THIRD AMENDMENT
Exhibit
99-1
THIS THIRD AMENDMENT
(this “Amendment”) dated as of November 10, 2008 to the Credit
Agreement referenced below is among TENNESSEE VALLEY AUTHORITY, a wholly owned
corporate agency and instrumentality of the United States of America (the “Borrower”), the Lenders identified on
the signature pages hereto and BANK OF AMERICA, N.A., as a Lender and as
Administrative Agent.
W I T N E S S E T
H
WHEREAS, pursuant to the Fall Maturity Credit Agreement dated as of May 17, 2006
(as amended as of November 2, 2006 and as of November 2, 2007, and as further
amended, modified and supplemented from time to time, the “Credit Agreement”) among the Borrower,
the Lenders identified therein and the Administrative Agent, the Lenders agreed
to make extensions of credit to the Borrower; and
WHEREAS, the parties have requested certain modifications to the Credit
Agreement and the parties have agreed to the requested modifications on the
terms and conditions set forth herein.
NOW, THEREFORE, IN CONSIDERATION of the premises and other good and valuable
consideration, the receipt and sufficiency of which are hereby acknowledged, the
parties hereto agree as follows:
1. Defined Terms. Capitalized terms
used herein but not otherwise defined herein shall have the meanings provided to
such terms in the Credit Agreement.
2.
Amendments. The
Credit Agreement is amended in the following respects:
2.1
The Aggregate Commitments are permanently reduced from $1,250,000,000 to
$1,000,000,000.
2.2
The definition of “Applicable Rate” in Section 1.01 of the Credit Agreement is
amended to read as follows:
“Applicable Rate” means, for any day,
the percentages per annum set forth on Schedule 1.01 based upon the S&P
Debt Rating and the Xxxxx’x Debt Rating then in effect.
The Applicable Rate
shall be determined by the Administrative Agent based on the lower of the
S&P Debt Rating and Xxxxx’x Debt Rating then in effect. Each change in
the Applicable Rate shall be effective on and as of the date of such change and
shall be applicable to all existing Loans and to any new Loans made on and after
the date thereof.
Notwithstanding the
foregoing, at any time that either the Xxxxx’x Debt Rating is lower than Aa3
or the S&P Debt
Rating is lower than AA-, the Applicable Rate shall be increased to (a) with
respect to the LIBOR Rate Loans, three percent (3.00%), (b) with respect to Base
Rate Loans, three percent (3.00%), and (c) with respect to the Commitment Fee,
three-fourths of one percent (0.75%).
2.3
The definition of “Base Rate” in Section 1.01 of the Credit Agreement is amended
to read as follows:
“Base Rate” means for any day a
fluctuating rate per annum equal to the highest of (a) the Federal Funds Rate
plus one and one-half of one percent (1.5%), (b) the LIBOR Rate for an Interest
Period of 30 days plus one and one-half of one percent (1.5%) and (c) the Prime
Rate.
2.4 The definitions
of “Pricing Increase Condition” and “Prime Rate” are added to Section 1.01 of
the Credit Agreement to read as follows:
“Pricing Increase Condition” means any
of the following: (a) the aggregate outstanding principal amount of Loans
exceeds an amount equal to 25% of the Aggregate Commitments or (b) the aggregate
outstanding principal amount of Loans exceeds $0 on the date of determination
and on each of the 59 consecutive calendar days preceding the date of
determination.
“Prime Rate” means, for any day, the
rate of interest in effect for such day as publicly announced from time to time
by Bank of America as its “prime rate.” The “prime rate” is a rate set by
Bank of America based upon various factors including Bank of America's costs and
desired return, general economic conditions and other factors, and is used as a
reference point for pricing some loans, which may be priced at, above, or below
such announced rate. Any change in the “prime rate” announced by Bank of
America shall take effect at the opening of business on the day specified in the
public announcement of such change.
2.5
The definition of “Maturity Date” in Section 1.01 of the Credit Agreement is
amended to read as follows:
“Maturity Date” means November 9,
2009.
2.6 Schedule 1.01 is
added as a schedule to the Credit Agreement to read as set forth on Exhibit A
hereto.
3. Extension of Waiver. Pursuant to
Section 6.01(b) of the Credit
Agreement the Borrower is required to deliver to the Administrative Agent the
financial statements described therein within 45 days after the end of each of
the first three fiscal quarters of each fiscal year of the Borrower. The
Borrower failed to deliver the financial statements described therein for the
fiscal quarter ended June 30, 2008 by the date required for delivery. The
Required Lenders hereby waive:
(i)
until (but excluding) December 29, 2008 any Default or Event of Default arising
under Section 8.01(c) or
Section 8.01(d) of the Credit
Agreement solely as a result of the failure by the Borrower to comply with Section 6.01(b) of the Credit
Agreement for the fiscal quarter ended June 30, 2008;
(ii) any Default or Event of Default
arising under Section
8.01(b)(ii) or Section
8.01(d) of the Credit Agreement solely as a result of the failure by the
Borrower to provide notice under Section 6.03(a) of the Credit
Agreement of the occurrence of a Default resulting from the
failure by the Borrower to
comply with Section 6.01(b) of
the Credit Agreement for the fiscal quarter ended June 30, 2008;
and
(iii) until (but excluding) December 29,
2008, any condition precedent in Section 4.02 of the Credit Agreement
that would not be satisfied solely as a result of (A) the failure by the
Borrower to comply with Section
6.01(b) of the Credit Agreement for the fiscal quarter ended June 30,
2008 and (B) the failure by the Borrower to provide notice under Section 6.03(a) of the Credit
Agreement of the occurrence of a Default resulting from the failure by the
Borrower to comply with Section
6.01(b) of the Credit Agreement for the fiscal quarter ended June 30,
2008.
4.
Conditions
Precedent. This Amendment shall become effective as of the date set
forth above upon satisfaction of each of the following conditions
precedent:
(a)
receipt by the Administrative Agent of counterparts of this Amendment executed
by the Borrower and the Lenders; and
(b)
receipt by the Administrative Agent of resolutions of the Borrower evidencing
the authority of the Borrower to enter into this Amendment certified by the
Secretary or by an Assistant Secretary of the Borrower to be true and correct as
of the date hereof.
5. No Other Changes. Except as
expressly modified hereby, all of the terms and provisions of the Loan Documents
shall remain in full force and effect.
6. Reaffirmation of Representations and
Warranties. Except for the representations and warranties referred
to in Section 2 of the August 27, 2008 Waiver among the parties relating to the
Credit Agreement, the Borrower represents and warrants that each representation
and warranty set forth in the Loan Documents is true and correct in all material
respects as of the date hereof (except those that expressly relate to an earlier
period).
7. Counterparts; Delivery. This
Amendment may be executed in any number of counterparts, each of which when so
executed and delivered shall be deemed an original and it shall not be necessary
in making proof of this Amendment to produce or account for more than one such
counterpart. Delivery of an executed counterpart of this Amendment by
facsimile or other electronic imaging means shall be effective as an
original.
8. Governing Law. Except for those
sections that specifically reference a federal statute or regulation, this
Amendment shall be deemed to be a contract made under, and for all purposes
shall be construed in accordance with, the laws of the State of Tennessee. The
foregoing notwithstanding, to the extent the following defenses would be
available to the Borrower under federal law, then such defenses shall be
available to the Borrower in connection with this Amendment: (i) non-liability
for punitive damages, (ii) exemption from anti-trust laws, (iii) the Borrower
cannot be contractually bound by representation of an employee made without
actual authority, (iv) presumption that government officials have acted in good
faith and (v) limitation on the application of the doctrine of equitable
estoppel to the government. For the avoidance of doubt, the Credit
Agreement, as amended by this Amendment, shall continue to be governed by
Section 10.14 Governing Law:
Jurisdiction: Etc. and not by Section 8, Governing Law, of this
Amendment.
[Signature Page
Follows]
IN WITNESS WHEREOF, each of the parties hereto has caused a counterpart of this
Third Amendment to Fall Maturity Credit Agreement to be duly executed and
delivered as of the date first above written.
BORROWER:
|
TENNESSEE VALLEY
AUTHORITY
|
|
|
|
/s/ Xxxx X.
Xxxxxxx
|
Name: Xxxx
X. Xxxxxxx
|
|
Title:
Senior Vice President and Treasurer
|
ADMINISTRATIVE
AGENT:
|
BANK OF AMERICA, N.A.,
as Administrative Agent
|
|
|
|
/s/ Xxxx X.
Xxxxxxxxxxxxxx
|
|
Name: Xxxx
X. Xxxxxxxxxxxxxx
|
|
Title:
Senior Vice President
|
LENDER:
|
BANK OF
AMERICA, N.A., as a Lender
|
|
|
|
/s/ Xxxx X.
Xxxxxxxxxxxxxx
|
|
Name: Xxxx
X. Xxxxxxxxxxxxxx
|
|
Title:
Senior Vice President
|