CREDIT
AGREEMENT (this “ Agreement
”), dated as of July 8, 2008, among Calpine Corporation,
a Delaware corporation (the “ Borrower
”), the lenders listed in Schedule 2.01 (together with
their successors and assigns, the “ Lenders
”), Goldman Sachs Credit Partners L.P. (“
GSCP
”), as payment agent for the Lenders (in such capacity,
the “ Payment
Agent ”) and GSCP, as sole lead arranger and sole
bookrunner (in such capacity, the “ Lead
Arranger ”).
WITNESSETH:
WHEREAS,
the Borrower has requested that the Lenders provide the
commodity collateral revolving credit agreement (the “
Facility
”) hereinafter described in the amounts and on the terms
and conditions set forth herein; and
WHEREAS,
the Lenders have agreed to provide such facility on the terms
and conditions set forth herein, and GSCP has agreed to act as
Payment Agent on behalf of the Lenders on such terms and
conditions set forth herein.
NOW,
THEREFORE, the parties hereto agree as follows:
ARTICLE I
DEFINITIONS; CONSTRUCTION
SECTION 1.01.
Defined Terms .
(a)
As
used in this Agreement, the following terms shall have the meanings
specified below:
“
Adjusted
Total Commitment ”
shall mean at any time the Total Commitment less the
aggregate Commitments of all Defaulting Lenders.
“
Administrative
Agent ”
shall have the meaning ascribed to such term in Article VIII
(b).
“
Advance
” shall mean each advance made pursuant to Article II
and collectively the “ Advances
”.
“
Advance
Date ” shall mean (i) the Closing Date and (ii)
each Related Advance Date.
“
Affiliate
” shall mean, when used with respect to a specified
Person, another Person that directly or indirectly controls or
is controlled by or is under common control with the Person
specified. For the purposes of the foregoing,
“control,” “controlled by” and
“under common control with” with respect to any
Person shall mean the possession, directly or indirectly, of
the power to direct or cause the direction of the management
and policies of such Person, whether through ownership of
voting securities or by contract or otherwise.
“
Agent
” shall have the meaning set forth in Section 8.01(d)
below.
“
Agent
Affiliates ” shall have the meaning ascribed to
such term in Section 9.02(b)(iii).
“
Aggregate
Outstanding Advances ” shall mean, on any date of
determination, an amount equal to the aggregate principal
amount of all then outstanding Advances made by all
Lenders.
“
Agreement
”
shall have the meaning ascribed to such term in the preamble
hereto.
“
Applicable
Reserve Requirement ” means at any time, the
maximum rate, expressed as a decimal, at which reserves
(including any basic marginal, special, supplemental,
emergency or other reserves) are required to be maintained
with respect thereto against “Eurocurrency
liabilities” (as such term is defined in Regulation D)
under regulations issued from time to time by the Board or
other applicable banking regulator. Without
limiting the effect of the foregoing, the Applicable Reserve
Requirement shall reflect any other reserves required to be
maintained by such member banks with respect to (i) any
category of liabilities which includes deposits by reference
to which the applicable LIBO Rate or any other interest rate
of an Advance is to be determined, or (ii) any category of
extensions of credit or other assets which include
Advances. An Advance shall be deemed to constitute
Eurocurrency liabilities and as such shall be deemed subject
to reserve requirements without benefits of credit for
proration, exceptions or offsets that may be available from
time to time to the applicable Lender. The rate of
interest on Advances shall be adjusted automatically on and as
of the effective date of any change in the Applicable Reserve
Requirement.
“
Approved
Electronic Communications ” shall mean any
notice, demand, communication, information, document or other
material that the Borrower provides to the Agent pursuant to
this Agreement or the transactions contemplated herein which
is distributed to the Agent or to the Lenders by the means of
electronic communications pursuant to Section
9.02(b).
“
Approved
Fund ” shall have the meaning ascribed to such
term in Section 9.05(c).
“
Assignee
” shall have the meaning ascribed to such term in
Section 9.05(c).
“
Assignment
and Acceptance ”
shall mean an assignment and acceptance entered into by a
Lender and an assignee (with the consent of any party whose
consent is required hereby), and accepted by the Agent, in
substantially the form of Exhibit A
.
“
Available
Amount ” shall have the meaning ascribed to such
term in Section 2.03(b).
“
Available
Commitment ”
shall mean, as of any date, an amount equal to the excess, if
any, of (i) the amount of the Total Commitment over (ii)
the Aggregate Outstanding Advances.
“
Availability
Date ” shall have the meaning ascribed to such
term in Section 2.03(b).
“
Availability
Notice ” shall have the meaning ascribed to such
term in Section 2.03(b).
“
Bankruptcy
Code ” shall mean the Bankruptcy Reform Act of
1978, as heretofore and hereafter amended, and codified as 11
U.S.C. §§101 et
seq
.
“
Benefited
Lender ” shall have the meaning ascribed to such
term in Section 2.17(a).
“
Board
”
shall mean the Board of Governors of the Federal Reserve
System of the United States, or any successor
thereto.
“
Board
of Directors ”
shall mean the board of directors of the Borrower or any duly
authorized committee thereof.
“
Borrower
”
shall have the meaning given such term in the preamble
hereto.
“
Borrowing
Notice ” shall have the meaning ascribed to such
term in Section 2.04(b).
“
Business
Day ”
shall mean any day (other than a day that is a Saturday,
Sunday or legal holiday in the State of New York) on which
banks are open for business in New York City; provided
,
however , that, when used
in connection with (i) any interest rate settings as to an
Advance or (ii) any fundings, disbursements or settlements in
respect of any such Advance, the term “Business
Day” shall exclude any day on which banks are not open
for dealings in dollar deposits in the London interbank
market.
“
Calculation
Agent Determination ” shall have the meaning
ascribed to such term in the Commodity Definitions, it being
understood that any reference to “Calculation
Agent” therein shall mean the Borrower.
“
Change
of Control ”
shall be deemed to have occurred upon (i) the acquisition
after the Closing Date of ownership, directly or indirectly,
beneficially or of record, by any Person or group (within the
meaning of the Exchange Act and the rules of the SEC
thereunder as in effect on the date hereof) of shares
representing more than 50% of the aggregate ordinary voting
power represented by the issued and outstanding capital stock
of the Borrower; (ii) the occupation of a majority of seats
(other than vacant seats) on the Board of Directors by Persons
who were neither nominated by the Board of Directors on the
Closing Date or appointed or nominated by directors so
nominated; or (iii) the occurrence of a Specified Change of
Control; provided
that no Change of Control shall be deemed to have occurred as
a result of the consummation of a Plan of
Reorganization.
“
Charges
” shall have the meaning ascribed to such term in
Section 9.14.
“
Closing
Date ”
shall mean the date of the Initial Advance
hereunder.
“
Closing
Date MTM
Exposure ” shall have the meaning ascribed to
such term in Section 2.03(a).
“
Code
”
shall mean the Internal Revenue Code of 1986, as the same may
be amended from time to time, including (unless the context
requires otherwise) any rules or regulations promulgated
thereunder.
“
Collateral
” shall have the meaning ascribed to such term in the
Existing Facility Credit Agreement.
“
Collateral
Agency and Intercreditor Agreement ” shall have
the meaning ascribed to such term in the Existing Facility
Credit Agreement.
“
Collateral
Agent ” shall mean have the meaning ascribed to
such term in the Existing Facility Credit
Agreement.
“
Collateral
Requirements ” shall have the meaning ascribed to
such term in the Existing Facility Credit
Agreement.
“
Combined
MTM Exposure ” shall mean, for each Computation
Date, an amount calculated by the Borrower (or, if the
Borrower fails to make such calculation, the Agent) equal to
the mark-to-market exposure (i.e., unrealized gain or loss)
that a single counterparty in the position of the “fixed
price” payor (or an equivalent position) would have on a
combined basis for all of the Deemed Transactions (inclusive
of unpaid settlement amounts, but not termination amounts) as
of such Computation Date; provided that if such single
counterparty would be “out-of-the-money” (i.e.,
would have an unrealized loss) on the Deemed Transactions,
then the MTM Exposure shall equal zero.
“
Commitment
”
shall mean, (a) with respect to each Lender that is a Lender
on the date hereof, the amount set forth opposite such
Lender’s name on Schedule 2.01 and (b) in the case of
any Lender that becomes a Lender after the date hereof, the
amount specified as such Lender’s
“Commitment” in the Assignment and Acceptance
pursuant to which such Lender assumed a portion of the Total
Commitment. The Total Commitment and accordingly,
the Commitment of each Lender, may be permanently terminated
or reduced from time to time pursuant to Section 2.13 or
modified from time to time pursuant to Section
9.05. The Commitment of each Lender shall
automatically and permanently terminate on the Commitment
Termination Date if not terminated earlier pursuant to the
terms hereof.
“
Commitment
Fee ”
shall have the meaning provided in Section
2.08(a).
“
Commitment
Fee Rate ”
shall mean, with respect to the Available Commitment, on any
date, 1.50% per annum.
“
Commitment
Maturity Date ” shall mean the date that is two
years after the Closing Date, or if such date is not a
Business Day, the next succeeding Business Day.
“
Commitment
Percentage ” shall mean at any time, for each
Lender, the percentage obtained by dividing (a) such
Lender’s Commitment at such time by (b) the amount of
the Total Commitment at such time; provided
that at any time when the Total Commitment shall have been
terminated, each Lender’s Commitment Percentage shall be
the percentage obtained by dividing (a) such Lender’s
Credit Exposure at such time by (b) the Credit Exposure of all
Lenders at such time.
“
Commitment
Reduction ” shall have the meaning provided in
Section 2.13(c).
“
Commitment
Termination Date ” shall mean the earlier to
occur of (a) the Commitment Maturity Date and (b) the date on
which the Commitments shall have terminated in accordance with
the terms hereof.
“
Commodity
Definitions ” shall mean the 2005 ISDA Commodity
Definitions, as published by the International Swaps and
Derivatives Association, Inc., without giving effect
to
any
amendment, supplement, updating or restatement thereof after
the Closing Date unless otherwise agreed to by the Borrower
and the Agent.
“
Commodity
Hedge Agreements ” shall mean any agreement
providing for swaps (including without limitation heat rate
swaps), caps, collars, puts, calls, floors, futures, options,
spots, forwards, power purchase, tolling or sale agreements,
fuel purchase or sale agreements, emissions credit purchase or
sales agreements, power transmission agreements, fuel
transportation agreements, fuel storage agreements, netting
agreements, or commercial or trading agreements, each with
respect to, or involving the purchase, transmission,
distribution, sale, lease or hedge of, any energy, generation
capacity or fuel, or any other energy related commodity or
service, price or price indices for any such commodities or
services or any other similar derivative agreements, and any
other similar agreements, entered into in the ordinary course
of business in order to manage fluctuations in the price or
availability of any commodity.
“
Communications
” shall have the meaning set forth in Section
9.17(a).
“
Computation
Date ” shall mean (i) with respect to the Closing
Date MTM Exposure, the Business Day preceding the Closing Date
and (ii) thereafter, any each Monday or if such Monday is not
a Business Day, the first Business Day
thereafter.
“
Credit
Documents ” shall mean this Agreement, the
Security Documents, the Fee Letter and any amendment, waiver,
supplement or other modification to any of the
foregoing.
“
Credit
Exposure ” shall mean, with respect to any Lender
at any time, the sum of the aggregate principal amount of the
outstanding Advances of such Lender.
“
Deemed
Transactions ” shall have the meaning ascribed to
such term in Section 2.07(a).
“
Default
”
shall mean any event or condition which with notice, lapse of
time or both would constitute an Event of
Default.
“
Default
Rate ” shall have the meaning ascribed to such
term in Section 2.11(b).
“
Defaulting
Lender ” shall mean any Lender that (a) has
failed to fund any portion of the Advances required to be
funded by it hereunder within one Business Day of the date
required to be funded by it hereunder, unless such failure has
been cured, (b) has otherwise failed to pay over to the Agent
or any other Lender any other amount required to be paid by it
hereunder within one Business Day of the date when due, unless
the subject of a good faith dispute or unless such failure has
been cured, or (c) has been deemed insolvent or become the
subject of a bankruptcy or insolvency proceeding.
“
dollars
”
or “ $
”
shall mean lawful money of the United States of
America.
“
Disruption
Fallbacks ” shall mean, in such order, Fallback
Reference Price, Postponement, Negotiated Fallback, Fallback
Reference Dealers and Calculation Agent
Determination.
“
Eligible
Commodity Hedge Agreement ” shall mean (i) any
agreement in effect on the Closing Date that constituted
(immediately prior to the Closing Date) an “Eligible
Commodity Hedge Agreement” as defined in the Existing
DIP Agreement, and (ii) any Commodity Hedge Agreement entered
into (or amended) by any Loan Party with a counterparty from
time to time in the ordinary course of business, consistent
with Prudent Industry Practice and not for speculative
purposes, it being understood that whether a Commodity Hedging
Agreement satisfies the criteria in this clause (ii) shall be
determined at the time such agreement is entered into and/or
amended. For the avoidance of doubt, the following
transactions shall always be considered speculative and not be
included in clause (ii) hereof: (i) any fixed price purchase
of fuel that does not have an associated fixed price
electricity sale; (ii) any fixed price sale of electricity
that does not have an associated fixed price fuel purchase or
is not used to hedge the heat rate differential between the
Projects and the market or used to hedge any geothermal or
storage Project; and (iii) any fixed price sale of fuel, other
than forward sales of fuel to hedge the heat rate differential
between the Borrower’s (and its Subsidiaries’)
Projects and the market or used to hedge any geothermal or
storage Project.
“
Eligible
Commodity Hedge Financing ” shall mean any letter
of credit and/or revolving loan facility (including a
commodity collateral revolving loan facility) that is entered
into by a Loan Party so long as (i) such letters of credit or
the proceeds of such facility are applied solely to
collateralize obligations of the Loan Parties to the
counterparties under the Eligible Commodity Hedge Agreements
to the extent that such counterparties are not otherwise
secured by the Collateral and (ii) the obligations of the Loan
Parties under such facility are secured by the Collateral
pursuant to Section 6.02(n) on a pari passu basis with the
Eligible Commodity Hedge Agreements and are not secured by any
other assets of the Loan Parties.
“
ERCOT
MTM Exposure ” shall mean, for each Computation
Date, an amount calculated by the Borrower (or, if the
Borrower fails to make such calculation, the Agent) equal to
the mark-to-market exposure (i.e., unrealized gain or loss)
that a single counterparty in the position of the “fixed
price” payor (or an equivalent position) would have on a
combined basis for all of the Deemed ERCOT Transactions
(inclusive of unpaid settlement amounts, but not termination
amounts) as of such Computation Date; provided that if such
single counterparty would be “out-of-the-money”
(i.e., would have an unrealized loss) on the Deemed ERCOT
Transactions, then the ERCOT MTM Exposure shall equal
zero.
“
ERISA
”
shall mean the Employee Retirement Income Security Act of
1974, as the same may be amended from time to time, including
(unless the context requires otherwise) any rules or
regulations promulgated and any rulings issued
thereunder.
“
Event
of Default ”
shall have the meaning assigned to such term in Article VII,
provided that any requirement for the giving of notice, the
lapse of time, or both, has been satisfied.
“
Exchange
Act ”
shall mean the Securities Exchange Act of 1934, as amended
from time to time, and any successor statute.
“
Excluded
Provisions ” shall mean (i) Sections 3.02, 3.03,
3.05(b), 3.09, 3.11, 3.18, 3.21 5.07(a) and (f), 5.11,
6.01(a), 6.13(a) and 6.16 and (ii) Sections 3.04, 3.10 and
3.16 (only insofar
as
an amendment, modification, supplement, consent or waiver of
the Sections in clause (ii) relates to this Agreement as it is
directly or indirectly referred to therein).
“
Existing
Facility Administrative Agent ” shall mean the
“Administrative Agent” under (and as defined in)
the Existing Facility Credit Agreement.
“
Existing
Facility Credit Agreement ”
shall mean the Credit Agreement dated as of January 31, 2008
among the Borrower, the lenders party thereto, General
Electric Capital Corporation, as sub-agent, Goldman Sachs
Credit Partners L.P., Credit Suisse, Deutsche Bank Securities
Inc. and Morgan Stanley Senior Funding, Inc., as
co-syndication agents and co-documentation agents, and Goldman
Sachs Credit Partners L.P., as administrative agent and
collateral agent, as amended, modified or supplemented from
time to time
“
Existing
Facility Lenders ”
shall mean the “Lenders” under (and as defined in)
the Existing Facility Credit Agreement.
“
Facility
”
shall have the meaning provided in the recitals to this
Agreement.
“
Fallback
Reference Dealers ” shall have the meaning set
forth in the Commodity Definitions.
“
Fallback
Reference Price ” shall have the meaning set
forth in the Commodity Definitions, it being understood that
any reference to “Calculation Agent” therein shall
mean the Borrower.
“
Fees
” shall mean
the arrangement fee and any other fees provided for in the Fee
Letter.
“
Fee
Letter ” shall mean that certain letter
agreement, dated the date hereof, among the Borrower, the
Lenders and GSCP as to the payment of certain
fees.
“
Financial
Officer ”
of any corporation or limited liability company shall mean the
chief financial officer, principal accounting officer,
controller or treasurer of such corporation or limited
liability company.
“
Global
Entities ” shall mean the collective reference to
the Borrower and its Restricted Subsidiaries.
“
Governmental
Authority ”
shall mean any nation or government, any state or other
political subdivision thereof, any agency, authority,
instrumentality, regulatory body, court, central bank or other
entity exercising executive, legislative, judicial, taxing,
regulatory or administrative functions of or pertaining to
government, any securities exchange and any self-regulatory
organization (including the National Association of Insurance
Commissioners).
“
Guarantee
and Collateral Agreement ” shall have the meaning
ascribed to such term in the Existing Facility Credit
Agreement.
“
Guarantee
Obligation ” shall have the meaning ascribed to
such term in the Existing Facility Credit
Agreement.
“
Guarantor
” shall have the meaning ascribed to such term in the
Existing Facility Credit Agreement.
“
Indebtedness
” of any Person at any date, shall mean, without
duplication, (a) all indebtedness of such Person for borrowed
money, (b) all obligations of such Person for the deferred
purchase price of property or services (other than current
trade payables incurred in the ordinary course of such
Person’s business), (c) all obligations of such Person
evidenced by notes, bonds, debentures or other similar
instruments, (d) all indebtedness created or arising under any
conditional sale or other title retention agreement with
respect to property acquired by such Person (even though the
rights and remedies of the seller or lender under such
agreement in the event of default are limited to repossession
or sale of such property), (e) all Capital Lease Obligations
of such Person, (f) all obligations of such Person, contingent
or otherwise, as an account party or applicant under or in
respect of acceptances, letters of credit, surety bonds or
similar arrangements, (g) the liquidation value of all
preferred Capital Stock of such Person, (h) all Guarantee
Obligations of such Person in respect of obligations of the
kind referred to in clauses (a) through (g) above, (i) all
obligations of the kind referred to in clauses (a) through (h)
above secured by (or for which the holder of such obligation
has an existing right, contingent or otherwise, to be secured
by) any Lien on property (including accounts and contract
rights) owned by such Person, whether or not such Person has
assumed or become liable for the payment of such obligation,
and (j) all obligations of such Person in respect of Swap
Agreements. The Indebtedness of any Person shall include the
Indebtedness of any other entity (including any partnership in
which such Person is a general partner) to the extent such
Person is liable therefor as a result of such Person’s
ownership interest in or other relationship with such entity,
except to the extent the terms of such Indebtedness expressly
provide that such Person is not liable
therefor. For purposes hereof, preferred Capital
Stock issued by the Borrower shall not constitute Indebtedness
hereunder unless it constitutes Disqualified Capital
Stock.
“
Indemnitee
” shall have the meaning ascribed to such term in
Section 9.06(c).
“
Initial
Advance ” shall have the meaning ascribed to such
term in Section 2.03(a).
“
Interest
Payment Date ” shall mean the last day of each
March, June, September and December commencing with September
30, 2008 (or if such day is not a Business Day, the Interest
Payment Date shall be the next Business Day thereafter unless
the result of such extension would be to carry the Interest
Period into another calendar month in which event the Interest
Payment Date shall be the immediately preceding Business
Day).
“
Interest
Period ”
shall mean, with respect to each Advance, (i) initially, the
period commencing on (and including) the Closing Date (in the
case of the Initial Advance) or the Advance Date (in the case
of any other Advance) to (but excluding) the first Interest
Payment Date following the Closing Date or such Advance Date
and (ii) thereafter, each period commencing on (and including)
an Interest Payment Date to (but excluding) the next Interest
Payment Date.
“
Investment
” shall have the meaning set forth in Section
6.06.
“
Junior
Lien Agreement ” shall have the meaning ascribed
to such term in the Existing Facility Credit
Agreement.
“
Junior
Lien Indebtedness ” shall have the meaning
ascribed to such term in the Existing Facility Credit
Agreement.
“
Lead
Arranger ”
shall mean GSCP.
“
Lenders
”
shall have the meaning given such term in the preamble
hereto.
“
LIBO
Rate ” shall mean, for any Interest Period, the
rate per annum obtained by dividing (i) (a) the rate per annum
(rounded to the nearest 1/100 of 1%) equal to the rate
determined by Agent to be the offered rate which appears on
the page of the Reuters Screen which displays an average
British Bankers Association Interest Settlement Rate (such
page currently being LIBOR01 page) for deposits (for delivery
on the first day of such period) with a term equivalent to
such period in dollars, determined as of approximately 11:00
a.m. (London, England time) on the date that is two Business
Days prior to the commencement of such Interest Period, or (b)
in the event the rate referenced in the preceding clause (a)
does not appear on such page or service or if such page or
service shall cease to be available, the rate per annum
(rounded to the nearest 1/100 of 1%) equal to the rate
determined by Agent to be the offered rate on such other page
or other service which displays an average British Bankers
Association Interest Settlement Rate for deposits (for
delivery on the first day of such period) with a term
equivalent to such period in dollars, determined as of
approximately 11:00 a.m. (London, England time) on the date
that is two Business Days prior to the commencement of such
Interest Period, or (c) in the event the rates referenced in
the preceding clauses (a) and (b) are not available, the rate
per annum (rounded to the nearest 1/100 of 1%) equal to the
offered quotation rate to first class banks in the London
interbank market by JPMorgan Chase Bank, N.A. for deposits
(for delivery on the first day of the relevant period) in
dollars of amounts in same day funds comparable to the
principal amount of the applicable Advance of the Agent, in
its capacity as a Lender, for which the LIBO Rate is then
being determined with maturities comparable to such period as
of approximately 11:00 a.m. (London, England time) on the date
that is two Business Days prior to the commencement of such
Interest Period, by (ii) an amount equal to (a) one minus (b)
the Applicable Reserve Requirement (provided that, if the
relevant period is not a one week, one month, two month or
three month period and, in the case of clauses (i)(a), (b) or
(c) above, there are rates for such other periods, then the
LIBO Rate for such relevant period shall be determined by
straight line interpolation using the rates for the two other
periods that are closest in duration to such relevant
period)
“
Lien
”
shall mean any mortgage, pledge, hypothecation, assignment,
deposit arrangement, encumbrance, lien (statutory or other),
charge or other security interest or any preference, priority
or other security agreement or preferential arrangement of any
kind or nature whatsoever (including any conditional sale or
other title retention agreement and any capital lease having
substantially the same economic effect as any of the
foregoing).
“
Limited
Recourse Debt ” shall have the meaning ascribed
to such term in the Existing Facility Credit
Agreement.
“
Loan
Party ” shall have the meaning ascribed to such
term in the Existing Facility Credit Agreement.
“
Market
Disruption Event ” shall have the meaning as set
forth in Section 7.04(d)(i) of the Commodity Definitions
without giving effect to Section 7.05(e) thereof.
“
Material
Adverse Effect ”
shall mean a material adverse effect on (a) the business,
condition (financial or otherwise), operations or assets of
the Global Entities taken as a whole, in each case, other than
such effects attributable to the consummation of the
transactions contemplated by the Plan of Reorganization, the
occurrence of the Plan Effective Date and, in the case of time
periods during the pendency of the Cases, the commencement of
the Cases or the existence of prepetition claims and of
defaults under such prepetition claims, (b) the validity or
enforceability of the Credit Documents, or (c) the rights and
remedies of the Lenders, the Agent and the Collateral Agent
under the Credit Documents, taken as a whole.
“
Material
Obligor ” shall have the meaning ascribed to such
term in the Existing Facility Credit Agreement.
“
Maximum
Amount ” shall mean, as of any day, (i)
US$300,000,000 minus (ii) the aggregate amount of Commitment
Reductions pursuant to Section 2.13(c) hereof.
“
Maximum
Rate ” shall have the meaning ascribed to such
term in Section 9.14(a).
“
Minimum
Amount ” shall mean, as of any day, (i)
US$100,000,000 minus (ii) the aggregate amount of all
Commitment Reductions pursuant to Section 2.13(c) hereof;
provided that if the foregoing results in a negative amount,
then such Minimum Amount shall equal zero.
“
MTM
Exposure ” shall mean, for each Computation Date,
the greatest of (i) the ERCOT MTM Exposure, (ii) the NP-15 MTM
Exposure and (iii) Combined MTM Exposure.
“
MTM
Notice ” shall have the meaning ascribed to such
term in Section 2.02(a).
“
Negotiated
Fallback ” shall have the meaning set forth in
Section 7.05(c)(iii) of the Commodity Definitions; provided
, however, the word “fifth” shall be replaced with
the word “third”.
“
Non-Defaulting
Lender ” shall mean and include each Lender other
than a Defaulting Lender.
“
Non-Excluded
Taxes ” shall have the meaning ascribed to such
term in Section 2.19(a).
“
Non-Loan
Parties ” shall have the meaning ascribed to such
term in the Existing Facility Credit Agreement.
“
Non-U.S.
Lender ” shall have the meaning ascribed to such
term in Section 2.19(d).
“
NP-15
MTM Exposure ” shall mean, for each Computation
Date, an amount calculated by the Borrower (or, if the
Borrower fails to make such calculation, the Agent) equal to
the
mark-to-market
exposure (i.e., unrealized gain or loss) that a single
counterparty in the position of the “fixed price”
payor (or an equivalent position) would have on a combined
basis for all of the Deemed NP-15 Transactions (inclusive of
unpaid settlement amounts, but not termination amounts) as of
such Computation Date; provided that if such single
counterparty would be “out-of-the-money” (i.e.,
would have an unrealized loss) on the Deemed NP-15
Transactions, then the NP-15 MTM Exposure shall equal
zero.
“
Obligations
” shall mean the unpaid principal of and interest on
(including interest accruing after the maturity of the
Advances and interest accruing after the filing of any
petition in bankruptcy, or the commencement of any insolvency,
reorganization or like proceeding, relating to the Borrower,
whether or not a claim for post-filing or post-petition
interest is allowed in such proceeding) the Advances and all
other obligations and liabilities of the Borrower to the Agent
or to any Lender, whether direct or indirect, absolute or
contingent, due or to become due, or now existing or hereafter
incurred, which may arise under, out of, or in connection
with, this Agreement, any other Credit Document or any other
document made, delivered or given in connection herewith or
therewith, whether on account of principal, interest,
reimbursement obligations, fees, indemnities, costs, expenses
(including all fees, charges and disbursements of counsel to
the Agent or to any Lender that are required to be paid by the
Borrower pursuant hereto) or otherwise.
“
Original
Lender ” shall have the meaning ascribed to it in
Article VIII (a).
“
Other
Taxes ” shall mean any and all present or future
stamp or documentary taxes or any other excise or property
taxes, charges or similar levies arising from any payment made
hereunder or from the execution, delivery or enforcement of,
or otherwise with respect to, this Agreement or any other
Credit Document.
“
Outstanding
Advances ” shall mean with respect to any Lender,
on any date of determination, an amount equal to the aggregate
principal amount of all outstanding Advances made by such
Lender.
“
Participant
” shall have the meaning ascribed to it in Section
9.05(d).
“
Payment
Instructions ” shall mean standing instructions
or ad
hoc instructions provided by the Borrower to the Agent
and approved by the Agent (such approval not to be
unreasonably withheld, conditioned or delayed).
“
Pending
Advance ” shall mean any Advance for which notice
has been given by the Borrower pursuant to Section 2.04(b),
but which has not yet been advanced hereunder.
“
Permitted
Acquisition ” shall have the meaning ascribed to
such term in the Existing Facility Credit
Agreement.
“
Permitted
Liens ” shall mean Liens permitted to exist under
Section 6.02.
“
Permitted
Refinancing ” shall have the meaning ascribed to
such term in the Existing Facility Credit
Agreement.
“
Person
” shall mean an individual, partnership, corporation,
limited liability company, business trust, joint stock
company, trust, unincorporated association, joint venture,
Governmental Authority or other entity of whatever
nature.
“
Platform
” shall have the meaning ascribed to such term in
Section 5.01.
“
Postponement
” shall have the meaning set forth in the Commodity
Definitions with two (2) Commodity Business Days as the
Maximum Days of Disruption (each as such term is defined in
the Commodity Definitions).
“
Public
Lender ” shall have the meaning ascribed to such
term in Section 9.16.
“
Projections
” shall have the meaning ascribed to such term in
Section 5.02(c).
“
Refinancing
” shall have the meaning ascribed to such term in the
Existing Facility Credit Agreement.
“
Register
”
shall have the meaning ascribed to such term in Section
9.05(c)(iv).
“
Regulation
D ” means Regulation D of the Board, as in effect
from time to time.
“
Related
Advance Date ” shall mean, with respect to any
Computation Date, the first Business Day to occur after the
next Computation Date.
“
Repayment
Premium ” shall have the meaning ascribed to such
term in Section 2.12(a).
“
Required
Lenders ”
shall mean, at any date, Non-Defaulting Lenders holding a
majority of the Adjusted Total Commitment as of such date or
if the Total Commitment has been terminated at such time,
Non-Defaulting Lenders holding a majority of the Credit
Exposure (excluding the Credit Exposure of Defaulting Lenders)
at such time.
“
Responsible
Officer ”
of any corporation or limited liability company shall mean the
chief executive officer, president, any executive vice
president or Financial Officer of such corporation or limited
liability company, but in any event, with respect to financial
matters, a Financial Officer.
“
Restricted
Payments ” shall have the meaning ascribed to
such term in Section 6.05.
“
SEC
”
shall mean the Securities and Exchange
Commission.
“
Secured
Parties ” shall have the meaning ascribed to such
term in the Guarantee and Collateral Agreement.
“
Security
Documents ” shall have the meaning ascribed to
such term in the Existing Facility Credit
Agreement.
“
Solvent
”
shall mean, when used with respect to any Person and its
Subsidiaries, as of any date of determination, (a) the amount
of the “present fair saleable value” of the assets
of such Person and its Subsidiaries on a consolidated basis
will, as of such date, exceed the amount of all
“liabilities
of such Person and its Subsidiaries on a consolidated basis,
contingent or otherwise”, as of such date, as such
quoted terms are determined in accordance with applicable
federal and state laws governing determinations of the
insolvency of debtors, (b) the present fair saleable value of
the assets of such Person and its Subsidiaries will, as of
such date, be greater than the amount that will be required to
pay the probable liability of such Person and its Subsidiaries
on a consolidated basis on its debts as such debts become
absolute and matured, (c) such Person and its Subsidiaries on
a consolidated basis will not have, as of such date, an
unreasonably small amount of capital with which to conduct
their business, and (d) such Person and its Subsidiaries will
be able to pay their debts as they mature. For
purposes of this definition, (i) “debt” means
liability on a “claim”, and (ii)
“claim” means any (x) right to payment, whether or
not such a right is reduced to judgment, liquidated,
unliquidated, fixed, contingent, matured, unmatured, disputed,
undisputed, legal, equitable, secured or unsecured or (y)
right to an equitable remedy for breach of performance if such
breach gives rise to a right to payment, whether or not such
right to an equitable remedy is reduced to judgment, fixed,
contingent, matured or unmatured, disputed, undisputed,
secured or unsecured.
“
Specified
Swap Agreement ” shall mean any Swap Agreement in
respect of interest rates or currency exchange rates entered
into by the Borrower or any Guarantor and any Person that is
an Existing Facility Lender or an affiliate of an Existing
Facility Lender at the time such Swap Agreement is entered
into.
“
Spread”
shall mean 2.875% (287.5 basis points).
“
Subsidiary
”
shall mean as to any Person, a corporation, partnership,
limited liability company or other entity of which shares of
stock or other ownership interests having ordinary voting
power (other than stock or such other ownership interests
having such power only by reason of the happening of a
contingency) to elect a majority of the board of directors or
other managers of such corporation, partnership or other
entity are at the time owned, or the management of which is
otherwise controlled, directly or indirectly through one or
more intermediaries, or both, by such Person. Unless otherwise
qualified, all references to a “Subsidiary” or to
“Subsidiaries” in this Agreement shall refer to a
Subsidiary or Subsidiaries of the Borrower.
“
Subordinated
Indebtedness ” shall have the meaning ascribed to
such term in the Existing Facility Credit
Agreement.
“
Subordinated
Indebtedness Agreement ” shall have the meaning
ascribed to such term in the Existing Facility Credit
Agreement.
“
Swap
Agreement ” shall mean 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 (including, without limitation, Commodity Hedge
Agreements); 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 ”.
“
Target
Advance Level ” shall mean, as of any Computation
Date, the greater of (i) the Minimum Amount and (ii) the MTM
Exposure; provided
that if the MTM Exposure for that Computation Date exceeds the
Maximum Amount, the Target Advance Level shall equal the
Maximum Amount.
“
Total
Commitment ” shall mean the sum of the
Commitments of all the Lenders. The aggregate
amount of Commitments as of the date hereof is
US$300,000,000.
“
Trading
Affiliates ” shall have the meaning ascribed to
such term in Section 9.21.
“
Transferee
” shall mean any Assignee or Participant.
“
Unsecured
Commodity Liquidity Facility ” shall mean
(a) the letter of credit facility under that certain
Letter of Credit Facility Agreement (Natural Gas) dated as of
June 25, 2008 between the Borrower and Morgan Stanley
Capital Services Inc., as amended, supplemented or otherwise
modified from time to time, and (b) any other liquidity
facility entered into by a Loan Party (and not guaranteed,
directly or indirectly, by any Subsidiary that is not a Loan
Party), so long as (i) the amount of borrowings available to
be made to any such Loan Party is (at the time such facility
is entered into) positively correlated with the price of
natural gas and/or power, (ii) the aggregate principal amount
of all such facilities shall not exceed $300,000,000 at any
one time outstanding and (iii) the obligations of all Loan
Parties (whether acting as a borrower or a guarantor) under
all such facilities are unsecured.
(b)
The
following terms shall have the meanings ascribed to such terms in
the Existing Facility Credit Agreement prior to giving effect to
any amendments to such agreement on or after the date hereof unless
modified pursuant to Section 9.01(c) below: “ Additional
First Priority Term Loans ”; “ Bankrupt
Subsidiary ”; “ Bankruptcy
Court ”; “ Blue
Spruce Refinancing Facility ”; “ Bridge
Loan Documents ”; “ Bridge
Loan Facility ”; “ Bridge
Loans ”; “ CalGen
Makewhole Payment ”; “ Capital
Expenditure ”; “ Capital
Lease Obligations ”; “ Capital
Stock ”; “ Case
”; “ Cash
Equivalents ”; “ CCFC
Guaranty ”; “ Commonly
Controlled Entity ”; “ Consolidated
EBITDA ”; “ Consolidated
Interest Coverage Ratio ”; “ Consolidated
Interest Expense ”; “ Consolidated
Leverage Ratio ”; “ Consolidated
Senior Leverage Ratio ”; “ Compliance
Certificate ”; “ Contractual
Obligation ”; “ Confidential
Information Memorandum ”; “ Disposition
”; “ Disqualified
Capital Stock ”; “ Domestic
Subsidiary ”; “ Eligible
Facility ”; “ Environmental
Laws ”; “ ERISA
Reorganization ”; “ Excess
Cash Flow ”; “ Excluded
Subsidiary ”; “ Existing
DIP Agreement ”; “ First
Priority Term Loans ”; “ Foreign
Subsidiary ”; “ Freeport
Guaranty ”; “ GAAP
”; “ Global
Entity ”; “ Greenfield
Guaranty ”; “ Geysers
Entities ”; “ Incremental
Term Loans ”; “ Insolvency
”; “ Intellectual
Property ”; “ Investment
”; “ Loan
”; “ Materials
of Environmental Concern ”; “ Metcalf
Refinancing Facility ”; “ Moody’s
”; “ Multiemployer
Plan ”; “ Net Cash
Proceeds ”; “ Pasadena
Guaranty ”; “ PBGC
”; “ Performance
Guarantee ”; “ Permitted
PPA Counterparty Lien ”; “ Pittsburg/
DEC/LMEC Guaranty ”; “ Plan
”; “ Plan
Effective Date ”; “ Plan of
Reorganization ”; “ PPA
Intercreditor Agreement ”; “ Project
”; “ Project
Investments ”; “ Project
Subsidiary ”; “ Prudent
Industry Practice ”; “ Reinvestment
Deferred Amounts ”; “ Reportable
Event ”; “ Reorganization
”; “ Requirements
of Law ”;
“
Restricted
Subsidiaries ”; “ S&P
”; “ Single
Employer Plan ”; “ Solvent
”; “ Specified
Change of Control ”; “ Stated
Maturity ”; “ Unrestricted
”; and “ Wholly
Owned Guarantor ”.
(c)
With
respect to those definitions in Section 1.01(a) or (b) that
incorporate definitions used in the Existing Facility Credit
Agreement (“ Incorporated
Definitions ”), such Incorporated Definitions shall
have the meanings ascribed to such terms in the Existing Facility
Credit Agreement, on the date hereof unless (i) otherwise agreed by
the Agent on behalf of the Lenders or (ii) modified pursuant to
Section 9.01(c) below.
SECTION 1.02.
Terms Generally .
The
definitions in Section 1.01 shall apply equally to both the
singular and plural forms of the terms
defined. Whenever the context may require, any
pronoun shall include the corresponding masculine, feminine
and neuter forms. The words “include,”
“includes” and “including” shall be
deemed to be followed by the phrase “without
limitation.” All references herein to Articles,
Sections, Exhibits, Schedules and Annexes shall be deemed
references to Articles and Sections of, and Exhibits,
Schedules and Annexes to, this Agreement unless the context
shall otherwise require. Except as otherwise
expressly provided herein, all terms of an accounting or
financial nature shall be construed in accordance with GAAP,
as in effect from time to time. Unless otherwise
stated, reference to any time means New York City
time.
ARTICLE II
ADVANCES AND REPAYMENTS
SECTION 2.01.
Commitments .
(a)
Subject
to the terms and conditions and relying upon the representations
and warranties herein set forth, each Lender agrees, severally and
not jointly, to make, based on such Lender’s Commitment,
Advances to the Borrower on each Advance Date (so long as the
Borrower shall request such Advance as provided below) until the
Commitment Termination Date; provided that
no Advance shall (i) for any Lender at any time, after giving
effect thereto and to the application of the proceeds thereof,
result in such Lender’s Credit Exposure at such time
exceeding such Lender’s Commitment at such time and (ii)
after giving effect thereto and to the application of the proceeds
thereof, result at any time in the aggregate amount of the
Lenders’ Credit Exposures at such time exceeding the Total
Commitment then in effect. Such Advances may be repaid
and amounts repaid may be reborrowed, all in accordance with the
terms hereof.
(b)
The
Borrower will borrow and repay Advances on and after the date
hereof and prior to the Commitment Termination Date subject to the
terms, conditions and limitations set forth herein.
SECTION 2.02.
Computation of MTM Exposure.
(a)
By
no later than 7:00 p.m., New York City time, on each Computation
Date (unless it has been prevented from doing so due to technical
delay or failure or as a result of a Market Disruption Event), the
Borrower shall determine the MTM Exposure as of the close
of
business
on such Business Day. Promptly after making such
determination, it shall advise the Agent and the Lenders of
that determination (each, an “ MTM
Notice ”) (which MTM Notice shall be provided via
email). If a Market Disruption Event has occurred,
then the Borrower shall, as promptly as reasonably
practicable, determine the MTM Exposure in accordance with the
Disruption Fallbacks and any other relevant provisions of the
Commodity Definitions. If such determination is
prevented due to a technical delay or failure, the Borrower
shall make such determination as promptly as reasonably
practicable after such matter is remedied. If the
Borrower fails to make such calculation in with the foregoing,
then the Agent shall make such determination in the manner
contemplated by Sections 2.02(b) and (c) below.
(b)
The
Agent shall promptly review each MTM Notice received by it from the
Borrower and advise the Borrower whether it agrees or disagrees
with the computation of the MTM Exposure set forth therein by no
later than 12:00 Noon, New York City time, on the first Business
Day following the related Computation Date. In the event
the Agent disagrees (and has a reasonable basis for disagreeing)
with such computation, the parties shall promptly endeavor to
resolve such disagreement. If the parties are unable to resolve
such disagreement within one Business Day, then (i) until such
disagreement is resolved, the amount determined by the Agent shall
be effective for purposes hereof and (ii) the parties shall
mutually select a dealer (with respect to commodity related
calculations) or a financial institution (with respect to financial
calculations) that customarily acts as a calculation agent for
similar transactions to calculate such MTM Exposure. If
the parties cannot agree on a dealer or bank within one (1)
Business Day, then each party shall appoint a dealer or bank and
the appointed dealers or banks shall together appoint a third
dealer or bank as calculation agent for making the relevant
determination, and the decision of such party shall be final and
binding upon the parties. The leading dealers or
financial institutions selected by a party shall not be parties to
this Agreement or Affiliates of a party to this
Agreement.
(c)
Without
limiting Section 2.02(a) or (b) above, the Borrower acknowledges
that in reviewing the calculation of the MTM Exposure hereunder,
the Agent may use the services of one or more its affiliated
entities and any determination by such affiliated entity shall be
deemed subject to the standard disclaimer relating to
mark-to-market calculations, a copy of which is set forth in
Exhibit
B hereto.
(d)
Any
calculation of the MTM Exposure made by either party shall be made
in the manner provided for in the Calculation Agent Determination
as if such party was the “Calculation Agent” referred
to therein.
SECTION 2.03.
Computation of Advance Amounts.
(a)
The
MTM Exposure shall be calculated as of the close of business on the
Computation Date immediately preceding the Closing Date (the
“ Closing
Date MTM Exposure ”). The amount of the
Advance to be made on the Closing Date shall equal the greater of
(i) US$100,000,000 and (ii) the Closing Date MTM Exposure (the
“ Initial
Advance ”).
(b)
On
the first Business Day after each Computation Date after the
Closing Date (each, an “ Availability
Date ”), the Agent shall determine whether the Target
Advance Level is greater than the Aggregate Outstanding Advances as
of that Computation Date. By no later than
12:00
Noon, New York City time, on each Availability Date (unless it
has been prevented from doing so due to a technical delay or
failure or as a result of a Market Disruption Event), the
Agent shall notify the Lenders and the Borrower (each such
notice, an “ Availability
Notice ”) of the amount, if any, by which such
Target Advance Level exceeds the sum of such Aggregate
Outstanding Advances and any Pending Advances (each such
excess, an “ Available
Amount ”; provided that if there is no such
excess, such Available Amount shall equal zero), which notice
may be provided via email.
SECTION 2.04.
Advances.
(a)
On
the Closing Date, subject to the terms and conditions and relying
upon the representations and warranties herein set forth, each
Lender shall advance to the Borrower such Lender’s portion,
based on its Commitment Percentage, of the Initial
Advance.
(b)
If
the Available Amount determined as of any Availability Date is
greater than zero, then the Borrower may borrow on the Related
Advance Date, subject to the terms and conditions and relying upon
the representations and warranties herein set forth, an Advance in
an amount up to but not exceeding such Available Amount; provided
that the Borrower shall give the Agent irrevocable notice (a
“ Borrowing
Notice ”) (which notice must be received by the Agent
prior to 12:00 Noon, New York City time on the first Business Day
following such Availability Date) specifying the amount of such
Advance to be borrowed, which amount shall be no less than
$5,000,000 and integral multiples of $100,000 in excess of such
amount. Each Borrowing Notice shall be substantially in
the form of Exhibit C
attached hereto.
(c)
Subject
to the terms and conditions and relying upon the representations
and warranties herein set forth, each Lender shall advance to the
Borrower such Lender’s portion, based on its Commitment
Percentage, of the Advance made on any Related Advance
Date. Promptly after receipt of any Borrowing Notice,
the Agent shall notify each Lender and the Borrower of the Advance
and such Lender’s proportionate share thereof.
(d)
All
Advances hereunder shall be made to the Borrower at: account no.
4430004366 Calpine Corporation – Commodity Collateral, ABA
no. 122 000 496 at Union Bank of California, Monterey Park, CA,
subject to any alternative Payment , as from time to time in
effect, to the Agent, in which case Advances hereunder shall be
made as provided therein. Subject to the foregoing, each
Lender shall make its portion of each Advance to be made by it
hereunder on the proposed date thereof by wire transfer of
immediately available funds to the Agent in New York, New York, not
later than 2:00 p.m., New York City time, and the Agent shall by
3:00 p.m., New York City time, credit the amounts so received to
the account or accounts specified from time to time in one or more
notices delivered by the Borrower to the Agent or, if an Advance
shall not occur on such date because any condition precedent herein
specified shall not have been met, return the amounts so received
to the respective Lenders.
(e)
Each
Advance shall be made by the Lenders ratably in accordance with
their respective Commitment Percentages; provided ,
however, that the failure of any Lender to make any Advance shall
not in itself relieve any other Lender of its obligation to lend
hereunder (it being understood, however, that (i) no Lender shall
be responsible for the failure of any other Lender to make any
Advance required to be made by such other Lender and each
Lender
severally
but not jointly shall be obligated to make the Advances
provided to be made by it hereunder, regardless of the failure
of any other Lender to fulfill its commitments hereunder and
(ii) failure by a Lender to perform any of its obligations
under any of the Credit Documents shall not release any Person
from performance of its obligations under any Credit
Document).
(f)
Unless
the Agent shall have received notice from a Lender prior to the
date of any Advance that such Lender will not make available to the
Agent such Lender’s portion of such Advance, the Agent may
assume that such Lender has made such portion available to the
Agent on the date of such Advance in accordance with subsection (c)
and the Agent may, in reliance upon such assumption, make available
to the Borrower on such date a corresponding amount. If
and to the extent that such Lender shall not have made such portion
available to the Agent, such Lender agrees to repay to the Agent
forthwith on demand such corresponding amount together with
interest thereon, for each day from the date such amount is made
available to the Borrower until the date such amount is repaid to
the Agent, at the interest rate applicable at the time to the
corresponding amounts comprising such Advance. If such
Lender shall repay to the Agent such corresponding amount, such
amount shall constitute such Lender’s portion of such Advance
for purposes of this Agreement. If such Lender’s
share of such Advance is not made available to the Agent by such
Lender within three (3) Business Days after demand therefor, the
Agent shall also be entitled to recover such amount with interest
thereon at the rate per annum applicable to Advances, on demand,
from the Borrower, such recovery to be without prejudice to the
rights of the Borrower against any such Lender.
SECTION 2.05.
Repayment of Advances by the Borrower .
On
the Commitment Termination Date, the Borrower shall repay to
the Lenders the Aggregate Outstanding Advances (including all
accrued and unpaid interest thereon, accrued Fees and other
Obligations incurred in respect thereof).
SECTION 2.06.
Payment Instructions.
From
time to time, the Borrower may establish with the Agent
Payment Instructions regarding the making of Advances
hereunder. So long as any such Payment Instruction
remains in effect, the terms thereof shall supersede any
conflicting terms set forth herein.
SECTION 2.07.
Deemed Transactions.
The
“ Deemed
Transactions ” shall consist of the ERCOT Deemed
Transactions and NP-15 Deemed Transactions.
The
“ ERCOT
Deemed Transactions ” shall consist of a
portfolio of hypothetical three year over-the-counter
fixed-for-floating heat rate swap transactions, with effective
dates occurring on the Closing Date, (i) under which the
Borrower (and its Restricted Subsidiaries) are, on a net
volume basis, the "floating price" payor (or have an
equivalent position) and which have net hourly volumes equal
to 1,833.33 MWh, with the Borrower delivering power for 5 days
and 16 peak hours (5x16) at Houston ERCOT and receiving an
aggregate amount of natural gas equal to 7.2 MMBtu
per MWh of Houston ERCOT power from Houston Ship Channel gas,
and also receiving USD $26.89 per MWh of Houston ERCOT power
and (ii) using the Floating Price
references
(including fallbacks) and natural gas price references
(including fallbacks) specified on Exhibit D
hereto.
The
“ NP-15
Deemed Transactions ” shall consist of a
portfolio of hypothetical three year over-the-counter
fixed-for-floating heat rate swap transactions, with effective
dates occurring on the Closing Date, (i) under which the
Borrower (and its Restricted Subsidiaries) are, on a net
volume basis, the "floating price" payor (or have an
equivalent position) and which have net hourly volumes equal
to 916.67 MWh, with the Borrower delivering power for 6 days
and 16 peak hours (6x16) at NP-15 and receiving 7.2 MMBtu per
MWh of NP-15 power from PG&E City-Gate gas and also
receiving USD $24.55 per MWh of NP-15 power and (ii) using the
Floating Price references (including fallbacks) and natural
gas price references (including fallbacks) specified on
Exhibit D hereto.
SECTION 2.08.
Fees .
(a)
The
Borrower agrees to pay to the Agent, for the account of the Lenders
(in each case pro
rata according to the respective Commitments of all such
Lenders), a commitment fee (the “ Commitment
Fee ”) for each day from the Closing Date to the
Commitment Termination Date. Each Commitment Fee shall
be payable by the Borrower (i) quarterly in arrears on the tenth
Business Day following the end of each March, June, September and
December (for the three-month period (or portion thereof) ended on
such day for which no payment has been received) and (ii) on the
Commitment Termination Date (for the period ended on such date for
which no payment has been received pursuant to clause (i)), and
shall be computed for each day during such period at a rate per
annum equal to the Commitment Fee Rate on the applicable portion of
the Available Commitment in effect on such day.
(b)
The
Borrower agrees to pay to the Agent, for the account of the Lenders
(in each case pro
rata according to the respective Commitments of all such
Lenders), the Fees as provided in the Fee Letter; provided that,
to the extent any Fee is required under the Fee Letter as well as
under this Agreement then such payment shall be made by the
Borrower without duplication.
(c)
All
Fees shall be paid on the dates due, in immediately available
funds, to the Agent for distribution, if and as appropriate, among
the Lenders. Once paid, none of the Fees shall be
refundable under any circumstances.
SECTION 2.09.
Evidence of Indebtedness.
(a)
Each
Lender shall maintain in accordance with its usual practice an
account or accounts evidencing the indebtedness to such Lender
resulting from each Advance made by such Lender from time to time,
including the amounts of principal and interest payable and paid to
such Lender from time to time under this Agreement.
(b)
The
Agent shall maintain accounts in which it will record (i) the
amount and date of each Advance made hereunder, (ii) the amount of
any principal or interest due and payable or to become due and
payable from the Borrower to each Lender hereunder and (iii) the
amount of any sum received by the Agent hereunder from the Borrower
and each Lender’s share thereof.
(c)
The
entries made in the accounts maintained pursuant to subsections (a)
and (b) above shall, to the extent permitted by applicable law, be
prima facie evidence of the existence and amounts of the
obligations therein recorded; provided
, however,
that the failure of any Lender or the Agent to maintain such
accounts or any error therein shall not in any manner affect the
obligations of the Borrower to repay the Outstanding Advances in
accordance with their terms. In the event of any
conflict between the accounts and records maintained by any Lender
and the accounts and records of the Agent in respect of such
matters, the accounts and records of the Agent shall control in the
absence of manifest error.
SECTION 2.10.
Computation of Interest.
(a)
Each
Advance shall bear interest for each day during each Interest
Period with respect thereto at a rate per annum equal to the LIBO
Rate applicable to that Interest Period plus the
Spread.
(b)
Interest
shall be computed on the basis of actual days elapsed over a year
of 360 days.
(c)
The
Agent shall compute the amount of interest due for each Interest
Period and shall notify the Borrower of such amount by no later
than 10:00 a.m., New York City time, on each Interest Payment
Date. Notice of such amount may be provided by email.
The Agent shall, at the request of the Borrower, deliver to the
Borrower a statement sharing the quotations (and, if applicable,
the calculations) used by the Agent in determining the interest
rate hereunder.
SECTION 2.11.
Payment of Interest.
(a)
On
each Interest Payment Date, the Borrower shall pay to the Agent,
for the account of the Lenders, the amount of interest applicable
to the Interest Periods ending on such Interest Payment Date as
computed pursuant to Section 2.10 of this Agreement.
(b)
If
all or a portion of (i) the principal amount of any Advance or (ii)
any interest payable thereon or any other amount hereunder shall
not be paid when due (whether at the stated maturity, by
acceleration or otherwise), such overdue amount shall bear interest
at a rate per annum (the “ Default
Rate ”) that is (x) in the case of overdue principal,
the rate that would be otherwise applicable thereto plus 2.0% or
(y) in the case of any overdue interest or other amounts due
hereunder, to the extent permitted by applicable law, the rate
described in Section 2.10(a) plus 2.0% from the date of such
non-payment to the date on which such amount is paid in full (after
as well as before judgment).
SECTION 2.12.
Repayments Prior to the Commitment Termination Date.
(a)
The
Borrower may repay Advances prior to the Commitment Termination
Date, without penalty, in whole or in part, from time to time on
and subject to the following terms and conditions: (i) the Borrower
shall give prior written notice (or telephonic notice, confirmed in
writing promptly) to the Agent of its intent to make such repayment
and the amount of such repayment, which notice shall be given by
the Borrower no later than 12:00 noon, New York City time on the
repayment date (which must be a Business Day), which notice shall
promptly be transmitted by the Agent to each Lender, (ii) each
repayment shall be in an aggregate principal
amount
of at least US$500,000 and in whole multiples of US$100,000 in
excess thereof; provided
that no partial prepayment shall reduce the Aggregate
Outstanding Advances to an amount less than US$100,000,000,
(iii) if the Commitments are not being concurrently reduced by
the amount of such repayment pursuant to Section 2.13(c)
below, then the Borrower shall concurrently with such
repayment pay to the Agent for the benefit of the Lenders a
premium equal to 5% of such repayment amount (each, a “
Repayment
Premium ”) and (iv) any such repayment pursuant
to this Section 2.12 on any day other than an Interest Payment
Date shall be on and subject to compliance by the Borrower
with the applicable provisions of Section
2.18(c).
(b)
In
lieu of making any payment pursuant to this Section 2.12 other than
on an Interest Payment Date so long as no Event of Default shall
have occurred and be continuing, the Borrower at its option may
deposit with the Agent the amount required to be repaid and the
Advances shall be repaid on the next Interest Payment Date in the
required amount. Such deposit shall be held by the Agent
in a corporate time deposit account established on terms reasonably
satisfactory to the Agent, earning interest at the then customary
rate for accounts of such type. Such deposit shall
constitute cash collateral for the Advances to be so prepaid;
provided that
the Borrower may at any time direct that such deposit be applied to
make the applicable payment required pursuant to this Section
2.12.
SECTION 2.13.
Termination and Reduction of Commitments .
(a)
The
Commitments shall terminate automatically on the Commitment
Termination Date.
(b)
Upon
at least two Business Days’ prior irrevocable written notice
to the Agent, the Borrower may at any time, in whole or in part
permanently terminate the Commitments. The Agent shall
advise the Lenders of any notice given pursuant to this subsection
(b).
(c)
In
connection with any repayment of any Advances pursuant to Section
2.12 above, the Borrower may, at its option, permanently reduce the
Commitments by the amount of such repayment (a “ Commitment
Reduction ”), with each Lender’s Commitment
being reduced by its share of such payment based on its Commitment
Percentage; provided that the Borrower shall notify the Agent of
such reduction in the notice of such repayment that it provides to
the Agent pursuant to Section 2.12.
(d)
The
Borrower shall pay to the Agent, for the account of the Lenders, on
the date of the termination of the Commitments, any Fees accrued
through the date of such termination.
SECTION 2.14.
Reserve Requirements; Change in Circumstances .
(a)
Notwithstanding
any other provision herein, if after the date of this Agreement any
change in applicable law or regulation or in the interpretation or
administration thereof by any Governmental Authority charged with
the interpretation or administration thereof (whether or not having
the force of law) shall (i) subject any Lender to any tax of any
kind whatsoever with respect to this Agreement or any Advance made
by it or change the basis of taxation of payments to any Lender
hereunder (except for changes in respect of taxes on the overall
net income of such Lender (as the case may be) or its lending
office imposed by the jurisdiction in which such Lender’s (as
the case may be) principal executive office or lending office is
located),
(ii)
shall result in the imposition, modification or applicability
of any reserve, special deposit or similar requirement against
assets of, deposits with or for the account of or credit
extended by any Lender or (iii) shall result in the imposition
on any Lender or the London interbank market of any other
condition affecting this Agreement, such Lender’s
Commitment or any Advance made by such Lender, and the result
of any of the foregoing shall be to increase the cost to such
Lender of making or maintaining any Outstanding Advances or to
reduce the amount of any sum received or receivable by such
Lender hereunder (whether of principal, interest or otherwise)
by an amount reasonably deemed by such Lender to be material,
then the Borrower shall, upon receipt of the notice and
certificate provided for in subsection (c) below promptly pay
to such Lender such additional amount or amounts as will
compensate such Lender for such additional costs incurred or
reduction suffered.
(b)
If
any Lender shall have determined that the adoption after the date
hereof of any law, rule, regulation or guideline regarding capital
adequacy, or any change in any of the foregoing or in the
interpretation or administration of any of the foregoing by any
Governmental Authority, central bank or comparable agency charged
with the interpretation or administration thereof, or compliance by
any Lender (or any lending office of such Lender) or any
Lender’s holding company with any request or directive
regarding capital adequacy (whether or not having the force of law)
of any such authority, central bank or comparable agency, has or
would have the effect of reducing the rate of return on such
Lender’s capital or on the capital of such Lender’s
holding company, if any, as a consequence of this Agreement, such
Lender’s Commitment or the Advances made by such Lender
pursuant hereto to a level below that which such Lender or such
Lender’s holding company could have achieved but for such
adoption, change or compliance (taking into consideration such
Lender’s policies and the policies of such Lender’s
holding company with respect to capital adequacy) by an amount
reasonably deemed by such Lender to be material, then from time to
time such additional amount or amounts as will compensate such
Lender for any such reduction suffered will be paid to such Lender
by the Borrower. It is acknowledged that this Agreement
is being entered into by the Lenders on the understanding that the
Lenders will be required to maintain capital against their
Commitments, under currently applicable laws, regulations and
regulatory guidelines. In the event the Lenders shall
otherwise determine that such understanding is incorrect, it is
agreed that the Lenders will be entitled to make claims under this
subsection (b) based upon market requirements prevailing on the
date hereof for commitments under comparable credit facilities
against which capital is required to be maintained.
(c)
A
certificate of each Lender setting forth such amount or amounts as
shall be necessary to compensate such Lender or its holding company
as specified in subsection (a) or (b) above, as the case may be,
and containing an explanation in reasonable detail of the manner in
which such amount or amounts shall have been determined, shall be
delivered to the Borrower (with a copy to the Agent) and shall be
conclusive absent manifest error. The Borrower shall pay
each Lender the amount shown as due on any such certificate
delivered by it within 10 days after its receipt of the
same. Each Lender shall give prompt notice to the
Borrower of any event of which it has knowledge, occurring after
the date hereof, that it has determined will require compensation
by the Borrower pursuant to this Section; provided ,
however ,
that failure by such Lender to give such notice shall not
constitute a waiver of such Lender’s right to demand
compensation hereunder.
(d)
Failure
on the part of any Lender to demand compensation for any increased
costs or reduction in amounts received or receivable or reduction
in return on capital with respect to any period shall not
constitute a waiver of such Lender’s right to demand
compensation with respect to such period or any other period;
provided that the Borrower shall not be required to compensate a
Lender pursuant to this Section for any amounts incurred more than
180 days prior to the date that such Lender notifies the Borrower
of such Lender’s intention to claim compensation therefor;
provided further that, if the circumstances giving rise to such
claim have a retroactive effect, then such 180 days period shall be
extended to include the period of such retroactive
effect. The obligations of the Borrower pursuant to this
Section shall survive the termination of this Agreement and the
payment of all amounts payable hereunder. The protection
of this Section shall be available to each Lender regardless of any
possible contention of the invalidity or inapplicability of the
law, rule, regulation, guideline or other change or condition which
shall have occurred or been imposed.
(e)
Each
Lender agrees that it will designate a different lending office if
such designation will avoid the need for, or reduce the amount of,
such compensation or any payment under Section 2.19 hereof and will
not, in the reasonable judgment of such Lender be disadvantageous
to such Lender.
SECTION 2.15.
Change in Legality .
(a)
Notwithstanding
any other provision herein, if any change in any law or regulation
or in the interpretation thereof by any Governmental Authority
charged with the administration or interpretation thereof shall
make it unlawful for any Lender to make or maintain any Advance or
to give effect to its obligations as contemplated hereby with
respect to any Advance, then, by written notice to the Borrower and
to the Agent, such Lender may:
(i)
declare
that Advances will not thereafter be made by such Lender (any
Lender delivering such a declaration hereby agreeing to withdraw
such declaration promptly upon determining that such event of
illegality no longer exists); and
(ii)
require
that all outstanding Advances made by it be subject to a rate equal
to the costs of funds of such Lender as reasonably determined by
such Lender.
(b)
For
purposes of this Section, a notice by any Lender shall be effective
as to each Advance, if lawful, on the last day of the Interest
Period currently applicable to such Advance; in all other cases
such notice shall be effective on the date of receipt.
SECTION 2.16.
Pro Rata Treatment .
Except
as required under Sections 2.14 and 2.17, each Advance, each
repayment of any Advance, each payment of interest on the
Advances and each payment of the Fees shall be allocated
pro
rata among the Lenders in accordance with their
respective Commitments (or, if such Commitments shall have
expired or been terminated, in accordance with the respective
principal amounts of their Outstanding
Advances). Each Lender agrees that in computing
such Lender’s portion of any Advance to be made
hereunder, the Agent may, in its discretion, round each
Lender’s percentage of such Advance to the next higher
or lower whole dollar amount.
SECTION 2.17.
Sharing of Setoffs .
(a)
Except
to the extent that this Agreement, any other Credit Document or a
court order expressly provides for payments to be allocated to a
particular Lender or to the Lenders hereunder, if any Lender (a
“ Benefited
Lender ”) shall receive any payment of all or part of
the Obligations owing to it (other than in connection with an
assignment or participation made pursuant to Section 9.05), or
receive any collateral in respect thereof (whether voluntarily or
involuntarily, by set off, pursuant to events or proceedings of the
nature referred to in Section 7(f)), or otherwise), in a greater
proportion than any such payment to or collateral received by any
other Lender, if any, in respect of the Obligations owing to such
other Lender, such Benefited Lender shall purchase for cash from
the other Lenders a participating interest in such portion of the
Obligations owing to each such other Lender, or shall provide such
other Lenders with the benefits of any such collateral, as shall be
necessary to cause such Benefited Lender to share the excess
payment or benefits of such collateral ratably with each of the
Lenders; provided that
if all or any portion of such excess payment or benefits is
thereafter recovered from such Benefited Lender, such purchase
shall be rescinded, and the purchase price and benefits returned,
to the extent of such recovery, but without interest.
SECTION 2.18.
Payments.
(a)
The
Borrower shall make each payment (including principal of or
interest on any Advance or any Fees or other amounts) hereunder
from an account in the United States not later than 2:00 p.m., New
York City time, on the date when due in dollars to the Agent in
immediately available funds. Each Payment shall be made
without off-set, deduction or counterclaim; provided that
the foregoing shall not constitute a relinquishment or waiver of
the Borrower’s rights to any independent claim that the
Borrower may have against the Agent or any Lender.
(b)
Any
payments under this Agreement that are made later than 2:00 p.m.,
New York City time (other than payments made by the Agent in
accordance with Section 2.04(d)), shall be deemed to have been made
on the next succeeding Business Day. Whenever any
payment (including principal of or interest on Advance or any Fees
or other amounts) hereunder shall become due, or otherwise would
occur, on a day that is not a Business Day, such payment may be
made on the next succeeding Business Day, and such extension of
time shall in such case be included in the computation of interest
or Fees, if applicable.
(c)
The
Borrower agrees to indemnify each Lender for, and to hold each
Lender harmless from, any loss or expense that such Lender may
sustain or incur as a consequence of (a) default by the Borrower in
making a borrowing of Advances after the Borrower has given a
notice requesting the same in accordance with the provisions of
this Agreement, (b) default by the Borrower in making any
prepayment of Advances after the Borrower has given a notice
thereof in accordance with the provisions of this Agreement or (c)
the making of a prepayment of Advances on a day that is not the
last day of an Interest Period with respect
thereto. Such indemnification may include an amount
equal to the excess, if any, of (i) the amount of interest that
would have accrued on the amount so prepaid, or not so borrowed,
for the period from the date of such prepayment or of such failure
to borrow to the last day of such Interest Period (or, in the case
of a failure to borrow, the Interest Period that would have
commenced on the date of such failure) in each case at the
applicable rate of interest for such Advances provided for
herein
over
(ii) the amount of interest (as reasonably determined by such
Lender) that would have accrued to such Lender on such amount
by placing such amount on deposit for a comparable period with
leading banks in the London interbank market. A
certificate as to any amounts payable pursuant to this Section
submitted to the Borrower (with a copy to the Agent) by any
Lender shall be conclusive in the absence of manifest
error. Notwithstanding anything to the contrary in
this Section, the Borrower shall not be required to compensate
a Lender pursuant to this Section for any amounts incurred
more than 180 days prior to the date that such Lender notifies
the Borrower of such Lender’s intention to claim
compensation therefor; provided
that, if the circumstances giving rise to such claim have a
retroactive effect, then such 180 days period shall be
extended to include the period of such retroactive
effect. This covenant shall survive the termination
of this Agreement and the payment of the Advances and all
other amounts payable hereunder.
SECTION 2.19.
Taxes .
(a)
All
payments made by the Borrower under this Agreement and the other
Credit Documents shall be made free and clear of, and without
deduction or withholding for or on account of, any present or
future income, stamp or other taxes, levies, imposts, duties,
charges, fees, deductions or withholdings, now or hereafter
imposed, levied, collected, withheld or assessed by any
Governmental Authority, excluding net income taxes, gross receipt
taxes (imposed in lieu of net income taxes) and franchise taxes
(imposed in lieu of net income taxes) imposed on the Agent or any
Lender as a result of a present or former connection between the
Agent or such Lender and the jurisdiction of the Governmental
Authority imposing such tax or any political subdivision or taxing
authority thereof or therein (other than any such connection
arising solely from the Agent or such Lender having executed,
delivered or performed its obligations or received a payment under,
or enforced, this Agreement or any other Credit
Document). If any such non-excluded taxes, levies,
imposts, duties, charges, fees, deductions or withholdings (“
Non-Excluded
Taxes ”) or Other Taxes are required to be withheld
from any amounts payable to the Agent or any Lender hereunder, the
amounts so payable to the Agent or such Lender shall be increased
to the extent necessary to yield to the Agent or such Lender (after
payment of all Non-Excluded Taxes and Other Taxes) interest or any
such other amounts payable hereunder at the rates or in the amounts
specified in this Agreement, provided, however, that the Borrower
shall not be required to increase any such amounts payable to any
Lender with respect to any Non-Excluded Taxes (i) that are
attributable to such Lender’s failure to comply with the
requirements of paragraph (d) or (f) of this Section or (ii) that
are United States withholding taxes imposed on amounts payable to
such Lender at the time such Lender becomes a party to this
Agreement, except to the extent that such Lender’s assignor
(if any) was entitled, at the time of assignment, to receive
additional amounts from the Borrower with respect to such
Non-Excluded Taxes pursuant to this paragraph.
(b)
In
addition, the Borrower shall pay any Other Taxes to the relevant
Governmental Authority in accordance with applicable
law.
(c)
Whenever
any Non-Excluded Taxes or Other Taxes are payable by the Borrower,
as promptly as possible thereafter the Borrower shall send to the
Agent for its own account or for the account of the relevant
Lender, as the case may be, a certified copy of an original
official receipt received, if any, by the Borrower or other
documentary evidence showing payment
thereof. If
the Borrower fails to pay any Non-Excluded Taxes or Other
Taxes when due to the appropriate taxing authority or fails to
remit to the Agent the required receipts or other required
documentary evidence, the Borrower shall indemnify the Agent
or the Lenders for any such taxes and for any incremental
taxes, interest or penalties that may become payable by the
Agent or any Lender as a result of any such
failure.
(d)
Each
Lender (or Transferee) that is not a “U.S. Person” as
defined in Section 7701(a)(30) of the Code (a “ Non U.S.
Lender ”) shall deliver to the Borrower and the Agent
(or, in the case of a Participant, to the Lender from which the
related participation shall have been purchased) two copies of
either U.S. Internal Revenue Service Form W-8BEN, Form W-8ECI or
W-8IMY (and all necessary attachments), or, in the case of a Non
U.S. Lender claiming exemption from U.S. federal withholding tax
under Section 871(h) or 881(c) of the Code with respect to payments
of “portfolio interest”, a statement substantially in
the form of Exhibit G to the Existing Facility Credit Agreement and
a Form W-8BEN, or any subsequent versions thereof or successors
thereto, properly completed and duly executed by such Non U.S.
Lender claiming complete exemption from, or a reduced rate of, U.S.
federal withholding tax on all payments by the Borrower under this
Agreement and the other Credit Documents. Such forms
shall be delivered by each Non U.S. Lender on or before the date it
becomes a party to this Agreement (or, in the case of any
Participant, on or before the date such Participant purchases the
related participation). In addition, each Non U.S.
Lender shall deliver such forms promptly upon the obsolescence or
invalidity of any form previously delivered by such Non U.S.
Lender. Each Non-U.S. Lender shall promptly notify the
Borrower at any time it determines that it is no longer in a
position to provide any previously delivered certificate to the
Borrower (or any other form of certification adopted by the U.S.
taxing authorities for such purpose). Notwithstanding
any other provision of this paragraph, a Non U.S. Lender shall not
be required to deliver any form pursuant to this paragraph that
such Non U.S. Lender is not legally able to deliver.
(e)
A
Lender that is entitled to an exemption from or reduction of
non-U.S. withholding tax under the law of the jurisdiction in which
the Borrower is located, or any treaty to which such jurisdiction
is a party, with respect to payments under this Agreement shall
deliver to the Borrower (with a copy to the Agent), at the time or
times prescribed by applicable law or reasonably requested by the
Borrower, such properly completed and executed documentation
prescribed by applicable law as will permit such payments to be
made without withholding or at a reduced rate, provided that
such Lender is legally entitled to complete, execute and deliver
such documentation and in such Lender’s judgment such
completion, execution or submission would not materially prejudice
the legal position of such Lender.
(f)
Any
Lender that is a United States person, as defined in Section
7701(a)(30) of the Internal Revenue Code, and is not an exempt
recipient within the meaning of Treasury Regulations Section
1.6049-4(c), shall deliver to the Borrower (with a copy to the
Agent) two accurate and complete original signed copies of Internal
Revenue Service Form W-9, or any successor form that such person is
entitled to provide at such time in order to comply with United
States back-up withholding requirements.
(g)
If
the Agent or any Lender determines, in its sole discretion, that it
has received a refund of any Non-Excluded Taxes or Other Taxes as
to which it has been indemnified by the Borrower or with respect to
which the Borrower has paid additional amounts pursuant to
this
Section
2.19, it shall pay over such refund to the Borrower (but only
to the extent of indemnity payments made, or additional
amounts paid, by the Borrower under this Section 2.19 with
respect to the Non-Excluded Taxes or Other Taxes giving rise
to such refund), net of all out-of-pocket expenses of the
Agent or such Lender and without interest (other than any
interest paid by the relevant Governmental Authority with
respect to such refund); provided
that the Borrower, upon the request of the Agent or such
Lender, agrees to repay the amount paid over to the Borrower
(plus any penalties, interest or other charges imposed by the
relevant Governmental Authority) to the Agent or such Lender
in the event the Agent or such Lender is required to repay
such refund to such Governmental Authority. This
paragraph shall not be construed to require the Agent or any
Lender to make available its tax returns (or any other
information relating to its taxes which it deems confidential)
to the Borrower or any other Person.
(h)
The
agreements in this Section 2.19 shall survive the termination of
this Agreement and the payment of the Advances and all other
amounts payable hereunder.
ARTICLE III
REPRESENTATIONS AND WARRANTIES
The
Borrower represents and warrants to the Agent and to each
Lender as follows on the Closing Date and on each date
required pursuant to Article IV:
SECTION 3.01.
Existence; Compliance with Law.
Each
Loan Party (a) is duly organized, validly existing and (to the
extent such concept is applicable) in good standing under the
laws of the jurisdiction of its organization, (b) has the
power and authority, and the legal right, to own and operate
its property, to lease the property it operates as lessee and
to conduct the business in which it is currently engaged, (c)
is duly qualified as a foreign corporation or other
organization and (to the extent such concept is applicable) in
good standing under the laws of each jurisdiction where its
ownership, lease or operation of property or the conduct of
its business requires such qualification and (d) is in
compliance with all Requirements of Law, except, in the case
of each of the foregoing clauses (a) through (d), to the
extent that the failure to comply therewith would not, in the
aggregate, reasonably be expected to have a Material Adverse
Effect.
SECTION 3.02.
Power; Authorizations; Enforceable Obligations.
Each
Loan Party has the power and authority, and the legal right,
to make, deliver and perform the Credit Documents to which it
is a party and, in the case of the Borrower, to obtain
extensions of credit hereunder. Each Loan Party has
taken all necessary organizational action to authorize the
execution, delivery and performance of the Credit Documents to
which it is a party and, in the case of the Borrower, to
authorize the extensions of credit on the terms and conditions
of this Agreement. No consent or authorization of,
filing with, notice to or other act by or in respect of, any
Governmental Authority or any other Person is required in
connection with the extensions of credit hereunder or with the
execution, delivery, performance, validity or enforceability
of this Agreement or any of the Credit Documents, except (i)
that have been obtained or made and are in full force and
effect and (ii) the filings made in respect of
the
Security
Documents. Each Credit Document has been duly
executed and delivered on behalf of each Loan Party party
thereto. This Agreement constitutes, and each other
Credit Document upon execution will constitute, a legal, valid
and binding obligation of each Loan Party party thereto,
enforceable against each such Loan Party in accordance with
its terms, except as enforceability may be limited by
applicable bankruptcy, insolvency, reorganization, moratorium
or similar laws affecting the enforcement of creditors’
rights generally and by general equitable principles (whether
enforcement is sought by proceedings in equity or at
law).
SECTION 3.03.
No Legal Bar.
The
execution, delivery and performance of this Agreement and the
other Credit Documents, the borrowings hereunder and the use
of the proceeds thereof will not violate any Requirement of
Law or any Contractual Obligation of any Loan Party and will
not result in, or require, the creation or imposition of any
Lien on any of their respective properties or revenues
pursuant to any Requirement of Law or any such Contractual
Obligation (other than the Liens created by the Security
Documents). No Requirement of Law or Contractual
Obligation applicable to the Borrower or any of its
Subsidiaries could reasonably be expected to have a Material
Adverse Effect.
SECTION 3.04.
Accuracy of Information.
No
statement or information contained in this Agreement, any
other Credit Document, the Confidential Information Memorandum
(other than projections and pro forma financial information)
or any other document, certificate or statement furnished by
or on behalf of the Borrower to the Agent or the Lenders, or
any of them, for use in connection with the transactions
contemplated by this Agreement or the other Credit Documents,
contained as of the date such statement, information, document
or certificate was so furnished, taken as a whole and in light
of the circumstances in which made, any untrue statement of a
material fact or omitted to state a material fact necessary to
make the statements contained herein or therein not
misleading. The projections and pro forma financial
information contained in the materials referenced above were
prepared in good faith based on assumptions believed by
management of the Borrower to be reasonable at the time made,
it being recognized by the Lenders that such financial
information as it relates to future events is not to be viewed
as fact and that actual results during the period or periods
covered by such financial information may differ from the
projected results set forth therein by a material
amount. There is no fact known to any Loan Party
that could reasonably be expected to have a Material Adverse
Effect that has not been expressly disclosed herein, in the
other Credit Documents, in the Confidential Information
Memorandum or in any other documents, certificates and
statements furnished to the Agent and the Lenders for use in
connection with the transactions contemplated hereby and by
the other Credit Documents.
SECTION 3.05.
Financial Condition.
(a)
The
audited consolidated balance sheets of the Borrower and its
consolidated Subsidiaries as at December 31 of the most recently
ended three fiscal years of the Borrower ending prior to the
Closing Date for which audited financial statements were delivered,
and the related consolidated statements of income and of cash flows
for the fiscal years ended on such dates, reported on by and
accompanied by an unqualified report by a nationally
recognized
accounting
firm, present fairly in all material respects the consolidated
financial condition of the Borrower and its Subsidiaries as at
such date, and the consolidated results of its operations and
its consolidated cash flows for the respective fiscal years
then ended. The unaudited consolidated balance
sheet of the Borrower and its consolidated Subsidiaries as at
the end of the most recently ended fiscal quarter of the
Borrower ending prior to the Closing Date for which unaudited
financial statements were delivered, and the related unaudited
consolidated statements of income and cash flows for the
period ended on such fiscal quarter end, present fairly in all
material respects the consolidated financial condition of the
Borrower and its consolidated Subsidiaries as at such date,
and the consolidated results of its operations and its
consolidated cash flows for the period ended on such fiscal
quarter end (subject to normal year end audit
adjustments). All such financial statements,
including the related schedules and notes thereto, have been
prepared in accordance with GAAP applied consistently
throughout the periods involved (except as approved by the
aforementioned firm of accountants and disclosed
therein). As of the date of such financial
statements, no Global Entity has any material Guarantee
Obligations, contingent liabilities and liabilities for taxes,
or any long term leases or unusual forward or long term
commitments, including any interest rate or foreign currency
swap or exchange transaction or other obligation in respect of
derivatives, that are not reflected in the most recent
financial statements referred to in this
paragraph.
(b)
Since
December 31, 2006, there has been no development or event that has
had or would reasonably be expected to have a Material Adverse
Effect.
SECTION 3.06.
Subsidiaries.
(a)
Schedule 3.06 annexed to the Existing Facility Credit
Agreement (as may be supplemented in writing from time to time
by the Borrower) sets forth the name and jurisdiction of
organization of each Subsidiary of the Borrower and, as to
each such Subsidiary, the percentage of each class of Capital
Stock owned by any Loan Party and (b) there are no outstanding
subscriptions, options, warrants, calls, rights or other
agreements or commitments (other than stock options or
restricted stock granted to employees or directors and
directors’ qualifying shares) of any nature relating to
any Capital Stock of the Borrower or any of its Subsidiaries
directly owned by the Loan Parties that are included in the
Collateral, except as created by the Credit Documents or
permitted under Section 6.02(c) or Sections 6.02(w) and
(z).
SECTION 3.07.
Title to Assets; Liens.
The
Loan Parties have title in fee simple to, or a valid leasehold
or easement interest in, all their material real property,
taken as a whole, and good and marketable title to, or a valid
leasehold or easement interest in, all their other material
property, taken as a whole, and none of such property is
subject to any Lien except Permitted Liens.
SECTION 3.08.
No Default.
No
Global Entity is in default under or with respect to any of
its Contractual Obligations in any respect that would
reasonably be expected to have a Material Adverse
Effect.
SECTION 3.09.
Use of Proceeds.
The
proceeds of the Advances
shall be used to collateralize obligations of the Loan Parties
to the counterparties under Eligible Commodity Hedge
Agreements.
SECTION 3.10.
Litigation.
Except
as disclosed in writing to the Agent and the Lenders prior to
the date hereof, no litigation, investigation or proceeding of
or before any arbitrator or Governmental Authority is pending
or, to the knowledge of the Borrower, threatened by or against
any Global Entity or against any of their respective
properties or revenues (a) with respect to any of the Credit
Documents or any of the transactions contemplated hereby or
thereby, or (b) that could reasonably be expected to have a
Material Adverse Effect.
SECTION 3.11.
Federal Regulations.
No
part of the proceeds of any Advances will be used (a) for
“buying” or “carrying” any
“margin stock” within the respective meanings of
each of the quoted terms under Regulation U as now and from
time to time hereafter in effect for any purpose that violates
the provisions of the regulations of the Board or (b) for any
purpose that violates the provisions of the regulations of the
Board. If requested by any Lender or the Agent in
order to comply with any Requirement of Law, the Borrower will
furnish to the Agent and each Lender a statement to the
foregoing effect in conformity with the requirements of FR
Form G-3 or FR Form U 1, as applicable, referred to in
Regulation U.
SECTION 3.12.
Compliance with Law.
No
Global Entity is in violation of any applicable law, rule or
regulation, or in default with respect to any judgment, writ,
injunction or decree of any Governmental Authority, the
violation of which, or a default with respect to which, would
reasonably be expected to have a Material Adverse
Effect.
SECTION 3.13.
Taxes.
Each
Global Entity has filed or caused to be filed all Federal and
state income tax and other material tax returns that are
required to be filed and has paid all taxes shown to be due
and payable on said returns or on any assessments made against
it or any of its property and all other taxes, fees or other
charges imposed on it or any of its property by any
Governmental Authority (other than any the amount or validity
of which are currently being contested in good faith by
appropriate proceedings and with respect to which reserves in
conformity with GAAP have been provided on the books of the
relevant Global Entity); no tax Lien has been filed, and, to
the knowledge of the Borrower, no claim is being asserted,
with respect to any such tax, fee or other charge other than
Liens or claims permitted under this Agreement.
SECTION 3.14.
ERISA.
Except
as, individually or in the aggregate, does not or could not
reasonably be expected to result in a Material Adverse Effect:
neither a Reportable Event nor an “accumulated
funding
deficiency”
(within the meaning of Section 412 of the Code or Section 302
of ERISA) has occurred during the five year period prior to
the date on which this representation is made or deemed made
with respect to any Plan, and each Plan has complied in all
respects with the applicable provisions of ERISA and the Code;
no termination of a Single Employer Plan has occurred, and no
Lien in favor of the PBGC or a Plan has arisen, during such
five-year period; the present value of all accrued benefits
under each Single Employer Plan (based on those assumptions
used to fund such Plans) did not, as of the last annual
valuation date prior to the date on which this representation
is made or deemed made, exceed the value of the assets of such
Plan allocable to such accrued benefits; neither the Borrower
nor any Commonly Controlled Entity has had a complete or
partial withdrawal from any Multiemployer Plan; neither the
Borrower nor any Commonly Controlled Entity would become
subject to any liability under ERISA if the Borrower or any
such Commonly Controlled Entity were to withdraw completely
from all Multiemployer Plans as of the valuation date most
closely preceding the date on which this representation is
made or deemed made; and no such Multiemployer Plan is in
Reorganization or Insolvent.
SECTION 3.15.
Environmental Matters; Hazardous Material.
There
has been no matter with respect to Environmental Laws or
Materials of Environmental Concern which, individually or in
the aggregate, would reasonably be expected to have a Material
Adverse Effect.
SECTION 3.16.
Investment Company Act; Other Regulations.
No
Loan Party is an “investment company”, or a
company “controlled” by an “investment
company”, within the meaning of the Investment Company
Act of 1940, as amended. No Loan Party is subject
to regulation under any Requirement of Law (other than
Regulation X of the Board) that limits its ability to incur
Indebtedness under this Agreement and the other Credit
Documents.
SECTION 3.17.
Labor Matters.
Except
as, in the aggregate, would not reasonably be expected to have
a Material Adverse Effect: (a) there are no strikes or other
labor disputes against any Global Entity pending or, to the
knowledge of the Borrower, threatened; (b) hours worked by and
payment made to employees of each Global Entity have not been
in violation of the Fair Labor Standards Act or any other
applicable Requirement of Law dealing with such matters; and
(c) all payments due from any Global Entity on account of
employee health and welfare insurance have been paid or
accrued as a liability on the books of the relevant Global
Entity.
SECTION 3.18.
Security Documents.
The
Obligations rank at least pari passu in right of payment and
upon liquidation of the Collateral with the Loan
Parties’ obligations to the Existing Facility Lenders
with respect to the Existing Facility Credit Agreement,
pursuant to the terms of the Security Documents and the
Collateral Agency and Intercreditor Agreement.
SECTION 3.19.
Solvency.
(a)
The Borrower is and (b) the Loan Parties, taken as a whole,
are, and after giving effect to the incurrence of all
Indebtedness and obligations being incurred in connection
herewith and with the Plan of Reorganization will be,
Solvent.
SECTION 3.20.
Senior Indebtedness.
The
Obligations constitute “Senior Indebtedness” (or
similar such term) of the Borrower under each Subordinated
Indebtedness Agreement. The obligations of each
Subsidiary Guarantor under the Guarantee and Collateral
Agreement constitute “Guarantor Senior
Indebtedness” (or similar such term) of such Subsidiary
Guarantor under each Subordinated Indebtedness
Agreement.
SECTION 3.21.
Certain Documents.
The
Borrower has delivered to the Agent a complete and correct
copy of the Existing Facility Credit Agreement, the Guarantee
and Collateral Agreement, the Collateral Agency and
Intercreditor Agreement, each Subordinated Indebtedness
Agreement and each Junior Lien Agreement, as currently in
effect, including any amendments, supplements or modifications
with respect to any of the foregoing.
ARTICLE IV
CONDITIONS
The
obligations of the Lenders to make Advances hereunder are
subject to the satisfaction of the following
conditions:
SECTION 4.01.
Initial Advances .
The
Commitment of each Lender to fund its portion of the Initial
Advance on the Closing Date is subject to the following
conditions:
(a)
The
Agent shall have received the following Credit Documents: (i)
counterparts of this Agreement executed by the parties hereto, (ii)
the Guarantee and Collateral Agreement and the Collateral Agency
and Intercreditor Agreement and (iii) the Fee Letter.
(b)
The
Agent shall have received favorable written legal opinions of (i)
Kirkland & Ellis LLP, counsel to the Borrower, and (ii)
Morrison & Foerster, special New York counsel to the Agent, in
each case dated the date hereof, addressed to the Agent and the
Lenders with respect to customary matters and in form and substance
reasonably satisfactory to the Agent.
(c)
The
Agent shall have received (i) a copy of the certificate of
incorporation, including all amendments thereto, of the Borrower,
certified as of a recent date by the Secretary of State of the
state of Delaware, and a certificate as to the good standing of the
Borrower as of a recent date from such Secretary of State; (ii) a
certificate of the Secretary or an Assistant Secretary or analogous
officer of the Borrower, dated the date of this Agreement and
certifying
(A)
that attached thereto is a true and complete copy of the
certificate of incorporation of the Borrower as in effect on
such date and at all times since a date prior to the date of
the resolutions described in clause (B) below, (B) that
attached thereto are true and complete copies of resolutions
duly adopted by the Board of Directors (or any duly authorized
committee thereof), authorizing the execution and delivery by
the Borrower of this Agreement, the Advances to be made
hereunder and the performance by the Borrower of all of its
obligations hereunder, and that such resolutions have not been
modified, rescinded or amended and are in full force and
effect, (C) that the certificate of incorporation referred to
in clause (i) above has not been amended since the date of the
last amendment thereto shown on the certificate of good
standing furnished pursuant to such clause (i) and (D) as to
the incumbency and specimen signature of each officer
executing this Agreement and any other document delivered in
connection herewith on behalf of the Borrower; (iii) a
certificate of another officer of the Borrower as to the
incumbency and specimen signature of the Secretary or
Assistant Secretary or analogous officer executing the
certificate pursuant to (ii) above; and (iv) a certificate of
a Responsible Officer of the Borrower, dated the date of this
Agreement, stating that (A) no action, consent or approval of,
registration or filing with or other action by any
Governmental Authority is or will be required in connection
with the execution, delivery and performance by the Borrower
of this Agreement, except those as have been duly obtained and
as are (1) in full force and effect, (2) sufficient for their
purpose and (3) not subject to any pending or, to the
knowledge of such Person, threatened appeal or other
proceeding seeking reconsideration or review thereof, and (B)
the representations and warranties set forth in Article III
hereof are true and correct in all material respects on and as
of the date hereof, and (C) no Event of Default or Default has
occurred and is continuing on the date hereof.
(d)
[Reserved.]
(e)
The
Lenders, the Agent and the Lead Arranger shall have received
payment of all fees and reimbursements of all expenses for which
invoices have been presented as and when due on or prior to the
date of the Initial Advance pursuant to the terms of this Agreement
or the Fee Letter.
(f)
The
Agent shall have received all documentation and information
required by regulatory authorities under applicable “know
your customer” and anti-money laundering rules and
regulations, including without limitation the USA Patriot Act
(Title III of Pub. L. 107-56 (signed into law October 26,
2001)).
(g)
The
Agent shall have become party to the Collateral Agency and
Intercreditor Agreement.
(h)
[Reserved.]
(i)
The
Agent shall have determined, in consultation with its counsel, that
the obligations of the Borrower under this Agreement are secured
ratably with the obligations of Borrower under the Existing
Facility Credit Agreement by the valid and perfected lien on and
security interest in the Collateral granted pursuant to the terms
of the Security Documents and the Collateral Agency and
Intercreditor Agreement.
SECTION 4.02.
Conditions for All Advances .
The
Commitment of each Lender to make each Advance hereunder shall
be subject to the satisfaction of the following conditions
precedent on the date of such Advance:
(a)
The
Agent shall have received a Borrowing Notice.
(b)
All
representations and warranties contained in or pursuant to this
Agreement and the other Credit Documents, or otherwise made in
writing in connection herewith or therewith, shall be true and
correct in all material respects on and as of the date of each
Advance hereunder with the same effect as if made on and as of such
date (unless stated to relate to specific earlier date, in which
case, such representations and warranties shall be true and correct
in all material respects as of such earlier date) (it being
understood that any representation or warranty that is qualified as
to materiality or Material Adverse Effect shall be correct in all
respects).
(c)
At
the time of and immediately after such Advance, no Default or Event
of Default shall have occurred and be continuing at the time of
such Advance or would result from the making of such
Advance.
The
request by the Borrower for, and the acceptance by the
Borrower of, each Advance hereunder shall be deemed to be a
representation and warranty by the Borrower that the
conditions specified in this Section 4.02 have been satisfied
or waived at that time.
ARTICLE V
AFFIRMATIVE COVENANTS
The
Borrower agrees that, so long as any Lender has any Commitment
hereunder or any Advance or other amount is owing to any
Lender or the Agent hereunder or under any other Credit
Document (other than contingent indemnification obligations
for which no claim has been asserted) the Borrower shall, and
shall cause each of the Restricted Subsidiaries to, directly
or indirectly:
SECTION 5.01.
Financial Statements, Etc.
Deliver
to the Agent (for distribution to the Lenders):
(a)
within
ninety (90) days (or, if agreed to under the Existing Facility
Credit Agreement, 105 days) after the end of each fiscal year of
the Borrower ending after the Closing Date, a copy of the audited
consolidated balance sheet of the Borrower and its consolidated
Subsidiaries as at the end of such year and the related audited
consolidated statements of income and of cash flows for such year,
setting forth in each case in comparative form the figures for the
previous year, reported on without a “going concern” or
like qualification or exception, or qualification arising out of
the scope of the audit, by PricewaterhouseCoopers or other
independent certified public accountants of nationally recognized
standing; and
(b)
within
forty-five (45) days (or if agreed to under the Existing Facility
Credit Agreement, sixty (60) days) after the end of each of the
first three quarterly fiscal periods of each
fiscal
year, a copy of the unaudited consolidated balance sheet of
the Borrower and its consolidated Subsidiaries as at the end
of such quarter and the related unaudited consolidated
statements of income in such quarter and of cash flows for the
portion of the fiscal year through the end of such quarter,
setting forth in each case in comparative form the
corresponding consolidated figures for the corresponding
periods in the preceding fiscal year, accompanied by a
certificate of a Responsible Officer, which certificate shall
state that such consolidated financial statements fairly
present, in all material respects, the consolidated financial
condition and results of operations of the Borrower and its
consolidated Subsidiaries, in accordance with GAAP,
consistently applied, as at the end of, and for, such period
(subject to normal year-end audit adjustments and the absence
of footnotes).
All
such financial statements delivered pursuant to subsections
(a) and (b) above shall be complete and correct in all
material respects and shall be prepared in reasonable detail
and in accordance with GAAP applied consistently throughout
the periods reflected therein and with prior
periods. The Borrower may provide the financial
statements and other materials required to be furnished
pursuant to this Section by posting such financial statements
and materials on IntraLinks/IntraAgency, SyndTrak or other
relevant website or other information platform (the “
Platform
”) to which the Agent has access. If
delivered to the Agent, the Agent will provide the financial
statements and other materials required to be furnished
pursuant to this Section to the Lenders by posting such
financial statements and materials on the Platform within five
Business Days after receipt thereof. Information required to
be delivered pursuant to subsections (a) and (b) above shall
be deemed satisfied by delivery within the time periods set
forth in such subsections of the Borrower’s annual
report on Form 10-K and quarterly report on Form 10-Q,
respectively, in each case as filed with the SEC for the
applicable period.
SECTION 5.02.
Certificates; Other Information.
Deliver
to the Agent and, in the case of clause (h) below, to the
applicable Lender:
(a)
concurrently
with the delivery of the financial statements referred to in
Section 5.01(a), a certificate of the independent certified public
accountants reporting on such financial statements stating that in
making the examination necessary thereof
