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EXHIBIT 99.4
U.S. $1,000,000,000
BRIDGE CREDIT AGREEMENT,
dated as of June 23, 2000,
among
CALPINE CORPORATION,
as the Borrower,
and
CERTAIN COMMERCIAL LENDING INSTITUTIONS,
as the Lenders,
and
CIBC WORLD MARKETS CORP.,
as Co-Arranger and Documentation Agent for the Lenders,
and
CREDIT SUISSE FIRST BOSTON,
as Lead Arranger and Syndication Agent for the Lenders,
and
THE BANK OF NOVA SCOTIA,
as Lead Arranger and Administrative Agent for the Lenders.
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TABLE OF CONTENTS
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ARTICLE I DEFINITIONS AND ACCOUNTING TERMS......................2
SECTION 1.1. Defined Terms.........................................2
SECTION 1.2. Use of Defined Terms.................................25
SECTION 1.3. Cross-References.....................................25
SECTION 1.4. Accounting and Financial Determinations..............25
ARTICLE II COMMITMENTS, BORROWING PROCEDURES AND NOTES..........26
SECTION 2.1. Commitments..........................................26
SECTION 2.1.1. Commitment.........................................26
SECTION 2.1.2. Lenders Not Permitted or Required To
Make Loans Under Certain Circumstances.............26
SECTION 2.2. Reduction of Commitment Amounts......................26
SECTION 2.3. Borrowing Procedure..................................27
SECTION 2.4. Continuation and Conversion Elections................27
SECTION 2.5. Funding..............................................28
SECTION 2.6. Notes................................................28
ARTICLE III REPAYMENTS, PREPAYMENTS, INTEREST AND FEES...........28
SECTION 3.1. Repayments and Prepayments...........................28
SECTION 3.2. Interest Provisions..................................30
SECTION 3.2.1. Rates..............................................30
SECTION 3.2.2. Post-Maturity Rates................................31
SECTION 3.2.3. Payment Dates......................................31
SECTION 3.3. Fees.................................................32
SECTION 3.3.1. Commitment Fee.....................................32
SECTION 3.3.2. Arrangers' and Agent's Fees........................32
ARTICLE IV [INTENTIONALLY OMITTED]..............................32
ARTICLE V CERTAIN LIBO RATE AND OTHER PROVISIONS...............33
SECTION 5.1. LIBO Rate Lending Unlawful...........................33
SECTION 5.2. Deposits Unavailable.................................33
SECTION 5.3. Increased LIBO Rate Loan Costs, etc..................34
SECTION 5.4. Funding Losses.......................................35
SECTION 5.5. Increased Capital Costs..............................35
SECTION 5.6. Taxes................................................36
SECTION 5.7. Payments, Computations, etc..........................37
SECTION 5.8. Sharing of Payments..................................38
SECTION 5.9. Use of Proceeds......................................39
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ARTICLE VI CONDITIONS PRECEDENT ................................39
SECTION 6.1. Initial Credit Extension.............................39
SECTION 6.1.1. Resolutions, etc...................................39
SECTION 6.1.2. Delivery of Notes..................................39
SECTION 6.1.3. Opinions of Counsel................................40
SECTION 6.1.4. Closing Fees, Expenses, etc........................40
SECTION 6.1.5. No Material Adverse Effect.........................40
SECTION 6.2. All Credit Extensions................................40
SECTION 6.2.1. Compliance with Warranties, No
Default, etc.......................................40
SECTION 6.2.2. Credit Request.....................................41
SECTION 6.2.3. Satisfactory Legal Form............................41
SECTION 6.2.4. Interest Coverage Ratio (Parent Only)..............41
SECTION 6.2.5. Senior Note Indentures.............................41
ARTICLE VII REPRESENTATIONS AND WARRANTIES.......................42
SECTION 7.1. Organization, etc....................................42
SECTION 7.2. Due Authorization, Non-Contravention, etc............42
SECTION 7.3. Government Approval, Regulation, etc.................43
SECTION 7.4. Validity, etc........................................43
SECTION 7.5. Financial Information................................43
SECTION 7.6. No Material Adverse Effect...........................44
SECTION 7.7. Litigation, Labor Controversies, etc.................44
SECTION 7.8. Subsidiaries.........................................44
SECTION 7.9. Ownership of Properties..............................44
SECTION 7.10. Taxes................................................44
SECTION 7.11. Pension and Welfare Plans............................45
SECTION 7.12. Environmental Warranties.............................45
SECTION 7.13. Regulations G, U and X...............................47
SECTION 7.14. Accuracy of Information..............................47
ARTICLE VIII COVENANTS............................................47
SECTION 8.1. Affirmative Covenants................................47
SECTION 8.1.1. Financial Information, Reports,
Notices, etc.......................................47
SECTION 8.1.2. Compliance with Laws, etc..........................50
SECTION 8.1.3. Maintenance of Properties..........................50
SECTION 8.1.4. Insurance..........................................50
SECTION 8.1.5. Books and Records..................................50
SECTION 8.1.6. Environmental Covenant.............................51
SECTION 8.1.7. Dividends of Subsidiaries..........................51
SECTION 8.2. Negative Covenants...................................51
SECTION 8.2.1. Business Activities................................52
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SECTION 8.2.2. Indebtedness.......................................52
SECTION 8.2.3. Liens..............................................54
SECTION 8.2.4. Financial Condition................................56
SECTION 8.2.5. Investments........................................57
SECTION 8.2.6. Restricted Payments, etc...........................58
SECTION 8.2.7. Capital Expenditures and Investments...............59
SECTION 8.2.8. Rental Obligations.................................59
SECTION 8.2.9. Consolidation, Merger, etc.........................60
SECTION 8.2.10. Asset Dispositions, etc............................60
SECTION 8.2.11. Modification of Certain Agreements.................61
SECTION 8.2.12. Transactions with Affiliates.......................61
SECTION 8.2.13. Negative Pledges, Restrictive
Agreements, etc....................................61
ARTICLE IX EVENTS OF DEFAULT....................................62
SECTION 9.1. Listing of Events of Default.........................62
SECTION 9.1.1. Non-Payment of Obligations.........................62
SECTION 9.1.2. Breach of Warranty.................................62
SECTION 9.1.3. Non-Performance of Certain Covenants
and Obligations....................................63
SECTION 9.1.4. Non-Performance of Other Covenants and
Obligations........................................63
SECTION 9.1.5. Default on Other Indebtedness......................63
SECTION 9.1.6. Judgments..........................................64
SECTION 9.1.7. Pension Plans......................................64
SECTION 9.1.8. Control of the Borrower............................64
SECTION 9.1.9. Bankruptcy, Insolvency, etc........................64
SECTION 9.1.10. Impairment of Security, etc........................65
SECTION 9.2. Action if Bankruptcy.................................65
SECTION 9.3. Action if Other Event of Default.....................66
ARTICLE X THE AGENT............................................66
SECTION 10.1. Actions..............................................66
SECTION 10.2. Funding Reliance, etc................................67
SECTION 10.3. Exculpation..........................................67
SECTION 10.4. Successor............................................68
SECTION 10.5. Loans by Scotiabank..................................68
SECTION 10.6. Credit Decisions.....................................69
SECTION 10.7. Copies, etc..........................................69
ARTICLE XI MISCELLANEOUS PROVISIONS.............................69
SECTION 11.1. Waivers, Amendments, etc.............................69
SECTION 11.2. Notices..............................................70
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SECTION 11.3. Payment of Costs and Expenses........................70
SECTION 11.4. Indemnification......................................71
SECTION 11.5. Survival.............................................72
SECTION 11.6. Severability.........................................73
SECTION 11.7. Headings.............................................73
SECTION 11.8. Execution in Counterparts, Effectiveness,
etc..................................................73
SECTION 11.9. Governing Law; Entire Agreement......................73
SECTION 11.10. Successors and Assigns...............................73
SECTION 11.11. Sale and Transfer of Loans and Notes;
Participations in Loans and Notes....................74
SECTION 11.11.1. Assignments........................................74
SECTION 11.11.2. Participations.....................................76
SECTION 11.12. Other Transactions...................................77
SECTION 11.13. Forum Selection and Consent to Jurisdiction..........77
SECTION 11.14. Waiver of Jury Trial.................................78
SECTION 11.15. Confidentiality......................................78
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SCHEDULE 1 - Disclosure Schedule
EXHIBIT A - Form of Note
EXHIBIT B - Form of Borrowing Request
EXHIBIT C - Form of Continuation/Conversion Notice
EXHIBIT D - Form of Lender Assignment Agreement
EXHIBIT E - Form of Opinion of Counsel to the Borrower
EXHIBIT F - Form of Opinion of Counsel to the Agent
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BRIDGE CREDIT AGREEMENT
THIS BRIDGE CREDIT AGREEMENT, dated as of June 23, 2000, among CALPINE
CORPORATION, a Delaware corporation (the "Borrower"), the various financial
institutions as are or may become parties hereto (collectively, the "Lenders"),
CIBC WORLD MARKETS CORP. ("CIBC"), as co-arranger and documentation agent,
CREDIT SUISSE FIRST BOSTON ("CSFB"), as lead arranger and syndication agent and
THE BANK OF NOVA SCOTIA ("Scotiabank"), as lead arranger and administrative
agent (Scotiabank, in such capacity, the "Agent") for the Lenders,
W I T N E S S E T H:
WHEREAS, the Borrower is engaged directly and through its various
Subsidiaries and Joint Ventures in the business of acquiring, developing, owning
and operating power generation facilities, purchasing, developing and selling
electricity and steam (including geothermal steam and fluids) and purchasing,
developing and selling natural gas and other fuels and related marketing
activities; and
WHEREAS, the Borrower desires to obtain Commitments from the Lenders
pursuant to which Loans will be made to the Borrower from time to time prior to
the Commitment Termination Date for such Commitments so long as the aggregate
principal amount of outstanding Loans at any one time does not exceed in the
aggregate $1,000,000,000;
WHEREAS, the Lenders are willing, on the terms and subject to the
conditions hereinafter set forth (including Article VI), to extend such
Commitments, make such Loans to the Borrower;
WHEREAS, the proceeds of such Loans will be used to purchase and/or
finance identified Acquisitions, or ownership interests in any Person owning any
asset included within the definition of Acquisition, and for general corporate
purposes of the Borrower and its Subsidiaries;
NOW, THEREFORE, the parties hereto agree as follows:
<PAGE> 8
ARTICLE I
DEFINITIONS AND ACCOUNTING TERMS
SECTION 1.1. Defined Terms. The following terms (whether or not
underscored) when used in this Agreement, including its preamble and recitals,
shall, except where the context otherwise requires, have the following meanings
(such meanings to be equally applicable to the singular and plural forms
thereof):
"Acquisition" means an acquisition by the Borrower or any of its
Subsidiaries of power projects, reserves of geothermal steam and fluids, natural
gas reserves, and other assets within the scope of its existing business.
"Additional Assets" means (i) any property or assets related to the
ownership, acquisition, development, construction, improvement and operation of
Facilities, including any related fuel reserves, which will be owned and used by
the Borrower or a Subsidiary; (ii) the capital stock of a Person that becomes a
Subsidiary as a result of the acquisition of such capital stock by the Borrower
or another Subsidiary or (iii) capital stock constituting a minority interest in
any Person that at such time is a Subsidiary.
"Affiliate" of any Person means any other Person which, directly or
indirectly, controls, is controlled by or is under common control with such
Person (excluding any trustee under, or any committee with responsibility for
administering, any Plan). A Person shall be deemed to be "controlled by" any
other Person if such other Person possesses, directly or indirectly, power
(a) to vote 10% or more of the securities (on a fully diluted
basis) having ordinary voting power for the election of directors or
managing general partners; or
(b) to direct or cause the direction of the management and
policies of such Person whether by contract or otherwise.
"Agent" is defined in the preamble and includes each other Person as
shall have subsequently been appointed as the successor Agent pursuant to
Section 10.4.
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"Agreement" means, on any date, this Bridge Credit Agreement as
originally in effect on the Effective Date and as thereafter from time to time
amended, supplemented, amended and restated, or otherwise modified and in effect
on such date.
"Alternate Base Rate" means, on any date and with respect to all Base
Rate Loans, a fluctuating rate of interest per annum equal to the higher of
(a) the rate of interest most recently established by Scotiabank
at its Domestic Office as its base rate; and
(b) the Federal Funds Rate most recently determined by Scotiabank
plus 1/2 of 1%.
The Alternate Base Rate is not necessarily intended to be the lowest rate of
interest determined by Scotiabank in connection with extensions of credit.
Changes in the rate of interest on that portion of any Loans maintained as Base
Rate Loans will take effect simultaneously with each change in the Alternate
Base Rate. The Agent will give notice promptly to the Borrower and the Lenders
of changes in the Alternate Base Rate.
"Applicable Margin" means, in the case of any Base Rate Loan, a rate per
annum of 0.75% and in the case of any LIBO Rate Loan, a rate per annum of 1.75%.
"Asset Sale" means any sale, transfer, lease or other disposition
described in Section 8.2.10(b).
"Assignee Lender" is defined in Section 11.11.1.
"Attributable Debt" means, with respect to a Sale/Leaseback Transaction,
the present value as of the date of determination (discounted at the weighted
average interest rate borne by the Senior Notes, compounded annually) of the
total obligations of the lessee for rental payments for the remaining term of
the lease included in such Sale/Leaseback Transaction (including any period for
which such lease has been extended).
"Authorized Officer" means, relative to any Obligor, the president, any
executive vice president, any senior vice
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president, the vice president - finance, the secretary, any assistant secretary
and the chief financial officer for whom a signature and incumbency certificate
has been delivered to the Agent and those other of its officers whose signatures
and incumbency shall have been certified to the Agent and the Lenders pursuant
to Section 6.1.1.
"Base Rate Loan" means a Loan bearing interest at a fluctuating rate
determined by reference to the Alternate Base Rate.
"Borrower" is defined in the preamble.
"Borrower EBITDA" means, for any period, the consolidated EBITDA of the
Borrower and its Subsidiaries, minus that portion of Consolidated Interest
Expense payable by the consolidating Subsidiaries, minus the principal payments
of the consolidating Subsidiaries, minus the consolidated non-discretionary
Capital Expenditures (i.e., Capital Expenditures which are expressly required to
be made under any agreement, contract, instrument, permit, license, law,
regulation, judgment or other arrangement (other than those arrangements and
contracts that relate to the performance of the work for which the Capital
Expenditure is being made) binding on the Borrower or any Subsidiary) of the
Borrower and its Subsidiaries, plus, without duplication, cash and Cash
Equivalent Investments of the Borrower's Wholly Owned Subsidiaries and Cogen
America that are legally and contractually available to each such Subsidiary for
the payment of dividends, but only to the extent the source of such cash and
Cash Equivalent Investments is from such Subsidiary's EBITDA or from repayments
to such Subsidiary of loans made by such Subsidiary.
"Borrower Interest Expense" means, for any period, as applied to the
Borrower, the sum of (a) the total interest expense of the Borrower for such
period as determined in accordance with GAAP, including, without limitation, all
interest paid by the Borrower under its subordinated debt securities issued to a
Trust, plus (b) all but the principal component of rentals in respect of
Capitalized Lease Liabilities paid, accrued, or scheduled to be paid or accrued
by the Borrower, plus (c) one-third of all operating lease obligations paid,
accrued and/or scheduled to be paid by the Borrower, plus (d) capitalized
interest plus (e) dividends paid in respect of preferred stock of
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the Borrower held by Persons other than the Borrower, plus (f) cash
contributions to any employee stock ownership plan to the extent such
contributions are used by such employee stock ownership plan to pay interest or
fees to any person (other than Borrower) in connection with loans incurred by
such employee stock ownership plan to purchase capital stock of the Borrower.
"Borrowing" means the Loans of the same type and, in the case of LIBO
Rate Loans, having the same Interest Period made by all Lenders on the same
Business Day and pursuant to the same Borrowing Request in accordance with
Section 2.1.
"Borrowing Request" means a loan request and certificate duly executed
by an Authorized Officer of the Borrower, substantially in the form of Exhibit
B.
"Business Day" means
(a) any day which is neither a Saturday or Sunday nor a legal
holiday on which banks are authorized or required to be closed in San
Francisco or New York; and
(b) relative to the making, continuing, prepaying or repaying of
any LIBO Rate Loans, any day on which dealings in Dollars are carried on
in the London interbank market.
"Capital Expenditures" means, for any period, the aggregate amount of
all expenditures of the Borrower and its Subsidiaries for fixed or capital
assets made during such period which, in accordance with GAAP, would be
classified as capital expenditures.
"Capitalized Lease Liabilities" means all rental obligations of the
Borrower or any of its Subsidiaries under any leasing or similar arrangement
which, in accordance with GAAP, would be classified as capitalized leases, and,
for purposes of this Agreement and each other Loan Document, the amount of such
obligations shall be the capitalized amount thereof, determined in accordance
with GAAP, and the stated maturity thereof shall be the date of the last payment
of rent or any other amount due under such lease prior to the first date upon
which such lease may be terminated by the lessee without payment of a penalty.
"Cash Equivalent Investment" means, at any time:
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(a) any evidence of Indebtedness, maturing not more than one year
after such time, issued or guaranteed by the United States Government or
an agency or instrumentality thereof;
(b) commercial paper, maturing not more than nine months from the
date of issue, which is issued by
(i) a corporation (excluding Affiliates of the Borrower)
organized under the laws of any state of the United States or of
the District of Columbia and rated at least A-l by S&P or P-l by
Moody's, or
(ii) any Lender (or its holding company or Affiliates);
(c) any certificate of deposit or bankers acceptance, maturing
not more than one year after such time, which is issued by either
(i) a commercial banking institution that is a member of the
Federal Reserve System and has a combined capital and surplus and
undivided profits of not less than $500,000,000, or
(ii) any Lender;
(d) money market mutual funds registered with the Securities and
Exchange Commission;
(e) corporate evidences of indebtedness rated A or better by S&P
or A2 or better by Moody's;
(f) any repurchase agreement entered into with any Lender (or
other commercial banking institution of the stature referred to in
clause (c)(i)) which
(i) is secured by a fully perfected security interest in any
obligation of the type described in any of clauses (a) through
(e); and
(ii) has a market value at the time such
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repurchase agreement is entered into of not less than 100% of the
repurchase obligation of such Lender (or other commercial banking
institution) thereunder; or
(g) any other investment approved by the Required Lenders.
"CERCLA" means the Comprehensive Environmental Response, Compensation
and Liability Act of 1980, as amended.
"CERCLIS" means the Comprehensive Environmental Response Compensation
Liability Information System List.
"Change in Control" means the acquisition by any Person, or two or more
Persons acting in concert, of beneficial ownership (within the meaning of Rule
13d-3 of the Securities and Exchange Commission under the Securities Exchange
Act of 1934) of 30% or more of the outstanding shares of voting stock of the
Borrower.
"Code" means the Internal Revenue Code of 1986, as amended, reformed or
otherwise modified from time to time.
"Cogen America" means Cogeneration Corporation of America, a Delaware
corporation of which the Borrower owns not less than 50% of the outstanding
voting stock.
"Commitment" means, relative to any Lender, such Lender's obligation to
make Loans pursuant to Section 2.1.1.
"Commitment Amount" means, on any date, $1,000,000,000, as such amount
may be reduced from time to time pursuant to Section 2.2.
"Commitment Availability" means, on any date, the excess of
(a) the then Commitment Amount,
over
(b) the sum of the outstanding principal amount of all Loans on
such date.
"Commitment Termination Date" means the earliest of
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(a) the six month anniversary of the Effective Date;
(b) the date on which the Commitment Amount is terminated in full
or reduced to zero pursuant to Section 2.2; and
(c) the date on which any Commitment Termination Event occurs.
Upon the occurrence of any event described in clause (b) or (c), the Commitments
shall terminate automatically and without any further action.
"Commitment Termination Event" means
(a) the occurrence of any Default described in clauses (a)
through (d) of Section 9.1.9 with respect to the Borrower or any
Significant Subsidiary; or
(b) the occurrence and continuance of any other Event of Default
and either
(i) the declaration of the Loans to be due and payable
pursuant to Section 9.3, or
(ii) in the absence of such declaration, the giving of notice
by the Agent, acting at the direction of the Required Lenders, to
the Borrower that the Commitments have been terminated.
"Consolidated Income Tax Expense" means, for any period, as applied to
the Borrower, the provision for local, state, federal or foreign income taxes on
a consolidated basis for such period determined in accordance with GAAP.
"Consolidated Interest Expense" means, for any period, as applied to the
Borrower, the sum of (a) the total interest expense of the Borrower and its
consolidated Subsidiaries for such period as determined in accordance with GAAP,
plus (b) all but the principal component of rentals in respect of Capitalized
Lease Liabilities paid, accrued, or scheduled to be paid or accrued by the
Borrower or its consolidated Subsidiaries, plus
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(c) one-third of all operating lease obligations paid, accrued, and/or scheduled
to be paid by the Borrower and its consolidated Subsidiaries, plus (d)
capitalized interest, plus (e) dividends paid in respect of preferred stock of
the Borrower or any Subsidiary held by Persons other than the Borrower or a
Wholly Owned Subsidiary, including, without limitation, but without duplication
of payments by the Borrower to a Trust, all payments by a Trust of dividends and
distributions with respect to the Guaranteed Preferred Securities, plus (f) cash
contributions to any employee stock ownership plan to the extent such
contributions are used by such employee stock ownership plan to pay interest or
fees to any Person (other than the Borrower or a Subsidiary) in connection with
loans incurred by such employee stock ownership plan to purchase capital stock
of the Borrower.
"Consolidated Net Income (Loss)" means, for any period, as applied to
the Borrower, the Consolidated Net Income (loss) of the Borrower and its
consolidated Subsidiaries for such period, determined in accordance with GAAP,
adjusted by excluding (without duplication), to the extent included in such net
income (loss), the following: (i) all extraordinary gains or losses; (ii) any
net income of any Person if such Person is not incorporated or organized in the
United States, a state thereof or the District of Columbia, except that (A) the
Borrower's equity in the net income of any such Person for such period shall be
included in Consolidated Net Income (Loss) up to the aggregate amount of cash
actually distributed by such Person during such period to the Borrower or a
Subsidiary incorporated or organized in the United States, a state thereof or
the District of Columbia, as a dividend or other distribution and (B) the equity
of the Borrower or a Subsidiary in a net loss of any such Person for such period
shall be included in determining Consolidated Net Income (Loss); (iii) the net
income of any Subsidiary to the extent that the declaration or payment of
dividends or similar distributions by such Subsidiary of such income is not at
the time thereof permitted, directly or indirectly, by operation of the terms of
its charter or by-laws or any agreement, instrument, judgment, decree, order,
statute, rule or governmental regulation applicable to such Subsidiary or its
stockholders; (iv) any net income (or loss) of any Person combined with the
Borrower or any of its Subsidiaries on a "pooling of interests" basis
attributable to any period prior to the date of such combination; (v) any gain
(but not loss) realized upon the sale or other
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disposition of any property, plant or equipment of the Borrower or its
Subsidiaries (including pursuant to any sale-and-leaseback arrangement) which is
not sold or otherwise disposed of in the ordinary course of business and any
gain (but not loss) realized upon the sale or other disposition by the Borrower
or any Subsidiary of any capital stock of any Person, provided that losses shall
be included on an after-tax basis; and (vi) the cumulative effect of a change in
accounting principles; and further adjusted by subtracting from such net income
the tax liability of any parent of the Borrower to the extent of payments made
to such parent by the Borrower pursuant to any tax sharing agreement or other
arrangement for such period.
"Contingent Liability" means any agreement, undertaking or arrangement
by which any Person guarantees, endorses or otherwise becomes or is contingently
liable upon (by direct or indirect agreement, contingent or otherwise, to
provide funds for payment, to supply funds to, or otherwise to invest in, a
debtor, or otherwise to assure a creditor against loss) the indebtedness,
obligation or any other liability of any other Person (other than by
endorsements of instruments in the course of collection), or guarantees the
payment of dividends or other distributions upon the shares of any other Person.
The amount of any Person's obligation under any Contingent Liability shall be
calculated on a net basis (i.e., after taking into effect agreements,
undertakings and other arrangements between the Person whose obligations are
being guaranteed and the counterparty to such Person's obligations) and shall
(subject to any limitation set forth therein) be deemed to be the outstanding
net principal amount (or maximum net principal amount, if larger) of the debt,
obligation or other liability guaranteed thereby, or, if the principal amount is
not stated or determinable, the maximum reasonably anticipated net liability in
respect thereof as determined by the Person in good faith, provided that (y) the
amount of any Contingent Liability arising out of any indebtedness, obligation
or liability other than the items described in clauses (a), (b) and (c) of the
definition of "Indebtedness" and (z) the amount of any Contingent Liability
consisting of a "keep-well", "make well" or other similar arrangement shall be
deemed to be zero unless and until the Borrower is required to make any payment
with respect thereto (and shall thereafter be deemed to be the amount required
to be paid).
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"Continuation/Conversion Notice" means a notice of continuation or
conversion and certificate duly executed by an Authorized Officer of the
Borrower, substantially in the form of Exhibit C.
"Controlled Group" means all members of a controlled group of
corporations and all members of a controlled group of trades or businesses
(whether or not incorporated) under common control which, together with the
Borrower, are treated as a single employer under Section 414(b) or 414(c) of the
Code or Section 4001 of ERISA.
"Credit Extension" means and includes the advancing of any Loans by the
Lenders in connection with a Borrowing.
"Debt" means the outstanding principal amount of all Indebtedness of the
Borrower and its consolidated Subsidiaries of the nature referred to in clauses
(a), (b), (c) and (f) of the definition of "Indebtedness," and (without
duplication) all Contingent Liabilities in respect of any of the foregoing.
"Default" means any Event of Default or any condition, occurrence or
event which, after notice or lapse of time or both, would constitute an Event of
Default.
"Disclosure Schedule" means the Disclosure Schedule attached hereto as
Schedule 1, as it may be amended, supplemented or otherwise modified from time
to time by the Borrower with the written consent of the Agent and the Required
Lenders.
"Dollar" and the sign "$" mean lawful money of the United States.
"Domestic Office" means, relative to any Lender, the office of such
Lender designated as such below its signature hereto or designated in the Lender
Assignment Agreement or such other office of a Lender (or any successor or
assign of such Lender) within the United States as may be designated from time
to time by notice from such Lender, as the case may be, to each other Person
party hereto. A Lender may have separate Domestic Offices for purposes of
making, maintaining or continuing Base Rate Loans.
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"EBITDA" means, for any period, as applied to the Borrower, the sum of
Consolidated Net Income (Loss) (but without giving effect to adjustments,
accruals, deductions or entries resulting from purchase accounting,
extraordinary losses or gains and any gains or losses from any Asset Sales),
plus the following to the extent included in calculating Consolidated Net Income
(Loss): (a) Consolidated Income Tax Expense, (b) Consolidated Interest Expense,
(c) depreciation expense, (d) amortization expense and (e) all other non-cash
items reducing Consolidated Net Income, less all non-cash items increasing
Consolidated Net Income, in each case for such period; provided that, if the
Borrower has any Subsidiary that is not a Wholly Owned Subsidiary, EBITDA shall
be reduced (to the extent not otherwise reduced by GAAP) by an amount equal to
(A) the consolidated net income (loss) of such Subsidiary (to the extent
included in Consolidated Net Income (Loss)) multiplied by (B) the quotient of
(1) the number of shares of outstanding common stock of such Subsidiary not
owned on the last day of such period by the Borrower or any Wholly Owned
Subsidiary of the Borrower divided by (2) the total number of shares of
outstanding common stock of such Subsidiary on the last day of such period.
"8 3/4% Senior Notes" means the $275,000,000 of 8 3/4% Senior Notes due
2007 issued by the Borrower pursuant to the 8 3/4% Senior Note Indenture.
"8 3/4% Senior Note Indenture" means that certain Indenture dated as of
July 8, 1997 between the Borrower and The Bank of New York, Trustee.
"Effective Date" means the date on or before June 30, 2000, specified in
a written notice from the Agent on which this Agreement becomes effective
pursuant to Section 11.8.
"Environmental Laws" means all applicable federal, state or local
statutes, laws, ordinances, codes, rules, regulations and guidelines (including
consent decrees and administrative orders) relating to public health and safety
and protection of the environment.
"ERISA" means the Employee Retirement Income Security Act of 1974, as
amended, and any successor statute of similar import,
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together with the regulations thereunder, in each case as in effect from time to
time. References to sections of ERISA also refer to any successor sections.
"Event of Default" is defined in Section 9.1.
"Facility" means a power generation facility or energy producing
facility and all related assets and facilities, including any related fuel
reserves.
"Federal Funds Rate" means, for any period, a fluctuating interest rate
per annum equal for each day during such period to
(a) the weighted average of the rates on overnight federal funds
transactions with members of the Federal Reserve System arranged by
federal funds brokers, as published for such day (or, if such day is not
a Business Day, for the next preceding Business Day) by the Federal
Reserve Bank of New York; or
(b) if such rate is not so published for any day which is a
Business Day, the average of the quotations for such day on such
transactions received by Scotiabank from three federal funds brokers of
recognized standing selected by it.
"Fiscal Quarter" means any period of three consecutive months ending on
March 31, June 30, September 30 or December 31 of any year.
"Fiscal Year" means any period of twelve consecutive calendar months
ending on December 31; references to a Fiscal Year with a number corresponding
to any calendar year (e.g. the "1995 Fiscal Year") refer to the Fiscal Year
ending on the December 31 occurring during such calendar year.
"$400,000,000 Credit Agreement" means that certain U.S. $400,000,000
Second Amended and Restated Credit Agreement dated as of May 23, 2000 among,
inter alia, the Borrower and Scotiabank, as administrative agent.
"F.R.S. Board" means the Board of Governors of the Federal Reserve
System or any successor thereto.
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"GAAP" is defined in Section 1.4.
"Guaranteed Preferred Securities" means the preferred securities issued
by one of the Trusts, from time to time, including, without limitation the
$276,000,000 of principal amount of such securities issued in October, 1999, the
$300,000,000 of principal amount of such securities issued in January, 2000 and
the $60,000,000 of principal amount of such securities issued in February, 2000.
"Hazardous Material" means
(a) any "hazardous substance", as defined by CERCLA;
(b) any "hazardous waste", as defined by the Resource
Conservation and Recovery Act, as amended;
(c) any petroleum product; or
(d) any pollutant or contaminant or hazardous, dangerous or toxic
chemical, material or substance within the meaning of any other
applicable federal, state or local law, regulation, ordinance or
requirement (including consent decrees and administrative orders)
relating to or imposing liability or standards of conduct concerning any
hazardous, toxic or dangerous waste, substance or material, all as
amended or hereafter amended.
"Hedging Obligations" means, with respect to any Person, the net
liabilities of such Person under (a) interest rate swap agreements, interest
rate cap agreements and interest rate collar agreements, foreign exchange
contracts, currency swap agreements and all other agreements or arrangements
designed to protect such Person against fluctuations in interest rates or
currency exchange rates and (b) commodity or power swap or exchange agreements.
"herein", "hereof", "hereto", "hereunder" and similar terms contained in
this Agreement or any other Loan Document refer to this Agreement or such other
Loan Document, as the case may be, as a whole and not to any particular Section,
paragraph or provision of this Agreement or such other Loan Document.
"Impermissible Qualification" means, relative to the opinion
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or certification of any independent public accountant as to any financial
statement of any Obligor, any qualification or exception to such opinion or
certification
(a) which is of a "going concern" or similar nature;
(b) which relates to the limited scope of examination of matters
relevant to such financial statement; or
(c) which relates to the treatment or classification of any item
in such financial statement and which, as a condition to its removal,
would require an adjustment to such item the effect of which would be to
cause such Obligor to be in default of any of its obligations under
Section 8.2.4.
"including" means including without limiting the generality of any
description preceding such term, and, for purposes of this Agreement and each
other Loan Document, the parties hereto agree that the rule of ejusdem generis
shall not be applicable to limit a general statement, which is followed by or
referable to an enumeration of specific matters, to matters similar to the
matters specifically mentioned.
"Indebtedness" of any Person means, without duplication:
(a) all obligations of such Person for borrowed money and all
obligations of such Person evidenced by bonds, debentures, notes or
other similar instruments (excluding the Borrower's subordinated debt
securities issued to a Trust and the Guaranteed Preferred Securities or
any similar securities);
(b) all obligations, contingent or otherwise, relative to the
stated amount of all letters of credit, whether or not drawn, and
banker's acceptances issued for the account of such Person; provided,
however, that if a letter of credit or banker's acceptance has been
issued to support or secure any other form of Indebtedness, only the
greater of the stated amount of such letter of credit or banker's
acceptance or the outstanding principal amount of Indebtedness supported
or secured, but not both, will be considered Indebtedness hereunder;
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(c) all obligations of such Person as lessee under leases which
have been or should be, in accordance with GAAP, recorded as Capitalized
Lease Liabilities;
(d) all other items other than deferred taxes, deferred revenue
and deferred leases which, in accordance with GAAP, would be included as
liabilities on the liability side of the balance sheet of such Person as
of the date at which Indebtedness is to be determined;
(e) net liabilities of such Person under all Hedging Obligations;
(f) whether or not so included as liabilities in accordance with
GAAP, all net obligations of such Person to pay the deferred purchase
price of property or services (excluding accounts payable incurred in
the ordinary course of business), and indebtedness (excluding prepaid
interest thereon) secured by a Lien on property owned or being purchased
by such Person (including indebtedness arising under conditional sales
or other title retention agreements), whether or not such indebtedness
shall have been assumed by such Person or is limited in recourse, but
excluding any royalties or similar payments to be made by such Person
which are based on production or performance; and
(g) all Contingent Liabilities of such Person in respect of any
of the foregoing.
For all purposes of this Agreement, the Indebtedness of any Person shall include
the Indebtedness of any partnership or joint venture in which such Person is a
general partner or a joint venturer, unless the indebtedness of such partnership
or joint venture is expressly nonrecourse to such Person.
"Indemnified Liabilities" is defined in Section 11.4.
"Indemnified Parties" is defined in Section 11.4.
"Interest Coverage Ratio" means, for any period of four Fiscal Quarters,
the ratio of (x) the consolidated EBITDA of the
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Borrower and its Subsidiaries during such period to (y) the Consolidated
Interest Expense of the Borrower and its Subsidiaries (excluding from
Consolidated Interest Expense for purposes of this clause (y) interest
capitalized in connection with the construction of a new Facility which interest
is capitalized during the construction of such Facility) incurred during such
period. This ratio shall be calculated after giving pro forma effect to any
Acquisition based upon the historical audited financial statements of the
project that was the subject of the Acquisition. It is agreed that for purposes
of clause (f) of Section 8.2.2 only, the Interest Coverage Ratio shall be
calculated in conformity in all respects with the calculation of "Consolidated
Coverage Ratio" under the Senior Note Indentures.
"Interest Coverage Ratio (Parent Only)" means, for any period of four
Fiscal Quarters, the ratio of (x) the Borrower EBITDA during such period to (y)
the Borrower Interest Expense (excluding from Borrower Interest Expense for
purposes of this clause (y) interest capitalized in connection with the
construction of a new Facility which interest is capitalized during the
construction of such Facility) during such period; provided, however, that if
the Interest Coverage Ratio (Parent Only) as so calculated falls below 1.70 to
1.00, then for purposes of Section 6.2.4, the Interest Coverage Ratio (Parent
Only) shall be calculated as of the end of any calendar month on a rolling
twelve month basis until the Interest Coverage Ratio (Parent Only) equals or
exceeds 1.70 to 1.00, at which time such ratio shall again be tested quarterly.
This ratio shall be calculated after giving pro forma effect to any Acquisition.
"Interest Period" means, relative to any LIBO Rate Loans, the period
beginning on (and including) the date on which such LIBO Rate Loan is made or
continued as, or converted into, a LIBO Rate Loan pursuant to Section 2.3 or 2.4
and ending on (but excluding) the day which numerically corresponds to such date
one, three or six months thereafter (or, if such month has no numerically
corresponding day, on the last Business Day of such month), in each case as the
Borrower may select in its relevant notice pursuant to Section 2.3 or 2.4;
provided, however, that
(a) the Borrower shall not be permitted to select Interest
Periods to be in effect at any one time which have expiration dates
occurring on more than ten different dates;
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(b) Interest Periods commencing on the same date for Loans
comprising part of the same Borrowing shall be of the same duration;
(c) if such Interest Period would otherwise end on a day which is
not a Business Day, such Interest Period shall end on the next following
Business Day (unless, if such Interest Period applies to LIBO Rate
Loans, such next following Business Day is the first Business Day of a
calendar month, in which case such Interest Period shall end on the
Business Day next preceding such numerically corresponding day); and
(d) no Interest Period may end later than the date set forth in
clause (a) of the definition of "Commitment Termination Date".
"Investment" means, relative to any Person, without duplication,
(a) any loan or advance made by such Person to any other Person
(excluding commission, travel and similar advances to officers and
employees made in the ordinary course of business and prepaid expenses);
(b) any Contingent Liability of such Person; and
(c) any ownership or similar interest held by such Person in any
other Person.
The amount of any Investment shall be the original principal or capital amount
thereof less all returns of principal or equity thereon (and without adjustment
by reason of the financial condition of such other Person) and shall, if made by
the transfer or exchange of property other than cash, be deemed to have been
made in an original principal or capital amount equal to the fair market value
of such property.
"Investment Joint Venture" means, with respect to any Person, any
corporation, partnership or other Person of which 25% or more of the outstanding
capital stock or other comparable ownership interest having ordinary voting
power to elect not less than 25% of the board of directors of such corporation
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(irrespective or whether at the time capital stock of any other class or classes
of such corporation shall or might have voting power upon the occurrence of any
contingency) is at the time directly or indirectly owned by such Person, by such
Person and one or more other Subsidiaries of such Person, or by one or more
other Subsidiaries of such Person.
"Joint Venture" means, with respect to any Person, any corporation,
partnership or other Person of which 50% of the outstanding capital stock or
other comparable ownership interest having ordinary voting power to elect not
less than 50% of the board of directors of such corporation (irrespective or
whether at the time capital stock of any other class or classes of such
corporation shall or might have voting power upon the occurrence of any
contingency) is at the time directly or indirectly owned by such Person, by such
Person and one or more other Subsidiaries of such Person, or by one or more
other Subsidiaries of such Person.
"knowledge" or "to the Borrower's knowledge" means the knowledge of or
to the knowledge of the president, any vice president, the general counsel, the
secretary, the chief financial officer, the controller or the vice
president-finance of the Borrower.
"Lender Assignment Agreement" means a Lender Assignment Agreement
substantially in the form of Exhibit D.
"Lenders" is defined in the preamble.
"Leverage Ratio" means the ratio of (a) Debt to (b) Debt plus Tangible
Net Worth.
"LIBO Rate" is defined in Section 3.2.1.
"LIBO Rate Loan" means a Loan bearing interest, at all times during an
Interest Period applicable to such Loan, at a fixed rate of interest determined
by reference to the LIBO Rate (Reserve Adjusted).
"LIBO Rate (Reserve Adjusted)" is defined in Section 3.2.1.
"LIBOR Office" means, relative to any Lender, the office of
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such Lender designated as such below its signature hereto or designated in the
Lender Assignment Agreement or such other office of a Lender (or any successor
or assign of such Lender) as designated from time to time by notice from such
Lender to the Borrower and the Agent, whether or not outside the United States,
which shall be making or maintaining LIBO Rate Loans of such Lender hereunder.
"LIBOR Reserve Percentage" is defined in Section 3.2.1.
"Lien" means any security interest, mortgage, pledge, hypothecation,
assignment for security, deposit arrangement, encumbrance, lien (statutory or
otherwise), charge against or interest in property to secure payment of a debt
or performance of an obligation or other priority or preferential arrangement of
any kind or nature whatsoever.
"Loan" is defined in Section 2.1.1.
"Loan Document" means this Agreement, the Notes and each other relevant
agreement, document or instrument (including the fee letter described in Section
3.3.2) delivered in connection therewith.
"Material Adverse Effect" means (a) a material adverse change in, or a
material adverse effect upon, the financial condition, operations or assets
(including any power projects) of the Borrower and its Significant Subsidiaries
taken as a whole; or (b) a material adverse change in the ability of the
Borrower or any other Obligor to perform under any Loan Document.
"Monthly Payment Date" means the last day of each calendar month or, if
any such day is not a Business Day, the next succeeding Business Day.
"Moody's" is defined in the definition of the term "Borrower's Credit
Rating".
"Net Available Cash" means, with respect to any Asset Sale, the cash or
cash equivalent payments received by the Borrower or a Subsidiary in connection
with such Asset Sale (including any cash received by way of deferred payment of
principal pursuant to a note or installment receivable or otherwise, but only as
or
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when received and also including the proceeds of other property received when
converted to cash or cash equivalents) net of the sum of, without duplication,
(i) all reasonable legal, title and recording tax expenses, reasonable
commissions, and other reasonable fees and expenses incurred directly relating
to such Asset Sale, (ii) all local, state, federal and foreign taxes required to
be paid or accrued as a liability by the Borrower or any of its Subsidiaries as
a consequence of such Asset Sale, (iii) payments made to repay Indebtedness
which is secured by any assets subject to such Asset Sale in accordance with the
terms of any Lien upon or other security agreement of any kind with respect to
such assets, or which must by its terms, or by applicable law, be repaid out of
the proceeds from such Asset Sale and (iv) all distributions required by any
contract entered into other than in contemplation of such Asset Sale to be paid
to any holder of a minority equity interest in such Subsidiary as a result of
such Asset Sale, so long as such distributions do not exceed such minority
holder's pro rata portion (based on such minority holder's proportionate equity
interest) of the cash or cash equivalent payments described above, net of the
amounts set forth in clauses (i)-(iii) above.
"Net Equity Proceeds" means, with respect to any issuance by the
Borrower or a Trust of any equity securities (including the Guaranteed Preferred
Securities), the gross consideration received by or for the account of the
issuer minus underwriting and brokerage commissions, discounts and fees relating
to such issuance that are payable by the issuer.
"9 1/4% Senior Notes" means the $105,000,000 of 9 1/4% Senior Notes due
2004 issued by the Borrower pursuant to the 9 1/4% Senior Note Indenture.
"9 1/4% Senior Note Indenture" means that certain Indenture dated as of
February 17, 1994 between the Borrower and Shawmut Bank Connecticut, National
Association, Trustee.
"Nonmaterial Subsidiary Default" means any Default arising or resulting
from the default or potential default by a Subsidiary under any obligation or
condition under Section 8.1 of this Agreement or under any other agreement,
contract or undertaking binding on such Subsidiary other than (i) the failure by
such Subsidiary to make a required payment under any
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Indebtedness of such Subsidiary having a principal amount in excess of
$10,000,000 and (ii) a default in the performance or observance of any
obligation or condition with respect to any Indebtedness of such Subsidiary
having a principal amount in excess of $10,000,000 and, as a result thereof, the
holder or holders of such Indebtedness, or any trustee or agent for such
holders, causes such Indebtedness to be repaid more quickly than theretofore
scheduled, whether through the introduction of a "cash sweep," the increase of
an existing "cash sweep" or otherwise.
"Note" means a promissory note of the Borrower payable to the order of
any Lender, in the form of Exhibit A (as such promissory note may be amended,
endorsed or otherwise modified from time to time), evidencing the aggregate
Indebtedness of the Borrower to such Lender resulting from outstanding Loans,
and also means all other promissory notes accepted from time to time in
substitution therefor or renewal thereof.
"Obligations" means all obligations (monetary or otherwise) of the
Borrower and each other Obligor arising under or in connection with this
Agreement, the Notes and each other Loan Document.
"Obligor" means the Borrower or any other Person (other than the Agent
or any Lender) obligated under, or otherwise a party to, any Loan Document.
"Organic Document" means, relative to any Obligor, its certificate of
incorporation, partnership agreement, or similar organizational document, its
by-laws and all shareholder agreements, voting trusts and similar arrangements
applicable to any of its authorized shares of capital stock or other ownership
interests.
"Participant" is defined in Section 11.11.
"PBGC" means the Pension Benefit Guaranty Corporation and any entity
succeeding to any or all of its functions under ERISA.
"Pension Plan" means a "pension plan", as such term is defined in
section 3(2) of ERISA, which is subject to Title IV of ERISA (other than a
multiemployer plan as defined in section
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4001(a)(3) of ERISA), and to which the Borrower or any corporation, trade or
business that is, along with the Borrower, a member of a Controlled Group, may
have liability, including any liability by reason of having been a substantial
employer within the meaning of section 4063 of ERISA at any time during the
preceding five years, or by reason of being deemed to be a contributing sponsor
under section 4069 of ERISA.
"Percentage" means, relative to any Lender, the percentage set forth
opposite its signature hereto or set forth in the Lender Assignment Agreement,
as such percentage may be adjusted from time to time pursuant to Lender
Assignment Agreement(s) executed by such Lender and its Assignee Lender(s) and
delivered pursuant to Section 11.11.
"Person" means any natural person, corporation, partnership, limited
liability company, firm, association, trust, government, governmental agency or
any other entity, whether acting in an individual, fiduciary or other capacity.
"Plan" means any Pension Plan or Welfare Plan.
"pro forma" or "pro forma basis" means, for any period, that if the
Borrower or any Subsidiary shall have made any acquisition or disposition of
assets or capital stock (occurring by merger or otherwise) since the beginning
of such period (including any acquisition or disposition of assets or capital
stock occurring in connection with a transaction causing a calculation to be
made hereunder), subject to the qualifications set forth in the definitions
thereof, the Interest Coverage Ratio and Interest Coverage Ratio (Parent Only)
calculated for such period shall be calculated after giving pro forma effect to
such acquisition or disposition, based upon the historical audited financial
statements covering the assets or stock so acquired or disposed.
"Quarterly Payment Date" means the last day of each March, June,
September, and December or, if any such day is not a Business Day, the next
succeeding Business Day.
"Release" means a "release", as such term is defined in CERCLA.
"Required Lenders" means, at any time, Lenders having
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Percentages aggregating at least 51%.
"Resource Conservation and Recovery Act" means the Resource Conservation
and Recovery Act, 42 U.S.C. Section 6901, et seq., as in effect from time to
time.
"Sale/Leaseback Transaction" means an arrangement relating to property
now owned or hereafter acquired whereby the Borrower or a Subsidiary transfers
such property to a Person and leases it back from such Person, other than leases
for a term of not more than 36 months or between the Borrower and a Wholly Owned
Subsidiary or between Wholly Owned Subsidiaries. "Sale/Leaseback Transactions"
shall not include any arrangements or transactions constituting Capitalized
Lease Liabilities.
"S&P" is defined in the definition of the term "Borrower's Credit
Rating".
"Scotiabank" is defined in the preamble.
"Senior Note Indentures" means, collectively, the 7 3/4% Senior Note
Indenture, the 7 5/8% Senior Note Indenture, the 7 7/8% Senior Note Indenture,
the 8 3/4% Senior Note Indenture, the 9 1/4% Senior Note Indenture and the 10
1/2% Senior Note Indenture.
"Senior Notes" means, collectively, the 7 3/4% Senior Notes, the 75/8%
Senior Notes, the 7 7/8% Senior Notes, the 8 3/4% Senior Notes, the 9 1/4%
Senior Notes and the 10 1/2% Senior Notes.
"7 5/8 Senior Notes" means the $250,000,000 of 7 5/8% Senior Notes due
2006 issued by the Borrower pursuant to the 7 5/8% Senior Note Indenture.
"7 5/8 Senior Note Indenture" means the certain Indenture dated as of
March 29, 1999 between the Borrower and The Bank of New York, Trustee.
"7 7/8% Senior Notes" means the $400,000,000 of 7 7/8% Senior Notes due
2008 issued by the Borrower pursuant to the 7 7/8% Senior Note Indenture.
"7 7/8% Senior Note Indenture" means that certain Indenture dated as of
March 31, 1998 between the Borrower and The Bank of
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New York, Trustee.
"7 3/4 Senior Notes" means the $350,000,000 of 7 3/4% Senior Notes due
2009 issued by the Borrower pursuant to the 7 3/4% Senior Note Indenture.
"7 3/4 Senior Note Indenture" means that certain Indenture dated as of
March 29, 1999 between the Borrower and The Bank of New York, Trustee.
"Significant Subsidiary" means each Subsidiary of the Borrower that
(a) accounted for at least 10% of consolidated revenues of the
Borrower and its Subsidiaries or 10% of consolidated earnings of the
Borrower and its Subsidiaries before interest and taxes, in each case
for the last four full Fiscal Quarters immediately preceding the date as
of which any such determination is made; or
(b) has assets which represent at least 10% of the consolidated
assets of the Borrower and its Subsidiaries as of the last day of the
last Fiscal Quarter of the Borrower immediately preceding the date as of
which any such determination is made,
all of which shall be as reflected on the financial statements of the Borrower
for the period, or as of the date, in question.
"Special Purpose Subsidiary" is defined in Section 8.2.2(e).
"Subordinated Debt" means all unsecured Indebtedness of the Borrower for
money borrowed which is subordinated, upon terms satisfactory to the Agent and
the Required Lenders, in right of payment to the payment in full in cash of all
Obligations.
"Subsidiary" means, with respect to any Person, any corporation,
partnership or other Person of which more than 50% of the outstanding capital
stock or other comparable ownership interest having ordinary voting power to
elect a majority of the board of directors of such corporation (irrespective of
whether at the time capital stock of any other class or classes of such
corporation shall or might have voting power upon the occurrence of any
contingency) is at the time directly or indirectly owned
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by such Person, by such Person and one or more other Subsidiaries of such
Person, or by one or more other Subsidiaries of such Person.
"Tangible Net Worth" means the consolidated net worth of the Borrower
and its Subsidiaries, including the aggregate outstanding face amount of the
Guaranteed Preferred Securities, after subtracting therefrom the aggregate
amount of any intangible assets of the Borrower and its Subsidiaries, including
goodwill, franchises, licenses, patents, trademarks, trade names, copyrights,
service marks and brand names.
"Taxes" is defined in Section 5.6.
"10 1/2% Senior Note Indenture" means that certain Indenture dated as of
May 16, 1996 between Borrower and Fleet National Bank, as Trustee.
"10 1/2% Senior Notes" means the $180,000,000, ten year notes issued by
the Borrower on May 16, 1996 pursuant to the 10 1/2% Senior Note Indenture.
"Trust" means Calpine Capital Trust and Calpine Capital Trust I, each a
Delaware business trust.
"type" means, relative to any Loan, the portion thereof, if any, being
maintained as a Base Rate Loan or a LIBO Rate Loan.
"United States" or "U.S." means the United States of America, its fifty
States and the District of Columbia.
"Welfare Plan" means a "welfare plan", as such term is defined in
section 3(1) of ERISA.
"Wholly Owned Subsidiary" means a Subsidiary all the capital stock of
which (other than directors' qualifying shares) is owned by the Borrower or
another Wholly Owned Subsidiary.
SECTION 1.2. Use of Defined Terms. Unless otherwise defined or the
context otherwise requires, terms for which meanings are provided in this
Agreement shall have such meanings when used in the Disclosure Schedule and in
each Note, Borrowing Request, Continuation/Conversion Notice, Loan Document,
notice
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and other communication delivered from time to time in connection with this
Agreement or any other Loan Document.
SECTION 1.3. Cross-References. Unless otherwise specified, references in
this Agreement and in each other Loan Document to any Article or Section are
references to such Article or Section of this Agreement or such other Loan
Document, as the case may be, and, unless otherwise specified, references in any
Article, Section or definition to any clause are references to such clause of
such Article, Section or definition.
SECTION 1.4. Accounting and Financial Determinations. Unless otherwise
specified, all accounting terms used herein or in any other Loan Document shall
be interpreted, all accounting determinations and computations hereunder or
thereunder (including under Section 8.2.4) shall be made, and all financial
statements required to be delivered hereunder or thereunder shall be prepared in
accordance with, generally accepted accounting principles ("GAAP") in effect
from time to time.
ARTICLE II
COMMITMENTS, BORROWING PROCEDURES AND NOTES
SECTION 2.1. Commitments. On the terms and subject to the conditions of
this Agreement (including Article V), each Lender severally agrees as follows:
SECTION 2.1.1. Commitment. From time to time on any Business Day
occurring prior to the Commitment Termination Date, each Lender severally will
make Loans (relative to such Lender, its "Loans") to the Borrower equal to such
Lender's Percentage of the aggregate amount of the Borrowing of Loans requested
by the Borrower to be made on such day. On the terms and subject to the
conditions hereof, the Borrower may from time to time borrow and prepay Loans.
No amounts paid or prepaid with respect to any Loans may be reborrowed.
SECTION 2.1.2. Lenders Not Permitted or Required To Make Loans Under
Certain Circumstances. No Lender shall be permitted or required to make any Loan
if, after giving effect thereto, the aggregate outstanding principal amount of
all Loans
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(i) of all Lenders made since the Effective Date would exceed
the Commitment Amount, or
(ii) of such Lender made since the Effective Date would
exceed such Lender's Percentage of the Commitment Amount.
SECTION 2.2. Reduction of Commitment Amounts. The Borrower may, from
time to time on any Business Day occurring after the time of the initial
Borrowing hereunder, voluntarily reduce the Commitment Amount; provided,
however, that all such reductions shall require at least three Business Days'
prior notice to the Agent and be permanent reductions of the Commitment Amount,
and any partial reduction of any Commitment Amount shall be in a minimum amount
of $2,000,000 and in an integral multiple of $500,000.
SECTION 2.3. Borrowing Procedure. By delivering a Borrowing Request to
the Agent on or before 10:00 a.m., San Francisco time, on a Business Day, the
Borrower may from time to time irrevocably request, on not less than three days,
in the case of LIBO Rate Loans, or one day in the case of Base Rate Loans, nor
more than five Business Days' notice, that a Borrowing be made in a minimum
amount of $2,000,000 or in the unused amount of the Commitment. The Agent shall
promptly transmit the information in the Borrower's request to each Lender. On
the terms and subject to the conditions of this Agreement, each Borrowing shall
be comprised of the type of Loans, and shall be made on the Business Day,
specified in such Borrowing Request. On or before 11:00 a.m. (San Francisco
time) on the Business Day specified in such Borrowing Request each Lender shall
deposit with the Agent same day funds in an amount equal to such Lender's
Percentage of the requested Borrowing. Such deposit will be made to an account
which the Agent shall specify from time to time by notice to the Lenders. To the
extent funds are received from the Lenders, the Agent shall make such funds
available to the Borrower by wire transfer to the accounts the Borrower shall
have specified in its Borrowing Request. No Lender's obligation to make any Loan
shall be affected by any other Lender's failure to make any Loan.
SECTION 2.4. Continuation and Conversion Elections. By
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delivering a Continuation/Conversion Notice to the Agent on or before 10:00
a.m., San Francisco time, on a Business Day, the Borrower may from time to time
irrevocably elect, on not less than three nor more than five Business Days'
notice that all, or any portion in an aggregate minimum amount of $2,000,000 of
any Loans be, in the case of Base Rate Loans, converted into LIBO Rate Loans or,
in the case of LIBO Rate Loans, be converted into a Base Rate Loan or continued
as a LIBO Rate Loan (in the absence of delivery of a Continuation/ Conversion
Notice with respect to any LIBO Rate Loan at least three Business Days before
the last day of the then current Interest Period with respect thereto, such LIBO
Rate Loan shall, on such last day, automatically convert to a Base Rate Loan);
provided, however, that (i) each such conversion or continuation shall be pro
rated among the applicable outstanding Loans of all Lenders, and (ii) no portion
of the outstanding principal amount of any Loans may be continued as, or be
converted into, LIBO Rate Loans when any Default has occurred and is continuing.
The Agent shall promptly transmit the information in each
Continuation/Conversion Notice to each Lender.
SECTION 2.5. Funding. Each Lender may, if it so elects, fulfill its
obligation to make, continue or convert LIBO Rate Loans hereunder by causing one
of its foreign branches or Affiliates (or an international banking facility
created by such Lender) to make or maintain such LIBO Rate Loan; provided,
however, that such LIBO Rate Loan shall nonetheless be deemed to have been made
and to be held by such Lender, and the obligation of the Borrower to repay such
LIBO Rate Loan shall nevertheless be to such Lender for the account of such
foreign branch, Affiliate or international banking facility; provided, further,
that each Lender shall use reasonable efforts in making any such election to
minimize the costs payable by the Borrower hereunder with respect to any Loan or
Commitment. In addition, the Borrower hereby consents and agrees that, for
purposes of any determination to be made for purposes of Section 5.1, 5.2, 5.3
or 5.4, it shall be conclusively assumed that each Lender elected to fund all
LIBO Rate Loans by purchasing Dollar deposits in its LIBOR Office's interbank
eurodollar market.
SECTION 2.6. Notes. Each Lender's Loans under a Commitment shall be
evidenced by a Note payable to the order of such Lender in a maximum principal
amount equal to such Lender's Percentage
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of the original Commitment Amount. The Borrower hereby irrevocably authorizes
each Lender to make (or cause to be made) appropriate notations on the grid
attached to such Lender's Notes (or on any continuation of such grid), which
notations, if made, shall evidence, inter alia, the date of, the outstanding
principal of, and the interest rate and Interest Period applicable to the Loans
evidenced thereby. Such notations shall be conclusive and binding on the
Borrower absent manifest error; provided, however, that the failure of any
Lender to make any such notations shall not limit or otherwise affect any
Obligations of the Borrower or any other Obligor.
ARTICLE III
REPAYMENTS, PREPAYMENTS, INTEREST AND FEES
SECTION 3.1. Repayments and Prepayments. The Borrower shall repay in
full the unpaid principal amount of each Loan upon the Commitment Termination
Date. Prior thereto, the Borrower
(a) may, from time to time on any Business Day, make a voluntary
prepayment, in whole or in part, of the outstanding principal amount of
any Loans; provided, however, that
(i) any such prepayment shall be made pro rata among Loans of
the same type and, if applicable, having the same Interest
Period, of all Lenders;
(ii) no such prepayment of any LIBO Rate Loan may be made on
any day other than the last day of the Interest Period for such
Loan, unless the Borrower also pays all losses and expenses (for
which the Borrower has received written notice, including
calculations in reasonable detail) as a result of such prepayment
as provided in Section 5.4;
(iii) all such voluntary prepayments shall require at least
three but no more than five Business Days' prior written notice
to the Agent; and
(iv) all such voluntary partial prepayments shall be in an
aggregate minimum amount of $2,000,000; and
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(b) shall, on each date when any reduction in the Commitment
Amount shall become effective, make a mandatory prepayment (which shall
be applied (or held for application, as the case may be) by the Lenders
to the payment of the aggregate unpaid principal amount of those Loans
then outstanding in an amount equal to the excess, if any, of the
aggregate, outstanding principal amount of all Loans over the Commitment
Amount as so reduced; and
(c) shall, if the Borrower, the Trusts of any of its or their
Subsidiaries raises capital through the issuance of any type of equity
or issues any subordinated unsecured debt or senior unsecured debt
(including any trust preferred securities or other convertible
instrument) otherwise permitted by this Agreement, make a mandatory
prepayment of all Loans in an amount equal to the Net Equity Proceeds
(in the case of any issuance of equity) or the proceeds of such
issuance, net of usual and customary fees and expenses (in the case of
any issuance of debt); and
(d) shall, immediately upon any acceleration of the Commitment
Termination Date of any Loans pursuant to Section 9.2 or Section 9.3,
repay all Loans, unless, pursuant to Section 9.3, only a portion of all
Loans is so accelerated.
Each prepayment of any Loans made pursuant to this Section shall be without
premium or penalty, except as may be required by Section 5.4. Each mandatory or
voluntary prepayment of principal of any Loans shall cause a reduction in the
Commitment Amount.
SECTION 3.2. Interest Provisions. Interest on the outstanding principal
amount of Loans shall accrue and be payable in accordance with this Section 3.2.
SECTION 3.2.1. Rates. Pursuant to an appropriately delivered Borrowing
Request or Continuation/Conversion Notice, the Borrower may elect that Loans
comprising a Borrowing accrue interest at a rate per annum:
(a) on that portion maintained from time to time as a Base Rate
Loan, equal to the sum of the Alternate Base Rate from time to time in
effect plus the Applicable Margin; and
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(b) on that portion maintained as a LIBO Rate Loan, during each
Interest Period applicable thereto, equal to the sum of the LIBO Rate
(Reserve Adjusted) for such Interest Period plus the Applicable Margin.
The "LIBO Rate (Reserve Adjusted)" means, relative to any Loan to be
made, continued or maintained as, or converted into, a LIBO Rate Loan for any
Interest Period, a rate per annum (rounded upwards, if necessary, to the nearest
1/16 of 1%) determined pursuant to the following formula:
LIBO Rate = LIBO Rate
-------------------------------
(Reserve Adjusted) 1.00 - LIBOR Reserve Percentage
The LIBO Rate (Reserve Adjusted) for any Interest Period for LIBO Rate Loans
will be determined by the Agent on the basis of the LIBOR Reserve Percentage in
effect on, and the applicable rates furnished to and received by the Agent from
Scotiabank, two Business Days before the first day of such Interest Period.
"LIBO Rate" means, relative to any Interest Period for LIBO Rate Loans,
the rate of interest equal to the average (rounded upwards, if necessary, to the
nearest 1/16 of 1%) of the rates per annum at which Dollar deposits in
immediately available funds are offered to Scotiabank's LIBOR Office in the
London interbank market as at or about 11:00 a.m. London time two Business Days
prior to the beginning of such Interest Period for delivery on the first day of
such Interest Period, and in an amount approximately equal to the amount of
Scotiabank's LIBO Rate Loan and for a period approximately equal to such
Interest Period.
"LIBOR Reserve Percentage" means, for each day of any Interest Period
for LIBO Rate Loans, the reserve percentage (expressed as a decimal) equal to
the maximum aggregate reserve requirements (including all basic, emergency,
supplemental, marginal and other reserves and taking into account any
transitional adjustments or other scheduled changes in reserve requirements)
specified from time to time under regulations issued from time to time by the
F.R.S. Board and then applicable to assets or liabilities consisting of and
including "Eurocurrency Liabilities", as currently defined in Regulation D of
the F.R.S. Board.
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All LIBO Rate Loans shall bear interest from and including the first day
of the applicable Interest Period to (but not including) the last day of such
Interest Period at the interest rate determined as applicable to such LIBO Rate
Loan.
SECTION 3.2.2. Post-Maturity Rates. After the date any principal amount
of any Loan is due and payable (whether on the Commitment Termination Date, upon
acceleration or otherwise), or after any other monetary Obligation of the
Borrower shall have become due and payable, the Borrower shall pay, but only to
the extent permitted by law, interest (after as well as before judgment) on such
amounts at a rate per annum equal to the Alternate Base Rate plus the Applicable
Margin plus a margin of 2%.
SECTION 3.2.3. Payment Dates. Interest accrued on each Loan shall be
payable, without duplication:
(a) on the Commitment Termination Date;
(b) on the date of any optional or required payment or
prepayment, in whole or in part, of principal outstanding on such Loan
being prepaid;
(c) with respect to Base Rate Loans, on each Quarterly Payment
Date occurring after the Effective Date;
(d) with respect to LIBO Rate Loans, on the last day of each
applicable Interest Period (and, if such Interest Period shall exceed
three months, at the end of the third month of such Interest Period);
(e) with respect to any Base Rate Loans converted into LIBO Rate
Loans on a day when interest would not otherwise have been payable
pursuant to clause (c), on the date of such conversion; and
(f) on that portion of any Loans the Commitment Termination Date
of which is accelerated pursuant to Section 9.2 or Section 9.3,
immediately upon such acceleration.
Interest accrued on Loans or other monetary Obligations arising under this
Agreement or any other Loan Document after the date
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such amount is due and payable (whether on the Commitment Termination Date, upon
acceleration or otherwise) shall be payable upon demand.
SECTION 3.3. Fees. The Borrower agrees to pay the fees set forth in this
Section 3.3. All such fees shall be non-refundable.
SECTION 3.3.1. Commitment Fee. The Borrower agrees to pay to the Agent
for the account of each Lender, for the period (including any portion thereof
when any of its Commitments are suspended by reason of the Borrower's inability
to satisfy any condition of Article VI) commencing on the Effective Date and
continuing through the final Commitment Termination Date, a commitment fee at a
rate of 0.50% per annum times each such Lender's Percentage of the average daily
unused portion of the Commitment Amount. Such commitment fees shall be payable
by the Borrower in arrears on each Quarterly Payment Date, commencing with the
first such day following the Effective Date, and on each Commitment Termination
Date.
SECTION 3.3.2. Arrangers' and Agent's Fees. The Borrower agrees to pay
to Scotiabank, CSFB and CIBC for their own account the up-front fees described
in the fee letter among the Borrower, Scotiabank, CSFB and CIBC dated June 23,
2000, at the time required in such letter.
ARTICLE IV
[INTENTIONALLY OMITTED]
ARTICLE V
CERTAIN LIBO RATE AND OTHER PROVISIONS
SECTION 5.1. LIBO Rate Lending Unlawful. If any Lender shall determine
in good faith (which good faith determination shall, upon notice thereof to the
Borrower and the Lenders, be conclusive and binding on the Borrower) that the
introduction of or any change in or in the interpretation of any law makes it
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unlawful, or any central bank or other governmental authority asserts that it is
unlawful, for such Lender to make, continue or maintain any Loan as, or to
convert any Loan into, a LIBO Rate Loan, the obligations of all Lenders to make,
continue, maintain or convert into any such Loans shall, upon such
determination, forthwith be suspended until such Lender shall notify the Agent
that the circumstances causing such suspension no longer exist, and all LIBO
Rate Loans of such type shall automatically convert into Base Rate Loans at the
end of the then current Interest Periods with respect thereto or sooner, if
required by such law or assertion. Until such time as such Lender's obligation
to make, continue and maintain LIBO Rate Loans is reinstated, the Borrower shall
have the right (with the prior written consent of the Agent, which consent shall
not be unreasonably withheld) to replace such affected Lender by obtaining
another financial institution that is willing to purchase such affected Lender's
interest herein for the full amount of any outstanding Loans and other amounts
owed hereunder (including principal, accrued interest, breakage costs and any
other unreimbursed costs and expenses owed to such Lender), to assume such
affected Lender's obligations under this Agreement and to become a Lender
hereunder. In such event, the affected Lender shall, upon ten (10) Business Days
notice from Borrower, assign one hundred percent (100%) of its interest
hereunder to such replacement lender for the price described in the previous
sentence.
SECTION 5.2. Deposits Unavailable. If the Agent shall have determined
that
(a) Dollar deposits in the relevant amount and for the relevant
Interest Period are not available to Scotiabank or any Lender in its
relevant market; or
(b) by reason of circumstances affecting Scotiabank's or any
Lender's relevant market, adequate means do not exist for ascertaining
the interest rate applicable hereunder to LIBO Rate Loans,
then, upon notice from the Agent to the Borrower and the Lenders, the
obligations of all Lenders under Section 2.3 and Section 2.4 to make or continue
any Loans as, or to convert any Loans into, LIBO Rate Loans shall forthwith be
suspended (at the end of the applicable Interest Period, in the case of
outstanding LIBO Rate
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Loans) until the Agent shall notify the Borrower and the Lenders that the
circumstances causing such suspension no longer exist.
SECTION 5.3. Increased LIBO Rate Loan Costs, etc. The Borrower agrees to
reimburse each Lender for any increase in the cost to such Lender of, or any
reduction in the amount of any sum receivable by such Lender in respect of,
making, continuing or maintaining (or of its obligation to make, continue or
maintain) any Loans as, or of converting (or of its obligation to convert) any
Loans into, LIBO Rate Loans as a result in any change after the Effective Date,
in applicable law, regulation, rule, decree or regulatory requirement or in the
interpretation or application by any judicial or regulatory authority of any
law, regulation, rule, decree or regulatory requirement. Such Lender shall
promptly notify the Agent and the Borrower in writing of the occurrence of any
such event, such notice to state, in reasonable detail, the reasons therefor and
the additional amount required fully to compensate such Lender for such
increased cost or reduced amount. Such additional amounts shall be payable by
the Borrower directly to such Lender within five Business Days of its receipt of
such notice, and such notice shall, in the absence of manifest error and if
given in good faith, be conclusive and binding on the Borrower. If such
increased costs do not affect all of the Lenders, the Borrower shall have the
right (with the prior written consent of the Agent, which consent shall not be
unreasonably withheld) to replace the affected Lender by obtaining another
financial institution that is willing to purchase such affected Lender's
interest herein for the full amount of any outstanding Loans (principal and
accrued interest), to assume such affected Lender's obligations under this
Agreement and to become a Lender hereunder. In such event, the affected Lender
shall, upon five (5) Business Days notice from Borrower, assign one hundred
percent (100%) of its interests hereunder to such replacement lender for the
price described in the previous sentence and thereafter such Lender shall have
no further obligations hereunder.
SECTION 5.4. Funding Losses. In the event any Lender shall incur any
loss or expense (including any loss or expense incurred by reason of the
liquidation or reemployment of deposits or other funds acquired by such Lender
to make, continue or maintain any portion of the principal amount of any Loan
as, or to convert any portion of the principal amount of any Loan into, a LIBO
Rate
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Loan) as a result of
(a) any conversion or repayment or prepayment of the principal
amount of any LIBO Rate Loans on a date other than the scheduled last
day of the Interest Period applicable thereto;
(b) any Loans not being made as LIBO Rate Loans in accordance
with the Borrowing Request therefor other than as a result of any act or
omission by such Lender;
(c) any Loans not being continued as, or converted into, LIBO
Rate Loans in accordance with the Continuation/ Conversion Notice
therefor other than as a result of any act or omission by such Lender;
or
(d) any LIBO Rate Loan not being prepaid in accordance with a
notice of prepayment,
then, upon the written notice of such Lender to the Borrower (with a copy to the
Agent), the Borrower shall, within five Business Days of its receipt thereof,
pay directly to such Lender such amount as will (in the reasonable determination
of such Lender) reimburse such Lender for such loss or expense. Such written
notice (which shall include calculations in reasonable detail and all
information and documentation reasonably necessary to support such calculations)
shall, in the absence of manifest error, be conclusive and binding on the
Borrower.
SECTION 5.5. Increased Capital Costs. If any change in, or the
introduction, adoption, effectiveness, interpretation, reinterpretation or
phase-in of, any law or regulation, directive, guideline, decision or request
(whether or not having the force of law) of any court, central bank, regulator
or other governmental authority causes the amount of capital required or
expected to be maintained by any Lender or any Person controlling such Lender
attributable to or based upon the Loans or Commitments hereunder to be
increased, and such Lender determines (in its reasonable discretion) that the
rate of return on its or such controlling Person's capital as a consequence of
its Commitments or the Loans made by such Lender is reduced to a level below
that which such Lender or such controlling Person could have achieved but for
the occurrence of any such
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circumstance, then, in any such case upon notice from time to time by such
Lender to the Borrower, the Borrower shall immediately pay directly to such
Lender additional amounts sufficient to compensate such Lender or such
controlling Person for such reduction in rate of return. A statement of such
Lender as to any such additional amount or amounts (including calculations
thereof in reasonable detail) shall, in the absence of manifest error and if
made in good faith, be conclusive and binding on the Borrower. In determining
such amount, such Lender may use any method of averaging and attribution that it
(in its good faith discretion) shall deem applicable.
SECTION 5.6. Taxes. All payments by the Borrower of principal of, and
interest on, the Loans and all other amounts payable hereunder shall be made
free and clear of and without deduction for any present or future income,
excise, stamp or franchise taxes and other taxes, fees, duties, withholdings or
other charges of any nature whatsoever imposed by any taxing authority, but
excluding franchise taxes and taxes imposed on or measured by any Lender's net
income or receipts (such non-excluded items being called "Taxes"). In the event
that any withholding or deduction from any payment to be made by the Borrower
hereunder is required in respect of any Taxes pursuant to any applicable law,
rule or regulation, then the Borrower will
(a) pay directly to the relevant authority the full amount
required to be so withheld or deducted;
(b) promptly forward to the Agent an official receipt or other
documentation satisfactory to the Agent evidencing such payment to such
authority; and
(c) pay to the Agent for the account of the Lenders such
additional amount or amounts as is necessary to ensure that the net
amount actually received by each Lender will equal the full amount such
Lender would have received had no such withholding or deduction been
required.
Moreover, if any Taxes are directly asserted against the Agent or any Lender
with respect to any payment received by the Agent or such Lender hereunder, the
Agent or such Lender may pay such Taxes and the Borrower will promptly pay such
additional amounts (including any penalties, interest or expenses) as is
necessary
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in order that the net amount received by such person after the payment of such
Taxes (including any Taxes on such additional amount) shall equal the amount
such person would have received had not such Taxes been asserted.
If the Borrower fails to pay any Taxes when due to the appropriate
taxing authority or fails to remit to the Agent, for the account of the
respective Lenders, the required receipts or other required documentary
evidence, the Borrower shall indemnify the Lenders for any incremental Taxes,
interest or penalties that may become payable by any Lender as a result of any
such failure. For purposes of this Section 5.6, a distribution hereunder by the
Agent or any Lender to or for the account of any Lender shall be deemed a
payment by the Borrower.
Upon the request of the Borrower or the Agent, each Lender (including
any assignee of a Lender) that is organized under the laws of a jurisdiction
other than the United States shall, prior to the due date of and as a condition
to any payments under the Notes, execute and deliver to the Borrower and the
Agent, on or about the first scheduled payment date in each Fiscal Year, one or
more (as the Borrower or the Agent may reasonably request) United States
Internal Revenue Service Forms W-8EC1 or Forms W-8BEN or such other forms or
documents (or successor forms or documents), appropriately completed, as may be
applicable to establish the extent, if any, to which a payment to such Lender is
exempt from withholding or deduction of Taxes.
SECTION 5.7. Payments, Computations, etc. Unless otherwise expressly
provided, all payments by the Borrower pursuant to this Agreement, the Notes or
any other Loan Document shall be made by the Borrower to the Agent for the pro
rata account of the Lenders entitled to receive such payment. All such payments
required to be made to the Agent shall be made, without setoff, deduction or
counterclaim, not later than 11:00 a.m., San Francisco time, on the date due, in
same day or immediately available funds, to such account as the Agent shall
specify from time to time by notice to the Borrower. Funds received after that
time shall be deemed to have been received by the Agent on the next succeeding
Business Day. The Agent shall promptly remit in same day funds to each Lender
its share, if any, of such payments received by the Agent for the account of
such Lender. All interest and fees shall be computed on the basis of the actual
number of days (including the
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first day but excluding the last day) occurring during the period for which such
interest or fee is payable over a year comprised of 360 days (or, in the case of
interest on a Base Rate Loan (other than when calculated with respect to the
Federal Funds Rate), 365 days or, if appropriate, 366 days). Whenever any
payment to be made shall otherwise be due on a day which is not a Business Day,
such payment shall (except as otherwise required by clause (c) of the definition
of the term "Interest Period" with respect to LIBO Rate Loans) be made on the
next succeeding Business Day and such extension of time shall be included in
computing interest and fees, if any, in connection with such payment.
SECTION 5.8. Sharing of Payments. If any Lender shall obtain any payment
or other recovery (whether voluntary, involuntary, by application of setoff or
otherwise) on account of any Loan (other than pursuant to the terms of Sections
5.3, 5.4 and 5.5) in excess of its pro rata share of payments then or therewith
obtained by all Lenders, such Lender shall purchase from the other Lenders such
participations in Loans made by them as shall be necessary to cause such
purchasing Lender to share the excess payment or other recovery ratably with
each of them; provided, however, that if all or any portion of the excess
payment or other recovery is thereafter recovered from such purchasing Lender,
the purchase shall be rescinded and each Lender which has sold a participation
to the purchasing Lender shall repay to the purchasing Lender the purchase price
to the ratable extent of such recovery together with an amount equal to such
selling Lender's ratable share (according to the proportion of
(a) the amount of such selling Lender's required repayment to the
purchasing Lender
to
(b) the total amount so recovered from the purchasing Lender)
of any interest or other amount paid or payable by the purchasing Lender in
respect of the total amount so recovered. The Borrower agrees that any Lender so
purchasing a participation from another Lender pursuant to this Section may, to
the fullest extent
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permitted by law, exercise all its rights of payment (including pursuant to
Section 5.9) with respect to such participation as fully as if such Lender were
the direct creditor of the Borrower in the amount of such participation. If
under any applicable bankruptcy, insolvency or other similar law, any Lender
receives a secured claim in lieu of a setoff to which this Section applies, such
Lender shall, to the extent practicable, exercise its rights in respect of such
secured claim in a manner consistent with the rights of the Lenders entitled
under this Section to share in the benefits of any recovery on such secured
claim.
SECTION 5.9. Use of Proceeds. The Borrower shall apply the proceeds of
each Borrowing in accordance with the fourth recital; without limiting the
foregoing, no proceeds of any Loan will be used to acquire any equity security
of a class which is registered pursuant to Section 12 of the Securities Exchange
Act of 1934 or any "margin stock", as defined in F.R.S. Board Regulation U.
ARTICLE VI
CONDITIONS PRECEDENT
SECTION 6.1. Initial Credit Extension. The effectiveness of this
Agreement shall be subject to the prior or concurrent satisfaction of each of
the conditions precedent set forth in this Section 6.1.
SECTION 6.1.1. Resolutions, etc. The Agent shall have received from each
Obligor a certificate, dated the date of the initial Borrowing, of its Secretary
or Assistant Secretary, as to
(a) resolutions of its Board of Directors then in full force and
effect authorizing the execution, delivery and performance of this
Agreement, the Notes and each other Loan Document to be executed by it;
and
(b) the incumbency and signatures of those of its officers
authorized to act with respect to this Agreement, the Notes and each
other Loan Document executed by it,
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upon which certificate each Lender may conclusively rely until it shall have
received a further certificate of the Secretary of such Obligor canceling or
amending such prior certificate.
SECTION 6.1.2. Delivery of Notes. The Agent shall have received, for the
account of each Lender, its Notes duly executed and delivered by the Borrower.
SECTION 6.1.3. Opinions of Counsel. The Agent shall have received
opinions, dated the date of the Effective Date and addressed to the Agent and
all Lenders, from
(a) Lisa Bodensteiner, Esq., general counsel of the Borrower, and
Thelen Reid & Priest, substantially in the form of Exhibits E-1 and E-2.
(b) Mayer, Brown & Platt, counsel to the Agent, substantially in
the form of Exhibit F.
SECTION 6.1.4. Closing Fees, Expenses, etc. The Agent shall have
received for its own account, or for the account of each Lender, as the case may
be, all fees, costs and expenses due and payable pursuant to Sections 3.3 and
11.3, if then invoiced.
SECTION 6.1.5. No Material Adverse Effect. No Material Adverse Effect
shall have occurred since December 31, 1999.
SECTION 6.2. All Credit Extensions. The obligation of each Lender to
make any Credit Extension (including the initial Credit Extension) shall be
subject to the satisfaction of each of the conditions precedent set forth in
this Section 6.2.
SECTION 6.2.1. Compliance with Warranties, No Default, etc. Both before
and after giving effect to any Credit Extension (but, if any Default of the
nature referred to in Section 9.1.5 shall have occurred with respect to any
other Indebtedness, without giving effect to the application, directly or
indirectly, of the proceeds of any Borrowing) the following statements shall be
true and correct
(a) the representations and warranties set forth in Article VII
(excluding, however, those contained in Section 7.7) and in each other Loan
Document shall be true and correct in all
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material respects with the same effect as if then made (unless stated to relate
solely to an early date, in which case such representations and warranties shall
be true and correct as of such earlier date);
(b) except as disclosed by the Borrower to the Agent and the Lenders
pursuant to Section 7.7
(i) no labor controversy, litigation, arbitration or governmental
investigation or proceeding shall be pending or, to the knowledge of the
Borrower, threatened against the Borrower or any of its Significant
Subsidiaries which would reasonably be expected to cause a Material
Adverse Effect or which purports to materially and adversely affect the
legality, validity or enforceability of this Agreement, the Notes or any
other Loan Document; and
(ii) no development shall have occurred in any labor controversy,
litigation, arbitration or governmental investigation or proceeding
disclosed pursuant to Section 7.7 which might have a Material Adverse
Effect; and
(c) no Default (other than a Nonmaterial Subsidiary Default) shall have
then occurred and be continuing, and neither the Borrower, any other Obligor,
nor any of its Significant Subsidiaries are in material violation of any law or
governmental regulation or court order or decree which would reasonably be
expected to cause a Material Adverse Effect.
SECTION 6.2.2. Credit Request. The Agent shall have received a Borrowing
Request for such Credit Extension. Each of the delivery of a Borrowing Request
and the acceptance by the Borrower of the proceeds of the Borrowing shall
constitute a representation and warranty by the Borrower that on the date of
such Borrowing (both immediately before and after giving effect to such
Borrowing and the application of the proceeds thereof) the statements made in
Section 6.2.1 are true and correct.
SECTION 6.2.3. Satisfactory Legal Form. All documents executed or
submitted pursuant hereto by or on behalf of the Borrower or any of its
Subsidiaries or any other Obligors shall be satisfactory in form and substance
to the Agent and its counsel; the Agent and its counsel shall have received all
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information, approvals, opinions, documents or instruments as the Agent or its
counsel may reasonably request.
SECTION 6.2.4. Interest Coverage Ratio (Parent Only). The Interest
Coverage Ratio (Parent Only), calculated as of the end of the most recently
ended Fiscal Quarter or, if the Interest Coverage Ratio (Parent Only) had
previously fallen below 1.70 to 1.00 and had not subsequently returned to 1.70
to 1.00 or better, calculated as of the end of the most recently ended calendar
month, shall be at least 1.70 to 1.00 for the previous 12 months.
SECTION 6.2.5. Senior Note Indentures. The Borrower shall have certified
to the Agent that its incurrence of the Indebtedness under such Borrowing is
permitted under the terms of Section 3.4 of the Senior Note Indentures. To the
extent that the Borrower is relying on clause (a) of Section 3.4 of the Senior
Note Indentures, the Borrower shall have delivered to the Agent a certificate
demonstrating its compliance with the incurrence test set forth therein.
ARTICLE VII
REPRESENTATIONS AND WARRANTIES
In order to induce the Lenders and the Agent to enter into this
Agreement and to make Loans hereunder, the Borrower represents and warrants unto
the Agent and each Lender as set forth in this Article VII.
SECTION 7.1. Organization, etc. The Borrower and each of its Significant
Subsidiaries is a corporation, partnership, limited liability company or similar
entity validly organized and existing and in good standing under the laws of the
State of its organization, is duly qualified to do business and is in good
standing as a foreign organization in each jurisdiction where the nature of its
business requires such qualification and where the failure to so qualify would
have a material adverse effect on the Borrower's or any Obligor's ability to
perform its obligations under the Loan Documents to which it is a party, and has
full power and authority and holds all requisite governmental licenses, permits
and other approvals to enter into and perform its Obligations under this
Agreement, the Notes and each other
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Loan Document to which it is a party and to own or hold under lease its property
and to conduct its business substantially as currently conducted by it.
SECTION 7.2. Due Authorization, Non-Contravention, etc. The execution,
delivery and performance by the Borrower of this Agreement, the Notes and each
other Loan Document executed or to be executed by it, and the execution,
delivery and performance by each other Obligor of each Loan Document executed or
to be executed by it are within the Borrower's and each such Obligor's corporate
powers, have been duly authorized by all necessary corporate action, and do not
(a) contravene the Borrower's or any such Obligor's Organic
Documents;
(b) contravene any contractual restriction (including, without
limitation, the Senior Note Indentures), law or governmental regulation
or court decree or order binding on or affecting the Borrower or any
such Obligor; or
(c) result in, or require the creation or imposition of, any Lien
on any of the Borrower's or any other Obligor's properties.
SECTION 7.3. Government Approval, Regulation, etc. No authorization or
approval or other action by, and no notice to or filing with, any governmental
authority or regulatory body or other Person is required for the due execution,
delivery or performance by the Borrower or any other Obligor of this Agreement,
the Notes or any other Loan Document to which it is a party. Neither the
Borrower nor any of its Significant Subsidiaries is an "investment company"
within the meaning of the Investment Company Act of 1940, as amended, or a
"holding company", or a "subsidiary company" of a "holding company", or an
"affiliate" of a "holding company" or of a "subsidiary company" of a "holding
company", within the meaning of the Public Utility Holding Company Act of 1935,
as amended.
SECTION 7.4. Validity, etc. This Agreement constitutes, and the Notes
and each other Loan Document executed by the Borrower will, on the due execution
and delivery thereof, constitute, the legal, valid and binding obligations of
the Borrower enforceable in accordance with their respective terms
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except as enforceability may be subject to or limited by (i) bankruptcy,
insolvency, reorganization, arrangement, moratorium or other similar laws
affecting the rights of creditors or (ii) general principles of equity,
including the possible unavailability of specific performance or injunctive
relief; and each Loan Document executed pursuant hereto by each other Obligor
will, on the due execution and delivery thereof by such Obligor, be the legal,
valid and binding obligation of such Obligor enforceable in accordance with its
terms except as enforceability may be subject to or limited by (i) bankruptcy,
insolvency, reorganization, arrangement, moratorium or other similar laws
affecting the rights of creditors or (ii) general principles of equity,
including the possible unavailability of specific performance or injunctive
relief.
SECTION 7.5. Financial Information. The balance sheets of the Borrower
and each of its Subsidiaries as at December 31, 1999 and the related statements
of earnings and cash flow of the Borrower and each of its Subsidiaries, copies
of which have been furnished to the Agent and each Lender, have been prepared in
accordance with GAAP consistently applied, and present fairly the consolidated
financial condition of the corporations covered thereby as at the date thereof
and the results of their operations for the period then ended.
SECTION 7.6. No Material Adverse Effect. Since December 31, 1999, there
has been no Material Adverse Effect.
SECTION 7.7. Litigation, Labor Controversies, etc. There is no pending
or, to the knowledge of the Borrower, threatened litigation, action, proceeding,
or labor controversy affecting the Borrower or any of its Significant
Subsidiaries, or any of their respective properties, businesses, assets or
revenues, which would reasonably be expected to have a Material Adverse Effect
or which purports to materially and adversely affect the legality, validity or
enforceability of this Agreement, the Notes or any other Loan Document, except
as disclosed in Item 7.7 ("Litigation") of the Disclosure Schedule.
SECTION 7.8. Subsidiaries. The Borrower has no Significant Subsidiaries,
except those Significant Subsidiaries
(a) which are identified in Item 7.8 ("Existing
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Significant Subsidiaries") of the Disclosure Schedule; or
(b) which are permitted to have been acquired in accordance with
Section 8.2.5 or 8.2.10.
SECTION 7.9. Ownership of Properties. The Borrower and each of its
Significant Subsidiaries owns good and marketable title to all of its material
properties and assets, real and personal, tangible and intangible, of any nature
whatsoever (including patents, trademarks, trade names, service marks and
copyrights), free and clear of all Liens, charges or claims (including
infringement claims with respect to patents, trademarks, copyrights and the
like) except as permitted pursuant to Section 8.2.3.
SECTION 7.10. Taxes. The Borrower and each of its Significant
Subsidiaries has filed all tax returns and reports required by law to have been
filed by it and has paid all taxes and governmental charges thereby shown to be
owing, except any such taxes or charges which are being diligently contested in
good faith by appropriate proceedings and for which adequate reserves in
accordance with GAAP shall have been set aside on its books.
SECTION 7.11. Pension and Welfare Plans. No steps have been taken to
terminate any Pension Plan, and no contribution failure has occurred with
respect to any Pension Plan sufficient to give rise to a Lien under section
302(f) of ERISA. No condition exists or event or transaction has occurred with
respect to any Pension Plan which might result in the incurrence by the Borrower
or any member of the Controlled Group of any material liability, fine or
penalty. Except as disclosed in Item 7.11 ("Employee Benefit Plans") of the
Disclosure Schedule, neither the Borrower nor any member of the Controlled Group
has any contingent liability with respect to any post-retirement benefit under a
Welfare Plan, other than liability for continuation coverage described in Part 6
of Title I of ERISA.
SECTION 7.12. Environmental Warranties. Except as set forth in Item 7.12
("Environmental Matters") of the Disclosure Schedule:
(a) all facilities and property (including underlying
groundwater) owned or leased by the Borrower or any of its
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Significant Subsidiaries have been, and continue to be, owned or leased
by the Borrower and its Significant Subsidiaries in material compliance
with all Environmental Laws;
(b) there have been no past, and there are no pending or, to the
Borrower's knowledge, threatened
(i) claims, complaints, notices or requests for information
received by the Borrower or any of its Significant Subsidiaries
with respect to any alleged violation of any Environmental Law
that, singly or in the aggregate, may reasonably be expected to
result in a Material Adverse Effect, or
(ii) complaints, notices or inquiries to the Borrower or any
of its Significant Subsidiaries regarding potential liability
under any Environmental Law that, singly or in the aggregate, may
reasonably be expected to result in a Material Adverse Effect;
(c) there are no unremediated Releases of Hazardous Materials at,
on or under any property now or previously owned or leased by the
Borrower or any of its Significant Subsidiaries that, singly or in the
aggregate, result in, or may reasonably be expected to result in, a
Material Adverse Effect;
(d) the Borrower and its Significant Subsidiaries have been
issued and are in material compliance with all permits, certificates,
approvals, licenses and other authorizations relating to environmental
matters and necessary for their businesses;
(e) no property now or previously owned or leased by the Borrower
or any of its Significant Subsidiaries is listed or proposed for listing
(with respect to owned property only) on the National Priorities List
pursuant to CERCLA, on the CERCLIS or on any similar state list of sites
requiring investigation or clean-up;
(f) there are no underground storage tanks, active or abandoned,
including petroleum storage tanks, on or under any property now or
previously owned or leased by the
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Borrower or any of its Significant Subsidiaries that, singly or in the
aggregate, result in, or may reasonably be expected to result in, a
Material Adverse Effect;
(g) neither Borrower nor any Significant Subsidiary of the
Borrower has directly transported or directly arranged for the
transportation of any Hazardous Material to any location which is listed
or proposed for listing on the National Priorities List pursuant to
CERCLA, on the CERCLIS or on any similar state list or which is the
subject of federal, state or local enforcement actions or other
investigations which may lead to material claims against the Borrower or
such Significant Subsidiary thereof for any remedial work, damage to
natural resources or personal injury, including claims under CERCLA;
(h) there are no polychlorinated biphenyls or friable asbestos
present at any property now or previously owned or leased by the
Borrower or any Significant Subsidiary of the Borrower that, singly or
in the aggregate, result in, or may reasonably be expected to result in,
a Material Adverse Effect; and
(i) no conditions exist at, on or under any property now or
previously owned or leased by the Borrower which, with the passage of
time, or the giving of notice or both, would give rise to liability
under any Environmental Law which would reasonably be expected to result
in a Material Adverse Effect.
SECTION 7.13. Regulations G, U and X. The Borrower is not engaged in the
business of extending credit for the purpose of purchasing or carrying margin
stock, and no proceeds of any Loans will be used for a purpose which violates
F.R.S. Board Regulation G, U or X. Terms for which meanings are provided in
F.R.S. Board Regulation G, U or X or any regulations substituted therefor, as
from time to time in effect, are used in this Section with such meanings.
SECTION 7.14. Accuracy of Information. All factual information (which
shall not include projections) heretofore or contemporaneously furnished by or
on behalf of the Borrower in writing to the Agent or any Lender for purposes of
or in
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connection with this Agreement or any transaction contemplated hereby is, and
all other such factual information hereafter furnished by or on behalf of the
Borrower to the Agent or any Lender will be, true and accurate in every material
respect on the date as of which such information is dated or certified (except
with respect to the financial statements of Borrower and its Subsidiaries, which
will fairly present the financial condition of the entities covered thereby as
of the date thereof) and, with respect to information provided prior to the
execution of this Agreement, as of the date of execution and delivery of this
Agreement by the Agent and such Lender, and such information is not, or shall
not be, as the case may be, incomplete by omitting to state any material fact
necessary to make such information not misleading.
ARTICLE VIII
COVENANTS
SECTION 8.1. Affirmative Covenants. The Borrower agrees with the Agent
and each Lender that, from and after the Effective Date, until all Commitments
have terminated and all Obligations have been paid and performed in full, the
Borrower will perform the obligations set forth in this Section 8.1.
SECTION 8.1.1. Financial Information, Reports, Notices, etc. The
Borrower will furnish, or will cause to be furnished, to each Lender and the
Agent copies of the following financial statements, reports, notices and
information:
(a) as soon as available and in any event within 60 days after
the end of each of the first three Fiscal Quarters of each Fiscal Year
of the Borrower, a consolidated balance sheet of the Borrower and its
Subsidiaries as of the end of such Fiscal Quarter and consolidated
statements of earnings and cash flow of the Borrower and its
Subsidiaries for such Fiscal Quarter and for the period commencing at
the end of the previous Fiscal Year and ending with the end of such
Fiscal Quarter, certified by an Authorized Officer of the Borrower;
(b) as soon as available and in any event within 120
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days after the end of each Fiscal Year of the Borrower, (i) a copy of
the annual audit report for such Fiscal Year for the Borrower and its
Subsidiaries, including therein consolidated and, if available,
consolidating balance sheets of the Borrower and its Subsidiaries as of
the end of such Fiscal Year, consolidated and, if available,
consolidating statements of earnings of the Borrower and its
Subsidiaries for such Fiscal Year and consolidated statements of cash
flow of the Borrower and its Subsidiaries for such Fiscal Year, in each
case certified (without any Impermissible Qualification) in a manner
acceptable to the Agent and the Required Lenders by Arthur Andersen &
Company or other independent public accountants acceptable to the Agent
and the Required Lenders and (ii) if not otherwise provided,
consolidating balance sheets of the Borrower and its Subsidiaries as of
the end of such Fiscal Year and consolidating statements of earnings of
the Borrower and its Subsidiaries as of the end of such Fiscal Year,
certified by an Authorized Officer of the Borrower;
(c) as soon as available and in any event within 60 days after
the end of each of the first three Fiscal Quarters of each Fiscal Year
and within 120 days after the end of each Fiscal Year, a certificate,
executed by an Authorized Officer of the Borrower, showing (in
reasonable detail and with appropriate calculations and computations in
all respects satisfactory to the Agent) compliance with the financial
covenants set forth in Section 8.2.4;
(d) as soon as available and in any event within ninety days
after the end of each Fiscal Year of the Borrower, a consolidated budget
for the Borrower and its Subsidiaries for the following Fiscal Year, in
form and substance satisfactory to the Agent;
(e) as soon as possible and in any event within three days after
the Borrower obtains knowledge of each Default, a statement of an
Authorized Officer of the Borrower setting forth details of such Default
and the action which the Borrower has taken and proposes to take with
respect thereto;
(f) as soon as possible and in any event within five
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days after (x) the Borrower obtains knowledge of any adverse development
with respect to any litigation, action, proceeding, or labor controversy
described in Section 7.7, (y) the commencement of any labor controversy,
litigation, action, proceeding of the type described in Section 7.7, or
(z) any other Material Adverse Effect, notice thereof and copies of all
documentation relating thereto;
(g) promptly after the sending or filing thereof, copies of all
reports which the Borrower sends to any of its securityholders, and all
reports and registration statements which the Borrower or any of its
Significant Subsidiaries files with the Securities and Exchange
Commission or any national securities exchange;
(h) immediately upon the Borrower's knowledge of the institution
of any steps by the Borrower or any member of its Controlled Group to
terminate any Pension Plan, or the failure to make a required
contribution to any Pension Plan if such failure is sufficient to give
rise to a Lien under section 302(f) of ERISA, or the taking of any
action with respect to a Pension Plan which could result in the
requirement that the Borrower furnish a bond or other security to the
PBGC or such Pension Plan, or the occurrence of any event with respect
to any Pension Plan which could result in the incurrence by the Borrower
of any material liability, fine or penalty, or any material increase in
the contingent liability of the Borrower with respect to any
post-retirement Welfare Plan benefit, notice thereof and copies of all
documentation relating thereto; and
(i) such other information respecting the condition or
operations, financial or otherwise, of the Borrower or any of its
Significant Subsidiaries as any Lender through the Agent may from time
to time reasonably request and which the Borrower is legally permitted
to provide to such Lender.
The Borrower may provide some or all of the information required in clauses (a)
and (b) above by providing copies of its Forms 10-Q and/or 10-K filed with the
Securities and Exchange Commission.
SECTION 8.1.2. Compliance with Laws, etc. The Borrower will, and will
cause each of its Subsidiaries to, comply in all material respects with all
applicable laws, rules, regulations
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and orders, such compliance to include (without limitation):
(a) the maintenance and preservation of its corporate existence
and, if applicable, qualification as a foreign corporation; and
(b) the payment, before the same become delinquent, of all taxes,
assessments and governmental charges imposed upon it or upon its
property except to the extent being diligently contested in good faith
by appropriate proceedings and for which adequate reserves in accordance
with GAAP shall have been set aside on its books.
SECTION 8.1.3. Maintenance of Properties. The Borrower will, and will
cause each of its Subsidiaries to, maintain, preserve, protect and keep its
material properties in good repair, working order and condition, and make
necessary and proper repairs, renewals and replacements so that its business
carried on in connection therewith may be properly conducted at all times unless
the Borrower determines in good faith that the continued maintenance of any of
its properties is no longer economically desirable.
SECTION 8.1.4. Insurance. The Borrower will, and will cause each of its
Subsidiaries to, maintain or cause to be maintained with responsible insurance
companies insurance with respect to its properties and business (including
business interruption insurance) against such casualties and contingencies and
of such types and in such amounts as is customary in the case of similar
businesses and will, upon request of the Agent, furnish to each Lender at
reasonable intervals a certificate of an Authorized Officer of the Borrower
setting forth the nature and extent of all insurance maintained by the Borrower
and its Subsidiaries in accordance with this Section.
SECTION 8.1.5. Books and Records. The Borrower will, and will cause each
of its Subsidiaries to, keep books and records which accurately reflect all of
its business affairs and transactions and permit the Agent or any of its
representatives, at reasonable times and intervals, to visit all of its offices,
to discuss its financial matters with its officers and independent public
accountant (and the Borrower hereby authorizes such independent public
accountant to discuss the Borrower's
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financial matters with each Lender or its representatives whether or not any
representative of the Borrower is present) and to examine (and, at the expense
of the Borrower, photocopy extracts from) any of its books or other corporate
records. The Borrower shall pay any fees of such independent public accountant
incurred in connection with one such exercise by the Agent of its rights
pursuant to this Section; provided, however, after the occurrence and during the
continuance of any Default, the Borrower shall pay for all fees of such
independent accountants incurred with each exercise by the Agent of its rights
pursuant to this Section.
SECTION 8.1.6. Environmental Covenant. The Borrower will, and will cause
each of its Significant Subsidiaries to,
(a) use and operate all of its facilities and properties in
material compliance with all Environmental Laws, keep all necessary
permits, approvals, certificates, licenses and other authorizations
relating to environmental matters in effect and remain in material
compliance therewith, and handle all Hazardous Materials in material
compliance with all applicable Environmental Laws;
(b) immediately notify the Agent and provide copies upon receipt
of all material written claims, complaints, notices or inquiries
relating to the condition of its facilities and properties or compliance
with Environmental Laws; and
(c) provide such information and certifications which the Agent
may reasonably request from time to time to evidence compliance with
this Section 8.1.6.
SECTION 8.1.7. Dividends of Subsidiaries. Promptly upon (but in no case
more than five (5) Business Days after) the occurrence of an Event of Default,
the Borrower shall cause each of its Wholly-Owned Subsidiaries to declare and
pay dividends on, or to make payments or distributions on account of, the shares
of all classes of stock of such entity in an amount equal to (x) all funds
legally and contractually available at such time to such Subsidiary for the
payment of dividends minus (y) without duplication, such Wholly-Owned
Subsidiary's budgeted working capital and budgeted cash requirements for the
following six months.
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SECTION 8.2. Negative Covenants. The Borrower agrees with the Agent and
each Lender that, from and after the Effective Date until all Commitments have
terminated and all Obligations have been paid and performed in full, the
Borrower will perform the obligations set forth in this Section 8.2.
SECTION 8.2.1. Business Activities. The Borrower will not, and will not
permit any of its Subsidiaries or Joint Ventures to, engage in any business
activity, except those described in the first recital and such activities as may
be incidental or related thereto; provided, however, that up to ten percent
(10%) of the consolidated net assets of the Borrower and its Subsidiaries may be
used for unrelated businesses.
SECTION 8.2.2. Indebtedness. The Borrower will not, and will not permit
any of its Subsidiaries to, create, incur, assume or suffer to exist or
otherwise become or be liable in respect of any Indebtedness, other than,
without duplication, the following:
(a) Indebtedness existing as of the Effective Date which is
identified in Item 8.2.2(a) ("Ongoing Indebtedness") of the Disclosure
Schedule;
(b) Indebtedness which is incurred by the Borrower or any of the
Borrower's Subsidiaries to a vendor of any assets to finance the
acquisition of such assets so long as the only recourse of such vendor
is to the assets so financed and, in the case of a Special Purpose
Subsidiary that has acquired such assets, to the stock or other
ownership interests of such Special Purpose Subsidiary;
(c) unsecured Indebtedness incurred in the ordinary course of
business (including open accounts extended by suppliers on normal trade
terms in connection with purchases of goods and services, but excluding
Indebtedness incurred through the borrowing of money or Contingent
Liabilities);
(d) Indebtedness of the Borrower which is owed to and held by a
Wholly Owned Subsidiary (it being understood and agreed that the
obligations of the Borrower under its subordinated debt securities
issued to a Trust in connection with the Guaranteed Preferred Securities
are not considered
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Indebtedness for purposes of this Agreement) and Indebtedness of a
Wholly Owned Subsidiary or Cogen America which is owed to and held by
the Borrower or a Wholly Owned Subsidiary; provided, however, that any
subsequent issuance or transfer of any capital stock which results in
any such Wholly Owned Subsidiary ceasing to be a Wholly Owned Subsidiary
or any transfer of such Indebtedness (other than to the Borrower or a
Wholly Owned Subsidiary) shall be deemed, in each case, to constitute
the incurrence of such Indebtedness by the Borrower or by a Wholly Owned
Subsidiary, as the case may be;
(e) Indebtedness of a Subsidiary of the Borrower for which
recourse is limited (i) to the asset or assets being financed, (ii) to
such Subsidiary itself, where the asset or assets being financed
constitute all or substantially all of the assets of such Subsidiary (a
"Special Purpose Subsidiary"), and/or (iii) to the stock or other
ownership interests in a Special Purpose Subsidiary;
(f) Indebtedness in respect of Capitalized Lease Liabilities,
unsecured Subordinated Debt of the Borrower and other unsecured
Indebtedness of the Borrower or a Subsidiary if, after giving effect to
the issuance thereof, the Interest Coverage Ratio calculated as of the
end of the most recent Fiscal Quarter on a pro forma basis is equal to
or greater than 2.00 to 1.00;
(g) Indebtedness secured by property or assets acquired by, or
owned by any Person acquired by, the Borrower or any of its Subsidiaries
that was in existence at the time such property, assets or Person are
acquired so long as such Indebtedness was not incurred in contemplation
of such acquisition; provided, however, that the Borrower would have
been able to incur such Indebtedness at the time of incurrence thereof
pursuant to clause (f) above (assuming for purposes of this proviso that
such Indebtedness was unsecured);
(h) unsecured Indebtedness of the Borrower or any of its
Subsidiaries arising from the endorsements of instruments for collection
in the ordinary course of business;
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(i) unsecured Indebtedness of the Borrower or any of its
Subsidiaries with respect to surety, appeal, indemnity, performance or
other similar bonds in the ordinary course of business;
(j) unsecured Hedging Obligations and unsecured Contingent
Liabilities of the Borrower or any of its Subsidiaries, in the ordinary
course of business and consistent with applicable risk management
guidelines established by the Borrower from time to time;
(k) Indebtedness in respect of commercial paper issued and sold
in the commercial paper market in an aggregate principal or stated
amount not to exceed the sum of (i) the stated amount of any letters of
credit issued under the $400,000,000 Credit Agreement to support or
secure such commercial paper plus (ii) the unused availability under the
$400,000,000 Credit Agreement; and
(l) extensions, renewals and refinancings of any of the foregoing
permitted Indebtedness (except with respect to the Loans and other
Obligations referred to in clause (j) above); provided that the
outstanding principal amount of such Indebtedness is not increased, no
obligor under such Indebtedness is liable for any such Indebtedness
except to the extent it was liable for the Indebtedness so renewed or
refinanced and if the Indebtedness being refinanced is subordinated to
the Indebtedness of any obligor, such Indebtedness shall be subordinated
at least to the same extent; provided, further, that the limitations set
forth in this clause (l) shall not apply to Indebtedness which is
otherwise permitted under this Section 8.2.2, even if such Indebtedness
is used to repay or refinance other existing Indebtedness.
provided, however, that no Indebtedness otherwise permitted by clauses (d), (f),
(g), (j) or (k) shall be permitted if, after giving effect to the incurrence
thereof, any Default (other than a Nonmaterial Subsidiary Default) shall have
occurred and be continuing.
SECTION 8.2.3. Liens. The Borrower will not, and will not
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permit any of its Subsidiaries to, create, incur, assume or suffer to exist any
Lien upon any of its property, revenues or assets, whether now owned or
hereafter acquired, except:
(a) Liens securing payment of the Obligations, granted pursuant
to any Loan Document;
(b) Liens granted prior to the Effective Date to secure payment
of Indebtedness of the type permitted and described in clause (a) of
Section 8.2.2;
(c) Liens granted to secure payment of Indebtedness of the type
permitted and described in clause (b) of Section 8.2.2 where recourse is
limited as described in clause (b) of Section 8.2.2;
(d) Liens for taxes, assessments or other governmental charges or
levies not at the time delinquent or thereafter payable without penalty
or being diligently contested in good faith by appropriate proceedings
and for which adequate reserves in accordance with GAAP shall have been
set aside on its books;
(e) Liens of carriers, warehousemen, mechanics, materialmen and
landlords incurred in the ordinary course of business for sums not
overdue or being diligently contested in good faith by appropriate
proceedings and for which adequate reserves in accordance with GAAP
shall have been set aside on its books;
(f) Liens incurred in the ordinary course of business in
connection with workmen's compensation, unemployment insurance or other
forms of governmental insurance or benefits, or to secure performance of
tenders, statutory obligations, leases and contracts (other than for
borrowed money) entered into in the ordinary course of business or to
secure obligations on surety or appeal bonds;
(g) judgment Liens in existence less than 15 days after the entry
thereof or with respect to which execution has been stayed or the
payment of which is covered in full (subject to a customary deductible)
by insurance maintained with responsible insurance companies;
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(h) Liens granted to secure payment of Indebtedness of the type
permitted and described in clauses (e) and (g) of Section 8.2.2 where
recourse is limited as described in clauses (e) or (g), as applicable,
of Section 8.2.2;
(i) Zoning restrictions, easements, rights of way, title
irregularities and other similar encumbrances which alone or in the
aggregate do not materially detract from the value of the property
subject thereto;
(j) Liens on the property or assets of any Subsidiary of the
Borrower in favor of the Borrower;
(k) Banker's Liens and similar Liens (including set-off rights)
in respect of bank deposits;
(l) Landlord's Liens and similar Liens in respect of leased
property;
(m) Liens securing Attributable Debt with respect to outstanding
leases entered into pursuant to Sale/Leaseback Transactions so long as
the amount thereof does not exceed 10% of the consolidated tangible
assets of the Borrower and its Subsidiaries; and
(n) Liens incurred in connection with the extension, renewal or
refinancing of Indebtedness secured by Liens permitted and described in
clauses (b), (c) and (h) of this Section 8.2.3; provided, however, that
(x) such new Lien shall be limited to all or part of the same property
that secured the original Lien and (y) the Indebtedness secured by such
Lien at such time is not increased (other than by an amount necessary to
pay fees and expenses, including premiums, related to the refinancing,
refunding, extension, renewal or replacement of such Indebtedness);
provided, further, that the limitations set forth in this clause (n)
shall not apply to Liens which are otherwise permitted under this
Section 8.2.3, even if such Liens secure Indebtedness issued to repay or
refinance existing Indebtedness permitted and described in clauses (b),
(c) and (h) of this Section 8.2.3.
SECTION 8.2.4. Financial Condition. The Borrower will not
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permit:
(a) Its Tangible Net Worth to be less than (i) $820,699,000 plus
(ii) 50% of the Consolidated Net Income of the Borrower and its
Subsidiaries (without giving effect to any losses) for each Fiscal
Quarter ending on or after December 31, 1999 plus (iii) 100% of the Net
Equity Proceeds from any equity offering by the Borrower after the date
hereof.
(b) Its Leverage Ratio to be greater than .85 to 1.00 as of the
end of any Fiscal Quarter.
(c) Its Interest Coverage Ratio as of the end of any Fiscal
Quarter, to be less than 1.75 to 1.00 for the twelve (12) month period
comprising the four previous Fiscal Quarters.
(d) Its Interest Coverage Ratio (Parent Only) as of the end of
any Fiscal Quarter, to be less than 1.60 to 1.00 for the twelve (12)
month period comprising the four previous Fiscal Quarters.
SECTION 8.2.5. Investments. The Borrower will not, and will not permit
any of its Subsidiaries to, make, incur, assume or suffer to exist any
Investment in any other Person, except:
(a) Investments existing on the Effective Date and identified in
Item 8.2.5(a) ("Ongoing Investments") of the Disclosure Schedule;
(b) Cash Equivalent Investments; and
(c) in the ordinary course of business, Investments by the
Borrower in any of its Subsidiaries or in any Investment Joint Venture
of the Borrower or Investments by the Borrower's Subsidiaries in other
Subsidiaries or in any Investment Joint Venture of the Borrower, whether
now existing or hereafter organized in permitted lines of business of
the Borrower and its Subsidiaries and lines of business related thereto
by way of contributions to capital or loans or advances;
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(d) from and after the Effective Date, in the ordinary course of
business, Investments by the Borrower or any of its Subsidiaries in
Persons that are not Subsidiaries of the Borrower or Investment Joint
Ventures of the Borrower so long as such Persons are engaged only in
permitted lines of business of the Borrower and its Subsidiaries and
lines of business related thereto and so long as no such single
Investment (or series of related Investments) exceeds 5% of the
Borrower's consolidated tangible assets as of the end of the most recent
Fiscal Quarter for which the Borrower has delivered the financial
statements required under Section 7.1.1 hereof and the aggregate of all
such Investments at any time outstanding does not exceed 10% of the
Borrower's consolidated tangible assets as of the end of the most recent
Fiscal Quarter for which the Borrower has delivered the financial
statements required under Section 7.1.1 hereof;
provided, however, that
(e) any Investment which when made complies with the requirements
of the definition of the term "Cash Equivalent Investment" may continue
to be held notwithstanding that such Investment if made thereafter would
not comply with such requirements; and
(f) no Investment otherwise permitted by clauses (c) or (d) shall
be permitted to be made if, immediately before or after giving effect
thereto, any Material Adverse Effect or any Default (other than a
Nonmaterial Subsidiary Default) shall have occurred and be continuing.
SECTION 8.2.6. Restricted Payments, etc. On and at all times after the
Effective Date:
(a) the Borrower will not declare, pay or make any dividend or
distribution (in cash, property or obligations) on any shares of any
class of capital stock (now or hereafter outstanding) of the Borrower or
on any warrants, options or other rights with respect to any shares of
any class of capital stock (now or hereafter outstanding) of the
Borrower (other than dividends or distributions payable in its common
stock or warrants to purchase its common stock or splitups or
reclassifications of its stock into additional
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or other shares of its common stock) or apply, or permit any of its
Subsidiaries to apply, any of its funds, property or assets to the
purchase, redemption, sinking fund or other retirement of, or agree or
permit any of its Subsidiaries to purchase or redeem, any shares of any
class of capital stock (now or hereafter outstanding) of the Borrower,
or warrants, options or other rights with respect to any shares of any
class of capital stock (now or hereafter outstanding) of the Borrower;
(b) the Borrower will not, and will not permit any of its
Subsidiaries to
(i) make any payment or prepayment of principal of, or make
any payment of interest on, any Senior Notes or any Subordinated
Debt on any day other than the stated date for such payment or
prepayment set forth in the documents and instruments
memorializing any Senior Notes or such Subordinated Debt, or
which would violate the subordination provisions of any such
Subordinated Debt; provided, that the Borrower may pay or prepay
all or a portion of the Senior Notes if both before and after
giving effect thereto, no Default shall have occurred or be
continuing and there are no Loans outstanding hereunder; or
(ii) redeem, purchase or defease any Senior Notes or any
Subordinated Debt unless the effect of such redemption, purchase
or defeasance is to make a payment or prepayment permitted under
clause (b)(i);
(c) the Borrower will not, and will not permit any Subsidiary to,
make any deposit for any of the foregoing purposes except to the extent
a payment or prepayment would be otherwise permitted hereunder; and
(d) the Borrower will not, and will not permit any of its
Subsidiaries to, make any voluntary prepayment of principal of any
Indebtedness, if either before or after giving effect thereto, there
shall exist a Default (other than a Nonmaterial Subsidiary Default) or
an Event of Default.
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SECTION 8.2.7. Capital Expenditures and Investments. The Borrower will
not make or commit to make Capital Expenditures for or Investments in, or in
connection with, any new project if a Default (other than a Nonmaterial
Subsidiary Default) or Event of Default shall have occurred and be continuing;
provided, however, that if on the date of any such Default, the Borrower is
contractually obligated to make such a Capital Expenditure or Investment, the
Borrower shall be permitted to make such Capital Expenditure or Investment.
SECTION 8.2.8. Rental Obligations. The Borrower will not enter into at
any time any arrangement which does not create a Capitalized Lease Liability or
a Sale/Leaseback Transaction and which involves the leasing by the Borrower from
any lessor of any real or personal property (or any interest therein), except
arrangements which, together with all other such arrangements which shall then
be in effect, will not require the payment of an aggregate amount of rentals by
the Borrower in excess of (excluding escalations resulting from a rise in the
consumer price or similar index) $10,000,000 for any Fiscal Year or $50,000,000
during the full remaining term of such arrangements; provided, however, that any
calculation made for purposes of this Section shall exclude any amounts required
to be expended for maintenance and repairs, insurance, taxes, assessments, and
other similar charges.
SECTION 8.2.9. Consolidation, Merger, etc. The Borrower will not, and
will not permit any of its Subsidiaries to, liquidate or dissolve, consolidate
with, or merge into or with, any other corporation, or purchase or otherwise
acquire all or substantially all of the assets of any Person (or of any division
thereof) except
(a) the Borrower or a Wholly Owned Subsidiary may merge with
another Person if (i) (A) the Borrower or such Subsidiary is the
continuing Person following such merger or (B) in the case of a merger
by the Borrower, the Person (if other than the Borrower) formed by such
merger (including a consolidation effected by a sale or transfer of all
or substantially all of the assets of a Person) is a corporation
organized and existing under the laws of the United States or any State
thereof or the District of Columbia and expressly assumes the
obligations of the
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Borrower under this Agreement, (ii) such merger or consolidation is
otherwise permitted under the Senior Note Indentures, (iii) no Default
(other than a Nonmaterial Subsidiary Default) has occurred and is
continuing or would occur after giving effect thereto and (iv) after
giving effect thereto, the Borrower's S&P Rating shall not be reduced
below BB- and the Borrower's Moody's Rating shall not be reduced below
Ba3;
(b) any such Subsidiary may liquidate or dissolve voluntarily
into, and may merge with and into, the Borrower or any other Subsidiary,
and the assets or stock of any Subsidiary may be purchased or otherwise
acquired by the Borrower or any other Subsidiary; provided, however, in
no event may a Subsidiary that holds a direct interest in a power
generating facility merge with any other Subsidiary that holds a direct
or indirect interest in any other power generating facility or other
business; and
(c) so long as no Default (other than a Nonmaterial Subsidiary
Default) has occurred and is continuing or would occur after giving
effect thereto, the Borrower or any of its Subsidiaries may purchase all
or substantially all of the assets or stock of any Person if permitted
(without duplication) by Section 8.2.5 and Section 8.2.7.
SECTION 8.2.10. Asset Dispositions, etc. The Borrower will not, and will
not permit any of its Subsidiaries to, sell, transfer, lease, contribute or
otherwise convey, or grant options, warrants or other rights with respect to,
all or any substantial part of its assets (including accounts receivable and
capital stock of Subsidiaries) to any Person, unless
(a) such sale, transfer, lease, contribution or conveyance is in
the ordinary course of its business or is permitted by Section 8.2.9; or
(b) (i) the Borrower or its Subsidiary receives consideration at
the time of such sale, transfer, lease, contribution or conveyance at
least equal to the fair market value of assets being sold, transferred,
leased, contributed or conveyed, (ii) at least sixty percent (60%) of
the consideration received by the Borrower or such
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Subsidiary is in the form of cash or cash equivalents and (iii) an
amount equal to 100% of Net Available Cash is either (x) reinvested in
Additional Assets within 365 days of such asset sale or (y) used by the
Borrower to prepay the Loans.
SECTION 8.2.11. Modification of Certain Agreements. The Borrower will
not consent to any amendment, supplement or other modification of any of the
terms or provisions contained in, or applicable to, the Senior Notes or the
Senior Note Indentures, or any document or instrument evidencing or applicable
to any Subordinated Debt, other than any amendment, supplement or other
modification which extends the date or reduces the amount of any required
repayment or redemption.
SECTION 8.2.12. Transactions with Affiliates. Except for transactions
between the Borrower and its Wholly Owned Subsidiaries or Cogen America or
between one Wholly Owned Subsidiary and another Wholly Owned Subsidiary or Cogen
America, the Borrower will not, and will not permit any of its Subsidiaries to,
enter into, or cause, suffer or permit to exist any arrangement or contract with
any of its other Affiliates unless such arrangement or contract is fair and
equitable to the Borrower or such Subsidiary and is an arrangement or contract
of the kind which would be entered into by a prudent Person in the position of
the Borrower or such Subsidiary with a Person which is not one of its
Affiliates.
SECTION 8.2.13. Negative Pledges, Restrictive Agreements, etc. The
Borrower will not, and will not permit any of its Subsidiaries to, enter into
any agreement (excluding this Agreement, any other Loan Document and any
agreement governing any Indebtedness permitted either by clause (a) of Section
8.2.2 as in effect on the Effective Date or by clauses (b) and (e) of Section
8.2.2, clause (f) of Section 8.2.2 for Capitalized Lease Liabilities incurred by
a Subsidiary that is formed after the Effective Date, and clause (g) of Section
8.2.2 (and refinancings, extensions and renewals of such Indebtedness permitted
under clause (l) of Section 8.2.2) as to the assets financed with the proceeds
of such Indebtedness) prohibiting
(a) the creation or assumption of any Lien upon its properties,
revenues or assets, whether now owned or
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hereafter acquired, or the ability of the Borrower or any other Obligor
to amend or otherwise modify this Agreement or any other Loan Document;
or
(b) the ability of any Subsidiary to make any payments, directly
or indirectly, to the Borrower by way of dividends, advances, repayments
of loans or advances, reimbursements of management and other
intercompany charges, expenses and accruals or other returns on
investments, or any other agreement or arrangement which restricts the
ability of any such Subsidiary to make any payment, directly or
indirectly, to the Borrower.
ARTICLE IX
EVENTS OF DEFAULT
SECTION 9.1. Listing of Events of Default. Each of the following events
or occurrences described in this Section 9.1 shall constitute an "Event of
Default".
SECTION 9.1.1. Non-Payment of Obligations. The Borrower shall default in
the payment or prepayment when due of any principal of any Loan, or the Borrower
shall default (and such default shall continue unremedied for a period of five
days) in the payment when due of interest on any Loan, any fee or of any other
Obligation.
SECTION 9.1.2. Breach of Warranty. Any representation or warranty of the
Borrower or any other Obligor made or deemed to be made hereunder or in any
other Loan Document executed by it or any other writing or certificate furnished
by or on behalf of the Borrower or any other Obligor to the Agent or any Lender
for the purposes of or in connection with this Agreement or any such other Loan
Document (including any certificates delivered pursuant to Article VI) is or
shall be incorrect when made in any material respect.
SECTION 9.1.3. Non-Performance of Certain Covenants and Obligations. The
Borrower shall default in the due performance and observance of any of its
obligations under Section 8.2 and such default shall continue unremedied for a
period of 10 days
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after the earlier of (i) current, actual knowledge thereof by the Borrower or
(ii) notice thereof has been given to the Borrower by the Agent.
SECTION 9.1.4. Non-Performance of Other Covenants and Obligations. Any
Obligor shall default in the due performance and observance of any other
agreement contained herein or in any other Loan Document executed by it, and
such default shall continue unremedied for a period of 30 days after notice
thereof shall have been given to the Borrower by the Agent or any Lender (or
such longer period as the Required Lenders in their discretion, may agree,
provided that such Obligor has commenced such cure within such 30 day period and
thereafter diligently pursues such cure to completion).
SECTION 9.1.5. Default on Other Indebtedness. A default shall occur in
the payment when due (subject to any applicable grace period), whether by
acceleration or otherwise, of any Indebtedness (other than Indebtedness
described in Section 9.1.1) of the Borrower or any of its Significant
Subsidiaries or any other Obligor having a principal amount, individually or in
the aggregate, in excess of $10,000,000, or a default shall occur in the
performance or observance of any obligation or condition with respect to such
Indebtedness if the effect of such default is to accelerate the maturity of any
such Indebtedness or, in the case of the Borrower only, such default shall
continue unremedied for any applicable period of time sufficient to permit the
holder or holders of such Indebtedness, or any trustee or agent for such
holders, to cause such Indebtedness to become due and payable prior to its
expressed maturity or a default shall occur in the performance or observance of
any obligation or condition with respect to any Indebtedness of any Significant
Subsidiary or Obligor having a principal amount in excess of $10,000,000 and, as
a result thereof, the holder or holders of such Indebtedness, or any trustee or
agent for such holders, causes such Indebtedness to be repaid more quickly than
theretofore scheduled, whether through the introduction of a "cash sweep," the
increase of an existing "cash sweep" or otherwise.
SECTION 9.1.6. Judgments. Any final judgment or order (not covered by
insurance) for the payment of money shall be rendered against the Borrower or
any Significant Subsidiary or any other Obligor in an amount in excess of
$25,000,000 (or its foreign currency equivalent) (treating any deductibles,
self-insurance or retention as not so covered) which is not stayed or discharged
within 30 days after entry of such final judgment or order, and there shall be
any period of more than 30 consecutive days following entry of the final
judgment or order in excess of $25,000,000 (or its
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foreign currency equivalent) during which a stay of enforcement of such final
judgment or order, by reason of a pending appeal or otherwise, shall not be in
effect.
SECTION 9.1.7. Pension Plans. Any of the following events shall occur
with respect to any Pension Plan
(a) the institution of any steps by the Borrower, any member of
its Controlled Group or any other Person to terminate a Pension Plan if,
as a result of such termination, the Borrower or any such member could
be required to make a contribution to such Pension Plan, or could
reasonably expect to incur a liability or obligation to such Pension
Plan, in excess of $10,000,000; or
(b) a contribution failure occurs with respect to any Pension
Plan sufficient to give rise to a Lien under Section 302(f) of ERISA.
SECTION 9.1.8. Control of the Borrower. Any Change in Control shall
occur.
SECTION 9.1.9. Bankruptcy, Insolvency, etc. The Borrower or any of its
Significant Subsidiaries or any other Obligor shall
(a) become insolvent or generally fail to pay, or admit in
writing its inability or unwillingness to pay, debts as they become due;
(b) apply for, consent to, or acquiesce in, the appointment of a
trustee, receiver, sequestrator or other custodian for the Borrower or
any of its Significant Subsidiaries or any other Obligor or any property
of any thereof, or make a general assignment for the benefit of
creditors;
(c) in the absence of such application, consent or
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acquiescence, permit or suffer to exist the appointment of a trustee,
receiver, sequestrator or other custodian for the Borrower or any of its
Significant Subsidiaries or any other Obligor or for a substantial part
of the property of any thereof, and such trustee, receiver, sequestrator
or other custodian shall not be discharged within 60 days, provided that
the Borrower, each Significant Subsidiary and each other Obligor hereby
expressly authorizes the Agent and each Lender to appear in any court
conducting any relevant proceeding during such 60-day period to
preserve, protect and defend their rights under the Loan Documents;
(d) permit or suffer to exist the commencement of any bankruptcy,
reorganization, debt arrangement or other case or proceeding under any
bankruptcy or insolvency law, or any dissolution, winding up or
liquidation proceeding, in respect of the Borrower or any of its
Significant Subsidiaries or any other Obligor, and, if any such case or
proceeding is not commenced by the Borrower or such Significant
Subsidiary or such other Obligor, such case or proceeding shall be
consented to or acquiesced in by the Borrower or such Significant
Subsidiary or such other Obligor or shall result in the entry of an
order for relief or shall remain for 60 days undismissed, provided that
the Borrower, each Significant Subsidiary and each other Obligor hereby
expressly authorizes the Agent and each Lender to appear in any court
conducting any such case or proceeding during such 60-day period to
preserve, protect and defend their rights under the Loan Documents; or
(e) take any action authorizing any of the foregoing.
SECTION 9.1.10. Impairment of Security, etc. Any Loan Document shall
(except in accordance with its terms), in whole or in part, terminate, cease to
be effective or cease to be the legally valid, binding and enforceable
obligation of any Obligor party thereto; or the Borrower, any other Obligor or
any Subsidiary shall, directly or indirectly, contest in any manner such
effectiveness, validity, binding nature or enforceability.
SECTION 9.2. Action if Bankruptcy. If any Event of Default described in
clauses (a) through (d) of Section 9.1.9 shall occur with respect to the
Borrower or any Significant
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Subsidiary or any other Obligor, the Commitments (if not theretofore terminated)
shall automatically terminate and the outstanding principal amount of all
outstanding Loans and all other Obligations shall automatically be and become
immediately due and payable, without notice or demand.
SECTION 9.3. Action if Other Event of Default. If any Event of Default
(other than any Event of Default described in clauses (a) through (d) of Section
9.1.9 with respect to the Borrower or any Significant Subsidiary or any other
Obligor) shall occur for any reason, whether voluntary or involuntary, and be
continuing, the Agent, upon the direction of the Required Lenders, shall by
notice to the Borrower declare all or any portion of the outstanding principal
amount of the Loans and other Obligations to be due and payable and/or the
Commitments (if not theretofore terminated) to be terminated, whereupon the full
unpaid amount of such Loans and other Obligations which shall be so declared due
and payable shall be and become immediately due and payable, without further
notice, demand or presentment, and/or, as the case may be, the Commitments shall
terminate.
ARTICLE X
THE AGENT
SECTION 10.1. Actions. Each Lender hereby appoints Scotiabank as its
Agent under and for purposes of this Agreement, the Notes and each other Loan
Document. Each Lender authorizes the Agent to act on behalf of such Lender under
this Agreement, the Notes and each other Loan Document and, in the absence of
other written instructions from the Required Lenders received from time to time
by the Agent (with respect to which the Agent agrees that it will comply, except
as otherwise provided in this Section or as otherwise advised by counsel), to
exercise such powers hereunder and thereunder as are specifically delegated to
or required of the Agent by the terms hereof and thereof, together with such
powers as may be reasonably incidental thereto. Each Lender hereby indemnifies
(which indemnity shall survive any termination of this Agreement) the Agent, pro
rata according to such Lender's Percentage, from and against any and all
liabilities, obligations, losses, damages, claims, costs or
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expenses of any kind or nature whatsoever which may at any time be imposed on,
incurred by, or asserted against, the Agent in any way relating to or arising
out of this Agreement, the Notes and any other Loan Document, including
reasonable attorneys' fees, and as to which the Agent is not reimbursed by the
Borrower; provided, however, that no Lender shall be liable for the payment of
any portion of such liabilities, obligations, losses, damages, claims, costs or
expenses which are determined by a court of competent jurisdiction in a final
proceeding to have resulted from the Agent's gross negligence or wilful
misconduct. The Agent shall not be required to take any action hereunder, under
the Notes or under any other Loan Document, or to prosecute or defend any suit
in respect of this Agreement, the Notes or any other Loan Document, unless it is
indemnified hereunder to its satisfaction. If any indemnity in favor of the
Agent shall be or become, in the Agent's determination, inadequate, the Agent
may call for additional indemnification from the Lenders and cease to do the
acts indemnified against hereunder until such additional indemnity is given.
SECTION 10.2. Funding Reliance, etc. Unless the Agent shall have been
notified by telephone, confirmed in writing, by any Lender by 5:00 p.m., San
Francisco time, on the day prior to a Borrowing that such Lender will not make
available the amount which would constitute its Percentage of such Borrowing on
the date specified therefor, the Agent may assume that such Lender has made such
amount available to the Agent and, in reliance upon such assumption, make
available to the Borrower a corresponding amount. If and to the extent that such
Lender shall not have made such amount available to the Agent, such Lender and
the Borrower severally agree to repay the Agent forthwith on demand such
corresponding amount together with interest thereon, for each day from the date
the Agent made such amount available to the Borrower to the date such amount is
repaid to the Agent, at the interest rate applicable at the time to Loans
comprising such Borrowing.
SECTION 10.3. Exculpation. Neither the Agent nor any of its directors,
officers, employees or agents shall be liable to any Lender for any action taken
or omitted to be taken by it under this Agreement or any other Loan Document, or
in connection herewith or therewith, except for its own wilful misconduct or
gross negligence, nor responsible for any recitals or warranties
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herein or therein, nor for the effectiveness, enforceability, validity or due
execution of this Agreement or any other Loan Document, nor for the creation,
perfection or priority of any Liens purported to be created by any of the Loan
Documents, or the validity, genuineness, enforceability, existence, value or
sufficiency of any collateral security, nor to make any inquiry respecting the
performance by the Borrower of its obligations hereunder or under any other Loan
Document. Any such inquiry which may be made by the Agent shall not obligate it
to make any further inquiry or to take any action. The Agent shall be entitled
to rely upon advice of counsel concerning legal matters and upon any notice,
consent, certificate, statement or writing which the Agent believes to be
genuine and to have been presented by a proper Person.
SECTION 10.4. Successor. The Agent may resign as such at any time upon
at least 30 days' prior notice to the Borrower and all Lenders. If the Agent at
any time shall resign, the Required Lenders may appoint another Lender as a
successor Agent which shall thereupon become the Agent hereunder. If no
successor Agent shall have been so appointed by the Required Lenders, and shall
have accepted such appointment, within 30 days after the retiring Agent's giving
notice of resignation, then the retiring Agent may, on behalf of the Lenders,
appoint a successor Agent, which shall be one of the Lenders or a commercial
banking institution organized under the laws of the U.S. (or any State thereof)
or a U.S. branch or agency of a commercial banking institution, and having a
combined capital and surplus of at least $500,000,000. Upon the acceptance of
any appointment as Agent hereunder by a successor Agent, such successor Agent
shall be entitled to receive from the retiring Agent such documents of transfer
and assignment as such successor Agent may reasonably request, and shall
thereupon succeed to and become vested with all rights, powers, privileges and
duties of the retiring Agent, and the retiring Agent shall be discharged from
its duties and obligations under this Agreement. After any retiring Agent's
resignation hereunder as the Agent, the provisions of
(a) this Article X shall inure to its benefit as to any actions
taken or omitted to be taken by it while it was the Agent under this
Agreement; and
(b) Section 11.3 (with respect to expenses incurred
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prior to resignation) and Section 11.4 shall continue to inure to its
benefit.
SECTION 10.5. Loans by Scotiabank. Scotiabank shall have the same rights
and powers with respect to (x) the Loans made by it or any of its Affiliates and
(y) the Notes held by it or any of its Affiliates as any other Lender and may
exercise the same as if it were not the Agent. Scotiabank and its Affiliates may
accept deposits from, lend money to, and generally engage in any kind of
business with the Borrower or any Subsidiary or Affiliate of the Borrower as if
Scotiabank were not the Agent hereunder.
SECTION 10.6. Credit Decisions. Each Lender acknowledges that it has,
independently of the Agent and each other Lender, and based on such Lender's
review of the financial information of the Borrower, this Agreement, the other
Loan Documents (the terms and provisions of which being satisfactory to such
Lender) and such other documents, information and investigations as such Lender
has deemed appropriate, made its own credit decision to extend its Commitments.
Each Lender also acknowledges that it will, independently of the Agent and each
other Lender, and based on such other documents, information and investigations
as it shall deem appropriate at any time, continue to make its own credit
decisions as to exercising or not exercising from time to time any rights and
privileges available to it under this Agreement or any other Loan Document.
SECTION 10.7. Copies, etc. The Agent shall give prompt notice to each
Lender of each notice or request required or permitted to be given to the Agent
by the Borrower pursuant to the terms of this Agreement (unless concurrently
delivered to the Lenders by the Borrower). The Agent will distribute to each
Lender each document or instrument received for its account and copies of all
other communications received by the Agent from the Borrower for distribution to
the Lenders by the Agent in accordance with the terms of this Agreement.
ARTICLE XI
MISCELLANEOUS PROVISIONS
SECTION 11.1. Waivers, Amendments, etc. The provisions of this Agreement
and of each other Loan Document may from time to
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<PAGE> 80
time be amended, modified or waived, if such amendment, modification or waiver
is in writing and consented to by the Borrower and the Required Lenders;
provided, however, that no such amendment, modification or waiver which would:
(a) modify any requirement hereunder that any particular action
be taken by all the Lenders or by the Required Lenders shall be
effective unless consented to by each Lender;
(b) modify this Section 11.1, change the definition of "Required
Lenders", increase any Commitment Amount or the Percentage of any
Lender, extend the due date for or reduce any fees described in Article
III, extend any Commitment Termination Date shall be made without the
consent of each Lender and each holder of a Note;
(c) extend the due date for, or reduce the amount of, any
scheduled repayment or prepayment of principal of or interest on any
Loan (or reduce the principal amount of or rate of interest on any Loan)
shall be made without the consent of the holder of that Note evidencing
such Loan; or
(d) affect adversely the interests, rights or obligations of the
Agent qua the Agent shall be made without consent of the Agent.
In addition, Section 6.3 shall not be amended without the consent of the Agent.
No failure or delay on the part of the Agent, any Lender or the holder of any
Note in exercising any power or right under this Agreement or any other Loan
Document shall operate as a waiver thereof, nor shall any single or partial
exercise of any such power or right preclude any other or further exercise
thereof or the exercise of any other power or right. No notice to or demand on
the Borrower in any case shall entitle it to any notice or demand in similar or
other circumstances. No waiver or approval by the Agent, any Lender or the
holder of any Note under this Agreement or any other Loan Document shall, except
as may be otherwise stated in such waiver or approval, be applicable to
subsequent transactions. No waiver or approval hereunder shall require any
similar or dissimilar waiver or approval thereafter to be granted hereunder.
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<PAGE> 81
SECTION 11.2. Notices. All notices and other communications provided to
any party hereto under this Agreement or any other Loan Document shall be in
writing or by facsimile and addressed, delivered or transmitted to such party at
its address or facsimile number set forth below its signature hereto or set
forth in the Lender Assignment Agreement or at such other address or facsimile
number as may be designated by such party in a notice to the other parties. Any
notice, if mailed and properly addressed with postage prepaid or if properly
addressed and sent by pre-paid courier service, shall be deemed given when
received; any notice, if transmitted by facsimile, shall be deemed given when
transmitted.
SECTION 11.3. Payment of Costs and Expenses. The Borrower agrees to pay
on demand all reasonable expenses of the Agent (including the reasonable fees
and out-of-pocket expenses of counsel to the Agent and of local counsel, if any,
who may be retained by counsel to the Agent) in connection with
(a) the negotiation, preparation, execution and delivery of this
Agreement and of each other Loan Document, including schedules and
exhibits, and any amendments, waivers, consents, supplements or other
modifications to this Agreement or any other Loan Document as may from
time to time hereafter be required, whether or not the transactions
contemplated hereby are consummated, and
(b) the preparation and review of the form of any document or
instrument relevant to this Agreement or any other Loan Document.
The Borrower further agrees to pay, and to save the Agent and the
Lenders harmless from all liability for, any stamp or other taxes (other than
income taxes) which may be payable in connection with the execution or delivery
of this Agreement, the borrowings hereunder, the issuance of the Notes, or any
other Loan Documents. The Borrower also agrees to reimburse the Agent and each
Lender upon demand for all reasonable out-of-pocket expenses (including
attorneys' fees and legal expenses) incurred by the Agent or such Lender in
connection with (x) the negotiation of any restructuring or "work-out", whether
or not consummated, of any Obligations and (y) the enforcement of any
Obligations upon and during the continuing of an Event of
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<PAGE> 82
Default.
SECTION 11.4. Indemnification. In consideration of the execution and
delivery of this Agreement by each Lender and the extension of the Commitments,
the Borrower hereby indemnifies, exonerates and holds the Agent and each Lender
and each of their respective officers, directors, employees and agents
(collectively, the "Indemnified Parties") free and harmless from and against any
and all actions, causes of action, suits, losses, costs, liabilities and
damages, and expenses incurred by any Indemnified Party in connection therewith
(irrespective of whether any such Indemnified Party is a party to the action for
which indemnification hereunder is sought), including reasonable attorneys' fees
and disbursements (collectively, the "Indemnified Liabilities"), incurred by the
Indemnified Parties or any of them as a result of, or arising out of, or
relating to
(a) any transaction financed or to be financed in whole or in
part, directly or indirectly, with the proceeds of any Loan;
(b) the entering into and performance of this Agreement and any
other Loan Document by any of the Indemnified Parties (including any
action brought by or on behalf of the Borrower as the result of the
Required Lenders' refusal to make any Credit Extension as a result of
the Borrower's failure to satisfy the conditions in Article VI hereof
but not including any breach of this Agreement or any other Loan
Document by the Agent or any of the Lenders);
(c) any investigation, litigation or proceeding related to any
acquisition or proposed acquisition by the Borrower or any of its
Subsidiaries of all or any portion of the stock or assets of any Person,
whether or not the Agent or such Lender is party thereto;
(d) any investigation, litigation or proceeding related to any
environmental cleanup, audit, compliance or other matter relating to the
protection of the environment or the Release by the Borrower or any of
its Subsidiaries of any Hazardous Material; or
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<PAGE> 83
(e) the presence on or under, or the escape, seepage, leakage,
spillage, discharge, emission, discharging or releases from, any real
property owned or operated by the Borrower or any Subsidiary thereof of
any Hazardous Material (including any losses, liabilities, damages,
injuries, costs, expenses or claims asserted or arising under any
Environmental Law), regardless of whether caused by, or within the
control of, the Borrower or such Subsidiary,
except for any such Indemnified Liabilities resulting from, arising out of or
relating to the relevant Indemnified Party's gross negligence or wilful
misconduct. If and to the extent that the foregoing undertaking may be
unenforceable for any reason, the Borrower hereby agrees to make the maximum
contribution to the payment and satisfaction of each of the Indemnified
Liabilities which is permissible under applicable law.
SECTION 11.5. Survival. The obligations of the Borrower under Sections
5.3, 5.4, 5.5, 5.6, 11.3 and 11.4, and the obligations of the Lenders under
Section 10.1, shall in each case survive any termination of this Agreement, the
payment in full of all Obligations and the termination of all Commitments. The
representations and warranties made by each Obligor in this Agreement and in
each other Loan Document shall survive the execution and delivery of this
Agreement and each such other Loan Document.
SECTION 11.6. Severability. Any provision of this Agreement or any other
Loan Document which is prohibited or unenforceable in any jurisdiction shall, as
to such provision and such jurisdiction, be ineffective to the extent of such
prohibition or unenforceability without invalidating the remaining provisions of
this Agreement or such Loan Document or affecting the validity or enforceability
of such provision in any other jurisdiction.
SECTION 11.7. Headings. The various headings of this Agreement and of
each other Loan Document are inserted for convenience only and shall not affect
the meaning or interpretation of this Agreement or such other Loan Document or
any provisions hereof or thereof.
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<PAGE> 84
SECTION 11.8. Execution in Counterparts, Effectiveness, etc. This
Agreement may be executed by the parties hereto in several counterparts, each of
which shall be executed by the Borrower and the Agent and be deemed to be an
original and all of which shall constitute together but one and the same
agreement. This Agreement shall become effective when counterparts hereof
executed on behalf of the Borrower and each Lender (or notice thereof
satisfactory to the Agent) shall have been received by the Agent and the
conditions set forth in Section 6.1 shall have been satisfied.
SECTION 11.9. Governing Law; Entire Agreement. THIS AGREEMENT, THE NOTES
AND EACH OTHER LOAN DOCUMENT SHALL EACH BE DEEMED TO BE A CONTRACT MADE UNDER
AND GOVERNED BY THE INTERNAL LAWS OF THE STATE OF NEW YORK. This Agreement, the
Notes and the other Loan Documents constitute the entire understanding among the
parties hereto with respect to the subject matter hereof and supersede any prior
agreements, written or oral, with respect thereto.
SECTION 11.10. Successors and Assigns. This Agreement shall be binding
upon and shall inure to the benefit of the parties hereto and their respective
successors and assigns; provided, however, that:
(a) the Borrower may not assign or transfer its rights or
obligations hereunder without the prior written consent of the Agent and
all Lenders; and
(b) the rights of sale, assignment and transfer of the Lenders
are subject to Section 11.11.
SECTION 11.11. Sale and Transfer of Loans and Notes; Participations in
Loans and Notes. Each Lender may assign, or sell participations in, its Loans
and Commitments to one or more other Persons in accordance with this Section
11.11.
SECTION 11.11.1. Assignments. Any Lender,
(a) with the written consents of the Borrower and the Agent
(which consents shall not be unreasonably withheld and which consent, in
the case of the Borrower, shall be deemed to have been given in the
absence of a written
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<PAGE> 85
notice delivered by the Borrower to the Agent, on or before the tenth
Business Day after receipt by the Borrower of such Lender's request for
consent, stating, in reasonable detail, the reasons why the Borrower
proposes to withhold such consent) may at any time assign and delegate
to one or more commercial banks or other financial institutions, and
(b) with notice to the Borrower and the Agent and with the
written consent of the Agent (which consent shall not be unreasonably
withheld), may assign and delegate to any of its Affiliates or to any
other Lender
(each Person described in either of the foregoing clauses as being the Person to
whom such assignment and delegation is to be made, being hereinafter referred to
as an "Assignee Lender"), all or a fraction of such Lender's total Loans and
Commitments (which assignment and delegation shall be of a constant, and not a
varying, percentage of all the assigning Lender's Loans and Commitments) in a
minimum aggregate amount of $10,000,000 or, if less, the amount of such Lender's
Commitment; provided, however, that any such Assignee Lender will comply, if
applicable, with the provisions contained in the last sentence of Section 5.6
and further, provided, however, that, the Borrower, each other Obligor and the
Agent shall be entitled to continue to deal solely and directly with such Lender
in connection with the interests so assigned and delegated to an Assignee Lender
until
(i) written notice of such assignment and delegation, together
with payment instructions, addresses and related information with
respect to such Assignee Lender, shall have been given to the Borrower
and the Agent by such Lender and such Assignee Lender,
(ii) such Assignee Lender shall have executed and delivered to
the Borrower and the Agent a Lender Assignment Agreement, accepted by
the Agent, and
(iii) the processing fees described below shall have been paid.
From and after the date that the Agent accepts such Lender Assignment Agreement,
(x) the Assignee Lender thereunder shall be deemed automatically to have become
a party hereto and to the
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<PAGE> 86
extent that rights and obligations hereunder have been assigned and delegated to
such Assignee Lender in connection with such Lender Assignment Agreement, shall
have the rights and obligations of a Lender hereunder and under the other Loan
Documents, and (y) the assignor Lender, to the extent that rights and
obligations hereunder have been assigned and delegated by it in connection with
such Lender Assignment Agreement, shall be released from its obligations
hereunder and under the other Loan Documents with respect to obligations arising
after the date of assignment. Within five Business Days after its receipt of
notice that the Agent has received an executed Lender Assignment Agreement, the
Borrower shall execute and deliver to the Agent (for delivery to the relevant
Assignee Lender) new Notes evidencing such Assignee Lender's assigned Loans and
Commitments and, if the assignor Lender has retained Loans and Commitments
hereunder, replacement Notes in the principal amount of the Loans and
Commitments retained by the assignor Lender hereunder (such Notes to be in
exchange for, but not in payment of, those Notes then held by such assignor
Lender). Each such Note shall be dated the date of the predecessor Notes. The
assignor Lender shall mark the predecessor Notes "exchanged" and deliver them to
the Borrower. Accrued interest on that part of the predecessor Notes evidenced
by the new Notes, and accrued fees, shall be paid as provided in the Lender
Assignment Agreement. Accrued interest on that part of the predecessor Notes
evidenced by the replacement Notes shall be paid to the assignor Lender. Accrued
interest and accrued fees shall be paid at the same time or times provided in
the predecessor Notes and in this Agreement. Such assignor Lender or such
Assignee Lender must also pay a processing fee to the Agent upon delivery of any
Lender Assignment Agreement in the amount of $3,000. Any attempted assignment
and delegation not made in accordance with this Section 11.11.1 shall be null
and void. In addition to the foregoing, and notwithstanding any other provision
hereof, (i) any Lender may at any time assign its rights under this Agreement to
any Federal Reserve Bank and (ii) Scotiabank shall provide notice to the Lenders
of any assignments by it under this Section 11.11.1.
SECTION 11.11.2. Participations. Any Lender may, with the written
consent of the Borrower (which consent shall not be unreasonably withheld and
which consent shall be deemed to have been given in the absence of a written
notice delivered by the
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<PAGE> 87
Borrower to such Lender, on or before the tenth Business Day after receipt by
the Borrower of such Lender's request for consent, stating, in reasonable
detail, the reasons why the Borrower proposes to withhold such consent) and the
Agent at any time sell to one or more commercial banks or other Persons (each of
such commercial banks and other Persons being herein called a "Participant")
participating interests in any of the Loans, Commitments, or other interests of
such Lender hereunder; provided, however, that
(a) no participation or sub-participation contemplated in this
Section 11.11 shall relieve such Lender from its Commitments or its
other obligations hereunder or under any other Loan Document,
(b) such Lender shall remain solely responsible for the
performance of its Commitments and such other obligations,
(c) the Borrower and each other Obligor and the Agent shall
continue to deal solely and directly with such Lender in connection with
such Lender's rights and obligations under this Agreement and each of
the other Loan Documents,
(d) no Participant, unless such Participant is an Affiliate of
such Lender, or is itself a Lender, shall be entitled to require such
Lender to take or refrain from taking any action hereunder or under any
other Loan Document, except that such Lender may agree with any
Participant that such Lender will not, without such Participant's
consent, take any actions of the type described in clause (b) or (c) of
Section 11.1, and
(e) the Borrower shall not be required to pay any amount under
Section 5.6 that is greater than the amount which it would have been
required to pay had no participating interest been sold.
The Borrower acknowledges and agrees that each Participant, for purposes of
Sections 5.3, 5.4, 5.5, 5.6, 5.8, 5.9, 11.3 and 11.4, shall be considered a
Lender.
SECTION 11.12. Other Transactions. Nothing contained
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<PAGE> 88
herein shall preclude the Agent or any other Lender from engaging in any
transaction, in addition to those contemplated by this Agreement or any other
Loan Document, with the Borrower or any of its Affiliates in which the Borrower
or such Affiliate is not restricted hereby from engaging with any other Person.
SECTION 11.13. Forum Selection and Consent to Jurisdiction. ANY
LITIGATION BASED HEREON, OR ARISING OUT OF, UNDER, OR IN CONNECTION WITH, THIS
AGREEMENT OR ANY OTHER LOAN DOCUMENT, OR ANY COURSE OF CONDUCT, COURSE OF
DEALING, STATEMENTS (WHETHER VERBAL OR WRITTEN) OR ACTIONS OF THE AGENT, THE
LENDERS OR THE BORROWER SHALL BE BROUGHT AND MAINTAINED EXCLUSIVELY IN THE
COURTS OF THE STATE OF NEW YORK OR IN THE UNITED STATES DISTRICT COURT FOR THE
SOUTHERN DISTRICT OF NEW YORK; PROVIDED, HOWEVER, THAT ANY SUIT SEEKING
ENFORCEMENT AGAINST ANY COLLATERAL OR OTHER PROPERTY MAY BE BROUGHT, AT THE
AGENT'S OPTION, IN THE COURTS OF ANY JURISDICTION WHERE SUCH COLLATERAL OR OTHER
PROPERTY MAY BE FOUND. THE BORROWER HEREBY EXPRESSLY AND IRREVOCABLY SUBMITS TO
THE JURISDICTION OF THE COURTS OF THE STATE OF NEW YORK AND OF THE UNITED STATES
DISTRICT COURT FOR THE SOUTHERN DISTRICT OF NEW YORK FOR THE PURPOSE OF ANY SUCH
LITIGATION AS SET FORTH ABOVE AND IRREVOCABLY AGREES TO BE BOUND BY ANY JUDGMENT
RENDERED THEREBY IN CONNECTION WITH SUCH LITIGATION. THE BORROWER FURTHER
IRREVOCABLY CONSENTS TO THE SERVICE OF PROCESS BY PERSONAL SERVICE WITHIN OR
WITHOUT THE STATE OF NEW YORK OR IN ANY MANNER PROVIDED BY LAW. THE BORROWER
HEREBY EXPRESSLY AND IRREVOCABLY WAIVES, TO THE FULLEST EXTENT PERMITTED BY LAW,
ANY OBJECTION WHICH IT MAY HAVE OR HEREAFTER MAY HAVE TO THE LAYING OF VENUE OF
ANY SUCH LITIGATION BROUGHT IN ANY SUCH COURT REFERRED TO ABOVE AND ANY CLAIM
THAT ANY SUCH LITIGATION HAS BEEN BROUGHT IN AN INCONVENIENT FORUM. TO THE
EXTENT THAT THE BORROWER HAS OR HEREAFTER MAY ACQUIRE ANY IMMUNITY FROM
JURISDICTION OF ANY COURT OR FROM ANY LEGAL PROCESS (WHETHER THROUGH SERVICE OR
NOTICE, ATTACHMENT PRIOR TO JUDGMENT, ATTACHMENT IN AID OF EXECUTION OR
OTHERWISE) WITH RESPECT TO ITSELF OR ITS PROPERTY, THE BORROWER HEREBY
IRREVOCABLY WAIVES SUCH IMMUNITY IN RESPECT OF ITS OBLIGATIONS UNDER THIS
AGREEMENT AND THE OTHER LOAN DOCUMENTS.
SECTION 11.14. Waiver of Jury Trial. THE AGENT, THE LENDERS AND THE
BORROWER HEREBY KNOWINGLY, VOLUNTARILY AND INTENTIONALLY WAIVE ANY RIGHTS THEY
MAY HAVE TO A TRIAL BY JURY IN RESPECT OF ANY LITIGATION AMONG ANY OF THE AGENT,
THE LENDERS
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AND THE BORROWER BASED HEREON, OR ARISING OUT OF, UNDER, OR IN CONNECTION WITH,
THIS AGREEMENT OR ANY OTHER LOAN DOCUMENT, OR ANY COURSE OF CONDUCT, COURSE OF
DEALING, STATEMENTS (WHETHER VERBAL OR WRITTEN) OR ACTIONS OF THE AGENT, THE
LENDERS OR THE BORROWER. THE BORROWER ACKNOWLEDGES AND AGREES THAT IT HAS
RECEIVED FULL AND SUFFICIENT CONSIDERATION FOR THIS PROVISION (AND EACH OTHER
PROVISION OF EACH OTHER LOAN DOCUMENT TO WHICH IT IS A PARTY) AND THAT THIS
PROVISION IS A MATERIAL INDUCEMENT FOR THE AGENT AND THE LENDERS ENTERING INTO
THIS AGREEMENT AND EACH SUCH OTHER LOAN DOCUMENT.
SECTION 11.15. Confidentiality. The Lenders shall hold all non-public
information (which has been identified as such by the Borrower) obtained
pursuant to the requirements of this Agreement in accordance with their
customary procedures for handling confidential information of this nature and in
accordance with safe and sound banking practices and in any event may make
disclosure to any of their examiners, their Affiliates, outside auditors,
counsel and other professional advisors in connection with this Agreement or as
reasonably required by any bona fide transferee, participant or assignee or as
required or requested by any governmental agency or representative thereof or
pursuant to legal process; provided, however, that
(a) unless specifically prohibited by applicable law or court
order, each Lender shall notify the Borrower of any request by any
governmental agency or representative thereof (other than any such
request in connection with an examination of the financial condition of
such Lender by such governmental agency) for disclosure of any such
non-public information prior to disclosure of such information;
(b) prior to any such disclosure pursuant to this Section 11.15,
each Lender shall require any such bona fide transferee, participant and
assignee receiving a disclosure of non-public information to agree in
writing
(i) to be bound by this Section 11.15;
(ii) to require such Person to require any other Person to
whom such Person discloses such non-public information to be
similarly bound by this
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Section 11.15; and
(c) except as may be required by an order of a court of competent
jurisdiction and to the extent set forth therein, no Lender shall be
obligated or required to return any materials furnished by the Borrower
or any Subsidiary.
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<PAGE> 91
IN WITNESS WHEREOF, the parties hereto have caused this Agreement to be
executed by their respective officers thereunto duly authorized as of the day
and year first above written.
CALPINE CORPORATION
By: ____________________________________
Name: Michael Thomas
Title:
Address: 50 West San Fernando Avenue
San Jose, CA 95113
Facsimile No.: (408) 995-0505
Attention: Senior Vice President-Finance
S-1
<PAGE> 92
THE BANK OF NOVA SCOTIA,
as Agent
By:_______________________________
Name:
Title:
Address: 580 California Street
Suite 2100
San Francisco, CA 94111
Facsimile No.: (415) 397-0791
Attention: Jon Burckin
with a copy to:
The Bank of Nova Scotia
600 Peachtree Street N.E.
Suite 2700
Atlanta, GA 30308
Attention: Eudia Smith
Administrative Agent -
Loan Administration
Facsimile No.: (404) 888-8998
S-2
<PAGE> 93
PERCENTAGE LENDERS
THE BANK OF NOVA SCOTIA
33.34%
By:________________________________
Name:
Title:
Address: 580 California Street
Suite 2100
San Francisco, CA 94104
Facsimile No.: (415) 397-0791
Attention: Jon Burckin
with a copy to:
The Bank of Nova Scotia
600 Peachtree Street N.E.
Suite 2700
Atlanta, GA 30308
Attention: Eudia Smith
Administrative Agent -
Loan Administration
Facsimile No.: (404) 888-8998
Domestic and LIBOR Office:
580 California Street
Suite 2100
San Francisco, CA 94104
Facsimile No.: (415) 397-0791
Attention: Jon Burckin
S-3
<PAGE> 94
CREDIT SUISSE FIRST BOSTON
33.33%
By:_____________________________________
Name:
Title:
By:_____________________________________
Name:
Title:
Address: 5 World Trade Center
New York, New York 10048
ATTN: Jenaro Sarasola
Phone: 212-322-1384
Fax: 212-335-0593
With a copy to:
11 Madison Avenue
New York, New York 10010
ATTN: James Moran
Phone: 212-325-9176
Fax: 212-325-8615
Domestic and LIBOR Office:
5 World Trade Center
New York, New York 10048
ATTN: Jenaro Sarasola
Phone: 212-322-1384
Fax: 212-335-0593
S-4
<PAGE> 95
CANADIAN IMPERIAL BANK OF COMMERCE
33.33%
By:_____________________________________
Name:
Title:
Address: 425 Lexington Avenue
New York, New York 10017
Facsimile No.: (212) 885-4911
Attention: Sanjeeva Senanayake
with a copy to:
CIBC INC.
2727 Paces Ferry Road
Atlanta, Georgia 30339
Attention: Miriam McCart
Facsimile No.: (770) 319-4950
Domestic and LIBOR Office:
CIBC INC.
2727 Paces Ferry Road
Atlanta, Georgia 30339
Attention: Miriam McCart
Facsimile No.: (770) 319-4950
S-5
<PAGE> 96
SCHEDULE 1
DISCLOSURE SCHEDULE
ITEM 7.7 Litigation.
On September 30, 1997, a lawsuit was filed by Indeck North American Power Fund
("Indeck") in the Circuit Court of Cook County, Illinois against Norweb plc. and
certain other parties, including the Borrower. Some of Indeck's claims relate to
Calpine Gordonsville, Inc.'s acquisition of a 50% interest in Gordonsville
Energy L.P. from Northern Hydro Limited and Calpine Auburndale, Inc.'s
acquisition of a 50% interest in Auburndale Power Plant Partners Limited
Partnership from Norweb Power Services (No. 1) Limited. Indeck claimed that
Calpine Gordonsville, Inc., Calpine Auburndale, Inc. and the Borrower tortuously
interfered with Indeck's contractual rights to purchase such interests and
conspired with other parties to do so. Indeck is seeking $25.0 million in
compensatory damages, $25.0 million in punitive damages, and the recovery of
attorneys' fees and costs. In April 1999, the court dismissed the claims against
Calpine Auburndale and Calpine Gordonsville with prejudice. Indeck appealed the
court's decision. The outcome of the appeal is not expected until late 2000. The
Borrower is unable to predict the outcome of these proceedings but it does not
expect that the outcome of these proceedings will have a material adverse effect
on its financial position or results of operations.
The Borrower and its affiliates are involved in various other claims and legal
actions arising out of the normal course of business. The Borrower does not
expect that the outcome of these proceedings will have a material adverse effect
on the Borrower's financial position or results of operations, although no
assurance can be given in this regard.
ITEM 7.8 Existing Significant Subsidiaries.
State of Ownership Business
Name Incorporation % Description
---- ------------- --------- -----------
Geysers Power Company, LLC
Calpine Eastern Corporation
Calpine Finance Company
Calpine Cogeneration Corporation
Calpine Construction Finance Company, L.P.
ITEM 7.11 Employee Benefit Plans.
<PAGE> 97
None
ITEM 7.12 Environmental Matters.
None
ITEM 8.2.2(a) Ongoing Indebtedness.
<TABLE>
<CAPTION>
Creditor Outstanding Principal Amount
-------- ----------------------------
<S> <C> <C>
9 1/4% Senior Notes Due 2004 $105,000,000.00
10 1/2% Senior Notes Due 2006 $180,000,000.00
7 7/8% Senior Notes Due 2008 $400,000,000.00
8 3/4% Senior Notes Due 2007 $275,000,000.00
7 5/8% Senior Notes Due 2006 $250,000,000.00
7 3/4% Senior Notes Due 2009 $350,000,000.00
Second Amended and Restated
Credit Agreement dated 5/23/00 $400,000,000.00
</TABLE>
ITEM 8.2.5(a) Ongoing Investments.
See attached pages.
<PAGE> 98
SCHEDULE 8.2.5(a)
Any Investment of the Borrower or any of its Subsidiaries existing on the
Effective Date in respect of, or relating to, any of the operating power plants,
pending power plant acquisitions, development projects and operating steam
fields described below, [and any other operating power plants, pending power
plant acquisitions, development projects, operating steam fields, reserves of
geothermal steam and fluid, natural gas reserves or other assets within the
scope of the Borrower's or any of its Subsidiaries' existing business in
existence as of the Effective Date].
POWER PLANTS
<TABLE>
<CAPTION>
COMMENCEMENT TERM OF
POWER NAMEPLATE CALPINE CALPINE NET OF POWER
GENERATION CAPACITY INTEREST INTEREST COMMERCIAL POWER SALES
POWER PLANT TECHNOLOGY (MEGAWATTS) (1) PERCENTAGE (MEGAWATTS) OPERATION PURCHASERS AGREEMENT
----------- ---------- --------------- ---------- ----------- --------- ---------- ---------
<S> <C> <C> <C> <C> <C> <C> <C>
OPERATING POWER
PLANTS
Texas City............ Gas-Fired 450 100% 450 1987 TUEC 2002
UCC (2) 2003
Clear Lake............ Gas-Fired 377 100% 377 1984 TNP 2004
HL&P 2005
Bayonne............... Gas-Fired 165 7.06% 11.6 1988 JCPL 2008
PSEG (14) 2008
Gordonsville.......... Gas-Fired 240 50% 120 1994 VEPCO (4) 2004
Lockport.............. Gas-Fired 184 11.36% 20.9 1992 GM 2007
NYSEG (5)
Auburndale............ Gas-Fired 150 50% 75 1994 Florida Power 2013
Company
Sumas................. Gas-Fired 125 70% 87.5 1993 Puget Sound 2013
Power & Light
King City............. Gas-Fired 120 100% 120 1989 Pacific Gas & 2019
Electric ("PG&E")
Gilroy................ Gas-Fired 120 100% 120 1988 PG&E 2018
Kennedy
International Airport. Gas-Fired 107 50% 53.5 1995 Port Authority (7) 2015
Bethpage.............. Gas-Fired 57 100% 57 1989 NG Corp. (8) 2004
Greenleaf 1........... Gas-Fired 49.5 100% 49.5 1989 PG&E 2019
Greenleaf 2........... Gas-Fired 49.5 100% 49.5 1989 PG&E 2019
Stony Brook........... Gas-Fired 40 50% 20 1995 SUNY 2015
LILCo (9)
Agnews................ Gas-Fired 29 20% 5.8 1990 PG&E 2021
Watsonville........... Gas-Fired 28.5 100% 28.5 1990 PG&E 2009
West Ford Flat........ Geothermal 27 100% 27 1988 PG&E 2008
</TABLE>
<PAGE> 99
<TABLE>
<S> <C> <C> <C> <C> <C> <C> <C>
Bear Canyon........... Geothermal 20 100% 20 1988 PG&E 2008
Aidlin................ Geothermal 20 5% 1 1989 PG&E 2009
PENDING ACQUISITION
Pittsburg............. Gas-Fired 70 100% 70 1966 Dow Chemical n/a
Corporation
PROJECTS UNDER CONSTRUCTION
Pasadena (10)......... Gas-Fired 240 100% 240 1998 Phillips Petroleum 2018
Company (10)
Dighton (11).......... Gas-Fired 169 50% 84.5 1999 Merchant n/a
</TABLE>
STEAM FIELDS
<TABLE>
<CAPTION>
APPROPRIATE CALPINE CALPINE NET COMMENCEMENT
CAPACITY INTEREST INTEREST OF COMMERCIAL UTILITY ESTIMATED
STEAM FIELD (MEGAWATTS) (12) PERCENTAGE (MEGAWATTS) OPERATION PURCHASER LIFE (13)
----------- ---------------- ---------- ----------- ------------- ----------------- ---------
<S> <C> <C> <C> <C> <C> <C>
Thermal Power Company........ 140 100% 140 1960 PG&E 2018
PG&E Unit 13................. 75 100% 75 1980 PG&E 2018
PG&E Unit 16................. 74 100% 74 1985 PG&E 2018
SMUDGEO #1................... 50 100% 50 1983 Sacramento 2018
Municipal Utility
District
Cerro Prieto................. 80 100%(14) 80 1973 Comision 2000 (15)
Federal de
Electricidad
</TABLE>
--------------------
(1) Nameplate capacity may not represent the actual output for a facility at
any particular time.
(2) The power purchasers for the Texas City Power Plant are the Texas
Utilities Electric Company ("TUEC") and the Union Carbide Corporation
("UCC").
(3) The power purchasers for the Clear Lake Power Plant are the Texas-New
Mexico Power Company ("TNP"), the Houston Lighting and Power Company
("HL&P") and the Hoechst Celanese Chemical Group, Inc. ("HCCG").
(4) The power purchaser for the Gordonsville Power Plant is Virginia
Electric and Power Company ("VEPCO").
(5) The power purchasers for the Lockport Power Plant are General Motors
("GM") and New York State Electric and Gas ("NYSEG").
(7) Electricity generated by the Kennedy International Airport Power Plant
is sold to the Port Authority of New York and New Jersey ("Port
Authority") and excess energy is sold to other utility customers.
(8) Electricity generated by the Bethpage Power Plant is sold to the
Northrup Grumman Corporation ("NG Corp."), and excess energy is sold to
Long Island Lighting Corporation ("LILCo").
(9) Electricity generated by the Stony Brook Power Plant is sold to the
State University of New York at Stony Brook ("SUNY") and excess energy
is sold to LILCo.
<PAGE> 100
(10) The Pasadena Power Plant is currently under construction and is expected
to commence commercial operation in July 1998. Approximately 90
megawatts will be sold to Phillips Petroleum Company, with the remaining
available electricity generated to be sold into the open market.
(11) The Dighton Power Plant is currently under construction and is expected
to commence commercial operation in early 1999. The Company invested
$16.0 million in the facility, which entitles the Company to receive a
preferred payment stream at a rate of 12.07% per annum on its
investment. Based on the Company's current estimates, this preferred
payment stream will represent approximately 50% of project cash flow
beginning at the commencement of commercial operation. A merchant plant
is a power generation facility that sells all or a portion of its
electricity into the competitive market rather than pursuant to long-
term power sales agreements.
(12) Capacity is expected to gradually diminish as the production of the
related steam fields declines.
(13) Other than the Cerro Prieto Steam Field, the stream sales agreements
remain in effect so long as steam is produced in commercial quantities.
There can be no assurance that the estimated life shown accurately
predicts actual productive capacity of the steam fields.
(14) The power purchasers for the Bayonne Power Plant are Public Service
Electric & Gas Company and Jersey Central Power & Light Company.
<PAGE> 101
SCHEDULE 8.2.5(a)
ONGOING INVESTMENTS
POWER GENERATION FACILITIES
Lake County
Wastewater Pipeline: An approximate $3.75 million investment to be
made in 1996 and 1997 to augment steam
generation. Calpine is partners in this project
with PG&E, Union Oil Company of California,
Northern California Power Association, Lake
County Sanitation District, among others.
<PAGE> 102
EXHIBIT A
NOTE
$ June 23, 2000
-----------
FOR VALUE RECEIVED, the undersigned, CALPINE CORPORATION, a Delaware
corporation (the "Borrower"), promises to pay to the order of
____________________ (the "Lender") on the Commitment Termination Date, the
principal sum of _________________ DOLLARS ($ ________) or, if less, the
aggregate unpaid principal amount of all Loans made by the Lender pursuant to
that certain Bridge Credit Agreement, dated as of June 23, 2000 (together with
all amendments and other modifications, if any, from time to time thereafter
made thereto, the "Credit Agreement"), among the Borrower, THE BANK OF NOVA
SCOTIA, as Agent, and the various financial institutions (including the Lender)
as are, or may from time to time become, parties thereto.
The Borrower also promises to pay interest on the unpaid principal
amount hereof from time to time outstanding from the date hereof until maturity
(whether by acceleration or otherwise) and, after maturity, until paid, at the
rates per annum and on the dates specified in the Credit Agreement.
Payments of both principal and interest are to be made in lawful money
of the United States of America in same day or immedi ately available funds to
the account designated by the Agent pursuant to the Credit Agreement.
This Note is one of the Notes referred to in, and evidences Indebtedness
incurred under, the Credit Agreement, to which reference is made for a
description of the security for this Note and for a statement of the terms and
conditions on which the Borrower is permitted and required to make prepayments
and repayments of principal of the Indebtedness evidenced by this Note and on
which such Indebtedness may be declared to be immediately due and payable.
Unless otherwise defined, terms used herein have the meanings provided in the
Credit Agreement.
All parties hereto, whether as makers, endorsers, or
<PAGE> 103
otherwise, severally waive presentment for payment, demand, protest and notice
of dishonor.
THIS NOTE SHALL BE DEEMED TO BE MADE UNDER AND GOVERNED BY THE INTERNAL
LAWS OF THE STATE OF NEW YORK.
CALPINE CORPORATION
By ____________________________
Name:
Title:
<PAGE> 104
LOANS AND PRINCIPAL PAYMENTS
<TABLE>
<CAPTION>
=================================================================================================================================
Amount of Interest Amount of Principal Unpaid Principal
Loan Made Period Repaid Balance
--------------------- ------------------- -----------------
Base LIBO (If Base LIBO Base LIBO Notation
Date Rate Rate Applicable) Rate Rate Rate Rate Total Made By
=================================================================================================================================
<S> <C> <C> <C> <C> <C> <C> <C> <C> <C>
---------------------------------------------------------------------------------------------------------------------------------
---------------------------------------------------------------------------------------------------------------------------------
---------------------------------------------------------------------------------------------------------------------------------
---------------------------------------------------------------------------------------------------------------------------------
---------------------------------------------------------------------------------------------------------------------------------
---------------------------------------------------------------------------------------------------------------------------------
---------------------------------------------------------------------------------------------------------------------------------
---------------------------------------------------------------------------------------------------------------------------------
---------------------------------------------------------------------------------------------------------------------------------
---------------------------------------------------------------------------------------------------------------------------------
=================================================================================================================================
</TABLE>
<PAGE> 105
EXHIBIT B
BORROWING REQUEST
The Bank of Nova Scotia
600 Peachtree Street N.E.
Suite 2700
Atlanta, GA 30308
Attention: Ms. Eudia Smith
CALPINE CORPORATION
Gentlemen and Ladies:
This Borrowing Request is delivered to you pursuant to Section 2.3 of
the Bridge Credit Agreement, dated as of June 23, 2000 (together with all
amendments, if any, from time to time made thereto, the "Credit Agreement"),
among Calpine Corporation, a Delaware corporation (the "Borrower"), certain
financial institutions and The Bank of Nova Scotia, as agent (the "Agent").
Unless otherwise defined herein or the context otherwise requires, terms used
herein have the meanings provided in the Credit Agreement.
The Borrower hereby requests that a Loan be made in the aggregate
principal amount of $__________ on __________, ____ as a [LIBO Rate Loan having
an Interest Period of ______ months] [Base Rate Loan].
The Borrower hereby further certifies that its incurrence of the
Indebtedness evidenced by the Loans is permitted under the terms of the Senior
Note Indentures pursuant to Section 3.4[__] thereof. If the Borrower is relying
on clause (a) of Section 3.4 of the Senior Note Indentures, the Borrower has
attached hereto a certificate demonstrating its compliance with the incurrence
test set forth therein.
The Borrower hereby acknowledges that, pursuant to Section 6.2.2 of the
Credit Agreement, each of the delivery of this Borrowing Request and the
acceptance by the Borrower of the proceeds of the Loans requested hereby
constitute a representation and warranty by the Borrower that, on the date of
<PAGE> 106
such Loans, and before and after giving effect thereto and to the application of
the proceeds therefrom, all statements set forth in Section 6.2.1 are true and
correct in all material respects.
The Borrower agrees that if prior to the time of the Borrowing requested
hereby any matter certified to herein by it will not be true and correct at such
time as if then made, it will immediately so notify the Agent. Except to the
extent, if any, that prior to the time of the Borrowing requested hereby the
Agent shall receive written notice to the contrary from the Borrower, each
matter certified to herein shall be deemed once again to be certified as true
and correct at the date of such Borrowing as if then made.
Please wire transfer the proceeds of the Borrowing to the accounts of
the following persons at the financial institutions indicated respectively:
<TABLE>
<CAPTION>
Amount to be Person to be Paid Name, Address, etc.
Transferred Name Account No. of Transferred Lender
<S> <C> <C> <C>
$__________ __________ ___________ _____________________
_____________________
Attention: _____________________
$__________ __________ ___________ _____________________
_____________________
Attention: _____________________
Balance of The Borrower ___________ _____________________
such proceeds _____________________
Attention: _____________________
</TABLE>
The Borrower has caused this Borrowing Request to be executed and
delivered, and the certification and warranties contained herein to be made, by
its duly Authorized Officer this ____ day of ___________, _______ .
CALPINE CORPORATION
By __________________________________
Name:
Title:
<PAGE> 107
EXHIBIT C
CONTINUATION/CONVERSION NOTICE
The Bank of Nova Scotia
600 Peachtree Street N.E.
Suite 2700
Atlanta, GA 30308
Attention: Ms. Eudia Smith
CALPINE CORPORATION
Gentlemen and Ladies:
This Continuation/Conversion Notice is delivered to you pursuant to
Section 2.4 of the Bridge Credit Agreement, dated as of June 23, 2000 (together
with all amendments, if any, from time to time made thereto, the "Credit
Agreement"), among Calpine Corporation, a Delaware corporation (the "Borrower"),
certain financial institutions and The Bank Of Nova Scotia, as agent (the
"Agent"). Unless otherwise defined herein or the context otherwise requires,
terms used herein have the meanings provided in the Credit Agreement.
The Borrower hereby requests that on ______________, 200_,
(1) $_________ of the presently outstanding principal amount of
the Loans originally made on _________ , 200_ [and $_________ of the
presently outstanding principal amount of the Loans originally made on
_________ , 200_],
(2) and all presently being maintained as */[Base Rate Loans]
[LIBO Rate Loans],
(3) be [converted into] [continued as],
------------
*/ Select appropriate interest rate option.
**/ Insert appropriate interest rate option.
<PAGE> 108
(4) **/ [LIBO Rate Loans having an Interest Period of _________
months] [Base Rate Loans].
The Borrower hereby:
(a) certifies and warrants that no Default has occurred and is
continuing; and
(b) agrees that if prior to the time of such continuation or
conversion any matter certified to herein by it will not be true and
correct at such time as if then made, it will immediately so notify the
Agent.
Except to the extent, if any, that prior to the time of the continuation or
conversion requested hereby the Agent shall receive written notice to the
contrary from the Borrower, each matter certified to herein shall be deemed to
be certified at the date of such continuation or conversion as if then made.
The Borrower has caused this Continuation/Conversion Notice to be
executed and delivered, and the certification and warranties contained herein to
be made, by its Authorized Officer this day of , 200_.
CALPINE CORPORATION
By __________________________________
Name:
Title:
------------
**/ Insert appropriate interest rate option.
<PAGE> 109
EXHIBIT D
LENDER ASSIGNMENT AGREEMENT
To: Calpine Corporation
To: The Bank of Nova Scotia,
as the Agent
CALPINE CORPORATION
Gentlemen and Ladies:
We refer to clause (d) of Section 11.11.1 of the Bridge Credit
Agreement, dated as of June 23, 2000 (together with all amendments and other
modifications, if any, from time to time thereafter made thereto, the "Credit
Agreement"), among Calpine Corporation, a Delaware corporation (the "Borrower"),
the various financial institutions (the "Lenders") as are, or shall from time to
time become, parties thereto, and The Bank of Nova Scotia, as agent (the
"Agent") for the Lenders. Unless otherwise defined herein or the context
otherwise requires, terms used herein have the meanings provided in the Credit
Agreement.
This agreement is delivered to you pursuant to clause (d) of Section
11.11.1 of the Credit Agreement and also constitutes notice to each of you,
pursuant to clause (c) of Section 11.11.1 of the Credit Agreement, of the
assignment and delegation to _______________ (the "Assignee") of ___% of the
Loans and Commitments of _____________ (the "Assignor") outstanding under the
Credit Agreement on the date hereof. After giving effect to the foregoing
assignment and delegation, the Assignor's and the Assignee's Percentages for the
purposes of the Credit Agreement are set forth opposite such Person's name on
the signature pages hereof.
[Add paragraph dealing with accrued interest and fees with respect to
Loans assigned.]
<PAGE> 110
The Assignee hereby acknowledges and confirms that it has received a
copy of the Credit Agreement and the exhibits related thereto, together with
copies of the documents which were required to be delivered under the Credit
Agreement as a condition to the making of the Credit Extensions thereunder. The
Assignee further confirms and agrees that in becoming a Lender and in making its
Commitments and Loans under the Credit Agreement, such actions have and will be
made without recourse to, or representation or warranty by the Agent.
Except as otherwise provided in the Credit Agreement, effective as of
the date of acceptance hereof by the Agent
(a) the Assignee
(i) shall be deemed automatically to have become a party to
the Credit Agreement, have all the rights and obligations of a
"Lender" under the Credit Agreement and the other Loan Documents
as if it were an original signatory thereto to the extent
specified in the second paragraph hereof; and
(ii) agrees to be bound by the terms and conditions set forth
in the Credit Agreement and the other Loan Documents as if it
were an original signatory thereto; and
(b) the Assignor shall be released from its obligations under the
Credit Agreement and the other Loan Documents to the extent specified in
the second paragraph hereof with respect to obligations arising after
the effective date of this assignment.
The Assignor and the Assignee hereby agree that the [Assignor]
[Assignee] will pay to the Agent the processing fee referred to in Section
11.11.1 of the Credit Agreement upon the delivery hereof.
The Assignee hereby advises each of you of the following administrative
details with respect to the assigned Loans and Commitments and requests the
Agent to acknowledge receipt of this document:
<PAGE> 111
(A) Address for Notices:
Institution Name:
Attention:
Domestic Office:
Telephone:
Facsimile:
LIBOR Office:
Telephone:
Facsimile:
(B) Payment Instructions:
The Assignee agrees to furnish the tax form required by the last
sentence of Section 5.6 (if so required) of the Credit Agreement no later than
the date of acceptance hereof by the Agent.
This Agreement may be executed by the Assignor and Assignee in separate
counterparts, each of which when so executed and delivered shall be deemed to be
an original and all of which taken together shall constitute one and the same
agreement.
Adjusted Percentage [ASSIGNOR]
Loan Commitment
and Loans: __%
By:_______________________
Title:
Percentage [ASSIGNEE]
Loan Commitment
and Loans: __%
By:_______________________
Title:
<PAGE> 112
Accepted and Acknowledged
this ______ day of _________, 200_
The Bank of Nova Scotia,
as Agent
By:________________________
Title:
Consented to and acknowledged
this _____ day of __________, 200_
Calpine Corporation
By:________________________
Title:
<PAGE> 113
EXHIBIT E
[Opinions of Counsel to the Borrower]
<PAGE> 114
EXHIBIT F
June 23, 2000
To the Agent and Banks party to
the hereinafter described
Credit Agreement
Re: Calpine Corporation
Gentlemen:
We have participated in the preparation of the Bridge Credit Agreement
dated as of June 23, 2000 (the "Credit Agreement") among Calpine Corporation
("Borrower"), the banks listed on the signature pages thereof (the "Banks") and
The Bank of Nova Scotia, as agent (the "Agent"), and have acted as special
counsel for the Agent for purposes of rendering this opinion. Terms defined in
the Credit Agreement are used herein as therein defined.
We have examined originals or copies, certified to our satisfaction, of
such documents, corporate records, certificates of public officials and other
instruments and have conducted such other investigations of fact and law as we
have deemed necessary or advisable for purposes of this opinion.
Upon the basis of the foregoing, we are of the opinion that the
documents delivered to the Agent by the Borrower pursuant to Sections 6.1.1
through 6.1.3 of the Credit Agreement are substantially responsive to the
requirements of said Sections and the delivery of such documents satisfies the
conditions precedent set forth therein.
We are members of the Bar of the State of California, and the foregoing
opinion is limited to the laws of the State of California and the federal laws
of the United States of America.
This opinion is rendered solely to you in connection with the above
matter. This opinion may not be relied upon by you for any other purpose or
relied upon by or furnished to any other
<PAGE> 115
To the Agent and Banks party to
the hereinafter described
Credit Agreement
June 23, 2000
Page 117
person without our prior written consent.
Very truly yours,
MAYER, BROWN & PLATT
By__________________________
Its Partner
