Exhibit 10.1
EXECUTION COPY
_____________________________________________________________________________
CREDIT AGREEMENT
Dated as of July 21, 2005
Among
ALLEGHENY ENERGY SUPPLY COMPANY, LLC,
THE OTHER PERSONS REFERRED TO HEREIN AS LOAN PARTIES,
EACH OF THE LENDERS,
CITICORP NORTH AMERICA, INC.,
as Administrative Agent,
and
CITIBANK, N.A.,
as Collateral Agent and Intercreditor Agent
_______________________________________________________________________
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_________________________________________________________________________________________________________
|
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| CITIGROUP GLOBAL MARKETS INC., |
BANC OF AMERICA SECURITIES LLC,| CREDIT SUISSE, CAYMAN ISLANDS
BRANCH,|
| Sole Lead Arranger and Joint | Syndication
Agent and |
Documentation Agent and Joint |
|
Book Runner
|
Joint Book Runner
|
Book Runner
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|_________________________________|________________________________|______________________________________|
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TABLE OF CONTENTS
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Page
ARTICLE I
DEFINITIONS AND INTERPRETATION
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Section 1.01
Definitions......................................................................2
Section 1.02 Principles
of
Interpretation....................................................35
Section 1.03
Determination of Material Adverse Change and Material Adverse
Effect, Etc.......37
ARTICLE II
ADVANCES AND PAYMENTS
Section 2.01 The
Borrowings..................................................................37
Section 2.02 Making the
Borrowings...........................................................37
Section 2.03 Interest
Elections..............................................................39
Section 2.04
Termination or Reduction of
Commitments.........................................40
(a)
Mandatory..............................................................40
(b)
Optional...............................................................40
Section 2.05 Repayment
of
Advances...........................................................40
Section 2.06
Prepayments.....................................................................41
(a)
Optional...............................................................41
(b)
Mandatory..............................................................42
(c)
Application of Prepayment
Amounts......................................43
(d)
Prepayments
Generally..................................................44
Section 2.07
Interest........................................................................44
(a) Scheduled
Interest.....................................................44
(b) Default
Interest.......................................................45
(c) Notice of
Interest Period and Interest Rate............................45
Section 2.08
Fees............................................................................45
Section 2.09 Payments
Generally; Pro Rata
Treatment..........................................45
Section 2.10
Illegality......................................................................47
Section 2.11 Increased
Costs.................................................................48
Section 2.12
Taxes...........................................................................49
Section 2.13 Evidence
of
Debt................................................................52
Section 2.14 Request
for
Commitments.........................................................52
Section 2.15 Use of
Proceeds.................................................................54
ARTICLE III
CONDITIONS OF EFFECTIVENESS
Section 3.01 Conditions
Precedent to Closing
Date............................................55
Section 3.02 Conditions
Precedent to Second Draw
Date........................................60
Section 3.03
Determinations Under Section 3.01 and Section
3.02..............................61
ARTICLE IV
REPRESENTATIONS AND WARRANTIES
Section 4.01
Representations and Warranties of the
Borrower..................................61
Section 4.02
Representations and Warranties of the Other Loan
Parties........................68
ARTICLE V
COVENANTS
Section 5.01
Affirmative Covenants of the
Borrower...........................................70
(a) Compliance
with Laws...................................................70
(b) Compliance
with Environmental Laws.....................................70
(c)
Governmental
Approvals.................................................70
(d) Payment of
Taxes, Etc..................................................70
(e)
Insurance..............................................................71
(f)
Preservation of Corporate Existence,
Etc...............................71
(g) Visitation
Rights......................................................71
(h) Keeping of
Books.......................................................71
(i)
Maintenance of Properties,
Etc.........................................71
(j)
Transactions with
Affiliates...........................................71
(k) Further
Assurances.....................................................72
(l)
Preparation of Environmental
Reports...................................72
(m) Compliance
with Terms of Leaseholds....................................73
(n)
Performance of Material
Contracts......................................73
(o)
Subsidiaries...........................................................73
(p) Real
Property..........................................................74
(q)
Taxes..................................................................75
(r) Stamp
Duties,
Etc......................................................76
(s) Use of
Proceeds........................................................76
Section 5.02 Negative
Covenants of the
Borrower..............................................76
(a) Liens,
Etc.............................................................76
(b)
Debt...................................................................78
(c) Change in
Nature of Business...........................................81
(d) Mergers,
Etc...........................................................81
(e) Sales,
Etc., of
Assets.................................................82
(f)
Investments in Other
Persons...........................................85
(g) Restricted
Payments....................................................87
(h) Payment
Restrictions Affecting the Borrower and its
Subsidiaries.......88
(i)
Sale-Leaseback
Obligations.............................................89
(j) Accounting
Changes.....................................................89
(k)
Prepayments, Etc., of
Debt.............................................89
(l)
Amendment, Etc.,
of Material Contracts.................................90
(m)
Speculative
Transactions...............................................90
(n) Capital
Expenditures...................................................90
(o) Compliance
with ERISA..................................................91
(p) Formation
of Subsidiaries..............................................91
Section 5.03 Financial
Covenants of the
Borrower.............................................91
(a) Interest
Coverage
Ratio................................................91
(b) Leverage
Ratio.........................................................92
Section 5.04 Reporting
Covenants of the
Borrower.............................................93
(a) Default
Notices........................................................93
(b) Annual
Financials......................................................93
(c) Quarterly
Financials...................................................94
(d)
Budget.................................................................94
(e)
Litigation.............................................................94
(f)
ERISA..................................................................95
(g)
Environmental
Conditions...............................................95
(h) Real
Property..........................................................95
(i)
Insurance..............................................................95
(j) Other
Information......................................................96
(k) Emissions
Credits......................................................96
ARTICLE VI
EVENTS OF DEFAULT
Section 6.01 Events of
Default...............................................................97
Section 6.02 Actions
Following an Event of
Default...........................................99
Section 6.03 Default
Interest...............................................................100
ARTICLE VII
REMEDIES AND ENFORCEMENT
Section 7.01 Procedures
Following an Event of Default Prior to the Second Draw
Date.........100
ARTICLE VIII
THE AGENTS
Section 8.01
Authorization and
Action.......................................................102
Section 8.02
Reliance.......................................................................102
Section 8.03 CNAI,
CGMI, BofA, CSCI, Citibank and
Affiliates................................103
Section 8.04 Lender
Credit
Decision.........................................................103
Section 8.05
Indemnification................................................................103
Section 8.06 Successor
Administrative
Agent.................................................104
Section 8.07
Liability......................................................................104
Section 8.08
Compensation of
Agents.........................................................104
Section 8.09
Exculpatory
Provisions.........................................................105
Section 8.10 Treatment
of
Lenders...........................................................105
Section 8.11
Miscellaneous..................................................................105
(a)
Instructions..........................................................105
(b) No
Obligation.........................................................105
Section 8.12 Arranger
Parties...............................................................106
ARTICLE IX
MISCELLANEOUS
Section 9.01
Amendments, No
Waiver..........................................................106
Section 9.02 Notices,
Etc...................................................................108
Section 9.03 No Waiver,
Remedies............................................................110
Section 9.04 Indemnity
and
Expenses.........................................................110
Section 9.05 Right of
Set-off...............................................................111
Section 9.06 Binding
Effect.................................................................112
Section 9.07
Assignments and
Participations.................................................112
Section 9.08 Execution
in
Counterparts......................................................116
Section 9.09
Jurisdiction,
Etc..............................................................116
Section 9.10 Governing
Law..................................................................116
Section 9.11 Waiver of
Jury
Trial...........................................................116
Section 9.12
Confidentiality................................................................116
Section 9.13 Benefits
of
Agreement..........................................................118
Section 9.14
Severability...................................................................118
Section 9.15
Limitations....................................................................118
Section 9.16
Survival.......................................................................119
Section 9.17 USA
Patriot Act
Notice.........................................................119
SCHEDULES
Schedule I
-........Commitments and Applicable Lending Offices
Schedule 1.01(a) -........Term Mortgages
Schedule 1.01(b) -........Amended and Restated
Mortgages
Schedule 1.01(c) -........Controlled Accounts and
Operating Accounts
Schedule 1.01(d) -........Operating Agreements
Schedule 4.01(b) -........Subsidiaries
Schedule 4.01(d) -........Approvals and Filings
Schedule 4.01(f) -........Disclosed Litigation
Schedule 4.01(g) -........Disclosed Information
Schedule 4.01(n) -........Certain Environmental
Matters
Schedule 4.01(p) -........Owned Real Property
Schedule 4.01(q) -........Leased Real Property
Schedule 4.01(r) -........Material Contract
Defaults
Schedule 4.01(s) -........Qualifying Obligations
Constituting Surviving Debt
Schedule 4.01(t) -........Existing Liens
Schedule 4.01(u) -........Investments
Schedule 4.01(z) -........Insurance
Schedule 5.01(j) -........Affiliate
Transactions
EXHIBITS
Exhibit A
-........Form of Assignment and Acceptance
Exhibit B
-........Form of Notice of Borrowing
Exhibit C
-........Form of Note
Exhibit D
-........Form of Assumption and Joinder Agreement
Exhibit E
-........Form of SIA Amendment
Exhibit F
-........Real Property Requirements
Exhibit G
-........Form of Opinion of Skadden, Arps, Slate, Meagher &
Flom LLP
Exhibit H
-........Form of Opinion of Hunton & Williams LLP
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CREDIT AGREEMENT
CREDIT AGREEMENT (this "Agreement") dated as of July 21, 2005
made by and among:
ALLEGHENY ENERGY SUPPLY COMPANY, LLC, a Delaware limited
liability company (the "Borrower");
Each of the Persons (as hereinafter defined) (other than the
Borrower) listed on the signature pages
hereto as a "Loan Party" (the Borrower
and the Persons so listed being,
collectively, the "Loan Parties");
Each of the institutions listed on the signature pages hereto
as an "Initial Lender" (the "Initial
Lenders") and each other Lender (as
hereinafter defined);
CITICORP NORTH AMERICA, INC. ("CNAI"), not in its individual
capacity except as expressly set forth
herein but solely as administrative
agent for the Lenders (together with any
successor administrative agent
appointed pursuant to Section 8.06 of this
Agreement, the "Administrative
Agent"); and
CITIBANK, N.A. ("Citibank"), not in its individual capacity
except as expressly set forth herein but
solely as (a) collateral agent under
the Security Agreement (as hereinafter
defined) (together with any successor
collateral agent appointed pursuant to
Article VII of the Security Agreement,
the "Collateral Agent") and (b)
intercreditor agent (together with any
successor intercreditor agent appointed
pursuant to Article VII of the Security
Agreement, the "Intercreditor Agent") for
the Secured Parties (as hereinafter
defined).
PRELIMINARY STATEMENTS
(1) The Borrower is
indebted to certain banks and
financial institutions (the "Existing
Lenders") pursuant to that certain
Amended and Restated Credit Agreement,
dated as of February 21, 2003, as
amended and restated in its entirety on
March 8, 2004 and as further amended
and restated in its entirety on October 28,
2004 (as amended through the date
hereof, the "Existing Credit Agreement"),
among the Borrower, the other persons
referred to therein as loan parties, the
financial institutions party thereto
as lenders, CNAI, as administrative agent,
and Citibank, as collateral agent
and intercreditor agent.
(2) The Borrower has
requested that the Initial Lenders
establish a senior secured term credit
facility in the aggregate amount of
$1,069,000,000 in favor of the Borrower,
and the Initial Lenders have indicated
their willingness to provide such financing
to the Borrower on the terms and
conditions set forth in this Agreement and
the other Financing Documents (as
hereinafter defined).
(3) The proceeds of
the Facility (as hereinafter
defined) shall be used (a) on the Closing
Date (as hereinafter defined), to
refinance the aggregate principal amount
outstanding under the Existing Credit
Agreement and (b) on the Second Draw Date
(as hereinafter defined), to
refinance the aggregate principal amount
outstanding under the Senior Secured
Notes (as hereinafter defined).
NOW, THEREFORE, in consideration of the premises and of the
mutual covenants and agreements contained
herein, the parties hereto hereby
agree as follows:
ARTICLE I
DEFINITIONS AND INTERPRETATION
Section 1.01 Definitions. As used in this Agreement, unless
otherwise indicated the following terms
shall have the following
meanings:
"1940 Act" means the Investment Company Act of 1940, as
amended.
"Acceleration Notice" has the meaning specified in Section
7.01(a)(2).
"Accepting Lender" has the meaning specified in Section
2.06(c)(iii).
"Accession Agreement" has the meaning specified in the
Security Agreement.
"Account Control Agreement" has the meaning set forth in the
Security Agreement.
"Acquired Material Property" has the meaning specified in
Section 5.04(h).
"Act" has the meaning specified in Section 9.17.
"Additional Loan Party" has the meaning specified in Section
5.01(o)(ii).
"Administrative Agent" has the meaning specified in the
recital of the parties to this Agreement.
"Administrative Agent's Account" means the account of the
Administrative Agent maintained by the Administrative Agent
with
Citibank, N.A. at its office at 399 Park Avenue, New York, New
York
(ABA No. 021000089), Account No. 36852248, Reference: Allegheny
Energy
Supply Company, LLC Term C Facility, or such other account as
the
Administrative Agent shall specify in writing to the Lenders.
"Advance" has the meaning specified in Section 2.01.
"Advances Prepayment Amount" has the meaning specified in
Section 2.06(c)(i).
"AES Gleason" means Allegheny Energy Supply Gleason
Generating Facility, LLC.
"AES Wheatland" means Allegheny Energy Supply Wheatland
Generating Facility, LLC.
"AESC Hunlock Creek" means Allegheny Energy Supply Company
Hunlock Creek, LLC.
"Affiliate" means, as to any Person, any other Person that,
directly
or indirectly, controls, is controlled by or is under common
control with such Person or is a director or officer of such
Person.
For purposes of this definition, the term "control" (including
the
terms "controlling", "controlled by" and "under common control
with")
of a Person means the possession, direct or indirect, of the power
to
vote 10% or more of the Voting Interests of such Person or to
direct
or cause the direction of the management and policies of such
Person,
whether through the ownership of Voting Interests, by contract
or
otherwise.
"Affiliate Energy Contracts" means, collectively, (a) the
Power Sales Agreement between PEC and the Borrower for Maryland
dated
January 1, 2001, as supplemented by the Memorandum of the
Operating
Committee dated October 1, 2001, Amendment No. 1 to the Memorandum
of
the Operating Committee effective January 1, 2002, Amendment No. 2
to
the Memorandum of the Operating Committee effective January 1,
2003,
Amendment No. 3 to the Memorandum of the Operating Committee
effective
January 1, 2004, Amendment No. 4 to the Memorandum of the
Operating
Committee effective August 1, 2004 and Amendment No. 5 to the
Memorandum of the Operating Committee, dated January 1, 2005; (b)
the
Power Sales Agreement between PEC and the Borrower for Virginia
dated
January 1, 2001, as supplemented by the Memorandum of the
Operating
Committee dated October 1, 2001, Amendment No. 1 to the Memorandum
of
the Operating Committee effective January 1, 2002, Amendment No. 2
to
the Memorandum of the Operating Committee effective January 1,
2003,
Amendment No. 3 to the Memorandum of the Operating Committee
effective
January 1, 2004 and Amendment No. 4 to the Memorandum of the
Operating
Committee effective August 1, 2004; (c) the Facilities Lease
Agreement
between PEC and the Borrower for West Virginia dated August 1,
2000,
the Lease Agreement extension dated March 14, 2003, and the
Service
Agreement between PEC and the Borrower for West Virginia dated
August
1, 2000; (d) the Power Sales Agreement between WPPC and the
Borrower
for Pennsylvania dated January 1, 2001, as supplemented by the
Memorandum of the Operating Committee dated August 1, 2001,
Amendment
No. 1 to the Memorandum of the Operating Committee effective
January
1, 2002, Amendment No. 2 to the Memorandum of the Operating
Committee
effective January 1, 2003, Amendment No. 3 to the Memorandum of
the
Operating Committee effective January 1, 2004, Amendment No. 4 to
the
Memorandum of the Operating Committee effective August 1, 2004
and
Amendment No. 5 to the Memorandum of the Operating Committee,
dated
October 1, 2005; (e) the Facilities Lease Agreement between MPC
and
the Borrower for Ohio dated June 1, 2001; and (f) the Power
Sales
Agreement between MPC and the Borrower for Ohio dated June 1, 2001,
as
supplemented by the Memorandum of the Operating Committee dated
August
1, 2001, Amendment No. 1 to the Memorandum of the Operating
Committee
effective January 1, 2002, Amendment No. 2 to the Memorandum of
the
Operating Committee effective January 1, 2003, Amendment No. 3 to
the
Memorandum of the Operating Committee effective January 1,
2004,
Amendment No. 4 to the Memorandum of the Operating Committee
effective
August 1, 2004 and Amendment No. 5 to the Memorandum of the
Operating
Committee, dated January 1, 2005.
"Affiliate Subordination Terms" means, with respect to any
Debt or other Obligations owed by the Borrower or any of its
Subsidiaries to any Affiliate thereof, that such Debt is either
(a)
subject to the terms set forth in Section 9.03 of the Security
Agreement or (b) subject to an agreement which subordinates such
Debt
to the Obligations owed in respect of the Advances on identical
terms
to those set forth in Section 9.03 of the Security Agreement.
"AGC" means Allegheny Generating Company, a Virginia
corporation.
"Agent Parties" has the meaning specified in Section 9.02(d).
"Agents" means the Administrative Agent, the Intercreditor
Agent and the Collateral Agent.
"Agreement" has the meaning specified in the recital of the
parties to this Agreement.
"Agreement Value" means, for each Hedge Agreement, on any
date of determination, an amount determined by the Borrower in
good
faith equal to: (a) in the case of a Hedge Agreement documented
pursuant to the Master Agreement (as defined in the definition of
a
"Hedge Agreement"), the amount, if any, that would be payable by
the
Borrower
or any of its Subsidiaries to its counterparty to such Hedge
Agreement pursuant to the terms of such Hedge Agreement, as if
(i)
such Hedge Agreement was being terminated early on such date of
determination, (ii) the Borrower or such Subsidiary was the
sole
"Affected Party", and (iii) the Borrower or such Subsidiary was
the
sole party determining such payment amount (with the Borrower
making
such determination pursuant to the provisions of the Master
Agreement
or the Hedge Agreement (whichever is applicable)); or (b) in the
case
of a Hedge Agreement traded on an exchange, the mark-to-market
value
of such Hedge Agreement, which will be the unrealized loss on
such
Hedge Agreement (after any netting permitted pursuant to the terms
of
such Hedge Agreement (including any netting across different
Hedge
Agreements and Master Agreements to the extent permitted by
contract))
to the Borrower or any of its Subsidiaries party to such Hedge
Agreement, if any, determined by the Borrower in good faith based
on
the settlement price of such Hedge Agreement on such date of
determination, or (c) in all other cases, the mark-to-market value
of
such Hedge Agreement, which will be the unrealized loss on such
Hedge
Agreement (after any netting permitted pursuant to the terms of
such
Hedge Agreement (including any netting across different Hedge
Agreements and Master Agreements to the extent permitted by
contract))
to the Borrower or any of its Subsidiaries party to such Hedge
Agreement, if any, as determined by the Borrower in good faith
in
accordance with the terms of such Hedge Agreement or, if such
Hedge
Agreement does not provide a methodology for such determination,
the
amount, if any, by which (i) the present value of the future
cash
flows to be paid by the Borrower or any of its Subsidiaries
party
thereto, as the case may be, exceeds (ii) the present value of
the
future cash flows to be received by the Borrower or such
Subsidiary,
as the case may be, pursuant to such Hedge Agreement;
capitalized
terms used and not otherwise defined in this definition shall have
the
respective meanings set forth in the above described Master
Agreement.
"ALTA Survey" means a fully paid American Land Title
Association/American Congress on Surveying and Mapping form
survey.
"Amended and Restated Mortgages" means the deeds of trust,
trust deeds and mortgages set forth on Schedule 1.01(b).
"Amendment Fee" means any fee offered, paid or payable to any
Lender by the Borrower or any Affiliate of the Borrower
(whether
directly or through any Agent or any other Person) in
consideration
for any waiver of, or agreement to amend or modify any provision
of,
any of the Financing Documents.
"Applicable Law" means, with respect to any Person, any and
all laws, statutes, regulations, rules, orders, injunctions,
decrees,
writs, determinations, awards and judgments issued by any
Governmental
Authority applicable to such Person, including all Environmental
Laws.
"Applicable Lending Office" means, with respect to each
Lender, such Lender's Domestic Lending Office in the case of a
Base
Rate Advance and such Lender's Eurodollar Lending Office in the
case
of a Eurodollar Rate Advance.
"Applicable Margin" means 0.75% per annum for Base Rate
Advances and 1.75% per annum for Eurodollar Rate Advances;
provided
that if at any time the Borrower's Senior Secured Debt Rating from
(i)
S&P shall be "BB" or higher and Moody's shall be "Ba1" or
higher, or
(ii) S&P shall be "BB+" or higher and Moody's shall be "Ba2"
or
higher, "Applicable Margin" shall mean 0.50% per annum for Base
Rate
Advances and 1.50% per annum for Eurodollar Rate Advances.
"Approved Fund" means a Fund that is administered or managed
by (a) a Lender, (b) an Affiliate of a Lender or (c) a Person or
an
Affiliate of a Person that administers or manages a Lender.
"Armstrong Facility" means the Armstrong generating facility
located near Adrian, Pennsylvania in Armstrong County,
Pennsylvania
and owned by the Borrower.
"Arranger Parties" means Citigroup Global Markets Inc.
("CGMI"), as Lead Arranger and Joint Book Runner, Banc of
America
Securities LLC ("BofA"), as Syndication Agent and Joint Book
Runner,
and Credit Suisse, Cayman Islands Branch ("CSCI"), as
Documentation
Agent and Joint Book Runner.
"Asset Sale" means any Sale of any Asset (including, without
limitation, Emissions Credits) by the Borrower or any of its
Subsidiaries to any Person other than the Borrower or any of
its
Subsidiaries, other than (a) Sales of Emission Credits in the
ordinary
course of business to the extent that the Net Cash Proceeds
received
by the Borrower and its Subsidiaries therefrom are less than or
equal
to $40,000,000 in the aggregate in any fiscal year of the Borrower
and
such Sale does not contravene the terms of Section 5.02(e)(ii) and
(b)
Sales pursuant to clause (i), (iii), (iv), (vii), (viii), (ix),
(x),
(xi) or (xii) of Section 5.02(e).
"Assets" means, with respect to any Person, all or any part
of its business, property, rights, interests and assets, both
tangible
and intangible (including Equity Interests in any Person),
wherever
situated.
"Assignment and Acceptance" means an assignment and
acceptance entered into by a Lender and an Eligible Assignee,
and
accepted by the Administrative Agent, in accordance with Section
9.07
and in substantially the form of Exhibit A.
"Assumption and Joinder Agreement" means an assumption and
joinder agreement executed by any Subsidiary of the Borrower
pursuant
to Section 5.01(o) and in substantially the form of Exhibit D.
"AYE Money Pool" means the internal financing facility of the
Parent and certain of its Subsidiaries in which the excess funds
of
certain participants are used to satisfy the short-term
borrowing
needs of other participants.
"Authorized Signatory" means, with respect to any Person, the
individual, or any of the individuals, authorized to sign any
Financing Document, as well as any other agreements, to which
such
Person is or is to be a party and give written instructions on
behalf
of such Person with regard to any matters pertaining to any
Financing
Document to which such Person is or is to be a party (as identified
on
an incumbency certificate submitted to the Administrative Agent
and
the Collateral Agent from time to time prior to the receipt of
any
instructions from such Authorized Signatory).
"Base Rate" means a fluctuating interest rate per annum in
effect from time to time, which rate per annum shall at all times
be
equal to the higher of:
(a) the rate of interest announced publicly by
Citibank in New York, New York, from time to time, as
Citibank's base rate; and
(b) the Federal Funds Rate plus 0.5%.
"Base Rate Advance" means an Advance that bears interest as
provided in Section 2.07(a)(i).
"Bingamon Creek Property" means the 34-acre property located
in Harrison County, West Virginia and owned by the Borrower and
MPC,
but excluding any related personal property the creation, granting
or
perfection of a Lien upon or in which is governed by the UCC.
"BofA" has the meaning specified in the definition of the
term "Arranger Parties".
"Bond Instruments" means (a) the Existing Indentures, (b) the
Indenture dated as of December 1, 1986 between AGC, as issuer,
and
U.S. Bank Trust, National Association (successor trustee to
Morgan
Guaranty Trust Company of New York), as trustee and (c) the
Pollution
Control Bond Indentures.
"Borrower" has the meaning specified in the recital of
parties to this Agreement.
"Borrower's Account" means the account of the Borrower
specified by the Borrower in writing to the Administrative Agent
from
time to time.
"Borrowing" means a borrowing consisting of simultaneous
Advances of the same Type, made by the Lenders.
"Buffalo Reserve Project" means the development of property
and mineral rights in Washington County, Commonwealth of
Pennsylvania,
including (a) the formation of a legal entity to pursue the
development of such property and mineral rights, and (b) the
entering
into operating agreements, joint venture agreements,
partnership
agreements, working interests, royalty interests, mineral
leases,
processing agreements, contracts for sale, transportation or
exchange
agreements, unitization agreements, pooling agreements, area of
mutual
interest agreements, production sharing agreements or other similar
or
customary agreements, transactions, interests or arrangements,
and
Investments and expenditures in connection with the development
of
such property and mineral rights.
"Business Day" means a day of the year on which banks are not
required or not authorized by law to close in New York City and,
if
the applicable Business Day relates to any Eurodollar Rate
Advances,
on which dealings are carried on in the London interbank
market.
"Capital Expenditures" means, for any Person for any period,
the sum of, without duplication, all expenditures made, directly
or
indirectly, by such Person during such period (whether financed
by
cash or by Debt (including Obligations under Capitalized
Leases)
assumed or incurred to fund, directly or indirectly, such
expenditures) for equipment, fixed assets, real property or
improvements, or for replacements or substitutions therefor or
additions thereto, that have been or should be, in accordance
with
GAAP, reflected as additions to property, plant or equipment on
a
balance sheet of such Person. For purposes of this definition,
the
purchase price of equipment that is purchased simultaneously with
the
trade-in of existing equipment or with insurance proceeds shall
be
included in Capital Expenditures only to the extent of the excess
(if
any) of the gross amount of such purchase price over the credit
granted by the seller of such equipment for the equipment being
traded
in at such time or the amount of such proceeds, as the case may
be.
"Capitalized Leases" means all leases that have been or
should be, in accordance with GAAP, recorded as capitalized
leases.
"Cash Equivalents" means any of the following, to the extent
owned by the Borrower or any of its Subsidiaries free and clear of
all
Liens other than Liens created under the Collateral Documents
and,
except in the case of clause (d) below, having a maturity of
not
greater than one year from the date of issuance thereof: (a)
readily
marketable direct obligations of the Government of the United
States
or any agency or instrumentality thereof or obligations
unconditionally guaranteed by the full faith and credit of the
Government of the United States, (b) certificates of deposit,
time
deposits, eurodollar deposits and bankers acceptances with any
commercial bank that is an Agent or Lender or a member of the
Federal
Reserve System, is organized under the laws of the United States
or
any State thereof and has combined capital and surplus of at
least
$500,000,000; provided that the aggregate principal amount of
certificates of deposit, time deposits, eurodollar time deposits
and
bankers acceptances of any one bank shall not exceed $50,000,000
at
any one time, (c) commercial paper in an aggregate amount of no
more
than $50,000,000 per issuer outstanding at any time, issued by
any
corporation organized under the laws of any State of the United
States
and rated at least "Prime-1" (or the then equivalent grade) by
Moody's
or "A-1" (or the then equivalent grade) by S&P, or (d) with
respect to
any Pledged Account, Controlled Account or Operating Account,
investments in any mutual fund the sole investments of which are
the
cash equivalents identified in clauses (a) through (c) above (but
with
a remaining maturity of not greater than 13 months while being held
by
the applicable mutual fund) or (e) repurchase obligations for any
of
the cash equivalents identified in clause (a) above.
"CERCLA" means the Comprehensive Environmental Response,
Compensation and Liability Act of 1980, as amended from time to
time.
"CERCLIS" means the Comprehensive Environmental Response,
Compensation and Liability Information System maintained by the
U.S.
Environmental Protection Agency.
"CGMI" has the meaning specified in the definition of the
term "Arranger Parties".
"Change of Control" means the occurrence of any of the
following: (a) the Parent shall cease to own all issued and
outstanding Equity Interests in the Borrower other than the ML
Interests; (b) any Person or two or more Persons acting in
concert
shall have acquired beneficial ownership (within the meaning of
Rule
13d-3 of the Securities and Exchange Commission under the
Securities
Exchange Act of 1934), directly or indirectly, of Voting Interests
of
the Parent (or other securities convertible into such Voting
Interests) representing 40% or more of the combined voting power
of
all Voting Interests of the Parent; (c) during any period of up to
24
consecutive months, commencing before or after the date of this
Agreement, individuals who at the beginning of such 24-month
period
were directors of the Parent (the "Original Directors") shall
cease
for any reason to constitute a majority of the board of directors
of
the Parent (unless replaced by individuals nominated or proposed
by
the Original Directors); or (d) any Person or two or more
Persons
acting in concert shall have acquired by contract or otherwise,
or
shall have entered into a contract or arrangement that, upon
consummation, will result in its or their acquisition of the power
to
exercise, directly or indirectly, a controlling influence over
the
management or policies of the Parent.
"Chief Financial Officer" of any Person means such Person's
chief financial officer or such other natural person who is
principally responsible for such Person's financial matters.
"Citibank" has the meaning specified in the recital of the
parties to this Agreement.
"Closing Date" has the meaning specified in Section 3.01(a).
"Closing Date Transactions" has the meaning specified in
Section 3.01(a)(xvi).
"CNAI" has the meaning specified in the recital of the
parties to this Agreement.
"Collateral" has the meaning specified in the Security
Agreement.
"Collateral Agent" has the meaning specified in the recital
of the parties to this Agreement.
"Collateral Documents" means the Security Agreement, the SIA
Amendment, the Mortgages, the Consents, the Account Control
Agreements
and any other agreement that creates or purports to create a Lien
in
favor of the Collateral Agent for the benefit of the Secured
Parties
or that acknowledges the creation of such a Lien.
"Commitment" means, with respect to any Lender at any time,
(a) the amount set forth opposite such Lender's name on Schedule
I
under the caption "Commitment," or, (b) if such Lender has
entered
into one or more Assignment and Acceptances on or prior to such
time,
set forth for such Lender in the Register maintained by the
Administrative Agent pursuant to Section 9.07(d) as such
Lender's
"Commitment", in each case, as such amount may be reduced at or
prior
to such time pursuant to Section 2.04 or 6.01.
"Commitment Effective Date" has the meaning specified in
Section 2.14(b).
"Communications" has the meaning specified in Section
9.02(b).
"Conemaugh" means Allegheny Energy Supply Conemaugh, LLC.
"Confidential Information" has the meaning specified in
Section 9.12(a).
"Consents" has the meaning specified in the Security
Agreement.
"Consolidated" refers to the consolidation of accounts in
accordance with GAAP.
"Consolidated EBITDA" means, for any period, Consolidated Net
Income for such period plus (a) without duplication and to the
extent
deducted in determining such Consolidated Net Income, the sum of
(i)
Consolidated Interest Expense for such period, (ii)
consolidated
income tax expense for such period, (iii) all amounts attributable
to
minority interests and to depreciation and amortization for
such
period (including amortization of Debt issuance costs), (iv)
any
extraordinary or non-recurring non-cash charges (including the
write-down of non-current assets) or any gains for such period,
(v)
any non-cash goodwill or other intangible asset impairment
charges
resulting from the application of Statement Number 142 or
Statement
Number 144 of the Financial Accounting Standards Board, (vi)
any
non-recurring expenses or non-cash charges incurred in connection
with
the Transactions and (vii) any non-cash compensation charges,
including any such charges arising from stock options,
restricted
stock grants and other equity incentive programs; provided that to
the
extent that all or any portion of the net income of any Subsidiary
of
the Borrower or any other Person is excluded from Consolidated
Net
Income pursuant to the definition thereof for all or any portion
of
such period any amounts set forth in the preceding clauses (i)
through
(vii) that are attributable to such Subsidiary or other Person
shall
not be included for purposes of this clause (a) for such period
or
portion thereof, and minus (b) without duplication (i) all cash
payments made during such period on account of reserves,
restructuring
charges and other non-cash charges added to Consolidated Net
Income
pursuant to clause (a) above after the Closing Date and (ii) to
the
extent included in determining such Consolidated Net Income,
any
extraordinary gains and all non-cash items of income for such
period,
all determined on a consolidated basis in accordance with GAAP;
provided that for purposes of calculating Consolidated EBITDA for
any
period for purposes of the covenants set forth in Section 5.03,
(A)
the Consolidated EBITDA of any Investment made or Subsidiary
acquired
by the Borrower or any Subsidiary in accordance with the terms of
this
Agreement during such period for which aggregate consideration paid
by
the Borrower or any of its Subsidiaries shall be equal to or
greater
than $25,000,000 shall be included on a pro forma basis for
such
period (assuming the consummation of such acquisition and the
incurrence or assumption of any Debt in connection therewith
occurred
as of the first day of such period), and (B) the Consolidated
EBITDA
of any Person or line of business sold or otherwise disposed of by
the
Borrower or any of its Subsidiaries during such period for which
the
aggregate consideration received by the Borrower or any of its
Subsidiaries shall be equal to or greater than $25,000,000 shall
be
excluded for such period (assuming the consummation of such sale
or
other disposition and the repayment of any Debt in connection
therewith occurred as of the first day of such period).
"Consolidated First Lien Secured Debt" means, as of any date
of determination and, without duplication, for the Borrower and
its
Subsidiaries on a Consolidated basis, the sum of the principal
amount
of all outstanding Debt for Borrowed Money owed by the Borrower
and
its Subsidiaries on such date which Debt is purported to be secured
by
a first priority Lien over any of the Assets of the Borrower or any
of
its Subsidiaries as of such date of determination, including,
without
limitation, the Secured Obligations and Obligations owed by the
Borrower and its Subsidiaries under the Pollution Control
Bonds.
"Consolidated Interest Expense" means, for any period, (a)
the sum of, without duplication, (i) the interest expenses
(including
imputed interest expense in respect of Capitalized Leases) of
the
Borrower and its Subsidiaries for such period (including all
commissions, discounts and other fees and charges owed by the
Borrower
and its Subsidiaries with respect to letters of credit and
bankers'
acceptance financing), net of interest income, in each case
determined
on a consolidated basis in accordance with GAAP, plus (ii) any
interest accrued during such period in respect of Debt of the
Borrower
or any of its Subsidiaries that is required to be capitalized
rather
than included in consolidated interest expenses for such period
in
accordance with GAAP, minus (b) to the extent included in such
consolidated interest expense for such period, amounts attributable
to
the amortization of financing costs and non-cash amounts
attributable
to the amortization of debt discounts. For purposes of the
foregoing,
interest
expense shall be determined after giving effect to any net
payments made or received by the Borrower or any of its
Subsidiaries
with respect to interest rate Hedge Agreements which are included
as
interest expense in accordance with GAAP.
"Consolidated Net Income" means, for any period, the net
income or loss before cumulative effect in change of accounting
principles of the Borrower and its Subsidiaries for such period
determined on a consolidated basis in accordance with GAAP;
provided
that there shall be excluded (a) the income of any Subsidiary of
the
Borrower to the extent that the declaration or payment of dividends
or
similar distributions by such Subsidiary of that income is not, as
a
result of any Subsidiary Debt Default, at the time permitted by
operation of the terms of the agreement or other documents
governing
the Debt under which such Subsidiary Debt Default shall have
occurred;
provided that such income of such Subsidiary shall only be so
excluded
for that portion of such period during which the condition
described
in this clause (a) shall so exist; (b) the income or loss of
any
Person accrued prior to the date it becomes a Subsidiary or is
merged
or Consolidated with the Borrower or any Subsidiary on the date
such
Person's Assets are acquired by the Borrower or any Subsidiary;
(c)
the income or loss of any Person (other than a Subsidiary) in
which
any other Person (other than the Borrower or a wholly owned
Subsidiary
of the Borrower) has an interest, except to the extent of the
amount
of dividends or other distributions actually paid to the Borrower
or a
wholly owned Subsidiary by such Person during such period; (d)
any
gains or losses attributable to sales of Assets out of the
ordinary
course of business; and (e) any gains or losses attributable to
interest rate Hedge Agreements which are not included as
interest
expense in accordance with GAAP.
"Constituent Documents" means, with respect to any Person,
(a) the articles or certificate of incorporation or other
similar
organizational document of such Person, (b) the by-laws or
other
similar document of such Person, (c) any certificate of designation
or
instrument relating to the rights of holders (including
preferred
shareholders) of
Equity Interests in such Person and (d) any
shareholder rights agreement or other similar agreement.
"Contest" means, with respect to the payment of Taxes or any
other claims or liabilities by any Person, to contest the validity
or
amount thereof in good faith by appropriate proceedings timely
instituted and diligently pursued within the applicable
statutory
period and in accordance with Applicable Law; provided that the
following
conditions are satisfied: (a) such Person has posted a bond
or other security in accordance with Applicable Law (if required)
or
has established adequate reserves with respect to the contested
items
in accordance with, and to the extent required by, GAAP; (b)
during
the period of such contest, the enforcement of any contested item
is
effectively stayed; (c) neither such Person nor any of its
officers,
directors or employees nor any Secured Party or its respective
officers, directors or employees is, or could reasonably be
expected
to become, subject to any criminal liability or sanction in
connection
with such contested items; and (d) no Lien relating to such
contest
attaches to any Assets of such Person and becomes enforceable
against
other creditors of such Person.
"Contingent Obligation" means, with respect to any Person,
any Obligation or arrangement of such Person to guarantee or
intended
to guarantee any Debt, leases, dividends or other payment
Obligations
("primary obligations") of any other Person (the "primary obligor")
in
any manner, whether directly or indirectly, including (a) the
direct
or indirect guarantee, endorsement (other than for collection
or
deposit in the ordinary course of business), co-making,
discounting
with recourse or sale with recourse by such Person of the
Obligation
of a primary obligor, (b) the Obligation to make take-or-pay or
similar payments, if required, regardless of nonperformance by
any
other party or parties to an agreement or (c) any Obligation of
such
Person, whether or not contingent, (i) to purchase any such
primary
obligation or any property constituting direct or indirect
security
therefor, (ii) to advance or supply funds (A) for the purchase
or
payment of any such primary obligation or (B) to maintain
working
capital or equity capital of the primary obligor or otherwise
to
maintain the net worth or solvency of the primary obligor, (iii)
to
purchase Assets, securities or services primarily for the purpose
of
assuring the owner of any such primary obligation of the ability
of
the primary obligor to make payment of such primary obligation or
(iv)
otherwise to assure or hold harmless the holder of such primary
obligation against loss in respect thereof. The amount of any
Contingent Obligation shall be deemed to be an amount equal to
the
stated or determinable amount of the primary obligation in respect
of
which such Contingent Obligation is made (or, if less, the
maximum
amount of such primary obligation for which such Person may be
liable
pursuant to the terms of the instrument evidencing such
Contingent
Obligation) or, if not stated or determinable, the maximum
reasonably
anticipated liability in respect thereof (assuming such Person
is
required to perform thereunder), as determined by such Person in
good
faith.
"Continuation", "Continue" and "Continued" each refer to a
continuation of Eurodollar Rate Advances upon the expiration of
the
Interest Period therefor as Eurodollar Rate Advances of the same or
a
different Interest Period pursuant to Section 2.03.
"Controlled Account" has the meaning specified in the
Security
Agreement.
"Conversion", "Convert" and "Converted" each refer to a
conversion of Advances of one Type into Advances of the other
Type
pursuant to Section 2.03, 2.10 or 2.11.
"Covered Taxes" has the meaning specified in Section 2.12(a).
"CSCI" has the meaning specified in the definition of the
term "Arranger Parties".
"Deadlock Notice" has the meaning specified in Section
7.01(a)(3).
"Debt" of any Person (the "obligor") means, without
duplication, (a) all Obligations of such obligor for or in respect
of
moneys borrowed or raised (whether or not for cash by whatever
means
(including acceptances, deposits, discounting, letters of
credit,
factoring (other than on a non-recourse basis))), and any other
form
of financing which is recognized in accordance with GAAP in the
obligor's financial statements as being in the nature of a
borrowing
or is treated as "off-balance" sheet financing; (b) all Obligations
of
the obligor evidenced by notes, bonds, debentures or other
similar
instruments issued in connection with accounts payable excluded
pursuant to the
parenthetical in clause (c) below; (c) all Obligations
of the obligor for the deferred purchase price of property or
services
(other than accounts payable within 90 days of being incurred
arising
in the ordinary course of such obligor's business and not more than
90
days past due and not subject to a Contest); (d) all Obligations
of
such obligor under conditional sale or other title retention
agreements relating to Assets acquired by such obligor (even
though
the rights and remedies of the seller or lender under such
agreement
in the event of default are limited to repossession or sale of
such
property); (e) all Obligations of such obligor under any
securitization or monetization arrangement; (f) all Obligations
of
such obligor as lessee under Capitalized Leases; (g) all
Obligations
of the obligor, contingent or otherwise, of the obligor under
acceptance, letter of credit or similar facilities other than
as
issued (i) in connection with Obligations excluded pursuant to
clause
(b) above or the parenthetical in clause (c) above or (ii) as
credit
support for leases other than Capitalized Leases; (h) all
Obligations
of the obligor to purchase, redeem, retire, defease or otherwise
make
any payments in respect of any Equity Interests in the obligor or
any
other Person or any warrants, rights or options to acquire such
capital stock, valued, in the case of Redeemable Preferred
Interests,
at the greater of its voluntary or involuntary liquidation
preference
plus accrued and unpaid dividends; (i) all Obligations of the
obligor
in respect of Hedge Agreements; (j) all Contingent Obligations of
the
obligor with respect to Debt; and (k) all indebtedness and
other
payment Obligations referred to in clauses (a) through (j) above
of
another Person secured by (or for which the holder of such Debt has
an
existing right, contingent or otherwise, to be secured by) any Lien
on
property (including accounts and contract rights owned by the
obligor), even though the obligor has not assumed or become liable
for
the
payment of such indebtedness or other payment Obligations.
"Debt for Borrowed Money" means Debt of the types specified
in (i) clauses (a), (b), (d), (e) and (f) of the definition of
Debt
and (ii) to the extent relating to Debt of the types specified in
one
or more of clauses (a), (b), (d), (e) and (f) of the definition
of
Debt, clauses (j) and (k) thereof.
"Debt Issuance" means any incurrence or issuance of Debt for
Borrowed Money by the Borrower or any of its Subsidiaries, other
than
any Debt permitted to be incurred under Section 5.02(b).
"Decision Period" means, with respect to any decision to be
made for purposes of Section 7.01, the period commencing on the
date
of the Notice of Default related thereto and ending ten Business
Days
after the date of such Notice of Default; provided that if any of
the
Lenders shall require any extension of time to make any such
decision,
such Person may, upon written notice to the Administrative
Agent
within the Decision Period specified in the notice of the
Administrative Agent delivered thereunder, extend such Decision
Period
for such Person for an additional period of time as specified in
such
notice; provided further that any such extension shall not exceed
ten
Business Days beyond the final date of the original Decision
Period.
"Declining Lender" has the meaning specified in Section
2.06(c)(iii).
"Default" means any Event of Default or any event that would
constitute an Event of Default but for the requirement that notice
be
given or time elapse or both.
"Disclosed Litigation" has the meaning specified in Section
3.01(b).
"Disclosed Matters" means the occurrence of any event in
respect of, or effect upon the business, condition (financial
or
otherwise),
operations, performance, properties, assets, liabilities
(actual or contingent) results of operation or prospects of the
Borrower or the Borrower and its Subsidiaries, taken as a whole,
which
has been disclosed (a) pursuant to a public filing by the Parent
with
the SEC or (b) in writing to the Administrative Agent.
"Domestic Lending Office" means, with respect to any Lender,
the office of such Lender specified as its "Domestic Lending
Office"
beneath such Lender's signature to this Agreement or in the
Assignment
and Acceptance pursuant to which it became a Lender, as the case
may
be, or such other office of such Lender as such Lender may from
time
to time specify
to the Borrower and the Administrative Agent.
"Eligible Assignee" means, with respect to any Lender, (i)
any other Lender; (ii) an Affiliate of a Lender; (iii) an
Approved
Fund; (iv) a commercial bank organized under the laws of the
United
States, or any State thereof, and having a combined capital and
surplus of at least $500,000,000; (v) a savings and loan
association
or savings bank organized under the laws of the United States, or
any
State thereof, and having a combined capital and surplus of at
least
$500,000,000; (vi) a commercial bank organized under the laws of
any
other country that is a member of the OECD or has concluded
special
lending arrangements
with the International Monetary Fund associated
with its General Arrangements to Borrow or a political subdivision
of
any such country, and having a combined capital and surplus of
at
least $500,000,000, so long as such bank is acting through a branch
or
agency located in the country in which it is organized or
another
country that is described in this clause (vi); (vii) the central
bank
of any country that is a member of the OECD; (viii) a finance
company,
insurance company or other financial institution or fund (whether
a
corporation, partnership, trust or other entity) that is engaged
in
making, purchasing or otherwise investing in commercial loans in
the
ordinary course of its business and having a combined capital
and
surplus of at least $500,000,000 (or, in the case of a fund,
being
managed or administered by a Person that manages or administers
funds
having a combined capital and surplus of at least $500,000,000);
or
(ix) any other Person approved by the Administrative Agent and,
so
long as no Default or Event of Default shall have occurred and
be
continuing, the Borrower, such approval, in either case, not to
be
unreasonably withheld or delayed; provided that neither the
Borrower
nor any Affiliate of the Borrower shall qualify as an Eligible
Assignee under this definition.
"Emissions Credits" means the emissions limitations which:
(a) are issued by environmental Governmental Authorities; (b)
authorize the emission of a fixed amount of pollutants; and (c)
are
utilized as a market-based mechanism for reducing pollution.
"Environmental Action" means any action, suit, demand letter,
claim by any Governmental Authority, notice of non-compliance
or
violation, notice of liability or potential liability,
investigation,
proceeding, consent order or consent agreement relating to any
Environmental Law, Environmental Permit or Hazardous Material
or
arising from alleged injury or threat to health and safety or
the
environment relating to any Environmental Law, including (a) by
any
governmental or regulatory authority for enforcement, cleanup,
removal, response, remedial or other actions or damages and (b) by
any
governmental or regulatory authority or third party for
damages,
contribution, indemnification, cost recovery, compensation or
injunctive relief.
"Environmental Law" means any Federal, state, local or
foreign statute, law, ordinance, rule, regulation, code, order,
writ,
judgment, injunction, decree or legally binding judicial or
agency
interpretation, policy or guidance relating to pollution or
protection
of the environment, health and safety as it relates to
Hazardous
Materials or natural resources, including those relating to the
use,
handling, transportation, treatment, storage, disposal, release
or
discharge of Hazardous Materials.
"Environmental Permit" means any permit, approval,
identification number, license or other authorization required
under
any Environmental Law.
"Equity Interests" means, with respect to any Person, shares
of capital stock of (or other ownership or profit interests in)
such
Person, warrants, options or other rights for the purchase or
other
acquisition from such Person of shares of capital stock of (or
other
ownership or profit interests in) such Person, non-Debt
securities
convertible into or exchangeable for shares of capital stock of
(or
other ownership or profit interests in) such Person, warrants,
rights
or options for the purchase or other acquisition from such Person
of
such shares (or such other interests), and other ownership or
profit
interests in such Person (including partnership, member or
trust
interests therein), whether voting or nonvoting, and whether or
not
such shares, warrants, options, rights or other interests are
authorized or otherwise existing on any date of determination.
"ERISA" means the Employee Retirement Income Security Act of
1974, as amended from time to time, and the regulations
promulgated
and rulings issued thereunder.
"ERISA Affiliate" means any Person that for purposes of Title
IV of ERISA is a member of the controlled group of the Borrower or
any
of its Subsidiaries, or under common control within the meaning
of
Section 414 of the Internal Revenue Code, with the Borrower or any
of
its Subsidiaries.
"ERISA Event" means (a) (i) the occurrence of a reportable
event, within the meaning of Section 4043(c) of ERISA, with respect
to
any Plan unless the 30-day notice requirement with respect to
such
event has been waived by the PBGC or (ii) the requirements of
Section
4043(b) of ERISA apply with respect to a contributing sponsor,
as
defined in Section 4001(a)(13) of ERISA, of a Plan, and an
event
described in paragraph (9), (10), (11), (12) or (13) of Section
4043(c) of ERISA is reasonably expected to occur with respect to
such
Plan within the following 30 days; (b) the application for a
minimum
funding waiver in accordance with Section 412(d) of the
Internal
Revenue Code with respect to a Plan; (c) the provision by the
administrator of any Plan of a notice of intent to terminate
such
Plan, pursuant to Section 4041(a)(2) of ERISA (including any
such
notice with respect to a plan amendment referred to in Section
4041(e)
of ERISA); (d) the cessation of operations at a facility of the
Borrower or any of its Subsidiaries or any ERISA Affiliate in
the
circumstances described in Section 4062(e) of ERISA; (e) the
withdrawal by the Borrower or any of its Subsidiaries or any
ERISA
Affiliate from a Multiple Employer Plan during a plan year for
which
it was a substantial employer, as defined in Section 4001(a)(2)
of
ERISA; (f) a lien has been imposed under Section 302(f) of ERISA
with
respect to any Plan; (g) the adoption of an amendment to a Plan
requiring the provision of security to such Plan pursuant to
Section
307 of ERISA; or (h) the institution by the PBGC of proceedings
to
terminate a Plan pursuant to Section 4042 of ERISA, or the
occurrence
of any event or condition described in Section 4042 of ERISA
that
constitutes grounds for the termination of, or the appointment of
a
trustee to administer, such Plan, provided, however, that the
occurrence of the event or condition described in Section
4042(a)(4)
of ERISA shall be an ERISA Event only if the PBGC has notified
the
Borrower, any Subsidiary of the Borrower or any ERISA Affiliate
that
it intends to institute proceedings to terminate a Plan pursuant
to
such Section.
"Eurocurrency Liabilities" has the meaning specified in
Regulation D of the Board of Governors of the Federal Reserve
System,
as in effect from time to time.
"Eurodollar Lending Office" means, with respect to any
Lender, the office of such Lender specified as its "Eurodollar
Lending
Office" beneath such Lender's signature to this Agreement or in
the
Assignment and Acceptance pursuant to which it became a Lender (or,
if
no such office is specified, its Domestic Lending Office), or
such
other office of such Lender as such Lender may from time to
time
specify to the Borrower and the Administrative Agent.
"Eurodollar Rate" means, with respect to any Interest Period
for any Eurodollar Rate Advances, the rate per annum obtained
by
dividing (a) LIBOR for such Interest Period by (b) a percentage
equal
to 1.00 minus the Eurodollar Rate Reserve Percentage.
"Eurodollar Rate Advance" means an Advance that bears
interest as provided in Section 2.07(a)(ii).
"Eurodollar Rate Reserve Percentage" for any Interest Period
for any Eurodollar Rate Advances means the reserve percentage
applicable two Business Days before the first day of such
Interest
Period under regulations issued from time to time by the Board
of
Governors of the Federal Reserve System (or any successor) for
determining the maximum reserve requirement (including any
emergency,
supplemental or other marginal reserve requirement) for a member
bank
of the Federal Reserve System in New York City with respect to
liabilities or assets consisting of or including Eurocurrency
Liabilities (or with respect to any other category of liabilities
that
includes deposits by reference to which the interest rate on
Eurodollar Rate Advances is determined) having a term equal to
such
Interest Period.
"Event of Default" has the meaning specified in Section 6.01.
"Excess Cash Flow" means for any fiscal year of the Borrower,
(a) cash flows from operations for such fiscal year in accordance
with
GAAP and, without duplication, tax refunds received during such
fiscal
year, after application of the Tax Allocation Agreement, minus
(b)
cash outflows from investing activities for Capital Expenditures
of
the Borrower or any of its Subsidiaries during such fiscal year to
the
extent permitted by the Financing Documents, minus (c) cash
outflows
from financing activities (including payment of scheduled debt
maturities (but not optional prepayments of any Debt (other than
(i)
optional prepayments made in respect of the Advances and (ii)
optional
prepayments made by the Borrower in respect of the Parent
Credit
Agreement during any such year, net of borrowings made by the
Borrower
under the Parent Credit Agreement during such year, including
borrowings by the Borrower as a result of draws during such year
under
letters of credit issued under the Parent Credit Agreement) or
dividends)) during such fiscal year.
"Excluded Assets" means (a) any Assets of any Excluded
Subsidiary or Excluded Entity, (b) solely with respect to the
security
interests created by the Mortgages, the Smith Facility, (c)
solely
with respect to the security interests created by the Mortgages,
the
Bingamon Creek Property (so long as the Fair Market Value of
such
property does not exceed $5,000,000) and (d) the Equity Interests
in
each of Conemaugh, Mon Synfuel, LLC, NYC Energy LLC, Allegheny
Energy
Supply Units 3, 4 and 5 LLC, AES Gleason and AES Wheatland and any
of
their respective Subsidiaries; provided, however, that in the
event
that (i) any of Conemaugh, Mon Synfuel, LLC, NYC Energy LLC,
Allegheny
Energy Supply Units 3, 4 and 5 LLC or any of their respective
Subsidiaries shall at any time individually hold Assets with a
book
value of more than $10,000,000, and (ii) the Person holding
such
Equity Interests is not restricted or prohibited by its
Constituent
Documents or any other written agreement among Persons holding
Equity
Interests in such entity from granting a Lien over such Equity
Interests in favor of the Secured Parties (unless such restriction
or
prohibition is adopted after the date hereof), then such Equity
Interests shall cease to constitute "Excluded Assets" and shall
constitute Collateral for all purposes of this Agreement and
the
Security Agreement.
"Excluded Entities" means Buchanan Generation LLC, Mon
Synfuel, LLC and NYC Energy LLC; provided, however, that each
such
Person shall cease to constitute an "Excluded Entity" in the
event
that (a) with respect to Buchanan Generation LLC and any of its
Subsidiaries, Buchanan Generation LLC shall become a direct or
indirect Subsidiary of the Borrower and (b) with respect to Mon
Synfuel, LLC, NYC Energy LLC and any of their respective
Subsidiaries,
at any time after the date hereof, such Person (i) shall
individually
hold Assets with a book value in excess of $10,000,000, (ii) is
not
restricted or prohibited by its Constituent Documents or any
other
written agreement among the Persons holding Equity Interests
therein
from granting a Lien over its Assets in favor of the Secured
Parties
(unless such restriction or prohibition is adopted after the
date
hereof) and (iii) shall become a direct or indirect Subsidiary of
the
Borrower.
"Excluded Subsidiaries" means each of AGC, Conemaugh,
Allegheny Energy Supply Units 3, 4, 5 LLC, AES Gleason and AES
Wheatland and each of their respective Subsidiaries; provided,
however, that, except with respect to AES Gleason and AES
Wheatland,
each such Subsidiary shall cease to constitute an "Excluded
Subsidiary" in the event that (a) with respect to AGC, AGC shall
no
longer be restricted or prohibited under any agreement for Debt
for
Borrowed Money permitted to exist or be incurred pursuant to the
terms
of this Agreement from granting a Lien over its Assets in favor of
the
Secured Parties and (b) with respect to Conemaugh, Allegheny
Energy
Supply Units 3, 4, 5 LLC and any of their respective Subsidiaries,
at
any time after the date hereof, such Person (i) shall
individually
hold Assets with a book value in excess of $10,000,000 and (ii) is
not
restricted or prohibited by its Constituent Documents or any
other
written agreement among the Persons holding Equity Interests
therein
from granting a Lien over its Assets in favor of the Secured
Parties
(unless such restriction or prohibition is adopted after the
date
hereof).
"Existing Credit Agreement" has the meaning specified in
Preliminary Statement (1) to this Agreement.
"Existing Debt" means all Debt, as of the date hereof, of the
Borrower and its Subsidiaries.
"Existing Indentures" means (a) the Indenture dated March 15,
2001 between the Borrower, as issuer, and Bank One Trust
Company,
N.A., as trustee and (b) the Indenture dated as of April 8,
2002
between the Borrower, as issuer, and Bank One Trust Company, N.A.,
as
trustee.
"Existing Lenders" has the meaning specified in Preliminary
Statement (1) to this Agreement.
"Facility" means, at any time, the aggregate amount of the
Commitments at such time.
"Fair Market Value" means with respect to any Asset the price
at which a willing buyer would purchase such Asset from a
willing
seller, assuming that both buyer and seller are rational and
have
reasonable knowledge of all relevant facts.
"Federal Funds Rate" means, for any period, a fluctuating
interest rate per annum equal for each day during such period to
the
weighted average of the rates on overnight Federal funds
transactions
with members of the Federal Reserve System arranged by Federal
funds
brokers, as published for such day (or, if such day is not a
Business
Day, for the next preceding Business Day) by the Federal Reserve
Bank
of New York, or, if such rate is not so published for any day that
is
a Business Day, the average of the quotations for such day for
such
transactions received by the Administrative Agent from three
Federal
funds brokers of recognized standing selected by it.
"Fee Letters" means, collectively, (a) any fee letter between
the Borrower and any Agent and (b) any fee letter among the
Borrower,
the Parent and any Arranger Party.
"Financing Documents" means this Agreement, the Notes, the
Fee Letters and the Collateral Documents.
"First Lien Secured Debt Leverage Ratio" means, at any date
of determination, the ratio of Consolidated First Lien Secured Debt
of
the Borrower and its Subsidiaries outstanding as of such date
of
determination to Consolidated EBITDA of the Borrower and its
Subsidiaries for the most recently completed fiscal year.
"Fiscal Year" means a fiscal year of the Borrower and its
Consolidated Subsidiaries ending on December 31 in any calendar
year.
"Form 10-K" has the meaning specified in Section 4.01(h).
"Fund" means any Person (other than a natural person) that is
(or will be) engaged in making, purchasing, holding or
otherwise
investing in commercial loans and similar extensions of credit in
the
ordinary course of its business.
"GAAP" has the meaning specified in Section 1.02(c).
"Governmental Approvals" has the meaning specified in Section
4.01(d).
"Governmental Authority" means any national, state, county,
city, town, village, municipal or other de jure or de facto
government
department, commission, board, bureau, agency, authority or
instrumentality of a country or any political subdivision thereof
or
any regional transmission authority organized pursuant to federal
law,
and any Person exercising executive, legislative, judicial,
regulatory
or administrative functions of or pertaining to any of the
foregoing
entities, including all commissions, boards, bureaus, arbitrators
and
arbitration panels, and any authority or other Person controlled
by
any of the foregoing.
"Granting Lender" has the meaning specified in Section
9.07(g).
"Group Assets" means all Assets of the Loan Parties other
than the Excluded Assets.
"Hatfield's Ferry Facility" means the Hatfield's Ferry
generation facility located near Masontown, PA and owned by the
Borrower and MPC.
"Hazardous Materials" means (a) petroleum or petroleum
products, by-products or breakdown products, radioactive
materials,
asbestos-containing materials, polychlorinated biphenyls and radon
gas
and (b) any other chemicals, materials or substances
designated,
classified or regulated as hazardous or toxic or as a pollutant
or
contaminant under any Environmental Law.
"Hedge Agreements" means (a) any and all rate swap
transactions, basis swaps, credit derivative transactions,
forward
rate transactions, commodity swaps, commodity options, forward
commodity contracts, equity or equity index swaps or options, bond
or
bond price or bond index swaps or options or forward bond or
forward
bond price or forward bond index transactions, interest rate
options,
forward foreign exchange transactions, cap transactions, floor
transactions, collar transactions, currency swap transactions,
cross-currency rate swap transactions, currency options, spot
contracts, or any other similar transactions or any combination of
the
foregoing (including any option to enter into any of the
foregoing),
whether or not any such transaction is governed by or subject to
any
master agreement, and (b) any and all transactions of any kind,
and
the related
confirmations, which are subject to the terms and
conditions of, or are governed by, any form of master agreement
published by the International Swaps and Derivative Association,
Inc.,
any International Foreign Exchange Master Agreement or any
other
master agreement (including such master agreement, together with
any
related schedules, a "Master Agreement") including any such
obligations or liabilities under any Master Agreement.
"Hunlock Agreement" means the Partnership Agreement of
Hunlock Creek Energy Ventures, dated December 8, 2000 and amended
on
June 26, 2003, between UGI and Allegheny Energy Supply Hunlock
Creek,
LLC.
"Hunlock Transaction" means the transactions to be entered
into by the Borrower or any of its Subsidiaries in connection
with
either (a) the exercise or expected exercise of a certain put
option
by UGI under the Hunlock Agreement that will require AESC
Hunlock
Creek or any Affiliate thereof to purchase from Hunlock Creek
Energy
Ventures, an equal partnership between UGI and AESC Hunlock Creek
(the
"Hunlock Partnership"), a 48 MW coal fired steam electric
generation
facility known as the Hunlock Creek Electric Generating Station
located in Hunlock Township, Commonwealth of Pennsylvania (the
"Hunlock Coal Station"), a 44 MW combustion turbine electric
generation facility located at the same site (the "Hunlock CT"),
or
both or (b) the exercise or expected exercise of a certain call
option
by AESC Hunlock Creek or any Affiliate thereof under the
Hunlock
Agreement that will allow AESC Hunlock Creek or such Affiliate
to
purchase from the Hunlock Partnership the Hunlock Coal Station,
the
Hunlock CT or both.
"Incremental Commitments" has the meaning specified in
Section 2.14(a).
"Indemnified Costs" has the meaning specified in Section
8.05(a).
"Indemnified Party" has the meaning specified in Section
9.04(b).
"Initial Lenders" has the meaning specified in the recital of
parties to this Agreement.
"Insolvency Proceeding" means, with respect to any Person,
(a) any proceeding instituted against such Person seeking to
adjudicate it a bankrupt or insolvent, or seeking liquidation,
winding
up, reorganization,
arrangement, adjustment, protection, relief, or
composition of it or its debts under any law relating to
bankruptcy,
insolvency or reorganization or relief of debtors, or seeking
the
entry of an order for relief or the appointment of a receiver,
trustee
or other similar official for it or for any substantial part of
its
property and either such proceeding shall remain undismissed or
unstayed for a period of 60 consecutive days or the entry by
any
competent Governmental Authority of any jurisdiction or a court
having
jurisdiction in the premises of a decree or order approving or
ordering any of the actions sought in such proceeding (including
the
entry of an order for relief against, or the appointment of a
receiver, trustee, custodian or other similar official for, it or
any
substantial part of its property); or (b) commencement by such
Person
of a voluntary case or proceeding under any applicable
bankruptcy,
insolvency, reorganization or other similar law or of any other
case
or proceeding to be adjudicated as bankrupt or insolvent, or
the
consent by such Person to the entry of a decree or order for relief
in
respect of such Person in an involuntary case or proceeding under
any
applicable bankruptcy, insolvency, reorganization or other similar
law
or to the commencement of any bankruptcy or insolvency case or
proceeding against such Person, or the filing by such Person of
a
petition or answer or consent seeking reorganization or relief
under
any Applicable Law; or consent by such Person to the filing of
such
petition or to the appointment of or taking possession by a
custodian,
receiver, liquidator, assignee, trustee, sequestrator or other
similar
official of such Person or of any substantial part of the property
of
such Person, or the making by such Person of an assignment for
the
benefit of creditors or any other marshalling of the assets and
liabilities of such Person, or the admission by such Person in
writing
of its inability to pay its debts generally as they become due, or
the
taking of corporate action by such Person in furtherance of any
such
action.
"Intercreditor Agent" has the meaning specified in the
recital of the parties to this Agreement.
"Intercreditor Agreement" means that certain Intercreditor
Agreement, dated as of February 21, 2003, among Citibank, N.A.,
as
agent for certain lenders described therein and intercreditor
agent,
The Bank of Nova Scotia, as agent for certain lenders described
therein, Law Debenture Trust Company of New York, as indenture
trustee, the Parent and the Borrower.
"Interest Coverage Ratio" means, at any date of
determination, the ratio of (a) Consolidated EBITDA for the period
of
four consecutive fiscal quarters most recently ended on or prior
to
such date, taken as one accounting period to (b) the
Consolidated
Interest Expense for the period of four consecutive fiscal
quarters
most recently
ended on or prior to such date, taken as one accounting
period.
"Interest Period" means, for each Eurodollar Rate Advance,
the period commencing on the date of such Eurodollar Rate Advance
or
the date of the Conversion of any Base Rate Advance into such
Eurodollar Rate Advance, as the case may be, and ending on the
last
day of the period selected by the Borrower pursuant to the
provisions
below for such Eurodollar Rate Advance and, thereafter, each
subsequent period commencing on the last day of the immediately
preceding Interest Period and ending on the last day of the period
so
selected by the Borrower pursuant to the provisions below. The
duration of each such Interest Period shall be one, two, three or
six
months or, if available at the time of selection to all Lenders,
nine
or twelve months, as the Borrower may select, upon notice received
by
the Administrative Agent not later than 11:00 a.m. (New York
City
time) on the third Business Day prior to the first day of such
Interest Period (or in the case of any Conversion of any Base
Rate
Advance into a Eurodollar Rate Advance requested to occur within
three
Business Days after the Closing Date in accordance with Section
2.03(b), upon notice received by the Administrative Agent by such
time
and with such shorter prior notice as may be agreed by the
Administrative Agent); provided, however, that:
(a) the Borrower may not select any Interest Period
with respect to any Eurodollar Rate Advance that ends after
the date specified in clause (a) of the definition of
"Maturity Date";
(b) whenever the last day of any Interest Period
would otherwise occur on a day other than a Business Day, the
last day of such Interest Period shall be extended to occur
on the next succeeding Business Day, provided, however, that,
if such extension would cause the last day of such Interest
Period to occur in the next following calendar month, the
last day of such Interest Period shall occur on the next
preceding Business Day; and
(c) whenever the first day of any Interest Period
occurs on a day of an initial calendar month for which there
is no numerically corresponding day in the calendar month
that succeeds such initial calendar month by the number of
months equal to the number of months in such Interest Period,
such Interest Period shall end on the last Business Day of
such succeeding calendar month.
"Intralinks" means the digital internet workspace located at
http://www.intralinks.com.
"Investment" in any Person means any loan or advance to such
Person, any purchase or other acquisition of any Equity Interests
or
Debt or the Assets comprising a division or business unit or a
substantial part or all of the business of such Person, any
capital
contribution to such Person or any other direct or indirect
investment
in such Person, including any acquisition by way of a merger or
consolidation and any arrangement pursuant to which the
investor
incurs Debt of the types referred to in clause (j) or (k) of
the
definition of "Debt" in respect of such Person.
"Joint Venture" means, with respect to any Person, at any
date, any other Person in whom such Person directly or
indirectly
holds an Investment consisting of an Equity Interest and whose
financial results would not be considered under GAAP with the
financial results of such Person on the Consolidated financial
statements of such Person, if such statements were prepared in
accordance with GAAP as of such date.
"Lenders" means the Initial Lenders and each other Person
that shall become a Lender hereunder pursuant to Section 9.07 for
so
long as such Initial Lender or Person, as the case may be, shall be
a
party to this Agreement.
"Leverage Ratio" means, as of any date of determination, the
ratio of (a) Consolidated Debt for Borrowed Money of the Borrower
as
at such date, to (b) Consolidated EBITDA for the period of four
consecutive fiscal quarters most recently ended on or prior to
such
date, taken as one accounting period.
"LIBOR" means, for any
applicable Interest Period with
respect to any Eurodollar Rate Advance (or portions thereof) with
the
same Interest Period, the British Bankers' Association Interest
Settlement Rate per annum for deposits in Dollars for a period
equal
to such Interest Period appearing on the display designated as
Page
3750 on the Dow Jones Markets Service (or such other page on
that
service or such other service designated by the British
Bankers'
Association for the display of such Association's Interest
Settlement
Rates for Dollar deposits) as of 11:00 a.m. (London, England time)
on
the day that is two Business Days prior to the first day of the
Interest Period or, if such Page 3750 is unavailable for any reason
at
such time, the rate which appears on the Reuters Screen LIBOR01
Page
as of such date and such time; provided that if the
Administrative
Agent determines that the relevant foregoing sources are
unavailable
for the relevant Interest Period, "LIBOR" shall mean the rate
of
interest determined by the Administrative Agent to be the
average
(rounded upward, if necessary, to the nearest 1/1000th of 1%) of
the
rates per annum at which deposits in Dollars are offered to the
Administrative Agent two Business Days preceding the first day of
such
Interest Period by leading banks in the London interbank market as
of
10:00 a.m. (New York City time) for delivery on the first day of
such
Interest Period, for the number of days comprised therein and in
an
amount comparable to the amount of the Eurodollar Rate Advance
(or
portion thereof, as the case may be) of CNAI (in its capacity as
a
Lender).
"Lien" means any lien, mortgage, deed of trust, pledge,
security interest or other charge or encumbrance of any kind,
including the lien or retained security title of a conditional
vendor
and any easement, right of way or other encumbrance on title to
real
property.
"Loan Party" has the meaning specified in the recital of the
parties hereto.
"Margin Stock" has the meaning specified in Regulation U.
"Master Agreement" has the meaning specified in the
definition of the term "Hedge Agreements".
"Material Adverse Change" means any material adverse change
in the business, financial condition, operations or properties of
the
Borrower and its Subsidiaries, taken as a whole.
"Material Adverse Effect" means a material adverse effect on
(a) the business, financial condition, operations or properties of
the
Borrower and its Subsidiaries, taken as a whole, (b) the rights
and
remedies of any Secured Party under any Financing Document, or (c)
the
ability of any Loan Party to perform its Obligations under any
Financing Document to which it is or is to be a party.
"Material Contracts" means (a) the Affiliate Energy
Contracts, (b) the Operating Agreements, (c) the Tax Allocation
Agreement and (d) each contract or agreement entered into after
March
8, 2004 to which the Borrower or any of its Subsidiaries is a
party
which is material to the business, financial condition, operations
or
properties of the Borrower or the Borrower and its Subsidiaries,
taken
as a whole, and for which breach, non-performance, cancellation
or
failure to renew could be reasonably expected to have a
Material
Adverse Effect.
"Material Governmental Approvals" means those Governmental
Approvals listed in Part A of Schedule 4.01(d).
"Material Property" means such real property of any Loan
Party (other than Excluded Assets), which real property (a) has a
book
value greater than or equal to $5,000,000 (including any such
real
property acquired in connection with a Permitted Asset Swap), (b)
is
subject to a Mortgage or (c) is otherwise material to the value of
any
real property of any Loan Party which is subject to a Lien under
the
Mortgages.
"Maturity Date" means the earlier of (a) March 8, 2011 and
(b) the date of acceleration of all outstanding Advances pursuant
to
Section 6.02.
"Merrill Lynch Litigation" means that litigation arising out
of that complaint filed under the caption Merrill Lynch & Co.,
Inc.,
et al v. Allegheny Energy, Inc. and Allegheny Energy, Inc. et al.
v.
Merrill Lynch & Co., Inc., et al. (02 CV 7689 (HB)).
"ML Interests" means the up to 2% of all issued and
outstanding Equity Interests in the Borrower which are owned by ML
IBK
Positions, Inc, a Delaware corporation.
"Moody's" means Moody's Investors Service, Inc.
"Mortgages" means the Term Mortgages, the Amended and
Restated Mortgages, the New Mortgages and any other mortgage, deed
of
trust, trust deed, leasehold mortgage or leasehold deed of
trust
recorded and filed with any necessary recording office from time
to
time in order to create a valid Lien over the Collateral in favor
of
the Secured Parties in respect of the Secured Obligations owed to
such
Secured Parties pursuant to the terms of this Agreement or the
Security Agreement.
"MPC" means Monongahela Power Company, a corporation
incorporated under the laws of the State of Ohio.
"Multiemployer Plan" means a multiemployer plan, as defined
in Section 4001(a)(3) of ERISA, to which the Borrower or any of
its
Subsidiaries or any ERISA Affiliate is making or accruing an
obligation to make contributions, or has within any of the
preceding
five plan years made or accrued an obligation to make
contributions.
"Multiple Employer Plan" means a single employer plan, as
defined in Section 4001(a)(15) of ERISA, that (a) is maintained
for
employees of the Borrower or any of its Subsidiaries or any
ERISA
Affiliate and at least one Person other than the Borrower, its
Subsidiaries and the ERISA Affiliates or (b) was so maintained and
in
respect of which the Borrower and any of its Subsidiaries or any
ERISA
Affiliate could have liability under Section 4064 or 4069 of ERISA
in
the event such plan has been or were to be terminated.
"Net Cash Proceeds" means, with respect to any sale, lease,
transfer or other disposition of any Assets or any Debt Issuance
or
the sale or issuance of any Equity Interests (including any
capital
contribution) by any Person, the aggregate amount of cash
received
from time to time (whether as initial consideration or through
payment
or disposition of deferred consideration or received from escrow)
by
or on behalf of such Person in connection with such transaction
after
deducting therefrom only (without duplication) the following (to
the
extent directly and primarily relating to such transaction):
(a)
reasonable and customary brokerage commissions, underwriting fees
and
discounts, legal, consultant and advisor fees, finder's fees and
other
similar fees and
commissions, (b) the amount of taxes (or amounts
owing pursuant to the Tax Allocation Agreement) payable in
connection
with or as a result of such transaction, and (c) in the case of
any
sale, lease, transfer or other disposition of any Asset, (i)
the
amount of (A) any Debt secured by a prior Lien on the Asset which
is
the subject of such sale, lease, transfer or other disposition or
(B)
Debt outstanding under the Pollution Control Bonds that is, in
either
case, repaid, redeemed or defeased upon such disposition as
required
pursuant to the terms of (1) the agreement or instrument
governing
such Debt or (2) any undertaking or agreement of the Borrower made
on
or prior to February 21, 2003 in favor of the issuer of any
guaranty,
surety bond or insurance policy issued for the benefit of the
holders
of such Debt, including each of the consents, dated February 21,
2003,
entered into among (y) the Borrower, PEC and MBIA Insurance
Corporation and (z) the Borrower, WPPC and MBIA Insurance
Corporation,
(ii) the costs associated (in the Borrower's best estimate)
with
terminating all Hedge Agreements, if any, entered into in
connection
with such Asset, which Hedge Agreements are not being transferred
as
part of such sale, lease, transfer or other disposition, but only
to
the extent that the amounts so deducted are, at the time or within
a
reasonable time (not to exceed ten days) of receipt of such
cash,
actually paid to a Person that is not an Affiliate of such Person
or
any Loan Party or any Affiliate of any Loan Party and are
properly
attributable to such transaction or to the Asset that is the
subject
thereof and (iii) any amounts received from funds that were held
in
escrow as of the Closing Date with respect to any sale, lease,
transfer or other disposition of any Asset consummated prior to
the
Closing Date; provided, that, in the case of taxes or
termination
costs that are deductible under clause (b) or (c)(ii) above but
for
the fact that, at the time of receipt of such cash, such amounts
have
not been actually paid or are not then payable, such Person may
deduct
an amount (the "Reserved Amount") equal to the amount reserved
in
accordance with GAAP for such Person's reasonable estimate of
such
amounts, other than taxes for which such Person is indemnified;
provided further that, at the time such amounts are paid, an
amount
equal to the amount, if any, by which the Reserved Amount for
such
amounts exceeds the amount of such amounts actually paid shall
constitute "Net Cash Proceeds" of the type for which such amounts
were
reserved for all purposes hereunder.
"New Mortgages" has the meaning specified in Section 5.01(p).
"Non-UCC Property" means any of the Collateral consisting of
personal property the creation, granting or perfection of a Lien
upon
or in which is governed by Applicable Law other than the UCC
and
Applicable Law under, or relating to, the UCC.
"Note" means a promissory note of the Borrower payable to the
order of a Lender and issued pursuant to the terms hereof,
evidencing
the aggregate indebtedness of the Borrower owed to such Lender
resulting from the Advances made, continued or maintained by
such
Lender pursuant to this Agreement.
"Notice of Bank Facility Default" has the meaning specified
in Section 7.01(a)(2).
"Notice of Borrowing" has the meaning specified in Section
2.02(a).
"Notice of Conversion/Continuation" has the meaning specified
in Section 2.03(b).
"Notice of Default" has the meaning specified in Section
7.01(a).
"NPL" means the National Priorities List under CERCLA.
"Obligation" means, with respect to any Person, any payment,
performance or other obligation of such Person of any kind,
including
any liability of such Person on any claim, whether or not the right
of
any creditor to payment in respect of such claim is reduced to
judgment, liquidated, unliquidated, fixed, contingent, matured,
disputed, undisputed, legal, equitable, secured or unsecured,
and
whether or not such claim is discharged, stayed or otherwise
affected
by any proceeding referred to in Section 6.01(h). Without limiting
the
generality of the foregoing, the Obligations of any Loan Party
under
the
Financing Documents include (a) the obligation to pay
principal,
interest, commissions, charges, expenses, fees, attorneys' and
consultants' fees and disbursements, indemnities and other
amounts
payable by such Loan Party under any Financing Document and (b)
the
obligation of such Loan Party to reimburse any amount in respect
of
any of the foregoing that any Secured Party, in its sole
discretion,
may elect to pay or advance on behalf of such Loan Party.
"Officer's Certificate" means, with respect to any Person, a
certificate signed by a Responsible Officer of such Person.
"Operating Account Bank" means an institution at which an
Operating Account has been established as specified in Part B
of
Schedule 1.01(c).
"Operating Accounts" means all those deposit and securities
accounts of the Borrower and the other Loan Parties set forth in
Part
B of Schedule 1.01(c).
"Operating Agreements" means each of the agreements set forth
on Schedule 1.01(d) hereto.
"Other Perfection Requirements" means (a) the giving of
notice to any Person (other than an Affiliate of the Borrower or
an
Operating Account Bank) of the Liens created by the Loan Parties
under
the Collateral Documents and (b) any recording, notice, filing,
registration, instrument or act required to be undertaken, made
or
executed in order to grant or perfect any Lien over Non-UCC
Property.
"Other Taxes" has the meaning specified in Section 2.12(b).
"PA Report" means the Independent Market Expert's Report for
the PJM, MISO, and SERC-TVA Regions, dated June 24, 2005, prepared
by
PA Consulting Group.
"Parent" means Allegheny Energy, Inc., the parent company of
the Borrower.
"Parent Credit Agreement" means that certain Credit
Agreement, dated as of June 16, 2005, among the Parent, the
Borrower,
the Lenders and Issuing Bank party thereto, and CNAI, as
Administrative Agent.
"PBGC" means the Pension Benefit Guaranty Corporation (or any
successor).
"PEC" means The Potomac Edison Company, a corporation
incorporated under the laws of the State of Maryland and of the
State
of Virginia.
"PEC Service Agreement" means that certain Service Agreement,
dated as of August 1, 2000, between the Borrower and PEC (d/b/a
Allegheny Power).
"Permitted Asset Swap" has the meaning specified in Section
5.02(e)(ix).
"Permitted Liens" means such of the following as to which no
enforcement, collection, execution, levy or foreclosure
proceeding
shall have been commenced: (a) Liens for taxes, assessments and
governmental charges or levies to the extent not required to be
paid
under Section 5.01(d); (b) Liens imposed by law, such as
materialmen's, mechanics', carriers', workmen's and repairmen's
Liens
and other similar Liens arising in the ordinary course of
business
securing obligations
that are not overdue for a period of more than 30
days, or which are subject to Contest; (c) Liens or deposits to
secure
obligations under workers' compensation laws or similar legislation
or
to secure public or statutory obligations; (d) deposits to secure
the
performance of bids, leases (other than Capitalized Leases),
trade
contracts, public or statutory obligations (including
environmental,
municipal and public utility commission obligations under
Applicable
Law), surety bonds (other than bonds related to judgments or
litigation), performance bonds and other obligations of a like
nature;
(e) Liens securing judgments for the payment of money not
constituting
an Event of Default under Section 6.01(i) or securing appeal or
other
surety bonds related to such judgments; (f) zoning
restrictions,
easements, rights of way and other encumbrances on title to
real
property that do not render title to the property encumbered
thereby
unmarketable or materially adversely affect the use of such
property
for its present purposes; (g) Liens securing reimbursement
obligations
with respect to letters of credit (which reimbursement
obligations
relate to Debt which has not been incurred in contravention of
the
terms of this Agreement and the other Financing Documents) that
encumber documents and other property relating to such letters
of
credit and the proceeds and products thereof, including such
Liens
arising in connection with the issuance of letters of credit on
behalf
of the Parent to support obligations of the Borrower and its
Subsidiaries under Hedge Agreement to the extent that such
Hedge
Agreements are entered into in accordance with the terms of
this
Agreement; (h) Liens on cash deposits in the nature of a right
of
setoff, banker's lien, counterclaim or netting of cash amounts
owed
arising in the ordinary course of business on deposit accounts,
commodity accounts or securities accounts; (i) financing
statements
filed on a precautionary basis in respect of operating leases to
the
extent such lease is otherwise permitted under the terms of
this
Agreement; provided that no such financing statement extends to
or
refers to as collateral any Assets which are not subject to
such
operating lease; and (j) rights of first refusal, options or
other
contractual rights or obligations to sell, assign or otherwise
dispose
of any Asset or interest therein which rights of first refusal,
option
or contractual right is in connection with a sale, transfer or
other
disposition of Assets permitted under Section 5.02(d) or
5.02(e).
"Permitted Refinancing Debt" means Debt issued or incurred
(including by means of the extension or renewal of existing Debt)
to
refinance, refund, extend, renew or replace existing Debt
("Refinanced
Debt") concurrently with or within 90 days after, the issuance
or
incurrence of such Debt; provided that (a) the principal amount
of
such refinancing, refunding, extending, renewing or replacing Debt
is
not greater than the principal amount of such Refinanced Debt plus
the
amount of any premiums or penalties and accrued and unpaid
interest
paid thereon and reasonable fees and expenses, in each case
associated
with such refinancing, refunding, extension, renewal or
replacement,
(b) such refinancing, refunding, extending, renewing or replacing
Debt
has a final maturity date that is no sooner than, and a
weighted
average life to maturity that is no shorter than, such
Refinanced
Debt, (c) if such Refinanced Debt is subordinated to the
Secured
Obligations hereunder, such refinancing, refunding, extending,
renewing or replacing Debt remains so subordinated on terms no
less
favorable to the Lenders, (d) the obligors in respect of such
Refinanced Debt immediately prior to such refinancing,
refunding,
extending, renewing or replacing and any additional person (other
than
a Loan Party) are the only obligors on such refinancing,
refunding,
extending, renewing or replacing Debt and (e) such refinancing,
refunding, extending, renewing or replacing Debt contains
covenants
and events of default which, taken as a whole, are determined in
good
faith by a Responsible Officer of the Borrower to be customary
for
similar issuances of Debt by issuers of a similar credit rating
or
standing as the credit rating then applicable to the Borrower.
"Person" means an individual, partnership, corporation
(including a business or statutory trust), limited liability
company,
joint stock company, trust, unincorporated association, joint
venture
or other entity, or a government or any political subdivision
or
agency thereof.
"Plan" means a Single-Employer Plan or a Multiple Employer
Plan.
"Platform" has the meaning specified in Section 9.02(c).
"Pledged Account" means any deposit or securities account
maintained in the name of the Collateral Agent and under the
sole
control and dominion of the Collateral Agent pursuant to the terms
of
the Security Agreement.
"Pledged Debt" has the meaning set forth in the Security
Agreement.
"PNC Control Agreement" means that certain Deposit Account
Control Agreement, dated as of February 21, 2003, among PNC
Bank,
National Association, as the Bank, the Borrower, Energy
Financing
Company, LLC, Allegheny Energy Supply Capital, LLC, Allegheny
Energy
Supply Development Services, LLC, Allegheny Energy Supply
Capital
Midwest, LLC, Allegheny Energy Supply Gleason Generating
Facility,
LLC, Allegheny Energy Supply Wheatland Generating Facility,
LLC,
Allegheny Energy Supply Lincoln Generating Facility, LLC and
Allegheny
Trading Finance Company, LLC, as Debtors, and the Collateral Agent,
as
Creditor.
"Pollution Control Bond Indentures" means (a) the Trust
Indenture dated as of April 15, 1992 between the County Commission
of
Harrison County, West Virginia and J.P. Morgan Trust Company,
National
Association (formerly Chase Manhattan Trust Company, National
Association, successor trustee to Mellon Bank, N.A.), as
Trustee,
providing for Solid Waste Disposal Revenue Bonds (West Penn
Power
Company Harrison Station Project), (b) the Trust Indenture dated as
of
November 1, 1977 between Pleasants County, West Virginia and
J.P.
Morgan Trust Company, National Association (formerly Chase
Manhattan
Trust Company, National Association, successor trustee to Mellon
Bank,
N.A.), as Trustee, providing for Pollution Control Revenue Bonds
(West
Penn Power Company Pleasants Station Project), (c) the Trust
Indenture
dated as of December 1, 1980 between Washington County
Industrial
Development Authority and J.P. Morgan Trust Company, National
Association (formerly Chase Manhattan Trust Company, National
Association, successor trustee to Mellon Bank, N.A.), as
Trustee,
providing for Pollution Control Revenue Bonds (West Penn Power
Company
Mitchell Station Project), (d) the Trust Indenture dated as of
April
15, 1983 between the County Commission of Monongalia County,
West
Virginia and J.P. Morgan Trust Company, National Association
(formerly
Chase Manhattan Trust Company, National Association, successor
trustee
to Mellon Bank, N.A.), as Trustee, providing for Pollution
Control
Revenue Bonds (West Penn Power Company Fort Martin Station
Project),
(e) the Trust Indenture dated as of February 1, 1977 between
Greene
County Industrial Development Authority and J.P. Morgan Trust
Company,
National Association (formerly Chase Manhattan Trust Company,
National
Association, successor trustee to Mellon Bank, N.A.), as
Trustee,
providing for Pollution Control Revenue Bonds (West Penn Power
Company
Hatfield's Ferry Project), (f) the Trust Indenture dated as of
April
15, 1992 between
the County Commission of Harrison County, West
Virginia and J.P. Morgan Trust Company, National Association
(formerly
Chase Manhattan Trust Company, National Association, successor
trustee
to Mellon Bank, N.A.), as Trustee, providing for Solid Waste
Disposal
Revenue Bonds (The Potomac Edison Company Harrison Station
Project),
(g) the Trust Indenture dated as of November 1, 1977 between
Pleasants
County, West Virginia and J.P. Morgan Trust Company, National
Association (formerly Chase Manhattan Trust Company, National
Association, successor trustee to Mellon Bank, N.A.), as
Trustee,
providing for Pollution Control Revenue Bonds (The Potomac
Edison
Company Pleasants Station Project), (h) the Trust Indenture dated
as
of April 15, 1983 between the County Commission of Monongalia
County,
West Virginia and J.P. Morgan Trust Company, National
Association
(formerly Chase Manhattan Trust Company, National Association,
successor trustee to Mellon Bank, N.A.), as Trustee, providing
for
Pollution Control Revenue Bonds (The Potomac Edison Company
Fort
Martin Station Project), (i) the Trust Indenture dated as of
February
1, 1977 between Greene County Industrial Development Authority
and
J.P. Morgan Trust Company, National Association (formerly Chase
Manhattan Trust Company, National Association, successor trustee
to
Mellon Bank, N.A.), as Trustee, providing for Pollution Control
Revenue Bonds (Monongahela Power Company Hatfield's Ferry
Project),
(j) the Trust Indenture dated as of November 1, 1977 between
Pleasants
County, West Virginia and J.P. Morgan Trust Company, National
Association (formerly Chase Manhattan Trust Company, National
Association, successor trustee to Mellon Bank, N.A.), as
Trustee,
providing for Pollution Control Revenue Bonds (Monongahela
Power
Company Pleasants Station Project), (k) the Trust Indenture dated
as
of April 15, 1983 between the County Commission of Monongalia
County,
West Virginia and J.P. Morgan Trust Company, National
Association
(formerly Chase Manhattan Trust Company, National Association,
successor trustee to Mellon Bank, N.A.), as Trustee, providing
for
Pollution Control Revenue Bonds (Monongahela Power Company Fort
Martin
Station Project), and (l) Trust Indenture dated as of April 15,
1992
between the County Commission of Harrison County, West Virginia
and
J.P. Morgan Trust Company, National Association (formerly Chase
Manhattan Trust Company, National Association, successor trustee
to
Mellon Bank, N.A.), as Trustee, providing for Solid Waste
Disposal
Revenue Bonds (Monongahela Power Company Harrison Station
Project).
"Pollution Control Bonds" means all notes, bonds and other
instruments evidencing Debt issued pursuant to the Pollution
Control
Bond Indentures.
"Preferred Interests" means, with respect to any Person,
Equity Interests issued by such Person that are entitled to a
preference or priority over any other Equity Interests issued by
such
Person upon any distribution of such Person's Assets, whether
by
dividend or upon liquidation.
"Prepayment Account" has the meaning set forth in the
Security Agreement.
"Prepayment Date" has the meaning specified in Section
2.06(c)(ii).
"Prepayment Notice" has the meaning specified in Section
2.06(c)(ii).
"PUHCA" means the Public Utility Holding Company Act of 1935,
as amended.
"Qualifying Obligation" means an Obligation in an aggregate
principal amount in excess of $5,000,000.
"Quarterly Date" means the last Business Day of March, June,
September and December, commencing with September 30, 2005.
"Real Property Requirements" means the requirements contained
in Exhibit F with respect to the creation and perfection of any
Lien
over any of the real property of any Loan Party which is subject to
a
prior Mortgage.
"Receipt Date" has the meaning specified in Section
2.06(c)(ii).
"Recorded Term Mortgages" has the meaning specified in
Section 5.01(p).
"Recovery Event" means (a) any act, series of acts, omissions
or series of omissions of any Governmental Authority for the
confiscation, condemnation, expropriation, nationalization, seizure
or
other taking of any Asset of any Loan Party or (b) any event
that
causes any Asset (or portion thereof) of any Loan Party to be
damaged,
destroyed or rendered unfit for normal use for any reason
whatsoever.
"Recovery Event Proceeds" means the amount of cash proceeds
paid to any Loan Party in respect of any Recovery Event but
excluding
any such proceeds paid under any advance loss of profit
insurance,
delayed start-up insurance, liability, business interruption or
similar types of insurance.
"Redeemable" means, with respect to any Equity Interest, any
Debt or any other right or Obligation, any such Equity Interest,
Debt,
right or Obligation that (a) the issuer has undertaken to redeem at
a
fixed or determinable date or dates, whether by operation of a
sinking
fund or otherwise, or upon the occurrence of a condition not
solely
within the control of the issuer or (b) is redeemable at the option
of
the holder.
"Register" has the meaning specified in Section 9.07(d).
"Regulation U" means Regulation U of the Board of Governors
of the Federal Reserve System, as in effect from time to time.
"Related Fund" means, with respect to any Lender or Eligible
Assignee that is a Fund, any other Fund that is administered or
managed by the same Person as such Lender or Eligible Assignee or
by
an Affiliate of such Person.
"Representatives" has the meaning specified in Section
9.12(a).
"Required Lenders" means, at any time, Lenders owed or
holding at least a majority in interest of the sum of the
aggregate
principal amount of all Advances outstanding at such time or, if
no
such principal amount is outstanding at such time, Lenders holding
at
least a majority in interest of the aggregate amount of the
Commitments and the Incremental Commitments, if any.
"Required Prepayment Percentage" means if, on the date of the
applicable prepayment, the First Lien Secured Debt Leverage Ratio
as
of such date is (a) 3:1 or higher, 50%, (b) less than 3:1 but
higher
than or equal to 2:1, 25% or (c) less than 2:1, 0%.
"Responsible Officer" means, with respect to any Person, the
president, any vice-president, the treasurer, the chief
financial
officer or an Authorized Signatory of such Person.
"S&P" means Standard & Poor's Ratings Services, a division
of
The McGraw-Hill Companies, Inc.
"Sale" means any sale (including by way of sale/leaseback),
lease, assignment, transfer or other disposition.
"SEC" means the Securities and Exchange Commission.
"Second Draw Date" has the meaning specified in Section
3.02(a).
"Second Draw Date Transactions" has the meaning specified in
Section 3.02(a)(i).
"Secured Obligations" has the meaning specified in the
Security Agreement.
"Secured Party" has the meaning specified in the Security
Agreement.
"Security Agreement" means that certain Amended and Restated
Security and Intercreditor Agreement, dated as of February 21,
2003,
as amended and restated in its entirety on March 8, 2004 and as
further amended and restated in its entirety on October 28, 2004,
as
amended, restated, modified or otherwise supplemented from time
to
time in accordance with its terms, including pursuant to the
SIA
Amendment, made by and among the Borrower, the other Loan
Parties
named therein, Citicorp North America, Inc., as administrative
agent,
Law Debenture Trust Company of New York, as indenture trustee,
and
Citibank, N.A., as collateral agent, intercreditor agent and
depository bank.
"Senior Debt Obligations" means, without duplication, (a) the
Obligations of the Borrower to pay principal and interest on or
in
respect of the Advances (including any interest accruing after
the
filing of a petition with respect to, or the commencement of,
any
Insolvency Proceeding, whether or not a claim for post-petition
interest is allowed in such proceeding), and (b) any and all
commissions, fees, indemnities, prepayment premiums, costs and
expenses and other amounts payable to any Lender, any Agent or
any
Arranger Parties under any Financing Document, including all
renewals
or extensions thereof (including any reimbursement obligations
for
costs and expenses incurred by any Secured Party in preserving
any
rights, interests and remedies with respect to the Collateral
and/or
the Liens granted in favor of the Secured Parties); provided
that
notwithstanding anything to the contrary in any Financing
Document,
"Senior Debt Obligations" shall not include any Obligations of
the
Borrower owed to any of its Affiliates.
"Senior Note Indenture" means the Amended and Restated
Indenture, dated as of February 21, 2003, between the Borrower,
as
issuer, Law Debenture Trust Company, as Indenture Trustee, and
Bank
One Trust Company, N.A., in respect of the senior notes due
2007
issued thereunder.
"Senior Notes" means the Senior Secured Notes and the Senior
Unsecured B Notes.
"Senior Secured Debt Rating" means, as of any date, the
rating that has been most recently announced by either S&P or
Moody's,
as
the case may be, for any class of non-credit enhanced long-term
senior secured debt issued by the Borrower; provided that (a) if
any
rating established by S&P or Moody's shall be changed, such
change
shall be effective as of the date on which such change is first
publicly announced by the rating agency making such change, and (b)
if
S&P or Moody's shall change the basis on which ratings are
established, each reference to the Senior Secured Debt Rating
announced by S&P or Moody's, as the case may be, shall refer to
the
then equivalent rating by S&P or Moody's, as the case may
be.
"Senior Secured Notes" means those certain secured 10.25%
Senior Notes due 2007 issued by the Borrower pursuant to the terms
of
the Senior Note Indenture and designated as Amended A Notes by
the
terms thereof.
"Senior Unsecured B Notes" means those certain unsecured
10.25% Senior Notes due 2007 issued by the Borrower pursuant to
the
Senior Note Indenture and designated as Amended B Notes by the
terms
thereof.
"SIA Amendment" has the meaning specified in Section
3.01(a)(v).
"Single-Employer Plan" means a single-employer plan, as
defined in Section 4001(a)(15) of ERISA, that (a) is maintained
for
employees of the Borrower or any of its Subsidiaries or any
ERISA
Affiliate and no Person other than the Borrower or any of its
Subsidiaries and the ERISA Affiliates or (b) was so maintained and
in
respect of which the Borrower or any of its Subsidiaries or any
ERISA
Affiliate could have liability under Section 4069 of ERISA in
the
event such plan has been or were to be terminated.
"Smith Facility" means the R. Paul Smith generation facility
located in Williamsport, MD owned by the Borrower, but excluding
any
related personal property the creation, granting or perfection of
a
Lien upon or in which is governed by the UCC.
"Solvent" and "Solvency" mean, with respect to any Person on
a particular date, that on such date (a) the fair value of the
property
of such Person is greater than the total amount of
liabilities, including, without limitation, contingent
liabilities
that are probable and estimable, of such Person, (b) the present
fair
saleable value of the Assets of such Person is not less than
the
amount that will be required to pay the probable liability of
such
Person on its debts as they become absolute and matured, taking
into
account the possibility of refinancing such obligations and
selling
Assets, (c) such Person does not intend to, and does not believe
that
it will, incur debts or liabilities beyond such Person's ability
to
pay such debts and liabilities as they mature, taking into account
the
possibility of refinancing such obligations and selling Assets,
and
(d) such Person is not engaged in business or a transaction, and
is
not about to engage in business or a transaction, for which
such
Person's property would constitute an unreasonably small capital.
The
determination of whether a Person is "Solvent" and the facts
and
circumstances relating thereto (including the amount of
contingent
liabilities and actual liabilities) at any time shall be computed
in
the light of all the facts and circumstances existing at such
time.
"Subsidiary" of any Person means any corporation,
partnership, joint venture, limited liability company, trust or
estate
of which (or in which) more than 50% of (a) the issued and
outstanding
capital stock 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), (b) the interest in the capital or profits of
such
partnership, joint venture or limited liability company or (c)
the
beneficial interest in such trust or estate is at the time directly
or
indirectly owned or controlled by such Person, by such Person and
one
or more of its other Subsidiaries or by one or more of such
Person's
other Subsidiaries.
"Subsidiary Debt Default" means, with respect to any
Subsidiary of the Borrower, the failure of such Subsidiary to pay
any
principal or interest or other amounts due in respect of Debt,
when
and as the same shall become due and payable, or the occurrence of
any
other event or condition that results in any Debt of such
Subsidiary
becoming due prior to its scheduled maturity or that enables or
permits (with or without the giving of notice, lapse of time or
both)
the holder or holders of such Debt or any trustee or agent on its
or
their behalf to cause such Debt to become due, or to require
the
prepayment, repurchase, redemption or defeasance thereof, prior to
its
scheduled maturity.
"Surviving Debt" means Debt of each Loan Party and its
Subsidiaries outstanding immediately before and after giving effect
to
the Transactions.
"Tax Allocation Agreement" means the Tax Allocation
Agreement, dated as of July 1, 2003, by and among the Parent and
its
Subsidiaries.
"Taxes" means all federal, state, local or foreign income,
gross receipts, windfall profits, severance, property,
production,
sales, use, excise, franchise, employment, value added, real
estate,
withholding or similar taxes, assessments, fees, liabilities or
other
charges, together with any interest, additions or penalties
with
respect thereto and any interest in respect of such additions
or
penalties.
"Term Mortgages" means the deeds of trust, trust deeds,
mortgages, leasehold mortgages and leasehold deeds of trust set
forth
on Schedule 1.01(a) hereto.
"Termination Date" means the earlier of August 31, 2005 and
the date of termination in whole of the Commitments and
Incremental
Commitments pursuant to Section 2.04 or 6.01.
"Termination Event" means an event described in Section
4042(a) of ERISA.
"Transactions" means (a) the incurrence of Debt by the
Borrower under this Agreement and the other Financing Documents,
(b)
the effectiveness of the SIA Amendment and (c) the application of
the
proceeds of the initial Borrowing on the Closing Date to the
repayment
of the aggregate principal amount outstanding under the
Existing
Credit Agreement and the application of the proceeds of the
Borrowing
on the Second Draw Date to the repayment of the aggregate
principal
amount outstanding under the Senior Secured Notes.
"Type" refers to the distinction between Advances bearing
interest at the Base Rate and Advances bearing interest at the
Eurodollar Rate.
"UCC" or "Uniform Commercial Code" means the Uniform
Commercial Code as in effect, from time to time, in the State of
New
York; provided that if perfection or the effect of perfection
or
non-perfection or the priority of any security interest in any
Collateral is governed by the Uniform Commercial Code as in effect
in
a jurisdiction other than the State of New York, "UCC" means
the
Uniform Commercial Code as in effect from time to time in such
other
jurisdiction for purposes of the provisions hereof relating to
such
perfection, effect of perfection or non-perfection or priority.
"UGI" means UGI Hunlock Development Company.
"Unused Commitments" means, with respect to any Lender at any
time, (a) such Lender's Commitment at such time minus (b) the
aggregate principal amount of all Advances made by such Lender.
"Voting Interests" means shares of capital stock issued by a
corporation, or equivalent Equity Interests in any other Person,
the
holders of which are ordinarily, in the absence of
contingencies,
entitled to vote for the election of directors (or persons
performing
similar functions) of such Person, even if the right so to vote
has
been suspended by the happening of such a contingency.
"Withdrawal Liability" has the meaning specified in Part I of
Subtitle E of Title IV of ERISA.
"WPPC" means West Penn Power Company, a corporation
incorporated under the laws of the State of Pennsylvania.
Section 1.02 Principles of Interpretation. (a) Except to the
extent expressly provided to the contrary
in this Agreement and the Schedules
and Exhibits hereto, or to the extent that
the context otherwise requires, in
this Agreement and the Schedules and
Exhibits hereto:
(i) the table of contents and Article and Section headings
are for convenience only and shall not affect the interpretation
of
this Agreement, the Schedules and Exhibits hereto or of any
Financing
Document;
(ii) references to any document, instrument or agreement,
including any Financing Document, shall include (i) all
exhibits,
annexes, schedules, appendices or other attachments thereto and
(ii)
all documents, instruments or agreements issued or executed in
replacement thereof;
(iii) references to a document or agreement, including any
Financing Document, shall be deemed to include any amendment,
restatement, modification, supplement or replacement thereto
entered
into in accordance with the terms thereof and the terms of the
Financing Documents;
(iv) the words "include", "includes" and "including" are not
limiting;
(v) references to any Person shall include such Person's
successors and permitted assigns (and in the case of any
Governmental
Authority, any Person succeeding to such Governmental
Authority's
functions and capacities);
(vi) the words "hereof", "herein" and "hereunder" and words
of similar import when used in this Agreement, the Schedules
and
Exhibits hereto or any Financing Document shall refer to this
Agreement, the Schedules and Exhibits hereto or such Financing
Document, as the case may be, as a whole and not to any
particular
provision thereof;
(vii) references to "days" shall mean calendar days;
(viii) the singular includes the plural and the plural
includes the singular;
(ix) references to Applicable Law, generally, shall mean
Applicable Law as in effect from time to time, and references to
any
specific Applicable Law shall mean such Applicable Law, as
amended,
modified or supplemented from time to time, and any Applicable
Law
successor thereto;
(x) in the computation of periods of time from a specified
date to a later specified date, the word "from" means "from and
including" and the words "to" and "until" each mean "to but
excluding"; and
(xi) any reference in this Agreement or any other Financing
Document to an Article, Section, Schedule, Appendix or Exhibit is
to
the article or section of, or a schedule, appendix or exhibit to,
this
Agreement or such other Financing Document, as the case may be,
unless
otherwise indicated, and the Schedules, Appendices and Exhibits
to
this Agreement or any other Financing Document shall be deemed
incorporated by reference into this Agreement or such other
Financing
Document, as the case may be.
(b) This
Agreement, the Schedules and Exhibits hereto and the
other Financing Documents are the result of
negotiations among the parties
hereto and their respective counsel.
Accordingly, this Agreement, the Schedules
and Exhibits hereto and the other Financing
Documents shall be deemed the
product of all parties hereto or thereto,
as the case may be, and no ambiguity
in this Agreement, the Schedules and
Exhibits hereto or any Financing Document
shall be construed in favor of or against
any Loan Party, Agent, Arranger Party
or Lender that is a party hereto.
(c) All accounting terms used herein shall be interpreted,
all accounting determinations hereunder
shall be made, and all financial
statements required to be delivered
hereunder shall be prepared, in accordance
with generally accepted accounting
principles as in effect from time to time,
applied on a basis consistent (except for
changes concurred in by the
Borrower's independent public accountants)
with the most recent audited
consolidated financial statements of the
Borrower and its Subsidiaries
delivered to the Lenders ("GAAP"); provided
that, if the Borrower notifies the
Administrative Agent that the Borrower
wishes to amend any covenant in Section
5.03 to eliminate the effect of any change
in generally accepted accounting
principles on the operation of such
covenant (or if the Administrative Agent
notifies the Borrower that the Required
Lenders wish to amend Section 5.03 for
such purpose), then the Borrower's
compliance with such covenant shall be
determined on the basis of generally
accepted accounting principles in effect
immediately before the relevant change in
generally accepted accounting
principles became effective, until either
such notice is withdrawn or such
covenant is amended in a manner
satisfactory to the Borrower and the Required
Lenders.
Section 1.03 Determination of Material Adverse Change and
Material Adverse Effect, Etc.
Determinations of materiality generally and
determinations as to whether any fact,
event, circumstance, conditions or
occurrence constitutes (or could reasonably
be expected to constitute) a
Material Adverse Effect or a Material
Adverse Change to the extent such
determination is made by reference to the
audited financial statements of the
Borrower which are subject to a "going
concern" qualification by the Borrower's
auditors shall be made without taking into
account or giving effect to such
"going concern" opinion.
ARTICLE II
ADVANCES AND PAYMENTS
Section 2.01 The Borrowings. Each Lender hereby severally
agrees, subject to the terms and conditions
of this Agreement, to make two
advances (each, an "Advance") to the
Borrower in an aggregate amount not to
exceed such Lender's Commitment as follows:
(a) the initial such Advance shall
be made on the Closing Date (which shall
occur on any Business Day during the
period from the date hereof until the
Termination Date); provided that the
aggregate amount of all such Advances by
the Lenders shall not exceed
$738,317,051.91 and (b) the second such
Advance shall be made on any Business
Day during the period from the day next
succeeding the Closing Date up to the
date that is 60 days after the Closing
Date; provided that the aggregate amount
of all such Advances by the Lenders shall
not exceed $330,682,948.09. Each
Borrowing shall consist of Advances made
simultaneously by the Lenders ratably
according to their respective Commitments.
Amounts borrowed hereunder and
repaid or prepaid may not be
reborrowed.
Section 2.02 Making the Borrowings. (a) Each Borrowing shall
be made on notice, given not later than
10:00 a.m. (New York City time) on the
third Business Day prior to the date of the
proposed Borrowing in the case of a
Borrowing consisting of Eurodollar Rate
Advances, or on the proposed date of
such Borrowing in the case of a Borrowing
consisting of Base Rate Advances (or
9:00 a.m. (New York City time) on the
Second Draw Date if the Borrowing to be
made on such date shall consist of Base
Rate Advances), by the Borrower to the
Administrative Agent, which shall give to
each Lender prompt notice thereof by
telecopier or electronic mail. Each such
notice of a Borrowing (a "Notice of
Borrowing") shall be by telephone,
confirmed immediately in writing, or
telecopier or electronic mail, in
substantially the form of Exhibit B,
specifying therein the requested (i) date
of such Borrowing (which shall be a
Business Day), (ii) aggregate amount of
such Borrowing, (iii) Type of Advances
comprising such Borrowing and (iv) if such
Borrowing is to consist of
Eurodollar Rate Advances, initial Interest
Period therefor.
(b) With respect to each Borrowing, each Lender shall, before
12:00 noon (New York City time) on the date
thereof (or 10:00 a.m. (New York
City time) on the Second Draw Date in the
case of the Borrowing to be made on
such date), make available for the account
of its Applicable Lending Office to
the Administrative Agent at the
Administrative Agent's Account, in immediately
available funds, an amount equal to such
Lender's ratable portion of such
Borrowing in accordance with the respective
Commitments of such Lender and the
other Lenders. After the Administrative
Agent's receipt of such funds and upon
fulfillment of the applicable conditions
set forth in Article III, the
Administrative Agent will (i) in the case
of the initial Borrowing, directly
apply the Advances for the account of the
Borrower to the repayment of the
aggregate principal amount outstanding
under the Existing Credit Agreement and
(ii) in the case of the second Borrowing,
make such funds available to the
Borrower by crediting the Borrower's
Account. Anything in subsection (a) above
to the contrary notwithstanding, the
Borrower may not select Eurodollar Rate
Advances with respect to any Borrowing if
the obligation of the Lenders to make
Eurodollar Rate Advances shall then be
suspended pursuant to Section 2.03, 2.10
or 2.11.
(c) The failure of any Lender to make the Advance to be made
by it as part of either Borrowing shall not
relieve any other Lender of its
obligation, if any, hereunder to make its
Advance on the date of such
Borrowing, but no Lender shall be
responsible for the failure of any other
Lender to make the Advance required of such
other Lender on the date of such
Borrowing.
(d) Each Notice of Borrowing shall be irrevocable and binding
on the Borrower. If the Notice of Borrowing
for any Borrowing specifies the
Advances thereunder are to be comprised of
Eurodollar Rate Advances, the
Borrower shall indemnify each Lender
against any loss, cost or expense incurred
by such Lender as a result of any failure
to fulfill on or before the date
specified in such Notice of Borrowing the
conditions set forth in Article III,
including any loss (including loss of
anticipated profits), cost or expense
incurred by reason of the liquidation or
redeployment of deposits or other
funds acquired by such Lender to fund the
Advance to be made by such Lender as
part of such Borrowing when such Advance,
as a result of such failure, is not
made on such date.
(e) Subject to the Administrative Agent giving prompt notice
of the relevant Notice of Borrowing
received by the Administrative Agent to the
Lenders, unless the Administrative Agent
shall have received notice from a
Lender prior to the date of the Borrowing
requested under such Notice of
Borrowing that such Lender will not make
available to the Administrative Agent
such Lender's ratable portion of such
Borrowing, the Administrative Agent may
assume that such Lender has made such
portion available to the Administrative
Agent on the date of such Borrowing in
accordance with subsection (b) of this
Section 2.02 and the Administrative Agent
may, 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 ratable portion available
to the Administrative Agent, such Lender
and the Borrower severally agree to
repay or pay to the Administrative Agent
forthwith on demand such corresponding
amount and to pay interest thereon, for
each day from the date such amount is
made available to the Borrower until the
date such amount is repaid or paid to
the Administrative Agent, at (i) in the
case of the Borrower, the interest rate
applicable at such time under Section 2.07
to Advances comprising such
Borrowing and (ii) in the case of such
Lender, the Federal Funds Rate. If such
Lender shall pay to the Administrative
Agent such corresponding amount, such
amount so paid shall constitute such
Lender's Advance as part of such Borrowing
for all purposes.
Section 2.03 Interest Elections. (a) The Borrower may on any
Business Day occurring after the Closing
Date elect to Convert all or any
portion of the Advances from one Type into
Advances of the other Type and, in
the case of Eurodollar Rate Advances, may
elect Interest Periods therefor, all
as provided in the definition of "Interest
Period" and in this Section 2.03.
The Borrower may elect different options
with respect to different portions of
the Advances, in which case each such
portion shall be allocated ratably among
the Lenders in accordance with the Advances
owed to such Lenders. At no time
shall the total number of different
Interest Periods for all Eurodollar Rate
Advances outstanding exceed ten.
(b) To make an election pursuant to this Section 2.03, the
Borrower shall give the Administrative
Agent prior written notice (or
telephonic notice promptly confirmed in
writing) by telecopier or electronic
mail (a "Notice of
Conversion/Continuation") of the Conversion or Continuation,
as the case may be, (i) by 1:00 p.m. (New
York City time) on the requested date
of a Conversion into Base Rate Advances and
(ii) by 11:00 a.m. (New York City
time) three Business Days prior to a
Continuation of Eurodollar Rate Advances
or Conversion into Eurodollar Rate Advances
or, in the case of any Conversion
into Eurodollar Rate Advances requested to
occur within three Business Days
after the Closing Date, by such time and
with such shorter prior notice as may
be agreed by the Administrative Agent;
provided, however, that any Conversion
of Eurodollar Rate Advances into Base Rate
Advances shall be made only on the
last day of an Interest Period for such
Eurodollar Rate Advances. Each such
Notice of Conversion/Continuation shall be
irrevocable and binding on the
Borrower and shall specify (A) if different
options are being elected with
respect to different portions of the
Advances, the portions thereof that are to
be allocated to each resulting election (in
which case the information to be
specified pursuant to clauses (C) and (D)
shall be specified for each resulting
portion); (B) the effective date of the
election made pursuant to such Notice
of Conversion/Continuation, which shall be
a Business Day; (C) whether the
resulting Advances are to be Base Rate
Advances or Eurodollar Rate Advances;
and (D) if the resulting Advances are to be
Eurodollar Rate Advances, the
Interest Period applicable thereto after
giving effect to such election, which
shall be a period contemplated by the
definition of "Interest Period". If any
such Notice of Conversion/Continuation
requests that the Advances be comprised
of Eurodollar Rate Advances but does not
specify an Interest Period, the
Borrower shall be deemed to have selected
an Interest Period of one month. The
principal amount of any portion of the
Advances to which a Eurodollar Rate
election has been made shall not be less
than $5,000,000.
(c) If, on the expiration of any Interest Period in respect
of any Eurodollar Rate Advances, the
Borrower shall have failed to deliver a
Notice of Conversion/Continuation, then,
unless such Advances are repaid as
provided herein, the Borrower shall be
deemed to have elected to Convert such
Advances to Base Rate Advances. No Advances
may be Converted into, or Continued
as, Eurodollar Rate Advances if a Default
has occurred and is continuing,
unless the Administrative Agent and the
Required Lenders shall have otherwise
consented in writing.
(d) Upon receipt of any Notice of Conversion/Continuation,
the Administrative Agent shall promptly
notify each Lender of the details
thereof and of such Lender's ratable share
of each election.
(e) Upon the occurrence and during the continuance of any
Default, (i) each Eurodollar Rate Advance
will automatically, on the last day
of the then existing Interest Period
therefor, Convert into a Base Rate Advance
and (ii) the obligation of the Lenders to
make, or to Convert Advances into,
Eurodollar Rate Advances shall be
suspended.
(f) If any Advance is converted to a different Type of
Advance, the Borrower shall pay, on the
date of such conversion, the interest
accrued to such date on the principal
amount so converted.
Section 2.04 Termination or Reduction of Commitments. (a)
Mandatory. All Commitments and Incremental
Commitments shall terminate at 5:00
p.m. (New York City time) on the
Termination Date if the initial Borrowing has
not occurred by such time. All Unused
Commitments, if any, shall terminate at
5:00 p.m. (New York City time) on the date
which is 60 days after the Closing
Date if the second Borrowing has not
occurred by such time. In addition, on the
Second Draw Date, after giving effect to
the second Borrowing, all Unused
Commitments shall terminate.
(b) Optional. The Borrower may, at any time upon at least ten
Business Days' notice to the Administrative
Agent, terminate in whole or reduce
in part the Unused Commitments; provided
that each partial reduction of the
Commitments shall be in an aggregate amount
of $5,000,000 or an integral
multiple of $1,000,000 in excess thereof,
and such termination and reduction
shall ratably and permanently reduce each
Lender's Commitment.
Section 2.05 Repayment of Advances. The Borrower shall repay
to the Administrative Agent for the ratable
account of the Lenders the
aggregate outstanding principal amount of
the Advances on each of the following
dates in an amount equal to the product of
(a) the percentage set forth below
for such date and (b) the aggregate amount
of (i) all Advances as of the date
such Advances were disbursed to the
Borrower and (ii) the initial aggregate
amount of all Advances made pursuant to
Section 2.14 prior to such date:
Date
Percentage
----
----------
September 30, 2005
0.25%
December 31, 2005
0.25%
March 31, 2006
0.25%
June 30, 2006
0.25%
September 30, 2006
0.25%
December 31, 2006
0.25%
March 31, 2007
0.25%
June 30, 2007
0.25%
September 30, 2007
0.25%
December 31, 2007
0.25%
March 31, 2008
0.25%
June 30, 2008
0.25%
September 30, 2008
0.25%
December 31, 2008
0.25%
March 31, 2009
0.25%
June 30, 2009
0.25%
September 30, 2009
0.25%
December 31, 2009
0.25%
March 31, 2010
0.25%
June 30, 2010
0.25%
September 30, 2010
0.25%
December 31, 2010
0.25%
March 8, 2011
94.50%
provided that the final principal
installment shall be repaid on the Maturity
Date and in any event shall be in an amount
equal to the aggregate principal
amount of the Advances outstanding on such
date.
Section 2.06 Prepayments. (a) Optional. (i) Prior to the
amendment and restatement of the Security
Agreement on the Second Draw Date,
the Borrower may prepay the Advances in
accordance with Section 2.04(a) or
2.05(e) of the Security Agreement.
(ii) At any time following the amendment and restatement of
the Security Agreement on the Second Draw
Date, the Borrower may, upon at least
one Business Day's notice in the case of
Base Rate Advances and three Business
Days' notice in the case of Eurodollar Rate
Advances, in each case to the
Administrative Agent stating the proposed
date and aggregate principal amount
of the prepayment, and if such notice is
given, the Borrower shall, prepay the
outstanding aggregate principal amount of
the Advances in whole or ratably in
part, together with accrued interest to the
date of such prepayment on the
aggregate principal amount prepaid;
provided that (A) each partial prepayment
shall be in an aggregate principal amount
of $5,000,000 or an integral multiple
of $1,000,000 in excess thereof and (B) if
any prepayment of a Eurodollar Rate
Advance is made on a date other than the
last day of an Interest Period for
such Advance, the Borrower shall also pay
any amounts owing pursuant to Section
9.04(d).
(iii) Notwithstanding anything in this Agreement or any other
Financing Document to the contrary, the
Lenders hereby agree as between
themselves that if the Borrower makes a
prepayment of the Advances (A) prior to
the amendment and restatement of the
Security Agreement on the Second Draw Date
pursuant to Section 2.04(a) or 2.05(e) of
the Security Agreement or (B)
following the amendment and restatement of
the Security Agreement on the Second
Draw Date, pursuant to Section 2.06(a)(ii)
hereof, then promptly upon the
Administrative Agent's receipt of the
amount of any such prepayment pursuant to
Section 2.04(a) or 2.05(e) of the Security
Agreement or Section 2.06(a)(ii)
hereof, as the case may be, such prepayment
shall be applied to ratably repay
the Advances and to the remaining
amortization installments in any one of the
following manners, as directed by the
Borrower in writing to the Administrative
Agent (or, in the absence of any such
direction received by the Administrative
Agent prior to the relevant prepayment
date, in accordance with clause (1)
below): (1) in inverse order of maturity
with respect to the remaining
amortization installments (including the
final principal installment), (2) to
all remaining amortization installments
(including the final principal
installment) on a pro rata basis or (3) to
the next succeeding four
amortization installments as of the date of
such prepayment in direct order of
maturity as among such four installments
and, thereafter, to the remaining
amortization installments (including the
final principal installment) on a pro
rata basis.
(b) Mandatory. (i) Prior to the amendment and restatement of
the Security Agreement on the Second Draw
Date, the Borrower shall prepay the
Advances in accordance with Section 2.03 of
the Security Agreement. Any such
prepayment shall be effected through the
provisions set forth in this Section
2.06(b) and Section 2.06(c).
(ii) Following the amendment and restatement of the Security
Agreement on the Second Draw Date, the
Borrower shall prepay the Advances at
the following times and the following
amounts:
(A) Within 10 Business Days after receipt by the Borrower or
any of its Subsidiaries of cash proceeds in respect of any Asset
Sale,
in an aggregate principal amount equal to 50% of the Net Cash
Proceeds
received by the Borrower or any of its Subsidiaries in connection
with
such Asset Sale; provided that the foregoing shall not apply to
Asset
Sales, the proceeds (or any amount equal to anticipated proceeds)
of
which are (1) used or committed to be used by the Borrower or any
of
its Subsidiaries for the financing of fixed or capital assets to
be
used in the
business of the Borrower and its Subsidiaries prior to or
within 12 months after any such Asset Sale or (2) individually or
in
the aggregate for any Asset Sales in any fiscal year less than
$10,000,000;
(B) Within three Business Days of receipt by the Borrower or
any of its Subsidiaries of Net Cash Proceeds relating to any
Debt
Issuance, in an aggregate principal amount equal to 100% of the
Net
Cash Proceeds from such Debt Issuance;
(C) No later than 90 days after the end of each fiscal year
of the Borrower, commencing with the fiscal year ending on
December
31, 2005, in an aggregate principal amount equal to the
Required
Prepayment Percentage of Excess Cash Flow for the fiscal year
then
ended;
(D) (1) Subject to clause (2) below, upon receipt of Recovery
Event Proceeds by any Loan Party in respect of any Recovery Event
or
any series of related Recovery Events in excess of $25,000,000, in
an
aggregate principal amount equal to such Recovery Event
Proceeds;
(2) Notwithstanding the foregoing, if the Borrower reasonably
believes, based on reasonable estimates of loss, that Recovery
Event
Proceeds in respect of any Recovery Event or any series of
related
Recovery Events will be in excess of $25,000,000, the Borrower
may
elect to restore or replace the Asset (or portion thereof) affected
by
such Recovery Event if the Borrower has delivered to the
Administrative Agent, within 180 days from the occurrence of
such
Recovery Event, each of the following: (I) (aa) a detailed
breakdown
of the nature and extent of such Recovery Event and (bb) a bona
fide
assessment of the estimated cost and time needed to restore or
replace
the Asset (or relevant portion thereof) in order for such Asset
(or
relevant portion thereof) to operate at substantially the same
level
as prior to the Recovery Event; (II) satisfactory evidence that
such
Recovery Event Proceeds, together with any cash proceeds that
have
been or are expected to be paid to the Borrower or any other
Loan
Party in respect of such Recovery Event, and any other cash
expected
to be made available by or on behalf of the Borrower or any other
Loan
Party with respect to whose Asset the Recovery Event occurred, are
or
are expected to be sufficient to make the necessary restorations
or
replacements to such Asset (or relevant portion thereof); (III)
an
Officer's Certificate of the Borrower certifying that (aa) it
is
expected that all work necessary to restore or replace the Asset
(or
relevant portion thereof) affected by the relevant Recovery Event
(or
series of related Recovery Events) can be done within the time
periods, if any, required under any Material Contract relating to
such
Asset (or relevant portion thereof); (bb) the Asset (other than
any
Excluded Asset) subject to restoration/replacement will be subject
to
the Liens of the Collateral Documents (whether by amendment to
the
Collateral Documents or otherwise); (cc) all material
Governmental
Approvals necessary to perform the work necessary to restore or
replace the Asset (or relevant portion thereof) affected by the
relevant Recovery Event (or series of related Recovery Events)
have
been obtained (or are reasonably expected to be obtained without
undue
delay or as needed); and (dd) the Asset (or relevant portion
thereof)
once repaired/restored will be of similar value and general utility
as
immediately prior to the loss; provided that, if the Borrower does
not
deliver the information and Officer's Certificate set forth in
this
clause (2) within such 180-day period, the Borrower shall, as soon
as
reasonably
practicable after such 180-day period, prepay the Advances
in an aggregate principal amount equal to such Recovery Event
Proceeds
in accordance with clause (1) above; and
(E) Upon completion of the restoration and replacement in
respect of any Asset (or the relevant portion thereof) with respect
to
which the Borrower delivered the information and Officer's
Certificate
set forth in clause (D)(2) above, if the Recovery Event Proceeds
in
respect of the relevant Recovery Event (or series of related
Recovery
Events) exceed the cost of such restoration and replacement by
more
than $1,000,000, in an aggregate principal amount equal to such
amount
over $1,000,000; it being understood that the Borrower shall not
be
required to use any Recovery Event Proceeds in respect of a
Recovery
Event or series of related Recovery Events, which it believes,
based
on reasonable estimates of loss, will be $25,000,000 or less in
the
aggregate, to pay or as reimbursement for the costs of the
necessary
repairs to or replacement of Assets affected by the relevant
Recovery
Event pursuant to clause (D)(2) above and this clause (E).
(iii) Mandatory prepayments received by the Administrative
Agent pursuant to Section 2.05(a)(i),
2.05(a)(ii) or 2.05(a)(iii) of the
Security Agreement or pursuant to Section
2.06(b)(ii) shall be applied, first
to repay the Advances held by any Accepting
Lender and to all remaining
amortization installments thereof
(including the final principal installment)
in inverse order of maturity, and second,
if any such amounts remain on deposit
in the Prepayment Account after giving
effect to priority first of this clause
(iii), to the Borrower or as the Borrower
may otherwise direct.
(c) Application of Prepayment Amounts. (i) Promptly upon
receipt of any mandatory prepayment
pursuant to Section 2.05(a)(i), 2.05(a)(ii)
or 2.05(a)(iii) of the Security Agreement
or pursuant to Sections 2.06(b)(ii)
and 2.06(d) (the amount of such prepayment
being an "Advances Prepayment
Amount"), the Administrative Agent shall
deposit such Advances Prepayment
Amount into the Prepayment Account pending
application of such Advances
Prepayment Amount on the applicable
Prepayment Date as set forth below.
(ii) So long as any Advances shall remain outstanding,
promptly after such receipt (the date of
such receipt being the "Receipt
Date"), the Administrative Agent shall give
written notice (a "Prepayment
Notice") to each Lender of (A) the
aggregate amount of the Advances Prepayment
Amount, (B) the portion of the Advances
Prepayment Amount available to prepay
the Advances held by such Lender, (C) the
applicable Receipt Date for such
Advances Prepayment Amount and (D) the date
on which such Advances Prepayment
Amount shall be applied as a prepayment of
the Advances, which date shall be
(1) prior to the amendment and restatement
of the Security Agreement on the
Second Draw Date, the 15th Business Day
following the delivery of such
Prepayment Notice and (2) following the
amendment and restatement of the
Security Agreement on the Second Draw Date,
the fifth Business Day following
the delivery of such Prepayment Notice
(each such date above being the
"Prepayment Date").
(iii) On or prior to 10:00 a.m. (New York City time) of the
second Business Day occurring prior to the
applicable Prepayment Date, each
Lender shall notify the Administrative
Agent as to whether it accepts all or
any portion of the Advances Prepayment
Amount to be applied to prepay the
Advances held by such Lender as set forth
in such Prepayment Notice. If any
Lender fails to give such notice by such
time, such Lender (together with each
other Lender delivering a notice declining
any such prepayment, a "Declining
Lender") shall be deemed to decline such
prepayment, unless an Event of Default
shall have occurred and be continuing on
the date on which such notice is due
in which case, such Lender shall be deemed
to accept such prepayment. Any
Lender giving written notice of its
intention to accept any prepayment or which
is deemed to accept any prepayment offer in
accordance with the preceding
sentence is hereinafter referred to as an
"Accepting Lender".
(iv) On the relevant Prepayment Date, an amount equal to that
portion of the Advances Prepayment Amount
to be applied to prepay the Advances
of each Accepting Lender on such Advances
Prepayment Date shall be withdrawn
from the Prepayment Account and paid to
each such Accepting Lender as a
prepayment of the Advances of such
Accepting Lender and, in the case of any
prepayment occurring after the amendment
and restatement of the Security
Agreement on the Second Draw Date, any
amounts remaining on deposit in the
Prepayment Account that would otherwise
have been applied to prepay Advances
owing to Declining Lenders shall be applied
pursuant to priority second of
Section 2.06(b)(iii).
(d)
Prepayments Generally. Following the amendment and
restatement of the Security Agreement on
the Second Draw Date and concurrently
with any prepayment pursuant to this
Section 2.06, the Borrower shall pay to
the Administrative Agent all accrued
interest, fees, costs and expenses, if
any, and any other amounts due under the
Financing Documents in respect of the
principal amount of the Senior Debt
Obligations so prepaid.
Section 2.07 Interest. (a) Scheduled Interest. The Borrower
shall pay interest on the unpaid principal
amount of each Advance owing to each
Lender from the date of such Advance until
such principal amount shall be paid
in full, at the following rates per
annum:
(i) Base Rate Advances. During such periods as such Advance
is a Base Rate Advance, a rate per annum equal at all times to the
sum
of (A) the Base Rate in effect from time to time and (B) the
Applicable Margin in effect from time to time, payable in arrears
on
each Quarterly
Date during such periods and on the date such Base Rate
Advance shall be Converted or paid in full.
(ii) Eurodollar Rate Advances. During such periods as such
Advance is a Eurodollar Rate Advance, a rate per annum equal at
all
times during each Interest Period for such Advance to the sum of
(A)
the Eurodollar Rate for such Interest Period for such Advance and
(B)
the Applicable Margin in effect from time to time, payable in
arrears
on the last day of such Interest Period and, if such Interest
Period
has a duration of more than three months, on each day that
occurs
during such Interest Period every three months from the date of
such
Interest Period and on the date such Eurodollar Rate Advance shall
be
Converted or paid in full.
(b) Default Interest. Upon the occurrence and during the
continuance of an Event of Default, the
Borrower shall pay interest on (i) the
unpaid and overdue principal amount of each
Advance owing to each Lender,
payable in arrears on the dates referred to
in clause (a)(i) or (a)(ii) above
and on demand, at a rate per annum equal at
all times to 2% per annum above the
rate per annum required to be paid on such
Advance pursuant to clause (a)(i) or
(a)(ii) above and (ii) to the fullest
extent permitted by Applicable Law, the
amount of any interest, fee or other amount
payable hereunder that is not paid
when due, from the date such amount shall
be due until such amount shall be
paid in full, payable in arrears on the
date such amount shall be paid in full
and on demand, at a rate per annum equal at
all times to 2% per annum above the
rate per annum required to be paid, in the
case of interest, on the Type of
Advance on which such interest has accrued
pursuant to clause (a)(i) or (a)(ii)
above and, in all other cases, on Base Rate
Advances pursuant to clause (a)(i)
above.
(c) Notice of Interest Period and Interest Rate. Promptly
after receipt of a Notice of Borrowing
pursuant to Section 2.02 or a Notice of
Conversion/Continuation pursuant to Section
2.03(b), the Administrative Agent
shall give notice to the Borrower and each
relevant Lender of the applicable
Interest Period and the applicable interest
rate determined by the
Administrative Agent for purposes of clause
(a)(i) or (a)(ii) above.
Section 2.08 Fees. The Borrower shall pay to each Agent for
its own account such fees as may from time
to time be agreed between the
Borrower and such Agent.
Section 2.09 Payments Generally; Pro Rata Treatment. (a) The
Borrower shall make each payment hereunder,
under the Notes and under any
Financing Document to which the Borrower is
a party (unless specifically
provided otherwise in such Financing
Document) owing to any Lender, in full,
and without condition or deduction for any
counterclaim, defense, recoupment or
setoff, not later than 11:00 a.m. (New York
City time) on the day when due in
Dollars to the Administrative Agent at the
Administrative Agent's Account in
immediately available funds, with payments
being received by the Administrative
Agent after such time being deemed to have
been received on the next succeeding
Business Day. The Administrative Agent will
promptly thereafter cause like
funds to be distributed (i) if such payment
by (or for the account of) the
Borrower is in respect of principal,
interest or any other Obligation then
payable hereunder and under the Notes to
more than one Lender, to such Lenders
for the account of their respective
Applicable Lending Offices ratably in
accordance with the amounts of such
respective Obligations then payable to such
Lenders and (ii) if such payment by (or for
the account of) the Borrower is in
respect of any Obligation then payable
hereunder to one Lender, to such Lender
for the account of its Applicable Lending
Office, in each case to be applied in
accordance with the terms of this
Agreement. Upon its acceptance of an
Assignment and Acceptance and recording of
the information contained therein in
the Register pursuant to Section 9.07(d),
from and after the effective date of
such Assignment and Acceptance, the
Administrative Agent shall make all
payments hereunder and under the Notes in
respect of the interest assigned
thereby to the Lender assignee thereunder,
and the parties to such Assignment
and Acceptance shall make all appropriate
adjustments in such payments for
periods prior to such effective date
directly between themselves.
(b) All payments under this Agreement and the other Financing
Documents to any Agent (whether for its own
account or for the account of any
Lender) or the Depository Bank (as defined
in the Security Agreement) shall be
made to such Agent or the Depository Bank,
respectively.
(c) The Borrower hereby authorizes each Lender and each of
its Affiliates, if and to the extent
payment owed to such Lender is not made
when due hereunder or under the Note held
by such Lender, to charge from time
to time, to the fullest extent permitted by
law, against any or all of the
Borrower's accounts (other than any Pledged
Account or the Controlled Accounts)
with such Lender or such Affiliate any
amount so due.
(d) All computations of interest based on the Base Rate or
the Federal Funds Rate shall be made by the
Administrative Agent on the basis
of a year of 365 or 366 days, as the case
may be, and all computations of
interest based on the Eurodollar Rate and
of fees shall be made by the
Administrative Agent on the basis of a year
of 360 days, in each case for the
actual number of days (including the first
day but excluding the last day)
occurring in the period for which such
interest or fees are payable. Each
determination by the Administrative Agent
of an interest rate, fee or
commission hereunder shall be conclusive
and binding for all purposes, absent
manifest error.
(e) Whenever any payment hereunder or under any of the Notes
shall be stated to be due on a day other
than a Business Day, such payment
shall be made on the next succeeding
Business Day, and such extension of time
shall in such case be included in the
computation of payment of interest or
fees, as the case may be; provided,
however, that, if such extension would
cause payment of interest on or principal
of Eurodollar Rate Advances to be
made in the next following calendar month,
such payment shall be made on the
next preceding Business Day.
(f) Unless the Administrative Agent shall have received
notice from the Borrower prior to the date
on which any payment is due to any
Lender hereunder that the Borrower will not
make such payment in full, the
Administrative Agent may assume that the
Borrower has made such payment in full
to the Administrative Agent on such date
and the Administrative Agent may, in
reliance upon such assumption, cause to be
distributed to each such Lender on
such due date an amount equal to the amount
then due such Lender. If and to the
extent the Borrower shall not have so made
such payment in full to the
Administrative Agent, each such Lender
shall repay to the Administrative Agent
forthwith on demand such amount distributed
to such Lender together with
interest thereon, for each day from the
date such amount is distributed to such
Lender until the date such Lender repays
such amount to the Administrative
Agent, at the Federal Funds Rate.
(g) If the Administrative Agent receives funds for
application to the Obligations owing to the
Lenders under the Financing
Documents under circumstances for which the
Financing Documents do not specify
the manner in which such funds are to be
applied, the Administrative Agent
shall apply such funds to the ratable
payment of all outstanding Obligations
owing in respect of the Advances.
(h) If any Lender shall obtain any payment (whether
voluntary, involuntary, through the
exercise of any right of set-off, or
otherwise), other than pursuant to Section
2.10, 2.11 or 2.12, as a result of
an assignment pursuant to Section 9.07 or
as a result of the payment of an
Amendment Fee which has been offered to or
is available to all Lenders on the
same terms, (a) on account of Obligations
due and payable to such Lender
hereunder and under the Notes at such time
in excess of its ratable share
(according to the proportion of (i) the
amount of such Obligations due and
payable to such Lender at such time to (ii)
the aggregate amount of the
Obligations due and payable to all Lenders
hereunder and under the Notes at
such time) of payments on account of the
Obligations due and payable to all
Lenders hereunder and under the Notes at
such time obtained by all the Lenders
at such time or (b) on account of
Obligations owing (but not due and payable)
to such Lender hereunder and under the
Notes at such time in excess of its
ratable share (according to the proportion
of (i) the amount of such
Obligations owing to such Lender at such
time to (ii) the aggregate amount of
the Obligations owing (but not due and
payable) to all Lenders hereunder and
under the Notes at such time) of payments
on account of the Obligations owing
(but not due and payable) to all Lenders
hereunder and under the Notes at such
time obtained by all of the Lenders at such
time, such Lender shall forthwith
purchase from the other Lenders such
interests or participating interests in
the Obligations due and payable or owing to
them, as the case may be, as shall
be necessary to cause such purchasing
Lender to share the excess payment
ratably with each of them; provided that if
all or any portion of such excess
payment is thereafter recovered from such
purchasing Lender, such purchase from
each other Lender shall be rescinded and
such other Lender shall repay to the
purchasing Lender the purchase price to the
extent of such Lender's ratable
share (according to the proportion of (i)
the purchase price paid to such
Lender to (ii) the aggregate purchase price
paid to all Lenders) of such
recovery together with an amount equal to
such Lender's ratable share
(according to the proportion of (i) the
amount of such other Lender's required
repayment to (ii) the total amount so
recovered from the purchasing Lender) of
any interest or other amount paid or
payable by the purchasing Lender in
respect of the total amount so recovered.
The Borrower agrees that any Lender
so purchasing an interest or participating
interest from another Lender
pursuant to this Section 2.09 may, to the
fullest extent permitted by
Applicable Law, exercise all its rights of
payment (including the right of
set-off) with respect to such interest or
participating interest, as the case
may be, as fully as if such Lender were the
direct creditor of the Borrower in
the amount of such interest or
participating interest, as the case may be.
Section 2.10 Illegality. Notwithstanding any other provision
of this Agreement, if the introduction of
or any change in or in the
interpretation of any law or regulation
shall make it unlawful, or any central
bank or other Governmental Authority shall
assert that it is unlawful, for any
Lender or its Eurodollar Lending Office to
perform its obligations hereunder to
make Eurodollar Rate Advances or to
continue to fund or maintain Eurodollar
Rate Advances hereunder, then, on notice
thereof and demand therefor by such
Lender to the Borrower through the
Administrative Agent, (i) each Eurodollar
Rate Advance will automatically, upon such
demand, Convert into a Base Rate
Advance and (ii) the obligation of the
Lenders to make, or to Convert Advances
into, Eurodollar Rate Advances shall be
suspended until the Administrative
Agent shall notify the Borrower that such
Lender has determined that the
circumstances causing such suspension no
longer exist; provided that, before
making any such demand, such Lender agrees
to use reasonable efforts
(consistent with its internal policy and
legal and regulatory restrictions) to
designate a different Eurodollar Lending
Office if the making of such a
designation would allow such Lender or its
Eurodollar Lending Office to
continue to perform its obligations to make
Eurodollar Rate Advances or to
continue to fund or maintain Eurodollar
Rate Advances and would not, in the
judgment of such Lender, be otherwise
disadvantageous to such Lender.
Section 2.11 Increased Costs. (a) If, due to either (i) the
introduction of or any change (other than
any change by way of imposition or
increase of reserve requirements included
in the Eurodollar Rate Reserve
Percentage) in or in the interpretation of
any law or regulation or (ii) the
compliance with any guideline or request
from any central bank or other
Governmental Authority (whether or not
having the force of law), there shall be
any increase in the cost to any Lender of
agreeing to make or of making,
funding or maintaining Eurodollar Rate
Advances (excluding, for purposes of
this Section 2.11, any such increased costs
resulting from (A) Covered Taxes or
Other Taxes (as to which Section 2.12 shall
govern) and (B) changes in the
basis of taxation of overall net income or
overall gross income by the United
States or by the foreign jurisdiction or
state under the laws of which such
Lender is organized or has its Applicable
Lending Office or any political
subdivision thereof), then the Borrower
shall from time to time, upon demand by
such Lender (with a copy of such demand to
the Administrative Agent), pay to
the Administrative Agent for the account of
such Lender additional amounts
sufficient to compensate such Lender for
such increased cost; provided,
however, that a Lender claiming additional
amounts under this Section 2.11(a)
agrees to use reasonable efforts
(consistent with its internal policy and legal
and regulatory restrictions) to designate a
different Applicable Lending Office
if the making of such a designation would
avoid the need for, or reduce the
amount of, such increased cost that may
thereafter accrue and would not, in the
reasonable judgment of such Lender, be
otherwise disadvantageous to such
Lender. A certificate as to the amount of
such increased cost, submitted to the
Borrower by such Lender, shall be
conclusive and binding for all purposes,
absent manifest error.
(b) If any Lender determines that compliance with any law or
regulation or any guideline or request from
any central bank or other
Governmental Authority (whether or not
having the force of law) affects or
would affect the amount of capital required
or expected to be maintained by
such Lender or any corporation controlling
such Lender and that the amount of
such capital is increased by or based upon
the existence of such Lender's
commitment to lend and other commitments of
such type, then, upon demand by
such Lender or such corporation (with a
copy of such demand to the
Administrative Agent), the Borrower shall
pay to the Administrative Agent for
the account of such Lender, from time to
time as specified by such Lender,
additional amounts sufficient to compensate
such Lender in the light of such
circumstances, to the extent that such
Lender reasonably determines such
increase in capital to be allocable to the
existence of such Lender's
commitment to lend hereunder. A certificate
as to such amounts submitted to the
Borrower by such Lender shall be conclusive
and binding for all purposes,
absent manifest error.
(c) If, with respect to any Eurodollar Rate Advances, the
Required Lenders notify the Administrative
Agent that the Eurodollar Rate for
any Interest Period for such Advances will
not adequately reflect the cost to
such Lenders of making, funding or
maintaining their Eurodollar Rate Advances
for such Interest Period, the
Administrative Agent shall forthwith so notify
the Borrower and the Lenders, whereupon (i)
each such Eurodollar Rate Advance
will
