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EXHIBIT 99-29
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STANDBY NOTE
PURCHASE CREDIT FACILITY
Dated as of October 26, 1999
THE DETROIT EDISON COMPANY, a Michigan corporation (the "COMPANY"), the
banks (the "BANKS") listed on the signature pages hereof, BARCLAYS BANK PLC, as
administrative agent (the "ADMINISTRATIVE AGENT") for the Banks hereunder, and
▇▇▇▇▇▇ BROTHERS INC., BANC ONE CAPITAL MARKETS, INC. and BARCLAYS CAPITAL INC.,
each as a Remarketing Agent (as hereinafter defined), agree as follows:
PRELIMINARY STATEMENT
The Company expects to remarket $160,000,000 aggregate principal amount
of its Multi-Mode Remarketed Secured Notes (the "NOTES") issued pursuant to a
Collateral Trust Indenture, dated as of June 30, 1993, as amended and
supplemented by various supplemental indentures, including that certain Second
Supplemental Indenture, dated as of September 15, 1993, as amended by the First
Amendment to the Second Supplemental Indenture, dated as of August 15, 1996
(together, and as further amended and supplemented, the "NOTE INDENTURE"),
between the Company and Bankers Trust Company, as trustee. Pursuant to the Note
Indenture, the Notes are and continue to be secured by general and refunding
mortgage bonds of the Company (the "PLEDGED BOND"), which were issued pursuant
to the Mortgage and Deed of Trust, dated as of October 1, 1924, between the
Company and Bankers Trust Company, as amended and supplemented by various
supplemental indentures, including that certain Supplemental Indenture creating
the Pledged Bond, dated as of September 15, 1993 (as so amended and
supplemented, and as further amended and supplemented from time to time, the
"MORTGAGE").
Pursuant to the terms and conditions of the Note Indenture, the Notes
may from time to time be tendered for purchase by the beneficial owners thereof
(each a "BENEFICIAL OWNER"), and, if so tendered, will be remarketed in
accordance with the terms and conditions of the Remarketing Agreement (as
hereinafter defined). In order to assure that adequate liquidity is available in
connection with the purchase upon tender and remarketing of the Notes, the
Company has requested that the Banks establish the credit facility provided for
hereunder for the making of Advances (as hereinafter defined) to the Remarketing
Agents under the circumstances hereinafter described. All Advances will be
utilized for the purchase of Notes which the applicable Remarketing Agent has
been unable to successfully remarket, coincident with their tender by the
holders thereof, in accordance with the terms of the Remarketing Agreement. Any
Notes the purchase of which is funded with the proceeds of Advances will be
purchased for the account of the Administrative Agent for the ratable benefit of
the Banks, and will be registered with DTC (as hereinafter defined) in the name
of the Administrative Agent or its nominee on behalf of the Banks. Such Notes
shall constitute Purchased Notes (as hereinafter defined) for all purposes of
the Note Indenture, until such Notes are successfully remarketed or repurchased
by the Company and the proceeds thereof are paid to the Administrative Agent for
distribution to the Banks hereunder (all as provided herein and in the Note
Indenture). The Company will be required to repurchase any Notes registered in
the name of the Administrative Agent upon any termination of
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the credit facility established hereunder.
The Banks are willing to make the Advances, and the Administrative
Agent has agreed to act as agent for the Banks, on the terms and conditions set
forth herein. Accordingly, the parties hereto agree as follows:
ARTICLE I
DEFINITIONS AND ACCOUNTING TERMS
SECTION 1.01. CERTAIN DEFINED TERMS. As used in this Agreement, the
following terms shall have the following meanings (such meanings to be equally
applicable to both the singular and plural forms of the terms defined):
"ADVANCE" means an advance made by a Bank to any Remarketing Agent
pursuant to Article III, and refers to a Base Rate Advance or a Eurodollar Rate
Advance, each of which shall be a "TYPE" of Advance.
"AGREEMENT" means this Standby Note Purchase Credit Facility, as
amended, modified, supplemented and in effect from time to time.
"APPLICABLE LENDING OFFICE" means, with respect to each Bank, such
Bank's Domestic Lending Office in the case of a Base Rate Advance and such
Bank's Eurodollar Lending Office in the case of a Eurodollar Rate Advance.
"APPLICABLE RATE" means 0.00% with respect to any Base Rate Advance and
means with respect to any Eurodollar Rate Advance or Facility Fee, at all times
during which any "Applicable Rating Level" set forth below is in effect for the
Company's Senior Secured Indebtedness, the rate per annum set forth below under
the appropriate caption next to such Applicable Rating Level:
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Applicable Applicable Rate for Applicable Rate
Rating S&P Rating/Moody's Eurodollar Rate for
Level Rating Advances Facility Fee
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I A+ and A1, or higher 0.375% 0.125%
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II BBB+ and Baa1, or higher 0.475% 0.150%
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III BBB- and Baa3, or higher 0.500% 0.250%
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IV BB+ or Ba1, or lower, or 0.825% 0.425%
not rated by either S&P's
or Moody's or both
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provided, that the Applicable Rate for Eurodollar Rate Advances and Base Rate
Advances shall be increased by (x) 0.125% per annum at all times that the
aggregate principal amount of Advances outstanding is equal to or greater than
33.33% of the aggregate Commitments but less than 66.66% of the aggregate
Commitments and (y) 0.250% per annum at all times that the aggregate principal
amount of Advances outstanding is equal to or greater than 66.66% of the
aggregate Commitments, provided, further, that the Applicable Rate for
Eurodollar Rate Advances and Base Rate Advances shall be increased by 2.00% per
annum upon the occurrence and during the continuance of any Event of Default.
For purposes of the foregoing, the Applicable Rating Level shall be
determined in accordance with the then applicable S&P Rating and the then
applicable ▇▇▇▇▇'▇ Rating. In the event that the S&P Rating and the ▇▇▇▇▇'▇
Rating do not correspond to the same Applicable Rating Level, then the lower of
the two ratings shall determine the Applicable Rating Level. The Applicable
Rating Level shall be redetermined on the date of announcement of a change in
the S&P Rating or the ▇▇▇▇▇'▇ Rating. A change in the Applicable Rate resulting
from a change in the Applicable Rating Level shall become effective on such
date. If the rating system of S&P or Moody's shall change, or if either such
Person shall cease to be in the business of rating corporate debt obligations,
the Company and the Banks shall negotiate in good faith to amend this definition
to reflect such changed rating system or the unavailability of ratings from such
Person and, pending the effectiveness of any such amendment, the Applicable Rate
shall be determined by reference to the rating most recently in effect prior to
such change or cessation.
"BASE RATE" means, for any period, a fluctuating interest rate PER
ANNUM as shall be in effect from time to time which rate per annum shall at all
times be equal to the highest of:
(a) the rate of interest announced by Barclays Bank PLC at its
principal office in New York City from time to time as its prime commercial
lending rate;
(b) 1/2 of 1% per annum above the latest three-week moving average of
secondary market morning offering rates in the United States for three-month
certificates of deposit of major U.S. money market banks, adjusted to the
nearest 1/16 of 1%; and
(c) 1/2 of one percent per annum above the Federal Funds Effective Rate
in effect from time to time.
Each change in the Base Rate shall take effect simultaneously with the
corresponding change or changes in the rates described in clause (a), (b) or
(c), above.
"BASE RATE ADVANCE" means any Advance which bears interest as provided
in Section 3.04(a).
"BENEFICIAL OWNER" has the meaning specified in the Preliminary
Statement.
"BORROWING" means a borrowing under this Agreement, initially
consisting of Base Rate Advances, but which subsequently may be Converted to
Eurodollar Rate Advances. Each Borrowing shall consist of Advances made or
Converted on the same day by the Banks.
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"BUSINESS DAY" means a day of the year other than a Saturday or Sunday
on which banks are not required or authorized to close in New York City and, if
the applicable Business Day relates to any Eurodollar Rate Advances, on which
dealings are carried on in the London interbank market.
"CODE" means the Internal Revenue Code of 1986 and the regulations
promulgated and rulings issued thereunder, each as amended, modified or
supplemented from time to time; or any successor legislation.
"COMMITMENT" has the meaning specified in Section 2.01.
"CONSOLIDATED NET WORTH" means the sum of the capital stock (excluding
treasury stock and capital stock subscribed for and unissued) and surplus
(including earned surplus, capital surplus and the balance of the current profit
and loss account not transferred to surplus) accounts of the Company and its
subsidiaries appearing on a consolidated balance sheet of the Company and its
subsidiaries prepared as of the date of determination in accordance with
generally accepted accounting principles consistent with those applied in the
preparation of the financial statements referred to in Section 5.01(h), after
eliminating all intercompany transactions and all amounts properly attributable
to minority interests, if any, in the stock and surplus of subsidiaries.
"CONVERSION", "CONVERT" and "CONVERTED" each refers to a conversion of
Advances of one Type into another Type of Advances, or the selection of a new,
or the renewal of the same, Interest Period for Eurodollar Rate Advances.
"DEBT" means (i) indebtedness for borrowed money or for the deferred
purchase price of property or services, (ii) obligations as lessee under leases
that have been or should be, in accordance with generally accepted accounting
principles, recorded as capital leases, (iii) obligations under direct or
indirect guaranties in respect of, and obligations (contingent or otherwise) to
purchase or otherwise acquire, or otherwise to assure a creditor against loss in
respect of, indebtedness or obligations of others of the kinds referred to in
clauses (i) or (ii) above, and (iv) liabilities in respect of unfunded vested
benefits under plans covered by Title IV of ERISA.
"DOMESTIC LENDING OFFICE" means, with respect to any Bank, the office
of such Bank specified as its "Domestic Lending Office" opposite its name on
Schedule I hereto or in the Assignment and Acceptance (substantially in the form
of Exhibit B) pursuant to which it became a Bank, or such other office of such
Bank as such Bank may from time to time specify to the Company and the
Administrative Agent.
"DTC" means The Depository Trust Company, as depositary of the Notes,
or any successor entity acting as depositary of the Notes hereunder.
"ELIGIBLE BANK" means a commercial bank or other financial institution
engaged generally in the business of extending credit or purchasing debt
instruments; provided, however, that
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(i) obligations such as those hereunder of such Person are exempt from
registration under the Securities Act of 1933, as amended, (ii) such Person
shall have senior long term debt ratings by S&P and Moody's at least equal to
those of the Company as of the date of this Agreement, and (iii) such Person
shall have combined capital and surplus (as established in its most recent
report of condition to its primary regulator) of not less than $250,000,000 (or
its equivalent in foreign currency).
"ENVIRONMENTAL EVENT" means (i) the generation, storage, disposal,
removal, transportation or treatment of any "Hazardous Substances" (as defined
in any applicable Environmental Laws, and including asbestos and materials
containing asbestos) on any real property owned, occupied or operated by the
Company or on real property adjoining or in the vicinity of such real property,
which through soil or ground water migration could have come to be located at or
on such Property owned, occupied or operated by the Company or any Person for
whose conduct the Company is responsible (any or all of such other property
being "other affected property"); (ii) the receipt by the Company of any notice
or claim of any violation of any Environmental Law or of any action based upon
nuisance, negligence or other tort theory alleging liability on the basis of
improper generation, storage, disposal, removal, transportation or treatment of
Hazardous Substances on any Property owned, occupied or operated by the Company
or on any other affected property; or (iii) the presence or release of Hazardous
Substances at or from any Property owned, occupied or operated by the Company or
any other affected property that has resulted in contamination or deterioration
of any portion of such Property to a level of contamination greater than the
levels permitted or established by any governmental agency having jurisdiction
over the Company or any of such Property or other affected property.
"ENVIRONMENTAL LAW" means any and all statutes, laws, regulations,
ordinances, rules, judgments, orders, decrees, permits, concessions, grants,
franchises, licenses, agreements or other governmental restrictions relating to
the environment or the release of any materials into the environment.
"ERISA" means the Employee Retirement Income Security Act of 1974, as
amended from time to time, and the regulations promulgated and rulings issued
thereunder, in each case as in effect from time to time. References to sections
of ERISA also refer to any applicable successor provisions.
"ERISA AFFILIATE" means any trade or business (whether or not
incorporated) which is a member of a group of which the Company is a member and
which is under common control within the meaning of Section 414 of the Code or
Section 4001 of ERISA.
"EUROCURRENCY LIABILITIES" has the meaning assigned to that term in
Regulation D of the Board of Governors of the Federal Reserve System, as in
effect from time to time.
"EURODOLLAR LENDING OFFICE" means, with respect to any Bank, the office
of such Bank specified as its "Eurodollar Lending Office" opposite its name on
Schedule I hereto (or, if no such office is specified, its Domestic Lending
Office) or in the Assignment and Acceptance
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(substantially in the form of Exhibit B) pursuant to which it became a Bank, or
such other office of such Bank as such Bank may from time to time specify to the
Company and the Administrative Agent.
"EURODOLLAR RATE" means, for any Interest Period for a Eurodollar Rate
Advance resulting from the same Borrowing, an interest rate per annum calculated
as of the first day of such Interest Period in the following manner:
(i) the Eurodollar Rate shall be the rate for deposits in U.S. dollars
for a period equal to such Interest Period that appears on Telerate Page
3750 at approximately 11:00 A.M., London time, on the second Business Day
prior to the first day of such Interest Period, or
(ii) if no rate appears on Telerate Page 3750 on such day, or if
Telerate Page 3750 shall no longer exist, the Administrative Agent will
determine the applicable Eurodollar Rate for such Interest Period by
reference to the rate quoted by Barclays Bank PLC in the London interbank
market for deposits in U.S. dollars in the London Interbank Market on the
second Business Day prior to the first day of such Interest Period for a
period equal to such Interest Period; provided, that if the Administrative
Agent, in its sole discretion, determines that it is not reasonably
practicable to determine a Eurodollar Rate for such Interest Period, then
the Administrative Agent shall not determine such a Eurodollar Rate, and the
provisions of Section 3.08 shall apply.
"EURODOLLAR RATE ADVANCE" means an Advance which bears interest as
provided in Section 3.04(b).
"EVENT OF DEFAULT" has the meaning specified in Section 7.01.
"Facility Fee" has the meaning assigned to that term in Section
3.02(a).
A "FAILED REMARKETING" shall be deemed to have occurred on any Interest
Rate Adjustment Date (as defined in the Note Indenture) on which a Remarketing
Agent (and Standby Remarketing Agent, if any), by 12:00 noon (New York City
time), shall have failed to remarket, at a price equal to 100% of the principal
amount thereof, plus accrued interest, if any, any portion of the Notes tendered
for purchase to such Remarketing Agent by the Beneficial Owners thereof on such
date.
"FEDERAL FUNDS EFFECTIVE RATE" means, for any day, the weighted average
of the rates on overnight federal funds transactions with members of the Federal
Reserve System arranged by federal funds brokers, as published on the next
succeeding Business Day by the Federal Reserve Bank of New York, or, if such
rate is not so published for any day which is a Business Day, the average of the
quotations for the day of such transactions received by the Administrative Agent
from three federal funds brokers of recognized standing selected by it.
"FISCAL YEAR" means the annual accounting period adopted by the
Company.
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"GOVERNING BODY" of any specified Person means the board of directors
or board of trustees of such Person or any duly authorized committee of that
board, or if there shall be no board of trustees or board of directors, then the
Person or body that pursuant to law or the organizational documents of such
Person is vested with powers similar to those vested in a board of trustees or a
board of directors, and, with respect to the Company, its Board of Directors.
"GOVERNMENTAL AUTHORITY" means any foreign governmental authority, the
United States of America, any state of the United States and any political
subdivision of any of the foregoing, and any agency, department, commission,
board, bureau or court or other judicial or administrative tribunal having
jurisdiction over the Administrative Agent, any Bank, any Remarketing Agent or
the Company, or over any Property of the Company.
"INTEREST PERIOD" means, for each Eurodollar Rate Advance resulting
from the same Borrowing, the period commencing on the date of Conversion of a
Base Rate Advance or Eurodollar Rate Advance into such Eurodollar Rate Advance
and ending on the last day of the period selected by the Company pursuant to the
provisions below. The duration of each such Interest Period shall be one, two,
three or six months, as the Company may select; provided, however, that:
(i) the duration of any Interest Period which commences before the
Termination Date and would otherwise end after the Termination Date
shall end on the Termination Date;
(ii) the duration of any Interest Period which would otherwise end
on a day later than the third Business Day following the last day of
the sixth month following the date of the Borrowing resulting in such
Eurodollar Rate Advance shall end on such day (such date the "REQUIRED
CONVERSION DATE" for such Advance);
(iii) Interest Periods commencing on the same date for Eurodollar
Advances resulting from the same Borrowing shall be of the same
duration; and
(iv) whenever the last day of any Interest Period would otherwise
occur on a day other than a Business Day, the last day of such Interest
Period shall be extended to occur on the next succeeding Business Day,
unless such extension would cause the last day of such Interest Period
to occur in the next following calendar month, in which event the last
day of such Interest Period shall occur on the next preceding Business
Day.
"INTEREST RATE ADJUSTMENT DATE" has the meaning specified in the Note
Indenture.
"LEGAL REQUIREMENT" means any law, statute, ordinance, decree,
requirement, order, judgment, rule or regulation (or interpretation of any of
the foregoing) of, and the terms of any license or permit issued by, any
Governmental Authority.
"LIBOR RESERVE PERCENTAGE" of any Bank for the Interest Period for any
Eurodollar Rate Advance means the reserve percentage applicable during such
Interest Period (or if more than one such percentage shall be so applicable, the
daily average of such percentages for those days in such Interest Period during
which any such percentage shall be so applicable) under regulations
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issued from time to time by the Board of Governors of the Federal Reserve System
(or any successor) for determining the maximum reserve requirement (including,
without limitation, any emergency, supplemental or other marginal reserve
requirement) for such Bank with respect to liabilities or assets consisting of
or including Eurocurrency Liabilities having a term equal to such Interest
Period.
"LIEN" means any mortgage, pledge, charge, encumbrance, security
interest, collateral assignment or other lien or restriction of any kind,
whether based on common law, constitutional provision, statute or contract, and
shall include reservations, exceptions, encroachments, easements, rights-of-way,
covenants, conditions, restrictions, leases and other title exception (including
any conditional sale or other title retention agreement, any financing lease
involving substantially the same economic effect as any of the foregoing and
filing of any financing statement under the Uniform Commercial Code or
comparable law of any jurisdiction).
"LIQUIDITY PROVIDER NOTES" means Purchased Notes issued in the form
provided therefor in the Note Indenture.
"MAJORITY BANKS" means at any time Banks holding at least 66-2/3% of
the Commitments.
"MAXIMUM RATE" means that rate of interest equal to fifteen percent
(15%) per annum or such higher rate as may be established from time to time by
the Board of Directors of the Company as the maximum rate of interest payable by
the Company hereunder.
"MOODY'S" shall mean ▇▇▇▇▇'▇ Investors Service, Inc., or any successor
thereto.
"▇▇▇▇▇'▇ RATING" shall mean, on any date of determination, the debt
rating most recently announced by Moody's with respect to the Senior Secured
Indebtedness of the Company.
"MULTIEMPLOYER PLAN" means a "multiemployer plan" as defined in Section
4001(a)(3) of ERISA.
"MULTIPLE EMPLOYER PLAN" means an employee benefit plan, other than a
Multiemployer Plan, subject to Title IV of ERISA to which the Company or any
ERISA Affiliate, and one or more employers other than the Company or an ERISA
Affiliate, is making or accruing an obligation to make contributions or, in the
event that any such plan has terminated, to which the Company or any ERISA
Affiliate made or accrued an obligation to make contributions during any of the
five plan years preceding the date of termination of such plan.
"NOTE" means any 1993 Series B Note Due 2033, issued by the Company
pursuant to the Note Indenture, and initially sold by, to or through ▇▇▇▇▇▇
▇▇▇▇▇▇▇ & Co. Incorporated, Citicorp Securities, Inc. and ▇▇▇▇▇▇ Brothers Inc.
"NOTE INDENTURE" has the meaning specified in the Preliminary
Statement.
"NOTICE OF FAILED REMARKETING AND BORROWING REQUEST" has the meaning
specified in
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Section 3.01.
"OFFICER'S CERTIFICATE" means a certificate signed by the Chairman of
the Board, the President, any Vice President, the Treasurer, Assistant
Treasurer, the Secretary or an Assistant Secretary of the Company and delivered
to the Administrative Agent for the benefit of the Banks.
"PBGC" means the Pension Benefit Guaranty Corporation or any successor
thereto.
"PERCENTAGE" means, for any Bank on any date of determination, the
percentage obtained by dividing such Bank's Commitment on such date by the total
of the Commitments on such date, and multiplying the quotient so obtained by
100%.
"PERSON" means an individual or a corporation, partnership, limited
liability company, trust, incorporated or unincorporated association, joint
venture, government (or an agency or political subdivision thereof) or any
entity of any kind.
"PLAN" means an employee benefit plan (other than a Multiemployer Plan)
maintained for employees of the Company or any ERISA Affiliate and covered by
Title IV of ERISA.
"PLAN TERMINATION EVENT" means (i) a "Reportable Event" described in
Section 4043 of ERISA and the regulations issued thereunder (other than a
Reportable Event not subject to the provision for 30-day notice to the PBGC
under such regulations), or (ii) the withdrawal of the Company or any ERISA
Affiliate from a Plan during a plan year in which it was a "substantial
employer" as defined in Section 4001(a)(2) of ERISA, or (iii) the filing of a
notice of intent to terminate a Plan or the treatment of a Plan amendment as a
termination under Section 4041 of ERISA, or (iv) the institution of proceedings
to terminate a Plan by the PBGC, or (v) any other event or condition which might
constitute grounds under Section 4042 of ERISA for the termination of, or the
appointment of a trustee to administer, any Plan.
"PLEDGED BOND" has the meaning specified in the Preliminary Statement.
"PROPERTY" means any interest in any kind of property or asset, whether
real, personal or mixed, or tangible or intangible.
"PROSPECTUS" means the Prospectus relating to the Notes, dated October
6, 1993, as supplemented by the Prospectus Supplement, dated October 6, 1993,
and the Prospectus Supplement, dated August 15, 1996, and as further amended,
supplemented or otherwise modified from time to time, together with the
documents incorporated therein by reference.
"PURCHASED NOTE" means any Note purchased by any Remarketing Agent with
the proceeds of an Advance.
"RELATED DOCUMENTS" means this Agreement, the Note Indenture, the
Notes, the Remarketing Agreement, the Mortgage, and any other agreement or
instrument relating hereto or thereto.
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"REMARKETING AGENT" means each Person serving in the capacity of
Remarketing Agent pursuant to the Remarketing Agreement (including, without
limitation, any Standby Remarketing Agent), which initially shall be ▇▇▇▇▇▇
Brothers Inc., Banc One Capital Markets, Inc. and Barclays Capital Inc., and
each such Person's successors and assigns.
"REMARKETING AGREEMENT" means the Remarketing Agreement, dated as of
October 29, 1999, as amended, supplemented or otherwise modified from time to
time, among the Company, ▇▇▇▇▇▇ Brothers Inc., Banc One Capital Markets, Inc.
and Barclays Capital Inc., and any similar such agreement by the Company with
any successor Remarketing Agent.
"REQUIRED CONVERSION DATE" has the meaning specified in the definition
of "Interest Period" set forth in this Section 1.01.
"S&P" shall mean Standard & Poor's Ratings Services, a division of The
▇▇▇▇▇▇-▇▇▇▇ Companies, Inc., or any successor thereto.
"S&P RATING" shall mean, on any date of determination, the debt rating
most recently announced by S&P with respect to the Senior Secured Indebtedness
of the Company.
"SECURITIES LAWS" means all Federal and state laws applicable to the
sale of Notes or other securities, including, without limitation, the Securities
Act of 1933, as amended, and all rules, regulations and administrative
interpretations thereof; provided, however, that the term "Securities Laws" does
not include the ▇▇▇▇▇-▇▇▇▇▇▇▇▇ Act of 1933, as amended, or any rules,
regulations or administrative interpretations thereof.
"SENIOR SECURED INDEBTEDNESS" of the Company means mortgage bonds of
the Company issued under the Mortgage or, if at any relevant time no such
mortgage bonds shall be outstanding, long-term senior secured, non-credit
enhanced debt of the Company outstanding at such time carrying the highest
applicable ratings assigned by any nationally recognized rating organizations in
the United States to any such senior debt of the Company at such time.
"STANDBY REMARKETING AGENT" means any Person designated as a Standby
Remarketing Agent by the Company or otherwise serving in such capacity pursuant
to the Remarketing Agreement.
"TERMINATION DATE" means the earlier to occur of October 24, 2000, as
such date may be extended pursuant to Section 2.04, and the date of termination
in whole of the Commitments pursuant to Section 2.02(b) or 7.02.
"TRUSTEE" means Bankers Trust Company, as trustee under the Note
Indenture, and any successor thereto.
"UNREMARKETED NOTES" means any Notes tendered for remarketing, but not
successfully remarketed, in connection with the occurrence of a Failed
Remarketing.
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SECTION 1.02. COMPUTATION OF TIME PERIODS. In this Agreement in the
computation of periods of time from a specified date to a later specified date,
the word "from" means "from and including" and the words "to" and "until" each
means "to but excluding".
SECTION 1.03. ACCOUNTING TERMS. All accounting terms not specifically
defined herein shall be construed in accordance with generally accepted
accounting principles consistently applied, except as otherwise stated or
defined herein. All accounting terms shall be construed taking into account
changes in generally accepted accounting principles mandated by the Financial
Accounting Standards Board or any similar accounting authority of comparable
standing.
ARTICLE II
COMMITMENTS; FAILED REMARKETINGS; PURCHASED NOTES
SECTION 2.01. THE COMMITMENTS. Each Bank severally agrees, on the terms
and conditions hereinafter set forth, to make Advances for the account of the
Company to one or more applicable Remarketing Agents for the purchase of
Unremarketed Notes, as provided herein, from time to time on any Interest Rate
Adjustment Date (as defined in the Note Indenture) during the period from the
date hereof until the Termination Date in an aggregate amount that, when added
to the aggregate outstanding principal amount of all Advances theretofore made
by such Bank and the principal amount of all Purchased Notes then outstanding to
such Bank, shall not exceed at any time outstanding the amount set opposite such
Bank's name on Schedule I hereto, as such amount may be reduced pursuant to
Section 2.02 (such Bank's "COMMITMENT"). Each Borrowing shall consist of
Advances made or Converted on the same day by the Banks ratably according to
their respective Commitments.
SECTION 2.02. REDUCTION OF THE COMMITMENTS.
(a) The Company may, upon at least five Business Days' notice to the
Administrative Agent, terminate in whole or reduce ratably in part the unused
portions of the respective Commitments of the Banks; provided, however, that any
such partial reduction shall be in the aggregate amount of $5,000,000, or an
integral multiple of $1,000,000 in excess thereof. Commitments terminated or
reduced by the Company hereunder may not be reinstated.
(b) The Administrative Agent shall promptly notify the Banks upon
receipt of any notification from the Company of one or more amendments to or
modifications of any Related Documents. Within ten Business Days following
receipt by the Banks of any such notification from the Administrative Agent, the
Majority Banks may elect, upon 30 days' prior notice to the Company, to
terminate in whole or reduce ratably in part their Commitments; provided,
however, that any such partial reduction shall be in the aggregate amount of
$5,000,000, or an integral multiple of $1,000,000 in excess thereof.
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SECTION 2.03. FAILED REMARKETINGS; PURCHASES OF PURCHASED NOTES; GRANT
OF AUTHORITY.
(a) The Company hereby irrevocably authorizes and directs each
Remarketing Agent to (i) notify the Administrative Agent and the Company by
12:00 noon (New York City time) upon the occurrence of any Failed Remarketing
involving Unremarketed Notes tendered to that Remarketing Agent, and (ii)
request and receive the proceeds of Advances made by the Banks hereunder, and
apply such proceeds for the purpose of purchasing such Unremarketed Notes at a
price equal to 100% of the outstanding principal amount thereof. The
authorization of each Remarketing Agent by the Company pursuant to this
subsection is coupled with an interest and is irrevocable.
(b) Upon (and only upon) receipt by the Trustee of (i) the proceeds of
Advances and (ii) all accrued and unpaid interest, if any, due from the Company
with respect to Unremarketed Notes subject to a Failed Remarketing, the
applicable Remarketing Agent, in accordance with the terms and conditions of the
Remarketing Agreement, will (A) make or cause the Trustee to make payment to the
DTC Participant (as defined in the Note Indenture) of each tendering Beneficial
Owner of such Unremarketed Notes, by book entry through DTC against delivery of
such Beneficial Owner's tendered Notes, of the purchase price of such tendered
Notes, and (B) arrange or cause the Trustee to arrange for the crediting through
DTC for the account of the Administrative Agent (or such other account or
accounts at DTC as the Administrative Agent may direct) of such Unremarketed
Notes, which shall be registered in the name of the Administrative Agent or its
nominee for the ratable benefit of the Banks, and which shall be Purchased Notes
issued in the form of one or more Liquidity Provider Notes in accordance with
the terms of this Agreement and the Note Indenture.
SECTION 2.04. EXTENSION OF TERMINATION DATE. Unless the Commitments
shall have been terminated in whole or an Event of Default or an event which,
with the giving of notice or the passage of time, or both, would constitute an
Event of Default shall have occurred and then be continuing, at least 30 days
but not more than 60 days prior to the then-effective Termination Date, the
Company, by written notice to the Administrative Agent, may request the Banks to
consent to an extension of the Termination Date to the last Business Day
occurring not more than 364 days after the Termination Date then in effect. Each
Bank may, in its sole and absolute discretion, determine whether to consent to
such request and shall notify the Administrative Agent of its determination not
earlier than 30 days prior to the then-effective Termination Date. Failure by
any Bank to respond by the tenth day prior to the then-effective Termination
Date shall be deemed to be a denial of the Company's request by such Bank. If
such request shall have been consented to by all of the Banks, the
Administrative Agent shall notify the Company in writing of such Banks'
unanimous consent, and such extension shall become effective upon the
then-effective Termination Date if the Company shall have delivered (on or prior
to the then-effective Termination Date) to the Administrative Agent and each
Bank, a certificate, dated on or as of the then-effective Termination Date, of a
duly authorized officer of the Company as to the accuracy, both before and after
giving effect to such proposed extension, of the representations and warranties
set forth in Section 5.01, and as to the absence, both before and after giving
effect to such proposed extension, of any Event of Default or event which with
the giving of notice of or the passage of time, or both, would constitute an
Event of Default.
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SECTION 2.05. COMPANY MANDATORY AND OPTIONAL REPURCHASE OF PURCHASED
NOTES.
(a) On the Termination Date, whether scheduled or resulting from the
termination in whole of the Commitments pursuant to Section 2.02(b) or 7.02, and
on any date on which the interest rate applicable to any Advance would exceed
the Maximum Rate pursuant to Section 3.04, the Company shall be required to
purchase all outstanding Purchased Notes from the Banks; provided, however, if
and for so long as (i) no Event of Default shall have occurred and be continuing
and (ii) the interest rate applicable to any Advance shall not have exceeded the
Maximum Rate, the Company may, by written notice delivered to the Administrative
Agent no less than 5 Business Days prior to the Termination Date (which notice
shall be promptly provided to each Bank by the Administrative Agent), extend,
for a period of up to one year following the date of any Borrowing resulting in
the purchase of Purchased Notes, the date for the performance of its obligation
to purchase such Purchased Notes from the Banks under this subsection (a);
provided, further, that in the event of such extension, the Facility Fee and
interest shall continue to be payable on the outstanding principal amount of
such Purchased Notes in accordance with the Purchased Notes and this Agreement..
(b) The Company may, at its option, purchase all outstanding Purchased
Notes from the Banks at any time prior to being required to do so pursuant to
clause (a) of this Section 2.05 upon written notice to the Administrative Agent
not less than three (3) Business Days prior to the date of such purchase;
provided, however, that no Bank shall be required to tender any Purchased Note
to the Company for any such purchase unless (i) in the opinion of such Bank in
its sole and absolute discretion, (A) such tender and purchase would not violate
any material law, rule or regulation applicable to such Bank at the time of such
tender and purchase and (B) such tender and purchase of such Purchased Notes
will not violate any Securities Laws in effect at such time, and (ii) such Bank
shall have received, in form and substance satisfactory to such Bank in its sole
and absolute discretion, an opinion of counsel to the Company that all necessary
actions shall have been taken in order that such tender and purchase will be in
compliance with all applicable Securities Laws in effect at such time, and as to
such other matters as such Bank may reasonably request.
(c) Any purchase by the Company of Purchased Notes from the Banks
pursuant to this Section 2.05 shall be made without recourse to or warranty from
the Banks, for a price equal to 100% of the outstanding principal amount thereof
plus (i) all accrued and unpaid interest, if any, thereon and (ii) any payment
required to be made pursuant to Section 3.11. The payment of the purchase price
for the Purchased Notes by the Company shall not be contingent on any receipt by
the Company of the proceeds of any subsequent remarketing of such Purchased
Notes. Such price shall be paid by crediting the account of the Administrative
Agent at DTC (or such other account or accounts at DTC as the Administrative
Agent may direct) with immediately available funds, in return for which the
Administrative Agent or its nominee will instruct DTC to credit the account of
the Company at DTC (or such other account or accounts at DTC as the Company may
direct) with the Purchased Notes.
SECTION 2.06. REMARKETING OF PURCHASED NOTES. Notwithstanding any
provision of
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this Agreement, any Related Document, or any other agreement or instrument
whatsoever to the contrary, no Bank shall be required to tender any Purchased
Note to any Remarketing Agent for remarketing (and no Purchased Note shall be
deemed to have been tendered to a Remarketing Agent for remarketing pursuant to
the provisions of such Purchased Note or otherwise) unless, (i) in the opinion
of such Bank in its sole and absolute discretion, (A) such tender and
remarketing would not violate any material law, rule or regulation applicable to
such Bank at the time of such tender and remarketing and (B) such tender and
remarketing will not violate any Securities Laws in effect at such time, and
(ii) such Bank shall have received, in form and substance satisfactory to such
Bank in its sole and absolute discretion, an opinion of counsel to the Company
that all necessary actions shall have been taken in order that such tender and
remarketing will be in compliance with all applicable Securities Laws as in
effect at such time and as to such other matters as such Bank may reasonably
request. Each Bank shall promptly notify the Company and each Remarketing Agent
upon its receipt in accordance with the preceding sentence of the required legal
opinion. The Company hereby agrees (1) to indemnify each Bank, its shareholders,
affiliates, officers, directors, employees and agents from and against any and
all claims, damages, losses, liabilities and expenses that may be incurred by or
asserted against any of such parties with respect to any untrue statement or
alleged untrue statement of a material fact or omission or alleged omission to
state a material fact required to be stated therein or necessary to make the
statements therein not misleading in any offering document filed with the
Securities and Exchange Commission or otherwise used in connection with the
remarketing of Purchased Notes tendered by such Bank to the applicable
Remarketing Agents and (2) in the event that the foregoing indemnification shall
be unavailable under applicable Securities Laws, that the Company and such Bank
shall each contribute to the satisfaction of any such claims, damages, losses,
liabilities and expenses in proportion to their relative benefits received from
the offering of the Notes (provided, that the relative benefits from any
remarketing shall be deemed to be such that such Bank shall be responsible for
that portion of the aggregate claims, damages, losses, liabilities and expenses
represented by the ratio of the interest earned by such Bank on Purchased Notes
included in such remarketing to the aggregate principal amount of all Notes
outstanding at the time of such remarketing, and the Company shall be
responsible for the balance). Nothing in this Section 2.06 shall in any way
impair the Company's obligations to repurchase Purchased Notes pursuant to
Section 2.05(a), above. The Company's indemnification obligations under this
Section 2.06 shall survive the repayment of all amounts owing to the
Administrative Agent and the Banks under the Related Documents and the
termination of the Commitments.
ARTICLE III
AMOUNTS AND TERMS OF THE ADVANCES
SECTION 3.01. MAKING THE ADVANCES.
(a) Each Borrowing shall consist solely of Base Rate Advances and shall
be made on notice, given not later than 12:00 noon (New York City time) on the
Interest Rate Adjustment Date of the proposed Borrowing, by the applicable
Remarketing Agent to the Administrative Agent (with a copy to the Company),
which shall give to each Bank prompt notice thereof by telephone or telecopier,
telex or cable. Each such notice (a "NOTICE OF FAILED REMARKETING AND
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BORROWING REQUEST") shall be by telephone or telecopier, confirmed in writing,
in substantially the form of Exhibit A hereto, and shall (i) specify the
principal amount of Unremarketed Notes tendered to the applicable Remarketing
Agent in the Failed Remarketing, (ii) confirm that the applicable Remarketing
Agent has received, or has informed the Company of its need to receive, from the
Company all accrued and unpaid interest on such Unremarketed Notes, and (iii)
identify the requested date and aggregate amount of the requested Borrowing.
Each Bank shall, before 2:00 P.M. (New York City time) on the date of such
Borrowing, make available for the account of its Domestic Lending Office to the
Administrative Agent at its address referred to in Section 9.02, in same day
funds, such Bank's ratable portion of such Borrowing. Subject to the fulfillment
of the applicable conditions set forth in Article IV, promptly following receipt
of such funds by the Administrative Agent, but no later than 3:00 p.m. (New York
City time) on the date of such Borrowing, the Administrative Agent will
transfer, in same-day funds, such funds to such account as may from time to time
be identified in a notice delivered by the Trustee to the Administrative Agent
(with copies of such notice to the Borrower and the Remarketing Agents).
(b) Unless the Administrative Agent shall have received notice from a
Bank prior to the date of any Borrowing that such Bank will not make available
to the Administrative Agent such Bank's ratable portion of such Borrowing, the
Administrative Agent may assume that such Bank has made such portion available
to the Administrative Agent on the date of such Borrowing in accordance with
subsection (a) of this Section 3.01 and the Administrative Agent may, in
reliance upon such assumption, make available to the applicable Remarketing
Agent on such date a corresponding amount. If and to the extent that such Bank
shall not have so made such ratable portion available to the Administrative
Agent, such Bank and the Company severally agree to repay to the Administrative
Agent forthwith on demand such corresponding amount together with interest
thereon, for each day from the date such amount is made available to the
applicable Remarketing Agent until the date such amount is repaid to the
Administrative Agent, at (i) in the case of the Company, the interest rate
applicable at the time to the Purchased Notes purchased with the proceeds of the
Advances comprising such Borrowing (or, if no Purchased Notes were purchased
with such proceeds, the interest rate applicable at the time to Advances
comprising such Borrowing), and (ii) in the case of such Bank, the Federal Funds
Effective Rate. If such Bank shall repay to the Administrative Agent such
corresponding amount, such amount so repaid shall constitute such Bank's Advance
as part of such Borrowing for purposes of this Agreement.
(c) The failure of any Bank to make the Advance to be made by it as
part of any Borrowing shall not relieve any other Bank of its obligation, if
any, hereunder to make its Advance on the date of such Borrowing, but no Bank
shall be responsible for the failure of any other Bank to make the Advance to be
made by such other Bank on the date of any Borrowing.
SECTION 3.02. FEES.
(a) The Company agrees to pay to the Administrative Agent for the
account of each Bank a facility fee (the "FACILITY FEE") at a rate per annum
equal to the Applicable Rate in effect from time to time on the average daily
amount of such Bank's Commitment (regardless of usage) from the date hereof, in
the case of each Bank listed on the signature pages hereto, and from the
effective date specified in the Assignment and Acceptance substantially in the
form of Exhibit B hereto pursuant to which it became a Bank pursuant to Section
9.06 hereof, in the case of any
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other Bank, until the Termination Date, payable on the last day of each March,
June, September and December during the term of such Bank's Commitment,
commencing December 31, 1999, and on the Termination Date.
(b) The Company agrees to pay the Administrative Agent, for its own
account, such fees at such times and in such amounts as agreed upon in a letter
agreement between the Company and the Administrative Agent (or as otherwise
agreed in writing by the Company and the Administrative Agent from time to
time). The fees described in this Section 3.02(b) shall not be refundable under
any circumstances.
SECTION 3.03. REPAYMENT; PREPAYMENTS.
(a) The Company shall repay the unpaid principal amount of each Advance
made by each Bank in accordance with the terms of the Purchased Notes acquired
with the proceeds of such Advance. The purchase of a Purchased Note with the
proceeds of any Advance, coupled with the crediting through DTC for the account
of the Administrative Agent or its nominee of such Purchased Note, shall, for
all purposes, be deemed to constitute repayment of the principal amount of such
Advance.
(b) In the event that Purchased Notes are not, for any reason,
purchased with the proceeds of any Advance and credited through DTC for the
account of the Administrative Agent or its nominee, such Advance shall become
immediately due and payable by the Company hereunder, together with interest
thereon, as hereinafter provided.
(c) If and to the extent that the aggregate principal amount of
Advances owed to the Banks on any date shall exceed the aggregate amount of the
Commitments on such date, the Company shall prepay on such date, either directly
or by effecting purchases of Purchased Notes, an amount at least equal to such
excess.
SECTION 3.04. INTEREST. The Company shall pay interest on the unpaid
principal amount of each Advance made by each Bank from the date of such Advance
until such principal amount shall be paid in full, at the following interest
rates per annum:
(a) BASE RATE ADVANCES. If such Advance is a Base Rate Advance
(including, without limitation, a Base Rate Advance Converted from a Eurodollar
Rate Advance), a rate per annum equal at all times to the sum of the Base Rate
in effect from time to time plus the Applicable Rate. Such interest shall be
payable by the Company on the last day of each March, June, September and
December (or on such other dates as the Company and the Banks may agree from
time to time), commencing on the first such date to occur following the date
hereof as the case may be, and shall be payable on the Termination Date, any
date of Conversion of such Base Rate Advance into a Eurodollar Rate Advance and,
as provided in subsection (d), below, on any other date on which the Purchased
Notes purchased with such Advance shall be remarketed by a Remarketing Agent.
(b) EURODOLLAR RATE ADVANCES. If such Advance is a Eurodollar Rate
Advance, a rate per annum equal at all times during the Interest Period for such
Eurodollar Rate Advance to the
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sum of the Eurodollar Rate for such Interest Period plus the Applicable Rate,
payable on the last day of such Interest Period (and, in the case of any
Interest Period of six months, on the last day of the third month of such
Interest Period).
(c) OVERDUE PRINCIPAL PAYMENTS. Notwithstanding the foregoing, any
amount of principal of any Advance which is not paid when due (whether at stated
maturity, by acceleration or otherwise) shall bear interest, from the date on
which such amount is due until such amount is paid in full, payable on demand,
at a rate per annum equal at all times to the greater of (i) 2.0% per annum
above the Base Rate in effect from time to time and (ii) 2.0% per annum above
the rate per annum required to be paid on such Advance immediately prior to the
date on which such amount became due; provided, however, that at no time shall
the interest rate per annum applicable to the Advances exceed the Maximum Rate.
The Company promptly shall repurchase Purchased Notes purchased with any Advance
pursuant to Section 2.05(a) if the interest rate applicable to such Advance
would exceed the Maximum Rate but for the prohibition contained in the preceding
sentence.
(d) INTEREST PAYMENTS ON PURCHASED NOTES. This Agreement constitutes
the entire agreement of the Company and the Banks with respect to the interest
rates and interest payment terms applicable to any Purchased Notes. All payments
of interest by the Company with respect to and in accordance with the terms of
any Purchased Note and this Agreement shall, for all purposes, satisfy the
obligations of the Company to pay such interest on the unpaid principal amount
of the Advance which was utilized by the applicable Remarketing Agent to
purchase such Purchased Note. The Company shall pay all accrued and unpaid
interest on the unpaid principal amount of each Purchased Note prior to any
remarketing thereof by a Remarketing Agent.
SECTION 3.05. CONVERSION OF ADVANCES.
(a) Subject to subsections (c) and (d) below, the Company may on any
Business Day, upon notice given to the Administrative Agent not later than 11:00
A.M. (New York City time) on the third Business Day prior to the date of the
proposed Conversion and subject to the provisions of Sections 3.08, 3.12 and
4.02, Convert all Advances of one Type resulting from the same Borrowing into
Advances of another Type or, in the case of Eurodollar Rate Advances, select a
new or renew the same Interest Period for such Eurodollar Rate Advances;
provided, however, that any Conversion of Eurodollar Rate Advances into Base
Rate Advances shall be made on, and only on, the last day of an Interest Period
for such Eurodollar Rate Advances. Each such notice of a Conversion shall
specify (i) the date of such Conversion, (ii) the Advances to be Converted, and
(iii) if such Conversion is into, or with respect to, Eurodollar Rate Advances,
the duration of the Interest Period for such Eurodollar Rate Advances.
(b) If the Company shall fail to select the duration of any Interest
Period for any Eurodollar Rate Advances in accordance with the provisions
contained in the definition of "INTEREST PERIOD" in Section 1.01 and subsection
(a) above, or upon the occurrence and during the continuation of an Event of
Default, the Administrative Agent will forthwith so notify the Company and the
Banks and such Advances will automatically, on the last day of the then existing
Interest Period therefor, Convert into Base Rate Advances.
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(c) Any Eurodollar Rate Advance outstanding on the Required Conversion
Date for such Eurodollar Rate Advance shall be Converted to a Base Rate Advance
on such day; provided, however, that if such Conversion would result in a
reduction of the interest rate per annum payable by the Company with respect to
such Advance, the Company and the Banks shall negotiate a substitute interest
rate to apply to such Eurodollar Rate Advance following such Conversion to a
Base Rate Advance to their mutual satisfaction (which substitute interest rate
shall be an all-in rate not lower than the rate applicable to such Eurodollar
Rate Advance immediately prior to such substitution).
(d) No Base Rate Advance shall be Converted to a Eurodollar Rate
Advance following the Required Conversion Date with respect thereto.
SECTION 3.06. INCREASED COSTS; CAPITAL ADEQUACY.
(a) In the event that after the date hereof the implementation of or
any change in any law or regulation, or any guideline or directive (whether or
not having the force of law) or the interpretation or administration thereof, in
each case by any court, central bank or administrative or governmental authority
charged with the administration thereof shall:
(i) subject any Bank to any tax of any kind with respect to this
Agreement or its Advances or the transactions contemplated hereby or
shall change the basis of taxation of such Bank (other than a change in
the rate of tax on the overall net income of such Bank); or
(ii) impose, modify or deem applicable any reserve, special
deposit, capital adequacy or similar requirement (other than, in the
case of Eurodollar Rate Advances, any change by way of imposition or
increase of reserve requirements, included in the LIBOR Reserve
Percentage); or
(iii) impose on such Bank any other condition;
and as a result of any of the foregoing, in the sole opinion of such Bank, there
shall be any increase in the cost to any Bank of agreeing to make or making,
funding or maintaining Eurodollar Rate Advances, then the Company shall from
time to time, upon demand by such Bank (with a copy of such demand to the
Administrative Agent), pay to the Administrative Agent for the account of such
Bank additional amounts sufficient to compensate such Bank for such increased
cost. A certificate as to the amount of such increased cost, submitted to the
Company and the Administrative Agent by such Bank, shall be conclusive and
binding for all purposes, absent manifest error.
(b) In the event that the application of any existing law, rule,
regulation or the interpretation thereof by any court, central bank or
governmental authority or any adoption of or change in any applicable law, rule
or regulation or the interpretation thereof by any court or governmental
authority or the compliance by any Bank with any request, guideline, order or
directive of any court, central bank or governmental authority, in each case
whether or not having the force of law, or the introduction of any such new
laws, rules or regulations (including, without
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limitation, the issuance of any final rule, regulation or guideline) shall
impose, modify or deem applicable capital adequacy or similar requirements
respecting assets (funded or contingent), of, or credit extended by or
commitments to extend credit by, any Bank, or otherwise deem applicable to the
obligations of any Bank under this Agreement, capital adequacy or similar
requirements, and the net result of any of the foregoing is to reduce the rate
of return on such Bank's capital as a consequence of its obligations hereunder
to a level below that which such Bank would have received but for the imposition
of such requirement (taking into consideration such Bank's capital adequacy
policies), then the Company shall from time to time upon the demand by such Bank
(with a copy of such demand to the Administrative Agent), pay to the
Administrative Agent for the account of such Bank additional amounts to
compensate such Bank for such reduced rate of return. A certificate as to the
calculation of such additional amounts submitted by such Bank to the Company and
the Administrative Agent shall be conclusive and binding for all purposes absent
manifest error.
SECTION 3.07. ADDITIONAL INTEREST ON EURODOLLAR RATE ADVANCES. The
Company shall pay to each Bank, so long as such Bank shall be required under
regulations of the Board of Governors of the Federal Reserve System to maintain
reserves with respect to liabilities or assets consisting of or including
Eurocurrency Liabilities, additional interest on the unpaid principal amount of
each Eurodollar Rate Advance of such Bank, from the date of such Advance until
such principal amount is paid in full, at an interest rate per annum equal at
all times to the difference obtained by subtracting (i) the Eurodollar Rate for
the Interest Period for such Eurodollar Rate Advance, from (ii) the rate
obtained by dividing such Eurodollar Rate by a percentage equal to 100% minus
the LIBOR Reserve Percentage of such Bank for such Interest Period or such term,
as the case may be, payable on each date on which interest is payable on such
Advance. Such additional interest shall be determined by such Bank and notified
to the Company through the Administrative Agent.
SECTION 3.08. INTEREST RATE DETERMINATION. The Administrative Agent
shall determine the Eurodollar Rate from time to time in accordance with the
provisions of this Agreement. If, for any reason, the Administrative Agent in
its sole discretion determines that it is unable to so determine the Eurodollar
Rate, the right of the Company to select Eurodollar Rate Advances shall be
suspended until the Administrative Agent shall notify the Company and the Banks
that the circumstances causing such suspension no longer exist, and such
Eurodollar Rate Advance will automatically, on the last day of the then existing
Interest Period therefor, Convert into a Base Rate Advance.
SECTION 3.09. PAYMENTS AND COMPUTATIONS.
(a) The Company shall make each payment hereunder not later than 11:00
A.M. (New York City time) on the day when due in U.S. dollars to the
Administrative Agent at its address referred to in Section 9.02 in same day
funds. Upon receipt of any payments of principal, interest, facility fees or
other amounts payable hereunder or under the Purchased Notes, the Administrative
Agent will promptly cause to be distributed like funds relating to such payments
ratably (other than amounts payable pursuant to Section 3.06) to the Banks for
the account of their respective Applicable Lending Offices, and like funds
relating to the payment of any other amount payable to any Bank to such Bank,
for the account of its Applicable Lending Office, in each case to be
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applied in accordance with the terms of this Agreement.
(b) All computations of interest based on the Base Rate shall be made
by the Administrative Agent on the basis of a year of 365 or 366 days, as the
case may be, and all computations of interest based on the Eurodollar Rate and
all computations of facility fees shall be made by the Administrative Agent on
the basis of a year of 360 days, in each case for the actual number of days
(including the first day but excluding the last day) occurring in the period for
which such interest or facility fees are payable. Each determination by the
Administrative Agent of an interest rate hereunder shall be conclusive and
binding for all purposes, absent manifest error.
(c) Whenever any payment hereunder shall be stated to be due on a day
other than a Business Day, such payment shall be made on the next succeeding
Business Day, and such extension of time shall in such case be included in the
computation of payment of interest or facility fee, as the case may be;
provided, however, if such extension would cause payment of interest on or
principal of Eurodollar Rate Advances to be made in the next following calendar
month, such payment shall be made on the next preceding Business Day.
(d) Unless the Administrative Agent shall have received notice from the
Company prior to the date on which any payment is due to the Banks hereunder or
under the Purchased Notes that the Company will not make such payment in full,
the Administrative Agent may assume that the Company has made such payment in
full to the Administrative Agent on such date and the Administrative Agent may,
in reliance upon such assumption, cause to be distributed to each Bank on such
due date an amount equal to the amount then due such Bank. If and to the extent
the Company shall not have so made such payment in full to the Administrative
Agent, each Bank shall repay to the Administrative Agent forthwith on demand
such amount distributed to such Bank together with interest thereon, for each
day from the date such amount is distributed to such Bank until the date such
Bank repays such amount to the Administrative Agent, at the Federal Funds
Effective Rate.
SECTION 3.10. SHARING OF PAYMENTS, ETC. If any Bank shall obtain any
payment (whether voluntary, involuntary, through the exercise of any right of
set-off, or otherwise) on account of the Advances made by it or the Purchased
Notes held for its benefit (other than pursuant to Section 3.06 or 3.07) in
excess of its ratable share of payments on account of the Advances or the
Purchased Notes obtained by all the Banks, such Bank shall forthwith purchase
from the other Banks such participations in the Advances made by them and the
Purchased Notes held for their benefit as shall be necessary to cause such
purchasing Bank to share the excess payment ratably with each of them; provided,
however, that if all or any portion of such excess payment is thereafter
recovered from such purchasing Bank, such purchase from each Bank shall be
rescinded and such Bank shall repay to the purchasing Bank the purchase price to
the extent of such recovery together with an amount equal to such Bank's ratable
share (according to the proportion of (i) the amount of such Bank's required
repayment to (ii) the total amount so recovered from the purchasing Bank) of any
interest or other amount paid or payable by the purchasing Bank in respect of
the total amount so recovered. The Company agrees that any Bank so purchasing a
participation from another Bank pursuant to this Section 3.10 may, to the
fullest extent permitted by law, exercise all its rights of payment (including
the right of set-off) with
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respect to such participation as fully as if such Bank were the direct creditor
of the Company in the amount of such participation.
SECTION 3.11. FUNDING INDEMNITY. The Company agrees to indemnify and
hold harmless the Administrative Agent and the Banks from any loss or expense
which they or any of them may sustain or incur as a result of:
(a) the repayment or prepayment of any Eurodollar Rate Advance in whole
or in part other than on the last day of the Interest Period applicable thereto;
or
(b) the failure of the Company to pay the principal of or interest on
any Advance when due (whether at stated maturity, upon acceleration or
otherwise); or
(c) the failure of the Company to Convert any Base Rate Advance on the
date specified for such Conversion in a notice delivered to the Administrative
Agent by the Company pursuant to Section 3.05(a);
including but not limited to any such loss or expense arising from interest,
fees or other amounts payable by the Administrative Agent or any of the Banks to
lenders of funds obtained by them in order to make and maintain the Advances
hereunder.
SECTION 3.12. ILLEGALITY. Notwithstanding any other provision of this
Agreement, if any Bank shall notify the Administrative Agent that the
introduction of or any change in or in the interpretation of any law or
regulation makes it unlawful, or any central bank or other governmental
authority asserts that it is unlawful, for any Bank or its Eurodollar Lending
Office to perform its obligations hereunder to make Eurodollar Rate Advances or
to fund or maintain Eurodollar Rate Advances hereunder, (i) all Eurodollar Rate
Advances shall be Converted into Base Rate Advances and (ii) the obligation of
the Banks to make, or to Convert Base Rate Advances into, Eurodollar Rate
Advances shall be suspended until the Administrative Agent shall notify the
Company and the Banks that the circumstances causing such suspension no longer
exist.
ARTICLE IV
CONDITIONS OF LENDING
SECTION 4.01. CONDITION PRECEDENT TO INITIAL ADVANCES. The obligation
of each Bank to make its initial Advance is subject to the condition precedent
that the Administrative Agent shall have received, on or before the date hereof,
the following, each dated such date (except as otherwise provided herein), in
form and substance satisfactory to the Administrative Agent and in sufficient
copies for each Bank:
(a) Counterparts of this Agreement, duly executed and delivered by the
Company, the Administrative Agent, the Banks listed on the signature pages
hereto and each Remarketing Agent.
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(b) Certified copies of the resolutions of the Board of Directors of
the Company approving the Related Documents, and of all documents evidencing
other necessary corporate action and governmental approvals, if any, with
respect to the Related Documents and the transactions contemplated thereby.
(c) A certificate of the Secretary or an Assistant Secretary of the
Company certifying the names and true signatures of the officers of the Company
authorized to sign each Related Document and the other documents to be delivered
hereunder.
(d) Copies of the Articles of Incorporation and by-laws of the Company,
together with all amendments thereto, certified by the Secretary or an Assistant
Secretary of the Company.
(e) An executed copy (or a duplicate copy thereof certified by the
Company in a manner satisfactory to the Administrative Agent to be a true and
correct copy) of the Remarketing Agreement, duly executed by the Company and
each Remarketing Agent.
(f) An executed copy (or a duplicate copy thereof certified by the
Company in a manner satisfactory to the Administrative Agent to be a true and
correct copy) of the Note Indenture (including the Second Supplemental
Indenture, dated as of September 15, 1993, as amended by the First Amendment to
the Second Supplemental Indenture, dated as of August 15, 1996), duly executed
by the Company and the trustee thereunder.
(g) An executed copy (or a duplicate copy thereof certified by the
Company in a manner satisfactory to the Administrative Agent to be a true and
correct copy) of the Mortgage (including the Supplemental Indenture dated as of
September 15, 1993 thereto), duly executed by the Company and the trustee
thereunder.
(h) A certified copy of the order of the Michigan Public Service
Commission (the "MPSC ORDER") authorizing the issuance and sale of the Notes and
the issuance and sale of the general and refunding mortgage bond under the
Mortgage as security for the obligations of the Company under the Indenture.
(i) A favorable opinion of the Company's General Counsel, substantially
in the form of Exhibit C hereto and as to such other matters as any Bank through
the Administrative Agent may reasonably request.
(j) Copies of the Prospectus used in connection with the offering and
remarketing of the Notes as in effect on such date, including any amendments or
supplements thereto.
(k) Such other approvals, opinions and documents as the Majority Banks,
through the Administrative Agent, may reasonably request as to the legality,
validity, binding effect or enforceability of this Agreement or any Related
Document or the financial condition, properties, operations or prospects of the
Company.
SECTION 4.02. CONDITIONS PRECEDENT TO EACH BORROWING AND CONVERSION.
The obligation of each Bank to make an Advance on the occasion of each Borrowing
(including the initial Borrowing), and the obligation of each Bank to make each
Conversion on the occasion
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thereof, shall be subject to the further conditions precedent that on the date
of such Borrowing or Conversion:
(a) the following statements shall be true (and each of the giving of
the applicable Notice of Failed Remarketing and Borrowing Request and the making
of such Advance, or the making of such Conversion, without prior correction by
the Company, shall constitute a representation and warranty by the Company that,
on the date of such Borrowing or Conversion, such statements are true):
(i) The representations and warranties contained in Section 5.01
of this Agreement (excluding subsections (f) and (h) thereof) are
correct on and as of the date of such Borrowing or Conversion, as the
case may be, before and after giving effect to such Borrowing and the
application of the proceeds therefrom, or to such Conversion, as the
case may be, as though made on and as of such date, and
(ii) No event has occurred and is continuing, or would result from
such Borrowing or from the application of the proceeds therefrom, or
from such Conversion, as the case may be, which constitutes an Event of
Default or would constitute an Event of Default but for the requirement
that notice be given or time elapse or both;
(b) the Administrative Agent shall have received a Notice of Failed
Remarketing and Borrowing Request, signed by a duly authorized officer of the
applicable Remarketing Agent, dated the date of such Borrowing, or the
appropriate notice of Conversion delivered by the Company pursuant to Section
3.05(a), with respect to such Conversion; and
(c) the Administrative Agent shall have received such other approvals,
opinions or documents relating to the satisfaction of foregoing conditions as
any Bank through the Administrative Agent may reasonably request.
ARTICLE V
REPRESENTATIONS AND WARRANTIES
SECTION 5.01. REPRESENTATIONS AND WARRANTIES OF THE COMPANY. The
Company represents and warrants as follows:
(a) The Company is a corporation duly formed, validly existing and in
good standing under the laws of the State of Michigan. There is no other
jurisdiction where the conduct of its business or the ownership of its Property
requires the Company to qualify to do business. The Company has all requisite
power and authority to conduct its business, to own its Properties, and to
execute and deliver and perform all of its obligations under this Agreement and
each of the other Related Documents to which it is a party.
(b) The execution, delivery and performance by the Company of this
Agreement and the other Related Documents to which it is a party have been duly
authorized by all necessary corporate action, and do not, and will not,
contravene (i) any provision of the charter or by-laws
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of the Company, (ii) law, or (iii) any contractual restriction binding on or
affecting the Company, and do not result in or require the creation of any Lien
(except pursuant to, or as contemplated by, this Agreement, the Note Indenture
or the Mortgage) upon or with respect to any of its Properties.
(c) No authorization or approval or other action by, and no notice to
or filing with, any Governmental Authority is required for the due execution,
delivery and performance by the Company of this Agreement or any other Related
Document to which the Company is a party, except the MPSC Order, which has been
duly obtained and is in full force and effect, and such other authorizations,
approvals, actions and notices as have been duly obtained or made and are in
full force and effect.
(d) This Agreement is, and each of the other Related Documents to which
the Company is a party when delivered hereunder will be, legal, valid and
binding obligations of the Company enforceable against the Company in accordance
with their respective terms.
(e) Except and to the extent specifically described in written reports,
copies of which have been furnished to the Banks, there is no pending or
threatened action, investigation or proceeding before any court, governmental
agency or arbitrator against or affecting the Company that would, if adversely
determined, have a material adverse effect on the financial condition or
operations of the Company or the ability of the Company to perform its
obligations hereunder or under any of the other Related Documents to which it
is, or is to be, a party, or that purports to affect the legality, validity or
enforceability of this Agreement or any other Related Document.
(f) The information provided by the Company about itself and under the
heading "The Company" in the Prospectus (the "COMPANY INFORMATION") was accurate
on and as of the date of the Prospectus in all material respects for the
purposes for which its use was authorized. The Company Information in the
Prospectus does not contain any untrue statement of a material fact or omit to
state any material fact necessary to make the statements made therein, in the
light of the circumstances under which they are or were made and as of the date
of the Prospectus, not misleading.
(g) The Company has filed all income tax returns and all other material
tax returns that are required to be filed by it and has paid all taxes due
pursuant to such returns or pursuant to any assessments received by it. The
charges, accruals and reserves on the books of the Company in respect of taxes
or other governmental charges are adequate in accordance with generally accepted
accounting principles.
(h) The balance sheet of the Company as of December 31, 1998, and the
related statements of income and cash flows of the Company for the Fiscal Year
then ended, and the balance sheet of the Company as of June 30, 1999, and the
related statements of income and cash flows of the Company for the three months
then ended, copies of which have been furnished to the Administrative Agent for
each Bank, fairly represent, subject, in the case of said balance sheet as at
June 30, 1999, and of said statements of income and cash flows for the three
months then ended, to year-end audit adjustments, the financial condition of the
Company as of such dates and the periods ended on such dates, all in accordance
with generally accepted accounting principles
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consistently applied, and there has been no material adverse change in such
condition or operations since June 30, 1999, except such as may have occurred in
the ordinary course of business. The Company has no material liability,
contingent or otherwise, including material liabilities for taxes, for which it
has not provided adequate reserves in accordance with generally accepted
accounting principles.
(i) The Company has good and marketable title to all of its Property
reflected on the balance sheet of the Company as of June 30, 1999, as being
owned by the Company, except for (A) such Property as has been disposed of in
the ordinary course of business, (B) pollution control facilities being
purchased by the Company under installment sales contracts and the undivided
ownership interest of the Michigan Public Power Agency in a portion of the Belle
River Power Plant, and (C) minor exceptions and minor defects, irregularities
and deficiencies that do not materially impair the use of such Property for the
purpose for which it is held by the Company.
(j) The Company is not in default under (and no event has occurred that
with the lapse of time or notice or action by a third party could result in a
default under) any instrument evidencing any Debt or under any agreement
relating thereto, or any indenture, mortgage, deed of trust, security agreement,
lease, franchise or other agreement or other instrument to which the Company is
a party or by which the Company or any of its Property is subject to or bound.
(k) The Company is not in violation of any Legal Requirements to which
the Company is subject, nor has the Company failed to obtain any licenses,
permits, franchises, or other governmental authorizations necessary to the
ownership of its Property or to the conduct of its business, which violation or
failure to obtain materially adversely affects the business, prospects, profits,
Property or condition (financial or otherwise) of the Company.
(l) The material Property used or to be used in the continuing
operations of the Company is in good repair, working order and condition as is
customary for a public utility.
(m) The Company is not an "investment company", or a company
"controlled" by an "investment company" (within the meaning of the Investment
Company Act of 1940, as amended). The Company is not a "holding company" but is
an "affiliate" of a "holding company" (within the meaning of the Public Utility
Holding Company Act of 1935, as amended ("PUHCA")), which holding company is
exempt from the provisions of PUHCA, other than Section 9(a)(2) thereof,
pursuant to Section 3(a)(1) thereof.
(n) No Plan Termination Event has occurred with respect to any Plan or
Multiple Employer Plan. Each Plan established or maintained by the Company and
its ERISA Affiliates is in compliance with all applicable provisions of ERISA,
and the Company and all of its ERISA Affiliates have filed all reports required
by ERISA and the Code to be filed with respect to each Plan. The Company has no
knowledge of any event that could result in a liability of the Company or its
ERISA Affiliates to the PBGC, whether under a Plan, a Multiemployer Plan, or
otherwise. The Company and all of its ERISA Affiliates have met all requirements
with respect to funding the Plans imposed by ERISA or the Code. There have not
been any nor are there now existing any events or conditions that would permit
any Plan to be terminated under circumstances that would cause the lien provided
under Section 4068 of ERISA to attach to the Property of the
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Company or its ERISA Affiliates. The value of the Plans' benefits guaranteed
under Title IV of ERISA on the date hereof does not exceed the value of such
Plans' assets allocable to such benefits as of the date of this Agreement. No
"Prohibited Transaction" within the meaning of Section 406 of the Pension Reform
Act, as amended, exists or will exist upon the execution and delivery of this
Agreement or any Related Document.
(o) The Company carries insurance with reputable insurers or self
insurance, as is customary, in respect of its Property.
(p) In addition to the representations and warranties contained in this
Article V, all statements contained in any other Related Document or in any
agreement, document, instrument or certificate delivered by or on behalf of the
Company in connection with the transactions contemplated hereby and thereby
shall constitute representations and warranties made by the Company hereunder.
All representations and warranties made by or on behalf of the Company herein
shall survive the delivery of this Agreement, and any investigation at any time
made by or on behalf of the Administrative Agent or any Bank shall not diminish
its rights to rely thereon.
(q) No part of the proceeds of the Advances or the Notes will be used
directly or indirectly for the purpose of purchasing or carrying, or for payment
in full or in part of Debt that was incurred for the purposes of purchasing or
carrying, any margin stock (within the meaning of Regulation U issued by the
Board of Governors of the Federal Reserve System), or to extend credit to others
for the purpose of purchasing or carrying any margin stock.
(r) The Company is in substantial compliance with all Environmental
Laws and no material Environmental Event has occurred.
ARTICLE VI
COVENANTS OF THE COMPANY
SECTION 6.01. AFFIRMATIVE COVENANTS. So long as the Banks shall have
any Commitment under this Agreement, or the Company shall have an obligation to
pay any amount to any Bank hereunder or under any Purchased Note, the Company
will, unless the Majority Banks shall otherwise consent in writing:
(a) PRESERVATION OF CORPORATE EXISTENCE, ETC. Preserve and maintain its
corporate existence and all rights, privileges and franchises necessary and
desirable in the normal conduct of its business and in the performance of its
obligations under the Related Documents and not dissolve or otherwise
discontinue its existence or operations.
(b) COMPLIANCE WITH LAWS, ETC. Comply with all Legal Requirements
applicable to the Company and its Property.
(c) PAYMENT OF TAXES, ETC. Pay and discharge before the same shall
become delinquent (i) all taxes, assessments and governmental charges or levies
imposed upon it or upon its Property and (ii) all lawful claims that, if unpaid,
might by law become a lien upon the
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Company's Property; provided, however, that the Company shall not be required to
pay and discharge or cause to be paid and discharged any such tax, assessment,
governmental charge, or claim to the extent that the amount, applicability, or
validity thereof shall currently be contested in good faith by appropriate
proceedings, so long as no tax sale can occur during such proceedings and the
Company shall have established and shall maintain adequate reserves on its books
for the payment of such amounts.
(d) VISITATION RIGHTS. At any reasonable time and from time to time,
upon reasonable notice, permit the Administrative Agent or any agents or
representatives thereof to examine and make copies of and abstracts from the
records and books of account of, and visit the Properties of, the Company and to
discuss the affairs, finances and accounts of the Company with any of its
officers.
(e) KEEPING OF BOOKS. Keep proper books of record and account, in which
full and correct entries shall be made of all financial transactions and the
assets and business of the Company in accordance with generally accepted
accounting principles consistently applied.
(f) MAINTENANCE OF PROPERTIES, ETC. Maintain and preserve all of its
Properties that are used or useful in the conduct of its business in good
working order and condition, ordinary wear and tear excepted.
(g) MAINTENANCE OF INSURANCE. Maintain insurance with responsible and
reputable insurance carriers, or self-insurance as is customary, in such amounts
and covering such risks as is usually carried by companies engaged in similar
businesses and owning similar Properties in the same general areas in which the
Company operates.
(h) PERFORMANCE AND COMPLIANCE WITH OTHER COVENANTS. Perform and comply
in all material respects with each of the covenants binding on the Company set
forth in the Note Indenture and the other Related Documents, as in effect on the
date hereof, or as such covenants may hereafter be amended or supplemented in
accordance with the terms of this Agreement or such Related Document.
(i) REPORTING REQUIREMENTS. Furnish to the Administrative Agent, with
sufficient copies for each of the Banks, the following:
(i) as soon as possible and in any event within five days after
the Company knows or has reason to know of the occurrence of an Event
of Default or an event that, with the giving of notice or time lapse,
or both, would constitute an Event of Default continuing on the date of
such statement, an Officer's Certificate of the Company setting forth
details of such Event of Default or event and the action that the
Company proposes to take with respect thereto;
(ii) as soon as possible and in any event within five days after
the Company knows or has reason to know of the occurrence of any
material adverse change in the financial condition or operations of the
Company, an Officer's Certificate of the Company setting forth details
of such material adverse change and the action that the Company
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proposes to take with respect thereto;
(iii) to the extent not otherwise to be disclosed by the Company
in a report on Form 10-K, Form 10-Q or Form 8-K to be filed with the
Securities and Exchange Commission, promptly after the commencement
thereof, notice of all actions, suits and proceedings against the
Company before any court or governmental department, commission, board,
bureau, agency or instrumentality, domestic or foreign, affecting the
Company that may materially adversely affect the financial condition or
operations or prospects of the Company;
(iv) as soon as available and in any event within 45 days after
the end of each of the first three quarters of each Fiscal Year of the
Company, financial statements of the Company as of the end of such
quarter consisting of a balance sheet and the related statements of
income and changes in cash flow of the Company (or consisting of such
other financial information as is customary at the time of preparation
of such financial statements) for the portion of the Fiscal Year ended
at the end of such quarter, setting forth in the case of statements of
income and cash flows in comparative form the figures for the
corresponding quarter of the previous Fiscal Year, and, in the event
such financial statements have not been prepared in accordance with
generally accepted accounting principles consistently applied, such
financial statements shall be accompanied by a statement of a
responsible officer of the Company as to the reasons therefor; and if
an Event of Default or event that with notice or lapse of time, or
both, would constitute an Event of Default has occurred during such
quarter and is continuing, such financial statements shall be
accompanied by an Officer's Certificate of the Company containing a
statement as to the nature thereof and the action that the Company
proposes to take with respect thereto;
(v) as soon as available, and in any event within 90 days after
the end of each Fiscal Year, a copy of the annual report for such year,
including therein balance sheets of the Company as at the end of such
Fiscal Year, an income statement, and a cash flow statement (or
consisting of such other financial information as is customary at the
time of preparation of such financial statements) for such Fiscal Year,
setting forth in each case in comparative form the figures for the
previous year, in each case certified by independent accountants of
recognized standing, and if an Event of Default or an event that, with
notice or lapse of time or both, would constitute an Event of Default,
has occurred and is continuing, such annual report shall be accompanied
by an Officer's Certificate of the Company as to the nature thereof and
detailing the actions the Company proposes to take with respect
thereto;
(vi) to the extent not otherwise to be disclosed by the Company in
a report on Form 10-K, Form 10-Q or Form 8-K to be filed with the
Securities and Exchange Commission, as soon as possible and in any
event within five days after occurrence of any material Environmental
Event, an Officer's Certificate of the Company setting forth the
details of such material Environmental Event and the action that the
Company proposes to take with respect thereto;
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(vii) to the extent not otherwise to be disclosed by the Company
in a report on Form 10-K, Form 10-Q or Form 8-K to be filed with the
Securities and Exchange Commission, promptly upon becoming aware
thereof, notice of any Plan Termination Event or any event or action
that could result in the Company's or an ERISA Affiliate's complete
withdrawal, partial withdrawal or secondary liability for withdrawal
liability payments with respect to a Multiemployer Plan or a Multiple
Employer Plan, together with an Officer's Certificate of the Company
describing the event or the action taken and the reasons therefor;
(viii) promptly after the sending or filing thereof, copies of all
material reports that the Company sends to its securityholders, and
copies of all reports on Form 10-K, Form 10-Q or Form 8-K that the
Company files with the Securities and Exchange Commission; and
(ix) such other information regarding the business, Property or
the condition or operations, financial or otherwise, of the Company as
the Administrative Agent may from time to time reasonably request.
(j) MAINTENANCE OF STATUS. Maintain its status as a public utility
regulated by the Michigan Public Service Commission and the Federal Energy
Regulatory Commission.
(k) ERISA. Maintain, and cause each of its ERISA Affiliates to
maintain, Plan assets that are at least equal in value to Plan benefits
guaranteed under Title IV of ERISA, and not permit any "Prohibited Transaction"
within the meaning of Section 406 of ERISA to exist.
(l) FURTHER ASSURANCES. Execute and deliver, or cause to be executed
and delivered, to the Administrative Agent from time to time, promptly upon
request therefor, any and all other and further instruments, and take all
further action, that may be necessary or that any Bank through the
Administrative Agent may reasonably request, in order to cure any deficiency in
the execution and delivery of, and to give full effect to, this Agreement or any
Related Document to which it is a party, or to describe more fully particular
aspects of any of the Company's agreements and undertakings provided in this
Agreement or so intended to be. In addition, the Company will use all reasonable
efforts to duly fulfill all Legal Requirements from time to time on or prior to
such date as the same may become legally required.
(m) USE OF PROCEEDS. Use the proceeds of all Advances solely for the
purchase of Unremarketed Notes pursuant to the terms and conditions of this
Agreement and the other Related Documents.
(n) NOTIFICATION OF AMENDMENTS. Notify the Administrative Agent of any
proposed amendment to or modification of any Related Document prior to the
effective date of such amendment or modification.
(o) REMARKETING IN ACCORDANCE WITH APPLICABLE SECURITIES LAWS. In the
event that the Company at any time shall remarket Purchased Notes purchased from
the Banks pursuant to Section 2.06 of this Agreement, such remarketing shall be
in full compliance with all applicable
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Securities Laws.
SECTION 6.02. NEGATIVE COVENANTS. So long as the Banks shall have any
Commitment under this Agreement, or the Company shall have any obligation to pay
any amount to any Bank hereunder or under any Purchased Note, the Company will
not, without the prior written consent of the Majority Banks:
(a) AMENDMENT OF NOTE INDENTURE OR LIQUIDITY PROVIDER NOTE. Enter into
or consent to any amendment to or modification of the Note Indenture, as in
effect on the date hereof, which amendment to or modification of the Note
Indenture affects the form of Liquidity Provider Note attached as an exhibit to
the Note Indenture or requires the consent of all Beneficial Owners.
(b) MERGER, CONSOLIDATION OR SALE OF ASSETS. Dissolve, sell or
otherwise dispose of all or substantially all of its assets or consolidate with,
or merge into, another corporation or permit one or more other corporations to
consolidate with or merge into it; provided, however, that the Company may merge
into, or consolidate with or transfer or otherwise dispose of substantially all
of its assets to any other Person and any Person may merge into, or consolidate
with, the Company provided in each case that (i) the Company has given the
Administrative Agent prior written notice of its intention to consummate such a
transaction setting forth the details thereof, (ii) immediately after giving
effect thereto (A) no event shall occur and be continuing which constitutes an
Event of Default or would, with the passage of time or giving of notice, or
both, constitute an Event of Default and (B) the entity formed by or resulting
from such consolidation shall have a Consolidated Net Worth at least equal to
that of the Company prior to any such merger or consolidation and there
otherwise shall have been no material adverse change in the consolidated
financial position of the Company, (iii) the entity formed by any such
consolidation or into which the Company shall be merged, or to which the
Company's assets shall be transferred shall assume in a writing satisfactory to
the Majority Banks the Company's obligations under this Agreement and the
Related Documents to which the Company is a party, and (iv) in all cases the
surviving entity or entity formed by such consolidation, or the entity to which
assets shall be transferred, shall be a public utility regulated by a state
Public Service Commission or the Federal Energy Regulatory Commission.
(c) ALTERNATE CREDIT FACILITY. Cause a substitute credit facility to be
established for the Company without payment in full to the Banks of all
obligations hereunder through and including the Termination Date.
ARTICLE VII
EVENTS OF DEFAULT
SECTION 7.01. EVENTS OF DEFAULT. The occurrence of any of the following
events shall be an "EVENT OF DEFAULT" hereunder:
(a) The Company shall fail to pay any amount payable hereunder or under
any of the
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other Related Documents on the date when due or shall fail to perform or observe
any of the covenants and agreements contained in Section 6.01(i)(i) or Section
6.02; or
(b) Any representation or warranty made or deemed made by the Company
(or any of its officers) herein or by the Company (or any of its officers) in
connection with this Agreement or any of the other Related Documents shall prove
to have been incorrect in any material respect when made or deemed made; or
(c) The Company shall fail to perform or observe any other term,
covenant or agreement (other than a term, covenant, or agreement whose
performance or observance is dealt with specifically elsewhere in this Section
7.01) contained in this Agreement on its part to be performed or observed and
any such failure shall remain unremedied for 30 days after written notice
thereof by the Administrative Agent to the Company; or
(d) (i) The Company shall fail to pay any Debt in excess of an
aggregate amount of $10,000,000 (excluding Debt under this Agreement), or any
interest or premium thereon, when due (whether by scheduled maturity, required
prepayment, acceleration, demand or otherwise), and such failure shall continue
after the applicable grace period, if any, specified in the agreement or
instrument relating to such Debt, (ii) the Company shall fail to perform any
term, covenant, agreement or condition on its part to be performed or observed
under any agreement or instrument relating to any such Debt when required to be
performed or observed, and such failure shall continue after the applicable
grace period, if any, specified in the agreement or instrument relating to such
Debt, or (iii) any such Debt shall be accelerated or declared to be due and
payable, or required to be prepaid (other than by a regularly scheduled required
prepayment), prior to the stated maturity thereof; or
(e) The Company shall admit in writing its inability to pay its debts
generally, or shall make a general assignment for the benefit of creditors; or
any proceeding shall be instituted by or against the Company seeking to
adjudicate it a bankrupt or insolvent, or seeking liquidation, winding up,
reorganization, arrangement, adjustment, protection, relief, or composition of
it or its debts under any law relating to bankruptcy, insolvency or
reorganization or relief of debtors, or seeking the entry of an order for relief
or the appointment of a receiver, trustee, or other similar official for it or
any substantial part of its Property and, if instituted against the Company
shall remain undismissed for a period of 30 days or an "order for relief" as
defined in the United States Bankruptcy Reform Act of 1978, as amended (the
"FEDERAL BANKRUPTCY CODE"), shall be rendered prior to the expiration of that
30-day period; or any judgment, writ, warrant of attachment or execution or
similar process shall be issued or levied against any substantial part of the
Property of the Company and shall not be released, vacated or fully bonded
within ten Business Days after its issue or levy, or the Company shall take any
action to authorize any of the actions set forth above in this subsection (e);
or
(f) One or more judgments, decrees or orders for the payment of money
the enforcement of which, in the aggregate, would have a material adverse effect
on the financial condition, results of operations, operations, Property or
prospects of the Company, shall be rendered against the Company, and either (i)
enforcement proceedings shall have been commenced by any creditor upon any such
judgment, decree or order, or (ii) there shall be any
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period of 30 consecutive days during which a stay of enforcement of any such
judgment, decree or order, by reason of a pending appeal or otherwise, shall not
be in effect; or
(g) Any Plan Termination Event with respect to a Plan that the
Administrative Agent determines in good faith might constitute grounds for the
termination of any Plan or for the appointment of a trustee to administer any
Plan shall have occurred, and, 10 days after notice thereof shall have been
given by the Administrative Agent to the Company, (i) such Plan Termination
Event (if correctable) shall not have been corrected, and (ii) the then present
value of such Plan's vested benefits exceeds the then current value of assets
accumulated in such Plan by an amount which the Administrative Agent determines
in good faith could have a material adverse effect on the financial condition or
operations of the Company; or
(h) The Company or any ERISA Affiliate shall receive a notice of
liability or demand for payment with respect to a Multiemployer Plan or a
Multiple Employer Plan that the Administrative Agent determines in good faith
could have a material adverse effect on the financial condition or operations of
such Person; or
(i) An Environmental Event shall have occurred that materially
adversely affects the financial condition, business or operations of the
Company; or
(j) Any provision of this Agreement shall at any time for any reason
cease to be valid and binding on the Company, or shall be declared to be null
and void, or the validity or enforceability thereof shall be contested by the
Company, or a proceeding shall be commenced by any Governmental Authority
seeking to establish the invalidity or unenforceability thereof, or the Company
shall deny that it has any or further liability or obligation under this
Agreement; or
(k) Any "Event of Default", however defined, under the Note Indenture
or any other Related Document shall have occurred and be continuing; or
(l) Any other Related Document shall for any reason cease to be in full
force and effect; or
(m) The security interest in and lien created under the Note Indenture
on the general and refunding mortgage bond issued as security for the Notes
under the Mortgage shall cease to be a valid and perfected first priority
security interest and lien and such cessation shall be deemed to be material by
the Administrative Agent.
SECTION 7.02. UPON AN EVENT OF DEFAULT. If any Event of Default shall
have occurred and be continuing beyond any applicable grace period, the
Administrative Agent (i) shall at the request, or may with the consent, of the
Majority Banks, by notice to the Company, declare the obligation of each Bank to
make Advances to be terminated, whereupon the same shall forthwith terminate, or
(ii) if any Purchased Notes are at the time outstanding, shall at the request,
or may with the consent, of the Majority Banks, give notice to the Company that
all outstanding Purchased Notes are subject to immediate repurchase by the
Company pursuant to this Agreement, at a price equal to the sum of the unpaid
principal amount thereof plus all interest accrued and unpaid thereon, whereupon
the Company shall have an obligation, which obligation
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shall be immediately due and owing, absolutely and unconditionally, to effect
such repurchase by paying such price to the Administrative Agent, along with all
other amounts due and payable under this Agreement, in immediately available
funds, without presentment, demand, protest or further notice of any kind, all
of which are hereby expressly waived by the Company, and (iii) shall at the
request, or may with the consent, of the Majority Banks, by notice to the
Company, declare the outstanding principal amount of all other amounts owing or
to become owing under this Agreement to be forthwith due and payable, whereupon
all such amounts shall become and be forthwith due and payable, without
presentment, demand, protest or further notice of any kind, all of which are
hereby expressly waived by the Company; provided, however, that in the event of
an actual or deemed entry of an order for relief with respect to the Company or
any of its subsidiaries under the Federal Bankruptcy Code, (A) the obligation of
each Bank to make Advances shall automatically be terminated, (B) the Company
shall have an immediate obligation to purchase all outstanding Purchased Notes
at a price equal to the unpaid principal amount thereof plus all interest
accrued and unpaid thereon and (C) all amounts owing or to become owing
hereunder shall automatically become and be due and payable, without
presentment, demand, protest or any notice of any kind, all of which are hereby
expressly waived by the Company.
ARTICLE VIII
THE ADMINISTRATIVE AGENT
SECTION 8.01. AUTHORIZATION AND ACTION. Each Bank hereby appoints and
authorizes the Administrative Agent to take such action as agent on its behalf
and to exercise such powers under this Agreement as are delegated to the
Administrative Agent by the terms hereof, together with such powers as are
reasonably incidental thereto. As to any matters not expressly provided for by
this Agreement, the Administrative Agent shall not be required to exercise any
discretion or take any action, but shall be required to act or to refrain from
acting (and shall be fully protected in so acting or refraining from acting)
upon the instructions of the Majority Banks and such instructions shall be
binding upon all Banks and all holders of Purchased Notes; provided, however,
that the Administrative Agent shall not be required to take any action which
exposes the Administrative Agent to personal liability or which is contrary to
this Agreement or applicable law. The Administrative Agent agrees to give to
each Bank prompt notice of each notice given to it by the Company pursuant to
the terms of this Agreement. In performing its functions and duties under this
Agreement, the Administrative Agent shall act solely as agent of the Banks and
does not assume and shall not be deemed to have assumed any obligation towards
or relationship of agency or trust with or for the Company.
SECTION 8.02. ADMINISTRATIVE AGENT'S RELIANCE, ETC. Neither the
Administrative Agent nor any of its directors, officers, agents or employees
shall be liable for any action taken or omitted to be taken by it or them under
or in connection with this Agreement, except for its or their own gross
negligence or willful misconduct. Without limitation of the generality of the
foregoing, the Administrative Agent: (i) may consult with legal counsel
(including counsel for the Company), independent public accountants and other
experts selected by it and shall not be liable for any action taken or omitted
to be taken in good faith by it in accordance with the advice of such counsel,
accountants or experts; (ii) makes no warranty or representation to any Bank and
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shall not be responsible to any Bank for any statements, warranties or
representations (whether written or oral) made in or in connection with this
Agreement; (iii) shall not have any duty to ascertain or to inquire as to the
performance or observance of any of the terms, covenants or conditions of this
Agreement on the part of the Company or to inspect the property (including the
books and records) of the Company; (iv) shall not be responsible to any Bank for
the due execution, legality, validity, enforceability, genuineness, sufficiency
or value of this Agreement or any other instrument or document furnished
pursuant hereto; and (v) shall incur no liability under or in respect of this
Agreement by acting upon any notice, consent, certificate or other instrument or
writing (which may be by telecopier, telegram, cable or telex) believed by it to
be genuine and signed or sent by the proper party or parties.
SECTION 8.03. BARCLAYS BANK PLC AND AFFILIATES. With respect to its
Commitment, the Advances made by it and the Purchased Notes held for its
benefit, Barclays Bank PLC shall have the same rights and powers under this
Agreement as any other Bank and may exercise the same as though it were not the
Administrative Agent; and the terms Bank and Banks shall, unless otherwise
expressly indicated, include Barclays Bank PLC in its individual capacity.
Barclays Bank PLC and its affiliates may accept deposits from, lend money to,
act as trustee under indentures of, and generally engage in any kind of business
with, the Company, any of its subsidiaries and any Person who may do business
with or own securities of the Company, or any such subsidiary, all as if
Barclays Bank PLC were not the Administrative Agent and without any duty to
account therefor to the Banks.
SECTION 8.04. BANK CREDIT DECISION. Each Bank acknowledges that it has,
independently and without reliance upon the Administrative Agent or any other
Bank and based on the financial statements referred to in Section 5.01 and such
other documents and information as it has deemed appropriate, made its own
credit analysis and decision to enter into this Agreement. Each Bank also
acknowledges that it will, independently and without reliance upon the
Administrative Agent or any other Bank and based on such documents and
information as it shall deem appropriate at the time, continue to make its own
credit decisions in taking or not taking action under this Agreement.
SECTION 8.05. INDEMNIFICATION. The Banks agree to indemnify the
Administrative Agent (to the extent not reimbursed by the Company), ratably
according to the respective amounts of their Commitments, from and against any
and all liabilities, obligations, losses, damages, penalties, actions,
judgments, suits, costs, expenses or disbursements of any kind or nature
whatsoever which may be imposed on, incurred by, or asserted against the
Administrative Agent in any way relating to or arising out of this Agreement or
any action taken or omitted by the Administrative Agent under this Agreement;
provided, that no Bank shall be liable for any portion of such liabilities,
obligations, losses, damages, penalties, actions, judgments, suits, costs,
expenses or disbursements resulting from the Administrative Agent's gross
negligence or willful misconduct. Without limitation of the foregoing, each Bank
agrees to reimburse the Administrative Agent promptly upon demand for its
ratable share of any out-of-pocket expenses (including counsel fees) incurred by
the Administrative Agent in connection with the preparation, execution,
delivery, administration, modification, amendment or enforcement (whether
through negotiations, legal proceedings or otherwise) of, or legal advice in
respect of rights or responsibilities under, this Agreement, to the extent that
the Administrative Agent is not
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reimbursed for such expenses by the Company.
SECTION 8.06. Successor Agent.
(a) The Administrative Agent may resign at any time by giving written
notice thereof to the Banks and the Company and may be removed at any time with
cause by the Majority Banks. Upon any such resignation or removal, the Majority
Banks shall have the right to appoint a successor Administrative Agent. If no
successor Administrative Agent shall have been so appointed by the Majority
Banks, and shall have accepted such appointment, within 30 days after the
retiring Administrative Agent's giving of notice of resignation or the Majority
Banks' removal of the retiring Administrative Agent, then the retiring
Administrative Agent may, on behalf of the Banks, appoint a successor
Administrative Agent, which shall be a commercial bank organized under the laws
of the United States of America or of any State thereof and having a combined
capital and surplus of at least $250,000,000.
(b) So long as no Event of Default, or event which, with the giving of
notice or the passage of time, or both, would constitute an Event of Default,
shall have occurred and be continuing, the Company may at any time remove the
Administrative Agent with or without cause; provided that prior to such removal
a Bank acceptable to the Majority Banks shall have agreed to accept the
Company's appointment as successor Administrative Agent hereunder.
(c) Upon the acceptance of any appointment as Administrative Agent
hereunder by a successor Administrative Agent, such successor Administrative
Agent shall thereupon succeed to and become vested with all the rights, powers,
privileges and duties of the retiring Administrative Agent, and the retiring
Administrative Agent shall be discharged from its duties and obligations under
this Agreement. After any retiring Administrative Agent's resignation or removal
hereunder as Administrative Agent, the provisions of this Article VIII shall
inure to its benefit as to any actions taken or omitted to be taken by it while
it was Administrative Agent under this Agreement.
ARTICLE IX
MISCELLANEOUS
SECTION 9.01. Amendments, Etc.
(a) No amendment or waiver of any provision of this Agreement, nor
consent to any departure by the Company therefrom, shall in any event be
effective unless the same shall be in writing and signed by the Majority Banks,
and then such waiver or consent shall be effective only in the specific instance
and for the specific purpose for which given; provided, however, that no
amendment, waiver or consent shall, unless in writing and signed by all the
Banks, do any of the following: (i) waive or modify any of the conditions
specified in Article IV, (ii) increase the Commitments of the Banks or subject
the Banks to any additional obligations, (iii) reduce the principal of, or
interest on, the Advances, the Purchased Notes or any fees or other amounts
payable hereunder, (iv) postpone any date fixed for any payment of principal of,
or interest on, the
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36
Advances, the Purchased Notes or any fees or other amounts payable hereunder,
(v) change the percentage of the Commitments or of the aggregate unpaid
principal amount of the Advances, the Purchased Notes, or the number of Banks,
which shall be required for the Banks or any of them to take any action
hereunder, (vi) amend this Section 9.01 or (vii) release any collateral securing
the Purchased Notes or change any provision of the Note Indenture providing for
the release of any collateral securing the obligations of the Company
thereunder; and provided, further, that no amendment, waiver or consent shall,
unless in writing and signed by the Administrative Agent in addition to the
Banks required above to take such action, affect the rights or duties of the
Administrative Agent under this Agreement or with respect to any Purchased Note.
(b) No amendment or waiver of any provision of this Agreement affecting
the rights or duties of any Remarketing Agent, nor consent to any departure by
any party therefrom, shall in any event be effective unless the same shall be in
writing and signed by such Remarketing Agent. Except as provided in the
preceding sentence, the consent of any Remarketing Agent shall not be required
for the amendment or waiver of, or consent to departure from, any provision of
this Agreement.
SECTION 9.02. NOTICES, ETC. All notices and other communications
provided for hereunder shall be in writing (including telecopier, telegraphic,
telex or cable communication) and mailed, telecopied, telegraphed, telexed,
cabled or delivered, if to the Company, at its address at ▇▇▇▇ ▇▇▇ ▇▇▇▇▇▇, ▇▇▇
▇.▇.▇., ▇▇▇▇▇▇▇, ▇▇▇▇▇▇▇▇ ▇▇▇▇▇-▇▇▇▇, Attention: Assistant Treasurer-Banking; if
to any Bank, at its Domestic Lending Office specified opposite its name on
Schedule I hereto; and if to the Administrative Agent, at its address at ▇▇▇
▇▇▇▇▇▇▇▇, ▇▇▇ ▇▇▇▇, ▇▇▇ ▇▇▇▇ ▇▇▇▇▇, Attention: ▇▇▇▇▇▇ ▇▇▇▇▇▇ (Telecopy No.:
▇▇▇-▇▇▇-▇▇▇▇) (Telephone No.: ▇▇▇-▇▇▇-▇▇▇▇), or, as to each party, at such other
address as shall be designated by such party in a written notice to the other
parties. All such notices and communications shall, when mailed, telecopied,
telegraphed, telexed or cabled, be effective when deposited in the mails,
telecopied, delivered to the telegraph company, confirmed by telex answerback or
delivered to the cable company, respectively, except that notices and
communications to the Administrative Agent pursuant to Article II, III or VIII
shall not be effective until received by the Administrative Agent.
SECTION 9.03. NO WAIVER; REMEDIES. No failure on the part of any Bank
or the Administrative Agent to exercise, and no delay in exercising, any right
under any Related Document shall operate as a waiver thereof; nor shall any
single or partial exercise of any such right preclude any other or further
exercise thereof or the exercise of any other right. The remedies herein
provided are cumulative and not exclusive of any remedies provided by law.
SECTION 9.04. COSTS, EXPENSES, TAXES AND INDEMNIFICATION.
(a) The Company agrees to pay on demand all costs and expenses in
connection with the preparation, execution, delivery, administration,
modification and amendment of the Related Documents and the other documents to
be delivered under the Related Documents, including, without limitation, the
reasonable fees and out-of-pocket expenses of counsel for the Administrative
Agent with respect thereto and with respect to advising the Administrative Agent
as to its rights and responsibilities under the Related Documents. The Company
further agrees to pay on demand all costs and expenses, if any (including,
without limitation, reasonable counsel
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fees and expenses of each Bank, including the allocated costs of staff counsel),
in connection with the enforcement (whether through negotiations, legal
proceedings or otherwise) of the Related Documents and the other documents to be
delivered under the Related Documents, including, without limitation, reasonable
counsel fees and expenses in connection with the enforcement of rights under
this Section 9.04. In addition, the Company shall pay any and all stamp and
other taxes payable or determined to be payable in connection with the
execution, delivery, filing and recording of the Related Documents and the other
documents to be delivered under the Related Documents, and agrees to save the
Administrative Agent and each Bank harmless from and against any and all
liabilities with respect to or resulting from any delay in paying or omission to
pay such taxes.
(b) The Company hereby agrees to indemnify and hold the Administrative
Agent and the Banks and their respective officers, directors, employees,
professional advisors and affiliates (each, an "INDEMNIFIED PERSON") harmless
from and against any and all claims, damages, losses, liabilities, costs or
expenses (including reasonable attorney's fees and expenses, whether or not such
Indemnified Person is named as a party to any proceeding or investigation or is
otherwise subjected to judicial or legal process arising from any such
proceeding or investigation) which any of them may incur or which may be claimed
against any of them by any person or entity (except to the extent such claims,
damages, losses, liabilities, costs or expenses arise from the gross negligence
or willful misconduct of the Indemnified Person):
(i) by reason of or in connection with the execution, delivery or
performance of any of the Related Documents or any transaction
contemplated thereby, or the use by the Company or any Remarketing
Agent of the proceeds of any Advance; or
(ii) by reason of any inaccuracy or alleged inaccuracy in any
material respect, or any untrue statement or alleged untrue statement
of any material fact, contained in any registration statement relating
to the Notes or in the Prospectus relating to the Notes or any
amendment or supplement thereto, except to the extent contained in or
arising from information in the Prospectus relating to the Notes
supplied in writing by and describing the Administrative Agent or the
Banks.
(c) The Company's obligations under this Section 9.04 shall survive the
repayment of all amounts owing to the Administrative Agent and the Banks under
the Related Documents and the termination of the Commitments. If and to the
extent that the obligations of the Company under this Section 9.04 are
unenforceable for any reason, the Company agrees to make the maximum
contribution to the payment and satisfaction thereof which is permissible under
applicable law.
SECTION 9.05. RIGHT OF SET-OFF. Upon (i) the occurrence and during the
continuance of any Event of Default and (ii) the making of any request or the
granting of any consent specified by Section 7.02 to authorize the
Administrative Agent to demand a repurchase of Purchased Notes or to declare
Advances due and payable pursuant to the provisions of Section 7.02, each Bank
is hereby authorized at any time and from time to time, to the fullest extent
permitted by law, to set off and apply any and all deposits (general or special,
time or demand, provisional or final) at any time held and other indebtedness at
any time owing by such Bank to or for the credit or the
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account of the Company against any and all of the obligations of the Company now
or hereafter existing under any Related Document, whether or not such Bank shall
have made any demand under this Agreement and although such obligations may be
unmatured. Each Bank agrees promptly to notify the Company after any such
set-off and application made by such Bank, provided that the failure to give
such notice shall not affect the validity of such set-off and application. The
rights of each Bank under this Section 9.05 are in addition to other rights and
remedies (including, without limitation, other rights of set-off) which such
Bank may have.
SECTION 9.06. BINDING EFFECT; ASSIGNMENTS; PARTICIPATIONS.
(a) This Agreement shall become effective when it shall have been
executed by the Company, the Administrative Agent, the Banks and the Remarketing
Agents, and thereafter shall be binding upon and inure to the benefit of the
Company, the Administrative Agent, each Remarketing Agent and each Bank and
their respective successors and assigns, except that: (i) the Company shall not
have the right to assign its rights hereunder or any interest herein without the
prior written consent of the Banks, and (ii) the Banks shall not have the right
to assign or transfer any portion of their respective Commitments (except for
assignments or pledges to a Federal Reserve Bank) (A) without the prior written
consent of the Company (unless an Event of Default shall have occurred and be
continuing, in which event no such consent shall be required) and the
Administrative Agent, which consents shall not be unreasonably withheld, (B) to
any assignee Bank that is not an Eligible Bank and (C) unless the parties to
each such assignment shall execute and deliver to the Administrative Agent, for
its acceptance and recording, an Assignment and Acceptance substantially in the
form of Exhibit B, and a processing and recordation fee of $3,500 payable by the
assigning Bank and/or the assignee Bank (such processing and recordation fee not
to be payable by the Company under any circumstances).
(b) Each Bank may sell participations to one or more banks or other
entities in or to all or a portion of its rights and obligations under this
Agreement (including, without limitation, all or a portion of its Commitment,
the Advances owing to it and its beneficial interest in any Purchased Notes);
provided, however, that (i) such Bank's obligations under this Agreement
(including, without limitation, its Commitment) shall remain unchanged, (ii)
such Bank shall remain solely responsible to the other parties hereto for the
performance of such obligations, and (iii) the Company, the Administrative
Agent, the Remarketing Agents and the other Banks shall continue to deal solely
and directly with such Bank in connection with such Bank's rights and
obligations under this Agreement.
SECTION 9.07. ELIGIBLE BANK STATUS. Each Bank confirms that it
satisfies the requirements of an Eligible Bank on the date of this Agreement. If
at any time any Bank shall cease to satisfy the requirements of an Eligible
Bank, such Bank shall assign its Commitments to an Eligible Bank as promptly as
is practicable in compliance with terms and provisions of Section 9.06;
provided, however, that so long as any Bank satisfies the requirements set forth
in clause (i) of the definition of Eligible Bank and is in the process of
promptly (and in no event later than 10 Business Days following the date on
which such Bank ceased to satisfy the requirements of an Eligible Bank)
restoring its compliance with the other requirements for Eligible Bank status,
such Bank shall not be required to effect the assignment of its Commitments
otherwise required by this sentence.
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SECTION 9.08. Governing Law. This Agreement shall be governed by, and
construed in accordance with, the laws of the State of New York.
SECTION 9.09. Execution in Counterparts. This Agreement may be executed
in any number of counterparts and by different parties hereto in separate
counterparts, each of which when so executed shall be deemed to be an original
and all of which taken together shall constitute one and the same agreement.
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IN WITNESS WHEREOF, the parties hereto have caused this Agreement to be
executed by their respective officers thereunto duly authorized, as of the date
first above written.
THE DETROIT EDISON COMPANY
By
-----------------------------------
Name:
Title:
41
SCHEDULE I
THE DETROIT EDISON COMPANY
STANDBY NOTE PURCHASE
CREDIT FACILITY
Domestic Eurodollar
Name of Bank Lending Office Lending Office Commitment
------------ -------------- -------------- ----------
42
EXHIBIT A
NOTICE OF FAILED REMARKETING
AND BORROWING REQUEST
Barclays Bank PLC
as Administrative Agent
for the Banks parties
to the Standby Note Purchase
Credit Facility referred to below
▇▇▇ ▇▇▇▇▇▇▇▇
__▇▇ ▇▇▇▇▇
▇▇▇ ▇▇▇▇, ▇▇▇ ▇▇▇▇ ▇▇▇▇▇
Attention: _____________
[Date]
Gentlemen:
The undersigned, [▇▇▇▇▇▇ BROTHERS INC.] [BANC ONE CAPITAL MARKETS,
INC.] [BARCLAYS CAPITAL INC.] (the "REMARKETING AGENT"), refers to the Standby
Note Purchase Credit Facility, dated as of October 26, 1999 (the "AGREEMENT",
the terms defined therein being used herein as therein defined), among The
Detroit Edison Company (the "Company"), certain Banks parties thereto, Barclays
Bank PLC, as Administrative Agent for said Banks, the Remarketing Agent, [▇▇▇▇▇▇
BROTHERS INC.] [BANC ONE CAPITAL MARKETS, INC.] and [BARCLAYS CAPITAL INC.].
Pursuant to Section 2.03 of the Agreement, the Company has authorized the
Remarketing Agent to notify you in the event of any Failed Remarketing and to
request a Borrowing in connection therewith. The Remarketing Agent hereby
represents and warrants that (i) it is a Remarketing Agent under the Remarketing
Agreement on and as of the date hereof, (ii) the Remarketing Agreement is in
full force and effect on the date hereof, (iii) a Failed Remarketing has
occurred on the date hereof with respect to $________ in outstanding principal
amount of Unremarketed Notes tendered to the Remarketing Agent and (iv) the
Remarketing Agent has received adequate funds to pay all accrued and unpaid
interest, if any, with respect to such Unremarketed Notes, or has informed the
Company of the Company's obligation to pay such accrued and unpaid interest on
the date hereof. The Remarketing Agent hereby gives you notice, irrevocably,
pursuant to Section 3.01 of the Agreement, that it requests a Borrowing under
the Agreement in connection with the Failed Remarketing described herein, and in
that connection sets forth below the information relating to such Borrowing as
required by Section 3.01(a) of the Agreement.
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(A) The Business Day of the requested Borrowing is ____________, 19__;
and
(B) The aggregate amount of the requested Borrowing is $________.
Very truly yours,
[▇▇▇▇▇▇ BROTHERS INC.]
[BANC ONE CAPITAL MARKETS, INC.]
[BARCLAYS CAPITAL INC.]
By ___________________________________
Name:
Title:
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EXHIBIT B
ASSIGNMENT AND ACCEPTANCE
Reference is made to the Standby Note Purchase Credit Facility dated as
of October 26, 1999 (the "AGREEMENT") among The Detroit Edison Company, a
Michigan corporation (the "COMPANY"), the Banks (as defined in the Agreement),
Barclays Bank PLC, as Administrative Agent for the Banks (the "ADMINISTRATIVE
AGENT") and the Remarketing Agents named therein as parties thereto. Terms
defined in the Agreement are used herein with the same meaning.
_______________________ (the "ASSIGNOR") and _____________________ (the
"Assignee") agree as follows:
1. The Assignor hereby irrevocably sells and assigns to the Assignee
without recourse to the Assignor, and the Assignee hereby irrevocably purchases
and assumes from the Assignor without recourse to the Assignor, as of the
Effective Date as set forth in Schedule 1 hereto (the "EFFECTIVE DATE"), an
interest (the "ASSIGNED INTEREST") in and to the Assignor's rights and
obligations under the Agreement with respect to those credit facilities
contained in the Agreement as are set forth on Schedule 1 (individually, an
"ASSIGNED FACILITY"; collectively, the "ASSIGNED FACILITIES"), in a principal
amount and percentage for each Assigned Facility as set forth on Schedule 1.
2. The Assignor (i) makes no representation or warranty and assumes no
responsibility with respect to any statements, warranties or representations
made in or in connection with the Agreement, any other Related Document or any
other instrument or document furnished pursuant thereto, or the execution,
legality, validity, enforceability, genuineness, sufficiency or value of the
Agreement, any other Related Document or any other instrument or document
furnished pursuant thereto, other than that it has not created any adverse claim
upon the interest being assigned by it hereunder and that such interest is free
and clear of any such adverse claim; and (ii) makes no representation or
warranty and assumes no responsibility with respect to the financial condition
of the Company, any of its subsidiaries or any other obligation or the
performance or observance by the Company, any of its subsidiaries or any other
obligor of any of their respective obligations under the Agreement or any other
Related Document or any other instrument or document furnished pursuant hereto
or thereto.
3. The Assignee (i) represents and warrants that it is legally
authorized to enter into this Assignment and Acceptance; (ii) confirms that it
has received a copy of the Agreement, together with copies of the financial
statements referred to in Section 5.01(h) thereof, the financial statements
delivered pursuant to Section 6.01(i) thereof, if any, and such other documents
and information as it has deemed appropriate to make its own credit analysis and
decision to enter into this Assignment and Acceptance; (iii) agrees that it
will, independently and without reliance upon the Assignor, the Administrative
Agent or any other Bank and based on such documents and information as it shall
deem appropriate at the time, continue to make its own credit decisions in
taking or not taking action under the Agreement, the other Related Documents or
any other instrument or document furnished pursuant hereto or thereto; (iv)
confirms that it is an Eligible Bank; (v) appoints and authorizes the
Administrative Agent to take such action as agent on its
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45
behalf and to exercise such powers under the Agreement as are delegated
to the Administrative Agent by the terms thereof, together with such
powers as are reasonably incidental thereto; (vi) agrees that it will
perform in accordance with their terms all of the obligations which by
the terms of the Agreement are required to be performed by it as a
Bank; and (vii) specifies as its Domestic Lending Office and its
Eurodollar Lending Office the respective offices set forth beneath its
name on the signature pages hereof.
4. Following the execution of this Assignment and Acceptance, it will
be delivered to the Administrative Agent for acceptance and recording by the
Administrative Agent pursuant to Section 9.06 of the Agreement, effective as of
the Effective Date (which date shall not, unless otherwise agreed to by the
Administrative Agent, be earlier than five Business Days after the date of such
acceptance and recording by the Administrative Agent).
5. Upon such acceptance and recording, from and after the Effective
Date, the Administrative Agent shall make all payments in respect of the
Assigned Interest (including payments of principal, interest, fees and other
amounts) to the Assignee which accrue subsequent to the Effective Date. The
Assignor and Assignee shall make all appropriate adjustments in payments under
the Agreement for periods prior to the Effective Date directly between
themselves.
6. From and after the Effective Date, (i) the Assignee shall be a party
to the Agreement and, to the extent provided in this Assignment and Acceptance,
have the rights and obligations of a Bank thereunder and shall be bound by the
provisions thereof and (ii) the Assignor shall, to the extent provided in this
Assignment and Acceptance, relinquish its rights and be released from its
obligations under the Agreement.
7. This Assignment and Acceptance shall be governed by and construed in
accordance with the law of the State of New York.
8. This Assignment and Acceptance may be executed in any number of
counterparts, all of which taken together shall constitute one and the same
instrument and any of the parties hereto may execute this Assignment and
Acceptance by signing any such counterpart.
IN WITNESS WHEREOF, the parties hereto have caused this Assignment and
Acceptance to be executed as of the date first above written by their respective
duly authorized officers on Schedule 1 hereto.
[NAME OF ASSIGNOR]
By: ________________________________________
Name:
Title:
[NAME OF ASSIGNEE]
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By: ________________________________________
Name:
Title:
Domestic Lending Office:
[Address]
Eurodollar Lending Office:
[Address]
Accepted this ____ day
of _____________, ____
BARCLAYS BANK PLC, as
Administrative Agent
By______________________________
Name:
Title:
[Consented to this ____ day
of ___________, ____
THE DETROIT EDISON COMPANY
By______________________________](1)
Name:
Title:
(1) To be included if required under Section 9.06(a) of the Facility Agreement.
47
Schedule 1 to
Assignment and Acceptance
relating to the Standby Note Purchase Facility,
dated as of October 26, 1999,
among The Detroit Edison Company, the banks party thereto,
Barclays Bank PLC,
as Administrative Agent for the Banks
(in such capacity, the "ADMINISTRATIVE AGENT")
and the Remarketing Agents party thereto
Name of Assignor: __________________________________
Name of Assignee: __________________________________
Effective Date of Assignment: _____________________
Principal Percentage
Facility Amount Assigned Assigned
-------- --------------- ----------
48
EXHIBIT C
FORM OF OPINION OF
COUNSEL TO THE COMPANY
Each Bank shall receive a favorable opinion, dated the date of the
Agreement, of the General Counsel for the Company, to the following effect and
otherwise in form and substance satisfactory to such Bank:
(a) The Company has been duly incorporated, is validly existing as
a corporation in good standing under the laws of the State of Michigan,
and is duly qualified to do business as a foreign corporation in each
jurisdiction in which the nature of the business conducted or the
property owned, operated or leased by it requires such qualification,
except to the extent that the failure to be so qualified or be in good
standing would not have a material adverse effect on the Company and
its consolidated subsidiaries, taken as a whole.
(b) The execution, delivery and performance by the Company of the
Agreement are within the Company's corporate powers, have been duly
authorized by all necessary corporate action and do not contravene (i)
the articles of incorporation or by-laws of the Company, or (ii) any
law, rule or regulation applicable to the Company or (iii) any
contractual or legal restriction binding on or affecting the Company or
any of its subsidiaries. The Agreement has been duly executed and
delivered by the Company.
(c) No authorization, approval or other action by, and no notice
to or filing with, any governmental authority or regulatory body is
required for the due execution, delivery and performance by the Company
of the Agreement, except such as have been duly obtained or made and
are in full force and effect.
(d) The Agreement constitutes the legal, valid and binding
obligation of the Company enforceable against the Company in accordance
with its terms, except as the enforceability thereof may be limited by
(i) applicable bankruptcy, insolvency, fraudulent conveyance,
reorganization, moratorium or similar laws affecting creditors' rights
generally and (ii) the effect of general principles of equity,
including, without limitation, concepts of materiality, reasonableness,
good faith and fair dealing (regardless of whether considered in a
proceeding in equity or at law).
49
49
(e) Such counsel is not aware, after due inquiry, of any pending
or overtly threatened actions or proceedings against the Company or its
consolidated subsidiaries, or any of their respective properties,
before any court, governmental agency or arbitrator which purport to
affect the legality, validity, binding effect or enforceability of the
Agreement or which are likely to have a material adverse effect upon
the financial condition or operations of the Company and its
consolidated subsidiaries, taken as a whole, or the ability of the
Company to perform its obligations under the Agreement.
(f) Purchased Notes at any time purchased for the account of the
Banks in accordance with the terms of the Agreement will constitute
legal, valid and binding obligations of the Company, enforceable in
accordance with their respective terms, in the amount of, and
evidencing the obligation of the Company to repay, the Advances made by
the Banks to the Remarketing Agents for the purpose of purchasing such
Purchased Notes.
(g) Assuming that the trustee under the Note Indenture holds the
general and refunding mortgage bond issued pursuant to the Mortgage
(such bond being the "PLEDGED BOND"), the Note Indenture creates a
valid and perfected first priority security interest in the Pledged
Bond. All holders of Purchased Notes will be entitled to the full
benefits of such valid and perfected first priority security interest
in the Pledged Bond, as so created by the Note Indenture.
Capitalized terms used but not defined herein shall have the meanings assigned
to such terms in the Agreement.
