holiday on which commercial banks
are authorized or required to be closed for business in
Louisville, Kentucky or New York City, New York and, if the
applicable Business Day relates to any Loans to which the Euro-
Rate Option applies, such day must also be a day on which
dealings in Dollar deposits are carried on in the London
interbank market.
Closing Date shall mean December 18, 1995.
Co-Agent shall mean Bank of Montreal.
Commitment shall mean as to any Bank at any time
the amount initially set forth opposite its name on Schedule
1.01(B) in the column labeled "Commitment" and thereafter on
Schedule I to the most recent Assignment and Assumption Agreement
to which such Bank is a party, and Commitments shall mean the
aggregate Commitments of all of the Banks.
Dollar, Dollars, U.S. Dollars and the symbol $
shall mean lawful money of the United States of America.
Environmental Conditions shall mean any conditions
of the environment, including the workplace, the ocean, natural
resources (including flora or fauna), soil, surface water, ground
water, any actual or potential drinking water supply sources,
substrata or the ambient air, relating to or arising out of, or
caused by, the use, handling, storage, treatment, recycling,
generation, transportation, release, spilling, leaking, pumping,
emptying, discharging, injecting, escaping, leaching, disposal,
dumping, threatened release or other management or mismanagement
of Regulated Substances resulting from the use of, or operations
on, the Property.
Environmental Laws shall mean all federal, state
and local Laws and regulations, including permits, licenses,
authorizations, bonds, orders, judgments, consent decrees issued,
or entered into, pursuant thereto, relating to pollution or
protection of human health or the environment or employee safety
in the workplace.
ERISA shall mean the Employee Retirement Income
Security Act of 1974, as the same may be amended or supplemented
from time to time, and any successor statute of similar import,
and the rules and regulations thereunder, as from time to time in
effect.
ERISA Group shall mean, at any time, the Borrower
and all members of a controlled group of corporations and all
trades or businesses (whether or not incorporated) under common
control and all other entities which, together with the Borrower,
are treated as a single employer under Section 414 of the
Internal Revenue Code.
Euro-Rate shall mean with respect to the Loans
comprising any Borrowing Tranche to which either the Revolving
Credit Euro-Rate Option or Bid Loan Euro-Rate Option applies for
any Interest Period, the interest rate per annum determined by
the Agent by dividing (the resulting quotient rounded upward to
the nearest 1/16th of 1% per annum) (i) the rate of interest
determined by the Agent in accordance with its usual procedures
(which determination shall be conclusive absent manifest error)
to be the average of the London interbank offered rates set forth
on the "LIBO" page of the Reuters Monitor Money Rate Service (or
appropriate successor or, if Reuters or its successor ceases to
provide such quotes, a comparable replacement determined by the
Agent) at approximately 11:00 a.m. London time two (2) Business
Days prior to the first day of such Interest Period for an amount
comparable to such Borrowing Tranche and having a borrowing date
and a maturity comparable to such Interest Period by (ii) a
number equal to 1.00 minus the Euro-Rate Reserve Percentage. The
Euro-Rate may also be expressed by the following formula:
Average of London interbank offered rates
on LIBO page of Reuters Monitor Money Rate
Euro-Rate Service or appropriate successor
1.00 - Euro-Rate Reserve Percentage
The Euro-Rate shall be adjusted with respect to any Euro-Rate
Option outstanding on the effective date of any change in the
Euro-Rate Reserve Percentage as of such effective date. The
Agent shall give prompt notice to the Borrower and the Banks of
the Euro-Rate as determined or adjusted in accordance herewith,
which determination shall be conclusive absent manifest error.
Euro-Rate Bid Loan shall have the meaning set
forth in Section 3.01.
Euro-Rate Option shall mean either the Revolving
Credit Euro-Rate Option or the Bid Loan Euro-Rate Option.
Euro-Rate Reserve Percentage shall mean the
maximum percentage (expressed as a decimal rounded upward to the
nearest 1/100 of 1%) as determined by the Agent which is in
effect during any relevant period, as prescribed by the Board of
Governors of the Federal Reserve System (or any successor) for
determining the reserve requirements (including supplemental,
marginal and emergency reserve requirements) with respect to
eurocurrency funding (currently referred to as "Eurocurrency
Liabilities") of a member bank in such System.
Event of Default shall mean any of the Events of
Default described in Section 9.01.
Expiration Date shall mean, with respect to the
Commitments, December 17, 2000.
Facility Fees shall mean the fees referred to in
Section 2.03.
Federal Funds Effective Rate for any day shall
mean the rate per annum (based on a year of 365 or 366 days, as
the case may be, and actual days elapsed and rounded upward to
the nearest 1/100 of 1%) announced by the Federal Reserve Bank of
New York (or any successor) on such day as being the weighted
average of the rates on overnight Federal funds transactions
arranged by Federal funds brokers with members of the Federal
Reserve System on the previous trading day, as computed and
announced by such Federal Reserve Bank (or any successor) in
substantially the same manner as such Federal Reserve Bank
computes and announces the weighted average it refers to as the
"Federal Funds Effective Rate" as of the date of this Agreement;
provided, if such Federal Reserve Bank (or its successor) does
not announce such rate on any day, the "Federal Funds Effective
Rate" for such day shall be the Federal Funds Effective Rate for
the last day on which such rate was announced.
FERC shall mean the Federal Energy Regulatory
Commission.
FERC Order shall have the meaning given such term
in Section 6.01(m).
First-Level Debt Rating shall mean a Borrower Debt
Rating of AA- or higher if the rating is provided by Standard &
Poor's or Aa3 or higher if the rating is provided by Moody's.
First Mortgage Bond Indenture shall mean the Trust
Indenture dated November 1, 1949, from the Borrower to Harris
Trust and Savings Bank, as Trustee, and any and all supplemental
indentures thereto, as further amended and supplemented from time
to time.
Fixed Rate Bid Loan shall have the meaning set
forth in Section 3.01.
Fourth-Level Debt Rating shall mean a Borrower
Debt Rating of BBB- or lower if the rating is provided by
Standard & Poor's or Baa3 or lower if the rating is provided by
Moody's.
GAAP shall mean generally accepted accounting
principles as are in effect from time to time, subject to the
provisions of Section 1.03, and applied on a consistent basis
(other than any changes as to which the accountants concur) both
as to classification of items and amounts.
Guarantor shall mean each Subsidiary of the
Borrower which joins this Agreement as a Guarantor after the date
hereof pursuant to Section 11.18.
Guarantor Joinder shall mean a joinder by a
Subsidiary of the Borrower as a Guarantor under this Agreement,
the Guaranty Agreement and the other Loan Documents in the form
of Exhibit 1.01(G)(1);
Guaranty of any Person shall mean any obligation
of such Person guaranteeing or in effect guaranteeing any
liability or obligation of any other Person in any manner,
whether directly or indirectly, including any agreement to
indemnify or hold harmless any other Person, any performance bond
or other suretyship arrangement and any other form of assurance
against loss, except endorsement of negotiable or other
instruments for deposit or collection in the ordinary course of
business.
Guaranty Agreement shall mean a Guaranty and
Suretyship Agreement from the Guarantors in favor of the Agent
and the Banks in the form of Exhibit 1.01(G)(2).
Historical Statements shall have the meaning
assigned to that term in Section 6.01(i)(A).
Indebtedness shall mean as to any Person at any
time, any and all indebtedness, obligations or liabilities
(whether matured or unmatured, liquidated or unliquidated, direct
or indirect, absolute or contingent, or joint or several) of such
Person for or in respect of: (i) borrowed money,
(ii) contingent or matured reimbursement obligations under any
letter of credit, currency swap agreement, interest rate swap,
cap, collar or floor agreement or other interest rate management
device, (iii) any other transaction (including forward sale or
purchase agreements, capitalized leases and conditional sales
agreements) having the commercial effect of a borrowing of money
entered into by such Person to finance its operations or capital
requirements (but not including trade payables and accrued
expenses incurred in the ordinary course of business which are
not represented by a promissory note or other evidence of
indebtedness and which are not more than thirty (30) days past
due), or (iv) any Guaranty of Indebtedness for borrowed money.
Interest Payment Date shall mean each date
specified for the payment of interest in Section 5.03.
Interest Period shall mean, with respect to a
Revolving Credit Loan, a Revolving Credit Interest Period and,
with respect to a Bid Loan, a Bid Loan Interest Period.
Interim Statements shall have the meaning assigned
to that term in Section 6.01(i)(A).
Internal Revenue Code shall mean the Internal
Revenue Code of 1986, as the same may be amended or supplemented
from time to time, and any successor statute of similar import,
and the rules and regulations thereunder, as from time to time in
effect.
Labor Contracts shall mean all employment
agreements, employment contracts, collective bargaining
agreements and other agreements among the Borrower and its
employees.
Law shall mean any law (including common law),
constitution, statute, treaty, regulation, rule, ordinance,
opinion, release, ruling, order, injunction, writ, decree or
award of any Official Body.
Lien shall mean any mortgage, deed of trust,
pledge, lien, security interest, charge or other encumbrance or
security arrangement of any nature whatsoever, whether
voluntarily or involuntarily given, including any conditional
sale or title retention arrangement, and any assignment, deposit
arrangement or lease intended as, or having the effect of,
security and any filed financing statement or other notice of any
of the foregoing (where a lien or other encumbrance is created or
exists at the time of the filing).
Loan shall mean either a Revolving Credit Loan or
a Bid Loan and Loans shall mean collectively the Revolving Credit
Loans and the Bid Loans.
Loan Documents shall mean this Agreement, the Bid
Loan Notes, the Revolving Credit Notes, the Guaranty Agreement,
the Guaranty Joinders and any other instruments, certificates or
documents delivered or contemplated to be delivered hereunder or
thereunder or in connection herewith or therewith, as the same
may be supplemented or amended from time to time in accordance
herewith or therewith, and Loan Document shall mean any of the
Loan Documents.
Loan Parties shall mean the Borrower and the
Guarantors.
Margin shall have the meaning set forth in Section
3.01.
Material Adverse Change shall mean any of the
following events or circumstances: (i) a net loss reflected on
any of the audited consolidated year-end financial statements of
the Borrower and its Subsidiaries, delivered pursuant to Section
8.03(b) hereof, in excess of $25,000,000; (ii) a cumulative net
loss during the term of this Agreement, reflected on the audited
consolidated year-end financial statements of the Borrower and
its Subsidiaries, delivered pursuant to Section 8.03(b) hereof,
in excess of $25,000,000; or (iii) the occurrence of an Event of
Default under Section 9.01(e), (g), (h), (i), (k), (m), or (n)
hereof. For the purposes of the foregoing clauses (i) and (ii),
a "net loss" shall be determined without regard to any loss
resulting from a change in accounting principles.
Month, with respect to an Interest Period under
the Euro-Rate Option, shall mean the interval between the days in
consecutive calendar months numerically corresponding to the
first day of such Interest Period. If any Euro-Rate Interest
Period begins on a day of a calendar month for which there is no
numerically corresponding day in the month in which such Interest
Period is to end, the final month of such Interest Period shall
be deemed to end on the last Business Day of such final month.
Moody's shall mean Moody's Investors Service, Inc.
or any successor.
Multiemployer Plan shall mean any employee benefit
plan which is a "multiemployer plan" within the meaning of
Section 4001(a)(3) of ERISA and to which the Borrower or any
other member of the ERISA Group is then making or accruing an
obligation to make contributions or, within the preceding five
Plan years, has made or had an obligation to make such
contributions.
Multiple Employer Plan shall mean a Plan which has
two or more contributing sponsors (including the Borrower or any
other member of the ERISA Group) at least two of whom are not
under common control, as such a plan is described in Sections
4063 and 4064 of ERISA.
Note shall mean any Revolving Credit Note or Bid
Loan Note.
Notices shall have the meaning assigned to that
term in Section 11.06.
Obligation shall mean any obligation or liability
of the Loan Parties to the Agent or any of the Banks, howsoever
created, arising or evidenced, whether direct or indirect,
absolute or contingent, now or hereafter existing, or due or to
become due, under or in connection with this Agreement, the Notes
or any other Loan Document.
Offered Amount shall have the meaning assigned to
such term in Section 3.02.
Official Body shall mean any national, federal,
state, local or other government or political subdivision or any
agency, authority, bureau, central bank, commission, department
or instrumentality of either, or any court, tribunal, grand jury
or arbitrator, in each case whether foreign or domestic.
PBGC shall mean the Pension Benefit Guaranty
Corporation established pursuant to Subtitle A of Title IV of
ERISA or any successor.
Permitted Liens shall mean:
(i) Liens for taxes, assessments, or similar
charges, incurred in the ordinary course of business and which
are not yet due and payable;
(ii) Pledges or deposits made in the ordinary
course of business to secure payment of workmen's compensation,
or to participate in any fund in connection with workmen's
compensation, unemployment insurance, old-age pensions or other
social security programs;
(iii) Liens of mechanics, materialmen,
warehousemen, carriers, or other like Liens, securing obligations
incurred in the ordinary course of business that are not yet due
and payable and Liens of landlords securing obligations to pay
lease payments that are not yet due and payable or in default;
(iv) Good faith pledges or deposits made in the
ordinary course of business to secure performance of bids,
tenders, contracts (other than for the repayment of borrowed
money) or leases, not in excess of the aggregate amount due
thereunder, or to secure statutory obligations, or surety,
appeal, indemnity, performance or other similar bonds required in
the ordinary course of business;
(v) Encumbrances consisting of zoning
restrictions, easements or other restrictions on the use of real
property, none of which materially impairs the use of such
property or the value thereof, and none of which is violated in
any material respect by existing or proposed structures or land
use;
(vi) Liens on property leased by the Borrower or
any of its Subsidiaries under capital and operating leases
securing obligations of the Borrower or its Subsidiaries to the
lessor under such leases;
(vii) Liens created under or in connection
with the First Mortgage Bond Indenture and Liens permitted by the
First Mortgage Bond Indenture;
(viii) Purchase Money Security Interests;
(ix) The following, (A) if the validity or amount
thereof is being contested in good faith by appropriate and
lawful proceedings diligently conducted so long as levy and
execution thereon have been stayed and continue to be stayed or
(B) if a final judgment is entered and such judgment is
discharged within thirty (30) days of entry, and in the
aggregate, do not materially impair the ability of any Loan Party
to perform its Obligations hereunder or under the other Loan
Documents:
(1) Claims or Liens for taxes,
assessments or charges due and payable and subject to interest or
penalty, provided that the Borrower and its Subsidiaries maintain
such reserves or other appropriate provisions as shall be
required by GAAP and pays all such taxes, assessments or charges
forthwith upon the commencement of proceedings to foreclose any
such Lien;
(2) Claims, Liens or
encumbrances upon, and defects of title to, real or personal
property, including any attachment of personal or real property
or other legal process prior to adjudication of a dispute on the
merits;
(3) Claims or Liens of mechanics,
materialmen, warehousemen, carriers, or other statutory
nonconsensual Liens; or
(4) Liens resulting from adverse
judgments;
(x) Leases, licenses or similar rights to use
property of the Borrower or any of its Subsidiaries whereunder
the Borrower or any of its Subsidiaries is lessor, licensor or
the equivalent thereof upon fair and reasonable terms;
(xi) Liens existing on Property at the time such
Property is acquired by the Borrower or any of its Subsidiaries,
whether or not the Indebtedness secured thereby is assumed by the
Borrower or such Subsidiary;
(xii) Liens existing on Property
of a Person at the time such Person is merged into or
consolidated with the Borrower or any of its Subsidiaries or all
or substantially all of the Property of any Person are sold,
leased or otherwise transferred to the Borrower or any of its
Subsidiaries; or
(xiii) Liens resulting from extensions,
renewals, refinancings and refundings of Indebtedness secured by
any Permitted Liens, provided that there is no increase in the
outstanding principal amount of the Indebtedness secured thereby
and any new Lien attaches only to the same Property theretofore
subject to such earlier Lien.
Person shall mean any individual, corporation,
partnership, association, joint-stock company, trust,
unincorporated organization, joint venture, limited liability
company, government or political subdivision or agency thereof,
or any other entity.
Plan shall mean at any time an employee pension
benefit plan (including a Multiple Employer Plan but not a
Multiemployer Plan) which is covered by Title IV of ERISA or is
subject to the minimum funding standards under Section 412 of the
Internal Revenue Code and either (i) is maintained by any member
of the ERISA Group for employees of any member of the ERISA Group
or (ii) has at any time within the preceding five years been
maintained by any entity which was at such time a member of the
ERISA Group for employees of any entity which was at such time a
member of the ERISA Group.
PNC Bank shall mean PNC Bank, Kentucky, Inc., its
successors and assigns.
Potential Default shall mean any event or
condition which with notice, passage of time or a determination
by the Agent or the Required Banks, or any combination of the
foregoing, would constitute an Event of Default.
Principal Office shall mean the principal banking
office of the Agent in Louisville, Kentucky.
Prohibited Transaction shall mean any prohibited
transaction as defined in Section 4975 of the Internal Revenue
Code or Section 406 of ERISA for which neither an individual nor
a class exemption has been issued by the United States Department
of Labor.
Property shall mean all real property, both owned
and leased, of the Borrower.
Purchase Money Security Interest shall mean a Lien
upon tangible personal property securing loans to the Borrower or
a Subsidiary of the Borrower or deferred payments by the Borrower
or a Subsidiary of the Borrower for the purchase of such tangible
personal property; provided that the amount of Indebtedness
secured thereby does not exceed the purchase price therefor.
Purchasing Bank shall mean a Bank which becomes a
party to this Agreement by executing an Assignment and Assumption
Agreement.
Ratable Share shall mean the proportion that a
Bank's Commitment bears to the Commitments of all of the Banks.
Regulated Substances shall mean any substance,
including any solid, liquid, semisolid, gaseous, thermal,
thoriated or radioactive material, refuse, garbage, wastes,
chemicals, petroleum products, byproducts, coproducts,
impurities, dust, scrap, heavy metals, any substance defined as a
"hazardous substance," "pollutant," "pollution," "contaminant,"
"hazardous or toxic substance," "extremely hazardous substance,"
"toxic chemical," "toxic waste," "hazardous waste," "industrial
waste," "residual waste," "solid waste," "municipal waste,"
"mixed waste," "infectious waste," "chemotherapeutic waste,"
"medical waste," "regulated substance" or any related materials,
substances or wastes as now or hereafter defined pursuant to any
Environmental Laws, ordinances, rules, regulations or other
directives of any Official Body, the generation, manufacture,
extraction, processing, distribution, treatment, storage,
disposal, transport, recycling, reclamation, use, reuse,
spilling, leaking, dumping, injection, pumping, leaching,
emptying, discharge, escape, release or other management or
mismanagement of which is regulated by the Environmental Laws.
Reportable Event means a reportable event
described in Section 4043 of ERISA and regulations thereunder
with respect to a Plan or Multiemployer Plan.
Requested Amount shall have the meaning assigned
to such term in Section 3.01.
Required Banks shall mean (i) prior to a
termination of Commitments hereunder pursuant to Section 9.02,
Banks whose Commitments collectively equal at least 51% of the
Commitments of all of the Banks, and (ii) after a termination of
Commitments hereunder pursuant to Section 9.02, Banks whose
Revolving Credit Loans and Bid Loans collectively equal at least
51% of the total Revolving Credit Loans and Bid Loans
outstanding.
Revolving Credit Euro-Rate Option shall mean the
option of the Borrower to have Revolving Credit Loans bear
interest at the rate and under the terms and conditions set forth
in Section 4.01(a)(ii).
Revolving Credit Euro-Rate Spread shall have the
meaning set forth in Section 4.01(a)(ii).
Revolving Credit Interest Period, for a Revolving
Credit Loan bearing interest at the Euro-Rate, shall have the
meaning given to such term in Section 4.02 and, for a Revolving
Credit Loan bearing interest at the Base Rate, shall mean a
period commencing on the date such Loan is made and ending on the
364th day thereafter, unless such day is not a Business Day in
which case such period shall end on the next preceding day which
is a Business Day; provided, however, that (i) such period shall
not extend beyond the Expiration Date and (ii) the Revolving
Credit Interest Period for a Revolving Credit Loan bearing
interest at the Base Rate that results from the conversion
pursuant to Section 4.04 or 4.05 hereof of a Revolving Credit
Loan bearing interest at the Euro-Rate shall be a period
commencing on the last day of the Interest Period for such
Revolving Credit Loan bearing interest at the Euro-Rate and
ending on the 364th day after the Borrowing Date for such
Revolving Credit Loan bearing interest at the Euro-Rate, unless
such day is not a Business Day in which case such Interest Period
shall end on the next preceding day which is a Business Day.
Revolving Credit Interest Rate Option shall mean
any Revolving Credit Euro-Rate Option or the Base Rate Option.
Revolving Credit Loans shall mean collectively and
Revolving Credit Loan shall mean separately all Revolving Credit
Loans or any Revolving Credit Loan made by the Banks or one of
the Banks to the Borrower pursuant to Section 2.01. A Bid Loan
is not a Revolving Credit Loan, except that it will be treated as
a Revolving Credit Loan following a termination of the
Commitments hereunder pursuant to Section 9.02 as provided in
Section 9.03.
Revolving Credit Loan Request shall mean a request
for Revolving Credit Loans made in accordance with Section 2.04
or a request to select, convert to or renew a Euro-Rate Option in
accordance with Section 4.02.
Revolving Credit Notes shall mean collectively and
Revolving Credit Note shall mean separately all the Revolving
Credit Notes of the Borrower in the form of Exhibit 1.01(R)
evidencing the Revolving Credit Loans together with all
amendments, extensions, renewals, replacements, refinancings or
refundings thereof in whole or in part.
SEC Reports shall have the meaning given to such
term in Section 6.01(g).
Second-Level Debt Rating shall mean a Borrower
Debt Rating of equal to or better than A- but less than AA- if
the rating is provided by Standard & Poor's or equal to or better
than A3 but less than Aa3 if the rating is provided by Moody's.
Secured Public Indebtedness shall mean the secured
unguaranteed public Indebtedness of the Borrower listed on
Schedule 1.01(S) and any other secured or unsecured public
Indebtedness hereafter issued by the Borrower which is issued to
refinance or refund such Indebtedness.
Significant Subsidiary shall have the meaning
given to such term in Regulation S-X of The Securities and
Exchange Commission.
Standard & Poor's shall mean Standard & Poor's
Corporation or any successor.
Subsidiary of any Person at any time shall mean
(i) any corporation or trust of which 50% or more (by number of
shares or number of votes) of the outstanding capital stock or
shares of beneficial interest normally entitled to vote for the
election of one or more directors or trustees (regardless of any
contingency which does or may suspend or dilute the voting
rights) is at such time owned directly or indirectly by such
Person or one or more of such Person's Subsidiaries, or any
partnership of which such Person is a general partner or of which
50% or more of the partnership interests is at the time directly
or indirectly owned by such Person or one or more of such
Person's Subsidiaries, or (ii) any corporation, trust,
partnership or other entity which is controlled by such Person or
one or more of such Person's Subsidiaries.
Third-Level Debt Rating shall mean a Borrower Debt
Rating equal to or better than BBB but less than A- if the rating
is provided by Standard & Poor's or equal to or better than Baa2
but less than A3 if the rating is provided by Moody's.
Transferor Bank shall mean the selling Bank
pursuant to an Assignment and Assumption Agreement.
1.02 Construction. Unless the context of this
Agreement otherwise clearly requires, the following rules of
construction shall apply to this Agreement and each of the other
Loan Documents:
(a) references to the plural include the
singular, the plural, the part and the whole; "or" has the
inclusive meaning represented by the phrase "and/or," and
"including" has the meaning represented by the phrase "including
without limitation";
(b) references to "determination" of or by the
Agent or the Banks shall be deemed to include good faith
estimates by the Agent or the Banks (in the case of quantitative
determinations) and good faith beliefs by the Agent or the Banks
(in the case of qualitative determinations) and such
determination (unless otherwise expressly provided herein) shall
be conclusive absent manifest error;
(c) whenever the Agent or the Banks are granted
the right herein to act in its or their sole discretion or to
grant or withhold consent such right shall be exercised in good
faith;
(d) the words "hereof," "herein," "hereunder,"
"hereto" and similar terms in this Agreement or such other Loan
Document refer to this Agreement or such other Loan Document as a
whole and not to any particular provision of this Agreement or
such other Loan Document;
(e) the section and other headings contained in
this Agreement or such other Loan Document and the Table of
Contents (if any) preceding this Agreement or such other Loan
Document are for reference purposes only and shall not control or
affect the construction of this Agreement or such other Loan
Document or the interpretation thereof in any respect;
(f) article, section, subsection, clause,
schedule and exhibit references are to this Agreement or such
other Loan Document, as the case may be, unless otherwise
specified;
(g) reference to any Person includes such
Person's successors and assigns but, if applicable, only if such
successors and assigns are permitted by this Agreement or such
other Loan Document, as the case may be, and reference to a
Person in a particular capacity excludes such Person in any other
capacity;
(h) reference to any agreement (including this
Agreement and any other Loan Document together with the schedules
and exhibits hereto or thereto), document or instrument means
such agreement, document or instrument as amended, modified,
replaced, substituted for, superseded or restated;
(i) relative to the determination of any period
of time, "from" means "from and including," "to" means "to but
excluding" and "through" means "through and including"; and
(j) references to "shall" and "will" are intended
to have the same meaning.
1.03 Accounting Principle. Except as otherwise
provided in this Agreement, all computations and determinations
as to accounting or financial matters and all financial
statements to be delivered pursuant to this Agreement shall be
made and prepared in accordance with GAAP (including principles
of consolidation where appropriate), and all accounting or
financial terms shall have the meanings ascribed to such terms by
GAAP.
ARTICLE II
REVOLVING CREDIT FACILITY
2.01 Commitments. Subject to the terms and conditions
hereof and relying upon the representations and warranties herein
set forth, each Bank severally agrees to make Revolving Credit
Loans to the Borrower at any time or from time to time on or
after the date hereof to the Expiration Date in an aggregate
principal amount not to exceed at any one time such Bank's
Commitment. Within such limits of time and amount and subject to
the other provisions of this Agreement, the Borrower may borrow,
repay and reborrow pursuant to this Section 2.01.
2.02 Nature of Banks' Obligations with Respect to
Revolving Credit Loans. Each Bank shall be obligated to
participate in each request for Revolving Credit Loans pursuant
to Section 2.05 in accordance with its Ratable Share. The
aggregate of each Bank's Revolving Credit Loans outstanding
hereunder to the Borrower at any time shall never exceed its
Commitment, and the aggregate of the Revolving Credit Loans and
Bid Loans may not exceed the Commitments. The obligations of
each Bank hereunder are several. The failure of any Bank to
perform its obligations hereunder shall not affect the
Obligations of the Borrower to any other party nor shall any
other party be liable for the failure of such Bank to perform its
obligations hereunder. The Banks shall have no obligation to
make Revolving Credit Loans hereunder on or after the Expiration
Date.
2.03 Facility Fees. Accruing from the date hereof
until the Expiration Date, the Borrower agrees to pay to the
Agent for the account of each Bank, as consideration for such
Bank's Commitment hereunder, a nonrefundable facility fee (the
"Facility Fee") equal to the amount of such Bank's Commitment
times a percentage (computed on the basis of a year of 365 or 366
days, as the case may be, and actual days elapsed) which shall be
determined daily based on the Borrower Debt Rating in effect at
such time as follows:
Borrower Debt Rating Facility Fee Rate
First-Level Debt Rating .07%
Second-Level Debt Rating .10%
Third-Level Debt Rating .125%
Fourth-Level Debt Rating .25%
All Facility Fees shall be payable in arrears on the first
Business Day of each April, July, October and January after the
date hereof commencing on April 1, 1996 and on the Expiration
Date or upon acceleration of the Notes.
2.04 Revolving Credit Loan Requests. Except as
otherwise provided herein, the Borrower may from time to time
prior to the Expiration Date request the Banks to make Revolving
Credit Loans, by delivering to the Agent, not later than
(i) 9:00 a.m. Louisville, Kentucky time three (3) Business Days
prior to the proposed Borrowing Date with respect to the making
of Revolving Credit Loans to which the Euro-Rate Option applies;
and (ii) 11:00 a.m. Louisville, Kentucky time on the proposed
Borrowing Date with respect to the making of a Revolving Credit
Loan to which the Base Rate Option applies of a duly completed
request therefor substantially in the form of Exhibit 2.05 or a
request by telephone immediately confirmed in writing by letter,
facsimile or telex in such form (each, a "Revolving Credit Loan
Request"), it being understood that the Agent may rely on the
authority of any individual making such a telephonic request
without the necessity of receipt of such written confirmation,
provided that such individual identifies himself or herself as an
Authorized Officer. Each Revolving Credit Loan Request shall be
irrevocable and shall specify (i) the proposed Borrowing Date;
(ii) the aggregate amount of the proposed Revolving Credit Loans
comprising each Borrowing Tranche, which shall be in integral
multiples of $1,000,000 and not less than $1,000,000 for each
Borrowing Tranche to which the Revolving Credit Euro-Rate Option
applies and not less than the lesser of $500,000 or the maximum
amount available for Borrowing Tranches to which the Base Rate
Option applies; (iii) whether the Euro-Rate Option or Base Rate
Option shall apply to the proposed Revolving Credit Loans
comprising the Borrowing Tranche; and (iv) an appropriate
Interest Period for the Loans comprising such Borrowing Tranche.
2.05 Making Revolving Credit Loans. The Agent shall,
promptly after receipt by it of a Revolving Credit Loan Request
pursuant to Section 2.04, notify the Banks of its receipt of such
Revolving Credit Loan Request specifying: (i) the proposed
Borrowing Date and the time and method of disbursement of such
Revolving Credit Loans; (ii) the amount and type of each such
Revolving Credit Loan and the applicable Interest Period; and
(iii) the apportionment among the Banks of the Revolving Credit
Loans as determined by the Agent in accordance with Section 2.02.
Each Bank shall remit the principal amount of each Revolving
Credit Loan to the Agent such that the Agent is able to, and the
Agent shall, to the extent the Banks have made funds available to
it for such purpose, fund such Revolving Credit Loans to the
Borrower in U.S. Dollars and immediately available funds at the
Principal Office prior to 2:00 p.m. Louisville, Kentucky time on
the Borrowing Date, provided that if any Bank fails to remit such
funds to the Agent in a timely manner, the Agent may elect in its
sole discretion to fund with its own funds the Revolving Credit
Loans of such Bank on the Borrowing Date and such Bank shall be
subject to the repayment obligation in Section 10.16.
Notwithstanding the foregoing provisions of this Section 2.05, to
the extent a Revolving Credit Loan made by a Bank matures on the
Borrowing Date of a requested Revolving Credit Loan or Bid Loan,
such Bank shall apply the proceeds of such Revolving Credit Loan
or Bid Loan it is then making to the repayment of the principal
of the maturing Revolving Credit Loan.
2.06 Revolving Credit Notes and Repayment.
(a) Revolving Credit Notes. The Obligation of
the Borrower to repay the aggregate unpaid principal amount of
the Revolving Credit Loans made to it by each Bank, together with
interest thereon, shall be evidenced by a Revolving Credit Note
dated the Closing Date payable to the order of such Bank in a
face amount equal to the Revolving Credit Commitment of such
Bank.
(b) Repayment. Each Revolving
Credit Loan shall be paid in full by the Borrower on the last day
of the Revolving Credit Interest Period applicable to such Loan,
except that in the event a Revolving Credit Loan bearing interest
at the Euro-Rate is automatically converted pursuant to
Section 4.05 hereof to a Revolving Credit Loan bearing interest
at the Base Rate, such Revolving Credit Loan shall be paid in
full by the Borrower on the last day of the Interest Period
applicable to such Revolving Credit Loan bearing interest at the
Base Rate.
2.07 Use of Proceeds. The proceeds of the Revolving
Credit Loans shall be used for general corporate purposes of the
Borrower, including without limitation, providing a source of
funds to be available for the payment, when and if due, of the
purchase price of the Bonds.
2.08 Reduction of Commitment. The Borrower shall have
the right at any time and from time to time upon five (5)
Business Days' prior written notice to the Agent to permanently
reduce, in minimum amounts of $5,000,000 and whole multiples of
$1,000,000 of principal, or terminate, the Commitments without
penalty or premium, except as hereinafter set forth, provided
that any such reduction or termination shall be accompanied by
the payment in full of any Facility Fee then accrued on the
amount of such reduction or termination and provided that the
amount of Loans outstanding may not exceed the amount of
Commitments after such reduction (any repayment of Loans on or
before the date of such reduction shall be subject to
Section 5.05). From the effective date of any such reduction or
termination, the obligations of the Borrower to pay the Facility
Fee pursuant to Section 2.03 shall correspondingly be reduced or
cease.
ARTICLE III
BID LOANS
3.01 Bid Loan Requests. Except as otherwise provided
herein, the Borrower may from time to time prior to the
Expiration Date request that the Banks make Euro-Rate Bid Loans
or Fixed Rate Bid Loans by delivering to the Agent not later than
9:00 a.m. Louisville, Kentucky time one (1) Business Day prior to
the proposed Borrowing Date if it is a Fixed Rate Bid Loan and
9:00 a.m. Louisville, Kentucky time four (4) Business Days prior
to the proposed Borrowing Date if it is a Euro-Rate Bid Loan of a
duly completed request therefor substantially in the form of
Exhibit 3.01 or a request by telephone immediately confirmed in
writing by letter, facsimile or telex (each, a "Bid Loan
Request"), it being understood that the Agent may rely on the
authority of any individual making such a telephonic request
without the necessity of receipt of such written confirmation,
provided that such individual identifies himself or herself as an
Authorized Officer. Each Bid Loan Request shall be irrevocable
and shall specify the following:
(i) the proposed Borrowing Date;
(ii) whether the Borrower desires that such Bid
Loan bear interest (A) at a fixed rate per annum (which shall be
expressed in the form of a decimal to no more than four places
and computed on a year of 365 or 366 days) specified by the Bank
making such Bid Loan in its Bid (a "Fixed Rate Bid Loan") or (B)
the Euro-Rate plus or minus a margin (the "Margin") (which shall
be expressed as a percentage rate per annum in the form of a
decimal to no more than four decimal places and based on a year
of 360 days) as specified by the Bank making such Bid Loan in its
Bid (a "Euro-Rate Bid Loan");
(iii) the term of the
proposed Bid Loan (the "Bid Loan Interest Period"), which may be
no less than seven (7) days and no longer than two hundred and
seventy (270) days in the case of a Fixed Rate Bid Loan or one,
two, three or six Months in the case of a Euro-Rate Bid Loan and
in either instance, such term may not extend beyond the
Expiration Date; and
(iv) the maximum principal
amount (the "Requested Amount") of such Bid Loan, which shall be
not less than $1,000,000 and shall be an integral multiple of
$1,000,000 if it is a Euro-Rate Bid Loan or an integral multiple
of $100,000 if it is a Fixed Rate Bid Loan. After giving effect
to such Bid Loan and any Revolving Credit Loan made on or before
the Borrowing Date, the aggregate amount of all Revolving Credit
Loans and Bid Loans outstanding shall not exceed the aggregate
amount of the Commitments of the Banks.
3.02 Bidding for, Accepting and Making Bid Loans.
(a) Bidding. The Agent shall
promptly after receipt by it of a Bid Loan Request pursuant to
Section 3.01 notify the Banks of its receipt of such Bid Loan
Request, specifying (i) the proposed Borrowing Date, (ii) the Bid
Loan Interest Period, (iii) the principal amount of the proposed
Bid Loan and (iv) whether such Bid Loan is to be a Euro-Rate Bid
Loan or a Fixed Rate Bid Loan. Each Bank may submit a bid (a
"Bid") to the Agent by telephone (immediately confirmed in
writing in the form of Exhibit 3.02 by letter, facsimile or
telex) not later than 10:00 a.m. Louisville, Kentucky time on the
proposed Borrowing Date specified in the Bid Loan Request in the
case of a Fixed Rate Bid Loan and 10:00 a.m. Louisville, Kentucky
time three (3) Business Days before the proposed Borrowing Date
in the case of a Euro-Rate Bid Loan. Each Bid shall specify:
(A) the principal amount of proposed Bid Loans offered by such
Bank (the "Offered Amount"), which (i) may be less than, but
shall not exceed, the Requested Amount, (ii) shall be at least
$1,000,000 and shall be an integral multiple of $1,000,000 if it
is a Euro-Rate Bid Loan or an integral multiple of $100,000 if it
is a Fixed Rate Bid Loan, and (iii) may exceed such Bank's
Revolving Credit Commitment, and (B) the interest rate in the
case of a Fixed Rate Bid Loan or the Margin in the case of a
Euro-Rate Bid Loan applicable to such proposed Bid Loan offered
by such Bank. If any Bid omits information required hereunder,
the Agent may in its sole discretion attempt to notify the Bank
submitting such Bid. If the Agent so notifies a Bank, such Bank
may resubmit its Bid, provided that it does so prior to
10:00 a.m. Louisville, Kentucky time on the Borrowing Date in the
case of a Fixed Rate Bid Loan or 10:00 a.m. Louisville, Kentucky
time three (3) Business Days before the Borrowing Date in the
case of a Euro-Rate Bid Loan. The Agent shall promptly notify
the Borrower of each Bid provided that the Agent has received
such Bid on or before 10:00 a.m. Louisville, Kentucky time on the
Borrowing Date in the case of a Fixed Rate Bid Loan or 10:00 a.m.
Louisville, Kentucky time three (3) Business Days before the
Borrowing Date in the case of a Euro-Rate Bid Loan. If the Agent
in its capacity as a Bank shall, in its sole discretion, make a
Bid, it shall notify the Borrower of such Bid before 9:30 a.m.
Louisville, Kentucky time on the Borrowing Date in the case of a
Fixed Rate Bid Loan or 9:30 a.m. Louisville, Kentucky time
three (3) Business Days before the Borrowing Date in the case of
a Euro-Rate Bid Loan.
(b) Accepting Bids. The
Borrower shall, in its sole discretion, irrevocably accept or
reject Bids. The Borrower shall notify the Agent of its
acceptance or rejection by telephone (immediately confirmed in
writing by letter, facsimile or telex). If the Borrower elects
to accept any Bids, its acceptance must meet the following
conditions: (1) such acceptance must be received by the Agent by
11:00 a.m. Louisville, Kentucky time on the Borrowing Date if the
Borrower is accepting a Bid for a Fixed Rate Bid Loan and by
11:00 a.m. Louisville, Kentucky time three (3) Business Days
before the Borrowing Date if the Borrower is accepting a Bid for
a Euro-Rate Bid Loan; (2) the total amount which the Borrower
accepts from all Banks must equal or exceed $1,000,000 and be in
an integral multiple of $1,000,000 if it is a Euro-Rate Bid Loan
or an integral multiple of $100,000 if it is a Fixed Rate Bid
Loan and in either instance may not exceed the Requested Amount;
(3) the Borrower must accept Bids based solely on the amount of
the interest rates of each Bid in ascending order of the amount
of such interest rates; (4) the Borrower may not borrow Bid Loans
from any Bank on the relevant Borrowing Date in an amount
exceeding such Bank's Offered Amount; (5) if two (2) or more
Banks make Bids at the same interest rate and the Borrower
desires to accept a portion but not all of the Bids at such
interest rate, the Borrower shall accept a portion of each Bid
equal to the product of the Offered Amount of such Bid times the
fraction obtained by dividing the total amount of Bids which the
Borrower is accepting at such interest rate by the sum of the
Offered Amounts of the Bids at such rate; provided that the
Borrower shall round the Bid Loan allocated to each such Bank
upward or downward as the Borrower may select to an integral
multiple of $500,000 if it is a Euro-Rate Bid Loan or an integral
multiple or $100,000 if it is a Fixed Rate Bid Loan. The Agent
shall (i) promptly notify a Bank that has made a Bid of the
amount of its Bid that was accepted or rejected by the Borrower
and (ii) as promptly as practical notify all of the Banks of all
Bids submitted and those which have been accepted.
(c) Funding Bid Loans. Each
Bank whose Bid or portion thereof is accepted shall remit the
principal amount of its Bid Loan to the Agent by 1:00 p.m.
Louisville, Kentucky time on the Borrowing Date. The Agent shall
make such funds available to the Borrower on or before 2:00 p.m.
on the Borrowing Date, provided that the conditions precedent to
the making of such Bid Loan set forth in Section 7.02 have been
satisfied not later than 10:00 a.m. Louisville, Kentucky time on
the proposed Borrowing Date. The Agent may assume that the
Borrower has satisfied such conditions precedent if the Borrower
has not notified the Agent that the Borrower has not satisfied
any conditions precedent. Notwithstanding the foregoing
provisions of this Section 3.02, to the extent a Bid Loan made by
a Bank matures on the Borrowing Date of a requested Revolving
Credit Loan or Bid Loan from the same Bank, such Bank shall apply
the proceeds of such Revolving Credit Loan or Bid Loan it is then
making to the repayment of the principal of the maturing Bid
Loan.
(d) Several Obligations. The
obligations of the Banks to make Bid Loans after their Bids have
been accepted are several. No Bank shall be responsible for the
failure of any other Bank to make any Bid Loan which another Bank
has agreed to make.
(e) Interest Periods. If any
Bid Loan Interest Period under the Bid Loan Euro-Rate Option is
scheduled to end on a date which is not a Business Day, such Bid
Loan Interest Period shall be extended to the next succeeding
Business Day unless such Business Day falls in the next calendar
month, in which case such Interest Period shall end on the next
preceding Business Day. Each Bid Loan shall be paid in full by
the Borrower on the last day of the Bid Loan Interest Period
applicable to such Bid Loan.
3.03 Bid Loan Notes. The obligation
of the Borrower to repay the aggregate unpaid principal amount of
the Bid Loans made to it by each Bank, together with interest
thereon, shall be evidenced by a Bid Loan Note dated as of the
Closing Date payable to the order of such Bank in a face amount
equal to the aggregate Revolving Credit Commitments of all of the
Banks.
ARTICLE IV
INTEREST RATES
4.01 Interest Rate Options. The Borrower
shall pay interest in respect of the outstanding unpaid principal
amount of each Revolving Credit Loan for the period from and
including the date of such Loan to, but excluding the date such
Loan shall be paid in full, at the rate selected by it from the
Base Rate Option or Euro-Rate Option set forth below applicable
to the Revolving Credit Loans, it being understood that, subject
to the provisions of this Agreement, the Borrower may select
different Interest Rate Options and different Interest Periods to
apply simultaneously to the Revolving Credit Loans comprising
different Borrowing Tranches, provided that there shall not be at
any one time outstanding more than eight (8) Borrowing Tranches
in the aggregate among all the Revolving Credit Loans. If at any
time the designated rate applicable to any Revolving Credit Loan
or Bid Loan made by any Bank exceeds such Bank's highest lawful
rate, the rate of interest on such Bank's Revolving Credit Loan
or Bid Loan shall be limited to such Bank's highest lawful rate.
(a) Revolving Credit
Interest Rate Options. The Borrower shall have the right to
select from the following Interest Rate Options applicable to the
Revolving Credit Loans:
(i) Base Rate Option: A
fluctuating rate per annum (computed on the basis of a year of
365 or 366 days, as the case may be, and actual days elapsed)
equal to the Base Rate, such interest rate to change
automatically from time to time effective as of the effective
date of each change in the Base Rate; or
(ii) Revolving
Credit Euro-Rate Option: A rate per annum (computed on the basis
of a year of 360 days and actual days elapsed) equal to the Euro-
Rate plus a percentage rate per annum (the "Revolving Credit
Euro-Rate Spread") which shall be determined on a daily basis
based on the Borrower Debt Rating in effect at the close of
business on such day as follows:
Borrower Debt Rating Euro-Rating Spread
First-Level Debt Rating .13%
Second-Level Debt Rating .20%
Third-Level Debt Rating .275%
Fourth-Level Debt Rating .375%
The Revolving Credit Euro-Rate Spread applicable to all Loans
outstanding under the Revolving Credit Euro-Rate Option shall
change on the effective date of any change in the Borrower Debt
Rating pursuant to Section 8.01(j).
(b) Rate Quotations. The
Borrower may call the Agent on or before the date on which a
request for a Loan under a Revolving Credit Euro-Rate Option is
to be delivered to receive an indication of the rates then in
effect, but it is acknowledged that such projection shall not be
binding on the Agent or the Banks nor affect the rate of interest
which thereafter is actually in effect when the election is made.
4.02 Interest Periods for Revolving
Credit Loans at the Euro-Rate. At any time when the Borrower
shall select a Revolving Credit Euro-Rate Option, the Borrower
shall notify the Agent thereof at least three (3) Business Days
prior to the effective date of such Revolving Credit Euro-Rate
Option by delivering a Revolving Credit Loan Request. The notice
shall specify an interest period (the "Revolving Credit Interest
Period") during which such Interest Rate Option shall apply, such
Interest Period to be one, two, three or six Months, provided,
that:
(a) any Revolving Credit
Interest Period under the Revolving Credit Euro-Rate Option which
would otherwise end on a date which is not a Business Day shall
be extended to the next succeeding Business Day unless such
Business Day falls in the next calendar month, in which case such
Interest Period shall end on the next preceding Business Day;
(b) each Borrowing Tranche of
Loans subject to any Revolving Credit Euro-Rate Option shall be
in integral multiples of $1,000,000 and not less than $1,000,000;
and
(c) the Borrower shall not select
a Revolving Credit Interest Period for any portion of the Loans
that would end after the Expiration Date.
4.03 Interest After Default. To the
extent permitted by Law, upon the declaration of an Event of
Default by the Agent and until such time as such Event of Default
shall have been cured or waived:
(a) the rate of interest for
each Revolving Credit Loan and Bid Loan otherwise respectively
applicable pursuant to Section 3.02 or Section 4.01 shall be
equal to 2.0% per annum plus the rate of interest otherwise
applicable to such Loan; and
(b) each other Obligation
hereunder if not paid when due shall bear interest at a rate per
annum equal to the sum of the rate of interest applicable under
the Base Rate Option plus an additional 2% per annum from the
time such Obligation becomes due and payable and until it is paid
in full.
The Borrower acknowledges that such
increased rates reflect, among other things, the fact that such
Loans or other amounts have become a substantially greater risk
given their default status and that the Banks are entitled to
additional compensation for such risk; and, all such interest
shall be payable by Borrower upon demand by Agent.
4.04 Euro-Rate Unascertainability and Illegality.
(a) If on any date on which a
Euro-Rate would otherwise be determined, the Agent shall have
determined that:
(i) adequate and reasonable
means do not exist for ascertaining such Euro-Rate, or
(ii) a contingency has
occurred which materially and adversely affects the London
interbank eurodollar market relating to the Euro-Rate, or
(b) if at any time any Bank shall
have determined that:
(i) the making, maintenance
or funding of any Revolving Credit Loan to which a Euro-Rate
Option applies has been made impracticable or unlawful by
compliance by such Bank in good faith with any Law or any
interpretation or application thereof by any Official Body or
with any request or directive of any such Official Body (whether
or not having the force of Law), or
(ii) such Euro-Rate
Option will not adequately and fairly reflect the cost to such
Bank of the establishment or maintenance of any such Revolving
Credit Loan, or
(iii) after making
all reasonable efforts, deposits of the relevant amount in
Dollars for the relevant Interest Period for a proposed Revolving
Credit Loan to which a Euro-Rate Option applies are not available
to such Bank with respect to such Loan in the London interbank
market, then, in the case of any event specified in subsection
(a) above, the Agent shall promptly so notify the Banks and the
Borrower thereof and in the case of an event specified in
subsection (b) above, such Bank shall promptly so notify the
Agent and endorse a certificate to such notice as to the specific
circumstances of such notice and the Agent shall promptly send
copies of such notice and certificate to the other Banks and the
Borrower. Upon such date as shall be specified in such notice
(which shall not be earlier than the date such notice is given)
the obligation of (A) the Banks in the case of such notice given
by the Agent or (B) such Bank in the case of such notice given by
such Bank to allow the Borrower to select a Euro-Rate Option
shall be suspended until the Agent shall have later notified the
Borrower or such Bank shall have later notified the Agent, of the
Agent's or such Bank's, as the case may be, determination that
the circumstances giving rise to such previous determination no
longer exist. If at any time the Agent makes a determination
under subsection (a) of this Section 4.04 and the Borrower has
previously notified the Agent of its selection of a Euro-Rate
Option and such Interest Rate Option has not yet gone into
effect, such notification shall be deemed to provide for the
termination of the Borrower's request (without penalty) for such
Loans if the Borrower has requested Euro-Rate Bid Loans and for
the selection of the Base Rate Option with respect to such Loans
if the Borrower has requested Loans under the Revolving Credit
Euro-Rate Option. If any Bank notifies the Agent of a
determination under subsection (b) of this Section 4.04, the
Borrower shall, subject to the Borrower's indemnification
Obligations under Section 5.05(b), as to any Revolving Credit
Loan of such Bank to which a Euro-Rate Option applies, on the
date specified in such notice either convert such Loan to the
Base Rate Option otherwise available with respect to such Loans
or prepay such Loan in accordance with Section 5.04. Absent due
notice from the Borrower of conversion or prepayment, such Loan
shall automatically be converted to the Base Rate Option
otherwise available with respect to such Loan upon such specified
date.
4.05 Selection of Interest Rate Options. If
the Borrower fails to give a Borrowing Notice for a Borrowing
Tranche of Revolving Credit Loans bearing interest at the Euro-
Rate prior to the expiration of an existing Interest Period
applicable to such Borrowing Tranche, such Borrowing Tranche
shall be converted automatically to the Base Rate Option
commencing upon the last day of the existing Interest Period.
ARTICLE V
PAYMENTS
5.01 Payments. All payments of principal
or interest made in respect of Bid Loans and payments or
prepayments to be made in respect of principal or interest on the
Revolving Credit Loans, Facility Fees, Agent's Fee, Bid Loan
Processing Fees or other fees or amounts due from the Borrower
hereunder shall be payable prior to 11:00 a.m. (Louisville,
Kentucky time) on the date when due without presentment, demand,
protest or notice of any kind, all of which are hereby expressly
waived by the Borrower, and without set-off, counterclaim or
other deduction of any nature (other than deductions for the
withholding of United States federal income tax which is due and
payable by a Bank in connection with the income it receives
hereunder, provided the Agent has elected not to make such
withholdings), and an action therefor shall immediately accrue.
Such payments shall be made to the Agent at the Principal Office
for the ratable accounts of the Banks with respect to the Loans
in U.S. Dollars and in immediately available funds, and the Agent
shall promptly distribute such amounts to the Banks in
immediately available funds, provided that in the event payments
are received by 11:00 a.m. (Louisville, Kentucky time) by the
Agent and such payments are not distributed to the Banks on the
same day received by the Agent, the Agent shall pay the Banks the
Federal Funds Effective Rate with respect to the amount of such
payments for each day held by the Agent and not distributed to
the Banks. The Agent's and each Bank's statement of account,
ledger or other relevant record shall, in the absence of manifest
error, be conclusive as the statement of the amount of principal
of and interest on the Loans and other amounts owing under this
Agreement.
5.02 Pro Rata Treatment of Banks. Each
borrowing of a Revolving Credit Loan shall be allocated to each
Bank according to its Ratable Share (irrespective of the amount
of Bid Loans outstanding), and each selection of or conversion to
any Interest Rate Option and each payment or prepayment by the
Borrower with respect to principal or interest on the Revolving
Credit Loans, Facility Fees, or other fees (except for the
Agent's Fee and the Bid Loan Processing Fee) or amounts due from
the Borrower hereunder to the Banks with respect to the Revolving
Credit Loans, shall (except as provided in Section 4.04(b) [Euro-
Rate Unascertainable], 5.04(b) [Voluntary Prepayments] or 5.05
[Additional Compensation in Certain Circumstances]) be made in
proportion to the Revolving Credit Loans outstanding from each
Bank and if no such Loans are then outstanding, in proportion to
the Ratable Share of each Bank. Each borrowing, payment or
prepayment by the Borrower with respect to principal and interest
due from the Borrower hereunder to any of the Banks with respect
to each Borrowing Tranche of Bid Loans (except as provided in
Section 5.05) shall be made in proportion to the Bid Loans within
such Borrowing Tranche outstanding from each Bank.
5.03 Interest Payment Dates. Interest
on Loans to which the Base Rate Option applies shall be due and
payable in arrears on the first Business Day of each April, July,
October and January after the date hereof commencing on April 1,
1996 and on the Expiration Date or upon acceleration of the
Notes. Interest on Fixed Rate Bid Loans or any Loans (including
Euro-Rate Bid Loans) to which the Euro-Rate Option applies shall
be due and payable in arrears on the last day of each Interest
Period for those Loans and also in arrears on the day which is
three (3) months after the first day of such Interest Period if
such Interest Period is greater than three (3) months and on the
Expiration Date or acceleration of the Notes. Interest on the
principal amount of each Loan or other monetary Obligation shall
be due and payable on demand after such principal amount or other
monetary Obligation becomes due and payable (whether on the
stated maturity date, upon acceleration or otherwise).
5.04 Voluntary Prepayments.
(a) The Borrower may not prepay
the Bid Loans. The Borrower shall have the right at its option
from time to time to prepay the Revolving Credit Loans in whole
or part without premium or penalty (except as provided in
subsection (b) below or in Section 5.05):
(i) at any time
with respect to any Revolving Credit Loan to which the Base Rate
Option applies,
(ii) on the last day
of the applicable Interest Period with respect to Revolving
Credit Loans to which a Euro-Rate Option applies, and
(iii) on the
date specified in a notice by any Bank pursuant to Section
4.04(b) [Euro-Rate Unascertainable] with respect to any Revolving
Credit Loan to which a Euro-Rate Option applies.
Whenever the Borrower desires to prepay any
part of the Revolving Credit Loans, it shall provide a prepayment
notice to the Agent at least one (1) Business Day prior to the
date of prepayment of Revolving Credit Loans setting forth the
following information:
(y) the date, which
shall be a Business Day, on which the proposed prepayment is to
be made; and
(z) the total
principal amount of such prepayment, which shall not be less than
$500,000.
All prepayment notices shall be irrevocable.
The principal amount of the Revolving Credit Loans for which a
prepayment notice is given, together with interest on such
principal amount except with respect to Revolving Credit Loans to
which the Base Rate Option applies, shall be due and payable on
the date specified in such prepayment notice as the date on which
the proposed prepayment is to be made. If the Borrower prepays a
Revolving Credit Loan but fails to specify the applicable
Borrowing Tranche which the Borrower is prepaying, the prepayment
shall be applied first to Revolving Credit Loans to which the
Base Rate Option applies, then to Revolving Credit Loans to which
the Euro-Rate Option applies. Any prepayment hereunder shall be
subject to the Borrower's Obligation to indemnify the Banks under
Section 5.05(b).
(b) In the event any
Bank (i) gives notice under Section 4.04(b) or Section 5.05(a),
(ii) does not fund Revolving Credit Loans or Bid Loans which it
is obligated to fund because the making of such Loans would
contravene any Law applicable to such Bank, (iii) does not
approve any action as to which consent of the Required Banks is
requested by the Borrower and obtained hereunder, or (iv) becomes
subject to the control of an Official Body (other than normal and
customary supervision), then the Borrower shall have the right at
its option, with the consent of the Agent, which shall not be
unreasonably withheld, to prepay the Loans of such Bank in whole
together with all interest accrued thereon and terminate such
Bank's Commitment, within ninety (90) days after (w) receipt of
such Bank's notice under Section 4.04(b) or 5.05(a), (x) the date
such Bank has failed to fund Revolving Credit Loans or Bid Loans
which it is obligated to fund because the making of such Loans
would contravene any Law applicable to such Bank, (y) the date of
obtaining the consent which such Bank has not approved, or
(z) the date such Bank became subject to the control of an
Official Body, as applicable; provided that the Borrower shall
also pay to such Bank at the time of such prepayment any amounts
required under Section 5.05 and any accrued interest due on such
amount and any related fees; provided, however, that the
Commitment of such Bank shall be provided by one or more of the
remaining Banks or a replacement bank reasonably acceptable to
the Agent or, if not so provided by a Bank or replacement bank,
terminated; provided, further, the remaining Banks shall have no
obligation hereunder to increase their Commitments or provide the
Bid Loan of such Bank. Notwithstanding the foregoing, the Agent
may only be replaced subject to the requirements of Section
10.14. No replacement or termination of a Bank under this
Section 5.04(b) shall affect such Bank's rights in respect of
matured or unmatured unreimbursed claims or potential claims
under Sections 5.05 and 11.03.
5.05 Additional Compensation in
Certain Circumstances.
(a) Increased Costs
or Reduced Return Resulting from Taxes, Reserves, Capital
Adequacy Requirements, Expenses, Etc. If any new, or change in
any existing, Law, guideline or interpretation or application
thereof by any Official Body charged with the interpretation or
administration thereof or compliance with any new, or change in
any existing, request or directive (whether or not having the
force of Law) of any central bank or other Official Body, in each
case occurring after the date hereof:
(i) subjects any
Bank to any tax or changes the basis of taxation with respect to
this Agreement, the Revolving Credit Notes, Bid Notes, the
Revolving Credit Loans, the Bid Loans or payments by the Borrower
of principal, interest, Facility Fees or other amounts due from
the Borrower hereunder or under the Revolving Credit Notes or the
Bid Notes (except for taxes on the overall net income of such
Bank),
(ii) imposes, modifies
or deems applicable any reserve, special deposit or similar
requirement against credits or commitments to extend credit
extended by, or assets (funded or contingent) of, deposits with
or for the account of, or other acquisitions of funds by, any
Bank, or
(iii) imposes,
modifies or deems applicable any capital adequacy or similar
requirement (A) against assets (funded or contingent) of, or
letters of credit, other credits or commitments to extend credit
extended by, any Bank, or (B) otherwise applicable to the
obligations of any Bank under this Agreement, and the result of
any of the foregoing is to increase the cost to, reduce the
income receivable by, or impose any expense (including loss of
margin) upon any Bank with respect to this Agreement, the
Revolving Credit Notes, the Bid Notes or the making, maintenance
or funding of any part of the Revolving Credit Loans or Bid Loans
(or, in the case of any capital adequacy or similar requirement,
to have the effect of reducing the rate of return on any Bank's
capital, taking into consideration such Bank's customary policies
with respect to capital adequacy) by an amount which such Bank in
its sole discretion deems to be material, such Bank shall from
time to time notify the Borrower and the Agent of the amount
determined in good faith (using any averaging and attribution
methods employed in good faith) by such Bank to be necessary to
compensate such Bank for such increase in cost, reduction of
income or return or additional expense, provided that a Bank
shall not give the Borrower notice hereunder unless the Bank is
generally imposing such increased costs on its similarly situated
customers. Such notice shall be delivered within thirty (30)
Business Days after such Bank becomes aware of such increase of
costs, reduction of income or return or imposition of expense and
shall set forth in reasonable detail the basis for such
determination. Such amount shall be due and payable by the
Borrower to such Bank ten (10) Business Days after such notice is
given.
(b) Indemnity. In addition
to the compensation required by subsection (a) of this Section
5.05, the Borrower shall indemnify each Bank against all
liabilities, losses or expenses (including loss of margin, any
loss or expense incurred in liquidating or employing deposits
from third parties and any loss or expense incurred in connection
with funds acquired by a Bank to fund or maintain Loans subject
to the Euro-Rate Option or Bid Loan Fixed Rate Option) which such
Bank sustains or incurs as a consequence of any:
(i) payment,
prepayment, conversion or renewal of any Loan to which the Euro-
Rate Option or Bid Loan Fixed Rate Option applies on a day other
than the last day of the corresponding Interest Period (whether
or not such payment or prepayment is mandatory, voluntary or
automatic and whether or not such payment or prepayment is then
due),
(ii) attempt by the
Borrower to revoke (expressly, by later inconsistent notices or
otherwise) in whole or part any notice relating to Revolving
Credit Loan Requests under Section 2.04 or Section 4.02 or
prepayments under Section 5.04,
(iii) a Potential
Default or Event of Default under this Agreement or any other
Loan Document, including any failure of the Borrower to pay when
due (by acceleration or otherwise) any principal of or interest
on the Revolving Credit Loans or Bid Loans, Facility Fees or any
other Obligations due hereunder, or
(iv) payment or
prepayment of any Bid Loan on a day other than the maturity date
thereof (whether or not such payment or prepayment is mandatory
or voluntary).
If any Bank sustains or incurs any such loss or
expense, it shall from time to time notify the Borrower of the
amount determined in good faith by such Bank (which determination
may include such assumptions, allocations of costs and expenses
and averaging or attribution methods as such Bank shall deem
reasonable) to be necessary to indemnify such Bank for such loss
or expense. Such notice shall set forth in reasonable detail the
basis for such determination. Such amount shall be due and
payable by the Borrower to such Bank ten (10) Business Days after
such notice is given.
ARTICLE VI
REPRESENTATIONS AND WARRANTIES
6.01 Representations and Warranties. The
Borrower represents and warrants to the Agent and each of the
Banks as follows:
(a) Organization and Qualification.
The Borrower and each of its Significant Subsidiaries is a
corporation, validly existing and in good standing under the laws
of its jurisdiction of incorporation. The Borrower and each of
its Subsidiaries has the corporate power to own or lease its
properties and to engage in the business it presently conducts or
proposes to conduct. The Borrower and each of its Subsidiaries
is duly licensed or qualified and in good standing in each
jurisdiction where the property owned or leased by it or the
nature of the business transacted by it or both makes such
licensing or qualification necessary, except in jurisdictions in
which the failure to be in good standing or to be so qualified or
licensed would not result in a Material Adverse Change.
(b) Capitalization and Ownership.
At October 31, 1995, the authorized capital stock of the Borrower
consists of 75,000,000 common shares, of which 21,294,223 shares
were issued and outstanding, and preferred stock as described in
the SEC Reports. All of such common shares have been validly
issued and are fully paid and nonassessable and owned by LG&E
Energy Corp. The Borrower has not granted any options, warrants
or other rights outstanding to purchase any such common shares.
(c) Subsidiaries. On the
Closing Date, the Borrower has no Subsidiaries.
(d) Power and Authority. Each
Loan Party has full corporate power to enter into, execute,
deliver and carry out this Agreement and the other Loan Documents
to which it is a party, to incur the Indebtedness contemplated by
the Loan Documents and to perform its Obligations under the Loan
Documents to which it is a party and all such actions have been
duly authorized by all necessary proceedings on its part.
(e) Validity and Binding Effect.
This Agreement has been duly and validly executed and delivered
by the Borrower, and each other Loan Document which the Borrower
or any other Loan Party is required to execute and deliver on or
after the date hereof will have been duly executed and delivered
by the Borrower or such other Loan Party on the required date of
delivery of such Loan Document. This Agreement and each other
Loan Document constitutes, or will when executed constitute,
legal, valid and binding obligations of each Loan Party on and
after its date of delivery thereof, enforceable against such Loan
Party in accordance with its terms, except to the extent that
enforceability of such Loan Document may be limited by
bankruptcy, insolvency, reorganization, moratorium or other
similar laws affecting the enforceability of creditors' rights
generally or general principles of equity, including without
limitation, any equitable principles which limit the right of
specific performance.
(f) No Conflict. Neither
the execution and delivery of this Agreement or the other Loan
Documents by any Loan Party nor the consummation of the
transactions herein or therein contemplated or compliance with
the terms and provisions hereof or thereof by it will conflict
with, constitute a default under or result in any breach of
(i) the terms and conditions of the Articles of Incorporation,
by-laws or other organizational documents of any Loan Party or
(ii) except as set forth in subsection (m) of this Section 6.01,
any Law or of any material agreement or instrument or order
(including without limitation the FERC Order), writ, judgment,
injunction or decree to which any Loan Party is a party or by
which it is bound or to which it is subject, or result in the
creation or enforcement of any Lien, charge or encumbrance
whatsoever upon any property (now or hereafter acquired) of any
Loan Party.
(g) Litigation. Except as
disclosed in any Forms 10-K, 10-Q or 8-K filed by the Borrower
with the Securities and Exchange Commission and delivered to the
Agent prior to the Closing Date (the "SEC Reports"), there are no
actions, suits, proceedings or investigations pending or, to the
knowledge of the Borrower, threatened against the Borrower or any
Subsidiary of the Borrower at law or equity before any Official
Body which individually or in the aggregate may result in any
Material Adverse Change. Neither the Borrower nor any Subsidiary
of the Borrower is in violation of any order, writ, injunction or
decree of any Official Body which is reasonably likely to result
in any Material Adverse Changes.
(h) Title to Properties. Each
of the Borrower and its Subsidiaries has good and marketable
title to or valid leasehold interest in all of its properties,
assets and other rights material to the operations of the
Borrower and its Subsidiaries taken as a whole which it purports
to own or lease or which are reflected as owned or leased on its
books and records, free and clear of all Liens and encumbrances
except Permitted Liens, and subject to the terms and conditions
of the applicable leases. All leases of property material to the
operations of the Borrower and its Subsidiaries taken as a whole
are in full force and effect without the necessity for any
consent which has not previously been obtained for the
consummation of the transactions contemplated hereby.
(i) Financial Statements.
(A) Historical Statements.
The Borrower has delivered to the Agent copies of its audited
year-end financial statements for and as of the end of the three
(3) fiscal years ended December 31, 1994 (the "Annual
Statements"). In addition, the Borrower has delivered to the
Agent copies of its unaudited consolidated interim financial
statements for the fiscal year to date and as of the end of the
fiscal quarter ended September 30, 1995 (the "Interim
Statements") (the Annual and Interim Statements being
collectively referred to as the "Historical Statements"). The
Historical Statements were compiled from the books and records
maintained by the Borrower's management, present fairly the
consolidated financial condition of the Borrower as of their
dates and the results of operations for the fiscal periods then
ended and have been prepared in accordance with GAAP and, except
as otherwise stated therein, consistently applied, subject (in
the case of the Interim Statements) to normal year-end audit
adjustments.
(B) Accuracy of
Financial Statements. At the Closing Date, the Borrower has no
material liabilities, contingent or otherwise, or forward or
long-term commitments that are not disclosed in the Historical
Statements or in the notes thereto or the SEC Reports, and except
as disclosed therein, there are no unrealized or anticipated
losses from any commitments of the Borrower which could
reasonably be expected to cause a Material Adverse Change. Since
December 31, 1994, no Material Adverse Change has occurred.
(j) Margin Stock. Neither
the Borrower nor any Subsidiary of the Borrower engages or
intends to engage principally, or as one of its important
activities, in the business of extending credit for the purpose,
immediately, incidentally or ultimately, of purchasing or
carrying margin stock (within the meaning of Regulation U). No
part of the proceeds of any Loan has been or will be used,
immediately, incidentally or ultimately, to purchase or carry any
margin stock or to extend credit to others for the purpose of
purchasing or carrying any margin stock or to refund Indebtedness
originally incurred for such purpose, or for any purpose which
entails a violation of or which is inconsistent with the
provisions of the regulations of the Board of Governors of the
Federal Reserve System. Neither the Borrower nor any Subsidiary
of the Borrower holds or intends to hold margin stock in such
amounts that more than 25% of the reasonable value of the assets
of the Borrower or any Subsidiary of the Borrower are or will be
represented by margin stock.
(k) Full Disclosure. Neither
this Agreement nor any other Loan Document, nor any certificate,
statement, agreement or other documents furnished by the Borrower
or any Subsidiary of the Borrower to the Agent or any Bank in
connection herewith or therewith, contained as of its date any
untrue statement of a material fact or omitted as of its date to
state a material fact necessary in order to make the statements
contained herein and therein, in light of the circumstances under
which they were made, not misleading. There is no fact known to
the Borrower which materially adversely affects the business,
property, assets, financial condition or results of operations of
the Borrower and its Subsidiaries taken as a whole which has not
been set forth in this Agreement or in the SEC Reports,
Historical Statements, certificates, statements, agreements or
other documents furnished in writing by the Borrower to the Agent
and the Banks prior to or at the date hereof in connection with
the transactions contemplated hereby.
(l) Taxes. All federal,
state and other material tax returns required to have been filed
with respect to the Borrower and each of its Subsidiaries have
been filed and payment or adequate provision has been made for
the payment of all taxes, fees, assessments and other
governmental charges which have or may become due pursuant to
said returns or to assessments received except to the extent that
(i) such taxes, fees, assessments and other charges are being
contested in good faith by appropriate proceedings diligently
conducted and for which such reserves or other appropriate
provisions, if any, as shall be required by GAAP shall have been
made or (ii) the nonpayment of such taxes, fees, assessments or
other changes could not reasonably be expected to result in a
Material Adverse Change.
(m) Consents and Approvals.
No consent, approval, exemption, order or authorization of, or a
registration or filing with, any Official Body or any other
Person is required by any Law or any agreement in connection with
the execution, delivery and, except as described in this
subsection (m), carrying out of this Agreement and the other Loan
Documents by any Loan Party other than such consents, approvals,
exemptions, orders or authorizations that have been obtained and
other than such registrations and filings as have been made.
FERC has issued its order (the "FERC Order") authorizing the
incurrence by the Borrower of short-term debt in the aggregate
principal amount not exceeding $200,000,000 outstanding at any
one time, subject to the condition that, among other things, all
such short-term debt shall be incurred on or before December 31,
1996, and shall mature no later than December 31, 1997. Such
order is in full force and effect. All Loans to be made to the
Borrower under this Agreement will constitute short-term debt
within the meaning of such order. Additional authorization from
FERC will be necessary in order for the Borrower to obtain any
Loans under this Agreement after December 31, 1996, or to have
outstanding more than $200,000,000 in principal amount of short-
term debt (including Loans made under this Agreement). On the
Closing Date, the FERC Order is the only consent, approval,
exemption, order, authorization, registration or filing required
by any Law or any agreement in connection with the execution and
delivery of this Agreement and the other Loan Documents by the
Borrower. On the Closing Date, the Borrower has no short-term
debt (within the meaning of the FERC Order) or commitment to lend
such short-term debt other than under this Agreement and the
other Loan Documents.
(n) No Event of Default;
Compliance with Instruments. No event has occurred and is
continuing and no condition exists or will exist after giving
effect to the borrowings to be made on the Closing Date under the
Loan Documents which constitutes an Event of Default or Potential
Default. No Loan Party is in violation of (i) any term of its
certificate of incorporation, by-laws, or other organizational
documents or (ii) any material agreement or instrument to which
it is a party or by which it or any of its properties is subject
or bound where such violation could reasonably be expected to
constitute a Material Adverse Change.
(o) Insurance. The Borrower
and each of its Significant Subsidiaries has policies of
insurance which provide adequate coverage from reputable and
financially sound insurers or is self-insured, in each case, in
amounts sufficient to insure the assets and risks of the Borrower
and each of its Significant Subsidiaries in accordance with
prudent business practice in the industry. As of the Closing
Date, no notice has been given or claim made, and no grounds
exist, to cancel or avoid any of such policies or any surety
bonds or to reduce the coverage provided thereby.
(p) Compliance with Laws.
The Borrower and each of its Subsidiaries is in compliance in all
material respects with all applicable Laws (other than
Environmental Laws, which are specifically addressed in
subsection (t)) in all jurisdictions in which the Borrower or any
of its Subsidiaries is presently or will be doing business,
except where the failure to do so could not reasonably be
expected to constitute a Material Adverse Change.
(q) Investment Company Act;
Public Utility Holding Company Act. Neither the Borrower nor any
of its Subsidiaries is an "investment company" registered or
required to be registered under the Investment Company Act of
1940 or under the "control" of an "investment company" as such
terms are defined in the Investment Company Act of 1940 or under
the "control" of an "investment company" as such terms are
defined in the Investment Company Act of 1940, and shall not
become such an "investment company" or under such "control." As
of the Closing Date, the Borrower is not a "holding company" as
defined in, and the Borrower is exempt from regulation (except
for Section 9(a)(2) thereof) under, The Public Utility Holding
Company Act of 1935.
(r) Plans and Benefit
Arrangements. The Borrower and each other member of the ERISA
Group are in compliance in all material respects with any
applicable provisions of ERISA with respect to all Benefit
Arrangements, Plans and Multiemployer Plans. There has been no
Prohibited Transaction with respect to any Benefit Arrangement or
any Plan or, to the best knowledge of the Borrower, with respect
to any Multiemployer Plan or Multiple Employer Plan, which could
result in any material liability of the Borrower or any other
member of the ERISA Group. The Borrower and all members of the
ERISA Group have made when due any and all payments required to
be made under any agreement relating to a Multiemployer Plan or a
Multiple Employer Plan or any Law pertaining thereto. With
respect to each Plan and Multiemployer Plan, the Borrower and
each member of the ERISA Group (i) have fulfilled in all material
respects their obligations under the minimum funding standards of
ERISA, (ii) have not incurred any liability to the PBGC and
(iii) have not had asserted against them any penalty for failure
to fulfill the minimum funding requirements of ERISA.
(s) Employment Matters. The
Borrower and each of its Subsidiaries are in compliance with the
Labor Contracts and all applicable federal, state and local labor
and employment Laws, including those related to equal employment
opportunity and affirmative action, labor relations, minimum
wage, overtime, child labor, medical insurance continuation,
worker adjustment and relocation notices, immigration controls
and worker and unemployment compensation, where the failure to
comply could reasonably be expected to constitute a Material
Adverse Change. There are no outstanding grievances, arbitration
awards or appeals therefrom arising out of the Labor Contracts or
current or threatened strikes, picketing, handbilling or other
work stoppages or slowdowns at facilities of the Borrower or any
of its Subsidiaries which in any case could reasonably be
expected to constitute a Material Adverse Change.
(t) Environmental Matters.
Except for conditions, violations or failures which individually
and in the aggregate are not reasonably likely to result in a
Material Adverse Change and except as disclosed in the SEC
Reports (i) the Borrower and each of its Subsidiaries are in
compliance with all Environmental Laws, (ii) there are no
circumstances at, on or under the Property that constitute a
breach of or non-compliance with any of the Environmental Laws,
and there are no past or present Environmental Conditions at, on
or under the Property or, to the Borrower's knowledge, at, on or
under adjacent property, that prevent compliance with the
Environmental Laws at the Property, and (iii) neither the
Borrower nor any of its Subsidiaries has received any notice that
it is considered potentially responsible for any Environmental
Conditions on or off of the Property, nor does it have any reason
to believe it will receive such a notice.
6.02 Updates to Representations and
Warranties. Should any of the representations or warranties
contained in Section 6.01 become outdated or incorrect in any
material respect, the Borrower may and, prior to making any
Revolving Credit Loan Request or Bid Loan Request after the
Closing Date, shall promptly provide the Agent a Schedule 7.02
which will contain such revisions or updates to such
representation and warranties as may be necessary or appropriate
to update or correct same; provided, however that no
representation or warranty shall be deemed to have been amended,
modified or superseded by any such correction or update, nor
shall any breach of warranty or representation resulting
therefrom be deemed to have been cured thereby, unless and until
the Required Banks, in their sole and absolute discretion, shall
have accepted in writing such revisions or updates set forth in
such Schedule 7.02.
ARTICLE VII
CONDITIONS OF LENDING
The obligation of each Bank to make Revolving
Credit Loans or Bid Loans hereunder is subject to the performance
by the Borrower of its Obligations to be performed hereunder at
or prior to the making of any such Revolving Credit Loans or Bid
Loans and to the satisfaction of the following further
conditions:
7.01 Closing Date Conditions. No Loans
shall be made until on or after the Closing Date and each of the
conditions set forth below in this Section 7.01 have been
satisfied. On the Closing Date:
(a) The representations
and warranties of the Borrower contained in Article VI shall be
true and accurate on and as of the Closing Date with the same
effect as though such representations and warranties had been
made on and as of such date (except representations and
warranties which relate solely to an earlier date or time, which
representations and warranties shall be true and correct on and
as of the specific dates or times referred to therein), and the
Borrower shall have performed and complied with all covenants and
conditions hereof; no Event of Default or Potential Default shall
have occurred and be continuing or shall exist; and there shall
be delivered to the Agent for the benefit of each Bank a
certificate of the Borrower, dated the Closing Date and signed by
the Chief Executive Officer, President, Treasurer or Chief
Financial Officer of the Borrower, to each such effect.
(b) There shall be delivered
to the Agent for the benefit of each Bank a certificate dated the
Closing Date and signed by the Secretary or an Assistant
Secretary or Treasurer of the Borrower, certifying as appropriate
as to:
(i) all action taken
by the Borrower in connection with this Agreement and the other
Loan Documents;
(ii) the names of the
officer or officers authorized to sign this Agreement and the
other Loan Documents and the true signatures of such officer or
officers and specifying the Authorized Officers permitted to act
on behalf of the Borrower for purposes of this Agreement and the
true signatures of such officers, on which the Agent and each
Bank may conclusively rely; and
(iii) copies of
the organizational documents of the Borrower, including its
articles of incorporation and by-laws as in effect on the Closing
Date, in the case of the Borrower certified by the appropriate
state official where such documents are filed in a state office,
together with certificates from the appropriate state officials
as to the continued existence and good standing of the Borrower
in each state where it is organized or qualified to do business.
(c) The Revolving Credit
Notes, Bid Notes, and each other Loan Document shall have been
duly executed and delivered to the Agent for the benefit of the
Banks.
(d) There shall be delivered
to the Agent for the benefit of each Bank a written opinion of
Gardner, Carton & Douglas, counsel for the Borrower, dated the
Closing Date substantially in the form of Exhibit 7.01(d)(i).
(e) All legal details
and proceedings in connection with the transactions contemplated
by the Agreement and the other Loan Documents shall be in form
and substance satisfactory to the Agent and counsel for the
Agent, and the Agent shall have received all such other
counterpart originals or certified or other copies of such
documents and proceedings in connection with such transactions,
in form and substance satisfactory to the Agent and said counsel,
as the Agent or said counsel may reasonably request.
(f) The Borrower shall
pay or cause to be paid to the Agent for itself or for the
account of the Banks, as applicable, to the extent not previously
paid all fees accrued through the Closing Date and the costs and
expenses for which the Agent or the Banks are entitled to be
reimbursed.
(g) Since December 31, 1994,
no Material Adverse Change shall have occurred; and there shall
be delivered to the Agent for the benefit of each Bank a
certificate dated the Closing Date and signed by the Chief
Executive Officer, President, Treasurer or Chief Financial
Officer of the Borrower to such effect.
(h) The making of any
Loan on the Closing Date shall not contravene any Law applicable
to the Borrower or any of the Banks.
(i) No action, proceeding,
investigation, regulation or legislation shall have been
instituted, threatened or proposed before any court, governmental
agency or legislative body to enjoin, restrain or prohibit, or to
obtain damages in respect of, this Agreement or the consummation
of the transactions contemplated hereby or which, in the Agent's
sole discretion, would make it inadvisable to consummate the
transactions contemplated by this Agreement or any of the other
Loan Documents.
7.02 Each Loan Made After the Closing
Date. At the time of making any Revolving Credit Loans or Bid
Loans other than any Revolving Credit Loans or Bid Loans made on
the Closing Date hereunder and after giving effect to the
proposed borrowings: except as disclosed on Schedule 7.02 (as
previously delivered to the Agent and the Banks and accepted by
the Required Banks), the representations and warranties of the
Borrower contained in Article VI shall be true on and as of the
date of such additional Revolving Credit Loans or Bid Loans with
the same effect as though such representations and warranties had
been made on and as of such date (except representations and
warranties which expressly relate solely to an earlier date or
time, which representations and warranties shall be true and
correct on and as of the specific dates or times referred to
therein); no Event of Default or Potential Default shall have
occurred and be continuing or shall exist; the making of such
Revolving Credit Loans or Bid Loans shall not contravene any Law
applicable to the Borrower or any of the Banks; all necessary
approvals of the FERC for the requested Loans shall be in full
force and effect; and the Borrower shall have delivered to the
Agent a duly executed and completed Revolving Credit Loan Request
or Bid Loan Request, as applicable, and the Borrower shall
represent and warrant in such Revolving Credit Loan Request or
Bid Loan Request that (i) the Borrower is not a "holding company"
as defined in, and the Borrower is exempt from regulation (except
for Section 9(a)(2) thereof) under, The Public Utility Holding
Company Act of 1935 or (ii) the Borrower is a "holding Company"
as defined in The Public Utility Holding Company Act of 1935, and
the Borrower has registered under such Act and is in compliance
with such Act in all material respects.
ARTICLE VIII
COVENANTS
8.01 Affirmative Covenants. The
Borrower covenants and agrees that until payment in full of the
Revolving Credit Loans and Bid Loans and interest thereon,
satisfaction of all of the Borrower's other Obligations under the
Loan Documents and termination of the Commitments, the Borrower
shall comply at all times with the following affirmative
covenants:
(a) Preservation of Existence,
Etc.. The Borrower shall, and shall cause each of its
Significant Subsidiaries to, maintain its corporate existence
(except as otherwise specifically permitted under
Section 8.02(b)) and its license or qualification and good
standing in each jurisdiction in which its ownership or lease of
property or the nature of its business makes such license or
qualification necessary, except where the failure to be so
licensed, qualified or in good standing would not result in a
Material Adverse Change.
(b) Payment of Liabilities,
Including Taxes, Etc.. The Borrower shall, and shall cause each
of its Significant Subsidiaries to, duly pay and discharge all
liabilities to which it is subject or which are asserted against
it, promptly as and when the same shall become due and payable,
including all taxes, assessments and governmental charges upon it
or any of its properties, assets, income or profits, prior to the
date on which penalties attach thereto, except to the extent that
such liabilities, including taxes, assessments or charges, are
being contested in good faith and by appropriate and lawful
proceedings diligently conducted and for which such reserve or
other appropriate provisions, if any, as shall be required by
GAAP shall have been made, but only to the extent that failure to
discharge any such liabilities would not result in any additional
liability which could reasonably be expected to result in a
Material Adverse Change, provided that the Borrower and its
Significant Subsidiaries will pay or bond all such liabilities
forthwith upon the commencement of proceedings to foreclose any
Lien which may have attached as security therefor.
(c) Maintenance of Insurance.
The Borrower shall, and shall cause each of its Significant
Subsidiaries to, insure its properties and assets against loss or
damage by fire and such other insurable hazards as such assets
are commonly insured (including fire, extended coverage, property
damage, workers' compensation, public liability and business
interruption insurance) and against other risks (including errors
and omissions) in such amounts as similar properties and assets
are insured by prudent companies in similar circumstances
carrying on similar businesses, and with reputable and
financially sound insurers, including self-insurance to the
extent customary or appropriate.
(d) Maintenance of Properties
and Leases. The Borrower shall, and shall cause each of its
Subsidiaries to, maintain in good repair, working order and
condition (ordinary wear and tear excepted) in accordance with
the general practice of other businesses of similar character and
size, all of those material properties useful or necessary to the
business of the Borrower and its Subsidiaries taken as a whole to
the extent the Borrower deems it economical to do so, and from
time to time, the Borrower will make or cause to be made all
appropriate repairs, renewals or replacements thereof to the
extent the Borrower deems it economical to do so. The Borrower
may, and may allow its Subsidiaries to, abandon, cease to
maintain or repair or otherwise dispose of properties which in
its judgment are not necessary or useful to its business provided
that such abandonment, cessation or disposition could not
reasonably be expected to result in a Material Adverse Change.
(e) Visitation Rights. The
Borrower shall, and shall cause each of its Subsidiaries to,
permit any of the officers or authorized employees or
representatives of the Agent or any of the Banks during normal
business hours and with due understanding and compliance with
existing security measures of the Borrower and its Subsidiaries
to visit and inspect any of its properties and to examine, audit
and make excerpts from its books and records (except to the
extent access to such information may be restricted by Law or
such information may be subject to a confidentiality agreement
between the Borrower or any of its Subsidiaries and a third
party) and discuss its business affairs, finances and accounts
with its officers, all in such detail, with such officers and at
such times and as often as the Banks may reasonably request,
provided (1) if no Event of Default shall have occurred and be
continuing, any visit, examination or audit shall be conducted by
the Agent on behalf of the Banks and the Agent shall be permitted
to visit, inspect and audit the Borrower and its Subsidiaries and
its properties, books and records only one (1) time per year
under this Section 8.01(e) (the limitation in this clause (1)
shall terminate if an Event of Default shall have occurred and be
continuing) and (2) that Agent shall provide the Borrower, and
each Bank shall provide the Borrower and the Agent, as the case
may be, with reasonable notice prior to any visit, audit or
inspection permitted under this Section 8.01(e).
(f) Keeping of Records and
Books of Account. The Borrower shall, and shall cause each of
its Subsidiaries to, maintain and keep proper books of record and
account which enable the Borrower and its Subsidiaries to issue
financial statements in accordance with GAAP and as otherwise
required by applicable Laws of any Official Body having
jurisdiction over the Borrower or any of its Subsidiaries, and in
which full, true and correct entries shall be made in all
material respects of all its dealings and business and financial
affairs.
(g) Plans and Benefit
Arrangements. The Borrower shall, and shall cause each other
member of the ERISA Group to, comply with ERISA, the Internal
Revenue Code and other applicable Laws applicable to Plans and
Benefit Arrangements except where such failure, alone or in
conjunction with any other failure, could not reasonably be
expected to result in a Material Adverse Change. Without
limiting the generality of the foregoing, the Borrower shall
cause all of its Plans and all Plans maintained by any other
member of the ERISA Group to be funded in accordance with the
minimum funding requirements of ERISA and shall make, and cause
each other member of the ERISA Group to make, in a timely manner,
all contributions due to Plans, Benefit Arrangements and
Multiemployer Plans.
(h) Compliance with Laws.
The Borrower shall, and shall cause each of its Subsidiaries to,
comply with all applicable Laws, including all Environmental
Laws, in all respects, provided that it shall not be deemed to be
a violation of this Section 8.01(h) if any failure to comply with
any Law would not result in fines, penalties, remediation costs,
other similar liabilities or injunctive relief which in the
aggregate would constitute a Material Adverse Change.
(i) Use of Proceeds. The
Borrower will use the proceeds of the Loans only for lawful
purposes in accordance with Section 2.07 as applicable and such
uses shall not contravene any applicable Law or any other
provision hereof.
(j) Delivery of Ratings of
the Borrower's Secured Public Indebtedness. The Borrower shall
at all times have received a rating of the Borrower's Secured
Public Indebtedness from Standard & Poor's and Moody's and shall
have contracted with Standard & Poor's and Moody's for the
periodic modification and updating of such rating. The Borrower
shall notify the Agent of any new rating of the Borrower's
Secured Public Indebtedness which the Borrower receives or any
modification of an existing rating of any such Indebtedness, in
each instance within five (5) Business Days following the date of
such receipt and deliver copies of any documents which the
Borrower receives evidencing, describing or explaining or
relating to such new or modified rating within such five (5)
Business Day period. Any such new rating or change in an
existing rating by Standard & Poor's or Moody's shall be
effective under this Agreement on the date on which the Borrower
receives such new or modified rating. If the Borrower shall at
any time fail to have received a current rating of its Secured
Public Indebtedness from Standard & Poor's and Moody's or
otherwise fail to comply with the first sentence in
Section 8.01(j): (i) the Borrower shall immediately notify Agent
of such failure; and (ii) the Borrower Debt Rating shall be
deemed to be a Fourth-Level Debt Rating for all purposes under
this Agreement immediately upon the occurrence of such failure
whether or not the Borrower delivers the notice described in
clause (i). The Borrower Debt Rating shall continue to be a
Fourth-Level Debt Rating until such time as the Borrower
(1) cures such failure and is in compliance with the first
sentence above and (2) otherwise qualifies for a rating higher
than a Fourth-Level Debt Rating pursuant to the procedures set
forth herein.
8.02 Negative Covenants. The Borrower
covenants and agrees that until payment in full of the Revolving
Credit Loans and the Bid Loans and interest thereon, satisfaction
of all of the Borrower's other Obligations hereunder and
termination of the Commitments, the Borrower shall comply with
the following negative covenants:
(a) Liens. The Borrower shall
not, and shall not permit any of its Significant Subsidiaries to,
at any time create, incur, assume or suffer to exist any Lien on
any of its properties or assets, tangible or intangible, now
owned or hereafter acquired, or agree or become liable to do so,
except Permitted Liens.
(b) Liquidations, Mergers,
Consolidations, Dispositions. The Borrower shall not, and shall
not permit any of its Significant Subsidiaries or any Guarantor
to, merge or consolidate with or sell, assign, lease or otherwise
dispose of (whether in one transaction or a series of
transactions) all or substantially all of its assets (whether now
owned or hereafter acquired) to any person, except :
(i) the Borrower may
merge with any person, provided that, immediately thereafter and
after giving effect thereto, no event shall occur or be
continuing which constitutes an Event of Default or Potential
Default and the surviving corporation has a net worth (as
determined in accordance with GAAP) immediately subsequent to
such merger at least equal to the net worth of the Borrower
immediately prior to the merger and, if the surviving corporation
is not the Borrower, the surviving corporation expressly assumes
the obligations of the Borrower under the Loan Documents;.
(ii) any Guarantor may
merge or consolidate with any Loan Party; and
(iii) any Subsidiary
of the Borrower that is not a Guarantor may merge or consolidate
with the Borrower or any of its Subsidiaries.
(c) Disposition of Assets.
The Borrower shall not, and shall not permit any of its
Significant Subsidiaries or any Guarantor to, sell, lease, or
otherwise transfer or dispose of voluntarily or involuntarily
(including sale, assignment, discount or other disposition of
accounts, contract rights, chattel paper, equipment or general
intangible with or without recourse) except:
(i) any sale,
transfer or lease of assets in the ordinary course of business;
(ii) any sale, transfer
or lease of assets by the Borrower to a Subsidiary of the
Borrower that joins this Agreement as a Guarantor pursuant to
Section 11.18;
(iii) any sale,
transfer or lease of worn-out or obsolete assets on a basis
consistent with good business practices; and
(iv) any sale,
transfer or lease of assets, other than those specifically
excepted in clauses (i) ,(ii) and (iii) above, so long as the
assets subject to such sales, transfers or leases do not exceed
during the term of this Agreement more than 25% of the total
assets of the Borrower as reported on the balance sheet of the
Borrower as of December 31, 1994.
(d) Affiliate Transactions.
The Borrower shall not, and shall not permit any of its
Subsidiaries to, enter into or carry out any transaction
(including purchasing property or services from or selling
property or services to any Affiliate or the Borrower) unless
such transaction is entered into in the ordinary course of
business upon fair and reasonable arm's-length terms and
conditions, provided that, notwithstanding the foregoing, so long
as no Event of Default exists or would result and be continuing,
to the extent permitted by applicable Law, the Borrower and any
of its Subsidiaries may declare or pay dividends on their capital
stock.
(e) Continuation of Business.
The Borrower shall not, and shall not permit any of its
Significant Subsidiaries to, engage in any business other than
that of a public utility and any business related thereto.
(f) Subsidiaries, Partnerships
and Joint Ventures. The Borrower shall not own or create
directly or indirectly any Significant Subsidiaries other than
any Significant Subsidiary which joins this Agreement as a
Guarantor pursuant to Section 11.18. The Borrower shall not
become or agree to become, directly or indirectly, a general
partner in any general partnership, a limited partner in a
limited partnership or a joint venturer in any joint venture
which constitutes a Significant Subsidiary unless such general
partnership, limited partnership or joint venture is a Guarantor.
8.03 Reporting Requirements.
The Borrower covenants and agrees that until payment in full of
the Revolving Credit Loans and Bid Loans and interest thereon,
satisfaction of all of the Borrower's other Obligations hereunder
and under the other Loan Documents and termination of the
Commitments, the Borrower will furnish or cause to be furnished
to the Agent and each of the Banks:
(a) Quarterly Financial
Statements. As soon as available and in any event within forty-
five (45) calendar days after the end of each of the first three
(3) fiscal quarters in each fiscal year, consolidated financial
statements of the Borrower and its Subsidiaries, consisting of a
consolidated balance sheet as of the end of such fiscal quarter
and related consolidated statements of income, stockholders'
equity and cash flows for the fiscal quarter then ended and the
fiscal year through that date (which requirement shall be deemed
satisfied by the delivery of the Borrower's Quarterly Report on
Form 10-Q (or any successor form) for such year), all in
reasonable detail and certified (subject to normal year-end audit
adjustments) by the Chief Executive Officer, Chief Financial
Officer or Treasurer of the Borrower as having been prepared in
accordance with GAAP, consistently applied (except as stated
therein), and setting forth in comparative form the respective
financial statements for the corresponding date and period in the
previous fiscal year.
(b) Annual Financial
Statements. As soon as available and in any event within ninety
(90) days after the end of each fiscal year of the Borrower,
financial statements of the Borrower and its Subsidiaries
consisting of consolidated and consolidating balance sheets as
of the end of such fiscal year, and related consolidated and
consolidating statements of income, stockholders' equity and cash
flows for the fiscal year then ended (which requirement shall be
deemed satisfied by the delivery of the Borrower's Annual Report
on Form 10-K (or any successor form) for such quarter), all in
reasonable detail and setting forth in comparative form the
financial statements as of the end of and for the preceding
fiscal year, and such consolidated financial statements shall be
certified by independent certified public accountants of
nationally recognized standing.
(c) Certificate of the
Borrower. Concurrently with the financial statements of the
Borrower furnished to the Agent and to the Banks pursuant to
Sections 8.03(a) and 8.03(b), a certificate of the Borrower
signed by the Chief Executive Officer, Chief Financial Officer or
Treasurer of the Borrower, except as described in Schedule 7.02
or pursuant to Section 8.03(d) or otherwise in such certificate,
(i) the representations and warranties of the Borrower contained
in Article VI are true on and as of the date of such certificate
with the same effect as though such representations and
warranties had been made on and as of such date (except
representations and warranties which expressly relate solely to
an earlier date or time) and the Borrower has performed and
complied with all covenants and conditions hereof, and (ii) no
Event of Default or Potential Default exists and is continuing on
the date of such certificate.
(d) Notice of Default.
Promptly after any Authorized Officer or executive officer of the
Borrower has learned of the occurrence of an Event of Default or
Potential Default, a certificate signed by the Chief Executive
Officer, Chief Financial Officer or Treasurer of the Borrower
setting forth the details of such Event of Default or Potential
Default and the action which the Borrower proposes to take with
respect thereto.
(e) Notice of Litigation.
Promptly after the commencement thereof, notice of all actions,
suits, proceedings or investigations before or by any Official
Body or any other Person against the Borrower or any of its
Subsidiaries which involve a claim or series of claims which if
adversely determined could reasonably be expected to constitute a
Material Adverse Change.
(f) Notice of Certain ERISA
Matters. Promptly after (i) the occurrence thereof, notice of
any ERISA Termination Event or "prohibited transaction," as such
term is defined in Section 4975 of the Internal Revenue Code,
with respect to any Plan that results, or could reasonably be
anticipated to result, in a Material Adverse Change, which notice
shall specify the nature thereof and the Borrower's proposed
response thereto, and (ii) actual knowledge thereof, copies of
any notice of the PBGC's intention to terminate or to have a
trustee appointed to administer any Plan.
(g) Other Reports and
Information. Promptly upon their becoming available to the
Borrower:
(i) any reports,
notices or proxy statements generally distributed by the Borrower
to its security holders on a date no later than the date supplied
to the security holders,
(ii) regular or
periodic reports, including Forms 10-K, 10-Q and 8-K,
registration statements and prospectuses, filed by the Borrower
with the Securities and Exchange Commission, and
(iii) any additional
orders of the FERC, or any amendments, modifications or
supplements thereto, relating to the incurrence by the Borrower
of short-term debt; and
(iv) such other
reports and information as the Banks may from time to time
reasonably request. The Borrower shall also notify the Banks
promptly of the enactment or adoption of any Law which may result
in a Material Adverse Change.
ARTICLE IX
DEFAULT
9.01 Events of Default. An Event of
Default shall mean the occurrence or existence of any one or more
of the following events or conditions (whatever the reason
therefor and whether voluntary, involuntary or effected by
operation of Law):
(a) The Borrower shall
fail to pay (i) any principal of any Revolving Credit Loan or Bid
Loan (including scheduled installments, mandatory prepayments or
the payment due at maturity) as any such Loan becomes due in
accordance with the terms hereof or of any Loan Document or (ii)
shall fail to pay any interest on any Loan, any Facility Fees,
any Agent's Fee or any other amount owing hereunder or under the
other Loan Documents within three (3) Business Days after the due
date thereof;
(b) Any representation
or warranty made at any time by the Borrower or a Significant
Subsidiary herein or in any other Loan Document, or in any
certificate, other instrument or statement furnished by the
Borrower or a Significant Subsidiary pursuant to the provisions
hereof or thereof, shall have been false or misleading in any
material respect as of the time it was made or furnished;
(c) The Borrower shall
default in the observance or performance of any covenant
contained in Section 8.02 or Section 8.03(d);
(d) The Borrower or
any Significant Subsidiary shall default in the observance or
performance of any other covenant, condition or provision hereof
or of any other Loan Document, and such default shall continue
unremedied for a period of thirty (30) days after any Authorized
Officer or other executive officer of the Borrower or such
Significant Subsidiary knows or should have known of such default
(such grace period to be applicable only in the event such
default can be remedied by corrective action of the Borrower as
determined by the Agent in its sole discretion);
(e) A default or event
of default shall occur at any time under the terms of any other
agreement, including without limitation the First Mortgage Bond
Indenture, involving borrowed money or the extension of credit or
any other Indebtedness under which the Borrower or any of its
Significant Subsidiaries may be obligated as a borrower for in
excess of $25,000,000 in the aggregate, and (i) such breach,
default or event of default continues (beyond any period of grace
permitted with respect thereto), and permits the acceleration of
any Indebtedness or the termination of any commitment to lend, or
(ii) causes the acceleration of any Indebtedness or termination
of any commitment to lend;
(f) Any final judgments
or orders for the payment of money shall be entered against the
Borrower or any of its Significant Subsidiaries by a court having
jurisdiction in the premises which judgment is not discharged,
vacated, bonded or stayed pending appeal within a period of
thirty (30) days from the date of entry if the aggregate amount
of all such judgments and orders entered within any twelve- (12-)
month period exceeds by more than $25,000,000 the portion of such
judgments or orders covered by binding contracts of insurance and
such coverage is not being disputed by the insurance carrier and
such insurance carrier is either rated "A" or better by A.M.
Best's or is otherwise acceptable to the Required Banks;
(g) Any of the Loan
Documents shall cease to be legal, valid and binding agreements
enforceable against the Borrower or the Borrower's successors and
assigns (as permitted under the Loan Documents) in accordance
with the respective terms thereof or shall in any way be
terminated (except in accordance with its terms) or become or be
declared ineffective or inoperative or the legality, validity or
binding nature of any of the Loan Documents shall in any way be
challenged or contested by the Borrower or any of its
Subsidiaries or any of the Loan Documents cease to give or
provide the respective rights, titles, interests, remedies,
powers or privileges intended to be created thereby;
(h) Assets of the Borrower
or any of its Significant Subsidiaries the aggregate book value
of which exceeds collectively $25,000,000 are attached, seized,
levied upon or subjected to a writ or distress warrant; or such
come within the possession of any receiver, trustee, custodian or
assignee for the benefit of creditors and the same is not cured
within thirty (30) days thereafter;
(i) A notice of an
assessment in excess of $25,000,000 which is not a Permitted Lien
is filed of record with respect to all or any part of any of the
assets of the Borrower or any of its Significant Subsidiaries by
the United States, or any department, agency or instrumentality
thereof, or by any state, county, municipal or other governmental
agency, including the PBGC, or if any taxes or debts in excess of
$25,000,000 owing at any time or times hereafter to any one of
these becomes payable and the same is not paid within thirty (30)
days after the same becomes payable;
(j) The Borrower or any
Significant Subsidiary ceases to be solvent or admits in writing
its inability or is generally unable to pay its debts as they
mature;
(k) The Borrower or any
Significant Subsidiary ceases to conduct business (other than as
permitted by Section 8.02(b) or (c)) or the Borrower or any
Significant Subsidiary is enjoined, restrained or in any way
prevented by court order from conducting all or any material part
of its business and such injunction, restraint or other
preventive order is not dismissed within thirty (30) days after
the entry thereof;
(l) Any of the
following occurs: (i) any Reportable Event, which the Agent
determines in good faith constitutes grounds for the termination
of any Plan by the PBGC or the appointment of a trustee to
administer or liquidate any Plan, shall have occurred and be
continuing; (ii) proceedings shall have been instituted or other
action taken to terminate any Plan, or a termination notice shall
have been filed with respect to any Plan; (iii) a trustee shall
be appointed to administer or liquidate any Plan; (iv) the PBGC
shall give notice of its intent to institute proceedings to
terminate any Plan or Plans or to appoint a trustee to administer
or liquidate any Plan; and, in the case of the occurrence of (i),
(ii), (iii) or (iv) above, the Agent determines in good faith
that the amount of the Borrower's liability is likely to exceed
10% of its tangible net worth; (v) the Borrower or any member of
the ERISA Group shall fail to make any contributions when due to
a Plan or a Multiemployer Plan; (vi) the Borrower or any member
of the ERISA Group shall make any amendment to a Plan with
respect to which security is required under Section 307 of ERISA;
(vii) the Borrower or any member of the ERISA Group shall
withdraw completely or partially from a Multiemployer Plan;
(viii) the Borrower or any member of the ERISA Group shall
withdraw (or shall be deemed under Section 4062(e) of ERISA to
withdraw) from a Multiple Employer Plan; or (ix) any applicable
Law is adopted, changed or interpreted by any Official Body with
respect to or otherwise affecting one or more Plans,
Multiemployer Plans or Benefit Arrangements and, with respect to
any of the events specified in (v), (vi), (vii), (viii) or (ix),
the Agent determines in good faith that any such occurrence would
be reasonably likely to materially and adversely affect the total
enterprise represented by the Borrower and the other members of
the ERISA Group;
(m) The Borrower shall
fail to register under the Public Utility Holding Company Act of
1935, if required, or the Borrower shall fail to comply with any
material requirement of such Act;
(n) A proceeding shall
have been instituted in a court having jurisdiction in the
premises seeking a decree or order for relief in respect of the
Borrower or any Significant Subsidiary in an involuntary case
under any applicable bankruptcy, insolvency, reorganization or
other similar law now or hereafter in effect, or for the
appointment of a receiver, liquidator, assignee, custodian,
trustee, sequestrator, conservator (or similar official) of the
Borrower for any substantial part of its property, or for the
winding-up or liquidation of its affairs, and such proceeding
shall remain undismissed or unstayed and in effect for a period
of sixty (60) consecutive days or such court shall enter a decree
or order granting any of the relief sought in such proceeding; or
(o) The Borrower or
any Significant Subsidiary shall commence a voluntary case under
any applicable bankruptcy, insolvency, reorganization or other
similar law now or hereafter in effect, shall consent to the
entry of an order for relief in an involuntary case under any
such law, or shall consent to the appointment or taking
possession by a receiver, liquidator, assignee, custodian,
trustee, sequestrator, conservator (or other similar official) of
itself or for any substantial part of its property or shall make
a general assignment for the benefit of creditors, or shall fail
generally to pay its debts as they become due, or shall take any
action in furtherance of any of the foregoing.
9.02 Consequences of Event of Default.
(a) If an Event of Default
specified under subsections (a) through (m) of Section 9.01 shall
occur and be continuing, the Banks and the Agent shall be under
no further obligation to make Revolving Credit Loans or Bid
Loans, as the case may be, and the Agent may, and upon the
request of the Required Banks, shall by written notice to the
Borrower take one or both of the following actions: (i)
terminate the Commitments and thereupon the Commitments shall be
terminated and of no further force and effect or (ii) declare the
unpaid principal amount of the Revolving Credit Notes then
outstanding and all interest accrued thereon, any unpaid fees and
all other Indebtedness of the Borrower to the Banks hereunder and
thereunder to be forthwith due and payable, and the same shall
thereupon become and be immediately due and payable to the Agent
for the benefit of each Bank without presentment, demand, protest
or any other notice of any kind, all of which are hereby
expressly waived; and
(b) If an Event of Default
specified under subsections (n) or (o) of Section 9.01 shall
occur, the Commitments shall automatically terminate and be of no
further force and effect, the Banks shall be under no further
obligations to make Revolving Credit Loans or Bid Loans hereunder
and the unpaid principal amount of the Revolving Credit Notes
then outstanding and all interest accrued thereon, any unpaid
fees and all other Indebtedness of the Borrower to the Banks
hereunder and thereunder shall be immediately due and payable,
without presentment, demand, protest or notice of any kind, all
of which are hereby expressly waived; and
(c) If an Event of
Default shall occur and be continuing, any Bank to whom any
Obligation is owed by the Borrower hereunder or under any other
Loan Document or any participant of such Bank which has agreed in
writing to be bound by the provisions of Section 10.13 and any
branch, Subsidiary or Affiliate of such Bank or participant
anywhere in the world shall have the right, in addition to all
other rights and remedies available to it, without notice to the
Borrower, to set off against and apply to the then-unpaid balance
of all the Loans and all other Obligations of the Borrower
hereunder or under any other Loan Document any debt owing to, and
any other funds held in any manner for the account of, the
Borrower by such Bank or participant or by such branch,
Subsidiary or Affiliate, including all funds in all deposit
accounts (whether time or demand, general or special,
provisionally credited or finally credited, or otherwise) now or
hereafter maintained by the Borrower for its own account (but not
including funds held in custodian or trust accounts) with such
Bank or participant or such branch, Subsidiary or Affiliate;
provided, that any such Bank or any such branch, Subsidiary or
Affiliate of such Bank or such participant shall use reasonable
efforts to notify the Borrower thereof promptly after such set-
off and application; provided, further, that the failure of any
such Bank or any such branch, Subsidiary or Affiliate of such
Bank or such participant to so notify the Borrower shall not,
under any circumstances, result in any liability to the party
failing to provide such notice. Such right shall exist whether
or not any Bank or the Agent shall have made any demand under
this Agreement or any other Loan Document, whether or not such
debt owing to or funds held for the account of the Borrower is or
are matured or unmatured and regardless of the existence or
security, right or remedy available to any Bank or the Agent; and
(d) If an Event of
Default shall occur and be continuing, and whether or not the
Agent shall have accelerated the maturity of Revolving Credit
Loans to the Borrower pursuant to any of the foregoing provisions
of this Section 9.02, the Agent or any Bank, if owed any amount
with respect to the Revolving Credit Notes, may proceed to
protect and enforce its rights by suit in equity, action at law
and/or other appropriate proceeding, whether for the specific
performance of any covenant or agreement contained in this
Agreement or the Revolving Credit Notes, including as permitted
by applicable Law the obtaining of the ex parte appointment of a
receiver, and, if such amount shall have become due, by
declaration or otherwise, proceed to enforce the payment thereof
or any other legal or equitable right of the Agent or such Bank;
and
(e) From and after
the date on which the Agent has taken any action pursuant to this
Section 9.02 and until all Obligations of the Borrower have been
paid in full, or any part thereof, or the exercise of any other
remedy by the Agent, payments received or other collections
hereunder or under the Loan Documents shall be applied as
follows:
(i) first, to
reimburse the Agent and the Banks for out-of-pocket costs,
expenses and disbursements, including reasonable attorneys' and
paralegals' fees and legal expenses, incurred by the Agent or the
Banks in connection with collection of any Obligations of the
Borrower under any of the Loan Documents;
(ii) second, to the
repayment of all Indebtedness then due and unpaid of the Borrower
to the Banks incurred under this Agreement or any of the Loan
Documents, whether of principal, interest, fees, expenses or
otherwise, in such manner as the Agent may determine in its
discretion; and
(iii) the
balance, if any, as required by Law; and
(f) In addition to all of
the rights and remedies contained in this Agreement or in any of
the other Loan Documents, the Agent and the Banks shall have all
of the rights and remedies under applicable Law, all of which
rights and remedies shall be cumulative and non-exclusive, to the
extent permitted by Law. The Agent may, and upon the request of
the Required Banks shall, exercise all post-default rights
granted to the Agent and the Banks under the Loan Documents or
applicable Law.
9.03 Right of Competitive Bid
Loan Banks. If any Event of Default shall occur and be
continuing, the Banks which have any Bid Loans then outstanding
to the Borrower (the "Bid Loan Banks") shall not be entitled to
accelerate payment of the Bid Loans or to exercise any right or
remedy related to the collection of the Bid Loans until the
Commitments shall be terminated hereunder pursuant to
Sections 9.02(a) or (b). Upon such a termination of the
Commitments: (i) references to Revolving Credit Loans in Section
9.02 shall be deemed to apply also to the Bid Loans and the Bid
Loan Banks shall be entitled to all enforcement rights given to a
holder of a Revolving Credit Loan in Section 9.02; and (ii) the
definition of Required Banks shall be changed as provided in
Section 1.01 so that each Bank shall have voting rights hereunder
in proportion to its share of the total Loans outstanding.
ARTICLE X
THE AGENT
10.01 Appointment. Each
Bank hereby irrevocably designates, appoints and authorizes PNC
Bank to act as Agent for such Bank under this Agreement to
execute and deliver or accept on behalf of each of the Banks the
other Loan Documents. Each Bank hereby irrevocably authorizes,
and each holder of any Revolving Credit Note or Bid Note by the
acceptance of a Revolving Credit Note or Bid Note shall be deemed
irrevocably to authorize, the Agent to take such action on its
behalf under the provisions of this Agreement and the other Loan
Documents and any other instruments and agreements referred to
herein, and to exercise such powers and to perform such duties
hereunder as are specifically delegated to or required of the
Agent by the terms hereof, together with such powers as are
reasonably incidental thereto. PNC Bank agrees to act as the
Agent on behalf of the Banks to the extent provided in this
Agreement.
10.02 Delegation of Duties.
The Agent may perform any of its duties hereunder by or through
agents or employees (provided such delegation does not constitute
a relinquishment of its duties as Agent) and, subject to Sections
10.05 and 10.06, shall be entitled to engage and pay for the
advice or services of any attorneys, accountants or other experts
concerning all matters pertaining to its duties hereunder and to
rely upon any advice so obtained.
10.03 Nature of Duties;
Independent Credit Investigation. The Agent shall have no duties
or responsibilities except those expressly set forth in this
Agreement and no implied covenants, functions, responsibilities,
duties, obligations, or liabilities shall be read into this
Agreement or otherwise exist. The duties of the Agent shall be
mechanical and administrative in nature; the Agent shall not have
by reason of this Agreement a fiduciary or trust relationship in
respect of any Bank; and nothing in this Agreement, expressed or
implied, is intended to or shall be so construed as to impose
upon the Agent any obligations in respect of this Agreement
except as expressly set forth herein. Each Bank expressly
acknowledges (i) that the Agent has not made any representations
or warranties to it and that no act by the Agent hereafter taken,
including any review of the affairs of the Borrower, shall be
deemed to constitute any representation or warranty by the Agent
to any Bank; (ii) that it has made and will continue to make,
without reliance upon the Agent, its own independent
investigation of the financial condition and affairs and its own
appraisal of the creditworthiness of the Borrower in connection
with this Agreement and the making and continuance of the Loans
hereunder; and (iii) except as expressly provided herein, that
the Agent shall have no duty or responsibility, either initially
or on a continuing basis, to provide any Bank with any credit or
other information with respect thereto, whether coming into its
possession before the making of any Loan or at any time or times
thereafter.
10.04 Actions in Discretion
of the Agent; Instructions from the Banks. The Agent agrees,
upon the written request of the Required Banks, to take or
refrain from taking any action of the type specified as being
within the Agent's rights, powers or discretion herein, provided
that the Agent shall not be required to take any action which
exposes the Agent to personal liability or which is contrary to
this Agreement or any other Loan Document or applicable Law. In
the absence of a request by the Required Banks, the Agent shall
have authority, in its sole discretion, to take or not to take
any such action, unless this Agreement specifically requires the
consent of the Required Banks or all of the Banks. Any action
taken or failure to act pursuant to such instructions or
discretion shall be binding on the Banks, subject to Section
10.06. Subject to the provisions of Section 10.06, no Bank shall
have any right of action whatsoever against the Agent as a result
of the Agent acting or refraining from acting hereunder in
accordance with the instructions of the Required Banks, or in the
absence of such instructions, in the absolute discretion of the
Agent.
10.05 Reimbursement and
Indemnification of the Agent by the Borrower. The Borrower
unconditionally agrees to pay or reimburse the Agent and save the
Agent harmless against (a) liability for the payment of all
reasonable out-of-pocket costs, expenses and disbursements,
including fees and expenses of counsel, appraisers and
environmental consultants, incurred by the Agent (i) in
connection with the development, negotiation, preparation,
printing, execution, administration, syndication, interpretation
and performance of this Agreement and the other Loan Documents,
(ii) relating to any requested amendments, waivers or consents
pursuant to the provisions hereof, (iii) in connection with the
enforcement of this Agreement or any other Loan Document or
collection of amounts due hereunder or thereunder or the proof
and allowability of any claim arising under this Agreement or any
other Loan Document, whether in bankruptcy or receivership
proceedings or otherwise, and (iv) in any workout or
restructuring or in connection with the protection, preservation,
exercise or enforcement of any of the terms hereof or of any
rights hereunder or under any other Loan Document or in
connection with any foreclosure, collection or bankruptcy
proceedings, and (b) all liabilities, obligations, losses,
damages, penalties, actions, judgments, suits, costs, expenses or
disbursements of any kind or nature whatsoever which may be
imposed on, incurred by or asserted against the Agent, in its
capacity as such, in any way relating to or arising out of this
Agreement or any other Loan Documents or any action taken or
omitted by the Agent hereunder or thereunder, provided that the
Borrower shall not be liable for any portion of such liabilities,
obligations, losses, damages, penalties, actions, judgments,
suits, costs, expenses or disbursements if the same results from
the Agent's negligence or willful misconduct, or if the Borrower
was not given notice of the subject claim and the opportunity to
participate in the defense thereof, at its expense (except that
the Borrower shall remain liable to the extent such failure to
give notice does not result in a loss to the Borrower), or if the
same results from a compromise or settlement agreement entered
into without the consent of the Borrower, which shall not be
unreasonably withheld. In addition, the Borrower agrees to
reimburse and pay all reasonable out-of-pocket expenses of the
Agent's regular employees and agents engaged periodically to
perform audits of the Borrower's books, records and business
properties permitted under Section 8.01(e).
10.06 Exculpatory Provisions.
Neither the Agent nor any of its directors, officers, employees,
agents, attorneys or Affiliates shall (a) be liable to any Bank
for any action taken or omitted to be taken by it or them
hereunder, or in connection herewith, including pursuant to any
Loan Document, unless caused by its or their own gross negligence
or willful misconduct, (b) be responsible in any manner to any of
the Banks for the effectiveness, enforceability, genuineness,
validity or due execution of this Agreement or any other Loan
Documents or for any recital, representation, warranty, document,
certificate, report or statement herein or made or furnished
under or in connection with this Agreement or any other Loan
Documents, or (c) be under any obligation to any of the Banks to
ascertain or to inquire as to the performance or observance of
any of the terms, covenants or conditions hereof or thereof on
the part of the Borrower, or the financial condition of the
Borrower, or the existence or possible existence of any Event of
Default or Potential Default. Neither the Agent nor any Bank nor
any of their respective directors, officers, employees, agents,
attorneys or Affiliates shall be liable to the Borrower for
consequential damages resulting from any breach of contract, tort
or other wrong in connection with the negotiation, documentation,
administration or collection of the Loans or any of the Loan
Documents.
10.07 Reimbursement and
Indemnification of Agent by Banks. Each Bank agrees to reimburse
and indemnify the Agent (to the extent not reimbursed by the
Borrower and without limiting the Obligation of the Borrower to
do so) in proportion to its Ratable Share from and against all
liabilities, obligations, losses, damages, penalties, actions,
judgments, suits, costs, expenses or disbursements of any kind or
nature whatsoever which may be imposed on, incurred by or
asserted against the Agent, in its capacity as such, in any way
relating to or arising out of this Agreement or any other Loan
Documents or any action taken or omitted by the Agent hereunder
or thereunder, provided that no Bank shall be liable for any
portion of such liabilities, obligations, losses, damages,
penalties, actions, judgments, suits, costs, expenses or
disbursements (a) if the same results from the Agent's negligence
or willful misconduct, or (b) if such Bank was not given notice
of the subject claim and the opportunity to participate in the
defense thereof, at its expense (except that such Bank shall
remain liable to the extent such failure to give notice does not
result in a loss to the Bank), or (c) if the same results from a
compromise and settlement agreement entered into without the
consent of such Bank, which shall not be unreasonably withheld.
In addition, each Bank agrees promptly upon demand to reimburse
the Agent (to the extent not reimbursed by the Borrower and
without limiting the Obligation of the Borrower to do so) in
proportion to its Ratable Share for all amounts due and payable
by the Borrower to the Agent in connection with the Agent's
periodic audit of the Borrower's books, records and business
properties.
10.08 Reliance by Agent.
The Agent shall be entitled to rely upon any writing, telegram,
telex or teletype message, resolution, notice, consent,
certificate, letter, cablegram, statement, order or other
document or conversation by telephone or otherwise believed by it
to be genuine and correct and to have been signed, sent or made
by the proper Person or Persons, and upon the advice and opinions
of counsel and other professional advisers selected by the Agent.
The Agent shall be fully justified in failing or refusing to take
any action hereunder unless it shall first be indemnified to its
satisfaction by the Banks against any and all liability and
expense which may be incurred by it by reason of taking or
continuing to take any such action.
10.09 Notice of Default.
The Agent shall not be deemed to have knowledge or notice of the
occurrence of any Potential Default or Event of Default unless
the Agent has received written notice from a Bank or the Borrower
referring to this Agreement, describing such Potential Default or
Event of Default and stating that such notice is a "notice of
default."
10.10 Notices. The Agent
shall promptly send to each Bank a copy of each notice received
from the Borrower pursuant to the provisions of this Agreement or
the other Loan Documents promptly upon receipt thereof. The
Agent shall promptly notify the Borrower and the other Banks of
each change in the Base Rate and the effective date thereof.
10.11 Banks in Their
Individual Capacities. With respect to its Commitments, the
Revolving Credit Loans and any Bid Loans made by it, the Agent
shall have the same rights and powers hereunder as any other Bank
and may exercise the same as though it were not the Agent, and
the term "Banks" shall, unless the context otherwise indicates,
include the Agent in its individual capacity. PNC Bank and its
Affiliates and each of the Banks and their respective Affiliates
may, without liability to account, except as prohibited herein,
make loans to, accept deposits from, discount drafts for, act as
trustee under indentures of, and generally engage in any kind of
banking or trust business with, the Borrower and its Affiliates,
in the case of the Agent, as though it were not acting as Agent
hereunder and in the case of each Bank, as though such Bank were
not a Bank hereunder.
10.12 Holders of Notes.
The Agent may deem and treat any payee of any Note as the owner
thereof for all purposes hereof unless and until written notice
of the assignment or transfer thereof shall have been filed with
the Agent. Any request, authority or consent of any Person who
at the time of making such request or giving such authority or
consent is the holder of any Note shall be conclusive and binding
on any subsequent holder, transferee or assignee of such Note or
of any Note or Notes issued in exchange therefor.
10.13 Equalization of Banks.
The Banks and the holders of any participations in any Notes
agree among themselves that, with respect to all amounts received
by any Bank or any such holder for application on any Obligation
hereunder or under any Note or under any such participation,
whether received by voluntary payment, by realization upon
security, by the exercise of the right of set-off or banker's
lien, by counterclaim or by any other non-pro rata source,
equitable adjustment will be made in the manner stated in the
following sentence so that, in effect, all such excess amounts
will be shared ratably among the Banks and such holders in
proportion to their interests in payments under the Notes, except
as otherwise provided in Sections 4.04(b), 5.04(b) or 5.05. The
Banks or any such holder receiving any such amount shall purchase
for cash from each of the other Banks an interest in such Bank's
Loans in such amount as shall result in a ratable participation
by the Banks and each such holder in the aggregate unpaid amount
under the Notes, provided that if all or any portion of such
excess amount is thereafter recovered from the Bank or the holder
making such purchase, such purchase shall be rescinded and the
purchase price restored to the extent of such recovery, together
with interest or other amounts, if any, required by law
(including court order) to be paid by the Bank or the holder
making such purchase.
10.14 Successor Agent.
The Agent (i) may resign as Agent or (ii) shall resign if such
resignation is requested by the Required Banks (if the Agent is a
Bank, the Agent's Loans and its Commitment shall be considered in
determining whether the Required Banks have requested such
resignation) or required by Section 5.04(b), in either case of
(i) or (ii) by giving not less than thirty (30) days' prior
written notice to the Borrower. If the Agent shall resign under
this Agreement, then either (a) the Required Banks shall appoint
from among the Banks a successor agent for the Banks, subject to
the consent of the Borrower, such consent not to be unreasonably
withheld, or (b) if a successor agent shall not be so appointed
and approved within the thirty (30) day period following the
Agent's notice to the Banks of its resignation, then the Agent
shall appoint, with the consent of the Borrower, such consent not
to be unreasonably withheld, a successor agent who shall serve as
Agent until such time as the Required Banks appoint and the
Borrower consents to the appointment of a successor agent. Any
successor agent shall be a Bank or a commercial bank incorporated
under the laws of the United States of America with capital and
surplus of not less than $150,000,000. Upon its appointment
pursuant to either clause (a) or (b) above, such successor agent
shall succeed to the rights, powers and duties of the Agent and
the term "Agent" shall mean such successor agent, effective upon
its appointment, and the former Agent's rights, powers and duties
as Agent shall be terminated without any other or further act or
deed on the part of such former Agent or any of the parties to
this Agreement. After the resignation of any Agent hereunder,
the provisions of this Article X shall inure to the benefit of
such former Agent and such former Agent shall not by reason of
such resignation be deemed to be released from liability for any
actions taken or not taken by it while it was an Agent under this
Agreement.
10.15 Agent's Fees.
The Borrower shall pay to the Agent a nonrefundable fee (the "Bid
Loan Processing Fee") in connection with the processing of each
Bid Loan and a non-refundable fee (the "Agent's Fee") for Agent's
other services hereunder in accordance with a letter or other
agreement between the Agent and the Borrower.
10.16 Availability of Funds.
Unless the Agent shall have been notified by a Bank prior to the
date upon which a Loan is to be made that such Bank does not
intend to make available to the Agent such Bank's portion of such
Loan, the Agent may assume that such Bank has made or will make
such proceeds available to the Agent on such date and the Agent
may, in reliance upon such assumption (but shall not be required
to), make available to the Borrower a corresponding amount. If
such corresponding amount is not in fact made available to the
Agent by such Bank, the Agent shall be entitled to recover such
amount on demand from such Bank (or, if such Bank fails to pay
such amount forthwith upon such demand from the Borrower)
together with interest thereon, in respect of each day during the
period commencing on the date such amount was made available to
the Borrower and ending on the date the Agent recovers such
amount, at a rate per annum equal to the applicable interest rate
in respect of such Loan and upon such recovery by the Agent from
such Bank, such Bank shall be entitled to the interest payable by
the Borrower on such Loan during the foregoing time period.
10.17 Calculations. In
the absence of gross negligence or willful misconduct, the Agent
shall not be liable for any error in computing the amount payable
to any Bank whether in respect of the Loans, fees or any other
amounts due to the Banks under this Agreement. In the event an
error in computing any amount payable to any Bank is made, the
Agent, the Borrower and each affected Bank shall, forthwith upon
discovery of such error, make such adjustments as shall be
required to correct such error, and any compensation therefor
will be calculated at the Federal Funds Effective Rate.
10.18 Beneficiaries. Except
as expressly provided herein, the provisions of this Article X
are solely for the benefit of the Agent and the Banks, and the
Borrower shall not have any rights to rely on or enforce any of
the provisions hereof. In performing its functions and duties
under this Agreement, the Agent shall act solely as agent of the
Banks and does not assume and shall not be deemed to have assumed
any obligation toward or relationship of agency or trust with or
for the Borrower.
ARTICLE XI
MISCELLANEOUS
11.01 Modifications, Amendments
or Waivers. With the written consent of the Required Banks, the
Agent, acting on behalf of all the Banks, and the Borrower may
from time to time enter into written agreements amending or
changing any provision of this Agreement or any other Loan
Document or the rights of the Banks or the Borrower hereunder or
thereunder, or may grant written waivers or consents to a
departure from the due performance of the Obligations of the
Borrower hereunder or thereunder. Any such agreement, waiver or
consent made with such written consent shall be effective to bind
all the Banks, the Agent and the Borrower; provided, that,
without the written consent of all the Banks, no such agreement,
waiver or consent may be made which will:
(a) increase the amount of
the Commitment of any Bank hereunder or extend the Expiration
Date;
(b) whether or not any Loans
are outstanding, extend the time for payment of principal or
interest of any Loan, the Facility Fee or any other fee payable
to any Bank, or reduce the principal amount of or the rate of
interest borne by any Loan or reduce the Facility Fee or any
other fee payable to any Bank, or otherwise affect the terms of
payment of the principal of or interest of any Loan, the Facility
Fee or any other fee payable to any Bank; or
(c) amend Sections 5.02
[Pro Rata Treatment of Banks], 10.06 [Exculpatory Provisions] or
10.13 [Equalization of Banks] or this Section 11.01, alter any
provision regarding the pro rata treatment of the Banks, change
the definition of Required Banks, or change any requirement
providing for the Banks or the Required Banks to authorize the
taking of any action hereunder.
No agreement, waiver or consent
which would modify the interests, rights or obligations of the
Agent in its capacity as Agent shall be effective without the
written consent of the Agent.
11.02 No Implied
Waivers; Cumulative Remedies; Writing Required. No course of
dealing and no delay or failure of the Agent or any Bank in
exercising any right, power, remedy or privilege under this
Agreement or any other Loan Document shall affect any other or
future exercise thereof or operate as a waiver thereof; nor shall
any single or partial exercise thereof or any abandonment or
discontinuance of steps to enforce such a right, power, remedy or
privilege preclude any further exercise thereof or of any other
right, power, remedy or privilege. The rights and remedies of
the Agent and the Banks under this Agreement and any other Loan
Documents are cumulative and not exclusive of any rights or
remedies which they would otherwise have. Any waiver, permit,
consent or approval of any kind or character on the part of any
Bank of any breach or default under this Agreement or any such
waiver of any provision or condition of this Agreement must be in
writing and shall be effective only to the extent specifically
set forth in such writing.
11.03 Reimbursement and
Indemnification of the Banks by the Borrower; Taxes. The
Borrower agrees unconditionally upon demand to pay or reimburse
to each Bank (other than the Agent, as to which the Borrower's
Obligations are set forth in Section 10.05) and to save such Bank
harmless against (i) liability for the payment of all reasonable
out-of-pocket costs, expenses and disbursements (including fees
and expenses of counsel for each Bank except with respect to (a)
and (b) below), incurred by such Bank (a) in connection with the
administration and interpretation of this Agreement, and other
instruments and documents to be delivered hereunder, (b) relating
to any amendments, waivers or consents pursuant to the provisions
hereof, (c) in connection with the enforcement of this Agreement
or any other Loan Document, or collection of amounts due
hereunder or thereunder or the proof and allowability of any
claim arising under this Agreement or any other Loan Document,
whether in bankruptcy or receivership proceedings or otherwise,
and (d) in any workout or restructuring or in connection with the
protection, preservation, exercise or enforcement of any of the
terms hereof or of any rights hereunder or under any other Loan
Document or in connection with any foreclosure, collection or
bankruptcy proceedings, or (ii) 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 such Bank, in
its capacity as such, in any way relating to or arising out of
this Agreement or any other Loan Documents or any action taken or
omitted by such Bank hereunder or thereunder or the actual or
proposed use of proceeds of the Loans, provided that the Borrower
shall not be liable for any portion of such liabilities,
obligations, losses, damages, penalties, actions, judgments,
suits, costs, expenses or disbursements (A) if the same results
from such Bank's negligence or willful misconduct, or (B) if the
Borrower was not given notice of the subject claim and the
opportunity to participate in the defense thereof, at its expense
(except that the Borrower shall remain liable to the extent such
failure to give notice does not result in a loss to the
Borrower), or (C) if the same results from a compromise or
settlement agreement entered into without the consent of the
Borrower, which shall not be unreasonably withheld. The Banks
will attempt to minimize the fees and expenses of legal counsel
for the Banks which are subject to reimbursement by the Borrower
hereunder by considering the usage of one law firm to represent
the Banks and the Agent if appropriate under the circumstances.
The Borrower agrees unconditionally to pay all stamp, document,
transfer, recording or filing taxes or fees and similar
impositions now or hereafter determined by the Agent or any Bank
to be payable in connection with this Agreement or any other Loan
Document, and the Borrower agrees unconditionally to save the
Agent and the Banks harmless from and against any and all present
or future claims, liabilities or losses with respect to or
resulting from any omission to pay or delay in paying any such
taxes, fees or impositions.
11.04 Holidays. Whenever
payment of a Loan to be made or taken hereunder shall be due on a
day which is not a Business Day, such payment shall be due on the
next following Business Day and such extension of time shall be
included in computing interest and fees, except that the Loans
shall be due on the Business Day preceding the Expiration Date if
the Expiration Date is not a Business Day. Whenever any payment
or action to be made or taken hereunder (other than payment of
the Loans) shall be stated to be due on a day which is not a
Business Day, such payment or action shall be made or taken on
the next following Business Day (except as provided in Section
4.02(a) with respect to Interest Periods under the Euro-Rate
Option), and such extension of time shall not be included in
computing interest or fees, if any, in connection with such
payment or action.
11.05 Funding by Branch,
Subsidiary or Affiliate.
(a) Notional Funding. Each
Bank shall have the right from time to time, without notice to
the Borrower, to deem any branch, Subsidiary or Affiliate (which
for the purposes of this Section 11.05 shall mean any corporation
or association which is directly or indirectly controlled by or
is under direct or indirect common control with any corporation
or association which directly or indirectly controls such Bank)
of such Bank to have made, maintained or funded any Loan to which
the Euro-Rate Option applies at any time, provided that
immediately following (on the assumption that a payment were then
due from the Borrower to such other office) and as a result of
such change the Borrower would not be under any greater financial
obligation pursuant to Section 5.05 than it would have been in
the absence of such change. Notional funding offices may be
selected by each Bank without regard to such Bank's actual
methods of making, maintaining or funding the Loans or any
sources of funding actually used by or available to such Bank.
(b) Actual Funding. Each
Bank shall have the right from time to time to make or maintain
any Loan by arranging for a branch, Subsidiary or Affiliate of
such Bank to make or maintain such Loan subject to the last
sentence of this Section 11.05(b). If any Bank causes a branch,
Subsidiary or Affiliate to make or maintain any part of the Loans
hereunder, all terms and conditions of this Agreement shall,
except where the context clearly requires otherwise, be
applicable to such part of the Loans to the same extent as if
such Loans were made or maintained by such Bank but in no event
shall any Bank's use of such a branch, Subsidiary or Affiliate to
make or maintain any part of the Loans hereunder cause such Bank
or such branch, Subsidiary or Affiliate to incur any cost or
expenses payable by the Borrower hereunder or require the
Borrower to pay any other compensation to any Bank (including any
expenses incurred or payable pursuant to Section 5.05) which
would otherwise not be incurred.
11.06 Notices. All
notices, requests, demands, directions and other communications
(as used in this Section 11.06 collectively referred to as
"notices") given to or made upon any party hereto under the
provisions of this Agreement shall be by telephone or in writing
(including telex or facsimile communication) unless otherwise
expressly permitted hereunder and shall be delivered or sent by
telex or facsimile to the respective parties at the addresses and
numbers set forth under their respective names on the signature
pages hereof or in accordance with any subsequent unrevoked
written direction from any party to the others. All notices
shall, except as otherwise expressly herein provided, be
effective (a) in the case of telex or facsimile, when received,
(b) in the case of hand-delivered notice, when hand delivered,
(c) in the case of telephone, when telephoned, provided, however,
that in order to be effective, telephonic notices must be
confirmed in writing no later than the next day by letter,
facsimile or telex, (d) if given by mail, four (4) days after
such communication is deposited in the mails with first-class
postage prepaid, return receipt requested, and (e) if given by
any other means (including by air courier), when delivered;
provided, that notices to the Agent shall not be effective until
received. Any Bank giving any notice to Borrower shall
simultaneously send a copy thereof to the Agent, and the Agent
shall promptly notify the other Banks of the receipt by it of any
such notice.
11.07 Severability. The
provisions of this Agreement are intended to be severable. If
any provision of this Agreement shall be held invalid or
unenforceable in whole or in part in any jurisdiction such
provision shall, as to such jurisdiction, be ineffective to the
extent of such invalidity or unenforceability without in any
manner affecting the validity or enforceability thereof in any
other jurisdiction or the remaining provisions hereof in any
jurisdiction.
11.08 Governing Law. This
Agreement shall be deemed to be a contract under the Laws of the
Commonwealth of Kentucky and for all purposes shall be governed
by and construed and enforced in accordance with the internal
laws of the Commonwealth of Kentucky without regard to its
conflict of laws principles.
11.09 Prior Understanding.
This Agreement supersedes all prior understandings and
agreements, whether written or oral, between the parties hereto
and thereto relating to the transactions provided for herein,
including any prior confidentiality agreements and commitments,
except for the letter or other agreement referred to in Section
10.15.
11.10 Duration; Survival.
All representations and warranties of the Borrower contained
herein or made in connection herewith shall survive the making of
Loans and shall not be waived by the execution and delivery of
this Agreement, any investigation by the Agent or the Banks, the
making of Loans or payment in full of the Loans. All covenants
and agreements of the Borrower contained in Sections 8.01, 8.02
and 8.03 herein shall continue in full force and effect from and
after the date hereof so long as the Borrower may borrow and
until termination of the Commitments and payment in full of the
Revolving Credit Loans and Bid Loans. All covenants and
agreements of the Borrower contained herein relating to the
payment of principal, interest, premiums, additional compensation
or expenses and indemnification, including those set forth in the
Notes, Article V and Sections 10.05, 10.07 and 11.03, shall
survive payment in full of the Revolving Credit Loans and Bid
Loans, and termination of the Commitments.
11.11 Successors and Assigns.
This Agreement shall be binding upon and shall inure to the
benefit of the Banks, the Agent, the Borrower and their
respective successors and assigns, except that the Borrower may
not assign or transfer any of its rights and Obligations
hereunder or any interest herein without the consent of all of
the Banks. Each Bank may, at its own cost, make assignments of
or sell participations in all or any part of its Commitment and
the Revolving Credit Loans and Bid Loans made by it to one or
more banks or other entities, subject to the consent of the
Borrower and the Agent with respect to any assignee, such consent
not to be unreasonably withheld, and provided that (i) a Bank may
not assign a Commitment in an amount less than the lesser of
$5,000,000 or 100% of its Commitment, (ii) a Bank may assign an
interest or sell a participation in less than 100% of its
Commitments, Revolving Credit Loans or Bid Loans, provided that
such Bank sells an equal percentage interest or participation in
each of its Commitment and Revolving Credit Loans, and (iii) the
consent of the Agent and the Borrower shall not be necessary to
assign all or any part of a Bank's Commitment or Loans (A) to an
Affiliate of the assigning Bank or (B) to any Person after the
occurrence of an Event of Default and during the continuation
thereof. In the case of an assignment, upon receipt by the Agent
of the Assignment and Assumption Agreement, the assignee shall
have, to the extent of such assignment (unless otherwise provided
therein), the same rights, benefits and obligations as it would
have if it had been a signatory Bank hereunder, the Commitments
in Section 2.01 shall be adjusted accordingly, and upon surrender
of any Revolving Credit Note subject to such assignment, the
Borrower shall execute and deliver a new Revolving Credit Note to
the assignee in an amount equal to the amount of the Commitment
assumed by it and a new Revolving Credit Note to the assigning
Bank in an amount equal to the Commitment, if any, retained by it
hereunder. The assigning Bank shall surrender its Bid Note if it
is assigning 100% of its Commitment and Bid Loans. The Borrower
shall execute and deliver to the assignee a new Bid Note in the
form of Exhibit 1.01(B) in an amount equal to the Commitments.
The assigning Bank shall pay to the Agent a service fee in the
amount of $2,000 for each assignment. In the case of a
participation, the participant shall only have the rights
specified in Section 9.02(c) (the participant's rights against
such Bank in respect of such participation to be those set forth
in the agreement executed by such Bank in favor of the
participant relating thereto and not to include any voting rights
except with respect to changes of the type referenced in clauses
(a), (b), or (c) under Section 11.01), all of such Bank's
obligations under this Agreement or any other Loan Document shall
remain unchanged and all amounts payable by the Borrower
hereunder or thereunder shall be determined as if such Bank had
not sold such participation. Any assignee or participant which
is not incorporated under the Laws of the United States of
America or a state thereof shall deliver to the Borrower and the
Agent the form of certificate described in Section 11.17 relating
to federal income tax withholding. Each Bank may furnish any
publicly available information concerning the Borrower and any
other information concerning the Borrower in the possession of
such Bank from time to time to assignees and participants
(including prospective assignees or participants) provided that
such assignees and participants agree to be bound by the
provisions of Section 11.12. Notwithstanding any other language
in this Agreement, any Bank may at any time assign all or any
portion of its rights under this Agreement and its Notes to a
Federal Reserve Bank as collateral in accordance with
Regulation A and the applicable Operating Circular of such
Federal Reserve Bank.
11.12 Confidentiality. The
Agent and the Banks each agree to keep confidential all
information obtained from the Borrower which is nonpublic and
confidential or proprietary in nature (including any information
the Borrower specifically designates as confidential), except as
provided below, and to use such information only in connection
with their respective capacities under this Agreement and for the
purposes contemplated hereby. The Agent and the Banks shall be
permitted to disclose such information (i) to outside legal
counsel, accountants and other professional advisors who need to
know such information in connection with the administration and
enforcement of this Agreement, subject to agreement of such
Persons to maintain the confidentiality, (ii) to assignees and
participants as contemplated by Section 11.11, (iii) to the
extent requested by any bank regulatory authority or, with notice
to the Borrower (to the extent not legally prohibited from doing
so by statute, rule or regulation), as otherwise required by
applicable Law or by any subpoena or similar legal process, or in
connection with any litigation, investigation or proceeding
arising out of the transactions contemplated by this Agreement,
(iv) if it becomes publicly available other than as a result of a
breach of this Agreement or becomes available from a source not
known to such Bank to be subject to confidentiality restrictions,
or (v) if the Borrower shall have consented to such disclosure.
11.13 Counterparts. This
Agreement may be executed by different parties hereto on any
number of separate counterparts, each of which, when so executed
and delivered, shall be an original, and all such counterparts
shall together constitute one and the same instrument.
11.14 Agent's or Bank's Consent.
Whenever the Agent's or any Bank's consent is required to be
obtained under this Agreement or any of the other Loan Documents
as a condition to any action, inaction, condition or event, the
Agent and each Bank shall be authorized to give or withhold such
consent in its sole and absolute discretion and to condition its
consent upon the giving of additional collateral, the payment of
money or any other matter.
11.15 Exceptions. The
representations, warranties and covenants contained herein shall
be independent of each other and no exception to any
representation, warranty or covenant shall be deemed to be an
exception to any other representation, warranty or covenant
contained herein unless expressly provided, nor shall any such
exceptions be deemed to permit any action or omission that would
be in contravention of applicable Law.
11.16 CONSENT TO FORUM;
WAIVER OF JURY TRIAL. BORROWER HEREBY IRREVOCABLY CONSENTS TO
THE NONEXCLUSIVE JURISDICTION OF THE CIRCUIT COURT OF JEFFERSON
COUNTY AND THE UNITED STATES DISTRICT COURT FOR THE WESTERN
DISTRICT OF KENTUCKY, AND WAIVES PERSONAL SERVICE OF ANY AND ALL
PROCESS UPON IT AND CONSENTS THAT ALL SUCH SERVICE OF PROCESS BE
MADE BY CERTIFIED OR REGISTERED MAIL DIRECTED TO BORROWER AT THE
ADDRESSES PROVIDED FOR IN SECTION 11.06 AND SERVICE SO MADE SHALL
BE DEEMED TO BE COMPLETED UPON ACTUAL RECEIPT THEREOF. BORROWER
WAIVES ANY OBJECTION TO JURISDICTION AND VENUE OF ANY ACTION
INSTITUTED AGAINST IT AS PROVIDED HEREIN AND AGREES NOT TO ASSERT
ANY DEFENSE BASED ON LACK OF JURISDICTION OR VENUE OR BASED ON
INCONVENIENT FORUM. BORROWER, THE AGENT AND THE BANKS HEREBY
WAIVE TRIAL BY JURY IN ANY ACTION, SUIT, PROCEEDING OR
COUNTERCLAIM OF ANY KIND ARISING OUT OF OR RELATED TO THIS
AGREEMENT OR ANY OTHER LOAN DOCUMENT TO THE FULL EXTENT PERMITTED
BY LAW.
11.17 Tax Withholding Clause.
Each Bank or assignee or participant of a Bank that is not
incorporated under the Laws of the United States of America or a
state thereof agrees that it will deliver to each of the Borrower
and the Agent two (2) duly completed copies of the following:
(i) Internal Revenue Service Form W-9, 4224 or 1001, or other
applicable form prescribed by the Internal Revenue Service,
certifying that such Bank, assignee or participant is entitled to
receive payments under this Agreement and the other Loan
Documents without deduction or withholding of any United States
federal income taxes, or is subject to such tax at a reduced rate
under an applicable tax treaty, or (ii) Internal Revenue Service
Form W-8 or other applicable form or a certificate of such Bank,
assignee or participant indicating that no such exemption or
reduced rate is allowable with respect to such payments. Each
Bank, assignee or participant required to deliver to the Borrower
and the Agent a form or certificate pursuant to the preceding
sentence shall deliver such form or certificate as follows:
(A) each Bank which is a party hereto on the Closing Date shall
deliver such form or certificate at least five (5) Business Days
prior to the first date on which any interest or fees are payable
by the Borrower hereunder for the account of each Bank; (B) each
assignee or participant shall deliver such form or certificate at
least five (5) Business Days before the effective date of such
assignment or participation (unless the Agent in its sole
discretion shall permit such assignee or participant to deliver
such form or certificate less than five (5) Business Days before
such date in which case it shall be due on the date specified by
the Agent). Each Bank, assignee or participant which so delivers
a Form W-8, W-9, 4224 or 1001 further undertakes to deliver to
each of the Borrower and the Agent two (2) additional copies of
such form (or a successor form) on or before the date that such
form expires or becomes obsolete or after the occurrence of any
event requiring a change in the most recent form so delivered by
it, and such amendments thereto or extensions or renewals thereof
as may be reasonably requested by the Borrower or the Agent,
either certifying that such Bank, assignee or participant is
entitled to receive payments under this Agreement and the other
Loan Documents without deduction or withholding of any United
States federal income taxes or is subject to such tax at a
reduced rate under an applicable tax treaty or stating that no
such exemption or reduced rate is allowable. The Agent shall be
entitled to withhold United States federal income taxes at the
full withholding rate unless the applicable Bank, assignee or
participant establishes an exemption or that it is subject to a
reduced rate as established pursuant to the above provisions.
The Borrower shall have no obligation to pay any additional
compensation to any Bank for any deduction or withholding for
United States federal income taxes which may be due and payable
in connection herewith.
11.18 Joinder of Guarantors.
Any Significant Subsidiary of the Borrower which is required to
join this Agreement as a Guarantor pursuant to Section 8.02(f)
shall execute and deliver to the Agent (i) with respect to the
first Significant Subsidiary to come into existence after the
Closing Date, the Guaranty Agreement, (ii) with respect to each
subsequently created Significant Subsidiary, a Guarantor Joinder
and (iii) documents in the forms described in Section 7.01
modified as appropriate to relate to such Significant Subsidiary.
The Borrower shall cause such Guaranty or Guarantor Joinder, as
the case may be, and related documents to be delivered to the
Agent within five (5) Business Days after the date such
Subsidiary becomes a Significant Subsidiary.
11.19 Co-Agent. The Co-Agent
shall have no duties, obligations, or liabilities in its capacity
as Co-Agent hereunder and shall not be entitled to any fees in
respect of its status as Co-Agent.
11.20 LIMITATION OF LIABILITY.
TO THE FULLEST EXTENT PERMITTED BY LAW, NO CLAIM MAY BE MADE BY
THE BORROWER OR ANY OTHER LOAN PARTY OR ANY OTHER PERSON AGAINST
THE AGENT AND THE BANKS, OR ANY OF THEM, OR ANY AFFILIATE,
DIRECTOR, OFFICER, EMPLOYEE, ATTORNEY OR AGENT OF THE AGENT OR
THE BANKS FOR ANY SPECIAL, INDIRECT, CONSEQUENTIAL OR PUNITIVE
DAMAGES IN RESPECT OF ANY CLAIM ARISING FROM OR RELATING TO THIS
AGREEMENT, ANY OTHER LOAN DOCUMENT OR ANY STATEMENT, COURSE OF
CONDUCT, ACT, OMISSION, OR EVENT OCCURRING IN CONNECTION HEREWITH
OR THEREWITH (WHETHER FOR BREACH OF CONTRACT, TORT OR ANY OTHER
THEORY OF LIABILITY); AND THE BORROWER HEREBY WAIVES, RELEASES
AND AGREES NOT TO SUE UPON ANY CLAIM FOR ANY SUCH DAMAGES,
WHETHER OR NOT ACCRUED AND WHETHER OR NOT KNOWN OR SUSPECTED TO
EXIST IN ITS FAVOR.
[SIGNATURE PAGE FOLLOWS]
IN WITNESS WHEREOF, the parties hereto, by their officers
thereunto duly authorized, have executed this Agreement as of the
day and year first above written.
ATTEST: LOUISVILLE GAS AND ELECTRIC COMPANY
By:
Title:
[Seal]
Address for Notices:
220 West Main Street
Louisville, KY 40202
Telecopier No. (502) 627-2203
Attention: Treasurer
Telephone No. (502) 627-2269
PNC BANK, KENTUCKY, INC.,
individually and as Agent
By:
Brennan T. Danile
Commercial Banking Representative
Address for Notices:
500 W. Jefferson Street, 2nd Floor
Louisville, KY 40202
Telecopier No. (502) 581-3355
Attention: Brennan T. Danile,
Commercial Banking Representative
Telephone No. (502) 581-3022
with a copy to:
______________________________
______________________________
Multi-Bank Loan Administration
One PNC Plaza, 19th Floor
Pittsburgh, PA 15265
Telecopier No. (412) 762-8672
Telephone No. (412) 762-3627
BANK OF MONTREAL
By:
Title:
Address for Notices:
Telecopier No.
Attention:
Telephone No.
CHASE MANHATTAN BANK, N.A.
By:
Title:
Address for Notices:
Telecopier No.
Attention:
Telephone No.
THE BANK OF NEW YORK
By:
Title:
Address for Notices:
Telecopier No.
Attention:
Telephone No.
CITIBANK, N.A.
By:
Title:
Address for Notices:
Telecopier No.
Attention:
Telephone No.
NATIONAL CITY BANK, KENTUCKY
By:
Title:
Address for Notices:
Telecopier No.
Attention:
Telephone No.
BANK OF LOUISVILLE
AND TRUST CO.
By:
Title:
Address for Notices:
Telecopier No.
Attention:
Telephone No.
BANK ONE,
KENTUCKY, N.A.
By:
Title:
Address for Notices:
Telecopier No.
Attention:
Telephone No.
FIFTH THIRD BANK OF
KENTUCKY, INC.
By:
Title:
Address for Notices:
Telecopier No.
Attention:
Telephone No.
<PAGE>
SCHEDULE 1.01(B)
COMMITMENTS
Ratable
Bank Commitment Share
PNC Bank, $30,000,000 18.75%
Kentucky, Inc.
Bank of Montreal $25,000,000 15.625%
Chase Manhattan Bank, N.A. $25,000,000 15.625%
The Bank of New York $20,000,000 12.5%
Citibank, N.A. $15,000,000 9.375%
National City Bank, KY $15,000,000 9.375%
Bank of Louisville and $10,000,000 6.25%
Trust Co.
Bank One, Kentucky, N.A. $10,000,000 6.25%
Fifth Third Bank
of Kentucky, Inc. $10,000,000 6.25%
_________ ______
Total $160,000,000 100.0%
