<PAGE>
EXHIBIT 4.2
================================================================================
$200,000,000
CREDIT AGREEMENT
Dated as of March 7, 2005
----------
Among
CENTERPOINT ENERGY HOUSTON ELECTRIC, LLC,
as Borrower,
THE BANKS PARTIES HERETO,
BARCLAYS BANK PLC,
as Syndication Agent,
BANK OF AMERICA, N.A.,
CITIBANK,
N.A.
and
UBS SECURITIES LLC,
as Co-Documentation Agents
and
JPMORGAN CHASE BANK, N.A.,
as Administrative Agent
----------
BANK OF AMERICA SECURITIES LLC and
BARCLAYS CAPITAL,
as Joint Lead Arrangers and Bookrunners
================================================================================
<PAGE>
TABLE OF CONTENTS
<TABLE>
<CAPTION>
PAGE
----
<S>
<C>
ARTICLE I DEFINITIONS AND ACCOUNTING
TERMS............................... 1
SECTION 1.1. Certain Defined
Terms.................................... 1
SECTION 1.2. Other
Definitional Provisions............................ 21
ARTICLE II AMOUNTS AND TERMS OF THE LOANS
AND LETTERS OF CREDIT.......... 22
SECTION 2.1. The
Commitments.......................................... 22
SECTION 2.2. Procedure for
Revolving Loan Borrowing................... 23
SECTION 2.3. Minimum
Tranches......................................... 24
SECTION 2.4. Letters of
Credit........................................ 24
ARTICLE III PROVISIONS RELATING TO ALL
LOANS............................. 28
SECTION 3.1. Evidence of
Loans........................................ 28
SECTION 3.2.
Fees.....................................................
29
SECTION 3.3.
Interest.................................................
29
SECTION 3.4. Reserve
Requirements..................................... 30
SECTION 3.5. Interest Rate
Determination and Protection............... 31
SECTION 3.6. Voluntary
Interest Conversion or Continuation of Loans... 31
SECTION 3.7. Funding Losses
Relating to LIBOR Rate Loans.............. 32
SECTION 3.8. Change in
Legality....................................... 33
ARTICLE IV INCREASED COSTS, TAXES, PAYMENTS
AND PREPAYMENTS.............. 33
SECTION 4.1. Increased
Costs; Capital Adequacy........................ 33
SECTION 4.2. Pro Rata
Treatment and Payments and Computations......... 35
SECTION 4.3.
Taxes....................................................
35
SECTION 4.4. Sharing of
Payments, Etc................................. 37
SECTION 4.5. Optional
Termination or Reduction of the Commitments..... 38
SECTION 4.6. Voluntary
Prepayments.................................... 38
SECTION 4.7. Mitigation of
Losses and Costs........................... 39
SECTION 4.8. Determination
and Notice of Additional Costs and
Other Amounts......................................... 39
ARTICLE V CONDITIONS OF
LENDING.......................................... 40
SECTION 5.1. Conditions
Precedent to Loans and Letters of Credit...... 40
SECTION 5.2. Conditions
Precedent to Each Borrowing................... 41
ARTICLE VI REPRESENTATIONS AND
WARRANTIES................................ 42
SECTION 6.1. Representations
and Warranties of the Borrower........... 42
ARTICLE VII AFFIRMATIVE AND NEGATIVE
COVENANTS........................... 46
SECTION 7.1. Affirmative
Covenants.................................... 46
SECTION 7.2. Negative
Covenants....................................... 49
SECTION 7.3. Borrower's
Accounting Reorganization..................... 52
</TABLE>
i
<PAGE>
<TABLE>
<S>
<C>
ARTICLE VIII EVENTS OF
DEFAULT........................................... 53
SECTION 8.1. Events of
Default........................................ 53
SECTION 8.2.
Cancellation/Acceleration................................
55
ARTICLE IX THE ADMINISTRATIVE
AGENT...................................... 57
SECTION 9.1.
Appointment..............................................
57
SECTION 9.2. Delegation of
Duties..................................... 57
SECTION 9.3. Exculpatory
Provisions................................... 57
SECTION 9.4. Reliance by
Administrative Agent......................... 57
SECTION 9.5. Notice of
Default........................................ 58
SECTION 9.6. Non-Reliance on
Administrative Agent and Other Banks..... 58
SECTION 9.7.
Indemnification..........................................
59
SECTION 9.8. Agent in Its
Individual Capacity......................... 59
SECTION 9.9. Successor
Administrative Agent........................... 59
ARTICLE X
MISCELLANEOUS..................................................
60
SECTION 10.1. Amendments and
Waivers.................................. 60
SECTION 10.2.
Notices.................................................
61
SECTION 10.3. No Waiver;
Cumulative Remedies.......................... 62
SECTION 10.4. Survival of
Representations and Warranties.............. 62
SECTION 10.5. Payment of
Expenses and Taxes; Indemnity................ 62
SECTION 10.6. Effectiveness,
Successors and Assigns,
Participations; Assignments.......................... 63
SECTION 10.7.
Setoff..................................................
66
SECTION 10.8.
Counterparts............................................
66
SECTION 10.9.
Severability............................................
66
SECTION 10.10.
Integration............................................
67
SECTION 10.11. GOVERNING
LAW.......................................... 67
SECTION 10.12. Submission to
Jurisdiction; Waivers.................... 67
SECTION 10.13.
Acknowledgments........................................
68
SECTION 10.14. Limitation on
Agreements............................... 68
SECTION 10.15. Removal of
Bank........................................ 69
SECTION 10.16. Officer's
Certificates................................. 69
SECTION 10.17. USA Patriot
Act........................................ 70
</TABLE>
ii
<PAGE>
Schedules
<TABLE>
<S>
<C>
Schedule 1.1(A) - Schedule of Commitments
and Addresses
Schedule 6.1(p) - Ownership of Capital
Stock of Subsidiaries; Significant
Subsidiaries
</TABLE>
Exhibits
<TABLE>
<S>
<C>
Exhibit A - Notice of Borrowing
Exhibit B - Notice of Interest
Conversion/Continuation
Exhibit C - Assignment and Acceptance
Exhibit D - Note
</TABLE>
iii
<PAGE>
This Credit Agreement (this "Agreement"), dated as of March 7,
2005,
among CenterPoint Energy Houston Electric,
LLC, a Texas limited liability
company (the "Borrower"), the banks and
other financial institutions from time
to time parties hereto (individually, a
"Bank" and, collectively, the "Banks"),
Barclays Bank PLC, as syndication agent (in
such capacity, the "Syndication
Agent"), Bank of America, N.A., Citibank,
N.A. and UBS Securities LLC, as
co-documentation agents (in such
capacities, the "Documentation Agents") and
JPMorgan Chase Bank, N.A., as
administrative agent (in such capacity, together
with any successors thereto in such
capacity, the "Administrative Agent").
The parties hereto hereby agree as follows:
ARTICLE I
DEFINITIONS AND ACCOUNTING TERMS
SECTION 1.1.
Certain Defined Terms. As used in this Agreement, the
following terms shall have the following
meanings:
"ABR" means for any day, a rate per annum (rounded upwards, if
necessary, to
the next 1/64 of 1%) equal to the greater of (a) the Prime
Rate in effect
on such day and (b) the Federal Funds Effective Rate in
effect on such
day plus 1/2 of 1%. For purposes hereof, "Prime Rate" means
the rate of per
annum publicly announced from time to time by JPMorgan
Chase Bank, N.A.
as its prime rate in effect at its principal office in New
York City (the
Prime Rate not being intended to be the lowest rate of
interest charged
by JPMorgan Chase Bank, N.A. in connection with extensions
of credit to
debtors). Any change in the ABR due to a change in the Prime
Rate or the
Federal Funds Effective Rate shall be effective as of the
opening of
business on the effective day of such change in the Prime Rate
or the Federal
Funds Effective Rate, respectively.
"ABR Loan" means a Loan that bears interest at the ABR as provided
in
Section
3.3(a).
"Adjusted Interest Expense" means, for any period, (a) total
interest
expense
(including that attributable to Capital Lease obligations and
capitalized
interest) determined in accordance with GAAP of the Borrower
and its
Consolidated Subsidiaries for such period with respect to all
outstanding
Indebtedness of the Borrower and its Consolidated Subsidiaries
(including all
commissions, discounts and other fees and charges owed with
respect to
letters of credit and bankers' acceptance financings and net
costs under Swap
Agreements in respect of interest rates to the extent such
net costs are
allocable to such period in accordance with GAAP) less (b)
the sum of the
following for such period (i) total interest income
determined in
accordance with GAAP and (ii) but only to the extent included
in the amount
calculated pursuant to clause (a) above, (x) interest expense
on Hybrid
Preferred Securities, (y) interest expense in respect of the
securitization
programs of the Borrower and its Consolidated Subsidiaries
and in respect
of any other Securitization Securities and (z) amortization
of settlement
payments previously made on forward-starting Swap Agreements
and of any
upfront fees and other costs associated with financings for the
Borrower and its
Consolidated Subsidiaries.
<PAGE>
"Administrative Agent" has the meaning specified in the
introduction
to this
Agreement.
"Affiliate" means any Person that, directly or indirectly, Controls
or
is Controlled by
or is under common Control with another Person.
"Agents" means the collective reference to the Syndication Agent,
the
Documentation
Agents and the Administrative Agent.
"Agreement" has the meaning specified in the introduction to
this
Agreement.
"Applicable Margin" means the rate per annum set forth below
opposite
the Designated
Rating from time to time in effect during the period for
which payment is
due:
<TABLE>
<CAPTION>
DESIGNATED RATING LIBOR RATE
MARGIN ABR
MARGIN
-----------------
----------------- ----------
<S>
<C>
<C>
BBB+ or Baa1 or higher
0.625%
0.000%
BBB or
Baa2
0.750%
0.000%
BBB- or Baa3
0.875%
0.000%
BB+ or Ba1
1.000%
0.000%
BB or Ba2 or lower
1.250%
0.250%
</TABLE>
In each row in the table set forth above,
the first indicated rating corresponds
to that assigned by S&P and the second
indicated rating corresponds to that
assigned by Moody's; the determination of
which row of such table is applicable
at any time is set forth in the definition
of "Designated Rating".
"Application" means an application, in such form as an Issuing
Bank
may specify from
time to time, requesting such Issuing Bank to issue a
Letter of
Credit.
"Assignment and Acceptance" has the meaning specified in
Section
10.6(c).
"Available Commitment" means, as to any Bank at any time, an
amount
equal to the
excess, if any, of (a) such Bank's Commitment then in effect
over (b) such
Bank's Outstanding Extensions of Credit then outstanding.
"Bank" and "Banks" have the meanings specified in the introduction
to
this
Agreement.
"Bank Affiliate" means, (a) with respect to any Bank, (i) an
Affiliate
of such Bank
that is a bank or (ii) any entity (whether a corporation,
partnership,
trust or otherwise) that is engaged in making, purchasing,
holding or
otherwise investing in bank loans and similar extensions of
credit in the
ordinary course of its business and is administered or
managed by a
Bank or an Affiliate of such Bank and (b) with respect to any
Bank that is a
fund which invests in bank loans and similar extensions of
credit, any
2
<PAGE>
other fund that
invests in bank loans and similar extensions of credit and
is managed by
such Bank, an Affiliate of such Bank or the same investment
advisor as such
Bank or by an Affiliate of such investment advisor.
"Board" means the Board of Governors of the Federal Reserve System
of
the United
States (or any successor thereto).
"Borrowed Money" of any Person means any Indebtedness of such
Person
for or in
respect of money borrowed or raised by whatever means
(including
acceptances,
deposits, lease obligations under Capital Leases, Mandatory
Payment
Preferred Stock and synthetic leases); provided, however, that
Borrowed Money
shall not include (a) any guarantees that may be incurred by
endorsement of
negotiable instruments for deposit or collection in the
ordinary course
of business or similar transactions, (b) any obligations or
guarantees of
performance of obligations under a franchise, performance
bonds, franchise
bonds, obligations to reimburse drawings under letters of
credit issued in
accordance with the terms of any safe harbor lease or
franchise or in
lieu of performance or franchise bonds or other obligations
incurred in the
ordinary course of business that do not represent money
borrowed or
raised, in each case to the extent that such reimbursement
obligations are
payable in full within ten (10) Business Days after the
date upon which
such obligation arises, (c) trade payables, (d) any
obligations of
such Person under Swap Agreements, (e) customer advance
payments and
deposits arising in the ordinary course of business or (f)
operating
leases.
"Borrower" has the meaning specified in the introduction to
this
Agreement.
"Borrowing" means a borrowing consisting of Loans under Section 2.1
of
the same Type,
and having, in the case of LIBOR Rate Loans, the same
Interest Period,
made on the same day by the Banks.
"Borrowing Date" means any Business Day specified by the Borrower
as a
date on which
the Borrower requests the Banks to make Loans hereunder.
"Business Day" means a day other than a Saturday, Sunday or other
day
on which
commercial banks in New York City are authorized or required by
law to close;
provided that when used in connection with a LIBOR Rate Loan,
the term
"Business Day" shall also exclude any day on which commercial
banks are not
open for dealings in Dollar deposits in the London interbank
market.
"Capital
Lease" means a lease that, in accordance with GAAP, would be
recorded as a
capital lease on the balance sheet of the lessee.
"Capital Stock" means any and all shares, interests, participations
or
other
equivalents (however designated) of capital stock of a
corporation,
and any and all
equivalent ownership interests in a Person (other than a
corporation),
including without limitation, partnership interests in
partnerships and
member interests in limited liability companies, and any
and all warrants
or options to purchase any of the foregoing or securities
convertible into
any of the foregoing.
3
<PAGE>
"Cash Equivalents" means (a) marketable direct obligations issued
by,
or
unconditionally guaranteed by, the United States government or
issued by
any agency
thereof and backed by the full faith and credit of the United
States, in each
case maturing within one year from the date of acquisition;
(b) certificates
of deposit, time deposits, eurodollar time deposits or
overnight bank
deposits having maturities of 270 days or less from the date
of acquisition
issued by any Bank or by any commercial bank organized under
the laws of the
United States or any state thereof having combined capital
and surplus of
not less than $500,000,000; (c) commercial paper of an
issuer rated at
least A-1 by S&P or P-1 by Moody's, or carrying an
equivalent
rating by a nationally recognized rating agency, if both of the
two named rating
agencies cease publishing ratings of commercial paper
issuers
generally, and maturing within 270 days from the date of
acquisition; (d)
repurchase obligations of any Bank or of any commercial
bank satisfying
the requirements of clause (b) of this definition, having a
term of not more
than 30 days, with respect to securities issued or fully
guaranteed or
insured by the United States government; (e) securities with
maturities of
one year or less from the date of acquisition issued or fully
guaranteed by
any state, commonwealth or territory of the United States, by
any political
subdivision or taxing authority of any such state,
commonwealth or
territory or by any foreign government, the securities of
which state,
commonwealth, territory, political subdivision, taxing
authority or
foreign government (as the case may be) are rated at least A
by S&P or A
by Moody's; (f) securities with maturities of 270 days or less
from the date of
acquisition backed by standby letters of credit issued by
any Bank or any
commercial bank satisfying the requirements of clause (b)
of this
definition; (g) money market mutual or similar funds that
invest
exclusively in
assets satisfying the requirements of clauses (a) through
(f) of this
definition; or (h) money market funds that (i) comply with the
criteria set
forth in SEC Rule 2a-7 under the Investment Company Act of
1940, as
amended, (ii) are rated AAA by S&P and Aaa by Moody's and
(iii)
have portfolio
assets of at least $5,000,000,000.
"CEHE Backstop Agreement" means the $1,310,000,000 Credit
Agreement,
dated as of the
date hereof, among the Borrower, Citibank, N.A., as
administrative
agent, and the other financial institutions parties thereto,
as amended,
modified or supplemented from time to time.
"CEHE Facility" means the credit facilities provided under the
Existing CEHE
Credit Agreement and under the CEHE Backstop Agreement.
"CenterPoint" means CenterPoint Energy, Inc., a Texas corporation
and
utility holding
company, and the indirect parent of the Borrower.
"Change in Control" means (i) with respect to CenterPoint, the
acquisition by
any Person or "group" (within the meaning of Rule 13d-5 of
the Exchange
Act) of beneficial ownership (determined in accordance with
Rule 13d-3 of
the Exchange Act) of Capital Stock of CenterPoint, the result
of which is that
such Person or group beneficially owns 50% or more of the
aggregate voting
power of all then issued and outstanding Capital Stock of
CenterPoint or
(ii) CenterPoint shall cease to own and control
beneficially,
directly or indirectly, 100% of the outstanding common
Capital Stock of
the Borrower free and clear of all Liens. For purposes of
the foregoing,
the phrase "voting power"
4
<PAGE>
means, with
respect to an issuer, the power under ordinary circumstances to
vote for the
election of members of the board of directors or other
governing body
of such issuer.
"Closing Date" means the date, on or before March 31, 2005, all
the
conditions set
forth in Section 6.1 are satisfied (or waived) in accordance
with the terms
hereof.
"Code" means the Internal Revenue Code of 1986, as amended from
time
to time, and any
successor statute.
"Commitment" means, as to any Bank, the obligation of such Bank,
if
any, to make
Loans and participate in L/C Obligations in an aggregate
principal and/or
face amount not to exceed the amount set forth under the
heading
"Commitment" opposite such Bank's name on Schedule 1.1(A) and/or
in
the Assignment
and Acceptance pursuant to which such Bank became a party
hereto, as the
same may be changed from time to time pursuant to the terms
hereof; and
"Commitments" shall be the collective reference to the
Commitments of
all of the Banks. The original amount of the Total
Commitments is
$200,000,000.
"Commitment Fee" means, as to any Bank, the fee equal to the rate
per
annum set forth
below opposite the Designated Rating from time to time in
effect during the period for which
payment is due on the Available
Commitment of
such Bank:
<TABLE>
<CAPTION>
DESIGNATED RATING COMMITMENT
FEE
-----------------
--------------
<S>
<C>
BBB+ or Baa1 or higher
0.125%
BBB or
Baa2
0.150%
BBB- or Baa3
0.175%
BB+ or Ba1
0.200%
BB or Ba2 or lower
0.250%
</TABLE>
In each row in
the table set forth above, the first indicated rating
corresponds to
that assigned by S&P and the second indicated rating
corresponds to
that assigned by Moody's; the determination of which row of
such table is
applicable at any time is set forth in the definition of
"Designated
Rating".
"Commonly Controlled Entity" means an entity, whether or not
incorporated,
that is under common control with the Borrower within the
meaning of
Section 4001 of ERISA or is part of a group that includes the
Borrower and
that is treated as a single employer under Section 414 of the
Code.
"Confidential Information Memorandum" means the Confidential
Information
Memorandum, dated January, 2005.
"Consolidated Capitalization" means, as of any date of
determination,
the sum of (a)
Consolidated Shareholders' Equity, (b) Consolidated
Indebtedness for
Borrowed
5
<PAGE>
Money and,
without duplication, (c) Mandatory Payment Preferred Stock;
provided that
for the purpose of calculating compliance with Section
7.2(a),
Consolidated Capitalization shall be determined excluding any
adjustment,
non-cash charge to net income or other non-cash charges or
writeoffs
resulting thereto from application of SFAS No. 142.
"Consolidated EBITDA" means, for any twelve-month period ending on
the
date of
determination, Consolidated Net Income for such period plus,
without
duplication and to the extent reflected as a charge in the
statement of
such Consolidated Net Income for such period, the sum of (a)
income tax
expense, (b) interest expense, distributions on Hybrid
Preferred
Securities (to
the extent not included in interest expense and to the
extent deducted
to arrive at Consolidated Net Income), amortization or
writeoff of debt
discount and debt issuance costs and commissions,
discounts and
other fees and charges associated with Indebtedness
(including the
Loans) of the Borrower and its Consolidated Subsidiaries and
amortization of
settlement payments previously made on forward-starting
Swap Agreements,
(c) depreciation and amortization expense, (d)
amortization of
intangibles (including, but not limited to, goodwill) and
organization
costs, (e) any extraordinary, unusual or non-recurring
expenses or
losses (including, whether or not otherwise includable as a
separate item in
the statement of such Consolidated Net Income for such
period, losses
on sales of assets outside of the ordinary course of
business) and
(f) any other non-cash charges, and minus, to the extent
included as
income in the statement of such Consolidated Net Income for
such period, the
sum of (a) interest income, (b) any extraordinary, unusual
or non-recurring
income or gains (including, whether or not otherwise
includable as a
separate item in the statement of such Consolidated Net
Income for such
period, gains on the sales of assets outside of the
ordinary course
of business), (c) any other non-cash income, (d) Transition
Charges
Principal and Interest, (e) Pre-Tax Excess Mitigation Credit
and
(f) the
aggregate pre-tax principal amount of CTC Recoveries, all as
determined on a
consolidated basis. For purposes of this definition, any
results of
operations classified as "discontinued operations" in
accordance
with GAAP will
be included in the manner set forth above.
"Consolidated Indebtedness" means, as of any date of
determination,
the sum of
(i) the
total Indebtedness for Borrowed Money of the Borrower and
its Consolidated Subsidiaries as shown on the consolidated
balance
sheet of the Borrower and its Consolidated Subsidiaries,
determined
without duplication of any Guarantee of Indebtedness of the
Borrower
by any of its Consolidated Subsidiaries or of any Guarantee of
Indebtedness of any such Consolidated Subsidiary by the Borrower
or
any other Consolidated Subsidiary of the Borrower, plus
(ii) any Mandatory Payment Preferred Stock, less
(iii) the amount of Indebtedness described in clause (i)
attributable to amounts then outstanding under receivables
facilities
or arrangements to the extent that such amounts would not have
been
shown as Indebtedness on a balance sheet prepared in accordance
with
GAAP prior to January 1, 1997, less
6
<PAGE>
(iv) the greater of (x) until the date that is six months after
the receipt thereof, cash and Cash Equivalents of the Borrower and
its
Consolidated Subsidiaries on such date of determination
constituting
Net Cash Proceeds of the True-Up Securitization and (y) until the
date
of the final scheduled maturity of the CEHE Facility, the lesser
of
(A) the aggregate amount of cash and Cash Equivalents of the
Borrower
and its Consolidated Subsidiaries on such date of determination
constituting Net Cash Proceeds of the True-Up Securitization and
(B)
the aggregate principal amount outstanding on such date under the
CEHE
Facility.
"Consolidated Net Income" means, for any period, the consolidated
net
income (or loss)
of the Borrower and its Consolidated Subsidiaries,
determined on a
consolidated basis in accordance with GAAP; provided that
there shall be
excluded (a) the income (or deficit) of any Person accrued
prior to the
date it becomes a Consolidated Subsidiary of the Borrower or
is merged into
or consolidated with the Borrower or any of its Consolidated
Subsidiaries and
(b) the income (or deficit) of any Person (other than a
Consolidated
Subsidiary of the Borrower) in which the Borrower or any of
its Consolidated
Subsidiaries has an ownership interest, except to the
extent that any
such income is actually received by the Borrower or such
Consolidated
Subsidiary in the form of dividends or similar distributions.
"Consolidated Shareholders' Equity" means, as of any date of
determination,
the total assets of the Borrower and its Significant
Subsidiaries,
less all liabilities of the Borrower and its Significant
Subsidiaries. As
used in this definition, "liabilities" means all
obligations
that, in accordance with GAAP consistently applied, would be
classified on a
balance sheet as liabilities (including without limitation
(to the extent
so classified), (a) Indebtedness; (b) deferred liabilities;
and (c)
Indebtedness of the Borrower or any of its Significant
Subsidiaries
that is
expressly subordinated in right and priority of payment to
other
liabilities of
the Borrower or such Significant Subsidiary, but in any case
excluding as at
such date of determination any Junior Subordinated Debt
owned by any
Hybrid Preferred Securities Subsidiary).
"Consolidated Subsidiary" means, with respect to a specified Person
at
any date, any
Subsidiary or any other Person (other than with respect to
the Borrower,
any Securitization Subsidiary or any Unrestricted
Subsidiary), the
accounts of which under GAAP would be consolidated with
those of such
specified Person in its consolidated financial statements as
of such
date.
"Contractual Obligation" means, as to any Person, any provision of
any
security issued
by such Person or of any written agreement, instrument or
other written
undertaking to which such Person is a party or by which it or
any of its
property is bound.
"Controlled" means, with respect to any Person, the ability of
another
Person (whether
directly or indirectly and whether by the ownership of
voting
securities, contract or otherwise) to appoint and/or remove the
majority of the
members of the board of directors or other governing body
of that Person
(and "Control" shall be similarly construed).
7
<PAGE>
"CTC Recoveries" means the competition transition charges to be
paid
to the Borrower
by retail electric providers in respect of stranded costs
and certain
power market price and fuel cost recovery true-ups.
"Default" means any event that, with the lapse of time or giving
of
notice, or both,
or any other condition, would constitute an Event of
Default.
"Default Rate" means with respect to any overdue amount owed
hereunder, a
rate per annum equal to (a) in the case of overdue principal
with respect to
any Loan, the sum of the interest rate in effect at such
time with
respect to such Loan under Section 3.3, plus 2%; provided that
in
the case of
overdue principal with respect to any LIBOR Rate Loan, after
the end of the
Interest Period with respect to such Loan, the Default Rate
shall equal the
rate set forth in clause (c) below, (b) in the case of
overdue
principal with respect to any Reimbursement Obligations, the sum
of
the interest
rate per annum in effect at such time with respect to ABR
Loans under
Section 3.3, plus 2%, and (c) in the case of overdue interest
with respect to
any Loan, Commitment Fees, Utilization Fees or other
amounts payable
hereunder, the sum of the interest rate per annum in effect
at such time
with respect to ABR Loans, plus 2%.
"Designated Rating" means (a) the higher of the Ratings and (b) if
the
difference in
the Rating issued by S&P and Moody's is greater than one
level, the
Rating that is one level higher than the lower of such Ratings
shall apply. Any
change in the calculation of the Applicable Margin with
respect to the
Borrower that is caused by a change in the Designated Rating
will become
effective on the date of the change in the Designated Rating.
If the rating
system of any Rating Agency shall change, or if either S&P
or
Moody's shall
cease to be in the business of rating corporate debt
obligations, the
Borrower and the Administrative Agent shall negotiate in
good faith if
necessary to amend this definition and the definitions of
"Rating" and
"Rating Agencies" to reflect such changed rating system or the
unavailability
of Ratings from such Rating Agencies and, pending the
effectiveness of
any such amendment, the Designated Rating shall be
determined by
reference to the Rating most recently in effect prior to such
change or
cessation.
"Disposition" means with respect to any Property (excluding cash
and
Cash
Equivalents), any sale, lease, sale and leaseback, assignment,
conveyance,
transfer or other disposition thereof outside the ordinary
course of
business. The terms "Dispose" and "Disposed of" shall have
correlative
meanings.
"Documentation Agents" has the meaning specified in the
introduction
to this
Agreement.
"Dollars" and the symbol "$" mean the lawful currency of the
United
States.
"Early Funding ABR Loan" has the meaning specified in Section
2.2(a).
"ERISA" means the Employee Retirement Income Security Act of 1974,
as
amended from
time to time.
8
<PAGE>
"Event of Default" has the meaning specified in Section 8.1.
"Exchange Act" means the Securities Exchange Act of 1934, as
amended.
"Existing CEHE Credit Agreement" means the $1,310,000,000
Credit
Agreement, dated
as of November 12, 2002, among CenterPoint Electric, as
borrower, Credit
Suisse First Boston, as administrative agent, and the
other financial
institutions parties thereto, as amended, modified or
supplemented
from time to time.
"Existing CenterPoint Credit Agreement" means the
$2,350,000,000
Credit
Agreement, dated as of October 7, 2003, among CenterPoint, the
Administrative
Agent and other financial institutions parties thereto, as
heretofore
amended, modified or supplemented.
"Existing CenterPoint Credit Facility" means the credit
facility
provided under
the Existing CenterPoint Credit Agreement.
"Facility" means the Commitments and the extensions of credit
made
thereunder.
"Federal Funds Effective Rate" means, for any day, a fluctuating
rate
per annum equal
to the weighted average of the rates on overnight federal
funds
transactions with members of the Federal Reserve System arranged
by
federal funds
brokers, as published on the next succeeding Business Day by
the Federal
Reserve Bank of New York, or, if such rate is not so published
for any day 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 the Borrower.
"Funding Office" means the office of the Administrative Agent
specified in
Section 10.2 or such other office as may be specified from
time to time by
the Administrative Agent as its funding office by written
notice to the
Borrower and the Banks.
"GAAP" means generally accepted accounting principles in effect
from
time to time in
the United States of America.
"General Mortgage Indenture" means the General Mortgage
Indenture,
dated as of
October 10, 2002, between the Borrower and JPMorgan Chase Bank,
N.A. (as
successor to JPMorgan Chase Bank), as trustee, as amended,
modified or
supplemented from time to time.
"Global Coordinators" means J.P. Morgan Securities Inc. and
Citigroup
Global Markets
Inc., in their capacities as global coordinators.
"Governmental Authority" means any nation or government, any state
or
other political
subdivision thereof and any entity exercising executive,
legislative,
judicial, regulatory or administrative functions of or
pertaining to
government.
9
<PAGE>
"Guarantee" means, as to any Person (the "guaranteeing person"),
any
obligation of
(a) the guaranteeing Person or (b) another Person (including,
without
limitation, any bank under any letter of credit) to induce the
creation of
which the guaranteeing person has issued a reimbursement,
counterindemnity
or similar obligation, in either case guaranteeing or in
effect
guaranteeing any principal of any Indebtedness for Borrowed
Money
(the "primary
obligation") of any other third Person in any manner, whether
directly or
indirectly, including, without limitation, any obligation of
the guaranteeing
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 for the purchase or
payment of any
such primary obligation or (iii) otherwise to assure or hold
harmless the
owner of any such primary obligation against loss in respect
thereof. The
amount of any Guarantee of any guaranteeing person shall be
deemed to be the
lower of (a) an amount equal to the stated or determinable
amount of the
primary obligation in respect of which such Guarantee is made
and (b) the
maximum amount for which such guaranteeing person may be liable
pursuant to the
terms of the instrument embodying such Guarantee, unless
such primary
obligation and the maximum amount for which such guaranteeing
person may be
liable are not stated or determinable, in which case the
amount of such
Guarantee shall be such guaranteeing person's maximum
reasonably
anticipated liability in respect thereof as determined by the
Borrower in good
faith (and "guaranteed" and "guarantor" shall be construed
accordingly).
"Highest Lawful Rate" means, with respect to each Bank, the
maximum
nonusurious
interest rate, if any, that at any time or from time to time
may be
contracted for, taken, reserved, charged or received with respect
to
any Loan or on
other amounts, if any, due to such Bank pursuant to this
Agreement or any
other Loan Document under applicable law. "Applicable law"
as used in this
definition means, with respect to each Bank, that law in
effect from time
to time that permits the charging and collection by such
Bank of the
highest permissible lawful, nonusurious rate of interest on the
transactions
herein contemplated including, without limitation, the laws of
each State that
may be held to be applicable, and of the United States, if
applicable.
"Hybrid Preferred Securities" means preferred securities issued by
any
Hybrid Preferred
Securities Subsidiary.
"Hybrid Preferred Securities Subsidiary" means any Delaware
business
trust (or
similar entity) (i) all of the common equity interest of which
is
owned (either
directly or indirectly through one or more Wholly-Owned
Subsidiaries) at
all times by the Borrower, (ii) that has been formed for
the purpose of
issuing Hybrid Preferred Securities and (iii) substantially
all of the
assets of which consist at all times solely of the Junior
Subordinated
Debt and payments made from time to time on the Junior
Subordinated
Debt.
"Indebtedness" of any Person means the sum of (a) all items
(other
than Capital
Stock, capital surplus, retained earnings, other comprehensive
income, treasury
stock and any other items that would properly be included
in shareholder
equity) that, in accordance with GAAP consistently applied,
would be
included in determining total liabilities as shown on the
liability side
of a balance sheet of such Person as at the date on which
the
10
<PAGE>
Indebtedness is
to be determined, (b) all obligations of such Person,
contingent or
otherwise, as account party or applicant (or equivalent
status) in
respect of any standby letters of credit or equivalent
instruments, and
(c) without duplication, the amount of Guarantees by such
Person of items
described in clauses (a) and (b); provided, however, that
Indebtedness of
a Person shall not include (i) any Junior Subordinated Debt
owned by any
Hybrid Preferred Securities Subsidiary, (ii) any Guarantee by
the Borrower or
its Subsidiaries of payments with respect to any Hybrid
Preferred
Securities, (iii) any Securitization Securities or (iv) any
Hybrid Preferred
Securities.
"Insolvency" means, with respect to any Multiemployer Plan, the
condition that
such Plan is insolvent within the meaning of Section 4245 of
ERISA (and
"Insolvent" shall be construed accordingly for such purposes).
"Interest Period" means, for each LIBOR Rate Loan comprising part
of
the same
Borrowing, the period commencing on the date of such LIBOR Rate
Loan or the date
of the conversion of any Loan into such LIBOR Rate Loan,
as the case may
be, and ending on the last day of the period selected by
the Borrower
pursuant to Section 2.2 or 3.6, as the case may be, and,
thereafter, each
subsequent period commencing on the last day of the
immediately
preceding Interest Period and ending on the last day of the
period selected
by the Borrower pursuant to Section 3.6. The duration of
each such
Interest Period shall be one, two, three, six or, if available
to
all Banks under
the Facility, nine or twelve months or periods shorter than
one month, as
Borrower may select by notice pursuant to Section 2.2 or 3.6
hereof,
provided, however, that:
(i) any Interest Period in respect of a Loan that would
otherwise
extend beyond the Termination Date shall end on the Termination
Date;
(ii) whenever the last day of any Interest Period would
otherwise
occur on a day other than a Business Day, the last day of such
Interest Period shall be extended to occur on the next
succeeding
Business Day; provided that if such extension would cause the last
day
of such Interest Period to occur in the next following calendar
month,
the last day of such Interest Period shall occur on the next
preceding
Business Day, and
(iii) any Interest Period that begins on the last Business Day
of
a calendar month (or on a day for which there is no numerically
corresponding day in the calendar month at the end of such
Interest
Period) shall end on the last Business Day of a calendar month.
"Investment" has the meaning specified in Section 7.2(f).
"Issuing Bank" means (i) JPMorgan Chase Bank, N.A., and
Citibank,
N.A., each in
its capacity as issuer of any Letter of Credit; provided,
however, that
neither JPMorgan Chase Bank, N.A. nor Citibank, N.A. shall be
required to
issue Letters of Credit in excess of $25,000,000 at any time
outstanding for
each such Issuing Bank, and (ii) any other Bank, in such
capacity,
selected to be an Issuing Bank by the Borrower with the consent
of the
Administrative Agent, which shall not be unreasonably withheld,
and
such Bank.
11
<PAGE>
Any reference to
an Issuing Bank herein means the applicable institution
issuing the
applicable Letter of Credit.
"Junior Subordinated Debt" means subordinated debt of the Borrower
or
any Subsidiary
of the Borrower (i) that is issued at par to a Hybrid
Preferred
Securities Subsidiary in connection with the issuance of Hybrid
Preferred
Securities, (ii) the payment of the principal of which and
interest on
which is subordinated (with certain exceptions) to the prior
payment in full
in cash or its equivalent of all senior indebtedness of the
obligor
thereunder and (iii) that has an original tenor no earlier than
30
years from the
issuance thereof.
"L/C Commitment" means the amount of $50,000,000.
"L/C Fee Payment Date" means the last day of each March, June,
September and
December while the L/C Commitment remains in effect and the
Termination
Date.
"L/C Obligations" means, at any time, an amount equal to the sum
of
(a) the
aggregate then undrawn and unexpired face amount of the then
outstanding
Letters of Credit and (b) the aggregate amount of drawings
under Letters of
Credit that have not then been reimbursed pursuant to
Section 2.4.
"L/C Participants" means the collective reference to all the
Banks
other than the
Issuing Bank in their respective capacities as participants
in L/C
Obligations.
"Lead Arrangers" means Barclays Capital and Bank of America
Securities
LLC, in their
capacities as joint lead arrangers and bookrunners.
"Letters of Credit" has the meaning assigned to such term in
Section
2.4(a)(ii).
"LIBOR Rate" means, with respect to each day during each
Interest
Period
pertaining to a LIBOR Rate Loan, the rate per annum determined
on
the basis of the
rate for deposits in Dollars for a period equal to such
Interest Period
commencing on the first days of such Interest Period
appearing on
Page 3750 of the Telerate screen as of 11:00 A.M., London
time, two
Business Days prior to the beginning of such Interest Period.
In
the event that
such rate does not appear on Page 3750 of the Telerate
screen (or
otherwise on such screen), the "LIBOR Rate" shall be determined
by reference to
such other comparable publicly available service for
displaying
eurodollar rates as may be selected by the Administrative Agent
or, in the
absence of such availability, by reference to the rate at which
the
Administrative Agent is offered Dollar deposits at or about 11:00
A.M.,
New York City
time, two Business Days prior to the beginning of such
Interest Period
in the interbank eurodollar market where its eurodollar and
foreign currency
and exchange operations are then being conducted for
delivery on the
first day of such Interest Period for the number of days
comprised
therein.
"LIBOR Rate Loan" means a Loan that bears interest at the LIBOR
Rate
as provided in
Section 3.3(b).
12
<PAGE>
"Lien" means any mortgage, deed of trust, pledge,
hypothecation,
assignment,
deposit arrangement, charge, security interest, encumbrance or
lien of any kind
whatsoever (including any Capital Lease).
"Loans" means the loans made by the Banks to the Borrower pursuant
to
this
Agreement.
"Loan Documents" means this Agreement, any Notes and any document
or
instrument
executed in connection with the foregoing.
"Majority Banks" means, at any time, Banks having in excess of 50%
of
the Total
Commitments then in effect or, if the Commitments shall have
terminated, the
Total Outstanding Extensions of Credit then outstanding.
"Mandatory Payment Preferred Stock" means any preference or
preferred
stock of the
Borrower or of any Consolidated Subsidiary (other than (x) any
preference or
preferred stock issued to the Borrower or its Subsidiaries,
(y) Hybrid
Preferred Securities and (z) Junior Subordinated Debt) that is
subject to
mandatory redemption, sinking fund or retirement provisions
(regardless of
whether any portion thereof is due and payable within one
year).
"Margin Stock" has the meaning assigned to such term in Regulation
U.
"Material Adverse Effect" means any material adverse effect on
the
ability of the Borrower to perform
its obligations under the Loan Documents
on a timely
basis (it being understood that Material Adverse Effect shall
not include the
effect of any True-Up Litigation).
"Maturity Date" means March 7, 2010.
"Moody's" means Moody's Investors Service, Inc. and any
successor
rating
agency.
"Multiemployer Plan" means a Plan that is a multiemployer plan
as
defined in
Section 4001(a)(3) of ERISA.
"Net Cash Proceeds" means, in connection with any True-Up
Securitization
or any incurrence of Indebtedness for Borrowed Money, the
cash proceeds
received from such securitization or incurrence,
respectively,
net of attorneys' fees, investment banking fees, accountants'
fees,
underwriting discounts, escrow fees, reserves, related swap costs
and
commissions and
other customary fees and expenses actually incurred in
connection
therewith and other similar payment obligations resulting
therefrom that
are required to be paid concurrently or otherwise as a
result of such
securitization or incurrence.
"Net Tangible Assets" means the total assets of the Borrower,
its
Consolidated
Subsidiaries and the Unrestricted Subsidiaries, minus goodwill
and other
intangible assets as shown on the balance sheet of the
Borrower,
its Consolidated
Subsidiaries and the
13
<PAGE>
Unrestricted
Subsidiaries delivered pursuant to Section 7.1(a) in respect
of the most
recently ended fiscal quarter of the Borrower.
"Notes" means the collective reference to any promissory note
evidencing
Loans.
"Notice of Borrowing" has the meaning specified in Section 2.2.
"Notice of Interest Conversion/Continuation" has the meaning
specified
in Section
3.6(a).
"Original Mortgage" means the Mortgage and Deed of Trust, dated as
of
November 1,
1944, by the Borrower to South Texas Commercial National Bank
of Houston, as
Trustee (JPMorgan Chase Bank, N.A., as successor Trustee),
as amended,
modified or supplemented from time to time.
"Other Taxes" has the meaning specified in Section 4.3(b).
"Outstanding Extensions of Credit" means, as to any Bank at any
time,
an amount equal
to the sum of (a) the aggregate principal amount of all
Loans made by
such Bank then outstanding and (b) such Bank's Revolving
Percentage of
the L/C Obligations then outstanding.
"Participant" has the meaning specified in Section 10.6(b).
"PBGC" means the Pension Benefit Guaranty Corporation
established
pursuant to
Subtitle A of Title IV of ERISA or any successor.
"Permitted Liens" means with respect to any Person:
(a) Liens for current taxes, assessments or other governmental
charges that are not delinquent or remain payable without any
penalty,
or the validity or amount of which is contested in good faith
by
appropriate proceedings, provided, however, that adequate
reserves
with respect thereto are maintained on the books of such Person
in
accordance with GAAP, and provided, further, that any right to
seizure, levy, attachment, sequestration, foreclosure or
garnishment
with respect to Property of such Person or any Subsidiary of
such
Person by reason of such Lien has not matured, or has been, and
continues to be, effectively enjoined or stayed;
(b)
landlord Liens for rent not yet due and payable and Liens for
materialmen, mechanics, warehousemen, carriers, employees,
workmen,
repairmen and other similar nonconsensual Liens imposed by
operation
of law, for current wages or accounts payable or other sums not
yet
delinquent, in each case arising in the ordinary course of business
or
if overdue, that are being contested in good faith by
appropriate
proceedings, provided, however, that any right to seizure,
levy,
attachment, sequestration, foreclosure or garnishment with respect
to
Property of such Person or any Subsidiary of such Person by reason
of
14
<PAGE>
such Lien has not matured, or has been, and continues to be,
effectively enjoined or stayed;
(c) Liens (other than any Lien imposed pursuant to Section
401(a)(29) or 412(n) of the Code, ERISA or any environmental
law,
order, rule or regulation) incurred or deposits made, in each case,
in
the ordinary course of business, (i) in connection with
workers'
compensation, unemployment insurance and other types of social
security or (ii) to secure (or to obtain letters of credit that
secure) the performance of tenders, statutory obligations, surety
and
appeal bonds, bids, leases, performance or payment bonds,
purchase,
construction, sales contracts and other similar obligations, in
each
case not incurred or made in connection with the borrowing of
money,
the obtaining of advances or the payment of the deferred
purchase
price of property;
(d) Liens arising out of or in connection with any litigation
or
other legal proceeding that is being contested in good faith by
appropriate proceedings; provided, however, that adequate
reserves
with respect thereto are maintained on the books of such Person
in
accordance with GAAP; and provided, further, that, subject to
Section
8.1(i) (so long as such Lien is discharged or released within 60
days
of attachment thereof), any right to seizure, levy, attachment,
sequestration, foreclosure or garnishment with respect to Property
of
such Person or any Subsidiary of such Person by reason of such
Lien
has not matured, or has been, and continues to be, effectively
enjoined or stayed;
(e) precautionary filings under the applicable Uniform
Commercial
Code made by a lessor with respect to personal property leased to
such
Person or any Subsidiary of such Person;
(f) other non-material Liens or encumbrances none of which
secures Indebtedness for Borrowed Money of the Borrower or any of
its
Subsidiaries or interferes materially with the use of the
Property
affected in the ordinary conduct of Borrower's or its
Subsidiaries'
business and
which individually or in the aggregate do not have a
Material Adverse Effect;
(g) easements, rights-of-way, restrictions and other similar
encumbrances and exceptions to title existing or incurred in
the
ordinary course of business that, in the aggregate, do not in any
case
materially detract from the value of the property subject thereto
or
materially interfere with the ordinary conduct of the business of
the
Borrower and its Subsidiaries, taken as a whole;
(h) (i) Liens created by Capital Leases, provided that the
Liens
created by any such Capital Lease attach only to the Property
leased
to the Borrower or one of its Subsidiaries pursuant thereto,
(ii)
purchase money Liens securing Indebtedness of the Borrower or any
of
its Subsidiaries (including such Liens securing such
Indebtedness
incurred within twelve months of the date on which such Property
was
acquired), provided that all such Liens attach only to the
Property
purchased with the proceeds of the Indebtedness secured thereby
and
15
<PAGE>
only secure the Indebtedness incurred to finance such purchase,
(iii)
Liens on receivables, customer charges, notes, ownership
interests,
contracts or contract rights created in connection with a sale,
securitization or monetization of such receivables, customer
charges,
notes, ownership interests, contracts or contract rights, and Liens
on
rights of the Borrower or any Subsidiary related to such
receivables,
customer charges, notes, ownership interests, contracts or
contract
rights which are transferred to the purchaser of such
receivables,
customer charges, notes, ownership interests, contracts or
contract
rights in connection with such sale, securitization or
monetization,
provided that such Liens secure only the obligations of the
Borrower
or any of its Subsidiaries in connection with such sale,
securitization or monetization and (iv) Liens created by leases
that
do not constitute Capital Leases at the time such leases are
entered
into, provided that the Liens created thereby attach only to
the
Property leased to the Borrower or one of its Subsidiaries
pursuant
thereto;
(i) Liens on cash and short-term investments (i) deposited by
the
Borrower or any of its Subsidiaries in accounts with or on behalf
of
futures contract brokers or other counterparties or (ii) pledged
by
the Borrower or any of its Subsidiaries, in the case of clause (i)
or
(ii) to
secure its obligations with respect to contracts (including
without limitation, physical delivery, option (whether cash or
financial), exchange, swap and futures contracts) for the purchase
or
sale of any energy-related commodity or interest rate or currency
rate
management contracts;
(j) Liens on (i) Property owned by a Project Financing
Subsidiary
or (ii) equity interests in a Project Financing Subsidiary
(including
in each case a pledge of a partnership interest, common stock or
a
membership interest in a limited liability company) securing
Indebtedness of the Borrower or any of its Subsidiaries incurred
in
connection with a Project Financing; and
(k) Liens on equity interests in an Unrestricted Subsidiary
(including in each case a pledge of a partnership interest,
common
stock or a membership interest in a limited liability company)
securing, subject to Section 7.2(f), Indebtedness of such
Unrestricted
Subsidiary.
"Person" means an individual, partnership, corporation (including
a
business trust),
joint stock company, trust, unincorporated association,
joint venture,
government (or any political subdivision or agency thereof)
or any other
entity of whatever nature.
"Plan" means, at a particular time with respect to the Borrower,
any
employee benefit
plan that is covered by ERISA and in respect of which
Borrower or a
Commonly Controlled Entity is (or, if such plan were
terminated at
such time, would under Section 4069 of ERISA be deemed to be)
an "employer" as
defined in Section 3(5) of ERISA.
"Pre-Tax Excess Mitigation Credit" means the amount of the credit,
if
any, (including
the interest component) provided to retail electric
customers under
order of the PUC to reflect the refund of an amount equal
to estimated
cumulative excess earnings
16
<PAGE>
applicable to
the years 1998 through 2001 which were used to accelerate
depreciation on
electric generation assets in order to reduce or mitigate
exposure to
stranded costs associated with electric generation assets or
any other credit
provided to customers that will be recovered through
securitization
or CTC Recoveries.
"Project Financing" means any Indebtedness or lease obligations
that
do not
constitute Capital Leases at the time such leases are entered
into,
in each case
that are incurred to finance a project or group of projects
(including any
construction financing) to the extent that such Indebtedness
(or other
obligations) expressly are not recourse to the Borrower or any
of
its Restricted
Subsidiaries (other than a Project Financing Subsidiary) or
any of their
respective Property other than the Property of a Project
Financing
Subsidiary and equity interests in a Project Financing
Subsidiary
(including in
each case a pledge of a partnership interest, common stock or
a membership
interest in a limited liability company).
"Project Financing Subsidiary" means any Restricted Subsidiary of
the
Borrower (or any
other Person in which Borrower directly or indirectly owns
a 50% or less
interest) whose principal purpose is to incur Project
Financing or to
become an owner of interests in a Person so created to
conduct the
business activities for which such Project Financing was
incurred, and
substantially all the fixed assets of which Subsidiary or
Person are those
fixed assets being financed (or to be financed) in whole
or in part by
one or more Project Financings.
"Property" means any interest or right in any kind of property
or
asset, whether
real, personal or mixed, owned or leased, tangible or
intangible and
whether now held or hereafter acquired.
"Purchasing Banks" has the meaning specified in Section
10.6(c).
"PUC" means the
Public Utility Commission of Texas.
"Rating" means the Borrower's corporate credit rating issued by
S&P
and the
Borrower's issuer rating issued by Moody's (it being understood
that a change in
outlook status (e.g., watch status, negative outlook
status) is not a
change in Rating as contemplated hereby).
"Rating Agencies" means (a) S&P and (b) Moody's.
"Register" has the meaning specified in Section 10.6(d) hereof.
"Regulation U" means Regulation U of the Board or any other
regulation
hereafter
promulgated by the Board to replace the prior Regulation U and
having
substantially the same function.
"Reimbursement Obligation" means the obligation of the Borrower
to
reimburse the Issuing
Bank pursuant to Section 2.4(e) for amounts drawn
under Letters of
Credit.
17
<PAGE>
"Reorganization" means, with respect to any Multiemployer Plan,
the
condition that
such Plan is in reorganization within the meaning of Section
4241 of
ERISA.
"Reportable Event" means any of the events set forth in Section
4043(c) of ERISA
and PBGC Reg. Section 4043, other than those events as to
which the
thirty-day notice period is waived under PBGC Reg. Section 4043
or other
regulations, notices or rulings issued by the PBGC.
"Requirement of Law" means, as to any Person, any law, statute,
ordinance,
decree, requirement, order, judgment, rule or regulation of any
Governmental
Authority.
"Responsible Officer" means, with respect to any Person, its
chief
financial
officer, chief accounting officer, assistant treasurer,
treasurer
or controller of
such Person or any other officer of such Person whose
primary duties
are similar to the duties of any of the previously listed
officers of such
Person.
"Restricted Subsidiaries" means all Subsidiaries of the Borrower
other
than
Securitization Subsidiaries and Unrestricted Subsidiaries.
"Revolving Percentage" means, as to any Bank at any time, a
fraction
(expressed as a
percentage) the numerator of which is the amount of such
Bank's
Commitment or, if the Commitments shall have terminated, the
Outstanding
Extensions of Credit of such Bank then outstanding, and the
denominator of
which is the Total Commitments then in effect or, if the
Commitments
shall have terminated, the Total Outstanding Extensions of
Credit then
outstanding.
"S&P" means Standard & Poor's Ratings Group and any
successor rating
agency.
"SEC" means the Securities and Exchange Commission and any
successor
thereto.
"Secured Indebtedness" means, with respect to any Person, all
Indebtedness
secured (or for which the holder of such Indebtedness has an
existing right,
contingent or otherwise, to be secured) by any Lien on any
Property
(including, without limitation, accounts and contract rights)
owned by such Person or any of its
Subsidiaries, even though such Person
has not assumed
or become liable for the payment of such Indebtedness.
"Securitization Securities" means transition bonds issued pursuant
to
the Texas
Electric Choice Plan if (and only if) no recourse may be had to
the Borrower or
any of its Subsidiaries (or to their respective assets) for
the payment of
such obligations, other than the issuer of the bonds and its
assets, provided
that payment of transition charges by any retail electric
provider ("REP")
in accordance with such legislation, whether or not such
REP has
collected such charges from the retail electric customers,
shall
not be deemed
"recourse" hereunder, including any REP that is a Subsidiary
of the Borrower
or a division of an Affiliate of the Borrower or any
Affiliate of the
Borrower.
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"Securitization Subsidiary" means a special purpose subsidiary
created
to issue
Securitization Securities.
"Significant Subsidiary" means (i) for the purposes of
determining
what constitutes
an "Event of Default" under Sections 8.1(f), (g), (h), (i)
and (j), a
Subsidiary of the Borrower (other than a Project Financing
Subsidiary)
whose total assets, as determined in accordance with GAAP,
represent at
least 10% of the total assets of the Borrower, on a
consolidated
basis, as determined in accordance with GAAP and (ii) for all
other purposes
the "Significant Subsidiaries" shall be those Subsidiaries
of the Borrower
whose total assets, as determined in accordance with GAAP,
represent at
least 10% of the total assets of the Borrower on a
consolidated
basis, as determined in accordance with GAAP for the
Borrower's most
recently completed fiscal year and identified in the
certificate most
recently delivered pursuant to Section 7.1(a)(iv)(C);
provided that no
Securitization Subsidiary or Unrestricted Subsidiary shall
be deemed to be
a Significant Subsidiary or subject to the restrictions,
covenants or
Events of Default under this Agreement.
"Single Employer Plan" means any Plan that is covered by Title IV
of
ERISA, but that
is not a Multiemployer Plan.
"Subsidiary" means, as to any Person, a corporation,
partnership,
limited
liability company or other entity of which more than 50% of the
outstanding
shares of Capital Stock or other ownership interests having
ordinary voting
power (other than Capital Stock or such other ownership
interests having
such power only by reason of the happening of a
contingency) to
elect directors or other managers of such corporation,
partnership or
other entity are at the time owned, directly or indirectly,
through one or
more Subsidiaries of such Person, by such Person; provided,
however, that no
Securitization Subsidiary shall be deemed to be a
Subsidiary for
purposes of this Agreement.
"Swap Agreement" means any agreement with respect to any swap,
forward, future
or derivative transaction or option or similar agreement
involving, or
settled by reference to, one or more rates, currencies,
commodities,
equity or debt instruments or securities, or economic,
financial or
pricing indices or measures of economic, financial or pricing
risk or value or
any similar transaction or any combination of these
transactions;
provided that no phantom stock or similar plan providing for
payments only on
account of services provided by current or former
directors,
officers, employees or consultants of the Borrower or any of
its
Subsidiaries
shall be a "Swap Agreement".
"Syndication Agent" has the meaning specified in the introduction
to
this
Agreement.
"Taxes" has the meaning specified in Section 4.3(a).
"Termination Date" means the Maturity Date or any earlier date
on
which (a) the
Commitments have been terminated in accordance with this
Agreement or (b)
all unpaid
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principal
amounts of the Loans hereunder have been declared due and
payable
in accordance
with this Agreement.
"Texas Genco" means Texas Genco Holdings, Inc.
"Texas Genco Stock" means the Capital Stock of Texas Genco now
owned
or hereafter
acquired by Utility Holding, LLC, which, as of the date
hereof,
constitutes 100% of the issued and outstanding Capital Stock of
Texas Genco.
"Total Commitments" means, at any time, the aggregate amount of
the
Commitments of
all Banks then in effect.
"Total Outstanding Extensions of Credit" means, at any time,
the
aggregate amount
of the Outstanding Extensions of Credit of all Banks
outstanding at
such time.
"Tranche" means the collective reference to LIBOR Rate Loans,
the
Interest Periods
with respect to all of which begin on the same date and
end on the same
later date (whether or not such Loans shall originally have
been made on the
same day).
"Transferee" has the meaning specified in Section 10.6(f).
"Transfer Effective Date" has the meaning specified in Section
10.6(c).
"Transition Charges Principal and Interest" means the
non-bypassable
transition
charges billed to customers for payment of debt service on
Securitization
Securities.
"Triggering Event" has the meaning specified in Section 4.8(b).
"True-Up Litigation" means any litigation or other proceeding
in
connection with
the determination by the PUC of the recovery by CenterPoint
and its
Subsidiaries of stranded costs and other amounts to be recovered
in
the true-up
process.
"True-Up
Securitization" means a sale or contribution of assets to a
Securitization
Subsidiary or series of such transactions, together with the
issuance of
Securitization Securities.
"Type" refers to the determination of whether a Loan is an ABR Loan
or
a LIBOR Rate
Loan (or a Borrowing comprised of such Loans).
"Uniform Customs" means the Uniform Customs and Practice for
Documentary
Credits (1993 Revision), International Chamber of Commerce
Publication No.
500, as the same may be amended from time to time.
"United States" means the United States of America.
"Unrestricted Subsidiary" means any Subsidiary of the Borrower and
its
direct or
indirect Subsidiaries that is designated by a Responsible
Officer
of the Borrower
as an Unrestricted Subsidiary, but only if (x) the
aggregate amount
of net tangible assets of all
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<PAGE>
Unrestricted
Subsidiaries at the time of designation does not exceed, or
would not exceed
as a result of such designation, 10% of the Net Tangible
Assets, (y) such
designation and the Investment of the Borrower in such
Subsidiary
complies with the limitations in Section 7.2(f) and (z) such
Subsidiary: (i) has no
Indebtedness with recourse to the Borrower and the
Restricted
Subsidiaries except that permitted under Section 7.2(f); (ii)
is
not party to any
agreement, contract, arrangement or understanding with the
Borrower or any
Significant Subsidiary of the Borrower unless the terms of
any such
agreement, contract, arrangement or understanding and related
transactions are
substantially no less favorable to the Borrower or such
Significant
Subsidiary than those that might be obtained at the time from
Persons who are
not Affiliates of the Borrower; (iii) is a Person with
respect to which
neither the Borrower nor any of its Significant
Subsidiaries has
any direct or indirect obligation that violates Section
7.2(f) (a) to
subscribe for additional Capital Stock of such Person or (b)
to maintain or
preserve such Person's financial condition or to cause such
Person to
achieve any specified levels of operating results; and (iv)
does
not, either
alone or in the aggregate, operate, directly or indirectly, all
or substantially
all of the business of the Borrower and its Subsidiaries.
Any designation of a Subsidiary of the Borrower as an
Unrestricted
Subsidiary shall
be evidenced by a certificate of a Responsible Officer of
the Borrower
giving effect to such designation and a certificate executed
by a Responsible
Officer certifying that such designation complied with the
preceding
conditions and was permitted by Section 7.2(f) delivered to the
Administrative
Agent. If, at any time, any Unrestricted Subsidiary would
fail to meet the
preceding requirements as an Unrestricted Subsidiary, it
shall thereafter
cease to be an Unrestricted Subsidiary for purposes of
this Agreement
and any Indebtedness of such Subsidiary shall be deemed to
be incurred by a
Significant Subsidiary of the Borrower as of such date
and, if such
Indebtedness is not permitted to be incurred as of such date
under Section
7.2(f), the Borrower shall be in default of such covenant. A
Responsible
Officer of the Borrower may at any time designate any
Unrestricted
Subsidiary to be a Subsidiary of the Borrower that is not an
Unrestricted
Subsidiary; provided that such designation shall be deemed to
be an incurrence
of Indebtedness by such Subsidiary of any outstanding
Indebtedness of
such Unrestricted Subsidiary and such designation shall
only be
permitted if (1) such Indebtedness is permitted under this
Agreement
calculated on a pro forma basis as if such designation had
occurred at the
beginning of the four-quarter reference period; and (2) no
Default or Event
of Default would be in existence following such
designation.
"Utilization Fee" has the meaning specified in Section 3.2(b).
"Wholly-Owned" means, with respect to any Subsidiary of any
Person,
all the
outstanding Capital Stock (other than directors' qualifying
shares
required by law)
or other ownership interest of such Subsidiary which are
at the time
owned by such Person or by one or more Wholly-Owned
Subsidiaries of
such Person, or both.
SECTION 1.2.
Other Definitional Provisions. (a) Unless otherwise specified
therein, all terms defined in this
Agreement shall have such defined meanings
when used in the other Loan Documents or
any certificate or other document made
or delivered pursuant hereto or
thereto.
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<PAGE>
(b) As used
herein and in the other Loan Documents, and any certificate or
other document made or delivered pursuant
hereto or thereto, (i) accounting
terms relating to the Borrower or any of
its Subsidiaries not defined in Section
1.1 and accounting terms partly defined in
Section 1.1, to the extent not
defined, shall have the respective meanings
given to them under GAAP, (ii) the
words "include", "includes" and "including"
shall be deemed to be followed by
the phrase "without limitation", (iii) the
word "incur" shall be construed to
mean incur, create, issue, assume, become
liable in respect of or suffer to
exist (and the words "incurred" and
"incurrence" shall have correlative
meanings), (iv) the words "asset" and
"property" shall be construed to have the
same meaning and effect and to refer to any
and all tangible and intangible
assets and properties, including cash,
Capital Stock, securities, revenues,
accounts, leasehold interests and contract
rights, and (v) references to
agreements or other Contractual Obligations
shall, unless otherwise specified,
be deemed to refer to such agreements or
Contractual Obligations as amended,
supplemented, restated or otherwise
modified from time to time.
(c) The words
"hereof", "herein" and "hereunder" and words of similar
import, when used in this Agreement, shall
refer to this Agreement as a whole
and not to any particular provision of this
Agreement, and Section, Schedule and
Exhibit references are to this Agreement
unless otherwise specified.
(d) The meanings
given to terms defined herein shall be equally applicable
to both the singular and plural forms of
such terms.
ARTICLE II
AMOUNTS AND TERMS OF THE LOANS AND LETTERS OF CREDIT
SECTION 2.1. The
Commitments. (a) Each Bank severally agrees, on the terms
and subject to the conditions hereinafter
set forth, to make revolving credit
Loans to the Borrower from time to time on
any Business Day during the period
from the Closing Date until the Termination
Date in an aggregate principal
amount outstanding, which, when added to
such Bank's Revolving Percentage of the
then outstanding L/C Obligations, does not
exceed at any time such Bank's
Commitment; provided that no Loan shall be
made as a LIBOR Rate Loan with an
Interest Period ending after the
Termination Date; and provided, further, that
in no event shall the Total Outstanding
Extensions of Credit at any time exceed
the Total Commitments at such time.
(b) Each
Borrowing by the Borrower shall be in an aggregate principal
amount not less than $10,000,000 (in the
case of LIBOR Rate Loans) or $5,000,000
(in the case of ABR Loans), or an integral
multiple of $1,000,000 in excess
thereof and shall consist of Loans of the
same Type made on the same day by the
Banks ratably according to their respective
Revolving Percentages. Within the
limits of the applicable Commitments, the
Borrower may borrow, prepay pursuant
to Section 4.6 and reborrow under this
Section 2.1. The principal amount
outstanding on the Loans shall be due and
payable on the Termination Date,
together with accrued and unpaid interest
thereon.
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<PAGE>
SECTION 2.2.
Procedure for Revolving Loan Borrowing. (a) The Borrower may
borrow under the Commitments on any
Business Day during the period from and
including the Closing Date to and excluding
the Termination Date, provided that
the Borrower shall give the Administrative
Agent irrevocable oral notice or
written notice pursuant to a notice of
borrowing, in substantially the form of
Exhibit A hereto ("Notice of Borrowing")
which shall be signed by the Borrower
and shall specify therein the requested (i)
date of such Borrowing, (ii) Type of
Loans comprising such Borrowing, (iii)
aggregate amount of such Borrowing and
(iv) the Interest Period for each such Loan
in the case of any LIBOR Rate Loan:
(i) not later than 11:00 A.M. (New York City time) on the third
Business Day
prior to the date of the proposed Borrowing in the case of a
LIBOR Rate
Loan;
(ii) not later than 11:00 A.M. (New York City time) on the
Business
Day immediately
preceding the date of the proposed Borrowing in the case of
an Early Funding
ABR Loan; and
(iii) not later than 11:00 A.M. (New York City time) on the
same
Business Day of
the proposed Borrowing in the case of any other ABR Loan.
With respect to any oral notice of
borrowing given by the Borrower, the Borrower
shall promptly thereafter confirm such
notice in writing pursuant to a Notice of
Borrowing. Upon receipt of any such notice,
the Administrative Agent shall
promptly notify each Bank thereof. Each
Bank shall, before 1:00 P.M. (New York
City time) on the date of such Borrowing,
make available to the Administrative
Agent at the Funding Office, in immediately
available funds, such Bank's
applicable Revolving Percentage of such
Borrowing; provided, however, that, in
the event of a requested ABR Loan with
respect to which the Borrower has
delivered its Notice of Borrowing on the
Business Day immediately preceding the
requested Borrowing Date (an "Early Funding
ABR Loan"), each Bank shall make its
applicable Revolving Percentage of such
Borrowing available before 10:00 A.M.
(New York City time) on the requested
Borrowing Date. The Administrative Agent
shall, no later than 2:00 P.M. (New York
City time) on such date (or no later
than 11:00 A.M. (New York City time), in
the case of an Early Funding ABR Loan),
make available to the Borrower the proceeds
of the Loans received by the
Administrative Agent hereunder by crediting
such account of the Borrower which
the Administrative Agent and the Borrower
shall from time to time designate.
Each Notice of Borrowing shall be
irrevocable and binding on the Borrower.
(b) Unless the
Administrative Agent shall have received notice from a Bank
at least two hours prior to the applicable
time described in clause (a) above by
which such Bank is required to deliver its
funds to the Administrative Agent
with respect to any Borrowing that such
Bank will not make available to the
Administrative Agent such Bank's applicable
Revolving Percentage of such
Borrowing, the Administrative Agent may
assume that such Bank has made such
portion available to the Administrative
Agent on the date of such Borrowing in
accordance with Section 2.2(a) and the
Administrative Agent may, in reliance
upon such assumption, make available to the
Borrower on such date a
corresponding amount. If such amount is
made available to the Administrative
Agent on a date after such date of
Borrowing, such Bank shall pay to the
Administrative Agent on demand an amount
equal to the product of (i) the daily
average Federal Funds Effective Rate during
such period, times (ii) the amount
of such Bank's
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<PAGE>
applicable Revolving Percentage of such
Borrowing, times (iii) a fraction, the
numerator of which is the number of days
that elapse from and including such
date of Borrowing to the date on which such
Bank's applicable Revolving
Percentage of such Borrowing shall have
become immediately available to the
Administrative Agent and the denominator of
which is 360. A certificate of the
Administrative Agent submitted to any Bank
with respect to any amounts owing
under this Section 2.2(b) shall be
conclusive in the absence of manifest error.
If such Bank shall repay to the
Administrative Agent such corresponding amount,
such amount so repaid shall constitute such
Bank's Loan as part of such
Borrowing for purposes of this Agreement.
If such Bank's applicable Revolving
Percentage of such Borrowing is not in fact
made available to the Administrative
Agent by such Bank within one (1) Business
Day of such date of Borrowing, the
Administrative Agent shall be entitled to
recover such amount with interest
thereon at the rate per annum, equal to (i)
the ABR (in the case of ABR Loans)
or (ii) the Federal Funds Effective Rate
(in the case of LIBOR Rate Loans), on
demand, from the Borrower.
(c) The failure
of any Bank to make the Loan to be made by it as part of
any Borrowing shall not relieve any other
Bank of its obligation, if any,
hereunder to make its Loan on the date of
such Borrowing, but no Bank shall be
responsible for the failure of any other
Bank to make the Loan to be made by
such other Bank on the date of any
Borrowing.
SECTION 2.3.
Minimum Tranches. All Borrowings, prepayments, conversions and
continuations of Loans hereunder and all
selections of Interest Periods
hereunder shall be in such amounts and be
made pursuant to such elections so
that, after giving effect thereto, the
aggregate principal amount of the Loans
comprising each Tranche of LIBOR Rate Loans
shall be equal to $10,000,000 or an
integral multiple of $1,000,000 in excess
thereof.
SECTION 2.4.
Letters of Credit. (a) L/C Commitment.
(i) Subject to the terms and conditions hereof, each Issuing Bank,
in
reliance on the
agreements of the other Banks set forth in Section 2.4(d),
agrees to issue
standby letters of credit (the "Letters of Credit") for the
account of the
Borrower in support of obligations (including, without
limitation,
performance, bid and similar bonding obligations and credit
enhancement) of
the Borrower and its Affiliates on any Business Day on or
after the
Closing Date and prior to the Termination Date in such form as
may be approved
from time to time by such Issuing Bank; provided that no
Issuing Bank
shall have any obligation to issue any Letter of Credit if,
after giving
effect to such issuance, (A) the L/C Obligations would exceed
the L/C
Commitment or (B) the Total Outstanding Extensions of Credit
then
outstanding
would exceed the Total Commitments then in effect and provided,
further, that
neither JPMorgan Chase Bank, N.A. nor Citibank, N.A. shall be
required to
issue Letters of Credit in excess of $25,000,000 at any time
outstanding for
each such Issuing Bank.
(ii) Each Letter of Credit shall be denominated in Dollars and
shall
be a standby
letter of credit issued to support obligations of the Borrower
or any of its
Affiliates, contingent or otherwise, and expire no later than
the Maturity
Date.
(iii) Each Letter of Credit shall be subject to the Uniform
Customs
and, to the
extent not inconsistent therewith, the laws of the State of New
York.
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<PAGE>
(iv) No Issuing Bank shall at any time be obligated to issue
any
Letter of Credit
hereunder if such issuance would conflict with, or cause
such Issuing
Bank or any L/C Participant to exceed any limits imposed on
such Issuing
Bank by, any applicable Requirement of Law.
(b) Procedure
for Issuance of Letters of Credit. The Borrower may from time
to time request that an Issuing Bank issue
a Letter of Credit by delivering to
such Issuing Bank at its address for
notices specified herein an Application
therefor, completed to the satisfaction of
such Issuing Bank, and such other
certificates, documents and other papers
and information as such Issuing Bank
may reasonably request. Upon receipt of any
Application, the Issuing Bank will
process such Application and the
certificates, documents and other papers and
information delivered to it in connection
therewith in accordance with its
customary procedures and shall promptly
issue the Letter of Credit requested
thereby (but in no event shall any Issuing
Bank be required to issue any Letter
of Credit earlier than two Business Days
after its receipt of the Application
therefor and all such other certificates,
documents and other papers and
information relating thereto) by issuing
the original of such Letter of Credit
in a form satisfactory to the Borrower to
the beneficiary thereof or as
otherwise may be agreed by such Issuing
Bank and Borrower. The relevant Issuing
Bank shall furnish a copy of such Letter of
Credit to the Borrower promptly
following the issuance thereof and notify
the Banks of the amount thereof.
(c) Fees,
Commissions and Other Charges.
(i) The Borrower shall pay to the Administrative Agent, for the
account of the
relevant Issuing Bank and the L/C Participants, a letter of
credit
commission fee with respect to each Letter of Credit, computed
for
the period from
the last L/C Fee Payment Date (or, if later, the date of
issuance
thereof) to the date upon which such payment is due hereunder
at
the rate per
annum equal to the Applicable Margin for LIBOR Rate Loans then
in effect,
calculated on the basis of a 365- (or 366-, as the case may be)
day year, of the
aggregate amount available to be drawn under such Letter
of Credit on the
date on which such fee is calculated. The Borrower shall
pay to the
Administrative Agent, for the account of the relevant Issuing
Bank, a fronting
fee with respect to each Letter of Credit, computed for
the period from
the last L/C Fee Payment Date to the date upon which such
payment is due
hereunder at the rate per annum equal to 0.125%, calculated
on the basis of
a 365- (or 366-, as the case may be) day year, of the
aggregate amount
available to be drawn under such Letter of Credit on the
date on which
such fee is calculated. Such commissions and fronting fees
shall be payable
in arrears on each L/C Fee Payment Date and shall be
nonrefundable.
(ii) In addition to the foregoing fees and commissions, the
Borrower
shall pay or
reimburse each Issuing Bank for such normal and customary
costs and
reasonable expenses as are incurred or charged by such Issuing
Bank in issuing,
effecting payment under, amending or otherwise
administering
any Letter of Credit.
(iii) The Administrative Agent shall, promptly following its
receipt
thereof,
distribute to the relevant Issuing Bank and the L/C
Participants
all fees and
commissions received by the Administrative Agent for their
respective
accounts pursuant to this Section 2.4(c).
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<PAGE>
(d) L/C
Participations.
(i) Each
Issuing Bank irrevocably agrees to grant and hereby grants to
each L/C
Participant, and, to induce each Issuing Bank to issue Letters
of
Credit
hereunder, each L/C Participant irrevocably agrees to accept
and
purchase and
hereby accepts and purchases from such Issuing Bank, on the
terms and
conditions hereinafter stated, for such L/C Participant's own
account and risk
an undivided interest equal to such L/C Participant's
Revolving
Percentage in each Issuing Bank's obligations and rights under
each Letter of
Credit issued hereunder and the aggregate amount of drawings
under Letters of
Credit that have not then been reimbursed pursuant to
Section 2.4(e).
Each L/C Participant unconditionally and irrevocably agrees
with each
Issuing Bank that, if a draft is paid under any Letter of
Credit
for which such
Issuing Bank is not reimbursed in full by the Borrower in
accordance with
the terms of this Agreement, such L/C Participant shall pay
to such Issuing
Bank upon demand at such Issuing Bank's address for notices
specified herein
an amount equal to such L/C Participant's Revolving
Percentage of
the amount of such draft, or any part thereof, which is not
so reimbursed.
Each Bank acknowledges and agrees that its obligation to
acquire
participations pursuant to this Section 2.4(d)(i) in respect of
Letters of
Credit is absolute and unconditional and shall not be affected
by any
circumstance whatsoever, including any amendment, renewal or
extension of any
Letter of Credit or the occurrence and continuance of a
Default or
reduction or termination of the Commitments, and that each such
payment shall be
made without any offset, abatement, withholding or
reduction
whatsoever.
(ii) If any amount required to be paid by any L/C Participant to
an
Issuing Bank
pursuant to Section 2.4(d)(i) in respect of any unreimbursed
portion of any
payment made by such Issuing Bank under any Letter of Credit
is not paid to
such Issuing Bank within one Business Day after the date
such payment is
due, such L/C Participant shall pay to such Issuing Bank on
demand an amount
equal to the product of (A) such amount, times (B) the
daily average
Federal Funds Effective Rate as quoted by the relevant
Issuing Bank,
during the period from and including the date such payment is
required to the
date on which such payment is immediately available to such
Issuing Bank,
times (C) a fraction the numerator of which is the number of
days that elapse
during such period and the denominator of which is 360. If
any such amount
required to be paid by any L/C Participant pursuant to
Section
2.4(d)(i) is not in fact made available to the relevant Issuing
Bank by such L/C
Participant within three (3) Business Days after the date
such payment is
due, such Issuing Bank shall be entitled to recover from
such L/C
Participant, on demand, such amount with interest thereon
calculated from such
due date at the ABR. A certificate of the relevant
Issuing Bank
submitted to any L/C Participant with respect to any amounts
owing under this
subsection shall be conclusive in the absence of manifest
error.
(iii) Whenever,
at any time after any Issuing Bank has made payment
under any Letter
of Credit and has received from any L/C Participant its
pro rata share
of such payment in accordance with Section 2.4(d)(i), such
Issuing Bank
receives any payment related to such Letter of Credit (whether
directly from
the Borrower or otherwise, including proceeds of collateral
applied thereto
by the Issuing Bank), or any payment of interest on account
thereof, such
Issuing Bank will distribute to such L/C Participant its
26
<PAGE>
pro rata share
thereof; provided, however, that in the event that any such
payment received
by such Issuing Bank shall be required to be returned by
such Issuing
Bank, such L/C Participant shall return to such Issuing Bank
the portion
thereof previously distributed by such Issuing Bank to it.
(e)
Reimbursement Obligation of the Borrower. (i) The Borrower
shall
reimburse each Issuing Bank for any payment
that such Issuing Bank makes under a
Letter of Credit on or before the date of
such payment if the Borrower receives
notice of such payment on or before 10:00
a.m. (New York City time) on the date
such payment is made by such Issuing Bank;
provided, however, that, if the
Borrower does not receive timely notice or
reimburse such Issuing Bank under
this Section 2.4(e)(i), then Section
2.4(e)(ii) shall apply. Each such payment
shall be made to the relevant Issuing Bank
at its address for notices specified
herein in Dollars and in immediately
available funds.
(ii) Notwithstanding Section 5.2, each drawing under any Letter
of
Credit shall be
deemed to constitute a Borrowing of ABR Loans in the amount
of such drawing
unless the Borrower has reimbursed the relevant Issuing
Bank under
Section 2.4(e)(i). The Borrowing Date with respect to each such
borrowing shall
be deemed to be the date of such drawing.
(f) Obligations
Absolute.
(i) The Borrower's payment obligations under Section 2.4(e) shall
be
absolute and
unconditional under any and all circumstances and irrespective
of any set-off,
counterclaim or defense to payment that the Borrower may
have or have had
against the relevant Issuing Bank or any beneficiary of a
Letter of Credit
other than a defense based upon the gross negligence or
willful
misconduct of such Issuing Bank or violation of the standards
of
care specified
in the Uniform Commercial Code of the State of New York.
(ii)
The Borrower also agrees with each Issuing Bank that no Issuing
Bank shall be
responsible for, and the Borrower's Reimbursement Obligations
under Section
2.4(e) shall not be affected by, among other things, (i) the
validity or
genuineness of documents or of any endorsements thereon, even
though such
documents shall in fact prove to be invalid, fraudulent or
forged, (ii) any
dispute between or among the Borrower and any beneficiary
of any Letter of
Credit or any other party to which such Letter of Credit
may be
transferred or (iii) any claims whatsoever of the Borrower
against
any beneficiary
of such Letter of Credit or any such transferee.
(iii) No Issuing Bank shall be liable for any error, omission,
interruption or
delay in transmission, dispatch or delivery of any message
or advice,
however transmitted, in connection with any Letter of Credit,
except for
errors or omissions caused by such Issuing Bank's gross
negligence or
willful misconduct or in violation of the standards of care
specified in the
Uniform Commercial Code of the State of New York.
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(iv) The Borrower agrees that any action taken or omitted by
any
Issuing Bank under or
in connection with any Letter of Credit or the
related drafts
or documents, if done in the absence of gross negligence or
willful
misconduct and in accordance with the standards of care
specified
in the Uniform
Commercial Code of the State of New York, shall be binding
on the Borrower
and shall not result in any liability of such Issuing Bank
to the
Borrower.
(g) Letter of
Credit Payments. If any draft shall be presented for payment
under any Letter of Credit, the relevant
Issuing Bank shall promptly notify the
Borrower by telephone (confirmed in
writing) of the date and amount thereof and
whether such Issuing Bank has made or will
make a payment thereunder. The
responsibility of such Issuing Bank to the
Borrower in connection with any draft
presented for payment under any Letter of
Credit shall, in addition to any
payment obligation expressly provided for
in such Letter of Credit, be limited
to determining that the documents
(including each draft) delivered under such
Letter of Credit in connection with such
presentment are in conformity with such
Letter of Credit.
(h) Application.
To the extent that any provision of any Application
related to any Letter of Credit is
inconsistent with the provisions of this
Section 2.4, the provisions of this Section
2.4 shall control.
(i) Replacement
of the Issuing Bank. Any Issuing Bank may be replaced at
any time by written agreement among the
Borrower, the Administrative Agent, the
replaced Issuing Bank and the successor
Issuing Bank. The Administrative Agent
shall notify the Banks of any such
replacement of such Issuing Bank. At the time
any such replacement shall become
effective, the Borrower shall pay all unpaid
fees accrued for the account of such
replaced Issuing Bank pursuant to Section
2.4(c). From and after the effective date
of any such replacement, (i) the
applicable successor Issuing Bank shall
have all the rights and obligations of
such Issuing Bank under this Agreement with
respect to Letters of Credit to be
issued thereafter and (ii) references
herein to the term "Issuing Bank" shall be
deemed to refer to such successor or to any
previous Issuing Bank, or to such
successor and all previous Issuing Banks,
as the context shall require. After
the replacement of an Issuing Bank
hereunder, the applicable replaced Issuing
Bank shall remain a party hereto and shall
continue to have all the rights and
obligations of an Issuing Bank under this
Agreement with respect to Letters of
Credit issued by it prior to such
replacement, but shall not be required to
issue additional Letters of Credit.
ARTICLE III
PROVISIONS RELATING TO ALL LOANS
SECTION 3.1.
Evidence of Loans. (a) Each Bank shall maintain in accordance
with its usual practice an account or
accounts evidencing indebtedness of the
Borrower to such Bank resulting from each
Loan made by such Bank from time to
time, including, without limitation, the
amounts of principal and interest
payable and paid to such Bank from time to
time under this Agreement.
(b) The
Administrative Agent shall maintain the Register pursuant to
Section 10.6(d) and a subaccount therein
for each Bank, in which shall be
recorded (i) the amount of each Loan
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made by each Bank through the
Administrative Agent hereunder, the type thereof
and each Interest Period applicable
thereto, (ii) the amount of any principal or
interest due and payable or to become due
and payable from the Borrower to each
Bank hereunder and (iii) both the amount of
any sum received by the
Administrative Agent hereunder from the
Borrower and each Bank's share thereof.
(c) The entries
made in the Register and the accounts of each Bank
maintained pursuant to Section 3.1(a)
shall, to the extent permitted by
applicable law, be prima facie evidence of
the existence and amount of the
obligations of the Borrower therein
recorded; provided, however, that the
failure of any Bank or the Administrative
Agent to maintain the Register or any
such account, or any error therein, shall
not in any manner affect the
obligation of the Borrower to repay (with
applicable interest) the Loans
actually made to the Borrower by such Bank
in accordance with the terms of this
Agreement.
SECTION 3.2.
Fees. (a) The Borrower agrees to pay to the Administrative
Agent for the account of each Bank the
Commitment Fee, from the date hereof
until such date that the Loans and other
obligations under this Agreement have
been paid in full, payable quarterly in
arrears on the last day of each March,
June, September and December until such
date that the Loans and other
obligations under this Agreement have been
paid in full and on such date of
payment in full, commencing on the first
such date to occur after the date
hereof.
(b) The Borrower
agrees to pay to the Administrative Agent for the account
of each Bank a utilization fee (the
"Utilization Fee") at a rate per annum equal
to 0.125% on the Outstanding Extensions of
Credit of such Bank at any time that
the Total Outstanding Extensions of Credit
outstanding shall exceed 50% of the
Total Commitments then in effect, payable
quarterly in arrears on the last day
of each March, June, September and
December, commencing on the first such date
to occur after the date hereof.
(c) The fees
payable under Sections 3.2(a) and 3.2(b) shall be calculated
by the Administrative Agent on the basis of
a 365- or 366-day year, as the case
may be, for the actual days (including the
first day but excluding the last day)
occurring in the period for which such fee
is payable.
(d) The Borrower
shall pay to the Administrative Agent, for its own
account, the fees in the amounts and on the
dates previously agreed to in
writing by the Borrower and the
Administrative Agent.
SECTION 3.3.
Interest. The Borrower shall pay interest on the unpaid
principal amount of each Loan made by each
Bank from the date of such Loan until
such principal amount shall be paid in
full, at the times and at the rates per
annum set forth below:
(a) ABR Loans.
Each ABR Loan shall bear interest at a rate per annum equal
at all times to the lesser of (i) the ABR
plus the Applicable Margin and (ii)
the Highest Lawful Rate, payable quarterly
in arrears on the last day of each
March, June, September and December and on
the Termination Date.
(b) LIBOR Rate
Loans. Each LIBOR Rate Loan shall bear interest at a rate
per annum equal at all times to, in the
case of each LIBOR Rate Loan, the lesser
of (A) the sum of
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the LIBOR Rate for the applicable Interest
Period for such Loan plus the
Applicable Margin and (B) the Highest
Lawful Rate, payable on the last day of
such Interest Period and, with respect to
Interest Periods of six, nine or
twelve months, on the ninetieth (90th) day
after the commencement of the
Interest Period and on each succeeding
ninetieth (90th) day during such Interest
Period, and on the Termination Date.
(c)
Calculations. Interest that is determined by reference to the ABR
shall
be calculated by the Administrative Agent
on the basis of a 365- or 366-day
year, as the case may be, for the actual
days (including the first day but
excluding the last day) occurring in the
period in which such interest is
payable and otherwise shall be calculated
by the Administrative Agent on the
basis of a 360-day year for the actual days
(including the first day and
excluding the last day) occurring in the
period for which such interest is
payable.
(d) Default
Rate. Notwithstanding the foregoing, if all or a portion of (i)
the principal amount of any Loan or
Reimbursement Obligation, (ii) any interest
payable thereon, or (iii) any Commitment
Fee, Utilization Fee or other amount
payable hereunder shall not be paid when
due (whether at the stated maturity, by
acceleration or otherwise), such overdue
amount shall bear interest, payable
from time to time on demand, at a rate per
annum equal to the lesser of (A) the
Highest Lawful Rate and (B) the Default
Rate, in each case from the date of such
non-payment until such amount is paid in
full (as well after as before
judgment).
(e)
Determination Conclusive. Each determination of an interest rate by
the
Administrative Agent pursuant to any
provisions of this Agreement shall be
conclusive and binding on the Borrower and
the Banks in the absence of manifest
error. The Administrative Agent shall, at
the request of the Borrower, deliver
to the Borrower a statement showing in
reasonable detail the quotations used by
the Administrative Agent in determining the
LIBOR Rate.
SECTION 3.4.
Reserve Requirements. (a) The Borrower agrees to pay to each
Bank that requests compensation under this
Section 3.4 in accordance with the
provisions set forth in Section 4.8(b), so
long as such Bank shall be required
to maintain reserves against "Eurocurrency
liabilities" under Regulation D of
the Board (or, so long as such Bank shall
be required by the Board or by any
other Governmental Authority to maintain
reserves against any other category of
liabilities that inclu
